Have you ever wondered why coaches of many sports spend countless hours in reviewing video replays of their teams and players performances? These reviews obviously have a great deal to do with their team’s success otherwise it would be a tremendous waste of time and energy. I believe there are three basic reasons why tapes are reviewed. The CEO of a business should take note.
- It reflects reality. This is the starting point for decisions that will improve the future of the teams performance. Memories can be fuzzy. Excuses can be made. The video reveals the truth and prevents denial! Bestselling business author Ram Charan said concerning reality, ” this is the single most important task confronting a CEO (Charan,31) “.
- It reveals strengths. The team’s strengths can be capitalized on and enhanced further. The coach can then look at future opponents and know how his teams strengths can be played against his opponents weaknesses.
- It magnifies weaknesses. This is perhaps the most valuable use of the video. Weaknesses can keep an individual or team from achieving it’s full potential. Depending on the severity of the weakness it can bring down the team and cause a season to result in complete failure if not corrected.
What is the reality of your company? Do you constantly review the video and make corrections? What I am talking about is your company’s key performance indicators or the key numbers that reflect strengths or weaknesses in your organization. Although they vary by industry, the following basic key numbers can reveal much about your company. Do you know them? Do they reveal a weakness or a strength?
- Current Ratio
- Quick Ratio
- Inventory Days
- Accounts Receivable Days
- Accounts Payable Days
- Gross Margin
- Net Profit Margin
- Return On Assets
- Sales Per Employee
- Debt To Equity
* Charan, Leadership In The Era Of Economic Uncertainty