In preparation for my upcoming discussion group about Thriving in the New Normal, I have been doing some thinking, reading and collecting of ideas for ways to improve corporate performance. According to the 2010 U.S. Bank Small Business Survey, nearly 90 percent of small business owners across the nation say the economy is still in a slump and 75 percent expect the recession to continue into next year.
If there is a new normal and consumer spending has been reset for the next few years (or more), what can organizations do? Maybe it's time to take a good look at your company's operations with an eye toward giving it a tune up. Think in terms of striking a careful balance between cost cutting, new spending and improving operational efficiency.
Focus on the fundamentals by answering some performance questions like these:
1. What are your business goals?
Goals turn ideas into reality. Keep them concrete and measurable. For example, decide to cut utility costs two percent a month, or a specific percentage over a longer period of time.
2. Does your company have a budget?
The budget is the financial road map for managing expenses and income and gauging how close your enterprise is toward achieving its goals. Periodically compare budgeted spending to actual outlays and make adjustments where necessary, keeping the economy and your goals in clear view.
3. Do you benchmark?
Benchmarking compares your business processes and performance metrics to the competition and the industry, and lets you see areas for improvement. Ask such questions as:
· How do your enterprise's gross and net profit margins compare to those in the industry and your competitors?
· How do your firm's prices compare with the competition?
· Are deliveries fast enough and what do they cost as a percentage of sales?
If you would like a full list of questions (over 20 additional), please contact me.
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