Simplifying Finance: Building Your Financial Workflow & Breaking Out of QuickBooks' Web of Control
This series, my first blog series, is focused on simplifying finance for you and your small business.
Many small businesses today are struggling just to get their finances flowing into some kind of accounting software, much less having good financial processes that run like clockwork.
In this series, I have 3 outcomes for you:
A better, simpler financial workflow for your small business
A clear cash flow strategy
A winning debt reduction strategy
If you put these 3 outcomes together, you'll find yourself with a solid plan for your business finances.
In order to get there, it's going to take not just knowledge but a new way of thinking.
I'm going to challenge some beliefs and some of the ways you're doing things now.
However, if you stick with this, you'll be well on your way to being in a new place with your business finances.
Let's get started!
Step 1: A better, simpler financial workflow for your small business
Just the concept of a financial workflow might be new to you.
A financial workflow is something that really does exist in every business, but it's typically in the owner's head, the head of the bookkeeper, the person that pays bills, works on the books, etc.
It's typically documented in some long-forgotten SOP, but it does exist.
Your first assignment is to grab a piece of paper and create something like this.
This is an example of a few areas from one of my clients:
Workflow 1: The Bookkeeping Workflow
Bookkeeping Workflow
You want to write out in just a few steps your workflow for bookkeeping. Think about the following:
who is your bookkeeper?
how often are the books being accessed?
if you don't have accounting software or a bookkeeper, when can you make this happen?
who is alerted if a strange charge hits your bank or credit card account?
You want to have this documented somewhere. A workflow tool I'm showing here (I use Vani) or even a Google doc written out with steps.
What you want to do is capture what you are doing now. Basically how each piece of your workflow works now. You can improve it later on. The point is just to get onto paper how things work today.
Here's another example:
Workflow 5: The Review (Analysis) Workflow
Now, you'll repeat the same workflow, but this time for the Review (or analysis) step. This one is sometimes non-existent in a small business. If it's nowhere to be found in yours, it's ok!
This is THE most important workflow because it captures when your accounting is completed each month, who is responsible, when the books are reviwed and what changes or improvements we'll make each month based on what we see.
This is the KEY workflow that we'll build on for subsequent blog posts and YouTube videos. You simply CANNOT skip designing this workflow if you want to understand your business finances and create a simpler business using them.
The remaining workflows (workflow 2-4) you'll want to complete this exercise for:
Workflow 2: Invoicing / How You Capture Sales
Workflow 3: Bill Payment / How You Receive & Pay Bills
Workflow 4: Payroll / How You Pay Contractors & Employees
I'm excited to hear what you learn about your business by developing these workflows!
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