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Stats are for Losers

 

Cold Hard Football Facts mascotLast week’s Monday Night Football game featured a defense that was statistically among the worst in the National Football League. As the announcers and analysts pointed out, the New England Patriots ranked 32nd of 32 teams for pass defense, first downs allowed and third-down efficiency. New England went on to have its best defensive game of the year, holding the visiting New York Jets to 3 points.

The announcers, like many business people, were paying attention to the wrong stats. Two of the key stats they should have been focused on:

  • Turnover differential - The defense forced 3 interceptions, and the Patriots are 9-0 when they force more turnovers than giveaways. In their two losses, they gave away the ball 5 more times than they took it away.
  • Yards per Point Allowed - While the Patriots defense gives up a lot of yards, it often keeps offenses out of the end zone. One measure of this is Yards per Point Allowed – the Patriots are 8th in the league for YPPA, which Cold Hard Football Facts calls the Bendability Index, and all but two of the top 8 YPPA teams are playoff contenders.

Once, when asked what stats are important to him, New England’s coach, Bill Belichick, famously said, “You know how I feel about stats. Stats are for losers. The final score is for winners.”

The key lesson for market researchers is to make sure that we are measuring the statistics that build winning businesses. What customer metric is most predictive of customer loyalty for the firm we are working with? NPS works well for some industries, but it works very poorly for others, especially B2B organizations. Traditional customer satisfaction is a better measure for many organizations, but some consumer brands may find measuring “Liking” produces the best results.

Track the stats that matter, or lose.

See also:

Comments

It's odd that you talk about the importance of measuring meaingful things in terms of business, but then you suggest metrics (like or satisfaction) that are not, and really no different from what you are trying to criticize. 
 
Unless, of course you can prove that liking or satisfaction are definitively and causally linked to revenue, profit and positive customer behavior. Can you? 
 
And if you can, under what conditions are they linked, and when are they not?
Posted @ Sunday, December 12, 2010 12:31 PM by Robert Bacal
Perhaps the key to Belichick's comment is that the team or company with a successful disruptive strategy is not well described by the same stats that describe the rest of their league/industry. BECAUSE the strategy is disruptive. 
 
 
 
On the other hand if that doesn't describe your management then the standard statw will model your company well. 
 
Posted @ Monday, December 13, 2010 9:15 AM by Ian Straus
Good points, Robert. Thank you! In the context of customer satisfaction and loyalty, key measures do have predictive validity as to real world business outcomes, especially topline growth. (Profit, typically, is too variable to show any correlations.) Which measures are most appropriate for a business vary by industry and stage in the business lifecycle. For instance, see Customer Loyalty 2.0
 
Ian, that's an interesting distinction. In this example, though, I think the standard measures are too tactical to have a high correlation to winning. Turnovers is a more strategic measure, since it has a higher correlation to scoring, and therefore to winning. 
 
Posted @ Monday, December 13, 2010 1:09 PM by Jeffrey Henning
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