As business coaches, we will almost always look at the finances of the business together with the MD (or senior management team) to inform our strategy discussions. Having a strong finance director to assure us that the numbers are reliable and that the business is optimising its resources gives us much more confidence in the strategic choices being made.

Mark Nicholls, Tectona Partnership
Mark Nicholls, MD Tectona Partnership

In this guest post by Mark Nicholls, Managing Director of Tectona Partnership, Mark offers some insightful thoughts on the benefits of having a finance director, whether full-time or part-time.

Whether your business is growing or not, there will be times – pivotal moments – when bolstering your own knowledge and expertise with that of experts will make a fundamental difference to your business.

These pivotal moments can be big events – opening a new manufacturing facility, acquiring a business or taking on new funding/shareholders; or less significant – like signing a new customer or changing insurers.

Experts bring more to the business than just their skills and experience – they can be key in helping balance your entrepreneurial zest with judicious professional management. You might consider a business coach to help develop a growth strategy, drive performance improvement or enhance your leadership skills. There is also the area of finance, where expertise in the subject can really add value, particularly in times of change.

Managing Finances

It is common for business owners to keep management of the finances close to their chests; they sometimes seem reluctant to share this information with others. However, analysing the financial position of the business can provide great insight and potential for well thought through change.

As a business grows, so do the numbers. The potential for streamlining operations, restructuring, and buying resources more economically become a real possibility. It can take the trained eye of a finance director to spot these opportunities, identify wastage and, critically, ensure increases in turnover result in both increased profits and cashflow too.

This is often an onerous task when you are busy running the business; however this could be the pivotal moment when investing in additional professional resource will make a real difference.

What value could a Finance Director bring to your business?

You may be thinking that finance directors are only for big companies – it’s a popular misconception that we often come across at Tectona. Whilst employing an FD can seem like a leap too far in terms of costs and commitment, it’s worth considering how they could add value and provide a return on investment.

Let’s take a look at the areas where they can get involved, relieve you of distracting responsibility and make changes that will impact the bottom line:

  • Provide regular, more accurate and insightful Board reporting
  • Take care of fiduciary duties and compliance
  • Provide objective feedback about the financial health of the business
  • Take away financial worries so you can focus on other aspects of the business
  • Ensure your finance team are capable and properly structured
  • Provide profit and cash flow forecasts for better financial planning and decision making
  • Tighten up financial processes and reporting
  • Improve relationships with banks, accountants and auditors
  • Review use of and application of IT to streamline operations
  • Look at employment – skills gaps, contracts and remuneration
  • Renegotiate contracts with suppliers to secure better buying deals

The potential is there for making changes and improvements to your business processes, operations and financial position, whilst you still focus on your core role. Give it some thought. The sign of a good leader is someone who is aware of the options available, so that when a pivotal moment does occur – as it certainly will – you’ll be better prepared for how to take advantage of it.

About Tectona

Tectona Partnership helps business owners sleep at night by embedding one of our 15 commercially savvy finance directors in your management team. A part time solution is usually the most effective for the smaller business. We make sure you have the necessary management information and strategic insight to make informed decisions and will tell you what you need to know, when you need to know it.