Who’s the Boss? Let’s Look at Your Options
the boss CFO COO CEO
Choosing the right CFO with the right roles and responsibilities will grow your privately held small business

 

Most companies will need a chief financial officer (CFO) of some sort, even if the title isn’t necessarily printed on a business card. Depending on the age and complexity of the company, there are different types of CFOs. By examining where your business currently stands in terms of life-cycle stage and size – from small to multinational – you can determine which type of CFO best fits your operations.

A chief financial officer (CFO) is usually considered a partner to the president or chief executive officer (CEO), with the type of partnership being dependent upon the size, complexity and life-cycle stage of the company.

According to the Hart Vida Raffo (HVR) FlowFirstTM management model, there are three types of CFOs:

 

    • CFO – chief executive officer (CFO-CEO)

 

    • CFO – chief operating officer (CFO-COO)

 

    • CFO – controller (CFO-controller)

 

The CFO-CEO

A CFO-CEO is most likely to be employed by a company in the early stages of its development. This type of CFO could be one of the founders of the company and is very actively involved in all aspects of the business – not just accounting and finance.

The CFO-CEO will typically develop the business plan along with the CEO and forge strong relationships with prospective investors such as venture capitalists and angel investors, as well as other banking and financing relationships. In this role, the CFO’s focus is on financial projections, budgets and taking the company through several rounds of funding. The CFO-CEO is versed on the amount of funding required to develop the company’s sales and operational infrastructure as part of executing the business plan.

Investment banking experience or a finance background with an MBA is typical of the CFO-CEO. As the company’s sales increase or the company reaches a certain critical size, this type of CFO may take on a different leadership or executive position within the company, usually becoming an executive board member.

The CFO-COO

A privately held company with expanding sales and marketing will often hire a CFO-COO to develop the business’ operations. The challenge faced within a company at this level is how to enhance the company’s operational integrity in order to safeguard its existing “sales flow.” This type of company often has more than 50 employees and has shown an increase in sales and profitability over several years.

The HVR management model defines operational flow as “the capability and capacity of a company to deliver products or services as planned.” As such, the background of a CFO-COO may be systems oriented and include hands-on experience with an implementation of an enterprise resource planning (ERP) system.

The CFO-COO pays close attention to key operational metrics of the company and provides the necessary system-level support to properly measure the success of the company’s operational flow. This CFO may have previously been a CIO or chief technology officer (CTO) and is often working at a privately held company where the founder or owner is the president or CEO and may not be heavily involved in the day-to-day operations of the company.

 

 

RELATED POSTS

The Art of Marketing: The Client Is King 

The Art of Marketing: The Client Is King 

Four key reasons you should always put the client first: The most important principle of any successful marketing and/or sales effort is this: The Client is King. All of the marketing channels, press, events, campaigns, advertisements and posts you’re churning out...

3 Tips on Social Networks Vital for Business

3 Tips on Social Networks Vital for Business

Social networks provide a wealth of information and the opportunity to extend your reach for very little financial investment. Your Activity in Social Networks Can Be Good for Your Business Whether by blogging, tweeting, posting, linking in or any of the other social...

Inflation’s Impact on Small Businesses In an Uncertain Economy

Inflation’s Impact on Small Businesses In an Uncertain Economy

Five ways to address operational changes All businesses are affected by an uncertain economy. Increases are only positive when they impact the bottom line. Small and medium size businesses often do not have the staying power to survive when one or more of the factors...

Video Gallery

Polls

Sign Up for the Latin Biz Today Newsletter

PR Newswire

Money

Talent/HR

Legal

Marketing

Strategy

My Unusual Path to Launch a New Business

My Unusual Path to Launch a New Business

Understanding the value of stepping away from a large corporation to build my Hispanic business This is my entrepreneurial story. Like many Hispanic businesspeople Fortune 500 companies are great to work with until they interfere with your core values. That's the...

Latin Biz Today Salutes Our Veterans

Latin Biz Today Salutes Our Veterans

Many Hispanic veterans played a vital role in protecting democracy and keeping our nation safe Today we honor veterans and active duty military personnel for their sacrifices and contributions to keeping the world safe. Here are several examples of Hispanic veterans...

Fashion

Food

Music

Sports

Innovation

Work, Life & Culture

Culture

Health & Fitness

Travel & Destinations

Personal Blogs

Pin It on Pinterest