Many middle market companies struggle with finding the right time to retain the services and expertise of a chief financial officer. Not only is timing important, but so is justification for the expense. The best indicator that a company is ready to make the move is when growing pains first present themselves. When executive leaders are being stretched too thin, it is probably time to engage a Strategic CFO. But, timing isn’t everything.
Strategic CFOs Benefit the Company
The most obvious reason to engage a CFO is to enhance your leadership team and develop a plan for a sustainable future. The right CFO will add a strategic financial function to the organization. Not only will he/she have experience in raising capital, but also at managing banking relationships – an integral part of managing growth. A CFO will also provide financial assessments and improve your overall accounting function and annual audits. Companies of all sizes deserve the benefit of having the sound internal controls that a CFO will provide!
And, they don’t stop there.
One of the Strategic CFO’s primary goals is to provide business intelligence. They will serve as your objective business and financial advisor by mitigating risk and providing invaluable business navigation and guidance. Whether dealing with mergers and acquisitions, equity/debt negotiations, or liquidations, the Strategic CFO will steer your company through all financial situations.
Strategic CFOs Benefit Stakeholders
The Strategic CFO provides existing stakeholders with an assurance that the company’s finances are in good hands. CFOs provide independent assessments and assistance through transitions, all the while serving as a consistent financial advisor – providing a sense of comfort to stakeholders with interests in the company’s success.
Stakeholders want to invest in a company whose position is to ensure sustainable competitive advantage in the long run. That is exactly what the Strategic CFO aims to do.
Build it and they will come.
CFOs also provide the company with credibility in the eyes of prospective stakeholders. Private equity firms, strategic buyers, capital providers and suppliers will all benefit from the experience a CFO brings to the table. A company with the sound leadership a CFO provides will attract potential stakeholders.
“Strategy” is the Key Word
According to businessdictionary.com, the word strategy means:
- A method or plan chosen to bring about a desired future, such as achievement of a goal or solution to a problem.
- The art and science of planning and marshalling resources for their most efficient and effective use. The term is derived from the Greek word for generalship or leading an army.
John Ball is a co-founder and the Managing Partner of SeatonHill Partners, LLC. SeatonHill provides mid-market companies with affordable financial executive leadership from their offices in Fort Worth and Dallas. For more information, visit www.SeatonHill.com