With instant access to seemingly endless amounts of data at your fingertips, it’s tempting to think that you can answer any question or solve any problem with the click of a mouse. Questions? Maybe. But solutions may be another thing. Most difficult problem solving requires more than access to data. It requires knowing what questions to ask of the data, and better yet, what to do with that data.
When we were building the famous Barefoot Wine brand, we had an accountant who kept telling us that we needed to learn how to read a set of financial books. The immediate requirements for survival of the business forced us to ask him to prepare new and parallel reports based on those same books with a few key pieces of data thrown in from the outside. We called it “The Box Score.” Today it’s called a dashboard or key metrics. We basically said, “Here’s what we need to see monthly to pay our bills on time and keep our credit rating.” Then, when we got a little bit ahead, we said, “Here’s what we need to see to grow our business.”
Raw data in a set of books or general journal is really a rear-view mirror view of your business. It’s a history of where you’ve been, not where you are going. Knowing what questions to ask of the data doesn’t come from the data, or even knowing the language of accounting.
What you really need to drive your business and navigate the curves and hazards is the windshield and the dashboard! It’s always great to know where you’ve been. It can keep you from repeating costly mistakes and give you a reality check. But when it comes to navigation, if you rely on the rear-view mirror approach, the road may look rosy until you suddenly realize that the cliff is receding behind you at an alarming clip. Then it’s too late! So look out the windshield and check your dashboard.
You need a dashboard so you will know, among other things, how far you can go before you run out of money. We didn’t know it at the time, but we were basically “hacking” into our own general journal to get the critical information we needed to run the business, in a format we could understand, based on our experience and what we saw coming. We didn’t learn how to properly read a set of books for years, but we did have the right numbers, metrics, and records to make daily calls on key decisions.
Don’t get too comfortable just because you have an accountant. Think about what you want to see and demand it on a regular basis. Call it the executive summary or the dashboard or even the box score. Once you start this practice you will keep discovering more information you need. In fact, it’s the only way to truly understand your business and to react fast enough to what’s coming your way.
The key to knowing what questions to ask of the data is knowing what is the most important, most pressing and essential first, then building on that firm foundation. Most of that knowledge comes from the street, not necessarily the keyboard or the mouse. Getting out there and actually doing the work, no matter how badly you stumble at first, is a true education in priorities and one that will guide you much better than knowing how to read a set of books.
Who We Are
Michael Houlihan and Bonnie Harvey co-authored the New York Times bestselling business book, The Barefoot Spirit: How Hardship, Hustle, and Heart Built America’s #1 Wine Brand. The book has been selected as recommended reading in the CEO Library for CEO Forum, the C-Suite Book Club, and numerous university classes on business and entrepreneurship. It chronicles their humble beginnings from the laundry room of a rented Sonoma County farmhouse to the board room of E&J Gallo, who ultimately acquired their brand and engaged them as brand consultants. Barefoot is now the world’s largest wine brand.
Beginning with virtually no money and no wine industry experience, they employed innovative ideas to overcome obstacles, create new markets and forge strategic alliances. They pioneered Worthy Cause Marketing and performance-based compensation. They built an internationally bestselling brand and received their industry’s “Hot Brand” award for several consecutive years.
They offer their Guiding Principles for Success (GPS) & Shelf Smarts courses to help consumer product brand builders achieve success. Their book, The Entrepreneurial Culture: 23 Ways To Engage and Empower Your People, helps corporations maximize the value of their human resources.
Currently they travel the world leading workshops, trainings, & keynoting at business schools, corporations, conferences. They are regular media guests and contributors to international publications and professional journals. They are C-Suite Network Advisors & Contributing Editors. Visit their popular business site at www.thebarefootspirit.com.
To make inquiries for keynote speaking, trainings or consulting, please contact email@example.com.