Are you getting what you need from your Finance department or are you making do?
If you feel the information you are getting from your finance department is not helping you with the day to day running of your business try considering asking in a different way. The following ways will help you to ensure that you are getting the right management information you need.
1: Be Specific on what you will use the information for.
You may not know exactly what the information you need looks like but try to decide what you will use the information for. This will help your accountant or finance role to assess what information will need to be captured in order to give you the information you need.
2: Give parameters for the data.
When asking for different information make sure that you do not start an industry in generating different figures for your wants. Set targets for when you want the data to you by. If it is a regular need set it in terms of a set working day in the month. e.g. 3 working days after the last day of the month. Set levels of rounding required as this will also help in ensuring this does not generate excessive additional work. E.g. Figures can be rounded to the nearest £100 will prevent time consuming reconciliations to be made where the figures are slightly out. Set parameters around what should be included or maybe excluded (e.g. all items that have an impact of less than £500 can be excluded)
3: Give feedback on the existing information being provided.
Don’t be afraid to give feedback on the existing information that is being passed to you from your finance department. If you genuinely do not use the information you need to tell them so that they can stop providing this or adapt it to make it more meaningful to you. All reporting takes up valuable time and if you are going to be asking for new information then you also need to help with reducing the existing workload, where it is not adding value.
4: Confirm your expectation on the service you expect.
A finance department that is spending 3 week to produce the month end figures and then spends the final week filing, catching up and producing external reporting requirements will not be providing you with the essential time you need to review discuss and assess management information which helps you with the day to day running of the business. A target should be set to the finance department on how much time you need for them to provide the value adding information that will help the business to grow and increase its profitability. This information is forward looking and will include forecasts and scenarios on potential future performance. It is not unreasonable to ask the finance department to work towards having 50% of their time to work on this value adding information provision. By setting a targeted time you force your finance department to engage in really thinking about where they are spending their time and where they need to rationalise and improve.
5: Measure performance on Service.
Where you have set the targets to measure how well your finance department is meeting expectations, make sure they report back to you on a monthly basis on their progress towards this. The old saying ‘what gets measure gets done’ in my experience is all too true. When people know that the results are being measured and reviewed on a regular basis this will prioritise this as important and needs to be worked on and delivered. Where no progress is made, take action. Where progress is made, celebrate.
6: Don’t wait for the Finance role to leave.
As mad as it sounds, business owners will often not take the opportunity to get what they need from Finance. In many instances I have seen where the present finance role leaves they seize this as an opportunity to recruit to a different job specification to the current incumbent. As the owner or manager of the business it is important to take action now. Reset expectations and measure. Not having the right information to run your business will be costing you time and money.