11 Performance Metrics for Improving Business Operations
How do performance metrics produce more effective day-to-day operations? The solution is aggregating the right data and using it to create and enhance company processes and business operations.
Key business metrics for performance provide direction for future strategic growth.
The success of your company relies on the consistent reporting and evaluation of these metrics. The obvious and most important metrics for operations managers include revenue and profit and loss. But these are only a few of the things a savvy business owner should keep an eye on.
Regardless of your company’s size or specific goals, there are a series of key business performance metrics you should consider adding to your data arsenal.
They fall into the following three categories:
- Marketing Outcomes
- Employee Performance
What are the most important business performance metrics to keep an eye on?
Let’s take a look!
With hundreds of metrics applicable in this piece of the puzzle, we will focus on the fundamental business performance metrics for improving business operations.
The metrics will vary depending on the kind of marketing your company does, so modify this list to fit your needs:
- Return on Advertising Spend
- Customer Acquisition Cost
- Time to Payback
- Marketing Originated Customer Percentage
Aside from the ambitious solopreneur, every company of every size must include employee performance metrics if they want to use metrics to boost operations.
The success of a company often hinges on the consistent evaluation of employee performance, as the other key business metrics (financial, marketing) rely on employee effort.
Accurately evaluating your employees is based on a series of key business performance metrics:
- Employee Efficiency
- Quality of Work
- Adherence to Values
You may be wondering why we only included quality and not quantity.
Quantity is inherently measured in the efficiency metric. Quantity without quality works against your business. Quality is in it’s own segment.
The actual work being produced is reviewed in order to determine true quality. Because this is subjective in most cases, creating a measurement process is crucial.
For example, an employee in a sales service position like insurance proves they do quality work by retaining clients.
For less specific roles, consider implementing a quality score that both the employee and their direct manager completes on a task-by-task basis.
Additionally, measuring work that is of sub-par quality can help provide an overview of the employee’s efforts. Here are some things you can quantify:
- Error rates
- Customer satisfaction levels
- The amount of work that must be redone
Individual performance is difficult to measure manually and talent management software has helped lift this burden.
Having the right metrics in place provides you with a consistent flow of data you can use to streamline effort and increase success.
While the process of developing these metrics can be a bit challenging, the positive outcome is worth it.
Use our outline to create the custom reporting structure for your business. With consistency and execution, you will see your business thrive.