Measuring Tape

Where is the Real Value That We Should Measure?

One of the points I have made on this blog many times is that we often measure the wrong things when it comes to workplace productivity.

Seth Godin decided to take the recent release of watch times for shows on Netflix to remind us that hours spent watching a show is easy, but maybe not the measure of value that we think it is.

Valuable Contributions:

The obvious answer: more hours watched = more value created is pretty easily dismissed. In fact, a lonely couch potato with no friends who watches for eighty hours a week is probably costing Netflix more than they’re paying.

A show that’s popular but easily replaced by another show that could find the good luck to be popular is a shiny trap.

Perhaps value is created by the creator of a show that is the one show that gets someone to keep paying their Netflix bill, even if they only watch an hour a week.

Seth gets into more examples but he’s really on to something here because Netflix is not in the business of getting you to watch more programming, they are in the business of selling subscriptions. The programs that bring the most value are the ones that got you to sign up in the first place, or keep you paying your monthly subscription. Those might not be the same programs you spend as much time watching. When you look at the list of top shows you may be surprised that some of the biggest Netflix “successes” aren’t on it. Even though we talk about them, and people have signed up to watch them, it’s only a small part of the overall Netflix-watching experience.

For example, I don’t know anyone who signed up for Netflix or continues to pay for Netflix so they can watch Paw Patrol. But if you have kids who are fans they’re going to spend more time watching episodes of Paw Patrol than anything else you watch. So is Paw Patrol one of the most valuable shows on Netflix? Maybe, if it gets subscribers with kids to continue to pay their bills, but if that’s not the reason they are subscribers, just a happy accident of having kids, adding more similar shows might not move the needle on your subscription business at all.

That’s because we aren’t measuring the much more difficult things. We measure what people watch because it’s easy. Then we make that the stand-in for the information we need to know, why they stay subscribers. Why they subscribe is a more complicated question, but it’s the question that matters if you’re selling subscriptions.

In the business world, we do this all the time. We measure the easy things and use that information in place of the things that matter but also happen to be harder to measure. Law firms, you’re not immune here either. We measure sales. We measure support tickets closed. We measure billable hours.

What we don’t measure are the reasons a customer stays with us. What systems, processes, and people are in place that continue to make them happy? Do we recognize the people that do the things that keep them coming back or do we only recognize the people who made the sale or bill the most hours?

Let’s take a few examples from my professional history. Who is more valuable to you, the support person who closed five tickets in the same amount of time as another closed one? The obvious answer is the first support person, but ask yourself this, which one offered more value to your customer? Was it the one who offered pat answers and closed tickets, or the one who spent an inordinate amount of time identifying the problem and educating the customer on how to do this themselves going forward? Which one did more to increase the likelihood that the customer stays with you?

Is the person billing the most hours more valuable than the one getting work done for a client efficiently and making them happy regularly? What about the person behind the scenes making sure the people billing hours have the technology and knowledge to continue doing more billable work? Who’s truly more valuable? We know what you measure, but is what you measure capturing the true value?

More than likely, it’s not. But before you start making strategy decisions based on what you measured, maybe take a minute to consider all the “value” you didn’t measure.

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