Real-Time Data: Like A GPS For Your Financial Strategy

Accurate, timely and detailed data acts like a guidance system for your financial decisions. The results are better focus, fewer wrong turns, and more money earned for the same level of effort.

When a new client signs on with Business Lab, it's not unusual to discover that the business owner has been steering the company's finances and growth based on one part intuition, one part common sense and one part last month's balance sheet.

Our team applies a remedy to that as quickly as we can. Making critical financial and strategic decisions without accurate, up-to-date information is like driving on a mountain road without headlights: not advisable.

Of course, most business owners do a pretty good job at keeping tabs on their company's big-picture financial performance, where they can see profits, assets liabilities, and, if they're lucky, get a rough sense of cash flow.

But only a small number of those business owners have the data and the tools to drill down even one level into their finances to get a clear picture of business performance by segment--say, the three to five key categories comprising the core of their sales. Even such fundamentals as gross revenue and expenses by segment are out of reach.

That's a real loss, because you need this level of data to compare revenues and gross profits by category. For example, if you are a manufacturer and you sell several product lines, chances are that you have one or two product lines that are your ‘bread and butter’ and account for significant revenue and profit and a few product lines that may actually lose money.

Sometimes, this situation can make sense if the poor performing product lines lead to more business in the highly profitable product lines but often times business owners don’t really know how much each product line contributes to revenue and profits

What's the ideal level of detail? When you can easily compare revenue and profit numbers by customer or customer groups, you can fine-tune product development, sales, marketing and customer support to match what these customers are actually worth to you.

This is information worth getting. When businesses don't have it, they work a lot harder than they need to, and they risk making costly errors.

After all, your business has limited resources. If you over-service an unprofitable customer, or over-invest in a marginal product, it’s inevitably at the expense of your best customers and your biggest moneymakers. But if you only have anecdotes and educated guesses to guide you, you run a real risk of creating a costly mismatch.  Detailed, accurate, near-realtime data, you can dial in your investments of time and resources with confidence that you're steering the company toward greater success.

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