Skip to content

Take time to manage your business

There are two parts to being in business, doing the work and managing the business. Most people in business spend way too much time doing and not nearly enough time managing.

Nirvana for an entrepreneur is when all they do is manage the business.This is when the business owner evolves into a Managing Director or Chief Executive Officer. However most SMEs simply are not big enough to sustain a full time person running the business. If this is your position then you must take time to stop doing the business and spend some time managing the business.

In my experience the best way to do this is to have a regular board meeting. Most businesses have monthly board meetings and probably miss one or two a year, so end up with about ten. Two monthly might be better for you, but I feel the minimum is quarterly meetings.

I also suggest you appoint either your accountant or someone else that you respect to act as your chairperson. This will give you the discipline to devote the correct amount of time and energy in managing your business. You may also want to include someone from your team and if possible another independent director with expertise in an area that you are weak.

The next thing you need to do is have some regular reporting. The Management Report in Xero is perfect for this and covers off all the key financial data. If you have a strategic plan that you have converted into a budget the Management Report in Xero can compare your actual results to the budget. This is an excellent level of reporting. It is likely that you will have some key factors that seriously affect your business that are nonfinancial and I suggest you look at the best way to collect that data and put it in a report, even better if it is being compared to a target.

Your board report needs to be published to your board members at least two days before the board meeting, to allow enough time for people to read and consider the contents, especially if the report includes items that require opinion from the board members. Board meetings are a great time to ask questions and consider different opinions.

Once you have your board report built you need to hold your board meeting. I currently sit on four boards, two of which I am the Chairman. The agenda I like to follow is:

   AGENDA

  1. Apologies
  2. Minutes from previous meeting
  3. Action items from previous meeting
  4. CEO report
    a. Next 3 months
    b. Sales & Marketing
    c. Operations
    d. Finance
    e. HR
  5. Specific Growth Plan
    a. Top of mind for the CEO
    b. Next hires
    c. Funding
    d. Execution
  6. Annual discussion topic
  7. General Business
  8. Time, date and location of the next board meeting

Board meetings normally run for one to two hours, but can sometimes be longer. You need to be careful that the time taken to build the report(s) for the board is not too onerous, or you will start to get sick of the process. Quite often in the case of board reporting less is more.

You will note in my Agenda above I have “Annual discussion topic” and I think that needs further explanation. Once a year I like to build an annual plan for the board meeting and come up with 6-8 topics that we need to consider and spend 20-30 minutes devoted to that topic at each meeting. Quite often these will come from the strategic plan. They quite often include big ideas, what-ifs, risk reviews, or reviews of certain elements of the business, like the marketing strategy for example.

I hope you agree that managing your business is as important as doing your business. True entrepreneurs can do both really well. Running board meetings may seem old fashioned to some, but they work really well. How important do you see management is in respect to entrepreneurship and how do you execute this in your business?

 

Read more about Business

 

7 comments

Jonathan Hughes-Deane
12 October 2012 #

Couldn’t agree more.
We do this with some clients and it really helps them to take a step outside their business and focus ON the business rather than being a slave to it. Xero makes this process much more efficient and timely too. Nice one :)

Nigel
12 October 2012 #

This is a really interesting topic. When I used to run a business that I did not own I found that board meetings were a brilliant discipline. A formal agenda – and your’s is very well thought out – is exactly what’s needed.

Now I am the sole owner of my own tiny business I don’t see how a board meeting could work for me. But the requirement for guidance (and self guidance) is still there, and I’ve recently been discussing this with a friend in a similar position.

Both of us own our own ‘micro businesses’ – and it’s lonely at the ‘top’! We want to get the right advice to help us take the long term decisions to make our businesses really grow. Neither of us have ever needed outside investment, so we have no shareholders, no other directors and no boards. Both companies have accountants who are not appropriate to chair a board meeting for one reason or another.

Ideas we have floated include taking investment just for the purpose of having a board meeting with directors who have something to lose or to gain; finding (and potentially paying for) a mentor; or retaining a small business consultant.

Do the accountants reading this recognise this problem in their tiny business clients? And how to people address it?

Ryan
12 October 2012 #

This is one of the most rewarding parts of our business, Timely. We provide an appointment scheduling solution for SMEs and the one piece of feedback that we hear more than anything is how much time our customers save by using it.

We love that they can use this time to manage their business, service their customers or maybe even have a break! Well, probably not a break. :)

For our own business – we set aside time for managing and organising – but it’s definitely a constant battle because there is so much “doing” to be done. Good article. Food for thought.

Greg Sheehan
12 October 2012 #

Love the Blog. Great stuff!

In my opinion those that have succeeded in business have three key attributes:

1. They have an attitude that will see them ultimately win

2. They work their butt’s off

3. They make smart decisions (at least they get more things right than wrong).

Having a structured Board meeting to regularly review a business will definitely help with the last one. Getting a talented few people around a table whose sole objective is to work on growing a business is like gold.

Gayle Buchanan
12 October 2012 #

Thanks Hamish, appreciate you taking the time to write this for all of us.
On the ‘small business’ side (no staff), it can be so easy to put your customers needs ahead of our own and before you know it – it’s Christmas!
So when you make the decision to get your head above the water – start 12mths out, work backwards in chunks of 90days so the year is now in quarters – put a circle around the week on the calandar (preferably on the wall you can see each day) and that’s review week.
Even if you just get out and catch up with fellow business owners the first time for a bit of a chin wag – it’s amazing how much better you feel just talking about some frustrations (or fascinations I’ve heard them called before).
After that the balls in your court – look back on the last year, are you where you want to be?
If not call a fellow xero bookkeeper or xero accountant and say ‘Hi’, can we catch up for a coffee please?
Just make a start.

10 and a bit weeks to Xmas …

Hamish Edwards
13 October 2012 #

Wow great comments guys. Thats a clear censuses that spending time at some form of monthly board meeting to consider the development of the business will help to make your business more successful.

Denis Breen
14 October 2012 #

great post, it’s the exact problem with many business’s including accounting business’s ( although nobody will admit it ). people spend all day working “in” rather than “on” their business.
Nigel’s comments above are very common, all I would suggest is 

firstly let the numbers and Xero reports be your other director, they will speak for themselves in terms of financial results provided you’re up to date. 

Secondly engage with a friend or someone you trust about your business on a regular basis in order to start getting some feedback.

Far too many business’s are stuck in the  “bill payer” mode, basically running flat out to stand still, and to a degree that’s ok as it’s not as if the bills dont keep coming, however you should be giving regular thought to how you are going to push past this stage and become an “accumulator”. That requires a strategy forcing you to step back from your business and assess where it’s going and what opportunities are out there to grow and generate surplus cash. Assess what skills are missing from your business in order to exploit current opportunities and try to include someone with those skills in your monthly discussion. Gregs comments about getting a few people around a table with the objective of growing the business being like gold is bang on. 

keep the posts coming hamish. 

Add your comment





We welcome all feedback but prefer a real name and email address.