When we speak about running a company, what you have to know is that only the skills for the industry where your company acts or trades are not enough. After you’ve proven that you can bring a quality service or product to market, it comes the most challenging part of owning a business. As you probably guessed I’m speaking about running the respective company.
Regardless the industry, or the field they came from, most business owners started by working for someone else honing and developing their skills. They may have moved up in the ranks being promoted for the work they had done, and learning what they liked and didn’t about their employer or the way the business was run.
After going on their own, it didn’t take long for any business owner to realize that there is more about running a company than producing a quality product or providing the highest quality service in the industry. Additional expenses, tracking all the money that come and go, financial reports, statements showing the loosing of thousands of dollars, are just a few things that I’m referring to. In other words, there comes a time for every business owner to realize that running the business has become more important than the business itself. At the end of the day if you don’t manage it properly, there will be no business to manage.
Make Quality Decisions
The reporting system, even a simplified one, is like the dashboard of an automobile that tells vital information to the driver of the vehicle. Without them the driver is required to have the mechanical skills. This means that the reporting system assists the business owner in making quality decisions without having necessarily an MBA. Imagine having a snapshot of all the vital areas of the company in an easy-to-read format that any business owner can read and understand. But as simplified as this reporting can be, it’s not easy for most business owners to develop it. There is a large difference between bookkeeping compliance that collects information and puts it into a historic report and managerial accounting that takes a much more aggressive forward proactive approach. This kind of managerial accounting and simplified reporting is usually recommended to be developed and implemented by a specialist in this field.
There are various consultants, advisors, accountants, or business professionals that can assist in setting up of these systems and controls in order to develop a simplified dashboard for the owner to understand. You can also hire someone with PA Training. This is where the business owner must realize that every dollar spent in the business is an investment. And like all other investments its not so much about what are the costs as it is about the return on investment. By having accurate and updated information, the business owner can capture small percentages or even fractions of percentages all across the income statement that can be translated into large amounts. And that’s why I said in the beginning of the post: there comes a time when running a business becomes more important than the business itself.