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Crave Red And Graph Everything
We found out we hit the Inc. 5000 list for the sixth time. That means over a four-year span, we grew faster than most of the eighteen million US companies, all but maybe 5,000. Usually, we come in right around 1,000 because we double every year. The title of this episode is Crave Red and Graph Everything. I got talked into buying a piece of software called Rhythm in which it uses a Six Sigma fashion to track projects and it involves thirteen-week sprints, basically four quarters per year. You come up with a growth goal or a growth number. You break it down into thirteen weeks. As that project is tracked numerically if it’s on track, it turns green. If it’s slightly off track, it’s yellow. If it’s badly off track, it turns red. I know within two weeks of a thirteen-week sprint if something is off track. At first you think, “You don’t want to see red. That means things are bad.” No, I crave red because if I see red two weeks in a row, it means that I need to get involved and maybe use my managerial influence. I may need to broaden the team on that project. I may need to ask some questions. In the old days, I would turn a blind eye to that. Thirteen-weeks later, I’d find out that the project either failed or needs another ten weeks and then I’d get very angry usually at myself because I did not inspect what I expect.
When you track everything in business as a discipline, the world opens up for you. Click To Tweet
We actually have over 1,300 modules that are tracked by colors and it’s amazing. How do you do this if you can’t afford this Rhythm software? In the old days, there are these things called Excel spreadsheets. What you can do is you can graph everything. Let me give you an example. Let’s say you want to track advertising. Maybe you do direct mail and you want to track how many people hit the Contact Us button of your website. You put a Contact Us button up, you go into analytics, see how many people are hitting that button every day. Let’s say it’s two, three, four, then five, then all of a sudden it goes to four one day and then three one day and two one day. If you graph that over seven weeks or whatever it is roughly, you’d see it going up and up for about a month, and then down, you would know unequivocally when you graph it, the graph is going up into the right. After about a month, it peters out and it starts going down to the right. If you don’t look at the numbers on an Excel spreadsheet, you’re left guessing and you’ll never know when that direct mail piece has run its course and when is it time for another one. We were looking at some of our radio commercials. The phones were ringing, we were moving all these different types of products and getting a lot of people to look at even podcasts from certain radio spots. Lo and behold, I was looking at it, but I had never stood back, looked at it and graphed it quarterly or semiannually.
When I went back to January, where we were dropping about 1.5% a week and it was such a consistent drop. I basically called our broker, he said, “Yes, that’s typical ad fatigue, time to change out some ad spots.” We changed some ad spots. We’re skyrocketing again. The only reason I saw that, I didn’t just look at the numbers because all the numbers were in the thousands of people a day going to our website, 1,100, 1,300 and 1,200. You couldn’t tell that we were slipping, but when I graphed it, those Key Performance Indicators, that KPI graph showed such a story that I would never have seen if I just looked at the numbers on an Excel spreadsheet. I’m urging everybody reading, if you have a critical part of your company. How about daily sales? How about monthly sales, weekly sales? How about daily net profit? How about anything that leads to sales? Those are key performance indicators. How many times did your phone ring a day? That’s a KPI. How many inbound emails do you get a day? That’s a KPI. How many people put something into a shopping cart but don’t buy it? That’s a KPI. Everything should be tracked numerically, moved into a spreadsheet and graphed. I promise you, when you actually do this as a discipline, the world opens up for you. I hope this helps. Take care.