Numbers are the language of business, and if you can’t speak numbers, you can’t speak business. This language is essential to understanding where you fall in your progress toward reaching goals and meeting key benchmarks.
The questions you can’t answer are always the best indicators of your level of mastery with your business. Masters are usually measurement freaks. Someone who’s mastered their business will know the numbers that indicate how well they’re doing and where there’s still room for growth.
Three areas you need to know:
Before you start crunching the numbers
There are two questions you should ask yourself as you start to figure out the numbers of your business. Knowing the answers to these two questions will help guide your goals and help you understand the numbers that are important to your metric for success.
1. How do you measure the success of your business?
Everyone may measure their success differently, but we all have a decision to make in identifying what we consider good business. How you measure your success will tell you how to act to get there.
2. What isn’t getting measured that you know should be?
Any entrepreneur that is actively seeking a goal or paying attention to the progress of their success probably already knows the numbers they don’t know but should know. Maybe these are the numbers that keep you up at night, or perhaps they’re the numbers you just haven’t figured out how to track yet.
Start your business dashboard
The idea is to create a “dashboard” for easy access to the numbers you should always have on hand. When you’re driving your car and want to know how fast you’re going, you just look at your dashboard. You don’t need to calculate your speed or do any fancy measurements that will take your eyes of the road. Do this with your key numbers.
But I don’t want you to get too caught up in the numbers. One of the reasons you should learn these numbers is so you don’t have to think about them. This frees up your precious time and energy when it comes down to making important decisions.
Mastery doesn’t happen quickly
Not all of this will stick right away, and some of this will take time to work into your daily routine, but the more you think about these things, the more natural it will become. When you know your numbers, you’ll have all the information you need to correct your course, catch small problems before they become big ones, and stay ahead of the curve when you reach a bump in the road.
It’s also my job as a coach to help guide and remind you of the important things that will help you make better decisions in your professional and personal life. The whole point of knowing these numbers is to track, trend, and interpret the critical information for making better business decisions and acting intentionally.