A strategy is quite a broad area that lies at the core of business decision making with a goal to enhance the value of stakeholders. Your business strategy process is not a part of daily operations and that is where an outsourced CFO can prove to be an ideal choice for quality contribution towards the strategic leadership team. For more reasons about why you should choose outsourced CFO services Mumbai or India, you can go through our old article here.
In this article, we shall focus on the key role played by an outsourced CFO (Chief Financial Officer) in Business Strategy Management.
Top Contributions by CFO to Business Strategy
A decisive factor in having a winning long-term business strategy is the ability of your company to continuously evaluate its pros and cons. And by nature, CFOs possess this unique capability to get particular number-based outcomes from most of the operational scenarios.
A CFO is at the heart of a successful strategy team that is likely to have:
• in-depth understanding of your business from the commercial standpoint
• flexible attitude towards business processes
• expertise to offer relevant financial insight on business decisions
• ability to lay out the route map for success, accompanied with potential correction action measures.
The strategy may not be the brainchild of the CFO, but, he / she could still play a pivotal role in getting it fine-tuned and implemented. So, how does the outsourced CFO contribute? In one or more ways as described under:
1.Structure development After the stakeholders, it is the CFO who has access to the most private information about your business. With such level of understanding, your CFO is able to effectively formulate the structure of the strategy.
2.Real-time Execution A strategy has no meaning till it is not implemented, and that too in the most efficient manner. Your CFO ensures smooth execution of the overall strategy, without interfering into the operations side.
3.Assessment and Reporting For the business heads or top management, the CFO will act as the comprehensive source of all information related to strategy. CFO will always be concerned with the numbers and present the real picture. A rigorous assessment will be done by your outsourced Chief Financial Officer by comparing the actual performance against the estimated / envisaged targets.
4.Reformulation Once a strategy is formulated at the start, it is not mandatory that the same will be followed irrespective of the business circumstances or expansion requirements that your firm may face in the long term future. The strategy may have to be reformulated or restructured based on different scenarios, and a CFO would be the go-to person for such requirements.
5.M&A Transactions If you foresee any Merger and Acquisition deals for your business, do not stress out considering the magnitude of that deal! A CFO will be able to handle such M&As with ease right from their involvement in the strategic thinking for that deal, to validating the deal’s key drivers and structuring the deal, to finally conducting due diligence and getting all necessary approvals.
Evaluation of Outsourced CFO’s Performance for Your Business Strategy Most of the professional CFOs are habituated to assess their growth or contribution not just in terms of your business profitability or financial metrics. They seriously consider genuine contribution made towards key strategic initiatives and significant business projects.
As a business, you need to evaluate their performance towards Strategy in terms of whether the executive council of your company could formulate a long-term picture and certain value adding insights, leading them to objective business decisions.
Hope the above information about the contribution of CFO to your team’s strategic leadership along with his / her performance assessment parameters, help you to get maximum out of your outsourced CFO professional.
At ProBizAdvisor, we specialize in offering outsourced CFO services to a wide variety of clientele, for a number of reasons including contribution to Business Strategic leadership. Feel free to get in touch for any such related requirements.