The same way I'll show you how to know it before you go away...

Hey there,

I hope you’ve enjoyed the Late Spring Bank Holiday weekend. Did you get a chance to do any reading ahead?

If you did, I hope what follows will feel a bit familiar. If not, read on…

What if there was one simple but powerful measure you could use to see how well your business serves your customers?

A measure that, once you know how to use it, unlocks capacity, empowers your team, and frees you up to spend time outside your business, without worrying about what might happen while you’re away?

That measure is time. More accurately, duration, and in this newsletter I’m going to work through how you can use time to measure business performance. I’ll look at:

Why time works as a measure of performance
What times you need to measure
How to measure the times that matter to your customers

Why time works as a measure of performance

Shortly before his death in 2012, Taiichi Ohno, father of the Toyota Production System, was asked: “What are you working on?”

His reply: “Cutting the time between receipt of an order and getting the money.”

What Ohno understood, from the beginning of his career at Toyota, was that from the perspective of both a business and their customer, the only thing that matters is how long it takes to give the customer what they want.

The customer would like to get what they want as quickly as possible.
The business would like to spend as little time as possible giving it to them.

This works because time spent doing a process is an accurate and straightforward proxy for how much it actually costs to do it.*

This is not just about cutting costs.

It’s about ensuring that every single second of the time you spend on Keeping a Promise for a customer shows up in value they are willing to pay for.

Not more than that.

Certainly not less.

And no customer wants to pay you to fix mistakes, deal with complaints, respond to chasing, clear up misunderstandings, re-do work, chase payments, or gather data.

So the work you do to deliver on your promise to them should be as clear of these things as it possiblly can be.

What times you need to measure

It sounds mad, but all you need to measure is this:

“How long did it take for us to give the customer what they wanted?”

That really is it.

Just make sure that whatever you measure yourself as giving really is what the customer wanted.

Here’s an example to illustrate what I mean:

A year ago a good friend of mine was diagnosed with a medical problem.

The problem was clear and straightforward; the solution was clear and straightforward, tried and tested.

Guess how long it took to actually do the solution and deliver the value my friend had gone to the doctor for?

13 months.

They weren’t ignored during that time. There were at least 6 interactions with A&E, another half-dozen with a specialist clinic, several deliveries of drugs and equipment to ‘manage the situation’ while they waited.

All of those interactions were brilliant. The people doing them couldn’t have been kinder, more willing, or more competent, even though they were clearly overwhelmed with demand.

It’s just that they shouldn’t have been doing any of them at all.

How to measure the times that matter

Now you know how simple the idea is, let’s see how to apply it.

Look back over your last 20 or so customers and ask:

“How long did it take for us to give the customer what they wanted?”

Measure from the time they placed the order to the time they got whatever it was they ordered. To their full satisfaction. Ask them if necessary.

You almost certainly already have a record of these events, you may even collect them automatically - in your CRM, or your accounting system, in a workflow management system - even in a spreadsheet.

Collect the results in a spreadsheet. You want at least 20 Clients, Start Date, End Date and duration (which equals End Date - Start Date).

Of course I’ve made you a KEEP PACKAGE PROMISE TIMINGS TEMPLATE to get started with.

If you only offer one product or service, in one format, the tab I’ve already set up will be enough for now.

However, if you offer more than one kind of product or service, which involves doing a different process, duplicate the tab for each Package you sell. You do need to measure them separately, or the picture you get next time will be misleading.

For example, let’s look at our old friend the Indie Gift Shop:

Most of what they offer are pre-made items, held in stock. A customer can come into the shop, pick on up and pay for it. Or go onto the website, order it, pay for it, and wait for delivery. There are two different processes here. The shop-initiated one, and the website-initiated one.
There's also a third type of product, that is made to order, from basic materials. This is a third process.
The reason for measuring at least 20 clients of each Package type is so that you can see how much variation there is (if any) between the different instances of the process.
So you would record each of these processes separately, to make sure you’re comparing like with like.
The first kind of product, bought in the shop might take between 1 and say 5 minutes to buy and take away.
The same kind of product bought online, would take a minute or so to buy and pay for, but maybe 1-5 days to deliver. From the customer’s perspective, that 1-5 days definitely counts!
The made to order product bought in the shop might take more like 30 minutes to order, pay for, receive and take away.
The made to order product bought online might not feel any different to the customer, but definitely feels different to you.

Of course it’s pretty straightforward to measure these timings when you sell physical products.

But what if what you sell is a service?

Well, a one-off service or project is still pretty straightforward. You know when it was ordered, and you know when it has been fully delivered. It’s just that the length of time between the two is likely to be longer than for a physical product.
For example, say I’m having an infographic of my services designed. We have a discussion about what I want. I place the order (pay the initial invoice). We discuss the first outline. We discuss a draft. We finalise the finished piece. I pay the final invoice. That might happen over weeks rather than days, but it is pretty clear where it starts and ends.
And if I wanted another one, we’d repeat the process, and the measurement - which is not necessarily going to be the same.

And what if your service is ongoing?

Something like consultancy or software development for example?

Well, I think you can take the ‘project’ approach again here.
My service is split into stages - Take a Week Off; Take a Month Off; Take 6 Months Off; Take a 1-Year Sabbatical. I’d want to compare customer timings for each of these separately. Even if it is for the same customer.
If you’re building software in a collaborative fashion, you could use a similar approach, where your start point is where you agree on the next chunks of value to be implemented, and your end point where the customer agrees that the value has been delivered.
If you’re a solicitor, or an HR consultant offering an ‘on tap’ service, you could measure the time between receiving a query, and getting the answer that solves the problem for the customer.
If you’re a help desk, you could measure something similar - the time between reporting a problem, and getting the problem fixed.

Once you’ve worked out what to measure, do it.

Measure timings for at least one of your Packages, perhaps the one you sell most of. Record the results in your KEEP PACKAGE PROMISE TIMINGS TEMPLATE Sheet.

Then have a look at what you’ve recorded.

What do you notice?

If you’d like help working out what to measure, for yourself or for one of your clients, or you’d like to share what you’ve noticed, just get in touch.

Here’s what I hope you’ve learned today:

What matters to your customer is “how long it takes for them to get what they really want”. That means the way to measure your performance is simple. The longer it takes you to give it to them, the more it costs you.
You must measure the time to deliver what really matters to your customer. What they want, not what you’re prepared or able to give them.
You almost certainly already have the data. You just don’t look at it this way.

Next time, I’ll walk you through how to build on use these measurements to track the ongoing health of your Keep Promise process, using some simple maths and a useful tool. Hopefully you’ll start to see just how powerful this idea is. And how much ‘management’ time it saves you and your team.

Before I go, let me reassure you, you already have a successful business, otherwise you wouldn’t be dreaming of being able to leave it.

But learning to measure business performance this way, keeps things very simple, which is what you need if you’re going to check things from the beach or decide you’re going to go for growth.

What’s more, it’s so simple, that once you’re familiar with it, you’ll be able to share the information and how to create it with your team so they too can take responsibility for improvements.

In other words, it’s a key tool in helping everyone in your business to become a Boss. So you don’t always have to be there.

So, get measuring. And you want help, just ask.

Thanks for reading!