In this blog series, Fitness Training for Businesses, I emphasize the need to focus on your whole business model to ensure long-term success. In Part I, I raised 5 concerns about measuring your business performance. With this post, I explore the first concern: how do you conduct qualitative analysis of your business?
How do you analyze the elements of your business that are essential to its overall health, yet defy easy measurement?
It’s impossible to measure all the activities that fall within your company’s overall business model. But it’s unwise for management to ignore important elements because they can’t be measured. The fact that something is difficult, or even impossible to measure, should in no way diminish how much effort you put into it. Or the discussions you have around it. Or the focus you put on planning and executing it well.
I challenge you to:
- Identify any items in your business model that defy measurement, but without which you cannot survive long term. If you as leader or CEO can’t think of them, ask those around you who are in support positions.
- Elevate the important supporting roles to a proverbial seat at the planning table.
- Consider non-measurable areas to be equally important to visible revenue generation activities. This is especially important when preparing budgets and allocating time and monetary resources.
- Recognize and reward individuals or teams that do great work behind the scenes. They often go unrecognized because little of what they do (or nothing!) can be measured on a graph.
Good examples of hard-to-measure elements in your business are the Human Resources department, the supplier management team, or the general administration team. If you want to give them purpose, help them understand why their work is important, and recognize them publicly.
And finally, please stop treating them as overhead and expense. They are so critical to your business achieving consistent success.
In Part III we will look at the second concern about measuring your business performance: the behind-the-scenes work that drives end results.