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Keep it Complicated

How many orders did we take last week?
How could such a simple question start so many board room arguments? Yet it does, and not because companies don't know their numbers, and not because companies lack a unified dashboard with definitive answers. The reason is: the answer isn't simple. Considerations when counting orders:
  • Do you count orders that are placed but not yet shipped?
  • What about completed orders that are subsequently canceled?
  • Do you count back orders?
  • If someone calls back and adds on to an order is that one order or two?
  • Do you count orders made on credit or installments before they're paid in full or after?
  • How do you count returns?
Your answers to these questions will depend on your role in the company. The operations folks are interested in call volume, and boxes shipped; the accounting folks will focus on money in the bank; the merchandising folks and marketing folks have different facets of the business to tune and must look at these numbers differently. I'm not saying that every discussion needs to be down in the weeds of the details. Arguing over whose numbers are "right" is a waste of time. There are plenty of instances when agreeing on the definitions in advance makes sense to simplify higher-level discussions. I am saying that this shouldn't be the only way of looking at the data. Each department needs to focus on its own customized view of the business, not to the exclusion of other perspectives but to enhance their understanding. Simplifying and unifying the company's view of numbers is dangerous. There are good reasons to look at the numbers from different angles and with different agendas. I use order counts as one example. The same notion applies to each marketing program and the inter-relationship between them. The unified view is important, but it shouldn't be the only view. Business is complex. Reducing the complexity means losing valuable information. Sweeping the details under the rug of a dashboard serves no one's interests.
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