A key Foundation for Success is the ability to generate reliable and meaningful financial reports to track the trajectory of the financial performance of your business. Establishment and maintenance of a profit & loss, balance sheet and cash flow budget and forecast, including regular review of budgeted vs actual results, both for financial and non-financial metrics, will prove beneficial. These reports need to be-
Accurate - Constraints to this include the inaccuracy of inventory & WIP levels. You may need to undertake a detailed review of your internal record-keeping and processes to correct this.
Timely- Aim to have financial reports available for the management team to review within a week of end of month.
Understandable /Meaningful - Relevant to your business and allowing you to track progress towards your financial goals. Highlight areas of under-performance for swift action and correction.
The next step to building on this foundation is clearly understanding what these financial results and ratios mean, and the impact they have on your business. Ask a trusted advisor or expert to mentor you in understanding the results and identifying actions to be taken to stay on track, and opportunities for growth beyond the budget.
PRIME your business
Learns from UBT Q4 Sydney seminar
We’ve all heard the saying, ‘Failing to Plan is Planning to Fail’, yet despite this, many business owners don’t have a clear strategy on the way forward for their business. The acronym PRIME can assist you in this-
• Plan on a page
• Revenue & Resource
• Incentives & Inspiration
• Mentor & Management
Is your whole team aligned to your vision for your business, including the shareholders? By articulating your 2021 strategy via a simple Plan on a Page, the improvement in culture and financial performance could be exponential.