I’m a believer in the power of measurement, which is why it’s one of the important tools that Small Fish uses with clients.
It’s been said that Peter Drucker stated that “What gets measured, gets done,” but it appears that may be stretching his words a little. Nevertheless, I’ve directly experienced the power of measures and metrics in many different contexts.
The business world might have you believe that it’s all about measuring the money – particularly, revenue, margins, and profit. I don’t have a problem with those, but they often don’t give much guidance for day-to-day decisions.
Should your front-line employee give a refund under somewhat questionable circumstances? If they do, revenue and profit will go down in the short term. But revenue and profit might go up in the long term, because that customer is out giving testimonials to their friends.
But the employee isn’t sure, so she’ll seek help from your company policies and guidelines, or her supervisor, or perhaps from you. Maybe that’s one reason why you’re running around addressing a thousand little trivial decisions all day.
You’re frustrated, perhaps. You thought you’d captured this in the employee training, yet you’re still getting these kinds of questions.
Oddly enough, this might just be fixed if you measured the right things. What if:
· You knew that employees understood and internalized the employee training?
· Your employees knew that their personal success was linked more to customer satisfaction than to the daily sales total?
· You made a big deal of every customer-satisfaction success in front of the employees?
These are exactly the kinds of conversations I have with my clients, as we search for the right balance of measures which powerfully represent the goals of the business. Every company is different, because the goals are different.
Just don’t get too many measurements in place. Each one represents work and expense, and having too many sends the message that you’re not focused on anything in particular.
How do you measure your progress towards success in YOUR business?
Small Fish Business Coaching Fort Collins
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Do you ever look at the reports from your accounting software or are they meaningless to you?
A typical set of Financial Reports contain a lot of numbers but reading them can be daunting, hiding the critical numbers to success.
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A recent article by VECCI (Victorian Employer’s Chamber of Commerce and Industry) quoted ASICs figures showing that nearly 10,500 businesses entered external administration in 2011. Many were small businesses and analysts suggest the higher number of insolvencies is due to a crackdown from banks and the Australian Tax Office, which are pursuing unpaid debts and tax liabilities harder than before.
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