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When pharmacy owners or managers are asked about their pharmacy’s business performance the answers are often focused around three things: prescription items, sales and turnover. Whilst these might be important numbers, they are not particularly helpful in understanding the business properly.
Firstly, they are very broad numbers and whilst precise in themselves, they are also vague because of their general nature. Secondly, they are not really performance but rather activity. If you spoke to an athlete, the distance they run around the track is not really important; that is their activity. What is important to them is the time they take to cover the distance.
These measures are like the distance run. What is more important in terms of business performance is the profit that is made.
A business with a turnover of £100k and a net profit of 75% is preferable to one with a turnover of £500k and a net profit of 10%.
Without useful information about business performance, we cannot make effective business plans. We need to avoid confusing management data with management information.
Data is raw information, similar to those measures listed above. Information processes data to make it more useable. Increasing the granularity of the information will give it more meaning and allow it to be more useful.