Why you should review and update your Management Information

Task 1: Review and update your management information (MI)

Our ‘Ignite your Business’ series outlines a set of tasks for business leaders who want to ignite the growth of their businesses.

Because while the current economic headwinds are obvious, we see this time as an opportunity to reset, restate and refocus for growth.

And we firmly believe that the business leaders who will continue to increase the value of their businesses will be those that focus on the areas that add most value to the business, take time to understand finance, face the challenge head on, and seize opportunities when they arise. 

How good is your management information?

We’re regularly surprised by the poor management information found in many companies – or worse still, how many businesses have no decent management information at all – which significantly affects the leadership team’s ability to make strategic decisions and to take necessary action.

The businesses that will thrive in the year ahead, make the right strategic decisions, and cope best with any uncertainty will be those who understand every aspect of their businesses and finances, as close to real-time as possible.

So as a business leader, it’s critical you have management information that is accurate, timely, relevant and visible.

That’s why, if you want to ignite your business, your first task must be to review your current management information.

What makes good management information?

Your management information should provide a comprehensive overview of your business’s performance and include financial, operational and strategic data.

It should include key performance indicators (KPIs), benchmarks and trend analysis.

And it should be easy to understand and act on for all key decision makers and board members.

As a company leader, your MI should help you to assess your organisation’s financial health, review your ongoing performance and targets, identify inefficiencies, find ways to improve, address any new challenges or issues, allocate resources and find growth opportunities.

Above all, your MI should be up to date, and enable you and all other key stakeholders in the business (Directors, Board Members, Investors and Shareholders) to track progress and make the most informed strategic decisions possible.

What should be included in your board’s management information pack?

While every business will need slightly different forms of management information depending on the type of business and the industry in which they operate, typically in a Directors’ management information pack we would expect to see:

> Financial data and analysis including income statements, cashflow forecasts, balance sheets and other financial modelling

> Strategic data and analysis including market trends, competitor research and growth opportunities

> Operational data and analysis including production metrics, sales metrics, employee feedback and customer satisfaction scores

> Recent legal and regulatory updates

> Updates to organisational policies, procedures and protocols

> Key personnel issues – HR issues, recruitment and leavers

> Updates relevant to your company’s mission, vision, values and behaviours

It’s time to review and update your management information

In order to turbo-charge the growth of your business, if you don’t feel that your management information is supporting your decision making, you should start by reviewing your management information and putting the necessary systems and processes in place to make sure you can collect management information that is accurate, timely, relevant and visible and critically, supports your management team.

Here’s a key point: your competitors with good management information will be making informed strategic decisions weeks and even months before you are – so don’t be left behind.

If you’d like help putting together the right Management Information for your business, please get in touch. It’s what we do for our clients.