Aside from the important basic KPIs that are attributable to every business, there are far more specific metrics that need to be monitored for every industry.
Too many businesses fail to produce adequate reports with these specific metrics which only inhibits growth. This is usually due to poor set up of accounting systems and administrative processes, which is often due to a lack of focus from the owner on items seen as ‘non-revenue producing or zero ROI’. Albeit these, in principle, are exactly that but have a huge intangible ROI that shouldn’t be overlooked.
Hospitality as an example has an enormous list of metrics that can be monitored and measured. Obviously, the size of the business will determine the time investment available to allocate to administration and only a large company will a full force of administration can monitor and manage all metrics in parallel, but in small and medium businesses there should be specific monthly, quarterly and annual goals to be achieved by implementing specific metric strategies one or a few at a time.
Examples of hospitality targets that are often forgotten or not monitored: –
Customer & Seating Efficiency – If you have a restaurant with 4 areas each with 4 wait staff, the booking team should be allocating tables to customers evenly across the 4 areas to minimise bottlenecks in the kitchen and ordering process.
Average Spend Per Head – Not only how much money is each person spending but how much money is each person spending with each of the wait staff. What is the associated incentive and target for wait staff and how does that tie in with the front of house managers target?
Bounce Rate – If 100 customers come into the restaurant and only 10 order food, the bounce rate is 1/10.
Basket Analysis – How many items are being ordered per head per table. How is management ensuring an upselling ethos is front of mind for all wait staff?
Implementing these strategies and new layers of KPIs will assist greatly in driving profit and by virtue of implementation, the management team will be forced into the 1% mindset.