What to expect from the Chief Financial Officer (CFO)?

Chief Financial Officer (CFO) is one of the instrumental role within the executive team of an organization. Successes of the businesses are the success of the top team who bring the whole organization together to the market place and likewise most of the failures are predominantly the failure of the executive team. For a top team to be successful it requires clarity of the vision and a roadmap to get there. Understanding performance and achievements through the journey becomes a compass and business insights become the calibrator and there the role of a CFO becomes vital. Their jobs are not to give veto or endorse any decision there role now needs to be more integral of the decision making process. Less with past more with future and in between managing the present if not day to day.

In short role of the CFO is manage business risk and surprises in the process of creating, communicating and delivering shareholders value. Flags should be raised well ahead of time.

A Foundation

1.??????Finance – Managing finance is the core job of a CFO, finance means money and money attracts lot of focus and CFO’s key role in the business is to minimize risks around finance. Lack of finance may hinder growth and easy access to finance may destroy the business model and perspective. The difference between the money in the business and money in the bank must be understood.

2.??????Catalyst for productivity, profitability, growth and sustainability – CFOs are expected to prepare, translate and interpret?the KPI, Income Statement, Cash Flow, Balance Sheet, Balance Scorecards

3.??????Decision support – CFOs help the organization to set decision criteria in different function of the business in different perspectives. They become more like a translator and connect activities through doing business analysis, scenario evaluations?to ultimate business value creation. Speed and accuracy?becomes critical here, an on time decision making capability is one of the superior competitive advantage. Sometimes it beats innovation if not implemented faster and in right time.

4.??????Protector of trust capital – They would implement a control environment where authorities are delegated with freedom to the competent people within a framework to ensure that all risks are mitigated. Also CFOs need to highlight the value of investor, regulator and customer trust towards the organization and the value of these components.

5.??????Harness the value of intangibles – CFOs need to translate the value of process, brands, motivated work force for a sustainable organization. They should be advocates for the long-term investments.

6.??????Standard Bearers of Business Strategy: CFO’s should be the standard bearers of business strategy, the game plan to win in the completive space or making the competition irrelevant. The highest value could be delivered if the vision is being realized, calibrated and celebrated.

B. Greatness Guide:

Management guru Jim Collins said, “Good is the enemy of great” and it is no exception for any company or function or even a role. Great companies endured the recessions and disruptions and great professionals and executives experienced the same in their life. Greatness endures and goodness perishes as the saying goes “when the going gets tough, the tough gets going”

Greatness always doesn’t require a gigantic task it comes from few discipline practiced over time.

1.??????Great CFO is cash flow focused which captures the essence of Income Statement and Balance Sheet daily, weekly, monthly.

2.??????A great CFO don’t breaks the law, he or she uses the law as a competitive advantage

3.??????A great CFO becomes a translator of difficulty and complexity into simple process or maps. Simplicity is their way of doing things.

4.??????A great CFO don’t only control but become a business advocate

5.??????A great CFO understands not only the time value of money but also the value of right timing.

6.??????A great CFO is not only concern cost of the product but also the cost of not taking decision in right rime.

7.??????a great CFO is more of solution oriented, he or she looks for solution when notice problems.

8.??????A great CFO is value driven, strategy focused and leader first then a manager.

9.??????They harness a partnering mindset instead of a policing mindset.

10.??Great CFO’s keep the basics right even when in the face of overwhelming distractions.

11.??Great CFO’s value talents and create a pipeline through smarter people.

12.??Great CFOs are designers of value.

13.??A great CFO don’t compromise in hiring right talent in the team, they keep a healthy pipeline.

14.??A great CFO turns every cubicle into a cockpit , he or she believes in “if you expect inspect”

15.??Great CFO’s know in an information age you don’t win by a magic formula rather by a set of core competencies that is difficult to build overnight with money only.

16.??Great CFOs are not only Chief Financial officer but also Chief Focused officer, they bring clarity and focus in the organization.

17.??Great CFOs are highly networked individual and they continuously learn and update with new trends

C. Conclusion

Clarity and granularity of a role is fundamental to high performance, we may start early half prepared but if it stops there it becomes dangerous. The reality is that many of the professionals are living dangerously not only in finance but in business. This is not an exhaustive list of all aspects rather it is a wakeup call. I wish a richer fulfilling professional life by becoming a true business partner in the organization.