Purposeful Roles of a Fractional CFO
Updated: Sep 12, 2022
Do you ever feel like there’s a lot on your plate?
That’s how it feels like to own a business. Business owners wear a lot of hats. You handle sales, marketing, advertising, HR, finances, and so much more. But what if you could offload some of those responsibilities onto someone else without breaking the bank?
Fractional CFO is a little-known role with many misconceptions. For example, many people think that a fractional CFO as someone who steps in to take over financial operations of a company during times of trouble. While this is certainly one of their key roles, there are many other facets to this important position. Other than getting your finances under control, they can help elevate your business as a whole. A fractional CFO’s job is complex is more complex than it seems.
A fractional CFO is expected to play four diverse and challenging roles to help mission-driven companies stay afloat and remain financially healthy. It’s crucial for female founders like yourself to understand these roles to find the right person and take your business to the next level.
Here are the four main roles of a fractional CFO.
It goes without saying that your organization has assets and legal responsibilities. And these will require careful stewardship and protection.
A good fractional CFO would protect the vital assets of your company. They ensure that your business complies with regulations and identify possible risks and pain points for stakeholders. They also offer long term strategies and balances them with short term goals and needs of the company. Likewise, they communicate value to investors and close the books correctly.
But not only are they stewards for the company’s assets; they are also financial stewards. They optimize a company’s profitability by finding ways to increase efficiency, use resources wisely, and spot opportunities. Having a qualified steward would no doubt grant you peace of mind.
Fractional CFOs could help you manage the present. They are responsible for efficiently and effectively managing your financial processes. Such processes provide insights into a business, such as financial planning and analysis, cash flow, taxes, etc.
As operators, they hold many different parts of a business together. That’s why they need a firm grasp on the company’s business model and industry so you can make more informed decisions based on solid financial data. Some of their tasks as operators include:
Financial modeling and forecasting
Other financial operations
Shaping your company’s future is important to improve your business and spread your mission. You’ll need thorough strategies to do. And fractional CFOs are always front and center when it comes to strategic planning.
They help shape the company’s future and enable businesses to make better decisions. They’re also vital in providing financial leadership and aligning growth strategies with your company's mission and vision. Fractional CFOs can identify and report what areas of the company are the most efficient, which are underperforming, how to improve those areas, and how much you will need to spend—all of which are necessary to create an effective growth strategy.
Through supporting long term investments and mapping out a financial course, they can steer your business to success. But CFOs don’t stop at developing strategies; they even take it a step further by helping enable its execution.
A great fractional CFO can stimulate and prompt a timely change in your organization. They can improve your business processes and finances by reducing costs and innovating in ways that add value and stability. Moreover, they drive business growth initiatives, such as pricing, adding value, and cost effective innovations aligned with your goals.
With the right fractional CFO’s keen insights, your business could grab opportunities to tap into new markets, follow lucrative industry trends, and more!
Maximize the Benefits of a Fractional CFO
A fractional CFO could be a huge financial advantage to your business. If you’re unsure whether you need a fractional CFO or want to hire one but don’t know where to start, schedule a call with the Profit Reimagined Team.