Actionable Metrics

Data-Imagery was founded with the concept that good reporting, business intelligence, and the ability to view key metrics was something that most mid-sized businesses did not have access to.  Our name was created by combining “Data” and “Imagery”.  The idea that we could create images or graphs that would display data to the right people at the right time.  We started building reports for clients and building web dashboards to try to turn INFORMATION into KNOWLEDGE that could actually effect decision making for an organization.  As we got into the field, we realized that most companies had disperate database systems that were many times not connected.  Trying to connect these systems became very labor intensive and therefore costly to implement.  The cost was something that many businesses couldn’t stomach.

The reason I was so passionate about business intelligence was that my first job out of college was working at a computer training company that spent a decent amount of money on advertising and they would track every dollar spent on every ad medium.  Then they would track each phone call when someone responded to an advertisement and one of the first questions they would ask was how the caller heard about the company.  Then from this initial piece of data, that person would be tracked through the system to see if the company was actually able to set them up with an appointment and then if they showed up for the appointment and then if they enrolled in the school and then if they actually started school.  My job was to create reports and graphs of all this data for management to make better marketing decisions.  I actually loved the work, and loved how effective is was for management to get this data in a format that allowed them to make intelligent decisions.  My salary at the company was completely devoted to this reporting, but it paid off because money was being spent wisely on marketing efforts that actually worked.  The company had a vision for analytics and ran their company by these numbers versus relying on gut level instincts (which many times are wrong).

What got me started thinking about all this is the new movie out based on Michael Lewis’s book “Moneyball”.  The story follows the 2003 Oakland A’s and their General Manager, Billy Beane, who used a method called Sabermetrics to choose undervalued players that had the ability to help win ball games. Sabermetrics is defined as “the search for objective knowledge about baseball.”  Billy went through a process of identifying the metrics they thought would give them the most benefit for the least amount of money.   They choose to ignore the vanity metrics that are traditionally used by teams to evaluate players like batting average and instead use a similar metric called on base percentage.  What I love about the story is how hard it was for Billy Beane to implement decisions using the objective statics found in Sabermetrics with the team.  Nobody in the A’s organization really “got it”.  It just wasn’t the way baseball was done.  It took significant vision from Billy and it took incredible leadership to implement these ideas, and it wasn’t easy.

At the end of the day, making decisions based on objective analytics led to a big pay-off for the A’s with a winning season.  And there is also a big pay-off for companies that are run this way as well.  The problem is that it takes significant leadership to be disciplined to figure out the key metrics needed to increase growth or profitability of a company.  And then it is even harder to make tough decisions based on the findings from the metrics.  As Moneyball shows, this process wasn’t easy for Billy Beane, but it was well worth the effort.

logo

View other articles in: Consulting