3 easy ways to improve your quarterly results
I always ask the same question, and no matter where I am I always get the same answer, silence. An uncomfortable look across the room accompanied by some fidgeting. Blank faces and biting lips. Some times I get the answer “Not many”.
The question? “How many consecutive months have you achieved revenue and profit goals?”.
Of course the people in the room are the leaders and owners of the businesses, the place where the buck stops as it were. So the logical next question is “why?”.
That’s when the excuses start.
Problems with staff, problems with customers, problems with salespeople, the market, the government, the banks. I could go on but the point is that almost all times a lack of consistency in revenue and profit can be attributed to poor execution, which can be overcome easier than you might think.
There are 3 main ways to improve execution and deliver revenue and profit consistently: Priorities, Data and Meeting Rhythms.
According to Stephen Covey only 15% of employees know their company’s top priorities and even worse only 6% know their individual priorities. In other words 94% of employees don’t know the most important thing they must do to contribute to the companies advancement, and only 85% know what the company must to do advance!
Or said another way;
The most important thing is to make the most important thing the most important thing.
So make priorities lists a part of your culture.
Every quarter have a company wide priorities list of the top 3-5 priorities for the company and share it with all. Post it around the walls, don’t leave it in a spreadsheet or email.
Every week track and publish your progress toward that goal for the quarter. Therefore they must be SMART goals – not something like increase revenue. Instead something like increase revenue by $25,000 per week.
Take these priorities to the business unit level. Each team and group should have a set of 3-5 priorities for the quarter which align with the company priorities.
Then take these priorities to the individual level. Each person in the business should have a set of 3-5 priorities for the quarter AND for the day.
This is what I call waterfall priorities and it enables a company to not only have everyone know exactly what the most important things are, but we are able to clearly link a company wide priority through business units to individuals, connect it with KPI’s and weekly reporting and increase the chances of executing significantly.
The key? Only 3-5 priorities per business company, business unit and individual and report on progress daily and weekly.
It has been my observation that too many leaders have either too few or too many KPI’s. They either have a glance at the Profit and Loss at the end of each month and perhaps sales performance, or they have exhaustive reports with so many numbers tracked that the reports are overlooked. As one executive said to me recently, “give me dot points!”
Also far too many HR managers provide a list of KPI’s for each role without any insight for the employee into which is the most important.
Try tracking the most important 1-3 KPI’s per person and 1-3 per business unit. These should be a combination of both leading (indicative of a future result) and lagging (an actual result). Then look across your P&L and Balance sheet and ensure every result has a person attributed to it. We use the FACe tool for this.
Finally develop dashboards to ensure the most relevant KPI’s are visible. This is not to admonish people, but to encourage a sense of shared responsibility and accountability.
Most busy people want fewer meetings not more, but the problem with most meetings is that they;
1. Don’t have an agenda
2. Generally run over time
3. Spent too much time either grandstanding or validating peoples achievements & excuses
Within our meeting rhythm framework there are 3 things that are occurring; Strategic Thinking, Execution Planning & Synchronisation.
Strategic Thinking and Execution Planning are developed at an annual planning and quarterly planning session, with synchronisation occurring at monthly, weekly and daily meetings (daily huddles). See this daily huddle video from online retailer Shoes of Prey as an example.
What do the best company’s do to achieve productive Quarterly and Annual Planning sessions? They bring in a facilitator. This allows the leader to fully participate, engage in debate fully and observe team members to develop them further.
The result is a business that consistently executes.
When you connect formalised strategic thinking and execution planning to individuals executing the plans, and then you use the right KPI’s to track progress and give all parts of the business clear priorities, consistent revenue and profit becomes the norm.