Here's a crazy question...would you ever consider driving your vehicle without a working dashboard? Think about that before you answer. Take as much time as you need...
I suspect that the overwhelming majority of you probably wouldn't risk it. Afterall, with so much at stake, why would you take the chance?
Ok. Time to raise the stakes. Let's take this a step further.
In this scenario, imagine you've packed up the family truckster, buckled in your loved ones and you've set out to drive due South to Orlando for a lovely fun filled vacation at Disney World. If you're lucky, you'll arrive at the Magic Kingdom sometime in the next 24-36 hours just in time for that curious smell from the backseat to reach its peak.
You're an hour into the drive when all of a sudden you notice that your dashboard isn't functioning. Now what? You didn't plan for this. No gas gauge. No speedometer. Nada. In spite of the fact you've only been in the car for an hour, the family is slowly starting to turn on you.
Do you take the risk based on gut feel and proceed? With so much road in front of you and so much valuable cargo in tow, and the fact that the kids are growing restless, you have to carefully weigh your options.
But you're responsible right? There is too much at risk. Easy decision.
So now you do the logical thing. You give the vehicle a once over with the limited visibility and understanding of the intricate machinery staring you dead in your eye. You might hit it with a wrench, speak in tongues before you swallow your pride and make the ultimate concession without ever having admitted you don't have a clue or a game plan.
To save face, you try to find the nearest dealership or garage and head there immediately. Afterall, you don't want to place the lives of the ones you love most at risk.
It seems like it's an open and shut case right? Plain and simple.
And that (my esteemed friends and colleagues) is why you need a dashboard.
So if that scenario seems like such a slam dunk, then why do most entrepreneurs and business owners alike run their business without a "financial dashboard", that tells them at a glance how well (or not) they're performing against their Key Performance Indicators (KPI).
Similar to a vehicle, your business supports you and your loved ones, and you need to give your business dashboards the same importance that you give the dashboard in your car.
At a glance, (and you need to glance at it frequently) you need to know your revenue month to day (MTD) and year to day (YTD). and how it compares against your budget.
If you don't have a budget, you'll need one (we'll cover that in another post).
Similarly, you need to know your Cost of Sales (COS), or your Manufacturing Cost (MC), and various other KPI that drive your business.
As a business owner, you need to look at this information in real time, not at the end of the year, By the time your bookkeeper gives you your "historical" financial statements, it's already 3 months or so after the close of the year. The biggest issue with that is that it's too late because you drove the vehicle off the road a long time ago.
If you're driving blind as a business owner, pull the proverbial car over to the side of the road and call us immediately. Steelmark can help. We'll give you the visibility and roadmap you need in order to make fully informed key business intelligence (BI) decisions.
This and more from Dinyar Gai in coming weeks. We look forward to hearing from you.