Managing Your Business At a Glance

In order to properly manage your business and plan where you are going it is helpful to be closely in touch with what is going on. This includes looking at the numbers. Up to date accounts at least tell you where you are now.

planning is key, know the fundamentalsBut is that enough? I would suggest that in fact that is just the starting point. The thing is, you can have monthly accounts, and if you have a half decent accountant you will have some indication as to whether things are better or worse than last year and budget.

That is only half the story, if your profits are down, is that enough information? I would say not. You then need to ask why? Why are they down , what is the explanation? What is the detail?

For example, sales may actually be up, but some unexpected cost came in that wiped out the benefit and caused profit to be lower. So then you need to know what caused the extra cost, is it a one off, could it have been prevented and so on.

Do you start to see how digging a little deeper gives a much better understanding.

It’s worth asking your accountant to produce reports with notes that cover this sort of thing, so that when you review the figures all the information is there. Yes they may need to come to you first to ask for explanations, or the appropriate department in you company.

For example

Actual Budget Diff
Turnover £5,400 £4,500 £900 orders planned in September brought forward to July
Costs:
Training £300 £150 £150 Jane went on extra course to help improve our Social Media

           
     
It’s always good to use colour too, red for worse than expected and green for better than expected. Again it allows you to see at a glance, and just focus on the things that are off track.

Your most important financial information can easily be reported on ONE sheet of paper.

Taking this further there are also key factors that will drive your business underlying the sales and costs. It is worth measuring these too.

It may take a little bit of work to set up but the advantages of being able to see where your business is compared to the plan is very valuable. To do this we can use a Key Results Sheet.

This incorporates the key financial numbers for your business like profit, cash and value (if appropriate)

It then looks at some underlying factors, so for sales you might measure the number of new referrals, and the average spend per customer as examples. For costs maybe the cost per unit if you sell items in units, debtor days etc.
Also look at non financial drivers, like customer satisfaction and team happiness and how much investment there is in creating new products.

I believe if you combine this with a one page (max) financial summary you have a quick and easy view of all the data you need to manage your business month to month.

Maybe if it’s just you, you will think its too much, and too much work. If you are building a business, start as you means to go on, get the systems in now. You can always start with a simpler version and build it as you grow.

How does this relate to me working with you to be authentic in your business? Well my packages include a good look at your business foundation and fundamentals, giving you a grip of the reality as it is now, plus an overview of what you need to implement to build the business your heart would really love to create. Combining practical business and intuition for a more holistic approach is my unique skill.
Book your free Authentic Business Strategy session to get some pointers, and to see whether its for you

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