Using statistics to monitor and manage business success
As we ushered in the New Year, I am sure many of us made the typical New Year’s Resolutions, and are looking forward to a successful year for our businesses and ourselves. Hopefully we have all established or renewed our goals and plans for this upcoming year. This is the perfect time of year to also determine the means for measuring our progress toward attaining those goals. For those of you who already have measures or statistics in place, this is also a good time to review, and if necessary, revise them.
The simplest definition of a statistic is a numerical fact or data. Examples of statistics can be readily found in sports, in measuring the state of the economy and even in weather reports. In establishing statistics for ourselves, we should look at all the different areas of our businesses and even our lives to find the best way to measure each of them. An obvious statistic for most of us is income, but there are many other statistics that we can and should define. Although we want to increase income, we realize that it is even more important that we are profitable. To ensure profitability, we need to regularly review production and the costs associated with production. By knowing our costs, we will be able to establish production targets and then work toward regularly achieving them.
Even though over-all income and production are important statistics to keep, there are many other measures that are important to have in place. Depending on your particular business or situation, these may include sales, estimates, leads, new clients, and some measure of your promotion. The list can be relatively short or very lengthy. The important point here is that your list is meaningful to you in helping you to measure your progress and adjust your plans.
Just as sports teams keep both general and specific stats, you can develop both general and specific statistics for your team. These would include the team, or business, stats as well as individual stats. Just as coaches use individual player statistics to help improve the performance of the players and ultimately the team, you can establish individual staff performance statistics for members of your team to assist your business in becoming more profitable.