Most entrepreneurs are flying blind – running their businesses on vague sensations, feelings and emotions, rather than data. During a week in which a company wins a big order, gets some positive feedback from a key client, and finally finds the right person to fill a key seat – the company’s owner(s) feel as though they run the very best business in the world. The following week, when the company loses a big sale, gets negative feedback from a client and has to deal with a few people issues – the owner(s) feel as though they run the most troubled company out there.
In both cases, they’re typically wrong. That’s where a strong data component comes in. To break through that manic cycle of highs and lows, you need to do a better job of running your business on data.
- The first step is building a great leadership team scorecard – 5 to 15 weekly numbers that give you an absolute pulse on your business. By looking at 12 to 13 weeks of those numbers at a glance, you’ll start to see patterns and trends develop that tell you whether or not those one-time events – like winning and losing business – is really something worth reacting to.
- Step two is using that same discipline at the departmental level. Is there a handful of weekly numbers that will give you an absolute pulse on your Marketing and Sales efforts? What about Operations? Accounting and Finance? Those departmental scorecards are valuable because they provide the leader of each department with leading indicators that provide insight which leads to informed action.
- The third step is making sure everyone in the organization has a number – one, two or three “measurables”, tied to departmental and leadership team scorecards, that they’re responsible for keeping on track each week. That connects each employee to specific actions that help the company achieve its Vision. It helps employees “self-manage” and proactively seek help from their supervisors when they veer off track. That’s what makes everything more peaceful, more profitable and, ultimately, more fun.
If you’re flying blind – consider taking those three steps to strengthen your data component. And if your efforts to build a great company or departmental scorecard have left you – look for ideas and tips in next week’s post.
