Channelpro | Peer To Peer Article

Keys To Business Success

Profile: Michael Cocanower
Founder and President
itSynergy

Location: Phoenix
Established: 1997

Number of employees: 10

Company focus: Providing network
infrastructure services and turnkey
solutions for SMBs, as well as application
development primarily for
the residential construction industry

Favorite part of my job: The rush
that I get from aggressively pursuing
growth and building something
that helps to achieve that goal

Least favorite part of my job:
When things don’t work the way
they’re supposed to

Words of wisdom: Remember that
you’re running a business, not an
engineering shop.

ANYONE WHO KNOWS ME will tell you that I’m a big metrics guy. I love to measure things, look at them objectively, put them in graphs, and compare present to past. Because of that, I developed strong feelings about key performance indicators (KPIs) and how important they are for running a business.

When I started the company, I didn’t know much about managing a business. I knew a lot of technical stuff and how to write software, but I didn’t know about running a company. Everything I did from a business management standpoint was reactive. I wouldn’t find out how much money I made for the year until April when the tax returns were done, for example. I would look at the return and say, “Wow, last year was a good year,” or “Oh, last year was a really cruddy year.” I was constantly finding out about things after the fact. And that woke me up to key performance indicators and what they can do for you.

A KPI is a metric of your business that tells you how it’s doing, positively or negatively, and enough in advance of the trend to enable you to actively interpret and react to the information.

So when I found out how my year was in April, it was too late to do anything about it. Now with the KPIs I try to achieve a strategic view of my business, digging into the data and finding out what made certain things happen.

Now, instead of looking at the end result, I back it up four, five, or even 10 steps and figure out what was done on the leading edge that ultimately went through those four, five, or 10 steps and made it a profitable year. Were the deals we were working on larger than the deals we were working on in previous years? Did we do more deals, or were we selling different types of services? Was our service blend different between infrastructure and software development?

You can narrow your business down to five or 10 key things that you can measure on a regular basis that tell you how you’re doing long before the results are “official.”

Everyone’s key performance indicators will be a little bit different, of course, depending on the business. We don’t sell hardware, for example, so we don’t need to look at hardware margins. But take a look at our company’s KPIs as an example, then look at your own business and identify an event that was positive— customer satisfaction up, great month, great year–and then find out what caused it. great year—and then find out what caused it.