Opinion Editorials

Want to up your game in business? Start by knowing the score

scoreboard

(EDITORIAL) One of the most important factors when you are trying to make a gameplan is to check the scoreboard and know where you stand in the game.

WHO’S WINNING?

I’ve lived in the great state of Texas for more than 25 years and I regularly get the opportunity to drive across the state to visit my clients. During these long journeys, it’s not unusual to pass a small city in the countryside that has an enormous football stadium. Yes, everything you’ve heard about things being “bigger in Texas” is true – especially our high school football stadiums.

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At the end of each football field sits an old-school scoreboard, not the giant LED screens that have taken over college and the NFL. For the most part, these digital megatrons haven’t made it to Texas high school stadiums – yet.

But all scoreboards exist so the teams, media and fans can quickly understand where each team stands in relation to the game.

The central pieces of information are the Home and Away scores, and although the scoreboard does include a few other items of critical information, such as the amount of time left in the game, the quarter or the current down, the score is the most prominent. Why? People just want to see who’s winning.

RESULTS SHAPE FUTURE ACTIONS

We know that the coaches have a full arsenal of statistics beyond what you see on the scoreboard (e.g. completion percentage, yard per carry, turnovers), but they review those additional stats after the game. A simple scoreboard tells the teams and fans everything they need to know about the game while it’s happening.

Surprisingly, many businesses haven’t taken the time to create a scoreboard for their team members.

It’s a critical step in the pursuit of wins. Thinking back to a Friday night football game in Texas, imagine how different the game would be if neither the team, fans nor coaches knew the score. How would the coach know what plays to run? Should they run a hurry-up offense? Or should they focus on the running game to burn up the clock? It’s unimaginable to play a football game without a score.

START BY UNDERSTANDING THE GAME

To create a scoreboard for your organization, start by clearly understanding how your company wins at your game. What main activities need to be completed on a regular basis? What deliverables drive your business? These activities may be different from department to department, but start with the primary deliverable for your customer. What is it?

“Hint: It’s never about net profit. That’s a result of doing everything else correctly.”

A good way to determine the numbers on your scoreboard is to consider a balance of leading and lagging indicators. Lagging indicators happened in the past, such as net income, or the score of either team. Leading indicators are activities completed on a regular basis, such as open orders, or the current down. Typically, the accomplishment of a leading indicator will directly influence a lagging indicator. That’s why football coaches tell their players to think about one play at a time.

FOCUS ON CRITICAL NUMBERS

Greg Crabtree, author of “Simple Numbers, Straight Talk, Big Profits” holds that most critical numbers come with a quantity and a rate. For example, number of orders processed is the quantity, but we also need to know average gross margin per order – the rate.

Too much focus on either the quantity or the rate can create a problem.

For example, processing a lot of orders at a low margin is not successful – neither is producing a high-margin item, only to process a few. In football, you can gain a lot of yards on offensive, but it doesn’t mean much if you don’t score points. Always make sure you have a quantity and a rate.

Once you have identified the critical numbers for your scoreboard, the next step is to post and regularly update them.

I recommend that you start simple and evolve to a sophisticated solution over time. For smaller organizations, a dry-erase whiteboard that’s updated daily is a great first step. Once you’re comfortable with the data on your scoreboard, you can eventually adopt digital dashboards with fancy graphics that update in real-time.

But just like those old-school football scoreboards in Texas, the most important step is to let your team know if they’re winning.

#Scoreboard

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