You improve what you measure. Here is why micro-monitoring ticks.

Regardless the size of your business, you must practice micro-monitoring to avoid small challenges and misses from becoming huge. You want to implement a system where issues are identified instantly and rectified. Unlike micromanaging where you ask people to do something and show them how they should do it and the money they should spend, in the process you undermine their own intelligence and their ability to provide you with innovative ideas to grow your business.

With micro-monitoring, you tell your staff your expectations of them (targets) and ask them to give you a work plan showing clearly the key milestones and budget of how they plan to achieve the targets. Thereafter, you undertake ongoing review of the promised results through timely reporting. That way, challenges are identified in time and addressed.

Micro-monitoring uses clear metrics to monitor every department and provides all managers with immediate feedback on how things are going.

  1. Clearly designed financial statements, available monthly or on demand, that show the current condition and past operating profitability in sufficient detail for problem areas to be identified quickly and actions to be taken. In your company, which are the top areas of interest?
  2. Performance areas for every department and operational area – starting with sales revenue and going down the list of major expense and income areas. In other words; an operating budget for each department. This helps you manage your costs and revenues and keep an eye on what matters most to the business.
  3. An accountability chart (otherwise known as an organizational chart) tied to performance areas or targets that are, in turn, tied to the financial statements and to the operational budget so each key executive knows exactly what’s expected in terms of financial performance
  4. All key performance indicators (metrics) per performance area are identified and a reporting system is in place to provide on-demand and automatic feedback to all managers, all the time.
  5. A corporate culture is in place that values training, coaching and individual initiative. It is a culture that develops employees at all levels.
  6. Strategic initiatives are defined for improving the performance of all operational areas of your business including administration, operations and sales
  7. A management team performance review is held immediately following the preparation of the previous month’s financials (on schedule) so that steps can be taken to identify and focus management attention in any areas that are off track. Each department head reviews his or her area’s results and explains all variances from budget. Action plans for dealing with issues are developed, responsibilities are assigned, interim review schedule set and calendars updated.
  8. Company performance appraisals, not just of people, but also of processes are held regularly and are based on job description goals and financial performance requirements.

This is what is meant by micro-monitoring. Daily flash reporting on all key metrics is the way business managers in dynamic businesses like yours can discover what is going on “out there”. The organizational structure described in this article is the best way to maintain high levels of accountability for performance and ensure that the tasks that need to be done are being accomplished according to plan.

When operating strategies are in place for all departments and accountability for performance has been established, this micro-monitoring should be all an owner or business manager needs to keep the company on track toward its goals.

Above all, your structure should be clear to provide clarity of reporting and accountability. Each staff should be able to know their immediate supervisor.

Factors Requiring Measurement

  1. Written sales for yesterday, Month To Date (MTD) and YTD (year to date) by department or sales outlet
  2. Written performance versus goal for any defined period, but always MTD.
  3. Delivered sales for yesterday, MTD and YTD.
  4. Delivered performance versus goal for any period, but always MTD.
  5. Close ratio for MTD, YTD for total store and by salesperson.
  6. Average Sale for MTD, YTD for total store and by salesperson.
  7. Revenue per product for MTD, YTD for total store and by salesperson.
  8. Actual written and delivered sales by salesperson versus goals.
  9. For furniture stores, sales performance for fabric protection & other add-on sales versus goals. Available on demand — sorted by salesperson.
  10. Cash on hand.
  11. Total inventory by category & location.
  12. Total on order by category.
  13. Current accounts payable (cash requirements).
  14. Total accounts receivable.
  15. And many more.

You can improve only what you measure! If you don’t measure the key metrics, chances of your business growth will be low.




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