Driving is second nature to us, isn’t it? We check our instruments constantly and make adjustments without even thinking. We should drive our businesses the same way. Drivers use five main indicators to get where they’re going. Entrepreneurs need to use the same five indicators to be successful:
1. Fuel Gauge
We check our fuel gauge often because it sucks to be stranded. We check it as soon as we start our car and we check it often during our trip. We feel comfortable when we’ve got enough fuel; we feel anxious when we’re not sure if we can make it to the next station.
As entrepreneurs, we check our bank account and, as we get more sophisticated, our balance sheet. We don’t want to run out of cash because that sucks too.
Our tach gives us a sense of our fuel consumption. The higher the revs, the more fuel is being used. We automatically adjust by shifting gears to drop our revs.
Entrepreneurs must know their burn rate. How much cash is being used week by week? Month by month? And if the burn rate is too high we must quickly adjust it before the fuel gauge light comes on.
by Alex Glassey @stratpad Read more here.