The monthly discipline.
WHAT TO REVIEW
Revenue against forecast Margin Fixed costs against budget Cash position and forecast Receivables and their age Payables Any target you set
WHEN
Shortly after the month ends, while it is actionable.
WHY PROMPTLY
Information arriving months later cannot change anything.
WHAT THAT REQUIRES
Bookkeeping kept current.
WHY THAT IS THE PRECONDITION
Without it, there is nothing to review.
WHAT TO ASK OF EVERY VARIANCE
Why, and whether it continues.
WHAT TO INVESTIGATE
Margin falling Costs rising without decision Receivables ageing Revenue below forecast repeatedly
WHAT AGEING RECEIVABLES INDICATE
Collection problems, or a customer in difficulty.
WHAT TO DO ABOUT THE OLDEST
Address them first, before they become uncollectable.
WHAT TO PRODUCE
A short summary, each month.
WHAT IT SHOULD CONTAIN
The key numbers What changed What you will do
HOW SHORT
A page.
WHO SHOULD SEE IT
Whoever makes decisions.
WHAT TO TRACK OVER TIME
Trends, rather than single months.
WHY
Individual months vary, and reacting to each produces poor decisions.
WHAT TO REVIEW ANNUALLY
Whether the business is genuinely improving.
