Data centric ≠ a spreadsheet.

I don’t know when it happened. Somehow we all collectively decided that being data-centric meant staring at tables full of numbers. As if they were tea leaves in some fortuneteller’s cup.

But I just sound grumpy. And you still need KPIs and metrics to understand what is happening with your product.

Let me show you how to do that. Without the spreadsheet.

I like metaphors. I like systems. So I’m going to give you a metaphor of a system. I’m going to give you a marinade recipe.

A Recipe for a Marinade

A good marinade needs 4 things to work: fat, acid, salt, and spices. It doesn’t matter which ingredient you use. For example, you could use olive oil, yogurt, or buttermilk for your fat; it all works just as well. As long as you have the 4 basic components, you’ll be working with a great marinade. On top of that, you also can now improvise and make something unique and tasty for any occasion.

Product metrics and KPIs are similar. You could try to memorize or look up recipes for every type of product. It would probably work. But you’re stuck painting by numbers, not really understanding why you’re doing what you’re doing.

Today, I want to teach you to really cook. (Well not literally, but like in a product manager sense.) We will …

1. Go over the 4 parts you need to have a solid data-informed KPI metric strategy for any product

2. Give you a working definition for each

3. Discuss how they interplay with each other.

I first learned this from the Fit for Purpose framework (it’s a book too). I’ve made some adjustments. I disagree on some parts. But the core of what I have here is a direct descendant from their methodology.

Let’s get into it.

Your Metric Recipe

The 4 ingredients to every product’s KPIs are …

• A North Star metric

• Improvement metrics

• Health metrics

• Storytelling metrics

The North Star metric is the number version of the purpose of your product, your raison d'etre so to speak. They help you rank your roadmap over the course of months, quarters, and years. Additionally, they show you if you’re gaining traction with your product.

The Improvement metrics are numbers that react quickly to any actions you take (good or ill). These metrics help you prioritize in the short term. When designed well, they help you figure out if the thing you shipped last week actually works.

Health metrics are ranges of numbers that show you the overall health of the product. This includes both technical health (my servers are alive) or UX health (my users are engaged and productive). Its key trait is that this metric is always a range of expected behavior. If your metric goes above or below the expected range, you know you need to investigate.

Storytelling metrics are numbers that are not useful day-to-day. Instead, they help you tell the story of your product. They're also called vanity metrics, usually in a dismissive tone. But I say they are useful to help you inspire coworkers, leadership, and investors.

Better Together

All 4 “ingredients” are necessary to give you a 360-degree view of your product. Together, they answer the questions …

• Are you headed in the right direction over the long term?

• Are you headed in the right direction over the short term?

• Is your product broken?

• And why should I be excited about your product?

tldr

Let’s wrap this up and bring it all together. Here’s a helpful table!

Now go forth and be more data-centric!