They look at a Weekly Action Snapshot of their entire business.
In 1 single page of information, they can see a quick Snapshot that tells them, with military precision, where they need to take Action.
As an avid runner, I’ve become somewhat obsessed with a website called RunKeeper.com. It tracks your running time, distance, and even your route on Google maps. Heck it can even be tied into your GPS-enabled, heart-rate-monitoring, super-spy watch to help you track your performance. In other words, it helps me track, and therefore improve, my vital numbers for running:
- Elevation Changes
- Heart Rate
If only it could track temperature, humidity, and my diet I’m pretty sure it would be the ultimate training tool.
In business we also have crucial numbers. No matter if you’re training for a marathon or a 5k, the numbers you watch don’t change but the values of the numbers certainly do. Business works the same way. For the most part, we all need to track the same numbers… However, the actual value of those numbers can vary significantly.
Let’s get this out of the way right now, when you’re bragging to your buddies or when it’s time to actually sell your business, the revenue and profits are important numbers… While you’re actively improving your business, they are secondary.
However there are numbers that every business needs to include as part of your Weekly Action Snapshot report (WacSnap).
Keep in mind, if you’re not looking at the right numbers, everything you do in your business from marketing, to incentive plans, to scheduling, to hiring a new employee is a BIG guess. Imagine training for a marathon without ever tracking how far you ran or how long it took you. On race day, how would you even know if you could finish?
To make it simple, categorize your numbers based on department:
- Sales – # of new leads, # of outstanding leads, conversion rate (i.e. # of new customers divided by the # of new leads)
- Marketing – # of leads per marketing project, $$ in revenue generated per $$ in marketing spent
- Service/Operations – completed work orders, unfinished work orders, on a monthly basis track your profit per person (or per sq. ft. for a retail environment)
- Finance/Administration – past due invoices, accounts receivable aging, total payables, cash in the bank
- Big Picture – YTD Revenue compared with previous year, your P&L should be reviewed monthly; depending on your overall goals, there can be completely different Big Picture numbers. For instant a cell phone retailer might look at the number of service contracts compared with last year or the number of cancellations you saved in the last week.
That’s a lot of numbers; 14 to be precise.
Don’t start tracking all of them at once. If you’re having cashflow issues start with #4. Otherwise, start with #1 and work your way down.
The number of new leads, where those leads are coming from, and the % of leads you convert to customers are your MOST IMPORTANT numbers.
When you go to sell your business, if you can tell people those 3 numbers, the buyer will be extremely impressed and pay more because of it.
The simplest way to have these numbers available each week is by utilizing some industry-specific software.
Brad Sugars developed a Business Chassis, that you can read about on his blog to point out exactly which numbers are key to your sales performance.
You can also read more about tracking the important numbers of your business and the crucial numbers you need to hold your Ad Agency accountable.
To your success,
P.S. If you’re a runner, cyclist, skier or enjoy some other form of aerobic activity, join my Street Team on RunKeeper.com. I find it’s a great motivating factor knowing others are “tracking” my performance. The same is true in business. The only thing better than reviewing your WacSnap each week is sharing it with peers to help you see areas for improvement that you might otherwise miss.