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Chief Financial Officer - CFO

Chief Financial Officer - CFO. Brings Logic & Order to what would otherwise be Chaos. Functional Evolution of Finance. Cash. Language of Finance. Business Analysis. Business Planning. Business Partner. Type and Size of Business Financial Health of Business

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Chief Financial Officer - CFO

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  1. Chief Financial Officer - CFO Brings Logic & Order to what would otherwise be Chaos

  2. Functional Evolution of Finance Cash Language of Finance Business Analysis Business Planning Business Partner

  3. Type and Size of Business Financial Health of Business Personalities and Backgrounds of Senior Management and Directors Speed of Change The Role of FinanceCompany Variables

  4. 1st – Administration of Money for Company 2nd – Provide the Language of Finance as a Common Denominator (Minimal Role of CFO) The Minimal Roles of FinanceDemanded & Unavoidable

  5. Applying Financial Skills to the Broader Context of the Total Business… Current & Future as a Business Partner to General Management The Larger Role of Finance

  6. Mission of Finance • To Provide: • Value to Customers • Appropriate Return to Investors • Responsible Environment for Employees and Communities Bakane, CFO

  7. Mission of Finance • Operate in Partnership across All Units and Functions to Further Corporate Goals • Add Perspective and Match the Organization’s Needs with Capital Sources

  8. Evolution in CFO Requirements

  9. Evolution in CFO Requirements Accounting Details  Specialists  Translator  CFO of (not necessarily CPA’s) Specialists (accounting)  for  MBA’s (Senior Management)

  10. Student Start-Up Multi-Billion $ Business

  11. CFO Mgt. Principles are the Same! • Old or New Economy • Small or Large • Domestic or Multinational • Good or Bad Company

  12. External Demands Growing Amount of Required Financial Reporting (Auditing) By Government Agencies (IRS, SEC) and Investing Public (Analysts)  Strong Technical Knowledge  Need to Directly Control the Information Released

  13. CEO’s Increasingly Turning to CFO’s to: • Influence Decision Making • Craft Internal and External Strategies • Communicate to and Help Manage the Board • Manage other Functions

  14. CEO’s Increasingly Turning to CFO’s to: • Help Manage Operating Companies • Help Corporate Financial Literacy • Add Economic Value • Help Manage the CEO

  15. CFO Company Variables • Health of Company • Personalities and Backgrounds of Senior Executives & Directors • Type and Complexity of Company • Speed of Change

  16. CFO’s Intimate Interactions • Board of Directors • Audit Committee • Compensation Committee • Executive Committee

  17. Base Organization

  18. Expanded Organization Shared Services Strategic Planning Strategic Business Unit, CFO’s Information Technology Procurement SCM Mergers Acquisitions Divestitures

  19. Share Holders Board of Directors Audit Committee Civic Leaders Analysts CEO COO Major Suppliers OPCP - Presidents CFO CFO Admin. Business Partners Corp. Staff Employees Consultants Finance Employees Immense Time Consumption

  20. Setting Strategies • Corporate • Financial • Personnel

  21. Tricon – CFO Strategies: Prioritize • Reduce Debt/Re-franchise • Get to Investment Grade • Staff the H.Q. • G&A Reductions  Shared Services • Standardize & Integrate Systems for Y2K • Create a System Wide Co-Op

  22. Setting Financial Policies • Internal Control • Accounting Policies • Measurement Standards/Benefits

  23. Setting Financial Policies • Financial Administration of Business • Annual and Long Range Plans • Evaluation of Major Expenditures • Evaluation of Economic Trends • Capital Structure

  24. Setting Personnel Policies • Hiring, Training, and Development of the Finance Function • Structure and Staffing

  25. CFO’s People Focus • Structure • the “Best” Key Personnel • Working Relationships • Communications • Operating Procedures

  26. Corporate Skill Curve Leadership/ Political Mgmt. Skill Requirements Mgmt. Technical Small/Low Large/High Size/Complexity of Firm

  27. Functional Skill Curve Sr. Mgmt. Middle Entry Political & Leadership Skills Managerial Skills Multiple Tasks Technical Skills

  28. CFO Career Grid Corporate Crossfunctional International New Areas New Co.’s Manager Entry Audit Tax Acct. Cost Acct. Planning, Reporting, Investor Relations Business Analysis, Treasury Strategic Planning

  29. CFO as a Business Partner- Assistant General Manager

  30. Honesty Promise Keeping Fairness Respect for Others Comparison (Social Commitment) Integrity Teamwork & Trust Diversity Recognition Ethical Management Practice Communications Empowerment The CFO EthicsLeadership

  31. CFO Dilemma(s) • Conflict of Interests • Credibility • Integrity

  32. Becoming the CFO The Last Hurdle To CFO

  33. Lessons Learned – C.F.O. • Importance of Your Team • Functional Confidant – OM, Kennedy; YUM, Knopf • The Bigger the Ego, the More Time you Need to Manage it • Succession makes everyone Crazy

  34. L.L. – C.F.O. II • Corporate Culture is Important to Understand and Manage • Almost all are Different • Do a Couple of Changes Well. vs. Lots of Change with little accomplishment.

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