4 Roles of the Modern Chief Financial Officer (CFO)
The Chief Financial Officer has always been a position of respect in the business world. A financial expert with insight to manage the complete monetary dealings of a business, this position has evolved with technology and time to become a go-to person for any strategic business. What traits make the position vital to business? What traits do aspiring CFOs need?
CEO’s Right-Hand Executive
Today’s CFO is the CEO’s confidant and enthusiastic champion. The individual must be trustworthy and someone with whom the CEO is comfortable sharing everything from strategic ideas to personal-professional struggles.
While the modern CFO shares certain values and ideals with the CEO, he or she must think differently enough to provide an alternative perspective.
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Additionally, the modern CFO lives, breathes and puts into action the CEO’s corporate vision. The individual understands the importance of culture, brand and strategy, and works actively with the team to justify investments. Having an EQ (emotional intelligence) as strong as their IQ, the modern CFO is in tune with the culture of the organization.
Strategic Advisor
The modern CFO is the senior executive team’s on-staff advisor. The person understands, in depth, the market opportunity, strategy and business model of the organization and provides a unique perspective that looks across all departments.
Besides the CEO, the modern CFO is the only person with a clear view of the big picture and limited bias toward one aspect of its performance. To play this advisory role well, the individual is a business executive first and a financial executive second.
CFOs who have exposure to both the finance and accounting sides of the business, as well as strong leadership experience across a range of businesses, are best prepared for the strategic needs of a business.
Disciplined Operator
Today’s CFO provides data, information, insights and puts them into action. The modern CFO understands how to build scalable systems and processes. The individual develops KPIs and understands performance trends, but also develops and implements strategies to improve them.
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To excel, the modern CFO must move away from the financial report card and embrace business insights. To ensure success, today’s CFO must speak the language of business and understand that the key drivers of business are often significantly more than what shows up on the balance sheet.
Innovative Technologist
It should be noted that tomorrow’s CFO drives innovative technology solutions in support of the business. Tomorrow’s CFO embraces the “product mindset” that products need to be engaging, delightful to use, deliver the stated business outcome and continually evolve.
An educated consumer of technology, tomorrow’s CFO pushes the envelope, demanding creative solutions that empower employees. They are dangerous enough to know what to ask for and educated enough to know what is possible.
Conclusion
All in all, the CFO of today and tomorrow needs ten major traits that help to modernize the role.
1. Honest, trustworthy and high in integrity
2. Strategic minded with ability to understand all aspects of the business
3. Proactive
4. Analytical
5. Collaborative, team oriented
6. Ability to communicate well with all level of employees (orally and written).
7. Effectively coach and mentor others
8. Decision making ability
9. Solid understanding of GAAP and corporate taxes but not a technician
10. Strong financial generalist/multi-disciplined
Of course, there are legal, regulatory and financial items that are necessary for today’s CFO to understand, but the modern CFO is, above all, a leader.
He or she knows how to manage the status quo while always pushing the organization forward. The modern CFO demonstrates this first and foremost in the evolution of his or her own role.
This is what makes the modern Chief Financial Officer not only a valuable commodity to a strategic organization, but also a person that is hard to find without the right resources. The Overture Group would like to thank Entrepreneur Magazine author David DeWolf for his article, “How CFOs Have Evolved from Bookkeeping to Corporate Leaders.”
As an executive search firm that specializes in the placement of financial executives, we are pleased to share this news with anyone aspiring to take the leap to the C-Suite or anyone seeking to find the right Chief Financial Officer for their business. Find your next CFO with us! Contact us to see what we can do for you.