The current macroeconomic environment renders bold and swift decision-making a necessity – either for survival or to flourish. When there is relative stability the same boldness is required and it is the CFO / Finance Director who must provide the case for action when the status quo seems the easiest option.
1McKinsey’s research for the report “In Conversation with the CEO” has revealed that CEOs who make bold moves achieve significantly higher performance both in their capacity as CEOs as well as in the performance of their businesses.
How can the Finance Director / CFO empower Founder CEOs to take the tough decisions?
An understanding of both the internal tolerances of the business and the macroeconomic factors affecting the market frame the exposition of clear rationale and modelling around the options. A “bold” option is only reckless when the implications on cash and profit are not at the heart of the decision.
CFOs and Finance Directors must have the skill set to both understand both the internal machinations as well as the external market facing a business. Harnessing this knowledge allows scenario planning to include bold moves in a controlled manner.
Questions to be answered include:
“What are our options now, what is the cost and how do they impact cash and EBITDA in the medium term?”
“What acquisitions could we make in the emergence from the pandemic and how would we fund them?”
‘The 5D FD’ White Paper attached underpins the importance of ensuring the CFO is right-skilled and able to deliver the right level of strategic advice, underpinned with hard data.
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.
1In conversation: The CEO moment. (2020, October 16) https://www.mckinsey.com/business-functions/strategy-and-corporate-finance/our-insights/in-conversation-the-ceo-moment?cid=other-eml-alt-mip-mck