Is your financial sat-nav working?

One of the most significant tech innovations of our era has been the sat-nav – a true game-changer for drivers everywhere.

Gone are the days of relying on vague instincts and deciphering road signs when embarking on unfamiliar journeys. If you had a poor sense of direction, this was inevitably accompanied by wrong turnings, longer journeys than necessary and considerable nerves.

The introduction of sat-nav technology ensures that from you moment you step into the driver’s seat, you always know ‘where next’. Even nervous drivers can drive with confidence, because they always have visibility ‘over the horizon’ and can reach their destinations using the fastest and easiest routes.

You need a clear financial roadmap for your business, too.

Over the past few weeks, I’ve been talking about the importance of management accounts, which offer an in-depth view of your current business performance. But to truly lead your company confidently and successfully, you also need to grasp what lies ahead financially for your business.

For example:

  • How much money will be in your business account next month, in 3 months’ time, or in 6 months?
  • How profitable will you be over the next quarter and next year?
  • What are your spending priorities today, in Q4, in 2024?
  • How are inflation, interest rates and exchange rates going to affect your bottom line in the foreseeable future?

Without answers to those types of questions, you’re flying (driving?) blind – especially in the current economic and political conditions, which have caused significant instability to businesses. You’ll be continually taken by surprise by your financial situation, end up fire-fighting unexpected crises and find it difficult to plan ahead. And that’s a very nerve-wracking way to work and to lead.

No one can answer any of these questions for sure. We’re not prophets!

But when you understand what is likely to happen – or even have a couple of different scenarios showing how these questions might unfold – the entire way you manage your business changes.

Imagine having a clear idea of ‘where next’ for your business financially – understanding how inflation might hit you, what your billing looks like over the next 6 months and when and where there may be gaps in your income or profitability.

Armed with this kind of knowledge, you can mitigate serious financial risks and take the actions that are necessary to build a much more profitable business. All your decisions will be much better financially informed – which will inevitably make you an even more effective, confident leader.

Over my next few blogs, I’ll be discussing how you can project financially forward correctly, based on the approach that our Outsourced Financial Management service takes with our clients. I have a few surprising takes for you – so watch out for those emails!

But in the meanwhile, if you like the idea of a clear financial roadmap for your business and want to find out more, please do email garry@insightassociates.co.uk or call us on 01279 647 447.

During this no-obligation chat, we’ll talk about the way your company currently manages its finances and explore whether our Outsourced Financial Management service can help.

Take the wheel of your business’s financial future today – and together, let’s drive towards success.

Warmly,

Garry

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In this blog archive our Managing Director, Garry Mumford simplifies all things financial and shares with us a lifetime of practical financial business advice.

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