Flash Report

Why and What

Don’t drive blind

You don’t drive down the street with mud all over your windshield.  If you can’t see ahead you can’t make important, sometimes life-saving, adjustments.  If you can’t see, you can run off the road or hit another car.  

It’s not enough to know that, generally speaking, you’re in Amarillo and headed toward our destination, Florida.  You have to know pretty much second by second what lies in front of you.  Even a second or two makes a big difference.  

A game of inches

Your business is the same.  You can’t wait a few weeks after the end of the month to take stock of what’s happening when your financials are ready. Why?  Because things change every day.

Let’s say your month-end Balance Sheet shows that Accounts Receivable are up from an average of 45 days to 50 days.  It’s now been four weeks. Was it possible to see this coming sooner? Could it have helped your cash flow?  Could it have reduced your borrowings and interest expense? Yes, of course.

When we monitor key indicators on a rapid cycle we can make the many immediate adjustments that add up to big improvements.  Sure your AR person is doing their best. And sure, sometimes they slip or they have a problem with an account and don’t think to ask for help.  How long do you want that to go on before you know about it?  

The same goes for other departments with input and outcome metrics like sales outreach, orders received, jobs completed, personal productivity, inventory, capacity utilization, etc. 

Much of your company’s success will come from making immediate adjustments rather than waiting for weeks or months to take corrective action. Sure there are some big strategic moves a CEO can make but other than that it’s mostly about frequent optimization and correction.  

When we’re driving we don’t yank the steering wheel once every minute. Instead, we make small adjustments on a continuous basis.  In the same way, business is about making frequent adjustments.  To do that we need to see more detail, much sooner.  

Why call it a Flash Report

You might know it as a KPI report although we’ve used the term “Flash Report” with our clients for 35 years.  It reminds us of a “news flash”, something that just happened and is hot off the presses.  Plus “flash” sounds and feels so much more exciting and interesting than KPI.  That said, you can call it what you want. Just pick a name and get everyone using it. 

Include the whole business

To be effective your Flash Report must include information from every area of the business so that you have a window into all the activity and results.  How deep you go, how far down you can see through that window, is up to you. When in doubt, always go more granular at the outset.  Go down 2 or 3 levels of detail at first and then pull back if it’s too much.  Keep in mind that every level is valuable information. Some of the real granular information can remain at the department level slightly higher level information is placed in the all-company flash report for weekly review by the management team.  

For example, the Flash will contain overall Accounts Receivable numbers like total receivables, total new invoices sent, total collections, average AR days, % over 60 days, % over 90 days.   At the department level there will be more account level data and notes describing any recent communications with the customer and next action items. 

Blank spaces are OK at first

The other thing to keep in mind when building your Flash Report is to include what you think is important even if you’re not collecting the information already and even if you don’t necessarily know how to collect it.  If you think it’s important then it deserves to be there and if it takes a few months to start collecting the numbers then so be it.  It’s ok to start with lines or entire sections without numbers. Just gradually begin filling them in.  

Don’t automate the report 

Lastly, don’t be seduced by the idea of delaying the creation of your flash until you can automate it.  Yes, collecting the information at first will take a little time but many people contribute to the report so you’re not bogging one person down too terribly. And it starts going faster after a few weeks. 

Plus, the information is so valuable that the “return” way outweighs the time invested. Please trust us on this.  We’ve been doing this for 35 years and we’ve seen this over and over again. If you wait for IT or someone to automate it you’ll NEVER get it done.  

The starting point for accountability.

One huge reason we’re such fans of the Flash Report is that it creates accountability.  Measure more and, importantly, share the information openly so that everyone can see it.  People don’t want to show bad numbers to the rest of the group.  

Managers play only a small part in holding employees accountable.  Numbers do the heavy lifting and the Flash Report is perhaps the most effective tool a CEO has for this. Why? Because every department contributes to it. And all department managers attend the weekly Flash meeting where the numbers are shared. 

If a department’s numbers are slipping everyone sees it. And no manager, certainly no high performing manager on your “A” team, wants to show bad numbers. That’s where top performance comes from and why people say “What gets measured gets better.”  When we shine the light on a problem so that everyone can see it we invariably do something that fixes it. 

Catch people doing things right

The CEO who heads up the meeting doesn’t have to make a big deal about underperformance.  In fact you should spend more time seeing good things and commenting on them. But when things are going backwards, all you need to do is ask about it.  As in “ So what’s going on with those numbers Joe?”  And 9 times out of ten the manager will beat you to it. They see the numbers and they’ll want to explain what’s happening and what they’re doing about it. 

What to include

So, getting back to the actual report… You want your team to include key indicator information from across their departments.  Although there is no exact rule for what to include, and it depends by company and by department, we usually describe it this way.  Let’s say you’re meeting with a department manager and you ask: “Mary, how are things going?” and she says “Oh, great!” and then you ask “How do you know?”.  Well this is where it gets interesting. Does Mary have a feeling that things are great or does she have the data to back it up?   What numbers are telling her that things are great?  Those numbers are what we transfer to the Flash report.  And, of course, if she doesn’t have enough numbers it’s time to start tracking and generating them. 

Give your business a voice

It’s obvious but we rarely think about it.  Our business talks in numbers and it wants to tell us exactly what’s going on, where to pay attention, and what to do to improve.  But we can’t hear it if it doesn’t have numbers to speak with.  The limited financial and other high level reports we typically generate give us too little information. But the full story is available to us when we generate the right numbers and the Flash Report is a huge first step in that direction.   

Cause and effect

As you build your Flash Report be sure to include not only outcomes but also inputs.  For example, the sales department always reports sales but they should also report on the actions that lead to the results.  That means, for example, tracking the number of emails blasts sent out, or the number of sales calls set up, and the number completed, etc. You get the idea. 

We’re excited for you.  Your Flash Report alone will elevate your business and you as its leader. Please jump in, fill in the worksheet, get it launched and, as always, contact us if you need help.  

Example 1: Steps to Create Your Company’s First Flash Report

examples 2