It's a common saying in the business world that says if you are not measuring it you are probably not managing it. So what does that actually mean, and what is it you should be measuring?
Traditional measurement is done by every company in the form of accounts, recording and reviewing the financial achievements or losses of the company annually, monthly and in some cases daily. There are probably not many that would argue against keeping an eye on profit and cash - but what about other measurements not related to company finances?
There are other things that businesses may choose to track such as number of customers, number of quotes or complaints, units output, number of accidents, the list could go on and on - and each list can be different for each organisation. So how does a good business measure all these in order to manage itself?
What about those aspects of the business those are difficult to measure such as engagement levels of your staff, strength of the brand in the market place, how does your product rank against your competitor? These things can be hard to pin down.
Is it any wonder that smaller businesses stick to what is easy to get access to? The problem with just accounts is that you are only monitoring the performance you achieved in the past, and due to the time it takes to get accounts this could be days, weeks or even months before so the problem that caused these financial losses could have changed.
So what is the answer? Well consider this. You wouldn't drive your car just by looking in the rear view mirror, and the same should be said for your business. To drive a car you have a whole dashboard of measurement monitoring all those things important to you achieving your current journey and future journeys. Some might say, "Ah but as a small business I don't have time to create, maintain and monitor lots of different measurements." Agreed, but likewise when you are driving your car you don't constantly look at all the dials on your dashboard. In fact you take an occasional glance at a time that fits with your journey or there is a need to monitor them. The same principle applies to measuring your business.
So the key here is having the right measures, monitoring the right parts of your business, and being reviewed at a time that is right for you to react to any change.
The Balanced Scorecard approach to business performance measurement can help to capture data on key targets that can be tricky to measure. It not only looks at financial targets and achievements but adds three extra perspectives: Customer Perspective; Internal Business Perspective; and Learning & Growth Perspective.
By setting KPIs within your business that can measure all these aspects of business sustainability and success, you will gain a well-rounded, in-depth view of where your business is excelling and where it is not doing so well.
Ateeya Manzoor is a managing director and management strategist and partner at Mayfair Management Group.
As a professional with over fifteen years of experience, Ateeya Manzoor has worked with a large range of clients in various industries and sizes, ranging from large publicly traded financial institutions and technology firms, large resorts to midsized oil and gas companies, to small non-profits requiring a fresh perspective.
To read more, please visit here: http://ateeyamanzoorpost.simplesite.com