Jul 28, 2021
Data is an abstraction of reality
Developers and management are obsessed with measurement. Important things, many times, are not qualitative. But, when we insist on measuring, We end up measuring unimportant things.
For example, companies that don’t understand their customers become feature factories. For them, quantity becomes a proxy to measure value.
An extreme example of this obsession with data is hospitals, their patients are numbers, digital readouts, and test results. Nurses only spend one-third of their time on direct care. Remain two-third is spent on documentation and medical record keeping.
It is hard to define Value for customer
First, let's understand what value means. There are two types of “Value” that a software team delivers, First, value for the company such as more profit, more data or insight, promotion, and knowledge capital. Second, value for the customer, which is a solution to a problem or fulfilling a want or need.
Defining the “value” for a customer is hard. There is a social, emotional, and functional aspect that needs to be considered.
For example, I might choose to buy a physical, kindle, or audiobook depends on where I intend to use it (home, flight, commute). It might also depend on whether I have kids.
Asking customers also do not help, Customers can’t always articulate what they want, even if they do, their actions might tell a different story.
An example, If you ask new parents if they care about the environment, most of them would say yes, but they also stock up disposable diapers instead of cloth ones. Similarly, existing customers might choose to opt for a totally different product in different circumstances.
Difficulty in knowing the Value has huge implications on how we measure it.
The right way to measure
When companies don’t understand their customers, it is hard for them to define and measure values for customers. Such teams are more likely to become feature factories. For them, quantity becomes a proxy to measure value.
However, We can define and measure “Value” for customers if we pay attention to two kinds of data.
- Active data: We primarily focus on this data as a way to know product usage and customer behavior pattern. This data is loud. It is easy to get wrong, People start focusing on numbers and forget that data is an abstraction of reality, not the reality itself.
- Passive Data: Unstructured, unfiltered, un-tabulated data containing the struggle of customers. To get anything out of this data, innovators have to immerse themself into the context — the real messy context of life to figure out what potential solution could help customers.
Having metrics such as customer conversion, retention might make us feel good, But it does tell us why, It doesn’t give us insights into what was the customer trying to do, why they were not able to do it.
Important things, many times, are not qualitative. Often, we have no idea what they are. But, when we insist on measuring things, We end up measuring unimportant things.
The only solution, I think, is to immerse yourself into the messy context of life, watch how customers use your product, watch their struggle and work backward from there.
