It is often said that a good manager is one who can delegate effectively, rather than feel that they need to do everything themselves. One of the keys to good management, therefore, must be having a team that you believe in and trust to do a good job. So, if you have set up your system correctly and put the right people in the right roles with the right amount of motivation, direction and enthusiasm; all that you then need is a way of measuring the system.

The idea of having alerts or alarms operating within the business is that they are activated in real time. It amazes me that most business owners, even lots of really sizeable companies, do not know how they are performing until their accountant presents them with a set of year-end figures. Often this can be 12 to18 months later. How can you possibly deal with a problem that far in the past? My mind boggles at the thought.

The starting point for setting up alerts and alarms is to ensure that each member of staff knows what 100% looks like for them, in their role. This should not be a hardship or a ‘ruling with a rod of iron’ scenario, but simply an employee delivering exactly what is reasonably expected of them (100%) in return for 100% of their salary. A fair deal! When you add to this the precursor that they no longer see their role as merely a job, but as an important part of a joint vision which they have entered into, this is fairly straightforward. In fact, they will appreciate the support. The key here is the willingness to do it, not the having to do it.

If you have identified everybody’s 100% and you set up real-time (preferably daily) measurements to check that the target is being achieved, then you can see if there is an issue before it becomes a problem. It might just be a blip or a bad day, that you can choose to ignore or monitor for a while, but if you ‘don’t know’ then you are running blind. Things go wrong from time to time, the unexpected or unfortunate does happen, but if you have a robust system you can either work through it or make the necessary adjustments – instantly.

This isn’t simply a case of watching the financials either. It is far more powerful than that. Let’s look at some scenarios:

• Your sales and marketing team is now tasked with 150 calls per day, resulting in twelve meetings, resulting in five new orders. The Alarm: you know that if only 130 calls are made that you will not get your five orders and will miss your turnover target.
• Your delivery team with its apprentices and smoother operation, needs to deliver the right number of completed new products. The Alarm: you know that your invoice team cannot ask for payment without having a delivery date – this will affect cash flow and hold up investment – so you need to identify early if there is a problem with the delivery targets.
• Your finance team: with a clear invoice and payment collection strategy, the team must be diligent about the process or they will adversely affect the cash flow. The Alarm: you need to be alerted early if the process is not adhered to because cash flow shortages have a knock-on effect across the entire business.
• Your customer service team: your service expert has to send enough marketing and make enough calls to deliver their new 80% repeat order target and double the orders from those who didn’t order the first time. The Alarm: this will affect the whole new sales and ongoing revenue stream if it is not met – and mean that you cannot hit your turnover target.

In all of the scenarios above, you can set up systems to measure an individual’s performance and alert you to any shortfalls – instantly. With that information to hand, you have the power to decide: if it is a problem, if you are going to let it run for a few days, if there are extenuating circumstances, or if you need to take immediate action.

Without it you may be missing a massive pothole which could eventually destroy your business. Or you could simply wait for the missed targets, missed deliveries and lack of cash flow, then hold an inquest and make some redundancies.

Think of these measures as the dashboard of your car. You don’t need to shine a torch into the petrol tank to visually see how much fuel you have – you look at the little dial in front of you. Likewise, if a light comes on shaped like a bulb, it is likely that an indicator has stopped working, or worse still, one of your headlights. The warning light means you can go and investigate the problem. The alerts and alarms fitted to modern cars mean that you do not need to be an expert mechanic to identify what the problems are.

But here is the key point. The petrol and the lights on your car are all just playing their part in the delivery of the bigger picture. Each of the hundreds of functions in your car are all there for the same purpose – to aid you in getting you to the place that you are going, safely and comfortably. Some parts are more important than others at different times, in fact some are essential and others are mere luxuries, but they all have a role. Ignoring or removing vital measurements, like the petrol gauge, oil lights or tyre pressure alerts could cause you to arrive late – or not at all – ever.

That is why alerts are so important in your business. But they are also intrinsically linked to the actions which you take when the alarms go off….an article for another day!