I’m shocked to see co-founder and CEO titles rank highest among those that view my posts. It makes sense given my network, but my writing is for finance/procurement or the headcount trifecta (finance, people, talent). So, today is a post for co-founders and CEOs …
The pressure from the markets and investors can feel overwhelming. There’s daily chatter about efficiency, and everyone has a copy-paste POV on how you should respond. The reality is the same as it’s always been. It’s up to you and your team to operate.
As a former finance leader, now is the time for CEOs to demand greatness from us. Challenge us, support us, and we will deliver.
There are a couple of concepts that are mission-critical to get alignment on with your finance leader:
Zero-based Budgeting (Culture) – A way to prioritize, justify, and track every critical investment (people, purchases, and projects). Ideally, this isn’t done just during planning season. The process should be engrained into your day-to-day decision-making.
Committed Forecast – There should be a high-frequency dialog around our commitments. It’s not enough to look at historical financial data. You need to know what you’re on the hook for in the future. What offers are going out? How many people have accepted offers but not started? How many reqs are open? What’s up for renewal? What’s mandatory vs. discretionary? What can we actually cut?
In your next chat with your finance leader, ask some of these questions to get a sense of where your business stands and how you can better support them:
- How do we create a culture that delivers efficiency?
- How can we improve our execution against plan? Can we target +/- 2% variance?
- What are the most important metrics to look at for profitability?
- Walk me through our process for prioritizing and approving headcount.
- Walk me through our process for prioritizing and approving purchases and projects.
- Which of our investments have the lowest or most questionable ROI?
- How lean is our org structure in terms of management layers, overlay, and G&A? What ratios do we track and how does that compare to benchmarks?
- What is our committed forecast? Are we assessing this every month? week? daily?
- What visibility do we have into over/under spending? How frequent are adjustments made?
- What % of our spend is mission critical?
- What tools do you need to better support our decision-makers?
- How can I help? :)