Purposeful Networking: Know Your Numbers!
In recent years, I’ve been told by so many people that I should write a book on networking. I’m so very grateful for the positive feedback but the truth is that for so many years before then I was not very good at networking… not at all. So I’ve decided to write a series on networking that has worked for me. Some of the content is original, but most is from watching and learning from those that simply do it so well. If you get something out of this, please do what I’ve done, share it! The better we get at networking, the more business we all can create!
With the start of the 4th quarter starting, there is a lot of business planning that should be done in preparation for 2023. How you prepare is going to determine how you progress, and what you use to prepare will undoubtedly determine what your progress actually looks like when you get it going!
Ultimately, the question I start with is, “What are my Numbers?”
This is a loaded question, because in any business there are so many numbers to track that figuring out which ones are important and which ones are derivative can send you into a spiral. If you have a substantive organization with staff and products and vendors and delivery expectations; the ability to determine which numbers are the Key Performance Indicators that drive your business, is also the ability to know where your time needs to be spent as the Key Performance Manager.
One resource I found had 170 KPIs broken down into 10 different departments, (image 1). That’s more than anyone could ever conceivably manage and expect to get any sleep on a regular basis. Larger businesses will have managers to help track KPIs by department, which certainly helps.
KPIs By Department
(Source: qlik.com)
But what if you are a small business?
The point is that in knowing your business, you really need to know the numbers that drive your business. I find that the KPIs that really drive my business revolve around the stages of business conversion from intake to closing. If the business opportunity isn’t maturing through our pipeline, then how much we have coming in won’t correlate to how much is closing out. I typically call these Lead Conversion to Transaction. We have 3 or 4 stages built in which are dependent on the type of real estate transactions.
There are two other KPIs that are critical to our business and also quite measureable in time spent, they are called the Sales Cycle Time and Milestones on Time. How much time we spend on transactions is very important to our business; it is its own KPI known as Time to Productivity. The better we manage milestones and sales cycles, the more effective we can be in properly applying our team’s time and resources for our clients and their expectations.
The market is always a variable that impacts KPIs. Down markets will expect more with less from us, testing the strength of our business processes and systems that manage our KPIs. Up markets will shape growth opportunities that create other types of pressure on businesses and can impact once reliable, but now outdated KPIs. It’s why so many small businesses also seek out customer service and employee satisfaction KPIs.
Too often the only number leaders focus on is the bottom line, and while that is important, if you don’t know what variables got you to that bottom line, then can you really say you know your numbers? And more importantly, can you improve upon them for 2023?
I hope you find this information useful, and as with anything we offer, please do not hesitate to reach out and ask any questions. We are always happy to help.
Diego Munoz
KW Commercial
diegom@kw.com
