Valuing External Input: Start with Data

Co-authored by Will Melton & Tom Lawlor

According to BCSG as cited in this The UPS Store article, 70 percent of small business owners that receive mentoring survive for five years or more, double the rate of those who do not receive mentoring. While this survey statistic refers to the success rate of new businesses, the pace of change driven by technological advancement and Moore’s Law will have the same impact on established businesses that don’t embrace the change that’s happening around them.

Why taking advice from an expert can be extremely difficult for some

We acknowledge the reluctance of leaders to take advice. The barriers to getting or accepting the advice are understandable – financial resources (although not always required), making time, and fear, to name a few. Then, of course, there is the issue of how many different advisors are out there and not knowing which is the best. Maybe the problem isn’t always ego- or fear-driven, but perhaps decision paralysis is taking hold in some cases.

Another isolating factor for business owners can be a poor experience with someone they’ve relied on in the past. A business owner may have been burned by prior advice that added little value or even had a negative bottom-line impact. That can leave a strong imprint on a business owner’s decisions that will last for years. In short, finding the right person from whom to get advice isn’t always easy.

How leaders can bring themselves to trust advisors in order to improve decision making

Start with data.

According to a 2015 report from Hubspot, “the less companies know about their KPIs, the less likely they are to meet their revenue goals. 74% of companies that weren't exceeding revenue goals did not know their visitor, lead, MQL (marketing qualified lead), or sales opportunities.” So it’s clear that knowing the state of things, a.k.a. relying on data, can provide a big boost.

Two types of data should be considered. First, a leader should seek verifiable third-party data about their industry and the industry that is serving clients with their specific problem. This could come in the form of industry reports, survey results or case studies furnished by the advisor. This information can provide a baseline for how the world works today.

But more importantly, companies should be seeking detailed and accurate internal data as well. Understanding the key performance indicators within their business and the associated data can help leaders understand if they are meeting, exceeding or missing their targets. Armed with both, a business owner should be able to evaluate potential advisors and rely on them to help navigate the decision-making process.

Will Melton is the founder and president of Xponent21 and the co-founder and lead product engineer for Client Magnet. Through his companies, Will engineers digital experiences that delight, drive revenue and increase operational efficiency. He also works with attorneys and law firms to grow their market share and attract the right types of clients faster and at a lower cost.

Tom Lawlor is the founder and senior consultant of Custom Consult. Having led past change initiatives for the likes of dozens of Fortune 500 companies, he now implements strategic initiatives with middle market companies to drive enterprise value growth up to 70-100%. He works with business owners and executives to refine and actually manage day-to-day, frontline activities that add value and improve both employee and customer experience.