Recently I read a blog posting from Cynthia Mignogna at Openview Venture Partners. It is a good summary of the role that the Chief Financial Officer can and should play in an organization. In all of my speaking engagements, I emphasize that the CFO must think strategically and be able to deliver timely and accurate information that clearly indicates whether or not the business is progressing towards it strategic plan and goals (i.e., is it winning or losing?).
I recently taught a session on Advanced CFO and Controller skills to a group of 23 CFO’s and Controllers. At the beginning of the class I asked how many could give me a concise summary of their company’s strategy – only three raised their hands. Apparently this is not unusual. In a recent study, Right Management Consultants found that less than one-third of employees are fully engaged in and know their employer’s missions. My greatest concern is that if the CFO or Controller does not know the Company’s strategy, what does that say about their ability to provide valuable data to employees and management?
A good CFO must be able to align the internal reporting systems with the Company’s strategy and translate it into key performance indicators (measures of important activities that are quantifiable, measurable and meaningful) that the other managers and employees help to identify and take responsibility for. These metrics must be reported frequently and used to evaluate the employee, team or company’s progress towards achieving the stated goals.
Every CEO needs and deserves to have a strategic financial partner on her or his team to provide valuable and actionable information in order to have confidence in the decisions he or she makes every day. If you do not have or have not experienced this in your business, please call us, we can help – and the good news is that when we act as your outsourced, strategic CFO, the cost is a fraction of what you would have to pay for a full-time CFO!