Pillar 1 - Measuring Your Performance
This lens covers the vital topic of how you measure your business performance and then use that information to improve your business profitability.
This is Pillar 1 in my Eight Pillars of Business Properity introduced in the How To Increase Business Profitability Squidoo lens.
This page includes an element of Finance for non-financial managers training because I want you to understand what the numbers mean.
Why Measuring Performance Is Essential
A few years ago in the UK there was concern about the large numbers of small businesses that were failing. This resulted in talk about changing the insolvency laws to encourage a rescue culture.
The idea was that businesses should seek turnaround management help earlier in their decline and the businesses would be then saved.
This would avoid all the knock-on difficulties bankrupt companies cause to their employees, suppliers, customers, providers of finance and the government.
Trial System
A trial of a special scheme was set up in the UK West Midlands where businesses in difficulty could have the services of a turnaround expert for a set number of days without paying a fee.
The scheme failed because a significant proportion of the businesses who applied for help had totally inadequate financial and performance information.
The reports that came out were a damning condemnation of management who were operating with little or no performance feedback. As the saying goes "If you don't measure it, you can't manage it."
Fundamental to any improvement effort is the principle that you must know where you are.
It is like being lost in your car and you stop to ask someone to help. If they know where you are and where you want to go they may be able to help but if they don't know where you are, they can't help.
The idea was that businesses should seek turnaround management help earlier in their decline and the businesses would be then saved.
This would avoid all the knock-on difficulties bankrupt companies cause to their employees, suppliers, customers, providers of finance and the government.
Trial System
A trial of a special scheme was set up in the UK West Midlands where businesses in difficulty could have the services of a turnaround expert for a set number of days without paying a fee.
The scheme failed because a significant proportion of the businesses who applied for help had totally inadequate financial and performance information.
The reports that came out were a damning condemnation of management who were operating with little or no performance feedback. As the saying goes "If you don't measure it, you can't manage it."
Fundamental to any improvement effort is the principle that you must know where you are.
It is like being lost in your car and you stop to ask someone to help. If they know where you are and where you want to go they may be able to help but if they don't know where you are, they can't help.
The Essential Measures You Must Know About Your Business
There are literally thousands of different things that people could measure in their business. Some go too far and overwhelm their managers with so much data that it loses its information value.
When I first left the accounting profession, I went to work for a company that distributed two binders of profit information for its directors and senior managers every month. As you can imagine, it was totally overwhelming.
Ideally you should have a one or two page performance report each month that you can study in detail and look at the trends. Graphs help reveal trends.
When I first left the accounting profession, I went to work for a company that distributed two binders of profit information for its directors and senior managers every month. As you can imagine, it was totally overwhelming.
Ideally you should have a one or two page performance report each month that you can study in detail and look at the trends. Graphs help reveal trends.
- Are you making a profit and if so, how much?
- Are you generating cash and if so, how much?
- What is the current bank balance and what is the headroom?
- What is your break even position and margin of safety?
- How much is your business worth?
- How healthy is your current order book and sales pipeline?
- Where do your leads come from and how much does it cost to generate a lead?
- What is happening with your key customers? Are they buying more or less?
- What do your key operational measures show?
- What do the trends for these key numbers reveal?
Recommended Books on Measuring Your Business Performance
Measuring Your Profit
The goal of every business is to create and satisfy customers at a profit so measuring your profit performance is fundamental to managing your business.
Small Changes Can Lead To Big Effects
By definition profit is the arithmetical difference between sales revenue and costs and the fundamental thing to understand is that you can't manage profit directly.
The only alternatives are:
1 - to increase revenue while holding costs the same
2 - to reduce costs while holding revenue constant
3 - to increase revenue faster than you increase costs
4 - to reduce costs faster than you reduce revenue
That's it - profit improvement on a beermat.
Here is the problem where the average profit is about 4 or 5% of sales value.
A small change in revenue or costs (for better or worse) will have a massive difference on your profit.
Monitor Your Profitability Regularly
Because of the complexities involved in allocating revenue and costs to periods, it is best to take professional advice (or employ professional accounts staff) to prepare accounting statements regularly and that usually means monthly.
My Preferred Solution
Proper accounts are prepared monthly based on the underlying transactions processed with weekly estimates showing the progress towards a forecast or target for the month based on information which comes through during the month.
The Key Criteria - Relevant, Reliable and Accurate.
Relevant information means that it shows what is happening to the important elements of your business.
Reliable information is prepared on a consistent basis so you want the same accounting policies and procedures applied each month.
Accurate information means that it tells you the true story of what has happened in your business. You want accounting information is that is accurate but it does not need to be precise.
The Format Of Your Monthly Management Accounts
The key words are "monthly management accounts" so this means information that is useful for you to know each month and which can be used to help you to manage your business.
You do not want a monthly version of your annual accounts which are prepared for the tax authorities and statutory reporting. Unfortunately that is what many firms of accountants will provide unless you specify your requirements in detail.
1 - Analysis of Sales
This can be by product category, by customer type (or even by customer), by region (or person) or a combination of them all.
Too often I see accounts with inadequate information provided about what how sales are performing when this is the source of all your profit.
2 - Your Direct Variable Costs of Sale
Direct means that their allocation is without dispute.
If you sell books, then this would be the cost of the books sold. If you sell steel components, then this includes the cost of the steel required to make the component including any scrap. If you sell cleaning services, this includes the cost of your cleaners' wages and social costs.
Variable means that the value changes with the volume of sales you make. So if you sell ten books, the cost is twice the cost of selling five books (assuming you don't cross a quantity discount threshold).
3 - Your Gross Profit, Gross Margin or Contribution
Sorry for the different terms but people use different terms for effectively the same measurement.
This is your sales value minus your direct variable costs.
This is an absolutely vital measure to understand because it is effectively your real income and I like to see it analysed across the same categories as you look at your sales although it can be technically challenging.
Let me try to explain why this is so important.
You may have three different types of product, each selling £20,000 per month.
Product A has a 30% profit margin so generates £6,000 contribution.
Product B has a 15% profit margin so generates £3,000 contribution.
Product C has a 50% profit margin so generates £10,000 contribution.
So if I ask you which is your most important product and the one you want your sales force to promote first, the answer is obviously Product C. It generates the highest profit and every extra £100 of sales generates the most profit.
But what if sales weren't equal?
What if product A has sales of £40,000 per month, product B had sales of £60,000 and product C has sales of £20,000.
Now which is your most important product?
Product B has the highest sales, Product A generates the highest contribution at £12k per month (Product B generates £10.5k and product C still generates £10k) and Product C has the highest margin %.
This is much closer to the real world where you are having to respond to opportunities but choose between them or decide how you are going to respond to threats.
Having your Gross Profit or Contribution reported by Product / Customer Type / Region means that you can understand what is happening in your business at a much deeper level and take the appropriate actions.
4 - Your Indirect Variable Costs
You may have other variable costs which very with output and sales but which can't be directly allocated to particular products or customers.
Some businesses will find that Labour, Carriage, Power and Consumables fall into this category and for some businesses it is OK to bundle them up and apportion the costs on some basis to the sales.
Other businesses are better to recognise that they need two product margins. The first after direct costs and the second after the indirect variable costs.
For example I used to work for a non ferrous metal supplier that identified a material margin (i.e. after only deducting direct material costs) and then a contribution (after allocating direct labour and variable production costs).
This may seem unnecessarily technical because what you should so will depend on characteristics of your business and the ability to account at the different levels.
The two big advantages are that it:
a) Reduces issues about the different methods of apportionment
b) It helps to break the margin into components so for example, in my non ferrous metals supplier we were able to tell the different impact of pricing from the production efficiencies. This increased accountability.
5 - Your Overheads / Fixed Costs
These are your fixed costs which are broadly the same for each accounting period unless you take deliberate action.
It includes if appropriate:
1 - Your production overheads
2 - Your distribution overheads
3 - Your sales overheads
4 - Your marketing overheads
5 - Your administrative overheads
6 - Your Operating Profit
This is the primary measure that you are trying to increase as this is the profit you generate from your business operations.
7 - Other Income>
You may also have other sources of income.
For example you may have properties that you rent to other people or you may have sold a property in the year.
I always like to see these items which are not linked directly to the business shown separately.
8 - Other Costs
You may also have one off other costs which need to be shown separately to make it easier to compare on month with another.
For example, you may have costs of employee lay-offs and redundancies which would distort performance if not highlighted in a separate category.
9 - Interest
This will reflect your financing policy and while it is an important cost, it is best to separate.
10 - Profit Before Tax
A convenient sub-total to show how much economic gain you have generated.
11 - Taxation
If only death and taxes are inevitable, you may still have some scope for reducing your tax payable or delaying payment.
Check with your accountant. A big advantage of preparing monthly accounts for profitable businesses is that it means tax planning can be done from a position of knowledge.
12 - Profit After Tax
The profit you keep within your business for the period.
Small Changes Can Lead To Big Effects
By definition profit is the arithmetical difference between sales revenue and costs and the fundamental thing to understand is that you can't manage profit directly.
The only alternatives are:
1 - to increase revenue while holding costs the same
2 - to reduce costs while holding revenue constant
3 - to increase revenue faster than you increase costs
4 - to reduce costs faster than you reduce revenue
That's it - profit improvement on a beermat.
Here is the problem where the average profit is about 4 or 5% of sales value.
A small change in revenue or costs (for better or worse) will have a massive difference on your profit.
Monitor Your Profitability Regularly
Because of the complexities involved in allocating revenue and costs to periods, it is best to take professional advice (or employ professional accounts staff) to prepare accounting statements regularly and that usually means monthly.
My Preferred Solution
Proper accounts are prepared monthly based on the underlying transactions processed with weekly estimates showing the progress towards a forecast or target for the month based on information which comes through during the month.
The Key Criteria - Relevant, Reliable and Accurate.
Relevant information means that it shows what is happening to the important elements of your business.
Reliable information is prepared on a consistent basis so you want the same accounting policies and procedures applied each month.
Accurate information means that it tells you the true story of what has happened in your business. You want accounting information is that is accurate but it does not need to be precise.
The Format Of Your Monthly Management Accounts
The key words are "monthly management accounts" so this means information that is useful for you to know each month and which can be used to help you to manage your business.
You do not want a monthly version of your annual accounts which are prepared for the tax authorities and statutory reporting. Unfortunately that is what many firms of accountants will provide unless you specify your requirements in detail.
1 - Analysis of Sales
This can be by product category, by customer type (or even by customer), by region (or person) or a combination of them all.
Too often I see accounts with inadequate information provided about what how sales are performing when this is the source of all your profit.
2 - Your Direct Variable Costs of Sale
Direct means that their allocation is without dispute.
If you sell books, then this would be the cost of the books sold. If you sell steel components, then this includes the cost of the steel required to make the component including any scrap. If you sell cleaning services, this includes the cost of your cleaners' wages and social costs.
Variable means that the value changes with the volume of sales you make. So if you sell ten books, the cost is twice the cost of selling five books (assuming you don't cross a quantity discount threshold).
3 - Your Gross Profit, Gross Margin or Contribution
Sorry for the different terms but people use different terms for effectively the same measurement.
This is your sales value minus your direct variable costs.
This is an absolutely vital measure to understand because it is effectively your real income and I like to see it analysed across the same categories as you look at your sales although it can be technically challenging.
Let me try to explain why this is so important.
You may have three different types of product, each selling £20,000 per month.
Product A has a 30% profit margin so generates £6,000 contribution.
Product B has a 15% profit margin so generates £3,000 contribution.
Product C has a 50% profit margin so generates £10,000 contribution.
So if I ask you which is your most important product and the one you want your sales force to promote first, the answer is obviously Product C. It generates the highest profit and every extra £100 of sales generates the most profit.
But what if sales weren't equal?
What if product A has sales of £40,000 per month, product B had sales of £60,000 and product C has sales of £20,000.
Now which is your most important product?
Product B has the highest sales, Product A generates the highest contribution at £12k per month (Product B generates £10.5k and product C still generates £10k) and Product C has the highest margin %.
This is much closer to the real world where you are having to respond to opportunities but choose between them or decide how you are going to respond to threats.
Having your Gross Profit or Contribution reported by Product / Customer Type / Region means that you can understand what is happening in your business at a much deeper level and take the appropriate actions.
4 - Your Indirect Variable Costs
You may have other variable costs which very with output and sales but which can't be directly allocated to particular products or customers.
Some businesses will find that Labour, Carriage, Power and Consumables fall into this category and for some businesses it is OK to bundle them up and apportion the costs on some basis to the sales.
Other businesses are better to recognise that they need two product margins. The first after direct costs and the second after the indirect variable costs.
For example I used to work for a non ferrous metal supplier that identified a material margin (i.e. after only deducting direct material costs) and then a contribution (after allocating direct labour and variable production costs).
This may seem unnecessarily technical because what you should so will depend on characteristics of your business and the ability to account at the different levels.
The two big advantages are that it:
a) Reduces issues about the different methods of apportionment
b) It helps to break the margin into components so for example, in my non ferrous metals supplier we were able to tell the different impact of pricing from the production efficiencies. This increased accountability.
5 - Your Overheads / Fixed Costs
These are your fixed costs which are broadly the same for each accounting period unless you take deliberate action.
It includes if appropriate:
1 - Your production overheads
2 - Your distribution overheads
3 - Your sales overheads
4 - Your marketing overheads
5 - Your administrative overheads
6 - Your Operating Profit
This is the primary measure that you are trying to increase as this is the profit you generate from your business operations.
7 - Other Income>
You may also have other sources of income.
For example you may have properties that you rent to other people or you may have sold a property in the year.
I always like to see these items which are not linked directly to the business shown separately.
8 - Other Costs
You may also have one off other costs which need to be shown separately to make it easier to compare on month with another.
For example, you may have costs of employee lay-offs and redundancies which would distort performance if not highlighted in a separate category.
9 - Interest
This will reflect your financing policy and while it is an important cost, it is best to separate.
10 - Profit Before Tax
A convenient sub-total to show how much economic gain you have generated.
11 - Taxation
If only death and taxes are inevitable, you may still have some scope for reducing your tax payable or delaying payment.
Check with your accountant. A big advantage of preparing monthly accounts for profitable businesses is that it means tax planning can be done from a position of knowledge.
12 - Profit After Tax
The profit you keep within your business for the period.
Measuring Your Cash
There is an old banking mantra which you will do well to remember:
Turnover is vanity, profit is sanity but cash is reality
There are two main ways of monitoring and reporting your cash flow and bank balances.
1 - Receipts and Payments
2 - Reconciliation from Profit to Cash Flow
I will explain what they both are before telling you when I prefer to see one version of the other.
Receipts & Payments Cash Flow
Effectively this is a summary of money going in and out of your bank and can be a summary of what happened in the last week, month of financial year to date or can be a forecast for a future period or periods.
Receipts
1 - Receipts from cash & credit card sales - you get this money immediately you make a sale
2 - Receipts from customers who have been allowed a period of credit between when they have the goods or service and when they pay. You may get paid 30,60 or 90 days after sale. Money that customers owe is called a debtor or receivable.
3 - Money from investors, wither as shareholders or as loans.
4 - Sundry receipts - this is the catch all for any other money you receive. For example you may have a car in your business and sell it.
Payments
1 - Payments in cash, by credit card or automatically deducted from your bank account to your suppliers for goods and services received. These are payments you have to pay immediately.
2 - Payments for supplies where you have received credit. As a business becomes more established, some suppliers will allow you to buy on credit. Money that you owe is called a creditor or payable.
3 - Payments to your staff for their wages and salaries.
4 - Payments to the tax authorities for money deducted from the employee payments and the social security costs charged on wages and salaries.
5 - Payments to the tax authorities for value added tax or other sales taxes.
6 - Payments to the tax authorities for taxes on the profit the business makes.
7 - Payments for new capital expenditure (fixed assets like cars, computers, plant & machinery and even property.)
8 - Payments on bank loans
9 - Bank interest
10 - Dividends paid to the business owner
11 - Sundry payments
Your Cash Flow
Your cash flow for the period is the difference between the total of your receipts and the total payments.
This can fluctuate a lot from month to month because some payments may only be made every 3, 6 or 12 months.
Your Bank Balance
This is your bank balance at the start of the period plus your cash flow.
It will increase if your cash flow is positive but decrease if your cash flow is negative.
Your Cash Forecast
It is a good idea to prepare a cash flow forecast for 12 months by month to show your funding requirements and to make sure that you really can afford to spend money on new equipment.
Some companies who are short of cash or determined to keep a strong control over their cash will prepare a weekly (or even daily) cash flow forecast cover the next month or 13 weeks.
The Profit To Cash Reconciliation
This is the type of cash flow report big companies use to explain why the movement in profit is different to the movement in cash.
Timing delays come from the credit given to customers and received from suppliers together with less regular payments of business tax, capital expenditure and dividends.
The basic format is:
Operating profit
plus depreciation
=EBITDA
- Working capital requirements
= Cash flow from operations
- Capital expenditure
- Business tax paid
- Dividends
- Loan repayments
- Interest payments
= Net cash flow
What is all this accounting jargon?
Sorry about that but jargon is difficult to avoid when talking about accounting.
Depreciation is a charge against your profit to reflect the fact that a fixed asset has an extended life.
For example you may decide that your new desk top PC should last 3 years so the cost should be charged against your next 36 months of profit.
The depreciation charge in a non-cash cost. You don't pay it to anybody because you have already paid for the fixed asset as capital expenditure.
EBITDA stands for earnings before interest, tax, depreciation and amortisation [amortisation is like depreciation.]
Working capital is the total of your stock/inventory, debtors (receivables) and creditors (payables).
Key Working Capital Measures
Working capital is the net amount of money that your business needs to finance its ongoing trade.
Your customers expect to buy now but pay in 30 or 60 days time but that is the same basis which you buy on from some of your suppliers.
If you sell a physical product then you may be expected to carry some inventory/stock so that you can supply to your customers faster than your suppliers can supply to you.
The key idea to understand for nearly all businesses is that as you sell more, you need to be able to finance more working capital.
This is why businesses who are growing quickly and profitably can become bankrupt. The profits generated from the extra sales don't finance the extra working capital requirements.
Inventory Days or Stock Days
This measure relates the value of your stock to your average daily sales and tells you how many days of stock you have on average.
Inventory is usually valued in your accounts the purchase cost or the cost to manufacture so you need to compare this with your average daily cost of sales.
Let me talk you through an example.
You sell $1,000 per day at an average margin of 35%.
This means that your cost of sales is 1,000 * (1-35%)
= $650.
That makes sense because you will have $350 margin each day.
Now suppose that the value of your inventory is $39,000
By dividing your inventory by the average cost of sales you calculate the number of days worth of inventory you have.
=39,000 / 650 = 60 inventory days
It doesn't mean that you have 60 days worth of inventory for every product but on average you do. You may be out of inventory for some products and 90 days worth of some items which are selling more slowly than expected.
This is a key assumption for your forecasts because it will determine your buying habits from your stock system.
If you decide that based on your customers unpredictable needs and the slow lead times of your suppliers that you should carry 90 days of inventory, you will be forecasting to buy more in the short term.
Or if you decide that you should only have 45 days equivalent of inventory, you will be reducing purchases in the short term.
Inventory Turn
You may sometimes see inventory measured not in terms of inventory days but by inventory turn or stock turn.
This means the number of times you expert to turnover your inventory in a year and is the inverse of the inventory days.
If you have 60 days of inventory then on average you expect to turnover your inventory six times per year (365/60 or in months 12/2).
If you have 90 days of inventory then you expect to turnover your inventory four times per year (365/90 or 12/3 in months.)
Turnover is vanity, profit is sanity but cash is reality
There are two main ways of monitoring and reporting your cash flow and bank balances.
1 - Receipts and Payments
2 - Reconciliation from Profit to Cash Flow
I will explain what they both are before telling you when I prefer to see one version of the other.
Receipts & Payments Cash Flow
Effectively this is a summary of money going in and out of your bank and can be a summary of what happened in the last week, month of financial year to date or can be a forecast for a future period or periods.
Receipts
1 - Receipts from cash & credit card sales - you get this money immediately you make a sale
2 - Receipts from customers who have been allowed a period of credit between when they have the goods or service and when they pay. You may get paid 30,60 or 90 days after sale. Money that customers owe is called a debtor or receivable.
3 - Money from investors, wither as shareholders or as loans.
4 - Sundry receipts - this is the catch all for any other money you receive. For example you may have a car in your business and sell it.
Payments
1 - Payments in cash, by credit card or automatically deducted from your bank account to your suppliers for goods and services received. These are payments you have to pay immediately.
2 - Payments for supplies where you have received credit. As a business becomes more established, some suppliers will allow you to buy on credit. Money that you owe is called a creditor or payable.
3 - Payments to your staff for their wages and salaries.
4 - Payments to the tax authorities for money deducted from the employee payments and the social security costs charged on wages and salaries.
5 - Payments to the tax authorities for value added tax or other sales taxes.
6 - Payments to the tax authorities for taxes on the profit the business makes.
7 - Payments for new capital expenditure (fixed assets like cars, computers, plant & machinery and even property.)
8 - Payments on bank loans
9 - Bank interest
10 - Dividends paid to the business owner
11 - Sundry payments
Your Cash Flow
Your cash flow for the period is the difference between the total of your receipts and the total payments.
This can fluctuate a lot from month to month because some payments may only be made every 3, 6 or 12 months.
Your Bank Balance
This is your bank balance at the start of the period plus your cash flow.
It will increase if your cash flow is positive but decrease if your cash flow is negative.
Your Cash Forecast
It is a good idea to prepare a cash flow forecast for 12 months by month to show your funding requirements and to make sure that you really can afford to spend money on new equipment.
Some companies who are short of cash or determined to keep a strong control over their cash will prepare a weekly (or even daily) cash flow forecast cover the next month or 13 weeks.
The Profit To Cash Reconciliation
This is the type of cash flow report big companies use to explain why the movement in profit is different to the movement in cash.
Timing delays come from the credit given to customers and received from suppliers together with less regular payments of business tax, capital expenditure and dividends.
The basic format is:
Operating profit
plus depreciation
=EBITDA
- Working capital requirements
= Cash flow from operations
- Capital expenditure
- Business tax paid
- Dividends
- Loan repayments
- Interest payments
= Net cash flow
What is all this accounting jargon?
Sorry about that but jargon is difficult to avoid when talking about accounting.
Depreciation is a charge against your profit to reflect the fact that a fixed asset has an extended life.
For example you may decide that your new desk top PC should last 3 years so the cost should be charged against your next 36 months of profit.
The depreciation charge in a non-cash cost. You don't pay it to anybody because you have already paid for the fixed asset as capital expenditure.
EBITDA stands for earnings before interest, tax, depreciation and amortisation [amortisation is like depreciation.]
Working capital is the total of your stock/inventory, debtors (receivables) and creditors (payables).
Key Working Capital Measures
Working capital is the net amount of money that your business needs to finance its ongoing trade.
Your customers expect to buy now but pay in 30 or 60 days time but that is the same basis which you buy on from some of your suppliers.
If you sell a physical product then you may be expected to carry some inventory/stock so that you can supply to your customers faster than your suppliers can supply to you.
The key idea to understand for nearly all businesses is that as you sell more, you need to be able to finance more working capital.
This is why businesses who are growing quickly and profitably can become bankrupt. The profits generated from the extra sales don't finance the extra working capital requirements.
Inventory Days or Stock Days
This measure relates the value of your stock to your average daily sales and tells you how many days of stock you have on average.
Inventory is usually valued in your accounts the purchase cost or the cost to manufacture so you need to compare this with your average daily cost of sales.
Let me talk you through an example.
You sell $1,000 per day at an average margin of 35%.
This means that your cost of sales is 1,000 * (1-35%)
= $650.
That makes sense because you will have $350 margin each day.
Now suppose that the value of your inventory is $39,000
By dividing your inventory by the average cost of sales you calculate the number of days worth of inventory you have.
=39,000 / 650 = 60 inventory days
It doesn't mean that you have 60 days worth of inventory for every product but on average you do. You may be out of inventory for some products and 90 days worth of some items which are selling more slowly than expected.
This is a key assumption for your forecasts because it will determine your buying habits from your stock system.
If you decide that based on your customers unpredictable needs and the slow lead times of your suppliers that you should carry 90 days of inventory, you will be forecasting to buy more in the short term.
Or if you decide that you should only have 45 days equivalent of inventory, you will be reducing purchases in the short term.
Inventory Turn
You may sometimes see inventory measured not in terms of inventory days but by inventory turn or stock turn.
This means the number of times you expert to turnover your inventory in a year and is the inverse of the inventory days.
If you have 60 days of inventory then on average you expect to turnover your inventory six times per year (365/60 or in months 12/2).
If you have 90 days of inventory then you expect to turnover your inventory four times per year (365/90 or 12/3 in months.)
Free Reports To Help You Use Key Performance Indicators
Here are a few of my free reports on the topic of measuring your performance, using key performance indicators and accounting/finance.
- Guide To Buying Accounting Software
- A guide mainly targeted at UK businesses to help you find good accounting software.
- Lessons In Understanding Financial Ratios
- Accountants and bank managers use accounting ratios with ease but
- How To Understand Your Accounts
- A short guide to explain Profit & Loss Accounts, Balance Sheets and the essential difference between profit and cash.
Links To Help You Improve The Way You Use Key Performance Indicators
Here are external links to help you find the best resources on measuring and managing performance.
- What Is The Balanced Scorecard?
- A link through to the Balanced Scorecard Institute packed with information. While much of the focus is on implementing the balanced scorecard in large companies, the principles of having a balanced view of performance aligned with your business stratgy remain true for any business.
- The Balanced Scorecard - Wikipedia
- Wikipedia's guide to the Balanced Scorecard.
- Key Performance Indicators - Wikipedia
- Wikepedia's guide to key performance indicators.
- Digital Dashboards - Wikiepdia
- At a glance performance guide often based on a traffic light system of green, amber and red with drill down capabilities.
Survey On How Effective Business Performance Is Measured
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How Happy Are You With Your Professional Accountant?
My research shows that a company is unlikely to employ their own qualified accountant until they have about 50 employees unless the business is particularly complicated.
This means that most small businesses rely on their professional accountant to provide them with guidance and information on how to measure business performance.
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My Business Coaching Blog
The Business Coaching Blog covers a wide range of business related topics but includes articles about measuring performance.
Fetching RSS feed... please stand byWhat Tips & Advice can You Share About Measuring Performance With Key Performance Indicators
I am eager to make my lens as helpful and as interactive as possible.
Please share any tips or ideas for performance measurement or share stories about how effective performance measurement made a difference in your business.
The Eight Pillars Of Business Prosperity
My business coaching methodology is based on the Eight Pillars of Business Prosperity.
There is an overall in the Business Profitability lens and I intend to publish lenses for each of the pillars.
There is an overall in the Business Profitability lens and I intend to publish lenses for each of the pillars.
- Business Profitability
- This lens explains how the Eight Pillars of Business Prosperity can be used to build a bigger, better business which will increase your profit.
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Business Development Coaching for customer focused entrepreneursBusiness Development Advice - third party business development products reviewed.
Your Profit Coach is a trading name of Planning & Control Solutions Ltd, a company registered in England No 3897173
Registered office, 2nd Floor, 3 Brindleyplace, Birmingham, B1 2JB
Copyright 2008 Planning & Control Solutions Ltd
Selected articles from the Business Coaching Blog
- Affiliate marketing
- Discover the inside secrets to affiliate marketing and earning profits from a blog.
- Probably the best marketing service in the world
- Recommendation for the Guerrilla Marketing Association based on the Carlsberg lager adverts.
- Speed up your listening
- Do you want to listen to more audio programs but don't have the time? Faster Audios could be the answer.
- Rich Schefren New Beginnings
- February 2008 conference from Rich Schefren and Strategic Profits
- Systematically work on your best profit opportunities
- Advice from Scott Hallman
- Profit Building Perry Ludy
- Comments about the Profit Building book
- Why you need a business coach
- Brad Sugars of ActionCOACH explains why you need a business coach with these two videos
- Attitudes & Behaviours To Create Small Business Success
- Free report which explains the attitudes and behaviours needed for small business success.
