What gets measured gets done
“Well that is the old adage…” but what to measure. Picking the right things to point resources at can make a big difference to the results you achieve.
The O-A-R metric
What is it?
This is a simple idea – Identify the results you want, select the objectives which will most directly affect those results and then choose the activities that will most directly influence those objectives. Now measure the activities and the impacts on the Results, refine where necessary.
As your results focus changes so can your O-A-R metric, change the activity and the results will change too.
So, if our revenue =£100 per month
We have 10 customers
We visit 10 new prospects per month
We convert prospects at 10% [i.e. we win 1 new customer for every 10 we visit per month]
Sadly, we lose customers at 10% Per month [lose 1 per month]
We have 10 products in the range
Average cost of a product is £20
The average customer buys 2 products 3 times per year
What could we do to increase our revenue to £150 per month +50%
You can concentrate your time on any of the available metrics, but you can see that some have less impact than others. Once you have set yourself a clear SMASH objective, it is easier to look at each of the Activities to see which will have the desired RESULT
By using a ‘BIG EASY’ it is also possible to prioritise the activities in terms of success against the objective and difficulty or cost of execution.
From the chart below, you can see that working on introducing new products [Trade Up] may be more successful than conversion of prospects or retention of customers.
Indeed the ideal may be working simultaneously on several different metrics
of course, there is always…
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