1. White
Paper:
The
Power
of
GRANULARITY
To
Align
Strategy,
Performance,
and
Financial
Outcomes
www.FoundMoneyCFO.com
©
2013
Steve
Wilkinghoff

2. A
Quick
Word…
When
you
have
finished
each
month
(or
quarter,
or
year)
you
get
your
balance
sheet
and
profit
&
loss
statement.
The
problem
is
that,
good
or
bad,
your
financial
statements
are
completely
useless
as
tools
to
drive
you
toward
CREATING
beQer,
more
dependable
and
more
predictable
financial
results…
At
FinanIQ
we
work
closely
alongside
our
chosen
clients
and
have
the
luxury
of
seeing
and
working
with
some
of
the
fastest
growing,
and
most
dynamic,
companies
around
the
world.
We
bring
our
global
experience
to
you,
working
alongside
you
and
team
to
help
create
plans,
execute
them,
and
track,
measure,
and
modify
their
progress
toward
them.
You
are
about
to
learn
how
to
get
yourself
and
your
team
focused
on
the
few
numbers
that
are
the
TRUE
drivers
of
your
financial
results
and
desired
strategic
outcomes.
We
call
them
True
Targets.
Others
call
them
Key
Performance
Indicators.
It
doesn’t
really
maQer
what
you
call
them
(although
we
think
our
name
is
more
accurate)
–
the
key
is
to
read
this
white
paper
and
learn
how
to
use
them
to
drive
beQer,
more
consistent,
and
more
predictable
financial
results!
www.FinanIQ.com
©
2013
Steve
Wilkinghoff

3. Tons
Of
Numbers
–
Ounces
Of
Guidance…
Your
business
is
literally
overflowing
with
numbers.
There
are
the
numbers
given
by
your
accoun^ng
system;
there
are
numbers
to
track
your
opera^ons;
there
are
ra^os
and
benchmarks
that
are
created
from
other
numbers;
there
are
forecasts,
budgets,
and
variance
reports.
You’ve
got
a
ton
of
op^ons
when
it
comes
to
which
numbers
to
look
at.
The
magic
is
not
what
happens
when
you
look
at
your
numbers.
The
magic
is
what
happens
when
you
figure
out
what
numbers
you
need
to
look
at
to
drive
your
strategic
plan
and
financial
results.
And
what
numbers
(the
same
ones)
you
want
EVERY
single
one
of
your
team
members
to
be
aware
of,
to
understand,
to
think
about,
to
talk
about,
to
work
their
absolute
hardest
to
improve.
Those
few
numbers
are
what
we
call
your
True
Targets.
www.FinanIQ.com
©
2013
Steve
Wilkinghoff

4. Granular
Targets
–
An
Example
Imagine
you
have
set
a
strategic
goal
of
increasing
your
gross
profit
from
$400,000
to
$800,000
(annual,
monthly,
quarterly
–
it
doesn’t
maQer
-­‐
the
lesson
is
the
same).
You
may
think
that
telling
your
team
members
about
that
target,
geeng
them
excited
about
it,
even
promising
them
a
nice
bonus
if
your
business
meets
your
strategic
target
would
be
a
good
way
to
drive
home
your
goals,
and
mo^vate
your
team.
You
would
be
wrong!
The
problem
is
that
most
of
your
team
members
(in
fact,
not
many
business
owners)
truly
understand
how
to
CREATE
gross
profit
–
and
therefore
struggle
to
effec^vely
drive
it
with
clarity,
predictability,
and
purpose.
Gross
Profit
is
simply
an
accoun^ng
construct
that
has
ZERO
ability
to
direct
you
and
your
team
to
effec^ve
ac^ons
that
drive
you
toward
your
strategic
targets.
Instead
of
selec^ng
the
revenue
target
as
a
Numerical
Target,
it
would
be
much
more
effec^ve
to
granularize
those
targets…
www.FinanIQ.com
©
2013
Steve
Wilkinghoff

5. Revenue
Isn’t
Revenue
The
first
step
in
granularizing
your
targets
is
understanding
three
fundamental
truths
of
financial
results:
1. Revenue
is
NOT
Revenue;
2. Direct
Costs
(or
Cost
of
Sales)
are
NOT
Direct
Costs
(or
Cost
of
Sales);
3. Overhead
is
NOT
Overhead
www.FinanIQ.com
©
2013
Steve
Wilkinghoff

6. Revenue
How
Ojen
Products
Clients
Measurement
CreaYon
www.FinanIQ.com
©
2013
Steve
Wilkinghoff

7. Direct
Costs
Ac^vi^es
Team
Products
Measurement
CreaYon
www.FinanIQ.com
©
2013
Steve
Wilkinghoff

8. Overhead
Ac^vi^es
Team
Processes
Measurement
CreaYon
www.FinanIQ.com
©
2013
Steve
Wilkinghoff

9. CREATION
of
Financial
Results
Measurement
www.FinanIQ.com
©
2013
Steve
Wilkinghoff

10. True
Targets
–
An
Example
Back
to
our
example.
Instead
seeng
a
revenue
target
only
–
suppose
you
drilled
into
that
target
and
created
granular
True
Targets.
True
Targets
that
would
give
each
of
your
team
members
line
of
sight
so
they
knew
exactly
what
to
do,
whether
they
were
helping
drive
your
strategic
and
financial
results,
be
able
to
track
how
well
they
were
contribu^ng,
and
get
excited
about
their
ability
to
really
contribute.
It
might
look
a
lot
like
the
table
below…
www.FinanIQ.com
©
2013
Steve
Wilkinghoff

11. It’s
Obvious
Now
–
to
EVERYONE!
With
these
Numerical
Targets
iden^fied
and
communicated
to
your
en^re
team,
every
single
team
member
knows
that
the
goal
is
to
have
a
total
of
5,654
paying
customers
within
the
next
90
days
–
each
genera^ng
an
average
gross
profit
of
$86.34.
And
every
one
of
your
team
members
also
knows
the
goal
for
the
end
of
this
year,
next
year,
and
the
year
ajer
that.
They
have
something
tangible
(as
opposed
to
some
abstract
financial
construct)
that
they
can
relate
to
–
and
that
relates
to
how
they
view
your
business,
their
role
and
what
they
can
do
to
help.
www.FinanIQ.com
©
2013
Steve
Wilkinghoff

12. Some
Pointers
For
Se[ng
True
Targets…
You
MUST
start
by
seeng
True
Targets
where
each
team
member
knows
exactly
what
each
target
means.
True
Targets
are
concrete,
meaningful,
and
relevant
to
every
single
team
member
–
irrespec^ve
of
their
role
in
your
business.
Effec^vely
using
True
Targets
also
involves
you
tracking
these
numbers
publicly
and
sharing
them
with
your
team
members.
Good
targets
should
be
used
as
the
founda^on
for
you
to
set
your
budgets,
your
financial
forecasts,
marke^ng
plans,
communica^on
plans,
expansion
plans
and
so
on.
This
is
a
departure
from
what
most
business
owners
are
used
to
doing.
www.FinanIQ.com
©
2013
Steve
Wilkinghoff

13. Some
Pointers
For
Se[ng
True
Targets…
To
have
the
best
success
in
driving
your
strategic
financial
results
you
MUST
hold
off
doing
any
budgets
or
forecasts
unYl
you
have
idenYfied
your
desired
strategic
results
and
determined
the
granular
path
to
get
there.
Then
your
budgets
and
forecasts
must
be
created
to
align
with
your
strategic
targets,
^melines,
and
goals.
Finally,
you
MUST
make
a
single
person
accountable
for
achieving
each
True
Target.
The
person
accountable
is
more
than
simply
a
“champion”,
“cheerleader”
or
someone
that
will
merely
report
on
progress
made.
The
person
accountable
for
each
True
Target
is
the
ONE
person
who
is
responsible
for
achieving
that
target
(or
intermediate
target)
within
the
^meframe
that
has
been
set.
They
will
involve
other
team
members
in
your
company
and
have
many
people
helping
–
but
they
are
ONE
accountable
for
it.
Failure
to
do
this
results
in
excuses
and
weak
effort
instead
of
progress
–
not
cool!
www.FinanIQ.com
©
2013
Steve
Wilkinghoff

14. Make
Sure
You
Phase
Your
Targets
Strategic
targets
almost
always
involved
a
longer-­‐term
planning
and
execu^on
horizon
(usually
3
–
5
years).
While
you
will
start
work
immediately
on
execu^ng
tac^cs
to
start
driving
toward
your
strategic
True
Targets,
their
ul^mate
accomplishment
will
most
likely
take
a
few
years.
To
provide
a
bridge
between
where
your
business
is
at
any
given
moment
and
your
strategic
and
business
goals
it
therefore
becomes
cri^cal
that
you
break
your
long-­‐term
strategic
True
Targets
into
a
series
of
phased
targets
that
will
march
you
and
your
team
straight
to
your
desired
end
result.
Blending
mul^-­‐year
goals
(like
doubling
gross
profit
in
the
example
shown
earlier)
and
near-­‐term
targets
that
will
provide
mo^va^on,
feedback,
relevance,
and
urgency
is
what
provides
the
“secret
sauce”
that
makes
crea^ng
and
using
True
Goals
such
a
powerful
approach
in
your
business.
Failing
to
do
this
creates
high
levels
of
frustra^on,
confusion,
and
even
resentment
in
your
team.
These
emo^ons
are
triggered
by
the
“too-­‐large”
gap
between
the
present
and
the
strategic
True
Targets
without
a
clear
view
of
a
stair-­‐step
progression
to
get
there.
www.FinanIQ.com
©
2013
Steve
Wilkinghoff

15. Make
Sure
You
Phase
Your
Targets
The
longer-­‐term
your
targets
are,
the
less
certainty
you
can
have
about
the
ability
of
your
business
and
your
team
to
achieve
them.
But
by
“rolling
back”
your
longer-­‐term
targets
into
shorter-­‐term
targets
(i.e.
1
year
out,
and
then
the
next
90
days)
you
can
have
a
fairly
high
degree
of
certainty
about
“stepping”
your
way
toward
your
longer-­‐term
(and
bigger
target)
confidently.
It
is
emo^onally
and
psychologically
destruc^ve
to
set
grand,
long-­‐term
targets
without
concrete
short-­‐term
goals.
Failure
to
set
short-­‐term
goals
that
are
in
context
essen^ally
create
a
“pie-­‐in-­‐
the-­‐sky”
feel
to
targets
that
leave
your
team
feeling
unmo^vated,
helpless,
and
demoralized.
Experience
has
shown
that
the
most
effec^ve
approach
is
to
phase
your
overall
strategic
True
Targets
into,
as
a
minimum,
quarterly
True
Targets
–
although
monthly
has
proven
even
more
effec^ve
and
powerful.
The
best
phasing
interval
for
your
business
depends
on
the
characteris^cs
of
your
business,
your
repor^ng
structure,
your
market,
and
your
desired
speed
of
execu^on.
A
set
of
grand
and
ambi^ous
strategic
goals,
without
short-­‐term
goals
that
are
set
within
the
context
of
the
larger
goals
are
WORSE
than
seeng
NO
long-­‐term
strategic
goals
at
all
when
it
comes
to
mo^va^ng
your
team
and
crea^ng
beQer,
more
dependable
and
more
predictable
financial
results.
www.FinanIQ.com
©
2013
Steve
Wilkinghoff

16. Do
It
For
Yourself
Now…
Spend
some
^me
with
your
key
team
members
now
and
set
some
strategic
targets
and
then
phased
targets
now.
To
make
this
work
its
magic
for
you,
follow
these
simple
rules:
1. Keep
the
total
number
of
your
targets
to
less
than
4
(remember
the
concept
of
granularity);
2. Select
targets
that
will
be
meaningful,
relevant,
and
understandable
to
your
en^re
team;
3. Roll
your
targets
back
from
your
strategic
targets
to
arrive
at
next
quarter,
next
year,
etc;
4. Iden^fy
and
assign
one
person
to
be
the
one
responsible
for
achieving
each
target
www.FinanIQ.com
©
2013
Steve
Wilkinghoff

17. CreaYng
Your
Own
True
Targets
The
best
True
Targets
are
almost
always
non-­‐financial.
The
reason
is
that
it
simply
takes
too
long
for
the
impact
to
show
up
in
the
financial
results.
True
Targets
are
measures
of
things
that
will
CREATE
a
financial
result,
but
tell
you
in
advance
if
the
financial
result
will
be
on
target
or
not.
By
developing
and
using
True
Targets
you
can
essen^ally
measure
what
the
financial
results
will
be,
in
“real
^me”.
That
gives
you
the
power
to
make
changes
if
certain
tac^cs
or
ac^vi^es
are
indica^ng
that
the
desired
financial
targets
will
be
missed
if
the
status
quo
con^nues.
Assume,
for
example,
that
a
wedding
photographer
has
historically
booked
24
weddings
each
year.
And
assume
that
the
business
has
historically
received
20
phone
enquiries
each
week
from
people
looking
to
hire
a
wedding
photographer.
If
the
photographer
booked
5
presenta^ons
a
week
from
the
20
enquiry
calls
the
call
conversion
rate
would
be
25%.
In
other
words,
for
every
4
phone
enquiries
received,
on
average
1
presenta^on
would
be
booked.
Call
conversion
rate
is
a
True
Target.
It
is
a
measure
of
how
well
the
relevant
result
(geeng
customers)
is
being
accomplished.
It
predicts
what
the
financial
outcome
will
be
and
is
therefore
a
leading
indicator.
www.FinanIQ.com
©
2013
Steve
Wilkinghoff

18. CreaYng
Your
Own
True
Targets
Let’s
con^nue
to
follow
this
through
to
make
it
clear.
We
know
20
enquiry
calls
per
week
are
historically
received.
Assuming
a
couple
of
weeks
per
year
for
vaca^on,
holidays,
etc.
that
translates
into
1,000
enquiry
calls
per
year.
If
the
historical
call
conversion
rate
was
25%,
that
means
the
photographer
would
have
about
250
presenta^ons
over
the
course
of
a
year.
And
we
have
already
established
that
the
photographer
books
24
weddings
in
an
average
year
(approximately
a
10%
booking
to
presenta^on
rate).
This
process
can
be
presented
visually
by
thinking
of
a
funnel
like
the
one
you
see
here…
www.FinanIQ.com
©
2013
Steve
Wilkinghoff

19. CreaYng
Your
Own
True
Targets
So,
in
other
words,
we
know
if
the
enquiry
call
conversion
rate
is
25%
and
the
number
of
enquiries
is
20
per
week,
that
the
business
is
on
target
to
duplicate
its
historical
sales
revenue.
How
can
that
help
the
photographer
improve
the
business
and
move
it
toward
serving
his
strategic
targets?
Suppose
each
wedding
nets
the
photographer
$4,000
in
profit.
In
an
average
year
(where
he
had
24
weddings),
he
would
realize
a
net
profit
of
$96,000.
Now
what
if
the
photographer’s
strategic
goal
was
to
earn
a
profit
of
$124,000?
If
he
maintained
his
$4,000
profit
per
wedding
it
would
require
him
to
have
31
weddings
in
the
year
(up
from
the
24
he
historically
did).
So
what
does
the
photographer
need
to
do?
Should
he
run
out
and
start
adver^sing?
That
might
work,
but
it
might
not.
It’s
also
likely
to
be
very
expensive.
By
focusing
on
his
True
Target
it’s
en^rely
possible
that
the
photographer
can
achieve
this
$28,000
increase
in
profit.
At
NO,
or
VERY
LITTLE
addi^onal
cost.
www.FinanIQ.com
©
2013
Steve
Wilkinghoff

20. CreaYng
Your
Own
True
Targets
Let’s
revisit
the
True
Targets
for
this
business.
What
are
the
2
ways
the
photographer
can
get
31
weddings
booked,
without
much
addi^onal
effort?
All
that
needs
to
happen
is
one
of
the
following:
• Convert
31%
of
Enquiry
Calls
into
Presenta^ons.
This
assumes
that
the
10%
conversion
from
Presenta^ons
to
Bookings
con^nues
to
apply,
or
• Convert
12.4%
of
Presenta^ons
into
bookings.
This
assumes
that
the
25%
Enquiry
to
Presenta^on
conversion
remains
the
same.
Experience
has
shown
that
both
are
surprisingly
easy
to
achieve.
It
is
really
just
a
maQer
of
tes^ng
different
ways
of
handling
enquiry
calls,
and
of
conduc^ng
presenta^ons.
But
is
tes^ng
new
ways
of
handling
enquiries
and
presenta^ons
risky?
Not
at
all.
That
is,
not
now
that
we’ve
created
some
True
Targets
www.FinanIQ.com
©
2013
Steve
Wilkinghoff

21. CreaYng
Your
Own
True
Targets
Here’s
why.
Suppose
the
photographer
discusses
these
True
Targets
with
the
team
member
that
answers
the
phone,
and
handles
enquiries.
That
person
probably
has
all
sorts
of
ideas
that
can
possibly
improve
the
conversion
from
25%
to
31%
(likely
significantly
more
than
that).
And
by
referring
to
exis^ng
True
Targets
they
can
test
each
of
those
ideas,
one
at
a
^me,
over
very
short
periods
of
^me.
These
short-­‐term
tests
against
status
quo
are
called
micro-­‐tests.
If
the
team
member
tries
a
new
idea
for
a
week
and
it
results
in
a
Conversion
rate
of
27%,
then
that
new
way
will
become
the
new
standard
for
how
enquiries
are
handled.
The
next
week
the
team
member
can
try
another
idea
and
compare
it
to
the
new
benchmark
of
a
27%
conversion
rate.
If
the
test
for
that
week
generates
a
conversion
rate
less
than
27%,
it’s
eliminated.
If
it
creates
a
conversion
rate
higher
than
the
27%,
then
this
new
idea
becomes
the
new
standard.
In
this
way
it’s
possible
to
try
lots
of
small
tests
with
minimal
or
no
risk.
Whenever
a
new
test
results
in
an
increase
in
the
exis^ng
standard
for
any
par^cular
True
Target,
that
tac^c
becomes
the
new
standard.
Whenever
a
test
generates
a
result
less
than
the
exis^ng
standard
you
simply
go
back
to
using
the
baseline
tac^c.
www.FinanIQ.com
©
2013
Steve
Wilkinghoff

22. Are
YOU
CreaYng
The
Financial
Results
You
Want?
Why
is
it
that
so
many
ambi^ous,
hard-­‐working,
smart
business
owners
have
businesses
that
seem
to
struggle,
produce
inconsistent
financial
results,
or
simply
go
along
being
seemingly
guided
by
“random”
forces
such
as
the
economy,
market
factors,
customers,
compe^tors,
and
so
on?
One
of
the
key
reasons
is
the
lack
of
a
truly
effec^ve
and
ac^onable
plan
to
achieve
strategic
targets
that
maQer
to
the
owners,
their
teams,
and
their
management
groups.
Various
studies
have
shown
that
close
to
90%
of
all
efforts
at
crea^ng
strategic
changes
fail
to
produce
the
intended
results.
Our
experience
bears
out
the
results
of
these
studies.
At
BizDog
Strategic
Group,
we
started
by
helping
our
clients
iden^fy
clearly
defined
strategic
goals.
What
we
found
was
that,
no
maQer
how
good
the
strategic
plan
was,
no
maQer
how
mo^va^ng
it
was,
no
maQer
how
desperately
the
client
wanted
(or
needed)
the
defined
strategic
outcome
–
they
ojen
failed
to
create
anything
that
was
close
to
those
results.
www.FinanIQ.com
©
2013
Steve
Wilkinghoff

23. We
Discovered
The
“Silver
Bullet”…
Ajer
numerous
clients
where
we
helped
create
great
strategic
goals
and
plans,
yet
watched
clients
fail
to
achieve
those
outcomes
we
finally
figured
out
the
silver
bullet.
And
it
was
like
our
eyes
were
opened
anew.
We
were
so
excited.
In
fact,
the
founder
of
FinanIQ
was
so
excited
he
wrote
a
book
called,
Found
Money
–Simple
Strategies
to
Uncover
the
Hidden
Profit
and
Cash
Flow
in
Your
Business.
And
his
book
and
his
excitement
drew
the
aQen^on
of
“Mr
E-­‐Myth”
(Michael
Gerber)
who
offered
to
write
a
Foreword
for
the
book
and
went
out
and
got
the
book
a
publishing
deal
with
one
of
the
largest
publishers
in
the
world
(Wiley
out
of
New
York).
The
Magic?
Linking
strategic
goals
to
the
financial
results
those
goals
define,
and
then
rolling
them
back
into
the
crea^on
and
tracking
of
True
Goals
that
are
understandable,
ac^onable,
and
relevant
to
the
way
business
owners,
their
teams,
and
their
businesses
operate
on
a
daily
basis.
www.FinanIQ.com
©
2013
Steve
Wilkinghoff

24. Your
Next
Step…
• Meet
with
us
–
get
a
FREE
Business
Diagnos^c
and
Breakthrough
Session
with
one
of
our
trained
FinanIQ
Consultants
• Visit
us
at
www.FinanIQ.com
for
addi^onal
resources
and
thought
leadership
• Call
(1-­‐403-­‐504-­‐4918)
or
email
us
and
request
your
free
copy
of
our
founder’s
book,
Found
Money
–
Simple
Strategies
to
Uncover
the
Hidden
Profit
and
Cash
Flow
in
Your
Business.
About
FinanIQ
Global
Inc.
We
help
privately-­‐owned
businesses
create
beber,
more
dependable,
and
more
predictable
financial
results
so
their
owners
and
teams
can
play
a
bigger
role
in
their
personal
lives,
their
families,
their
communiYes,
and
the
world.
To
learn
how
to
implement
the
proven
Found
Money
Strategic
Framework,
Process
and
Tools
to
create
beber,
more
dependable,
and
more
predictable
financial
results
and
transform
your
business
potenYal
into
extraordinary
reality,
please
contact
us
at:
steve@finanIQ.com
www.FinanIQ.com
©
2013
Steve
Wilkinghoff