Death, Taxes and Forecast Error
Focus on What You Can Actually Control
We are in the middle of helping a client restart a business that was on the verge of shutting down just three months ago. It’s an interesting story in itself, but that’s for another time. Suffice it to say, we need a forecast for a lot of reasons. The problem is we don’t have an adequate basis – there’s nothing useable from last year, and there are no useful numbers from this year. The only thing we can actually be certain of is that a portion of our forecast will be wrong. It’s the predictive nature of the beast! The key is to make sure you’re close (not exact) and don’t spend too much time on things you can’t control.
The New Hire You Really Can Afford
Increase the Value of a Business Before It’s Time to Sell
We live in an on-demand world where you can get almost anything you want, whenever you want it. But one thing you can’t get immediately is increased value in your business. That takes time, effort and sometimes the expertise of a professional who specializes in this field. Most business owners think they can’t afford one. That’s totally wrong. And if you’ll crunch some numbers with me, I’ll show you why.
What We’re Reading 2016
What are you reading in 2016? We’ve created a carefully curated list of our favorite books from the past year, and we hope they’re a resource for your business in the year to come.
Momentum in the News: AIRA Journal
Momentum partner Patrick Stewart is featured as a top story in the Association of Insolvency & Restructuring Advisors Journal for his article on dealing with the unexpected in business.
Achieve a Better Budget Through Balance
“I’m gonna cut costs.” That was the response offered by a presidential hopeful when asked how he would balance the federal budget. The truth is that in politics or business, sweeping cuts are rarely a path to success when creating an effective budget. At best, they lead to a temporary state of relief, and at worst, they can destroy a business. Here are some better alternatives.
What Will Expansion Do for Me?
Recently Momentum Advisors assisted a client who wanted to open a second location, after great success with the current one. Our key tasks were to guide the expansion through detailed business plans, cash flow models and “what if” scenarios, as well as financing negotiations with banks and investors. These should be on the “to do” list of any diligent business owner or investor. But here are three things you may have never considered before embarking on an expansion.
Momentum in the News: Smart CEO
How to Find & Keep Your Superstar Employees
Losing an employee doesn’t just cost money – it means you’re losing time and, potentially, valuable expertise. Nevertheless, business owners often don’t take the time to analyze the success of their retention efforts before it’s too late. So what strategies should you pursue to keep those employees you can’t afford to lose, and how do you find them in the first place?
Momentum in the News: Philadelphia Business Journal
Wow, I didn’t see that one coming! Dealing with the unexpected in business
Anybody who has owned or operated a business in the last few years would probably agree with the old adage that “the only constant is change.” While change can be good, it can also spell trouble, and it often hits us when we least expect it. So what’s a company supposed to do? Protecting your company starts with a detailed understanding of what’s going on in the business.
Costs Are Like a Waterbed: How to Really Lower Costs
Streamline the process, make it simpler and make it cost less every time you run it.
I heard the phrase “costs are like a waterbed” recently in a discussion about how expense management often doesn’t live up to expectations. Press cost down in one area, and it inevitably increases somewhere else. For instance, a concrete manufacturer chose to postpone routine maintenance expenses to save $5,000. The short-term savings were appealing, but when a key piece of machinery failed and brought the entire business to a standstill, the expense and downtime far outweighed the initial savings.
Best Business Ratios
Ratios are a quick and easy way to check the pulse of your business, but like a doctor’s diagnostics, a pulse is only the first step. Knowing which ratios, what inputs and how to interpret the results are just as important. The first few ratios listed here aren’t too common, so we will explain why they matter, as well as how to calculate them. The rest are fairly common and there is a lot of discussion about them on the web, so we’ve added our thoughts about how to interpret them and what the results can mean for your business.
What are You Reading?
So many choices, so little time. That’s why we’ve created a carefully curated list of our favorite picks. For us, learning is a life-long process.
Learning from the Errors of Our Ways?
The highly respected Toyota Production System and Lean concept both preach that mistakes are treasure, not trash, and we agree wholeheartedly. While we all strive to avoid making mistakes, every error holds a valuable lesson, and if we don’t take time to reflect on mistakes, we miss an opportunity to make improvement. Reviewing errors also serves as a great way to let employees know it’s okay to admit mistakes and learn from them.
Would You Buy Your Own Business?
The Answer is in the Process
It’s a powerful question if you are honest with yourself. Imagine for a moment that you did not already own a business and an exact replica of the one you currently own was for sale. Would you buy it? Is yours one of the good ones? Are you better than your competition? What it is that makes you better? if you can point to above-average performance metrics or a Lean distribution system, great! If you answer “hard work” or “dedication”, you may be headed in the wrong direction.
You Can Keep the Change
There is so much advice about change that it fills the pages of innumerable books found in just about every manager’s office. Admit it, you probably have one. If you ask anybody about an existing process, they will probably come up with a way to change it. There are as many reasons to change something as there are to keep things the same. With so many different opinions, it’s hard to know which direction to follow. But let’s forget all that for a second and assume a business needs change and you have determined the ideal path. The important, and often overlooked, question is, how do you make a change sustainable? The truth is that usually change doesn’t stick.
Houston, We Have a Problem:
Use Diagnostic Tools and Stop Fighting Fires
Realizing there is a problem with your business is easy in most cases. The hard part in identifying the cause of the problem, and then creating to address. Unfortunately, most managers spend too much time “fighting fires” without regard to their causes. In some cases, firefighting has become an accepted part of day-to-day operations. While it’s understandable that some issues arise that require immediate attention, business shouldn’t be about fighting fires. Well-run businesses build in the necessary time to identify and handle problems before they burst into flames.
Momentum in the News: Smart CEO
Risk & Reward: How to Ensure Your M&A Transaction is Profitable
Anyone thinking about undertaking a merger or acquisition knows the extensive amount of planning that goes into it even years before the final deal comes to close. Sometimes, problems arise that CEOs and even business advisors may not have been able to plan for. But knowing what to expect during the first year of a merger can easily help put your company in the right direction.
Distribution System Dilemma:
Whether Robots or People, Process is the Key to Success
You’ve probably heard about drones delivering packages in the not-too-distant future, and I believe it. There is so much technological capability available to distribution centers these days, it’s almost scary.
I’ve seen some amazing distribution centers – dimly lit rooms with unmanned machines cruising around grabbing widgets and dropping them into predetermined boxes to be conveyed to the loading dock with military-like precision..
Momentum Advises Small Businesses For Success
By Kathleen Carey, Delaware County Daily Times
SPRINGFIELD — Whether it’s slightly tilting the boxes at a distribution company or preparing the due diligence for a $200 million company to more than double in size, Momentum Advisors exists to help small businesses change for the better.
With the recent history having been one of survival and turnarounds, the economy is staring to change the business landscape.
“Most companies are doing OK or starting to improve,” Stephen E. Judge, partner at Momentum, said. ““The question is,
When You Are Hiring Less, You Must Hire the Best
By Charlie Hauck, President, Growth Dynamics
The era of unlimited hiring that ended about 60 months ago when the world economy tumbled to near Depression depths has seemingly passed. We have returned to the days when employers are now believing new business demand will keep pushing onward and upward, and are adding employees, without much consideration of how those new hires will affect the top or the bottom lines. The biggest concern may be having a body in a customer service seat, out in a sales territory or available to process new patient admissions. Qualifications and compatibility appear once again to be taking a backseat to the perceived urgency to fill a position, and to a belief that “good people” are still the hardest thing to find. “Is the candidate breathing?” seems to be the screen most people are required to pass through to get hired in most search and selection process.