Ethics the true measure of your company: it can't be plotted on a month-to-month graph, but your firm's integrity should be in good supply.

THE PRIMARY REASON that we all design, fabricate and develop technology that becomes printed circuit boards is to make a profit and increase the value of our investment of time and treasure. But how do you measure success? What measurements best indicate that you have achieved your goal and that value is being increased?

For many, the best measurements are of profitability, cash flow and shareholder equity. All three of these measurements have proven the test of time, and they can often level the playing field between the smallest and largest companies. In 1990 1 asked a friend--a one-man distributor of machine tools--how his company was doing. He said, "I never thought I would say this, but my little company made more money this year than General Motors did! Then again, GM lost a couple of billion and I didn't."

While I agree wholeheartedly that the basics of good cash management, attention to the bottom line and focus on the balance sheet are important for every company there is one additional measurement that is equally, important if not more so: business ethics--the integrity that your company earns in the marketplace. There are three main reasons I rank business ethics as highly as the classical financial measurements--capability, reliability and value.

When you boil everything down to a common denominator, people who design and fabricate printed circuit boards are selling their capability. Success is matching that capability with customer needs. And when customers check you out, what they need to know above all else is whether you can get the job done. Presentations and plant tours are great, but at the end of the day you are only as good as your reputation. If you have a lousy reputation, no matter how sophisticated your presentation, you may not do as well as the company with a marginal facility but excellent reputation for innovation and capability. Capability cannot be added quickly and the integrity your business earns for having excellent capability takes even longer to build.

Reliability is a long-term measure that all customers seek, regardless of industry. You can deliver the first order on time or provide the most innovative technological solution imaginable once, but that does not make you reliable. It takes consistently shipping quality product and innovative designs on time to create reliability. And it takes even longer for the marketplace to fully understand the dedication and integrity your company places on reliability. Again, all the talk in the world will mean nothing if your customers do not confirm that your business ethics and dealings are reliable.

Value is the real or perceived net effect of a company's capability and reliability. If you provide capability and reliability, you will typically be viewed as being a good value by your customers. Value will enable you to better match what you offer to customers who are looking for your strengths, if you value your capability and reliability. The marketplace knows, by word of mouth, the companies who have the reputation of providing value vs. the companies who don't.

And that's where it gets interesting. Much has been said about all the factors that have damaged the market for PCB design and fabrication. Everything from excess capacity to tough foreign competition to a weak post-9/11 economy has been thrown on the table as examples of why our industry is not what it could be. Little, however, has been said about the many companies that have either done themselves in or have beaten the trends because of how they have conducted business. Over the past several years many companies did not exercise good business ethics in regards to how they dealt with their customers, employees and suppliers.

Dealing with people honestly and fairly is only part of business integrity. It's just as important not to oversell your capabilities or overpromise your reliability. Business ethics is really your business integrity. Having integrity--a solid reputation for delivering capability, reliability and value--costs nothing and truly adds value. Begin to cut corners, overpromise or underperform and your reputation--integrity--begins to work against you.

On the other hand, over the past several years many companies have applied good business ethics to building their businesses. Some companies thrived in an otherwise difficult marketplace by focusing on providing cutting-edge capability and reliably delivering exceptional quality on-time. And they've done so the old fashioned way--by doing what they said they would do, not by overpromising. Those companies have earned reputations based on their integrity--their business ethics--and are now realizing the value of how they conduct business.

So to your other strategic measurements, add business ethics--integrity. Start looking at how you and your employees conduct business. Are you consistently providing top quality, on time and with great service? Does your company have a good or bad reputation in the local or national market, or none at all? These may be the best measures of how successful you and your company will be in any economic environment.

PETER BIGELOW is president and CEO of IMI (www.imipcb.com). He can be reached at [e-mail].