• Dennis Kelley

    David Kelley

    Dennis Kelley is a seasoned professional with over 30 years experience leading teams and coaching people to success. Dennis is in high demand as a speaker, consultant, trainer and an author... Read More

    David Kelley

  • Inspirational Quote

    “The greater danger for most of us is not that our aim is too high and we miss it, but that it is too low and we reach it.” -- Michalangelo
  • Connect with me on LinkedIn. Click here to view my profile and join my network. A strong, wide network is one of the keys to success. View Dennis Kelley's profile on LinkedIn
  • January 2009
    M T W T F S S
    « Dec   Feb »
     1234
    567891011
    12131415161718
    19202122232425
    262728293031  
  • Advertisements

Creating and Keeping a Healthy Business

Know Your Business Vital SignsThis is the first in a series of post where I want to address the four things you must focus on and understand to keep your business healthy and strong.

By paying attention to these areas, you will find that you have a much better perspective on your business and more control over it. These four main areas will help you to recognize when changes may be needed or adjustments made to keep the business growing and prosperous — or to build it if you have been struggling.

The first critical focus area is understanding your Key Financial Drivers. Ask yourself, “What make my company money,” What costs us money,” What are our key performance indicators (KPI) that tell me if the business is performing effectively,” and “How are we performing against our stated goals?” By asking yourself these questions you will be addressing the key financial areas that drive your business.

What naturally happens when you ask these questions is that you go gather the data to answer the question. If you keep asking these questions on a regular basis then you begin to understand how your business works from a financial perspective and you start to make better decisions. The quality of the decisions you make is in direct proportion to the quality of the questions you ask.

Here are some action items to get you started using these questions to understand your businesses financial health.

  • Review the financial reports and indicators for your business (if you don’t have them, that is your first step – create them today!)
  • Assess anything that is unclear about the financial performance.
  • Determine what areas of your business need to be monitored that will tell you if you are on track. These become your KPI’s and should be tracked and reviewed regularly.
  • Spend time with your CPA or accountant to talk about ways to improve your results.
  • Make a list of areas you want to focus on and tie them back to your long-term goals to make sure they are supporting your vision.

Understanding your financial situation is absolutely critical to your business health. History is littered with failed businesses that had a great product, a strong market and competent workers and still failed because the owner did not understand how to manage the money. Cash is king and cash-flow does not equal profit — know the difference and manage using the numbers. Your business will be much stronger for it.

Next time I will talk about the importance of understanding the business and what you should focus on to keep it growing and healthy.

To Your Success,
Dennis

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

w

Connecting to %s

%d bloggers like this: