Finance

"Nickels are precious, Mike." I almost laughed in his face. This was one of the nuggets of wisdom I received from one of my mentors, long ago.  He always insisted that we hold tightly to every nickel and dime we had in hand, or had earned but not collected. I used to think this was an extreme point of view, but experience has shown it to be valid.  Because so many years have passed, I might say it a bit differently today: Dollars are precious. Particularly when it comes to managing our cash. (more…)

Ever have that feeling that you brought too much stuff, and now you're stuck with it? Last week, we likened Overhead to a heavy load that a firm must carry alongside direct salary costs. Baggage, if you will. Sometimes, we over-pack.  Then, we must carry all that stuff until we do something to lighten the load. (more…)

Imagine the firm's Overhead Rate as a burden placed on its back as it goes about the business of doing its work. How much is the firm built to carry? The man who taught me the most about design firm management was absolutely relentless about reducing our Overhead Rate. He would not rest if it wasn’t in the vicinity of 1.0.  If it increased to 1.20, he would become incensed and storm around the office, berating people about their non-billable time and overhead expenses. Anything approaching 1.50 was nothing but mismanagement to him. (more…)

Someone at the bakery had been cooking more than pastries. The deeper they looked, the bigger the theft appeared to be. I know, I know—it’s not going to happen to your firm.  Your firm is solid, and you trust everyone in it. What could go wrong, anyway? (more…)