6 Reasons Why Everyone in Your Organization Should Have a Number
What gets measured gets done, plain and simple.
That’s why, within the Entrepreneurial Operating System, we recommend getting a strong grip on the Data component of your business. Taking ownership of your organization’s data will enable you and your leaders to create clarity and accountability throughout your teams.
Complete mastery means giving every team member a single meaningful, manageable number to guide them in their work.
Giving everyone one single number will offer you and your organization six distinct advantages:
#1: Numbers Create Accountability
When you set a number, everyone understands what’s expected of them. For example, if you hold your Accounting Department responsible for “collections,” your expectation is unclear. However, if Accounting knows they are supposed to keep the accounts receivable days below 40, the balance below $100,000, or aged receivables less than $50,000, the department is clear on your expectations. That number makes the target and, therefore, the accountability, clear.
#2: A Number Creates Objectivity
Numbers cut through the murky subjective communication between manager and direct reports. As an example, the old response between sales manager and salesperson regarding last week’s sales activity was a vague “Great! Things are picking up.” The new number-based answer is crystal clear: “I got three.” If three is good for the company, then last week was great. If the target was 10, there is an issue to solve.
Better to solve it now than two months from now when it shows up as poor revenue in the P&L. A clear number can become a powerful communication tool between a manager and a direct report, creating the basis for comparison, unemotional dialogue and, ultimately, results.
#3: Accountable People Appreciate Numbers
The right people in the right seats love clarity. They enjoy being part of a culture where all are held accountable with the clarity they need to succeed. It creates a culture in which everyone pitches in to make the company a success.
Note: The wrong people who are in the wrong seats usually resist measurables. If you have someone on your team who is reluctant to accept a number, take a second look to see if there’s a mismatch.
#4: Numbers Create Healthy Competition—and Teamwork
Charles Schwab creates competition by making target numbers known to all teams. Sure, team members may experience some discomfort when they’re struggling to meet a target, but there’s nothing wrong with a little friendly pressure to produce results.
Numbers also create a sense of camaraderie when a team strategizes how to hit a particularly challenging number. For example, when a team of technicians are challenged to perform their service in four hours or less collectively, they’ll all pull together to figure out ways to achieve that number. The ones that aren’t pulling their weight will be called out by the other team members that are.
#5: Numbers Produce Ultimate Results
When you create these numbers thoughtfully, they can help you achieve both internal goals and external goals. For example, let’s say your Customer Service Department sets the expectation that zero customer issues go unresolved. By hitting that number, you’ll not only create accountability within the department, but you’ll also achieve the ultimate result of customer satisfaction and, likely, greater customer retention.
Create your numbers carefully by tying them to bigger organizational goals, and you’ll discover new ways to impact your organization in multiple ways simultaneously.
#6: Numbers Create Solutions
When you use activity-based numbers—such as sales appointments booked per week—as opposed to end-result based numbers like new business booked, you’ll spot issues earlier. You’ll be able to attack and solve any problems faster. In addition, the use of hard data makes tough decisions clearer and easier. If your people are simply not hitting their numbers, month after month, it’s probably time to make a change.
Building an Organization That’s Transparent
Once everyone has a measurable they’re accountable for, you’ll find yourself at the head of transparent organization. It will become a place where people are open and honest, one where there’s nowhere to hide. Any obstacles that stand in the way of achieving your vision will become easily apparent. You’ll know exactly where you have issues to solve, and your organization will make quick progress toward growth.
That’s the power of giving everyone a number.