As you look at your business for the year ahead and start to map out the framework for executing your strategy, you may be looking to add additional revenue streams or diversify into other areas to push growth in your business. With the current downward pressure on bookkeeping and accounting, coupled with a competitive landscape, ask yourself: can you afford not to consider offering CFO services to your clients?
The firm of the future will look considerably different to what it does today and you will need to be well positioned to leverage these new opportunities.
So, what does the CFO model look like and how does the innovative and entrepreneurial CFO of 2020 execute this service offering to their clients and how can you as a practitioner start to leverage these services in your own firm to stay one step ahead of the curve?
The role
Let’s start with defining what a CFO does and how this differs from the current role of a bookkeeper or accountant.
The CFO is responsible for the financial management of the company, oversight and management of risk, record keeping and reporting. While at a fundamental level none of this has changed for the traditional CFO, what has changed is the scope and opportunity that now exists for innovative CFOs to take on a far more holistic approach to the role.
Clients want more. They are tech savvy, hungry for support and prepared to pay for it.
This is where the opportunity lies.
Having the ability to leverage our technical experience, strategic and communication skills, in a way that starts to drive real and valuable conversations around the board room, allows the CFO to have an impact across a broad range of areas such as operations, marketing, sales, people and strategy.
Couple this with the impact of technology and the opportunity to source real-time data across not just financial but operational data points, and the CFO starts to become a pivotal role within any business.
It also becomes an exciting role for any financial professional that loves having a seat at the table, and wants to stand toe-to-toe with the owner and the board to help drive strategy and change.
The modern CFO is no longer just looking back, they are a strategic thinker that has the ability to significantly impact the growth and direction of the business.
So, you want to be a CFO? Let’s have a chat about what this looks like from an execution standpoint.
While this may sound like a great space to start your advisory journey, be aware that this role sits in a slightly different arena to the traditional bookkeeper or accountant, as do the expectation and deliverables.
To be an effective CFO to your client, you need to have extra touchpoints. Yes, your pricing should then reflect this, but so should your depth of involvement in the strategic direction of the business.
It is one thing to title yourself as a CFO, but another to actually deliver on this title.
The starting point for your CFO journey with your clients should always be at the business planning stage. Take ownership of this role for your clients. Establish yourself as the driver of this process and help owners and key department heads set the framework for the strategic direction of the business.
This process not only builds rapport with your clients but leads to conversations at future regular CFO meetings that have more depth.
Why? Because you begin to understand the owners’ and key personnel’s motivations, why they are doing what they are doing and what the end game is. You start to get a feel for the industry and the space your client sits in, what opportunities are available for them and key areas that they need to address. This process gives you context and allows you to make and mold decisions based on the strategic direction of the business.
Data and technology are your friend
Data is the CFO’s best friend!
The modern CFO sits at the crossroads of finances, data and technology. Having the technical ability to understand the story the numbers are telling, and how that supports business strategy, becomes a valuable skill set in a high-growth and complex environment. Position yourself at the crossroads and establish yourself as an expert in the business.
Become the chief executive storyteller
This is non-negotiable in the modern CFO’s toolkit.
Long gone are the days when accountants were pencil pushing bean counters with zero communications skills. The modern CFO understands the value in open lines of communication across all parts of the business operations. It is in fact these conversations that tend to lead to bigger conversations and insights around the true pulse of a business. Insights that tend to highlight areas of inefficiency, tensions and also wins that enable you to feed back into management loop conversations.
Communicating not your strong point?
Then start by putting yourself out there. The more you exercise this muscle the easier it becomes. You already have the technical skills, but your communication and soft skills need to be on par.
Manage and drive the data conversation with your clients. Integrate a live dashboard that not only has a focus on the financial data, but opens up the conversation around other data points of the business and the interconnected relationships between the departments. How does the sales pipeline data interact with the marketing and financial data? What is the push and pull effect of these relationships?
Become curious!
The modern CFO focus isn’t just on the internal intricacies of the business. It also lies in the external environment – where this business sits on the competitive landscape and how it can effectively drive growth in line with strategy.
Establish a network of professionals that you can lean on when things come up outside of your core skill set. Understand that your value lies in doing what you do well, but that having nimble and experienced people around you, that you can tap into for advice, will give you depth in the CFO role.
So, is all this sounding overwhelming? Sounding like it may be too much to take on and execute successfully?
Then don’t.
I’m a big believer in collaboration and doing what you do well! Look for opportunities with CFO firms that speak the same language you do, have the same client approach and ethics. Remember to take your time dating any new potential partners and ease into it. They will become an extension of your brand and while you may share their wins, remember you will also share any negative experiences.
However, get the partnership right and you can extend your service offering and deliver real value for your clients and your bottom line.
Executing CFO services in 2020 presents enormous opportunities not only for your clients but also for your own firm. These services allow you to carve out a new revenue stream for your business and stay ahead of the curve in what is becoming an increasingly competitive environment.
Stay curious, stay hungry, stay ahead of the curve!
Sarah Lawrance, founder, Hot Toast
