How the right financial insight can spell success for your businessEmma
“Whatever you can do, or dream you can do, begin it. Boldness has genius, power, and magic in it.” – Johann Wolfgang von Goethe, writer
Every business, including the one you work for or may have started, began with a dream. Someone, somewhere had an idea they thought was so good that they began to implement it. Some of these dreams have become remarkable financial successes; burgeoning businesses that have changed the landscape of South African commerce. Others have floundered and eventually closed. What is the difference between the two? Circumstance and timing play a role, but another crucial factor is financial insight.
Insight is the capacity to gain an accurate and deep understanding of something. Financial insight, then, is possessed by those who can accurately assess the financial environment of a company, predict future situational and competitive factors that will affect the company’s bottom line, and determine how best to use financial resources to maximize profits rather than see them stagnate or dwindle. Take a look at every Fortune 500 company in existence and you’ll see the realization of a strategy that was powered by true financial insight.
One great object lesson comes in the form of an unlikely success. Smashburger, an American “fast casual” restaurant, was founded in 2007. It started up just as the country was starting to feel the effects of the recession. Many fast food companies took a knock and restaurants began to close down as American consumers felt the pinch. Despite this, Smashburger grew from strength to strength. In fact, it claims the title of the fastest three-year start for a restaurant company, thanks to its meteoric growth between 2007 and 2010.
The concept behind Smashburger places it somewhere between restaurant eating and fast food. It offers a dine-in experience and “handcrafted” burgers, fries, sandwiches and salads to patrons who, at the height of the recession, were increasingly price sensitive.
“It was a time when guests were buckling their belts, paying closer attention to their budgets and seeking more value from restaurant options. This was how the fast casual movement was born,” Scott Crane, chief executive of the company said in one interview with Forbes.
“Real estate was more affordable during this time, so we were able to take advantage of better economics and key locations we would not have been able to access to prior to the recession given the newness of our brand and lack of a national or regional presence.”
Smashburger pulled in $228-million of revenue last year, leveraging off the difficulties of tight economic circumstances. The resounding success of this burger joint boils down to one thing: great financial insight.
So how can you ensure that your business’s financial insight generates that same level of excellence? The answer lies in filling key strategic positions in the company with the right people. Look for a few defining traits when shopping for senior financial executives:
- Passion: Someone who keeps their eye on the clock and their focus on the leave calendar won’t have the interest or time to gain the true insight that will give your company a competitive edge. You need someone who is genuinely interested in what your company does, and immerses themselves in your way of doing business
- Relevant qualifications: Smashburger’s founder, Tom Ryan, has a PhD in flavor and fragrance chemistry. If you think he had an advantage over a commerce graduate when it came to developing tastes that would win over the American public, you’d be right.
Similarly, your senior financial staff members need the qualifications that prove they can understand the factors that make for true financial insight. A few others may have the gift without the qualification, but the paper proves it.
- Experience, experience, experience: There’s a reason listed companies rarely elect senior officers who haven’t already spent years in the industry. Nothing can replace good old fashioned “been there done that” experience. It sharpens a person’s ability to identify possible pitfalls and hurdles in the road ahead. It also means a person is more likely to recognize opportunities that they may have encountered – or even missed – before. Younger employees, no matter how skilled, can only benefit from the financial insight offered by more seasoned practitioners.
If you’re wondering where to find this kind of employee – one who is most likely to provide the kind of financial insight that brings excellence to your business – The Finance Team could have the solution
Our associates are handpicked for personality, qualification and experience. They can provide quality, astute assistance to your business on a part-time or ad hoc basis. Their service is designed to suit the needs of your company as well as its bottom line.
Image credit: business.financialpost.com