It’s coming to that time of year again, when you look back at your strategic ambitions and chart your successes and what you still need to work on.
Maybe you think you can get away with not reviewing your business performance, if things have been going well for you, but this is a mistake. Take heed from recent e-commerce darling founded in 2006 Nasty Gal who sadly filed for bankruptcy on 9 November, showing you have to keep ahead of the game.
Answering these five questions will give you the basis on which to review and then improve the performance and profitability of your business:
1. Am I doing the right things?
Think about what you actually do, the products that you make, or services that you provide. Ask yourself what makes them successful, look back at testimonials or focus groups you’ve run. How they could be improved, what added value could you provide or what are customers asking for that you do not yet provide? Could you do things differently, perhaps employing technology, or are there things you need to stop doing which would give more opportunity to be innovative?
2. Am I as efficient as I could be?
It’s not about making money; it’s also about being efficient with what you have and planning for the future. Think about your premises, what are the advantages and disadvantages of your current location. Do you suffer from high staff turnover? Are staff motivated and satisfied? Do you make best use of technology such as wireless networking and mobile telephony to allow for more flexible working?
3. What do the numbers tell me?
Whatever you do don’t ignore the numbers. Look at the balance of all of the money flowing in and out of your business. Review your costs regularly. Are there opportunities to source cheaper forms of finance? Will you need to pitch for investment to grow your business?
4. What is the competition up to?
The longer you run your business, the clearer picture you have of who your competitors really are. A SWOT analysis is a good place to start but if you are seeking more in-depth information, you could commission some market research.
5. What are the trends for customers and the market in general?
This is a great opportunity to look up and out of your business and see what is happening in your market. Has it changed, what’s new, do customers want something more, what’s happening in the world that could impact you, exchange rate fluctuations, or increased priced raw materials.
Look out for my next blog, which will tell you how to use this information to plan for a new successful business year.