The CFO as a ‘Leader’
In the context of the 4 Roles of the CFO (Chief Financial Officer), the role of Leader is viewed as the catalyst who brings the other 3 roles of Strategist, Operator & Guardian together to support & deliver the business owner’s expectations of long term growth. They will look to:
- Challenge/Shift the thinking of small business owners
- Look to drive competitive differentiation
- Deliver funding through profit growth to drive long term value
Our CFO’s deliver this role of Leader by providing the following:
STRATEGIC PARTNER TO THE BUSINESS OWNER and ADVISORY BOARD
- Performing the role of a trusted sounding board and strategic partner to the business owner and advisory board.
- Through their vast experience gained in their various roles in Finance functions, they are able to apply their knowledge and expertise to the whole of business in an “End to End” whole of revenue approach.
- This role of the CFO opens up opportunities to constructively challenge the business owner’s mind to improve decision making, by using their influence and persuasion.
STRONG SALES & CUSTOMER FOCUS
- In the role of Leader our CFO’s will prioritise spending time building relationships with the organisation’s Head of Sales and other business unit general managers, taking ownership of some of the performance related activities
- The CFO will ensure that a Balanced Scorecard measures the human resource effectiveness, innovation, customer satisfaction and loyalty as well as the financials.
- Adopting “whole of business” approach enables the CFO to remain focused on prioritisation and time allocation. The CFO uses these activities to protect one scarce resource – cash- and using it to protect an equally scarce resource – time.
- The discussion with the business owner is then how to derive the best return on those scarce resources.
FIGHT ‘SCOPE CREEP’
- In the Leader role the CFO will remain focused on operating at an optimum level of resources to understand and control the hidden costs of introducing too much organisational complexity. This complexity can be caused by proliferation of products, and or channels to market, or adding layers of management.
SET ASIDE A ‘WAR CHEST’ FOR CRITICAL STRATEGIC ACTIVITIES
- The Leader will work with the business owner to implement a plan to set aside a cash reserve in order to fund the most strategic initiative or alternatively to keep an existing project on track or accelerated to take advantage of a new opportunity.
The success of the Leader role delivering value for the business owner is dependent on developing and maintaining good relationships with the business owner and employees.
In addition, the CFO will also have to ensure the strategic, operational and business support aspect of the business are well attended in order to help SME owners achieve their goals whilst building a more profitable and valuable business.
Written by Greg Yon – CFO and Regional Director at The CFO Centre (Sydney)