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  • Writer's pictureThomas Watson

Become a better CFO

All great CEOs want a CFO who will help them drive results. They are looking for what I call an “operating” CFO, that is, someone who will get involved in the business and positively influence outcomes. 

Some CFO mistakenly view their role too narrowly. They think their job is just to accurately report results. That is important, and a core part of the job, but insufficient. To become a more effective and valuable CFO you’ve got to broaden your focus.

When I conduct a CFO search for our clients, I am looking for someone who sees their role as being responsible (alongside the CEO) for delivering outperformance. I want to hear multiple, concrete examples in the interview of how the CFO candidate identified an issue or opportunity early, took action, and drove a superior outcome. I’m listening for what the CFO did specifically and probing to assess if he or she was just along for the ride or was actually in the forefront of steering the initiative and persevered.

In particular, I’m looking for six things … and so are the CEOs and board members who will ultimately be speaking with those candidates that make it past my screening. If you’re not doing these things today, make a shift and take your game up a notch. 

  • Vision & Strategy. It’s always important to start with the big picture & continually reevaluate the articulated direction of the company. The vision and strategy of many companies are stale and in need of extensive change. The right strategy will guide where you spend your time and how you make resource allocation decisions. So, before you jump to tactical actions to improve performance - stop - and consider whether changes are needed to the strategy. Raise thoughtful adjustments to your CEO and lock arms in a collaborative partnership.

  • Management Process. I haven’t stepped into a company yet, in any capacity (as an executive or consultant), that had a comprehensive management process in place running at full tilt. Get to work on putting new processes and practices in place. Note: If you haven’t been trained in establishing and operating a comprehensive management process see the Contact Us page. 

  • Your Finance Team. It’s important to make sure your own house is in order. Look at your organization with a critical eye before you start poking into other areas of the business. This will serve you well in the future as you assert yourself in driving change across the business. Consider where your peers would place your team members in a blinded 9 Block review relative to their performance, and make the personnel changes necessary.

  • Impact revenues, not just expenses. The most effective CFOs are more concerned about growth initiatives than how to squeeze expenses. In fact, myopically dealing with just the expense side of the P&L will lead to reduced long-term company performance. Your job is to proactively determine well-placed bets, and support and fund critical investments.

  • Bond with the CHRO. One of your closest professional relationships should be with your company’s Human Resource leader. You’ll need their support and backing in the role of “change agent”; there will be people who challenge or even try to undercut you.

  • Show your emotional intelligence (EI). You may well be the smartest person on the executive team, but you have got to exhibit interpersonal skills and maintain working relationships. It is extremely important to solicit input, genuinely listen to your peers, and partner with them in making changes. If you impose your positional power over and over you will eventually find yourself outside the organization. In coaching hard-charging CFOs and other executives I often say, “just because you’re right, doesn’t mean you win.” 

Keep in mind, all six are necessary, miss one and you’re missing the mark. 

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