How Often Should I Track Key Numbers?
Daily, argues Ron Friedman, CEO of Stonefield Josephson Inc., an accounting firm in Santa Monica, Calif. "Every morning by 9:30, I receive a printed report that tracks certain key results from the day before. That's a tremendous management advantage," he says, "since I can respond immediately to any problem signals. Think of all the time and money you lose when you find out about problems only at the end of the week or the month."
Friedman is convinced that watching numbers daily is as important for his clients as it is for his own 75-person accounting firm. "Depending on the type of business you're in, the numbers you need to watch this closely will be different," he explains. "Key numbers might be how much was sold each day, how much was shipped--if that's relevant, how big your backlog is, and how much was collected." To make certain daily reports are user-friendly, Friedman keeps them short. And he knows how numbers should compare with daily target results. "Small fluctuations are only natural, but once you track daily results for a while, you'll get a feel for those fluctuations that are more troubling," he notes.