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7 Top Financial Indicators You Should Monitor as a Business Owner

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Olutomi Rone Financial Indicators

By Olutomi Rone

Business owners must track and monitor financial indicators to analyse their businesses’ performance. However, financial indicators necessary for monitoring performance are by no means generic, not to businesses of a similar size, not to businesses within the same country, not to companies within the same sector or industries, and alarmingly not even to departments within the same business.

The finance function within businesses must be ready to craft the right strategy for the customised design and implementation of the right metrics. But too often, it has been perceived to be a non-revenue generating, number crunching and tunnel vision function. Yet, the finance function is one of the most strategic functions of an organisation.

According to a survey of more than 500 finance professionals in the UK by webexpenses, 60% of the finance professionals felt undervalued within their organisation. About 53% felt they did not get the same respect as colleagues working in other departments.

The secret to extracting the finance function’s strategic value is offering them a seat at the table; else, the finance function is incapable of creating and maximising stakeholders’ return.

With my years of experience in metric design and implementation across businesses with different compositions and in various sectors, I will recommend using the following indicators in addition to more customised metrics.

However, the finance function should consider details like the business model, size, equity composition, PPE investments, manufacturing, and capital structure during the design phase. These top financial indicators should be designed to cover Profitability, Liquidity, Solvency, Gearing, Valuation, and Investments of the business.

Here are the 7 top financial indicators you should monitor on your periodic dashboard as a business owner.

Net Profit Margin

The majority of organisations commonly overlook this primary financial indicator; yet, one of Harvard Business School’s articles on 13 financial measures to monitor highlighted net profit margin as a critical financial metric for any organisation.

This profitability indicator measures the actual percentage of net profit an organisation earns directly related to its total revenue and is calculated by dividing net profit by the revenue in any one period. The higher the percentage of this net profit margin, the better the organisation is deemed to have performed.

High net profit margins mean the organisation has a good pricing strategy and/or operating solid cost optimisation initiatives. However, a heavily geared and capital intensive (PPE heavy) organisation could distort the net profit margin by presenting a lower net profit margin.

Gross Profit Margin

This financial indicator focuses on the direct cost or cost of goods sold and how much of this cost line is used to generate revenue for the organisation. This metric is a fundamental indicator for manufacturing companies as they tend to have higher direct costs than firms whose solutions are more service-oriented.

This profitability indicator is calculated by dividing the gross profit by the organisation’s revenue. Like the net profit margin, it should be compared with ratios from previous periods for the same firm and with other firms within the same sector. A high gross profit margin means the company is efficient in using its resources to produce goods/services.

Cash Flow to Revenue

This ratio is essential for keeping close tabs on cash generation compared to revenue generation; it provides a clear insight into how well the business collects its cash. While companies in the hospitality or aviation space might not have their cash tied down, those in the consulting or telecom infrastructure sector may have another story to tell.

The ratio is calculated by dividing the organisations operating cash flow by its net revenue. For a healthy organisation, we expect a ratio of at least one, a ratio below this could mean an ineffective cash collection system within the organisation.

Quick Ratio

This liquidity ratio measures an organisation’s ability to pay off its liabilities in the shortest possible time frame. It is calculated by deducting inventory and prepaid expenses from current assets and dividing the resulting figure by current liabilities; the ideal quick ratio is one or above.

It evaluates the current assets of an organisation. It allows the user to conduct a scenario analysis that considers what would happen to the organisation should it need to pay off its short term liabilities “quickly”.

In a US study of why businesses fail, 82% of failed businesses experienced cash flow issues; I believe a sizeable proportion of these companies could not promptly convert some assets to cash.

Debt to Equity 

This ratio indicates solvency and financial leverage; it examines the organisation’s capital structure and seeks to highlight any over-reliance on debt or equity. The ratio is calculated by dividing total long-term debt by shareholders equity. It shows debt as a ratio of total equity; a ratio of one or higher is considered less risky.

When using this ratio to make comparisons, do so with organisations within the same sector because specific sectors have a higher appetite for debt than others. A caveat is that debt is not always bad for business; it can be used to fund feasible and well-thought-through growth strategies without affecting the structure of shareholders equity.

Price/Earnings (P/E) Ratio

This valuation indicator is a robust measure of the alignment between an organisation’s share price and earnings per share. The ratio is calculated by dividing price per share by earnings per share ((net income – preference dividends)/weighted average of ordinary shares outstanding).

The P/E ratio should always be compared to sector averages. P/E ratios higher than sector average are often perceived as overvalued and risky, while shares with lower than average P/E ratios are often perceived as future moneymakers and allows the investor to benefit from share price increases.

Moreover, consider consulting an industry expert or a professional valuation firm if you need a business valuation. Doing so will give you access to expert knowledge and the necessary tools to accurately assess the value of your business and ensure that you make informed decisions regarding its growth and profitability.

Return On Capital Employed (ROCE)

This is a profitability/investment ratio, and it is often used as a decision-making metric for investment purposes like the P/E ratio. It is calculated by dividing earnings before interest and tax by capital employed (this represents the total amount invested in the organisation).

The metric tells investors how efficiently capital is being used to generate profit. It should be compared to historical figures of the same organisation to establish a pattern for capital utilisation.

All the metrics mentioned above must be interpreted together, meaning that a single promising metric should not be used as a sole positive indicator for your business.

It is important for business owners to have the right set of financial indicators that cover all the critical business sustainability areas. It sets the right accountability tone for the individuals tasked with revenue generation responsibility, small business expense report, and provides a clear target-setting basis for monitoring and performance evaluation.

With these metrics incorporated into periodic management review meetings, business owners can worry less, knowing there is a robust system in place that would identify any potential sustainability or going-concern issues before they are likely to occur.

Olutomi Rone is a director at African Ally, a global staffing solutions company. She started her career in the UK within the banking, consulting and manufacturing sectors. In Nigeria, she has worked in the consulting sector at PwC and was the Head of Business Planning at IHS, she then moved on to be the Chief Operating Officer at Kimberly Ryan Limited.

She holds a BA(ECON) Honors from the University of Manchester, UK and is ACCA qualified. She is a cross-functional leader with 19 years of experience in Business Planning and Analysis, Strategy Formulation, IPO Readiness, HR, Finance and Accounting. Her experience cuts across Finance, HR Consulting, Telecommunications, Manufacturing and Construction Industries.

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Designing Africa’s Power Systems for Reality, not Abstraction

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Louis Strydom Wärtsilä Energy

By Louis Strydom

Last year, I argued in my piece Lean Carbon, Just Power that a limited and temporary increase in African carbon emissions is justified to meet the continent’s urgent electrification needs.

That position was not a retreat from climate ambition. It laid out a credible lean-carbon pathway that reconciles power systems development realities with climate arithmetic.

The central question remains: not whether emissions must fall, but how much temporary headroom is tolerable to accelerate energy prosperity for a continent responsible for roughly 4% of global CO2.

The flexibility equation

The future of Africa’s electrification is neither “all renewables tomorrow” nor “gas indefinitely”. Intermittent renewables alone cannot power the continent’s fragile grids at scale.  Solar and wind require highly dispatchable power capacity to ensure the reliability of the system.

The real choice is not between renewables and fossil fuels in the abstract; it is between flexible firm power that complements solar and wind, and the de facto alternative: the increasing reliance on high-emissions diesel backup and widespread grid instability.

I argue that a realistic transition strategy must embrace “a capped carbon overdraft”: a strictly bounded, time-limited deployment of flexible power plants running on gas that supports the deployment of renewables and declines according to a binding schedule. This strategy means accepting minimal, temporary emissions to allow for a faster, cleaner and more resilient clean transition.

The response to this argument drew serious scrutiny. Three objections deserve a direct answer.

First: Does the case for flexible thermal power hold on a full life cycle basis?

It does. Our power system studies in Nigeria, Mozambique, and Southern Africa consistently reach the same conclusion – the least-cost long-term system is renewables-led, with flexible engines balancing variability. That holds across capital, fuel, maintenance, carbon pricing, and decommissioning. South Africa’s Integrated Resource Plan 2025, approved in October, makes the point concretely: it projects 105 GW of new capacity by 2039 with renewables as backbone, yet includes 6 GW of gas-to-power by 2030 explicitly for grid stability. Even the continent’s most industrialised economy concludes it needs dispatchable thermal capacity to underpin a renewables-heavy system. The question is not whether firm power is needed, but how to make it as clean and flexible as possible.

Second: Does this argument talk over Africa’s ambition to leapfrog fossil fuels?

No. It is designed around that ambition. Wärtsilä launched the world’s first large-scale 100% hydrogen-ready engine power plant concept in 2024, certified by TÜV SÜD, with orders opening in 2025. Ammonia engine tests now demonstrate up to 90% greenhouse gas reductions versus diesel. These are not roadmaps. They are ready-to-use technologies. The honest difficulty is timing. Sub-Saharan grids averaged 56 hours of monthly outages in 2024. The African diesel generator market is growing at nearly 7% a year, projected to reach 1.3 billion dollars by 2030. Nigerian businesses spend up to 40% of operational costs on fuel for backup power. That is the real counterfactual – not a continent neatly powered by sun and wind, but a billion-dollar diesel habit deepening every year the grid stays unreliable. Even Germany is tendering 10 GW of hydrogen-ready gas plants with mandated conversion by 2035 to 2040. If Europe’s largest economy needs transitional thermal flexibility to backstop an 80% renewables target, insisting low-income African nations skip that step is not climate leadership. It is development deferred.

Third: Does the carbon comparison include full life cycle methane?

It must. Methane leakage materially worsens the climate profile of gas-to-power because methane is a far more potent greenhouse gas than CO₂. If leakage exceeds a few per cent of production, gas loses its advantage over coal on a 20-year timeframe.

But the IEA notes that 40% of fossil methane emissions could be eliminated at no net cost with existing technology. My claim that gas has a lower footprint than coal is conditional on aggressive methane management – eliminating flaring and venting, enforcing measurement under frameworks like the EU Methane Regulation and OGMP 2.0. Without those conditions, the arithmetic fails. But the real choice in most African markets is not between pristine gas and pristine renewables. It is between ageing coal, a growing fleet of unregulated diesel generators, and new fuel-flexible plants that start or transition to gas and convert to hydrogen or ammonia on a contractual schedule. Displacing diesel and coal with well-managed gas in future-fuel-ready engines cuts CO₂, local pollution, and water use now, while building the infrastructure for fuels that eliminate fossil dependence.

The critics are right to demand rigour, full life cycle accounting, methane transparency, and credible timelines. Those are exactly the conditions that make a lean-carbon pathway work. Africa does not seek permission to pollute. It seeks the tools to end energy poverty while peaking emissions early and declining fast. Build engine power plants that run on available fuel today. Mandate their conversion tomorrow. The carbon overdraft stays small. The payback stays fast. And the technology to switch to sustainable fuels is already here.

Louis Strydom is the Director of Growth and Development for Africa and Europe at Wärtsilä Energy

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#LifeAfterLebaran: 5 WhatsApp Hacks to Stay Close with Family After Eid

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WhatsApp Hacks

You’re back home after mudik (homecoming), the suitcases are unpacked, and the excitement of being with family for Eid already feels like a long time ago. But just because Eid is over doesn’t mean the special connection of being with family has to fade. Here are the best group chat features for beating the post-Raya blues.

  1. Keep The Vibe Going by Sharing Ramadan Highlights

  • Keep the Memories Rolling with Status: Your Status feed doesn’t have to go quiet just because you’re back home. Post the most memorable throwback photos from the Eid reunion and add questions to spark responses like “What was your favourite Raya dish?” Add music and stickers to Status to keep the energy alive.

  • Express Yourself with Text Stickers: Turn inside jokes, family slogans, or a favourite Eid quote into a Text Sticker. It’s a quick, personalised way to add some warmth and humour to the group chat.

  • Skip the Stock Cards, Use Meta AI for a Personal Touch: Don’t just send a generic “Hi” or “Good morning” in the family chat. Use Meta AI to make your personalised greeting card or quickly transform a single photo into an animated image to send a heartfelt, animated check-in.

  1. Schedule The Next Reunion

  • Plan Your Next Post-Raya Get-Together: The blues often hit when the fun ends. Keep spirits up by creating a new Event in the group chat right away. Add event reminders so everyone doesn’t miss the opportunity to connect.

  • Schedule a Call, Don’t Just Say “Call Me”: Carry on the family tradition of staying connected, even when you’re miles apart. Tap + then Schedule a call in the Calls tab to lock in a regular “Post-Raya Check-in” video call. Send a reminder so everyone can join on time.

  1. Keep the Raya Spirit Alive by Getting Everyone Involved

  • Assign yourself a fun “tag” in the family group: Are you the one who always ends up cooking? Or the one who plans the itinerary for family trips? Or the master of GIFs who keeps everyone amused? Use the Member Tag feature in the group to give yourself a witty, funny, or practical role—”Next Event Planner” or “Tech Support Guru,” maybe?. Member tags can be customised for each group you’re in.

  • Share a Spontaneous ‘I Miss You’ Video: Did you just see something that reminded you of the reunion? Press and hold the camera icon to record a spontaneous Video Notes message. It’s faster than typing and instantly brings warmth and real-time emotion back into the group.

  1. Digital Hugs: Making the Long-Distance Moment Count

  • Share a Moving Memory: Don’t just send a still photo. Share a Live or Motion Photo to capture the ambient sound and movement of a recent Eid moment. It makes your memories feel more vivid, personal, and real—a perfect antidote to feeling disconnected.

  • Your Group Chat Background: Create a vibe with Meta AI: Don’t settle for a plain background for your family group chat. Use Meta AI to generate unique, custom chat wallpapers that reflect something uniquely memorable to your family: be it food, travel or a sport that unites everyone. Every time you open the chat, you’ll feel the warmth, not the distance.

  1. Make Sure No One Misses Out

No More FOMO: Send the Conversation History: Just added a family member who couldn’t make it to mudik? When adding a new member, you can now send up to 100 recent messages with the Group Message History feature. No need to recap; let them catch up instantly and feel included from the first tap.

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4 Ways AI is Changing How Nigerians Discover Businesses

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Olumide Balogun Google West Africa

By Olumide Balogun

Nigerians are natural explorers. Whether finding the best supplier in Balogun market, hunting down a recipe for party jollof, or looking for the most affordable flight out of Lagos, we are always searching.

Today, human curiosity is expanding, and the way Nigerians express it is evolving. We are speaking to our phones, snapping photos of things we like, and asking incredibly complex questions. For the Nigerian business owner, understanding this shift is a massive opportunity to get discovered by eager customers.

Here are four ways AI is rewriting how Nigerians search, along with simple steps to ensure your business is exactly what they find.

1. Visual Discovery is the New Normal

People are increasingly using their cameras to discover the world around them. Picture someone spotting a brilliant pair of sneakers in traffic and wanting to know exactly where to buy them. Today, shoppers simply take out their phones and search visually.

Tools like Google Lens now process over 25 billion visual searches every single month, and many of these searches are from people looking to make a purchase.

How to adapt: Your product’s visual appeal is paramount. Make sure you upload clear, high-quality images of your products to your website and social media. When a customer snaps a picture of a bag that looks like the one you sell, having great photos ensures your business pops up in their visual search results.

2. Conversations Replace Simple Keywords

Shoppers are asking highly nuanced, conversational questions. They are typing queries like, “Where can I find affordable leather shoes in Ikeja that are open on Sundays and do home delivery?”

To handle these detailed questions, new features like AI Overviews act like a superfast librarian that has read everything on the web. It provides users with a perfectly organised summary and links to dig deeper.

How to adapt: Answer your customers’ questions before they even ask. Create detailed, helpful content on your website and fully update your Google Business Profile. List your opening hours, delivery areas, and unique services clearly. This ensures the technology easily finds your details and recommends your business when a customer asks a highly specific question.

3. Intent Matters More Than Exact Words

Predicting every single word a customer might use to find your product is a huge task for any business owner. Thankfully, modern search technology focuses on the underlying need behind a search.

If someone searches for “how to bring small dogs on flights,” AI understands that the person likely needs to buy an airline-approved pet carrier. The technology looks at the true intent of the shopper.

How to adapt: You no longer need to obsess over guessing exact keywords. By using AI-powered campaigns, you allow the technology to understand your products and match them to the customer’s true needs. Your business will show up for highly relevant searches, bringing you customers who are actively looking for solutions you provide.

4. Smart Assistants Handle the Heavy Lifting

Running a business in Nigeria requires incredible hustle. Managing digital marketing on top of daily operations takes significant time and energy. The next frontier in digital advertising introduces agentic capabilities, which hold a simple promise of delivering better results for your business with much less effort.

The technology now acts as your personalised assistant.

How to adapt: You can simplify your marketing by using the Power Pack of AI-driven campaigns, including Performance Max. You simply provide your business goals, your budget, and your creative assets like photos and videos. The AI automatically finds new, high-value customers across Google Search, YouTube, and the web. It adapts your ads in real time to match exactly what the shopper is looking for, allowing you to focus on running your business.

The language of curiosity is constantly expanding. Nigerians are discovering brands in entirely new ways using cameras, voice notes, and highly specific questions. By understanding these behaviours and embracing helpful AI tools, you can let the technology connect eager customers directly to your digital doorstep.

Olumide Balogun is a Director at Google West Africa

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