Do You Have Business Problems or Technical Problems?
Many managers I talk with struggle to define their problems because they confuse business problems with technical problems, and in doing so, they are unable to find means of solving them. I hope this short article will help you understand the difference between business problems and technical problems, and in turn help you achieve your goals more effectively.
Let’s start with my definition. A business problem is one that can be articulated in terms of a measurable goal within a timeframe and a budget.
Let’s look at some common business problems in our industry:
- “Our fundraising is lagging: Our goal is to increase our individual donor base by 10% within the next 12 months.”
- “Our subscription renewal rate is declining: Last season we renewed 54%, and to meet our budget this year we must increase it to 60%.”
- “We don’t know who our patrons are: With only 20% of our tickets sold online, we are not capturing customer data and can’t communicate after the performance.”
- “Our customer service isn’t great: We can’t treat patrons personally when they are at the box office window because we don’t have all their history at our fingertips.“
Each of these business problems comes with a clear definition of the issue (missing budget, missing funding or marketing opportunities, or offering poor service), and each comes with an opportunity to improve and achieve a better business result.
- If you increase your donor base by 10%, you’ll have more contributed income.
- If your subscriber renewal rate goes up, you’ll have more income sooner.
- If you sell more tickets online, you can market more effectively and in a more timely way.
- If you can provide better patron data to your box office staff, they can more easily provide better service to those who walk up or call in.
However, managers often stop short of articulating their business problems, and they conflate them with technical ones. I often hear, “Our problem is that we have our data in separate systems,” or “Our online ticketing user interface is confusing,” or “Our donor list is not organized well.” These are indeed problems — but they are technical issues. Undoubtedly they result in poor business results, but these are symptoms of the problems; they are not the problems themselves.
The most important thing you can do when talking with your board, or a consultant, or even a company such as ours, is to specifically identify your crucial business problems in terms of numbers, dates, and resources.
Let’s take one small example here. If you are selling only 20% of your tickets online and you want to increase it to 60%, the first thing I’d do is validate that number. Talk with other organizations in your area to make sure your goals are achievable. We know from our research that more than 60% of arts patrons nationwide prefer to buy their tickets online, and some of our clients sell up to 80% of their tickets online. Once you’ve validated that number, you can get to why you’re not selling a higher percentage of your own tickets online. Is your website poorly laid out? Is it impossible to buy a ticket without creating an online registration and therefore a large number of people “abandon” your site? Are your ticketing pages unsecure and therefore patrons are worried about putting their credit card data on your site? These are technical problems, all of which can be solved. If you’re working with us, or a web designer, or a consultant, not only can you address these issues head-on, but once you start making technical improvements, you should also be able to measure your results against your stated goal. Again, we’re solving technical problems to achieve a business goal.
The more you can articulate your business goals, the better equipped you will be to identify solutions, and the more you’ll be able to get others to help you achieve them. Though many things in our industry are not measurable in numbers, business results are — so if you keep that in mind you’ll significantly further the goals of your organization, and you’ll definitely have better board meetings!