Virtual CFO

Think of a business as a bicycle. The bicycle has the following three elements:

  1. Front Wheel – Sales and Marketing. This function is responsible for finding customers and helping them buy the company’s products or services.
  2. Back Wheel – Production. This function is responsible for delivering the products or services the customers buy.
  3. Frame – Management. It has two functions. First is steering the bicycle down the path it should go. Second is control or keeping the organization running smoothly (both wheels moving in the same direction).

The leadership responsibilities are primarily the job of the Chief Executive Officer (CEO). Control is the job of the Chief Financial Officer (CFO).

In the past, the small business owner tried to perform both the roles of CEO and CFO. However, both roles are extremely hard to perform simultaneously. When the executive takes his eyes off of the horizon and starts to focus on the internal control issues the business loses direction. However, without attention to systems and processes, the company will begin to wobble out of control.

A “virtual CFO” is a new adaptation to an old concept. It is made possible by advances in communication technology. The virtual CFO does the same job as any other CFO with one difference – they are not on site. Rather, the virtual CFO stays in contact and maintains control by using powerful tools made available by advancing technology – from anywhere in the country.

How do you benefit by using a virtual chief financial officer (CFO)?

Not every company is a candidate for a virtual CFO. If you have a large company with complex reporting and control needs, you will likely need a full-time CFO. But if you have a smaller company, you can receive a number of the following advantages:

  1. You save money. Since you are only using a fraction of the time of the professional CFO, you save money. You are able to fill the position with the caliber of a professional your business requires but at a third to half the cost of a full-time employee.
  2. You gain flexibility. The virtual CFO’s services can be adapted to your needs. As those needs change, you can change the level of service you receive. You may need the CFO on site a good portion of the time while you are establishing controls and creating systems. When that work is done, you can scale back your need. With a full-time employee you have him on site and on the payroll even when he has to fill his time with very low value work.
  3. You have access to more experience and skill. A virtual CFO will generally come to you with much more experience and skill than you can afford if you have to hire someone full-time. You have access to the training, perspective, contacts and know-how of a professional with many years experience, but at a price you would pay for a bookkeeper or new accountant.
  4. You have the advantage of independent perspective. As CEO the one thing you need in a CFO is someone who can see what is happening and tell you the truth. It doesn’t take long for full-time employees to realize they are in a political environment and their job, progress and future are dependent upon how you and others within the company view them. This can’t help but diminish the independent perspective that is so valuable to you.
  5. You have the power of a mediator. Since the virtual CFO is not jockeying for a position in your company, he has a much easier time getting cooperation and help from people who may try to block the same effort coming from another employee who may be viewed as a competitor to future promotions.
  6. Your solutions come faster. The virtual CFO has likely seen the same problems you are facing many times before. He comes ready to solve the problems and you get results much faster.
  7. You have less risk. Since the virtual CFO is not an employee, you can terminate the relationship if it doesn’t serve you well. It is clean and simple and there are few feelings to cloud the issue. Terminating a key full-time employee can be challenging, expensive and emotionally draining.
  8. You get fresh ideas. Because the virtual CFO is working with multiple clients, he is being exposed to many different ideas and solutions. You benefit from that exposure by having a constant influx of fresh ideas for solving your problems and profiting from your opportunities.

So how do we get started?

Give me a call at 402-658-7340 or drop me an email at info@commonsensecfo.com. There is no cost or obligation to discuss your situation and the strategy I would implement to help you.

When deciding whether or not to contact me, here’s a few things to consider:

  • I won’t service companies whose products or services are incompatible with Scripture. I also won’t serve companies that take advantage of employees or vendors or are bad citizens in their community.
  • Is your business committed to principles of honesty and integrity? Companies that fudge the numbers, mislead customers or fail to honor commitments are not good candidates for my service. This isn’t just a moral issue – honesty is just good business.
  • Is your business model viable? If the business model is flawed beyond repair, I won’t get involved. I need to believe the business has a legitimate chance for profitability and success. However, just because your company may be unprofitable and in deep financial trouble doesn’t necessarily mean the model is flawed. I’m not afraid to get involved with troubled businesses (I believe God’s business principles can transform your unprofitable business), just those that have a flawed business model.

4 Comments (+add yours?)

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