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28 2011

How Healthy Is Your Business?

Syndicated from: Your Planning Partners

Cholesterol is often described as the silent killer. High cholesterol is bad for us and yet there are no symptoms. There is no pain; there is no nausea; there is no shortness of breath. That is why doctors regularly check our cholesterol. Businesses have the Cholesterol Factor. Sales may be strong; profits may be good; customers may be happy. But lurking underneath, hidden from view with no adverse symptoms, may be indications that everything is not working as it should. And if we don’t do anything about it over the long term it will affect the health of our business. Like cholesterol we need to do regular check ups and when necessary take remedial action So how healthy is your business? The following 10 statements are what I call the Business Health Indicators (BHI). To determine the overall health of your business you score each BHI as follows: o If the statement perfectly describes you and your business give it a score of 3. o If your reaction to the statement is “you’ve gotta be kiddin” give it a score of 1 o Anything other than that, score it 2. 1. We have a very clear, well-defined vision of our future. 2. We have powerful, clearly documented three year business objectives that are specific, realistic and measurable. We review and update the objectives every 3 months. 3. We have broken our three year objectives into one year goals and have step-by-step action plans to achieve the goals. We regularly review the plans against actual progress and initiate corrective action when required. 4. Our team knows our vision and three year objectives and where appropriate is involved in the step-by-step action plans. 5. We spend at least a quarter of our time planning and managing the growth of our business. 6. We have monthly financial projections (revenue and expenses) and use them to monitor our financial results every month. When required we take immediate remedial action rather than “wait for it to correct itself”. 7. Our systems and processes are working well and will support the future growth in business. 8. We spend most of our time working on high value activities. 9. We have sales processes in place that ensure consistent and targeted sales activities. 10. We know what we’re good at and we don’t try to be all things to all people. So you’ve done the health check on your business; now what? As you do with your doctor first look at the overall results. • If your total score is 26 to 30 then you have a pretty healthy business. Continue the good work and book an appointment in 6 months times to repeat the check up. • If you scored 20 to 25 your business health is okay but borderline and so initiate some preventative actions to avoid further deterioration. Repeat the check up every three months until you are over 25. • If you scored below 20 then immediate action is required and you should repeat the exercise every month until you have the score above 20.

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