Categories: Business ModelsIdeasPodcast

Business Measures to help you stay on the right track

Business measures are crucial for helping you work out if you are on track, off track or you’ve completely lost track. In this article, we share seven things you might like to measure to ensure you’re focused and on the right track. (Plus you can listen to a podcast episode of this post if your prefer – link at bottom).

[Updated 01 March 2022 – Podcast link added]

Photo by charlesdeluvio on Unsplash

Business Measures to keep you on the right track

It’s perhaps no surprise that for weight loss, the keystone habit is often journaling. Simply writing down everything you eat starts to create awareness about what you are actually eating. What you measure matters because counting something requires a degree of focus.

One of the things that I’m great at is strategic planning. And, one of my weaknesses is that I often don’t translate this into day-to-day activity. One way that I’ve designed my work to cover this is to create some strategic goals for the year and then break them down into 4-week blocks and ultimately daily actions. For example, I set an income target for the year and then I know how much I need to earn each block, each week and each day to be on target. Likewise, I play a game where I count how many phone calls I make. I don’t naturally like the phone and by counting my calls I force myself to stay social and be in contact with people.

My question for you is:

What do you count and measure in your business?

Here are seven things that you might count in your business to inspire you to take the most effective action you can…

1 Money

Most businesses have a focus on their money. At the very least they count the money that’s coming in and going out of their business. One challenge around this is managing the flow of money so that you have enough to pay your bills when they are due. This includes putting the GST, VAT or sales tax aside to pay your tax bill when it is due.

One of the disadvantages of measuring your money is that most of us are not motivated by dollars. Sure, we all want it, and it’s not the driver or the reason that has take action. If this fits for you then you may want to measure the activity rather than the result. For instance, measure the phone calls you make plus the sales that are generated.

TIP: What things do you manage around your money? Consider measuring the activity that leads to making a sale as an additional thing to count.

2 Traffic

Following on my previous example, traffic on your website, your social media accounts and your email marketing (open rates) are all activities that potentially lead to sales. The great thing about your online activity is that you can track your numbers quickly and easily. The trick is to know which numbers matter the most. As a minimum, Google Analytics is crucial on your website because you can set online goals for your website and track responses to your blog posts and other campaigns.

Also, whilst I do check my website traffic, podcast traffic, email open rates etc, I’m not a slave to these results. My goal is to balance what I want to write about and what my audience likes me to write about.

TIP: Run regular tests on your website etc to find out which business measures matter the most for your particular situation.

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3 Output

What are you creating? For me, I have broken my year down into 13 blocks of 4 weeks. And, inside each block of 28 days I have committed to: publishing 28 blog posts (that’s one each day), presenting 4 times and creating 4 designs (that’s one each week). This is one way of measuring my output. Other things like my comments on social media I don’t measure.

TIP: What creative outputs are important to you? Do you measure them or simply play when you play?

4 Learning

If your output is what you create then your input is what you learn. So, what are you learning and how would you measure this? One way I do this is to record the books I read – my goal is read one book each week or 50 for the entire year. Believe it or not, I have a list of over 500 books that I’ve read over the past 12 years. Other ways to count your learning might include:

Courses you’ve completed
Workshops or seminars you’ve attended
The degree you’ve been awarded
The hours per day you spend practicing
How many other people you have taught

TIP: The big challenge around measuring learning is to focus either on your activity (such as the hours you practice) or your results (such as the degree you were awarded). Sometimes both works!

5 Contribution

How would you know if you were making any difference to the people you meet or the community you live in? One way to measure the difference we make is through the dollars we earn. And, this might not be the best measure either. One thing I count is the number of times I’ve helped someone or given a gift to someone. This might be to:

Answer a question in a forum or online group
Retweet or promote someone else’s post
Donate some money or goods to charity
Pay for someone else’s coffee
Listen to a friend who needs a hand

Clearly, this is subjective and I think this adds a neat spin on the things you can count in your business.

TIP: Consider counting quality as well as concrete actions. You might like to make a list of criteria or leave it completely open to interpretation and reflection.

6 People

This is a tricky one. As an individual I don’t want people to ‘count me’. I’d rather be treated as a person with cares, concerns and thoughts, not as a number. And, it’s important to ‘count people’ in your business to know where to focus your time, energy and attention. For example in your email marketing, open rates and link clicks highlight who your biggest fans are. Likewise, someone who pays you money for your products is clearly a customer as compared to someone who loiters on your list and will never buy from you now or in the future.

TIP: The trick to measuring people is to respect the individual and not pre-judge based on their behaviour. As much as we might be grateful for their fiscal contribution, a customer who pays you money is not a better human being than one that doesn’t.

7 Innovation

Measuring creativity sounds like an oxymoron. And, in my view it’s not. If innovation is the result of a series of experiments then we can count the number of successes and failures we have. Further, within any experiment it’s crucial to measure the results you are getting so you know if it’s working or not. In the Lean Startup model, they make the distinction between Vanity Metrics and the Three A’s of Actionable, Accessible and Auditable measures.

The Lean Startup Slideshow
The Lean Startup Review

TIP: Measuring the right things is the whole point of this article. Start by asking what is crucial and what is not. And, ensure you measure some of your activities as well as your results.

COMMENT: What are the things that you count in your business? And, what would you add to this list?