1.   TOP TEN 2010 TRENDS FOR ENTREPRENEURS - We received a lot of very positive feedback on this blog post as well as a radio interview request.  Listen to Ken Kaufman’s radio interview HERE.

2.   CFOs ON TWITTER - This blog post was updated throughout the year as we met more CFOs on Twitter.  Yes, there are some CFOs that have not only engaged in social media, but who are also pretty good at it.

3.   STAFFING THE ACCOUNTING/FINANCE DEPARTMENT IN START-UPS - This post offers insight into how a start-up should scale into its accounting/finance department.

4.   I CANNOT PREDICT THE FUTURE – BUDGETING IS WORTHLESS! - Predicting the future is actually easier than most think, and what you learn in the process makes the whole experience invaluable.

5.   WORKING CAPITAL – LESS IS OFTEN MORE - A different twist on cash flow management and liquidity improvement techniques.

6.   KEY BUSINESS METRICS EVERY ENTREPRENEUR MUST KNOW - Dashboards and business intelligence are becoming more critical for entrepreneurs.  Here is a roadmap for how to get started.

7.   HOW TO SPEND $195 INSTEAD OF $30,000 TO FILL A NEED - We received a lot of personal attention to this blog post – This gives us some insight into one business lesson learned from a family vacation.

8.   THE PROBLEM IS… - Be a problem solver, not just a problem finder.

9.   3 REASONS YOUR QUICKBOOKS STATEMENT OF CASH FLOW IS WRONG - Some technical information, but very necessary to understand if you are using QuickBooks.

10.  DOES TOO MUCH CAPITAL & SUCCESS TOO EARLY HURT START-UPS? - Interesting thoughts on what each business learns in its early bootstrapping days!

All the best for a prosperous 2010!

Consider the well-documented battle between Microsoft and Apple: Although Apple had the better product, it has held only a 2 – 4% share of the personal home computers market, while Microsoft (in conjunction with IBM) has held well over 95% since the 90′;, and has only just recently announced it had captured 8.8% of the market.  I would argue that although Microsoft produces an inferior product, it has continually beaten Apple by effectively managing its business.

Good management does not always include hiring full-time staff that require large annual salaries and benefits.  Many business owners have discovered they can have great talent to meet their managing needs, but not have to pay entire salaries by outsourcing certain managing needs.  Hiring a part-time CFO is a key management position that often does not require a full-time commitment by the company.  A part-time CFO helps fill the needs of a growing company by helping lay a solid foundation for growth and can be a great asset to any management team.  Regardless of how management is filled it is important to recognize that in many cases good management can be the difference in making a successful business.

WAITING TOO LONG

The right time to hire a CFO consultant is a function of three variables: complexity, steepness of growth/shrinkage curve, and size. When it comes to complexity, every business reaches a point where no one person, even the founder or CEO, can keep all of the details of the business in their head. This requires the development of systems and infrastructure to empower the leaders and mangers of the company to make the right decisions. A qualified CFO has dealt with much more complexity in their career, and building these reporting and tracking systems and helping management make the right decisions should come as naturally to them as riding a bike.

A small and stable business will often survive without a CFO. The challenge with this premise is that most businesses do not want to remain small and, in our competitive economy, business stability is almost extinct. Rapid growth requires an overwhelming amount of time and resources. When a company I worked for unexpectedly grew from $30 million to almost $50 million in annual sales in just twelve months, we effectively outgrew every process and system designed to organize the business efficiently and profitably. We had to break almost everything and then re-build it to scale. This is also true of companies that are shrinking and downsizing. These companies often hang on to too many systems and too much overhead for too long, which can ultimately bury them. An experienced CFO will be a key resource to help any organization succeed through the volatile cycles of business.

What size should a company be to begin considering adding an outsourced CFO to their team? Any company at or approaching $1 million in annual sales should be thinking about it. In addition, start-up and pre-revenue companies can often significantly benefit from the assistance of a senior-level executive.

If you wait too long to hire a part-time CFO, your costs and frustrations will be greater than adding this critical player to your team at the right time.

LACK OF EXECUTIVE VOICE AND INFLUENCE

Let’s be clear about who should fill the part-time CFO job. This person should have formal education (with graduate education and/or professional certifications preferred), more than a decade of hands-on senior-level executive experience, and have access to tools, resources, and networks that the existing management team does not have. The decision to bring a qualified person on board should be coupled with a commitment to empower that individual to add as much value to the company as possible. They should be included in all major business decisions and they should be sharing thoughts and advice regularly on how to improve the company as a whole.

A monthly meeting with all of the leaders/executives of the company is often one of the best places to accomplish this. The part-time CFO should present the company’s financial statements at this meeting, which always leads to strategic discussions on how to improve the company.

SHORT-TERM RELATIONSHIP ONLY

When a new employee begins their job, research says that their most unproductive time will be during their first three months. Their value contribution increases with each day of on-the-job training and experience. Hiring a part-time CFO is no different. Once they learn the business and build the relationships needed to effect change they become increasingly valuable to the company. Hiring a part-time CFO on a temporary basis will have “flash-in-the-pan” results – it will look impressive and even make some loud noise, but it will most likely not have a long-term impact on the business.  In almost all instances a permanent part-time CFO will create the most sustainable value for the business.

CONCLUSION

Can accounting and finance really add strategic value to the business, or do these functions play solely a role of compliance? With a permanent part-time CFO, many business owners are experiencing a decrease in anxiety and an increase in success.

PLEASANT GROVE, Utah, July 6, 2009 - CFO WISE Founder & CEO, Ken Kaufman, was quoted several times in a recent article published in the Utah CEO Magazine by Steve Gooch on the topic of how and when to hire a CFO.

CFOwise founder Ken Kaufman commented on this additional exposure by stating the following, “The Utah CEO Magazine is a great resource for CEO’s operating in the Utah area. The information provided in this article is not only informative to what we do at CFOwise, but also instrumental in introducing the business world to our industry.”

This article in particular provides Owners and CEO’s the information that they need in order to effectively make a decision when it comes time to decide between a part-time CFO or hiring a full-time CFO. Ken Kaufman had the following to say within the article:

“The philosophy that we work under is that every business needs a CFO, but with the concept of independent CFOs, they should all be able to afford one on an outsourced, use-exactly-what-you-need basis. Usually a company doesn’t need a CFO on a full-time basis until they hit a certain level of sales and complexity.”  

About CFOwise

With over a century of senior-level executive experience, CFOwise is the premier provider of permanent part-time CFO services to start-up, emerging, and medium-sized companies in the United States. For more information, please visit: www.cfowise.com or contact Kim Waldron at 801-380-5615.

About Utah CEO Magazine

The Utah CEO Magazine can be summarized in their Editorial Philosophy, “Robust business is good for everyone, and creating that environment starts with our readers – Utah’s business elite. Our purpose is to provide information to help those business leaders navigate through challenges and seize opportunities. By consistently offering superior content, Utah CEO supports the immediate goals of Utah’s businesses while encouraging forward thinking to sustain the momentum. Outstanding ideas are at the core of a viable business culture, and Utah CEO keeps an ear to the ground for those outstanding ideas.” The content in Utah CEO is designed to serve a business purpose first, not just entertain. For more information please visit: www.UtahCEOmagazine.com .

If an organization needs to hire a CFO or create a CFO position, we highly recommend the inclusion of these reposibilities in the CFO job description.