#The role of the Finance Director
Is your Finance Director a Dinosaur or a Navigator?
If the FD of your business is using traditional management reporting methods in today’s competitive business environment, then you are in a storm with no rudder. You don’t have a navigator with the Capitain.
Which means, you are in a commodity business and loosing money because you are not competitive in analysis, controlling and reporting of the costs of your processes.
How do you get out of being a commodity to a differentiated market client focused business?
One way sure way is to develop your finance team in the principles of lean.
- You will reduce non-value added work across the organisation.
- Properly report the operational side of the business not based on absorption costing but true costs reduce fixed costs as a percentage of total costs – this is true tps.
- Align all variable costs to volume production.
- Standardise the operating ratio.
- Reduce inventory levels and increase rotation of stock of parts and finished goods.
- Solve problems quicker so as to improve to flow.
- Kanban where you cannot flow.
- Improve cash flow.
- Reduce lead times.
- Improve customer delivery times to requested date not agreed date.
- Increase the number of change overs smed so reducing batch size.
- Impact quality assurance across the organisation.
These are not superfluous words taken out of a book, these are the results of your competitors.
The Role of the Finance Director today is not to automate with the next ERP system, but to manage the business applying and promoting lean principles and behaviours.
You are the captain of your ship, make sure your FD supports operations as they battle the storm.