The role of the CFO in modern business has changed. CFOs are increasingly key decision makers and business all-rounders who are crucial in formulating and executing upon strategies.
Nowadays CFOs in large businesses have a range of responsibilities from strategic planning, procurement, I.T, commercial activities; partnerships, pricing, deals and M&A and in some cases marketing. Whilst they still look after typical finance activities (tax, financial accounting etc), shareholders and CEO’s expect CFOs to have versatile business skills and knowledge and be act as a value add advisor and partner to the business.
The “Commercial” aspect of a finance function is often overlooked by smaller businesses, who often see their finance team as an overhead who pay their staff and the bills, manage cash flow, invoicing and tax. As such, many Owners are missing out on a big opportunity to take their businesses to the next level.
3 tiers of finance support in a business
Bookkeeping – Process driven; AP, Payroll, BAS, AR, Invoicing, Reconciliations. The bare minimum to fulfill statutory obligations.
Accountant – Financial reporting, basic planning – budget / forecast, cash flow forecasting and tax. Generally focused on historical information such as month end reporting.
Operational performance and metrics – headcount planning, marketing ROI, optimise inventory and sales performance
Financial planning – budget and forecast, cash flow. Focus on the future not the past
Strategic planning – objectives, product strategy, future business models investment and critical success factors
Decision support – pricing of deals, new business models / markets, modelling etc
Structure – optimise capital and corporate structures. Reduce tax
A strong CFO will help put long term plans in place, monitor performance and critical activities and also execute on objectives.
Do you have the support you need to reach your objectives?
Small Businesses often arrive at a critical juncture, where by an opportunity emerges to push the growth peddle to the floor. But they often lack the firepower to plan, focus and execute on these opportunities. A seasoned commercial finance person / CFO can play a big part in you achieving your growth ambitions. Paying for a $150K to $200K p/a resource may not make sense. Having a virtual CFO to work a day or two a week will in many cases improve your commercials whilst not breaking the bank.
CFOs on demand is based in Sydney offering part time, outsourced CFO and CFO advisory services, contact us for a free consultation.