The position of CFO has always been one that requires a great deal of knowledge and foresight. Managing the risks of a corporation brings with it a great deal of responsibility. Trustworthiness is vital for a CFO to be successful, just as much as cool headedness and a history of wise financial decisions.
Unfortunately, it’s hard to make comparisons between CFOs. The position has become more and more varied as global business develops and companies change their employees’ priorities. CFOs are increasingly taking on tasks that are beyond the financial aspects they originally covered. They are increasingly becoming more important as CEOs rely on their advice on a wide variety of topics.
There is an article on Inc.com which covers the top 3 priorities of the best CFOs, and it’s still very relevant today. If you’re looking to see what a CFO should be doing in a nutshell, this is a great piece to read. We’ll cover the three steps right here though.
1. “The CFO as Chief Opportunity Officer”
This is one of the most important priorities that a CFO should focus on. A CFO needs to have a strong team of analysts to ensure there is accurate and trustworthy information available to the company. A quality CFO will use this information to integrate all aspects of management to make the right decisions for future growth opportunities. The CFO needs to be able to engage other areas of management as well as help develop plans once a decision has been made.
2. “The CFO as Chief Investment Officer”
The CFO needs to maintain a keen awareness of the business market and potential investment opportunities that arise throughout the year. They need to be able to gather the appropriate information so that investment and other financial decisions are made with confidence. Choosing the more profitable opportunity versus another can mean the difference between a good CFO and a great one.
3. “The CFO as Chief Metrics Officer”
Providing accurate and recent data about a company means others in management can make the best decisions each day. This is one of the most important day-to-day priorities that a CFO needs to focus on. Not only providing the information, but also helping management to understand it, is just as important. Having discussions about how certain actions and choices made by management influence the metrics of the company will help the company make better decisions motivated by performance and data, not what is thought to be right by management.
The CFO position still requires a great deal of financial work and accounting, but these days a lot of that can be delegated to lower positions. The CFO needs to take a broad, company-wide understanding of the financial picture to truly be a strong influence.
Do you think these priorities are vital for a CFO to focus on in order to provide the most value to his company?