Tag Archives | success

Why KPIs Are Important

You’ve probably heard the term KPI (short for Key Performance Indicator) thrown around before. You may have even considered using KPIs to manage your business. Before setting out on the path of developing and tracking your company’s KPIs, let’s first take a look at what KPIs are and why KPIs are important…

InvestopediaAccording to Investopedia, a KPI is simply,

A set of quantifiable measures that a company or industry uses to gauge or compare performance in terms of meeting their strategic and operational goals.

Sounds simple enough. But anyone who’s ever attempted to nail down their KPIs can tell you that determining what factors are really driving your business isn’t always straightforward. In fact, some companies spend months tracking metrics that turn out to have little or no impact on actual results. For advice on how to identify your KPIs, check out our KPI Discovery Cheatsheet.

Knowing that it may take some work, why should you take the time to determine the KPIs for your business? First, define what success looks like.

Define What Success Looks Like

Most likely, you have some idea what your goals are for the next year. The process of identifying and measuring KPIs forces you to look at what specific actions and behaviors will drive the company towards those goals.

For example, your goal is to increase EBITDA by 2%. When you work with your team, determine what factors are really driving EBITDA. Then, come up with some specific, actionable steps to achieve the goal.  There are many ways to improve EBITDA, but focusing on your company’s KPIs can help you develop your unique road map to success.

Focus Everyone on the Goal

It’s important to understand that KPIs need not all be company-wide metrics. But instead, it may focus on the operating efficiency of individual parts of the company which can then be related back to how those parts affect the whole. Developing and tracking departmental KPIs show how departments work together to achieve the company’s goals. They also show how individuals within each department can contribute to the company’s success. Tying everyone in the company to the same goal will provide a unity of purpose found in almost all successful companies.

What Gets Measured Gets Managed – Why KPIs are Important

Although there are many factors that drive success for a business, it’s difficult to know which factors are the most critical unless they are being tracked. If you aren’t looking at something, how can you tell if it improves or deteriorates? Determining key business drivers and tracking their progress will help ensure that nothing slips through the cracks.

To Encourage Accountability Using KPIs

Holding people accountable for results is tough. Unfortunately, if everyone thinks someone else is responsible then no one is truly responsible. Holding employees accountable for improving the KPIs under their control provides them (and their managers) with a yardstick to measure their performance.  Not only does the employee have a way to quantify how he or she has contributed, but managers can see which employees are contributing the most towards goals.

To provide an opportunity for small victories

Sometimes it’s tough to stay positive when goals are large and/or long-term in nature. Employees feel empowered to make a difference when they see the needle move, so breaking down the goal into its key drivers can give them the opportunity to achieve the goal in stages. Focusing on these “baby steps” along the way improves morale and keeps everyone focused on the prize.

What are some of the reasons you use KPIs?  Download the KPI Discovery Cheatsheet to start measuring your company’s KPIs today and leave us a comment and let us know your thoughts.

Why KPIs Are Important

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Why KPIs Are Important

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Success Is Your Business

See Also:
Emotional Intelligence in the Workplace
Are You Collecting the Data You Need to Run Your Business?
Five Reasons To Pay Attention To CRM Software
Warning Signs of a Company in Trouble
Working Capital Analysis

Success Is Your Business

I am going away from talking about traditional cash flow analysis this week. I was recently at a meeting with Larry Tyler of Metro Bank here is Houston. Larry was the guest speaker talking about how proper cash flow management can make a business successful. He then discussed how  business owners need to look beyond the financial numbers and look in the mirror to find out how their personal beliefs can affect the cash flow of their companies. Furthermore, Larry pointed out the reason business owners need to look in the mirror is that their personal values are going to make their businesses successful.

Success Philosophies

Larry was kind enough to put together that a business owner understand and believe some of the following points and philosophies that make success is your business a reality.

  1. Everybody in is a salesperson.
  2. Are you a salesperson in business, or are you a business owner making sales?
  3. You will not reach your potential as a sales professional until you answer the question, and answer it correctly! The Law of the Shareholder demands that you do.
  4. The Law of the Shareholder says that the most successful salespeople buy stock in themselves, they adopt a “CEO mindset” where they see themselves as a business owner making sales with a compelling vision to help people and they begin to stop thinking of themselves as an employee.
  5. The life of us lives in the life within the limits of our own thinking.

A Contract in Thinking

                           A Contrast in Thinking

Salesperson ThinkingCEO Thinking

Pays only for what can be reimbursed   Invest money to make money

Calls on anybody   Calls on the right body

Reacts to interruptions    Makes sure interruptions don’t occur

Keeps safe clients   Terminates unprofitable relationships
Is busy and action oriented   Is productive and results focused 
Thinks quantity is more important   Knows quality creates more quantity

Puts profits before people   Puts people before profits 

Puts revenue before reputation             Puts reputation before revenue

Builds business ahead of capacity   Builds capacity ahead of business 

Prioritizes schedules                      Schedules priorities

Is short-term oriented                     Is long-term oriented

Relies on quick turnaround                 Relies on clients’ trust

Succeeds by accident                       Succeeds by design

 

success is your business

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How To Train People For Success

See Also:
How to Run an Effective Meeting
How to Hire New Employees
Benefits of Advisory Boards
How to form an Advisory Board
Future of the Accounting Workforce

How to Train People for Success

How To Train People For Success: Training is about management preparing employees for success in their jobs and in their careers.

Employee Training For Success

Once a company has identified business strategies, jobs to be done, some measures of success, and the right people, make sure that employees have all the knowledge, skills, and abilities to succeed. Too many companies fail to make an investment in training and then wonder why employees under perform or even fail.

Some Important Best Practices For Training Employees

Make Sure It Is A Training Issue

Training is not always the best way to assure that your employees will succeed. If the job is designed poorly, or the manager has weak coaching skills, or the incumbent in the job has limited talent or work ethic, you usually don’t have a training problem. Make sure you have good people in well-designed jobs with solid, supportive managers before you invest in training.

Training As Strategy

Training is both expensive and time consuming. It is important to review training at the highest management levels. Then make sure that your investment is in the training with the highest chance for success and profit. Not all training needs are equal, and too often the “squeaky wheel” gets get training dollars that would be better spent elsewhere. A yearly training plan helps to solve this common problem.

Establish Training Objectives

When you identify an important training need, be sure to establish concrete, written goals. If you are providing training on new products, then determine exactly what information about each product that you want the employees to know. In addition, determine how they can use that information in their jobs. People can only learn so much in a limited time, so you need to plan carefully and develop the program to insure that the participants can use the right information.

Select The Best Trainer

There are many training providers out there, and it takes work to pick the right ones, those that can actually educate your employees to perform at a higher level. This is not the place to save a few dollars by selecting a cheaper, but less talented, trainer. Do research, talk to colleagues and competitors, go to trade organization events, and make it a management priority to find the best people. It won’t happen overnight, and it takes some effort, but you will be richly rewarded with training that makes your people better.

Reinforce The Training

Companies that do the best job of training people make sure that training is reinforced when the employee returns to the job. After all, you have invested hundreds or even thousands of dollars, so you thought it was important. Don’t let managers undermine your investment. This happens when you fail to discuss the training with the returning employee and not use/incorporate the new skills/knowledges into the job.

Integrate Training With Career Growth

We know that a primary reason good employees leave companies is that they believe that they are not growing in their career. One of the best ways to keep your best people is provide them with the chance to keep developing their skills. This does not mean training every year for every employee. Rather, it means using training in conjunction with recognition, rewards, and new opportunities to keep your best employees in your company.

And, A Few Tips About Training

1. Hire managers who are good at training their people.

2. Look for on-line training programs that employees can use by themselves.

3. Measure the results of training, every time.

In order to determine which candidates are the right fit for your company, download and access your free white paper, 5 Guiding Principles For Recruiting a Star-Quality Team.

How to train people for success

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Access your Recruiting Manual Execution Plan in SCFO Lab. The step-by-step plan recruit the best talent as well as avoid hiring duds.

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How to train people for success

External Resources

American Society for Training and Development (ASTD) Largest and most established source for information and materials about training.

Learnativity.com – website that contains articles and readings on adult learning, training, and evaluation. www.learnativity.com.

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Key to Success in Life

The past year has been challenging for all of us. Last night I was reading a book and a quote caught my attention. “Success in life comes not from holding a good hand, but in playing a poor hand well!”

This old saying comes from the poker table, however, it true in life and business as well. It is easy to keep your optimism when you are being dealt more good things in your life everyday versus bad events or challenges. How do you keep pushing on when each time the “cards” you receive are worse than before? Today, we’re looking at the keys to success.

Key to Success in Life

First, you have to keep in mind that not all of the “cards” you receive are bad. Some are quite good and very encouraging! It just seems that we are being dealt more bad than good. In order to persevere through the challenges start focusing on the positive things that are coming your way.

Second, look at what is not working and start making changes. Be honest with yourself and change your efforts that are not bearing fruit. We often keep doing what has worked in the past whether it is working today or not!

I don’t know about you, but today I am going to list the positive things that are working for me, look long and hard at what’s not working, and make changes!

To learn more financial leadership skills, download the free 7 Habits of Highly Effective CFOs.

keys to success

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Access your Flash Report Execution Plan in SCFO Lab. The step-by-step plan to manage your company before your financial statements are prepared.

Click here to access your Execution Plan. Not a Lab Member?

Click here to learn more about SCFO Labs

keys to success

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