How RM Group found one version of the truth

Rotational Moulding Group is a manufacturing business made up of four trading companies. When we first sat down with its leadership, the problem was not a shortage of numbers. It was that the numbers never came together. Decisions were being made on fragments: profit without its cash consequence, one company's view without the group picture.

That is a more common situation than most boards would like to admit, and it is worth describing properly, because the fix is not a better spreadsheet.

The problem: deciding on fragments

Each of the four companies kept its own figures in its own spreadsheets, maintained by hand. Pulling a group view together meant copying, reconciling and re-keying across all of them.

Reporting was labour-intensive. It took days of manual effort every month, and the numbers that effort produced were already out of date by the time they arrived. The people doing the work were capable; the process simply asked them to spend their time assembling figures rather than understanding them.

Most importantly, there was no integrated view. Profit, the balance sheet and cash were not connected to each other, so a change in one did not flow through to the others. And there was no rolling view of cash — the question every owner-managed business eventually needs answered weekly: where will our cash be in the next quarter, and what moves it?

The approach: the business before the spreadsheet

We start with the business, not the spreadsheet. Before we built anything, we spent time with RM Group's leadership understanding how the group actually works:

• four trading companies, each with its own rhythm;
• intercompany recharges running between them;
• a family shareholding structure, with the governance and dividend questions that come with it;
• seasonal working capital, where the cash swings are real and predictable if you can see them;
• significant funding decisions on the horizon.

Only once we understood what drives value did we touch the numbers. That order matters. A model built from the ledger outwards tends to reproduce the ledger; a model built from the business inwards answers the questions the board is actually asking.

What we built

The result is a fully integrated three-way reporting and forecasting model for each company and for the group.

Three-way reporting that ties to the ledgers. The P&L, balance sheet and a direct cash flow are connected, and they tie back to the accounting ledgers every month. When actuals post, the pack moves with them.

A rolling 13-week cash flow. Week-by-week cash visibility, rolled forward each week, so the low points are visible before they arrive rather than discovered when they do.

History, budget and forecast side by side. Full historical actuals, the budget and a dynamic forecast sit together, with a three-to-five-year strategic view on top for the longer funding and ownership questions.

Scenario capability. "What if" becomes a question answered in minutes, not a question that waits for the next meeting. Change a price, a headcount plan or a capital project and see it flow through profit, balance sheet and cash together.

One version of the truth. Every number is traceable to its source, and every balance sheet check ties to zero. If something does not balance, the model says so, rather than leaving it to be found later.

The result

We think about the outcome under four headings.

Time. The monthly reporting effort has been cut substantially. Instead of being rebuilt each month, the pack updates as actuals post, and the finance team's time goes on explaining the numbers rather than assembling them.

Trust. Leadership, finance, advisers and shareholders now work from the same numbers. Conversations start from an agreed position instead of a debate about whose spreadsheet is right.

Cash. A direct cash flow and 13-week visibility have turned cash management from reactive to planned. The seasonal swings are still there; they are simply no longer a surprise.

Decisions. Pricing, payroll, capital expenditure, dividend policy and the scoping of funding facilities can all be tested before money moves, with the effect on each company and on the group visible at the same time.

What we take from it

None of this depended on RM Group changing how it runs. It depended on understanding how it runs first, and then building the reporting to fit. Four companies, intercompany flows and a family shareholding are not unusual; what made the difference was connecting profit, balance sheet and cash so the whole business could be seen in one place.

If your group is making decisions on fragments — profit in one file, cash in another, the group picture assembled by hand — we would be glad to talk it through. You can book a 30-minute discovery call, or start with our free Business Insight Assessment to see how well your business can see itself today.