Driving cash flow in any business is crucial to remain viable. One of the most simple and effective tools you can use to do this is – The 8 Cash Flow Drivers – which is part of the Entrepreneurial Operating System (EOS).
In this episode leading accountancy and financial planning specialist Damien Butler discusses this tool with me and takes us on a journey of how businesses should be looking past pricing, understanding other areas of the operation to improve cash flow and deliver real results to the business.
Transcript
Murray Smith: Damien Butler from Butler—welcome to Gripping Business Tales.
Damien Butler: Thank you, Murray. Pleasure to be on.
Murray: No problem. Now, when we say Damien Butler from Butler, there’s a bit more of a story to that. Butler offers both chartered accountancy services and financial planning. We wanted to bring you on today to talk about one of the EOS tools: the eight cash flow drivers.
But before we get into that, like with all our episodes, can you share one personal success and one professional success you’ve had recently?
Damien: Thanks, Murray. Well, obviously very testing times at the moment in the middle of a global pandemic. Personally, we’ve got four children at home and were tested with remote schooling. Two of them—our eldest—are twins doing VCE. So finally getting them back to school and preparing for exams has been a big success.
And on top of that, we’ve just had five puppies from our corgi—so it’s been busy, but also great to have some new life around.
Murray: Glutton for punishment by the sounds of it, Damien.
Damien: That’s right. I saw a quote the other day—“If you bite off more than you can chew, just chew like hell.”
Murray: And what about your professional success?
Damien: Again, COVID-related. I’ve been really proud of how our firm has supported businesses through this period. We’ve helped clients access state, federal, and even local government grants. We’ve also been there as a sounding board—getting our accountants closer to clients, helping them adapt.
It’s been patchy out there. Some businesses are thriving, some have closed, and some are making more than ever thanks to things like JobKeeper and cash flow boosts. But it’s a week-to-week game—one week’s up, the next is down. Strategies are constantly shifting.
Murray: That patchiness of success is part of why we wanted to get you on. Cash flow is difficult to manage, even for businesses doing well right now.
So for our listeners, could you share more about your background and how Butler started?
Damien: Sure. Butler originally came out of a tax law firm called DBA Butler, where my brother Daniel was principal. He’s recognised as one of Australia’s top tax and superannuation lawyers. I supported him initially—he’s also a chartered accountant—and we established the accounting arm to deal with complex tax and accounting matters.
As the law side grew, I took over the accounting side. We supported self-managed super funds and moved into business advisory about 20 years ago. That model’s built on a quarterly process where we close off accounts, review cash flow and performance, and help clients look forward proactively.
More recently, with changes in financial planning post-Royal Commission, we’ve integrated financial planning into the firm too. It aligns with our accounting approach—fee-for-service, data-driven, and focused on client outcomes. The business advisory side is about growing profits, and the financial planning side is about what to do with them—retirement, succession, investment.
Murray: That’s a great journey into helping businesses. Now, let’s shift to cash flow—broadly speaking. In EOS, we ask clients to think about what could positively impact cash flow: increasing revenue, decreasing expenses, improving efficiency. What do you see as the main drivers of that?
Damien: I think it’s a combination. Often when businesses prepare a budget, they only look at increasing revenue. But for some, that’s the worst thing they could do. Every extra dollar of revenue might bring an equal dollar in expenses.
So we look at things like cash locked up in the business—accounts receivable, inventory—and put a value on freeing that up. Bringing in debtor days or reducing stock levels can immediately unlock cash.
Pricing is another lever. It’s tough right now to raise prices across the board, but small regular increases—1 or 2%—can help.
In terms of increasing volume, we focus on dollars per customer or per sale. For example, don’t discount the first product—discount the second or third. Think of petrol stations: they upsell with Mars bars or Coke bottles at the counter. Package deals and bundling work.
Murray: And what are the biggest mistakes you see businesses making when trying to boost revenue or reduce expenses?
Damien: Focusing too much on top-line sales at all costs. Or not freeing up cash—leaving too much tied up in debtors and inventory. Not negotiating with suppliers to get better deals.
A lot of people haven’t reviewed their overheads in years. Subscription services, old phone plans, SaaS—these creep up. Switching to VoIP or renegotiating plans can save thousands. We love line-by-line reviews—most business owners don’t—but that’s where you find the low-hanging fruit.
Murray: What signs should business owners look for that say, “Hey, there are savings or gains to be made here”?
Damien: One of our tools is a financial diagnostic where instead of targeting profit, we target cash flow. Say your cash flow was $200K last year—how do we get it to $300K?
Then you target drivers: pricing, margins, overheads. Small improvements across the board can have a compounding effect. It’s those 1% gains that add up.
Murray: In EOS, we assign accountability to someone on the leadership team for each cash flow driver. In your work, how important is it for this stuff not to be left to “the accountant” or “the CFO”?
Damien: Hugely important. One of our frustrations is assigning actions and then having no follow-through. A quarter goes by quickly.
But if you distribute actions across the team and have ownership—like your process does—it has greater impact. Smaller tasks, shared responsibility, more done.
Murray: And then you set goals—what we call “measurables” or “past three” in EOS. What have you seen in businesses that start goal-setting seriously?
Damien: Remarkable outcomes. We’ve worked with businesses that never had a budget before. They doubt the targets, think they’re too ambitious—and then 12 months later, they’ve met or exceeded them.
Goal setting focuses attention. People monitor pricing, margins, and overheads more closely.
Murray: What makes for a good financial goal in your view?
Damien: The SMART principle still applies—Specific, Measurable, Achievable, Realistic, Time-bound.
But for us, it’s about the trend. Even if your initial KPI isn’t perfect, if it improves every quarter, that’s progress. Refine the KPI over time. It’s the improvement that counts.
Murray: And what about the emotional side? Talking finances can be sensitive—how do you handle tough conversations with business owners?
Damien: Our process is like a board of advice. We meet quarterly, compare results to budget, and identify why they are or aren’t meeting targets.
It’s not about the past—it’s about improving the future. We look at data, trends, KPIs. Sometimes the market shifts and you need to act fast. And in Australia, the biggest cost is often labour—which is hard to change. So regular monitoring is key.
Murray: That aligns with EOS too—quarterly reviews, setting 1-, 3-, and 10-year goals, and constantly checking in.
Damien, thank you so much for coming on to talk all things cash flow. For those who want to get in touch with you or Butler, how can they do that?
Damien: The website is www.butlerca.com.au. Or just call me—my mobile is 0412 587 812. Happy to chat.
Murray: That’s brilliant. Thanks again, Damien. It’s always good to talk finances—especially now. Really appreciate your time.
Damien: You’re welcome, Murray, and thank you. I think the work both of us do—helping businesses survive and thrive through this—is incredibly important right now. It’s tough, but it’s also time to knuckle down and get through it.
Murray: Hear, hear. Thanks, Damien.
“Target cash flow. It’s that sort of magnifying effect…it goes a long way.”