Using Past Performance to Improve Future Performance

While pursuing our goals, sometimes we get stuck in doing the same actions but trying harder. That might look like putting in more time or doing a higher volume of the same tasks. This can work if we have a proven process. If we don’t have a proven process then this approach doesn’t always work at producing the desired results and reaching our goals. Working harder isn’t always the path to success. There are sayings that people throw around such as “work smarter, not harder” and the definition of insanity is “doing the same thing over and over and expecting different results.” They sound nice but what can we actually do about it?

There are several common mistakes that people make:

If these attempts don’t work, we can feel frustrated and discouraged, which can give way to resignation, cynicism, and even giving up on finding an effective solution. What we need is some guidance to point us in the direction that the solution might be. This will narrow down our scope of potential solutions that we try and reduce the time and energy that we waste. One useful tool for pointing us in the right direction is to analyze our past performance for what worked and didn’t work. Past performance doesn’t predict or guarantee future results, however we can use it to help us troubleshoot and identify important insights. It’s also useful for determining the effectiveness of a process or potential solution. Overall, this is a combination of troubleshooting, process of elimination, and making educated guesses.

Analyzing past performance requires tracking statistics because we can only analyze what we can measure. Our feelings are not a good reflection of effectiveness. I’ve worked with clients who felt that their business was performing poorly or that it wasn’t profitable. They were stressed out about their business and when we compiled and analyzed the numbers, we found that the business was doing significantly better than they felt and even profitable. The issue was that they were spending all of the profit so they felt like it was unprofitable. While looking at reality by measuring it can be confronting and scary for some of us, it’s very useful because being grounded in reality allows us to create effective solutions to produce real results. The first activity for analyzing the past performance is to gather statistics. If you don’t have statistics, then you will need to start tracking statistics so that you have data to analyze. Tracking statistics can be as simple as writing down numbers on a piece of paper.

What statistics should be measured? This depends on which the steps in the process can affect the overall effectiveness. For example, if I’m knocking on doors to sell chocolate to raise money for a charity I could track the number of doors that I knock on, the number of people who answer the door, and the number of people who buy. My goal is 150 customers. When I track these numbers, I can start to compare which steps were effective and which were not. Let’s pretend that my statistics are:

Looking at the conversion from one step to the next I can determine which steps are more and less effective. In this scenario, 50 persons answered the door, 10 closed the door after I introduced myself, therefore my introduction converts 80% to keep speaking to me until I make a sales offer. I made 40 sales offers and converted 75% of them into customers. Those conversion numbers are pretty good. There is a large difference between the number of doors that I knocked on and the number of people who answered. That step converts at 50%. If I want to improve the conversion at this step so that 60% or 70% of people answer their door, maybe I need to go knocking on doors at a different time or day where there is a higher chance of people being home. This is how statistics can be used to make choices on improving effectiveness.

I worked with a client who wanted to increase sales and wasn’t sure how to reach more potential customers. The client had tried a few different marketing methods. I had the client go through statistics how where all of the past customers came from and the amount of revenue that was produced. By analyzing the past, we discovered that referrals paid $500 but there wasn’t a steady flow of them. Advertising on Instagram generated 1 customer for every $100 spent on ads. There is less profit with advertising but for every $100 spent, there was $400 left, and there was still profit after all expenses. The conclusion was to do Instagram ads regularly and consistently to generate a consistent stream of customers. The statistics showed with certainty what worked.

Here are the steps for analyzing the past performance:

1. What is the goal?

2. What results does my current process produce?

3. Is the gap between my goal and my results acceptable or not?

4. If the results are unacceptable, which steps in my process convert at a percentage that is acceptable? I should keep those steps intact.

5. Which steps in my process convert at a percentage that is unacceptable? I need to improve those steps or replace those steps with different actions.

When analyzing our past performance, sometimes we discover that we already have an effective solution but we weren’t aware how good it was and we weren’t using it enough like my client with the Instagram ads. Sometimes we discover that we need to improve only part of our process like the example of selling chocolates. Sometimes we discover that we need a whole new process. The important part is that we take a systematic approach by having measurable goals, track statistics that we can analyze for effectiveness, so that we can make informed choices about what changes to make in order to produce our desired results and to reach our goals.