Have you considered what really are the drivers for your business success?  One measure includes KPI analysis.

KPI = key performance indicators. These are metrics that you can use to assess the effectiveness and efficiency of your enterprise. They help you focus on the important aspects of your business and can give you benchmarks for continuing improvement. Many others have written about, link here, KPI’s and I encourage you to explore this subject further.

Let’s look at a few examples:

– a call centre: average time for % resolution of callers’ issues
– a food manufacturer: conversion ratio of the raw materials into finished goods (volume and not $)
– a professional services firm: count of new leads each week based on client visits or average time to convert chargeable time into cash receipts

KPI’s are usually not just accounting metrics such as gross margin and profitability. These accounting items are important; although they are generally outcomes of a well defined strategic plan and measurement of KPI’s.

The process of identifying the relevant KPI’s are specific to a firm and are based on
– firm specific strategy
– stage of development (start up through maturity) of the enterprise
– competitive environment

The process to identify KPI’s can often be a great tool to help an enterprise and its team focus on its strategy and mission statement.

Learn, consider, apply!