business

The "Best" MSP Pricing Model

User Based All In Seat Price (AISP)

What is your pricing model for your managed IT service offering? I know it’s a hotly debated topic. I personally like the all in seat price (AISP) model. Pricing by the user is the most business-friendly and easiest to scope. If you’re pricing your service correctly and standardizing the client environment, it shouldn’t matter too much how many devices the client has. The only caveat being if the environment has more devices than users. If so, just count the systems instead of the users.

Your client facing pricing should be as simple to understand as possible. Remember the client asked to meet with you because they don’t want to understand or deal with technology. If you present a pricing proposal that has 14 line items talking about endpoints, firewalls, APs, SQL servers, and others, you’re likely going to confuse them about what they are paying for.

confused-mind-makes-no-decsions.png

“A confused mind makes no decisions.”

You may have a crazily complicated spreadsheet that you use to calculate your cost to support an environment based on the number of devices and that’s fine, but don’t make the client try to decode your cost structure. Do whatever calculations you want to scope your costs and adjust the price as required, but when you’re pitching your service to a prospect, just give them the simplest price possible.

I’ve heard some people argue that they like to have flexible pricing that people can mix and match in order to be price competitive. While this is good in theory, Portugal is a great example of how this can be maddening. In Portugal, they have service-based pricing for internet service. (Side note, this is exactly what we are fighting against when people talk about net-neutrality) This means when shopping for internet service your price list looks like this.

Ala Carte Pricing can be frustrating

Ala Carte Pricing can be frustrating

No one likes fractional service and up-sells for your internet access. This would drive me mental. I just want internet access, don’t tell me what I can and can’t use. This type of service would influence my perception of the service I’m getting.
Don’t discount your price and make your service modular. Set a fair market price that covers your costs and allows you to have some margin. Strongly enforce standardization with the clients and provide a full-service offering so they feel the value in partnering with you for IT service.

MSP Pricing Strategies

Let’s look at some of pros and cons of the most common MSP pricing models.

Fixed Fee Pricing

Allows you to set a price that is easy to communicate and includes everything a client will need to rest easy knowing that their IT partner is looking after their business IT needs with a comprehensive support package. They won’t be “nickel and dimed” with additional bills. The provider can rest easy knowing they have enough margin in the agreements to do the work necessary and be profitable.

Pros

  • Pricing is easy to understand

  • Allows necessary margins on agreements

  • Allows comprehensive support

Cons

  • High cost

  • Seriously limits the type of customer you can sell to

  • Strong standardization that may not appeal to all prospects

Tiered Pricing

Tiered

The industry favorite of gold, silver, bronze packaging. Allows a variety of service offering to appeal to various markets. The client can choose the level of service based on their budget or requirements. The provider can cast a wider net to take on a larger variety of clients.

Pros

  • Flexibility of price

  • Easier to sell to anyone

  • Prospect can choose price based on budget

Cons

  • Cheaper options can attract less mature clients

  • Complexity of offering makes service level standardization tougher for provider

  • Low cost option could create a poor value experience for new customers

Per Device

A lot of MSP businesses use the per device model in order to manage the costing for complex environments with higher number of devices. This is important to consider when environments are unstandardized and therefore noisy.

Two important things that get missed a lot in using this model.

  1. There is a high degree of complexity in managing the correct cost for this model as devices are added and removed from the environment. Providers often neglect adjusting the contract for new devices and end up eating the cost.

  2. The need for a complex pricing model in this scenario is usually based on the fact that the client environment is not standardized. Costs for support are much more predictable if you standardize the client stack.

Pros

  • Price is variable based on device adds and removals

  • Provider has clear sense of what devices are supported under the contract

Cons

  • Contract is often not adjusted when devices are added or removed

  • Large number of technical line items makes the costing very confusing to the client

  • Administrative effort to manage billing can be taxing

Per User Pricing

Per user pricing model is my preferred approach. It’s easy to quantify, easy for the client to understand, scales well, and helps frame a more comprehensive support package.

The model is similar to the device model, but instead of charging 6 different low prices for each device, you simply charge a higher price person you will support.

I’ve coached several clients through this transition from device to user based pricing and the push back is always similar, “What about all the devices?” “My clients would never pay that price, etc.” I can appreciate where this fear comes from, changing your business model is not easy, but most cases I have them calculate the cost of the client contracts on a per user price of $125-150 pre user and compare to what they are charging. In most cases the cost comes out strikingly similar. The important caveat to this model is you need to be focused on selling a full value IT stack. Time and materials clients, monitoring only, and other fractional engagement models won’t work well in this selling model.

The beauty of this model is you can build the price based on whatever costing model you like. So you can still use device based pricing calculators to figure out how much you want to charge them. The end result should be an All-In-Seat-Price (AISP) that you present to a prospect. You don’t even have to charge the same amount for each client. Some may be $125/seat, others could be $200/seat. This variability allows you to build a more flexible solution that is not confusing to the client. In cases where there are part time users, just use a full-time equivalent calculation (eg. 8 part timers equals about 4 full-time users). Avoid confusion, encourage a standardized solution stack for all the users in the environment.

Pros

  • Simple for client and provider

  • Allows flexible costing behind the scenes

  • Filters prospects not looking for a full value IT partner

Cons

  • Cost conscious prospects may not see the value provided (or is this a Pro?)

  • Complexity in defining what is in your stack at what price

  • Requires strong client stack standardization


How a Mature Price Model Benefits Your Business

Never be afraid to go up market. Grow your business by increasing the value you deliver to your clients and increase the AISP to match the value provided. Stop focusing on hours of effort and devices. Instead focus on a valuable technology solution stack for all the staff members of that client. Don’t compete on price and stop treating every opportunity the same. Very small businesses may be better off using a low cost time and materials provider. Focus your business on growing a client base slower by seeking out clients that understand the value of a full service managed service provider. Long term your business will be more successful if you focus on higher margin business. Learn to be confident to walk away from lower value business and save your time and effort for the great long term clients that appreciate the value you deliver.



What to do when a client's IT is a total mess

I’m sure you’ve heard the expression, “If you think a professional is expensive, wait till you hire an amateur.” The technology field is a perfect example of this. We’ve all had those clients that were managed by a semi-technically literate person in the office. You’ve probably inherited a client from another MSP in your area and found it was barely managed at all by the previous provider.
The fact that most people don’t understand technology is a blessing and a curse. If more people were capable of supporting their own IT needs, there wouldn’t be as much work for us. The downside is that people are often misled or simply unable to tell if their IT support provider is doing the work that is expected of them.

Professional-amaetuer.png

Here is a familiar scenario.
Client prospect company is a small accounting office with 14 staff. They have the youngest guy in the office do tech support for the rest of the company and they also have an “MSP” that they call when they need. They are looking for a new support provider because the current provider sometimes takes a day or two to get around to helping them. The prospect has grown tired of waiting and needs a more mature level of support.

STEP 1: Review environment

You should assess the environment. This can be as simple as a walkthrough of the office. An experienced senior tech should have a good sense of the situation simply by looking at the physical environment. Is the network rack a rat nest of wires? Is the server a white-box with the side panel taken off cause the closet they use as a server room is overheating the equipment?
This review of the environment can give you a great sense of what the current status is and how much risk the client would bring to your company as a supported client.

STEP 2: Gauge client’s willingness to invest

If the client environment is a hot mess, many people would assume it’s because the prospect is cheap and refused to pay for the appropriate equipment and support levels. Sure, this is often the case, but you shouldn’t jump to that conclusion without confirming with the prospect. 
Meet with the client in person to discuss the results of your findings and what you would propose to remedy the situation. Lay out a plan of projects that are high impact and would remove the major points of risk. They may not agree to everything because they likely haven’t been budgeting for IT spending. However, they should express a desire to make the investment in fixing major issues. They should have a reliable server, hopefully with warranty support. They should have an image based backup in place. They should have cloud-based email services like O365 or G-suite.

STEP 3: Go or no-go

If you want to build a business that doesn’t cause you to lose sleep or feel like you’re constantly pushing a boulder up a hill, you need to be selective about the clients you take on. When you’re first getting started the temptation to take on any client is strong, but this approach can create a lot of headaches for you and your staff. If the prospect is a mess and resists spending to correct the major issues, walk away! If they spend the majority of the time talking about the price of service and projects. They are not going to be a good client.
If they see the value of the changes and appreciate you bringing them to light, get them to commit to making the major correction within the first 2-3 months of the relationship. Straight away would be better, but may not be practical based on their cash flow. 

All revenue is not created equal

All revenue is not created equal. Don’t chase clients that are simply looking for the lowest price.
Just because a prospect environment is a disaster doesn’t mean they know that. Act in their best interest, be honest about the situation. Never blame the previous provider, remain focused on the future. Help them understand that you will provide a higher level of service and that lowering their risk will avoid costly issues in the future like downtime, data-loss, and crypto events.


This article is an example of the content I send out in my weekly email. If you’d like to get this great content early and delivered to your inbox, sign up below.

Getting your techs to enter time

I’ve worked in IT for 20+ years. I’ve worked at large enterprise systems integrators, small IT support companies, and run my own consulting group. I’ve run teams of 5 and teams of 50. No matter the place, no matter who I talk to in the industry, one of the most common issues people struggle with is time management and timesheet entry.

What strategies have people found successful in getting people to enter their time be accountable to this responsibility? Also, how do you manage your workload so that you don’t feel overwhelmed?

Here are a few I've found successful.

1. Explain why it’s necessary

It’s amazing how much a little bit of education can change someone’s feeling about having to do something. When onboarding someone, explain to them, “We need you to enter your time. Without your time entry, we can’t create invoices for the clients, which means we don’t get paid. So it’s pretty important. This is why I’ll be persistent about you getting your time entered.” Even if you don’t need the time entry for invoices, just substitute the WHY on the time entry, explain how it fits in the company process. If people realize it’s not time entry for time entries sake they may put up less of a fight.

2. Make it easy

The more cumbersome the time entry is, the less likely people will be compliant with the process. This kind of true of anything, but if time entry is important to your business, you need to spend the time to remove the fat/overhead from the process.

3. Prioritization

One of the major reasons people get overwhelmed is a lack of focus. There is only one thing you can do at a time. (check the research multitasking doesn’t work) Focusing on what is important. Making small gains feeds momentum. Anytime someone showed up to my office overwhelmed I loved working with them to write out on the whiteboard all the things they felt they needed to do. We would discuss urgency and importance of each. Stack rank the top three things and send them on their way. “Focus on these three first. If you need more help come back and see me after.” Usually, they just needed perspective to break out of the overwhelmed state. They rarely came back soon for help with the next three things.

4. Train them

What makes humans amazing is our ability to contemplate and influence the future. We are terrible at influencing the past, but we sure do spend a lot of time on the past. Switch your thinking and focus on the future. Train yourself and your staff on how you want things to be done in the future, then give them feedback to ensure they follow their training. Forget about what people have or have not done. Focus on what you want them to do. Train them, support them, and coach them.

I’m passionate about helping MSP techs gets more done with less stress and a sense of greater control, so I built the MSP Productivity Accelerator Course. It teaches you techniques of the GTD (Getting Things Done) methodology and how to manage your workload in the Connectwise. I did this type of training in person a lot and people always found it helpful. If you want yourself and your team to be better at managing your time and staying on top of the work in your PSA check it out.

 

5 Simple Ways to Measure Your Project Management Maturity

5 steps for effective project delivery

It doesn't matter what tools you use to manage your projects. It doesn't matter if you use Agile, follow the PMBOK, or are training for Six Sigma.

What matters in projects is "Who, does What, by When."

Don't feel bad. Most tech companies are counterintuitively terrible at project management. Gartner data suggests that over 80% of technology projects fail to deliver on time and on the budget.  Granted, this includes software projects which are much more subject to scope creep than traditional systems infrastructure. The simple fact is most technology organizations are just getting by with their PM practices. In most cases, people look for a tool to solve all of their communications, accountability, and collaboration needs. Often they are thinking, "If we just had the tool to solve x, we would be okay." In most cases, people need to fall back to basics. 
Who, does what, by when, keep people accountable, and you end up with productivity magic.

Here are simple measures of how well you are managing your projects.

1. Is there a project charter or statement of work (SOW)?

The sales guy has a hot new deal with a client that is rushing to get this server migration finished before they end a support contract.... Is your skin crawling yet? Yes, this is all too common. In our genuine efforts to satisfy the client, we rush the project through without proper scoping. These projects are rarely successful and risk the trust of the client. Don't stand in the way of revenue, but also balance the need for sufficient planning. Have the sales and technical groups establish that a 24-48hr return time on requested SOWs is the standard. If the sales team can trust that deliverable will get back to them within a reasonable time, they will extend more trust to the team. Ensure both parties agree that having a SOW will produce better results for the business and the client. Have a SOW for every project of a reasonable size. 

2. Does the project have a reasonable end date?

Parkinson's Law states that "Work expands so as to fill the time available for its completion." If your project has a statement of work you should know how much effort is involved. Therefore you should be able to schedule that work and determine what is a reasonable end date. For example, you have a project that will take two people at a total of 40 hours. Often people will schedule the work for a week. Which is unlikely to be successful. Instead, schedule the completion for two weeks out. Unless there is an urgency to the work, you're better to set a more reasonable deadline. Keep it tight, by having a deadline, but not so tight that you have no slack for issues. You also want to ensure you have enough time for activities like a kick-off, close, and status meetings. 

3. What is the communication rhythm?

Communication is the most critical tool in keeping projects on target. Unfortunately, communication is also one of the first things to slip when issues crop up. In order to defend against communication degrading your communication rhythm needs to be established and scheduled ahead of time. The type of communication is variable, but as much as possible try to over communicate. If nothing else, keep a high cadence of communication. If the project is active with lots of complexity a daily stand-up might be best. If the project is longer with clear milestones than weekly probably works. A higher cadence of shorter touch points defends the team from sitting in unnecessarily long status meetings without allowing large gaps that could derail the project.

4. What did we achieve last week?

Every status update people need to report on what has been achieved. NOT what hasn't been done. Are deliverables being achieved on the dates set? If not what is required to correct this? This is probably one of the hardest things a project manager has to do in managing the team. People so often want to tell you stories about why something hasn't been done. This fundamentally isn't important, especially in a status meeting. If necessary you can have a breakout meeting to review these types of issues, but it often isn't valuable input, especially for the entire team. If you find your team members rambling on about why something wasn't achieved simply stop them politely and ask them to think about what their plan is to get things back on track. Offer support in working up a plan if need be and that can be the focus of a breakout meeting. This approach will help you keep focused on moving forward rather than litigating the past failures. 

5. Did we have a kick-off and close?

Finally,  did the project start with a kick-off and end with a project close? In an eagerness to get started teams often skip the kick-off which is critically important for a number of reasons. The kick-off is a key component to establishing the parameters of the project including, reviewing the scope, setting the communication rhythm, setting expectations with the client/stakeholder, and reviewing scheduling. The project close also often gets skipped as the team gets busy and wants to move on to other things. A briefing after the project is complete is a valuable way to capture what went well, what did not, and how can we use that information to make future projects better.

Summary

Developing a higher level of maturity in how you deliver your projects is not something that will happen overnight. Projects by their nature are messy and complicated. Working on a single task by yourself in a day is straightforward, it has a low level of complexity. Working with even three people on a deliverable that have 15 steps and involves numerous people and/or systems is an order of magnitude more complex. Complex work requires planning and communication in order to be accomplished.

If you're just getting started focus simply on who, does what, by when. Then layer in the above 5 components and your process will already be more mature than the typical organization. If you'd like some support in getting the basics implemented or if you're ready to move your maturity to the next level be sure to reach out to Evolved for a more detailed review of your processes (or lack thereof). 

The Two Pizza Rule

Why the two pizza team makes your company more productive

Pizza to feed your team

Pizza to feed your team

The two pizza team approach was popularized by Jeff Bezos, but the approach is not new. You’ve probably heard the story about Steve Jobs being ruthless about the number of attendees to a meeting. Drake Baer noted a couple of these stories in his article for BI. Jobs declined to meet with President Obama and other technology moguls because the group was too big. Jobs also routinely dismissed people from meetings if he felt they were not core to the meeting. Keeping meetings and teams to a manageable size can have dramatic impacts on the efficiency and cost-effectiveness of your business.

Why?

There are numerous reasons why limiting a team size is important, here are a few.

  • Cost effective meetings
  • Manageable teams
  • Accountability
  • Communication

Cost Effective Meetings

Meetings are universally derided in modern business. There are books, comics, and YouTube videos pointing out the amount of time wasted in meetings. Many meetings could simply be replaced with a weekly email, or even better, with a collaboration tool like Asana or Slack. Next time you are sitting in a meeting think about the cost of that meeting based on how many people are in the room. 12 people, making an average of $70,000/yr, meeting for 1hr once a week? That costs the company $23,764 per year. Let’s scale that back to 4 people. Now that meeting costs $7,904 per year and we saved $15,000 a year. It’s not just the cost of the pizzas that matter. It’s a measure of how many people are required to commit to a certain project or initiative.

Manageable teams

A manager should never have more than 10–12 direct reports. Ideally, teams should be 6–8 people. How many pizzas would you order for 6–8 people? Correct, two pizzas. Well managed teams have something universal in common. A strong relationship between the manager and the peers. Historically management relied on role power to direct teams. This approach typically manifests in directing the team through fear. Fear of being fired, fear of being reprimanded, or fear of humiliation. Sure you can produce short-term results, but anyone who has ever worked for a “mean boss” can tell you, the returns are diminishing. A manager that has a relationship with their direct reports will be able to produce greater results for the long term by appealing to a sense of loyalty and self-worth. This relationship-based approach to management is built on developing a connection with the staff in the first place. If a manager has 10–20 reports, people will be left out. It’s simply not possible for a person to nurture a working relationship with so many people. In addition, the team will naturally form sub-groups within the team and thus damage the potential relationships of the peers in the team. Having smaller more focused teams will limit meeting size and ensure productive relationships within that team.

Accountability

There is a psychological phenomenon called diffusion of responsibility. A great example of this when a group witnesses an emergency the more people that witness it, the less likely that anyone is to take action. Groups of people will assume that someone else will take responsibility. This is true in business as well. When someone sends a generic email to a group of people asking them to do a task, very few will act on it. Also, if a team observes a problem at work, the larger that group, the less likely they are to raise that issue with peers or management. People tend to assume that everyone is aware and therefore someone else will take action. Inaction is often assumed to be an indication that no one cares about the issue. A small two pizza team will have a higher degree of accountability. Peers will be more likely to keep each other in check and the level of personal accountability to the team and its deliverables will be higher as well. Contrary to popular opinion people are not lazy and want to achieve great results. They just often lack the conditions to facilitate it. A smaller team will allow a pride of ownership that is more likely to breed better results. A smaller team also simplifies responsibility and delegation of duties to individuals instead of groups of individuals.

Communication

Did you get the memo?

Communication is a pillar of any successful business or group. Even small businesses tend to struggle with effectively and efficiently communicating with staff. Modern businesses will use technology to try to communicate to everyone, but as with many issues in business, technology does not solve human issues. “Did you get the memo?” This is an outdated phrase from years past, but it’s no different than the more modern form of “Did you read the email?” or “Did you see the bulletin?” In most cases, a more human touch is required when communicating to teams. A typical method in organizations is the waterfall approach. Executives communicate to leadership and leadership carries that communication to staff. A great manager will not simply repeat the messaging verbatim but will re-interpret the message for their team specifically. How does this event or direction impact our work? How does this initiative change our priorities? Helping teams to digest corporate communication is much simpler when there is a tighter focus and a smaller team. Another benefit to smaller two pizza teams is it helps to contain information. Everyone has been on one of those email chains with 20 CCs that just never ends. Using collaboration tools like Slack can contain the team communication to the relevant parties, while still allowing that information to be shared with others if required.

How?

Small companies that are growing past 10 people are the first to struggle with the issues that result from a growing team. Companies that are scaling past 30 or 50 people suffer again from these growing pains. Scaling a team is difficult and requires a focused effort on training leadership and management skills into your promising staff. Anyone that manages a team should identify their right-hand in that team. Whether you are a small business owner with 10 staff or a front-line manager with 4–6 staff, find the person on your team that you would leave in charge if you’re on vacation. Work with intention to develop that persons leadership skills. If appropriate designate them as the team leader. A team lead is different from a manager, they are a part of the team and are less likely to be treated as management. They can help facilitate communication and problem escalation for you. When the team grows you have a built in leader that you’ve been coaching. If they are interested in taking on more leadership responsibilities they can take on a team of their own. Don’t let your teams grow beyond management. Keep them to a two pizza limit and everyone will benefit.

A Modern Approach to Managing Teams

Management is a fairly young profession. Management was born out the industrial revolution when suddenly workforces swelled from 5-10 people, to 50 or 500 people. This change brought about a massive shift in our society, how products were produced, how people lived, and also how business owners managed their staff. Times have changed since the days of assembly lines and physical labour being a dominant mode of work. As this Wall Street Journal article highlights, work is evolving and the knowledge economy is starting to dominate the bulk of our workforce. Sadly management practices have been much slower in their evolution. There is a crisis in management today, to recognize this all you have to do is look at the number of books, articles, and apps that are produced to help struggling managers. So much of this information is theoretical and lacks the implementation framework to make the information useable. In a previous post on medium, I've written on how the two pizza rule can define your team size. In this post I would like to provide a more modern and practical approach to managing people and teams.

Relationships are built on trust

Many managers do no fully appreciate the power they wield over their staff. Without your approval and support, your directs risk loosing the safety of a stable income, a fulfilling career, in some cases healthcare, and positive self-worth. Anyone who has been fired from a job can attest to how emotionally overwhelming the experience is. Even people that hated their job can get incredibly emotional about being terminated.

Your primary motivation as a manager should be to build a relationship with your direct reports. This does not mean you need to be buddies, in fact, you should not be friends with your directs. This does not mean you cannot be friendly with them.

Make an effort to engage people as individuals. Talk about what they like, what they do outside of work, what they find interesting or inspiring. The trick is you can't do this as a 1 minute conversation before requesting a deliverable from them. This small talk is transparent to most people and doesn't constitute relationship building. Instead, try taking them for lunch once in a while, ask a lot of questions and listen, listen, listen. Better yet, organize weekly one-on-ones with your directs. As an added bonus if you can retain one or two things from that conversation to ask them about later, it will demonstrate to the person that you were listening and that you cared enough to remember.

Communication is what the listener does
— Mark Horstman

Spending quality time with your direct reports is one of the most powerful things you can do as a leader. Familiarity and development of a relationship will lay the groundwork for the directs to trust you. In most cases, but not all, the trust will also build respect.

beatings-willcontinue-till-morale-improves

Managers should view their work as in-service to the team. Teams of directs serve the needs of the organization and the managers serve the needs of the team. This is a powerful change in role dynamics. Too many immature managers view their role as telling the team what to do. In many cases this leads to a relationship based on role power. People only comply with the managers demands because they don't want to be punished. This has the deceiving effect of short-term results, but does massive long-term damage to team performance. Managers that can win the teams trust and be viewed as a champion for them will be able to rely on the relationship to impact performance and affect behavior.

Look for small wins you can make for individuals or the team as a whole. Maybe it's a product they would like, a change to the schedule, training they have asked for, or an improvement to the work area they have been begging for. Whatever it is see what you can champion on their behalf. This will help to demonstrate that you are looking out for them and that care enough to champion a cause on their behalf. This has a secondary benefit of the team being more likely to raise concerns with you in the future, once they feel confident that their concerns will be heard and addressed.

Define Goals

Achievement is a powerful motivator. One of the difficulties in the knowledge economy is that quite often it's difficult to point to the results of your work. In IT for example there is an endless stream of problems. It can create thankless days of busy work, but lacks the dopamine injection of positive feedback when you can point to a finished work product. If you build a house or create a work of art, you can point to it and say, “I made that.” If you work in a knowledge based profession it's much tougher to point to your completed work product. Defining goals can help staff and businesses measure achievement. Often people get caught up in grandiose goals that are not necessarily based on the reality on the ground. Just as lack of goals can negatively impact the engagement of staff, failing to achieve goals can also be damaging.

start-simple

When starting with goals start with something simple in order to gain traction. A great first pick is often a behavioral change that you need to see from an individual. Do you need a sales person to update their funnel once a week? Do you need a tech to submit their timesheet weekly? What are those behaviors that you know they can do, but have neglected? Simple achievable goals will allow you to ratchet up expectations and set higher goals.

Metrics

Metrics are critical to efficient management. When you have the ability to see the important numbers of your business on a dashboard, you can understand if any problems exist in a matter of seconds.

In order to achieve your goals, you have to understand what behaviors will produce the outcome you expect. Goals are often a lag indicator, so you need to determine your lead indicators. For example if you set a goal that you are going to close $24,000 in new business in six months, you need to know what your weekly metrics are. A couple of examples would be number of opportunities in the sales funnel, number of client meetings booked this week, average close ratio, and average deal size.

Another example would be achieving greater than 90% SLA on all support tickets through the week. Metrics to consider would be average number of tickets opened and closed per day, number of tickets per team member, and average time spent per ticket.

Metrics or Key Performance Indicators (KPIs) are your ruler for success when making changes. Know your numbers, keep an eye on them daily, weekly, monthly and yearly in order to measure the success of your activities towards achieving your goals.

I have worked with several organizations to develop KPIs and implement dashboards that hang in their office displaying those metrics in real time. Managers and operators love this! They get a quick overview of the health of their departments or business at a glance. It has another benefit in keeping staff focused on their priorities. When the dashboard metrics go out of the expected range they turn red. This acts as a visual trigger for the person responsible for that number to take action, without being prompted by someone else. This shortcuts the time to action on those numbers and allows a kind of self directing feedback loop.

Measure success and provide feedback

Metrics also act as a fantastic management tool. Using metrics when providing feedback can move the conversation from a purely subjective view to a much more objective one. Without a metric to measure a staff members performance you may be left saying, “I need you to do better.” This is a terrible example of feedback, but this type of interaction is surprisingly common. It’s no wonder people get frustrated and immediately try to defend themselves. The defensive response demonstrates an emotional override and completely misses the point of the feedback. The direct likely feels angry and demotivated thinking to themselves, “I work really hard, how am I supposed to do more? My boss just doesn’t get it.” Now let’s try with using specific measurements. “We agreed that you would make 6-8 proactive calls a day. Right now you are averaging 3. What can you do to improve that number?” In this case the direct knows specifically what you are asking for. Even if they are defensive there is likely more room to talk about why they are not able to hit the metric. Perhaps there is some tweaking that needs to be made to their workload or scheduling. Whatever the issue is the direct will appreciate having a constructive conversation about what they can modify, instead of simply being told to do better.

Celebrate!

When you accomplish something slow down and take the time to celebrate your achievement. All too often people squander the opportunity to celebrate wins. You don’t have to make a million dollar sale to justify some high fives, a cake or a round of drinks. Positive feedback is powerful action in management. It is your best method to re-enforce a behavior you would like to see repeated, and like I mentioned before, management is about creating future behaviors. So don’t be shy about celebrating simple wins, a simple thank you goes a long way. A gift can be appropriate in some cases, gathering the team for a few words and cheer, and if the celebration is big enough to warrant it, have a party! Providing a team a vehicle to rally around an achievement can be a powerful cultural glue.

As our economy and work-world continues to evolve in to our future, we will continually be challenged by the rapid change of technology and culture. Companies that make an effort to evolve their management practices will see higher levels of engagement and innovation from their staff. I hope this framework gives you some reflection on your management practices and offers a few ideas on how you could evolve your management framework. Feel free to reach out to me directly for assistance if you feel your company could benefit from an evolved management style.