Smarter Metric Design
The value of data is continuously increasing and businesses are paying greater attention to how they can extract more potential from their company’s information. We are seeing more money and time being spent on intricate data analysis. Unfortunately, expenditure can result in fruitless results under the impression that all data is helpful. This is not the case and often metric design is to blame. Without proper and renewed consideration into how metrics are utilised a business may end up losing more than it gains. If you are using analytics within your business, then here are some of the issues that are often encountered, which may prompt you to seek support.
The Data is Great, Therefore…
One common mistake is that the data accrued may be flattering. An examined metric may inform you that your website views are high or that your customers often recommend you. The problem with this result is that, although it immediately seems positive, it actually lacks value. It is a bias that inclines a business to think positively. The website views may be high, but how long is being spent and how many are returning?
The Cart and the Horse
Often metrics are utilised before an outcome is decided upon. Companies will turn to data before deciding what it is they actually want to discover. Much of a business’ wasted expenditure can be attributed to spending on metrics that do not support an outcome. Although deciding on an outcome before the metrics may not be intuitive, it is actually fundamental to a smarter process. By outlining what your business is looking for, you can prioritise the tools necessary, avoiding wasted endeavours or costly research.
Technology is changing constantly and quickly. Your business sits within a market that changes and is supported by clients and customers that also change. It is surprising how many businesses fail to acknowledge that their metrics may need to change too. The way in which you amass your data and the way you examine it can quickly become invalid. It is important to constantly renew your analysis structure and design as they could be expired.
The Player and the Game
While few metrics are inherently flawed, their implementation may lead them to be redundant. Often this is the case when a goal is included with their process. The issue with an incentive is that the end user or the person using the metric will have more inclination to achieve the goal instead of sticking to the true data. As soon as this becomes apparent, the information becomes invalid.
It is understandable to be overwhelmed by the processes involved with metric design. It may seem complicated or the potential improvement that reform can lead to may not be clear. Data expert organisations, such as Outlier Technology, are vocal about its importance as well as the benefits of constantly reviewing your metrics. Even outside of problems you may encounter, due to the benefit your business may receive from seeking external and professional advice, it is highly recommended.