Numbers that are tracked and reported are numbers that grow. How does your business measure up?
The Rich Dad Company has been growing rapidly. While I'm grateful for the growth, one recurring problem has been that each department had different priorities and different measurements of success, which meant the company was growing rapidly in different directions. To refocus the business, I had to find a single aspect we could all track and measure--and have fun doing it. We decided to measure the number of customers who play our Cashflow board game each week.
Every Tuesday morning, the Florida and Utah offices call in to a videoconference. The first item on the agenda is the same question every week: "How many people played the Cashflow game?"
The reason for focusing on and measuring this is because I want the company to focus on the number of people we're serving--which is more important than how much money we're making. I believe that our income increases when our services to our customers increase. That's why our unified company focus is on how many people have fun learning and playing with our educational game.
At first, the reporting was awkward and the numbers weren't always accurate. But over the past year, the reporting has become much more precise. On top of that, a competition has emerged between our three offices over who reports the highest numbers. Slowly but surely, the numbers have steadily increased--and so have the creative ideas on how to keep the numbers increasing. The net result: a company focused on happy customers who have come to us to learn and grow.
I got this idea from the Hawthorne Effect, which was tested in the 1930s. Simply put, the Hawthorne Effect found that when something is measured, it improves--and when something is measured and reported, it improves exponentially. As a result of measuring and reporting weekly, the number of people playing our game was increasing and, after a year, beginning to increase exponentially. At first, the numbers from each office ranged from the 20s to a high of 200. Today, the numbers are in the thousands. Who knows where it'll be this time next year?
The next project we're considering measuring is the health of our team. Poor health is hurting workers, and health-care costs are killing many businesses. We haven't yet worked out the details, but I'm considering measuring weight, blood pressure, cholesterol and other indicators of health on a bimonthly basis. To supplement this measurement, a health and fitness coach will be brought in to support our employees' health education. By measuring how well we serve our customers and how we care for our team's health, we'll be able to build a healthier, wealthier business. These measurements don't show up on our financial statements, but they will greatly affect our top and bottom lines.
Robert Kiyosaki (richdad.com), author of the Rich Dad series of books, is an investor, entrepreneur and educator whose perspectives have changed the way people think about money and investing.
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