Measuring business performance in real-time
One of the most widely-known and influential thinkers on management, Peter Drucker, once said, “if it cannot be measured, it cannot be managed.”
Measuring a business’s performance allows leadership to identify and correct any deviation from the company vision; it boosts accountability and helps management make realistic plans for the future.
However, focusing resources and time on setting business goals and key metrics is just the start.
When defining the metrics, we recommend asking the following question: do we have the necessary structures to measure our performance effectively and in real-time? And if we don’t, what are the key enablers we should focus our attention on?
Make objectives palpable by breaking them down into clear OKRs
Defining a clear vision and setting goals for the entire company is a challenging task but vital because it ensures that all the employees are on the same page.
The challenge is making the main goals over-arching but achievable, broad but tangible, and powerful enough to unite teams and motivate them to work collaboratively, rather than obstructively competing against each other.
The key in designing these complex business goals is to break them down into day-to-day Objectives and Key Results (OKRs) that are SMART (specific, measurable, achievable, relevant and time-bound). This will help align the objectives to company goals and break them down into concrete outcomes so that individuals and teams are actively working towards business objectives in their day-to-day.
Imagine the following situation: one of the critical business objectives for the year is to ‘put the customers at the centre of what we do’, but how can you turn this into measurable OKRs?
The answer is transforming this objective into key results that could include:
- 40% of customers renew or extend their contracts,
- 100% of customers complete satisfaction surveys,
- Increase average customer NPS by 15,
- 95% SLAs are met,
- 0 customers end their contracts early.
Get your employees on board and focused on outcomes
Many underestimate the value of defining a common message across the business. Sharing that vision of what the company wants to achieve generates a feeling of belonging and fosters a collaborative work environment. This motivates people, a factor that impacts employee retention and attrition. Highly motivated employees that work towards a common goal are more effective, which translates into customer satisfaction and, consequently, increased revenues.
However, the challenge is not only developing a strong employee culture but also focusing it on outcomes. Getting employees aligned and working towards shared goals is hard to quantify unless leadership regularly tracks key results that give a real-time view of how close employees, as individuals and teams, are to reaching their objectives.
Develop the tools that give an accurate real-time status
Having a clear image of the status of a business in real-time is vital for any leadership team, but how do you achieve that?
Instead of jumping directly to developing and implementing new and costly tools, companies should start by dedicating time to two activities:
- Don’t reinvent the wheel - use purpose-built software to make OKR tracking easier.
- Automate the most critical processes whenever possible while developing a timeline to automate the rest.
As far as integrating purpose-built software into your business goes, many believe this might disrupt the business’s daily operations, but that doesn’t have to be the case. Intuitive solutions such as Gtmhub’s OKR platform are versatile tools that help you set the right OKRs or optimise existing ones and track them in real-time. Such solutions, built to integrate seamlessly in your day-to-day business, will help reallocate valuable resources to more important projects and provide the necessary information to help you make informed business decisions.
Effectively measuring a business’s key performance indicators is not an easy task. Still, one thing is clear: no matter the size and resources of the company, the first step to correctly evaluating your performance is always the same - start by understanding what you want to measure and look at what’s holding you back from doing this.
Then get your employees on the right track by defining and promoting a shared vision that will give them a sense of unity and break down the critical objectives into day-to-day OKRs they can work on and track.
And finally, develop the tools that will give you a real-time status of the company and the necessary structures that will enable your leadership team to understand where you are to help you get to where you want to be.
The Cornerstone Advisory is a bronze partner with Gtmhub.
