Allen Set

Allen Set

Year-End Review and Goal Setting

Yes, it's that time of the year again – time to begin closing the books, reviewing financials, assessing performance and taking a hard look at the bottom line. How did performance match up against your goals? Did your marketing campaigns produce results? What were the effects of any cost-cutting measures you put in place? Where did new revenue come from?

If you can't specifically answer these or similar questions, then your goal for the coming year is simple: Improve your analytics. At the end of the day (or week or month or year), it always comes down to metrics. I have always embraced Tom Peters thinking: "You cannot improve what you do not measure."

That seems like common sense; however, there are still too many businesses operating blindly – businesses that fail to measure anything but the bottom line. And the bottom line will not improve unless you are making sound and informed decisions about every facet of your operation. You cannot make informed decisions without analytics. It all comes down to the data.

Chances are data is collected at every turn in your organization. In fact, the problem can be too much data. Too much information often leads to analysis paralysis. However, the good news is that there are ways to convert that data into actionable information – information you can use to make informed decisions and make them at the exact time they'll do the most good.

In addition to being a time of review, the end of the year is also the time to plan for the future and set goals for the coming year. No matter what goal you set for your organization, your first one should be to establish its metrics. How are you going to measure it?  Do not take one step until you decide exactly how you will measure your progress toward your destination. Increasing revenue or decreasing costs are obviously quantifiable and therefore, easily measured. Other goals may be less tangible, but that does not mean there are no metrics to track progress. A brainstorming session can lead to very creative, and sometimes out-of-the-box, measurements.

How you measure is not the critical issue. The fact that you do measure is… because anything that gets measured improves. So decide what you want to improve, set your goals, and then determine your metrics. With that formula, you'll enjoy the year-end review that occurs twelve months from now.

About the Author

Richard Allen is one of the co-founders of Smith & Allen Consulting, Inc. (http://www.saci.com), a firm specializing in analytics and ERP software. Having been a business management software consultant for over twenty years, he has an in-depth knowledge of Dynamics GP and related products. Most importantly, Richard understands best practices and has worked with accounting departments in several industries to implement them. It's this broader knowledge he shares in his articles.

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