The numbers must work

accountant-numbers must workGreat ideas are great.  Beautiful plans are exciting. But the numbers must work to support those ideas and plans.

This is about business.  Obviously there are a few things that don’t need to be measured.  Everything else does.  Art does.  Van Gogh was a great painter but his numbers didn’t work and he died poor.  People do.  We don’t keep people who don’t measure up – at least not in the workplace.

Business must pass the test of the numbers every day and every year.  Sales quotas must be met, margins must be acceptable, costs must me controlled, and budgets need to be followed. This is an iron law of business.  It’s like gravity.  Everything must be measured by the numbers and the numbers must work.

I work with businesses, start-ups, company divisions, new projects, and expansions by some people and companies that have great ideas but the numbers don’t work.  If they don’t work, you must either make adjustments or abandon the idea.  You can’t go plunging full speed ahead on a project that is doomed to failure because it bleeds money.

Not everyone is tasked with watching the numbers.  Of course if you have your own small business it’s all you.  If you work for a larger organization you may not be directly in charge of a budget.  Even so, someone needs to make sure those numbers work at every level.  This is a leadership activity.  Leaders are concerned about making the numbers work – followers don’t think about such things. People are counting on you to make sure the numbers work.  Don’t let them down.  Do not neglect this important task.

So, here’s what to do:  Start counting.  Create systems to make the numbers work.  Measure the input, output, projections, everything.  Do your research.  Crunch all the numbers.  You have many ways to fail financially.  Find them before you start.  Be skeptical.  Find your break-even.  Become intimately aware of all the numbers that contribute to your project.

Many years ago at a former workplace, I was responsible for making sure the numbers worked.  I neglected this and put it off.  I didn’t give it my due diligence.  I failed because I ignored tell tale signs that only the numbers were trying to tell me.  I let people down and hurt myself as well.  Don’t make this mistake.  Do your homework.  Make sure the numbers work.  Bob R

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