## Metadata - Author: [[Ergest Xheblati]] - Full Title:: How Analytics Can Make a Massive Impact on the Bottom Line - Category:: #🗞️Articles - Document Tags:: [[Data Analysis]], - URL:: https://sqlpatterns.com/p/how-analytics-can-make-a-massive - Read date:: [[2023-12-31]] ## Highlights Disclaimer: he works together with [[Abhi Sivasailam]], so it's not like we have two people with the same idea ([[Metric trees]]) > [[Theory of Constraints]] (TOC ([View Highlight](https://read.readwise.io/read/01hjz8ebgh0m35jghhwhdjq2ph)) > Benchmarks/targets are one of two ways of discovering anomalies in key metrics. As Alex mentions in the video, he discovered those targets for that specific type of business via experimentation. Sometimes you can use industry standards here (e.g. email open rate) ([View Highlight](https://read.readwise.io/read/01hjz8jxqa13chgdxdfp0rh6tj)) > The second way to discover variation is by comparing the metric to itself over time. This is known in manufacturing as a control chart or XmR chart. ([View Highlight](https://read.readwise.io/read/01hjz8kn7me2d05ef0s1w41j0p)) > but why did he pick those two constraints specifically? > They were both massively off target and they were both upstream ([View Highlight](https://read.readwise.io/read/01hjz8m6ayqagme7nz0g4j9jhr)) > Finding them should be your top priority as a data leader or data professional and the best way to do it is by building the operating model of the business ([View Highlight](https://read.readwise.io/read/01hjz8mmka4x035jxgsnd2h583)) > Org structure represents the biggest constraint, especially in a sales function. If your sales people aren’t managed well, no amount of effort in fixing lead quality or conversion rates will matter. ([View Highlight](https://read.readwise.io/read/01hjz8n0g4885y7t1zywwr8d6h)) > the diagram below is a very powerful visual representation of a business function or of the entire business. It’s called a Metrics Tree. ([View Highlight](https://read.readwise.io/read/01hjz8nrydwnzfm4avcbspnz8p)) >  ([View Highlight](https://read.readwise.io/read/01hjz8nt900ezqsqxt17rxk4jr)) ^d3888b > The yellow boxes represent conversion rate type metrics. The blue boxes represent absolute numbers. The product of the two feeds into the next level ultimately ending up in the revenue box. ([View Highlight](https://read.readwise.io/read/01hjz8pccv0r6bggd9fmx77fzr)) > The red boxes represent “levers” or “input metrics” which are things you can manipulate to directly impact the conversion rates. ([View Highlight](https://read.readwise.io/read/01hjz8pjkvc7v0kvw4kvhfsjym)) > you need to build a metrics tree for the business. ([View Highlight](https://read.readwise.io/read/01hjz8q58pvh68rx7c5vnx3618))