This time of year, many people are thinking of summer vacation plans; however, most CEO’s I know are thinking about their business. Specifically, they are thinking about the fact that this year is almost half way GONE! That said, CEO’s are an optimist bunch and quickly realize there is still half of the year LEFT to make 2015 GREAT. Here are 4 things CEO’s should be addressing now to ensure 2015 is a success!
The following are important to consider when performing your mid-year assessment.
1. Protect your ASSets: For many organizations, the first part of 2015 has been strong. Now it’s time to protect your assets and bottom line, while reducing risk. For many Business Owners, it is truly easier to make money than to keep it. Protecting what you have made is critical to preserving the longevity of the organization. Investments in the organization are necessary to fuel continued growth and evolution; however, these should be carefully calculated strategies with an intended return and a ‘what if’ analysis. You should have a financial ceiling – the most financial exposure you are willing to tolerate before altering your course, should the investment not go according to plan. In addition, every company should have a risk management and risk mitigation plan which identifies the potential threats to the organization and outlines the processes, procedures and tactical steps taken, to mitigate these risk.
2. Improve inefficiencies: When times are tough, most people realize the importance of streamlining processes, reducing unnecessary expenditures, and cutting the proverbial fat. However, when times are good, these strategies are of equal importance. Every dollar that can be dropped to the bottom line is simply more you will have to invest in other strategic initiatives, increase shareholder value, and/or pay your team for their contributions to success. Too many companies ignore this fact during good times, because it is easier to overlook or deny these inefficiencies in a time of increasing revenues.
3. Evaluate opportunities: There is still time left in 2015 to implement and execute strategies for growth of the organization. These opportunities need to be carefully vetted by your Executive Management team, Board of Directors, and Chief Financial Officer. Projecting not only the net income or ROI, but also the cash flow and tax implications. This practice is necessary to ensure the long term success of the venture.
4. Recasting projections: For 99% of companies, the first part of the year wasn’t exactly what was projected and that trend of uncertainty will likely continue for the rest of 2015. Therefore, recasting projections for the remainder of 2015 is critical to ensure you are able to achieve the goal of EBITDA, net income, and increased enterprise value.
At CFO Strategic Partners, it’s more than the numbers. We work intimately with our client CEO’s to help ensure all of the above are thoughtfully considered. In addition, we monitor performance and make modifications early and often, to stay on course. As you consider your mid-year evaluations and assessments, what changes do you need to make to protect your assets and maximize your bottom line for 2015?
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