Fractional CFO services target companies who have achieved multi-million dollar revenue levels but are striving for a higher level of sophistication and need to add financial expertise to their executive team.
Often their finance and accounting team is run by a controller, accounting manager or bookkeeper who may lack the depth of experience to think strategically about the business and will likely also benefit from the leadership that professional CFO brings to the company.
The Homza CFO Value Pyramid is a visual depiction of where I spend my time with clients over the course of a typical engagement. My goal is to spend as much time as possible working with key executives but it is critical that I spend time working at all levels of the pyramid. Often, there is some foundational work that needs to be done before a company can start to move forward.
While every company is different, the following are typical focus areas:
- Create a trusted advisory relationship with the CEO and the executive team
- Meet regularly with the management team, board members, lawyers, bankers and other constituents
- Drive long-term financial planning and proactively develop a shared vision of the future
- Focus the management team on important strategic decisions that can enhance enterprise value
- Participate in decision-making that has substantial financial impact
- Set near term budget targets and goals
- Provide a focus point for monthly analysis of successes and failures through the financial review meeting
- Create a mentoring relationship with members of the finance and accounting team which enables them to raise the bar and perform at a higher level
- Resolve any foundational issues that might exist in the financial reporting process – too often, companies have a hard time staking out their vision of the future because they don’t have a realistic picture of where they are today.
Ultimately, however, it is about outcomes. The outcome goal is always the same – higher profitability and improved cash flow.