An organized finance department translates to a strong organization

Interim executives step into companies at times of crisis. Facing challenges and solving problems is what they’re good at. Although their role is brief, they have the power to transform and bring companies out of trouble or ease a transition.

Each organization faces a unique set of challenges – some can be prevented with simple measures beforehand. In the Cerius Business Today podcast we spoke to long-time interim CFO, Bill Hegeman, who has worked in the financial sector of Fortune 500 companies. Together with leadership roles in small to mid-sized businesses, he has amassed extensive expertise managing finance department. In the episode he shared three 3 key pieces of advice for business leaders.

Meet everyone

“One of the things I do when I come in to an organization is meet with each of the people,” says Hegeman. Because by meeting everyone you’re able to identify who the good performers are and who the bad ones are. It’s a good starting point for identifying strengths and weaknesses.

The first thing Hegeman does is talk to everyone and get their opinions. To get a good idea of who’s on-board and who isn’t, he says that he asks questions like, “Who do they like working with? Who gives them the best information?”

Secondly, he determines what each employee expects from that position. He says, “From my experience, I know what the output should be for a specific position. So I then go in and talk to that person to find out what they’re producing. I also find out if is it a systems issue or is it a competency issue? And you can pretty quickly assess it.”

Through this method, Bill can filter out performance and capabilities within two weeks. He looks at who isn’t a good fit and what upgrades are needed. Most importantly, positions are reviewed where you might have a good performer but they just aren’t capable of doing everything they’re required to do.

Financial forecasting in the finance department

One of the first things Hegeman advises a business leader to do is to create a forecast of the future based on financial statements from the finance department. He says, “Have the finance team provide you with a 3 year financial view of the future; where they take and look at your plans, and build a set of financials around that. What you want to make sure is that you have the cash capacity to fulfill those needs, and if you don’t, what are you going to do about it.”

A reasonable assessment of what to expect can help business leaders better plan resources and craft strategies. Creating contingency plans for unexpected outcomes should also be considered. The first thing business leaders should do is to have the finance department put together a forecast and give them tough questions to better plan.

Engage the finance department

It is valuable for an organization to really understand what their needs of the finance department are. Just like HR or a business development department, they need to sit down and figure out what they need from the team. By talking in clear terms they make sure that they’re getting that from them.

“Make sure that your finance organization is engaged with the entire organization,” advises Bill. “One of the things that I found in some organizations is that the finance department hasn’t been given its due. People don’t respect them, and therefore they don’t get the answers they need to provide financials. Conversely, the finance department can’t help them be successful.”

The most critical team to have on your side is finance. When that is off balance, it can put the entire organization off balance. So be clear of what outcome you need and work backward from there.

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