Knowing what matters
Even if you’re not a CFO, it’s a good idea to start thinking like one. Consider the sort of things that interest a CFO when managing your own responsibilities.
Thinking like a CFO means knowing your numbers, thinking long term, and looking at the bigger picture — in terms of your own work, your department, and the organization overall. Thinking like a CFO also means knowing what matters to the CFO — and understanding the financial priorities.
Manage cash flow and control costs
A CFO has four main priorities. One priority is to manage cash flow to ensure there are funds available to pay for the organization’s day-to-day operations and to finance new projects. A CFO also strives to control costs because this is an essential part of running a profitable organization.
Grow the top line and manage financial risks
The third priority is to grow the top line, by allocating resources to things that help create customer value and increase revenues. Finally, a CFO manages whatever financial risks are facing the organization.
What lies behind these CFO priorities is business organizations’ basic goal of maximizing shareholder wealth on a sustainable basis. There is no contradiction between the goal of maximizing shareholder wealth and the priority of enhancing customer value.
After all, increasing customer value usually increases shareholder wealth in the long term. Growing and sustaining customer value is a key part of a sustainable business.
Read more on Medium.com