Growth is not the same as profit.
That’s a hard business lesson many small and mid-size business leaders learn. Developing a company that focuses on profitability take a concentrated effort. Some leaders, like the executives at Tasty Catering, have found it’s made easier through open-book management and the Great Game of Business. Learn more from this short video.
Watch this video with your senior leadership team, then use the questions below to launch a discussion on how to incorporate open-book principles in your financial management.
Using the principles of open-book management, Tasty Catering’s leaders taught team members to understand financials and take ownership for different aspects of the business. As a result, employees at all levels feel more secure in their financial futures, and that of the business. Equally important, the company’s profitability has increased at exponential rates.
Discuss open-book management and the video with your team:
- Take a hard look at the numbers: does your company’s growth represent a true increase in profitability? If not, work as a leadership team to identify areas where profitability is lagging behind growth. What are the indicators of disparity? How can your tackle this difference?
- Now think about your team members, especially those outside of leadership positions. Do they know the company’s financial standing? Do they feel ownership for expenses and income? What would it take for your team members to become fluent in the company’s financials? What advantages to do you see in this?
- One aspect of open-book management is the use of “games” to challenge team members to reach certain measurable goals. Review your earlier discussion on profitability: are there areas where a reduction in cost would make an scalable difference in your bottom line? How could you design a team-based “game” to tackle the challenge?
Share your stories: Does your team use the Great Game of Business and open-book management? Share your stories here.