“The key learning and ultimately growth of an individual is through analysis or review of activities already undertaken, a practise of significance followed religiously by a majority of successful people”.
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It is this practise that can create an impacting difference in one’s overall finances too. Accumulating data, record keeping is done by a majority chunk of people globally but reviewing or analysing of records for one’s own benefit and purpose is hardly undertaken by a few individuals. It is these people who’re consistently laying a strong foundation base for their overall growth. For example: a majority people have their personal balance sheet in place, their company’s balance sheet in place but how many times does one actually sit back and compare existing balance sheets with previous year’s balance sheets? Not so often.
WHY REVIEW/ANALYSE RECORDS?
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- When you review you gain an opportunity to view the entire process undertaken in your mind in a 3D version from a learner’s perspective, which is looking at the situation in hand with a fresh and a more flexible mind set. This enables one to decode and understand what went right, what didn’t go as planned and how can things be bettered to gain maximum benefit in the future.
- Every achievement or setback would be looked at as an opportunity to learn rather than an end in itself, you’ll be able to focus specifically on bettering the overall process which complements your ultimate vision.
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- It also feeds an individual with motivation and a sense of empowerment.
- It allows one to discover other ways in which a task could’ve been executed more efficiently and effectively.
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For example:
You’ve cracked some amazing deals this year and there’s something unique which you had done in order to crack that deal. Upon reviewing the entire period right from the time the possibility of deal appeared to the time you actually cracked it psychologically, you’ll be able to analyse holistically and conclude key learning from it which could be a game changer in your upcoming deals as well.
The point here is to replay the entire experience psychologically to better understand each aspect that could be leveraged or used to your advantage in the future and to try and copy the best practices that you had built for yourself.
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Let’s take the following case studies:
- Upon reviewing, it was found that Mr. Arhan’s company which deals in manufacturing of biodegradable polymers was facing a decline year on year basis. His company’s business came down from Rs. 12 crores to R. 2 crores. An analysis of key reasons behind such poor performance showed that:
- Most international business opportunities were tolling the highest sale and turnover amount. His company therefore focussed more on acquiring and growing their business internationally. However, in the recent years a wave of manufacturing and promoting domestic products was on the rise in the countries that his company usually gets into business with. Such a wave therefore negatively impacted Mr. Arhan’s business.
- Lot of bad refunds weren’t claimed;
- Lot of pending refunds that had to be followed up with and collected, weren’t claimed; and many more
Such a review immensely helped Mr. Arhan to identify existing gaps in his business and accordingly draft solutions against each problem. It also helped him to convert current challenges into opportunities.
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Few solutions were to start diversifying his business portfolio; to dedicate a team for working on opportunities available in his home country; to dedicate a team for researching on those countries who are currently in developing stage and who don’t have any issues with outsourcing to his home country; to start proposing and find out opportunities for establishing manufacturing base in such countries so that he can serve locally there etc…
- Another common example would be when as a family, you incur a diverse range of expenses such as your child education expenses, household expenses, holiday expenses etc. If no review of such expenses is conducted, then the possibilities of it growing without you realising is high. During such times your hands are almost tied and you feel choked when you need money but don’t have it.The only way to avoid this is to note down various kinds of expenditures that your family undertakes and start budgeting against each expenditure.
For example, last year you’d spent Rs. X on festival gifts for your near and dear ones. Reviewing expenditures will help you analyse if expenditures incurred last year will be incurred this year too and if the money spent last year be sufficient or not for a particular purpose in future too. Therefore this year you’ll be better prepared to execute such expenditures. This’ll ensure that you not only keep your expenditures in check but also find out the leakage from where money is expended wastefully. This can be done yearly, monthly, weekly and daily basis.
Hence a good start for you would be to start preparing your balance sheet and reviewing your previous year’s balance sheet with the current balance sheet. You can later review every type of record may it be your balance sheet or the processes followed in your company or the systems placed in your organisation or whether your current manual works for your maximum benefit or even your overall progress. This can be done on a daily basis, weekly basis, monthly basis and ultimately on a yearly basis too.
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Therefore the whole purpose of reviewing to find out gaps, to identify the old best practises, to get your kick back where you feel more responsible and encouraged to better yourself as you’re driven to keep a self-track on your growth. Increasing your business, your finances manifold is important but what’s more important is to grow in the right manner which can ensure sustainability otherwise you’ll only be building an empire of sand which wouldn’t be able to withstand the slightest turbulence in the market and the practise of reviewing helps you in laying a strong foundation.