Despite their bean-counting reputation, the role of Chief Financial Officer (CFO) has moved on from focusing solely on financial performance, and now holds an influential seat on the board – often operating as right-hand to the CEO.
The modern CFO supports the execution of an organisation’s operating plan and strategy, and figures out how best to use the organisation’s resources to deliver for their customers.
In fact, many CFOs are now making the transition to CEO. Traditionally, the role of CEO was reserved for people from a sales, marketing or operational background, but organisations like ASOS and Restaurant Brands International have proven that the role CFO is a viable route to the very top.
If you have your heart set on becoming a CFO, you’ll need to demonstrate a range of expertise, including:
- Wide-ranging financial experience – from budgeting and analysis to compliance and risk management
- Experience leading teams across multiple finance disciplines
- A strong knowledge of best practices across sales operations, strategic planning and customer service
- Excellent business acumen, with strong reasoning and problem-solving skills.
However, these are just the basic requirements; to be a truly effective CFO in today’s rapidly changing business environment, you also need to…
As anyone in the accounting or financial services sector will no doubt be aware, technological innovation is having an immense impact on the day-to-day functioning of finance departments across the globe.
With new cloud-based financial solutions, Software as a Service and big data analysis all changing business as usual, it’s now the responsibility of the CFO to understand all the pros and cons of this new technology.
That being said, there’s huge opportunity for finance departments to make a real difference. With access to data and analytics, it’s now possible to make decisions that were previously made based on gut feeling or experience – now everything from marketing campaigns to financial investments are able to be influenced by data.
Become a strategist.
The CFO has always held the keys to shed-loads of data – but the modern CFO needs to take this a step further by using this information to drive decision-making and align business strategies within the organisation.
As CFO, it’s your job to ensure that the CEO and board's decisions are financially sound, both in regards to resources available and regulatory compliance. That’s why individuals with strong financial experience are far better prepared to make these types of judgment calls.
But, in order to add real value, a successful CFO also needs to be business savvy and have an in-depth understanding of the different aspects, departments and functions within their organisation.
One of the most important traits of any good leader is communication, and the CFO is no exception. Sure, you might have the capability to create a powerful strategy that helps the business meet its objectives, but you’ll need to be able to articulate these ideas to non-finance experts to get things off the ground.
Build balanced teams.
The finance function is shifting away from its traditional accounting roots and broadening its skillset. In order to lead a successful team or teams, the CFO needs to invest in people with an agile, collaborative and entrepreneurial mindset.
According to recent research by EY, 52% of CFOs cannot focus on strategic priorities by delegating responsibilities because of lack of necessary skills in the finance team.
By investing in a diverse and multi-disciplined team, the CFO can strengthen the finance department’s position within the overall business and work alongside a broader range of other departments to add real value.
While the role of CFO is more challenging than ever, agile and ambitious business leaders that are willing to embrace new approaches and invest in new ideas will do doubt be a huge success.