All businesses (big and small) can be divided into 11 areas of internal management. They break down across the following departments: facilities, financial, people management (HR), marketing, social impact, relationship management, sales, service delivery, strategy, tech & communications, and risk management.
These areas of internal management, or AIMs, became apparent to me during my time as a business manager with RNW Consulting many years back. They were the core elements that needed to be managed by the Fortune 500 companies I worked with. But for the solopreneurs and small businesses I work with today, they are just as important to address.
That’s right. Having a plan in place for something like facilities is just as important to a corporation with multiple locations as it is the small business owner working from their home office. Why? Because you can’t control the growth of your business by winging it.
For those already in a constant state of feeling overwhelmed and overworked, hearing that you should be juggling and managing 11 departments sounds crazy. It might feel like a lot, but you are probably already doing it without knowing it. All we need to do is address these areas consciously and strategically.
Match Against Your Chart of Accounts
You’ll find it extremely beneficial to match your areas of internal management to your chart of accounts (COA). This listing reflects every financial account of a business, noting the corresponding account types and balances for each.
You may choose to structure accounts for expenses by department. Doing so gives you an organized reference point for financial health across every area of your business.
Review Your P&L Reports
A profit and loss report (P&L) is a snapshot of just that. You’re looking at the amount of money your business brings in compared to the amount of money it spends.
Structure your reports so that you can see the expenses and income according to each area of internal management. With consistent reporting in place, your numbers will begin to tell a story — one that allows you to align trends and metrics with overall strategy and goals.
Review From Both a Quantitative and Qualitative POV
As you review and compare across different financial reports, it helps to do so from both a quantitative and qualitative point-of-view. You’re not simply looking at the numbers alone — whether they increase, decrease, or stay the same.
You’re looking at the story the numbers tell. What do the trends reflect regarding your business’ spending habits month-to-month? What impact will they have on your business as time goes on?
These qualitative reflections paired with quantitative data provides you with both the insight needed to develop realistic goals and the means to achieve them.
If you’re still struggling to align all facets of your business under one financial umbrella, we can help. Learn how Officeheads’ Business and Financial Success Coaching can help AIM your business in the direction you want it to go!