Blog posts tagged knowing your figures

Know your numbers to measure success

I am sure we have all driven in fog. Near me, there is a notorious black spot. It’s often foggy, and when it is, it’s like pea soup. As I carefully pick my way along, I’m usually passed by a few nutters doing more than 70mph. There’ve got no chance if they come across anything solid. It’s a way of playing probabilities that doesn’t appeal to me.

I know quite a lot of entrepreneurs that have started their own businesses. The successful ones always seem to have a deep knowledge of the key numbers for their business. As soon as you are talking business, they start telling you their figures. But this isn’t boring, geeky stuff. The numbers at their finger tips are the ones that show if the business is starting to work. They’re usually about the cost of getting new customers and how many were recruited last week. Then they explain how profitable it is, and whether more money should be poured in, or plans changed.

Starting a business is hard. You have to be both driven and confident to succeed. But confidence must be tempered with the reality that we all make mistakes. We need to measure things all the time. That way we can correct those mistakes and make adjustments as soon as possible.

Entrepreneurs that do everything by gut instinct are missing a trick. Like the maniac drivers in the fog, they feel invincible. But unlike most of the drivers, the majority of them won’t survive, at least in business terms.

Chris Barling is CEO of ecommerce software supplier Actinic

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