How to Manage a Remote Finance Team as a CFO
Suzanne is currently the Chief Financial Officer of Gym Launch. Gym launch is a consulting agency that helps gym owners convert their gym model into a profitability machine.
Having worked as a CFO and also remotely for over 10 years, Suzanne has a unique blend of skills. She has the experience that ranges from venture-backed startups to Fortune 500 companies. Suzanne does not hesitate to dig into the most difficult strategic challenges within an organization. She has an eye for eliminating inefficiencies, and barriers to financial stability within an organization.
Suzanne is passionate about moving nimbly from vision to execution and creating a positive, ethical and high-energy environment and culture.
In this episode, seasoned remote CFO and finance executive Suzanne Shifflet of Gym Launch joins us to chat about strategies for managing spending and finance teams in a distributed workforce. Additionally, we cover how to keep teams motivated and engaged during the shift to remote work.
This interview is taken from an episode of the Spend Culture Stories podcast.
Speakers: Suzanne Shifflet, Chief Financial Officer, Gym Launch
Listen to the Episode Here:
Q: In these times, how do you manage a team as a remote CFO?
Deliberate and Regular Communication
It’s not a whole lot different than being a brick and mortar CFO. One differentiator is that you have to have deliberate communications with your teams. For example, a regular cadence to have one-on-ones. Make sure that you communicate everything that you need from your staff in a very precise way. Being specific is crucial so that when you have the outcomes, they come back to you in the way that you were expecting. In short, be crystal clear about your expectations.
Shift to Outcome-Based Work
One of the things we do here is focusing on work products that are outcome-based, as opposed to when you are able to go meet with someone face to face. You’re able to kind of see that they’re working hard and all of that when you’re at an office.
Whereas when you’re in a virtual environment, you’re really having to depend on what is getting produced. For instance, either your monthly financials, your audit, all of those kinds of things. It’s more outcome-based, as opposed to just walking over and having that quick-touch base several times throughout the day.
You’re more apt to just connect a couple of times throughout the day either over Zoom or Chat. You might even let a day could go by but you have to know that those projects are in play.
Communicating at the beginning is really important and then having regular one-on-ones and team meetings. What we do in our team meetings helps with making it a little less like a virtual team. We do things, like play little games and get to know each other.
Q: Going back to the communication piece, how do you communicate the spend culture of Gym Launch Secrets to your team since it’s such a unique remote model? How did you build a process around it?
Building a Standard Operating Procedure With Approval Chains
Well, I think that’s pretty easy, actually. We just have a lot of structure in place that’s not really in the brick and mortar environment as a startup. So, we have standard SOPs already in place and having good controls are also key.
We have communication around what each individual is allowed to spend and submit an expense report. Then we’ve also instituted an automated approval process through our systems. Personally, we use bill.com and an expense software, but any tools where it has an automated approval chain in command is good enough.
But if you don’t have communication at the outset, a lot of employees will go ahead and spend money and then expect to be reimbursed for it. So, it’s really important to have clear guidelines upfront. That coupled with departmental budgets that they participated in are key to making sure that everyone knows what is expected of them.
Taking Ownership of The Spend Culture by Being Budget Owners
Here at Gym Launch, we have real A-players that are leaders within their business units and they’re excited to be owners of their own budget, owners of their own profitability.
Some of them are first-time business unit leaders and they are enjoying getting educated around the budget and looking at the items that they know they can control. So, when we were training them on that, I took them through a financial statement, I took them through the budget. And I said, this is something you can control, this is probably something you can’t control. They were really excited about knowing that they could control that. I think giving people freedom, coupled with standard operating procedures for frontline-level people are really how to make the spend culture work.
Q: As a company grows past a startup phase, what are the challenges when it comes to managing organizational spend?
Building a Process Early and Explaining The “Why”
If you set those things out early, you really don’t have as much of a problem managing spend. It actually should be the same environment in a small company as it is in a scalable organization.
What you do is you just make sure that the people that own that budget are communicating those procedures down and are really being proactive in approving the spending along the way.
So, if they get an expense report that’s outside our procedure, they’re really diving in on that, and educating the employee or the individual as to why that’s not allowed, and what that ramification means for the business.
Q: How do you ensure those controls scale along with the company as you add more and more headcount?
Ensure Controls Scale Along with the Company
I really encourage my startup companies, whether I was on a consulting basis or a full-time basis, to institute an approval management system early that has the system behind it to have the layered approval process in there.
We also encourage putting in all of the backup documents and everything right in that system so that the approval will have access to source documents as they’re approving.
As long as you have laid out the clear guidelines on the appropriate expenditures, havin a system behind it, that scales as long as you keep that communication line going as to what expectations are.
Q: The burn rate is something like an elephant in the room for a lot of software startup leaders. How can a company manage a healthy burn while also striving for growth while managing a remote finance team?
Being Prudent and Aware of Your Spending
Suzanne Shifflet [00:21:01] That is really a great question, to be honest with you. I feel like that also can really impact some of the smaller startups. They just started growing past what is reasonable for their product or their market or their team size.
They’re looking at things and maybe they have quite a bit of funding in the background and access to deep pockets – but they’re really not being prudent as they grow their organization with that cash spend in mind.
When you see that, it’s kind of unfortunate. I’ve seen people go through millions and millions of dollars of fundraised investor money with nothing to show for it. It’s sad to me and it’s hard to support that as a CFO.
I usually try to back out of those organizations as soon as possible just because as a CFO, those investors are really looking to you as a financial leader to be a gatekeeper. They see you as sitting in between the company and the investors themselves as a watchdog over the investments.
When that kind of spending occurs, it’s really hard as a CFO, if you can’t get behind it. So, if you’re making prudent decisions, like adding sales leadership or making a change like that makes sense and it makes sense, you can look at your cash flow and justify your cash flow spend. But once you’re seeing some of the younger entrepreneurs and they might be building a brand, or things that aren’t really adding to the value of the product itself – it’s harder to support that.
Have a Balance of What is Appropriate Cash Spend for Your Investors, Product, and Strategy
Suzanne Shifflet [00:22:43] It’s really important to have that balance of like how to grow, what is appropriate cash spend for your investor base, your product vision, balancing that and that’s where it takes a real strong strategist from a financial perspective to understand that.
And again I roll back to some of those earlier stage CFOs, they haven’t seen a lot of that. They might have a tendency to just kind of nod their head. Especially when the CEO is saying ‘we’ve got to have it’. They’re not looking at the value of that to the business strategically. In turn, that meets the needs of the constituents, the employees, the business itself and the investors.
About the Podcast:
Your company culture might attract talent, but your Spend Culture will make or break your company. The Spend Culture Stories podcast helps finance leaders learn the tactics, strategies, and processes to build a proactive Spend Culture. In this podcast, we have human conversations about the messy and sometimes hilarious stories that happen when people, organizations, and money meet. Learn how to pick the right tools, implement the most efficient processes, and how to develop the right people to transform the Spend Culture of your organization for the better.