Focusing on metrics is key to achieving your desired business results—but it can be difficult to determine which metrics actually matter. There are five major questions you need to answer to ensure the metrics you’re measuring matter, and that you can take action based on what they tell you.

Some metrics are easy to put numbers to. Revenue, inventory levels, and customer retention are solid numbers. Knowing those quantitative measures is essential to understanding your business. That said, you also need to measure qualitative aspects of your business like associate engagement and customer satisfaction.

Regardless of the measurement, you need to answer five things about it.

1. What’s the measurement’s purpose? Know the significance of the metric and what you’ll change in your business based on the numbers you measure.

2. What data source will you use? Different sources of data can yield different results.

3. How will you calculate the metric? Define a formula, especially for complex measures.

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