Almost all online campaigns need to be optimized. While there are a number of software packages available to assist you with this, most beginning internet marketers do it manually.

One of the most common questions is, “When do you know whether a test was successful or not?”

The precise answer is, “It depends.”

Obviously, the more data you collect, the more information you’ll have and the better decisions you can make.

But this is expensive.

You can run very short tests to save money, but the chances you’ll make bad decisions increases considerably.

There is a free online tool you can use to get a better feel for the statistical significance of a test you run. In other words, it will estimate the range of your result, allowing you to decide if it makes sense to continue a test.

The website is the Exact Binomial and Poisson Confidence Intervals page. (Don’t let the title scare you. It’s easy to use.)

Here is how you can use the page to determine whether you should stop or continue a test.

First, scroll to the bottom of the page and change the confidence interval from 95 to 90%. While 95% might be good for scientific research, it is just too expensive for most of the internet marketing you’ll be doing. (A 90% confidence interval means you’ll only be wrong about your decision 1 time out of 10.)

The actual calculation is easy. Go to the Binomial Confidence Interval section of the page. Enter the number of conversions you got from your landing pages in the top box, and the number of visitors to your page in the bottom box. Then click compute.

You’ll get back the exact ratio (in this case, 0.030, or 30%). The important numbers are below that. They represent the upper and lower estimate of how your page actually converts.

In this case, if you get 3 conversions after 100 visitors, your actual conversion may be as low as 0.8% and as high as 7.6%.

So, should you continue your test? It depends!

If you’ve calculated an acceptable ROI at 4% conversion, it totally makes sense to continue the test. On the other hand, if you need a 7% conversion for an acceptable ROI, it probably makes sense to stop the test.

Have any questions? Leave them in the comments and I’ll get back to you!

Yes, both of these are real fears for those of us heavily involved in a lean transformation.

When we hit the wall one of two things happens.  Sometimes the lean program gets a back seat and dies a slow death and in other cases the CEO wants lean spread fast with direct accounting for bottom-line results.  Then we get cookie-cutter lean (e.g., spread the kanban, standardized work sheets everywhere, etc.) and managers who are accountable for results or else.  Often that means lean audits of various kinds.

Jeff Liker: Lean Has a Short Half-Life Without Intense Involvement Of The CEO » The Lean Edge.

Twisted Dazzle, the band for which my daughter Emily is the drummer, got to play outside in downtown Appleton, Wisconsin, to help “motivate” the runners of the May 7, 2011 Sole Burner up the hill by Lawrence University. It was a perfect day, and they sounded great! Here’s one of their new cover songs – Let’s Get the Party Started by Pink.

During the end of their performance, they had a fun surprise visit from the Harmony Cafe Coffee Cup mascot!

Here are some basics of Systems Thinking that I pulled together for some colleagues recently.

A process is a series of steps intended to achieve a specified output.

A system is two or more processes where the behavior of each process has an inter-dependent effect on the behavior of the whole. (You can’t change one without affecting the other.)

Processes focus on completing tasks . . . Systems are goal seeking and therefor adapt to changing conditions. (Organizations that focus on completing tasks rather than achieving goals are called bureaucracies.)

A system’s effectiveness as much on the health of the individual processes as it is on the interactions between the processes.

You can’t understand a system by taking it apart. (Example: You can’t understand what a human is by studying the heart, lungs, etc., in isolation. You understand the heart by understanding its function, as well as its effect on other functions of the body.)

Systems are only understood by knowing the purpose of the system as well as the functions of the system, i.e., why things operate as they do. You must understand the ‘why’ before you can design an optimal ‘how.’

You can’t optimize a system by optimizing (problem solving) the parts.

The parts must be designed to optimize the whole. You can only do that if you know the target condition of the system.

In order to understanding, design, or think about a system, you must consider:

• What is the objective of the system overall?
• What is the pathway design of materials, information, and services?
• What are the connections between process steps?
• How do people do their work at each process step?
• Each of the design elements must be self-diagnostic. (Jidoka!) Every time a system has a problem, it is an opportunity to better design the pathways, the connections, or the activities.

You can’t design a perfect system, only discover one.

Systems Thinking – Additional Reading:

• Steven Spear – “The High-Velocity Edge“
• Russell Ackoff – “Ackoff’s Best: His Classic Writings on Management“
• Peter Senge – “The Fifth Discipline“

I’d love to hear any thoughts or recommended reading you may have on systems thinking!

I’ve been fortunate to have attended the last two System Seminars on Internet marketing. Ken McCarthy, who puts on the seminar, was one of the original pioneers to promote the opportunity of marketing on-line. He sponsored the first conference on the subject in 1994 with the cofounder of Netscape Mark Andreessen.

I attended my first system seminar in 2010, held in Chicago, as well as in 2011, when it was held in New York City. (The 2011 event was the last System Seminar open to the public!)

In the year between the two seminars, I participated in the weekly Smart Beginners coaching course. This training takes you, hands-on, through the basics of Internet marketing. We covered such topics as WordPress blogs, article publishing, auto responders, getting traffic, etc.

Towards the end of the year, it became clear to me that one of the largest barriers for somebody trying to market online is not with learning any of the parts or pieces. Rather, the challenge is putting all the parts and pieces together into a cohesive whole that works. Or, if things don’t work, figuring out what peace needs to be strengthened.

I volunteered one Saturday morning to take the class through a method that I use to simplify work processes. The method is generically called hierarchal function analysis, but it also goes by different names such as task analysis. While there are a number of different flavors of the method , the basic idea is that you link together what you want to accomplish with why you are doing it, and then specify how to do it. By linking activity to purpose, and purpose to activity, you ensure the most effective use of your time as well as identify those areas in your process that need to be strengthened.

I’m posting the video below in its unedited form so that others can benefit from this training. You can download the Task Analysis slides here.

I’m finally getting around to posting my presentation on lean that I gave at the 2010 BYU Chemical Engineering Alumni Association Dinner, held in Provo, Utah, October 8, 2010.

The title is Stories from the Dojo: How One Japanese Company is Improving Everything from Your Consumer Products to Your Health Care. The purpose was to provide an introduction to Lean to the alumni association. The video is 23 minutes long, and I’ve provided the full transcript below.

Click to see full transcript >> [Continue Reading]

Twisted Dazzle played at the Outer Edge Stage in Appleton this past weekend as part of the Kids Rock Benefit Show. The band did great! Here are a couple of clips. The third video was a surprise drum solo Emily performed to fill time during a band blooper moment.