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THE CHANGING ROLE OF THE CFO

Reading time: 4 minutes

 

You are the CFO of your organization. There was a time when you were primarily seen as a financial gatekeeper. Your main responsibility was financial recordkeeping and reporting. A focus on financial control and managing the financial process. When analysing data, you were mainly controlling risk and cost. A day-to-day financial focus.

Today it is a whole different story. As the CFO you are co-leading the business. You work closely with the CEO and the board of directors. You are not only managing the financial risks but co-shaping the future. You might even hold the “CEO-in-Waiting” status.

In it’s article “Four faces of the CFO” (link see below), Deloitte LLP mentions not only the CFO taking a seat at the strategy planning table but also puts you in the drivers seat when it comes down to business improvement. Cost reduction. Procurement. Process innovation. Etc. CFOs make a shift from traditional roles as preserving, minimizing risks, getting the numbers right and running effective operations, to shaping the overall strategy and establishing an overall financial mind-set throughout all operations.

You are a financial expert. I am not. I am not going to talk to you about the technical challenges you are facing as a CFO. Not about how to handle the fast-moving digital technologies. Not about innovative business tools or predictive analytics. Not about the use of social media or crowdsourcing. I am not going to talk to you about rising regulatory requirements. Not about how one of your biggest future challenges will no doubt be data-driven insight.

I am an executive Coach. And what I do understand is that your changing role not only asks you to co-develop at a strategic level but also pushes you to challenge the status quo. I know you are working hard to align business and finance. To drive execution. To manage the change. To develop internal and external relationships. To generate more impact. I understand that you are working under bigger pressure. Oh, and did I already mention you are into the spotlight?

You are a CFO. I am a behavioural expert. Where you are probably Blue I am as Yellow as can be (Insights Discovery). I think in big pictures. I am outspoken. I love to be on the main-stage. You could say we are probably looking at the same thing from the complete opposite perspective. And although I am aware of the fact it’s always dangerous to generalize, that’s exactly why I love to work with CFO’s. And where your CFO role is getting more diverse in its responsibilities, there are some non-financial skills you might need to refresh or add to your toolbox in order to continue to excel.

I believe the successful CFO of 2020 is holding the following three skills in his or her toolbox. Three competences that are crucial and that will no doubt make the difference between being a good or great CFO.

 

Interested to do some self-reflection?
Here we go.

 

1. Leadership and stakeholder management

Being a strategic partner to the CEO, you are making a shift from financial Leadership to overall business Leadership. Enhancing your Influence and Impact outside your financial comfort zone will be more important than ever. You will need to understand commercial opportunity and manage internal as well as external stakeholders. Building strong relationships and handle questions with confidence.

 

2. Communication

What I’ve learned to be the most important aspect of communication in your CFO role is the ability to translate detail and complexity into a clear and concise message, especially when dealing with non-financial colleagues. Being too reserved won’t help you either and you will need to be able to speak in front of larger groups. Storytelling. Headline communication. Confidence. Accessible language in and outside the boardroom.

 

3. Delegating

This changing CFO role forces you to focus on the bigger picture. That’s why it is important to be able to effectively delegate the day-to-day running of the finance department to a management team. Being a detail-oriented person, that’s not always an easy thing to do. Letting go of control. Your focus shifts from what to how. You’ll be driving performance instead of numbers. A necessity if you are planning to focus on business transformation and growth.

 

Of course there’s a lot more to say about the three skills above. What I am most curious about is how you experience this changing role yourself. Are we exaggerating? Or do you really feel the impact? And what about the three skills above? Are you working on them? Are there other skills that can be added?

Click here to join the conversation on LinkedIn

If you ask me, the role of CFO is more exciting than ever and I am looking forward to your thoughts. Please don’t hesitate to contact me directly if you have any questions or are looking for a solid and objective external soundboard.

Sofie

 

About the author

Sofie Varrewaere is the founder of BigFish4.me and a certified Marshall Goldsmith Stakeholder Centered Coach. After studying a Master in Psychological and Pedagogical Sciences, she ogled into the magical world of Recruitment, Selection and HR Services. Working for the world leader in HR, she has always been in an advisory role in relation to the larger goals of several multinational organizations. In 2013 she started her own company in International executive Coaching. Doing what she is good at, challenging others as well as herself

Feel free to contact me if you are interested in knowing more about the Marshall Goldsmith Stakeholder Centered Coaching program. It provides a structured approach with clear benefits for the Leader as well as for the stakeholders within the organization. The fact that Coaching efforts are made visible and by consequence measurable, combined with a “No growth, no pay” approach makes it very tangible for the sponsoring organization.

A guaranteed Return on Investment.

Sources
Four faces of the CFO
What will the CFO role look like in 2020?
The CFO’s Changing Role: Growing Challenges Demand New Skills
The Changing Role of the Chief Financial Officer
How energy transformation is shifting the CFO focus

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