Aligning Tech to the Business
One of the hard parts!
Now the hard part! Taking business goals and turning them into specific technical objectives and KPIs.
Translating business objectives into actionable technical goals can be difficult. Business goals can be squishy, asking for ‘higher unaided name recognition’ or ‘reduced churn among customers who purchased within the last 12 months’.
In the best case, this process is a dialogue between business and technical leadership. Unfortunately, that’s not always how it works. For now, this assumes a dialogue and the last chapter of this section will cover situations where business and technology groups don’t always get along.
The core principle for this is to identify how technology directly influences the desired business outcome. If there isn’t a clear line or narrative connecting a technical KPI to a business strategy, the KPI needs to be revisited or refined.
Example Alignment Exercises
Example 1: Increasing Customer Retention
The business wants to encourage customers to stick around longer. Often, a loyal customer is far more profitable than a new customer. “Retention” is the term used to describe customers who stick around, rather than cancelling subscriptions.
- Business Objective: Increase customer retention by 15% in the next fiscal year.
- Technical Focus: Identify technical factors that influence customer retention. This could include:
- Website/App Performance: Slow loading times, frequent crashes, and poor user experience can lead to customer churn.
- Personalization: Lack of personalized content or recommendations can make the customer experience feel irrelevant.
- Customer Support: Difficult-to-navigate help resources or slow response times can frustrate customers.
- Technical KPIs: Based on the technical focus areas, the tech team might set the following KPIs:
- Reduce average page load time by 20%.
- Increase the percentage of personalized recommendations by 10%.
- Reduce customer support ticket resolution time by 15%.
- The Story: "By improving website performance and personalization, we aim to create a more engaging and satisfying customer experience, leading to increased retention. Additionally, by streamlining customer support, we can resolve issues more efficiently, further enhancing customer satisfaction and loyalty."
Example 2: Expanding into New Markets
As a market matures, a growing company often finds opportunities in new geographic regions. This is an exciting prospect, but involves complexities that don’t exist when serving a single geography, single language, or single regulatory area.
- Business Objective: Expand into the Latin American market within the next two years.
- Technical Focus: Identify technical requirements for successful market entry:
- Localization: Website and app translation, currency conversion, and adherence to local regulations.
- Infrastructure: Ensuring adequate server capacity and low latency for users in the new region.
- Payment Gateways: Integrating with popular payment methods used in Latin America
- Technical KPIs:
- Complete localization of the platform for the target market by [date].
- Achieve a server response time of under [x milliseconds] for users in Latin America.
- Successfully integrate with at least three major Latin American payment gateways.
- The Story: "By localizing our platform, optimizing infrastructure for the region, and offering familiar payment options, we will provide a seamless and user-friendly experience for customers in Latin America, enabling successful market penetration."
Example 3: Improving Product Development Efficiency
Another way to improve company profit is to improve existing products or develop new ones as customer needs or technical capabilities evolve. “First to market” is not a promise of success but there are advantages to being able to respond quickly with new and improved products.
- Business Objective: Reduce product development cycle time by 20%.
- Technical Focus: Identify technical bottlenecks in the development process.
- Code Review Process: Lengthy code reviews can delay releases.
- Testing and QA: Inefficient testing processes can cause delays and increase bug rates.
- Deployment Automation: Manual deployments can be slow and error-prone.
- Technical KPIs:
- Reduce average code review time by 10%.
- Increase automated test coverage to 90%.
- Achieve continuous deployment with at least [x] releases per week.
The Story: "By streamlining our code review process, increasing automated testing, and implementing continuous deployment, we can accelerate our development cycle, enabling us to bring new features and products to market faster."
The Bottom Line: Align or Die
A technical team that isn’t aligned to the business will flounder and produce poor results.
To avoid this, business and technical leaders should work together to discuss larger business objectives. From this discussion, leaders then create a set of technical goals and metrics that connect technical work to the business strategy.
Technical progress can be measured through a set of SMART goals and supporting KPIs. These KPIs can be tracked at regular intervals and reporting should be frequent enough that problems can be caught early so leadership can react in a timely fashion.
Setting up aligned goals and KPIs is both an art and science. The more communications and partnership between teams, the better the results as the goals and KPIs will be focused to support the common company strategy and be rooted in data that everybody agrees is meaningful.