The Everest Principle: 5 steps towards making bold business decisions

At FD Works, we love working with ambitious businesses who share our entrepreneurial outlook on business advice. That desire to look for new opportunities, new solutions and new ideas is what gets your business primed and ready for the next stage in the climb.

So, if you’re already at ‘basecamp’ and readying your team to reach the top of your own particular Everest, what are the key steps you’ll need to take?

And how does working with a trusted business advisor give you the skills, knowledge and stamina required to get you over the obstacles and standing atop the peak?

1. The reason to start your climb

Revisit key goals and drivers in your business model

When you started out, you needed big ideas, a healthy work ethic and a drive to build a stable business model. And you no doubt defined some key goals that acted as the drivers in your early-stage business model over the first year or so of trading.

Those key goals got you to ‘basecamp’, where there’s a healthy customer base, regular sales and enough money in the kitty to consider scaling up the business further. But will these goals still be fit for purpose at the next stage of the climb to the top?

Start by reviewing your business goals:

• Dig our your original business plan – revisit your initial plan and take a clear objective look at this foundational strategy. Where did you achieve success and where did you miss the target, based on this initial starting point for the business?
• Review your key goals – look over the key goals you set and see where there’s room for improvement. Consider how challenging these goals must be if you’re to reach the top. Are they pushing you and team to do more?
• Update your goals and strategy – rework your key goals and strategic business plan to reflect the company’s changing circumstances, established business position and your renewed aspirations for the next stage of the journey.
• Create a manifesto for your business – bring all your renewed goals, values and aspirations for the company together in one short, snappy document: a manifesto for the future of the business. Valuable Content explain how to do this here.

2. Use the right tools and equipment

The processes and resources needed to support growth

As the company grows, the complexity of your finances, invoicing, operations and administration will expand at a similar rate. To ensure you remain efficient there’s a need to stay in control of these business areas – and that means having the right tools for the job.

The emergence of cloud technology and online business apps mean there’s a wide market to choose your tools and systems from. But you also need to get your fundamental underlying business processes and team resourcing right if you’re to get the most from these systems.

So do you have the right tools in your business backpack?

Begin by reviewing your existing financial systems and processes:

• Carry out a process audit – run a company-wide review of each procedure, task and action in the business. Think about the inputs, processes and outputs that make up your business model, and get the whole system documented and organised.
• Systemise your processes – take the output from your process audit and look for ways to streamline, enhance and systemise each element – and, where possible, to automate tasks using software to free up business time for your team.
• Customise your software systems – with your processes systemised, create a custom business set-up using software apps and tools to get the hard work done – e.g. moving your finances to Xero online accounting, or using GoCardless to get paid on time.
• Outline your roles and responsibilities – software can automate much of the low-level admin, but you still need an effective team at the core of the company. Define the key roles needed to deliver your revised strategy, and build a team that’s ready for the climb.

3. Plot the best route to success

Build forecasts of revenue, profit and cash

‘Fail to plan, plan to fail’ is a well-worn adage in business circles, but it’s a phrase that every basecamp-ready business leader should heed. Never underestimate the importance of planning and forecasting in defining your route to the heights of business success.

Without doing the preparation, thinking through your route and looking at the potential challenges, your business is setting off into a blizzard full of unknown pitfalls.

So before you take even the smallest step in the next stage of the climb, it’s crucial to sit down and start looking through your key numbers and metrics.

Let’s look at some of the key considerations to include:

• Use Xero to track your key numbers – by customising your codes in Xero, you can quickly set up your accounting and reporting to track the important business numbers and keep tabs on your ongoing revenues, profitability and cash-flow situation over time.
• Aim for a positive cash-flow position – cash flow is the lifeblood of the business, so it’s important to focus on driving revenues, getting paid on time and looking to reduce the impact of late payments and aged debts on your cash forecasts.
• Run forecasts to predict future performance – your online accounts provide a pool of incredibly insightful business data that can be used to forecast your future performance. Project your numbers forward 6 months, 12 months or two years into the future to provide forecasts of revenue, profit and cash flow – and scenario-plan different options.
• Build your growth plan – you can now create a plan for growth that includes a clear budget, solid financial predictions and renewed goals for the company. This is your route to the top and, with your homework done, gives you a confident route to success.

4. Revisit your route along the way

Focus on KPIs and performance management

Once you’ve set out to conquer your own particular business Everest, it’s important to have access to the right key performance indicators (KPIs). Tracking performance throughout the journey provides constant analysis of your route and allows for corrections along the way.

A good business plan isn’t a static document, so the more granular your reporting is, the better you can judge the quality of your current direction, and where there may be a need to pivot.

• Define your KPIs – it’s vital to define the specific performance numbers that will impact on your ascent.  Whether it’s your gross profit %, your customer satisfaction level or your new sales figure, be clear about which elements are vital to your business goals,
• Customise your dashboard and management packs – once those KPIs are agreed on, get them coded, tracked and into your dashboard. The clearer your view of the current performance of the business, the easier it will be to revise your route map.
• Take direct action where needed – if your KPI dashboard is flashing a red warning sign, don’t ignore this. Consider your options, work with your advisors and take fast, bold and direct action to overcome any challenges that might scupper your chances of success.

5. The value of a sherpa to guide the way

A virtual FD who shares your entrepreneurial mindset

Experience is a hugely valuable commodity to have in your kitbag. Whether you’re a first-time business owner or a serial entrepreneur, there’s a real benefit to having a financial and strategic expert on your team – this is where your finance ‘sherpa’ will help you scale new heights.

With a virtual FD on your board, you get the quality financial advice needed to drive the business to the next stage of development, with the additional benefits of:

• Drilled-down expertise from a finance professional who understands your entrepreneurial mindset and the business challenges you may be facing.
• Hands-on strategic support to evolve your business model, improve the efficiency of your finances and enhance your internal drivers.
• Flexible access to a whole finance team who can take on your financial management, freeing up your own staff for customer-facing and business development tasks.

It’s this combination of accounting knowledge, commercial experience and financial resources that helps you scale your business mountain with minimal risk. With a sure-footed sherpa guiding you at every stage, you know you’re in safe hands.

Helping with bold business decisions

At FD Works, we see ourselves as a combination of basecamp trainer and experienced sherpa, with the resources of a highly enthusiastic mountaineering support crew.

We’ll help your established company to review its current business model, refine its strategy and define the key goals, targets and challenges that will form your strategic plan for the short, mid and long-term futures of the company.

When there are bold decisions to make, we’ll give you the facts, the insight and the unswerving support you need to push forward – we’ll get to the top of your business Everest together, and with oxygen to spare: that’s our promise to you.

Who are FD Works?

Located between Bristol and Bath, FD Works are an ambitious accountancy firm working with startups, scaleups and established firms across a variety of sectors. We help business owners take control of their numbers and realise the true potential of their venture.