Doing This One Thing Will Improve How You Manage Your Company
Building a company is hard. Really freaking hard. You’re simultaneously pulled in dozens of directions. Everything needs your attention. You scramble to keep all the balls in the air.
It’s easy to lose focus. So what do you do?
Here’s what you do. You stop, take a breath, reconnect with the vision of the company, and reset your priorities.
Then you fall back into the same cycle.
Here’s a reminder on how to stay focused on the most important priorities…
You measure them. “What gets measured gets managed” (thanks Peter Drucker).
And how do you do that? You have each manager establish a clear plan of action for his/her department and you hold each other accountable.
Another effective way to measure your progress is to create a weekly dashboard for your management team. Update it every week and you use it as the method for tracking your KPIs.
This has worked very well in several businesses I’ve been a part of. It creates a forum for everyone to be accountable to each other on how the business is running. It’s typically a one-pager that covers the most important metrics of the business.
KPIs I’ve seen on dashboards of companies include some of the following:
- Last week’s sales
- Avg sale price
- Revenue vs budget and vs same period last year
- Revenue by channel vs budget
- Gross margin
- Inventory level vs budget
- Fill rate
- Current cash level (weekly) vs budget (monthly)
- Cash burn and # of months of cash remaining
- DSO (Days of Sales Outstanding)
- Marketing metrics – # of email subscribers, social following
- Current sales pipeline
If together your management team looks at business metrics every week and every month, it will make everyone smarter about the business. It will help everyone see what the priorities are. It will be a foundation for strategic discussions and will keep everyone focused.
So if you haven’t yet setup a weekly dashboard in your company, don’t wait any longer.