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March 9, 2022

Q&A Blog: Why Should You Hire a CFO? With Pascal Garbani

By Trent Turner and Stephanie McNelis

In today’s competitive and ever-changing market, you often need top-notch talent on an interim or project basis to complete critical internal initiatives, optimize financial operations and maintain your strategic advantage.

In today’s interview, we sat down with Pascal Garbani, one of Bridgepoint’s Financial Operations Consultants to discuss why you should hire a CFO and how Bridgepoint Consulting can help.

Why should you hire a CFO?

Small and medium-sized organizations are similar to small ships sailing across the North Atlantic: Wave-susceptible with numerous ups and downs. They don’t have enough critical mass to smooth the waves out.

As a CFO, you provide SMEs with the gift of expectation, such as when purchasing navigational electronics for a small boat. The organization and its investors suddenly have a 20/20 perspective and can predict rather than react to what is ahead. You can’t do anything without forecasting tools and securing finance takes time – and no one will fund you unless you can demonstrate that you know what you’re doing.

In my first CFO role, the CEO stepped into my office and closed the door. He told me a few months ago that we were in a bad situation.

“I was unable to obtain even the most basic information. The quality of the reporting was appalling. Our main investor and members of the board of directors were growing impatient. It reflected poorly on both the management team and me. In response, a board member said, ‘Find yourself a good CFO. Without a doubt, it will transform your life.’”

As he glanced at me, the CEO remarked, “Pascal, I’ve got to tell you… you’ve changed my life.” That was an unforgettable experience. For the first two weeks, I established a database using the operation module to centralize product and customer information.

What qualities should you look for? What skillsets matter most for an SME CFO?

Of course, basic technical abilities and years of business experience are required. The search for the ideal combination of academics, experience, and industry knowledge, on the other hand, is exaggerated. The world moves too quickly. The ability to learn and adapt is thus the most important skill set.

Many people’s subtle skills go unappreciated. Beyond the Executives’ chemistry, the CFO must be a skilled storyteller. The CFO must relate to everyone in the organization, earn their trust, set the right expectations, and communicate. That isn’t to say you should be happy all the time; instead, avoid thinking in clichés with your employees, clients, vendors, partners, and of course, investors.

What are the things an SME CFO should focus on? What’s on the agenda in the first few months?

The CFO informs everyone that every individual has a biased view of the world and the company. The Blind Men and the Elephant is a well-known story. We all think we’re smart, and in some cases, we are, but we must recognize that we all have blind spots. Making the SME aware of this is one of the CFO’s responsibilities.

As a result, within his first few days or weeks on the job, he must meet everyone affiliated with your organization. The CFO must discover who does what and who the important players are and establish their comprehensive view of the company, including all employees (from managers to clerks), vendors, consumers, board members, and lenders. If a CFO spends their day poring through management reports, reviewing and studying financials and paperwork, it’s not a good sign.

It’s vital to remember that GAAP simplifies a small business to a few figures. It’s critical to keep in mind that GAAP reduces a tiny corporation to a few numbers. The company is more complex than GAAP requires. As a result, the CFO must communicate the SME’s strategic goal to all stakeholders. Returning to the skills that a CFO must possess. GAAP is to a small business what Google is to language translation, vital but insufficient. Beyond the mechanics of word-finding, you’ll need to think beyond the box. You must first understand the culture to communicate appropriately. The numbers must be precise, but you must also be familiar with the culture and people to understand the business.

BRING IN EXPERT ASSISTANCE

At Bridgepoint Consulting, we have the right people with the right expertise and a single vision – your success. Whether a company needs help with strategic finance, operational improvements, technology or regulatory compliance, the Bridgepoint team is ready to deliver measurable results. Get in touch to learn how we can help.