There’s less room for error when spending money in a small business. You don’t have the same access to capital and resources as a big business. You know this because you’re the one paying the bills and creating revenue streams. But does your team?
How can you encourage them to steward money better? What example do you set for the team? When your team is part of the planning and budgeting process for projects, it encourages ownership and responsibility.
Client Projects
- Are we mindful of the time spent on a project?
- Are we prompt or do we procrastinate?
- Do we rush through and make mistakes? Or are we deliberate with our work?
- Do we recreate the wheel with each project or leverage our knowledge and experience by using processes and templates?
- Do we reallocate money to where it’s most important so we can stay in or under budget?
Business Projects
- Are you fully utilizing the contractors and software you’ve invested in?
- Are you planning thoroughly for events to make sure you get the best ROI? “more than just a pretty face”
- If you have $10k allocated for a marketing event, what’s the line-item breakdown? How many leads and sales do you need to justify the expense?
Clients are more savvy, and they recognize excess costs. They understand they’re paying for the event swag, beautiful office, and brand packaging.
The balance is found when the service provided exponentially exceeds the branded extras in value.
Think of it like a home. It doesn’t matter that you have granite countertops if the foundation is cracked. Or like fine dining. It doesn’t matter that your food was plated artistically if it tastes terrible and the service is poor.
Expense Accounts
Are first-class and five-star accommodations in the best interest of the business? Or can you get by with business class and four-star? If you want to treat yourself with your salary, go ahead. If you want to treat yourself at the company’s expense, what does this signal to the team? If you don’t care what it signals to the team, they won’t care about being good stewards either.
- Create policies and processes to support the execution of projects while protecting business interests. This might look like submitting expense requests in advance for approval. Or it could be an employee paying out of pocket and then being reimbursed on the next pay cycle.
- Create company accounts. Assign an individual for review and approval to protect against misuse.
- Create conditions for common reimbursements (travel, accommodations, meals, travel per-diem). What’s the maximum amount allowed?
- For team travel, assign an individual to book reservations using a company account instead of each team member making their own reservations. This creates an opportunity to negotiate for group discounts.
Employees who steward money well are conscientious and resourceful. They use their expertise, experience, and relationships to stretch the budget.
If you can be trusted with a little and do it well, then you can be trusted to do well with a lot.
Employees who steward money well should be paid well, too. There is a mutual respect for the value created, which is reflected in their compensation.
