Susan and I had the opportunity last weekend to be interviewed on the Biz Talk radio show where we talked about the importance of planning for small businesses. As promised in our last blog, today I am going to blog about some non-financial measures that small businesses might track. Pick and choose or add your own to measure progress toward your business goals.
First, let’s focus on acquiring customers. If your company has a goal of increasing customers, you might begin by tracking any number of the following items: the number of new leads, the number of leads contacted, the % of leads which turn into prospects, the number of new clients, the % of prospects which turn into clients, the number of prospect contacts required to move the prospect to a client, the total sales to new clients. The information gathered from these measures can help you fine tune your sales process.
For tracking customer satisfaction you might track customer returns, complaints, the time it takes to return phone calls, the time from order to completion, the number of on-time deliveries, how close your estimates are to actual invoices.
To track the effectiveness of your marketing efforts you might track where potential customers heard of you, the number of new accounts per marketing campaign, and the total sales dollars per marketing campaign.
If you are trying to track efficiency, you might keep track of time to complete billable services, unbillable activity hours, set-up time, lead-time, defects or time spent correcting errors, scrap or waste in manufacturing, parts availability or extra trips to get parts for service technicians, and of course, production rate per hour or per day. By tracking some time and productivity measures, you can begin to hone in on practices which are taking too much time and then can search for technology solutions or implement better procedures to solve these problems.
And if you are trying to build a motivated team you might track employee turnover rates, suggestions for improvement per employee, number of employee suggestions implemented, new product or service ideas, training hours for skill improvement per employee, employee participation in non-business related company activities (i.e., service projects, family picnics, etc.).
Track the measures you choose in the most efficient manner possible, whether that be taking advantage of a feature already available in a software program that you own or whether it be as simple as tracking it on a spreadsheet. And then, as with budgets and all business planning tools, the key is to analyze the data that you track and make appropriate adjustments where needed to move your business closer to your goals.
What non-financial measures do you find most useful to track for your business? We would like to hear about your experiences.
Tuesday, February 2, 2010
What Non-Financial Business Measures Do You Track?
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