8. Measurement and Data

Choosing the right way to measure success is one of the most important decisions you must make.

Many companies identify a single shared metric (called the North Star), then layer metrics so that each level of the company is rowing in the same direction.

A single metric is psychologically useful for a creative organization because it can be used to galvanize the creative work.

Each team should figure out which goal they drive contributes the most to the company’s North Star metric, then focus entirely on that single goal.

Finding Your North Star Metric

North Star metrics are most useful at the company level, but they can exist at any level. Here are four essentials of choosing your North Star metric:

Your North Star must represent customer value.

Example: “Increase the number of customers engaging daily,”

NOT: “Improve product-market fit”.

Your North Star must express something fundamental about the vision and strategy of the company.

Example: “1 billion PCs bought”

NOT: “Increase market share to x%”

Your North Star must be a leading indicator.

I.e., Predicting future performance, not summing up past performance.

Example: “Number of deals signed monthly”

NOT: “Size of last quarter’s revenue”.

Your North Star must be actionable or influence-able by the team.

Example: “Double digit sales conversion increase”