Interview With Ricky Harris, Director Of BigO
What was financial management like before you became a Beyond client?
Years ago, financial management was all in-house. We were all busy growing the business and the person whose job it was to manage the bookkeeping and accounting had other responsibilities too. This meant we were using out of date software and relying heavily on Excel spreadsheets. We had no processes in place for financial things like credit control, forecasting, or cash flow management. Essentially everything was quite outdated and manual. We were being caught out by cash flow issues and overdue invoices. There was a lot of time spent ineffectively on financial tasks.
We know you’ve managed to kick the Excel habit. How did that change come about?
Yes, we got to a point where centralising and automating our project management became essential. We started using Harvest to manage the agency in terms of time tracking, invoicing, and job management. It was a really big decision and revolutionised how we ran the business. Then we wondered what cloud accounting systems might integrate with Harvest so we could make things even more streamlined.
So we were browsing online, researching accounting software and comparing the different solutions that were out there. And in the midst of this search, we landed on the website of an accounting firm called Beyond that was just around the corner from us in Dublin 2! That’s when our relationship with Beyond started. Your first job for us was migrating bigO to Xero accounting software, and things grew from there.
A couple of years after this, you opted for an outsourced accounting package with us. What clinched that decision for you?
All bigO’s finance function together amounts to roughly one full-time job. We don’t need a full-time Financial Director, for example, but we do still need access to that kind of knowledge – monthly or quarterly. Especially when things get shaken up, like during a pandemic. What Beyond brings is a whole team for around half the cost of the financial role we had before. It’s a huge benefit. We’re not relying on just one person. We haven’t sacrificed the expertise we can access. We get the financial consultancy we need, the day-to-day hands-on input from accountants, the experienced bookkeeping… all without needing to employ someone directly.
As a boss, you’re out there running the business day in day out, but you may not look at the finances unless you believe something is wrong. When you have an in-house team, you rely on them to report up and let you know what’s happening in terms of things like cash flow. Now that we have financial systems and processes in place, we take a pause from our normal work and spend a couple of hours a month and every quarter looking at the numbers with someone from Beyond. It’s stopped us from using our gut to evaluate our financial health!
With outsourced accounting, oversight is built in at every stage. This scrutiny means we have the reassurance that we’re analysing things properly. Also, our bookkeeping is fairly complex. Video production is a large part of our business, so we have crew out spending money on wardrobe, venues, travel, etc. All these expenses must be managed correctly. Beyond has given us a reliable bookkeeper who has come to really know the business, which is invaluable.
Rory’s Takeaway
Because of how agencies work, you can have plenty of activity and be signing up big contracts but profitability and cash can still be quite fickle at times. It’s easy enough to have a bad quarter even though you’re busy. A bad December could suddenly see most of that year’s profit in danger.
That’s why it is so important to know where you are with profit throughout the year, not just after the year-end. The regular strategy meetings we hold with our outsourced accounting clients are there to notice when things aren’t quite on track and do something about it. This might include us being more hands-on while the company works through an improvement plan, giving everyone a chance to report in and review the results being achieved.
During these meetings, we drill down into the numbers together and find opportunities to bring costs down and revenues up. One example from last year is an agency that had contractors who were automatically coming into work even though they weren’t assigned to a particular project. This meant they were doing work that wasn’t revenue-generating, and this was a cost the agency didn’t need during a pandemic. Sometimes small changes can have a huge effect, but you have to take a step back to notice them in the first place.