- Liquidität
PLANNING improves PERFORMANCE
If you align your plan with your priorities, you automatically create an action plan. This can be very useful, especially if you review your plan regularly, but at least monthly. Liquidity and cash flow serve as very good indicators here. As in a well-tuned Formula 1 car, planning and review therefore lead to better performance for your company.
What a plan is for
Your plan serves you
- as an indicator of how expenditure and income develop, which after all is the result of all your business activities,
- as support for decisions by providing information and
- as a means of monitoring and controlling your company.
Internal benchmarking
Comparing your plan with the previous year’s figures can be an excellent method for assessing your company’s performance. And what better way is there to measure performance in a company than by the liquidity available? What has changed? What is different from last year? These are just examples of the questions that internal benchmarking can answer.
Key performance indicators
To increase your company’s performance, you should understand and monitor its most important “drivers”. A driver is a significant factor influencing your company. There are many factors that affect the performance of every business. It is therefore important to concentrate on a handful of them and monitor these carefully.
The three main drivers for most companies are:
- Revenue
- Costs
- (Working) capital
Analysing the differences between your actual and your planned cash flow or liquidity in particular allows you to draw important conclusions about the effects of your business activities. These analyses can help you to identify problems early, provided they are derived from consistent cash flow planning.
Credits: Photo by Jürgen Faè