By Charlotte Kemp

When you have mastered numbers, you will in fact no longer be reading numbers, any more than you read words when reading books You will be reading meanings. Harold Geneen

When I was in the process of trying to sell the business, I encountered one potential buyer who totally intimidated me. He was not overly impressed with my marketing ideas nor my assurances of how important the business was and how disappointed the clientele would be if we closed down – which they were. He wanted to know numbers. What I did appreciate was that he didn’t want to know the numbers accountants wanted to know (and I apologize to all my accounting friends). Accountants look at a business completely objectively and without passion. In my experience they could not see any potential marketing opportunities or avenues and in fact did not even want to see the premises. But this man was there – checking out the equipment, staff, mall etc, and asking questions involving numbers:

How many clients a day?

What is their average spend?

How many clients in the shopping centre?

What is our overall profit margin?

How much do we make on average – a day, week, month?

Which is our highest turnover product?

Which is the most profitable product?

Why is that line so expensive to run?

I could not answer his questions. And then he pulled out a calculator, took the figures we eventually pulled together, and told me that I should be taking home some decent figure each month. Well, not only was I disappointed that I was not taking it home, but I was ashamed that I could not work that out myself, and that I didn’t have those figures at my fingertips to start with.

Do you recall the TV series, The District that portrayed Chief of Police Jack Mannion who comes in to clean up crime? One of the changes Mannion makes right up front, is to insist on complete and accurate data from all the police stations in the district. These are plotted on a computer program and projected on a huge wall. Every day he meets with the station commanders and is able to question them specifically on crimes committed in their jurisdictions based on his up to date information. His oversized data dashboard and insistence on following up with the people responsible for reducing crime made him very effective, although not warmly loved.

Now that is how we should be with our businesses. You can imagine Mannion’s crime dashboard displaying all the statistics across town, or perhaps a hospital emergency room’s bank of computers, beeping and chirping with life signs that doctors and nurses are trained to understand and respond to. But either way, we should have that data at our command in order to keep danger away or keep our business alive.

Sometimes we avoid the numbers because they are too scary. However, if you do not know how profitable your various product lines are, or how expensive a new piece of equipment or a new staff member is going to be, then you are putting yourself at risk. Just like with my store, you may be paying other people for the privilege of being in business while you are busy bankrupting yourself.