One of the most important relationships in a business is between the company’s CEO and CFO. The CEO/CFO relationship is vital whether you work with a full-time, in-house CFO or have hired an outsourced, virtual CFO.
Your company’s vCFO helps the CEO take steps toward fulfilling your mission and reaching your goals. The vCFO can help you find the path toward growth and work with your CEO to develop a strategic plan that takes the business to the next level.
Let’s take a closer look at the building blocks of the CEO and CFO relationship.
Partners are individuals who are engaged together in the same activity. They’re working on the same goals and have the same ideas about what a business needs to succeed.
While partners work together, they don’t necessarily have the same roles. In fact, it’s better for the partnership’s success if each member has distinct responsibilities.
Your company needs a strategic plan to thrive and to take the next steps. Every business’s strategic plan will look somewhat different. The CEO and vCFO should work together to develop a strategy. Ideally, the relationship between the CEO and CFO will go one step further, allowing the vCFO to create actionable steps for the CEO to take to put the strategy into place.
A vCFO can serve as a counterpoint to a CEO. When working on building strategy together, the vCFO can act as the grounding force for the CEO. The vCFO helps to forecast and provides insight to CEOs that allow them to take the next steps or make plans for the company’s future.
All good relationships are founded on trust, and that includes that between a CEO and vCFO. Some CEOs are hesitant to trust their CFOs and may through up obstacles or boundaries.
A CFO can take steps to establish trust with a CEO, laying the foundation for a solid relationship and partnership. For example, the vCFO can deliver on time or ahead of schedule, giving the CEO the confidence that they’ll do what they say they’ll do. A vCFO can also work to build trust with a CEO being prepared for any meetings and ensuring that the appropriate information gets circulated before the meeting starts.
Finally, vCFOs can build trust with their CEOs by opening their network to the CEO. A vCFO can introduce CEOs to lenders, investors, and vendors, all of whom can help the company thrive.
Communication between CEO and CFO is a must. When lines of communication get blocked, issues arise. At the start of the relationship, the CEO and vCFO should sit together and discuss communication needs and preferences. Some CEOs want regular email updates while others appreciate face-to-face meetings or phone calls.
Having a clear path to take when issues arise is also important. The sooner problems get communicated, the sooner the CEO and vCFO can work together to solve them.
New Direction Capital’s team of outsourced CFOs put relationship building first. Hire your vCFO today to see how it works.