Determining the'North Star'for your SME:What is it andhow does ithelp achieveyour goals?

Call it a digital tool, a digital solution, or software. Essentially, all terms are correct, but at Label A, we refer to it as a digital tool. A digital tool is a means to solve a problem or achieve a goal, and its form can vary each time. Sometimes it's an app, other times a platform or a web application.

The most important aspect of developing a digital tool is to start from the question of how to best serve your end user. This question must remain central throughout the entire process because when you perfectly solve your end users' problems, they will return more often and recommend it to others. This way, you add value and contribute to achieving your NSM.

In which scenario is your end user's problem solved? When is it optimal? Is it a certain number of users, a specific usage duration, or a number of logged actions? It could be anything. What do customers hire you for, and what value do they hope to find or buy from you? This ties into the "job-to-be-done"—when have your customers achieved their desired result?

Make sure to consider your entire target audience; your NSM should ultimately apply to your entire (desired) customer base.

Label A is happy to help you find your North Star Metric, but if you want to start on your own, we have a tip: Look at the Value Proposition Canvas. This model helps you easily visualize your customers' pains and gains as well as the jobs-to-be-done. By placing these on post-its, you can gain insight into how certain elements relate to each other and whether any factors are missing.

The roadmap is the path to achieve your goal, your North Star. Review this roadmap with your colleagues so you can collectively commit to it. Once you have defined your North Star Metric, focus on identifying which initiatives contribute to it and which do not. Ensure this NSM is measurable to save time and avoid frustration during execution. Quickly phase out initiatives that don't contribute. Determine the steps and interim goals needed to reach your North Star. Identify any gaps to be filled and which existing initiatives can be accelerated to get closer to your North Star Metric. Commitment to this roadmap is crucial; the rest will follow naturally.

Crucial is to determine whether you have sufficient control over achieving your North Star Metric. Your organization operates in an economy where numerous factors can influence the service you provide. Heavy reliance on suppliers to achieve your NSM makes it risky. You may need to consider defining a different NSM or reducing this dependency. Additionally, it's important to realize that you're likely not the first or only one offering your product or service. Therefore, understanding what sets you apart from your competition is crucial. Focus on your strengths and resist being swayed by competitors' actions.

Understanding what your customers value most (value) or what they find lacking in other providers can work to your advantage. This is known as your unfair competitive advantage. What can you do better than your competitors that they cannot easily replicate? This is one of the key aspects to explore in step 3 when examining the "context" in which you operate. If you establish this value clearly, you become unbeatable.

On the journey to your North Star Metric (which is rarely a linear path), numerous sub-initiatives solving sub-problems will contribute to the ultimate solution. Some are digital, others are not; some are prerequisites for subsequent initiatives, while others stand well on their own. We observe an increasing level of digitalization in these initiatives. In the realm of digital tools, there are abundant opportunities, techniques, and technologies to achieve your goal. What offers the most potential for your objective or challenge? Is it an app, a web application, or another type of platform? Is it a prototype or an MVP? Start by researching the sub-challenges of your end users and explore various options to solve them. Need assistance? Look at the bottom of this page for the contact details.

A digital tool, as mentioned earlier, is a means to an end. It acts as a component or catalyst to rapidly achieve your objectives. However, a digital tool is never complete. There are always changes to consider, always something to adapt to. Therefore, your digital tool must be flexible enough to evolve with these changes, and you must know when those adaptations are necessary.

Build your digital tool with the North Star Metric in mind and how you'll measure it. Determine in advance the KPIs that will gauge whether you're on track to achieve your metric. Additionally, create a data-driven dashboard that includes these KPIs, allowing you to monitor progress and identify any emerging trends. Review these results periodically to assess whether adjustments are needed to enhance your solution further.

By making data-driven decisions, you can flexibly make choices that contribute to improving the tool and achieving the North Star Metric.