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Measure What Matters to Customers: Using Key Predictive Indicators: Using Key Predictive Indicators (KPIs) Hardcover – 14 Sep 2006

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Product details

  • Hardcover: 210 pages
  • Publisher: John Wiley & Sons; 1 edition (14 Sept. 2006)
  • Language: English
  • ISBN-10: 0471752940
  • ISBN-13: 978-0471752943
  • Product Dimensions: 16.3 x 2 x 23 cm
  • Average Customer Review: 5.0 out of 5 stars  See all reviews (1 customer review)
  • Amazon Bestsellers Rank: 980,768 in Books (See Top 100 in Books)
  • See Complete Table of Contents

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Product Description

From the Inside Flap

Learn why the most important activities that actually matter in your business are those that impact your customers.

One hundred years ago, the traditional accounting measures of costs, activities, efforts, and inputs met the needs of that era′s businesses. But today, these internal metrics are narrow in their focus and have become less meaningful in the knowledge economy, with little effect, in the long run, on an organization′s bottom line. Compelling and bold, Measure What Matters to Customers lays out an exciting, new road map for measuring customer value and successfully raising profits.

With proven methods, Ron Baker renowned forward–thinker in the professional services firm field shows you how to capitalize on Key Predictive Indicators (KPIs), innovative measures that define the success of your enterprise as your customers do. These are specific, identifiable details that customers value in the products and services they receive details such as a preference to be contacted by phone instead of by e–mail, or a desire for rapid turnaround time on returned calls. Easy–to–read and relevant to your organization′s bottom line, this groundbreaking book shows you how to use KPIs to, for example, effectively track marketing data to determine which customers respond well to things such as cross–selling or to find out how receptive other customers are to entirely new offerings from the firm. It also shows you how to employ KPIs to enable your firm to react appropriately to your customer′s needs and increase the value they perceive, leading to higher profits. Topics covered include:

  • Why the traditional metrics are no longer relevant to measuring the effectiveness of knowledge workers
  • The new tectonic shift taking place in the economy the transition from manual and service workers to knowledge workers and why that difference is critical to the future of your business
  • How what you measure affects the value you provide to your customers
  • How to increase the effectiveness of knowledge workers
  • Developing KPIs for your company
  • Increasing knowledge worker effectiveness

Seismic in the strategies it presents, Measure What Matters to Customers reveals how to regain a competitive advantage in the marketplace and allow your company to develop the measures that matter to your customers. Applicable to manufacturing and service businesses of all sizes, this important book will challenge managers′ and executives′ theories about which measures are important in their businesses. If you want to increase your company′s profits by working smarter, this is the book for you.

From the Back Cover

Praise for Measure What Matters to Customers: Using Key Predictive Indicators

"From his wit to his insights, Ron Baker has done it again! As one of the best management thinkers of our time, he has taken on the field of measurement and given us the gift of knowledge so we may move ahead as well."
Reed Holden, founder, Holden Advisors Corp.,, coauthor, The Strategy and Tactics of Pricing

"Baker′s book evolves the rationale for defining the success of a business the same way the customer does. With impeccable logic, he leads the charge for effectiveness over efficiency by shining the spotlight on the realities of today′s knowledge economy. Measure What Matters to Customers is a Rosetta stone for leaders who are trying to translate what they measure into value for the customer."
Thomas Finneran, Executive Vice President, American Association of Advertising Agencies

"I have read literally hundreds of business books and no author has entertained, educated, challenged, and extended my thinking more than Ron Baker. Ron is a gifted storyteller who, in a disarmingly simple way, shares with his readers an extraordinarily powerful message. In Measure What Matters to Customers, Ron provides us with an elegant justification, together with a practical framework, for developing metrics that truly reflect what′s important to the people who, at the end of the day, determine the destiny of any organization its customers. If you play a role in contributing to the success of any entity, whether it is a for–profit or nonprofit, you and the organization you serve will benefit immensely from this book."
Ric Payne, President and CEO, Principa,

"We have known since the 1960s, when Xerox did extensive research, that employee satisfaction – customer satisfaction – profitability, yet the vast majority of companies measure only the latter. Why? Because we have a learning disability, that′s why! In Measure What Matters to Customers, Ron Baker slaps us in the face with a generous dose of logic to help us correct our blind wandering through the labyrinth of lagging indicators like revenue and profitability, in favor of key predictive indicators that define success the same way our customers do. Hmmm, maybe we will get it this time?"
Ed Kless, Director, Partner Development and Recruitment, Sage Software

"Ron Baker has done it again this is the most helpful business book that I have read. In it, Ron continues his relentless focus on customer value, challenging the reader to rethink their definition of success. It provides both a solid theoretical foundation and proven practical steps that can be implemented in your business today to become a truly customer–focused organization. Lead your organization to the next level by measuring what matters to customers."
Brendon Harrex, Chairman, Ward Wilson Ltd., Invercargill, New Zealand

"Yet more insights from Ron Baker that force us to challenge conventional norms norms that keep us missing the really important stuff. Read this book and discover that there absolutely is an opportunity to move way beyond where you are now, into new realms of real relevance indeed into new ways of delivering a far better customer experience. Yet again, Ron Baker provides a fabulous pathway."
Paul Dunn, founder and CEO, ResultsNet Australia,, coauthor, The Firm of the Future: A Guide for Accountants, Lawyers, and Other Professional Services

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Most Helpful Customer Reviews

0 of 5 people found the following review helpful By Paul Anthony Miller on 23 Nov. 2006
Format: Hardcover
Yet again Ron has written another book which is of relevance to all Business Owners. He discusses at length what we need to mesaure to generate profits and how we need to concentrate on what our Customers measure who are the judge of how successful we are in Business.

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Most Helpful Customer Reviews on (beta) 7 reviews
5 of 5 people found the following review helpful
Useful, insightful, and right on target - a great business read! 18 Jan. 2007
By J. Thomas Hood III - Published on
Format: Hardcover
Ron Baker's latest book is a winner. The "Value Pricing" guru is back - this time with a great book on measuring what matters. Ron makes the case that we are measuring from the wrong perspective as we look backward (lagging indicators) and from the inside (busines operations point of view) when we should be looking forward (leading indicators) and outside-in (from the customer's perspective).

Ron challenges the status quo and backs it up with great stories of great companies and a good historical background of peformance measures. I love his theory for the new formula of business : Profitability = IC (Intellectual Capital) x Effectiveness x Price. He then goes on to explain the three components of Intellectual Capital as Human Capital, Structual Capital & Social Capital. This new framework explains the new value creation companies and how to transform your business into a value creating machine. I recommend this book highly!
2 of 2 people found the following review helpful
Just the first few chapters alone are worth the time and money 4 Oct. 2009
By Rags Srinivasan - Published on
Format: Hardcover
This is a very well written book with analytical take on things. Baker insists on the need for theory, that can be tested and improved on, over fads that do not stand on data. It is refreshing to see a author who evangelizes the importance of profitability over market share and the need for businesses to leave the the cost-plus mentality in pricing. I recommend this book for all marketers and decision makers.
1 of 1 people found the following review helpful
Makes Your Head Spin - Why don't all organizations do it this way? 26 Aug. 2011
By Stephanie - Published on
Format: Hardcover
I think the beauty of this book is how author Ronald J. Baker brings life to data through effective storytelling and understanding that emotions and people matter ... not what one might expect from an accountant.

Too often organizations get trapped into the status quo, continuing with the way things have always been done. This includes the data we use to gauge our success.

Baker's engaging style and relevant examples prove why we need to re-think this.

It's easier and easier to get data - making organizations dependent on all the numbers. It's rare that companies step back to look at that data and assess whether they're measuring the right things. Baker questions if organizations do enough to adapt to their customers' changing needs.

He proves why organizations need to have the courage to look at both their quantitative data and the qualitative information that bring the numbers to life. We can't lose sight of how important it is to include creativity and critical thinking when analyzing numbers. It's not enough to just look at the data we're already getting, we need to have the courage to question it, to let our intuition guide us ... and then back that up with data to prove or disprove our theories.

Analytics are a means, a tool to inform our decision-making. However, organizations need the creativity of the human element or else they will stagnate.

I appreciated Baker's combination of both 1) the theory and data behind his assertions AND 2) his ideas for specific actions companies can adopt. I disagree with the reviewer who felt Baker just recycled other stories and examples. Baker has some strong opinions on what we need to do differently to be profitable. I felt that he chose great stories and research to back up his original ideas.

My only criticism would be that there are so MANY valuable ideas it's somewhat hard to determine where to focus. Related to re-thinking what we do with our data and information, he also makes a strong case for the importance of knowledge management and engaging employees. I started reading this thinking it would be only about data but it's really a book on building a stronger organization overall. Since we can't boil the ocean (cliché, sorry) it would be helpful to understand the logical order in which to tackle all of these important concepts.

The best books change one's thinking. This one changed mine.
1 of 1 people found the following review helpful
Thought Leadership for Growing Businesses 8 Oct. 2007
By Steve Orleow - Published on
Format: Hardcover
This book is compelling reading for two groups of people. Those that have been schooled in traditional accounting and business and the second group for those that believe that innovation and change is important for business success. This book shifts the focus from your view of the business to your customers view, and then challenges you to follow the indicators that measure value in their eyes.

Ron provides credible argument that most of what we measure today has little impact on our future success. He then delves into the areas that are more appropriate indicators of future success.

The book is exceptionally well researched and draws on thought leaders from most era's. It gives weight to trusting you instincts in business and provides a case for looking at those items that are harder to measure, but more valuable to follow.

This is a must read and I highly recommend it.
2 of 3 people found the following review helpful
Couldn't put it down! 19 Feb. 2008
By Mark A. Chinn - Published on
Format: Hardcover

I have just completed reading Measuring What Matters to Customers. I couldn't put it down and finished it off in three days. As I was finishing it I had the mixed emotion of being pleased to finish your message, but sad the story was coming to an end.

You know I have kidded you about how academic Professional's Guide to Value Pricing was. Well, Measuring ranks right up there as an academic masterpiece, which is important in this day and age when it seems that everybody is just writing what they think. You should have been a college professor and your book would be worthy of text at Harvard Business School.

I have been using business coaches for my family law practice for 20 years and I have read at least a hundred success and management books and I have lectured all over the U.S. and Canada and there are many previously unearthed gems in your book.

First, traditional numbers usually don't help. I have been telling my advisors and support staff for years, "These numbers don't seem to help. I can be enjoying an unbelievable trend and then...boom, no business" Or, "No, there are no seasonal trends, sure some people put off divorce during the holidays but sometimes the holidays prompt other problems." Being told by you in no uncertain terms that there is no certainty is a blessing. Thank you. Other points of import:

Each customer is different. (That's what the last one insisted in his recent exit interview...that he was different). So, focus your efforts on each one, not solely on a system for pleasing all.

We need to pick three leading indicators, and the team needs to do it.

Team workers are "knowledge workers" and "volunteers" and it is important to call them that and treat them like that.

With good team members management needs to get out of the way and not demoralize them with negative feedback or scoring; and we further need to eliminate systems and procedures which interfere with what they are doing. We need to release our grip on our systems and ask the team members what systems help and what gets in their way.

Measuring the wrong thing accurately can throw you completely off. Take time to carefully analyze situations outside of the facts. Your example about the World War II Bombers was unbelievable. The first thought was that the returning planes needed more armor where the bullet holes were. But Abraham Wald came to the opposite conclusion: that the armor needed to be placed where the bullet holes were not because the planes that made it back had survived even though being hit where they were.

Being efficient at something irrelevant is a sign of impending disaster.

The real things of value in life cannot be measured, something my more introspective teammates have been trying to tell me for years.

It takes courage to go against the grain and that is what you have done. Keep up the good work.
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