Finance overview
The finance function must move beyond its traditional role and increase its support to the steering of strategic, financial and operational activities across the enterprise. The objectives are to maximise the return on capital employed and cash generation to accelerate the achievement of profitable growth.
Principles of finance
Strategically, there are six top issues facing CFOs:
- Supporting the CEO in the definition and steering of the strategic plan
- Aligning financial planning to the strategic plan
- Positioning the function as a key player in business transformation
- Creating value and making good investment decisions supported by proper business cases
- Defining the right management framework to optimise the enterprise’s financial performance
- Managing information to guarantee the comprehensiveness and precision of the financial indicators of value creation
Operationally – where the objectives are to maintain and increase competitive advantage – the challenges are to secure and improve direct margins, strengthen operational and financial prediction capability, control operating costs and accelerate the generation of free cash flow.
Transforming business finance
To address these issues, the finance function must rethink how it is organised, develop its skills and optimise its activities, where appropriate taking advantage of digital developments and AI.
SG&A overview
The support, commercial and central functions are critical to the effective running of a company. These include, but are not limited to, finance, HR, sales and marketing, procurement, R&D and IT. Beyond operational support, these functions contribute to the development of the company, its performance, its strategy, and compliance.
Principles of SG&A
According to our benchmarks, the total cost of these functions, commonly known as SG&A (selling, general and administrative expense) is generally between 6% and 20% of revenue, depending on the sector and the functions’ maturity.
If a reduction in SG&A expense improves a company’s profitability, it is the quality of services delivered that creates value: the quality of financial performance management by finance, talent management by HR, optimisation of supplier relationships by procurement, innovation by R&D, increased productivity through IT systems, and in particular sales generated by the marketing and sales teams.
Transforming SG&A
When looking to increase its competitiveness, the challenge for a company is to optimise its SG&A structure through improved performance, both cost and service levels, implementing all relevant levers including digital and AI initiatives.
Helping with finance and SG&A challenges
Our finance and SG&A consultants dig deep to identify the root of complex problems and focus on delivering tangible results for clients. The menu bar on this page provides more detail on a selection of the financial and SG&A challenges we regularly work on.
We apply a combination of technical expertise, operational experience, business knowledge and common sense to help our clients solve business finance and SG&A issues and deliver lasting results. Our positive, flexible and personal approach, with challenge where needed, ensures buy-in at all levels of our clients’ businesses and a positive outcome. Learn more about us here.
