Promoted
Keeping your business fit for a healthy future
July 4, 2023
If a healthy mind begets a healthy body, then what of a healthy business? Too often, however, tending to an organisation’s long-term wellbeing – particularly for owner managers at the cut and thrust of the commercial world – is a challenging order. Help, though, is at hand. Here, Steven Hugill speaks to Michael Cole, associate partner at accountancy and business advisory firm Haines Watts, about how companies can not only retain their vigour but impel new energy to boost their pursuit of success.
Take a look at your wrist; what do you see?
Like many of us, you’re likely staring at a fitness tracker and its quarry of spiking heart rates, exercise regimes, calorie consumption and sleep patterns.
Now look at your business; are you able to mine similarly salient health insights? Or is its condition being affected by a lack of real-time performance analysis?
Because, in a world of swirling financial sentiment, where inflationary, interest rate, energy price and supply chain flux squeezes margins and impacts staff wellbeing and a business’ ability to retain talent, understanding an organisation’s wellbeing has arguably never been more important.
And for owner managers, whose personal health is bound inextricably to the fitness of their commercial ventures, the significance is yet more magnified.
“It’s imperative businesses are proactive and scan the horizon for change,” says Michael Cole, associate partner at accountancy and business advisory firm Haines Watts.
“They must be aware of the environment in which they’re operating while tracking data to ensure detailed focus on areas like cashflow, stock levels and profitability.
“Lack of visibility, lack of understanding and lack of adequate information can lead to bad decision-making and poor financial performance.
“That hasn’t changed for hundreds of years.”
A key facet in taking such initiative, says Michael, is an unswerving commitment to technology.
Flagging HMRC’s recent decision to close its VAT registration helpline – so long relied upon by firms to expedite applications – he says companies must harness the numerous benefits of digital operations, such as the greater support afforded to pursuing late payments.
He says: “As a business, it’s all about taking a step back and looking at things from a distance.
“It’s so important to plan for the longer term and understand how an organisation – even if things are going well – can create extra value by making small changes that materially add to operations.
“Having the ability to comprehensively understand a company’s working capital requirements, and any impacts of late payments, for example, is vital to future planning.”
Michael adds: “HMRC’s tag line is digital by default, and the closure of its VAT registration helpline is a sure sign of its focus on that sphere.
“And within such change, many businesses will go through their own digital transformation.
“But it is vital they continue the journey beyond their interactions with HMRC, and understand the opportunities offered by software, like tools which automatically email clients with a payment link when an invoice becomes seven days overdue, for example.”
While providing a conduit for potential greater financial security, however, Michael says such adoption will additionally aid owner managers’ physical and emotional wellbeing which, for many, remains heavily strained following the pandemic and subsequent economic and geopolitical events.
He says: “Being an entrepreneur is stressful and exhausting, and many have become tired and in need of a break after riding the storm of recent years.
“But there remains a tough period ahead, and owner managers need to continue putting in the work – and key to that is ensuring they have the right information to hand.
“Tracking cashflow forecasts, cost drivers and sales pipelines, for example, doesn’t guarantee success, but it does provide firms with more than a fighting chance.
“And that’s important in the ever-changing world.
“Some businesses have gone through redundancies, utilised the apprenticeship route and gone as far as changing lightbulbs to make their cost bases as lean as possible – but have then had to react to the national minimum wage rise.
“And others are going through the different demands brought by succession planning.”
Michael adds: “Change can sometimes make for difficult conversations in the short-term.
“But by investing in robust information management practises, which allow for the conducting of comprehensive health checks, owner managers are giving their businesses the best chance of success.”
www.haineswatts.co.uk