Red Flag Radar
Toggle each signal that's happening in your business right now. The score below tells you how urgently to act.
Revenue Behind Plan by >10% at Mid-Month
If you're more than 10% behind your monthly revenue target by day 15, catching up by month-end requires doubling your run rate. That almost never happens without deliberate intervention.
Know your revenue-to-date by day 15. If the gap is >10%, act now — pipeline acceleration, deal expediting. Don't wait for month-end.
Headcount Costs Rising Without Approved Headcount
Your payroll cost is increasing without an approved hire. Common causes: unauthorised overtime, a contractor miscoded as an employee, a verbal hire not confirmed in writing, or an unapproved pay increase.
Any month where headcount costs are >3% above budget without an immediate explanation — investigate that week. Headcount is your largest cost and unexplained increases compound.
Accounts Receivable Ageing Beyond 60 Days
Customers who haven't paid after 60 days are at significant risk of not paying at all. Uncollected invoices become bad debts — a direct hit to your P&L.
Check the receivables ageing report monthly. Any balance over 60 days needs active follow-up. Over 90 days needs escalation to your finance team.
Operating Cash Flow Negative for 2+ Months
The business is burning through cash reserves faster than it's generating them from operations. A business can survive loss-making periods — but not indefinitely negative operating cash.
Track the monthly operating cash flow figure. If negative two months running, ask finance to explain the driver and confirm there is a plan.
Gross Margin Declining 3 Consecutive Months
Either prices are falling or costs of delivery are rising faster. The fundamental economics of the business are deteriorating. This won't fix itself.
Identify whether it's a revenue side problem (price erosion → commercial response) or cost side (input inflation → cost management response). Three months = a trend, not noise.