Lots (and lots) is being said these days about building a great business with a great culture. Although that is true, and I am probably leading the way in that conversation, I wanted to take a moment to remind us all that we also need to keep an eye on cashflow.
I have heard of, and have seen first hand myself, organizations that grow and speed themselves into bankruptcy by not paying attention to cashflow.
I have talked before about the four things that leaders need, to have a balanced approach to when leading a business or a team. I call them the Three Up’s and One Down. As a reminder, they stand for a leader’s responsibility to grow Revenue, Engagement and Customer Satisfaction (the Three Up’s) and control Costs (the One Down).
It is the cash part of keeping costs under control that this blog is about.
You just stop spending on anything that doesn’t generate revenue. The Managing Cashflow part of Costs is harder. It requires leaders to pay attention to keeping Engagement levels high by not cutting training and developing budgets. It requires smart investment in R&D. It requires continued focus on the businesses strategic differentiator (like Quality, Innovation or Customer Intimacy). So how do leaders do all of this? Well to keep it really simple, I recommend the following:
Sounds easy right? Remember to approach cash with a balanced view so that you do not upset the Three Up’s.
Robert Murray is a Vancouver, BC based Business Strategy Consultant, #1 Best Selling Author, International Keynote Speaker, and TEC Top Speaker of the Year for 2018. For further advice, insight and inspiration on how to unlock your inner leader, connect with Robert on LinkedIn.
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