So that’s the 2013 business and financial plans finished! Looking forward with optimism for a very successful 2013, I assume that these have been communicated to all staff in the business and they are clear on the strategy and the mission.
But how do you know you are on-track? What do you do if the business is not on-track?
It is important for businesses to have some Key Performance Indicators (KPI’s) which will give an early indication that corrective action needs to be taken. These will be aligned to the strategy and mission of the business. For most business these will be a mixture of financial and non-financial measures. The importance of these cannot be ignored.
An example for a business which has high growth ambitions one of these should be the number of new clients gained.
Another example for a manufacturing Company, which has the objective to improve the quality of products and improve profit margins, would be to monitor and reduce wastage in the manufacturing process.
The list will be different for each business but they should be easy to extract and should be in addition to the monthly financial monitoring that any good business should undertake.
A business must always improve and run a critical eye over itself, where are the areas that it can move forward, where does its customers think it can improve, if the business are does not move forward it will be overtaken by its competitors!