Metrics: Are Yours Helping You Grow Your Business?

MetricsDo your business metrics keep your business focused and moving toward your vision? As a small business owner or CEO of a small business you are paid to describe the future (your business plan) and then create it. This requires vision and execution. The path to any vision is rarely as smooth in execution as it is on the drawing board. Like most flights on an airplane getting off course is expected. The key is how quickly you and the pilot can course correct.

To make mid-course corrections you need an instrument panel or dashboard.  The business dashboard as a metaphor for critical metrics to measure business performance originated years ago at General Electric.  Just as you use the speedometer, oil gauge, fuel gauge, and other instruments to monitor the status of your car as you drive, you want to keep track of key indicators of the performance of your company. Like the dashboard gauges, your metrics allow you to continually assess your progress and detect any potential problems.

An effective dashboard provides you with the information you need to make good decisions that keep your company out of harm’s way and moving in the right directions. This means that you must select reliable and predictive metrics. Armed with the information they provide, you must be able to use them to help decision making. This isn’t always easy. Consider the fact that Federal Reserve Chairman Ben Bernanke and other top central bank officials failed to see the housing crash coming as late as December 2006.

With all the resources at their disposal coupled with the years of experience identifying economic trends, how did they miss the biggest financial crisis since the Great Depression? Were they looking at the right metrics? Or did they interpret them wrong? Or did they just make poor decisions based on what they saw? We may never know. But their failure to execute on this key leadership lesson points out how important it is to have metrics that inform you well enough in advance to take corrective action. 

Your choice of business metrics and the importance you give them show what you value. If you value customer service or new product development, for example, you make them central to your business metrics. You include it in your dashboard.

By instituting key business metrics across functions and groups and at every level, you directly link individual performance to measurable outcomes. This sends a clear message that not only do you care about customers and revenue, but so should everyone else, since they are accountable for the results measured by their particular metrics. Clear accountability is essential for executing this leadership lesson.

Whether you manage a small administrative staff or a  global company, you need business metrics to keep your business on track. Having a solid business plan is essential but that’s not enough because of the dynamic nature of the marketplace. This is especially true for small- and medium-sized businesses. Juvo Products manufactures assistive living products for seniors and people with mild disabilities. Because they are a growing early-stage business they must remain extremely nimble. As Park Owens, President of Juvo Products explains, It’s a matter of how quickly you adjust and how flexible you are. How quickly you can react.  I would say 50% of our business plan was right on and 50% was off.”

When establishing metrics, beware of metrics that:

  • aren’t easy to collect data that’s accurate or complete
  • are complex and difficult to explain to others
  • complicate operations and create excessive overhead
  • cause employees to act not in the best interests of the business, just to “make their numbers”

John Menzer, CEO of Michael’s describes how he and his management team use metrics to manage their business. “We talk about what we saw in our stores and we ask,” What are the three things we need to adjust for the weekend to maximize sales and earnings for the weekend?” And we make those changes on Friday. What do we see in competition? How are the promotions doing? Do we need to make any adjustments because of that? So we’re running the business on a kind of weekly basis, but our Merchandising Team is probably running on a daily basis. Even marketing is maybe running on a daily basis now because the economy is just so tough. We are changing on the fly even based on weather. We’re now using weather service and we’ve incorporated that weather service into our modeling and pricing and promotions. So if we know a snow storm is coming, we’re going to get that promotion in earlier rather than later.”

If you are committed to accelerating your company’s speed to vision you need to ask yourself the following questions:

  • Do your metrics allow you to proactively respond to challenges and opportunities?
  • Do you have systems in place that make it easy to regularly monitor your metrics and course correct to achieve your goals?

Your honest responses should go a long way for you putting in place the metrics and systems you need to navigate in today’s tough economy.

Increase Sales with Your Time Management Practices

Want to increase sales? Analyzing your time management practices is a great  place to start. Time management practices are what you do and how you normally  manage your time. Research shows that effective time management practices are  one of the greatest contributors to high performance.

Time management practices reflects what you routinely say “yes” to as well as  what you say “no” to. It is these moments of decision that separate the higher  performers from the also rans. High performers are proactive because of the time  management they develop. They gain an unfair advantage over their competitors  because they attack the marketplace based on their personal strengths and  knowledge instead of reacting to the conditions set by others.

Because they are more strategic in their approach to their jobs, high  performing salespeople are able to keep focused on what’s important. They employ  clarity of purpose, consistent communication to the marketplace, commitment to  taking right action and the discipline to execute. These salespeople achieve  excellent results because they know:

  • Their clients and the pain they are experiencing.
  • How their product addresses the pain.
  • What message clients need to hear to make a decision.
  • How to move their clients from decision to implementation.
  • When they can’t win.

Because they have a clear and consistent strategy for approaching the  marketplace, they are able to focus on important and winnable sales  opportunities. They don’t get distracted by periodic “road kills” that  may litter the highway of a major sale. They also don’t get seduced by the  allure of landing the “big elephant” when their chances of winning are slim or  none.

The quickest way to zap your time and income is to spend $1,000 in selling  effort to land a $100 commission.

To make sure they are pursuing the right opportunities, they ask themselves:

  • Is there a fit between the client’s needs and my solution?
  • Can I win?
  • Is it worth pursuing?

By developing the discipline to ask these questions regularly, answer them  honestly and then acting on the answers, successful salespeople are able to say  “yes” to the right opportunities and “no” to the wrong ones.

One key time management practice is mentally planning the day before it  begins by visualizing what you need to do for the entire day. Research from a  variety of organizations determined that this practice is one of the most  distinguishable characteristics among high performance people. The techniques  used may vary from formulating a “to do list” just before going to bed, to  planning the day while showering. But, high performers develop the specific  discipline of mentally starting the day before the activities actually  begin.

Remember, if you don’t manage your time someone else will. Commit yourself  improving your time management practices and watch your sales increase

For a Free Assessment of your time management practices go to:http://www.philfaris.com/wp-content/uploads/2011/07/Time-Management-Practices-Assessment-Exercise_2.pdf

Article Source: http://EzineArticles.com/6441602

Are You Pursuing The Right Sales Opportunities?

Success in today’s competitive marketplace often comes down to pursuing the right sales opportunities. This article explains why this is important and how you can make sure that you do it effectively?

The Problem

Many sales forecasts are missed and sales careers sabotaged by salespeople spending their time pursing the wrong sales opportunities.  This usually occurs because the salesperson reacts to the marketplace instead of attacking it strategically.

The Solution

High performing salespeople are more strategic because they focus on what’s important.

What sets these high performers apart is their ability to employ clarity of purpose, consistent communication to the marketplace, commitment to taking right action and the discipline to execute. These salespeople achieve excellent results because they know:

  • Their clients and the pain they are experiencing.
  • How their product addresses the pain.
  • What message clients need to hear to make a decision.
  • How to move their clients from decision to implementation.
  • When they can’t win.

Because they have a clear and consistent strategy for approaching the marketplace, they are able to focus on important and winnable sales opportunities.  They don’t get distracted by periodic “road kills” that may litter the highway of a major sale.  They also don’t get seduced by the allure of landing the “big elephant” when their chances of winning are slim or none.  The quickest way to zap your time and income is to spend $1,000 in selling effort to land a $100 commission.

To make sure they are pursuing the right sales opportunities, they ask themselves:

  • Is there a fit between the client’s needs and my solution?
  • Can I win?
  • Is it worth pursuing?

By developing the discipline to ask these questions regularly, answer them honestly and then acting on the answers.  Successful salespeople are able to say “yes” to the right opportunities and “no” to the wrong ones.