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 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
My journey to CFO
I started on a typical path post university, 10 years at EY as an auditor……
I loved every minute of it.
Earnst & Young (EY) had a great culture, good clients, great people in the
I started on a typical path post university, 10 years at EY as an auditor…..I loved every minute of it.
Earnst & Young (EY) had a great culture, good clients, great people in the teams, great training, 360 feedback and opportunities to work on projects outside of client work.
I remember EY with fond memories and I remember the day I finished up there were many tears, it was 15th October 2010. EY pushed hard, but they also rewarded hard workers that delivered. I got overseas conferences (Japan, Venice), to lead a global project for a new tool, which allowed me the opportunity to lead, get people onboard and manage a big roll out for the ANZ region.
I loved my team, and my clients, favourite client being Village Roadshow – what’s not to love about Theme Parks and Movies. I learnt so much, but probably didn’t realise it until I left.
My first job out was Telstra, Sensis business unit – Technical, Reporting role. Likely considered a backward step – you are over-qualified in a lot of respects but under qualified in other respects. I was lucky to have a great team, peers and made some great friends along the way. I loved the industry. I loved being part of something and driving and making a difference and seeing that difference come through.
4 years after I started at Sensis, it was sold to Private Equity, which was where my career went from interesting to super-duper interesting. Working with the private equity firm to carve out from Telstra and set up the businesss under private ownership. It was a big change. I took a lead role in working with new shareholder to manage the transition and help build the business in the new world.
This included zero based budgets, cash flow reporting & forecasting and understanding the capabilities required to deliver on the change in strategy. It wasn’t just a big change for Finance but for the whole business, but finance become central to how the business operated and therefore the role I took was pivotal to the success.
Over the next 5 years, I worked as Deputy CFO, then transitioned to CFO and looked after Strategy, Finance, Operations and IT. My role continued to expand.
I really enjoyed the experience and breadth of the role. Navigating strategy, to building a budget and metrics to measure success and the capability in the business to drive the outcomes required.
We found over the period, people self-selected, and private equity wasn’t for everyone. It was about achievement, delivery and ensuring that all key metrics are met. Incentives ensured that the key metrics were measured, tracked and managed.
The private equity approach was hardcore and a lot of lessons were learnt along the way, but for me I realised this was the environment that I enjoyed, I loved the change, execution and an ability to drive an improved outcome in the results.
Since I finished up at Sensis, I have done a number of roles with other private equity firms – doing interim CFO roles, managing transitions, integrations, operating models, strategy, business plans etc, working with different companies to actively manage an acquisition (from DD) to the first 100 days, which will make or break a business and set the tone for the new world.
These projects require different skillset but a driver that can help move things forward and ensuring that there is a plan to deliver on the synergies baked into the plan. I have done this under the banner of Whiteark. I have other clients, but mainly working with PE on assessing, strategy, plan and execution for deals, and that is what I love.
I love the planning but then being able to get in there and really deliver. My finance experience, private equity experience and breadth of roles, has allowed me the opportunity to jump into consulting to private equity with both feet.
Not sure where my journey will land me, maybe back as a CFO one day, but for now enjoying the freedom, challenge and drive of working for myself and picking my clients and making a difference every day.
With my background as CFO – we have a range of tools and FREE templates that we have generated that might help you with your day-to-day life as well. You can explore and download the templates HERE
Check more good stuff from our thought articles library
Why I love working with Private Equity?
Over the last 10 years I have worked with Private Equity, in a CFO role, interim CFO role & through Private Equity firms as a consultant.
I love working with private equity, I’ll give you 5 reasons why.
Over the last 10 years I have worked with Private Equity, in a CFO role, interim CFO role & through Private Equity firms as a consultant.
I love working with private equity, I’ll give you 5 reasons why.
1. Fast paced – private equities have made an investment, and they want a return. Speed is the name of the game. Spending money to accelerate a project / return is justified as getting to exit with the required valuation as early as possible is the name of the game. I like this.
Spend money to save time, is a great strategy when you work with Private Equity. With private equity you need to put your runners on, red ones so you can run. Long hours, quick turnarounds & a team environment to drive an outcome in a short period of time.
2. Results oriented – private equity care about results. Whether it’s revenue, EBITDA or cash or all three they want results and they will incentive management to deliver. The incentives offered by private equity firms to deliver a financial outcome are part of the DNA. If you are an ambitious business leader, you can make some money driving very hard for private equity.
I love being results / outcome driven, it’s the way businesses should be. It’s not about the presentation packs, it's about what financial outcomes you delivered.
3. You know where you stand – honest, direct feedback from private equity means you know where you stand. If you are not performing, you won’t work there anymore. So don’t worry about what they think and continue to deliver the results at the speed.
4. Know your numbers – the PE firm expects the CFO to know the numbers, all the key numbers and be able to speak to the why behind the results. This means you need a strong team behind you that will deliver and ensure you can run along at the strategic level and ensure you also know the detail.
5. Cash is king – It wasn’t until I worked in Private Equity that I understood cash. When you report cash daily and do a 13-week cashflow forecast you start to realise that understanding all the timings and levers of cashflow is critical and while the Income statement is critical, knowing cashflow and how to pull the levers becomes critical.
What you learn is that cashflow doesn’t lie. Understanding earnings to cashflow means you can really understand where you are leaking cash.
Not every Private Equity firm is the same, so this article is a generalisation however it gives you a flavour and feel on the 5 key reasons I love Private Equity
At Whiteark we provide a number of services to Private Equity portfolio companies:
👉 Transition work
👉 Integration work
👉 Transaction work
👉 CFO transformation and operating model
👉 Transformation work
Led by Jo Hands who has experienced, capable, hands-on professionals who have done this before and want to help your team and business too.
We have a number of publications that you might find interesting:
Our work at Whiteark is focused on value creation levers, we have case studies for each of these levers that you can see on our website: https://www.whiteark.com.au/
We also have a number of articles that are relevant around private equity.
You might want to explore other thought leadership articles
A Look Into My Leadership Journey with Femeconomy
Whiteark is a proud member of Femeconomy, an organisation that supports and empowers female leaders and entrepreneurs.
I am delighted to have the opportunity to share my leadership experience with Femeconomy's audience and to our followers too.
Whiteark is a proud member of Femeconomy, an organisation that supports and empowers female leaders and entrepreneurs.
I am delighted to have the opportunity to share my leadership experience with Femeconomy's audience and to our followers too.
MY EXPERIENCE
Being a CFO at Whiteark, I have had the opportunity to lead our company through a period of immense change.
I have been able to work with small and medium enterprises in order to help them achieve their goals.
WHAT IS OUR APPROACH?
Our approach is hands-on. We work with the Board, CEO, and Leadership team to understand the problem/opportunity and what is required to delivered on this.
Our commercial experienced team is handpicked to ensure we help the organisation deliver on the outcomes.
MY BELIEFS
As a proud entrepreneur, I strongly support Femeconomy's mission to inspire and empower women in the workplace.
I believe that providing Femeconomy's readers with insights on my career trajectory will allow them to identify components of their own professional journey that can be applied to any female-dominated industry.
Check this interview HERE as I share my leadership journey as a CFO and Founder.
Disclaimer: This interview was first published by Femeconomy
Source: https://femeconomy.com/jo-hands-founder-director-whiteark/
Article by Jo Hands, Whiteark Founder
Read more articles written by Jo Hands
Need help devising a strategy? Reach out.
Working closely with boards and senior leadership, we provide a blend of strategy, market insights, and operational expertise to drive results for clients. We understand that no two businesses are the same and will tailor our advice to meet your specific needs.
If you need advice on where to start reach out to Jo Hands or an expert from our team on whiteark@whiteark.com.au
If your business is having issues with cash, it's important to take proactive steps to address the problem before it becomes a crisis.