In this blog series, I’ll be breaking down some common and uncommon methods for measuring business requirements.
Inspired by a session I attended at the 2018 Digital Analytics Hub Conference, I had a chance to think about how we sometimes gloss over the contribution that requirements make to the overall success of analytics initiatives. Teasing out how the details influence the big picture is a skill we all can always improve upon.
In this post, I want to dive into one of the most popular Requirements Gathering methods in consulting:
Identifying Business Initiatives and Business Objectives
I’ll cover the key questions to ask when considering this method and then review the pros and cons.
Key Questions to Ask
- What are the business initiatives and business objectives?
- Business Initiatives are where you invest time and money. They are what you do or plan to do. It’s helpful to think of these as nouns, not verbs. They are things that perform the action – not the action themselves.
- Business Objectives are what your initiatives are intended to accomplish. What are your desired outcomes? These are the verbs.
Let’s apply these to an example.
You are a Marketing Analyst and are working with the Marketing Manager of a hotel brand which is about to launch a new resort.
The marketing team has several planned business initiatives to support the launch, including email newsletters and look-a-like audience targeting with paid search.
Driving hotel bookings for this new resort is the primary business objective. You likely have others which ladder-up to the top objective, like brand awareness and hitting a target Cost per Acquisition (CPA).
- What are the KPIs and targets?
- KPIs (Key Performance Indicators) tell you how well your initiatives have accomplished their objectives. They can be any metric which informs how successful an initiative is at meeting its objective. Common KPIs in the digital analytics world are things like Conversion Rate, Bounce Rate, and Click Through Rate.
- Targets represent the actual number which will increase or decrease as a result of the KPI performance.
With the resort example, the primary KPI is the number of bookings for 2+ nights and the target is at least 1,500 bookings of 2+ nights per quarter.
For Q1 specifically, the resort needs to sell at least 1,500 bookings of 2+ nights. Individual initiatives may have KPIs which ladder up to the top-level KPI, like Cost per Conversion.
Setting targets for your KPIs allow you to measure your progress towards a goal and optimize for performance.
- Can you confidently track the success of your Initiatives, Objectives, and KPIs?
For the resort example, being able to track hotel bookings back to the channel that drove them is necessary for measuring success.
During requirements gathering with the Marketing Manager, you check the hotel booking system and discover that all bookings come in with a single channel code. You can measure the success of your top-level KPI (the number of 2+ night bookings) but cannot tie channel performance to that.
Whether you have plenty of time or are working under a tight deadline, you should prioritize the requirements that are most critical to the success of your project. Once you recognize a major gap in the tracking that is needed to measure your success, prioritize that and work to get it addressed.
Pros and Cons of the Grammarian’s Approach
- Pros
- Structured: The nouns/verbs/numbers approach gives you a structure to work from and is easily explained to others with different experience levels.
- Visual: You can easily create a spreadsheet with initiatives, objectives, KPIs, targets, and other key elements as columns and fill in your values as you go.
- Cons
- More complicated for larger projects: The resort example was straightforward and had only one primary objective. In real life, projects tend to be much more multi-faceted.
- Longer process for larger projects: As more stakeholders are incorporated, the list of initiatives, objectives, and KPIs will inevitably grow. It can be difficult to keep the big-picture in perspective and to keep everything organized.
If you enjoyed this post or have questions, connect with me on Twitter at @caitlinmariemcc or email me at caitlin.mccluskey@cardinalpath.com.
Check back next week for our 2nd installment in this series, “Track All The Things!!!”
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