• You’re the boss. Give Yourself a Performance Review.

    in Small Business Management on May 13, 2020

    One of the perks of owning your own business is no more performance evaluations, right?! Sure, except one of the best ways to grow your business is to understand and evaluate your own performance. Human potential thought leader, Bryant McGill rightly says, “People who have had little self-reflection live life in a huge reality blind-spot.” By conducting a self-assessment, the type of business opportunities that you should and should not pursue becomes clearer. While some may argue that it’s impossible for bosses to be objective about their own performance, data doesn’t lie. So, in this blog post, we will propose some ways to self-evaluate that are tied to information that you should have on hand.

    CHECK YOUR GOALS

    For this part of your assessment, you will rate yourself according to the goals you set the previous year. Pull out last year’s one-year plan. In it, you should have captured some goals such as:

    1. Annual Revenue. You should be setting a revenue goal at least every year, if not quarterly. Depending on how long you have been in business, you may want to use different approaches. If you have historical data, you may wish to add a percentage onto last year’s numbers. For example, if last year’s revenue was $100,000, and you want to grow it by 25 percent, your new annual goal would be $125,000. If you are starting at zero, you may want to consider using a capacity-based model. There are only 24 hours in each day, and you only work billable hours a certain percentage of the time, so using this approach, you can be sure that you are realistic about your current ability to generate more revenue. You may simply need to hire another person to achieve the higher number.
    2. Profit. By having a profit goal, you are forced to not only think about bringing in more revenue, but you also will be more attuned to managing your expenses. If you want to really focus on the expense side, consider using zero-based budgeting. With this method of budgeting, every expense is scrutinized and assessed regardless of whether it was justified in the previous period or not. While it can be time consuming to perform such an analysis, it can also mean the difference between staying in business and going out of business in times of economic downturn. As published by global consulting group BCG, UK consumer goods company, Reckitt Benckiser adopted zero-based budgeting during the last economic recession, and “despite anemic growth in household products, the company achieved organic top-line growth of 10% in 2008.”
    3. Other numbers. You should have a number of other goals each year. For example, the number of employees, customers, Google reviews and/or new products are all goals that you can set and measure because they are undeniably objective. Either you hit the numbers, or not. 

     

    GRADE YOUR GOALS

    While you can easily see if you achieved your exact numbers, measuring your performance against number-based goals still requires establishing a rating system to be objective. If you are consistent with your rating system year over year, then you can more easily spot trends and take steps to improve your performance.

    Most people are familiar with the 0-100 percent grading system, where 90 to 100 percent is an “A,” 80-89 percent is a “B” and so on. For our example, we’ll use the grading system to rate our performance. Last year’s goal was 100 new customers. We got 80 new customers. To get our “grade” percentage, we simply take our actual achieved number divided by our goal number, then multiply by 100 (to get the percent). In other words, 80 customers/100 customers x 100 = 80 percent. So for the goal of 100 customers, we get a “B.”

    CHECK AND ASSESS YOUR JOB DUTIES

    Believe it or not, it’s even possible to rate yourself rather objectively on what you’re good at and what you love doing. Instead of giving yourself a grade, this time, you will be assessing which categories that your duties fall into. First, take all of your duties and responsibilities and create four numbered lists:

    1. All the duties that you really like and are really good at. You are most efficient when you both like and are good at what you do. These are the tasks that make the best use of your time. The majority of your job duties should be on this list. Make it your goal to have 80 percent of the things you do fall into this category.
    2. All the duties that you really dislike but are really good at. It’s great that you are good at more things than just the ones you like. However, if you don’t really like doing them, you will often put them off. Instead, be the back-up person for these tasks and get an intern, significant other, friend or employee to help you. These tasks should be limited to 15 percent of your time.
    3. All the duties that you really dislike and aren’t that good at. It probably wouldn’t be too hard to convince you not to do these things, but perhaps you feel like these are ultimately your responsibilities. They are actually a waste of your time, and you could likely outsource or hire someone else to do them more effectively and efficiently. You should be spending no time on these tasks.
    4. All the duties that you really like but aren’t that good at. For example, let’s say you like making videos, but they take away from other important duties. No matter how great the videos turn out, they are distracting you. You should not spend any time on these tasks.

     

    SELF-ASSESSMENT TIPS

    • As you conduct your self-evaluation, take notes of your successes and how you may build on them.
    • Ask yourself and note what you would have done differently in the previous year.
    • Don’t be too hard on yourself. The goal is not instant perfection. It’s to improve over time.
    • Recognize your mistakes as learning opportunities, a path to improvement. Test, tweak, rinse, repeat.
    • Use technology to help you improve. For an extensive list of small business resources, download our free eBook, The Definitive List of Small Business Resources & Tools.

    Celebrated, winning coach John Wooden said, “Without proper self-evaluation, failure is inevitable.” We don’t have the audacity to question a coach who won 10 NCAA championships in 12 years. But even if we did, we would still agree with this quote. Assessing your own performance reminds you of your plans, hopes and aspirations, which is exactly what you need to realign yourself with your goals. You’re the boss. Give yourself a review today.