Your financial records aren’t just a set of numbers that indicate your profitability. They’re the story your business is telling you day in and day out.
Most IT and managed service providers (MSPs) we talk to aren’t getting as much out of their financial stories as they should be. They see the bottom line and maybe spot gaps in ConnectWise, but they can’t grasp what their business is trying to tell them.
You need to understand the financial language to follow the story entirely. You need to be able to look at financials in a structured way to really hear the story and to be able to listen to the story often enough as it changes to identify necessary corrective actions.
Sometimes your financial story might seem as difficult as reading War and Peace. But when you cut to the core of your financials, you’ll find the keys to increasing net profitability and bottom-line revenue while freeing up time to make critical decisions about your business.
3 Steps for Systematically Growing Your Business
Many owners are too busy managing daily operations and fail to take a step back and assess their financial and operational health. Yes, they read some numbers, but many owners report that they either don’t know what to report or don’t prioritize reviewing those numbers consistently. Spotting trends and leveraging historical data can prevent poor decisions and growth. This is our motivation for creating three specific steps (programs) that help MSPs read their financials and spot growth opportunities.
As you work to get your financial story under control, consider how each of these steps could impact your business.
1. Work with a Business “Coach” Who Knows What the Numbers Should Tell You
Everyone needs a coach; even Olympic athletes need a coach. The reality is that a coach will guide you through your numbers to help you review, track, and trend financial and operational KPIs. Alongside the organization’s performance, programs that provided guided learning provide you with a path to mastering profitability.
At Bering McKinley, we recognize an owner’s need for guided business coaching, and we fill the gap with a special program called the Compass Program. Every month, we provide a compiled report of an owner’s financial and operational data from their own QuickBooks and ConnectWise accounts. Month after month, we work with owners to see trend information around key KPIs and gain valuable insights into how the business is really performing. We use this time to review compliance results, positive and negative trends, and corrective action that must be taken to improve performance and profitability.
The Bering McKinley Compass program and programs like them are ways for MSP owners to go deeper into their numbers and understand the “why” behind them. If you’re an organizational leader that wants an industry-leading expert to review your financial story (without the $50,000 per year price tag), The Bering McKinley Compass could help you plot a growth path.
2. GPS for Quicker Results
Let’s face it, we often start on the right path and find ourselves way off course over time. Why? Because the accountability around proven best practices that would have helped us avoid those small and (at the time) seemingly insignificant decisions turn out to cost us time and money in the long run. We spin our wheels doing what others have mastered and learned how to avoid. This is where GPS comes in.
Legendary baseball catcher Yogi Berra said, “If you don’t know where you are going, you will end up someplace else,” and so it is with our business. GPS is the accountability, and the best practices learned from experts and peers that provide any owner with a better financial understanding of business growth.
At Bering McKinley, we take it one step further, and we blend monthly one-on-one financial reviews into the peer team environment to give owners the tangible tools to guide the business. Peer team environments need to cover service-related issues around time entry compliance to invoicing compliance, agreement buildout compliance, and sales module review to maximize efficiency and impact profitability.
3. Business Destination Planning Now & Not Later
We all went into business for different reasons. Maybe you fell into ownership intentionally or by accident. Some individuals set out to become owners from the very beginning, but you have to know where you are taking the company, whatever the reason you chose to own your own business.
We believe you will not reach your desired business destination by chance. Figuring out what you want from the business, whether it be a succession to a family member or selling the company down the road, requires planning and preparation now to reach your desired destination.
Steps for Business Planning:
Starting with a business assessment. Create a roadmap for reaching your business and financial goals
- Decide what kind of business owner you want to be. Is the business more a lifestyle journey, or do you want to be highly profitable to get a specific buy-out price? Decide now. Your business ownership “style” will determine what the business is worth down the road.
- Work with a business coach who will analyze every step in every transaction for efficiency and effectiveness. At Bering McKinley, we weave our recommendations into your existing processes, and managers are given specific instructions to achieve desired outcomes. Be sure to choose your coach wisely.
Business Performance Assessment: The First Page of Your Financial Story
As business consultants, this is where we begin. Our Business Performance Assessment is the first step mirroring what you might experience at a doctor’s visit. You might visit your doctor to address a single, superficial symptom, only to discover the real issue or root cause of the problem.
This is why we firmly believe a business performance assessment that leads to business improvement is the only way to provide meaningful answers to the MSPs.
The Business Performance Assessment (BPA) is a one of a kind experience that takes you on a journey through your organization’s service, sales, financial and internal processes to reveal gaps and areas for improvement. The Business Performance Assessment helps MSP leaders:
- Understand how the business is doing today
- Identify clearly what the owners/leaders want to achieve.
- Reveal where the challenges exist to treat root-cause issues that lead to long-term solutions
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