Stop being frustrated with your profits by understanding the story behind the numbers. Too many business owners rely on “beer case metrics” to know how they are doing. Does this sound familiar? You work hard all week and on Friday you collect your customers’ cheques so you can run down to the bank to make a deposit. You then run back to the office, pay your suppliers and employees, and if you have enough money left over for a case of beer you must be doing OK. In other words, you don’t measure anything and the only way to know if you are doing OK is by watching the bank account.
It is crucial that you have timely information on how your business in doing so that you can take immediate corrective action to improve profits before losses mount. How do you do this? The answer is to measure Key Productivity Indicators (KPIs). By measuring productivity performance from the front lines of your business, you will have a much better understanding of what is driving the numbers on your financial statements. In this episode, Tony Malyk explains how a KPI system works by comparing it to the dashboard in your vehicle and gives advice on what to measure and how to set up a KPI system. Knowledge is power, so empower yourself with information so you can run a more profitable business.