This week I met with my management teams to measure our brands’ performances and evaluate our strategies.
Once again, I realised the importance of measurement. It does not always seem to be the priority thing to do, but it is so significant in guiding your strategy and planning. If you do not measure your performance, how will you know whether something is working or not, whether your product is selling as expected or what your cost of doing business is? How will you be able to grow?
More than just understanding the performance of your company and brands, thorough measurement will also enable you to identify trends. It will put you in a better position to be proactive in managing future risks and challenges.
Measurement is of course not always that easy. While financials and figures can be shown on paper, some parts of your business can be quite hard to measure. How successful is your marketing department in establishing your brand in the minds of consumers as the number one product in its category? This is not easy to measure!
You have to identify the KPI’s (key performance indicators) to establish what is quantifiable and will allow you to measure the performance of your company.
Measurement is however about more than the financial reports and success lies in more than just the profit margin. In the hospitality industry, for instance, service is so important, but it is not easy to measure it against a bottom-line . In this instance, a system should be in place measuring complaints, return-business, compliments, etc. A well-managed system is crucial to enabling proper measurement.
Once you have measured, you can evaluate your performance and set new goals and targets. You can identify the obstacles and risks and find solutions.
And in the end, compiling a strategy and setting targets based on a measured performance will make it easy for management and staff to understand. It will also give your company a sense of direction.
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