Reference no: EM133616921

Question: "Business metrics are quantifiable measures used to track business processes to judge the performance level of your business" (Luther, 2022). Typically, the metrics are broken up into the departments (like manufacturing, marketing & sales, etc) and they are responsible for monitoring what tracks the performance of their department. Higher up executives are then responsible for more of the general metrics.

There are tons of metrics that a company should track. The sales department should look at net sales revenue, quota attainment, growth rate, churn rate, lead response, and more. The marketing department should look at return on marketing investment (ROMI), cost per lead (CPL), customer acquisition cost (CAC), customer lifetime value (CLV), customer retention, etc. The financial department should look at net income, net profit margin, gross profit margin, current ratio, working capital, etc.

Quota attainment looks at the performance of sales teams & individual sales reps by tracking how they meet their selling targets. This information helps managers know how they're doing, and who needs to improve. It also provides a baseline of information in case they're wanting to increase the number of reps that reach the quota or help them see which regions or markets they should ramp up sales.
Customer retention metrics look at how well the business retains customers & how satisfied those customers are. This also provides information on how costly it might be to acquire new customers.

Working capital metrics look at how much cash the company has on hand. This metric helps a company ensure its meeting short-term needs but isn't wasting investment opportunities by having too much cash.