I think it’s absolutely crazy for business owners and entrepreneurs at the moment to be trying to navigate their way through this pandemic and economic crisis, with a blindfold on.
It’s an interesting time at the moment and it really scares me to see how many business owners are relying on average spreadsheets. They’re relying on average reports that they get ad hoc. They’re relying on rubbish accounts that are an absolute mess and expect all of this to be able to navigate them successfully through some of the most challenging times that we’ve ever experienced in business.
The businesses that are moving in the right direction, the businesses that are climbing their way through this. Irrespective of how bad that industry has been impacted, irrespective of where they’re geographically located, are businesses that are making data-driven decisions.
They’ve got good information at hand and in a timely fashion, they can understand the financial impact, profit loss, and cash flow of those decisions.
Now, it’s not a perfect science by any means. We’re making a set of assumptions based on the information that we have. But the businesses that are navigating their way through this with confidence, with certainty are the ones that run the numbers. They have good clean information at their fingertips. They have a good way to quickly run various scenarios and see the financial impact of their decisions.
They don’t only rely on gut feel. If this sounds like you, it’s so important that you move away from pure gut-feel decisions. There’s nothing wrong with gut feel. I think intuition in businesses is paramount. You’ve got to trust your intuition, you’ve got to know when to take the risks. You’ve got to know when to take that leap of faith and as entrepreneurs, if we don’t take that leap of faith, we will never succeed.
However, there’s nothing to measure against. So we’ve got to be clear on if I invest here, here’s the best case, here’s the worst-case and here’s what sits in the middle. If I’m gonna let somebody go, what the impact of that. How much harder does everybody else have to work? What’s the utilization of my staff, what does that look like? There are so many different metrics but you’ve got to make data-driven decisions. Otherwise, I can guarantee you will fail.
It’s essential that you’re getting this information, it’s essential that it’s at your fingertips so that you can make strong decisions. And if it’s not, you need to reach out and get some help from somebody. Most people will reach out to their Accountant. And if that’s your go-to person go to that person, get the system, get the right financial system and advice for your business put in place so that you can make faster, clearer data-driven decisions so that you can move in the right direction.
If you need any help with this, please feel free to reach out.