To reach your Peak Profit Potential, fervently adopt a Peak Profit Potential mindset that focuses on continuous profit maximization. Why not keep more of what you earn? Plugging profit leaks is an incredible, yet often overlooked way to boost your profits on a continuous basis.
Designing and testing your performance measurement system is an important step. Look back over your high priority profit leaks and review the tools and ratios that provide insights for you to make faster, better, more-informed business decisions. Profitability is just a like a seed; there is so much potential in your business. You already have everything you need. Redefine major processes in your business and then measure, refine, measure. Build a simple system that runs automatically at the end of each month. Continuously evaluate your performance measures. Keep in mind that improved performance measures lead to increased profits in your business. So don’t marry your measures; keep improving them for even bigger payoffs.
Your New Perspective:
Look back and review how you implemented the 4-step PEAK program. Don’t be surprised by how much your perspective is changing as your performance management experience grows. You can now view your performance measures in the overall context of your business. When you’re fully satisfied that you’re actually measuring what you think you are, systematize your measures so they are generated automatically. Don’t leave systematic tracking of your performance measures to chance. Have them appear automatically on your screen around the first of each month and take the time to review the exceptions and trends carefully. After you’re satisfied that your measures are just what you need, continue looking for the next most productive areas for potential profit leaks in your business.
Many businesses get their operations on solid profit footing and then consistently reevaluate them each quarter. When any major profit leaks or business process events present themselves, jump on them as soon as you can. Measurement shouldn’t interfere with running your business; in fact, it’s an essential part of running your business. Measurement and change are not ends in themselves. Each new performance measure must prove its value to your business. And it must be doable. It must be scalable. And it must add value in terms of customer service, profitability, or both.
Change for Profits Sake:
Change can be quite disruptive so take a break when you need one. Fully implementing one measure is far more important than creating multiple new, incomplete and untested measures.
Start in a new area. Plug the leaks. Keep it going. Measure and report. Prevent future leaks in the same area. Many times one area will illuminate another. Dig deeper and drill down. You’re mining for hidden profits and there is pure gold there when you plug a persistent profit leak.
Looking into and fully costing your business processes can present you with a myriad of feasible and profitable options for you to consider. Analytically without emotion. Data-based decisions without haste. Business intelligence enables you to take back your power. Implement one or two, or none of the options. Base your decisions on performance measures that track customer value to reach your Peak Profit Potential.