Success is All You Need

Dazza Greenwood•June 12, 2023

what other things are like KPIs and OKRs?

Key Performance Indicators (KPIs) and Objectives and Key Results (OKRs) are two methodologies used by businesses and organizations to set, track, and measure the success of their strategic goals. They are both types of performance metrics.

Several other methods and frameworks are similar in nature, designed to help businesses track progress and achieve their goals:

Balanced Scorecard (BSC): The Balanced Scorecard is a performance metric used in strategic management to identify, improve, and control a business's various functions and resulting outcomes. It includes financial measures that tell the results of actions already taken and complements those with measures on lead indicators: customer satisfaction, internal processes, and learning and growth.
SMART Goals: SMART stands for Specific, Measurable, Achievable, Relevant, and Time-bound. This system is used for setting objectives in project management, employee performance management, and personal development.
Management by Objectives (MBO): This is a management model aimed at improving the performance of an organization by clearly defining objectives that are agreed to by both management and employees.
Key Result Area (KRA): KRAs refer to the general areas of outcomes or outputs for which a department's or individual's role is responsible. A typical role targets three to five KRAs.
Critical Success Factors (CSFs): These are elements that are vital for a strategy to be successful. CSFs provide the key goals or objectives for your business and keep teams focused on the same crucial areas of business.
Performance Prism: This is a performance measurement framework that focuses on stakeholders. It examines the relationship between the organization's stakeholders' wants and needs, strategies, processes, capabilities, and stakeholder contributions.
Hoshin Kanri: Also known as Policy Deployment, it is a strategic planning method used to ensure that the strategic goals of a company drive progress and action at every level within the company.

Remember that each of these methods has a different focus and application, but all are aimed at helping an organization define its objectives, measure progress towards them, and adjust its strategy based on the feedback it receives.

That's really good, thank you! Can you add two more items in the same format as this list for 1) KPIs and 2) OKRs?

Sure, here's how KPIs and OKRs would be described in a similar format:

Key Performance Indicators (KPIs): These are quantifiable measurements that reflect the critical success factors of an organization. They are a way of measuring performance against strategic and operational goals. KPIs help organizations understand if they're heading in the right direction—and if not, where they need to divert their attention to improve. It's common for KPIs to be tied to specific strategic objectives, such as increasing customer satisfaction or improving operational efficiency.
Objectives and Key Results (OKRs): This is a goal-setting framework that helps organizations set ambitious goals with measurable results. OKRs are typically implemented on a quarterly basis and consist of an Objective, which defines a goal to be achieved, and up to 5 Key Results, which are specific measures used to track the achievement of that goal. The aim of OKRs is to ensure that everyone in the organization is moving in the same direction with transparency and clarity on expected outcomes. They are meant to set strategy and goals over a specified amount of time for an organization, teams and individuals.

what is the relationship between these methods and the so-called "business hypothesis" measurement and testing approach that arose from the Lean Startup and agile business movements?

The concept of a "business hypothesis" comes from the Lean Startup and agile business movements. This idea is all about making assumptions or hypotheses about your business - for example, who your customers are, what they want, how your product or service will meet that need, and how you will make a profit. Once these hypotheses are established, you use a process of building, measuring, and learning to test your assumptions, validate them with real-world data, and iterate on your business model or product based on what you learn.

Here's how each of the methods I mentioned earlier might tie into this concept:

KPIs (Key Performance Indicators): Your KPIs might be used to measure the success (or lack thereof) of your business hypotheses. For instance, if one of your hypotheses is that customers will spend more time on your website after a redesign, a KPI for this might be the average time spent on your website per user.
OKRs (Objectives and Key Results): The Objective part of OKRs could be used to express what you hope to achieve with your business hypotheses. The Key Results, then, would be specific metrics (like KPIs) that you expect to see if your hypotheses are correct.
Balanced Scorecard (BSC): This management tool can be used to measure strategic performance and set up strategic management hypotheses. The four perspectives (financial, customer, internal processes, learning and growth) help test the business hypothesis from different angles.
SMART Goals: These goals can be set up based on the business hypotheses you have made. They can give you a clear path to follow for testing and validating your hypotheses.
Management by Objectives (MBO): In MBO, you could use your business hypotheses to define your objectives, which are then agreed upon by management and employees.
Key Result Areas (KRAs): KRAs could be used to determine what areas of the business will be affected by the business hypotheses, helping to focus resources and efforts.
Critical Success Factors (CSFs): CSFs could be derived from your business hypotheses. If your hypotheses are correct, these would be the areas of the business that are crucially important for success.
Performance Prism: The business hypotheses could be tested from the perspectives of stakeholders (investors, employees, customers, regulators, communities, suppliers, etc.).
Hoshin Kanri: This strategic planning method could incorporate your business hypotheses into the overall strategy and vision of the organization. Your hypotheses would be "deployed" down through the levels of the organization and tested at each level.

In summary, each of these management and measurement methods could be used to test and validate (or invalidate) your business hypotheses. By integrating hypothesis testing into these methods, businesses can become more agile, adaptable, and effective in their strategies and operations.

Thank you! For purposes of the business hypothesis method, how would one articulate the measures of success? For example, is the phrase "we will know we have succeeded when X" be the best way, or are there other ways to measure success for a business hypothesis test?

Yes, your example "We will know we have succeeded when X" is one common and straightforward way to define success for a business hypothesis. It sets a clear target to aim for, and it's easy to understand when you've reached it. However, there are multiple ways to articulate and measure the success of a business hypothesis.

Establishing Success Criteria: Before you start testing your hypothesis, establish clear criteria that indicate success. It could be reaching a certain sales target, acquiring a certain number of new customers, reducing production costs by a certain percentage, or other relevant indicators based on the hypothesis you're testing.
Defining Metrics: Metrics are key in measuring the success of your hypothesis. These could be financial (like revenue or profit margins), customer-related (like Net Promoter Score or customer acquisition cost), operational (like production efficiency or error rates), or any other type of metric that is relevant to your hypothesis.
Setting Benchmarks: Benchmarks allow you to compare your performance with industry standards or competitors. If your hypothesis is about outperforming the competition, then your measure of success could be surpassing a specific benchmark.
Setting Milestones: Particularly for more significant or longer-term hypotheses, setting and achieving milestones can be a useful measure of progress towards success.
Using Objectives and Key Results (OKRs): The OKR method is an excellent way to articulate success. For example, your Objective might be to validate your hypothesis, and then you would define Key Results that clearly measure that success.
Leveraging Key Performance Indicators (KPIs): Similar to OKRs, you can use KPIs to measure success. KPIs provide quantifiable measurements that gauge performance over time.
Tracking Progress Over Time: Sometimes, success can be measured by consistent improvement over time. This is especially true for hypotheses related to growth or improvement.
Customer Feedback: For hypotheses about customer behavior or preferences, direct customer feedback can be an excellent measure of success.

It's essential to remember that success measures should be as specific, realistic, and measurable as possible. The method you choose will depend on the nature of the hypothesis and the available resources and data. Also, remember that not every hypothesis will be validated. Part of the process is learning from failures and negative results and using that information to iterate and improve.

Thanks, that is really great! Now, I'm interested to apply some of these ideas to the art and skill of composing the best prompts with ChatGPT to help the user achieve their goals. Please evaluate the following examples and assess 1) how well or poorly they apply the concept of success metrics to the design of prompting LLMs and 2) how this approach could be changed or replaced in order to achieve even better results by applying the concept of success criteria to prompting in a better or different way. The example follow: ___________________________ EXAMPLES OF USING SUCCESS CRITERIA FOR BETTER PROMPTS AND OUTPUTS First Example - Mobile App Prompt 1: Generate three different plans a big four consultant can deliver for a mobile app developer to use A/B testing to improve ROI on their least profitable simcity style game with a free tier, a monthly subscription tier, and in-game purchase options. A successful plan meets each of the following three success criteria: 1) it defines a clear and discrete potential improvement for user action; 2) if the improved use action was deployed to the entire customer base costs would reduce or revenue would increase; and 3) the user action would not decrease user satisfaction with the app. Prompt 2: Rate each plan against each of the three success criteria. Display in a single markdown table with rows for each plan and columns for each success criteria. Rate from 1 (lowest) to 5 (highest). Include a row below each plan to describe the rationale for each rating. In a row below the rationale, describe how success would be measured. Second Example - DMV Innovation Strategy Prompt 1: Generate three different plans a big four consultant can deliver for an innovation strategy to a state department of motor vehicles. A successful plan meets each of the following three success criteria: 1) significantly and measurably improves service delivery for individual citizen license renewals and businesses such as taxi, trucking, and delivery fleets; 2) leverages COTs technology and widely used open source; and 3) will eventually reduce ongoing costs for the department of motor vehicles. Prompt 2: Rate each plan against each of the three success criteria. Display in a single markdown table with rows for each plan and columns for each success criteria. Rate from 1 (lowest) to 5 (highest). Include a row below each plan to describe the rationale for each rating. In a row below the rationale, describe how success would be measured. Third Example - Continue the Prompts to Achieve More Successful Outputs After using the above techniques, attempt to further improve the outputs in the following way Prompt: Based on this analysis, please devise a single plan that takes the best elements of each of the 3 proposed plans to create a plan that rates overall higher for each criteria. Again, display this in a single markdown table with the plan on a row and each success criteria in columns, and please include a row below the plan to describe how this new plan would perform better than any of the previous plans and a row below that to describe how success would be measured.

These prompts are excellent examples of how to utilize success criteria to generate actionable plans and rate them according to defined metrics. Here's an assessment of each:

First Example - Mobile App:

The prompts in this example clearly state the context, objective, and criteria for success, which can help guide the AI to generate specific and relevant plans. The request to use a markdown table provides a structured format for evaluating each plan against the success criteria.

Second Example - DMV Innovation Strategy:

Again, these prompts effectively establish the context and outline specific success criteria. These prompts focus on achieving significant improvements in service delivery, cost-effectiveness, and leveraging existing technology - which are all key considerations in a public sector context like a DMV. The prompts are well designed to get the AI to produce useful and targeted output.

Third Example - Continue the Prompts to Achieve More Successful Outputs:

This is a great way to use the AI's output to refine and improve upon the initial ideas. By asking the AI to consider the strengths of each plan and create a new one that performs better, you're leveraging the AI's ability to analyze, synthesize, and generate creative solutions.

Suggestions to Enhance the Application of Success Criteria:

Be Specific: While the prompts are very well designed, providing more specific details or examples may help to guide the AI. For instance, what types of user actions are you interested in improving for the mobile app? What specific services should the DMV plan focus on?
Prioritize Success Criteria: If certain success criteria are more important than others, indicate this in the prompt. This could help the AI prioritize certain elements in its output.
Iterate: These prompts are designed as a one-time interaction, but iteration can be useful. After you receive the initial outputs, you could continue the conversation with additional prompts that ask the AI to refine its answers based on further input or feedback.
Ask for Risks or Challenges: You could add prompts that ask the AI to identify potential challenges or risks associated with each plan, as well as suggestions for mitigating these risks. This adds another level of analysis and practicality to the plans.
Request Executive Summaries: Especially for complex plans, it might be useful to ask the AI to provide an executive summary for each plan. This would allow you to quickly understand the key points of each plan.

These prompts demonstrate an excellent application of success criteria to generate and evaluate potential plans. They provide a clear objective and define success in a measurable way, which allows for targeted and relevant outputs. They are also structured in a way that encourages the AI to think creatively and strategically, which can lead to high-quality results.

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