Numbers are my thing. Data is my thing. Hence, the reason I started my business, Diga – a digital accounting business. I understand the importance of data, how it can change your business and I understand how reporting is key for any kind of business growth. But I am very aware that this is not the case for most small business owners.
However, when it comes to business, ignorance is not bliss. Being ignorant of numbers and data has the potential to kill your business. This is where Key Performance Indicators are so powerful.
Key Performance Indicators (KPIs) play an important role in all businesses. All businesses, no matter their size, want to be able to meet their objectives. In order to see their objectives and to know whether or not they have been met means that they need good, strategic reporting.
What is a KPI report?
KPI reports measure the performance of certain areas of your business, giving you a detailed summary on how well or how poorly the areas are performing.
These reports also provide you with accurate data information and actionable feedback.
To the small business owner, every area of the business seems important, but a properly established and strategised KPI report will give you detailed information on the make or break areas of your business.
It is important to understand that not every area in the business needs to be scrutinised so heavily. Rather, it would be strategic of you to:
- measure and report on those areas of your business that give it a competitive advantage over similar businesses.
- choose those areas that hold the key to the success or failure of the business.
- choose areas that are under your control to change and improve on. It’s no use trying to measure how the weather affects performance since you cannot control the weather.
- select KPIs that are appropriate for your industry.
Effective KPIs should be actionable, crucial, and easily communicated throughout the business. Running KPI reports will help your business better define and track the numbers you want to hit. Contact us should you require further assistance in setting up and reporting on your KPIs.