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Out of Control?

Posted On - 12/02/2016 09:03:09

How do you run a business? What do you do? What do you look at? How do you know when it's running well and not?How do you run a business? What do you do? What do you look at? How do you know when it's running well and not? What are the indicators? In management speak: the KPI's?

There are dozens, if not hundreds, of ways to gauge how a business is doing. The question is: which are the few that really matter? What are the true vital signs of a healthy business? And how do you measure them?

That's what this series – based on the 2015 Open Day session "Better Business" – is all about.

Heart rate

So how are you? Well? Got a cold? Fit? Overweight? Something else? Because a business is just the same. It can be fighting fit. It can be out of shape. It can catch a cold. And it can look well, but actually be sick. All can seem OK, but underneath there's a condition. Something that means there's illness coming.

The question is: how do you tell? If you were a ‘business doctor', what would be the ‘pulse' you looked for? And how would you check it?

Blood pressure

We started the Open Day session "Better Business" with a question: "How's business?" And we got all sorts of replies from "pretty good" through to "tough". But, being honest, we weren't actually interested what was said – we asked so we could follow up with: "What makes you say that?" We wanted to know the signs – the evidence – people use. We were interested in the vital signs they looked for.

The first three answers shouted were "PROFIT!" Others, like "new customers", "cash-flow" and "job satisfaction" got mentioned. They're not daft answers - like we said before there are loads of ways to measure how things are. But the point is this: hands-down, our experience shows money's the prevalent measure of performance. Well of course it is! Obvious isn't it? ...is it?

Body temperature

Why are you in business? Why? What's the purpose of it all? You're doing it for something so cough-up, what is it?

Maybe it's a hobby you can make a living off. Maybe you're out to build a chain of ‘offices' around your part of the country. Maybe you're out to get rich. Maybe it's something else. None of these is any better than the other. What's right is what's right for you. Genuinely, it is.

But, make no mistake; business – that is a commercial enterprise that endures – does have a purpose. No matter how big or small you are now or want to be, there's something you must do. And it's the same for all of you! Do you know what it is? Follow this series to find out.

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