Equipment Dealer CFO: Resources to Help You Thrive!

What is the role of the equipment dealer CFO, and how can you thrive in this role? Here are a few resources that may help.

?Resources for your development as CFO

?a.?????McKinsey, The Role of the CFO. Three areas of CFO responsibility that may be of particular relevance to you are:

• Strategic leadership & business transformation (e.g., the strategic plan to build a rental business)
• Risk management and financial & regulatory compliance and reporting
• Increasing owner equity

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b.?????Article: "…Bring Life to Accounting in a Farm Equipment Dealership."

Includes a great definition of the accounting roles: "Accountants impose order on chaos through two elements — people and processes. The comptroller manages the general ledger. The role of the chief financial officer (CFO) is to dial down deeply, understand the business, and increase the owners' equity."

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c.?????Article: Why you don't need to be an accountant to be a CFO

CEOs seek a business counsellor as much as a financial counsellor in a CFO. This is where you can shine!

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d.?????Books: I highly recommend you read one of these:

• The 80/20 CFO: How to Make Strategic Transformations in Your Company, Janice Berthold & Suzy Taherian
• The Successful CFO, Tony Tripodo
• Good to Great, Jim Collins

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e.?????Potential training

Advanced corporate finance (Wharton)

CFO Program (London Business School)

CFO Program (Deloitte)

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?Role of accounting in an equipment dealership.

?The old adage in equipment distribution is that we Sell Equipment, Fix It, and Collect the Money. Of all the functions an equipment dealer has, collecting money and doing it exceptionally well should be at the top of the list.

?Here are six essential functions of an equipment dealer accounting department:

1. Collect and dispense cash for the successful day-to-day operation of the business (manage cash flow).
2. Manage payroll and track employee time off.
3. Provide accurate and timely financial (external) and management (internal) accounting and statements.?
4. Manage the company's working capital (ratio of current assets to liabilities), including inventory cost management.
5. Please ensure that the company does business in compliance with all the jurisdictions in which the company does business.
6. Manage budgets, including financial forecasts and capital expenditures.

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?How to fix your accounting department (using the Sig Sigma DMAIC method):

• ?Define:?What is the problem you need to solve? What's working today? Isn't? Gather feedback from your team and other departments (and select customers) interacting with the accounting department.
• Measure: Gather the KPI's that define performance (e.g., AP efficiency, AR at 30, 60, 90+ days, frequency and accuracy of financial reporting, problem resolution time). Map your processes.
• Analyze: What are the performance gaps? Analyze your people. Do you have the right people in the right seats? Do you need more staff to improve what matters?
• Improve: Define a clear action plan with owners to fix broken things—weekly (brief) meeting to review progress.
• Control: Use a performance scorecard so that everyone knows the result of their efforts.

I hope these help!