Listen, Learn and Profit From Your CFO
By Mike Fulton
In PR agency life, creativity, strategic direction and the skilled execution of communications campaigns receive the bulk of attention from clients, employees and judges in award competitions.
But we cannot forget the finance team and the chief financial officer who keep the lights on, cut our paychecks, match our 401(k) contributions, and process company invoices and expenses every month.
At my first agency job in the 1990s I learned how important every dollar is to the bottom line. I learned why we need to spend our time wisely and the value of employees meeting deadlines to enter their billable hours and expenses. I learned it’s necessary to execute letters of agreement with clients before starting our work.
Bring solutions, not problems.
During my career, I have worked at four agencies of varying sizes and have seen solid financial tracking and performance grow in importance. These monetary details are rarely taught in universities or featured in professional development seminars. So here are some best practices I have gleaned over the years.
For starters, we need to accurately update our time and expenses daily. We need to understand how much we cost the company (in our salary, benefits, expenses, equipment, etc.) and how much income we generate for the organization.
Further, we should always be honest and transparent with clients about fees, expenses, variations in estimates, start and end dates for projects and how often we process invoices. We must pay attention to the hours we bill on each aspect of the account, and whether the time we spend is commensurate with the fees we charge.
Solid financial tracking and performance also require that we help prepare invoices for the client projects we work on, and that we honor the “no surprises” rule. This means informing the boss and the CFO when we know clients might be late in paying fees or expenses, or when we might lose a client. It means helping secure late payments owed to our agencies.
We also have to make sure that vendors and suppliers associated with our work are paid.
We need to understand what we can (and cannot) share with team members about our companies’ finances and the accounts we work on together.
Be proactive, not reactive.
Helping to ensure solid financial performance also requires us to be proactive, not reactive, to our companies’ financial situations. To that end, we should bring solutions to our managers and CFOs, not problems. After all, the CFO helps decide raises and bonuses, along with downsizing and severance pay — a good person to have on our side.
So be creative and strategic, win awards and gain the admiration of your peers. But remember that PR agencies are vulnerable businesses that require tight control of financial projections, results, payments and progress.