One Constraint, Two Metrics

Somebody on my team last week quoted my own content to answer a question that I was I was asking and I thought all right first of all awesome because half of the content that I create is actually for myself it's for our own business it's things that I'm learning and reaffirming as I as I go. But in this particular case the application of it like taking that piece of advice and and applying it where we were talking would have been counterproductive. And so what I want to do is actually go back and readdress that uh because if anyone else applies it the same way and it's it's completely on me because when I go back and look at the message I go yeah I can 100% see how this was interpreted this way and how it would be used this way but it won't actually move your business forward and it wouldn't have for us so I'm gonna go back and clarify that and make it useful with the the context that's that's necessary. So the gist of this is we are we're looking at our 2026 content strategy. And you know we were looking at what metrics we should measure. You know like what's a simple scoreboard that we can determine you know whether we're we're moving a needle where we want to move it. The piece of advice or the the content that was suggested to me from me was well hey Ray you talk about one thing. Like one constraint, one focus, one thing so why don't we pick one metric and let's focus in on that and lock in on that based on you know the advice that that you have given. And it's a again I can see how the applicability of it is like you would think you could use it here. But when it comes to to the one thing the the clarification that I need to add to this is I'm talking about one constraint. Like one core problem that you're trying to solve. One core focus that needs to be addressed in the business to keep it moving forward right like in a business is just one big complex system and within that system you've got these different levers these different variables these different inputs and all these things that are happening and the the objective is to find the core constraint the thing that's keeping it from moving forward the most focus as many resources as you can on that and use two metrics to measure progress. At least two metrics to to measure progress. So one constraint two metrics. And the reason I'm I'm pretty adamant about one constraint is in virtually every business no matter how big you are but especially in small businesses your your resources are are limited right like your energy your time your money your manpower everything that you have is extremely constrained and so what happens is you know founders and business owners have all these big ideas and these big ambitions and they go try to solve three four five big problems at the same time or tackle three four five big initiatives at the same time and what happens is they end up with diluted efforts because you're spreading those resources out across multiple things. And because of that either your progress is really slow because if you're attacking four things I promise you three of them maybe four but at least three of them are not the biggest constraint in the business which means you're spending one quarter of the time and and resources that you have on the biggest thing and three quarters of your time on things that are important and maybe they are issues and maybe they are opportunities but they aren't the biggest ones they aren't going to move the business forward the fastest. So if you can direct all of your resources on the one that's going to have the highest impact you're going to solve it faster you're going to get the most leverage in your business you'll create the most velocity. So that's the importance of one constraint. But in order to measure whether you're moving the needle on that one constraint and whether you're actually addressing that one constraint you want at least two metrics and the reason you want two metrics is you want those metrics to compete with one another. You want one to balance the other because in almost every circumstance what you're gonna have is uh the ability to kind of manipulate the number and get the number that you want but not get the result that you want if you don't have a balancing metric right. And I've seen this a lot right so at the at the chamber we had a deal with you know it was like Ray we want you to to generate a lot of revenue and so what I found was the the fastest way to generate a lot of revenue was to go to the biggest people that had the highest propensity to give and get them to give more so I would I would significantly increase revenue but in terms of member renewal rates and other factors in the business they they had the potential they were at risk of falling even though money was going up. So what you wanted was you know maybe it was membership count and revenue um and this is really common like so you take like sales. You don't want if you say hey we need to increase our close rate and everybody focuses on their close rate well what happens if you just get myopically focused on that is you start finding ways to move the needle on that metric without getting the actual result you want which is actually more sales at the end of the day right. So you want more you want a higher close rate because you want more sales but if you only measure the close rate that's not necessarily what you're gonna get in the long run. What you're gonna get is sales people like disqualifying calls you're gonna get people not getting them to a certain stage where the conversion is measured you're gonna get weird dispositions and calling it something other than not a sale so what you want is you say okay close rate and revenue per sale or you know total revenue or something to balance that metric effectively something to to compete with that metric and hold it in order. With BDRs we do a lot with our with the SDR program that we have for for inside sales reps. You can get I mean you can set the only target at appointments set but if you do that you're going to get a bunch of garbage appointments right you're gonna get shitty show rates you're gonna get people that aren't qualified you're gonna get people that didn't even know they were showing up like all this other stuff so you need a qualitative metric to hold that in check right. So you have like appointments set on one side and then you can do you know sit rate on the other side or even better you can do um conversion to the next stage right because that tells you whether you're you know are they showing up and are they the right people all these other things so you think what's the metric that I think I need and then you I I look at it and go all right how would I game that like even if peop people aren't doing it maliciously how would I game that if I wanted to in a way that still wouldn't move the business forward and then how do I how do I adjust for that. Um and again it's not I don't mean people do this maliciously but if you tell them to hit a target if you can't blame them for doing whatever they need to do to hit that target so it's up to us to set the right metrics. So in in our case you go back to like content and you go okay well this happens all the time you can just do um you do followers or you could do impressions or views like right just a volume based metric. But what if those ne none of those people are in your target market what if none of those people ever buy your shit what if none of those people ever engage with your content what if they never actually watch it like what if you have a hundred thousand YouTube subscribers and three views per video like is that what you want so you know you have something on one end like like views or or followers and then you have something on the other end like engagement or leads or something to to effectively say volume and quality quantity and and quality. So solve one problem address one core constraint and and do that measure your effectiveness and your progress in doing that with two competing metrics and if you if you do that you're gonna get all of the resources focused on the thing that matters most which is gonna you know increase the the growth of your business like you're gonna remove the biggest problems the fastest and most effectively you're gonna take advantage of the biggest opportunities uh most quickly and um actually see them through and execute uh so one focus and at least two competing metrics so came up in our business thought I would come back clarify it here I hope it's been helpful adios.