4 Essential CFO Functions
Do you really need your CFO to be involved in the sales cycle? Yes, because their job is rapidly becoming about more than reporting. Some even dip their toes into HR! CFO services make your organization more valuable to shareholders, increase your ROI, and improve internal and external relationships. They do this by filling several functions:
1. Risk Management
Your business takes major leaps each day. A CFO eases anxiety by managing the unknowns. Importantly, CFO services can inform sales representatives about acquisition costs, all while taking steps to:
- Identify risks.
- Evaluate the market.
- Secure contracts.
- Define customers’ credit limits.
But your CFO also just wants to see the business thrive, so they implement procedures using company resources to fuel your growth. It may be uncomfortable at times, but they push you by challenging existing sales processes, optimizing them, and using metrics to manage them so they remain effective.
2. Sales and Growth Management
The sales team needs to be aligned with the finance team to pursue company goals. CFO services understand how to capture your market, so they work with you to deploy strategies to drive growth and profitability.
A big piece of this is your marketing efforts. Are you using outbound, inbound, or account-based marketing? Your CFO can identify gaps between sales and marketing to develop strategic plans. They’ll set performance targets with cash flow in mind. But that doesn’t necessarily mean reinventing the wheel. They’ll also help you hone in on what’s working and foster sustainable sales or long-term business relationships to both retain customers and save on acquiring new ones.
3. Invoicing and Payments
Saying to a customer, “Hey, you owe me money,” is always a little awkward. But CFO services manage invoicing and late payments effectively.
Your CFO starts by optimizing invoicing to reduce disputes. This could include using processes to:
- Collect customer information.
- Generate invoice reminders.
- Automate documents as payments are received.
But what about invoices that are stuck in limbo? They’ll also make it easier to collect late payments on overdue invoices, using communications such as reminders and notices to pay.
The delicate balance is that you need to be paid for your products and/or services but can’t rub customers the wrong way. CFOs strive to meet your needs and maintain business relationships.
4. Internal Communications
Many companies have a great divide in communication. Employees learn important news at the eleventh hour—or not at all—so they don’t understand the what and why behind your decisions and activities. CFO services can help you foster open, real-time communication across your business instead.
For one thing, they’ll help you share your financial strategy so the money side of the business makes sense across the organization. This can widen the cash flow culture among employees, helping the business uncover opportunities or challenges.
But the CFO also ensures the organization understands the need for appropriate controls. After all, you need to adapt to avoid financial and reputational risk—and that could impact anyone in the business.
Why Having a CFO Is Crucial
On any given day, you’re focused on executing key tasks, managing employees, and making customers happy. And you can’t be your best at any of the above and have your hand in making the biggest business decisions. A CFO is your right-hand partner, dedicated to helping with:
CFO services know when and how to cut costs to sidestep cash flow problems and optimize for profit. This might involve managing compliance with local and federal employment laws if you need to downsize. But at a base level, your CFO leans on a few strategies, including:
- Cash flow forecasting, to help you understand what could happen in the future based on the decisions you make today
- Budgeting, including solidifying your budget and measuring it against your performance
Want to identify opportunities to spend effectively and further your business goals? Your CFO can get the ball rolling with variable and fixed expense reporting and continue on to objectively create strategies based on your business capabilities and resources.
CFO services use financial data to influence decision-making and strategy. To this end, your CFO will weigh in on strategy and prioritize and ensure that strategies can be funded. They also foster transparency as you make key moves, communicating strategies and progress to stakeholders and investors who need to understand the business.
Growing the Business
Startups, medium-sized companies, and large corporations have vastly different needs and goals. No matter where your business is, a CFO helps you navigate any growth phase.
They might set the stage for growth by conducting product line/regional profitability analysis and benchmarking against industry peers.
On top of this, as you grow, your staffing needs change. CFO services pave the way for you to transition from their expertise to an in-house executive.
Simplify Sales and Business Growth with a CFO Partner
Stop pulling your hair out. Trust a CFO to tackle heavy-hitting roles ranging from risk management to communications. CFO services work with you to strengthen sales and make strategic decisions to propel growth.
Looking to make your next move? See how Ignite Spot can support your business with expert CFO services.