Wharton Professor Len Lodish says “It’s better to be vaguely right than precisely wrong.” And he’s right – until it’s time to get precisely right. Amazingly enough, if you want to understand what’s going on below the surface of your organization, and why it’s happening, you have to get very precise and dig into the details.
East Coast Wings and Grill Sam Ballas understands this. He applied his financial background to his family’s restaurant business to “move the needle with numbers”. His insight was that profit and loss statements, balance sheets and cash flow statements are retrospective pictures of what happened. To understand what is happening now and why requires a deep-dive into micro-level data as close to real time as possible.
Ballas figured out that it’s not good enough to look at numbers on a monthly basis. It’s not even good enough to look at them on a daily basis. He and his team worked to understand variances within the day. He wanted to understand traffic count – who was coming back or not coming back and why. They looked at the menu mix by day part. They looked at food cost, recipe costs, and how product moved through their stores.