I love the disclaimer that “past performance is not necessarily an indicator of future gain” that is often affixed to advice or information from investment houses. Because it’s just that, a disclaimer. I get a chuckle out of it. The goal of most business owners is to do the opposite. To find a way to integrate lessons learned into their business models and build positive momentum towards future gains. And yes, if you find a way to do that consistently then everyone does come along – customers, investors, and the best talent – regardless of the disclaimer.
January is often the season of business performance reviews and annual sales kickoffs. More often than not focused on what it means to move forward rather than looking at the past. This is usually designed this way because the intention is to motivate staff to bring in those future gains. In the case of sales kickoffs, it can be more about setting sales targets rather than sales enablement.
For Startups a regular review is even more important and not just performed annually. But the review needs to be relevant. It needs to be about moving forward while building on a base of the previous period. If as a founder you don’t do a relevant review then you risk repeating the problems of the past, or worse yet carrying forward a momentum of poor performance.
If a Startup has incorporated the lean Startup philosophy of the build-measure-learn loop into its company DNA, then it will regard this regular business review from the same point of view. I love how Eric Ries divides The Lean Startup into sections called Vision, Steer and Accelerate because in business terms this is what is wanted. The review is where you Steer.
In fact, I would like to borrow a concept from Project Management, where the project and program executive review team is often called the Steering committee. Multi-million dollar projects and programs often have steering meetings where they review project performance in terms of goals, financials, approve major changes, decide actions to remove any roadblocks, and make executive decisions on how to move forward.
Before kicking off the year with your employees and sales staff, hold a Steering meeting to review, capture lessons learned, set new goals and make planning decisions. As a founder or co-founder, do this even if it is just with yourself. Better yet, pull in trusted advisors. Create a planned format or agenda for the meeting. Decide what financial figures or metrics you think are most relevant to periodically look at to see trends. Know what decision criteria you will use to evaluate needed adjustments and new steps.
The point is that new knowledge needs to be continuously integrated into what you are currently doing. The best way to do that is to periodically step out of the fire, check how you are doing, and make adjustments. The more this is a planned, regular, and repeatable activity, then the more benefits you will glean from the exercise.
Please feel free to share in comments about your own experience. Do you do regular business reviews? What do you measure? How do you apply the lessons you learn? Do you find this is a benefit to your business?