ronattpa: Help entrepreneurs improve financial management skills

_FieldCaption_About Me_View

Nickname:	ronattpa Skokie, IL United States
Blog:	www.theprofitacademy.com/blog

ronattpa Photos

ronattpa

0 votes

Polls

By ronattpa 1519 Days Ago
0 points
As a follow up to my question about how much entrepreneurs struggle with finance and accounting, I want to get a sense for whether they want to do something about it or not.
By MattThomas 1519 Days Ago
0 points
I agree mostly with the third option, as it implies that entrepreneurs don`t have enough time to learn everything.

But I`m also think that a main reason is because entrepreneurs think they have a better handle on finance than they actually do. They start a venture thinking they understand the financial side of it, only do discover that they don`t.
By passion09 1507 Days Ago
0 points

I dont agree to what you have to say Ken,

I think an entrepreneur need not know the accounts himself. He can either hire an parttime consultant , or a small software for accounting which most of the entrepreneurs are doing. They need to know just the basic little. Ofcourse an Entrepreneur in a Financial Institution cannot afford to say so, but they need to know in and out of their business & their area of specialization. Rest all, is automatically taken care of.

And who else would know managing funds than the Entrepreneurs?
By CFOHammond 1501 Days Ago
0 points
Interesting discussion. I contend that accountants of which I am one have failed to educate business owners about they need to be financially intelligent, i.e. what are the key metrics that drive their business and where are they to be found. Not every number on the financial statements inform the business owner and leads to good strategic decisions. Too many times the financial statements are given to the business owner without sufficient explanation. We have to do our jobs better before we can expect them to theirs better and be more responsible financially.

Susan C. Hammond
www.schammond.com
By OfficeGoddess 1470 Days Ago
0 points
Too many times the financial statements are given to the business owner without sufficient explanation. We have to do our jobs better before we can expect them to theirs better and be more responsible financially.

Hear, hear! With new clients I make a point of discussing what the financial reports really mean once their QuickBooks files are cleaned up and/or created. This is not a long process and, if push comes to shove, I won`t charge them for it (although obviously I prefer to not work for free!) because I firmly believe that understanding cash flow strengths and weaknesses is a huge part of a company being successful.
By baloga 1413 Days Ago
0 points

You are absolutely correct that “…that business owners must be continually educated on what their numbers mean.” Some of that might be self inflicted by the owner, i.e., do they really have an interest in knowing the details?

Every company has an organization chart and I don’t mean President/CEO at the top, VP’s, etc. in the middle and then branching out to managers and supervisors. Picture a pyramid. At the top is a finder, in the middle are minders and at the base are grinders.

Finders – the business owner who likes going out to find new markets, new products and new customers. He/she likes to think about the big picture and not sweat the details.

Minders – people in the finance, IT, HR, etc. areas that worry about the keeping the business moving along. They make sure that the day-to-day inside the “fours walls of the business” is being taken care of.

Grinders – this may include people like customer service reps handling phone calls. He or she is only concerned with that customer currently on the phone (the here and now) and are not concerned about accounts receivables or inventory levels.

At some point after sales are taking off, the owner starts to build the infrastructure of the business, e.g., adding employees, computers, maybe a larger warehouse. All of a sudden, the cash needs exceed the revenue being generated. Now the owner is forced to perform “minding activities,” i.e., worrying about making payroll, negotiating repayment terms with delinquent customer receivables. It may include talking to the bank about obtaining temporary waivers of loan covenants. This is probably not something that they like doing or they are good at doing.

This is usually the point at which the owner looks to bring in someone to help put out the fire(s). Hopefully it is still early enough in the process where there is no permanent damage so to speak.

Most people are not good at everything, the key is to recognize one’s limitations and then find someone with complementary skill sets.
By ecodisplayware 1411 Days Ago
0 points

The problem here is the accounting software is designed for accountants and not business owners. There is not a single package that is affordable that is designed for business owners and is automated enough so business owners can focus on running the business. Many of them don`t have good integration tools to integrate with eCommerce sites. Yes, there are some that claim integration but once you get into it, there is a lot of manual data entry to do.

Everyone says how good Quckbooks is. The online version is crippled and terrible. But it really isn`t. MSFT`s Dynamics GP is also way too complicated. There are few online cloud based systems that are coming online like workingpoint but they are so lacking in features to be not worth it.

As a business owner, I would like to see an accounting system that is cloud base (online), can be totally integrated with eCommerce, has a rich inventory control and automated purchase ordering system. The CRM and manufacturing capabilities can be optional. All data should be easily exportable and importable . Every screen and report should be this way. All financial statements should be automatically generated and formatted and should be exportable to excel. This allows us to focus on running the business and all the accounting part is taken care off. Invoices are automatically sent out to customers via email or fax. The only time, a human needs to get involved is if you really have to send it via snail mail. The system should be exception based so it only notifies you of exceptions that you need to handle rather than every transaction.

I have often thought about completely re-writing the software to make it more of a business management software tool rather than an accounting tool. Still looking....

Regards,

Neil

www.ecodisplayware.com
By baloga 1410 Days Ago
0 points

Everyone would like such an integrated package (if anyone comes across one let me know and I will recommend it to clients).

It is similar to most business people are not good at everything. The same can be said for accounting products. A general ledger package is nothing more than a means to keep score. Most packages excel at a few functions but are mediocre at others. That is why there is plethora of third party add-on products for most packages.

Sure, we want to see financial results in a clear concise manner, but then what? When it comes to minding activities, an owner is still going to need the human element. Does the owner have the ability to interpret those results? You want to be able to “slice and dice" the data. This is where most accounting packages come up short.

The only other thing where a totally integrated package will come up short, is giving the owner the ability to bounce ideas off of someone and talking about “what if” scenarios. Sure we can bounce ideas off of one another in forums like this, but there are limitations when it comes to strategy and tactics. (NDA’s aren’t required).

Can they effectively keep shifting gears and wearing different hats? Many people might be able to juggle 3 or 4 things adequately, but as the number of things start to increase - what starts to slip through the cracks?

Show 6-8 of 8 discussions

_FieldCaption_My Business Interests_View

Headline:	Help entrepreneurs improve financial management skills
Description:	TheProfitAcacemy.com helps entrepreneurs and small business owners increase their profits and cashflows, keep more of what they make, and maintain the financial health of their small businesses.

Forum Posts

Contact Us Privacy Terms of Use Become a Marketplace Provider Advertise Local Guides Site Map Home Business Start a Business