How can I improve my management information?
The more you know about your business, the more likely you are to make good decisions. This is especially true when it comes to your finances, but it’s also important in boosting your employee morale and customer satisfaction.Here’s why you should focus on management information, and how you can improve it.
What do we mean by management information?Management information refers to any data that helps a manager to make decisions. When it comes to finances, this data usually takes the form of financial metrics to gauge a company’s performance. Common metrics include:
- Gross profit and gross profit margins
- Sales growth
- EBITDA (Earnings Before Interest, Tax, Depreciation and Amortisation).
Why is management information important?Running a business is all about decision making. Management teams make choices that will affect the entire future of their company, and this is why it’s vital to have good information. Taking a data-driven approach to management has all kinds of benefits:
- You can spot problems at an earlier stage and rectify them before it’s too late.
- You can set realistic goals based on up-to-date information.
- You can see the effects of your decisions reflected in the data, allowing you to change course if things aren’t working.
- Gathering detailed information shows your employees that you are engaged with the day-to-day running of the business.
- You will gain a more accurate understanding of your employees and their roles, making you a better people-manager.
How can I improve management information?Managers have access to a huge supply of information. The challenge is picking out the useful data from the background noise. There are a number of ways that you can make this easier:
- Invest in automated accounting software. This will make a huge difference to both the accuracy and the accessibility of your data. Most accounting software packages have a targeted search feature, letting you find the information you need in a matter of seconds.
- Make use of your accounting software’s reporting tool. Automated accounting software can generate detailed reports based on the metrics of your choice. This allows you to remain flexible, rather than waiting until the end of your normal accounting period to evaluate your progress.
- Talk to your team. This may seem obvious, but some of the most useful information can be gained simply by asking. Your staff may be better placed than you are to flag up problems and suggest possible solutions. You could schedule a regular team meeting where you open up the floor to employees, or create an online suggestion box for employees who wish to remain anonymous.
- Gather customer feedback. New technology has made it easier than ever to find out what your customers think of your service. Pay attention to online reviews and consider sending out a customer satisfaction survey. You can increase the number of responses by offering an incentive to those who participate. Also, try to update customers on the ways in which you are responding to their feedback. This will make them more likely to participate in future surveys.