Here’s How to Get Financially Healthier for 2016
Here are some guaranteed suggestions to improve the financial health of your business this year.
How did last year finish up for you? Did you hit your revenue goals? What about profitability? Did you end up in the red or black? What about customer satisfaction? Cash flow? Collections?
Managing an IT services company is challenging enough – now try staying on top of technology trends, customer needs, support calls, and sales opportunities. It’s easy to get overwhelmed. Unfortunately, administrative responsibilities are the first area to suffer. Most small IT business owners struggle to make clear decisions because they are overwhelmed with cash flow crises, collections challenges, time-consuming invoices, and late bill payments. This takes focus and time away from the revenue and profit-generating activities that truly keep your business going.
So the question is, why will this year be different from last year? What specific changes have you implemented to make sure this year improves over last?
Here are a few fundamental changes you can implement quickly to improve your cash flow, speed up your collections, streamline payables, and increase employee satisfaction.
- Automate Your Administrative Processes—ALL OF THEM
You’re a tech company; I know you believe in the significant benefits of utilizing technology to improve business. So why do you still receive and send hard copy cheques? Why do you and your staff submit paper receipts for your business expenses?
Today, everything can be electronic. Invoices are emailed, bills are paid online, employees get paid by direct deposit, expense receipts can be photographed or scanned for automatic reimbursement, and payables and receivables can be pre-scheduled so there is zero manual intervention. With the right tools, your finances will be streamlined to eliminate all bottlenecks – getting you and your staff paid faster and more accurately.
How many of your admin processes are currently automated today?
- Create An Accurate, Up-to-Date Recurring Financial Report, and Review it Weekly
I know, most of you use some type of PSA tool that creates dashboards so you can log in and look at your revenue, invoices, receivables, etc.
Question #1: How often do you review it, and I mean really scrutinize it? Question #2: How accurate and up to date is the info? When the information is only partially there, or it’s not current, its usefulness diminishes rapidly. Create a report that provides you with an ACCURATE weekly snapshot of your financial data (i.e. payables, receivables, overdue collections, bank balance, etc.), schedule an hour every single week to review, and you’ll be amazed at the clarity of your decision making.
- Outsource Your Administration
If the first two suggestions sound good, but you’re thinking “we don’t even have time to breathe, let alone make sweeping changes to our admin department – there’s no way we can pull this stuff off”, then it may be time to consider outsourcing your admin tasks.
Finding a great outsourced solution for a reasonable fee may be the best decision you ever make for your business. Allowing experts to manage these processes may free up the distractions that have been plaguing your business, and allow you to focus on what’s important: your customers and making sure your revenue and profit is where you want it to be.
New Year’s resolutions are always popular in January, but many of them fizzle out in a few weeks or months. The truth is, it doesn’t matter what month it is – focusing on the improved financial health of your company needs to start NOW.