3. Outline
⢠Finder vs Minder
⢠How to know when to Budget
⢠Why Budget?
⢠Who Budgets in the group?
⢠Observations?
⢠What do you need to budget?
⢠What are the benefits and costs?
4. Unofficial Organization Chart
⢠Finders â owners, future
thinkers, relationship builders,
risk takers
⢠Minders â historical view,
lives in past, desires order,
resists change
⢠Grinders â live for today,
non-dreamer, non-delegator,
the doer
5. 4 Stages of Cash
Stage 1: Infrastructure Creation
Ownerâs Activities
⢠Building relationships with customers
⢠Creating relationships with vendors
⢠Delegating tasks to employees or associates
⢠Causing sales and cash to come into the company
6. Stage 2: Infrastructure Peak
The result of Infrastructure Creation is Infrastructure Peak
⢠Few customer complaints
⢠High customer service
⢠Low overhead
⢠Company runs âlean and meanâ
⢠Short cash collection cycles
⢠Personal sacrifice by the Finder
7. Stage 3: Outgrowth
Result of running lean is burn-out of owner and employees
Attitudes change, owner thinks:
⢠âI should have a raiseâ
⢠âWe need more people so we can take time offâ
⢠âWe need a better buildingâ
⢠âI need a new car/house/vacationâŚâŚâ
⢠âWe should buy more equipment or inventoryâ
8. Needs Change During
Outgrowth Phase
Heightened Need For Infrastructure
⢠Cash Flow Forecasting, Budgets, Goals
⢠Expense Control
⢠Policies and Procedures
⢠Employee Training
⢠Management Expertise
⢠Planning â to Avoid âThe Danger Zoneâ
9. During Outgrowth
Needs of a Finder Change
FOCUS ON THE PAST FOCUS ON THE FUTURE
⢠Historical reports should ⢠New Tools are Needed to
be used to identify Ensure Financial Stability
⢠Trends & Growth
⢠Baseline (KPIâs) â˘Budgets
⢠Areas for â˘Cash Flow visibility
improvement â˘Strategic Planning
â˘Experienced Managers
â˘Flash Report
The Finder is a visionary who knows that yesterday
cannot be changed, focus is on the future while applying
the knowledge gained in the past
10. Business Styles
PRO-ACTIVE RE-ACTIVE
you drive the business the business drives you
⢠Weekly Flash ⢠Poor Visibility
⢠Cash Flow Visibility ⢠Putting Out Fires
⢠Process Improvement ⢠Lack of infrastructure
⢠Creating opportunities ⢠Long hours
⢠Setting goals ⢠Lack of clear goals
Whatâs Your Pulse?
11. Re-Active Organizations
â˘Lack of appropriate infrastructure
â˘Cash problems
â˘Fire fighting mentality
â˘Long Hours
â˘Customer Service problems
â˘Lack of goals
â˘Frustration sets in
Due to these issues and staff limitations
âŚthe Finder shifts towards being a Minder,
Working IN the business rather than ON the business
12. The Result ?
The Danger Zone
The Danger Zone is created when the cash
needs of your company far exceed the cash
available to meet those needs
13. Danger Zone
Potential Outcome
⢠Loss of current and future customers & vendors
⢠Damaged business relationships
⢠Lost enthusiasm or energy of the Finder
⢠Damaged relationships with family members
⢠Death of the dream of the founder
⢠Death of the company
14. Avoiding the Danger Zone
⢠Leave Minding activities
to other capable persons
⢠Weekly Status reporting
(keep your finger on the pulse)
⢠Timely and Accurate
financials
⢠Sales or cash? â let
others find the cash,
Finders need to generate
sales with good margins
& set goals
15. Rescuing the Finder
from The Danger Zone
⢠Stop trying to solve all the problems
⢠Rely on others for Minding
â Find someone who is good at it
â Bring in someone the Finder can trust
⢠Return the focus to finding new customers
⢠Refocus on product and market factors
⢠Create a reporting system that measures the Pulse
of the business
â Meaningful financial and performance reports
â not Quickbooks/Peachtree standard formats
16. Reports for Finders
Forward looking
Sales by Month
Dashboard
300000
250000
200000
Plan
Sales
150000
Actual
100000
50000
0
1 2 3 4
Period
Analytics
Sales per Employee
Plan per EE Actual per EE
6,000
5,000
4,000
3,000
2,000
1 2 3 4
Period
18. Cash Flow Forecast
Why Companies Fail
Cash Out exceeds Cash In
Finder is drawn into Minder duties
The plan was to grow but lack of
planning results in:
Poor Management
Overspending
Surprises Firefighting
slow vendor payments
& time spent seeking new vendors
poor morale turnover
poor collections
poor customer service
loss of customers
FORECASTING alerts you to possible
future problems and allows time to:
â˘investigate alternatives & take action
â˘find additional funding
â˘improve performance
â˘Survive & Grow
19. The Economy
Danger Signs
⢠Prompt payers begin to slow
⢠Orders decrease
⢠Bad Debt will increase
⢠Surprise order from new customer
(prior vendor shut them off due to non-payment)
⢠Employee Fraud increases
Planning
⢠run Lean, cut costs now
⢠surround yourself with experienced advisors
⢠know your cash balance and projected cash balance
⢠"In a true crisis you are managing cash, not managing the
numbers⌠In a turnaround situation, there is no cost that
is fixed." - Bettina Whyte, Advisory Board Chairman,
Bridge Associates
20. Survival & Growth
⢠Surround Yourself With Talent and Information
⢠CEO & Business Roundtables
⢠Flash Reports
⢠Budget vs. Actual reporting
⢠Seasoned professionals you can trust
⢠Forward looking (realistic) projections
⢠Identify & Take Action
⢠Company Strengths and Weaknesses
SWOT Analysis
⢠Employee Strengths and Weaknesses
let competitors hire your weak employees
⢠Customer Strengths and Weaknesses
will they weather the storm
⢠Vendor Strengths and Weaknesses
establish 2nd sources
⢠Be a Finder
⢠Build an infrastructure that allows you to be a Finder
⢠Find the right Minders
⢠Visit customers, maintain excellent relations
⢠Impart your vision to the staff
⢠celebrate successes
and keep your finger on the PULSE
21. Chris James
Partner
63972.955.5743
cjames@b2bcfo.com
www.b2bcfo.com