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Walk in to any one of the more than 100 GoodLife Fitness Clubs across the country, and you're almost guaranteed to see members making careful notations on their personal charts about how many chest presses they've done, how many pounds they've curled, and how many crunches they've just squeezed out.

Modern fitness training is a sophisticated business, and getting the right results means following a carefully crafted regime.

If you want to lose pounds and gain six-pack abs, you have to know where you're at today, where you want to get to, and how you plan on getting there.

But that's not enough. You have to track your progress, quickly spy any unusual or undesired results, and modify your program, if your gym time is going to pay off.

It's similar thinking that, at GoodLife's headquarters in London, Ont., has Pat Jacklin constantly going through key numbers. It's what you would expect from the CFO of the fast-growing 27-year-old business.

Many small- and medium-sized businesses can learn from the way GoodLife tracks its business. Because for this company, it's not just what numbers are tracked: it's also why they're tracked.

From it's founding in 1979, GoodLife realized that "setting goals and achieving results was fundamental to success," says Ms. Jacklin. To do that, the company relies heavily on a handful of key performance measurements.

Some of the key metrics it looks at are sales goals, retention of members, and expenses and revenues within each manager's control. "These are the key underlying numbers that help keep the company on track," she says.

What GoodLife is practising is performance measurement, the tracking of key metrics that best reflect how well and how quickly a company is advancing towards its targets.

Performance measurement is also a valuable tool in quickly spotlighting problem areas that could hamper that progress, as well as a key component of successful employee rewards programs.

"You get continual feedback and you can modify your approach within an ever-changing business environment," says Howard Johnson, the head of CMA Ontario.

Despite its benefits, however, companies like GoodLife that use performance measurement are in the minority among other small and medium-sized enterprises.

A study by PricewaterhouseCoopers LLP found that only 43 per cent of the companies it surveyed set financial targets in order to measure business performance.

The study, entitled "The 2006 Survey of Canadian Private Companies" found that "while companies create business plans and strategies, many of them are not setting targets or establishing metrics."

"It's being talked about, but implementation is still in its infancy," Mr. Johnson says.

While some SMBs do track numbers, it's what they do -- or don't do -- with them that's the problem. Often companies don't link their metrics back to their strategy or business plan, or the budgetary process," says Philip Townsend, an advisory services partner with PwC. That linkage is critical, he says, since "The key is to understand the things you must do well to succeed."

A lot of the potential metrics companies can use are employee-specific.

They can include financial measurements such as revenue and profit per employee, or measures of employee satisfaction such as retention and turnover.

Using performance measurements can also be a critical part of retaining and rewarding staff. A key corporate challenge these days is to attract the best and brightest, Mr. Townsend says: "[People] want to work for organizations that have a clear sense of where they are going and how they are going to get there."

That's something that GoodLife takes very seriously. In addition to monitoring its employee retention, it also recognizes and rewards employees that excel. "Everything is based on competitive and visible performance metrics," Ms. Jacklin says.

One of the most valuable applications of performance measurement, he says, is helping owner-operators take their business to the next level.

"One of the challenges they have is they hit a ceiling. Owner-operators tend to keep control and they can do that, but only up to a point," says Mr. Johnson.

"To break out and create value they need a more formal management structure, and performance measurement is an essential component."

Mergers and acquisitions are another area in which SMBs could benefit in a big way from performance measurement, he argues, with metrics being used to assess how the integration process is faring.

For example, customer retention, employee retention, and even the cost of combining two different technological structures could be used to give continuing feedback on how well the process is being managed.

Its proponents also argue that performance measurement can also streamline managing a division or an entire business.

"One of the key benefits is that performance management helps you focus on the handful of numbers that truly drive the value in any business," says Mr. Johnson. "Often people try to manage in too much detail."

Finding the right numbers to collect, and knowing what to do with them is what performance measurement is all about, agrees Ms. Jacklin.

One of GoodLife's key metrics is client retention. If a particular club's numbers start to wane, she says, "we'll survey members and send people in and change how we do business and take the steps needed to satisfy them."

Monitoring SMBs

26%

Number of owners who use pen-and-paper and ledgers to keep accounts

74%

Number of small business owners who say "word of mouth" is their main marketing method

36%

Number of owners who say they spend too much time finding new customers