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Perspective on money

Managing Money

2 min read

Like it or not, money is a subject that seems to be ever-present in the mind of the business owner. We talk about it, we think about it, we worry about it. We plan for what we'll do when we have plenty of it, and we reveal our fears, frustrations, and resourcefulness when we don't have enough of it.

Why is it then, with all this energy around money, so few of us ever seem to have it really handled? What is it about money that is so elusive, so complicated, so difficult to control?

All you need is a commitment to two simple things:

  • Understanding the relationship between money and your business activities
  • Creating and implementing, on a regular, on-going basis, a few money management tools and strategies.

Your business is more than a money machine

Some people view business in purely financial terms: business is nothing more than a way to create money. Everything else is superfluous. This approach can work, but it's a very limiting way of doing business. It squeezes the joy out of being a business owner.
Some people are intimidated by the financial side of business and, therefore, avoid financial management. As long as the bills get paid, I don't worry about finances, is their casual disclaimer. This approach may work temporarily, but is also limiting because it ignores the potential that lies within the business and there is no ealry detection system for financil problems.

Each view by itself is shortsighted. Both approaches leave something of value out of the business equation. And both diminish the chances of achieving your Strategic Objective.

Business is about making your life better, not merely paying the bills. The financial view of your business as long as it's not your only view is an essential element of your management arsenal. The pursuit of money, when balanced with the other aspects of your life on the way to achieving your Primary Aim, is appropriate and should be one of your most important business objectives. In other words, always keep in mind that a successful business is one that fuels the path toward your Primary Aim. And the financial strength of your business is a key component to its success.

Money in your business is value, fuel and quantification

The value of any business is measured in monetary terms. That's not to say the only value of your business is its monetary value intangibles such as personal satisfaction, contribution to society, and relationships in the community all add to the perception of your business' value but the primary measure of the value of your business is its monetary value.

Money is the indispensable fuel that powers your business. Everything your business does either uses or generates money in one form or another. If over the long haul your business uses more money than it generates, then you don't have a business at all at least not for long.

The EMyth Point of View tells us that quantification is essential for business owners to know what results their businesses are producing. Understanding the monetary impact of what your business does is one of the best methods of quantification at your disposal. Since almost everything your business does directly or indirectly involves money, your business is already quantifying itself for you. To achieve control you have to capture the financial information, make sense of it, and use it to manage your business.

EMyth Team

Written by EMyth Team

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