How can I become a better CFO? 4 traits of a successful CFO
In this article, we’ll cover:
- What makes a great CFO
- Top challenges that today’s CFOs are facing
- How you can become a better CFO
- 4 traits that successful CFOs exhibit, including: they trust the data, they think strategically, they’re quick on their feet, and keep up with the latest technology
- How to build the qualities to become a highly successful CFO
To become a great CFO means fully understanding how much the role has evolved over the last few years – to one with much greater leadership responsibility. Much of this is a result of shifts in business and a need for agile budgeting and forecasting, placing the CFO front and center of strategic decision-making.
While CFOs have traditionally been more backward-looking, this next generation of CFOs now have the data at their fingertips, along with the analytical expertise, to guide the business forward as a strategic advisor to the C-suite.
What are top challenges that today’s CFOs are facing?
CFOs face a number of big challenges; from inflation to fears of recession, rising interest and energy rates, and talent issues. Navigating the future of finance requires CFOs to exercise different styles of leadership to address the specific needs of their organization, whether it is championing innovation, building new processes, or even buckling down on practical next steps.
Given the incredible need for CFOs to flex their leadership muscles, the results of a recent EY survey are surprising
- According to the survey, only 32% of CFOs “always speak up” when they have a differing opinion from their leadership peers.
- Only 30% “always challenge” other members of the executive team when they disagree.
How do I become a better CFO?
As a CFO or finance leader, you know that part of the role is to speak up, challenge others, and drive timely decision-making. But, if you’re struggling with that, it could be because of these three reasons:
- You lack the critical information needed, or you don’t trust your data enough to draw confident insights and make recommendations accordingly.
- You don’t have access to technology that could help, and struggle with manual processes and spreadsheets like Excel that are prone to error.
- You struggle with getting or accessing timely information which hinders decision-making, and impacts what you’re able to communicate to drive strategy and business performance.
There is certainly a gap to bridge with how many CFOs are acting, and what makes a great CFO today, which includes stepping up as a leader, acting as a strategic partner to the CEO, and providing crucial insights that impact the company’s decision-making.
4 traits that we’re seeing in the next generation of great CFOs
Building trust in business data is crucial for CFOs to make informed decisions effectively and confidently. Once CFOs master their data, they’re able to drive innovation and grow the business, turning the finance department into a true profit center.
The problem is that most company data tends to be siloed across multiple systems and collected via manual processes, posing challenges for the finance team to access the information needed to efficiently manage business performance and forecast for the future.
Innovating processes and embracing fully automated FP&A software or a financial performance platform will allow finance teams to have accurate, real-time information at their fingertips to make better decisions.
FP&A software or finance performance platforms also allow for easy data integration to simplify the connection and exchange of data across departments and business systems, providing a single, unified view of the data, so CFOs can fully trust the insights they are gathering.
Over the last couple of years, the C-suite has increasingly relied on the CFO to steer the business in times of economic turbulence. To be successful at this, however, requires a modern mindset.
Great CFOs today are investing more in automation, levelled up forecasting, and collaboration, allowing them to identify significant insights and trends that inform decision-making. This digital transformation propels the CFO into a forward-thinking role, with the ability to see around corners and offer invaluable guidance to the leadership team to help the business prosper.
CFOs are no longer just financial custodians. As the role continues to shift, the finance function requires increased agility. CFOs are required to wear many hats as they oversee risk management, resource allocation and cost control, while also adhering to dynamic financial regulations and emerging ESG mandates.
In a world where business and technology are continuously changing, CFOs can’t afford to sit back and be content with their current processes and systems. Advanced technologies like generative AI have the capacity to significantly enhance efficiency in the field of finance. For instance, the use of AI for anomaly detection empowers financial teams to quickly spot discrepancies that could easily be missed by the human eye, leading to faster, error-free closing processes.
How to build the qualities to become a highly successful CFO
As part of the next generation of CFOs who are dominating today’s workplace, it will be imperative for you and all finance leaders who prioritize data-driven approaches to have the right tools in place for achieving success in their roles.
Our advice for you: lean into data and automation, and approach the CFO role with a tech-driven, agile mindset. Those are crucial tips to build up the confidence to speak up when needed, and drive business decisions as a strategic leader and partner to the C-suite.