Why the monthly report takes two days

At the start of every month somebody sits down and puts together last month’s numbers. What was sold, what came in, what it cost, what is still owed. It ought to be an hour’s work.

It takes two days — and usually not even two days in a row: one day, then a wait for a figure from someone else, then another day. What eats them is not the arithmetic.

Where they actually go:

1. The first half day goes on gathering. Sales are in one file, invoices are with the accountant, hours are on a timesheet, payments are in the bank statement. Nobody starts the report; everybody starts by asking three other people for files and waiting for an answer.

2. The same figure comes out differently in two places. The sales total in the order file does not match what invoicing says. Neither is wrong — they count different things: one puts an order in the month it arrived, the other in the month it was invoiced. Settling which one is the real number costs an afternoon.

3. The work is rebuilt from scratch, the same as last month. The same filters, the same copying from one tab into another, the same column order. None of it is written down, so it gets reconstructed from memory — which is why it keeps being done by whoever did it last time.

4. Every month has one case no rule covers. A credit note, a discount agreed over the phone, a delivery made on the 31st and invoiced on the 2nd. What happens to it is decided on the spot, usually differently than last time. That is how two months side by side stop being comparable.

5. The correction arrives after the report has gone out. Someone reads it over and says one of the figures is off. It starts again from point 1, except now there is a deadline on it.

What it means

The report is not hard. It is rebuilt.

The data sits in places that know nothing about each other, and the method for pulling it together is written down nowhere — it lives in one person’s head. So at the start of each month nobody runs a report: somebody reconstructs one. Finds the sources, reconciles them, reinvents the rules for the odd cases.

Two things sting more than the lost time. The report is ready on the 3rd or the 5th, about a month nothing can be done about any more. And for as long as the method lives in a single head, the month that person is on holiday closes later, or closes worse.

What to put in its place

A place the report can come out of on its own.

In practice that means:

• each thing is written down once, when it happens: the order when it is taken, the invoice when it is issued, the hour on the day it was worked;
• the rules live in the software rather than in someone’s head — which date makes a sale belong to a month, what happens to a credit note, where the delivery on the 31st goes;
• every total can be opened: click it and the rows it is made of are right there, so there is nothing left to argue about;
• the report comes out in the same shape every time, so two months compare without being recalculated;
• when somebody wants a different cut — by customer, by product, by person — it is a filter, not a fresh piece of work;
• the month in progress can be looked at on the 12th, not only the finished one at the end.

The starting point is usually not the report but the place it comes from. The first version gathers into one place what today sits in four, and the report falls out of it almost by itself.

Next month closes either way. If you would like the second day back, write to us — a short conversation is usually enough to tell whether the report can build itself out of what you already have, or whether the data it comes from has to be sorted out first.