Measure What Matters to Customers: Using Key Predictive Indicators (KPIs) [Hardcover]

Ronald J. Baker (Author)

Book Description

Publication Date: October 6, 2006 | ISBN-10: 0471752940 | ISBN-13: 978-0471752943 | Edition: 1

Measure What Matters to Customers reveals how to capitalize on Key Predictive Indicators (KPIs), the innovative measures that define the success of your enterprise as your customers do. If you want to increase your company's profits by working smarter, this is the book for you.

Editorial Reviews

From the Inside Flap

Learn why the most important activities that actually matter in your business are those that impact your customers.

One hundred years ago, the traditional accounting measures of costs, activities, efforts, and inputs met the needs of that era's businesses. But today, these internal metrics are narrow in their focus and have become less meaningful in the knowledge economy, with little effect, in the long run, on an organization's bottom line. Compelling and bold, Measure What Matters to Customers lays out an exciting, new road map for measuring customer value and successfully raising profits.

With proven methods, Ron Baker—renowned forward-thinker in the professional services firm field—shows you how to capitalize on Key Predictive Indicators (KPIs), innovative measures that define the success of your enterprise as your customers do. These are specific, identifiable details that customers value in the products and services they receive—details such as a preference to be contacted by phone instead of by e-mail, or a desire for rapid turnaround time on returned calls. Easy-to-read and relevant to your organization's bottom line, this groundbreaking book shows you how to use KPIs to, for example, effectively track marketing data to determine which customers respond well to things such as cross-selling or to find out how receptive other customers are to entirely new offerings from the firm. It also shows you how to employ KPIs to enable your firm to react appropriately to your customer's needs and increase the value they perceive, leading to higher profits. Topics covered include:

• Why the traditional metrics are no longer relevant to measuring the effectiveness of knowledge workers
• The new tectonic shift taking place in the economy—the transition from manual and service workers to knowledge workers and why that difference is critical to the future of your business
• How what you measure affects the value you provide to your customers
• How to increase the effectiveness of knowledge workers
• Developing KPIs for your company
• Increasing knowledge worker effectiveness

Seismic in the strategies it presents, Measure What Matters to Customers reveals how to regain a competitive advantage in the marketplace and allow your company to develop the measures that matter to your customers. Applicable to manufacturing and service businesses of all sizes, this important book will challenge managers' and executives' theories about which measures are important in their businesses. If you want to increase your company's profits by working smarter, this is the book for you.

From the Back Cover

Praise for Measure What Matters to Customers: Using Key Predictive Indicators

"From his wit to his insights, Ron Baker has done it again! As one of the best management thinkers of our time, he has taken on the field of measurement and given us the gift of knowledge so we may move ahead as well."
—Reed Holden, founder, Holden Advisors Corp., www.holdenadvisors.com, coauthor, The Strategy and Tactics of Pricing

"Baker's book evolves the rationale for defining the success of a business the same way the customer does. With impeccable logic, he leads the charge for effectiveness over efficiency by shining the spotlight on the realities of today's knowledge economy. Measure What Matters to Customers is a Rosetta stone for leaders who are trying to translate what they measure into value for the customer."
—Thomas Finneran, Executive Vice President, American Association of Advertising Agencies

"I have read literally hundreds of business books and no author has entertained, educated, challenged, and extended my thinking more than Ron Baker. Ron is a gifted storyteller who, in a disarmingly simple way, shares with his readers an extraordinarily powerful message. In Measure What Matters to Customers, Ron provides us with an elegant justification, together with a practical framework, for developing metrics that truly reflect what's important to the people who, at the end of the day, determine the destiny of any organization—its customers. If you play a role in contributing to the success of any entity, whether it is a for-profit or nonprofit, you and the organization you serve will benefit immensely from this book."
—Ric Payne, President and CEO, Principa, www.principa.net

"We have known since the 1960s, when Xerox did extensive research, that employee satisfaction - customer satisfaction - profitability, yet the vast majority of companies measure only the latter. Why? Because we have a learning disability, that's why! In Measure What Matters to Customers, Ron Baker slaps us in the face with a generous dose of logic to help us correct our blind wandering through the labyrinth of lagging indicators like revenue and profitability, in favor of key predictive indicators that define success the same way our customers do. Hmmm, maybe we will get it this time?"
—Ed Kless, Director, Partner Development and Recruitment, Sage Software

"Ron Baker has done it again—this is the most helpful business book that I have read. In it, Ron continues his relentless focus on customer value, challenging the reader to rethink their definition of success. It provides both a solid theoretical foundation and proven practical steps that can be implemented in your business today to become a truly customer-focused organization. Lead your organization to the next level by measuring what matters to customers."
—Brendon Harrex, Chairman, Ward Wilson Ltd., Invercargill, New Zealand

"Yet more insights from Ron Baker that force us to challenge conventional norms—norms that keep us missing the really important stuff. Read this book and discover that there absolutely is an opportunity to move way beyond where you are now, into new realms of real relevance—indeed into new ways of delivering a far better customer experience. Yet again, Ron Baker provides a fabulous pathway."
—Paul Dunn, founder and CEO, ResultsNet Australia, www.resultsnetaustralia.com, coauthor, The Firm of the Future: A Guide for Accountants, Lawyers, and Other Professional Services

See all Editorial Reviews

Product Details

• Hardcover: 208 pages
• Publisher: Wiley; 1 edition (October 6, 2006)
• Language: English
• ISBN-10: 0471752940
• ISBN-13: 978-0471752943
• Product Dimensions: 9.1 x 6.3 x 0.8 inches
• Shipping Weight: 14.4 ounces (View shipping rates and policies)
• Average Customer Review: 3.9 out of 5 stars  See all reviews (7 customer reviews)
• Amazon Best Sellers Rank: #652,370 in Books (See Top 100 in Books)

Customer Reviews

Most Helpful Customer Reviews

5 of 5 people found the following review helpful:

5.0 out of 5 stars Useful, insightful, and right on target - a great business read!, January 17, 2007

By 

J. Thomas Hood III "CPA!" (Towson, Maryland) - See all my reviews
(REAL NAME)   

This review is from: Measure What Matters to Customers: Using Key Predictive Indicators (KPIs) (Hardcover)

Ron Baker's latest book is a winner. The "Value Pricing" guru is back - this time with a great book on measuring what matters. Ron makes the case that we are measuring from the wrong perspective as we look backward (lagging indicators) and from the inside (busines operations point of view) when we should be looking forward (leading indicators) and outside-in (from the customer's perspective).

Ron challenges the status quo and backs it up with great stories of great companies and a good historical background of peformance measures. I love his theory for the new formula of business : Profitability = IC (Intellectual Capital) x Effectiveness x Price. He then goes on to explain the three components of Intellectual Capital as Human Capital, Structual Capital & Social Capital. This new framework explains the new value creation companies and how to transform your business into a value creating machine. I recommend this book highly!

2 of 2 people found the following review helpful:

4.0 out of 5 stars Just the first few chapters alone are worth the time and money, October 4, 2009

By 

Rags Srinivasan "Rags" (Colorado) - See all my reviews

This review is from: Measure What Matters to Customers: Using Key Predictive Indicators (KPIs) (Hardcover)

This is a very well written book with analytical take on things. Baker insists on the need for theory, that can be tested and improved on, over fads that do not stand on data. It is refreshing to see a author who evangelizes the importance of profitability over market share and the need for businesses to leave the the cost-plus mentality in pricing. I recommend this book for all marketers and decision makers.

1 of 1 people found the following review helpful:

5.0 out of 5 stars Makes Your Head Spin - Why don't all organizations do it this way?, August 26, 2011

By 

Stephanie (Des Moines, IA) - See all my reviews

This review is from: Measure What Matters to Customers: Using Key Predictive Indicators (KPIs) (Hardcover)

I think the beauty of this book is how author Ronald J. Baker brings life to data through effective storytelling and understanding that emotions and people matter ... not what one might expect from an accountant.

Too often organizations get trapped into the status quo, continuing with the way things have always been done. This includes the data we use to gauge our success.

Baker's engaging style and relevant examples prove why we need to re-think this.

It's easier and easier to get data - making organizations dependent on all the numbers. It's rare that companies step back to look at that data and assess whether they're measuring the right things. Baker questions if organizations do enough to adapt to their customers' changing needs.

He proves why organizations need to have the courage to look at both their quantitative data and the qualitative information that bring the numbers to life. We can't lose sight of how important it is to include creativity and critical thinking when analyzing numbers. It's not enough to just look at the data we're already getting, we need to have the courage to question it, to let our intuition guide us ... and then back that up with data to prove or disprove our theories.

Analytics are a means, a tool to inform our decision-making. However, organizations need the creativity of the human element or else they will stagnate.

I appreciated Baker's combination of both 1) the theory and data behind his assertions AND 2) his ideas for specific actions companies can adopt. I disagree with the reviewer who felt Baker just recycled other stories and examples. Baker has some strong opinions on what we need to do differently to be profitable. I felt that he chose great stories and research to back up his original ideas.

My only criticism would be that there are so MANY valuable ideas it's somewhat hard to determine where to focus. Related to re-thinking what we do with our data and information, he also makes a strong case for the importance of knowledge management and engaging employees. I started reading this thinking it would be only about data but it's really a book on building a stronger organization overall. Since we can't boil the ocean (cliché, sorry) it would be helpful to understand the logical order in which to tackle all of these important concepts.

The best books change one's thinking. This one changed mine.