Situation

An established professional services firm needed insight into how each partner’s work contributed to the bottom line. A novice managing partner had a strategic plan to motivate partners to contribute to the firm’s success through various criteria, but monthly reports indicated that most partners’ contribution to the bottom line was negative despite excess cash at the end of the year. Multitudes of detailed reports were produced but the managing partner was unable to meaningfully interpret them. The experienced controller and business manager were unable to synthesize the information and the staff was on edge about adding yet more complex reporting to the system.

Solution

A NextLevel executive assessed the firm’s reporting systems and financial status, and determined the managing partner’s key information needs. The assessment confirmed that the firm was profitable, the reports were accurate and all the data was included in the reports. Due to volume, excessive detail and the lack of adequate interpretation, the information was not being used appropriately for decision-making.

With the NextLevel executive’s guidance, the firm designed summary-level reports that highlighted key data. She also coached the team on the importance of analysis in addition to internal controls and recordkeeping. Training was provided to the staff to prepare the new reports without extensive effort and to help the managing partner understand the business meaning of the information.

Results

  • Tools became available to track each partner’s performance, enabling the firm to understand and plan its revenues and expenses.
  • The managing partner responsible for the strategy confidently communicated partner contributions to the firm.
  • Staff were happy that the partners were satisfied with their reporting and that no extensive new systems were required.

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