When you were a student, wouldn’t it have been great to know if you answered a test question correctly before proceeding to the next one?
Would it have changed your final test grade if you’d been able to respond to questions based on finding out if your previous answers were right or wrong?
Chances are, you would have gotten a better grade if you had known you were on the right track. Instead, most of us received our final grade – good or bad – after the entire test had been completed and graded. Students today complete many online assignments that allow them to receive real-time feedback on the questions as they answer them. It helps them to improve their overall score.
Fortunately for business owners, there is a way to see if your business “answers” are correct before the end of a defined period of time, such as a month or quarter. It’s possible with the Entrepreneurial Operating System’s ™ (EOS) company Scorecard.
A Scorecard is the EOS’s ™ answer to a correct-as-you-go test. It’s a weekly report that monitors your business, identifies issues or problems early, and predicts future developments. It’s a snapshot of numbers that tells you how your business is doing. It is based on factual data because the numbers don’t lie.
As a real-time report, a Scorecard allows you to
- Analyze your company’s predetermined goals and objectives
- Identify and solve problems as they come up, instead of learning about them after the fact when it’s too late to make corrections
- See all of your company’s data all in one place, saving time gathering reports from multiple people
Every company’s Scorecard is unique to them. It’s composed of five to 15 numbers that serve as the pulse of your business.
You can create a company Scorecard in six steps:
Step 1: Together with your leadership team, identify the numbers that your business must have. List the categories you need to achieve your goal. Categories will be specific to your organization, but typically include measurables such as accounts receivable, customer relations, weekly revenue and cash balances.
Step 2: Determine who will be accountable for each of the categories. EOS recommends that it is the person who is responsible for producing the number.
Step 3: Decide on the weekly goal for each category. This should correlate with the one year plan on your Vision/Traction Organizer tool.
Step 4: Enter the next week’s date on the Scorecard to hold you accountable.
Step 5: Select one person to be responsible for compiling the numbers and entering them on the Scorecard for the leadership team to analyze.
Step 6: Put it to use. Don’t place it in a file or a drawer. It will only be effective if you use it consistently.
The Scorecard is designed to give you a continuous three month glance at your company’s numbers, making it easy for you to identify trends and problems.
Don’t learn your company’s final grade at the end of the test, when it is too late to adjust your answers. Take advantage of the opportunity to check your answers as you go with a company Scorecard.
Interested in developing a Scorecard for your business? Contact us. We can help.
EOS is a holistic management system with simple tools that help you do three things we call vision, traction, healthy. Vision from the standpoint of first getting your leaders 100% on the same page with where your organization is going. Traction from the standpoint of helping your leaders to become more disciplined and accountable, executing really well to achieve every part of your vision. Healthy meaning helping your leaders to become a healthy, functional, cohesive leadership team.