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mistake #1: rely just on financial statements
Profit and loss, revenue and expenses these are measures of important things to a business. But they are information that is too little and too late. Too little in the sense that other results matter too, such as customer satisfaction, customer loyalty Nike VaporMax Flyknit Danmark , customer advocacy. Too late in the sense that by the time you see bad results, the damage is already done. Wouldn't it be better to know that profit was likely to fall before it actually did fall, and in time to prevent it from falling?
mistake #2: look only at this month, last month, year to date
Most financial performance reports summarise your financial results in four values: 1) actual this month; 2) actual last month; 3) % variance between them; and 4) year to date. Even if you are measuring and monitoring non-financial results Nike VaporMax Flyknit 2.0 Danmark , you may still be using this format. It encourages you to react to % variances (differences between this month and last month) which suggest performance has declined such as any % variation greater than 5 or 10 percent (usually arbitrarily set). Do you honestly expect the % variance to always show improvement? And if it doesn't, does that really mean things have gotten bad and you have to fix them? What about the natural and unavoidable variation that affects everything, the fact that no two things are ever exactly alike? Relying on % variations runs a great risk that you are reacting to problems that aren't really there, or not reacting to problems which are really there that you didn't see. Wouldn't you rather have your reports reliably tell you when there really was a problem that needed your attention, instead of wasting your time and effort chasing every single variation?
mistake #3: set goals without ways to measure and monitor them
Business planning is a process that is well established in most organisations Nike VaporMax Flyknit 3.0 Danmark , which means they generally have a set of goals or objectives (sometimes cascaded down through the different management levels of the organisation). What is interesting though, is that the majority of these goals or objectives are not measured well. Where measures have been nominated for them, they are usually something like this: Implement a customer relationship management system into the organisation by June 2006 (for a goal of improving customer loyalty) This is not a measure at all it is an activity. Measures are ongoing feedback of the degree to which something is happening. If this goal were measured well, the measure would be evidence of how much customer loyalty the organisation had, such as tracking repeat business from customers. How will you know if your goals Nike VaporMax KPU TPU Danmark , the changes you want to make in your organisation, are really happening, and that you are not wasting your valuable effort and money, without real feedback?
mistake #4: use brainstorming (or other poor methods) to select measures