Fred from WWC pointed to a very interesting and very true item in one of his post on the Ideate-blog.
We all know the statistics on failing businesses: 4 out of 5 (UK figures, SA it seems it’s even worse: 95%) fail within the first 5 years of trading. Mostly due to lack of cash, lack of understanding of ‘the books’, lack of understanding that appointing someone responsible for the number crunching is a very important part of growing (sometimes even the survival of) your business.
In his latest post Fred calls such a person a “Financial Cornerstone”.
I totally agree with this statement and think that every business (small, SME or Multi-National) should have at least one.
Even a one-man(woman)-band. In that regard that a one-man-band should dedicate at least a certain amount of time to ‘number-crunching’, or have a practical system in place to ‘ease’ the work and find a dedicated (part-time) bookkeeper as Financial Cornerstone, in the end it’s worth the ‘investment.
One of the biggest benefits of such a person, which I didn't mention, is *accountability* - such an underused concept in small business.
Posted by: Freddy Rodrigues | November 15, 2006 at 06:50 AM
Once again we are in agreement. But I 'wood' like to add: that concept is overused in large companies. It always looks like the large a company becomes, the less accountable everyone, even the 'auditors' seem to be (Enron comes to mind).
(That, again, is coming back to Good to Great, where accountability is so very much integrated in the whole concept everybody feels accountable ;-))
Posted by: Karin | November 15, 2006 at 09:02 AM