In today’s data-driven world, management information (MI) is no longer a nice-to-have; it is a must-have.

It is the lifeblood of any organisation, providing crucial insights that should drive your decision-making and strategic planning.

We all have to prepare annual accounts; but this information will be largely ancient history by the time it is completed, and therefore pretty useless in any strategic sense.

Most businesses prepare their MI every month. (It is quite acceptable to do so quarterly or even 6-monthly – IF you are not making that many big decisions or the business model is not that complex.)

To understand just what your MI could achieve, consider this:

All too often the MI that we see when we first get involved is very basic, some might say boring – just rear-view mirror stuff and simply telling you what has happened.

This can be fine. But if things are not quite going to plan then the MI will raise more questions than it answers.

Far better, surely, for the MI to have already identified any underperformance, to give an idea of the financial implications of doing nothing and what steps are being (or will be) taken to remedy that underperformance.

This level of reporting is a step closer to what we at Tectona call “Actionable Insights” or Nirvana

The Actionable Insights are the story telling – what has happened, what will happen if we do nothing, options to remedy and what is being or will be done and the financial implications.

But what should you, as a business leader, expect from your MI?

Accuracy and Reliability: All the relevant reconciliations and sanity checks need to be carried out before the first draft accounts are run off.
- Data Integrity: Ensure that the data underpinning your MI is accurate, complete, and free from errors.
- Timeliness: Receive your MI reports promptly, allowing for timely analysis and decision-making. With modern apps there is no reason why that should not be within a week of month end.
- Realistic: Make sure you post any material period end journals (for example, rent prepayments or providing for accountancy fees) together with matching costs with sales income to give a fair and realistic performance picture.
Clarity and Understandability:
- User-Friendly Format: Present your MI in a clear and concise format, easy to understand for all stakeholders.
- Visualisations: Use charts, graphs, and other visual aids to enhance understanding and the data should be easy to digest.
- Narrative Analysis: Provide a narrative to explain the key findings and insights from your MI and what is being done to address underperformance.
Relevance and Actionability:
- Business Alignment: Ensure that your MI directly supports your organization’s strategic goals and operational objectives.
- Key Performance Indicators (KPIs): Focus on the KPIs that truly matter to your business and provide actionable insights. The tip here is ‘the fewer the better’.

By being given regular and insightful MI, you will be in a far better position to make informed decisions, improve operational efficiency and drive your business forward.

Remember, effective MI is not just about the data; it is about the insights it delivers.

Now is the time of year you should be getting on top of this stuff; and if you need us to help show you the way, contact Tectona.

About Tectona

Tectona Partnership helps business owners sleep at night by embedding one of our 17 commercially minded FD/CFOs in your management team.

Very often, a part time (or fractional) FD/CFO is the most effective solution.

We make sure you have the necessary management information and strategic insight to make informed decisions and reduce risk; and we will absolutely tell you what you need to know, when you need to know it.

“TECTONA PART TIME FDS SUCCEED WHERE OTHERS … DON’T.”
Have a read of one of our case studies here