We are well into the New Year. Now that Year End is behind us and we are looking toward the joys and challenges of running a business, let’s review some of the ways we can work smarter, not harder. As I have said on many occasions, and I know we have all heard the mantra from various sources, “failing to plan means you can plan to fail”. I would like to offer suggestions for making a plan that will help you be more prepared for the challenge of running your business and could very possibly be the road map to business growth.
First of all, we recognize that looking to our bottom line is the best way to make business decisions. Driving your business from a financially savvy perspective is the smartest way you can choose to make your business decisions. Get familiar with your key financial reports. Your Balance Sheet offers a snap shot in time of the financial wellbeing of your business. Take some time to sit down with this tremendous report and understand what it is telling you. This report contains your assets, liabilities, and equity. If you subtract your liabilities from your assets, that is the equity or net assets of your business.
The Profit and Loss, also termed the income statement or income/expense statement, summarizes the revenues, costs and expenses associated with running a business. This report provides information for a period of time. Some have likened the Profit and Loss report to a moving picture of your business. This report allows the business owner to see, at a glance, revenues and how they are impacted by the costs of running the business. Things such as cost of goods sold, overhead, tax and interest expenses, and anything that impacts the bottom line, as available for review on this handy report. A great tool to use with the Profit and Loss is the statement of cash flow.
You may wonder where I am going with this. The idea is that, improving your efficiency can translate into an improved bottom line.
- Get organized!! This is one of the best ways to keep an eye on your bottom line. Nothing is more damaging to the bottom line than lost productivity. Time spent spinning your wheels, either literally or figuratively, is time taken away from being productive.
- Create process documentation to help refine your processes and aid in cross training within your organization. Documentation of your processes is a great organizational tool, especially for those tasks that occur infrequently.
- Schedule follow-up with both employees and clients. Make certain you keep your finger on the pulse of your organization by maintaining open communication with your employees. Invest them in the success of your business as well as empowering them to have a voice and not just a 9-5 robot there to go through the motions. A similar theory holds for your clients. Make sure they feel that they are more than just a paycheck. Send a handwritten note to say you appreciate their business. Be available for a phone call, especially if they have a problem or question.
- Plan ahead! You can quickly lose your day, if you work from a reactive stance. Understand that there will be fires that need to be put out, but be proactive and look ahead to the things that you know will arise. As with the accounting industry we understand that there are tasks that must occur daily, weekly, monthly, quarterly, and annually. Those types of tasks are planned and on the calendar. The more surprises you can eliminate the more time you have just given yourself back.
- Do NOT procrastinate! I once visited a colleague and on her computer was a saying, “Eat the worm!” I questioned her about that odd saying. She explained that she starts everyday with the unpleasant task that she must complete. Once that task is out of the way, she can look forward to the rest of the day.
If you have some suggestions for getting organized, please feel free to share them. We are all on this wonderful journey together and an open discussion of business ideas that work. as well as those that haven’t, can only enhance the process.