There is a danger to becoming obsessed with one metric – if all you watch is top line revenue, you may not realize that you aren’t achieving a high enough gross profit (or worse, you’re losing money on each transaction).  If your focus is on paying down a loan, you may miss an opportunity to earn a higher rate of return by investing that cash into your business.  On the other hand, if you are trying to accomplish too many things at one time, you will likely fall short of your goals on most, if not all, of them.

I’ve found that if you can establish a short list (2-4) of key goals, you’ll be well positioned to achieve them.  It varies from one industry to the next, and is dependent on your stage in the Company’s life cycle (Start up, Rapid Growth, Maturity, Decline…).  Generally, though, there are a couple of things that you will need to accomplish most in order to succeed:  The goals should be readily tracked, and you should make it a habit to review them at the appropriate frequency (at least monthly – probably daily or weekly).

I have a friend, Mike Tafoya (Estrada Strategies), who gave me the idea to look at a Company in a similar way to a car’s dashboard.  When you’re driving your car, you are likely monitoring your speed (no tickets, please), how much fuel you have left in the tank, and maybe something else – in my case, I keep an eye out for low tire pressure (it’s been an issue, what can I say?).  If you are trying to do too much at once (like read your email, dial your voice mail, change CD’s, etc.) you run the risk of an accident.

If you apply this logic to your company, you might find that the key goals define themselves: How quickly are sales growing?  Do I have enough cash to meet my obligations?  Am I collecting my receivables fast enough?

Once you’ve identified the items for your dashboard, create the report.  Oh, and keep an eye on your performance with at least as much focus as you would monitor your speed on the highway.  J