Driving with your eyes closed
I have been asked to write an article for the inaugural issue of a new online magazine aimed at the Small Business Owner. Just in case it doesn't make the editorial cut, here it is.
Have you ever tried getting in your car, starting the engine, selecting first gear, closing your eyes and then pressing the accelerator? No? Too dangerous? Of course it is.
At the very best you will end up at the wrong destination and will definitely have an accident along the way, probably after covering only a short distance.
At worst you will write the car off, and probably yourself as well.
So why do many small business owners do that with their business?
They start off, try and go as fast as they can without looking, don’t know where other businesses are, how much fuel they have left, and have no idea what road they are on.
They probably didn’t have a destination in mind anyway!
Their poor passengers, employees and suppliers, are having their lives put at risk because the driver thinks he knows what he is doing, doesn't ask for help and doesn't listen.
So what’s the answer?
You need to decide your ultimate destination, but in terms of knowing where you are, you need a decent accounts system. Boring that may sound, but essential.
One where you can watch the dials in real time, not guess where you are when you do your VAT return, or six months after your year end when your accounts are prepared. What use is that?
Oh, and you also need a map to follow, it’s called a budget.
We're human, so I know from my own experience, that unless a system is easy, intuitive, has features that help not hinder and, above all else, one I can use wherever I am, on any platform I choose, I won't use it.
We demand those features in other areas of our life, checking emails, watching films, listening to music, shopping, keeping up to date with family and friends, so why not when doing our accounts?
Those requirements mean you need a Cloud based accounts system.
One you can use on a PC, Mac, Smartphone or Tablet, when and wherever you want.
Your employees can also login and help you drive, seeing only the data you want them to.
This way you are more likely to use it, keep it up to date, and get real time, useful information as to where your business is, where it’s been and where it’s headed.
Just checking your bank balance, in isolation, doesn’t cut it in these economically difficult times.
It's like those drivers that pass us on the motorway at 80 mph in heavy fog or rain. Somewhere down the line they will have a big accident and be out of business – blaming it on someone else!
Talking of bank balances, the best online systems receive feeds direct from your bank, saving you time and reducing errors and omissions.
Of course, such systems may not be right for all businesses but 20% of our clients, of all sizes, have already moved into the cloud and will never go back. That percentage is growing every week.
They don’t need to worry about backups and they see problems looming in time to react.
So how do you choose between the systems available?
Well, all the providers’ websites look good and tell a great story so you need to get under the bonnet, check the size of the engine, look at its service records, read some reviews and take it for a free test drive, just as you do when choosing your next car.
Get your accountant to obtain a copy of the last accounts filed by the online providers, I have done that and have found some scary results. Designing and developing an online accounts system is serious business and needs serious funding. You wouldn’t buy a car put together by an amateur in his shed, however good it looked.
And there are a few ‘sheds’ out there!
Look around for reviews on the 'net, see how many accountants a provider has partnered with; accountants aren’t going to dare recommend a provider that may go bust, as that wouldn’t be great for their own client relationship.
Make a list of the features you need, and then check those against the options offered.
Often a missing feature can be got by signing up to an additional system that plugs into the accounts system - the Cloud makes that easy. Good online accounts systems will have a list of add-ons that others have developed to plug in.
Ask your accountant to help you choose the right one and make sure he or she can access it, help you set it up and keep it up to date, answering any questions you have along the way.
Again, human nature dictates that, if you get stuck and can't get an instant answer, you will stop using it.
Once it's all up and running and you have learned how to drive it, get it serviced regularly by your accountant logging in and having a look - you do that with your car don't you?
We owe it to our family and employees not to be reckless and take risks when driving our business. After all, we are allowed out on the business road without any training and without taking a test, so we need to take care.
So, I believe that following this advice, you won’t be risking the life of your business and its passengers; you will have a much better chance of getting where you want to and avoiding accidents along the way – leave those for your competitors.
If your business can afford it, employ a chauffeur so you can work on the rest of your business in comfort. You can look up whenever you want to see where you are!
Upgrade your systems and open your eyes.