However well (or badly) the current year turned out, year-end – when the final numbers trickle in – provides the perfect nudge for resolution and improvement.
Improvements on what fronts you may ask? Financial performance springs readily to mind (we are Singaporean), but there are other benchmarks as well.
Measure your financial performance
This is (not surprisingly!) the most sought-after measurement. All companies want to measure their profitability – where they stand in the ‘black vs red’ category.
You will first ask yourself what the company’s Gross and Net Profit Margins were for 2019.
You know the ritual: Liquidity ratios – how short-term financial obligations were met – gearing ratios and cash flow – a primary concern of growing businesses. You probably have this down to a tee, but how about other measurements?
Measure your customer satisfaction
This is significantly harder but nonetheless important. After all, finding and retaining customers is crucial for every business. Get customer feedback through:
1. Sales data: What your customers buy (or not buy). This indicates their preferences, and where you should focus your efforts.
2. Complaints: Not the most pleasant thing to attend to, but complaints are an important clue to your company’s shortcomings. Study these BEFORE your customers raise these concern elsewhere – like in public.
“Opportunities are where the complaints are.”
— Jack Ma, Alibaba
3. Questionnaires: A very useful source of information, so consider using incentives to encourage more customers to complete them.
Purple Sage, a leading boutique caterer in Singapore, counts High Level Satisfaction reflected in event feedback forms as a key KPI to measure.
Measure employee performance and welfare
What can be done internally, at employee level for 2020? HOW and WHAT can you measure?
HOW: Through meetings and appraisals
Informal meetings and formal appraisals are a direct way to monitor and encourage your individual employees. Have frank exchanges of viewpoint, set targets for progress and productivity. Take this as an opportunity to address staff concerns on business and welfare.
HOW: Through Timesheets
Yes. The oft-dreaded timesheet. Assure your employees this is not to ‘spy’ on them, but rather to measure time spent per project or customer, to validate the company’s efforts per project.
WHAT: Measure employee performance
Companies can also look at employee performance from a financial perspective. What are the sales and profit per employee? These measures shouldn’t be an alternative to appraisals, but they can flag areas of concern.
Measure your company against the competition
Benchmarking improves your understanding of your business performance and potential by making comparisons with other businesses.
Compare yourself against businesses in the same sector. Be realistic. A small business in a crowded sector may want to benchmark itself against average performance levels in the sector. A growing business may choose comparisons with an established market leader. In such manner, Scoot will not compare itself with Emirates.
A growing business may choose comparisons with an established market leader. Shopee would have looked at Lazada as a benchmark, until they overtook it as the top internet shopping platform in the region.
Finally, keep in mind that all measurements should be S.M.A.R.T.: Specific, Measurable, Achievable, Realistic and Time-bound.
Your ultimate target is for a happy & prosperous 2020!