The Dual Roles of a Part-Time CFO

If you are a Certified Gazelles Coach, an Entrepreneurial Operating System (EOS) implementer, or some other executive business coach, I almost envy you.

In contrast, the part-time CFO for small businesses has one of the most difficult consulting roles on the planet. You read this right.

They don’t serve one, but two vital roles. The roles are similar, but doing both can greatly hamper the progress of the strategic CFO.

Thinkers and Doers

Let’s forget titles for a minute. Instead let’s talk roles and mindsets instead. I’m going to focus on mid-sized businesses for now, then I’ll circle back to small companies.

In the accounting and finance function, there are Thinkers and there are Doers. One plans and conceptualizes the work. The other finishes it to near perfection. One is not more important than the other. Both are necessary and possess unique talents to carry out their respective job requirements.

There’s also the work in between. There are project managers who help to oversee projects. There are the analysts who observe performance looking for both positive and disturbing trends. Feedback or advice is subsequently provided.

When tightly-knitted together, there’s nothing this foursome and their teams cannot accomplish. Nothing.

So here’s the $64,000 question. While mid-sized businesses can afford the resources to fulfill these vital support roles, guess who provides the Thinker-Doer roles in small businesses including the work along the fringes (project management and analysis)? You got it, the part-time CFO.

The probability is low that the small business employs a degreed accountant let alone a seasoned, certified bookkeeper. That means the part-time CFO cannot delegate Doer-type work. She/he has to be both the Thinker and the Doer. Oh yes, project management and analysis too.

Easy-peasy? I think not.

The Name Game

I’ve been using this Thinker-Doer mental model for years, and not just in the accounting and finance function. The mental model applies everywhere in the organization.

But in the accounting and finance function, I view the Thinker as the CFO and the Doer as the Controller. Is there overlap? Of course, yes. But one generally lives above the line, the other below. And to be clear, this is not a class system. It’s just a way to delineate roles.

If you find the Thinker-Doer mindset confusing if not puzzling, then you’ll certainly understand the oft-written CFO-Controller comparison.

You call yourself the part-time CFO, but in the early going of a client relationship, you are as much or more controller than CFO. And that’s what makes the role of the part-time CFO challenging. You’re not a one-role professional. You’re a multi-faceted MVP.

The CFO-Controller Comparison One More (Last?) Time

I wish I could take a show of hands asking how many times you have read about the CFO-Controller comparison. Perhaps one too many times?

Do we need another? Sorry, I’m doing it anyway. Take a look:

Are the comparisons fair? Just?

These are not blanket-statement descriptions. There will always be overlap. My list falls under the category of broad generalities. For organizations where there are two roles, the above distinctive behaviors generally surface (there’s that word ‘generally’ again).

The bottom line, when you serve small business CEOs, you are budget-driven and FP&A-driven. Keeping one hand on mid-term strategy but ensuring day-to-day operations are humming along is both tricky, yet necessary. Can one truly be creative and pragmatic at the same time? You don’t have a choice.

My Number One Coaching Tip For Handling the Dual CFO-Controllership Roles

I’ve worked with nearly 125 different businesses and nonprofits since 2001. All have had one thing in common–poor accounting and finance functions.

None of the following were present:

• A 2-3 day, timely and accurate close
• Meaningful financial statements
• Reliable metrics of any kind closely tied to specific objectives for the current year
• An effective, daily treasury management system
• Strong internal controls
• A simple cash forecasting process
• A financial model with 7-8 key drivers allowing for simple stress testing of the business
• A coherent, integrated marketing, selling, and operations plan
• A system for hiring A-type players along with structure and training for existing team members

I could go on, but I’m running out of space.

Most of the bullet points above are quick fixes. In the case of the 2-3 day financial close, that can be taught in a few days. New financials can be designed in a week. Internal control weaknesses can be identified quickly and resolved within the first 2-3 weeks.

See the trend here? These controller-centric tasks can be tackled within the first 4-8 weeks of any new engagement. For every bullet point, you have the capability of turning these into repeatable, scalable, and trainable activities.

Accordingly, my coaching advice is to focus on the controllership-centric work first. When done, hire an accountant for the CEO to maintain/manage those systems and processes you have implemented. Don’t want to let this go? Then buddy, you’re in the wrong job.

Or are you saying the CEO doesn’t want to commit to this new hire? Then she is not serious about scaling or building a more valuable business. Isn’t that the goal?

You survive the dual roles of CFO and Controller by addressing and fixing the serious accounting and finance limitations ASAP, then delegate. Then you can start focusing on your CFO duties.

You manage the dual roles separately, not simultaneously. That’s how you maintain your sanity.

What do you think?