Key Indicators, How they will Benefit your Business
Key Indicators allow you to track the health and growth of your business. By deciding what values are critical, then measuring them over time, you can determine exactly where you are in your progress towards your business development goals.
Most business owners would argue that they have a ‘good feel’ for their businesses. This is probably true but it is not sufficient to be successful. The Key Indicators in your business need to be defined and a schedule established to track and measure your progress towards them over time.
Key Indicators can be used to track both measurable and implied areas of your business.
Measurable Key Indicators are values that you can actually calculate or determine by looking at the operations of your Business. Typical examples include: - Net Profit, Growth Rates, Sales Person Calls and Production Rates etc.
Implied Key Indicators are values where you establish the best case and worst case values and then assign a measurement value at a point in time using your judgement. These values may not be able to be determined by looking at the operational metrics of your business. It may be useful for you to document exactly how to arrive at a value. Typical examples include:
- Customer Satisfaction, Market Leadership and Employee Moral etc.
To begin tracking Key Indicators in your business:
1) Consider where you are and where you want to be.
2) Determine the areas that need tracking in order to reach your Business Development Goals.
3) Determine the range of values you will use to measure a Key Indicator, these may change as your Business Develops.
4) Develop a description for the Minimum and Maximum values that you will use to measure the Key Indicator (This will assist you when measuring the values).
5) Measure the current value of the Key Indicator.
6) Schedule a task for the regular measurement and evaluation of your progress with the Key Indicator so you can track where you are over time.
You should share the measurement and evaluation responsibilities of Key Indicators with employees and managers in your business. You will find that once you start using Key Indicators to set the goals and parameters of your business, you and your employees will become aligned and begin working towards achieving your Business Development Goals.
Be bold but realistic in setting your Business Development Goals. By defining and then measuring Key Indicators there is a good chance you will reach and exceed what you have set as the best case scenario.
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ABOUT THE AUTHOR
Business System Manager Software allows you to define Key Indicators in your business also assisting you to create Tasks and Business Systems to ensure that the Key Indicators are measured and reviewed. Start a Free Trial Today http://www.BusinessSystemsManager.comJustin Woolich has been involved with the Development of Innovative Business Software for over 12 years. He is passionate about assisting Businesses with Software for Business Development. http://www.BusinessSystemsManager.com/AboutJustinWoolich.aspx