In today’s business world, you have to work hard to increase revenues and constantly review your costs base. Therefore, the suggestion of employing a full time or part time FD for support may not make financial sense, especially if you already have a good accountant.
However, there is one big factor you must consider. Today’s Finance Directors are striving to contribute more to organisational performance, and FDs have emerged as much more rounded, commercial and strategic business leaders than the traditional role of ‘scorekeeper’ of yesteryear.
What are the signs that your business needs an FD or FD Support?
- Lack of good data to make informed decisions • Information not provided in a clear or timely manner
- Data is always historical
- Financial reports not linked to commercial reality
- Financial processes that are cumbersome and full of duplication
- Resignation of FD financial controller or management accountant
What should the role of the FD or FD support be in your business?
The FD wears three primary hats: first as a finance expert, second as an active member of the management team, and third as leader of the finance function and team.
The key point is that the FD has multiple roles and they are working both ‘in’ the business and ‘on’ the business.
The need to get into the business and out of the back room has been a long-standing requirement if they are to add value.
The analogy I always use is that of a car mechanic who can use all the diagnostic tools he has to find out what is wrong, but he has to get under the bonnet to really find out what’s happening. The same is true for FDs – they need to get under the bonnet of the business rather than account for it behind a desk.
What makes a good FD?
According to the most recent survey by Directorbank Group the key attributes of a good FD are:
• Excellent communication skills – with the board, across the business as a whole and with shareholders and the outside world
• Wider people skills, particularly the ability to lead a high calibre team
• Commerciality and in-depth understanding of the business, its markets and customers
• The ability to support and challenge a Chief Executive
• An affinity with numbers and the ability to interpret them for others
Technical competence for any FD should be a given, and today’s outstanding FDs should place more importance on strategic awareness, commerciality, communication skills and leadership.
For more information about the Financial Director services that Aspen Waite can provide, talk to one of our trusted advisors today.