A recent article published in the Harvard Business Review: ‘Are You Financially Literate’ revealed that a representative sample of business owners and managers scored an average of 38% in a test that any junior finance person should ace. The article goes on to highlight that “the majority were unable to distinguish profit from cash. Many didn’t know the difference between an income statement and a Balance Sheet. Nearly two-thirds thought that discounts offered by sales reps had no effect on gross margin.” When asked what happens in meetings when people don’t understand financial data, most participants admitted that they don’t ask for clarification because they don’t want to appear stupid or uninformed.

The Harvard article concludes that financial illiteracy in the managerial ranks is a crippling weakness for many organizations; and that those who can’t speak the language of business can’t contribute much to a discussion on performance… “and if you don’t understand what goes into a number, you can hardly know how to set about improving it.” Harvard Business Review; October 2009.

Unfortunately, research undertaken by CPA Australia confirms that similar deficiencies exist here in Australia. Their research shows that Australian entrepreneurs are all-too-often not comfortable with managing the financial aspects of their operations; and, frequently, do not maintain or analyse data or use it to improve performance or build value within their businesses. Inevitably, this can lead to poor and eroding levels of profitability, unnecessarily high working capital requirements and businesses of little real worth.

The Financial Dynamics approach was developed specifically to address the problem of ‘financial illiteracy’ within smaller businesses by devising a set of intuitive techniques that are: simple to understand; easy to implement and maintain; and provide clear insights into ways to implement changes that will lead to immediate and sustainable business improvement. The techniques were first outlined in the book: ‘The Genghis Khan Guide to Business… Dynamic Benchmarking’ written by Brian Warnes. Since the publication of this book, the techniques have been developed extensively by Brian Warnes, Tim Atterton and Geoff Potts (the ‘Dynamics’ team); and delivered to highly enthusiastic business owners and managers all over the world.

What You Will Learn:

• Analyse your current operations with a view to improving financial performance and increasing return on investment and your own personal ‘sweat equity’
• Use financial information for strategic planning, business improvement and decision-making purposes
• Improve profitability
• Understand and build a stronger Balance Sheet
• Manage cash-flow more effectively
• Identify and control working capital requirements; especially within cash hungry growing businesses
• Appreciate the real funding requirements of your businesses and calculate true borrowing needs
• Identify and monitor key financial performance indicators that are relevant to your businesses
• Understand the concept and critical importance of controlled, incremental growth; and
• Appreciate the fundamentals of business valuation, and actions required to build value and true net worth within your business.

PRESENTER

The Financial Workshop Series in Australia is delivered exclusively by Tim Atterton, one of the original pioneers of the approach. Tim is regarded as one of the top speakers on entrepreneurship and business transformation in Australia; and has an international reputation in this area.

Please direct any queries to Tracey Staltari on 9240 6337

Have a nice day!

Evan McRae
CEO