As your small business grows, measures to track your performance as a whole become more and more important. Analyzing the output and performance of your team will be an integral part of your regular management schedule. This is where performance tracking tools come in.
1. SWOT Analysis
SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. It was originally devised by Albert Humphrey, a prominent business consultant who worked for the Stanford Research Institute.
The four elements fall into a 2×2 matrix: the helpful and the harmful, and the internal and external.
Strengths and weaknesses fall under the internal category. These are the elements that a business has full control over such as strong marketing fundamentals or a high attrition rate, and can be fixed at the management-level or below. Discuss these issues with your employees, and find out how these can be assessed and fixed.
Opportunities and threats fall under the external category. These involve wider economic issues, legislative matters, changes in technology, and changes in the social and cultural atmosphere. Often, you won’t be able to do much about these factors. You will have to find a way to steer your company clear of threats, as well as let your company ride the crest of opportunity.
SWOT analysis is a fantastic tool to understand the current situation about your company, and set goals accordingly. It will enable you to plan a corporate strategy well into the future. Furthermore, SWOT analysis can also be used at the micro level to deal with crises, as well as to gauge the feasibility of an enterprise.
2. PEST Analysis
Don’t be fooled by its acronym—PEST analysis is an effective complement to SWOT when the latter isn’t enough. Standing for Political, Economic, Socio-Cultural, and Technological analysis, PEST is more useful for big picture analyses when the external factors from SWOT aren’t enough.
Using PEST effectively will enable you to identify opportunities and threats long before they present an issue for your company, allowing you to embrace or avoid them, respectively. In addition, PEST will show you the undercurrents in your environment, letting you use changes to your advantage, as opposed to them catching you off guard. Finally, when entering a new business environment, PEST removes your preconceived notions and provides an objective viewpoint, letting you devise a long-term battle plan.
Sit down with your advisers and hash out the state of affairs in your city or region. Are elections coming up soon? Is the exchange rate stable? Is the unemployment rate high? How will new technology affect your business landscape? Targeted, far-reaching questions like these will help greatly in your brainstorming strategy.
3. CORE Assessment
More suited for start-up firms, CORE analysis is ideally suited to track plans for future growth. The acronym stands for Capital investment, Ownership involvement, Risk assessment, and Exit strategy. Using the CORE assessment, you take a look at the amount of funds the business needs initially, whether or not you will be actively involved in its daily operations, as well as your future plans.
CORE assessment can also be used for specific projects in your company. It involves a closer examination of your internal factors and your capacity to take on certain tasks as both a business owner and a manager.
These three performance tools will quickly let you see what needs to be done in your company. Use them interchangeably, letting each work with the results of the others. Give it a few weeks, and see if your analyses pay off.
Author Bio: Fiona King is a business blogger looking to share her expertise in customer relations and team management to online entrepreneurs.