If you manage a company you are going to be interested in how the financial side works. Financial planning will be important and not an area of business that you would leave to chance. It is also something that you should continue watching as if you want to make the right decisions you have you have the right information. In the same way that you would be sensible with you own money, you need to have the same level of care with the money in the company.
When it is a company involved, there are a variety of areas where sound planning must be in place. If it fails there are a lot of people who will suffer. It will not just be the owners who lose out, but all of the employees as well as the people who make a living out of what they spend.
Set Out a Financial Plan
- Look ahead – what do you want the business to achieve in the next year, 5 years and 20 years. Realistically the 20 year one may not be comprehensive, but there should be some plans in place.
- Take stock of everything that is owned or owed. Without knowing exactly where you are can lead to confusion further down the line.
- Be honest about where you are now. Are you happy with the current situation or do you still want to make changes?
- Set out how you are going to reach your finishing post. This can be done in small or large chunks – although a back-up plan will also have to be considered.
- Start the plan as soon as possible. If you do not over commit, it will be possible to tweak a little when the full position is known.
- Take a good, had look at it at least once a year. Unless something major happens, it is probably pointless doing it more often than that. If there are concerns, don’t be afraid to make changes
Once the plan is in place, there will be a lot of good knock on effects. Firstly, there will be a feeling of confidence that can spread throughout the firm. Knowing where you stand can be liberating.
The fear of financial planning can be a lot worse than the reality. What is needed is software that will work with you rather than against you. If you are happy to trundle along, just making a living and paying the bills it may not be such a big deal, but if you want success, it certainly is.
What you need is software to make the job easy. You will want to know the best and worst-case scenario. You will have to know the language of money and numbers, and the software you choose needs to help you with this. Thanks to Anaplan you don’t have to be an expert. Once using the software, you will be able to put in place some compact plans and run the model you want throughout the business.
While it is important to know where you have come from, you also need to know where you are going. You should be more concerned about what will happen rather than what has happened. You may be able to learn from the past but you cannot influence it.
Your software of choice should allow you to see everything in the one place and let you input once and share rather than input the same data again and again. Forecast wisely, and with good financial planning you will cut your workload and your stress.