Organizing your business to print money at will begins with optimizing the time and information at all levels of your organization, which begins with having informed and intentional accounting tactics, and an efficient accounting software platform. Those tactics begin with:
POSSESSING THE RIGHT PERSPECTIVE
Without the proper knowledge and understanding, accounting can feel like an intimidating chore instead of the key business decision making function that it is, which is why the right perspective is critical. Your business communicates with you through its financial reports, which are the profit and loss statement, balance sheet, and cash flow management reports; however, that data is only as valuable as how and when your management team uses it to operate the business.
TRACKING INCOME & EXPENSES
Each time that your business makes or spends money, or adds or removes an asset or liability, it represents a financial transaction that must be categorized and organized (into Chart of Accounts) for financial reporting and taxation purposes.
PROACTIVELY MANAGING CASHFLOW
Earned income is tracked through invoices that are sent out to customers via your accounts receivables process, while received vendor invoices are tracked through your accounts payables process. Both of those processes work together to provide you with a forecasted projection of inflows and outflows of cash over a specified period of time.
PAYROLL ACCOUNTING
Paid company labor that is itemized by job function, and/or assigned tasks provide you with the ability to measure employee performance and productivity thus enabling you to improve work output capacity.
INVENTORY ACCOUNTING
Recorded, organized, and accurate on-hand inventory accounting provides the necessary data to manage stock levels, thereby ensuring that sales performance isn’t interrupted by unplanned inventory shortfalls.
BUDGETING & ANALYSIS
As the financial transactions of your business are categorized and organized, financial reports can be prepared that provide key insights into the flow of money within your business. The key to establishing the ability to print money at will is having a management team that's equipped with the skills and training to set percentage based performance goals for each financial category of the profit and loss statement to then take measurable and accountable actions when performance variances are identified.
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Another component of organizing your business to print money at will is to have a collaborative, disciplined and accountable Management Team that's knowledgeable of the following:
ORGANIZATIONAL VISION & GOALS
A clearly defined and communicated organizational vision along with accompanying strategic goals prevents your management team from beginning to operate in silos where each member of the team is primarily focused on their slice as opposed to the collective operational pie that is your business in its entirety.
ROLES & RESPONSIBILITIES
Clearly defined, accountable, and communicated roles and responsibilities ensures that your management team understands how their individual functions factor into the organizational strategy at large, which brings me to internal strategic communications.
INFORMATION MANAGEMENT
Our mind is far more effective at producing thoughts and ideas than actually holding them, which highlights the importance of how internal communications are structured. Between information and tasks being communicated in passing or electronically rather that be text, email, or any other communicational platform, a system that keeps communications and information organized and easy to access is essential to building an effective and efficient management team capable of printing money at will.
BUSINESS DEVELOPMENT
Collected data is only as valuable as how and when it's used, which is why it's essential for your management team to have an informed, intentional, and accountable system of analyzing performance data, action planning, and establishing or maintaining standard operating procedures that documents the process of routinely repeated activities and tasks.
PERFORMANCE EXPECTATIONS
Now, when it comes to setting performance expectations, the SMART principle fits like a glove. As long as the management team is making those performance, expectations Specific, Measurable, Achievable, Relevant and Time-Bound. Those SMART performance expectations, provide your management team with guardrails to hold your team accountable for their performance. Thus, increasing the ability to control payroll and material costs.
ACCOUNTABILITY
Monitoring performance and providing feedback are essential to maintaining organizational accountability, which is why your management team’s ability to do so is absolutely critical to maintaining planned, predictable performance.