The CFO role has many dimensions
The CFO role has never been so important. Companies are navigating uncertain territory and having a strong CFO that can manage the nuts and bolts of finance and help navigate the commercial as well is instrumental to how companies navigate this period.
The CFO is expected to know the numbers, manage the numbers and be proactive across the key financial metrics that can impact the ability of the business to do what it needs to do. The CFO needs to have the strength to battle the business when necessary, when the financial performance is below the budget/forecast view.
The CFO is also expected to be the strategist, working with the business to understanding/build and execute on the strategy. The budget and 3-5 year plan needs sufficient investment for the businesss to deliver on the longer term plan.
You can’t forget cash, cash is instrumental to ensure the business can operate, if you have a profit but don’t have operating cashflow, you get yourself into challenges. When COVID landed, many businesses that had not actively managed cash, needed to start, however there are businesses out there that don’t actively manage their cashflow, and this is a mistake.
You need to understand your timing of receipts, timing of payments, working capital requirements (inventory etc.) and understand how this interacts with your budget and forecast.
A 13-week cashflow forecast, is a must and allows you to look at your CF weekly against the budget and then roll another 13 weeks to understand the ins/outs of each cash. Once you understand cash, you can start to actively manage cash. Cash is king and in the current environment even more important than ever.
The CFO leads a finance team, sometimes owns other functions, works closely with the CEO and Executive Leadership team, and is actively involved with the Board, Shareholders and other key stakeholders.
The CFO also takes a leadership role with other projects, business unit to demonstrate the importance of Finance in supporting the other business units. Your shareholders will determine what kind of CFO you become…as in a private equity environment it’s quite different too, private ownership or founder lead company. Whatever the case, the role is varied, hard, challenging and rewarding.
If you are a CFO and looking for some tools, templates and relevant articles, see below Whiteark has some great tools for you to use in your role and with your teams. Jo Hands, Founder/Director of Whiteark has walked in your shoes and has some great experience with related topics and has some practical tools and templates you can use.
Check our CFO guide HERE .
Explore our thought leadership articles about Finance and CFO’s HERE
Check more good stuff from our thought articles library
