A lot of small and medium business owners have a hard time tracking numbers in their businesses. They can be easily stumped with questions about how much money a business made today, yesterday, how many customers they had and how many leads did not turn into customers.
Do you have a problem in your business? Identify the key numbers around the problem and start measuring them. For example, if customer complaints are an issue for you, you should figure out the reason why complaints occur, remove the reason, create a script for dealing with complaints and then measure the number of unhappy customers on a regular basis.
If this number starts going down after you take action, it means that whatever you are doing is working.
This is where business intelligence comes to help. Business intelligence is a process of collecting data and presenting it in the form of actionable information to help a business owner make more informed business decisions.
“Where performance is measured, performance improves” (Thomas S. Monson).
Measuring and keeping track of numbers is the only reliable way to manage a business. First, you need to set goals. Second, you need to create a plan of action to reach your business goals. Implementation comes third. Finally, you need to be constantly measuring what is going on in your business to make sure that you are on track to achieving your goal. Business intelligence and analytics are an integral part of this last step.
What data should you collect? Here are a few key indicators:
- Revenue – daily, monthly, annual
- Number of Customers
- Average Transaction Value
It is recommended that no more than twenty numbers be monitored on a regular basis. If you find out that you need to keep an eye on more than twenty numbers, it’s time to delegate some your responsibilities to someone else and have them be in charge of some of the metrics.
A car’s dashboard is a great analogy how a well-set business intelligence dashboard should look like. You want to be able to quickly glance at the numbers and know where you are. Include too many elements on the dashboard and it becomes very hard to pay attention to them. Include too few and it’s impossible to know what is going on.
All the stats that you measure should be linked to your success. They should cover all dimensions of time (the past, present and future) and include all entities involved – your customers, employees, financial performance, operational performance and product/service quality.