Thoughts on Courage


I am so inspired by the courage I see every day recently in front-line workers—the doctors, nurses, grocery store checkout clerks, police officers, etc.  I am also in awe of the bravery and courage of our military personnel.  Courage drips off these people.  I also inspired the people I serve and many of my clients who have really stepped up and demonstrated immense courage and leadership.  It seems like a crisis can bring out the best in people.

With business significantly changing and the ‘new reality’ is completely unknown, courage and trust are so needed today. Our staff needs our leadership and support—which especially now, can take incredible courage to step up and provide leadership to drive our companies forward.

Courage is a combination of knowledge, faith, and action.  We need all three—two without the other generally doesn’t work.   A project team with knowledge and faith gather the data—they know it’s going to work—but without action, it’s paralysis by analysis.  We all suffer from this.  We need to have the facts and believe what in what we’re doing, but we need action to bring the goal, project, or initiative to completion.  However, action and faith without knowledge is generally stupid and short-sighted.   And knowledge and action can work together, but if there isn’t faith in the idea or project, it won’t sell well or create enthusiasm among staff and clients/customers.  We need all three to exercise real courage.

Courage is such an important attribute in our business’s success.  Companies are already perishing at an unbelievable rate – 52% of the Fortune 500 from 2000 to today are gone. (Yes, some through acquisition, but many are outright gone.)  Somewhere the balance of knowledge, faith, and action failed.   This a is scary fact, but learning from it gives companies an opportunity to be different and thrive.

What got us here won’t get us there.  We need to continually work for tomorrow developing ourselves and our teams and mustering the ongoing courage to drive our companies forward, try new things, and learn from mistakes.

We all fear change. We’ve been brought up to keep “safe.”  And indeed, we need to practice safety on practical levels, especially now. But like a caterpillar that eventually turns into a butterfly, we cannot stay cocooned in the “safety net” of how we’ve always done things while the world drastically changes around us.

Here’s to the courage we are seeing, and the courage we are trying to muster up. Our companies, our staff, and our world need it.


The 13-Week Cash Flow Forecast


I’ve been harping on using the 13-week cash flow forecast (13WCFF) process for years.  It is one of the basic tools for the turnaround professional to quickly get a handle on the short-term cash needs.   It forces the business owner to run their business based on cash the typical income statement lens.

The typical monthly balance sheet and income statement are not enough to effectively run your business.  I’ve seen many profitable businesses run out of cash – and conversely, I’ve worked with struggling companies that have stayed alive for months allowing them to the runway needed to return to profitability.

Whatever stage your business is in, I highly recommend implementing a 13wcff process now to help in these extremely uncertain times.

The concept is the 13WCF forecasts cash receipts and cash disbursements by week for a 3-month period.   In a turnaround, the 13WCF is updated constantly, but for a typical business, I like to update it weekly so it’s always a rolling 3-month look forward.

With all the current uncertainty it’s more important than ever to use the 13wcf process to better predict your cash position, see any bumps in the road, and help you sleep better at night.

The 13wcf forces businesses to think in terms of cash vs typical GAAP accounting.

I created this short demonstration video on how to use the 13-Week Cash Flow template in my resource section.  It takes some work to get started and discipline stay with it update it weekly, but I guarantee this process with help your business.

I hope this helps.

As always, if you need help, reach out to me.

Our Changing World – Strange Days Indeed


The world has changed.  Your world and the economy as you know it has totally changed – and not for the better in the short-term.  We must face facts. The next two quarters will be brutal.  But this is the time to stay focused because we will all get through this.  When you’re in hell, you keep going.

But sometimes, in a crisis, we decide to be honest about our situation (even if it’s not fun), consider the worst-case scenarios (which may not become the case for our business), determine the actual facts of the situation in relation to our unique business (without panic), consider all resources (we may have more than we realize), cut out spending (which isn’t a bad idea even in healthy times) and take appropriate action (that’s what you are in leadership for.)

For many, part of this process will be to take advantage of the Federal Coronavirus Relief Bill.  Work with your CPA, lawyer, and banker now!  See some summary pieces and the simple applications here.

Thoughts On Remote Work

All my clients are now working remotely.  Some companies were progressive and pushed for being ready; others were in denial until the state governors issued stay at home orders.

I’ve been working remotely for the last 15 years as a trusted business advisor and virtual CFO to businesses around the country.  Now everyone is working remotely (or WFH – work from home).  I am lucky to have a great office space above my detached garage.  It’s interesting, with such an increase in video calls, to see how else is using their remote/home space.  Interacting with and leading remote teams is much different for some, where it’s business as usual for those who have been working virtually for years.

Many of my clients are using (and loving) Microsoft Team. I like it too (though I prefer NOZBE Teams.)  Many other tools are now becoming well-known such as Zoom, Asana, Basecamp, and more.

The tool you pick is important, but what’s more important is how you use it.  Try to mirror some of the same standards, schedules, and communication guidelines that would be in place in the on-location office. These virtual tools help you be able to carry on in a similar way … yet do understand that your team is going through a major change that is likely affecting (sometimes deeply) their personal lives, level of distraction, and emotions. Show some grace for a while, while keeping some standards and routines that will provide structure and even, respite, from the onslaught of information and fear.

Let me know if I can be of help to your team during this scary but also potentially beneficial (in some ways) time.  Contact me here.

The Art of the Close


Controllers and CFOs know that having a quick and accurate financial close is essential to manage your company effectively. Accurate and timely financial statements allow leadership teams to get a view of the organization’s financial picture and allows managers to make changes to improve performance.

We all can become relaxed in our company processes, but the financial close must be attacked with discipline and rigor. It’s early in the year so now is a great time to evaluate your close and improve your close process now so you have the best information as early as possible to make the best decisions. Test your close process this month-end.

I use a closing checklist with all of my clients. See an example here. The checklist lists the closing tasks, who is responsible and the expected completion time-frame. It is a simple process and keeps everyone on the same timeline. Using a closing checklist will improve your accuracy, completeness, and efficiency. You will have better information, sooner.

Once the general ledger is closed and the checklist is complete, a basic (or sometimes not so basic) reporting package can be produced, distributed, discussed, and reviewed.

I know many business owners who don’t look at their monthly financial statements very closely or they don’t fully understand what they are looking at. Some business owners don’t even look at their financial results at all. I believe it’s important to look at your monthly report-card (earlier vs. later) and to fully understand what they are telling you or trending toward. This holds teams accountable, which improves performance and allows you to make changes and improvements earlier to avoid any bumps and improve financial performance.

The other day I met with a very experienced and talented business owner who was surprised by his company’s recent situation – his company was profitable most months, but he was having trouble making his payroll. He didn’t understand the balance sheet very well. His accounts receivable and inventory were using all his cash. After a quick review of his financials and a brief lesson on asset velocity, the balance sheet, and cash flow, he saw his problem. He is developing ideas and solutions to improve this and breathe easier.

Are you experiencing similar challenges? I can help. Contact me!

Stop Wearing So Many Hats: Who Can Help You?


I see it all the time as I travel the country talking to business owners. They try to do everything. Sales, HR, Operations, Marketing, Accounting, and oh yeah … leadership.

It’s time to delegate responsibilities and focus on what you’re good at – delegate, double-check and disappear (or go do what you’re good at.)

Generally, business owners develop their skills and expertise through sales, operations, tech, or the finance side of business. Most of the business owners I talk to cut their teeth on sales which makes sense based on their “take action” personality types. This works great – in business, sales start everything.

However, what most business owners are weakest at is their accounting and finance skills.

They understand the P&L. Simple – sales minus cost minus expense equals net income. However, they generally don’t want to understand the balance sheet or cash flow.

I find the biggest need for these businesses I’ve been talking to recently is 1) a complete understanding of their financial statements (the business report card) and 2) clean, basic reporting for visibility and accountability. This includes tracking key business drivers for profit, asset velocity, business efficiency, corporate effectiveness, and cash flow.

I find the biggest need for these businesses I’ve been talking to recently is a complete understanding of the financial statements (your report card) and clean basic reporting for visibility and accountability tracking key business drivers for profit, asset velocity, business efficiency, corporate effectiveness, and cash flow.

Many of these owners don’t trust their numbers and therefore they run things by the seat of their pants. With data analytics tools now, it’s easy to get real-time data to look at customer psychometrics and data, as long as the information is current. That often takes delegation to someone (for lack of a better term) more excited about keeping up with it. You don’t have to be the accountant to understand the basics that will help you make the best decisions you can for your business. Who can you utilize on your team that will help you have the data you need?

So delegate it, double-check by getting regular updates, and spend the bulk of your time doing what YOU do best!

If your business doesn’t have this system in place, let’s talk.

Four Reasons to Document Your Processes


I love to help a business improve its processes. I know it may not sound too exciting, but it’s fun and really helps build a cohesive team.

I’ve been helping one of my clients speed-up and improve the monthly close process, implement a 13-week cash flow process to help predict cash flow, prepare the 2HYBP, and document their core business and operating processes.

Many small companies never do this, but it really makes a difference in your company’s performance.

Core processes generally revolve around

  • How you generate leads/create clients (Sales/Marketing)
  • How you serve your clients (Operations)
  • How you support your operations (Human Resources)
  • How you measure and report on what gets done (Accounting)

Once you understand this, take it a step further and document your unique processes. Here’s why:

Four Reasons to Document Your Processes

  • To improve the process (by definition)
  • To help with training
  • To expand company-wide knowledge
  • To provide consistency for all stakeholders: employees, customers, and vendors

I use a simple formula:

  1. Identify the core processes
  2. Determine who is accountable for the process
  3. Get the primary process users together (core processes must be followed by everyone involved)
  4. Understand exactly what each process is trying to do, identify outputs and measurements
  5. Flow chart the current state visually, indicating how things work TODAY; if this, then x; if that, then y
  6. Try to simplify and determined improvement changes
  7. Produce a standard document with the process name, scope, expected outcome, parties involved, expected outputs, measurements, and any deviations
  8. Separately document improvement opportunities
  9. Review and test

Documenting and simplifying core processes allow businesses to create a self-sustaining organization that will run smoothly and provide a great customer experience.

An Example

With this client, we documented the sales process first. Most business starts with sales, so this made sense. We discussed sales attitude, the greeting, the value of using a headset so the sales reps’ hands are free, and noted any sales objections. We streamlined a related customer service process:  what happens with returns, credits, complaints, etc.  The end result created a consistent, streamlined and efficient process for the company and a consistent and efficient process for the customer.  A bonus? An excellent training guide for new sales reps.

A well documented and tested process can dramatically help with a customer’s overall experience, and also keep activities consistent and efficient for employees. This was life-changing for this sales team. While being flexible, it provided a consistent and efficient repeatable process.

Once you have all the main processes documented, you have an operations manual.  (To keep it current, you should have a process to review each process yearly!)

What process will you document today?


Featured image by Gerd Altmann from Pixabay

The Second Half – continued

CA-cash projection

In my last post, I discussed the 2nd Half Year Business Plan (2HYBP) as an opportunity to reassess and re-plan the second half of your company’s performance for the year.  Hopefully, you were able to get your June financials closed tightly, analyzed the business trends and re-forecasted next two quarters.

I have all my June reporting packages completed, but I’ve had some challenges getting all the 2HYBP’s done – one of my clients is having trouble nailing down the sales plans.  And since the sales plan is the basis for the overall financial plan, we’re a little behind.

Maybe it’s paralysis analysis, but we are just finishing a deep dive into the sale forecast, slicing sales by product, by segment, by customer, by region, and by sales rep.  The sales forecast now is a driver and a scorecard.  The team is engaged and totally committed.  Sometimes it pays to be patient.  The rest of the 2HYBP is being developed around the sales plan.  The organizational chart got slightly reconfigured, and we added some additional expense provisions for a segment’s revenue growth and production efficiency.

We also developed goals around the cash flow drivers—primarily days sales outstanding (DSO) and inventory turnover.  This is a large global company and the impacts on small improvements are massive.  Plus, they have much too much inventory (calculated at 272 days).  We have developed plans to smooth imports and improve purchasing operations and feel we can easily drop on-hand inventory by 90 days.  Based on their sales volume, this improvement will add $17 million to cash!

The cash flow driver principle works the same way for smaller companies too.  Consider a $2,000,000 company with $250,000 in accounts receivable.  Bringing DSO to 35 days adds $58,000 of cash to the balance sheet.  Small improvements in accounts receivable and inventory turns are important to continually work to improve cash flow.

The 2HYBP goals should focus on 5 things from the financial side: sales, gross margin, employee efficiency, expenses, and cash flow.  How are yours doing?



The Half Time Show


June is over.  I know, it’s hard to believe… the year is half over.  As we all say – time flies.

In our business year, it’s half-time.  The first half is done and the second half is about to start.  Now is the time to solidify the second half-year business plan or the 2HYBP.

Your initial business plan was likely published in November or December with data and assumptions that are now ancient.  Fact: We now have better data, a solid history for the year, and a good read about orders and sales for the second half of the year.

It’s time now to re-assess and look at your second quarter goals; take stock where you are and readjust your sales, margin, expense, and net income targets – either up or down – more realistic.   Start planning the quarterly financial close so you can get your data finalized quickly.  Many general ledger accounts can be analyzed and finalized early.  Get started on the close early.

As a business leader, it’s now time now to begin to 2HYBP planning cycle – start getting your historical info, meet with your team, and prepare to update your operating plan for the second half of the year.

I am working with a client now with 2 business segments – a wholesale model and a direct to consumer business.  The initial targets we set for each business made sense in December, but now with actual results, we are making some significant changes with the direct to consumer business.  We didn’t hit the targets we thought we would – partially our fault and partially the reality of the market.  Nevertheless, we are redoing the 2HYBP so we finish the year strong.  You need to do the same.

This time of the year, I hunker down and go into semi-monk mode.  I work remotely for the entire month of July.  I focus on getting solid June closes with useful reporting packages with all of my clients by mid-July.  We re-cast the 2HYBP to ensure we are on pace to hit or exceed our initial goals.  We do our planning meetings early in August and get everyone on the same page, rowing in the same direction to hit our targets.

Quarterly, I recommend getting out of the office with your team to ensure everyone is in sync.  People take vacations in the summer, so get the meeting on everyone’s calendar now and take time to evaluate your half-time – then get after it and finish strong!


How Your Business Can Get $350,000 More Cash in the Bank


One of the things I do for clients is to help them evaluate cash flow and some basic profitability and efficiency data points. This identifies areas in which I can provide more help.

Generally, to get clarity, I spread out months of financial statements. Recently, I did this for a client, using 24 months of statements. I then apply a basic template to get to the level of detail we needed. By doing this early in the relationship/project, it helped me understand their business industry and peculiarities.

This company had $18M in revenue. We discussed the income statement efficient and asset turnover on the balance sheet. The “days sales outstanding” calculation indicated that the accounts receivable turnover was averaging 48 days.

I applied a calculation I typically use:

Last three months of sales divided by 90 / total accounts receivable to calculate the average number of days from when sales turn into cash. (You can invert the calculation to determine what your accounts receivable would be with a certain number of days.)

How does this help?

In this case, we looked at the possible results if the company could reduce the turnaround average by eight days.

An extra $350,000 of cash in the bank.

Obviously, this is an appealing outcome, so we brainstormed ways to improve accounts receivable turnover.  Here’s what we came up with:

  • Doing a better job upfront to ensure customers understand your credit policies
  • Proactively calling customers before the invoice is due to ensure there are no problems with their order (making it easier for them to pay on time.)
  • Build a better relationship with the customer’s accounts payable department.  People will prioritize payments to people they have a positive relationship with
  • Provide clearer and more timely invoices
  • Offer easier payment options

Maybe you don’t think about how everyday processes affect your cash flow – but they do. Take the time to review and think over regular tasks and workflows like this. You may be surprised where you can improve a process – and the bottom line.

Image by David Schwarzenberg from Pixabay









The Importance of Checklists and Forms

checklist graphic

We all need checklists in our life. It sucks, but for most of us it’s the only way to stay consistent. Yet I know very few people who use them.

I wouldn’t be able to keep up with all the details I have to manage without checklists. I have a morning routine checklist a work start-up and shutdown checklist, a Monday checklist for each client, one for daily workouts, etc.

I might need a checklist for my checklists!

You might laugh, but checklists do two valuable things for me:

  1. Do what I have planned for the week
  2. Push me to stay consistent.

We can randomly travel through life without a plan, but that tends to lead to speculation of “Where did the time go?” or “I thought I’d be in a different place in life/health/etc. at this point.”

Being intentional is critical in every area of life. Your house wasn’t built without a plan. Your car was checked numerous times in production. Hopefully, your medical practitioners have a checklist for procedures – even ones they do daily.

One of my clients is a start-up company and I am helping them develop processes and procedures. We are putting together checklists to make sure we don’t miss anything. It’s really a brilliant thing to do early on in a business. Now we have repeatable steps for training, and the ability to brainstorm and maximize the 80/20 rule for maximum efficiency. Taking the thinking out of basic, recurring tasks reduces mental fatigue. By documenting workflow, it helps any employee who takes on that responsibility to develop consistency. It helps if they go on vacation — their sub can keep the ball rolling. And the work is done in a recognizable way.  As we build these procedures, we are creating screen-cast recordings as a training and reference tool.

How about you? Do you have your everyday/every week/ every month processes written down into checklists? Don’t let the idea of it being too elementary keep you from doing it. It’s actually the opposite–it elevates your business in a way that will make it stand out from those who just “go with the flow.”



I recommend the books The E-myth Revisited and The Checklist Manifesto. 

My resource page.

Suggested checklists:

  • A basic meeting checklist for most meetings
  • Month-end financial statement closing checklist
  • New project/idea checklist
  • New hire and onboarding checklist
  • Sales meeting checklist
  • Annual strategy planning checklist
  • New Habit checklist – (I love the app Habit List – although I didn’t make it a habit to use it :)