Sticky solutions to your everyday business challenges
Question: I’m celebrating my 6-year anniversary this month at a 160-person commercial real estate firm in Indianapolis. I have a Bachelors degree and have gone through the company’s management training program which helps me with my team management needs. For the rest of the year, I’d like to focus on building a new skill outside of the traditional management training program. Do you have a recommendation on one area that I could focus on?
The traditional role of a manager is one that ensures that the people, processes, and technologies of the organization are working together to achieve its strategic goals. To give yourself and your team a boost outside of the traditional areas of focus, we recommend that you take the time to build your financial acumen.
There’s a good chance that your firm reports its financials around a December 31st calendar year, which means budgeting season is just around the corner. Use this season as an opportunity to expand your knowledge of how your firm moves from budgeting to forecasting to reporting of financials. Doing so will help you understand how the decisions you make on a daily basis impact the financial health of the firm, and will improve your contribution as a manager.
Get the C-Level Perspective
Whether or not you work in the accounting department, you can still grow your financial acumen (depending on the level of financial transparency of your firm) by unpacking the monthly financial reports with the firm’s executive team. The next time the monthly financials are released, make a round of appointments in this order:
CEO and/or President – make an appointment with the highest ranking officer in your firm. Take two copies of the financials with you, and ask her or him to walk you through what areas of focus are most important at that level of the firm. Chances are, the focus will be on what stakeholders and Board members are going to ask. Make notes on your copies of the reports from your meeting to get an understanding of how the CEO assesses the financial health of the firm.
Chief Financial Officer – repeat this process with the firm’s highest ranking financial officer. Most likely, the focus will be on the fiscal health of the firm to ensure it is in good shape today and in the future. Ask for advice on three things you can do daily that would have a positive contribution on the financials from the CFO perspective.
Chief Operating Officer – get the perspective once more from the person responsible for operations. Is the focus on employee turnover? Client churn? Find out what matters most at this level and ask advice about three things you can do daily that would positively impact the financial from the operation’s perspective.
Just because you don’t work in accounting, doesn’t mean you should ignore the firm’s financial health. Make yourself part of the financial reporting cycle and educate yourself about the stories behind the numbers.
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