“7 Ways to Choose Small Business KPI” 

Strategic Results



People want to know how many miles they can drive their car for every gallon of gas they pour into the tank. That’s natural, don’t you think?

Similarly, every business owner likes to know how far their business can go before it runs out of money. I surely do want to know. And I assume you do too.

Some measure will tell them if their business is currently realizing their vision.

That brings us to an epiphany! Does the business have a strategic plan? You need one if you would like to know how you’re driving your business. As a business coach in Houston, I help you put that together.

business-coach-houston-choosing-business-kpi



1) Results You Want

Asking what results you want from your business could save you many hours. Yet, few do it. Results decide the work we need to do to support the business. It’s not the “to do” list like many think. Which could take you down rabbit trails. And I know you don’t want to go there. 

So give this a try. Would you want a certain cost per lead? Would you like a specific Return on Equity or revenue your firm produces? Whatever the result, be clear. It will help your team get behind it quickly.


2) Purpose

Asking why the results are important will guide you to your purpose–– your goals for the business. Language is powerful, so use it to describe it well. It could be as simple as achieving yearly revenue goal or a certain gross margin percentage. Either way, define it, as you’d see it, hear it and feel the emotions once your team achieves it. You may already know that working with a profitability coach in Houston will allow you to have a laser focus on results. 


3) KPI Format

Decide if numbers, ratios or percentages make more sense. Use the right format. That’ll make it clear to your team how their work affects the business. You want your team to know how the business is running, how they’re doing and what needs to change. 


4) Measuring KPI

Measure KPI to match the business role. For example, Marketing, Sales, Operations and Finance could use a separate metric for checking performance. As a business owner, you want to know at the end of each day if your business is moving forward. And you want to know if it’s moving at the right pace.


5) Rate of Communication

Using about 5 to 10 KPIs ask your team to report daily or weekly. Ensure they have the tools and methods to report. It will make it easier.


6) Measuring Key Positions

Look at your organization chart. Check the roles. Mark the critical ones. Then make them account for the right KPI.


7) Measure of Performance

For all businesses, Revenue, Gross Margin and Net Margin will show top-level performance. Decide on other KPIs based on the business. You want to use different ones depending on professional services, manufacturing or retail.

These 7 ways will help you grow your business quickly. 

Want even faster results? Are you ready to discover how? Call 281.410.5375 to grow your small business.

Written by Suresh Iyengar, P.E., President, Business Unit Execution LLC––“Explosive Business Coaching Houston Results For Small Business”. Want even faster results? Are you ready to discover how? Call 281.410.5375 and speak to your Profitability Coach Houston


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