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Financial controllers' priorities are expected to swing away from technical to HR concerns over the next five years.
Eila Rana, CFO Europe Magazine
May 5, 2008
There are three things that CFOs want from their financial controllers: technical knowledge, good organisational and planning skills, and excellent leadership. But that's not so easy. One CFO recalls how he quickly realised after arriving at his new firm that he had inherited a controller who ticked the first two boxes but not the third. It was one of the main reasons, he reckoned, that morale among the controller's team was so low that internal audit had given the department a "red" rating, a way of flagging unsatisfactory performance to company executives. At that point, finance staffers began opening up, telling the CFO that they felt they weren't getting recognition for their hard work and there was no link between their development plans and the group's business strategy.
Finding technically competent controllers with good people skills is an increasingly acute problem. The CFO says it was "quite a shock" to discover just how rare a breed they are.
New research from Ernst & Young claims controllers' challenges over the next five years will swing from technical to HR issues. Controllers contacted for the research said their top priorities over the past five years, in order of importance, have been recruiting skilled finance people, keeping on top of legal and technical changes, and meeting increasing demands for data. Over the next five years, however, the number two priority will be "improving the profile of the finance function within the business," displacing more technical concerns.
Jon Stanton, the Ernst & Young partner who led the research, says the swing to people issues isn't all that surprising. "The role of the CFO has broadened over the last few years, therefore the role of the controller has broadened," he says. "It's important for CFOs to delegate more and bring in people to help them be effective."
That's what the CFO did. "I realised the financial controller didn't have the right leadership strengths [so] I had to move him out of the organisation and get someone else in." In a matter of months — and after one-to-one meetings, away days and improved two-way communication — the department raised its game and won a coveted "green/amber" rating, signalling a smooth ride ahead.