{"id":875,"date":"2019-11-23T10:31:22","date_gmt":"2019-11-23T14:31:22","guid":{"rendered":"https:\/\/www.saudercpa.com\/blog\/?p=875"},"modified":"2019-11-23T14:18:41","modified_gmt":"2019-11-23T18:18:41","slug":"skills-every-chief-financial-officer-needs-segment-1","status":"publish","type":"post","link":"https:\/\/www.saudercpa.com\/blog\/2019\/11\/23\/skills-every-chief-financial-officer-needs-segment-1\/","title":{"rendered":"Skills Every Chief Financial Officer Needs (Segment 1)"},"content":{"rendered":"

Preface: Where did you begin? Where are you today? Where do you want to be in the future?\u00a0What\u00a0effectuation\u00a0will be necessary so\u00a0you will be there? Every enterprise CFO needs to ask these questions that\u00a0will lead to an more accurate assessment of strengths, weaknesses, opportunities, and threats.<\/em><\/p>\n

Skills Every Chief Financial Officer Needs\u00a0 (2015)<\/strong><\/p>\n

Credit: Donald J. Sauder, CPA | CVA<\/em><\/p>\n

The role of a\u00a0chief financial officer (CFO), requires an ever-increasing need for the ability to make great financial decisions. Here are a few skill sets you should look for when hiring a CFO, and which your CFO should be encouraged to continue\u00a0developing expertise in.<\/p>\n

Strategic Thinking.<\/strong> A CFO should have the skill to help achieve the strategic vision of the business, a map of the business purpose, objectives, and strategy, with steps necessary to achieve that vision. Creating a vision, plan, or strategy on paper is not that difficult. Yet even a realistically achievable plan is challenging, when working to implement it. You need decisive acumen on your team. You need its leader, the CFO, to take action, to keep believing in the vision, and work tirelessly towards the achievement of that vision.<\/p>\n

Courage to Question.<\/strong> \u00a0 With strategic thinking skills, your CFO should have the expertise and experience to evaluate your business.Where did you begin? Where are you today? Where do you want to be in the future? This will lead to an assessment of strengths, weaknesses, opportunities, and threats. Your CFO needs to think through outcomes, while at the same time making necessary adjustments in working the plan when changes in the marketplace warrant it, such as adapting to new market conditions, innovations, opportunities, and risks. Like Jack Welch, who lead GE from a $4 billion to nearly $500 billion, says, \u201cWhen it comes to strategy, ponder less, and do more.\u201d The key is do more of the strategic. What is strategic? If you don\u2019t want to answer that question, your CFO certainly better have an answer. Typically for entrepreneurs, the same strategy that got you from zero to $5 million in revenue (the typical sales volume when small businesses begin to think about hiring a CFO), won\u2019t take your business to $15 million. You will probably place significant reliance on your CFO when working through strategy. Whether or not you\u2019re a strategic entrepreneur, your CFO needs to be strategic.<\/p>\n

You need your CFO to not only ask the right questions, but address them. He should have the courage to ask questions like, will the vision and strategy meet our objectives? Can we successfully implement the strategy? Is the strategy consistent with core values of the business and the culture of our clients? Does the business have the resources\u2013financial capital, intellectual capital\u2013to succeed in implementing our plan? Can we clearly envision and communicate the strategy to our employees?<\/p>\n

Business Risk Planning.<\/strong> A CFO should have experience and expertise to work to identify inside and outside business risks with team discussion among company personnel. Your CFO should quantify and assess these identified risks and likelihood of the risks occurring. The risks should then be prioritized with regard to their probability and impact. Monitoring the risks should be assigned to a specific person for periodic review. As importantly, strategies for lessening the effects of those risks should be developed. Your CFO will need to balance strategy implementation with the associated risks. Sixty percent of increases in business value is built from revenue growth, so an understanding of risks in the marketplace will improve calculations on your business\u2019s mineral vein.<\/p>\n

In the summer of 2010, the multinational professional services firm Deloitte published a paper titled, \u201cRisk Intelligent Decision-making: Ten essential skills for surviving and thriving in uncertainty.\u201d The paper on risk management shows where things go wrong. This report names the following as top risks: 1) Relying on false assumptions, 2) Failing to exercise appropriate vigilance, 3) Tending to ignore velocity and momentum, 4) Failing to make key connections and manage complexity, 5) Failure to imagine failure, 6) Placing reliance on unverified sources of information, 7) Not maintaining adequate margins of safety, 8) Focusing only on the short term, 9) Failing to take enough of the right risks, and 10) Having a lack of operational discipline.<\/p>\n

Read and act on these ten items each month, and your business will probably be in the top 10% or 15% of small business risk managers. Other risks include shortages in capital, supplier quality or concerns with timeliness, processes that are too complex or result in ineffective quality, inability to meet customer demand, human relations issues such as finding the right people for key roles, and the list goes on. These are the kinds of risks a CFO needs to constantly monitor and evaluate, finding strategies for managing those risks.<\/p>\n

To be continued<\/em><\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

Preface: Where did you begin? Where are you today? Where do you want to be in the future?\u00a0What\u00a0effectuation\u00a0will be necessary so\u00a0you will be there? Every enterprise CFO needs to ask these questions that\u00a0will lead to an more accurate assessment of strengths, weaknesses, opportunities, and threats. Skills Every Chief Financial Officer Needs\u00a0 (2015) Credit: Donald J. … Continue reading “Skills Every Chief Financial Officer Needs (Segment 1)”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[1],"tags":[],"_links":{"self":[{"href":"https:\/\/www.saudercpa.com\/blog\/wp-json\/wp\/v2\/posts\/875"}],"collection":[{"href":"https:\/\/www.saudercpa.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.saudercpa.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.saudercpa.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.saudercpa.com\/blog\/wp-json\/wp\/v2\/comments?post=875"}],"version-history":[{"count":3,"href":"https:\/\/www.saudercpa.com\/blog\/wp-json\/wp\/v2\/posts\/875\/revisions"}],"predecessor-version":[{"id":882,"href":"https:\/\/www.saudercpa.com\/blog\/wp-json\/wp\/v2\/posts\/875\/revisions\/882"}],"wp:attachment":[{"href":"https:\/\/www.saudercpa.com\/blog\/wp-json\/wp\/v2\/media?parent=875"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.saudercpa.com\/blog\/wp-json\/wp\/v2\/categories?post=875"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.saudercpa.com\/blog\/wp-json\/wp\/v2\/tags?post=875"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}