Failure to confirm the results of your actions through leading and lagging metrics is akin to walking through your house at night in the dark.  You are much more likely to hurt yourself walking into something you don’t see that could have been easily avoided if you had turned on the lights so you could see better.

Confirming the results of your business actions through your financial statements and scoreboards is how you protect your business from making costly mistakes by knowing what’s working and what isn’t in your business.

Overview

Your profit plan is only as good as the accurate and timely monitoring of your actual monthly results against your planned results.  This is the only way to know where your business is comfortably exceeding your expectations so that you can fix any areas where your business is performing less optimally.

Confirming the quality of your actual month-to-month Gross and Operating Profits against your planned sales and profits is the only way to know where you are tracking better than planned and where you aren’t.  Knowing this information allows you to confidently focus on fixing the areas that are worse than the plan.