The 8020 Input
The 8020 Finance Director was introduced in September 2000 by an existing client of 8020. The fact that the introduction was from a trusted source, meant a great deal to the four directors, at the time.
There were a number of issues that were concerning the Company specifically as follows:-
- They had just parted company with their Finance Director who had been one in a succession of bookkeepers and accountants working for the Company
- They did not feel in control of the day to day finances
- The Bank was requiring clarification of the financial position of the business
- There was a lack of coherent and regular management information
- The remaining Directors were frustrated by lack of finance to invest in the infrastructure and staff resource of the Company….opportunities to grow were being lost
- They wanted a finance expert working at the heart of the business.
What happened next?
The 8020 Finance Director set a clear action plan to pull together the accounting records into Sage Line 50®. Once the financial data became available the Directors and management team created their business plan which was then integrated with the financial forecasts. Clear areas of responsibility were defined and the business took its first steps on its new missions.
The 8020 Solutions
Our experience continually reminds us that, to be really effective, our solutions must be matched by the owners and managers with a willingness, energy and enthusiasm to make the business a success. This existed in volumes at IODA and our solutions were quickly embraced for the maximum benefits. Specifically:-
- The accounting records were transferred to Sage Line 50® allowing the data to be analysed and reported.
- A report and proposal was prepared for the Bank and our requests for substantial new funding levels were agreed.
- The new Business Plan was a substantial document and we involved Grant Thornton Accountants’ business advisors for some specialist support.
- An ongoing monthly reporting function was developed including some crucial new Key Performance Indicators “KPI’s”
As the months progressed and the 8020 Finance Director became closer to the workings of the Company we undertook further initiatives
- The Bookkeeping function was fully outsourced to 8020
- A full budgeting and forecasting programme took place with a robust financial model of the business being created. Budgets are devolved to key individuals with their performance closely monitored.
- Monthly financial management meetings take place routinely
- A full review of the previous 3 years VAT returns were undertaken resulting in substantial reclaims of VAT.
The Results of Working with 8020
The 8020 Finance Director has worked with this client since September 2000. The business moved forwards rapidly in the early years and during that time two of the Directors were able to exit their shareholdings with great success without damaging the finance and well being of the Company. It was only with careful planning and advice that this was achieved. The business continued to blossom and today we see a very dynamic management team pushing ahead on all fronts. 8020 was particularly pleased to see the following:-
- Replacing the Finance Director and the bookkeeper has saved IODA ￡60,000 pa. Over 9 years that equates to ￡540,000.
- The VAT reclaim was in excess of ￡11,000.
- The remaining Directors now focus on the business…the STRESS of the finances has gone!
- The wider involvement of key personnel in the budgets has devolved accountability and responsibility. The staff have flourished in this environment
- We continually run the ‘what-if’ scenarios and test our assumptions for the future.
- We all feel very ‘Prepared’ for whatever the future holds