Would you rather grow revenue or increase margins?
Speaking broadly, every business is trying to do one or both of those goals. That's where the conversation starts - a decision to grow revenue by 50% for example. Something nice and general.
What actions need to be taken to achieve that goal?
You likely need to do some of the following:
Increase number of sales
Increase prices
Get more leads
Be more efficient
Retain clients longer
Still super generic, right? It's because that's where things start. Let's take the easy, almost cliche, start and hone it into what we need.
I'll apply this to my industry, consulting, and more specifically data and analytics for small businesses. To build a roadmap, you'll need to know what you're starting at, where you're going, and measuring it along the way.
In other words, you need your data to supply some info, some analytics to determine the best course of action, and someone to make the decisions!
How do you build a data-driven roadmap?
The steps are fairly logical and straightforward but can take some time to create.
Decide on a goal
Establish a baseline
Analyze your current state
Develop the roadmap
Build the tools to measure progress
Adjust as needed
Step 1) Decide on a business goal
This one is the easiest and the hardest at the same time. For the purposes of this article, let's go with the "easiest" method and just go back to our original statement of growing revenue by 50%.
This would allow us to (for example) grow to the team size we want, give everyone the raises they deserve, etc.
Normally, this requires a little bit of math and a little bit of insight into the visionary’s plan for the company. The only consistent recommendations here are to make sure they are reasonable within the time limit. No such thing as an unrealistic goal, just unrealistic timelines!
Step 2 and 3) How do you establish a data-driven baseline? And how do you analyze your current state at the same time?
It's easy to look at your data (hopefully!) and say "we had 20 sales, we need to get to 30" (a 50% increase).
Where did those sales come from? How much was an average sale? Are there outlier clients or sales that should be thrown out? Maybe they should be focused on because we want more of them?
Use your data to guide you!
It becomes easier when the answer is right in front of you.
If your data tells you the following (for example)…
Most sales come from referrals
Most sales average $4,000 / month
You get 5 leads a month
Then you can build a game plan based off of that. You now have the starting point and the finish line. All you have to do is find the road between the two and execute! Easy enough right…
To get those answers "right in front of you", you probably need a dashboard that displays everything in the way you want it. Or at least something that is easy to update so you can continually measure and track it as you progress down the roadmap.
The three dashboard examples below are based on the three example findings above, but the thought process can easily be applied to whatever big 3 items you find (or know off the top of your head because you already have great data!)
Referral dashboard
Something like a referral dashboard should measure how many monthly referrals we get and where they come from.
Our top 10 referral partners
How many referrals have they sent vs how many converted
How many referrals or connections have we sent in return? After all, we want to be good partners
How many referrals a month do they produce?
How did we make those connections
Was it a networking event? Client? Podcast?
How are we nurturing those relationships?
Zoom calls, happy hours, coffee, gifts, etc.
And how often are we doing it
From some quick analysis (or just looking at the dashboard) we can develop a roadmap to maximize those referral relationships.
It's hard to induce a referral from someone, but we can make sure that there is a game plan to stay top of mind, keep our partners happy and informed, maybe even offer incentives, or add new referral partners so our pool of potential business grows!
Most sales average around $4,000 / month. Do we want to increase that?
Pricing dashboard
A pricing dashboard is something that evaluates your current pricing levels, by package, client, offering, etc. and is meant to help you find the right mix of your offerings and price that would lead to your desired revenue.
What packages are current clients on?
Is it producing the level of work we want?
Are our hourly rates where we want for each package?
Or margins in non- service based companies
Do we want more of a certain package that will help maximize our revenue? Or offer a new one?
Can the market bear a change in price or a new offer?
From this, we can get the landscape of what makes sense for us and our clients and make adjustments accordingly.
The simple solution is that most companies offer a Good, Better, Best model and most clients should be on the Better package and priced accordingly.
Depending on when the last time you changed prices was, it could be time to research, do comparison shopping, and test what new rates could look like.
Leads dashboard
A leads dashboard should measure how many monthly leads you get, where they came from, what stage they're currently at, and stimulate conversation on what's happening with each lead.
Example… We generate around 10 quality leads a month. Is that enough? Will it feed our sales enough? Do we only need 1 new client a month?
Here are some main pieces to this dashboard.
How many leads a month (trend over time)?
Where are those leads coming from?
More importantly, where are the Conversions coming from?
How long does it take to get a conversion?
Are we touching those leads as much as we should?
One of our big questions that could naturally come from that is: what lead source converts at the highest rate?
We've got a marketing ROI template for exactly that purpose!
From this, you can put together a lead strategy to target the highest conversion rate activities, and measure to see how your actions are paying off!
We then put all of these together and developed a plan.
In creating these dashboards, we can easily analyze what we needed to do.
Back to the decision - grow revenue by 50%.
We know we need to get more regular referrals, adjust our current pricing (up and down based on the package level), and generate more non-referral leads.
Now we get into the roadmap.
Step 4 and 5) Building a roadmap from data and analytics (and the dashboards that show the results)
If we want to grow revenue by 50%, we need to do all of this with some urgency but it can't all happen at once. We've got a business to run too…
We want to hit this goal in 12 months so we should be doing something each month (even each week) to get there.
Just from the examples above, we have some referral work, some lead work, and some pricing work. That list could be much longer, but I wouldn't recommend 10+ initiatives - it gets too hard to maintain focus quickly.
Our roadmap could start off like this:
Month 1
Analyze all the pertinent data to decide on targets
Month 2
Scheduled referral reach outs based on what tier of a referral partner they are
Month 3
Crawl, walk, run in price changes and test them with new clients and some existing
Focus on the lead generation activities that lead to the highest conversion rates and sprinkle in some new high potential ones
This is a data-driven strategy roadmap.
Also, since we developed our baseline dashboards with the goal in mind, we can continue to use those same dashboards to measure and adjust as needed!
The dashboards and analysis you do to find the baseline should be usable for the ongoing monitoring! That's why we said to make sure it's easily updateable.
That allows us to continually monitor, adjust, and make decisions in real time!
Step 6) Adjust as needed
We would just caution that, however easy it is to look at a dashboard and see the results, make sure you DO IT! Preferably with part of your team as well so you've got accountability partners.
Maybe a weekly or monthly meeting makes sense, but whatever cadence it is, use your dashboard to measure the one big thing in each initiative (plus some supporting measures) and keep everyone doing the actions on track and more importantly, on the same page.
These dashboards act not only as data visualizations, but guides to the conversation so you can have data-driven conversation and accountability partners!
Summary
The process is easy in theory…
Identify the goal
Do some analysis
Start executing
Consistent evaluate
In every piece of those steps, we need data, you need data, everyone needs data.
Having data isn't enough though - you need to be able to use it! That's where dashboards come in.
In the data-driven world we all live in, it's the data that supplies context, the dashboard that makes sense of it (puts it all together), and the humans that make decisions based off it.
If you want to grow your business, create a roadmap.
If you want to create a roadmap, use your data.
If you want to use your data, create dashboards.
You'll be informed, confident, and always measuring progress.
We're here to help!
About Pineapple
Pineapple is a data analytics company ready to help you become data-driven! We help analyze and visualize your data in custom dashboards so you can see your full business performance at a glance, and provide analysis to drive your strategy. Our interactive dashboards will save you time, provide deeper insights & analysis, and help you make better business decisions.
Learn more about our custom dashboards:
Other Dashboards:
Set up a call to learn more about how we can help you!
Comentarios