The warning comes from the SME Global Forum of the ACCA, in which it says that finance chiefs must start acting as business partners with a better understanding of the daily running of the business to help make more informed decisions and understand the whole impact those decisions will have. The Forum also stated that much of the discussion on business growth assumes that growth is a potential option for businesses at all times, when the reality is very different.
Charlotte Chung, Senior Policy Adviser at ACCA, said: “There is a lot that separates the finance function of a static business from one geared for growth. The SME Global Forum has looked at what makes a company grow in detail and a key starting point is the notion that growth is not something businesses can dip in and out of at will; it requires constant management and analysis using timely and accurate data. Without this, rapid growth can be scuppered by what might seem to be very simple risks, such as overlooking loyal customers.
“The underlying theme in unlocking a business so that it is fertile for growth is the pivotal role of the finance function. Finance leaders must start acting as business partners – getting their hands dirty and being more intimate with the day-to-day workings of the business. CFOs and FDs of growing businesses must become the central information hub for the business - consolidating, synthesising and disseminating information to where it is required, be it to meet new regulatory and compliance targets, scan their environment for funding or business opportunities or make the case for new activities such as exporting.”
The Forum made these key recommendations for businesses on developing an environment conducive to growth:
• Ensure business plans for growth are designed to be ‘living documents’
• Invest in data infrastructure
• Focus on balancing the benefits of outsourcing with the need for self-sufficiency through building in-house capacity
• Develop and grow strong financial leadership
• Understand what growth will look like for your business over the long term
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