If there is one thing that causes inefficiency in the work place more than any other, I think it may be ripple effect of missed deadlines. Generally, missed deadlines come in two forms. One is the simple passing of a deadline without it being met. But the other, somewhat more difficult to assess, is when a deadline is met with inadequate information or work product being provided. Whether we are talking about the flow of internal information or the provision of a product or service to a customer, the result is the same. Ultimately, that missed deadline causes a ripple effect throughout the receiving organization and is the cause of substantial inefficiency.
Much like tossing a pebble in a pond, the effect doesn’t stop immediately but continues almost indefinitely. A missed deadline causes others to spend time waiting (never a productive task), changing their work plan (also known as “scrambling”), and going back to ask people when they will provide what they have already failed to deliver (my least favorite activity).
Many times, we don’t know or think of the effect of not delivering on a commitment to someone on the other side. While I have never tried to calculate this cost, I have no doubt it is substantial. Perhaps if we could calculate the cost, and somehow charge it back when someone didn’t deliver as promised, it would solve the problem. While major construction projects often impose penalties when the final deadline is missed, the same doesn’t hold true in most day to day activities.
Think of what happens when someone doesn’t deliver upon a commitment to you. In the best case, that causes increased pressure on you to do your part in a shorter amount of time and still meet your commitments. In the worst case, the ripple in the pond continues to the detriment of companies, departments and people you may have never thought about (or even know about).
Perhaps the worst part of the ripple effect is that it is so very difficult to stop once started. Obviously, there is no way to “unthrow” that stone in the pond. It simply has to run its course (or in the business world, someone has to go to the extra mile to meet their commitments even though they got a late start). Obviously, the best course is to not let the ripples start. Realizing how big a problem can become, we should all take extra care to not be the pebble in the first place; and that starts with all of us meeting our commitments on a daily basis.
While there are many things that businesses need to do to prepare for 2009, clarifying expectations around deadlines is certainly one that will add value throughout the year. Ultimately, it gives everyone the chance to be more productive and that is something that will be appreciated by both your employees and your customers. It might even increase your “top line”!
If your business could benefit from fractional CFO services, I would welcome the chance to speak with you. Please give me a call at (314) 863-6637 or send an email to ken@homza.com
your cash is flowing. know where.
Monday, March 1, 2010
The (Voting) Process (November 2008)
As the 2008 Presidential Elections fade from our collective memory, I’d like to ask you to take a look back and think about the voting process. No, not the two years running up to November 4th, how you selected your candidate, political spending or any of the important things leading up to the selection of our next President. Rather, I’d like to ask you to think about the time from when you got to the polling place until you left. More specifically, think about the process that you went through that day.
Some of us were fortunate enough to go to polling places with short lines but many of us had a bit of a wait (a small price to pay for the right and privilege of voting). But as I stood in line that afternoon, making small talk with the people ahead and behind me in line, I couldn’t help think about the process that was going on in front of me. For the record, my wait was about an hour. During that time, the first thing that I noticed is that there were always at least six voting machines open. Clearly that didn’t seem to be the problem that was holding up the line. Next, I looked at the six stations that were designated for certain letters of the alphabet (A-D, E-H, and so on). These weren’t busy either. Finally, I looked at the first station. There was one person looking at everyone’s voter ID card and handing them a white slip of paper after making a few notations on it. This person wasn’t comparing voter ID cards to any roll or list. There were just looking at the voter ID card and handing out a white slip of paper to be taken to the next station. This was the bottleneck and (at least in my district) the cause of the long line of people waiting to vote. I wondered, what’s the purpose of this task? Is it important to the process? Could it be eliminated? Why couldn’t there be two people performing it? Couldn’t we apply some computer power? How about voter cards with a magnetic strip? In a time when almost every task in our lives has computer processing associated with it (think about how few daily tasks are completely void of computer processing) couldn’t something be done to improve this process?
In any event, the purpose here (despite what it may seem) is not to figure out how to save time at the polls four years from now (although saving a few hours for millions of Americans is probably worth some time and effort). But rather, it is to point out the value of standing back and observing the processes in your business. Too often, we are so busy facing the day-to-day challenges in our businesses that we fail to take the time to stand back and simply observe the process. Given the opportunity, one can often find improvements by asking the simple question: Why?
Force yourself to take some time away from actually working in your business and stand back and observe what happens day-to-day. If you don’t feel you can be objective, ask a trusted friend or colleague to do it for you. I have little doubt that you’ll find opportunities for improvement if you spend the time to look at the process in your business.
If your business could benefit from fractional CFO services, I would welcome the chance to speak with you. Please give me a call at (314) 863-6637 or send an email to
your cash is flowing. know where.
Copyright @ 2008 Homza Consulting, Inc.
Some of us were fortunate enough to go to polling places with short lines but many of us had a bit of a wait (a small price to pay for the right and privilege of voting). But as I stood in line that afternoon, making small talk with the people ahead and behind me in line, I couldn’t help think about the process that was going on in front of me. For the record, my wait was about an hour. During that time, the first thing that I noticed is that there were always at least six voting machines open. Clearly that didn’t seem to be the problem that was holding up the line. Next, I looked at the six stations that were designated for certain letters of the alphabet (A-D, E-H, and so on). These weren’t busy either. Finally, I looked at the first station. There was one person looking at everyone’s voter ID card and handing them a white slip of paper after making a few notations on it. This person wasn’t comparing voter ID cards to any roll or list. There were just looking at the voter ID card and handing out a white slip of paper to be taken to the next station. This was the bottleneck and (at least in my district) the cause of the long line of people waiting to vote. I wondered, what’s the purpose of this task? Is it important to the process? Could it be eliminated? Why couldn’t there be two people performing it? Couldn’t we apply some computer power? How about voter cards with a magnetic strip? In a time when almost every task in our lives has computer processing associated with it (think about how few daily tasks are completely void of computer processing) couldn’t something be done to improve this process?
In any event, the purpose here (despite what it may seem) is not to figure out how to save time at the polls four years from now (although saving a few hours for millions of Americans is probably worth some time and effort). But rather, it is to point out the value of standing back and observing the processes in your business. Too often, we are so busy facing the day-to-day challenges in our businesses that we fail to take the time to stand back and simply observe the process. Given the opportunity, one can often find improvements by asking the simple question: Why?
Force yourself to take some time away from actually working in your business and stand back and observe what happens day-to-day. If you don’t feel you can be objective, ask a trusted friend or colleague to do it for you. I have little doubt that you’ll find opportunities for improvement if you spend the time to look at the process in your business.
If your business could benefit from fractional CFO services, I would welcome the chance to speak with you. Please give me a call at (314) 863-6637 or send an email to
your cash is flowing. know where.
Copyright @ 2008 Homza Consulting, Inc.
Planning In Volatile Times (October 2008)
There is an old saying: “When opportunity knocks, answer the door.” But in these volatile times, it is hard to know whether you are looking at an opportunity or not!? One can get whiplash just watching the stock market with prices up or down 10% in a single day. Take your eye off the ball for even a short period of time and the environment in which you are operating can be different than when you last looked.
During one of my first corporate jobs, I often wondered why the treasurer waited to make decisions. As I got to know both him and the company, I learned that it wasn’t procrastination, but keeping options open. At the time, we had some relatively straight forward financing decisions. It was common practice for us not to “pull the trigger” until the last possible moment. There was a lot of merit to that practice and over the years it added substantial value to the company. I often wonder if those decision makers still operate in the same manner or if they are more opportunistic in their actions. Today, what seems like an opportunity one moment can appear to be an expensive proposition the next.
There is always an opportunity to capitalize on short term market fluctuations. But the key is recognizing that fluctuations (in some cases, bubbles) are short term. People have short memories. In 1999 and early 2000 we thought internet stocks would increase forever (I certainly wish I had sold at the first sign of a downturn). A few years ago, many thought they should buy the biggest house possible (with the minimum down payment) because “everyone knew” housing prices would keep going up at 20% a year and was an easy way to make money. More recently, we had predictions by “the experts” that gas and oil prices would continue to soar after hitting $4.00 per gallon at the pump. After pushing nearly $150 per barrel just a few months ago, oil prices are under $70 per barrel as I write this newsletter.
The lesson to be learned here is that nothing lasts forever. It can’t. The laws of economics dictate that behaviors will change. Those who take advantage of short term market opportunities profit. Those that react to them after the fact will lose. Those that sit tight and place long term bets will likely be okay (in the long run), but it will be a roller coaster ride along the way.
With that in mind, unless your business is taking advantage of a window of opportunity, business decision making should be long term focused. It’s certainly advisable to take advantage of short term opportunities, but it’s important that they are recognized as just that. Extrapolating short term trends into the distant future is often a mistake. Don’t react. Plan.
If your business could benefit from fractional CFO services, I would welcome the chance to speak with you. Please give me a call at (314) 863-6637 or send an email to
your cash is flowing. know where.
Copyright @ 2008 Homza Consulting, Inc.
During one of my first corporate jobs, I often wondered why the treasurer waited to make decisions. As I got to know both him and the company, I learned that it wasn’t procrastination, but keeping options open. At the time, we had some relatively straight forward financing decisions. It was common practice for us not to “pull the trigger” until the last possible moment. There was a lot of merit to that practice and over the years it added substantial value to the company. I often wonder if those decision makers still operate in the same manner or if they are more opportunistic in their actions. Today, what seems like an opportunity one moment can appear to be an expensive proposition the next.
There is always an opportunity to capitalize on short term market fluctuations. But the key is recognizing that fluctuations (in some cases, bubbles) are short term. People have short memories. In 1999 and early 2000 we thought internet stocks would increase forever (I certainly wish I had sold at the first sign of a downturn). A few years ago, many thought they should buy the biggest house possible (with the minimum down payment) because “everyone knew” housing prices would keep going up at 20% a year and was an easy way to make money. More recently, we had predictions by “the experts” that gas and oil prices would continue to soar after hitting $4.00 per gallon at the pump. After pushing nearly $150 per barrel just a few months ago, oil prices are under $70 per barrel as I write this newsletter.
The lesson to be learned here is that nothing lasts forever. It can’t. The laws of economics dictate that behaviors will change. Those who take advantage of short term market opportunities profit. Those that react to them after the fact will lose. Those that sit tight and place long term bets will likely be okay (in the long run), but it will be a roller coaster ride along the way.
With that in mind, unless your business is taking advantage of a window of opportunity, business decision making should be long term focused. It’s certainly advisable to take advantage of short term opportunities, but it’s important that they are recognized as just that. Extrapolating short term trends into the distant future is often a mistake. Don’t react. Plan.
If your business could benefit from fractional CFO services, I would welcome the chance to speak with you. Please give me a call at (314) 863-6637 or send an email to
your cash is flowing. know where.
Copyright @ 2008 Homza Consulting, Inc.
33.33% of Life Is Just Showing Up! (September 2008)
According to the internet, Woody Allen is responsible for the quote: “90% of Life Is Just Showing Up”. While I’m not sure what the exact percentage should be, I’d argue that it’s no more than one-third. While showing up is necessary, it’s rarely sufficient to accomplishing very much at all.
Amazingly, there are times that people don’t even bother to show up. And I mean this quite literally. I’ve seen people go through the interview process, get the job, and then just not show up on the first day of employment. If I hadn’t seen it more than once, I’d have assumed it was a fluke; but it’s not. I’ve witnessed it twice during the past several quarters and it just makes me wonder what people must be thinking!?
Furthermore, is it really even worth anyone’s time if all that someone does is just show up? Frankly, there is more to it than that. Whatever you are doing, it’s worth doing more than just showing up. You only get out of any endeavor what you put into it. And it takes more than mailing in a performance.
We all have days when it takes everything we have just to show up and get through the task at hand. But on most days, it takes a lot more than just showing up to make anything happen be it in business, sports, personal lives, etc.
So rather than thinking that 90% of it is just showing up, perhaps it’s more reasonable to think that 33.33% of life is showing up, 33.33% of life is preparing, and 33.33% of life is about being in the moment and being fully engaged in the task at hand.
I used to train in karate (I hate saying “used to”). I can assure you that karate is a pursuit where just showing up won’t cut it. It might surprise many to know that when training in karate one never gets hit. Really, it’s true. Rather, one fails to block a punch or kick from an opponent. While the result (ending a class bruised and battered) is the same, the attitude and the discipline that philosophy instills are quite different. It’s not about being there and something happening to you, it’s about being responsible for what happens (whether it’s good or bad).
Business, like life, isn’t about just showing up. It’s a mix of preparation, being in the right position, and execution. As you think about your business, think about the areas where people, departments, divisions, etc. believe that 90% of life is just showing up. These are opportunity areas where you can improve performance. Tell them that you heard only 33.33% of life is just showing up and start to question the other two-thirds of their time (sorry, Woody).
If your business could benefit from fractional CFO services, I would welcome the chance to speak with you. Please give me a call at (314) 863-6637 or send an email to
your cash is flowing. know where.
Copyright @ 2010 Homza Consulting, Inc.
Amazingly, there are times that people don’t even bother to show up. And I mean this quite literally. I’ve seen people go through the interview process, get the job, and then just not show up on the first day of employment. If I hadn’t seen it more than once, I’d have assumed it was a fluke; but it’s not. I’ve witnessed it twice during the past several quarters and it just makes me wonder what people must be thinking!?
Furthermore, is it really even worth anyone’s time if all that someone does is just show up? Frankly, there is more to it than that. Whatever you are doing, it’s worth doing more than just showing up. You only get out of any endeavor what you put into it. And it takes more than mailing in a performance.
We all have days when it takes everything we have just to show up and get through the task at hand. But on most days, it takes a lot more than just showing up to make anything happen be it in business, sports, personal lives, etc.
So rather than thinking that 90% of it is just showing up, perhaps it’s more reasonable to think that 33.33% of life is showing up, 33.33% of life is preparing, and 33.33% of life is about being in the moment and being fully engaged in the task at hand.
I used to train in karate (I hate saying “used to”). I can assure you that karate is a pursuit where just showing up won’t cut it. It might surprise many to know that when training in karate one never gets hit. Really, it’s true. Rather, one fails to block a punch or kick from an opponent. While the result (ending a class bruised and battered) is the same, the attitude and the discipline that philosophy instills are quite different. It’s not about being there and something happening to you, it’s about being responsible for what happens (whether it’s good or bad).
Business, like life, isn’t about just showing up. It’s a mix of preparation, being in the right position, and execution. As you think about your business, think about the areas where people, departments, divisions, etc. believe that 90% of life is just showing up. These are opportunity areas where you can improve performance. Tell them that you heard only 33.33% of life is just showing up and start to question the other two-thirds of their time (sorry, Woody).
If your business could benefit from fractional CFO services, I would welcome the chance to speak with you. Please give me a call at (314) 863-6637 or send an email to
your cash is flowing. know where.
Copyright @ 2010 Homza Consulting, Inc.
Fix Your Small Problems First! (August 2008)
While I realize that the title of this newsletter might sound counter intuitive, it is a thought worth considering. Fix your small problems first. We all know that many books have been written about prioritization and tackling the A’s before the B’s and C’s. Still, I think there is a certain logic that suggests tackling small problems first might make sense. To be clear, I’m talking about real problems. I am not talking about cleaning your desk and sharpening pencils so that you’ll be ready to tackle the big problems. That kind of activity is procrastination pure and simple. Instead, I’m advocating a strategy of dealing with small issues before they become big problems.
Ask yourself, is it more likely that a small problem will go away or become a big problem later? I think we all know the answer. It is far more likely that left unattended, the small problem will become a bigger problem later. Just in case you need a few examples to get you started, consider these.
• Have you ever seen a minor roof leak go away? Generally, small leaks turn into bigger leaks. For the record, I tried the “hope it will go away” strategy with this problem recently and ended up calling a roofer last week.
• Have you ever seen a problem employee become a solid performer without intervention? Most likely the answer is no. Generally, the problem employee, at best, remains a small problem. At worst, that person infects others in the organization, or does something that seriously endangers the organization’s health or reputation.
• Have you ever had small a problem with a vendor or customer that went unresolved? Perhaps it’s a small billing dispute. As time goes on, it compounds until it becomes a bigger issue. Eventually, solving it involves higher levels of management and possibly consultation with legal counsel.
Hopefully, by now, you can see that the logic in dealing with small problems first is to keep them from becoming big problems later. Fixing problems early usually requires a relatively small (when compared to the amount required to fix it later) amount of time and energy. It’s the difference between putting out a brush fire and putting out a forest fire!
If you feel as if you are constantly dealing with crisis situations, think about whether decisive action early on may have prevented some of these situations from becoming a crisis in the first place. Occasionally, there are some problems that you can “wait out”, but most times the problem only gets worse.
Obviously, I’m not suggesting that anyone ignore big problems in their business, but as we approach the Labor Day weekend, find a few minutes to step back from the day to day issues in your business and consider whether there are some brush fires burning in your business that you can extinguish quickly and easily before they become forest fires!
If your business could benefit from fractional CFO services, I would welcome the chance to speak with you. Please give me a call at (314) 863-6637 or send an email to
your cash is flowing. know where.
Copyright @ 2008 Homza Consulting, Inc.
Ask yourself, is it more likely that a small problem will go away or become a big problem later? I think we all know the answer. It is far more likely that left unattended, the small problem will become a bigger problem later. Just in case you need a few examples to get you started, consider these.
• Have you ever seen a minor roof leak go away? Generally, small leaks turn into bigger leaks. For the record, I tried the “hope it will go away” strategy with this problem recently and ended up calling a roofer last week.
• Have you ever seen a problem employee become a solid performer without intervention? Most likely the answer is no. Generally, the problem employee, at best, remains a small problem. At worst, that person infects others in the organization, or does something that seriously endangers the organization’s health or reputation.
• Have you ever had small a problem with a vendor or customer that went unresolved? Perhaps it’s a small billing dispute. As time goes on, it compounds until it becomes a bigger issue. Eventually, solving it involves higher levels of management and possibly consultation with legal counsel.
Hopefully, by now, you can see that the logic in dealing with small problems first is to keep them from becoming big problems later. Fixing problems early usually requires a relatively small (when compared to the amount required to fix it later) amount of time and energy. It’s the difference between putting out a brush fire and putting out a forest fire!
If you feel as if you are constantly dealing with crisis situations, think about whether decisive action early on may have prevented some of these situations from becoming a crisis in the first place. Occasionally, there are some problems that you can “wait out”, but most times the problem only gets worse.
Obviously, I’m not suggesting that anyone ignore big problems in their business, but as we approach the Labor Day weekend, find a few minutes to step back from the day to day issues in your business and consider whether there are some brush fires burning in your business that you can extinguish quickly and easily before they become forest fires!
If your business could benefit from fractional CFO services, I would welcome the chance to speak with you. Please give me a call at (314) 863-6637 or send an email to
your cash is flowing. know where.
Copyright @ 2008 Homza Consulting, Inc.
Step One (July 2008)
With all of the computing power that has been applied to business over the last 30 years, I sometimes wonder if it has produced any better information!? Yes, we have reams of data but there are times when it serves very little purpose because it is not organized into useful information. As I write this, I can think of two recent examples of companies that produce reports that aren’t of much value. In one case, it was (past tense because it is now fixed) an income statement that was poorly organized and couldn’t produce meaningful customer profitability information. In another case it is (current tense because I just read the report this morning) a summary of weekly activity that can’t be reconciled to resources deployed. Even if one understood this report perfectly, it would add little to understanding the business.
From these two examples, comes the title for this newsletter: “Step One” is to develop meaningful reporting for your business. If you do not have information at hand today, I can assure you that this step will not help your business this week (yes, I said “not”). Generally, useful business information is the result of looking at trends over time and developing an understanding of the relationship between key pieces of information. I think it takes half a dozen time periods (6 weeks of activity reporting and 6 months for income statements, for example) to start to draw meaningful conclusions. But I have almost always found that once you start to look at this information you will see trends and ask questions which will lead to ways to improve the business.
In the first case, we started at the beginning of February and reorganized the income statement effective January 1. When we close June, we will have six months of good data. Yes, the first several months were difficult because it felt like we took a step backwards. We had no trend information as compared to bad trend information previously (even that, I would consider an improvement, however). Bad information serves no purpose other than to distract at best and to mislead at worst. In the other case, we started last week. By the end of July, we’ll have enough information that we should be able to affect the business and have a better result (increased profits) in the third quarter.
One of the reasons that I believe that people don’t focus on better reporting is the lack of immediacy of the result. As I mentioned, it is highly unlikely that working on better reporting this week (the first week of July 2008) will solve any problems before we take our 4th of July break. We tend to be so very short term focused that we spend the majority of our time focusing on the problems of the day as opposed activities that will benefit us in the long run. But that doesn’t mean it’s not worth doing!
Given that it is going to take six months for you to develop good income statement reporting, if you start today, you’ll probably start to identify opportunity areas in your business in three months and have good information by year end. That will allow you to enter 2009 with a strong basis of information and to plan to be more profitable in 2009 than 2008.
Every day that you wait is opportunity (and profits) lost. Don’t delay, take “Step One” today!
If your business could benefit from fractional CFO services, I would welcome the chance to speak with you. Please give me a call at (314) 863-6637 or send an email to
your cash is flowing. know where.
Copyright @ 2010 Homza Consulting, Inc.
From these two examples, comes the title for this newsletter: “Step One” is to develop meaningful reporting for your business. If you do not have information at hand today, I can assure you that this step will not help your business this week (yes, I said “not”). Generally, useful business information is the result of looking at trends over time and developing an understanding of the relationship between key pieces of information. I think it takes half a dozen time periods (6 weeks of activity reporting and 6 months for income statements, for example) to start to draw meaningful conclusions. But I have almost always found that once you start to look at this information you will see trends and ask questions which will lead to ways to improve the business.
In the first case, we started at the beginning of February and reorganized the income statement effective January 1. When we close June, we will have six months of good data. Yes, the first several months were difficult because it felt like we took a step backwards. We had no trend information as compared to bad trend information previously (even that, I would consider an improvement, however). Bad information serves no purpose other than to distract at best and to mislead at worst. In the other case, we started last week. By the end of July, we’ll have enough information that we should be able to affect the business and have a better result (increased profits) in the third quarter.
One of the reasons that I believe that people don’t focus on better reporting is the lack of immediacy of the result. As I mentioned, it is highly unlikely that working on better reporting this week (the first week of July 2008) will solve any problems before we take our 4th of July break. We tend to be so very short term focused that we spend the majority of our time focusing on the problems of the day as opposed activities that will benefit us in the long run. But that doesn’t mean it’s not worth doing!
Given that it is going to take six months for you to develop good income statement reporting, if you start today, you’ll probably start to identify opportunity areas in your business in three months and have good information by year end. That will allow you to enter 2009 with a strong basis of information and to plan to be more profitable in 2009 than 2008.
Every day that you wait is opportunity (and profits) lost. Don’t delay, take “Step One” today!
If your business could benefit from fractional CFO services, I would welcome the chance to speak with you. Please give me a call at (314) 863-6637 or send an email to
your cash is flowing. know where.
Copyright @ 2010 Homza Consulting, Inc.
It's A System . . . (June 2008)
It’s A System . . .
A business is a system. Much like a mechanical system or the human body, if one part is not working it puts pressure on all the others. If you think about your own business this way, I’ll bet you’ll find that it’s true.
As I tend to get calls from businesses that are struggling, I probably see this more than most. The breakdown of a business system shows up in the numbers, but finances are a reflection of the business functioning. Show me a business that functions smoothly and efficiently, and it will likely be profitable. Show me one that struggles with day to day issues and I’ll bet the financial performance will reflect that as well.
While each business is different, most have sales (closing the deal), marketing (getting the word out), customer service (resolving issues or providing support), “product” (those responsible for actually producing a product or delivering a service), accounting/finance (adding up the numbers at its very simplest), information technology (keeping us all connected) and management & administrative (overseeing all of the other functions). Your business might also have R&D (research & development) or some other function(s).
Now, imagine if one of the areas just stopped. If no one delivered a product or service, revenue would dry up pretty quickly. If accounting didn’t send out bills and take payments, then the bank account would soon empty. If the sales department doesn’t close new business, the top-line will drop. Even if building services quits emptying the waste baskets and cleaning the office, the place would soon become a mess and it would impact the entire organization.
The examples stated above are obviously extreme; usually an entire department doesn’t just stop working. However, it’s not so uncommon for departments to be operating at less than full capacity and maybe not even meeting minimum job requirements. When this happens, it puts pressure on every part of the organization.
When the sales department isn’t “making its numbers”, profits drop. This may result in a cutback on resources and make it harder for those delivering products or services to do their jobs. Accounting may stretch payables. This results in calls from unhappy vendors. This takes time and further affects the organizations ability to “get the job done”.
Maybe those delivering the product or service don’t do a good job; as a result, sales suffer. Customers may withhold payment. There will be more complaint calls. Management will step in to deal with the issue of the day rather than planning the future.
The problem can start anywhere. When you see it, it’s not so much about where it started as it is about getting a handle on it and stopping it. That is clearly easier said than done. If you’re fortunate enough to see it starting, nip it in the bud. It doesn’t take long before it will infect the entire organization! If your business is struggling, think of it as a system . . . it might provide a new perspective!
If your business could benefit from fractional CFO services, I would welcome the chance to speak with you. Please give me a call at (314) 863-6637 or send an email to
your cash is flowing. know where.
Copyright @ 2008 Homza Consulting, Inc.
A business is a system. Much like a mechanical system or the human body, if one part is not working it puts pressure on all the others. If you think about your own business this way, I’ll bet you’ll find that it’s true.
As I tend to get calls from businesses that are struggling, I probably see this more than most. The breakdown of a business system shows up in the numbers, but finances are a reflection of the business functioning. Show me a business that functions smoothly and efficiently, and it will likely be profitable. Show me one that struggles with day to day issues and I’ll bet the financial performance will reflect that as well.
While each business is different, most have sales (closing the deal), marketing (getting the word out), customer service (resolving issues or providing support), “product” (those responsible for actually producing a product or delivering a service), accounting/finance (adding up the numbers at its very simplest), information technology (keeping us all connected) and management & administrative (overseeing all of the other functions). Your business might also have R&D (research & development) or some other function(s).
Now, imagine if one of the areas just stopped. If no one delivered a product or service, revenue would dry up pretty quickly. If accounting didn’t send out bills and take payments, then the bank account would soon empty. If the sales department doesn’t close new business, the top-line will drop. Even if building services quits emptying the waste baskets and cleaning the office, the place would soon become a mess and it would impact the entire organization.
The examples stated above are obviously extreme; usually an entire department doesn’t just stop working. However, it’s not so uncommon for departments to be operating at less than full capacity and maybe not even meeting minimum job requirements. When this happens, it puts pressure on every part of the organization.
When the sales department isn’t “making its numbers”, profits drop. This may result in a cutback on resources and make it harder for those delivering products or services to do their jobs. Accounting may stretch payables. This results in calls from unhappy vendors. This takes time and further affects the organizations ability to “get the job done”.
Maybe those delivering the product or service don’t do a good job; as a result, sales suffer. Customers may withhold payment. There will be more complaint calls. Management will step in to deal with the issue of the day rather than planning the future.
The problem can start anywhere. When you see it, it’s not so much about where it started as it is about getting a handle on it and stopping it. That is clearly easier said than done. If you’re fortunate enough to see it starting, nip it in the bud. It doesn’t take long before it will infect the entire organization! If your business is struggling, think of it as a system . . . it might provide a new perspective!
If your business could benefit from fractional CFO services, I would welcome the chance to speak with you. Please give me a call at (314) 863-6637 or send an email to
your cash is flowing. know where.
Copyright @ 2008 Homza Consulting, Inc.
Subscribe to:
Posts (Atom)
