As we head through the new year, now is a good time for businesses to review and assess their direction. Yet what is the best way to do this and how can you realistically review your business performance? We investigate five steps you can implement to help you review your performance and setting steps to improve.
1. Assess your expectations and goals
Before you even attempt to assess your business performance, you need to be clear on your goals and expectations. These aren’t just your typical business success-based goals. You have all of these areas included in your business plan.
It is assumed that most businesses want to grow in terms of revenue and size, however this isn’t the meaning of business success for all owners. For some, happiness is a key factor.
55% of small business owners are apparently satisfied with being a small business owner.
So before you crack on with measuring your success, be clear on what you want to achieve from your business and where you want to go in all areas.
2. Speak to your customers
Jeff Bezos’ main Amazon mantra is his focus on what his customers want and it’s not done him any harm when it’s come to business success and performance.
Customer satisfaction can be a key indicator on where your business is heading in the future – if your customers aren’t satisfied after buying from you, they probably won’t do it again.
There are a variety of ways you can measure the relationships with your customers.
This can be through surveys, reviews or simply monitoring their physical and verbal responses to your different products and services.
Customers don’t just provide you reactions to your previous business activity, they can also help you to improve your future products/services and help shape your vision for the future.
3. Review the market and how you fit in
Markets have been particularly volatile in recent years.
Staying in tune with how your market is doing can help be an indicator of your own success.
If you’re having a lull in profits it might not necessarily be down to your own personal performance, reviewing the market will help tell you if your competitors are also feeling the same pains.
4. Focus on your finances
This might seem obvious but businesses are generally about generating money and a lack of this is usually a clear indicator your business performance has taken a hit.
When you are generating more money this opens new opportunities, allowing you to recruit, grown and develop new services.
Reviewing your financial statements and how much money is going in and out of your business will help give you a picture on your performance.
Focus on your income, balance and cash flow.
Your income statements will measure profitability during certain time periods, whereas your balance sheets will help show your overall business financial health based on how much you own and owe.
Finally, monitoring your cash flow will show you how much liquid cash is in your business and what you’ve got to play with.
5. Look internally
Even if your business is performing monetarily, it’s important not to forget your employees. Without them and their buy-in, you can have difficult issues with staff retention.
When your staff all start to leave this can quickly lead to challenges with delivery and ultimately impact profit and performance.
One way to stay on top of what your employees are feeling is by conducting regular performance reviews.
This allows you to get an insight into how your employees are feeling, how effectively they’re doing their work and where they see areas for improvement that you might have missed.
As covered in our piece by Hakeem Ajonbadi, employee satisfaction is crucial.
Employee performance reviews can also help you see where there is too much or not enough resource in your business and allow you to re-allocate staffing to areas that really need it.
This will help improve the overall happiness of your business and its productivity.
Interested in reviewing your own business perfomance?
Find out how our free business analysis tool and 1-1 consultancy with business school academics can help you review your performance with assistance and put you on the right track quickly and effectively.