In 1996, in the movie Jerry McGuire, actor Cuba Gooding, Jr. made famous the phrase “Show Me the Money!” Ten years later, a variation of that command, now “Show Me the Data!” rings in conference rooms throughout the country. Managers far and wide, at least the successful ones, are looking at the data. Don’t tell me your opinion, show me the data. Can you back it up with data?

If you can’t measure it, you can’t manage it. Companies may be able to survive for a while if managers aren’t using data to make decisions, but they will eventually see their demise or fail to reach any semblance of their true potential; likely sooner than later. The companies to benchmark off are the ones who are not only surviving, but thriving! Pick your favorite phrase: TQM, Process Management, Quality Circles, Improvement Teams, Standards and Measurement departments or any other title you prefer. The function is the same. Look at baseline data in percentages, dollars, hours, or quantities and continuously monitor the performance.

There should not be any task that a supervisor or staff member performs that cannot be measured. If you can’t measure it, you can’t manage it. Take a fast food restaurant for example. There are a plethora of areas that can be measured such as days without an accident, customer wait time in line, length of time burgers are in the warmer, amount of money off in the drawers, customer complaints, etc. Graph it out and keep a spread sheet of your figures. Clearly, you’re looking for improvement. If there was a decline, brainstorm, find the root cause and then fix the problem.

The process is the same no matter what industry you’re managing. Whether you manufacture widgets, if you are the CEO of an internet marketing firm, if you sell cookies, or own a dental practice, take a look at all the steps involved in day to day operations. Assign values to the process. Set goals. Review the results on a daily, weekly or monthly basis. Remember, if you can’t measure it, you can’t mange it. Charts and graphs are an excellent tool to visually remind you of where you have been and where you plan to go.

In the midst of measuring your subordinates’ performance, don’t neglect to measure and manage your own operations. Don’t think for a minute that you are the boss and don’t need to look at your own data. If you’re the top dog, you had better be managing yourself, or you will never succeed at managing others.

I began this idea of management by statistics when I went through my training with MGE Management Experts. At first I received some push back from employees not wanting the additional work. Now, 4 years later, my staff has seen the benefits and the amazing results that tracking these numbers can bring to one’s position.

Typically, when we speak of metrics you will immediately think of things like KPIs, Production, Collections, NPs, and the like. But management by statistics goes much deeper than that. We look at things like overhead numbers and VFPs (valuable final product, which is the product that each employee produces in their given role) for each employee. These statistics are tracked and charted. But just tracking and charting them is only part of the equation. One must also be able to manage them by applying formulas and policies to either turn around a down stat or help bolster an up stat. These steps are not intuitive but are learned, and we will continue to cover them in future blogs. Keep your eyes out for future posts.