Allan Lutes is a big-picture kind of guy. He likes to know what's coming down the road. So the owner of Alpha Remodeling in Ann Arbor, Mich., created this worksheet.
The easy-to-interpret spreadsheet gives Lutes and his board of advisors a snapshot of key indicators. Although financial statements provide one method of getting an overall picture, Lutes says, “they don't tell the whole story. Adding other key indicators provides a better picture of the strengths and weaknesses of the company at that time.”
In previous years, the indicators have been used in determining marketing budgets, hiring employees, and diversifying the company's products. The numbers enable Lutes to not only look ahead, but to also be critical of where improvements could be made. “We are more in control of our business, and we are making ongoing adjustments that improve the company and profitability,” Lutes says.