CFO Success Series: Managing Key Resources
To build our future we must invest in the present.
Not long ago I had a conversation with colleagues about the value of an audit. It made me reflect on how the really good financial leaders I know surround themselves with the skills they need before they need them. They are rarely at a loss for quickly getting great advice on a topic critical to their team’s success. If they don’t require a key skill full time, they tap into advisors they can count on to deliver what they need. These leaders are experts at:
- Identifying the key skills their business will need in the foreseeable future
- Building relationships and a network that includes all these skills
Back to the audit. As we compared notes it was clear, the best chief financial officers on our list used their CPA’s as a business resource, not a financial cop. Conversely, poorly performing finance heads frequently viewed the “cost” of an audit or review as something excessive and non-value added. They relied on their tax accountant to deliver financial advice. The analogy…It’s unlikely your all-star car mechanic would be your first choice to fix a plumbing problem in your home.
Shareholders, banks or partners may require an audit but using your CPA as a business expert beyond attesting to your financial statements is where their real value lies for your company.
This concept goes beyond financial audits and CPAs. Bankers happen to know a lot about the economy and have fact-based ideas on where it is headed. A banker in your business space can be very valuable to your planning process. Likewise, insurance professionals, are experts in risk management. An insurance broker familiar with your industry can add immediate value by identifying ways to mitigate key risks in your business you may not have considered.
Additionally, CFOs are being relied on more and more to identify the value creation levers their company has to pull to improve performance. These levers are not only found in the financial statements. They are found in areas like quality, service, talent, customer journey, risk management, etc… If the expertise to identify these levers doesn’t exist within the company a CFO may find themselves flat footed when it comes to delivering against this rising expectation. It’s you job as CFO to make sure you have access to all the resources you need.
Go down the list of other services that are business critical to determine if you have built the relationships required to quickly tap into these skills. Examples include; legal, training, recruiting, technology, mergers and acquisitions, etc.
After identifying what critical professional resources are missing from your in house team, identify what outside agent has the right knowledge base and mindset to fill your resource need. Frequently what prevents us from taking this step is the fear of “being sold”. In the early stages of researching and developing these relationships this fear may prevent us from developing the right foundation to build our resource pool.
Like employees, our outside advisors need to be paid for the value they create; it only makes sense that we will provide them a return on their investment equal to some portion of the value they create. An attitude of building a lasting relationship with these experts is the only way to build the same type of trust in the relationship that you expect to have with an employee – after all, we want them looking out for the company’s interest in the same way our employees do.
I am not suggesting you recruit a bunch of outside advisors. Take stock of where you are headed, understand the skill sets required to achieve these goals and develop your skills pipeline in a manner that allows you to tap into key resources when you need them.
To build our future we must invest in the present.
Identify your path to CFO success by taking our CFO Readiness Assessmentᵀᴹ.
Become a Member today and get 30% off on-demand courses and tools!
For the most up to date and relevant accounting, finance, treasury and leadership headlines all in one place subscribe to The Balanced Digest.
Follow us on Linkedin!
