- The My Business Manager™ Improvement Process
- Cashflow
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My Business Manager provides Cashflow Forecasts and Management with Instant Insights for You
Mis-management of Cashflow has been the number one cause of business failure for the last 60 years. More businesses fail for lack of cash flow than for want of profit. Cashflow forecasting is critical to business success.
Profit, the difference between sales and costs within a specified period, is a vital indicator of the performance of a business.
While a sale may have been secured and goods delivered, you may not see payment right away. At the same time, you have to pay suppliers, staff etc., you have to invest cash in rebuilding depleted stocks and new equipment.
The net result is that cash receipts often lag cash payments and the business may experience a short-term cash shortfall. For this reason you must forecast cash flows as well as project likely profits.
My Business Manager creates Cashflow Funds Statements that show the source of funds and where they have been used within the business. Once budgets and forecasts have been created, My Business Manager can forecast the cashflow required to fund the budgeted growth and show where you may need to extend overdraft limits or increase debt.
Here's what a My Business Manager Cashflow statement will tell you:
- Cash inflows (receipts from sales, increases in bank loans, proceeds of share issues and asset disposals, and other income such as interest earned)
- Cash outflows (payments to suppliers and staff, capital and interest repayments for loans, dividends, taxation and capital expenditure)
- Net cashflow: the difference between the inflows and outflows within a given period
- Cashflow projections and short-term banking requirements
- Possible funding requirements and likely financial consequences of alternative strategies
- The effects on cash flow of varying sales, costs or credit terms
A projected cumulative positive net cash flow over several periods highlights the capacity of a business to generate surplus cash and, conversely, a cumulative negative cash flow indicates the amount of additional cash required to sustain the business.
- Business Growth
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My Business Managers offers Instant Insight for Business Growth
Business growth is an essential consideration for any business. After all, if something is not growing, it is dying.
There are only 4 major ways of growing a business. My Business Manager provides the regular Business Snapshots and management reports you need to decide the appropriate strategy, and measure the results of your activity.
- Increase the number of Customers or transactions.
- Increase the average value of existing transactions.
- Increase the Gross Profit Margin on your products and services
- Introduce a new product or service
Business Growth 1 - Increase the number of Customers or transactions
MBM will show you this data on the Business Snapshot report. Increasing the number of customer or transactions means adjusting your marketing mix, or discounting your products and services. There are complex factors to be considered when trying to grow with this method.
- Set a budget and document what gains that you expect. Insist that it be measured regularly.
- Make sure the cost of getting a new customer is in line with the lifetime value the customer brings.
- Be wary of discounting. There is a direct relationship between the size of the discount and the volume of increased business required to gain significant growth.
Business Growth 2 - Increase the average value of existing transactions ("Do you want fries with that?")
MBM will show you this information on the Business Snapshot report and in the Performance KPI reports. Every sale is an opportunity to offer additional goods or services. Paint buyers need solvents, brushes, rollers, ladders, ground sheets, colour consulting, or recommended professional painters. Customers are already in "buying mode" and are more receptive to your suggestions.
Business Growth 3 - Increase the Gross Profit Margin
You can increase your margins in three ways.
Price - Schedule a price increase (or at least a review) every six months at minimum. Review the selling price each time that you purchase new stock if the price has changed. Be aware of competitive pricing. (Ask your accountant for advice).
Cost of sales - You must know the true cost of any item that you sell, including labour, commissions, packaging, credit terms. If you are not sure, ask your accountant to help to identify the true cost. Think about how you can reduce your costs. Can you buy cheaper, locally, can you import directly. Can you avoid transport costs, ship directly to the customer?
Mark-up - Understand the relationship between mark-up and margin (a 50% mark-up on costs will provide a 33% margin on sales). What are the mark-ups for your industry? Ask your accountant or ask an industry body. MBM will show you the average Gross Margin and Net Profit Margin on the Business Snapshot and detailed information on the Profit & Loss traffic-light reports.
Business Growth 4 - Introduce a new product or service
This strategy requires investment, planning, test marketing and caution. It is usually more important when a business has reached saturation or maturity with their existing products and services.
MBM will report on individual Groups and accounts so that you can analyse the revenue and profitability of new products or services. Set up a Group or create a separate Dashboard to make analysis easy.
- Budgeting
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My Business Manager™ Software: Instant Budgeting Insights
Why budget? We generally think of budgeting as a way of deciding in advance how much cashflow we need to afford certain activities: what do I need, and how will I pay for rent? For salaries? For raw materials?
More broadly, good budgeting software provides guidelines for managing future investments and expenses. It is also a statement of the financial position of the firm for a specific period.
The budget is an annual financial plan that provides forecasts and authorises, for each financial year, estimated future costs, revenue and expenditures and their detailed description and justification.
Good budgeting always includes forecasting cashflow: the movement of money into and out of the business that determines its solvency.
The MBM toolbox makes it easy and logical to create a budget you can achieve.
- Import the budget from your accounting system or Excel (if you have one)
- Use actual data from prior periods if you expect "more of the same"
- Update the "top-down" results from your forecast and then add details.
- Once you have a Profit & Loss and Balance Sheet budget, we produce Cashflow forecasts and Forecast KPIs to indicate future directions and results.
- Business Reporting
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The management and business reporting model of the future: online, real-time business reports from My Business Manager
Users today want "data on demand" in formats that allow quick access and analysis to help make better decisions, and My Business Manager is uniquely positioned to provide it. My Business Manager provides automated, accurate, no effort reporting for any business.
It takes time and expertise to trawl through the myriad reports that come out of tax-oriented accounting systems. Add to that copying the data into Excel spreadsheets, doing the necessary calculations and converting the data into a format business owners and managers can actually use to "manage" their businesses.
My Business Manager links to popular accounting systems, extracts the data, collects performance data from our secure website and then, without any intervention or effort, creates user-definable Business Snapshots and detailed reports that can be run weekly or monthly.
This new real-time business reporting is vital to protect credit providers, investors and other interested parties.
Today, if you think about a traditional tax or audit report, it says, "Yes, the financial statements that are covered by our report, which took place, in many cases, 60 days ago, are materially correct." This means that the business owner and manager is relying upon information that is after the fact. They do not know what happened yesterday or last week which, if known, might improve their decision.
Real-time reporting is a very positive step for protecting all business stakeholders and enhances the role the accounting profession plays in business management.
Key Business and Management Reports from My Business Manager
Executive Summary - Extract of key business issues
Dashboards - Your business at a glance.
- Quickly see how the business is going
- Identify problem areas easily and take targeted action
- Customize dashboards to reflect individual business needs
- Choose from a wide selection of reports and graphs (if you don't see the one you want, just ask)
- As many pages as you want - your choice
- Prepare different dashboards for different recipients (owner, sales manager, bank manager)
- Set choices as defaults - and produce them in less than 1 minute.
Comparisons of actual to actual, actual to budget (MTD, QTD, YTD)
Performance against Budget
Trends in Revenue, Costs, Profits and Margins
Traffic light reports - to locate and correct problem areas
Cashflow statements - to track where cash is used
KPIs - Balance Sheet drivers, Profitability, Liquidity, Investment/Equity/Capital
Profit & Loss - Top down or bottom up. MBM provides both methods.
Balance Sheet - Integrated with the P&L budget to make it even easier.
- Key Performance Indicators (KPIs)
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My Business Manager provides Key Performance Indicators (KPIs) Instantly
Key Performance Indicators (KPI) are financial and non-financial metrics generated by My Business Manager to define and measure progress toward organizational goals.
Managers use KPIs to assess the present state of the business and to prescribe a course of action. KPIs are typically tied to an organization's strategy (as exemplified through techniques such as the Balanced Scorecard and Business Performance Management or BPM).
Typically, managers will use My Business Manager to monitor and track:
Financial KPIs
Balance Sheet Drivers
- Have a major impact on cashflow
- Must be managed
- Are impacted by internal policies
- Should be monitored for any increases
Profitability
- Show how the business is performing
- Margins and profitability need to be monitored
- Have impact on funds available to cover break-even and to fund growth
- ROI shows business performance as an investment.
Liquidity
- Show the financial health of your business.
- Investment/Equity/Capital
- Indicate the financial strength of your company
- Show its ability to pay its own way.
Investment / Equity / Capital
- Indicate the value of the company
- The level of debt compared to value
- And the effectiveness of the business as an investment
Performance KPIs
With the My Business Manager web-enabled Performance KPI tools, you can assign sets of KPIs to individual employees in order to track the performance of;
My Business Manager tracks all of these dynamically so that you can see the trends and compare the performance of your business to other similar businesses.
- Performance Management
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My Business Manager plays a key role in unlocking the success of Business Performance Management (BPM)
Business Performance Management (BPM) looks at day-to-day processes, maps improvements and identifies key metrics that will define success or failure.
My Business Manager is Business Performance Management Software that takes the financial and performance intelligence that defines "how we do things around here" and instantly translates it into well-understood processes and reports that can be measured and tracked.
My Business Manager introduces the Monthly, Quarterly and Bi-annual cycles, into the Business Performance Management process, and provides the templates and procedures necessary to manage both Operational and Strategic issues.
Companies undertaking a broad-based business performance management (BPM) improvement initiative - whether or not it includes a technology upgrade - are embarking on an expedition of enormous change. They may be rethinking how to allocate resources; how to set expectations for performance in terms of revenue, margin, customer service, and other areas; how to gauge actual results relative to those expectations; how to reward (and possibly punish) managers for their performance.
The process must begin with a clear understanding of where you're going and how you'll know when you've gotten there. As well as budgets, forecasts, what-if, My Business Manager provides instant financial Key Performance Indicators (KPIs) tracking profitability, cost reduction, and liquidity in easy-to-read graphic format. Along with performance issues such as productivity, efficiency, internal and external customer satisfaction, culture, encompassing behaviour, values, and decisions, these financial data provide the tactical road map the organization requires in order to take action and evaluate interim progress.
Decision-making.
Employees make decisions every day, regardless of their position or level of authority. These big and small decisions become the drivers of change, so how decisions are made is vitally important.
Managers can use My Business Manager to make decisions quickly, based on real facts, ending reliance on intuition - which is often wrong. Decision-making responsibility can be driven down to the operating level with confidence. Conflict during and after the decision-making process can be reduced, and a clear process put in place.
Organizational structure or hierarchy.
Companies with strong and clearly delineated hierarchies are often built on the belief that people need close supervision in order to produce results.
Micromanagement is the norm, but effective change initiatives, especially in areas that affect as many people as budgeting or performance reporting, require independent thinking and decision-making.
Through its Performance Management capability, My Business Manager strengthens the ability of senior management to trust the judgement of lower-level decision-makers.
Source: BPM Change: How a Company Can Prepare By Shelley F. Hall Originally printed in the March 2008 issue of Business Performance Management Copyright © 2008 Penton Media, Inc.
- Balanced Scorecard
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My Business Manager™ plays a unique and vital role in the Balanced Scorecard
The balanced scorecard concept measures whether the smaller-scale operational activities of a company are aligned with its larger-scale vision and strategy. It helps provide a more comprehensive view of a business which in turn helps organizations to act in their best long-term interests. Most users are familiar with the 1996 book The Balanced Scorecard by Robert S. Kaplan and David P. Norton.
Balanced Scorecard helps focus managers' attention on strategic issues and the management of the implementation of strategy, and can comfortably co-exist with strategic planning systems and other tools such as Business Performance Management (BPM).
Implementing the scorecard typically includes four processes:
- Translating the vision into operational goals;
- Communicate the vision and link it to individual performance;
- Business planning;
- Feedback and learning and adjusting the strategy accordingly.
Balanced Scorecard for Small and Medium Businesses
Small and medium sized operations often do not have the sophisticated systems that allow larger organizations to implement balanced scorecard across all their operations.
In these companies, My Business Manager™ is invaluable in linking budgets with strategy. For example, managers use it to generate Key Performance Indicators from the perspective of the balanced scorecard, such as:
Financial
- Cash flow
- ROI
- Financial Result
- Return on capital employed
- Return on equity
Customer
- Delivery Performance to Customers
- Customer satisfaction rate
- Customer retention
Internal Business Processes
- Number of Activities
- Opportunity Success Rate
- Accident Ratios
- Overall Equipment Effectiveness
Learning & Growth
- Investment Rate
- Illness rate
- Internal Promotions
- Employee Turnover
- Gender/Racial Ratios
- Business Planning
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My Business Manager Provides Instant Insights into Business Plans
Why are business plans so important?
Very simply, because more businesses succeed with a business plan than without one. And of course banks and lending institutions absolutely require one.
Whether your focus is a large business or small business plan, using the Business Planning templates and tools in My Business Manager, you will know:
- Where you revenue is coming from now, and in the future
- How much profit you can count on
- How you will market your products and services
- How you will compete
- What potential problems you will face
- How much you'll need to invest or finance
- How to convince investors and lenders to fund your business
My Business Manager provides a range of Business Plan templates to suit all sizes of businesses and many situations.
Choose the template that suits your business, complete the question and answer format and, before you know it, you will have a complete business plan.
- Marketing for Accountants
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My Business Manager Accelerates Marketing for Accountants with Instant Insight for Clients
Most Accountants tell us, "I want more high-fee paying Clients and fewer low-fee tax preparation and compliance ones." But their accountants' marketing activities don't generate this kind of business.
A second big issue is simply lack of time "How can we offer additional services that Clients want and need without adding to our existing workload?"
That's where MBM can help.
My Business Manager provides a range of services Clients will not only enter into long-term contracts and pay higher-value fees for, they will expect to do so as part of your business support services.
After all, what Client does not want help in growing their business, solving their cashflow problems and generating higher profit.
My Business Manager includes a powerful strategy for Accountant Marketing that can generate long term contracts and predictable monthly fees for your practice.
How to Build Your Practice from Your Existing base in 6 Easy Steps
- Send a letter to each Client you believe is a candidate, announcing that you can now provide a wide range of Business Development Services. Attach Part 1 of the Business Health Check.
- Follow each letter with a personal call asking if they got the Business Health Check, and inviting them to complete it. (If you have a lot of Clients who qualify, send 10 per week so you can talk to each one personally. After all, this is the start of much closer relationships.)
- Clients who let you know they have at least tried the Health check have self-qualified: they know they need additional services, and they are prepared to explore what you can offer. Invite each qualified Client to your office for a Business Health Review, where you will go over the Business Health Check and review the answers. You will also answer all of their questions and help them to identify directions and strategies.
- At the session, demonstrate what you can do for their business and for their profitability.
- Ask them to agree to take part in a 12 - 24 month Business Improvement Program with standard monthly fee. Reassure them that they can terminate the program at any time if they are unhappy. Depending upon your own confidence, you can offer to "share in their gain" by identifying the potential growth in profitability and then agree on a share of those improvements (billed monthly in advance). This takes the focus from the fees onto the increased profits.
- Follow up with those who did not respond -you can often get an additional 10% response rate simply by resending the original letter.
With My Business Manager, you will be able to add high value services like these for your small business clients:
- Dashboards and reports to help them manage their own businesses
- Explaining MBM reports, what they mean and what they need to watch
- Hosting regular board meetings to review results and address highlighted issues
- Providing regular oversight with an Executive Overview service
- Providing a management review service with recommendations to address issues
- Providing business consolidations to show how combined entities are performing
- Helping with preparation of budgets based on past performance or future targets
- Helping to create a Business Plan which can be understood by all stake-holders
- Implementing a 12-month business improvement process with monthly / quarterly reviews
- Providing regular business mentoring on key issues
- Add-Ons for MYOB
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My Business Manager Provides Instant Insight through a Powerful Add On for MYOB users
Over 10,000 accounting practices use MYOB solutions and services to streamline processes and maximise their productivity. Over 700,000 businesses use MYOB accounting software, payroll software and real-time business management tools and MYOB Add Ons.
Now My Business Manager provides an MYOB Add On that makes MYOB even more powerful, with instant simple, colourful graphics and reports that turn accounting data into management information.
No longer will you have to run multiple reports or search through volumes of data.
My Business Manager extracts all of the key data that you need to effectively manage your business and produces Business Snapshots that can be used by all key management to check results.
My Business Manager Links to MYOB
"Basics" series - Accounting
"Manager" series - Accounting Plus and Premier
"Enterprise" series - Premier Enterprise
"Accountants Office"
"EXO (formerly Exonet) - MYOB's enterprise-level solution"
How My Business Manager Helps MYOB Users
Unlimited history for comparisons and trend reporting
Cashflow statements: where the cash came from and where it went
Budgeting: generate detailed operational budgets that reflect how your business operates
Forecasting:
- Revenue: create your 5 year plan based upon historical business results
- Profit & Loss: what do you need to achieve over the next 3 - 5 years to generate the profits you need
- Balance Sheet: plan the working capital that you will need
- Cashflow requirements: month by month, quarter by quarter, year by year
- KPIs: how will your business perform? Are you getting a good return?
Reporting:
- Business Snapshot report: your business at a glance
- Executive Summary: the critical items for your business in an easy-to-read report.
- Extensive management and summary reports: we provide preformatted reports, you choose the period and what you want to see, it's as easy as that! Whatever you are looking for, My Business Manager has it!
- Traffic light reports: red items need attention, green means on track.
Business plans for all types of businesses and for all stages of business: pick the one that you need and answer the questions. Before you know it you will have the best business plan that your bank manager has ever received!
Accountants and Advisors
Use MBM to provide an easy, standardized process. Run the Business Snapshot and detailed reports and provide advice on how to address issues that are identified.
Bookkeepers add these reports to existing services. If problems are identified, you can discuss them with the client or send the reports to their accountant for advice.
*Note: We want to be open in sharing that this product is not a product of MYOB and is not endorsed or supported by MYOB. However, My Business Manager is a Development and Marketing Partner of MYOB. For information on our support services, click here.
- Add-Ons for Quickbooks
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My Business Manager adds Instant Insight to QuickBooks
With over 4 million users and 35,000+ ProAdvisors, QuickBooks delivers a full set of solutions designed to help small businesses succeed.
Now My Business Manager makes QuickBooks even more powerful, with instant simple, colourful graphics and reports that turn accounting data into management information.
No longer will you have to run multiple reports or search through volumes of data.
My Business Manager extracts all of the key data that you need to effectively manage your business and produces Business Snapshots that can be used by all key management to check results.
My Business Manager Links to QuickBooks (2004 onwards)
- QuickBooks Pro
- Premier Enterprise
- Enterprise Accountant
How My Business Manager Helps QuickBooks Users
Unlimited history for comparisons and trend reporting
Cashflow statements: where the cash came from and where it went
Budgeting: generate detailed operational budgets that reflect how your business operates, then copy them back into QuickBooks
Forecasting:
- Revenue: create your 5 year plan based upon historical business results
- Profit & Loss: what do you need to achieve over the next 3 - 5 years to generate the profits you need
- Balance Sheet: plan the working capital that you will need
- Cashflow requirements: month by month, quarter by quarter, year by year
- KPIs: how will your business perform? Are you getting a good return?
Reporting:
- Business Snapshot report: your business at a glance
- Executive Summary: the critical items for your business in an easy-to-read report.
- Extensive management and summary reports: we provide preformatted reports, you choose the period and what you want to see, it's as easy as that! Whatever you are looking for, My Business Manager has it!
- Business plans for all types of businesses and for all stages of business: pick the one that you need and answer the questions. Before you know it you will have the best business plan that your bank manager has ever received!
Accountants and Advisors
Use MBM to provide an easy, standardized process. Run the Business Snapshot and detailed reports and provide advice on how to address issues that are identified.
Bookkeepers add these reports to existing services. If problems are identified, you can discuss them with the client or send the reports to their accountant for advice.
Note: My Business Manager is a Gold Developer and Marketing Partner with Intuit USA as well as a Developer and Marketing Partner of Quickbooks Australia.
My Business Manager can interface to all international versions of the Quickbooks versions specified above.
Due to current versions of Quickbooks not having the available functions, we cannot import budgets from QuickBooks for Australia and New Zealand Users. We expect this to be resolved this year. In the meantime, you can import from Excel.