Typically defined as: ‘the accomplishment of an aim or purpose.’ (1)
Success means a lot of different things to different people. Success may mean wealth, or it may mean happiness. It may mean fame, and for others it may mean power. But can revenue be a true predictor of success?
In the business world there is not right or wrong way to define success. It’s merely subjective. It is based on both the personal and the business goals that you have in place for yourself. These can vary tremendously from one person to the next. Many believe that there is in fact only one path to success, and they simply choose not to consider other patterns of thinking. In their mind, this way of thinking is what will help them to reach their end goal.
It’s all in your ability to adopt change when it comes to your current systems and process, that will help you as you carve out your route to business success. If you begin to place too much confidence in your ability to make good judgements and decisions and solely rely on old patterns of thinking, you’re giving no weight to the environmental factors surrounding you that are constantly changing.
As we all know, the costs that typically make up a business are:
- Your fixed Costs
- Your variable Costs
- Your employee Costs
And then you have your little shining beacon. Your profit.
Ask yourself. Are you measuring the right things? Many have the perception that they know what makes up the correct monetary equation to predict their profit. We believe this is a naive way of thinking unless you’re consistently taking into account the effects of both your controllable and uncontrollable costs. Unless you are 150% sure your decisions are supporting your overall goal for profitability – there will never be complete accuracy in your figures. What you are measuring needs to show:
- Continuity in accuracy
- And, the numbers need to hold the correct weight.
It’s like being the coach of a sports team. You’re employed to pick players based on their skills and their ability to play within the team. There needs to be continuity in accuracy and you must weigh up the importance of the correct statistics. What abilities are most relevant based on the current game and competition. The environmental factors.
So there you have it. Revenue can be a predictor of your success. If you choose to measure it correctly.