Podcast EP 108 | Getting Deep Monthly Reporting Right for Your Business

How do you get deep monthly reporting right for your business?

If you only skim financial and performance results on a monthly basis, you’re missing an opportunity to course-correct, learn and improve on what you’re doing.

Instead, teams should go line-by-line through financial statements, KPIs and priorities monthly to do a deep dive into results and look for any trends or problems that may require action.

Brad Giles and Kevin Lawrence discuss these points and more in this week’s episode of the Growth Whisperers podcast.




Please note that this episode was transcribed using an AI application and may not be 100% grammatically correct – but it will still allow you to scan the episode for key content.

Brad Giles  00:12

Welcome to the Growth Whisperers where everything we talk about is building enduring great businesses, businesses that last. My name is Brad Giles. And today as always, I’m joined by my co host, Kevin Lawrence. Hello, Kevin. How you doing today?

Kevin Lawrence  00:27

Doing great, Brad. It’s an awesome day or awesome evening as it is here up up in the northern hemisphere.

Brad Giles  00:40

Yeah, so today, we’re talking about getting your deep monthly reporting right for your business or business unit. Kevin, tell us a bit about this.

Kevin Lawrence  01:18

Generally, in a lot of companies as they grow, the monthly financial review and reflection and reset is something that people aren’t great at. Normally, they get an income statement and maybe a balance sheet that they review. And they look at it. And they might ask a couple of questions move on. And what we’re talking about is a deep stripped down breakdown of the enterprise, and a chance to kind of reset what we’re doing 12 times a year. And it could be a part of a deeper monthly strategic meeting in some companies, or just normally its own standalone meeting for many. But the fact is, is how do you master this discipline? And you know, you know, you and I have probably been a part of my gosh, it’s a couple of 1000 financial reviews have been part of as a part of strategic planning meetings, or for some companies that I might run just this stand alone, meeting people over a series of years. So how do you master the full dress down in business? So you come up with some awesome improvements. And, you know, I’ll share an example like, Walmart is notorious for their Saturday morning meetings. Now, I don’t know firsthand if they still do them. They probably do. But it’s where all the managers and leaders come back, and they go and do the full review of the business and make a whole bunch of changes on that Saturday morning that take effect immediately. So that they don’t waste a week. That’s a weekly discipline. We’re just talking about a monthly version here today.

Brad Giles  02:47

Yeah, and so there are trends that can be emerging that we want to pick up. And we’ve got to find a point to deep dive, closing out the month, closing out the financials, and being able to, I guess, trust the figures, and be able to dig into the the validated figures, it makes a big difference. What has happened. Now, I’m a big believer that we should spend most of our planning time and time looking forward and not backward. But equally, sometimes looking backward makes a big difference to observe trends. What what do we need? What are some substantial changes that perhaps we need to make?

Kevin Lawrence  03:32

Absolutely. And if you don’t, it might take you a quarter or a couple of quarters to get through and make changes that you could be making right now.

Brad Giles  03:42

Yes, yes, indeed, the the monthly within the meeting rhythm, the monthly discipline to dig deeper, it just, it just makes so much sense for the leadership team to apply that discipline. And I think it’s probably rarer than maybe in mid small and mid sized businesses, and many people appreciate. So taking the time and digging, digging right down, not just saying, Oh, what was the profit? What was the revenue, and then kind of leaving it maybe a little bit deeper than that. So what’s happened? I mean, and you know, the other point is, especially in a high inflation environment, we’re seeing things changing all the time, all across the p&l, deal, electricity, labor, you name it, there are so many things. And so we need to be digging into these things.

Kevin Lawrence  04:43

Awesome. So before we dig further into kind of some of our key points here, what’s your word of the day, Brad?

Brad Giles  04:49

Oh my word of the day. I am thinking about I’m thinking about onboarding, and I know that that’s, you know, it’s just been so much a part of my world, as I get this book closer to maturation that I’ve been writing. You know, when you’ve when you’ve got a hammer, everything looks like a nail. Now I take that first off, right? I know that. But it’s just because I’ve shared it now with so many people and the concepts within there. It’s just really resonated. So yeah, for me, it’s onboarding.

Kevin Lawrence  05:32

Iterate is my word. Today, it’s a word that I really, really like. And the idea of it is it’s constantly making little changes to make things better little iterations, little tiny changes is my word. So you need to continually iterate your onboarding process to make it better and better and better. Alright, let’s jump deep into this episode. So the whole idea here is everyone’s got their own way of looking at a business and breaking it down, everyone likes to look at it through a different window through a different lens, whatever you want to call it. And that’s understandable. And what we want to do is to provide you a solid way that’s connected to greatness, you know, and very fortunate to work with a number of private equity backed companies. And in those companies they have, because they’re, you know, financial investors, they have mastered getting the information or the business that they believe that they need. So I’ve seen some outstanding presentations, that the private equity backed companies and private equity companies, Matt mandate, we’ve also seen some ones that are mediocre and missing the mark. But through through private equity backed companies, amazing CFOs, who come from awesome, amazing organizations, people iterating stuff on the spot, been able to see greatness from a lot of different perspectives, and greatness that relates to improving performance. And that’s kind of some of the stuff we want to share with you today. And the first point is that the key here, no matter what you do is the discipline to stop, take probably 60 to 90 minutes, and just do a full review of the entire business. You’re stepping outside and analyzing the machine while it’s running. And and and that the decision makers of the key departments that would be like the CEO and executive team or at a divisional level or a team level, are having that time together to reflect and ask questions, understand what the heck is going on, what’s working, what’s not working and reset. And it’s almost like in a, you know, in a sporting match when you have you know, whether it’s halftime or quarters, if it’s American football, you got time, step back, look at the scoreboard, review what’s going on and review some game tape, if there was time, and adjust your strategy. And it’s just a monthly version of that, that we’re talking about it in a fairly deep level. So key point is that you just make the time to do it and have time to dig in, understand, ask questions and tweak what you’re doing. That’s number one. And it’s probably the most important point, do it. It’s a core discipline.

Brad Giles  08:17

And then we can talk about how to do it well, and do it with the leadership team so that the leadership team understands. Now, some leadership teams are very sophisticated, and they’ve spent their whole careers doing this, and others don’t. But you what are the things that are affecting all of the parts in the of the p&l, the profit and loss? And what are the things that we need to do to rectify them or to understand them deeper, just digging deeper with the whole leadership team, not just you and the CFO, or whatever it might be getting everyone to understand so that they ask more questions into the future.

Kevin Lawrence  08:57

And that’s what a great way to learn by watching other people review it and ask questions and seeing what they’re digging into. And then hearing the explanations. It’s, it’s a great, that’s an awesome point. So number two is look, what do you review? What do you look at? And typically what people look at is, well, not enough. So you need to look at your financials, which tell you the score at the end of the month, how you did on the income statement. And hey, I know how you stand on the balance sheet. That’s, that’s a the basics, generally not that insightful, but it’s a starting point. Second thing is you need to look at your KPIs, your operational indicators of what’s happening in the moving parts of the machine, right, instead of just the output of the machine and the cost of the machine, which is the financials. It’s what’s going on in terms of time, speed, quality and cost or effectiveness and all the different moving parts from generally all the departments of the business. So the operational indicators are you need to look at how people are doing at the goals. Ideally, look at the goals that accompany level, maybe an executive level depending on your company. And they also got to take a look at the people. So how are we doing, whether it’s customer feedback on one side of the equation, or employee feedback or anything that affects your culture, and then around people some of the most important stuff around your core employees, so financials, KPIs, goals, and then key people, including customers and employees.

Brad Giles  10:38

Because it’s not a quarterly planning session, but it is a deep dive, it is the opportunity to dig into all of these areas and to understand what, what are the results rather than what many smaller medium businesses do? Again, as I said earlier, which is looking at the kind of the key, the top line, the bottom line may be the gross profit or the cogs if they’re lucky. But there’s so many more stories to be told. And those stories within the p&l is what could make the difference between a 5% and a 10%. Or a 10. And a 20%. Business?

Kevin Lawrence  11:20

Yes. In terms of profit, yes. Or growth. And all those things helped to make you smarter to understand and make better decisions for tomorrow, next week, next month, next quarter. So that is absolutely critical. So that’s what you got to review. Right? You want to cover off the next one there.

Brad Giles  11:35

Yeah. So how to review I love this one, the Accountable party presents with the best data that they’ve got. So many people will use an excuse our we don’t we don’t report on that, well, okay, what’s the best information that you have. And if you don’t have the best information, it could even be from the gut. But you will get with the intent that you will get more sophisticated over time. But the best, the most important point there is the Accountable party presents. So if you’re accountable for sales, then you’re the one that’s presenting on sales, if you’re accountable for the manufacturing in this city, then you are the one that is reporting on that, or whatever it happens to be. Those people are reporting on it. They’re reporting against budget, and they’re reporting against last year. And they’re also reporting about their recommendations. So last time, last quarter Parliament last month, we were 5% below. And this is what we’re planning to do from here. They within that there’s a detailed breakdown on what matters most. And that’s it, they are saying what they’re going to do, but also they’re saying these are the most important things that have influenced that outcome. Yes, we’re talking about goals, their progress, where they’re stuck, and where we need help. Sometimes we under resource people, or we’ve got the people that aren’t right for the role, or in the wrong seat, or what have you. So understanding all of the pieces that in there, that makes such a big difference.

Kevin Lawrence  13:21

Yeah, and we’re trying to get to the root causes of the greatness or the problems. That’s why the Accountable person is presenting their section with their insights.

Brad Giles  13:32

Because they own it, and we need to let them own it and not not let the CEO or the CFO or someone else report on the numbers that they are in because that’s such an important part of their job is to own it, present it to the team, and then they celebrate their wins or losses.

Kevin Lawrence  13:52

And what a better way to get someone to audit by making them presented, because they’re only going to stand up there and look like a fool once or twice, hopefully once and not know it. And next thing you know, you see even leaders who aren’t very strong on the financial side, pre meeting with with with a director of finance or the CFO to get all their questions answered. So they fully under understand everything, they start showing up with slides with little call out boxes, explaining things, why this happened and what they’re going to do about it, you know, it’s a, it forces their growth. That’s awesome. And it’s your stunning. It is their story to tell it’s not the CFOs or the finance teams. Now the finance team might help you with it. But the operator should be presented, the owner of it should present it. The CFO might present the overall of the company. But when you start breaking down into pieces that should be by the owner. There’s another next ones that was the fourth one is to give context for the data. And it is this is a pet peeve of mine, Brad, it shows amateur hour in companies all the time and I know some people might not like that, but I’m sorry it’s the case. When you start looking at some of these numbers in need. Con text and email and one of my clients has the best reporting of I see some of my clients amazing reporting, I’ll say the best. But when we look at our key numbers, we look at them in line charts with normally five years of data, most of it monthly, some of it weekly, where we can see patterns. And we can see growth, or we can see a lack of growth. And we’ve got this company so sliced and diced and dissected. In our reviews, we know exactly who’s who in the zoo throughout the entire machine, what’s going on what’s not going on. But there was incredible context to the numbers because of the history, we also have an indicator of the goals. So the best way to present the most important numbers, not all of them is trend data, over three to five years, if you can. The second piece of context, that is insightful. And again, it’s in the advanced class. And it’s called bridges, EBITA bridges, gross margin bridges and bridges for every freaking critical number that you need to pay attention to. And what a bridge does is it takes what the budget was. And then where you actually ended up, even if the budget equals exactly the actual. But there’s a whole bunch of sub numbers that will be up or down. So it takes even if you hit your profit target, it could have been because you’re way stronger in one area and way weaker in the other you need to know that. So when you look at the bridges that tells you the sub line items that you overperformed and underperform to give you like double context on all of your numbers to give you a deeper answer to why the number ended up being that so bridges are absolutely freaking amazing and provide way more insight and context.

Brad Giles  16:54

You know, the thing that it didn’t say there was excuses. So that that point was about give me context. Explain. But surely, I don’t know how many times I’ve seen people try to use excuses to explain numbers.

Kevin Lawrence  17:15

And it’s like no, just give me the data, please. I’d actually don’t want your stories. Yeah, tell me what you’re going to do the data to know why. And then the solution of what you’re going to do. And the more data you have, the less room there is for excuses like LMU Ali, who was the CEO of Fordham was an amazing CEO of Ford, I think he came from Boeing before, remember this article, and I still have it. I don’t keep a lot of them. But this one was amazing. And he talked about a Ford, he got sick of all the stories and all the good news, and then people would miss their numbers. So he said Enough of that. He just had them present 300 charts a week. And then it would be red, yellow or green things. And then note actions. It’s a beautiful art article in Businessweek. I think about this, it’s beautiful. But it’s like this, just give me the numbers. Tell me how you’re gonna fix them. Save the BS for somebody else.

Brad Giles  18:05

And some people are so good at excuses. And and it’s like God, oh, it’s just disgusting. It’s like, I try to advocate there is no such thing as an excuse like that. We it’s not bad. But like we kind of we try to encourage teams to call out BS and excuses a BS. Okay. Yeah. So that happened. You know, what, what do you recommend? What are you going to do about it?

Kevin Lawrence  18:32

And you know, next week, next time better next time? Are you going to be better next time? How are we going to make sure this never happens again? Yeah. Okay, let’s move on. We got we got to pick up our pace a little bit.

Brad Giles  18:42

Accolades and remedies. Acknowledge the wins, of course. So we did say it’s not all about celebrations. But you know, business, you know, is an intellectual sport, there are wins. And what are we going to remedy? What is the person accountable recommend we do. So we made this point already a couple of times this time, a key part of ownership is one presenting to the leadership team. And to this is what I recommend to course correct. Now, you can’t just necessarily say that on the spot, you often have to prepare for that.

Kevin Lawrence  19:17

Say that again, Brad. That is the key piece if you’re showing up and hoping it works out and no and winging it. That’s not going to help what so want to share more about that one?

Brad Giles  19:27

Oh, preparation is everything when it comes to the types of meeting that’s, you know, everybody in the room can tell when someone hasn’t come prepared. And it’s just it just brings the whole quality of the experience and output down. Like preparation matters if you’re going to rock up to a meeting, and you’re going to say so this is the numbers of my area, my department. This is the you know, this is the trends. This is what’s happened and this is what we recommend to do about Got it. Like you can’t just turn up on the spot you need to have, be well prepared, anticipate questions and be confident in what you’re doing.

Kevin Lawrence  20:09

Yes, you’ve got to know the layer of information below what you’re presenting. So you can ask, that’s awesome. Great. So that was accolades and remedies come prepared with that. And finally, collective intelligence, what are the things that we need to discuss stuffs gonna come out, and that we need to make, we need to use the brains in the room us while we have the decision makers, decisive actions and or further debates or future debates, some stuff, we can’t decide in the moment, we might need to get some more information, spend some more time on it. But no matter what the meeting gets ended with crystal clear actions, decisions we made, or things that we’re going to work on coming out of it circulated to everyone to be able to follow up at the next meeting. And if there’s any real special meetings, like to people have to, you know, meet and talk about, they should be booking them that day, for some time within the next few days. Like action now, get it done. And make sure I go some people I know will be in meetings, they’ll be sending notes to their executive assistant, book a meeting with this person do this. Like, it’s just it’s kept. By the way. What does it tell you? If you’re not capturing a bunch of action items in the meeting?

Brad Giles  21:21

Well, there’s no accountability, there’s no things aren’t gonna get done. It’s a waste,

Kevin Lawrence  21:25

Nothing’s gonna change. And it was a, it was a waste of time. Nothing is gonna happen. Nothing is gonna change from the course of action, or the course it’s already on. Because it’s a discipline and as a leader, there should be so we had our on our team meeting recently met our quarterly. It’s probably like 15 actions, maybe 10. I don’t know. They’ll come out tomorrow. But there’s a bunch and just throw the bid Okay, let’s action not so and so take this you know, it’s that’s that’s if effective use of any media.

Take a couple of minutes to reflect. Hey, team, what was really good about today’s meeting? How do we make it better next time? Yeah, it ain’t rocket science. It’s iterating. Remember my word upfront, iterate, iterate, even iterating. The meeting that you’re iterating the business? Just how do we how do we make this a little bit better next time? Not rocket science? Is there? It’s a powerful question to ask at the end while you’re all in the room and fresh from the meeting.

Brad Giles  22:29

So two key points. The last one was about capturing the who is going to do what by when. And this one is asking a simple question at the neck at the end of a meeting. What are we going to do better next time when we have this meeting?

Kevin Lawrence  22:42

Yes. And finally, the bonus, the super pro, you know you’ve dialed this in when all the good information goes out a few days in advance. So people can pre digest it and come with even more intelligent questions. Now, some people are not good at reading pre meeting information. Some people are really good at it. But as a discipline to read it in advance and prepare is extremely powerful, if at all possible. And it’s not always possible. I love it when I get pre information from most meetings, because I can scan it quickly. And it helps me to get grounded in it. And not, you know, falling asleep during 100 Page PowerPoint of the financials.

Brad Giles  23:32

This is what we’re going to talk about come prepared with your questions, we will have an engaging debate so that we can make the right decisions. And then we will have addressed and moved the company forward significantly at this month’s meeting. That’s what matters.

Kevin Lawrence  23:49

So when it’s done, right, what it sounds like is the CFO makes the high level presentation on the financials for a few minutes. You know, the department heads might touch on a few key things. And then people could say, hey, on page 58, there was this can you give me more information, rather than have to go through the 158 pages? Awesome. So great conversation around this critical monthly dress down of the meeting that has of the business and as the intent of how do we get better and improve our financials, KPIs, goals, and with our people and generally make some better decisions so that we can continue to iterate and make better performance. The first one was it’s just number one make the doesn’t make the damn meetings happen, make sure they happen. And if you’ve got multiple divisions, you might have two or three of these meetings every month. That’s fine. The meeting is just as much for the operators as it is for the executives that would be attending the meeting with the operators reviewing their business and learning the discipline to be prepared to present but make the discipline happens number one, number two, what do you review financials, KPIs, goals and key people slash customer insights? How’d you review it? The accountable party presents and they come very well prepared, how they doing versus budget versus last year, you know, digging into the goals and where we’re at what we need to do to get them done deep diving on people on internally and customers and just giving the information we need to get a sense of where we’re at what we might need to do different.

Brad Giles  25:23

So next is, well, the worst way that you can do it is give me an update, and give me an excuse. So we want the opposite of that. Okay, we want the context, give me the give me the update, or the number or the KPI. Give me the context as to why that’s happening and digging deep into what is causing that to occur. And then what is the trends around that number, weekly, monthly, even annual, even three years could be the right trend depending on the KPI. So there’s no such thing as an excuse. Next is accolades and remedies. Accolade the win acknowledge the wins part of me, and what do we need to do about it? Who is the person accountable? How do they recommend? Or what do they recommend that we do about this to fix issues problems, to auto maintain successes, then finally, collective intelligence? So that is understanding that we need to capture things along the way through these meetings, through tools such as the who, what wins? And also what do we need to do next time better? Or how can we have this meeting better next time. Kevin, do you want to close this out?

Kevin Lawrence  26:42

Yeah. And the bonus is getting all the key information in advance or some of its will be able to review and not just reviewing it on screen. Oh, great discussion. Brad. I love this one. I’m so passionate about this. I just see it’s a missed opportunity for many companies. So thank you for listening this week. This has been the growth whisperers with Kevin Lawrence and Brad Giles. Brad and I both have what we think is interesting and informative newsletters, you can get Brad’s at evolution partners.com.au And mine is at Lawrence and co.com. So have a great week. We encourage you to dig in and grind out a review of your business so you can make it better.