How to Develop a More Objective View of Your Business’ Performance

Editor's Note: Take a look at our featured best practice, Objectives and Key Results (OKR) (23-slide PowerPoint presentation). Successful organizations are using Objectives and Key Results (OKR) now. OKRs are efficient way to track company and team goals and measure their progress. It helps every organization's success by cutting out unimportant goals and focusing on what truly is important within the organization. OKR [read more]

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New entrepreneurs tend to be emotionally invested in their businesses. To some degree, this is understandable. Businesses are more than just a means of making money. When you own a business, it can be the realisation of a dream. This comes with the satisfaction of seeing your ideas being brought to life. While this passion can help you drive your business to success, it is also important to be able to look at your business objectively.

Seeing your business objectively gives you a sense of how your customers and potential investors will see it. Analyzing your company from a strategic business management perspective also provides you with a more accurate sense of how your business is doing. When the rose-coloured glasses are taken off, you need to still be able to say that your business is viable for the long-run.

Let’s look at some specific things you can do to develop a more objective view of your business’ performance.

Consult Your Balance Sheet Regularly

A balance sheet is essentially a summary of the balance of assets and liabilities in your business. Keeping this information up to date and consulting it regularly will give you an overhead view of how your business is faring when it comes to finances. It will help you spot potential problems that may be emerging in your debts. And it allows you to put some numbers behind your confidence in your business rather than relying on your gut feeling.

Consult With Your Team Regularly

As a business owner, there are many psychological biases that you will be prone to have when it comes to thinking about your business. The best way to see past these biases is to gain some new perspective. This can easily be done with the help of your staff. Regularly asking your team for feedback and opinions will give you alternative viewpoints on critical issues in your business. These new perspectives will open up lines of thought that you would not have considered otherwise. By reflecting on these opinions, even if you ultimately go ahead with your original plans, you can be more confident in your decision-making.

Consider Your Own Weaknesses

All owners and managers have personal weaknesses. It can be difficult to acknowledge your own weak areas. But improving these areas is essential for managing effectively. Take some time to think about your managing style and your personality. Ask yourself the hard questions and think about how you could improve the way you operate. With regular reflection, you can be more objective about how you lead your employees and guide your business to success.

Ask Other Entrepreneurs

Whether they are in your industry or not, other business owners will have plenty of advice and perspective for you to reflect on. These points can help you better understand what you are doing well and where you could improve. Make sure to take advice with a grain of salt. You are the owner of your business, after all. But if you hear similar critiques from multiple people, then pausing to reflect on these things is worthwhile.

Build A Better Businesses With Objectivity

Successful businesses are the product of a great deal of passion. Entrepreneurs need passion to push them through uncertainty and struggle, and to see their ideas become a reality. However, business decisions are best when they are made with a degree of detachment. Using the tips outlined here to take a more objective look at your business will help you make better decisions in the future.

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Performance Management (also known as Strategic Performance Management, Performance Measurement, Business Performance Management, Enterprise Performance Management, or Corporate Performance Management) is a strategic management approach for monitoring how a business is performing. It describes the methodologies, metrics, processes, systems, and software that are used for monitoring and managing the business performance of an organization.

As Peter Drucker famously said, "If you can't measure it, you can't improve it."

Having a structured and robust Strategic Performance Management system (e.g. the Balanced Scorecard) is critical to the sustainable success of any organization; and affects all areas of our organization.

Learn about our Performance Management Best Practice Frameworks here.