The Importance of Key Business Performance Indicators to Small Business Management

How do you know how well your small business is doing? Do you look at profit? Do you look at your sales numbers? Do you measure growth?

Most businesses use monthly financial statements, which include sales revenues. Some compare those monthly results to the plan and/or to the previous year's results. All business should continue to use that information to manage their business. However, all small businesses should also include more significant key performance indicators as part of their measurement process. As a small business owner, managing-by-measuring performance is a significant key to your success.

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Develop a set of key performance indicators (KPIs) to track your business growth and success. These measures will keep you focused on your business goals. When you write your business plan make sure that you include measurable goals and objectives. Then set in place a system that will provide you with regular indications of performance.

KPIs can be easily developed and monitored however each business needs to customize the measurement process to their own business needs.

Here are just a few KPIs you can consider for your business:

• Number of orders in a day/week/month/year
• Number of estimates in a day/week/month/year
• What kind of 'win' ratio does your business enjoy (e.g. do you 'win' 15% of all estimates - track this data)?
• How long does it take for you to respond to customer queries: estimate turn-around times; order processing; time from order placement to order delivery; responsiveness in handling customer complaints; and so on?
• How often do you hit your 'promise' date (i.e. the date you promised to deliver the order to your customer)? Analyze the 'misses': ship dates you don't make. Are they with one product line? Or with one customer or type of customer? Or with one employee?
• What kind of employee turn-over rate do you have?
• What kind of customer turn-over rate do you have?
• Percentage of business your largest customer holds?
• Sales by customer
• Sales by customer by product
• Sales by product

These would be in addition to your regular monthly financials but consider KPIs more of a daily or weekly measurement. Set up KPIs to help you see what is going on in your business presently and to help you forecast the near term (this week, this month, next month). If you track some of these statistics daily you will begin to develop trend lines that will highlight both the positives and negatives of your business growth.

Once you start to collect the data, it becomes much easier to see where the problem lies. If you are a manufacturer and you are always late delivering to your largest customer, find out why. Analyze your process. If you are a distributor and you are always late delivering a certain product, find out why. Is your supplier always late? Do you need to carry more inventory of that item? Or in both these examples is it because your employee turn-over is particularly high in the shipping department? Why is turn-over in shipping high? Are you hiring the right people? Are you under-paying? Does your shipping supervisor have weak people skills?

Developing good performance indicators will help you identify and solve issues quickly. Once you have developed KPIs that are aligned with your business goals, and once you track your performance regularly, you will be in a better position to manage your business.

The Importance of Key Business Performance Indicators to Small Business Management

For more small business strategies and other small business resources go to http://www.more-for-small-business.com/ Kris Bovay is the owner of Voice Marketing Inc, a business and marketing services company. Kris has 25 years of experience in leading large, medium and small businesses. Copyright 2008 Voice Marketing Inc.

The Importance of Corporate Strategy

Let's talk about strategy. A lot of companies that we work with spend too much time focusing on tactics and execution and not enough time really determining what their overall strategy is as a business and the impact on spending enough time at the strategic level can really have an stunting impact on a company's overall ability to accelerate its sales, gain market leadership, and really power up its revenue growth. A lot of CEO's get bored when it comes to spending time on strategy and they view strategic work as being theoretical or hypothetical exercise that doesn't add a lot of value to a company. But when you look a little bit more deeply, companies that execute really well usually start by having a strong foundation in their strategic objectives and their strategic plans.

Many companies that do well in strategic planning actually formalize this process and conduct it on a periodic basis and make sure that their strategy is updated and aligned with changes in the market, changes that are going on with their competitors, changes that are going on with their customers in terms of specific needs, preferences, and overall requirements. So, a company that does good work on strategy has a much better change at being successful than a company that neglects this important area. Strategy is all about setting the foundation for understanding how to be successful in a market and how to win.

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Companies that have a good go to market strategy or strategic marketing plan are in a much better position to execute, according to a company's overall vision and to leadership's overall vision, than companies that don't. It's the job of leadership to provide this vision and set the framework for building a go to market strategy that can allow the company to be successful in its target markets and achieve its revenue and profit objectives over time. Strategy is also important in terms of being able to align the different elements of a business together and make sure that all of the people in your organization clearly understand where the company is going and what's required in order to get there as well as what role they will play in executing the company's overall successful strategy.

When leaders don't spend sufficient time defining their go to market strategy, often times the company suffers and resources are wasted. Members of the team don't understand what exactly it is they are trying to accomplish. Resources are wasted as sales people hunt for opportunities that don't fit with the company's core strategic objectives. And in general, a company that doesn't have alignment on strategy, is under-optimized and wasting time and effort on needless things that don't contribute to the company's overall bottom line success and leadership in the market.

It's the responsibility of a company's leadership to set the overall strategic direction for the company and make sure that they are keepers of strategy as the company moves forward and evolves. Second of all, to set that and to develop it as a vision for the company that can be projected and communicated outwards to its market place as well as internally with its employees. Good leaders plan. Good leaders have a strong focus on what the company's strategic direction is and work to align all of the companies constituents, including internal employees, as well as clients, business partners, channel partners, etc. with the company's overall strategy.

The Importance of Corporate Strategy

Cube Management helps companies accelerate their sales, by providing the Sales & Marketing talent they need to grow their business. Cube is a leading recruiting and consulting partner to mid-market and emerging growth companies in the technology, manufacturing, healthcare and business service sectors. We work across the spectrum of Sales, Marketing and Business Development, providing holistic solutions that drive revenue and profit success. Cube Management combines Strategy, Process and People, to produce great results. Download the Cube Management Recruiting Guide and the Cube Management Inside Sales Guide.

Importance of Business Communication

We all understand and appreciate the importance of communication in our day to day lives. A breakdown in communication between two people can result in some tumultuous times for them. This is the reason why communication is all the more necessary for conducting business in an efficient manner, because it involves not just two, but numerous people who may be located anywhere on the globe. Read on to find more about the importance of business communication.

The Best way to Communicate
Good communication means that the message that you wish to send is received by the intended recipients without being distorted in any manner. This is the reason why verbal communication is supposedly the best form of communication there can be. This is because there is very low possibility of distortions and there is instant feedback to be received. But in the context of business this is not always possible chiefly because of the 'one to many' nature of business communication.

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How Business Communication works
So most business communication is of a non-verbal type and can be anything from e-mails, letters, circulars, notices or memos.

The use of these methods lays even more emphasis on the importance of business communication. This is because there are no spoken words or feedback and body language to fall back on. So if the message lacks clarity then it may result in various incorrect assumptions being made by the recipients.

This requires all written communication to be concise and accurately worded. The sentences need to be examined for any unintended double entrendes. You must remember that a confusing message may result in an unfavorable response from your intended audience.

But the modern tools of business communication can also work in your favor. They can be a universal mode of non-personalized communication that you can look to use throughout your business set-up. They can help maintain an impersonal and formal tone and thus promote the concepts of equality and uniformity in your organization.

Cross-cultural Communication
The importance of business communication cannot be ignored in today's global business environment. Technological advances have made the world a smaller place and turned cross-cultural communication into an important dimension of any business. So it's best to learn something about the different ethnic groups that you may want to communicate with. This is because nuances can make a big difference to the way that people perceive your message.

This is true for both verbal and non verbal forms of communication. So you should look to avoid stereotyping and be open to new ideas on how best to communicate with various groups of people.

Barriers to Communication
The final aspect of business communication that needs a bit of discussion is the barriers that may arise in communication. Sometimes you may find out that despite your best efforts, you just can get the message across! While the content of your message may be perfect, some barriers may be at work here. They can be anything from barriers of language, perception, gender, familiarity or even emotions. You may need to find a way around them in order to be successful in sharing your idea.

All said and done, you may have realized the importance of business communication and some of its dimensions by now. Just remember to keep it simple and your business communication will speak for itself!

Importance of Business Communication

Simon Johnnson is the director of content for Executive Gift Shoppe. They specialize in business card holders and wallets.