In this instructional talk, John Briggs of Insight Tax explains how business owners can gain a real‑time view of their financial health by using visual dashboards that focus on a small set of key performance indicators (KPIs) derived from broader metrics. He clarifies the difference between metrics (the full set of numbers) and KPIs (the handful of numbers that drive strategic direction), emphasizing that the right KPIs change with business stage and economic conditions. Using an accounting‑firm spreadsheet as a concrete example, Briggs walks through weekly operational KPIs (books completed on time, new‑client onboarding speed, tax‑return stages, weekly consults), a monthly KPI called “human value capital add” that quantifies each employee’s financial contribution, cash‑balance monitoring, client‑count and churn tracking, and detailed expense categorization (annual vs. monthly costs). He also shows how to break down team investment by wage, payroll taxes, and W‑2 versus 1099 costs, calculating the revenue multiple needed to justify compensation. Throughout, he stresses that profit is a deliberate choice and that owners should align their KPI selection with the activities that move the business forward, whether that’s sales consults, product delivery speed, or team cost efficiency.
Chapters
How can I better understand the real-time financial picture of my business? I'm John Briggs with Insight Tax. Uh, let me answer that question. So, uh, even for people who aren't visual, I believe in order to answer this question, you are going to need something visual to look at. So a couple things regarding to that: KPIs, key predictive indicators or key performance indicators, whatever acronym you want. It's a key number that helps you understand the financial picture of your business. KPIs are metrics. Metrics are KPIs, but they're not— metrics and KPIs are not the same thing. In my mind, metrics are The multitude of numbers that as an owner you probably want to be seeing and looking at, and the KPIs are the specific ones you're focusing on based on the direction you want to take the company. And that KPI, whatever those indicators are, will and can change depending on where you're at. A business and startup is gonna have different KPIs than a business who is looking to maintain. You're gonna have different KPIs depending on what's going on in the economy. But all of those are metrics. They're just— you want to have a small, less than a handful of KPIs you're looking at, because those are going to be activities that drive the direction you're wanting to take the company. Whereas metrics, there's a few numbers that I think are really important that everyone should be looking at. in their business. So let me share with you an example of an accounting company. These are just examples though. So on the bottom— so again, I guess I should iterate, I'm answering the question, how can I better understand the real-time picture, financial picture of my business? And this is how we do it at Insight Tax. It's how I do it. This is an example. These aren't our, um, all of our real numbers or names. You can see at the bottom of the spreadsheet I have weekly metrics, monthly metrics, monthly expenses, uh, my team investment, and then I'm not going to look at the licensee tab, um, in this example. But so what are the weekly things for an accounting firm, for example, that drive it forward? So you can see that how many books are being completed on time. And for us, on time would indicate— we would say if I got the report out to that client during that month, or at least the week it was assigned, then we're on time. When a new client signs up, something that moves a business forward is how quickly is that bookkeeper getting the new client added into the system and ready to go. Filing tax returns, and there's different stages, uh, data prepped, reviewed, sent to client. And then from a marketing standpoint, how many consults are going on? For your business, you need to pick activities that drive your business forward, whatever those activities may be, but they need to be key to what you're trying to accomplish. So if growth is what we're looking for, uh, while we track on a separate marketing spreadsheet that the marketing team looks at for their metrics, the number as the owner I'm interested in— the most important activity for me is weekly consults. I don't care how many leads we get. I don't care how many blog posts we're writing. For me as the owner, I'm interested in looking at the weekly consults, so actual sit-down meetings with potential new clients. But you need to determine what those activities are for you. And as a side note, I think every department in your business should have some metrics that they're looking at. From a monthly standpoint, I personally like this metric called human value capital add. It's basically the financial value an average employee brings to the organization. Um, and the way this is set up is so that it automatically calculates the complicated formula. Uh, but again, this is an example of numbers an accounting firm would potentially be interested in. Now, a lot of companies, service-based companies, could be interested in human value capital add. So this is something maybe to consider. It's a good metric because now with all these numbers, keeping an idea of what's the best way to track the real-time financial position of my business, this helps me see that. I can see, like for an accounting firm, you can see March and April are up, which they should be because there's a lot of influx in revenue those months because of the nature of tax filing deadlines. Depending on what you have. If you have ongoing recurring revenue, maybe that's something you want to track separately from just your deposits of, you know, work you do as it happens. I know I can find this information on my balance sheet. I personally like to see— it's easier for me to track cash balance this way. I want to see if— is my cash balance going up or down? And if it is going down, how quickly is it going down? That's going to give me a good idea of if we might be in trouble with cash flow. Um, total clients, also something I like and something that I want to— I want to pull that number once a month. How many clients do we have at the end of the month? Also, how many clients did I lose? Because you can add as many new clients as you want, but if you're losing them at the back end, then that doesn't help at all. Something to consider— again, these are just ways in which you can answer the question, how do you better understand the real-time financial picture of your business? Listing out the expenses that you have. In this case, you can see the format here. All the ones that are due annually are at the top, and that helps you see, okay, all these annual costs. Which are bigger numbers, uh, really it's about $5,000, almost $6,000 a month that, uh, is getting spent every month. It's just you got to pay it at once. So in order to not get in trouble with, uh, those annual expenses, maybe set aside that money as you go. Uh, and so then you can see at the bottom, you add them up. What's the monthly cost of all these added up? And then this payroll is coming from the team investment tab. So with this example, this particular example, they see, okay, they need $211,000 a month in revenue to at least cover the expenses that they've— that they feel like are necessary for the business. You can also break out your team members so you have a clear place to see them. Interesting format here. is you have their wage amount, but as a business and their W-2, you have a separate cost on those. So that takes that into consideration, the additional cost for unemployment insurance and payroll tax. And then you have an annual cost. So then you can see what's my— what's the annual burden for this particular team, right? And Keep in mind, all the names have been changed and all the numbers are not also true. This is an example. But you can see here that this particular payroll, you have some people are paid 1099, some people are paid W-2. But again, you go back, this $155 helps with this calculation here on monthly expenses. So weekly metrics, monthly metrics. How much does your team cost? These are all things that are worthwhile when you are trying to understand the real-time financial picture of your business. You can certainly go into your books and pull a profit and loss statement and a balance sheet report. But for me, having those types of metrics are better to understand the real-time financial picture. The financials are really giving me a snapshot of the past and right now, and with the metrics and that example that I shared, you can kind of see there are other things that drive the results that are shown on the profit and loss statement. And to understand the real-time financial picture of business, that's what you're interested in seeing. You want to see what are those driving factors track those. So it could be sales consults for you, it could be delivery of product, it could be your turnaround time on the delivery of product, it could be the cost of your team and how much revenue— multiple of revenue— you get back from that team investment. Because we love our people, but at the end of the day, they— in order for the business to stay a business, there needs to be a multiple of revenue received for compensation given to team members. If that's not the case, then it's not a win-win situation for everybody. So hopefully that helps, uh, give you something to look at, uh, as an idea of what you can create for yourself. Remember, profit is a choice. Have the courage and wisdom to choose it.
