Chris Ortega is a fractional CFO and chief executive of Fresh FP&A. He is one of the experts who will speak at the upcoming CFO Brew live event, “Next-Gen Finance: Future-Proofing Your Business Operations.” Ahead of the event, we spoke with Ortega about how organizations can balance efficiency with opportunity.
This interview has been edited for clarity and length.
How do the organizations that you work with balance the need for efficiency with growth opportunities?
One of the objectives that we’re always working with our clients on is how they are maintaining profitable growth…You want a growth rate somewhere between 15%–50%, you want an EBIT margin somewhere between 5% and 15%, and you definitely want to be cash flow positive. So I think for us, we’re always balancing growth over efficiency and scale, and making sure we’re doing it in a profitable way, not just in a way of growing the top line as high as possible.
That’s always a balance, because you do have CEOs that are really aggressive, and really want to push it. But that’s where that healthy friction comes in with our clients. They respect us, they trust us as their strategic advisors, and we’re valued partners for them, so we have that seat at the table to share that idea around profitable growth.
You said something that caught my attention: the term “healthy friction.” In the role you play as a fractional CFO, how would you describe your role as a strategic partner to the CEO but also helping set expectations?
When you’re leading high-growth businesses and you’re working with the CEO, the business owner or founder, it is always a healthy tension…We have clients and they’re really aggressive in their growth targets. They’re really aggressive in maybe bringing on headcount; they’re really aggressive in terms of looking at go-to-market strategies; they’re really aggressive [with] acquiring other businesses; they may be aggressive even in fundraising rounds. I think what’s always important is setting that expectation of, “Hey, here’s what reality can look like.”
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How do you see new and emerging technologies like artificial intelligence impacting the efficiency of organizations?
I don’t think AI is going to replace finance professionals. The real purpose of all these emerging technologies—generative AI, prescriptive and predictive analytics, machine learning, [robotic process automation]—all these different new technologies that are coming to the office of the CFO, the No. 1 focus that they’re going to have for CFOs of the future [is] they’re going to upskill our value. Think about it. A lot of times…most CFOs are spending so much of their time in tactical work—the balance sheet reconciliations, grabbing the data from this system and updating this forecasting model to get this over to here. Eighty percent of CFOs’ jobs is tactically oriented. Where technology can help is get those CFOs out of that tactical, low-value, routine, manual work that we don’t want to do…Where we want to be positioned is [to] rebalance that tactical [work] to strategy.
Among the many choices of new technologies, how do you determine which is going to have the best ROI for a company?
The focus needs to be [on] what are our immediate problems, frustrations, and opportunities that we have in the business? Maybe that’s data aggregation, or maybe we don’t have a sophisticated system to look at the future of our business, or maybe we need to get better in our cash flow management. Really get down to those core issues, frustrations, and problems that you’re having in the business, and then look at the technology. Too many times, the fundamental mistake a lot of CFOs make [is] they go technology-first, and then they try to make the technology solve all their problems…It needs to be the other way around.
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