Much like their counterparts in the CIO community, a growing number of financial executives are deciding that, rather than devote themselves full-time or on a permanent basis to a single organization, they will take on a sort of chief financial officer consulting role. Canada’s Financial Post recently profiled a number of leaders diving head-first into the so-called “gig” economy, as well as a placement agency called the CFO Centre which is connecting such professionals to small and medium-sized businesses that need them.
“Virtual CFOs can also choose to work seasonally, and will often flex their hours up and down to suit their lifestyle,” the Post article said. “Virtual CFOs also have the opportunity to diversify their clients to gain new experiences, and many enjoy the satisfaction of having a direct effect on a company or organization.”
On the flip side, organizations that hire virtual CFOs (or those who decide to take on such work) should be prepared for major differences. Adam Shay, a CPA based in Wilmington, N.C. who specializes in working with entrepreneurs, says the model works best for firms in the sub-$15M revenue range. Virtual CFOs main value lies in formulating strategies, ensuring accurate reporting and improving business processes.
“You can get someone with a strong skill set who can bring experiences from working with other clients,” he wrote in a local business journal. “(But) a virtual CFO isn’t as dedicated to a company as a full-time one would be. While virtual CFOs can be really responsive, they can’t always drop other things they are working on and one company isn’t that person’s only focus.”
Tools for Virtual CFOs
Since virtual CFOs are of particular interest to smaller, high-growth companies, it’s also likely they’ll be exposed to tools and resources that match the on-demand nature of the services they’re providing, and that best serve the needs of high growth firms. If they’re not in the office every day, for example, they’re most likely going to be keeping in touch using cloud-based services and SaaS products that can dynamically provide access to data and insight to help their clients improve decision making. Cloud based Excel or corporate performance management (CPM) software are prime examples for finance, though there are many others.
“They also get to nurture and shape the future of a lot of companies. The excitement and challenges of working with a growth company CEO is an enriching experience,” an article in India’s Business Standard said a few months back. As such, there’s no reason why some virtual CFOs couldn’t eventually move back into a more traditional position with a larger firm — bringing those valuable experiences with them, including the tools they’ve implemented.
One need only look to companies like Saleforce.com or Netsuite to see how mid-market and even large enterprises have widely adopted financial and ERP tools from an initial SMB market.
As with many other aspects of the gig economy, becoming a virtual CFO may be something that professionals do for a period of time, when it makes sense for their life and career. No matter how they choose to work, though, there’s nothing virtual about the potential impact they can have.