Steps to successful financial management

• Invest in a sound core – an accurate ledger, records and processes
• Plan your business from an operational viewpoint – remember your financial plan reflects your business operation – set integrated KPIs
• Make sure you can provide operational capability to meet your targets – HOW will you grow 20% this year, WHO will do it, WHAT will they be selling…
• Review your KPIs each month
• Review and realign your goals by reforecast – the market or business factors will likely change at least every three months

These are big business principles that apply equally to small and medium businesses. There's a reason they're big businesses, right?

Call to action (part two)

If you’re reading this from a large business, you’ll know what a pivotal role the finance unit has in the direction and control of business. Why do large businesses have dedicated experts in this area? – Because they know continual success on a large scale does not come about by accident. It comes about through the management team understanding completely what needs to be done to become successful, what has been achieved and why and what needs to change to meet targets. Financial management is the process and toolkit that provides that knowledge. Each month there’s a dedicated focus (and from our experience in large businesses, an immutable deadline from the top) on understanding results and reprogramming operations for the next period.

So the call to action is to small and medium companies. The same processes and disciplines that large corporations use for managing finance apply to you too. Checking in once a year with your accountant is not enough. You may think you don’t need a fulltime finance manager, or that the cost wouldn’t be justified. Think again. Financial management is not expensive, and many accounting firms are realising that business owners benefit far more from the in-house commercial model that large businesses use, and are creating value-add packages accordingly. Make your accountant your finance manager.

Online and moving on

For the third time in not so many days, we met a client who was ready to move on from their current accountant. Basically this was because, as an entrepreneur in today's environment, they want fast moving, forward looking advice, given in the context of their business. They're a savvy, tech company well able to plan and manage their day to day finance activities and monthly compliance issues, they use online software to track their ins and outs and know pretty much each day what their position is. Remote, one-size-fits all annual support is not cutting it.

We hear this more and more and congratulations to those accounting firms who are stepping up with strategic, integrated support which is gets businesses to their goals. There are more of us out there now, so you don't have to get what you always got.