Daily Flash Report
This article will help you to develop or enhance your daily flash report that displays one metric that measures your company’s daily production.
Phil’s Profit Points™ in Brief:
A daily flash report helps to focus everyone on the most important activity that drives business results and displays the performance measure daily.
The daily metric should be operational, such as units of production or sales.
Everyone should know the metric and how their job contributes to it.
The daily flash should be posted internally for all employees to see everyday.
Think of a scoreboard at a football or hockey game.
What do your employees do every day? Do they fix your customer’s equipment, treat patients, give advice, manufacture products, build houses or sell donuts? How many of these did your business produce yesterday? That’s a very serious question.
Production Table: Units of Production e.g. square feet, service calls, billable hours, number of customers, any measurable activity that is important to your business.
A basic production table that measures your key output can help everyone to keep score and focus on generating results for your customers…and you.
If you don’t know how many hours you billed or square feet of stuff that you produced yesterday, then it’s very difficult to improve business results. That’s why, even as kids, we kept score when playing street hockey. People love to know the score. It gives them feedback on their performance, doesn’t cost management time, and a group can self-correct and improve performance if it is empowered. But they need real information to do that.
Trying to grow the business from last month’s financial statements, which could take a couple of weeks (or longer) to produce, is very difficult. The best businesses have real time information displayed for everyone to see.
Alignment
One of my favorite stories is from the airline industry. British Airways monitored any flight more than two hours late. If that happened, the manager would get a call from the CEO. That’s right, the CEO!
That daily flash report carried a lot of weight, motivated managers to act, and aligned everyone’s activities to get planes out on time.
Are your employees aligned? Ask them how they measure their daily performance. You may get some interesting answers. Crossing things off the to-do list probably isn’t an effective factor in aligning the front line with your business strategy.
Responding to a customer's complaint – and resolving it – within two hours would definitely support your strategy of being a highly responsive organization.
Here are some examples of daily metrics:
A window and door company measures how many units are installed each day.
A convenience store measures the number of customers (and average transaction volume).
A construction company measures the work done against the project plan.
An industrial company measures its safety index.
A distribution company measures the volume of products shipped.
A retailer measures dollar sales.
An accountant measures the number of tax returns prepared.
A doctor’s office or emergency room measures the number of patients treated.
A school measures daily attendance (unfortunately, this isn’t the key learning metric).
Our neighborhood measures the number of pot-holes still remaining on our street.
Our dog, Lola, measures the number of squirrels that she’s chased.
As parents, we measure how many times we have to ask our kids to practice the piano (usually once) and clean their rooms (usually a lot more than once).
When I’m asked to help a business improve financial results, the first place we start is to monitor daily production. By producing more, you can sell more. If you sell more (and at higher margins) and get paid faster, you’ll improve financial results dramatically.
Measuring and sharing the daily production numbers is a very low cost and high impact management practice that can dramatically increase your profits, business value and wealth.
Tough Question
What single metric has the power to align your entire organization?
From the Piggy Bank
Writing the daily production number on the wall – for all to see – has the great motivating benefit of having everyone try to beat yesterday’s number.
Have a profitable week!
