in Business

Measure everything important, track everything worth tracking

I’ve been thinking about the next generation web design studio quite a bit lately. What makes a team effecient. How can small teams maximize efficiency.

Bob Parsons who runs GoDaddy has written about tracking and measuring important business numbers. I read this and said “yeah, I need to do that.”

One thing I learned early in my business career is that anything of significance that is measured and watched, improves.

Back before I started Parsons Technology I became impressed with something I read about John D. Rockefeller. In fact, I still think about it and use it to this very day. I learned that Mr. Rockefeller was one of the few people in his industry (perhaps the only one) who knew exactly how much it cost to extract, refine and deliver a barrel of oil. In fact, he was entirely aware of all his costs. Knowing this information (and acting on it) gave him a huge competitive advantage. He knew how much he could price a barrel of oil for and still turn a profit. He was always keenly aware of each area of revenue, cost and market share, and he worked on improving in every area. As a result, he did cost saving things like manufacture his own oil barrels, have his own cartage company, and on and on.

The first sentence is the most important. Read it if you skipped over it.

This all brings me to my point. I think it’s very important to track the numbers that make your business a success. I’ve tried to do this over the years and have tracked a large number but never to the extent I want (for numerous reasons, not that I didn’t try).

As I said, I’ve been thinking about the next generation web firm and wondered what numbers you track in your business or where you work? The obvious things like revenue and billable hours are obvious, the less obvious are things like average employee utilization across a period of time, or average timespan to develop a site… How does this affect the bottom line? Does it give you a competative advantage? I’ve got loads of ideas about things that can be tracked. Putting systems in place to actually track them (consistently) is the next step.

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