01/02/2019
The silent enemies of any CFO,Minimal factors can cause companies to lose almost 40% of their profits
It is proven that at least one out of every 5 companies has money leaks due to lack of control in their operations, and the worst thing is that in 80% of the cases, this situation is due to basic carelessness in each department, such as the employee's lack of knowledge about his work, and the theft of products or goods of the company in minimal quantity, which when it is falling frequency, can cause significant losses and lack of control in the accounts.
Although these losses can translate into almost 40% of profits, they go unnoticed and add several leaks to the company, such as the illegal transfer of customers and the accelerated loss of market share, in addition, along with other critical causes of the disaster, such as the lack of planning and revision of CFO objectives, can also be a route of money leakage that prevents the business from running properly.
Big problems in the labor field are the minimal but frequent thefts that can be committed by workers in production and quality control departments. The lack of supervision and clear accounts opens up the possibility of this type of leakage, and an example of such practices is the lack of a continuous analysis of the activities and functions carried out by the different areas of the company, in order to evaluate and improve its functionality and the contribution of personnel.
In order to have detailed information, a job description is needed, where the requirements and responsibilities to achieve certain results are studied and determined, evaluating with direct indicators the response capacity and performance of each department and each worker.
Sometimes the company has this information very generalized, but does not update it according to the needs that arise or take into account the competition, much less details how it should, for this reason, there are gaps in information that make it very difficult to determine where the money leaks come from, and the process of correcting faults is more complicated.
Also present is the lack of planning and incorrect distribution of resources, there are companies where there is no difference between what is really necessary for the employee, and what is not used properly, even misused resources can be seen that directly indicate the employee as guilty of the imbalance in production, whether through negligence, underperformance, lack of concentration or irresponsibility.
Losses of money can be in any department
Another silent enemy of the CFO, which can create huge money leaks for any business, is to drift periodic evaluations of personnel, creating a false perception of security and trust or supervising only those in charge of each area, neglecting the lowest levels of the organization, where the primary and operational responsibilities of the business really fall.
This tool allows us to assess whether we have the right human resources for the positions that make up the different areas of the organization, if there is no constant qualification and evaluation, we will never be able to establish optimal production conditions to detect faults in the departments, we will not be able to know if the new human resources perform correctly or if the current ones lower the quality of their tasks.
As in a large institution, offices, and businesses, households also leak money, and it is important to take a family example to understand how these losses can create a serious medium- and long-term problems within the organization.
For example, a computer that stays on all the time, without generating productive tasks or being used by anyone, represents a loss of 15 dollars a month on average; the memory, the disk, and the processor are kept working and that wastes energy, and if we take into account that while those components work, they wear out, we can contemplate a bill for a new computer concept in less time than it should be.
Computer equipment, furniture, and machinery that are not necessary to carry out the company's main activities represent a loss of resources and an increase in operating expenses. And the problem grows even more when this equipment is used negligently, without taking into account that it represents an imperceptible expense in the short term, but can accumulate large amounts at the end of the evaluation periods.
Among the silent enemies, one of the most subtle is the minimal theft of products. Simply put, this is a thieving worker, who fills his pockets little by little, but causes losses between 30% and 40% in companies of any size, and who can reduce up to 10% of the inventory of organizations. This crime is the responsibility of the workers themselves, visitors or suppliers, which makes it difficult to detect it in a timely manner.
In addition, there is another important factor to take into account for these cases, when the worker sees that he can steal easily, without being discovered or the evaluation departments being able to determine where the money leaks come from, he will continue to do so with increasing frequency, malice and quantity, and may even generate criminal complicity, increasing the size of the losses.
One strategy to avoid this situation is to strengthen the control of inventories and physical assets through modern technological tools, such as installing closed-circuit cameras, managing restricted areas, having inspection policies, using security seals, managing employee profiles and having security personnel in areas susceptible to theft, in addition to establishing security areas in which the easiest resources to steal are managed.
The company's greatest enemy is to ignore changes in the needs and expectations of its market. It disguises itself as tradition, but in reality, it is a fear of change and the option of staying in a comfort zone. This later becomes dissatisfied employees, or that another company outperforms the numbers of the organization, by the inability to simplify or innovate in the functions performed.
In conclusion, it is not correct to think that the failure or decline in the numbers of a company are related to the work done by the department of the CFO, there are many probable causes and capable of generating losses of money in a business, and if these are not prevented in time, the lack of control could be underway and no one would be able to detect it yet.,,https://cfohero.com/the-silent-enemies-of-any-cfo/
