“My accountant handles that.”
Four words. I hear them almost every time I ask a founder about their margins.
And they’re not wrong. Their accountant does handle it. Cash flow, P&L, tax, year end numbers. All covered.
But that’s financial profitability. It tells you whether the business made money last year. It doesn’t tell you whether the project you finished last Tuesday made money. Or whether that client you’ve had for two years is actually costing you more than they’re paying you.
That’s operational profitability. And almost nobody’s tracking it.
Mainly because they didn’t know there was a difference.
I wrote about this in the latest issue of Optimise Your Operations.