Give Your Business A Year-End Checkup to Finish Strong and Prepare For A Profitable 2016.
Whether you’re a 10-person operation or 100 employee company, the name of the game is improvement. Either your business is progressing, stagnate or facing losses. By reviewing your company’s health, from top to bottom, you can ensure it is in good shape to face the challenges of sales growth, cost controls and employee productivity.
What’s the status of your business now? Where do you want it to go? Will you meet your profit goals? Be relentless to finish 2015 strong. The new calendar year is also a good opportunity to examine all aspects of the business. Taking time in the next few days or weeks to thoroughly give your business a checkup will prepare everyone in the business for a successful 2016.
Growing a business means being involved in all aspects of profitably managing sales, marketing, operations, financial and cost analysis, employee relations and administration. Because of this, it is easy to become too involved in working “in” the business instead of working “on” it.
Depending on the size of your company and the support staff you have, there are several means to begin your year-end “checkup.” Redirect and utilize your staff, prioritize what you do each week to conduct a self-review, or if you would entertain an outside, objective and confidential analysis, we can assist in that process with you. Ideally input from all sources would be most beneficial.
However you decide to proceed, here are some areas to probe in your year-end check-up analysis:
- Maintain excellent financial records. Keep track of how much money is on hand and how much is owed in order to stay on top of your overall financial picture. It’s amazing how few small businesses have any idea of the daily, weekly, and monthly numbers and financial trends in the organization. This is often overlooked as long as there seems to be enough money to cover outgoing vendor checks and weekly payroll. Spend the necessary time keeping current on cash flow.
- Control costs. Build an information system that tracks cost embedded in each business function or process. The system should track actual time expended so that labor costs can be controlled while providing incentives for employees.
- Personally take the responsibility to decrease fraud by putting controls in place to prevent a diversion of funds, inventory or property.
- Talk with your customers about their focus and interests. The extra effort to increase customer service and sales will set your company apart from competitors and increase sales.
- Maintain sufficient working capital. Although some businesses might be able to survive for a short time with a small amount of capital, eventually the money runs out. Maintain a financial safety net.
- Adequately train and develop employees. This is an often overlooked responsibility that can keep staff motivated. Employee involvement in the business and good communications can pay dividends from employee input for profit and productivity improvement.
- Develop at least an annual strategic plan. Create realistic but precise goals that include deadlines in a formalized strategic and operational business plan. Include employees and consult the business plan on a regular basis. Stay flexible to changes in the strategic plan.
- Focus on short-term growth. Key company goals should be monitored weekly rather than monthly or quarterly. By focusing on business growth in the short term there will be far less concern over the long term.
- Develop reporting systems. Strategies cannot be implemented without reporting systems that track critical numbers. A regular review helps to measure and clarify where company efforts need to be enhanced as well as holds each employee accountable for performance.
- Offer incentives to key business drivers. All employees have the ability to drive or stall the business. Creative incentives that drive should contribute to both the profitability and mission of the company.
Many business owners measure their success by how hard they work and whether there is enough money to cover payroll. We can all learn to manage smarter and utilize all the resources we have in our organizations.
GOOD LUCK WITH YOUR ASSESSMENT, YOUR DIAGNOSIS AND
THE PROFIT IMPROVEMENT PLAN FOR 2016.