?? Modern Qualities a CFO Must Have

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By The Finance Weekly | January 18

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Here are the key points from the article:

The CFO role traditionally focuses on financial management and accounting. However, modern CFOs are forward-thinking leaders involved in strategic planning and overall company operations, evolving beyond traditional financial responsibilities.

9 characteristics that delineate an accomplished CFO:

1. Role Clarity?

Role clarity is crucial for successful CFOs who embrace a forward-thinking approach, play a leadership role, and provide strategic guidance to the CEO. Building a strong relationship with the CEO is vital, with CFOs viewed as co-pilots guiding the business through changes and transitions.

2. Creating a Strong Team?

For the success of the company, a good CFO prioritizes building a strong team with a focus on adaptability and continuous learning. Surrounding oneself with individuals who are forward-thinking, embrace new technologies, and generate valuable insights is crucial for achieving organizational goals.

3. Constantly Accommodating your Communication Style?

Successful CFOs excel in communication, adapting their style based on the audience. Transparency is vital, especially with Private Equity firms. They prioritize open, frequent, and concise communication, addressing issues promptly to avoid surprises. Confidence in conveying information and tailoring communication to different stakeholders are crucial skills for CFOs.

4. An Environment Built on Trust?

Building connections and trust is vital for successful leadership, with CFOs advised to prioritize relationships alongside financial metrics. Maintaining an open door policy, actively listening to employees, and valuing their input are key strategies for CFOs. By fostering open communication and emphasizing the importance of each team member, CFOs can enhance their leadership effectiveness beyond financial responsibilities.

5. Get Involved in All Aspects Of Your Business?

Great CFOs stand out by actively engaging in corporate issues, client interactions, and challenging the status quo. They prioritize dialogue, anticipate challenges, offer constructive feedback, and implement solutions effectively. Proactive, adaptable, and deeply involved in internal processes, they go beyond routine tasks to drive positive change within the company.

6. Be Ready for Change?

Dedicated CFOs anticipate change by balancing long and short-term goals, advocating for flexibility, and prioritizing frequent information updates over rigid forecasting. Embracing agility in decision-making enables proactive responses to changes and the seizing of new opportunities as they arise.

7. Improving Profits and Cash Flow?

CEOs expect the accounting department to control finances, while CFOs fuel company growth through profits. CFOs should see themselves as revenue drivers like top salespeople, not just number crunchers.

8. Let the Controller Do it’s Thing

The CFO focuses on the future and strategic planning, advising stakeholders and driving the company forward, while the Controller is more involved in day-to-day financial operations and looking at past performance.

Understanding the Right Time for Acquisitions and Developments

Companies typically grow organically, build new capabilities, or make acquisitions. CFOs play a crucial role in helping companies decide between buying and building. Organic growth is preferred when new skills align with the business foundation, but acquisitions become attractive when in-house development is costly or time-consuming. It's essential to focus on acquiring capabilities rather than market share and avoid trophy acquisitions. CFOs must assess the financial implications and risks of each growth opportunity, acting as neutral arbitrators in decision-making.

Conclusion

In conclusion, the CFO role has evolved significantly, with a focus on incorporating the mentioned 10 qualities to excel as a successful modern CFO.

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