If you’re a CEO, a founder or making decisions for a business at the executive level, it’s important for you to track the health of that business. If you don’t know how healthy your business is, day to day, you don’t have a means by which to judge if your decisions are good or bad. We can all learn from feedback, and sometimes the best feedback is data directly showing us the results of our decisions.
Today we’re looking at some different ways you can track the health of your business, so you have more of an idea of how your decisions impact your bottom line.
One of the most important assets your business has is its brand. Your brand is essentially the ‘face’ your company shows to customers, the human characteristics they assign your business in order to relate to it. You can try to directly affect your brand, building a reputation for quality, reliability, or value for money for example, but ultimately it is constructed by customers based on every interaction they have with every facet of your business. Your every decision has the potential to influence your brand for good or ill.
Brand tracking is one of the most important services offered by market research firms. This is a survey type that asks consumers to rank your business for the key values that define your brand, and to rank your brand against competitors in the field. This gives you a relative measure of what’s going on with your brand, and an absolute one you can use to measure yourself against the outside world.
In many businesses, revenue is the most important metric, and it’s not hard to see why. Money coming in from customers and clients is the lifeblood of a business, and it’s how you move away from the start up stage where you are sustained by investment to a more mature, self-supporting phase of your development.
Revenue alone can’t give you the full picture, though. A business with very high revenue can still be unhealthy and indeed unprofitable. Understanding where your money is coming from and where it’s going is more important than how much is coming in. You might need the help of specialist accountants to set up the monitoring you need to gain this understanding, but it’s an investment that’s well worthwhile. Understanding where and how you’re making profits, which areas of your business are too costly and quantifying the return on your investment in non-revenue generating areas of your company all build to a holistic, overall picture of the health of your business that can help you survive in the long term.