In our Breaking Barriers series, we put your questions to our team of growth and scaleup advisors. In this edition, we speak to Alun, BICs Finance Director.
Alun is a Chartered Management Accountant with over 40 years’ experience in finance from hands-on operation of financial systems to financial directorship of a FTSE 250 company, and management of subsidiary companies. His experience, however, is not limited to the large company sector. For the past fifteen years, he has been working with start-ups and SMEs providing strategic business advice, furnishing business plans, modelling financial projections, and providing a range of financial and business services.
Q. I’m becoming more desk-bound as my company grows but still need to know what’s going on. How could I develop a management information system that keeps me informed without being constantly at the “coal face”?
A. You’ve already identified a truism of business growth: the boss can’t do everything! The first step might be to decide what you like doing and what you don’t like doing – which frequently aligns with what you’re good at and what you’re not good at. Once you know that you’ll know what you want others to do.
As you are growing, you are probably recruiting new employees. Are you recruiting ones with those skills that you wish to delegate? Which brings us to another business growth truism – always recruit people that are better than you!
But now let’s assume that you are behind that desk and don’t have as much time as before to be in direct touch with operations. So, what do you want to know? A much overused expression – but what are your key performance indicators? As a guide, these are indicators that would influence your decision making. Try writing them down and decide where the information might come from.
In large organisations, the production of management information – be it financial or otherwise – is usually down to the management accountant. Have you reached a size that would justify recruiting an accountant? If not, have you considered buying in the expertise on a part-time basis?
There’s an expression with management information that says “rubbish in – rubbish out”. So, when you’ve decided what good information you want you need to establish that:
- Accurate, relevant, timely data is being collected
- You have systems that convert good data into useful information
Don’t make the mistake of thinking that computerised information systems are time savers – they seldom are. They demand disciplined and accurate collection of data and the systems architecture suitable for generating useful reporting for your business.
- Decide that you’re willing to invest time and money in producing good management information
- Decide on the information you want
- Work back to the data capture required to generate the information
- With this specification, source a computerised system capable of delivering your requirements
Finally, don’t of necessity think you need to invest £000s. We’ve seen more businesses struggle with over specified systems than we have businesses struggling with under specified systems. If you’re in the early stages of growth it may well be that all you need is a basic accounts package and Excel skills.
Our growth specialists can help your management team focus on the next steps needed for your growth. Whether that support comes through scale-up leadership, support to implement your growth plans or help to overcome barriers, our team can guide you on your growth journey. If you’d like to discuss your management information requirements please do not hesitate to contact us.