It's all in the numbers

When you become self-employed or start running your own business you often hear about “having to wear all the hats”.? And what that means is having to be across all areas of the business

?? Finance

?? Legal

?? Strategy

?? Operations

?? Sales and marketing.

Whatever your original career background there will be some hats that you are not used to wearing.? But becoming comfortable, or at least having a working-level knowledge, of all these areas is really important.?

Spoiler - Because they are all your responsibility and recognising that is what will ensure your success.

One of hats which can be most uncomfortable when you start your consulting career, is finance.

So When I say “Key Metrics” maybe you shudder a little bit (?) but it is so important to have an understanding of your financial performance.? And key metrics are your cheat code to this.

Why?

Key metrics are the things you measure which track and assess the performance and underlying health of your business.? It helps you monitor progress towards goals, make quick decisions and identify areas of improvement.

I think about them in terms of “canaries down the coalmine” - they are the first indicator of what might be about to impact on your financials.

Each industry will have different types of key metrics or KPIs and you can use these as a baseline.? But every business has subtle differences so make sure you personalise them for what makes sense for YOUR business and also what you are able to easily track.

Key metrics should not take hours to pull together.? They should be short and sharp.?

It’s also important not to have a long laundry list of metrics to monitor.? Key metrics should be KEY.? It’s the same principle as focus.? If you’re focusing on too many things you’re really not focusing at all.

Some of your key business metrics can be simple financial metrics

• Revenue
• Gross margin
• Profit

But what we really want to do is go the next level down and look at those indicators which talk to how healthy your business is and how efficiently you are using the resources in your business.

The point of the key metrics is TO TAKE ACTION.? You’re not recording this so someone can give you a pat on the head for running a mature business.? You’re tracking these metrics so that you can take action in your business.

I believe that when small business owners gain confidence in their numbers, it's like unlocking a superpower.

If you’ve loved Corporate to Consultant, you might want to get on the waitlist to be the first to know about something exciting coming soon that will have you feeling confident in your business finances.

Championing your success,

Michelle