A capable Chief Financial Officer (CFO) makes strategic financial decisions that contribute to a company’s success. However, most small businesses do not have the financial capability to hire a full-time CFO. This means they have to work with one on a part-time basis. To ensure you get the most out of your CFO, David Johnston, a former CFO, explains a few do’s to keep in mind.
Share the Company Strategy and Engage as a thought Partner
Your CFO is not just your worker but your partner as well, even though indirectly. So be open to sharing the company’s strategy with them. As a thought partner, your CFO will share some good ideas and experiences that can help steer the company forward. Undoubtedly, CFOs are more knowledgeable when it comes to matters of finance and mitigating risks. They will tell you why a certain strategy is not working and how it can be modified to bring in more profits.
Have Them participate in Board Meetings
The main reason you should allow your CFO to participate in board meetings is that they are responsible for the company’s financial decisions. David Johnston in Massachusetts says that including the CFO in board meetings can foster financial transparency. Plus, when discussing financial issues such as mergers and acquisitions, you need an experienced person to advise you on whether it is the right move and how it will impact the company.
Understanding Their Strengths and Areas of Lesser Strengths Before Hiring
Another way to get the most out of your CFO is by knowing their strengths and weaknesses. No one is perfect in all ways. In some areas, one will fall short. Understanding this can guide you in deciding whether to hire or dismiss a candidate. For instance, say that your potential CFO does not work well under pressure but compensates in that area by having great financial acumen. Is that something you can compromise? Knowing the strengths and weaknesses of your CFO allows you to know which tasks to allocate and how to do that.
Have Realistic Expectations
‘It is important to have realistic expectations from your CFO, depending on where the company stands at the moment,’ says David Johnston, a former CFO. A financial turnaround takes time. Just because you have not seen changes in the first two weeks does not mean your CFO is not working. Being patient as long as there is progress will foster a good relationship with your CFO.
Understanding That the Part-Time CFO Is Balancing Multiple Constituencies
Your part-time CFO is not just working for you. They have other engagements. Do not expect them to just drop everything for you whenever you want them. If you need them, but they are held somewhere else, be patient as they will get back to you.
Try to Set Schedule Meetings and Keep to Those Times
Also, related to the initial point, your part-time CFO has other engagements. So schedule meetings where you will get advice or feedback and ensure you stick to the stated time to avoid inconveniencing both of you.
As David Johnston has highlighted, you will get the most out of your working relationship with your CFO if you follow these tips. Understand that you may have a limited time with your CFO, and so every second should count.