Tweak Your Biz » Management » Business Measurement

Business Measurement

by Barney Austen on November 2nd, 2010
13 Comments



Every day in business we engage in operational activities.

business measurement, business dashboard, effective management

We sell to customers (hopefully!), we pay our bills (if we’re being good!), we engage in meetings, we up-skill our teams, we stress over a particular problem (or perhaps two!).

Regardless of the business, we all do the above along with a whole lot more.

But how do we measure how effective we are?

The most boring topic in the world can play a part, but the concept of measurement moves beyond project management.

Every aspect of business can be measured to greater or lesser extents. The more it costs a business to perform a function, the closer it should be measured.

Sales teams have targets. Their success is critical to driving the success of a business. Chances are, this is being measured and monitored as it’s easy to measure. Sales targets are being met or they’re not.

But there are other aspects of business that should be measured as well;

Perhaps some of the following;

  • Customer satisfaction: perhaps there are surveys being conducted. How is the business measuring whether things are getting better or worse?
  • Cost of delivery: Examining the costs of delivering a business’ product or service. Is it going down or up? Could the business be getting better value so it can either achieve better margins of pass on the savings to customers.
  • Quality: Is the business delivering to its quality standards every time it delivers a product or service. Are those standards getting better? Or are they slipping?
  • Staff satisfaction: Has the business a contented work force? Are they being trained? Are they embracing the business ideals and methods? Could the business be doing things differently to improve the staff engagement?

The list can be as short or long as a business needs. The measures are specific to that business. The targets are specific to that business.

The trick is making sure that the business is actually doing that measurement.

How do you measure your business’ performance?

Photo: The bridge



Category: HR and recruitment, Leadership, Relationships, Self- development

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The Author:

Budding entrepeneur working on software product solutions for business. My background is mainly operational and senior management roles in mobile telecoms and software houses. Areas of expertise include professional services, out-sourcing, team management and general operations management. I've made the conscious decision to create my own company having spent the last 20 years learning in the corporate world. In my contributions to this forum, I will share some insights and learnings that I've picked up along the way and hopefully they will be useful to some or all! http://www.myprojecttracker.com

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  • http://twitter.com/fredchannel Fred

    Good post Barney.
    I guess many companies will argue that these are times to focus on the cash rather than what you mentioned above. Many would understand later that workforce impacts that cash.
    A few months ago we decided to spend less time on the road and meetings and instead, invested that time with our existing customers, delivering more value, pursuing a Purple Cow http://bit.ly/d333t8 As a result, the top three metrics that you mentioned were impacted very positively.

  • http://twitter.com/AjevaCom Ajeva

    Thanks Barney for pointing out these four things to measure in doing business. Now, the only challenge I see here is how to apply what you wrote in measuring my business performance as I’m doing it purely online through various social media channels. Is it enough to rely on what people say about your brand online? Still, I think that quality and trust are the two things that matter most.

  • http://www.ivanwalsh.com Ivan Walsh

    Hi Barney,

    I try to look at the metrics that I prefer to avoid :)

    I guess it’s human nature to want to feel comfortable and look at things that flatter us or make things look that bit rosier than they are.

    Someone suggested to look at the metrics/stats that you leave to last and focus on those instead.

    I guess it’s one way to see one’s blind spots and avoid going in circles.

  • Nialldevitt

    Nice one Barney! Coming from sales, it always amazes me how little we attempt to measure in business. I’ve had running battles with marketing departments in particular over this down through the years :)

  • Anonymous

    Great post Barney. I recall reading that a happy and motivated staff will resulted in satisfied customers. I concur with Fred’s view that the tendency is to focus on the cash – classic short term over long term.

    I’ve worked in companies where employee satisfaction is measured, and in companies where it has not been. For me the important thing is to take action based on what the measurement tells you.

  • http://blog.myprojecttracker.com Barney Austen

    Hi Frank. Thanks for the comment. Agree with you on the taking action on what the measurement says is key – otherwise what’s the point in measuring it in the first place :)

  • http://blog.myprojecttracker.com Barney Austen

    I hear you. It’s a problem in many different departments – the excuse is often given “we don’t konw how to measure X” – that is just an excuse though. There is always a measure

  • http://blog.myprojecttracker.com Barney Austen

    Good man Ivan – at least you attempt to look at the metrics that might not be as shiny as you might like :) . You are right though – by having measure, it’s you will see where the gaps are. Thanks for the comment.

  • http://blog.myprojecttracker.com Barney Austen

    Hi. Interesting challenge. If you are conducting all of your business development through social media – how are you measuring that success (or otherwise?). Perhaps that is a good place to start. Google analytics can help along with customised measurement tools.

  • http://www.biznetcentral.com John Wheeler

    Barney,

    Great Post! I spent 15 years as a corporate controller and a BI (Business Intelligence) Expert. You’re right. We used to say, “whatever gets measured, gets managed.” So I measured everything and worked for corporations that made incredible money.

    John

  • http://blog.myprojecttracker.com Barney Austen

    Hi John. Thanks for the comment. It does make a big difference working in a place that manages what they measure! It can be very frustrating working in a place that tries to do one without the other. It just doesn’t work.

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  • http://www.scm-operations.com Supply Chain Guy

    I use common performance measurement like you mentioned above. But I think we shouldn’t try to focus too much on one particular metric. Maximize profit but poor employee satisfaction is not something sustainable. 

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