As a CEO, you never want to be surprised by a situation, or be in the dark about a challenge facing your business. At the same time, you could drown in all of the internal reports and paperwork that are generated in any given company.
CEOs typically have very few disruption-free blocks of time; they’re usually never alone or uninterrupted for more than 15 minutes – if that. When you are that busy, and when you have so many people and decisions demanding your time, what reports are worth taking time to review?
Know Your KPIs
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Within every organization, there are Key Performance Indicators (KPIs) that tell you how well each division is functioning. If, for instance, you run a staffing company that provides bodies, one of your KPIs might be the number of open positions you haven’t filled. If you have two open positions out of 200, you know you’re doing well. If you have 20 open positions out of 40, you know you’re doing badly.
Each of your direct reports has a set of their own KPIs. For sales, it might be the number of proposals submitted or the percentage of sales against quote. For operations, it might be the number of units in production, the number of orders filled, or the number of items produced per hour. Whatever the specifics, these indicators allow them to judge how their direct reports are doing.
Delegate Your KPIs
The key is for you, as CEO, to establish 4-6 KPIs on which you always want to be updated. These will give you a quick picture of how the organization is doing. Depending on the nature of your business, you might need these reports monthly. If you’re operating at a high volume, perhaps weekly.
In a production or manufacturing environment, it could even be daily. Typically, though, most CEOs will have a monthly report on these major KPIs so they can keep their finger on the pulse of the organization.
Revisit Your KPIs
As we head into strategic planning season, it’s a good time to revisit your KPIs. Don’t take for granted that the same indicators will always tell you everything you need to know. Has the scope of your organization grown over the year? Are there more or different factors that need to be measured? Talk about them with your direct reports, and make sure you’re getting the most valuable and accurate snapshot from your data.
Make sure you’re giving time and attention to these metrics. These are the reports that are worth your time. If you asked your direct reports, “Where are we against this KPI?” their answers should tell you exactly how your business is doing.