How to Evaluate Your Business Performance Accurately and Efficiently
How to evaluate your business performance
Running a company can be demanding and exhilarating, but how can you tell whether your efforts are bringing in wealth? Learn how to evaluate your business performance.
Measuring your performance in real time is vital to your corporate health. Every company has a varying performance over time. Sometimes you can work your socks off and feel like you’re standing still. At other times it appears that very little effort on your part brings great results.
So how do you monitor your performance? What markers are there for measuring corporate success, and what are the warning signs of trouble to come?
Learn how to evaluate your business performance
No. of customers
Knowing how many customers you’ve got is an obvious way of assessing performance. If you’ve got queues at the door for your products then you’re clearly doing something right.
But this is an easy mistake to make. There could be any number of reasons why you’ve got loads of customers.
You may be selling your goods too cheaply.
You may be meeting demand for a short-term fashion that will have evaporated next week.
Having a lot of customers could actually suggest you’re in a dangerous boom-and-bust situation. Ask yourself whether these customers are symptoms of your company’s health or masking a problem.
Staff numbers are vital to consider as well. If your staff payroll is increasing to meet demand, that’s generally seen as a good thing. If you’re letting people go because you can’t pay them, you may well have problems. But is a declining turnover the only reason you’re losing staff?
Ask yourself if your staff are happy and productive. Are they enthusiastic about their work and proud to be part of your company? If they keep leaving to work elsewhere, maybe your business isn’t as healthy as it seems. If they’re taking a pay cut to move, you need to look very carefully at your business ethic indeed.
If your performance is down, it might be time to revisit your business plan.
The role of your marketing team
What are your marketing team aiming to do with their budget and what are they achieving? Maybe your marketing team is chiefly focusing on name recognition. This can be very important, particularly for service companies, but if they need to raise your profile, is that because of a previous failing?
Is name recognition your priority? Many companies need to be less concerned about their name and more worried about the product and its quality.
The marketing team can also deal with faults and queries. So if they’re piling resources into dealing with product problems, your brand image will be taking a knock.
Clearly if you’re having trouble winning contracts and investment, then no matter how well things are going in other areas there’s an image problem that needs to be rectified. This should become your priority.
Is your business delivering?
Brilliant products and first rate marketing is all very well, but are you delivering the products and services you’ve promised? It can seem like great business sense to have that ‘can do’ attitude.
Never turn down a contract, it’s all business after all and you’ve got to take it where it comes. But a crucial consideration is whether you can deliver on it.
One of the most embarrassing problems for business is when they underestimate their own popularity. Guaranteeing you’ll deliver a product in a given time frame, then getting so snowed under by orders you can’t hope to meet your commitments can be an absolute disaster.
A company that’s performing well will only take on business it knows it can meet. At the same time, this can create extra demand through desirability. Consider whether you’re meeting your promises or falling short.