It’s all about results!
Small business owners typically do not take the time to measure the results of the actions they take.
Many small business owners cannot document where their business comes from. Does the business come from referrals? Does your business come from cold calling? Does your business come from direct mail? Does your business come from the internet?
If you don’t know where your business is coming from, how do you know where to spend your time, energy and money?
Let’s say most of your business comes from cold calls over the phone. How would you measure the effectiveness of cold calling? Let’s say it takes 50 phone calls for you to make 10 appointments and for teach 10 appointments you make one sale. What this implies is that you are tracking the number phone calls you are making, you are tracking the number of meetings that you’re getting, and you are tracking the number of closes you are making.
If you are making your 50 phone calls and not getting your 10 appointments we know that there is a problem with your approach. If you’re making the 50 phone calls and you’re getting the 10 appointments but are not closing any sales, then we can get very clear on what you’re saying to the customer to close the sales.
WHAT YOU MEASURE GETS YOUR ATTENTION!
Here is the real reason measuring everything is important: when you know what works you can train someone else to it exactly the same way. You already put in the hard work to determine how to be successful. Because you have done this work you can now train somebody else to do that. This will allow you to free up time to move onto the next aspect of the business that requires your attention. If it does not work, you know where to begin to fix the problem.
Let’s look at another example: direct mail. When you are doing direct mail piece, industry standard suggest that a 2% return is the norm. What this means is if you sent out 100 pieces, 2 people will want to buy your product or want to learn more. If you are measuring your results and you find you are getting a 10% return, then you want to figure out what you did to achieve that return so you can create a measurable, repeatable and predictable process to get the same results over and over. The next time you do that direct mail piece you may change, for example, the headline. If your response rate goes down then you know the headline was working really well. If the response rate goes up than you keep using the new headline. But never change more than one thing at a time. If you do, you will not know what changes cause the response to change.
Let’s take a look at accounts payable. I once worked on an accounts payable process where each clerk was processing 75 invoices per day. After we documented what they were doing and redesign the process, productivity improved to 300 invoices per day per person. This freed up significant resources, improved cash flow and improved morale. They now had a performance benchmark that was used to determine pay increases. Management then took the money saved and used it in other areas of the business that required attention.
MEASUREMENT IS THE KEY!
As you can see, measuring results is very important. But let’s make one more distinction. And that distinction is the difference between results and accomplishments. I define results as actions that lead you forward to the goals that you have defined in your business. I define accomplishments as actions they keep you busy but don’t take it or to any specific goal. Without goals, it is easy to be accomplished and not achieve the desired results.
To your success,
Ron Finklestein
www.aboutbusinesssuccess.com
Ron@akris.net
