How to build the ultimate business dashboard for growth
Every business wants to drive growth. But like a long road trip, without instituting milestones to measure your progress, you risk going in circles.
The concept of key performing indicators (KPIs), is not new. Only recently it is catching on in smaller businesses, especially those on a growth trajectory. Well established KPIs can help direct business growth. To this end, invest time in getting it done right. Here’s a checklist to help you develop an effective set of KPIs.
1. Start with the end in mind
Cliche-ish as it may sound, it is overlooked by many smaller businesses. Your end, or strategy, is the destination. It is best captured in 1-page to avoid getting lost. In addition, an effective strategy is never without numbers. Here’s where your accountant has a part to play.
2. Know the questions to ask
Your KPI is a business dashboard that answers the questions leading to the big question: “are we there yet?”. Asking the right questions help you focus on identifying the right indicators to look at. After all, the right answers begin with the right questions.
3. Data source
What gets measured gets done! But if you can’t locate the data source, or can’t build it, go back to Item 2 above. Smaller businesses on a growth path tend to veer towards the ambitious side. Pragmatism reigns. Your accountant’s view of your business’ state of financial health is a great help.
4. Know when and how to measure KPIs
You don’t look at your gas tank every time you step into the car. And you don’t measure your gas tank based on how responsive the car is every time you step on the pedal. This same principle applies to KPIs. You must know when and how to measure them. KPIs are good business tools when they are used appropriately.
5. Share your KPIs
Unless you are a solo entrepreneur, it is important for others to know the business’ KPIs. When others take ownership of the relevant KPIs, they become motivating tools. To learn more about how KPIs can drive growth, contact Sydney Accounting today on 02 9810 3222.