According to the Wall Street Journal, 60-80% of business owners don’t know what their financial statements are telling them. I know what you’re thinking. “That’s not me.”
Businesses should be continuously tracking performance to identify potential issues and make room for improvement. This can be surprisingly complex and involves more than simply reviewing financial reports each month or quarter. A significant amount of data can go into performance tracking. Maybe the most complex part is identifying the Key Performance Indicators that are unique to your company.
It is essential to select the right KPIs to track and to implement efficient systems that provide you with the information you need to make decisions today that will affect your profitability tomorrow. Many company leaders and boards of directors might not know how to identify the right KPIs, which can lead to lots of irrelevant reports that don’t properly identify issues.
If your company needs an accurate and granular performance tracking system, you should consider seeking help from a fractional CFO. At CFO Simplified, we provide a variety of CFO services on an as-needed basis, including effective performance tracking. This can be a complicated process, but our part-time CFOs have the financial and business knowledge to help your company trend in the right direction. Contact us today for more information.
Accurate and effective performance tracking involves more than reviewing your receipts and expenses. The following are only some aspects of performance tracking for many companies:
Tracking all of these indicators is impossible. Some of these KPIs might not be relevant for our company, or there may be more that would specifically help you guide your business. Selecting and measuring KPIs can be complex and time-consuming. Let a part-time CFO help you with the analysis, while you focus on the daily operations of your business.
At CFO Simplified, we often refer to our specialists as “business detectives.” Our fractional CFOs know how to review information and metrics regarding your business in a practical and effective manner that can improve your operations and results. We work primarily with small to mid-sized companies in all types of industries, from manufacturers to service companies to non-profits, and we can assist with the performance tracking that can give your business the advantage it needs to not only succeed, but thrive in the future.
There is no doubt that when done correctly, performance tracking can benefit your business and have a real impact. It provides you with the information that you need to make the decisions today that will affect profitability tomorrow. However, this is a commonly neglected aspect of business leadership, as many leaders are so focused on customer acquisition, product development and sales that they fail to use readily available data to help them actually run their company. Effective performance tracking is possible with the help of a part-time CFO.
CFO Simplified understands how busy company owners and managers can be, and how easy it is for things like performance tracking by using dashboards and KPIs to be put on the back burner. Contact us to discuss how we can help take your company to the next level.
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