In a series of short articles we’ll look at what it takes to grow your business.
Monitor your progress to reach your targets
When you’re driving, there are certain things on your dashboard that you keep an eye on – your speed, your fuel level, and the engine’s temperature.
So, shouldn’t you do the same for your bisiness ? You need to set up a business dashboard with 3-5 key things you’re monitoring regularly.
Use this four-step process to create your own dashboard:
1. Determine which Key Performance Indicators (KPIs) should be on your dashboard.
These KPIs should have the greatest influence on you achieving your goals. For example, it could be the average amount of each invoice, your gross margin for any job (usually something like sales minus material costs), the average transaction value for a certain period of time or how often your customers buy from you.
Which of your KPIs, when increased or decreased, will have the biggest impact on your future results? Choose no more than five to measure and have on your dashboard.
2. Work out how to measure your chosen KPIs.
The measurement process should be automated wherever possible. Most accounting software will measure your financial KPIs and if you’re not sure we can help you.
3. Produce a simple one-page report.
Produce this either weekly, fortnightly or monthly to track your results and progress. Set aside time to go through this report every time it’s produced and share the results with your team if you have one.
4. Repeat these steps with your team.
Identify the KPIs each team member should be monitoring. These will be different from the KPIs for your overall business. KPIs help your team understand the definition of a great day’s work for them. Monitoring and reporting the KPIs regularly will help your team know if they’re on track.
“Successful businesses measure and count things… unsuccessful businesses either measure nothing, the wrong things, too many things, or finally, they measure the right things, but they don’t communicate the measurements efficiently.” – Dick Costolo
In the final part, part ten we will look at the importance of looking after yourself and your general wellbeing.