Financial Vision

Most of us eventually realize when we need a new prescription for eyeglasses. But, how often are we aware that our financial vision is out of focus?

Know Where You’re Going

You’ve probably heard the saying, “If you don’t know where you’re going, any road will get you there.” This is a paraphrasing of a section from Alice in Wonderland that is often attributed to Lewis Carroll. Regardless of who gets credit, the sentiment is most assuredly true. In the financial realm that means having a vision of where you want to be at any point in time. I’ve touched on this a little in other postings, buy I want to go a little deeper.

Long-Term Vision

Eyeglasses are sometimes used to see better at a distance. Long-term financial vision is critical. As Stephen Covey said, “Begin with the end in mind.” That means for a company’s financial area you need to visualize what you want your company to look like in three, five, ten or more years. While some of the more long-range visions will undoubtedly be less accurate, they still help direct your focus.

Short-Term Vision

Eyeglasses are also used to improve near vision. Like that, short-term financial vision is focused more on what things look like currently and in the near future. Obviously, because this is more the here and now it is easier to get a clear vision than it is with the long-term. It is also easier to fine tune and make adjustments on the fly. But, the real significance of short-time vision is that it moves a company toward a long-term result. That means the short-term financial vision needs to be developed in light of the long-term financial vision.

Here is an example. If the long-term vision is to be the “go-to” company for particular services in your community, then the short-term should be supported by goals and practices that move the company further along the road to realizing the long-term.

This may all sound like one of those things that when we hear it our response is, “Well, duh. Tell me something I don’t know.” Yet, the point is, even though a company’s top management may know this, why do so many not actually act on this knowledge?

What about your company. Do you truly have a long-term financial vision and does you short-term financial vision support achieving it? If not, perhaps it’s time for a new financial prescription. The long-term financial vision is a part of the overall long-term vision for your company. For more on this see Why You Need a Vision Statement.

If you want to know more, contact AimCFO – Contact

As always, your comments are welcomed.

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