Weekly Business Idea

August 4, 2017 – Do You Know Where You Are?

Posted on | August 4, 2017 | No Comments

Main Idea:

Does your phone know where you are at all times?  Or do you turn off the GPS signal because you are tired of getting the messages from Facebook or Google asking you to rate the restaurant you just came out of?  Do you have your kids phone tracker turned on, so you know where they are and where they have been?

Expansion of the Idea:

In the past few weeks I have seen several situations where small business owners had small and large surprises because their systems were not giving them reliable information.  There were multiple causes for the problems.  They may have outgrown their systems, had poorly designed systems, selected the wrong advisors or just didn’t pay enough attention to the systems.  Frequently it is a combination of reasons.  The problem is that if a business doesn’t know where it is, it is extremely difficult to achieve your goals.  This would be similar to being dropped off in the middle of the Amazon rain forest and you were going to rely on your cell phone for the way out.  You look at your phone to get your coordinates.  You see that it can’t determine which way is north, you are lost and you are almost out of battery.  You might have a tendency to give up hope.

Accounting and information systems can be one of the most useful tools in your possession to achieve your goals.  In an ideal world, the accounting system is working well and you know exactly where you are and how you got there.  You can plot that against the path to achieve your goals.  When you go off course, you can evaluate how to get back on course. It is extremely simple in theory and much more difficult in practice.  Systems require the following to work:

  • Planning
  • Communication
  • Clarity
  • Documentation
  • Testing
  • Maintenance
  • Revisions
  • Inspection
  • Management
  • Escape Valves (When to depart from the system)

There are probably a few more pieces that you could use to describe what is critical to systems.  The point is that you can’t just pull Quickbooks off the retail store shelf, give it to a bookkeeper and say go do it.  The accounting system has to interact with all of the other systems in the business.  The real power of the accounting system is to give you information on your path to achieving your goals.  It can either be a cost or a money maker.  The choice is yours.

Places to Start:

  1. Do you know where you stand financially?
  2. Are you getting key performance indicators that help you manage your business?
  3. Is your accounting system working well?
  4. Are you using the information to making decisions?
  5. Do you have short and long-term goals?
  6. Do you plot where you are and the path to achieving the goals?
  7. This also applies equally to your personal situation.

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  • About

    These weekly ideas are brought to you by FitzGerald & FitzGerald P.C. For more information about how to use these ideas with your small business contact Tim FitzGerald at trfitz@fitz-net.com.