Have you got the information you need to succeed?

Ever heard the saying, If you can’t measure it, you can’t manage it?

I used to hear it a lot back in my corporate days. There used to be “Management Information” everywhere, with whole departments just to produce the stuff. Which is great, as long as it’s used effectively.

How about you?

Did you think when you started your business that you would need to create an MI team at some point? I bet not. In fact, it can be quite liberating in the beginning to not have reports in place, as they can feel constraining. They can even feel pointless when starting out. After all, there isn’t a lot of stuff to measure then, is there? But, as your business grows, you need to make the shift into business owner and something you will need to make this role easier, is good old Management Information.

Why do you need Management Information?

To keep control over your business

Having key information to hand, will enable you to see at a glance what’s happening, and if there are any issues that need to be tackled. It means you get to know what’s going on without having to do it all yourself, which is essential for growth. However busy you are, to have your key information at hand to give you a ‘helicopter’ view of your business can be a sanity saver.

To make effective decisions

Once you identify any issues, you can take decisions quickly on any changes that need to be made. For example, you will quickly see if you are not going to achieve your turnover target for the month and can look to change something during the month to fix that. Not having MI often means that you are always dealing with issues after they have happened and can be bumbling along unaware of what’s happening right now.

To be more productive

You will also be more productive by identifying what is working well in your business and what isn’t. You can then do more of the stuff that is working well and stop the stuff that isn’t. See? More productive.

To be more profitable

You will be able to quickly see what is making you money and what isn’t, and tweak things accordingly. Having MI will give you a tighter rein over your financial figures so that you can react quickly to any shortfalls and won’t be caught out by a drop in customer demand or an increase in supplier prices for example.

To delegate more easily

To grow your business beyond ‘start-up’ you will need to be able to delegate. Whether that is taking on employees or outsourcing key tasks. Having MI will help you to retain control, without actually doing the tasks, and also help you to manage the other person’s workload. So I hope that by now you agree that you need to have some MI in your business, which leads me to my next point:

Where do you need Management Information?

I suggest that you start with the 4 key areas of any business. You need to consider what information under each of these headings is important in YOUR business in order to effectively manage it. Here are some ideas to help get you started, but just remember, you know your business best, so feel free to come up with your own.

Financial

  • Turnover (month to date, year to date)
  • Costs (month to date, year to date)
  • Forecast profit (month to date, year to date)
  • Late payments / Bad debt

Customers

  • Leads
  • Sales volumes (total, and split by product / service type)
  • Website stats
  • Customer satisfaction measure

Suppliers

  • Unit costs by supplier
  • Invoices received
  • Service levels

Team / Employees

  • Costs
  • Satisfaction measure (theirs and yours)
  • Work completed measure
  • Quality control

Some of these may be relevant to your business and some may not. If you spend only 10 minutes thinking about this I bet you’d come up with a great range of measures for your MI.

How do you put it in place?

Once you’ve decided what you want to measure, then use a way that fits you and your business to record it. After all, that’s the benefit of being the business owner, you can decide how you want to capture it and view it.

Some suggestions are obvious things like a spread sheet or a database that you (or someone in your team) keep updated. But it doesn’t need to be anything high tech. You can use a good old notebook and pen if it works for you.

Finally, a word of caution. You don’t want to end up creating lots of extra work here. Whatever you come up with has to add more value than the work it takes to produce it.

And, once you’ve decided what the important numbers are in your business, set up a regular time to update and review. I’d always suggest weekly, so that you can react quickly to anything that is not on target. Pick a regular date and time to get it done, and book it out in your diary now!

How do you keep your business under control? Let me know in the comments below!

 

photo credit; deathtothestockphoto.com

Take yourself out of your business for one day!

You may often hear people like me (aka Business Coaches and the like) banging on about the need to spend more time working ON your business and less time working in it.

But just what does that mean?

What exactly should you be doing in that time working ON your business?

Firstly, it definitely doesn’t meaning spending an hour or so on social media, reading newsfeeds, sharing funny quotes and re-tweeting other people’s content.

As a general rule of thumb, working ON your business is about working on longer term goals rather than short term wins.

It’s about getting back in control, versus feeling out of control.

It’s about being proactive instead of reactive.

It’s about growing your business, as opposed to maintaining it.

It’s the important, non-urgent work, not the urgent but unimportant stuff.

Working IN your business is where most small business owners are spending their time – in other words, they’re doing a ‘job’.

In order to grow your business and achieve your goals, you simply have to commit to spending some time to work ON it.

But, you may still be struggling to understand exactly what this means to your business, and just what exactly these important jobs are that you should be doing.

So, to help you do this, here are some specific areas you should be focusing on as a business owner, and where you can work ON your business.

Strategic Planning

This is about stepping out of the day to day, and looking at your business from a ‘big picture’ perspective.

Typical activities to consider here include:

  • Produce a Marketing plan
  • Review your goals and long term objectives
  • Competitor research
  • Assess the resources you need to achieve your goals e.g. new website, new premises, team members etc.

Profit Planning

This is about understanding where your profit comes from, what your targets are and how to manage your business to achieve these targets.

Typical activities to consider here include:

  • Review your pricing and margins
  • Monitor and manage your outgoings
  • Assess how to increase customer average spend
  • Negotiate with your suppliers

Marketing

This is about being clear on who your target client is, communicating your message to them, and building the relationship.

Typical activities to consider here include:

  • Implement your Marketing plan
  • Follow up on leads
  • Design and review your ideal client profile
  • Keep in touch with current and past clients

Your Team

This is about making sure you have the right people, and the right skillset, around you to grow your business and achieve your objectives.

Typical activities to consider here include:

  • Delegate more of the ‘job’ type work
  • Develop and lead your team, whether inhouse or outsourced
  • Identify and create the job descriptions for your team
  • Your own development as a leader and a business owner (often overlooked!)

Innovation & Product Development

This is your creative time, to assess and improve your current offerings and identify which new ones to progress.

Typical activities include:

  • Review your current offerings and see how you can improve them
  • Decide which offers to remove if they are not selling or not profitable
  • Progress ideas for new offers and test them
  • Survey your customers for their feedback

Systems & Processes

This is all about putting systems and processes in place that will free up your time from doing the ‘job’, and improve the customer experience

Typical activities include:

  • Automate your monthly invoicing
  • Standardise your new customer process
  • Map out your credit control process
  • Create templates of emails and documents that you regularly use

So, the above suggestions should have given you some ideas on exactly what you should be doing to work ON your business, but how do you fit the time in to get it done?

Here’s how

Weekly

Schedule in your diary for an hour at the start of each day to work ON your business. If you can’t manage an hour, then do what you can. If you can’t manage each day, then do what you can. You’ll be amazed at the progress you can make in just 30 minutes, 3 times a week.

Monthly

Schedule in a day (or half-day) to focus on the business owner tasks.

Quarterly

Take yourself out of your business for a day, solely to work ON your business.

Book these times in your diary right now, and then do it!

No-one else can make it happen except you.

What action are you going to take right now? Leave a comment to let me know.