Outcomes Over Output: Why customer behavior is the key metric for business success

by Josh Seiden

You can manage a team by asking them to target some high-level value, like growing revenue. That’s called managing impact. It’s a problem because it’s not specific enough. What you want is to manage with outcomes: ask teams to create a specific customer behavior that drives business results. That allows them to find the right solution, and keeps them focused on delivering value.

When you combine outcome-based targets with a process that’s based on running experiments, you really start to unlock the power of agile approaches.

What you want is to manage with outcomes: ask teams to create a specific customer behavior that drives business results. That allows them to find the right solution, and keeps them focused on delivering value.

To find the right outcomes to work on, we start with a simple question: “what are the customer behaviors that drive business results?”

because outcomes are things people do, they’re both observable and measurable. This is an incredibly important part of outcomes because it lets us use them as a management tool.

What are the user and customer behaviors that drive business results? (This is the outcome that we’re trying to create.) How can we get people to do more of those behaviors? (These are the features, policy changes, promotions, etc that we’ll do to try to create the outcomes.) How do we know that we’re right? (This uncovers the dynamics of the system, as well as the tests and metrics we’ll use to measure our progress.)

What are our customers trying to do? How do they do that today? How can we make it easier for them to do that?

It would be better to instead measure progress in terms of new organizational behaviors created by their work. For example, what is the ratio of users of the new system vs the old system? How many of those users are able to use a new business process as a result of the initiative? Are the new business processes unlocked by this initiative ones that in turn generate positive outcomes?

remember: outcomes are the behaviors that drive business results.

If we create this outcome for the user, it will deliver this outcome for the business.

Your colleagues are your customers. Everything is an outcome. Everything is an experiment.