The Importance of Understand Your Baseline in Business


Do you ever feel like you’re throwing spaghetti at the wall to see what will stick in business? You want the company to grow. You want to hit your goals. And you know you need to make changes in order to get results, but you find yourself jumping from one thing to the next without a clear direction. Often, this comes down to not having a clear understanding of your baseline—AKA, your starting point.

No matter how hard you try, you can’t improve what you don’t measure.

Baseline 101

Your baseline is nothing more than where you are when you get serious about tracking progress. Let’s use sales as our example. You want to improve your sales, so you keep looking for new strategies to try. Maybe you hire a new salesperson or increase your marketing budget to get more attention to your products and services. But if you don’t know your sales numbers for last month or last quarter, how do you know if your changes are working?

You don’t, and that is why you need to start with documenting your baseline. This applies to any area where you want to improve and see progress. For example, how do you know if you’re saving money on materials if you don’t know what you used to spend? How do you know if you’re losing weight if you don’t know how much you weighed at the start? How do you know if you’re running faster if you don’t know how fast you used to run?

You need to document your current numbers.

There are many reasons why people don’t know their baseline numbers. A few examples include:

  • Lack of communication between people or departments
  • The embarrassment of knowing the numbers won’t be where they want them to be
  • Lack of a process for tracking numbers
  • No one in the company is assigned the responsibility of tracking

Take time to look at the different areas of your business and inventory if you know your baseline numbers or not. If you don’t, determine what stops you from having the information you need and then make the necessary corrections. Remember, you can’t know if you’re improving if you don’t know your starting point.

Set goals and create a plan

Once you know your baseline, it’s time to set goals. Now that you know your starting point, you can set more realistic goals for your company. If you need help setting goals, you can find additional information here.

Once you have goals established, create a plan to help you achieve your goals. Look at the tasks required to hit your goals. These are the tasks that need your time and attention. They are the tasks that will move the needle forward. But, you can’t stop here.

Analyze your progress with checkpoints

It’s important to build in specific periods to check on your progress. The time period you use for checkpoints will vary based on your business and what area you’re tracking, but you don’t want to put a plan in place and forget about it. You need to be intentional about pulling current numbers to compare them to the baseline. This allows you to see if your plan is working or not.

You know that your plan is working if you pull your numbers and see that things are improving compared to the baseline. But, if you look at the numbers and see things have stayed the same or even declined, you know it’s time to pivot because your current plan isn’t working. This doesn’t mean you need to scrap the entire plan and start over. You may just need to make slight adjustments to what you’re currently doing. Still, you won’t know unless you’re tracking your numbers and comparing them to the baseline.

Find resources to help

It can feel overwhelming as you start tracking, analyzing, and making adjustments to your plan, but there are many resources to help. For example, you could work with a business consultant that can lead you through the process. There are also tools, like the SPEARity app, that make it easier to see what’s working and where adjustments need to be made. You can schedule a demo here or speak with a business consultant here to get started.

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