Numbers run a business. If you don’t know your numbers then you aren’t really running a business. Knowing your numbers takes on even greater significance as we navigate the current recession.

These are the numbers I consider critical for my weekly consideration. My list is deliberately short – I can’t handle much info especially when it comes to numbers.

I need to know the number of files we’ve opened year-to-date and the number of files we’ve closed year-to-date. If these numbers grow apart I know we’re headed for trouble. One of my early family law mentors developed an analogy that worked for me. He explained that a family law practice is like a big toilet. New stuff comes in and old stuff goes out. If the balance gets out of whack then the system gets clogged. These numbers reveal when the balance is getting out of whack.

I need to know our average client satisfaction score for the month-to-date. We survey all clients as we close their files. I want to know how we’re scoring on those surveys. I’ve found that our client satisfaction score is a key leading indicator for our overall financial performance.

Finally, I want to know our average number of days to close the files closed so far this month. We look at each file closed so far this month and count the number of days it was open. Then we average this number for all files closed, so far, this month. I find that the longer it takes to close a file the lower our client satisfaction score tends to be. I keep a close eye on this number and use it to make staffing decisions. If we are running longer than usual to close files then I know we’re going to see a lower client satisfaction score and I want to act to head off that possibility.

Of course, I also look at cash, revenues, expenses and profit. If I ran a practice that had receivables I’d be paying attention to that number as well.

Certainly I look at other numbers each month but these are the basics. If you aren’t getting this data then it may be time to start.