As the end of the year approaches, a lot of business leaders scramble to assemble the information they need to assess their department or company’s performance. It may be too late to eliminate the year-end rush, but there are ways to simplify the year-end review to reduce complexity and improve clarity.
Ultimately, the purpose of a year-end review is to assess, at the department and company levels:
- What worked/went well
- What is not working
- What changes need to be made in the new year
The most effective way to make these assessments is, of course, with trusted data. Companies that leverage data well have already developed key performance indicators (KPIs) to keep track of important aspects of the operation on an ongoing basis. These companies have an easy time conducting a year-end review by compiling trended views of these KPIs and comparing them to the annual goals they developed for each metric.
You may not have time to collect all of the data you need to conduct such a deep level review as you would by monitoring performance in real-time, but you should be able to gather enough of the most common KPIs to develop a “snapshot” of your company’s annual performance.
Some of the KPIs you could pull together before the month is out include:
- Sales growth
- Working capital
- Net profit margin
If your company is highly sales-driven, you could also add additional sales metrics like net customer count, sales per account, etc. If manufacturing efficiency drives more of your profit, adding metrics like on-time orders, labor as a percentage of cost and customer satisfaction would help you develop a helpful assessment tool.
While monitoring these KPIs should be an exercise that takes place on a weekly or monthly basis, the end of the year is good time for “taking stock” of all KPIs in the organization. If all department heads use their numbers to assess their area’s performance with an eye to “what worked, what didn’t, and what can be improved” the entire company benefits. This can also be a good opportunity to compare those three views across departments to spot company-wide trends or problem areas.
Developing useful KPIs from trusted data sources should be at the top of your wish list for 2019. If you think your organization could benefit from a KPI Review by Triple Helix, contact us today.