4 Key Traits for Today’s CFO
When I was interviewing for my current position as the chief financial officer (CFO) of Girl Scouts Nation’s Capital, mentors encouraged me to highlight how I would be a partner to the CEO in driving strategy for the organization. Additionally, in preparing for my interview, I began reading about what makes a CFO successful in today’s complex and ever-changing business environment. In my reading, I learned that the role of the CFO has not only evolved but expanded in scope with increased responsibilities. The role requires new skills, knowledge and expertise. The words strategic, collaborative, communicator, data-driven and future thinking were themes I consistently read of what it takes to be an impactful CFO.
Today’s CFOs must not only look backward and report on past financial results, but they also must be able to look around corners to steer the organization. CFOs are anticipatory and should be well-versed in soft and hard trends and how they impact and shape their organization, competitors and industry. In addition, CFOs must help their finance teams and organization adapt to change, whether it is entering a new market, adopting a new regulation or addressing social issues raised by investors and activists. Furthermore, agility is essential for CFOs. As the pace of change for business has accelerated, organizations’ ability to pivot and address the needs of stakeholders is critical. Finally, CFOs need to align the C-suite and organization to have a unified vision on how to move their organization forward.
Collaborative Business Driver
CFOs are CEOs’ co-pilots in shaping and executing an organization’s strategic vision; with that, CFOs must understand how the organization operates financially and operationally. CFOs are value creators who build sustainable growth for their organizations. They are partners to the entire C-suite in driving business performance through operational excellence. They do this by having a voice in challenging the C-suite’s assumptions and pushing them to think beyond the status quo. CFOs play this role by bringing financial insight and data to flesh out new ideas and initiatives, and they build bridges to ensure alignment and commitment to achieving overall business goals. Thus, making data-driven decisions is essential to driving business growth.
An organization’s most valuable asset beyond its employees is its data. Being able to capture and synthesize its data will propel an organization forward. Organizations that harness their data will differentiate themselves and make critical business decisions that drive transformation. CFOs will lead their organization down the path of this transformation with increased data literacy, implementing controls to ensure data accuracy and completeness, collaborating with data experts, and garnering the entire organization’s support. It must be said that capturing and analyzing data is essential, but the ability to communicate what the data means is more important.
Being able to tell a story of numbers is a critical skill for CFOs. CFOs understand how their organization’s strategy impacts its stakeholders; thus, effectively communicating financial results and strategy effectively to stakeholders is essential in this role. Connecting financial data to strategy is a valuable tool as CFOs must deliver financial information to stakeholders on what it means for future growth and performance of the organization. When communicating, CFOs should speak succinctly and with transparency using a regular cadence that will provide assurance to stakeholders, which is especially important during these disruptive, uncertain and chaotic times. Being a strategic communicator is vital for building credibility for the finance function and the organization.
Today’s rapidly changing, complex business environment has presented many challenges to CFOs and thus has changed their areas of focus and priority. As a result, CFOs have more influence on their organizations’ direction. The role of the CFO is one of being an impactful, collaborative and data-driven communicator who navigates the organization to the future of success.