While running a business that thrives to the point that it grows is every entrepreneur’s dream, identifying strategies that actually achieve this may be less straightforward.

While growth typically necessitates increased costs, scalability is the ability to increase output or revenue without increasing costs at the same rate.

North Star metrics
A North Star metric is the single most predictive measurement of a company’s long-term success, and it fulfills three criteria necessary for sustainable growth:

  • Leads to revenue
  • Reflects customer value
  • Measures progress

A North Star creates an environment in which every employee is working toward a single, larger goal and can draw a clear connection between their daily tasks and that goal.

To find your North Star metric (i.e., customer satisfaction; generating profit; or measuring overall progress), it’s necessary to identify what is truly essential to your business.

Consider the following questions:

  • What is essential to my business’s functioning?
  • What KPIs and metrics measure the top few key factors?
  • What metric encapsulates all the above?

Write down your answers in list form, gradually building a metric hierarchy with the North Star metric at the very top of the pyramid.

The ‘One Metric That Matters’
While a North Star metric is a long-term guide, the ‘One Metric That Matters’ (OMTM) is for specific teams and projects over a fixed period of time. An OMTM can strengthen your North Star metric by accelerating short-term goals.

Your OMTM is defined as the figure you expect will have the most significant impact on your growth over the next 2-6 months. Once identified, every marketing task and growth activity should be focused on improving this figure over a given period.

Consider following these steps to help you find your OMTM:
Focus on the area where you can make the most impact—often the area that performs most poorly. Try the Pirate Funnel (a framework that helps you view your company in distinct pieces—Awareness, Acquisition, Activation, Retention, Referral, Revenue).

Set a S.M.A.R.T. goal—one that’s Specific, Measurable, Attainable, Relevant & Timely.

Ask yourself, “is this experiment going to contribute directly to our OMTM?” If the answer is no, don’t prioritize it.

Stuck for ideas on how to scale your business? Learn and be inspired from others’ definition of success, like Lindt Chocolate in Carrefour Laval:

North Star: foot traffic;
OMTM: percentage of online coupons used at the store (in line with conversion).
Need some extra guidance? Book a consultation with a YES business coach today!