Steve Jobs said, “Deciding what not to do is as important as deciding what to do.” We’ve been doing 2017 review with our clients. We find that successful people share one thing in common — Simplicity. Curious about how simplicity affects your business and leads you to profitability? Let’s jump right in!
Topic: How Simplicity Can Lead You to Profitability
[00:10] The most profitable company that Michael come across are the ones simplest. We’re doing 2017 year-end review with our clients. We spend time with our clients seeing what works & what doesn’t work in the past year. And we find those successful companies are super simple.
What is simplicity?
[00:58] The definition from Cambridge Dictionary, simplicity is the fact that something is ordinary, traditional, or natural, and not complicated. From a business perspective, it means there’s not a lot of moving part, channels, or exception.
Simplicity v.s Complicated
[01:02] A simple organizational structure which is set up very simply, there’s only one or two ways to make money, and same operations or process. With a high degree of specialization, the company is easily scalable.
[01:12] On the contrary, if you’re running a complicated business, each additional account, channel, exceptions are adding up the admin cost $$$ which make your business hard to operate. It also makes business owners hard to identify the issues.
Other — How to Simplify Accounting
TL;DR: It’s not surprising that people tend to perform better when they know what they want to achieve. To simplify your accounting, we’d suggest you find out your top line goals and work back down to the items on your report. Also, only choose 3 to 5 key metrics which measure the performance and make changes if necessary.
TL;DR: Chart of accounts is the backbone of your entire accounting infrastructure. An over-complicated and or too generic charts of accounts add zero values for your business. Check this article for 3 easy steps to keep the structure clean, lean, and mean.