How do you measure success within your small business?
Is it by how many clients you have? Perhaps it’s by how busy you are throughout the day. If you are like most small business owners, you measure your success by the amount of revenue that you bring in. According to Inc., in 2012 the most important measure of success for small business owners was revenue-based.
However, as Mike Michalowicz shows us in his book “The Pumpkin Plan,” it is not always money that determines the success of your business. In four years, his computer company had grown to almost one million dollars in revenue, but with high costs and no cash flow, he could hardly keep his head above water.
“Gross revenue means nothing,”
“when your receptionist makes more than you do.”
Entrepreneurs also can’t measure their business success by how correct their original plan was. While most small businesses do not have an Operations Manual, they usually have a scrap piece of paper (somewhere!) that has their basic business start-up ideas on how they are planning on rocking their industry. However, simply because you are unwavering in following your plan (from three years ago) does not mean company success.
As a Virtual Assistant, I coach clients on having well-defined business objectives and then teach them how to measure their performance against those objectives. As a side note, one way to do this is through SMART Goals, which will be discussed further in our article “The SMART Rules for Better Business“.
Here is a sneak-peak of two aspects – out of a list of many – that I help my clients use to realize the success of their business.
Are your customers satisfied with your services / products? Are you getting renewed business and / or referrals from current clients? Most entrepreneurs assume that as long as they get calls and purchases on a pretty frequent basis, that they must be doing something right. However, you truly need to completely understand your customers and be able to satisfy their needs to strengthen your business. I work with my clients to show them how to use Customer Satisfaction Surveys and Referral and Customer Care to their advantage against their competition.
Your staff is at the front-line of your business every single day, and if they are not completely satisfied in their jobs, your customers will see it through their actions (or lack thereof). Your customers and clients come to your business because of your product, but it is guaranteed to be your staff – their excellent customer service for example – that keeps them coming back. I recently joined a Chic Boxing class in my community and absolutely love going; the technique, class layout, and policies have all be developed by the owner of the company, but it is our instructor who makes me want to come back. She is part of the Chic Boxing front-line staff who clearly loves her job – her enthusiasm and encouraging attitude make the class pop with energy. The owner of the company chose the best instructors because she knew that they were the face of Chic Boxing. Without the best instructors, it is just another fitness class (which truthfully, there are a million of), and when your company is “just another,” there is no success without a creative edge.
Many small business owners are not sure how to measure their success. While the internet differs on what the true measure of success in small business is, it is agreed upon that your plan for success does actually need to be measured. As a Virtual Assistant, I will show you how to baseline your business, and then how to define and set out specific goals, properly measure your progress, and then review.
Do you have any ideas or a formula for measuring business success?