Welcome to The Ledger where we sum up the latest finance and accounting news and trends for you. On this week’s entry, we’re diving into the topic of how to measure success in a business and how companies can utilize that data to propel their company forward. Read on to learn what metrics are key to your company’s growth, what KPIs you should measure to boost customer retention, how family offices measure success, and why relationship building matters for businesses.
Key Metrics To Utilize For Your Company’s Growth
With data becoming more accessible, organizations are changing their tune and using more tools and resources to make more informed decisions. However, an overload of information can lead to clutter and productivity issues that make it hard to analyze. The solution is to prioritize your metrics and understand which ones your company needs to become successful. Here are few key metrics that can affect small-to-midsize companies as well as large corporations:
Lead generation and scoring. If you want to build your customer base online, creating forms on your site is one way to achieve that. Additionally, you can also find leads via social media and blog engagement.
Customer service and satisfaction. Continuous customer feedback is a must throughout every industry. This easiest way to gather feedback is through reviews which can be measured in real-time.
Employee engagement. You’ve probably heard the phrase, ‘The customer comes first’. The same can be said for your employees. If you want to know if your employees are satisfied at work, opt for using an Employee Net Promoter Scores.
Predictable and unpredictable revenue. If you want to stay ahead of the curve, develop predictable revenue streams such as subscriptions and memberships - this can help you improve your budget planning. Another thing to watch for is unpredictable revenue streams such as viral videos. Both streams allow businesses to measure recurring profits and customer retention rate.
Cash flow and available credit. Cash flow is a vital metric to measure, but so is available credit. By keeping a credit line open, companies can ensure that their employees and vendors are getting paid on time.
To explore how to measure the right metrics, read the full article on Forbes.com.
What KPIs You Should Measure To Boost Customer Retention
A decade ago, customer service was not at the forefront of any one company’s mind. In fact, most customers received and paid for their services without a second thought. It was purely transactional. However, in recent years, customer service has become just as important as the products and services a business offers. But other than reviews left on Yelp or social media platforms, how can you measure customer satisfaction?
While KPIs can definitely show you whether or not your organization is financially sound and operating smoothly, they can also indicate whether or not your customers are happy with your business. KPIs can tell you:
Customer acquisition numbers
Repeat customer numbers
Marketing campaign success
… and more.
Let’s look at a few customer service KPIs that you need to be mindful of:
Customer satisfaction score
Net promoter score
First response time
Average handle time
Customer effort score
Customer retention rate
Service + quality
Complaint rate and complaint satisfaction
To learn how to leverage customer service KPIs to improve the customer experience, head over to Business2Community.com to read the full article.
How Family Offices Measure Business Success
If you know what a Family Office is, you know that they’re comprised of the world’s most successful individuals and organizations. But do they measure success like other companies do, or in some other way? According to a survey done by Agreus, 45 percent of Family Offices think that success begins with a healthy return on investment, while 30 percent believe client satisfaction is the key to success. So if they believe those are the factors that define success, how do they measure those factors?
Return on investment
To read more about how Family Offices measure success, head over to Forbes.com.
From Return On Investments To Return On Relationships, How to Measure Business Success
Just like you wouldn’t throw money at your children and call it a day, you shouldn’t do the same with your business. Moreover, thanks to the ever-evolving digital boom, relationship building matters more now than it ever has. And according to Seth Godin, “In the connection economy, trust and relationships are the new currency. It’s not a soft thing you do in your spare time, it’s the heart and soul of your business.”
But let’s face it, what was once considered relationship building decades ago has vastly changed. Nowadays, companies are having to get in front of their customers by curating content specifically for the customer. Why do you think having a position solely dedicated to social media is a thing now? Return on relationships is not an overnight process - it takes time and commitment, and more times than not, it’s a long wait. Fortunately, organizations who play the long game reap the reward - their relationship building turns into dollars.
To read the full article on why return on relationships is equally important as return on investments for a business, read the full article on FinancialPost.com.