The role of the CFO has undergone a sea change in the last ten to twenty years. Previously, the role was solely financial focused. Today, we need to be stewards, caregivers, strategists, change agents and salespeople. We went from being introverts to providing transparent leadership, being a corporate spokesman, and needing to build strong, diverse teams. The CFO is now the ‘go-to’ person for the CEO or other C-level executives to provide a 360-degree view of the real health of the business. CFOs are looked at to create value in the organization.
The evolution of the CFO has been pushed forward by financial scandals requiring the CFO to assume a larger role in corporate governance and stakeholder relations. In addition, many companies are coming to the realization that other than the CEO, the CFO is the only other executive with a clear view of the big picture, access to relevant data, knowledge of the business, and its outlook and operations. In addition, successful CFOs today retain the ability to provide guidance on strategy, risk mitigation, and regulatory and operational impacts.
In order for CFOs to be successful in this new environment, above all else we will need to be collaborative. We will need to be the solution provider accomplishing the business objectives while mitigating risks. We can no longer be the “no” person. We will need to use influence to help build strategy and culture, and to help drive operational efficiencies to achieve enhanced business performance that satisfies business goals. These skills will help to support the CEO and company from a strategic and financial lens and will also demonstrate to other corporate stakeholders that these plans are worth investing in and pursuing. This will need to be done by changing the language to be about business plans and key performance indicators rather than financial statements.
The ubiquity of big data can also fall into the CFO’s lap as analytics turns data into decision-making power. Analytics will not only encompass obtaining information, but also finding the means to manage and make sense out of that information. Who better to understand and know how to apply the data to business than the CFO? The CFO now has the need to evolve from looking in the rearview mirror to being proactive and influencing and accelerating decision-making through analytics.
I firmly believe that in the next five to ten years, successful CFOs will be those who become technologists. We need to become more innovative, and we need to approach our tools and technologies with a “product mindset.” I believe such a product mindset – which in a nutshell is the idea that products should be engaging, innovative, deliver the stated business outcome, and iteratively improved upon – is not just restricted to the world of software development. It can and should be adapted by other business functions. As forward-looking CFOs, we need to look at best practices not just from other industries, but other functions as well in order to develop cutting edge business optimizations and financial visibility to help drive the growth of our companies.
Today’s CFO will likely need to juggle between traditional roles like providing financial analysis, and the need to venture into newer roles such as analyzing business processes, talent management, and transforming cultures. At 3Pillar, that is exactly what we are doing. The culture comes from the top. Our CEO, David DeWolf, has done a fabulous job building a great culture. The CFO’s job is to help push that culture forward. We are now looking at fostering global best practices within talent management so that team members, regardless of which location they are in around the globe, have similar experiences and opportunity for career investment and advancement.
CFOs are now expected to be more than just an accountant. They are expected to drive business fundamentals and value creation through leadership skills, strategic thinking, and the ability to work collaboratively across teams and stakeholders. The CFO has been elevated from the back-office role to one that is critical to the success of both the CEO and the company as a whole.