Measure performance and set targets

Measuring business performance alone is not enough. To improve results, you need to link your key performance indicators (KPIs) and metrics to clear targets and business goals.

Importance of setting targets

Each KPI you measure should have a clear target. Without targets, it is difficult to understand how your business is performing. For example, you may not know:

• if you're on track to meet your strategic goals
• if productivity is improving or decreasing
• if customer satisfaction is falling
• if profits are growing or declining

Use SMART targets

Set business targets using the SMART framework:

• Specific - clearly define what you want to achieve, who is responsible and how it will be done.
• Measurable - make sure you can track progress and measure results.
• Achievable - set realistic targets based on past performance.
• Realistic - focus on improvements your team can control.
• Time-bound -  set clear deadlines to track progress 

Find out how to decide which key performance indicators to measure.

Assigning responsibility and resources

After you set your business targets, assign clear responsibility to a team or individual for delivering each of them. Make sure you provide them with the right resources, such as time, budget and staff, to achieve your targets. Review progress regularly to keep teams motivated and make changes where needed.

Review and improve performance

Regularly review how your targets are working and adjust them if needed. This helps you respond to changes and maintain strong business performance. A clear planning cycle can help you anticipate problems and adapt more quickly.

If you need expert support with assessing your business performance or setting targets, you can appoint a non-executive director or seek help from skilled management consultants.