How do I know we’re making progress? Creating a more profitable business

No great business stands still for long – and if you do, you’re likely to end up on ‘life support’, coasting through and failing to grow or make profits.

The businesses that scale up successfully (and make the best profits) and those that understand the importance of moving forward, making changes and always looking for the efficiencies that will deliver a more streamlined and profitable business model.

And, as we’ve highlighted already in this short series of blogs, progress comes from asking yourself:

  1. Where am I now? – gaining an understanding of your company’s position as it stands at the moment and knowing if you’re winning, or losing, the business battle.
  1. What can I do to make things better? – coming up with new ideas and looking for efficiencies, whether it’s better financial management or more productive ways to ideate and execute new changes.
  1. How do I know I’m making progress? – tracking how well your improvements are progressing and putting real drive behind the evolution and execution of your new business ideas.

In this this final blog in the series, we’re looking at that final point – how you measure and push the progress and execution of your profit and efficiency improvements.

Aligning your priorities with what your people do

Ultimately, your team will be the people executing most of your profit improvement changes and process efficiencies. So it’s vital that your workforce has a clear idea of what they should be doing, and how it fits into the bigger picture.

Every owner of a business thinks their people are mind readers – but that’s obviously wrong. So good communication and clear direction are essential

  • You want the direction and priorities of the business to be 100% transparent.
  • You want to keep your people productive, busy and working towards these shared priorities.

A way to achieve this is by using one of the many cloud-based workflow and project management systems that are now available – and getting all the key benefits of working online.

One of the best cloud systems we’ve seen is aligntoday, a system where the core goal is to help you align your strategy and priorities across the whole business.

  • Effectively track your priorities – and get real-time reports on your progress against key performance indicators (KPIs)
  • A paperless, one-page plan – a one-stop, online plan that the whole team can view and refer to at any time, wherever they are.
  • A handy dashboard overview – personalised dashboard views of your progress, tailored for each role in the business.
  • Organized daily huddles – an easy way to prepare, manage and pull out ideas from your daily team huddles

A better way to execute your key actions

What you get with a system like aligntoday is a brilliantly clear overview of your business priorities – and how you’re performing against them.

Every person on the team knows what everyone else is working on and there’s real openness and transparency, as well as a shared feeling of purpose. And, ultimately, all of this helps the business to execute better, faster and more effectively.

And, as the owner or management team, you have so much more control over how your people are working (and where some work may be needed to keep the whole priority process on track).

  • You can see everyone’s progress with stop line charts – showing red, yellow or green, depending on performance.
  • You can see who’s doing what and where they need help – so you can be more effective at resolving any bugbears.
  • You have clear visibility of things that could stop the execution process – allowing you to fix them quickly.

The combination of a clear, direct leadership style, along with the functionality and benefits of cloud workflow software, gets everyone working together towards the company priorities.

It’s about meeting rhythms, along with software, to keep things moving. That’s the secret sauce of running a business – no-one talks about it, but it’s a vital condiment to add to your basic business menu.

Team scorecards and measuring performance 

Your team is such a key element in the quality of your execution. And every person having their own defined role within the bigger business structure is central to keeping the machinery running smoothly and delivering on your priorities.

When you take on a new employee, you’ll give them a job description – a list of what, in theory, their job is all about. HR is full of such job descriptions that are, mostly, of little use to you as a manager.

They give you a list of responsibilities, but they give you no measurements against those same responsibilities – in short, they don’t help you to know if this person is performing well, or badly.

To truly understand each team member’s role in the business, you have to:

  • Get rid of the minutae of the job description.
  • Focus on what the truly important things are that they do.
  • Find ways to track and measure those important elements.

Topgrading scorecards are one way to measure the performance of each role in the business – based on the Topgrading concept developed by Brad Smart

Topgrading starts by breaking down the talent and performance ability of your people into As (the top 10%), Bs (the top 20%) and Cs (the bottom 65%). The key aim is to make sure that everyone in the business is graded as an A, or to work towards that hypothetical ideal goal.

By looking at the main activities for each role, and logging what’s expected, you can set a performance standard and then measure how each employee tracks against that ideal over time.

Each person has their own scorecard, with a personal record of their performance over time, making it far easier to see where alignment is slipping, or where performance could be improved.

And it also helps to drive increased performance from the whole team and to keep them aligned with those all-important key priorities.

Progress with real drive behind it

By focusing on clearly profitable priorities – and using all the benefits of driven leadership, measured performance and software tools – you really can change the efficiency levels and long-term profitability of your business.

If you want to improve your profitability and performance management, please do come and talk to us – our Awesome 8 approach to profit improvement will help you realise the true potential of your business .

Get in touch with your local Holden Moss office to book in a session with one of the team – we’d love to help you meet your strategic and profit goals.

Written by

Steve Moss, CPA is a partner at Holden Moss CPAs and loves helping businesses and their owners grow to be the very best they can be. Our other offices include Raleigh, Oxford and Warrenton.

We are a little different at Holden Moss CPAs. While we still provide traditional tax and accounting services, years ago we realized many clients wanted help in running their businesses and were hungry for ideas, solutions, strategy, and execution. In response, we expanded our skill set and joined Ran One, a global network of business consulting firms. Our membership with Ran One gives us access to proprietary resources and analytical software to help our clients grow, become more profitable and valuable, and have the lifestyle they desire.

Now, blended into the fabric of our normal tax and accounting needs, we are focused on our clients’ businesses in a very different way. While our approach is not right for everyone, for those whom it is, incredible results may be obtained. Whether you have a new, or established, business, or for those in transition of selling or retiring, or for those who simply need to develop an exit strategy or succession plan, our unique approach to client service may be the edge you need.

No Comments Yet.

Leave a Reply

Message

< !-- {/literal} END JIVOSITE CODE -->