1. Preferred Tools for Financial Analysis
When asked about his preference between Google Sheets and Excel, Tom opts for Excel, citing familiarity and industry adoption, particularly noting that none of his clients use Google Sheets. This choice underscores the importance of using robust and widely-accepted tools in financial analysis.
2. Industry Focus
Tom primarily supports established firms in manufacturing and distribution, steering clear of early-stage and pre-revenue companies. This focus reflects established businesses’ complex financial needs, which require seasoned financial oversight.
3. Planning Platforms and ERP Systems
Regarding planning platforms, Tom adapts to the existing systems of his clients. He mentions using Excel for flexibility but also integrates with client-owned ERP systems, such as Microsoft Dynamics and Power BI, to leverage their capabilities.
This adaptability is crucial for fractional CFOs working within diverse technological environments across clients.
4. The Role of ERP in Different Scales of Business
Tom observes various ERP systems in use among his clients, from widely known solutions like QuickBooks and Microsoft Dynamics to specialized systems designed for specific industries, such as forklift companies. His experience highlights the importance of choosing the right ERP system that scales with the company’s size and industry requirements.
5. Use of Generative AI
Although not widely adopted in his group, Tom uses generative AI tools like ChatGPT for tasks such as writing and streamlining job descriptions. This application illustrates the growing relevance of AI in enhancing administrative efficiency and supporting strategic tasks.
6. Essential Skills for FP&A Professionals
When considering the most crucial skills for FP&A professionals, Tom emphasizes the mastery of spreadsheets and the importance of interpersonal skills. He advocates for FP&A professionals to engage directly with various business units to understand the business beyond the numbers better.
7. Building Effective Business Partnerships
Tom advises FP&A professionals to actively engage with team members across the organization to be effective business partners. He used to carry atomic fireballs as a conversation starter, a creative method to foster relationships and gather insights during informal interactions.
Conclusion
In conclusion, Transitioning from an FP&A professional to a fractional CFO is a strategic career move that taps into deep financial knowledge and broad business understanding. Tom Schultz’s experience highlights that this journey involves more than just understanding numbers.
It requires mastering financial tools like Excel, adapting to various ERP systems, and using generative AI for efficiency. Effective interpersonal skills are also crucial. Engaging with different departments helps fractional CFOs understand unique challenges and influence strategic decisions.
This interaction ensures financial strategies are well-integrated across the company, leading to better overall management. The role of a fractional CFO is becoming increasingly important as businesses recognize the need for skilled professionals who can navigate financial complexities and lead strategic initiatives.
For FP&A professionals looking to step into this role, it means changing their job title and significantly expanding their influence within the business landscape. This transition is not only a personal growth opportunity but also a chance to impact business operations and success substantially.
FAQs
What are the key differences between a full-time CFO and a fractional CFO?
A full-time CFO is employed exclusively by one company, managing all financial aspects. A fractional CFO provides high-level financial strategy and guidance to multiple smaller companies on a part-time or contractual basis.
What role does technology play in the transition from FP&A Professional to fractional CFO?
Technological proficiency in financial modeling, ERP systems, and data analysis tools is essential. These skills help in delivering efficient and accurate financial insights across various platforms.
How long does it typically take to transition from an FP&A professional to a fractional CFO?
The transition period can vary widely depending on individual experience, industry knowledge, and access to mentorship. It usually takes several years of strategic career development and networking.
Can a professional transition directly from an FP&A to a fractional CFO role?
Direct transition is uncommon; usually, stepping into roles such as Controller or Corporate CFO first provides the necessary experience in managing broader financial operations before moving to a fractional role.