Sharing key metrics within your startup — Dos & Don'ts
As a founder or CEO (or both), you’re confronted at some point to making decisions on what your stance is regarding sharing key metrics with your team.
As I have been and I’m still confronted to making these decisions, here are my take-aways on what worked well for us, and what didn’t, in a journey from 0 to 25 teammates.
- Give flesh to metrics: make sure you share qualitative info as well, but try to have it fit on one mobile screen (without scrolling). Add live reviews
Have One Metric That Matters (OMTM) and count your fingers
We learned this (damn simple) concept during our stay in 500Startups’ accelerator. At the time we were a small team (6 people), and it helped us focus on a single metric and make it grow relentlessly. It actually « scales » pretty well to a larger team, to align everyone on a simple, single metric that needs to improve over time.
In our case, we focus on a key metric in SaaS : MRR (monthly recurring revenue). Of course the OMTM can be pretty much anything that’s relevant to a business : visitors, downloads, daily active users, etc.
As time goes by it becomes tempting to add more and more metrics. We’ve actually added complementary metrics like churn or NPS, but the point here is to make sure each and every employee knows at any moment in time what’s the value of the OMTM.
We did this almost without noticing, as we added a daily Slack notification showing the Current MRR. It gets “delivered” every morning at 8:48 in our #general channel.
So that’s the 1st piece of information everyone sees when s/he opens her computer. De facto, it positions it as the top and foremost metric. People will probably small talk about it at the coffee machine. And it sets the tone of the day.
Beyond the OMTM, we’re sharing additional, important infos, on a weekly basis :
- Revenues from extra invoices
- Total number of customers
- ARPA (average revenue per account)
- Number of sign-ups to trial
In fact, we’re probably not a model here. Too much information, too much business-oriented. I’m pretty sure most of the team doesn’t KNOW the value of every of these KPIs. And as I was trying to recap them here, I found that essentially you should be able to associate one distinct finger to each metric — it’s a much easier way to remember them.
So let’s say the middle finger is the OMTM, it leaves you 4 fingers max to build on.
Starting this week, we’re changing our metrics to make them more compact and more balanced:
· Baby finger : NPS
· Ring finger : ARPA
· Index finger : Call quality rating
The goal is to get the whole team understand better a smaller number of KPIs.
Share with everyone
As the company grows, you end up hiring roles that are more « support functions » (accounting, HR, assistants, etc). These roles do not necessarily need to be included in the diffusion of key metrics.
What is actually more difficult to achieve than just sharing metrics and info, is to have the whole team understand them and take them as valuable information. Most team members don’t have any direct impact on any of the compani’s metrics.
I realized over the past few months that most of the information we’re sharing as a team is in fact overlooked. So far we found 2 workarounds to solve this : reduce the number of metrics we’re sharing on a regular basis, and spend a few minutes every week to explain or recap what one of these metrics means and implies.
Don’t be transparent on everything
As a corrolary to the precedent point, it’s a tempting mistake to share more than what’s actually useful. Yeah we’re a cool company and we’re « open ». But in the end the only question we’ve come to ask ourselves is : « Does that information/metric help the team work better as a team ? »
I made an experiment last week as I was onboarding new hires. The topic was to share with them our vision and long-term strategy in a 1-hour session. I concluded by quickly reviewing the KPIs we use on our monthly board meetings. I didn’t plan to give regular updates on these metrics but my intent was to give them a sense of what matters at the top of company. It proved actually too much and I “lost” them. Too many metrics doesn’t help productivity (e.g. cash in bank and burn rate)
The Week is God’s pace. Copy, but be smarter
Since we’ve started Aircall, I’ve noticed that a weekly pace gives a great rhythm.
We started within the eFounders startup studio who have a good habit. They demand from each companies’ CEO to send a Sunday night email with a recap of the week and an agenda for the week forward. I find this an absolute best practice, whether you have a team of 4 or of 20, because it forces you to think and achieve weekly results.
But as we matured on this processes, we realized (obviously) that not all metrics made sense on a weekly basis. So we’ve adjusted:
- weekly update on the fingers metrics
- monthly updates on more strategic, ad-hoc metrics
We’ve considered adding “real-time” metrics, like displaying the MRR in real-time on a screen or a real-time tech dashboard on loads and errors. As of today, I’m not convinced about real-time business metrics: a developer’s time is not a sales’ time. It’s distracting more than helpful.
Even on the sales side, I feel daily MRR or Sales results update makes more sense: you come in the morning and there are a couple of things you want to achieve in the day — but real time doesn’t help much.
It probably makes sense to have a real-time dashboard on the tech/infrastructure side and we’ll probably add this in the future, but we’re talking here about live info for the tech team only — the rest of the team doesn’t really need it.
Give flesh to metrics
From our recent experience, sharing metrics is just the tip of the iceberg. The most important outcome is for people to “appropriate” the metrics and give sense to them.
We found 2 ways to achieve this:
- Weekly metrics come with a few lines of comments. At first, I was adding a bunch of comments on my weekly updates. Wrong. Keep is short and smooth. A few lines next to the metrics to outline what’s important.
- Weekly team meeting. We have a 10 minutes weekly meeting with the whole team. I realized recently that spending a few minutes on one particular metric, explaining its meaning or what conclusions we can draw from, can be both enlighting and “engaging” for the team.
Over to you. What metrics do you track and most importantly share with your team? Tell us in the comments below. In the meanwhile
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