Why every business needs a Finance Director and what a good one does

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It’s all about teamwork isn’t it?  Any organisation with any degree of complexity and growth needs a team to manage the process and maximise the results, one person cannot do everything – even in Yorkshire.

In a business context this means that as an entity grows, it will need to delegate key tasks to experienced and qualified team members.  The focus and needs of the business will determine which area the business owner seeks help in first, whether sales, operations, admin or finance.  It is, however, fundamentally true that every business must at some point seek help if it is to break through any barriers to growth.

Looking at finance in particular, it is traditional to break down finance roles into the following broad headings:

The nature of the input required means that a pyramid structure is often evident, with a number of assistants at the base and a Finance Director at the peak. The actual numbers of team members required is often driven by the volume of transactions and the complexity of the business. By their very nature many of the roles in the structure below the FD are more transactional in nature and focus on the accuracy of accounting records, essential in itself, but not enough to really manage and develop a business.

As we are focussing on the FD role specifically then, what then are the key tasks of this role and what does the role bring that the other finance roles do not?  Speaking generally, we suggest the following three main areas of expertise and input:

Strategic

 Operational

Support

The modern FD needs to be all this and more.  There are many other considerations that go beyond the pure “job description” above.  Here are some of the main ones:

There are an increasing number of set ups that provide a flexible FD services.  The best providers provide a flexible service that grows with the business. This flexible service also helps manage costs effectively, although a good FD will easily provide a greater benefit than his costs.

Finally, a personal example of a good FD in operation.

Several years ago, I worked in a business that was growing rapidly.  The key relationship was between the entrepreneurial MD and the commercial FD.  The MD hurled exciting new projects at the business every day.  The FD reviewed them all with the MD. Some were fine as they were, some were fine with more planning and some tweaking, whereas some others went straight into the bin after being created a little too late at night.  When the FD left to do other things, some of the ideas in the latter group got through and the business tailed off dramatically.

So, every business needs the appropriate input of a good FD and the role is really one of being the key, trusted, right hand advisor.

5 main things to consider:

Written and contributed by Andy Collier, Regional Director – North of England

The FD Centre Limited


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Why every business needs a Finance Director and what a good one does

It’s all about teamwork isn’t it?  Any organisation with any degree of complexity and growth needs a team to manage the process and maximise the results, one person cannot do everything – even in…

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