BUSINESS PROCESSES & THEIR IMPORTANCE
It’s no surprise that an agency might look for a new accountant and advisor during turbulent times and, whilst it’s unlikely the previous accountant is to blame for the problems, a fresh start with a new advisor could be just what you need. What does surprise me when I look over these agencies is that they weren’t always in dire straits, in fact, many of them were coming off the back of bumper years where cash and champagne did rain.
So, what went wrong? There are myriad reasons including media fragmentation and half-arsed reinvention in a digital age, economic downturn (GFC anyone?) and, ironically enough, poor marketing and sales strategies. These reasons are all posts for another day for the reason I see most often (and the matter I’m best able to advise on!) is failure due to lack of proper business processes.
General business processes (and how you can improve upon them) are covered in this post here. What follows are a few areas that are specific to agencies that are simple to implement and can have a lasting and profound affect upon the business. Hopefully if you follow them you won’t end up on the scrap heap!
This one is a massive issue with agencies who are typically characterised by high wage bills, inconsistent invoicing policy, large/lumpy income streams and a lack of debtor management procedures. I’ve written another post on managing cash flow here which is relevant for agencies. Get the processes in place, make sure they are being followed by all staff and adjust as necessary.
Failure to plan is a plan to fail (or something to that effect). Owners and management should be meeting at least once a year to assess and revise the business plan to ensure the business is heading in the direction they want it to. Some great posts on business planning are here and here.
As with any service business your staff are your most important asset and it’s crucial that you treat them as such. Ensure you check in regularly with your team to make sure they are happy and productive. Ensure the team all have a really good handle on what is expected of them and what the future may hold for them at your agency. Read more on this topic here.
It’s very easy to forget to keep the new business pipeline full when you’re busy, but it’s precisely when you’re busy you need to be looking to the horizon to ensure that your schedule (and that of your team) is not only full this month, but for the many months ahead. Learn more about the pipeline here.
And what happens if you fail to put processes in place to handle the above (and more)? It commonly results in the over-servicing of current clients and poor cash flow for your business.
If you’d like to discuss proper business processes for your agency please get in touch today, we’d love to help.