Whether your role is in a large corporate that has been around for many years or in a small, newly established organisation, you will always be faced with instances where decisions need to be made. It is the decision making process that brings to light the different management styles that individuals generally adopt.
As a manager, one would generally be expected to lead his/her department or function to success – depending on the key performance indicators of his/her organisation. The manner in which that success is arrived at is generically reflective of a manager's ability to use efficiently whatever resources that are at his/her disposal in such a way that the organisation's goals and objectives are met.
Without a doubt there are, in my opinion, core support functions that make an organisation successful – human resources management and finance, amongst others. However, the size of the entity plays a crucial role in deciding whether or not to centralise these functions into one department – the finance and administration department.
The leadership of such a function needs to be financially literate and have a strong personality that will match the likely challenges of his/her role. He/she needs to be a goal-orientated individual that is well-vested in knowledge across all levels of business administration; from handling finances right through to the management of the human resources of his/her organisation - not forgetting the record-keeping of such activities. This individual also needs to understand all the nuances of this multi-faceted department in detail.
What better individual to lead this centralised function than the CFO (in a large corporate) or a finance manager (in a small to medium sized entity).
Let me paint a scenario for you: What happens if an entity is newly established, or has been around for a couple of years but hasn't realised its full growth potential? Do we still segregate the above-mentioned functions and appoint one person to manage each one separately? What is the most cost effective method of guaranteeing success for the company? These are some of the questions that are potentially common in strategy sessions; simply because each sub-function has its own intricate challenges that may not necessarily be addressed all at once by applying a single-minded strategy. How does the organisation address these questions?
First of all the most cost-effective exercise would be to merge these core support functions into one department and appoint one person to run with it – whether it be the CFO or finance manager. Secondly, this calls for innovative leadership in managing the department. The following tips may come in handy in increasing the chances of administrative and financial success for the organisation:
Innovative human resource solutions
Make an effort to know who works for your organisation and what they do. You are in charge of co-ordinating the human capital of the entity. This is the work force that will contribute to the success of your organisation. Get to know what their strengths are and attempt to build on them. The important question is this: What training is required to get your staff to perform at their peak? Do not be oblivious to the fact that “knowledge is power”. It is also critical that you as the CFO/financial manager get yourself trained on how to manage the staff and get them to deliver for the benefit of the organisation.
Innovative financial management
The most important tool you have at your disposal is planning. Have a comprehensive financial plan that takes into account your organisation's current financial position and accommodates any future budgetary requirements. As obvious as this may sound, it is about going back to basics and crafting a way forward that will safeguard the organisation's future success.
The focus should be on cost-cutting and the search for new and sustainable revenue generating opportunities. Although at this point in time your organisation may have survived the recent economic downturn, there is always room for extra cash to use in taking advantage of newly identified investment opportunities. Growing your organisation can only make it strong enough to survive the next economic storm.
Kopano Xaba, BCom (Hons), is Finance and Administration Manager at Empowerdex (Pty) Ltd.