In considering the link between business success and the human factor, consider that the varied team members you have in your business are accountable for their specific roles, and understand that the cohesion of these members within their teams is critical. Success should be a given when all of staff are working together in synergy aligned to the business plan, shouldn’t it?
Sporting teams are a perfect example. The win at the final hooter is a combination of each member of the team doing their role successfully as directed by their leader or coach. If players in the team fail to follow the game plan, their chance of winning significantly decreases.
When we talk about business success, cash flow is king. Without cash flow, businesses can’t operate. So when we look at that link again, how does your team impact cash flow?
Let’s analyse a typical business operation as an example. The team in the accounts department is not really motivated to make phone calls to outstanding debtors because, let’s face it, it’s a thankless job. No one is ever happy when the credit department calls, so they put it off and rather than call, they send a letter as this is less confronting for them, but it isn’t part of the debtor policy you put in place.
So we have one sector of the team already not following the rule book.
Then consider how the sales team complete their daily duties. Imagine there is no supervisor in their department overseeing them. As a result, the team is busy and focused on generating sales to meet their targets, not the administration or paperwork associated with the sale, not even the collection of the money from the sale.
As a consequence, the paperwork is incomplete. The team does not get adequate details from the customer and the sale ends up in the accounts department who can’t invoice it because it’s missing information. Back it goes to sales to follow up.
More delays and players not following the rule book, and all of a sudden our debtor days are starting to pile up and the money is slower and slower to come in the door.
Our receptionist plays a role in this scenario as well. She has been given the invoices from the accounts team but she gets caught up on the phone. Then five o’clock rolls around and she leaves for the day without sending the mail because she just didn’t have time, missed the post and didn’t realise the importance of the invoices that are piled up in the outward mail box.
Sadly you aren’t going to succeed in business with a team playing their own game to their own strategy. The impact or flow-on effect of all these little things colliding is the slow movement of your cash flow. This makes it very difficult to continue to run your business smoothly and can hinder growth. We have only looked at one small scenario, but this can be happening in multiples through various divisions of your business on a daily basis.
You can now start to see how human resources ties in with business success and how people can impact cash flow.
Michalle
