Roger Castle, FD at The FD Centre

We sit down with a highly experienced CFO to get his take on the importance of strategic planning… 🗣️

3 min read

Calculator next to printed financial results

Roger Castle is a highly experienced CFO with a strong track record of growing a number of significant technology businesses & brands – Savvis, Yahoo, Radianz – some through to significant exits.

He now works for the FD Centre working across a number of SMEs and mid-market businesses in a number of UK sectors. He provides financial and strategic advice, along with guidance to the boards and finance teams of these businesses in order improve their growth and success.

We sat down with Roger to have a talk about strategy and what he sees in SMEs…

Hi Roger! You have a lot of insight into small businesses, what do you see as the current state of strategic planning across SMEs?

Almost non-existent. For the businesses I work with most only have a one year budget at best. They are aspirational for growth but it’s not quantified, targeted, communicated and reported across the business. In other words transformation of the business, new products, customers, geographies, verticals etc is not really driven.

That aligns with the statistic that only 1 in 20 SMEs have a strategy. Given it’s so important, why do you think so many SMEs don’t have a strategy?

The general or common problems are a lack of time and knowledge and a shortage of decent tools for them to use beyond Excel. They are consumed with the day to day operations / short term targets and don’t really articulate what success is – I guess the vision – and drive towards that success. I don’t really see much at all in the way of documented business planning and strategy. I’m afraid muddling through is often the order of things and much improvement can, in my opinion, be made.

To those who don’t, what would you say the main benefits are of strategic planning?

Creating the vision for the whole company so that top to bottom all staff have a clear picture of success, what it looks like, how they contribute & their part in that success and how it might benefit them!

What differences do you notice when comparing SMEs with and without a strategy?

I would say they are receptive and very grateful for setting of a plan, with non financial KPI targets to aim for, sales pipeline, new sites in backlog, exciting new product roll outs etc etc. Once one has established an end game and the appropriate valuation attached, they are really excited to drive towards that success and enjoy getting through milestones and delivering results. Of course people really enjoy that and I enjoy seeing it too.

Once they have created a strategy, how often do you suggest SMEs review it?

At least annually, with a quarterly reforecast process. Good practice is tracking KPIs that are reported monthly for early signs of failure and corrective management action, or more positively for outperformance that can be capitalised further upon.

Looking ahead, if you could list the top three recommendations to SME leaders, what would they be?

Firstly to set a realistically ambitious business and financial plan with the Board.

Secondly, I’d say to establish key non-financial measures to target areas of the business against and appraise them of the implications of not meeting these.

Lastly, establish constructively close dialogue across the team and business – communication – in driving towards these goals.

Thanks for your time Roger! 👍

Similar Articles