Because of the economic crisis that the world is experiencing today, a lot of business have cut down on their manpower because they can no longer carry out their daily operations if they keep them. Some businesses have declared and filed bankruptcy and some even shut down. The business industry is a cutthroat industry. You are just as good as your last sale. A business has to consider first the safety of their finances to make sure that they can continue with their operations. Some business managers have acquired enough education for them to know how to administer their organization well.
To know whether your business is thriving or not, you can make use of the business performance indicators. A performance indicator is generally employed to aid or help an organization or a business classify and assess how successful it is, characteristically in line with their long term objectives. These performance indicators are not only applied to a profit organization but to a non profit organization as well like a hospital, etc.
These key performance indicators will now reflect the business or the organization goals and objectives. A business that wants to be the most profitable company in the entire industry will make use of a performance indicator that will gauge profit. Examples are Pre tax profit and Shareholder’s Equity. However, an educational institution will not be concerned about making money therefore it will use a Graduation Rate and Success in Finding Employment After Graduation as its performance indicator.
You have to make sure that your business performance indicators are quantifiable or can be measured. Make sure that you use the same indicator every year so that you can measure your improvement and compare them every year.
You also need to use an indicator that is useful in reaching your business’ optimum success. In other words, in selecting a business indicator you have to make sure to limit them to those factors only that are crucial to the business reaching its goals and objectives.
Here are just a few number of business performance indicator for you to consider for your business:
- Number of orders weekly or daily
- Number of estimates daily or weekly
- The kind of win ratio that your business is enjoying and make sure to track this data
- The length of time for you to answer your customers queries and questions
- Employee turnover rate
- Sales by customer
- Sales by customer by product
- Sale by product
- The frequency of you hitting your promised date
Business performance indicators are also called Key Performance Indicators or KPIs. KPIs can be easily made and monitored but every business has unique operations so they need to customize the measurement procedure for their own needs. These KPIs will let the entire management see the company or the department performance in one place, facilitate teamwork because a team can work together toward a common goal, is a fast way of viewing the factual and actual performance of a strategic goal, make the decision making process much faster and easier because there are visible measure to make use of.