The minute the bookkeeper hands you the latest financial reports, you check the top and bottom lines. But once you have the big picture, you’re ready to dig into the details. All too often, the out-of-the-box income statement, balance sheet and cash flow don’t let you dig deep enough. They spur more questions than they answer. Questions like:
- Why was residential service revenue down more than commercial services?
- What contributed to the bump in labor costs?
- Wonder how profitable the DiamondCo project was?
Missed opportunities to act
It’s good to use financial reporting to generate pointed questions, but bad when your finance systems or staff don’t let you dig beyond the surface. It’s frustrating to know there is data beneath the numbers that could help you answer those questions and take immediate actions to correct missteps or seize opportunities.
Larger companies have the luxury of business intelligence delivered through their ERP or financial management systems. That access to data allows managers to dig deeper—understanding exceptions, identifying trends and looking for correlations. Information that gives them the perspective to take action quickly. In today’s data driven world, there is no reason that you shouldn’t be able to do the same.
Deeper information drives better decisions
Imagine if the financial reports that hit your inbox each month were designed specifically for your business and your industry, allowing you to look at performance from different perspectives. Reports that answer the pressing questions. Financial information delivered the way you need it will help you make sense of the unique challenges and opportunities your business faces. For example:
- Income statements reflect sales from the past month, year and may even compare to a year ago. But what if you could look at the trend lines of sales for different products and service lines? You might uncover the rise in sales from one service line had masked declines in another —arming you with specific question for your team to identify the root cause and address the drivers behind the drop. Or perhaps that insights triggers you to discontinue an underperforming line so you can reallocate resources to accelerate growth of another offering.
- Exceptions—results that stand out from the norm—can bring attention to both problems and opportunities. Uncovering the higher margin for a specific service line could lead you to a project leader who is achieving higher project productivity. The best practices of that project leader could be applied across the organization to increase profits across all projects.
- Key Performance Indicators with comparisons to your peers provide an objective benchmark to gauge your results. Are companies like yours achieving higher margins for the same services? Does your revenue per employee align with other companies in your industry?
The data behind your financial statements can unlock the insights you need to make the best decisions. Asking the hard questions—and getting accurate answers—is fundamental in navigating the challenges and opportunities of your business.
HOW TO IMPLEMENT
At Driven Insights, our bookkeepers and controllers are charged with much more than simply “doing the books”—they take the time to understand your unique business challenges and provide financial information that will support more educated decision-making. With a full understanding of your objectives, we will help you define the metrics and analysis you need in monthly reports and dashboards.
Imagine what opportunities you could find to transform your business. Let’s talk about how Driven Insights can provide forward-looking information to help you build for the future. Contact us at email@example.com or 888-631-1124.