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Want to learn more? Take a deep dive…

Ashe-Edmunds, S. (n.d.). Budget forecasting techniques. Chron.
Black, T. (2010, September 27). 12 Best tools for budgeting. Inc.

Hannabarger, C., Buchman, F., & Economy, P. (n.d.). Presenting financial reports: Turning numbers
into information. For Dummies: A Wiley Brand.

Tjan, A. K. (2009, June 8). The fallacy of financial metrics. Harvard Business Review Blog Network.

9. Want to improve operations? Understand audit. While perhaps not the most glamorous of
functions, audit serves a valuable purpose in any organization. By auditing the different facets of the
operation, important information surfaces—both on what’s going right and what needs fixing. Auditing
helps organizations to minimize risk. Increase efficiency. Eliminate waste. Save resources. Avoid
legal or regulatory trouble. And because they examine operating procedures in a detailed way, they
provide an invaluable look at how the organization functions—from the inside out. So if you are new
to the organization, or you want to make real improvements that will change the bottom line, or you
just want to know more about how things happen, get to know your auditor or audit team. Study the
reports they generate. Look for improvements you can make. If any area is of particular concern,
consider requesting a special audit. Studies show that when you define the problem, action follows.
Good audit information is a spur to decision making and improvement.

10. Disappointed by results? Study data to make course corrections. Organizations start the fiscal
year with great intentions. They produce forecasts and annual operating plans. Create budgets to
predict and control spending. Build marketing, sales, and staffing plans to drive growth. In a perfect
world, results would roll in as predicted. But variances are a reality. Costs exceed budgets. Sales lag
expectations. Investments fail to deliver as planned. You may not want to see these numbers, but
they highlight areas for improvement. Delve into this information. Get access to monthly and quarterly
reports and dig into the data. Where are variances occurring? How serious are they? What are the
causes? What is the impact? Sales lagging? Could be due to a flaw in the pricing or marketing
strategy. Costs too high? Could be external market conditions like rising labor rates or unforeseen
developments affecting the commodities market. What can you change or control to bring results
back in line with projections? One large manufacturer studied how to better predict markets. They
discovered that their own six-month leading sales number was the best predictor for economic
forecasting. This insight allowed them to make the right staffing and production decisions to meet
demand and stay in front of market changes. Get your team together to discuss what is happening.
Mine the data for insight. Focus on underlying causes and make corrections.

11. Obsessed with meeting goals? See the bigger picture. Yes, goals are important. You want to
realize a return. Build value. Turn in results. But to get the full picture, you need to look beyond the
numbers to the bigger picture. Financial results are vital signposts and ways of measuring progress,
not the ultimate reason the organization exists. If you are overly focused on hitting a number, you
may miss something else important. You could control costs but strangle growth. Maintain a tight
budget and miss an investment opportunity. When you’re setting a financial goal, ask yourself why it
is important. Consider what is at stake and what it will mean if you achieve that goal or fall short.
Consider both qualitative and quantitative information about the business. Think long-term as well as

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