The CFO As You Grow Program
Introduction
 The CFO As You Grow Program is offered in
response to an ever growing need from clients for more advanced
financial management services. This program was designed specifically
for small, growing companies who can benefit from the skills of a highly
qualified CFO but who can't or don't want to make the full-time
investment in one. The primary goal of this program is to help our
clients manage and grow their businesses more effectively.
We like to use a car analogy to explain our approach . . .
50+ years ago, before the time of computer chips
and advanced electronics, aside from the oil and fuel indicators, often
times the first sign of a problem came when a car actually broke down.
Now-a-days cars have computerized early warning
systems or "expert" feedback systems that tell owners of any pending
problems well in advance. Some systems are even sophisticated enough to
prompt us about preventive maintenance. All we have to do is monitor our
dashboard indicators to see if we are on track or not.
Just like a car, your business needs "expert" feedback systems to tell you when things are running
smoothly--systems that warn you about pending problems and keep you on
track with preventive maintenance. Unfortunately most businesses are
still run like cars of the past, with a limited amount of information
about their company's performance. Generally speaking, the information
is limited to financial statements that are 30-90 days old.
Often times, this results with owners being
forced to make critical decisions about their company's future without
the necessary relevant information. It's a little like driving down the
road with the windshield covered up; you can see where you've been,
maybe get a sense of where you are, but not where you're going.
Our CFO As You Grow program includes a five-step
approach to help you develop "expert" information feedback systems
specific to the type of business vehicle you drive. This feedback
creates a direct link between financial and non-financial indicators as
well as how each department and individual performs in relation to your
overall company objectives.
Specifically we seek to identify, monitor, and
help you improve Key Performance Indicators relating to the four primary
areas of business, Marketing/Sales, Management, Operations, and
Finance. Under each of these headings there are specific activities
that, if fully leveraged, will optimize your company's performance.
The CFO As You Grow Five Step Program
Step #1 Comprehensive Analysis and Planning
As important as it is to know where you want to
take your business in the future, it is equally important to establish
where you are starting from. Only then, can you accurately determine the
time and resources that will be required to take you to your
destination.
For that reason, we often start by conducting a
Business Performance Review, Industry Comparisons, Benchmarking, and/or
Trend Analysis to establish your company's current level of performance.
This analysis will establish not only how your company is performing
against others in your industry, but also against your own past
performance. Information revealed in this step will serve as a
foundation for goal setting during your Planning Process.
In preparation for your Planning Process, we'll
work with you to complete a simple questionnaire that will highlight the
financial, operational, management, marketing, and industry forces that
are present or likely to emerge in your business.
The Planning Process
The Planning Process is a comprehensive
diagnostic process to determine the current state of your business, to
identify opportunities for improved profitability and growth as well as
identify any potential obstacles that might sidetrack your progress.
During the Planning session we will work with
you and your team to review your current business scenario by
facilitating a detailed SWOT (Strengths, Weaknesses, Opportunities,
& Threats) Analysis.
From there we will develop an on-the-spot Action
Plan that will integrate your present goals with any new ones resulting
from the analysis we do together. This will enable you and your team to
go forward with clearly defined and prioritized objectives. This Action
Plan will also include measurable benchmarks and a high level of
accountability for those involved with the implementation of the plan.
Step #2 Developing a Measurement System
During this process we will work together to
capture the Key Performance Indicators that are most critical to your
success. We will then establish a baseline of financial and performance
indicators relating to your current scenario. This baseline will serve
as a benchmark against which all future progress will be measured.
What it comes down to is this. . . "What You Can
Measure, You Can Manage". By identifying and monitoring the activities
in your business which have a direct impact on your profitability you'll
be in a position to improve profitability in a much more controlled and
targeted way.
This exercise is designed to identify specific
critical indicators, both from the customer's perspective and
operationally to let you know exactly where your business stands at any
given point in time.
This "expert" feedback system will keep you
informed about the performance of your company on a real-time basis.
Knowing and monitoring these Key Performance Indicators in your business
will also give you the opportunity to improve the outcome while the
game is still being played on a daily, weekly or even hourly basis.
This information also gives immediate feedback
to the team about their performance and how they impact the overall
profitability of the company. This is a critical step when developing
incentive programs for team-wide process improvement.
Amazingly, we have found "that which gets
managed gets improved", automatically, when people have meaningful
feedback about their performance.
Step #3 Financial Fluency Training
This next step involves educating your team
about the link between the financial realities of your business and
their individual and team performance. Financial Fluency Training is an
essential element in the development of an entrepreneurial mindset
within your company culture.
Many companies who embrace this philosophy do so
for the purpose of translating traditional financial measurements into
meaningful management information for each and every player on the team.
This approach addresses the question on every
team members mind, "What's in it for me?" By making your team
financially literate and translating financial measurements into Key
Performance Indicators, you'll find your team will take "ownership" of
their performance and contribute to your company as innovators and
entrepreneurs like never before.
One of the leading authors on the subject, John Case, explains it this way,
"Execution is where the rubber meets the road.
Generals, football coaches, and the harried managers of Subway sandwich
franchises know the truth: No matter how brilliant the plans, no matter
how smart the strategy, nothing gets accomplished unless people
execute."
"In business, execution is what happens (or
doesn't happen) everyday in offices and shops and warehouses and
factories, in management meetings and on the sales calls and on the
front lines. It's about what people do on the job everyday. It's what
they think about and how they work together. . . get people working
together productively and creatively toward common purposes, without too
much lost effort. All the big-picture stuff, the mission and the
strategy and everything else, is critically dependent on getting
individuals working together. "
Step #4 Designing and Establishing a "Report & Reward" System
Now that we have your team actively involved
with helping you improve the performance of your company, we need to
develop a company "Report and Reward" System. This system provides
feedback to owners, managers and team members about their performance on
a real-time basis. Exactly how much and in what form you share critical
financial and non-financial information will be unique to your company.
Step #5 Monthly - Quarterly Review
Once we've established systems to measure,
report and reward on the activities critical to your company success,
we'll then meet with you regularly to review and advise you on ways to
improve your critical numbers.
As needed we can also provide:
Financial Management Consulting
Our goal is to improve the quality of
information you have to make decisions with. Therefore, as part of our
work together, there is often a need to conduct specific analysis on
different aspects of your businesses and/or develop new information
sources and systems to help you run your business more effectively. Our
efforts in this area would, of course, be tailored specific to your
needs.
Those services might include:
- Activity Based Management/Costing
- Profit Center Analysis
- Product Mix Analysis
- Customer Segmentation Analysis
- Cash Flow Projections and Analysis
- Budgeting and Forecasting
- Employee Compensation Plans
- Succession Planning
- Merger, Acquisition, Joint Venture Planning
- Plus much more. . .
Summary
Companies that enroll in our CFO As You Grow
program do so for a minimum of one year. In our experience, it takes at
least a year of consistent, disciplined effort to achieve long lasting
results.
One of the greatest barriers to small business
growth lies in owners who can not let go of day-to-day operations for
fear things won't get done right. The CFO As You Grow Program puts "expert" feedback systems and indicators in place so owners can still
know what?s going on without having to be intimately involved with every
detail of their operation. Much like sitting at the "dashboard" of a
car - you won't have to lift the hood every five minutes to see if the
engine is still running right. This program also lays an ideal
foundation for more advanced, technology-based management information
systems that most growing companies adopt over time.
And finally, having a solid performance-based
incentive program can also help attract and retain high quality people
to your organization. These systems create a culture of measured
accountability for team members and provide a mechanism for rewarding
superior performance.
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