This question and answer series of articles provides scenarios for business owners to find answers to business frustrations. Today I discuss the importance of measuring your business.
Q: In past columns you have talked about measuring everything. This seems to me to be a waste of time and energy. I realise there are things I need to measure, but where do I draw the line of common sense?
You’re right. Too much measuring confuses and obscures the issues and is just as bad as too little. What you want to measure is anything that will give you clarification and help you make effective decisions about the direction of your business. Every business is an intricate web of interlocking systems – even if you don’t have them documented (and if you don’t then you won’t have consistency and predictability because the outcome of the system will be dependent on who is driving it). Just measuring the dollars is not enough. You want to track and measure the things that make the dollars move in and out of your business. Start to think of the key systems in categories. What are your marketing systems? Your sales systems? Your production and delivery systems. Do you have recruiting, hiring, training and management systems in place and how effective are they? Now, out of these, make a start and decide which have the most impact on the business. Of course, if you are going to measure anything, you will want to set yourself standards; what is acceptable, what is not and what is outstanding? All businesses are different as are their owners and the degree to which you really understand what is happening in your business – and act on it – will generally correlate with your success.
Watch for Part Thirty-Six of the Q & A series…coming next week!
Until next time…
P.S. Learn more about working ON your business–talk to the coach! Click here to connect with me!