Part 1: Intersectional Accounting

Consider the following statement, and fill in the blank:

“_____________ is pragmatic; it asks how it is possible to get an individual to do something effectively.   To answer this question, the behavior itself must be objectively measured.   Verbal descriptions are treated as behavior in themselves, and not as substitutes for the behavior described.”   

Sounds like psychology of some kind, right?  Could you fill in the blank with “Applied Behavioral Analysis?”  You could, because that quote is taken from a Wikipedia entry on the subject of “ABA”, as one of the key foundations of that field of psychology.   

But, wait.  Let me ask you a what-if question: What if you could also fill in the blank with “Fiscal Management Consulting?”  Is that possible?  Could really good accounting – no, let’s say great accounting – actually lead to practical, effective behavioral changes within your business?

If you’ve been reading this blog long enough, you already know the answer.  Look, we’re now headed into the 4th quarter of a year that I think we can all agree has been, to use a scientific term, seriously jacked-up.  It might get worse before it gets better.  But this is still planning time, budget time, implementation time – because you don’t want to wait until January.  So if you are “sick and tired” of being sick and tired of the same old problems in your business, here is your chance.   

More questions: Even before COVID and our partial social meltdown, was your business lacking something?  Was it NOT all that it could be?  Were you bothered by the apparent inability of your staff – including your senior staff (including YOU, maybe) to change behaviors, habits….results?  Were you tired of lip service with no sustained action toward change?   

If you answered “yes” to any of those questions, the answer is probably a combination of three things:

  1. You don’t know what you want.  You.  The business owner.  You haven’t adequately defined exactly what you are trying to achieve;
  2. Even if you have done #1 well, you haven’t communicated it effectively to those who work for you and with you.  They are dedicated but confused, and they may have stopped listening. 
  3. Even if you have done #1 and #2 well, you do not have the financial tools, reports, isolated metrics, and deep-dive accounting analysis that are necessary for you to make data-driven decisions.   

What if you could consistently measure the isolated financial impact of behaviors within your company, use that data to create transparency and change within a specific division, department, or employee, and then integrate that change with your overall financial targets?  This is where a little bit of psychology intersects with a lot of great accounting practices.  Let’s call it Intersectional Accounting because….well, why not?

Next time, we’ll talk about the five characteristics of this idea of Intersectional Accounting, using psychological principles.  Your approach must be:

  1. Accountable
  2. Transparent
  3. Achievable (“do-able”)
  4. Empowering
  5. Optimistic.   

Can’t wait to get to that topic in early October.  

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