What’s Your Big Number?

Bar Chart

This one comes from way back in 2009, but Paul Graham’s advice on starting a new business is as solid as ever — and contains useful tips for long-time business owners well.

He begins by reminding us that “it’s better to make a few people really happy than to make a lot of people semi-happy.” and then shares 13 things every startup should know.  Among his gems are these:

Better to make a few users love you than a lot ambivalent.

Ideally you want to make large numbers of users love you, but you can’t expect to hit that right away. Initially you have to choose between satisfying all the needs of a subset of potential users, or satisfying a subset of the needs of all potential users. Take the first. It’s easier to expand userwise than satisfactionwise. And perhaps more importantly, it’s harder to lie to yourself. If you think you’re 85% of the way to a great product, how do you know it’s not 70%? Or 10%? Whereas it’s easy to know how many users you have.

Offer surprisingly good customer service.

Customers are used to being maltreated. Most of the companies they deal with are quasi-monopolies that get away with atrocious customer service. Your own ideas about what’s possible have been unconsciously lowered by such experiences. Try making your customer service not merely good, but surprisingly good. Go out of your way to make people happy. They’ll be overwhelmed; you’ll see. In the earliest stages of a startup, it pays to offer customer service on a level that wouldn’t scale, because it’s a way of learning about your users.

And this one that explains much of clients’ dissatisfaction with lawyers:

You make what you measure.

Merely measuring something has an uncanny tendency to improve it. If you want to make your user numbers go up, put a big piece of paper on your wall and every day plot the number of users. You’ll be delighted when it goes up and disappointed when it goes down. Pretty soon you’ll start noticing what makes the number go up, and you’ll start to do more of that. Corollary: be careful what you measure.

Though most firms don’t put a big piece of paper on the wall, that billable hour number is the one measure everyone pays attention to.  And what happens when all firms measure is time?  Lawyers make more of it.

What if the firm’s “big number on the wall” was something different?  How might that firm’s behavior change?

What if the “big number” was:

  • Number of cases referred/shared among the firm’s lawyers? 
  • The percentage of clients who stayed clients of the firm over the last 1, 5 and 10 years?
  • The number of “very satisfied” clients derived from a randomly-surveyed sample?

You get the idea.  Try measuring something different for a few months and see what happens.

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