Can you guess what the 3 main challenges they have to deal with are?
Fast-growing startups are in need of a proper financial action plan so that they can manage their budget and growth. CFOs are often known simply as money people, but their responsibility is much more critical and varied.
CFOs are accountable for maintaining cash flow metrics, monitoring the financial process, and responsible for dealing with investors, auditors and tax authorities. CFOs are strategic catalysts of a company’s growth.
There are various challenges and obstacles faced by a CFO while working with a startup company as they are discussed in the latter part of the article.
Traditionally, the CFO's responsibility was related to accounting and financial matters, but today it is way beyond this. They are responsible for strategic partnerships; working to meet revenue and earning goals and also evaluating technology. In public traded companies they have to think about managing bonds and stock market concerns also.
To solve this problem of overburden, there is a need to redistribute these responsibilities so that a CFO can perform their job efficiently. There is a need for self–assessment so that one can prioritize those responsibilities that add value to the company and that genuinely require the involvement of the CFO.
Earlier CFOs used to create cost structures and were the keepers of the checkbook, but now the task of controlling costs has become complicated and requires essential long-term strategies. Today CFOs are facing the problem of structuring costs to drive a specific competitive strategy and revenue loss due to growing costs.
Solving these kinds of problems requires analytical approach and diplomatic skills. There is a need for a special team to solve the matter of cash flow and connect with all the related teams of sales and marketing for the same.
Businesses have embraced technology and have achieved success driving revenue growth while keeping their workforces remotely. Companies have realized that digitalization is the future of finance so they are evolving and innovating new business models that can reap long-term benefits. Some of the new techs include artificial intelligence, blockchain, cloud-based technology, and financial management technology. But CFOs are sometimes hesitant about switching from legacy manual systems to automation.
The adoption of these new technologies and automation will reap benefits in the long run, mainly when it comes to cost-saving, and is therefore worth taking effort. There are trends of the growing acceptance of cloud-based apps in the finance sector which enables them to access faster and better computing experience and lower cost.
CFOs are looking for these automated operating systems so that they can provide more value to the finance department.
Emerging technologies, such as artificial intelligence and automation are set to support the financial functions throughout the digital transformation phase. This will include the creation of new jobs that will enhance the quality of working life.
Capila is one of such tools as well, offering you not only automated up-to-date data, but also explaining their meaning to you through the Virtual CFO service.
Interested in such solutions?
Contact us and concentrate on your growth.
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