Updated: Jan 10, 2019
The business owner was angry and frustrated. The financial performance of the business was yet again poor. He said he had a financial problem. As I sat back and pondered his dilemma I asked myself what the underlying problem was. Was it a financial issue or were the financial results only symptomatic? How can I assist him to broaden his business view beyond the current financial performance of his business? Let me put it another way – what is happening upstream that is causing his business to underperform?
My purpose is to solve business problems in three ways. Yet you will not find me using financial words. This coming from an eminently qualified and experienced accountant!!
Financial results are a by-product. They are the result of various upstream business activities.
What do I mean by that? At the end of each month, there is an accounting function that needs to happen. Once the month-end adjustments have been made to ensure the financial results are accurate, the financial results are a historical document telling you how you performed for the last reporting period.
The owner is an intelligent individual with terrific technology skills that lead him into the business he is in today. We began to explore some of the issues causing his poor financial performance. It came down to three issues. Strategy, staffing and systems.