Information comes from putting data into context, which you and your team can then use to make informed decisions about steering your business. Just as with collecting your data, if you do some analysis and then do nothing with the resulting information, you are wasting your time. One of the crucial things that your analysis should tell you is how your business is doing, but what exactly does that mean? Well, are you doing well or not? Is your business going to survive or not? Are you going to build a successful business on the foundations of that survival? At least some of the answers will depend upon how you define success.
In Chapter 3: Planning Properly, we discovered how important thinking is to your business, and that thinking extends to just about everything that your business does. The purpose of thinking is to produce plans and those plans must include targets; expectations of achievement, against which you can measure your business’s performance. So, how are you going to define success?
There are many different kinds of business and many different kinds of people. You have to decide what kind of person you are and what kind of business you want. If you define ‘success’ as starting and running a business that provides you with enough money for your basic needs, then configure your targets accordingly. If you wish to grow your business to become a national, if not international, leading provider of whatever it is you intend to sell, then those targets are going to be different. Regardless, you must have in your mind, and therefore in your plan if it is to be implemented, an idea of what you want to achieve. What, to you, does success look like?
Apart from being able to agree as a team that you have achieved your aims, your targets allow you to steer your business as a proactive manager not a reactive coper. If you need 1,000 sales per year and by half way through the year, you’ve secured 13, then you need to steer your business towards greater sales and marketing efforts if you are to avoid the failure abyss. If, instead, you are ahead of your expectations, then you can focus on other things, like reducing the amount of waste that producing your goods and services generates, for example.
You determine what you want to achieve, determine your business targets, communicate your plans so that things get done, establish ways to measure your achievements, compare your achievements against your targets and make decisions based on whether you are ahead or behind on those targets. If you are to survive and succeed, one of the things upon which you should focus as a business owner is making things better. Whatever you and your team do should lead to improvements in something. Otherwise, what an earth are you doing? What’s the point of putting in all this effort if the resulting information prompts you to think in a way that does nothing other than keep things the same?
Looking to make improvements in all facets of your business is not only desirable, it’s a necessity in today’s business world. Do you want to survive? Well, do whatever it is that you do better than your competitors. If they are doing something better than you are, then improve what it is that you do. Otherwise, they’ll succeed whilst you merely survive; they’ll survive whilst you drive into the failure abyss.
With all this information circulating in your business, it is important to ensure that the right information gets to the right people. Different members of your team will need to make different decisions depending on the part of your business in which they are operating. There is little point giving your office junior the cash flow projections for the next year, whilst your Finance Director takes receipt of the anticipated requirement for staples and pencil sharpeners across the same period.
In addition, whilst it is quite possible that different parts of your business will be making decisions based on the same, or similar information, it is likely that they will require the information to be in different formats, for the context to be different. For example, let’s take the projected sales figures for the next six months. That data will be important to many parts of your business: the finance team, to allow them to project income and expenditure across that period, the operations team, to determine their personnel requirements, the sales team, to determine what type of sales campaign to run, and so on.
But the same projected sales data will provide the necessary information only after its context has been added, and that will be different for your different teams. Your finance team need to apply context relating to income from sales and cost of those sales to produce information in the form of monetary values. The operations team need to apply a context of productivity per person to produce information in the form of numbers of human beings required. And the sales team need to apply a context of routes to market to produce information in the form of the necessary speed and depth of market penetration.
Proactive management is good. Reactive coping isn’t
We saw in Chapter 3: Planning Properly that you (the owner of your business) are responsible for the highest levels of thinking within your business. In other words, you have to produce the ‘grand plan’ that everyone else in your team follows. But, after that, you don’t have to figure everything out on your own. Delegation of responsibility and authority for getting things done (Implementing), for measurement of achievements (Numbering) and for comparing those achievements against your targets (Analysing), is not only desirable but necessary if you are not only to succeed, but to sleep at night. In effect, you delegate the processes within TINA’s sectors; converting plans into achievements, achievements into data, and data into information.
But there is one sector that is conspicuous by its absence and that’s Thinking. It is vital that you delegate some of the thinking, too. I’m not saying that you abdicate responsibility for thinking, just that you deploy your resources in a way that maximises the probability of successful thinking outcomes, otherwise known as planning. Your job is to think about your business as a whole, and as that will be occupying a great deal of your time, let those who have the right skills do the appropriate thinking about other things. If you are not an engineer, then it makes little sense for you to be thinking about engineering problems when you have a qualified engineer in post. If you’re not a scientist, then leave the scientific thinking to them.
As the owner of your business, your job is to ensure that the right information gets to the right people, allowing them to make the best informed decisions that they can about the areas of your business where they have the expertise. Taken together, all this expert thinking will increase the probability that your business will survive.