Get Monthly Business Reviews Right

Are you con­duct­ing thor­ough month­ly busi­ness reviews?

As they grow, many com­pa­nies don’t take the time to review, reflect and reset what hap­pen­ing in their busi­ness every month. They usu­al­ly look at an income state­ment and maybe the bal­ance sheet. Although this is a good start, it’s often not deep enough to iden­ti­fy the most impact­ful oppor­tu­ni­ties or problems.

These are the com­pa­nies miss­ing an oppor­tu­ni­ty to course-cor­rect, learn and improve. So, whether a part of a deep­er month­ly strate­gic meet­ing, or a stand-alone meet­ing, this review is a crit­i­cal dis­ci­pline worth mastering.

If you wait for the quar­ter­ly meet­ing, it might take anoth­er quar­ter – or two – to make changes that could ben­e­fit you, right now.

There are many sto­ries with­in Prof­it & Loss that could make the dif­fer­ence between a 1% to 5% or 10% to 20% prof­it and growth — things that help to make you smarter, to under­stand and make bet­ter deci­sions in the future.

Wal­mart is famous for their week­ly Sat­ur­day morn­ing meet­ings when all the man­agers and key lead­ers come togeth­er to do a full review of the busi­ness, and to make changes that take effect imme­di­ate­ly. They don’t waste a week. That’s a discipline.

deep Month­ly Busi­ness Reviews

Here’s how to do a full, 60 to 90 minute review and analy­sis of the entire busi­ness, by the CEO and lead­er­ship team. Think of it as a sport­ing match – at quar­ter- or half-time – when you look at the score­board, review what’s going, watch the game tape, and adjust your strategy.

By the way, this is also a great learn­ing oppor­tu­ni­ty for the team as they par­tic­i­pate in the review, ask ques­tions and hear explanations.

1. Cre­ate a core discipline

• Sched­ule time every month to reflect and ask ques­tions at a deep level.
• Under­stand what is going on: what’s work­ing, what’s not work­ing and what affects all the parts of your prof­it and loss.
• Make key deci­sions to lever­age a bet­ter oppor­tu­ni­ty or resolve impor­tant problems.

2. What to review

• Finan­cials – The score at the end of the month, the out­put and cost of the machine.
  • How you did on the income state­ment and bal­ance sheet ver­sus budget/​expectations.
• KPIs – The oper­a­tional indi­ca­tors of what’s hap­pen­ing in all mov­ing parts of the machine, from all departments.
  • What’s going on in terms of time, speed, qual­i­ty and cost or effectiveness.
• Peo­ple
  • Employ­ees:
    • How are peo­ple per­form­ing com­pared to their goals and KPIs?
    • How strong is your cul­ture and engage­ment? Look at any feed­back and any­thing that affects cul­ture and their abil­i­ty to do their work.
• Cus­tomers:
  • How are we per­form­ing in terms of what cus­tomers expect from us?
  • Are we on time, on qual­i­ty or spec?
  • Look at feed­back and any­thing that affects cus­tomer sat­is­fac­tion and efficiency.

3. Present the data

Ask the account­able par­ty to present the best data avail­able to get to the root caus­es of great­ness or prob­lems. No excus­es, just data. Here’s what to include about Finan­cials, KPIs and People:

• A report against bud­get, and against last year with a detailed break­down of what has influ­enced the out­come and what mat­ters most.
• Insights and recommendations.
• Progress on goals, where you’re stuck, and where you need help.

When you know you are account­able, you’ll do your home­work to under­stand, and you’ll grow. It may not be per­fect, to start, but you’ll get more sophis­ti­cat­ed, over time.

4. Give con­text for the data.

Look at your key num­bers, ide­al­ly in line charts, with up to five years of month­ly data, to get con­text and see pat­terns – espe­cial­ly in busi­ness­es with any form of sea­son­al­i­ty. You’ll know, at a glance, exact­ly what’s going on.

Cre­ate bridges for EBI­TA, gross mar­gins and any oth­er key num­ber you need to pay atten­tion to. A bridge starts off where the bud­get was, and then shows every sin­gle vari­able that makes up that num­ber, and whether each indi­vid­ual vari­able is above or below what was expect­ed. This gives you a very detailed visu­al break­down of why the the actu­al end­ed up dif­fer­ent from the ini­tial budget.

5. Appre­ci­ate what’s work­ing and where you are winning.

This is often for­got­ten when things are work­ing well. Make sure you acknowl­edge and cel­e­brate the wins. This is where tremen­dous val­ue can be cre­at­ed in the meet­ing if there’s time.

6. Clar­i­fy deci­sions and actions.

• Be crys­tal clear on deci­sions you have agreed to and actions that need to hap­pen before or at the next meet­ing — who is going to do what, by when.
• Book any fol­low-up meet­ings or actions to take place in the next few days.
• While you’re fresh, take a cou­ple of min­utes to reflect and iterate:
• What was real­ly good about today’s meeting?
• How do you make it bet­ter next time?

Note: If you’re not cap­tur­ing a bunch of action items in the meet­ing, there’s no account­abil­i­ty — noth­ing will hap­pen and noth­ing will change.

Bonus

The dis­ci­pline to read and pre­pare in advance is extreme­ly pow­er­ful. You know you are super pro when all the good infor­ma­tion goes out a few days in advance, for peo­ple to pre-digest and come to the meet­ing with even more intel­li­gent questions.

You can at least scan and get grounded.

The Chal­lenge

• What can you do to make your month­ly report­ing and month­ly busi­ness reviews 10% better?

Want to hear more? Lis­ten to Episode 108 of The Growth Whis­per­ers.

Learn the habits you need to be ready for the week and how to hold your team account­able.