5 Strategies to Improve Business Performance
Growing a business is all about building on your strengths and adapting to your weaknesses. If you aren’t constantly tweaking your methods for optimal performance, then you are letting your growth stagnate.
These 5 strategies to improve business performance are tried and true. They’ll help everyone from lone solopreneurs to fortune 500 companies ensure that their business is built for success.
#1 Measure Progress
For starters, you can’t really implement any strategies to improve business performance if you aren’t measuring your progress. After all, without benchmarks, how can you know if your efforts are succeeding or failing?
There are all sorts of ways to quantify your progress, but here are some key metrics that pretty much every business should track:
- Revenue. This is the total money earned from sales of goods or services. It’s the raw number before deducting expenses. Revenue is an important metric because it can give you an idea if your marketing efforts are paying off and what direction sales are trending in.
- Profit. Your profit is your revenue minus expenses. It’s the money that you actually take home at the end of the day. You’ve got to keep an eye on profits to make sure that your revenue isn’t all being consumed by the money you put into the business.
- Conversion Rate. Your conversion rate can be measured in a lot of ways. A typical method is the number of sales you receive divided by the number of visitors who see your sales page or product offer. (So, if you get 15 sales out of every 100 visitors, you’ve got a 15% conversion rate). This metric is helpful to determine if your salescopy is working and if you are driving the right audience to your offer.
#2 Set Short and Long Term Goals
Once you have decided on the metrics that are most important for you to track, then the logical next step is to craft goals around them.
It can be helpful to differentiate between short and long term business goals. Short term goals can be as small as setting an agenda for the actions you need to take today. But they can also cover the benchmarks you want to hit every month or quarter.
A good way to think of short term goals is as milestones that get you closer to your loftier long term ones.
For example, imagine you’ve set a long term goal of increasing your revenue by $50,000 in the next two years. You could then set monthly short term goals around the metrics that are going to get you there: views on your sales page, completed contact forms, number of calls, etc.
#3 Hire The Right People
Perhaps nothing is more important to the success of your business than the team that’s got your back. Whether you are just outsourcing microtasks to part-time freelancers or managing several dozen full-time employees, you need to know that you’ve hired the best of the best.
How do you hire the right people?
Well, trial and error is sometimes the hardest but most effective way to learn. Beyond that, one thing to remember is that your staff is an investment. Build a good team, and they should return much more than they cost you—whether that’s by bringing in actual cash flow or just freeing up time for you to focus on more profitable duties.
But your team is an investment. If you’re always hiring the cheapest people to do the job, you can’t expect the best returns.
#4 Be a Leader
Hiring the right team isn’t enough though. One of the key strategies to improve business performance is directing that team well.
In other words, be a leader.
There have been entire books written on the qualities of good leadership. We can’t do the topic real justice in this post. But here are three characteristics that you can start to develop today in order to be a better leader for your team:
- Be humble. A good leader knows that they aren’t masters of everything and they don’t have all the answers. While you’ve got to have a strong and energetic presence with your team, that doesn’t mean you have to try to be some sort of superhuman. Ask for their advice, admit when you’ve goofed, and appreciate the things that your team does better than you.
- Be decisive. A good leader makes decisions and takes action. Avoid wishy-washiness at all costs. While you might have staff who are there to advise you on certain aspects of the business, the final choices are yours to make.
- Be human. Finally, let your team see more than the business side of your personality. Just because you’re their leader doesn’t mean you can’t be their friend. In fact, the better they get to know you as a person, the more they’ll respect you as a boss.
#5 Invest in Marketing
If you want to move those KPIs in the right direction, you’ll need more than good staff. You’ll need customers!
Just like your employees, your marketing is an investment. Ideally, you put some money in and get more money out. This is why paid marketing efforts are one of the most important areas of your business to track carefully.
If you throw a thousand dollars into Google ads and only land $25 in sales, you probably aren’t making a good return (unless you’ve got a really high lifetime customer value). At the same time, don’t cut back your marketing budget too hastily. Sometimes, a few tweaks to your targeting options or ad copy here and there can really boost your ROI.
You also need to respect the difference between short and long term marketing investments. Paid search ads have a lower ROI but could get you results as soon as today. A long term SEO and content marketing strategy might take months to pay off, but the return on investment is usually much higher.
What Are Your Strategies To Improve Business Performance?
These are just a few of the strategies implemented by the team at Legiit and the hundreds of freelancers who use our platform on a daily basis.
What are some of your own? How do you ensure that your business is always performing better than it was the day before?
Let us know in the comments.