Personal New Year's Resolutions Aren’t the Only Ones That Fail Why Your Business Goals Won’t Work At the end of the year, entrepreneurs sit down to develop their goals for the new year. They craft specific objectives based on best practices they learned from other leaders, implementing S.M.A.R.T. goals or strategic plans to give their company a clear path to success. But every year, perfectly crafted benchmarks fall by the wayside and join weight loss on the scrap heap of New Year’s resolutions. Owners scratch their heads wondering why they didn’t reach their target, not understanding the root cause of their failure. You can have the most carefully planned- out goals, but if you haven’t built a foundation on these three concepts, you’ll never achieve them. Organization Nothing derails a goal faster than ineffective systems and processes. Procedures aren’t dynamic, so as your business changes, an audit of processes isn’t just useful; it’s necessary. But as your business must continue to improve its organization in order to adapt to change, so do your team members. At the root of every system is an employee, so without teaching basic principles of time management and prioritization, those systems are limited in their capacity and effectiveness. Communication Negative external and internal relations are surefire goal- killers. Internally, the success of your company is dependent on the dynamics between team members, management, and leaders. Complacency and gossip tend to spread like wildfire and can cause a dip in productivity. External communication between partners and potential clients is very similar. Without clear expectations and mutual respect in relationships, your business will cease to scale. Customer Service Clients need to feel valued to have a future with your business, and that’s rooted in every interaction. Customer service is a broad term that is often miscategorized. In truth, every role is based on customer service, but many people go about it wrong by taking on the attitude of “It’s not my job.” Lack of ownership and willingness to serve customers in every capacity will undermine any long-term objectives your company may have. The good news is that with proper execution of these three concepts, you can focus on attaining your goals, and in the process, achieve levels of success you previously thought impossible. Don’t let your objectives for the new year fall by the wayside. Achieve those goals by rooting your business in organization, communication, and customer service.
Satisfied With Last Year’s Performance? Are You Sure You Should Be? Calculate Customer Churn — And Learn How to Reduce It in 2019
You’re looking over last year’s numbers, feeling pretty satisfied about the results for 2018. Production increased and you have a lot to feel proud of overall. But what about those customers or subscribers who said goodbye to you in 2018? If you haven’t yet calculated your end-of-year churn, you should feel a little less comfortable. Looking at that churn rate is key to your business’s success. Most business owners say that if they could change one thing about their business, it would be their customer churn rate. Retention is key to success because it almost always costs less to retain a client than it does to attract a new one. Increasing client retention and reducing churn in the coming year can only happen if you know what your churn rate was last year. Calculating Churn It’s not rocket science! One of the most straightforward ways to express yearly churn is to calculate it as a percentage of customers lost: Divide the number of customers you started with in 2018 by the number of customers you lost in 2018. Churn can also be measured by the value of recurring business lost or as a percentage of recurring value lost. Choose the measurement that makes the most sense for your business. Why is this number so important? Think about it this way: Beyond representing how many customers flew the coop in 2018, churn represents an exponential loss of profit. Each year those lost clients don’t do business with you, you lose a year’s worth of potential revenue. By tracking customer churn throughout the year — ideally quarterly — in addition to end-of-year churn, you’ll begin to notice trends that you can address. Does the highest churn always happen in the third quarter? Did you sell more subscriptions in 2018 but lose more longtime customers in the course of chasing those leads? Noticing how these threads lead back to your losses is the first step in decreasing your churn rate. Of course, it’s impossible to calculate your customer churn if you haven’t been tracking and measuring it throughout the year. If you haven’t, you now have the opportunity to do so for the coming year. Add monitoring these numbers to your resolutions for 2019.
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