This entry is part 2 of 6 in the series Business Pit Stop

CHAPTER ONE – CHECK YOUR DATA

 

Modern race cars are fitted with computers that generate a lot of data. Race engineers are constantly monitoring the telemetry during the race. They can see when the brakes are overheating before they reach a point of failure. They can tell the driver to adjust various settings on the car, or to back off from the driver in front just a bit to get out of their “dirty air.”

In business, you also need to monitor the data. I believe in tracking metrics on a daily basis. This allows you to account for the difference in the number of business days in a month, holidays or days you are closed.

• Track your numbers daily and keep your finger on the pulse of your business.

• Understand your critical business metrics, also known as key performance indicators (KPIs).

• What are your average daily sales? Number of orders? Phone calls? Are they above or below budget? Are they trending in the right direction?   (See examples at PitlaneStrategies.com/bonus)

• Budget your projected daily performance each month based on prior experience and anticipated growth.

• Identify which days of the week are slowest and implement promotions or adjust staff accordingly.

• Make sure you are accounting for changes due to holidays or slow business cycles.

• Explain any anomalies and isolate outliers to make sure your underlying trend is still in line with projections.

Although some business leaders don’t seem to care much about daily numbers, it can be a mistake to assume you can run your business on intuition. Typically, things don’t go suddenly wrong; there tends to be prior trends and patterns. You need to be tracking the data and looking diligently for these patterns, so you can take corrective action.

Next up:  Chapter Two – Check Your Strategy

Lindsley Medlin

Pitlane Strategies LLC

Copyright © 2018 by Lindsley D. Medlin, Jr.

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