Components of Your Business and What to Manage
Think of the different aspects of your business, it may be stock control, project management, task monitoring, managing client relationships, sales, manufacturing, or even staff management. They all have something in common. They all generate and rely on data. Now we often think of data as numbers of text in cells in a spreadsheet, but it is so much more personal and useful than that. Think of due dates, sales values, days required, time taken, margins, stock figures, budgets, targets, etc. All of this is data, and all of these are vital to most businesses. You may not use all of these components in your business, and you may use others, but you have components. Components that rely on data. Data that most either don’t use, or don’t use properly.
So, what does this have to do with spreadsheets? Well, the right spreadsheet can help with a few aspects of each of the components of your business. Here are 4 things that you should achieve with the data in each of the components of your business. Obviously, each may be more or less critical for some components as compared to others, but these are the general things to keep in mind when managing each of these areas of your business.
Lay out and enforce your process
Businesses spend load of time, money and effort getting the right process together. It can be the difference between profit and loss, or even between success or failure. You and your staff need to stick to the process that has been established. You want it to be flexible enough to accommodate the needs of your clients, but rigid enough to eliminate careless errors and ensure productivity. If you’re using a spreadsheet, it should be made according to this process. For example, if you have the data available to go into your spreadsheet, make the spreadsheet to suit the data. That way you don’t need to re-enter data. If you’re collecting data, have the columns in the order that you collect it. Working from left to right is so much easier that all over the place. Collect the data you need, and then ignore data you don’t. So often people are using out of someone else’s spreadsheet, so they only collect some data, which means that they often forget what to collect. Make it easy, follow the process. Not only does this help to define the process, but it also helps people stick to it. When people are entering data (especially from drop down lists) where it needs to be entered, it much more accurate than simply making notes on a blank page. Less is forgotten, the data is more accurate, and it provides the spreadsheet with the data needed for the rest of these points.
Tracking issues before they occur
Once you have the data collected, what do you want it to tell you? For example, if you’re starting a new project on a Monday, and you should therefore move onto stage 2 of the project 2 days later, we can tell that to the spreadsheet. So, on Wednesday morning when you open your spreadsheet, there is a prompt telling you to do the next stage of the new project. Provided there is a mathematical solution, the spreadsheet could do these kinds of checks and alerts for almost anything. For example, you need to order stock when the levels go below a certain value for each raw material. Or, you need to calculate selling prices based on cost prices, or even track when last you followed up with a potential lead. Once the raw data is in place, you can then have your spreadsheet use that data to make predictions, flag up alerts, track what is being done compared to what is scheduled to do, even look for incorrect data (in some cases). If the data collection is ‘pre-project’, then think of this as the part which is ‘during the project’. All the alerts, warnings, traffic light changes, KPI monitoring, and projections that you need. This could become a reality with the right spreadsheet.
Analysing and reporting
We’ve dealt with pre-project and during the project, this would be ‘post-project’. You’ve finished the project, completed the deal, done the sales for the period, done the appraisal, finished the year, etc. Now what? You collected all that data. Are you using it? Do you know what jobs made money and what jobs didn’t? Do you know what products made you the most profit? Do you know who did what when and how often? Do you know what stages of the projects were late or early more often? Do you know what you need to know? Usually, no. Most people stop after the first two, the job is done and they’re on to the next one. Most don’t have time for further analysis. Having said that, if the spreadsheet is already made to do this further analysis, then all the time you need it to click on a new tab and look at the report. Most of the spreadsheet I make do some form of post-project analysis, in order to tell you how things have gone. This overview can be vital, as it shows you what may need to change and what is doing well. Many are not set up for this kind of analysis, so when they get to the end of the year, they are frantically trying to work this out, so I am not surprised they just give up. This really should be set up on your spreadsheets. Not only to save time at the end of the year or project, but also so that you can see this live at any stage. That means that you can make decisions quicker than most other people. One last thing here, don’t just rely on your accountant to tell you this information, because they often only focus on certain financial report and don’t cover everything you need to know.
Driving positive changes
What is the point of knowing what has gone on, if you’re not going to change the parts that have not gone well? This is the ultimate goal of the right kind of spreadsheet. If it gives you information that helps you to make positive changes, that is brilliant. For example, if stage 3 of the projects was constantly going over time, and stage 4 was constantly finishing early, you may want to address why that is happening. If you have under-estimated one and over-estimated the other, you could change that. It sounds small, but that could affect staff hours and pay, supply chain, lead times, etc. Making simple changes can cause a ripple effect to earn huge results. Those could be good or bad, so you need to know what you are looking to learn, and the spreadsheets need to be set up to produce the right reports from the right data.
Think about your business, and the components of it. Break it down into sections and think of what is required for each. Now, I have mentioned how each component needs to be managed, but then there is also a cause for combining components and managing them together. Think of supply chain issues, it’s not just about stock, but sales, manufacturing, advertising, etc. It all needs to be balanced and analysed to get the best results. This could be the next level with your spreadsheets, extracting data from various spreadsheets and combining them in one to see the whole picture. The sky is the limit!
As always, if you’d like someone to make your spreadsheet for you, I’m here when you need me.