As a CFO, watching your business evolve and grow is an incredibly rewarding experience, but it
also presents new challenges to overcome to keep that growth sustainable in the future. What
worked for you and your finance team up to this point may not be enough to manage the
complexities that come with continued growth. Your own role will also evolve as priorities shift
and your responsibilities change with the nature, and scale of the business.
Here are the top 3 things financial executives need to think about as you, and your business,
move forward into the next stage of growth.
Meeting scale with scalability
Demands on the finance team change dramatically as a business scales. The complexity and
volume of transactions will increase, as will the level of scrutiny and oversight over accounting
functions from external sources like regulators, auditors, and even investors. At the same time,
you and your finance team will be called on to help prepare forecasts, budgets and other
planning materials which will also get more complex as the organization grows, and goals
change.
As a CFO of a growing organization, one of your primary responsibilities is to ensure that any
growth the company is experiencing is sustainable in the long-term. That means taking steps
today to ensure that you and your finance teams are equipped to manage much more complex
and fast-moving accounting needs in the future. In many cases, effectively leveraging
technology is the key to long-term scalability.
It’s crucial to be prepared to scale successfully across your financial and operational structures.
As you consider how you can best prepare your business for present and future growth, here
are some questions you may want to ask yourself:
- Do I have the right team in place today to manage the financial needs of the business 6 months from now? What about a year from now?
- Can the processes we use today cope with increased volume?
- Will our current systems and processes keep us efficient as we scale?
- What systems, tools and resources do we need to build permanent scalability into our financial operations?
In order to meet the new demands brought on by newfound growth, technology will play an
important role in preparing your financial operations to scale. CFO’s need to carefully review
their current technology stack, systems and processes, and look for areas they can streamline and improve.
For a scaling organization, functions like accounts payable and receivable, as well as balancing books and reconciling accounts, are areas where automation technology can be particularly impactful when it comes to ensuring your business is structurally prepared for growth. Automating these areas can help free up valuable time and resources across your accounting teams, as well as ensuring that you are able to keep a close and watchful eye on cash flow as transaction volumes increase in both directions.
Looking forward, not backward
In many ways, the traditional CFOs role has been one that spends much of its time looking
backwards – reviewing annual financial reports, tracking against compliance, and auditing
demands, comparing last year’s forecasts to this year’s results, and so on. For the CFO of a
growing business though, you will need to focus as much, if not more, on where you’re headed, rather than where you’ve been.
This doesn’t mean, of course, that the past doesn’t matter anymore – quite the opposite in fact. What it does mean though, is that as a business grows, the CFOs role becomes much more strategic in nature, with a much larger emphasis on long-term planning, forecasting and forward- looking decision making.
Rather than looking backwards merely to ensure that everything is in order, you will be spending more time looking backward to draw meaningful insights to carry forward in the future. This shift in approach is, to a degree, also informed by advances in the types of technology and systems that growing businesses are able to put in place across their financial functions.
When a business reaches a certain scale, it becomes a necessity to have a much more efficient
back-office structure, which almost certainly includes some level of automation in key functions
like accounts payable and receivable, as well as bookkeeping, and financial reporting. Having
technology in place to help streamline these functions will give you and your team much more
visibility and control over the business’ cash flow, which will allow you to glean valuable insights,
and make actionable decisions on when, and how you can invest in growth opportunities. In turn, these improved functions generate much more data and information which a CFO can then analyze for trends and insights which can be applied to future-focused decisions.
Proactively managing risk
The reality of growing a business is that the number, and severity of the risks you will be
confronted with will grow right alongside you. For a CFO at a scaling organization, you will need
to think carefully about what kinds of risks you and the business are exposed to, and more
importantly, what safeguards are you putting in place today to ensure that those risks don’t
become problems.
As a CFO, you will need to be able to anticipate risks, and take steps to protect against them
long before they ever arrive at your doorstep. This includes thinking about how you prepare the
business for things like economic uncertainty, corporate liability, regulatory change and
compliance needs, even cybersecurity.
For a scaling organization, risk isn’t something that can be dealt with as it comes; it must be
managed proactively, and strategically. Consider, for example, how you can implement
technology that can help you mitigate some, or all of these risks.
Automation technology across many key accounting and operational functions can actually help
your business mitigate risk in a number of ways. Having a real-time picture of your business’
financials, for example, allows you to take more control over the business’ cash flow, which
helps you plan budgets in the long term.
That real-time view also makes it much easier to stay on top of any financial reporting or
auditing requirements, which will help ensure that the business is meeting it’s legal and financial
responsibilities, and save you and your team significant headaches come tax season.
Technology can also be a powerful tool for protecting your business against things like fraud
and cybercrime. Modern accounting software will come equipped with advanced security
measures which can go a long way toward mitigating cybersecurity risks as well. As you explore
potential solutions for your business, make sure that the technology you choose has key
security features like:
- 2-Factor authentication
- Single Sign On services
- Routine penetration tests
- Fraud detection
- ISO certification
Of course, the best CFO in the world can’t always do much to stop economic uncertainty, but
they can put structures and systems in place to ensure that the business is stable enough
financially to not just weather periods of volatility, but actually grow when competitors are
struggling.
Use the right tools
For a growing organization, technology will play an incredibly important role in ensuring that the
company is structured to scale alongside revenue. When it comes to purview of a CFO,
leveraging automation technology to streamline core, everyday financial activities like
processing, tracking and managing payments can be a powerful way to ensure that you and
your team are ready, and able to manage that growth. The efficiencies that this technology can
create in your business will allow for faster payment processing times, and significantly greater
visibility and control over the business’ cash flow. In turn, this will help you and your team
leverage insights to drive strategic, data-driven growth initiatives and continue to push the
business forward.
If you’re ready to streamline your accounting processes, try Plooto free for 30 days. It’s an easy
way to see how much time and money automation will save your business.
