What are CEOs and the Board of Directors looking for in the CFO that gets hired today? How does one get chosen for the job, while a long list of other candidates aren't even considered?
These are good questions, and quite frankly, they are highly relevant. Whether or not you are someone who is aspiring for the executive office of the CFO, or you're a CFO looking to become more successful in your own or other organization.
Our University programs and professional designations do a wonderful job at training us in various fields of finance. Accounting, Treasury, Risk Management and the like. However, does that really make us ready to become CFO? Of course not...
In this short blog post, you'll learn the 10 skills you need to become CFO. These skills set top financial executives apart from their peers, and ultimately get them hired for this important role. Ready to learn more? Let's dive into it:
1. Business Understanding
The CEO and Board of Directors want someone in the executive CFOs office who understands the business. For this position, they don't necessarily want a "numbers guy". They already have several people in the organization who do that.
They want somebody who can sit at the boardroom table, and talk about numbers from a business perspective. Here are some examples of how financial numbers impact the business:
- Business Trends
- Business Analysis
- Strategic Management
- Risk Management
Business understanding is a very broad based skill. You must be able to bring this understanding to the boardroom table every time a meeting is called.
2. Communication Skills
The CEO and Board of directors require someone is an expert in communication to come in and fill the role of the CFO.
Communication is a very broad based spectrum that we're required to do these days. Both for internal purposes within the organization, or external purposes with investors. Also, don't forget about government and regulators. The CFO must be able to communicate with anyone that the organization comes into contact with.
As CFO, you need to be someone who can articulate the organization's strategy and message on different levels within and outside of the organization.
3. Relationship Building Skills
Building very strong relationships across your executive team and with your peers goes a long way in being successful as the CFO. Someone who takes initiative to start conversations is considered a valuable asset to the CEO and Board of Directors. Here are some other examples of strong relationship building skills:
- Looking for new and innovative ways to collaborate.
- Recognizing biases and keep an open mind.
- Asking questions and listening to people's responses.
- Offering to help with finance tasks without being asked.
- Learning about others' experiences within and outside of the organization.
Relationship building is the very important process of developing connections for the organization. This skill is fundamental for the modern day CFO to possess, because it very heavily impacts the company's reputation, influence, amount of deals that are closed and sustaining commercial relationships.
4. Finance Team Builder
The CEO and Board of Directors need a CFO who can build and develop a very strong finance team. The finance team must possess all of the skills that were previously mentioned, and guess who will be responsible for ensuring that they have those skills. You guessed it... YOU! The CFO.
A competent CFO that gets hired today should have the capability to make sure they have a wide range of successors within their organization.
5. Executive Presence & Influence
Having executive presence and influence within your organization can't really be described. You have to know it to see it. Ask yourself these questions:
- How are you and your ideas perceived by your peers?
- How about the CEO?
- Do you have the ear of the CEO?
There's no greater compliment than having a CEO that uses your words, or comes to you for advice to communicate the status of something to the Board or an investor group.
As the CFO of an organization, it's your responsibility to map out the companies future strategy. This will require you become a strategic advisor, communicate strategic direction, and drive future business performance all at the same time.
Looking to grow your executive presence within your organization? We have a course just for that... CLICK HERE to enroll in our '6ExY: Mastering Six Traits of Executive You' to learn how to grow your executive presence, and ultimately make it from the cubicle, to the boardroom.
6. Look At Yourself As A Business Partner
At Executive Finance, we believe the CFO needs to be someone who helps managers do their job of running the existing business better. Whether it's by providing analytical support or helping the structure of sales deals. Every great executive should realize the value in having a great CFO strapped to their side when it comes to managing the business.
The CFO brings key perspectives to the table that really can really help managers, some of which include:
- Objective, risk management, and the ability to play devil's advocate.
- Cross functional, entity wide, and the ability to see the bigger picture.
- Financial, bottom line, and funding feasibility.
7. Ability To Innovate
Innovation is really, a mindset. It's not limited to simply developing new products and services. It's a continuous way of thinking to do things better.
Take a look at this quote that we've put into this post by Ted Singeris - President, Mercer Canada:
It's important to open our minds as to what really defines innovation. Here's a chart that clearly states how CFOs tend to innovate in their own respected fields. As you can see, the most common theme for innovative CFOs includes continuously reviewing organization and processes:
Source: FEI Canada: The Funding of Innovation in Canada
8. Strategic Capabilities
Overall, the CEO most often turns to the CFO for strategic planning and advice. Simply because the CFO is the best positioned to consider the full implications of strategy across the organization.
CFOs are expected to play a leading role in these corporate strategies:
- Providing key insight and analysis to support the CEO.
- Leading key initiatives in finance that support the overall strategic goals.
- Ensuring business decisions are grounded in sound financial criteria.
- Funding, enabling and executing strategy set by CEO.
- Developing and defining the overall strategy for the organization.
Yes, there will be a lot on your plate as CFO of the organization. Get used to it. Want to learn how to stay on top of all the continuous learning that will take place on the road to becoming CFO? Checkout our "Why CPD is a MUST HAVE for all CPAs" article by clicking HERE
9. Change Management Skills
For anyone who's been through a change initiative, perhaps implementing a new ERP, or integrating a merger. You'll recognize that the success (or failure) was larger determined by how people were managed during transition.
A little awareness of change management principles can make a huge difference in the outcome of your initiatives.
And Lastly, 10. Be A Credible Leader
Lack of credibility is a barrier to achieving influence. Based on a recent study, here's a diagram that shows the four main traits of a CFO who's a credible leader:
Source: FEI Canada: The Funding of Innovation in Canada
There is so much that can be said about leadership, but it really all boils down to this. Be authentic, adaptable, and take a key interest in the development of employees and the overall organization long term.
In Conclusion, Becoming a CFO:
Hopefully, you've come away with some insights into what modern day CFOs are thinking and doing. For those of you who are being considered for the CFO role, or are new to the job, here are 3 important action items to consider:
- Build a strong finance team around you, and high grade your talent pool.
- Spend time with customers and operations.
- Spend more time with business unit leaders working on strategic management issues.
We have several courses in our library that are value packed with CFO insights and development. To enroll, click below and you will visit our course library. There, you can enroll and earn CPD hours that will go towards your professional development. Thanks for reading!