Steve Jobs. Richard Branson. Jeff Bezos. We’ve witnessed decades of star chief executive officers who became much more than the sum of their parts and went on to bright spotlights. But not so much the humble chief financial officer. Traditionally conservative, risk-averse, and focused on skillfully managing both corporate assets and returns, the CFO has stayed out of the limelight — until now.
The modern CFO is becoming more visible. In the past few years, more finance chiefs have been recruited to take the CEO reigns in uncertain times, and even those who do stay in their roles are experiencing an unprecedented rate of business evolution that’s asking far more of them than ever before.
What, then, should the modern-day CFO look like? What are the most important attributes given the shifting sands of the corporate landscape?
Shelter, But Grow, in Place
We’re entering a new era where the requirements of today’s CFO are ultimately more diverse, complicated, and sweeping. We are expected to not only provide counsel to the CEO but to perform a key role in identifying strategic growth opportunities for the business.
There’s an absolute need for CFOs to evolve in their roles, even if not transitioning into a CEO position. This means adopting a more left-brain right-brain balance where, as numbers people, we can also begin to embrace a more creative, problem solving, and intelligent risk-taking attitude when it’s needed.
A New Investment Mindset
You’ve probably seen the fictional debate between CEO and CFO on LinkedIn. It goes something like this, CFO: What happens if we train our people and they leave? CEO: What happens if we don’t and they stay? This perfectly demonstrates the different mindsets of each C-suite leader with one focused on the bottom line and analyzing every investment, and one on overall performance and operational needs.
The evolved CFO, however, embraces both sides of this argument and adopts a more advanced investment mindset. They will understand the need for fiscal prudency but balance this with a broader perspective on the benefits of investing in people, training and technologies that ultimately deliver against long-term corporate goals.
Maintain the Counterbalance Role
Our natural tendency as CFOs is to practice financial discipline and restraint, but we will fail miserably in today’s climate if that is all we do. Don’t change completely, however.
As CFOs pursue career development, it’s important to offer a counterbalance to the broader executive team by providing a pragmatic and fact-driven approach to problem solving.
The approach should be less emotionally swayed and more data-driven to guide business decision-making. This allows better financial stewardship for the entire organization, and not just the priority business unit of each department head arguing their case for more budget.
Marketing for Business Opportunity
One side effect of rapidly evolving business landscapes is increased opportunity, which all CFOs understand means risk and expense. New business initiatives require companies, effectively, to place bigger bets to drive sales. CFOs must work more closely with chief marketing officers early and often to build alignment between the short-term budget demands mass marketing requires and the long-term financial health of the company.
Our natural tendency as CFOs is to practice financial discipline and restraint, but we will fail miserably in today’s climate if that is all we do.
Measuring ROI on marketing and advertising is not easily accomplished, but a few agencies have developed the methodologies to unlock the ability to prove impact on topline business performance. The new CFO can be an important team member in working with the CMO in agency selection and ongoing management.
Building CEO Foundations
If you are one of those CFOs considering a transition, there are some key steps to being move-ready. The American workplace today is flatter, more collaborative, and less hierarchical than at any time in the past. Business leaders are required to foster creative cultures that skew toward innovation while also shepherding massive industry-wide change through business success.
That’s a tough ask for any CEO, let alone a transitioning CFO. As you begin to design a game plan to tackle both, it’s a good idea to seek input.
CFOs tend to be driven strategically by the data and the data alone, but become more open to the insights of other executives, external CEOs, and even mentors who can help them think from the gut as much as the spreadsheet, enhancing critical intuition skills.
The good news is that the business world is seeking leaders that emulate the core qualities of a successful CEO.
In more unpredictable economic times, adaptable and change-ready executives perform the best. Those CFOs who bring a future-forward perspective and don’t demand to control every aspect of the business themselves can be very successful with their employees, board members, and the business world.
Brent Longval is the chief financial officer at TV advertising agency Marketing Architects. Brent joined Marketing Architects in 2002 and has been instrumental in establishing the agency’s vital financial systems as well as influencing the organization’s direction, growth and long-term planning. Brent can be contacted at [email protected]