I love business books.
Good to Great by Jim Collins, The E-Myth Revisited by Michael Gerber, and even The Effective Executive by Peter Drucker. Classics!
The things that we as entrepreneurs can learn about our businesses from reading others' experiences are unparalleled.
Unfortunately, Business books can only move our journey as entrepreneurs forward by so much.
Most business owners default to running their companies based on intuition and emotion alone. We read a few inspiring passages from the most prominent minds in business and think we've got it all figured out.
What happens when you hit a roadblock that you haven't read about?
What do you do when a problem in your business is unique to you -- to your industry, your staff, and you as the business owner?
What story can you read that will help you improve your business, overcome your unique hurdles, and create the company of your dreams?
It's pretty evident when you think about it: you must read your own story.
Your daily actions in your business create a story as unique as your company: when you make new sales by flexing your marketing muscles or promote your junior staff member to the senior level. You have written another line in your story even by providing a service to your customers.
By reading and understanding the tale of your business, you can see gaps and areas for improvement.
You can hear how your business has grown and start planning for what's next.
You can feel the way forward and see it reflected in your finances.
Money is the Foundation of Your Story
On May 10th, 1965, Warren Buffett first acquired control over Berkshire Hathaway Inc., a struggling New England-based textile maker.
Today, Buffett is best known for identifying troubled companies, purchasing them, and either gutting and selling them for parts or turning them around.
Berkshire Hathaway's value is currently over $645 billion as of 2022.
In 2015, the aging billionaire investor appeared on CNBC's Squawk Box - a morning news program that mainly discusses business and politics before the stock markets are open. During his appearance, Buffett made a seemingly small remark about accounting that has drawn much attention over the past few years:
Accounting is the language of business, and you have to be as comfortable with that as you are with your own native language to really evaluate businesses.
The thing that all businesses have in common - every single company across the globe - is money. Whether you're operating as a solopreneur, a team of five, or even a Fortune 500 company, everything that happens in your business is reflected financially.
Both your struggles and your successes.
The problems that all businesses face boil down to how effectively you use your money, how much you make, and how much you keep. Simultaneously, the massive wins you experience in your business are also financially reflected, whether as an excess of cash or in the effective use of it.
Accounting is a language: it translates all actions, good and bad, into useful information.
When correctly implemented, it converts your intuitive feelings about your business into insightful data.
Understanding this critical concept and pairing it with your current understanding of your business allows you to build the company of your dreams.
You can navigate uncertain situations and recover quickly from economic events.
You can find confidence in your business.
Reading Your Financial Story
If you're with me so far, you understand your financial story can change the trajectory of your business for the better by equipping you with a deeper understanding.
You realize that everything happening inside your company has a monetary impact and that the only way to read and understand your unique story is by understanding the accounting language.
Unfortunately, accountants teach in a way only other accountants and robots can understand.
Are you out of luck if your brain doesn't work like an accountant or robot (which are not always mutually exclusive)?
You just need to approach accounting from a real-life, human-first perspective for everything to click into place.
However, maintaining, understanding, and predicting the performance of your business requires excellent and timely recordkeeping. While every business owner can deeply understand the story of their business, not every owner is meant to be a financial storyteller.
Instead, you need to work with a team of accountants, bookkeepers, and tax advisors to develop goals and strategies for the direction you want your business to go in.
Once you've found the right partner to help you write your financial story, the entire world opens up.
Your business becomes far less stressful and a lot more successful.
You no longer feel alone in growing your business or confused about what to do next.
You'll find clarity and confidence.
Whatever your story has been so far, we're here to help you write the next chapter.