1. P5.004 WHAT TO SHARE, WHAT TO HOLD - YOUR FINANCIALS - WILLIAM EASTMAN

INTRODUCTION

Very seldom am I impressed by a business book and almost never about 2 books released at the same time. In the mid 1990's as we were building our large corporate consulting practice I read both "the Great Game of Business" and "Open Book Management". 

What made these two texts significant was (1) both were written by CEO's on their methods of growing a business, not consultants, and (2) guidance on how to build variable compensation systems. I now had a tool to educate employees on how to understand the numbers and positively influence their compensation.

Since then I have used these concepts with all of my clients, when appropriate, and it is how we are building the IBGR organization. The following are a few key rules to take advantage of this powerful tool:

• Management By Objectives - the business has a written plan that includes aspirations (initiatives), results (goals), and activities (objectives);
• Training on Business Acumen - routine education of the workforce on how the business performs, makes money, and keeps profits;
• Shared Financials - the books are shared (appropriately) and used daily to run the business;
• Line of Sight - everybody in the organization is responsible for objectives and goals affected by their position
• Personal Scoring - every person is responsible for maintaining their own metrics and sharing the information