The proper implementation of a North Star Metric (NSM) brings focus and clarity to a company’s strategy and allows that strategy to be communicated to all stakeholders. This blog explains the idea and gives an example of implementing strategic KPI reporting at Transpoco, culminating with the identification of their NSM. This is now the key metric used to drive the growth of the company.
The history of navigation using stars goes back to Homer’s Odyssey. In the Northern Hemisphere, navigators have traditionally used Polaris (the North Star) to guide them on their journey and to help them reach their destination. The North Star Metric plays a similar role in business.
“The North Star Metric is the single metric that best captures the core value that your product delivers to customers. Optimizing your efforts to grow this metric is key to driving sustainable growth across your full customer base”.
Sean Ellis CEO/Founder GrowthHackers
Transpoco North Star Metric
Transpoco develop a range of fleet management apps that helps business owners with light fleets to manage their vehicles from a control, safety, compliance, maintenance and fuel perspective. Transpoco implemented ServiceClarity to measure the KPI’s that they use to drive their business. See www.serviceclarity.com
Andrew Fleury, CEO of Transpoco
“Before implementing strategic KPI reporting, we had a significant challenge in seeing the wood for the trees. We knew we had all the data, but it was administratively very expensive for us to pull everything together. Due to time constraints, we were not looking at our numbers enough and we ended up focusing on the metrics that were easiest to measure.
The biggest shift for us since implementing strategic KPI reporting is the realisation that we have been focusing on the wrong things in terms of the fastest route to growth. In the past, the main number for us was the number of new vehicles per month.
We then moved on to consider the Transpoco North Star Metric and in the end, we selected Active Vehicle Applications i.e. number of vehicles multiplied by the number of active Transpoco Applications that they use. Optimizing our efforts to grow this metric increases strategic focus and is driving sustainable growth for the company”.