Part 1: Make sure you’re collecting the right stuff
In my experience from working with hundreds of businesses, small business owners fall into two main camps regarding information and the use of it: those who don’t keep information systematically and those that do – however leave it lying fallow in a mass of spreadsheets.
Unless you’re one of the rarities, there’s another camp I’d like to introduce to you and persuade you to join: those who keep information systemically, analyse it, and use it to make key decisions about their business.
The overall purpose is to ensure the fundamental elements of your business (marketing, sales, operations, finance and new product development) are working properly and to spot trends that will allow you to focus your precious efforts where they’ll have the most impact.
Let’s start with identifying the kinds of data you need to collect. Some examples:
- Response rates on marketing campaigns
- Hit rates on your website
- Customer information: products/services bought, when, and what value
- Source of customers (referrals/campaigns/lead sources/networking etc)
- Aged Debtors
- On time delivery performance
- Customer satisfaction surveys
None of this is revolutionary. However, the test is whether you are able to review the measures relevant to your business on a daily, weekly or monthly basis (without having to spend hours digging it out) – and make decisions about how you are running your business.
If you’re not able to put your hands on key metrics with ease, I’d strongly recommend you review the systems in your business that you’re using for marketing support, sales tracking, website monitoring, finances and the operational aspects of your business.
Spreadsheets are more than adequate to get most businesses started – however they become a problem as more people come on board and develop their own variants of the sheets. The result is either you stop collecting data as it’s too much hassle, or it goes into a hole and its full value is lost.
1. Think through the most important pieces of information you need to know to establish whether the different pieces of your business are on track and what the key trends are
2. Review how you are currently collecting this information – is it mainly manual and hard work or fully automated?
3. How easy is it to analyse the information in a way that is useful to you to make decisions? For instance some accounting and CRM packages will collect all the data and produce standard reports – but are very inflexible when it comes to doing additional reports
My next article will focus on simple ways to analyse your information in order to drive results for your business.