Notwithstanding geopolitical squabbles on vaccine production and supply, the fight on Covid appears to be heading in the right direction. Businesses are learning exponentially and predictions about “the new normal” abound. For instance, 1McKinsey cites that more than 20% of workers could work remotely and retain effectiveness.
Two clear initiatives standout: 2the adoption of digitisation and the control of costs are essential to survive or thrive in 2021 and beyond.
How Digitisation supports rigour and benefits businesses considering liquidity events
Founder CEOs love intuitive decision-making and shooting from the hip can generate superb initiatives. When these decisions are systemically backed up with modelling from a strong data analytic CFO the results are often explosive growth. Even an Excel model, when properly generated and functioning, can reveal both unforeseen traps hidden in the detail and better routes to profit – avoiding J curves.
Strong intuition allied with endorsement by data are the hallmarks of fast growth businesses.
This form of Digitisation, when properly implemented by a CFO or FD who really understands the business, results in better-informed and fast decision making as well as better preparedness for liquidity events such as a sale, fund raising or investment.
Always being ready for a due diligence process evokes two benefits:
- The business is run optimally now
- Minimal delays in the decision making process by the investor /acquirer/funder
FDs of mid-market businesses must combine both Hands On and critical Strategic skills to drive success
In order to facilitate this the CFO or Finance Director must both have a strong understanding of the current operations of the business and the ability to understand and model fresh initiatives.
Questions to be answered include:
“Do we understand the relative profitability of our products and services?”
“How do our fresh initiatives affect bottom line and resource allocation?”
“What processes are currently manual and how can we automate them?”
‘The 5D FD’ White Paper attached underpins the importance of ensuring the FD or CFO has the right range of skills to undertake these crucial tasks.
To learn more about ‘The 5D FD’ and how Acuity Associates uses The Acuity Method™ to ensure the right skills are present in the CFO email firstname.lastname@example.org and request a call back.
1Sneader, K., & Singhal, S. (2021, January 05). The next normal arrives: Trends that will define 2021–and beyond https://www.mckinsey.com/featured-insights/leadership/the-next-normal-arrives-trends-that-will-define-2021-and-beyond#:~:text=The%20McKinsey%20Global%20Institute%20(MGI,and%20be%20just%20as%20effective.
2 Top Priorities for Finance Leaders in 2021. (n.d.). https://www.gartner.com/en/finance/trends/finance-top-priorities-for-cfos