Why did you start your own business?
- You had a passion for a particular business, so intense, that it kept you up at night.
- You always wanted to be your own boss.
- You liked the idea of “President” printed on your business cards.
- You wanted to spend holidays and weekends curled up with financial statements, budget forecasts, cash flow issues, and (best of all) government tax forms.
Unless you are in the financial business, answer #4 probably didn’t make it on your list. So ask yourself, why am I still spending my time doing these activities? Most likely, you’ve got a DIY (Do It Yourself) mentality when it comes to the finance function in your company.
Overcoming the DIY Mentality
It’s important when you first start up to understand all aspects of your business—and of course, keep costs down. But eventually, it comes time to let go of a DIY mentality. Perhaps the realization happens one Friday when you’re at home creating fun spreadsheet reports—or at least trying to—when the dog starts barking at the TV, you reach for the mute button, spill your beer, and while leaning over the keyboard, trash the unsaved file you’ve been working on for the past three hours.
The truth is, you’re not saving money. Not only is the work you are doing taking away from A) business development, and B) making money, it is also preventing you from having “down time,” which gives you the energy to actually do both A and B.
What finance functions can I outsource?
When signs appear that a finance function is under stress, perhaps it is time to consider what tasks can be delegated to an outside back-office service. An outsourced finance department typically manages any business service related to money. For example, at Black Tulip, these services include:
- Budgeting + Projections
- Cash Flow Projections
- Regular Financial Reports
- Government Reporting and Payments
Setting up an outsourced finance department doesn’t have to include all functions at once. As your business and revenue grow, you can add as needed.
Benefits beyond time and money
Outsourcing a finance department does more than take spreadsheets and cash flow issues off your plate. If you’re truly committed to running an innovative company, or an efficient business, consider these additional benefits.
Ready, set, grow: An outsourced finance department provides the structure and organization to prepare for and handle growth.
Outsource experts make everyone better: Those who provide the outsourced services also bring the latest technologies and best practices. Your team becomes a whole lot more effective and efficient.
It can be lonely at the top. Many business owners lack colleagues at the senior level. Outsource experts become such colleagues, helping you with challenging situations and objective advice.
Stay out of jail (or at least, out of trouble). Outsourced services keep your business current with changing legislation and best practices so you’re protected from compliance failures.
Time to “Blue Sky”: Never underestimate the power of big picture thinking. Once those financial statements are off your mind, you can start planning how to drive the company forward, generate more revenue or invent that next “big thing.”
It’s easy to fall into the pattern of doing all the work of a finance department inside your business. You either use the “spare time” of other staff (taking them away from their focus), or you do it yourself (because, of course, your time is “free” and you can do the work better than anyone else).
Resist the urge to think this way and take time to step back and ask, “How can I make an outsourced finance department function effectively in my business?”