As we all know, when it comes to reporting in your business it can often be a minefield when it comes to deciding which data of the vast amounts available needs to be included within your reporting. This is why, in our latest blog article, we are going to provide 3 ways to make sure that your business reporting stays on track.
1) Focus on what really matters to your business
The best place to start is to reflect on what really keeps moving your business in the right direction. For most businesses, you will discover that there might be around 3 or 5 assets/resources which enable you to keep a competitive advantage in the market you operate in. It goes without saying that these assets won't be the same for every business as some may focus on the brand or on their customer base. In most cases, these sorts of assets are rarely represented in the balance sheet which you would kind of come to expect. Consequently, you will find that their importance to the day to day running of your business are not reflected in any financial reporting.
It is important to note however that these assets are vital in helping to drive the business forwards. Being able to enhance these is vital in protecting the long-term value of the business. Therefore, it is vital that they are reported on so that the value added by the management as well as the long-term future of the future can be fully comprehended.
The best way to describe these assets is to explain what they are, why they mean so much to the business and whether they are future proof. With this basic understanding in place, stakeholders will want to know how these assets work with the ever-changing needs of the business and the market in which it operates. Furthermore, it will be important to be able to demonstrate how these assets have been adapted to meet the ever-changing requirements.
2) Think from an operations point of view
What does success look like for your business? It is likely to go far beyond just profitability. Some of the focus is likely to be on whether the overall business strategy has been implemented as well as the development of your core assets as well as your approach to managing risks. Stakeholders will need to be able to have a firm understanding of these factors to enable them to evaluate performance that takes into account both the long and short term values.
This part of the assessment will require you to delve deeper and look beyond the pure financial measures of the business. These measures will need to highlight the fact that they align with those that the senior management use to review performance.
As mentioned above, it is important to note that not all businesses will have the same measures. Selecting the most important and relevant one for reviewing overall performance needs careful consideration. The things to be careful of are getting the balance right as having too much information can be overwhelming and having too little information can show a lack of detail.
3) Guide stakeholders towards the future
If you want stakeholders to look to the future on business value, you will need to give them just enough information to help guide that view, however many businesses are reluctant to look to the future. Largely down to the fact that there are no guarantees that these predictions will come true.
The best way to steer stakeholders in the right direction is to give them all the information they require to allow them to come to informed decision themselves. This requires businesses to ensure that stakeholders understand the factors that will help to drive future growth and helping them to understand how several factors can be impacted. This is already evident in risk reporting however this tends to focus on the negatives rather than providing a more balanced view.
Stakeholders will also need to develop a balanced understanding of how the factors above will impact on the profitability of the business going forwards.
Next Steps?
If you are a business that is looking for a comprehensive reporting solution that will allow you to present data effectively and accurately then please get in touch with our experts today to discuss your specific requirements.
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