Business Forum: Diagnosing Your Business

To measure a person’s physical health, physicians use certain standards — proper weight, cholesterol count, lung capacity, and the like. Without ever seeing the patient, a doctor can predict health and longevity based simply on the numbers. Similarly, you can track the health of your business using what I call baseline numbers. And just as a physician may prescribe a workout to help you lose weight, you can use your baseline numbers to diagnose business problems and decide on a course that will improve your company’s performance. What Are the Baseline Numbers? Many builders already monitor the financial performance of individual jobs by comparing actual job costs to estimated costs in categories such as foundation, framing, finish carpentry, and so on.