What is the ideal monthly management pack?
Over the past two weeks, AccountingWEB set out to establish what kind of information should appear in monthly management accounts. Here's a summary of the debate so far.
Relevance
"There is no magic pack," said Jon Moulton, chairman of venture capital firm Alchemy Partners.
Continued...
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Link reports to strategic measures
The key point to any management information pack is that it "enables effective decision-making". Effective decision making is dependent on sound and rounded information. ie it is NOT just financial, and is NOT purely historic.
At Genesis Ltd we focus on supporting the development of wider strategy backed up with financial plans. All management information must be aligned to strategic measures, and as concisely as possible.
So what I would emphasise are two furtther aspects:
1. Balanced Scorecard measures are key to any worthwhile management/leadership information pack. That means considering the health of a business in 4 dimensions [market and product/financial/people and organisation/process and facilities].
2. Focussing on the purely financial, it is critical that the pack Not be restricted to LAG indicators of performance, but include LEAD indicators. In my experience THE MOST important measure of all is the SALES ORDER BOOK [sometimes called the Backlog Report]
This is particularly true of smaller and growing companies, where an early indication of prospective performance and cashflow is vital to allowing composed consistent decision-making in the face of tight finances.
David Hughes-Hallett MA, ACA
Business Advisor
Email: david.hugheshallett@btinternet.com
Robin Gomm's Comment - Ideal for SME manufacturers.
Is Mr. Gomm using inhouse oftware or is his company selling software.
We should get some more details to consider using it.
Cheers!!!
Jamshed