The Power of the Northstar Metric

During my time leading the Digital transformation efforts for Comcast Cable, I learned the power of having a Northstar Metric.

First off, what is a Northstar metric? This is a measure of an overarching effort in an organization representing the progression and performance of that effort. In our case, this was a measure of the Digital First program and our progress in shifting Consumers over to digital channels from offline channels.

There are multiple points of value in having this type of metric. The first is that it will give the overall organization a signal for progress of an initiative or lack thereof. Leaders across an organization want to be associated with successful efforts, and progress against the metric will help to signal that success. In turn, positive momentum in the metric will make it easier to bring the organization along with the change. Also, since there is just one overarching metric, it is easier to communicate broadly across an organization – including your frontline employees.

Another key factor is the metric can be leveraged for bonusing and compensation. People will do what you pay them to do, so if there’s any way to find a representative way to measure your initiative and then pay people against it, the reinforcement is powerful. We actually had the metric piped through screens on the Digital floor and also behind the desk of our CEO. It was omnipresent and when we hit the bonus kicker after our first year, it underscored for people that it paid to get behind the initiative - no pun intended.

Last, the measure can be a diagnostic as with any other metric you measure for organizational performance. Creating a forecast and plan gives a sense of where one should be and if you fall behind or ahead, you can dig into understand the levers to help you to manage things more closely. It’s important to create those plans to the lowest common denominator of your organization. In our case we had forecasts for each of our geographic divisions that owned their P&L’s. Some of these divisions were further along the change curve, so this enabled us to provide objectives that were attainable but had enough stretch to them for each.

There are also limits to creating such focus around the Northstar metric. There may be other critical and important measures and factors of success that can get lost in the focus on the Northstar. We had created a wide variety of forums to drive our initiative for different levels of the organization. We always covered the Northstar metric in these reviews, but also added in other important change metrics that reflected overall progress. It’s important to provide the full picture to the organization.

Additionally, it is critical to have a third-party analytical part of your organization create and measure the metric. We leveraged our Enterprise Business Intelligence unit as a respected third-party group to create and report on the metric. This is no different than having your Finance and Accounting organization report on its P&L performance. It will buy you credibility for the metric that could be lost through self-production.

So, I’d recommend for any major change initiative that you undertake, find a way to create and measure a Northstar metric that will capture the essence of the effort. This will provide you a lever in your change management that will prove quite fruitful.