For many companies, measuring their business performance is the last step they take when launching a new business improvement initiative. Unfortunately, not reassessing the business metrics can be just as debilitating as not reassessing the business processes and procedures first. It is critical to know what you want to achieve, and at what point you will be successful, before setting out to make changes.

Four Questions Support Business Performance Improvement

To initiate a new business improvement effort, start by asking these questions:

Where is my business today?
Where would I like it to be in the future?
What is the plan to get there?
How will I know when I am done?

Using the answers to these questions as a starting point. Then begin to ask “how will success be measured” when it comes to the following eight items.

Product/service quality
Product/service innovation
Product/service delivery
Product/service profitability
Time to market
Market share
Corporate citizenship
Customer satisfaction and loyalty

These eight items serve as valuable performance measures to support business improvement initiatives. By understanding what success is for these eight items, a company can establish performance targets, measure their progress, and how to go about continuously improving business performance.

Translate the Measures into Performance Improvement Action

Measuring is only useful if you use the data. It is essential to go from measuring to action particularly in terms of improving business performance and sustaining customer loyalty. Explore how you can use the measures to improve business performance in these four areas to strengthen your competitiveness:

Product innovation and quality
Delivery speed and agility
Relevance and responsiveness
Proactive alert and exception management

By gaining insight into your current performance in these four areas from both inside (Marketing, Sales, Customer Service, Product Management, Professional Services, etc). and outside of the company (suppliers, customers, channel partners, etc.), you can identify areas for improvement.

Categorize all the feedback into Product (engineering, design, production, quality), sales, service (service, support, warranty, etc), Marketing, and Operations (accounting, purchasing, supplier management, etc), so you begin to determine where changes are required. Establish a set of performance targets that will serve as a guide and help frame the key performance indicators (KPIs). The more customer-specific the performance targets and KPIs the better. For example, the Product team may need performance targets around design-to-delivery, for customer service it may be customer retention year over year, for the Sales team it may be new customer adds by month/yr and by region and channel.

The goal is to use these performance targets as a way to improve and/or strengthen your position in the market. In today’s environment, it’s easy for companies to focus on near-term sales at the expense of being strategically positioned for the long term. By being focused on today’s numbers it might be possible for one of your competitors to swoop in and introduce improved solutions that have new features and broader appeal.

Purchase Your Assessment

It is more critical than ever to keep a regular pulse of your customers and your market. This should include research beyond the here and now of what customers like and dislike. You should also evaluate any new and emerging challenges that exist for your customers. You can do these through interviews or by conducting executive-level roundtables. Your customer advisory boards provide an excellent vehicle.

Some good jump-starting questions for conversations with customers include:

What keeps you up at night?
What are the challenges threatening your businesses?
What products and services do you see a need for in the future? Is their business growing, declining, or leveling off?
What is driving your customers’ businesses will enable you to continually innovate and improve the products you offer?

In a world where market windows continue to shorten and barriers to entry continue to decline, this kind of information can provide insight into what it will take to remain competitive.

FAQ:

Q1: Why is measuring business performance critical before and during improvement initiatives?
A: Measuring performance upfront ensures clarity on current state, desired future state, and success criteria. Without this, efforts risk being unfocused or ineffective, undermining long-term competitiveness.

Q2: What four foundational questions support business performance improvement?
A:

Where is my business today?
Where would I like it to be in the future?
What is the plan to get there?
How will I know when I am done?

Q3: What key performance areas should companies measure to support improvement?
A:

Product/service quality
Product/service innovation
Product/service delivery
Product/service profitability
Time to market
Market share
Corporate citizenship
Customer satisfaction and loyalty

Q4: How can performance measures be translated into actionable improvement?
A: Use data to drive improvements in:

Product innovation and quality
Delivery speed and agility
Relevance and responsiveness
Proactive alert and exception management

Q5: How should feedback be categorized and used?
A: Collect insights internally (Marketing, Sales, Customer Service, Product Management) and externally (customers, suppliers, partners). Categorize feedback by function (Product, Sales, Service, Marketing, Operations) to identify where changes are needed and set specific KPIs.

Q6: Why is maintaining a regular pulse on customers and markets important?
A: Continuous research uncovers evolving customer needs, emerging challenges, and market shifts, enabling proactive innovation and strategic positioning to stay competitive amid shortening market windows and lower barriers to entry.

Q7: What questions can jump-start customer conversations for insights?
A:

What keeps you up at night?
What challenges threaten your business?
What future product or service needs do you foresee?
Is your business growing, declining, or stable?
What drives your customers’ businesses?

Q8: Where can I get expert help to develop performance measurement and customer insight programs?
A: VisionEdge Marketing provides advisory services to design metrics frameworks, implement continuous improvement processes, and facilitate customer engagement programs that drive sustainable growth.