Does your business have a Navigator? I hope so or you could be headed for serious trouble. On the other hand your business may be safe. Here is the problem. You don’t know without a Navigator. Why is a Navigator so essential? Navigation is a “field of study that focuses on the process of monitoring and controlling the movement of a craft or vehicle from one place to another. A Navigator is the person on board a ship or aircraft responsible for its navigation.” Now, read carefully the following paragraph.
“The Navigators primary responsibility is to be aware of ship or aircraft position at all times. Responsibilities include planning the journey, advising the Captain or aircraft Commander of estimated timing to destinations while en route, and ensuring hazards are avoided (Wikipedia, 2012, emphasis added).”
Obviously, using the above analogy, the Captain or Commander of a business is the CEO/Owner. Who then, is to be the Navigator? The key person for this critical position is the CFO (Chief Financial Officer). The CFO’s duties and responsibilities for a company are complex and varied thus too long to analyze in this article. However, three major similarities between a Navigator and CFO are very apparent as follows:
- Primary responsibility to be aware of ship or aircraft position at all times- A CFO’s first priority is to know the exact financial position of a company at all times. This is done by ensuring the key financial statements (Balance Sheet, Income Statement, and Statement of Cash Flows) are timely and accurate. A CFO knows the financial statements in detail and uses information from these financial reports to inform the CEO of the company’s financial condition.
- Planning the journey- A skilled CFO should know the goals (short and long term) of the business. Planning how to best achieve these goals involves many areas. For example, a CFO prepares cash flow forecasts to ensure sufficient cash will be available at critical times to keep the company liquid and able to take advantage of investment opportunities along the journey. A CFO is heavily involved in business planning and budget preparation so resources can be allocated intelligently to assist the company in achieving its goals.
- Advising the Captain or Commander- Advice from a CFO is crucial to a business owner. The advice comes from a seasoned professional with years of experience grounded in financial acumen. A good CFO has the backbone and objectiveness to make the CEO aware of weaknesses within his company, any dangers ahead, and the steps to get the business back on course.
This is Why Every Company, Regardless of Its Size, Needs CFO Services. You can now afford them with B2B CFO®.
*Wikipedia. Retrieved September 4, 2012. (emphasis added)