Last month, I wrote “What Got You Here, Won’t Get You There!” and suggested that no matter the status of your business, it would take different actions to get to the next level. One frequently used management tool used to gauge action is to ask an employee “What are you doing?” But the more important question is, “What’s the result of what you are doing?”
If you’re working at Dobbs Tire & Auto Centers installing tires on a customer’s car, for example, the link between action and result is pretty clear. Once the tires are on and the car is off the lift, the customer is going to pull out a credit card and the company will have earned revenue (and profit margin assuming that they have a good understanding of their costs and have priced their product appropriately).
But many of us work in office environments, and the link between job tasks and result is far less clear. To further complicate matters, the link between physical action and what someone is actually doing can be almost none existent. While it’s pretty easy to see what the person at Dobbs is doing, it’s often not possible to tell what the person sitting in front of a computer screen is actually doing! It could be anything from highly valuable work to playing Solitaire; the latter being one of the reasons management asks “What are you dong?” and is comforted by any answer that sounds like work!
But I would suggest that it’s far important to consider the value of the tasks being performed, not just whether they fit into the broad category of “work”. After all, that is the category where the vast majority of time (and therefore dollars) is spent.
If someone in marketing is sending out a direct mail campaign. Management should know the response rate, the number of eventual customers, and the resulting profit margin. How do these numbers compare to the cost of the campaign itself?
If someone is producing a report, then management should understand both how that report is used in decision making (assuming that it is used) and the cost of producing it. In large companies, a frequently used tactic to understand how reports are used is “the scream test”. This is accomplished when someone stops sending out the reports and simply waits to see who screams about it! It’s remarkable how little screaming is actually heard.
So, instead of asking “What are you doing?” consider expanding that question by adding “And what is the result?” How does it add value to the company? Does it directly result in revenue or lower expenses? Does it fulfill some regulatory need? Does it provide valuable information to management to allow for decision making? Does it serve the customer?
As we enter another work week, take a moment to ask yourself and those around you:
What are you doing? What’s the result?
If you need help with your business, financial plans, or goal setting, please give me a call at (314) 863-6637 or send an email to And, remember . . .
your cash is flowing. know where.
Copyright @ 2007 Homza Consulting, Inc.
Monday, March 1, 2010
What Got You Here, Won't Get You There! (September 2007)
“What Got You Here, Won’t Get You There!” Those are words worth thinking about. When I heard them recently, they struck me. In part, they struck because it was at a 6:00 AM Bootcamp run by Keath Hausher, President of Shark Fitness Training Company. When you’re training at that hour of the morning with about fifty other people, you tend to have the sense that you are doing everything you can to stay healthy. But to be truthful, I’ve reached a plateau. And to get to “the next level”, whatever that is, I have to do more!
The same is true in business. The actions you have taken to get where you are today (wherever that may be) will not get you to the next level. To some that is good news; to others it’s probably not! To constantly, measurably improve, you’re going to have to do more. But rather than be discouraged, those same words can be inspirational. Whether your business is performing well or poorly, taking different action is the key to changing your result.
Think about your business and the number of things that you are doing the way “they’ve always been done”. Some of those may be fine, but people, practices and processes may have long since served their purpose and may actually be holding you back.
• Reports that once served to answer an important question are still being produced even though the question may be irrelevant. New reporting to answer questions of the day may not have been instituted because the “old stuff” is taking up so much time.
• Processes that seemed efficient yesterday, may seem slow today. It wasn’t that long ago that fax machines were the fastest way to send information. Now, it seems we only fax something when someone doesn’t have access to their email!
• Finally, and among the most difficult, employees who were important to the business in its early stages may not have grown with the company, and may now be holding the company back. While it can be personally troubling to some, not everyone grows with an organization. The top marketing person for a $1 million dollar business might not be the right person when that same business reaches $10 million, $20 million or more.
There is a difference between “staying the course” and “ending up in a rut”. In order to move to the next level, in any endeavor, you have to challenge yourself and those around you to do more than yesterday. In business, competition is fierce and you can be assured that your competitors are trying to pass you by. Don’t make it easy for them. Challenge yourself to stay one step ahead and move to the next level.
What are you going to do differently today!?
If you need help with your business, financial plans, or goal setting, please give me a call at (314) 863-6637 or send an email to And, remember . . . Your Cash Is Flowing. Know Where.
Copyright @ 2007 Homza Consulting, Inc.
The same is true in business. The actions you have taken to get where you are today (wherever that may be) will not get you to the next level. To some that is good news; to others it’s probably not! To constantly, measurably improve, you’re going to have to do more. But rather than be discouraged, those same words can be inspirational. Whether your business is performing well or poorly, taking different action is the key to changing your result.
Think about your business and the number of things that you are doing the way “they’ve always been done”. Some of those may be fine, but people, practices and processes may have long since served their purpose and may actually be holding you back.
• Reports that once served to answer an important question are still being produced even though the question may be irrelevant. New reporting to answer questions of the day may not have been instituted because the “old stuff” is taking up so much time.
• Processes that seemed efficient yesterday, may seem slow today. It wasn’t that long ago that fax machines were the fastest way to send information. Now, it seems we only fax something when someone doesn’t have access to their email!
• Finally, and among the most difficult, employees who were important to the business in its early stages may not have grown with the company, and may now be holding the company back. While it can be personally troubling to some, not everyone grows with an organization. The top marketing person for a $1 million dollar business might not be the right person when that same business reaches $10 million, $20 million or more.
There is a difference between “staying the course” and “ending up in a rut”. In order to move to the next level, in any endeavor, you have to challenge yourself and those around you to do more than yesterday. In business, competition is fierce and you can be assured that your competitors are trying to pass you by. Don’t make it easy for them. Challenge yourself to stay one step ahead and move to the next level.
What are you going to do differently today!?
If you need help with your business, financial plans, or goal setting, please give me a call at (314) 863-6637 or send an email to And, remember . . . Your Cash Is Flowing. Know Where.
Copyright @ 2007 Homza Consulting, Inc.
Accounting versus Financial Management (August 2007)
I am constantly amazed at the number of people who can’t or don’t distinguish between accounting and financial management. It’s no surprise, I guess! Even in big companies, the terms “accountingandfinance” are often run together as if they are one word. They are not; and the differences are important.
First, let me say that I think very highly of accountants! My brother is a CPA (Certified Public Accountant) and he’s a great guy. But like most people, he has a certain area of expertise. His is audit, particularly in the financial services industry. When I have an audit or control question, I always call him. But he’s not a tax expert nor does he pretend to be.
Most companies hire a CPA for their tax expertise. They generally do a fine job of the tasks they are asked to perform and may even be capable of doing an excellent job of financial management. But, too often, businesses visit their CPA only at tax time with the goal of completing the necessary forms and calculating their minimum tax burden. Obviously, this needs to be done. But this is very different than financial management of the company!
Financial management is about understanding changes in financial performance from month to month, quarter to quarter, and so on. It also involves the daily decision making about how resources are deployed within an organization (read “resources” as “money”). This involves either decisions to spend money for operating expenses, long term capital investments, or schedule employees! Often, those running a company forget that one of their biggest controllable costs (and therefore their biggest levers to change the expenses of the business) is labor.
As I write this, I am looking at the financial statements for a business for the first seven months of the year. You can tell that they don’t seek professional guidance to help them produce their monthly financial statements. Raw materials costs vary wildly by month because they charge purchases directly to Costs of Goods Sold without taking into account changes in inventory. Labor also varies monthly, and doesn’t appear to be managed tightly to the volume of business that occurs during the month. Nor do they accrue labor expenses appropriately (so a month with five Fridays has higher payroll than a month with four Fridays). Several expense line items have credits in various months, reflecting “negative” expenses thereby distorting the income in the period. Finally, expenses that should be relatively fixed each month vary substantially.
For me, or anyone who knows how to read financial statements, it raises multiple questions . . . the answers to many will likely raise more questions! But that’s precisely how one improves any company’s financial reporting process . . . and finds increased profits in the process.
Do you have solid Financial Management?
If you need help with your business, financial plans, or goal setting, please give me a call at (314) 863-6637 or send an email to And, remember . . . Your Cash Is Flowing. Know Where.
Copyright @ 2010 Homza Consulting, Inc.
First, let me say that I think very highly of accountants! My brother is a CPA (Certified Public Accountant) and he’s a great guy. But like most people, he has a certain area of expertise. His is audit, particularly in the financial services industry. When I have an audit or control question, I always call him. But he’s not a tax expert nor does he pretend to be.
Most companies hire a CPA for their tax expertise. They generally do a fine job of the tasks they are asked to perform and may even be capable of doing an excellent job of financial management. But, too often, businesses visit their CPA only at tax time with the goal of completing the necessary forms and calculating their minimum tax burden. Obviously, this needs to be done. But this is very different than financial management of the company!
Financial management is about understanding changes in financial performance from month to month, quarter to quarter, and so on. It also involves the daily decision making about how resources are deployed within an organization (read “resources” as “money”). This involves either decisions to spend money for operating expenses, long term capital investments, or schedule employees! Often, those running a company forget that one of their biggest controllable costs (and therefore their biggest levers to change the expenses of the business) is labor.
As I write this, I am looking at the financial statements for a business for the first seven months of the year. You can tell that they don’t seek professional guidance to help them produce their monthly financial statements. Raw materials costs vary wildly by month because they charge purchases directly to Costs of Goods Sold without taking into account changes in inventory. Labor also varies monthly, and doesn’t appear to be managed tightly to the volume of business that occurs during the month. Nor do they accrue labor expenses appropriately (so a month with five Fridays has higher payroll than a month with four Fridays). Several expense line items have credits in various months, reflecting “negative” expenses thereby distorting the income in the period. Finally, expenses that should be relatively fixed each month vary substantially.
For me, or anyone who knows how to read financial statements, it raises multiple questions . . . the answers to many will likely raise more questions! But that’s precisely how one improves any company’s financial reporting process . . . and finds increased profits in the process.
Do you have solid Financial Management?
If you need help with your business, financial plans, or goal setting, please give me a call at (314) 863-6637 or send an email to And, remember . . . Your Cash Is Flowing. Know Where.
Copyright @ 2010 Homza Consulting, Inc.
Who's The "Push"? (July 2007)
Last Month, I said that almost any business could be fixed or improved if only those in charge had the will to do so. This month, I’m continuing on that theme. When I was 15 years old I worked the summer splitting my time between two contractors. To this day, I remember some of the lessons learned on those jobs. Yes, some of those lessons have served me well living in an older University City home, but more of them have served me well in dealing with people and business issues.
I remember being called aside by the boss one day when he was leaving and he told me that I needed to be the “Push” while he was gone! “What’s the Push?” was my obvious question. He explained to me that on any job, the “Push” is the one person responsible for setting the tone and pushing people to get things accomplished!
People tend to excel when challenged to do more. While some naturally push themselves to accomplish as much as possible, others need an external “push” to do their best. I tend to be very competitive by nature, and I know that I work better with a team of equally motivated individuals.
Years later, as I look at small businesses that are languishing (and frankly, think back on my experiences within large organizations); the problem with many is that they have no “Push”! No one is setting the tone or holding people accountable within the organization for goals and objectives. Usually, someone filled this role at one point. But as time has gone by, that person has either left the organization or lost their enthusiasm for the business. The result is an organization that lacks drive.
Employees show up at work, perform their tasks in a routine manner, and walk out the door at the end of the day. Sometimes it’s a problem with the rewards system (or lack thereof), other times it’s a problem with a few “rotten apples”, and still others it is the example set at the top. But whatever the cause of the problem, the results show up on the financial statements.
So, the next time that you sit down and look at your financial statements (why not do it today?), ask yourself if you’re getting all that you can from your business.
If you have a business with no “Push”, then you have a business that is not achieving its revenue potential and has too much cost in the system. If you wonder why you’re not generating the cash flow that you think you should (or that you once did in the past), then perhaps part of the answer lies in the question: “Who’s The Push?”
If you need help with your business, financial plans, or goal setting, please give me a call at (314) 863-6637 or send an email to ken@homza.com And, remember . . . Your Cash Is Flowing. Know Where.
Last Month, I said that almost any business could be fixed or improved if only those in charge had the will to do so. This month, I’m continuing on that theme. When I was 15 years old I worked the summer splitting my time between two contractors. To this day, I remember some of the lessons learned on those jobs. Yes, some of those lessons have served me well living in an older University City home, but more of them have served me well in dealing with people and business issues.
I remember being called aside by the boss one day when he was leaving and he told me that I needed to be the “Push” while he was gone! “What’s the Push?” was my obvious question. He explained to me that on any job, the “Push” is the one person responsible for setting the tone and pushing people to get things accomplished!
People tend to excel when challenged to do more. While some naturally push themselves to accomplish as much as possible, others need an external “push” to do their best. I tend to be very competitive by nature, and I know that I work better with a team of equally motivated individuals.
Years later, as I look at small businesses that are languishing (and frankly, think back on my experiences within large organizations); the problem with many is that they have no “Push”! No one is setting the tone or holding people accountable within the organization for goals and objectives. Usually, someone filled this role at one point. But as time has gone by, that person has either left the organization or lost their enthusiasm for the business. The result is an organization that lacks drive.
Employees show up at work, perform their tasks in a routine manner, and walk out the door at the end of the day. Sometimes it’s a problem with the rewards system (or lack thereof), other times it’s a problem with a few “rotten apples”, and still others it is the example set at the top. But whatever the cause of the problem, the results show up on the financial statements.
So, the next time that you sit down and look at your financial statements (why not do it today?), ask yourself if you’re getting all that you can from your business.
If you have a business with no “Push”, then you have a business that is not achieving its revenue potential and has too much cost in the system. If you wonder why you’re not generating the cash flow that you think you should (or that you once did in the past), then perhaps part of the answer lies in the question: “Who’s The Push?”
If you need help with your business, financial plans, or goal setting, please give me a call at (314) 863-6637 or send an email to And, remember . . . Your Cash Is Flowing. Know Where.
Copyright @ 2007 Homza Consulting, Inc.
I remember being called aside by the boss one day when he was leaving and he told me that I needed to be the “Push” while he was gone! “What’s the Push?” was my obvious question. He explained to me that on any job, the “Push” is the one person responsible for setting the tone and pushing people to get things accomplished!
People tend to excel when challenged to do more. While some naturally push themselves to accomplish as much as possible, others need an external “push” to do their best. I tend to be very competitive by nature, and I know that I work better with a team of equally motivated individuals.
Years later, as I look at small businesses that are languishing (and frankly, think back on my experiences within large organizations); the problem with many is that they have no “Push”! No one is setting the tone or holding people accountable within the organization for goals and objectives. Usually, someone filled this role at one point. But as time has gone by, that person has either left the organization or lost their enthusiasm for the business. The result is an organization that lacks drive.
Employees show up at work, perform their tasks in a routine manner, and walk out the door at the end of the day. Sometimes it’s a problem with the rewards system (or lack thereof), other times it’s a problem with a few “rotten apples”, and still others it is the example set at the top. But whatever the cause of the problem, the results show up on the financial statements.
So, the next time that you sit down and look at your financial statements (why not do it today?), ask yourself if you’re getting all that you can from your business.
If you have a business with no “Push”, then you have a business that is not achieving its revenue potential and has too much cost in the system. If you wonder why you’re not generating the cash flow that you think you should (or that you once did in the past), then perhaps part of the answer lies in the question: “Who’s The Push?”
If you need help with your business, financial plans, or goal setting, please give me a call at (314) 863-6637 or send an email to ken@homza.com And, remember . . . Your Cash Is Flowing. Know Where.
Last Month, I said that almost any business could be fixed or improved if only those in charge had the will to do so. This month, I’m continuing on that theme. When I was 15 years old I worked the summer splitting my time between two contractors. To this day, I remember some of the lessons learned on those jobs. Yes, some of those lessons have served me well living in an older University City home, but more of them have served me well in dealing with people and business issues.
I remember being called aside by the boss one day when he was leaving and he told me that I needed to be the “Push” while he was gone! “What’s the Push?” was my obvious question. He explained to me that on any job, the “Push” is the one person responsible for setting the tone and pushing people to get things accomplished!
People tend to excel when challenged to do more. While some naturally push themselves to accomplish as much as possible, others need an external “push” to do their best. I tend to be very competitive by nature, and I know that I work better with a team of equally motivated individuals.
Years later, as I look at small businesses that are languishing (and frankly, think back on my experiences within large organizations); the problem with many is that they have no “Push”! No one is setting the tone or holding people accountable within the organization for goals and objectives. Usually, someone filled this role at one point. But as time has gone by, that person has either left the organization or lost their enthusiasm for the business. The result is an organization that lacks drive.
Employees show up at work, perform their tasks in a routine manner, and walk out the door at the end of the day. Sometimes it’s a problem with the rewards system (or lack thereof), other times it’s a problem with a few “rotten apples”, and still others it is the example set at the top. But whatever the cause of the problem, the results show up on the financial statements.
So, the next time that you sit down and look at your financial statements (why not do it today?), ask yourself if you’re getting all that you can from your business.
If you have a business with no “Push”, then you have a business that is not achieving its revenue potential and has too much cost in the system. If you wonder why you’re not generating the cash flow that you think you should (or that you once did in the past), then perhaps part of the answer lies in the question: “Who’s The Push?”
If you need help with your business, financial plans, or goal setting, please give me a call at (314) 863-6637 or send an email to And, remember . . . Your Cash Is Flowing. Know Where.
Copyright @ 2007 Homza Consulting, Inc.
It's About Will! (June 2007)
Last Month, I suggested that businesses need to be accountable to the facts! This month, I’d like to suggest that when it comes to solving problems, “It’s About Will”!
Any business can be fixed! Now, that’s a bold statement and might be hard to believe. And while there are no doubt exceptions, as a general rule, I believe that most businesses can be fixed or substantially improved.
In almost every situation where I’ve seen a business languish, it’s because the “powers that be” simply don’t have the will to fix the problem(s). There are three issues that must be faced in addressing any problem.
- Define: Truly knowing and understanding the problem based upon facts,
- Solve: Developing one or more cost effective solutions, and
- Implement: Taking action or fixing the problem.
In most organizations, almost everyone thinks they know the problem(s) as well as the potential solutions. Often, however, they lack the hard evidence needed to gain agreement (either in the form of organization consensus or executive buy-in) of the problem definition. The issue never gets resolved because there are so many differing opinions as to what the problem is! This is one of the reasons I am such a big advocate of having “fact based discussions.”
The next level of difficulty, of course, is the solution. Often, people spend so much time griping about the problem, they spend almost no time on the possible solutions. There is a huge difference between analyzing a problem along with the potential solutions and simply complaining about it. Anecdotal evidence (i.e., stories and company legend) is no substitute for analysis. Generally, if you can gain agreement around the definition of the problem, you will have made substantial progress toward developing potential solutions.
Taking action is truly the hard part! Taking action requires the will of the key player(s) to make the hard decisions. When an organization fails to take action, it is often because the minor day to day annoying pain of any problem seems to pale in comparison to the perceived gut wrenching pain of a major organizational change. It’s like that noise in your car that you hear every day. You know something is wrong, but it doesn’t “appear” to be causing any major problems (although it usually is!). Then, one day, the transmission falls out and that’s a major problem! The same holds true in companies. Those which appear to be small problems chip away at the health of the organization on a daily basis. Over time, the impact is enormous.
If your business is languishing, or it’s flourishing but you’re not sure it’s living up to its true potential, think about solving some of those “small” problems in your organization.
Do You Have The Will To Solve Problems?
If you need help with your business, financial plans, or goal setting, please give me a call at (314) 863-6637 or send an email to And, remember . . .
Your Cash Is Flowing. Know Where.
Copyright @ 2007 Homza Consulting, Inc.
Any business can be fixed! Now, that’s a bold statement and might be hard to believe. And while there are no doubt exceptions, as a general rule, I believe that most businesses can be fixed or substantially improved.
In almost every situation where I’ve seen a business languish, it’s because the “powers that be” simply don’t have the will to fix the problem(s). There are three issues that must be faced in addressing any problem.
- Define: Truly knowing and understanding the problem based upon facts,
- Solve: Developing one or more cost effective solutions, and
- Implement: Taking action or fixing the problem.
In most organizations, almost everyone thinks they know the problem(s) as well as the potential solutions. Often, however, they lack the hard evidence needed to gain agreement (either in the form of organization consensus or executive buy-in) of the problem definition. The issue never gets resolved because there are so many differing opinions as to what the problem is! This is one of the reasons I am such a big advocate of having “fact based discussions.”
The next level of difficulty, of course, is the solution. Often, people spend so much time griping about the problem, they spend almost no time on the possible solutions. There is a huge difference between analyzing a problem along with the potential solutions and simply complaining about it. Anecdotal evidence (i.e., stories and company legend) is no substitute for analysis. Generally, if you can gain agreement around the definition of the problem, you will have made substantial progress toward developing potential solutions.
Taking action is truly the hard part! Taking action requires the will of the key player(s) to make the hard decisions. When an organization fails to take action, it is often because the minor day to day annoying pain of any problem seems to pale in comparison to the perceived gut wrenching pain of a major organizational change. It’s like that noise in your car that you hear every day. You know something is wrong, but it doesn’t “appear” to be causing any major problems (although it usually is!). Then, one day, the transmission falls out and that’s a major problem! The same holds true in companies. Those which appear to be small problems chip away at the health of the organization on a daily basis. Over time, the impact is enormous.
If your business is languishing, or it’s flourishing but you’re not sure it’s living up to its true potential, think about solving some of those “small” problems in your organization.
Do You Have The Will To Solve Problems?
If you need help with your business, financial plans, or goal setting, please give me a call at (314) 863-6637 or send an email to And, remember . . .
Your Cash Is Flowing. Know Where.
Copyright @ 2007 Homza Consulting, Inc.
Be Accountable to the Facts! (May 2007)
Last Month, I discussed organizations that were “avoiding profits” by avoiding conflict. While there are some that thrive on conflict, I think it’s fair to say that most people prefer to avoid it. However, business conflict doesn’t have to be confrontational, disagreeable or argumentative if people start with the facts! That is why solid reporting of business results (both financial and non-financial measures) is critical to the health of the organization.
Rather than discussing differing points of view and arguing over vague and accusatory sounding statements, a much more rationale discussion can be had if both parties have the facts and are literally looking at the same sheet of paper. Let’s look at a few examples:
An employee tends to show up late and leave early while still clocking 40 hours. Rather than confront the employee with a statement such as “you’re always late”, present them with actual hours for a week and ask them “Why they should be paid for time they didn’t work?” Most likely, they’ll agree with you!
A customer recently questioned whether a vendor could handle the business. The customer feared that the vendor would be “swamped” because they had “a lot” of product to ship. Upon further probing, the vendor learned that the order wouldn’t even amount to half a truckload per week (whereas they consider a truckload per day a big customer).
Customer service staff report that everything is “under control” yet the facts report that customers are on hold for nearly an hour. If there were a proper reporting of call statistics, there would be no debate.
I talk to many companies about their performance. It’s amazing how few times someone can speak using numbers and percentages. Rather, it’s we’re doing “great”, or worse, “OK”, which means they probably don’t really know how they are doing.
Recently I attended the annual military skills competition at the United States Military Academy at West Point. Arguably, this is the most accountable place on the face of the earth. This trip serves as my annual reminder of what accountability really means! Many businesses could learn lessons of accountability
To Avoid Conflict, Don’t Avoid the Issue! Just Talk Numbers! You’ll take both the emotion and the conflict out of the discussion!
If you need help with your business, financial plans, or goal setting, please give me a call at (314) 863-6637 or send an email to And, remember . . . Your Cash Is Flowing. Know Where.
Copyright @ 2007 Homza Consulting, Inc.
Rather than discussing differing points of view and arguing over vague and accusatory sounding statements, a much more rationale discussion can be had if both parties have the facts and are literally looking at the same sheet of paper. Let’s look at a few examples:
An employee tends to show up late and leave early while still clocking 40 hours. Rather than confront the employee with a statement such as “you’re always late”, present them with actual hours for a week and ask them “Why they should be paid for time they didn’t work?” Most likely, they’ll agree with you!
A customer recently questioned whether a vendor could handle the business. The customer feared that the vendor would be “swamped” because they had “a lot” of product to ship. Upon further probing, the vendor learned that the order wouldn’t even amount to half a truckload per week (whereas they consider a truckload per day a big customer).
Customer service staff report that everything is “under control” yet the facts report that customers are on hold for nearly an hour. If there were a proper reporting of call statistics, there would be no debate.
I talk to many companies about their performance. It’s amazing how few times someone can speak using numbers and percentages. Rather, it’s we’re doing “great”, or worse, “OK”, which means they probably don’t really know how they are doing.
Recently I attended the annual military skills competition at the United States Military Academy at West Point. Arguably, this is the most accountable place on the face of the earth. This trip serves as my annual reminder of what accountability really means! Many businesses could learn lessons of accountability
To Avoid Conflict, Don’t Avoid the Issue! Just Talk Numbers! You’ll take both the emotion and the conflict out of the discussion!
If you need help with your business, financial plans, or goal setting, please give me a call at (314) 863-6637 or send an email to And, remember . . . Your Cash Is Flowing. Know Where.
Copyright @ 2007 Homza Consulting, Inc.
Are You Avoiding Profits? (April 2007)
Last Month, I discussed the definition of “profit”, defining the term as a return on capital and explaining that many times, small business owners don’t have a clear picture of their profitability as they tend to subsidize the business with below market labor, interest free loans, or otherwise don’t properly record all of the costs of running the business.
This month, I’d like to discuss what causes profit, or in some instances, the lack thereof!
Most under performing businesses that I see don’t suffer from a lack of market demand, intense competition, or other external factor. Most under performing businesses suffer from a lack of accountability within the organization. I believe that accountability causes profits and a lack of accountability can most assuredly cause a lack of profits!
While I grant you that it might not always be true that an accountable organization will be a profitable organization, I would argue that a lack of accountability will certainly cause a lack of profits (meaning that the organization will actually be losing money or could be making much more).
Just as Einstein discovered E=mc2, I have discovered that: A Lack of Accountability Will Cause a Lack of Profits! While I realize that a comparison to Einstein is a somewhat bold and outrageous statement, surely there is sufficient anecdotal evidence in most businesses to see what happens when people aren’t held accountable. Generally, everyone suffers -- employees, stockholders, suppliers and customers.
While some of those constituencies might feel as though they are held hostage to the lack of accountability, it’s rare that they don’t have the ability to go somewhere else! Employees can find another job, stockholders can sell their shares or choose not to invest more resources, suppliers can charge extra for the difficulty they have dealing with an unaccountable organization, and customers most certainly will choose to spend their money elsewhere! Given sufficient time, all of them will ultimately make another choice.
What causes this lack of accountability? Often it is a desire not to deal with conflict. I believe, however, that conflict (at least constructive conflict) is good. It causes people to clarify their beliefs, expectations, positions and views about how everyone in the organization fulfills their roles and responsibilities and how the organization serves customers.
If you’re avoiding the conflict that comes with accountability, then you’re avoiding profits!
Are you avoiding profits?
If you need help with your business, financial plans, or goal setting, please give me a call at (314) 863-6637 or send an email to And, remember . . . Your Cash Is Flowing. Know Where.
Copyright @ 2007 Homza Consulting, Inc.
This month, I’d like to discuss what causes profit, or in some instances, the lack thereof!
Most under performing businesses that I see don’t suffer from a lack of market demand, intense competition, or other external factor. Most under performing businesses suffer from a lack of accountability within the organization. I believe that accountability causes profits and a lack of accountability can most assuredly cause a lack of profits!
While I grant you that it might not always be true that an accountable organization will be a profitable organization, I would argue that a lack of accountability will certainly cause a lack of profits (meaning that the organization will actually be losing money or could be making much more).
Just as Einstein discovered E=mc2, I have discovered that: A Lack of Accountability Will Cause a Lack of Profits! While I realize that a comparison to Einstein is a somewhat bold and outrageous statement, surely there is sufficient anecdotal evidence in most businesses to see what happens when people aren’t held accountable. Generally, everyone suffers -- employees, stockholders, suppliers and customers.
While some of those constituencies might feel as though they are held hostage to the lack of accountability, it’s rare that they don’t have the ability to go somewhere else! Employees can find another job, stockholders can sell their shares or choose not to invest more resources, suppliers can charge extra for the difficulty they have dealing with an unaccountable organization, and customers most certainly will choose to spend their money elsewhere! Given sufficient time, all of them will ultimately make another choice.
What causes this lack of accountability? Often it is a desire not to deal with conflict. I believe, however, that conflict (at least constructive conflict) is good. It causes people to clarify their beliefs, expectations, positions and views about how everyone in the organization fulfills their roles and responsibilities and how the organization serves customers.
If you’re avoiding the conflict that comes with accountability, then you’re avoiding profits!
Are you avoiding profits?
If you need help with your business, financial plans, or goal setting, please give me a call at (314) 863-6637 or send an email to And, remember . . . Your Cash Is Flowing. Know Where.
Copyright @ 2007 Homza Consulting, Inc.
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