9Jan-Feb 2017is to be proactive and not reactive relative to the financial state of the organization.Having a strong ERP/MRP system is a must. In the case of our organization, we are expanding in the U.S. and internationally. For this reason, our ERP system is in the cloud and can be accessed from anywhere. We use the same chart of accounts across the organization, with minor variations. We also use consolidation overlay software, which provides us with an easy way to view the finances of our international operations in a consistent manner. This software is especially useful for dealing with multiple currencies and the resulting exchange variation issues.When it comes to enterprise resource planning, visibility and analytics are key. Operations, production, R&D and other parts of the business should be tracked using consistent metrics that are easily communicated and analyzed. I am a big fan of Visual Factory and Lean Thinking approach: go/no go; green/yellow/red. Having the data presented visually rather than with the traditional historical accounting reporting, allows for a better view of the future performance. It also helps non-financial people understand finance, which is especially useful in the boardroom and in executive meetings.If I could pick one specific tactic that helps with the management of rapid growth, it would be pace reporting. The core of how we measure ourselves is in the budget vs. actual variance analysis. Each month budget for the previous month is replaced with the actual numbers. For example, when February comes, we'll have January as actual and the remaining 11 months as budget; then when March arrives, we'll have January and February as actual and 10 months of budget. If we are hitting the plan, the pace should be consistent with the 12-month plan. But if something turns from green to red, then we can drill down to where the problem is and course-correct immediately. I am a big fan of trailing-12 analysis of specific deliverables we want to hit in the business, such as bookings, revenue, expenses, cash flow, elements of working capital, and some specific accounts for expenses.Hiring and Retaining TalentIt should go without saying that if one wants exceptional growth, exceptional talent is needed. What I learned early in my career is that one has to be willing to pay for talent. High performers cost money, but are worth the investment.I have noticed that, unfortunately, too many CFOs are too afraid to hire talent. Perhaps they feel that a smart newcomer could be a threat. But I believe that a good CFO should never be afraid to hire the next CFO. Smart people, when treated and mentored properly, will make your job easier. They will also make you a better leader.How do you pick the right people? Personally, I look for thinkers­hungry, resolute thinkers. I look for people who have demonstrated success early on; who are open to mentoring; who are not set in their ways. Ultimately, I want change agents on my team: those who will bring ideas and solutions to the problems, not those who bring just a mechanical process.In the interviews I look for good listeners. I provide a brief description of where we are today, and then I listen and look for their thought processes. I am very much interested in knowing how they get from a problem to a solution; that tells me if they are solution providers or rote operators. I was blessed early in my career to have very successful individuals mentor me. I repay the favor by doing the same for the people I hire. But I always start by hiring the best I can afford because, ultimately, great organizations are built by great people. The talent you bring on board is perhaps the biggest determining factor in whether you will grow your business as fast as your plans suggest. A good CFO always has the finger on the financial pulse of the organization
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