How to Achieve Effective Working Relations between the Entrepreneur-Leader and the CFO

As GOEVs evolve through their stages-of-development in pursuit of creating value, the challenges and opportunities they encounter will become more and varied. The scope of issues for management will likely transcend the capacities of a single individual, which may account for why studies indicate that team-driven entrepreneurial enterprises are more successful than solo entrepreneurs, on average. Accordingly, GOEVs will need to expand their entrepreneurial management teams by adding (and ideally retaining1) talent with functional diversity – for example, to manage their expanding and diversified needs for various aspects of financial management2. But, the benefits of increased functional diversity come at a cost – challenges to cohesiveness/teamliness, like different types of conflict. Thus, effective teamwork remains a crucial factor for enterprise performance.

The relationship between the entrepreneur-leader and the financial manager (e.g. a CFO) is visible to many stakeholders. Capturing and retaining the engagement and commitment of stakeholders is essential for the enterprise to achieve several goals. Engagement can be impacted by stakeholders’ assessments of the performance of interdependent work and perceptions of the nature of relationships within the enterprise’s management team and particularly the relationship between the entrepreneur-leader and the CFO. The effectiveness of their relationship depends on five factors: environmental factors (impacting ‘fit’), roles and expectations (particularly understandings by each party), the particular knowledge/skills/abilities (‘KSAs’) of each party (both functional and social), the nature & quality of social interaction processes involving the parties (including interdependence and types of conflict), and the outcomes of those interactions (including a posteriori assessments of fit). This article discusses all five factors and recommends conditions for achieving this dyad achieving the state of a 'Dynamic Duo'.