Product Thinking
Product Thinking: Metrics
19 May 2026
Knowing what to measure is as important as knowing what to build. This module covers how to choose metrics that reflect real outcomes, not just activity, so you can track whether your solution is actually working.
Three Tools You Can Use
We have a problem statement. Now we need to know how we'll measure progress — because without the right metrics, we can't tell whether we're solving the problem or just staying busy.
Three tools help us define better metrics: SMART (what good metrics look like), leading and lagging indicators (how to find the right one to track), and the value-cost ratio (a whole-of-government lens for assessing return on investment).
Tool 1: SMART metrics
Metrics matter because they keep us honest. But not all metrics are created equal. "Make the website better" tells you nothing about whether you've succeeded. A specific, measurable, time-bound target does.
Tool 2: Leading and Lagging Indicators
A well-formed metric can mislead if it's measuring something too far from the actual outcome you care about. Leading and lagging indicators help you find the right point on that spectrum. Indicators close to the outcome are the most meaningful but slow to appear. Earlier signals give you faster feedback. The skill is knowing which to track and how to interpret each in relation to the other.
Tool 3: Value-Cost Ratio (VCR)
The VCR measures units of value generated per dollar spent. For government teams, the value-cost ratio adds one more lens: how much value is being generated per dollar spent? It doesn't tell you whether a number is good or bad in isolation, but it sharpens the right questions when it's time to make the case for continued investment.
Exercise
Identify the most appropriate metric for your problem statement.
Map your leading and lagging indicators to locate that metric on the chain.
Derive your current VCR. What would need to change to improve it?
⏭️Next Guide: Assumptions and Risks
↩️Return to: Product Thinking Course