What it costs to run a business or enterprise of any size is typically lost on people.
Understanding the many layers of expenses, including taxes, rent, and operating costs is not easy for team members. Unless they have to make the connection between revenue and expenses, they prefer to let others think and worry about it.
Yet, on many teams, leaders ask their colleagues to think like an owner and to spend money believing it has a direct line to total compensation. Utilizing the resources of the organization as if they were owners is another common ask.
Thinking like an owner is exceedingly difficult to do unless team members recognize and appreciate how expensive it is to operate the enterprise and what factors truly impact the bottom line. However, a leader’s request to review the expenses spreadsheet to bring this understanding home can come across as preachy and an indirect way of asking team members to cut costs.
A best practice to accomplish a deeper appreciation of expenses and to encourage team members to more fully grasp what it takes to operate the enterprise is to make a game out of the exercise. Taking the expenses quiz is a great way of opening eyes and bringing the issue of expenses to the forefront.
Leaders prepare for the quiz by producing a set of questions about expenses that will be posed to the larger group. Using last year’s data, leaders ask the team to guess or estimate what things cost. The idea is to surprise people with questions and answers that will give them a more considered view. Pushing past common expenditures such as rent, utilities, and insurance, the best questions identify areas of investment that are often unknown to team members.
How much the enterprise paid out to conduct its meetings, host new recruits, entertain clients, upgrade software, and even track expenses, among many others, are strong topics to reveal. Most teams delight in trying to guess the costs involved and become fully engaged in the quiz. Awarding a small prize to the team member (not in finance) who comes closest to estimating the costs is a fun twist.
Conducting an Expenses Quiz on occasion at a team-wide meeting gives everyone a new perspective on how the enterprise spends its money. After the quiz, discussing which expenses most heavily influence job satisfaction, productivity, and profitability educates the team in a much more powerful way than a static spreadsheet.
When people understand the expense side of the enterprise, they are better equipped to make decisions like they own the place. When is your team taking the Expenses Quiz?
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