Business Analysis: The Basics Are Still Key to Growth

Whether you own a small business or a medium-size business, setting appropriate goals for your company isn’t always easy. Financial analysis can provide a window into your business’s ability to achieve these goals. How do companies establish short-term goals that facilitate long-term goals with financial accountability?

Strategy Analysis

External business environment and internal capability are two key areas that businesses examine to increase effective goal development. Defining the tactics that will help a business implement strategies is a cyclical process. New growth creates new strategies, and new profits speak volumes. As growth continues, so does strategy analysis. Are project management tactics currently delivering? Does the company possess the internal capability and capital to make use of these tactics in a way that is conducive to growth? This can take a company-wide collaborative examination.

Strategy Definition and Implementation

Now that the big questions have been asked, it’s best to synthesize what was learned from collaborative examination of data. Realignment of values due to changes in business structure are a challenge that many businesses come up against at this stage. New growth equals needed financial resources. Many entrepreneurs do not have the time to research all the options that are out there for them. After defining a financially viable and structurally efficient plan, risks of implementation can now be examined.

The design of a new system which works off of gathered data is going to be invaluable to meeting benchmarks with little pain and loss along the way. Risk analysis can help companies understand obstacles to strategy implementation, and other issues that must be dealt with before a system “goes live.” It is after arriving at this step that performance measurements are put in place to ensure a consistent set of steps are being taken to achieve company goals. Budgeting is key part of this step, and a keen eye for overlooked expenses can make or break efficient strategy implementation.  Financial metrics are a viable part of any company’s analysis tool set.  Do not let lack of capital set you back unnecessarily and affect your competitive edge:  Analyze it!

Remember, running a business successfully does not need to be complicated.  Keep it simple!

For more information on business analysis, business planning, and ways to grow your small business profitably, please check out our website www.portalcfo.com.  Follow us on Twitter @portalcfo

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