When you hire a Virtual Finance Director (VFD)
, part of their remit will be to assess the past and present financial performance of your company. But where they truly shine is in helping you plan for the future. A VFD should be tasked with evaluating the efficiency and profitability of your company, and reporting back on how you can capitalise on this information moving forward. This should include forecasting and scenario planning to predict the state of play where your market – and the wider economy – is concerned. In short, a VFD can act as the strategist
and the catalyst
for your company’s future success. Here we take a quick look at a few of the ways they do just that.
1. Objective Insight, Analysis and Guidance
VFDs shoulder a whole host of responsibilities, providing an effective and efficient finance function for your growing business. And not only do they keep an eye on tax, cash flow, income, expenses and more, they also help you better understand your numbers within the context of present and future performance. By providing a level of objective insight, VFDs can uncover opportunities, pinpoint obstacles, and identify threats far in advance. Their input also allows a more proactive approach to business planning, making sure that you’re allocating capital to the most profitable initiatives. What’s more, a VFD won’t be slow in challenging your priorities and assumptions. They’re on board to keep your business from flying by the seat of its pants. While your gut may have served you well in the beginning, to effectively plan for the future requires careful analysis.
2. Strategic Planning
A Virtual Finance Director has a major role to play when it comes to planning for and influencing the future direction of your business. They might not always be a physical presence at the planning table, but it’s important that their voice is heard. They will work closely with you to align your goals and aspirations with an overall financial strategy designed to keep your company in pursuit of its growth milestones. By forecasting cash flow and undertaking economic and political analyses, you can be sure that your growth strategy is underpinned by sound financial thinking – and at least a few contingencies.
3. Instigating Change
You simply can’t underestimate the importance of strong financial leadership when it comes to planning for the future. By letting your VFD hold the purse strings, they can drive the sorts of business improvements required to meet your goals. This can involve increasing prices, cutting costs, improving process efficiencies, and so much more. A VFD will put your business on a sure financial footing to help make the next steps as straightforward as possible.
Finance Directors don’t have all the answers. No VFD worth their salt will claim to be clairvoyant. And if they ever show up to a face-to-face in a DeLorean, well, they’re just showing off! But as a strategist, a Virtual Finance Director can flag the potential fallout of political and economic turmoil long before it reaches the front pages (Brexit, anyone?). And as a catalyst, a VFD can help you instigate change to avoid obstacles and keep you on course to meet your future business goals. Now, doesn’t that sound like someone you’d like on your team? If you’re ready to plan for the future with a VFD, book a discovery call today and find out how Square Mile Accounting can help you.