Much has been written about the ever-increasing influence that chief financial officers have in any organization, but it’s only in today’s hyper-competitive economy in which that influence has been defined. Essentially, the role of the CFO is expanding to include more management responsibilities beyond the parameters of finance. In fact, in various industries such as credit unions, up to 64% of new CEOs were once CFOs in their industry.
So what exactly does this mean? While CFOs must balance the duties of their position alongside greater involvement of management, they should also consider fundamental philosophies that shape their roles and the future of their careers.
Understanding the Route Forward: From CFO to the Top
The latest research shows that in both the United States and the United Kingdom, the vast majority of CEOs have a strong background in finance. After all, this makes sense, as the role of the CEO incorporates governance issues with financial management. This is exactly why chief financial officers who more ably display “soft skills” that reflect leadership have an easier time advancing their careers, should they want to move into larger management positions.
To advance your career, it’s vital to understand the largest challenges hindering CFOs today. The most recent surveys reveal that CFOs are most hindered by:
- The economy. Nearly 37% of all CFOs surveyed said that the economy was their largest hindrance. Rarely do events unfold in such a way that would be ideal for any particular business, so CFOs must be ready to tackle a situation in any environment, with any variables. Being able to work with elements beyond your control as a financial strategist only boosts your management credentials.
- Shortage of time. Management, investors, employees, and other vital entities demand results, and they demand them quickly. If a CFO is cracking under the pressure of his or her responsibilities, then how much more challenging would the top management position be?
- Weak internal collaboration. Financial strategies affect every department in an organization, so CFOs must be able to communicate effectively with all team members – which is a hallmark of any successful CEO!