Business strategy relies on clear thinking – and metrics. We can help you build a robust KPI framework to power your company’s progress. Find out more.
The strategic success of a business relies on clear thinking – and clear metrics. To build a data-driven strategy, you’ll need to define and align:
- Your company’s North Star goal. This is a long-term, high-level, motivational goal that acts as a guiding light
- The KPIs and metrics that help you navigate the journey to that North Star
- Agreed ownership of those KPIs within the business
- Succinct, timely and accurate reporting of those metrics
- Scientifically driven testing and measuring methodologies
At kleene.ai, we’re here to support your success. Here’s our take on KPI methodology:
Setting your goals
We’re strong advocates of identifying that North Star goal. Typically, it’s revenue for a scale-up business and EBITDA for a mature enterprise, so let’s take these as examples.
Once your North Star goal is set, examine the “levers” that influence it. In our examples, this means considering what you can do as a company to increase revenue and/or control expenses. What are your available routes to monetisation? What are the associated costs?
Each lever can then be expressed as a metric. The number of customers is a lever in increasing revenue. Logically, new customer acquisition and customer retention would sit below that.
Creating a logical map of these metrics results in a pyramid of KPIs, with the North Star at the top and the measurement of day-to-day operations at the bottom. This set of metrics empowers your teams to iterate their way to success.
The power of a KPI pyramid
Structuring your goals and metrics in this way has many benefits:
- Ownership by function is clearly defined
- Reporting and dashboarding is significantly simpler
- Data teams are freed up from answering endless reporting requests, and can instead focus on analysis and insight
- Focus is simple to maintain. If it isn’t on the pyramid, why is it receiving attention? (And if you do need to make changes to the pyramid, the structure is there to make it quick and easy).
Building data democracy
Any good data strategy must result in data democratisation. This means giving more people access to more data. It means empowering decision makers with good, timely and accurate data.
Taking a logical and structured approach to KPIs and their measurement makes it possible. And the benefits to the business can be quickly delivered, enabling you to get more value from your data.
Want to improve your company’s KPI methodology? We run strategic sessions with companies to create coherent, technology-agnostic data strategies. This KPI structure is a key deliverable of those sessions. If you would like to know more, please get in touch.