All of these are good indications that companies are moving forward in the changing role of the CFO and the finance department, but there is certainly more room for improvement. How do you look to make this transition that can be considered as a positive CFO model as a strategic advisor and business partner to the CEO and other business leaders?Instead of watching what happening and recording the financial impact of those events, finances and through expansion, the Chief Financial Officer (CFO) can help understand the models and challenges involved, help to make the decision to maximize and avoid decisions or avoid the associated Risk management.
Here Are Some Of The Most Important Advantages Of CFO As A Business Partner With:
• Financial Transparency And Accountability
If the CFO act as a business partner, you are guaranteed by the financial transparency. One of the biggest problems with finance and financial affairs is that few people understand. The numbers simply do not explain anything. At the same time, you may have investors and other stakeholders to say that the business is good, but what does that really mean in quantitative terms? What is good”? You need someone who knows the numbers and can explain it.
• Target Business Decisions
Similarly, your CFO can help your company make business decisions right. The functions of the CFO changed because the contributions in research and lays out provide. The EDF (European CFO) said the “CFO now has a much more central role to play in the strategy and communication with internal teams and external stakeholders.” Today, CFOs can play the role of consigliere type, acting as a trustworthy consultant and provide a vision of how the company can use its resources to achieve its goals. They know the business from inside and outside and can use this information to provide a quantified view where the company is located.
• Resource Allocation
Add your CFO as a business partner when it comes to decision-making and stakeholder relationships also has a great impact on the bottom line. Perhaps most importantly, better informed decisions that are allocated to resources where they have the greatest impact. Your CFO can see proof of what really drives the profitability of your business and make suggestions on how to maximize these efforts. This can be as simple as determining the profitability of individual projects or product lines, but it is much more than that. Your CFO can also build scenarios and propose alternative measures while maintaining the capital structure and the operational performance of the company at its optimal level.
• Cost Management
Deciding to lower costs is often arbitrary in an ivory tower, but that all changes when a CFO becomes part of the conversation. For a CFO, costs are investment, not just the cost, and each contributes to the company’s sales. With this perspective, CFOs can provide additional information that may otherwise have been lost as if they take a decision to give intuitive selective bonuses when the incomes in an attempt to motivate and retain critical employees or establish with foreign suppliers working suppliers, To minimize the long-term costs.
What It Means To Be A Business Partner
The heart of the economic company is based on the economic theory and the efficient use of limited resources to achieve financial goals.
In our opinion, the nature of a CFO as a good business partner is someone who:
• Facilitates transparency of financial performance within your organization
• Work with business leaders to improve performance
• Ensure business decisions on a sound financial analysis
• Ensure that entrepreneurial decision support processes that drive the challenge and accountability
• Provides analysis and insights to prioritize the distribution of scarce resources in the areas where it can create value
• Management of the financial function from a basis effective work, a better focus on resource analysis allows strategic and commercial operation to support to create added value