How Does Your Business Measure Up?
A monthly “Key Indicator Scorecard” can help you track your business performance on a monthly basis
All too often we find ourselves in the middle of the daily grind of our business. We can easily find ourselves driving our business by looking in the rear view mirror. Wouldn’t you prefer to drive your business by looking through the windshield and glancing in the rear view mirror? The day-to-day operations take precedence and we don’t get the opportunity to step back and take a look at the things that drive our business. When was the last time you took a look at your company, and how did it measure up? What indicators did you consider?
A monthly “Key Indicator Scorecard” can help you track your business performance on a monthly basis. Your key indicators should help define the performance of your company, your managers and your employees. By taking a look at the key indicators for your business on a monthly basis, it can help you make small adjustments to help keep you and your staff focused on the goals of the company.
Consider the key factors that can affect your business on a daily basis. Contract revenue should be one item that you consider. Do you have a target each month? If you have more than one project manager, you should track and report their revenue each month. Involve them to help you project each month and then aide them in meeting their goals. This will help them to understand their contribution to the company and help hold them accountable. Add to that how much they were able to estimate. How many leads did they visit and what was the value of these estimates? Help your project managers set goals for the number of leads they should be able to estimate each week. Show your teams their batting average. The close ratio on a job lead should be considered when building your key indicator scorecard.
Cycle times on jobs are important factors. The longer a job continues, the more likely your customer will be unhappy. The cycle time is directly related to customer service, which will directly affect your profit on the job. Tracking jobs within specific categories of price range can help you understand if your team is being efficient.
Collections are another indicator your teams should be aware of. Getting their involvement can only help your accounts receivable.
Customer service is another indicator that you should track. By understanding if your clients would recommend you to family and friends, you can track your results and monitor customer service. If a customer provides negative feedback, do you have a method for following up?
There is a lot of information to consider when building your Key Indicator Scorecard. Entering the information on the front end is paramount. If the data is entered falsely to create a different outcome, your data will be skewed. Many of you are using software that can extract this information with a minimal effort from your staff. There are a number of software programs available to assist you in your business if you are not already using one. By extracting this data monthly and meeting with your staff to go over the goals, you can help steer your business. Have your project managers come prepared to share this month’s goals and expectations. At a minimum they should be prepared to share their expected contract revenue, invoicing goals and collection goals for their teams. Getting them involved in bringing their goals helps them to buy into the program. They will also have the feeling that they are included in steering the business with you.
By creating a Key Indicator Scorecard and monitoring it monthly, you can assist your managers in developing their teams. The scorecard gives you the tools to evaluate performance of teams and help coach the managers to success. Take time out in your meeting to reward the teams that have consistently performed well. Coach the teams that struggle and help them create action plans to obtain their goals. This will develop a system of accountability and reward.