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

by Josh Seiden

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

the feature must be in the service of changing something.

Tracking Progress with Outcomes

leaders and the folks who execute the work tend to think of value at different levels of specificity.

Leaders think in high-level terms—appropriate to their level in the organization. Executors think in much more detailed terms—again,

leaders think about impacts, and executors are responsible for o...

When leaders have teams that are working with well-defined outcomes, tracking progress becomes simpler—leaders and teams can review the hypotheses the teams are working on, they can review their progress towards the outcomes they’re seeking, and they can look at a concrete measure: are people’s behaviors changing?

Getting Started with Outcomes

In most situations, initiatives are not planned in terms of outcomes.

Instead, they’re much more likely to be planned and tracked in terms of features built, or in terms of how they’re tracking to some promised delivery date or other milestone.

“what (user/customer/employee) behaviors has this initiative created that are driving business results?”

Writing Better OKR with Outcomes

OKRs are popular because they help you connect your work to the big picture (the Objective) and they help make sure that you’re not just making stuff or doing work for the sake of doing work.

So how do you write better OKRs? One way is to think of Key Results as outcomes.

Takeaways for Managers

Don’t mistake impact—high-level aspirational goals—for outcomes. Impact is important, but it’s too big for any one group to target. Use the magic questions to define outcomes: what are the human behaviors that drive business results? How can we get people to do more of these things? How will we know we’re right? Remember that by “humans” we mean customers, users, employees, stakeholders, or anyone involved in the system that we’re building. When you’re planning work, be clear about your assumptions. Be prepared to test your assumptions by expressing work as hypotheses. Test your hypotheses continuously by working in small iterations, experimenting, and responding to the data and feedback you collect. Use outcomes to track progress. Leading indicators tell you that you’re going to hit or miss your target. Lagging indicators show your target. Build an understanding of what behaviors lead to achieving the targets you seek. Use outcomes (not features) to plan initiatives. Ask “what new behaviors will this initiative create that will deliver business value? How can we deliver that value sooner?” OKRs can be improved if you think of the Key Result as an outcome.

Roadmap to Nowhere

Few things cause more frustration in product organizations than roadmaps.

Typically, roadmaps are nothing more than lists of features and projects that technology teams have promised to deliver someday.

Roadmaps are supposed to help organizations manage uncertainty—they

The problem is that most of the time, the answers that make it to the roadmap are guesses, fiction, or lies.

The Root of the Problem: Output-based planning

Roadmaps fail when they present a picture of the future that is at odds with what we know about the future.

work they plan to undertake has a similar quality: it’s filled with uncertainty, unknowns, and perhaps unknowables.

A better solution: plan around outcomes

Instead of building plans around the outputs that you’ll make, it often makes more sense to plan around themes of work, problems to solve, or outcomes to deliver.

planning a roadmap around a customer journey.

we’re trying to visualize human behaviors, and customer journey maps are designed for exactly this purpose.

Mapping The Customer Journey

you make a diagram that reads from left to right and describes what people are doing (their “journey”) when they interact with your product or service.

Building this diagram (sometimes called a “map”) lets you and your team visualize what people do with your product or service. It lets you visualize behavior.

a customer journey map lets you see the behaviors in the system, which means that you can start to think about which behaviors you want to encourage, which behaviors you want to eliminate, and which ones might be missing.

Case Study: Improving NPS

Net Promoter Score or NPS, is used to assess the likelihood of a customer recommending your product or service to others.

NPS is an impact.

we needed to break that impact down into smaller parts: we needed to identify the outcomes that would contribute to increased customer satisfaction. Our first step was to try to understand the current state of the service and see what was creating satisfaction today—and conversely, what was creating dissatisfaction.

Next: Boosters and Blockers

we then went back through the map and asked our magic question: “What behaviors at each step predict success and satisfaction? And what behaviors at each step predict failure and dissatisfaction?”

Goals Transformed: A Roadmap of Questions and Hypotheses

goals are outcomes: they are very specific and measurable rates of behavior.

express the roadmap in terms of the questions we were trying to answer.

We think we can increase the rate of early meetings [with this idea] and [with this idea] and [with this idea.]

Takeaways for Managers Planning with outputs limits teams’ agility and problem-solving flexibility. Increase teams’ capabilities here by planning around outcomes Create outcomes-based roadmaps that list questions, themes, and outcomes instead of features. One way to find outcomes is to create Customer Journey Maps. These maps help visualize how systems work in terms of customer (and employee) behavior, and so can help you find important outcomes in the system.