by Greg DiDio, CEO, Kite Technology Group
I’m a sports fan. Along with all the far more serious consequences of the ongoing pandemic, all national sports leagues are on indefinite hold. But you wouldn’t have to stop the games to keep me from watching. All you would have to do is remove the scoreboard. The games carry no interest to me, if I can’t tell who’s winning. In fact, the players would likely lose interest, too.
Without a scoreboard, strategy, talent, and hard work quickly become irrelevant.
The same is true in your business. If you don’t know how your team is doing, there is no motivation to strive to do better or to change course. Mediocrity is sure to follow. ALL high performing businesses keep score. Their “scoreboard” contains quantitative measures and can go by many different names. They may call it a dashboard or a scorecard. Each item on the scoreboard might be called a smart goal, a key performance indicator, or a measurable. Regardless of your terminology the key is that you need to know at regular intervals how your company is doing.
At KiteTech, we follow the EOS processes and terminology for creating our Scorecard. Here are four steps for creating yours:
1. Identify Your 5-10 Measures
Together with your executive team, identify the 5-10 measures that tell you whether or not you are “winning the game”. These measures should cover all the key elements of your business including customer satisfaction, employee engagement, financial performance, and sales. They should also include key operational measures related to quality and productivity. All these measures must be SMART. That is, they must be Specific, Measurable, Achievable, Realistic, and Time-Based.
2. For Each Measure - Set a Target
The target is based on what is acceptable performance. It should be achievable and aligned with your budgets and business plans.
3. Record each measure relative to the target at regular intervals
Each measure should be recorded at regular intervals. Ideally, this is weekly. Things change too fast in business to measure less frequently. Consider that you need three or four datapoints to identify a trend. If you measure monthly, it could take you three to four months to identify a problem! For us, financial goals are calculated monthly, but ALL other goals are measured weekly. Measures can be recorded in a spreadsheet or with various online reporting tools.
4. Identify corrective actions as soon as targets are not met
Of course setting targets and recording performance is useless if you don’t do anything about it. That is why this fourth step is crucial. You need to have a regular rhythm to review each and every measure and establish a corrective action if the target is not met. At every weekly meeting, our executive team reviews our weekly measures. We create specific action plans and assign an accountable person when a target is not met.
By identifying your measures, setting a target, recording performance, and identifying corrective actions, you will be well on your way to winning the game!
A Word About Scorecards and COVID-19
When this recent crisis hit, certain targets started getting missed. Having a weekly scorecard, enabled us to immediately quantify the impact, prioritize our actions, and respond. It also forced a discussion, to re-evaluate our targets and key measurables in light of the current reality. Far from constraining our actions because of pre-conceived notions of what success looks like, this preparation permitted us to focus our attention, assess the impact, and operate with more confidence in these uncertain times. I am not so bold as to predict the course of this virus or the impact it will have on the lives of our loved ones or our national economy. But I am convinced that our readiness is far greater and our response will be far more effective than if we had no scoreboard by which to measure ourselves.
Stay safe and lead with a steady hand,
Greg DiDio is the CEO of Kite Technology Group. He holds a B.S. in Electrical Engineering & Computer Science from The Johns Hopkins University and a Master of Business Administration (MBA) from Loyola University in Maryland. For the last fifteen years Greg has guided Kite Technology from just a few founding members to a leading national IT services provider for independent insurance agencies. Greg believes that healthy, prosperous work cultures go hand in hand with amazing client service. His passion is to build into leaders who are motivated to improve themselves while creating great companies with amazing work cultures.