THE WORLD of the finance professional has changed significantly over the years as businesses are counting more and more on us to be a strategic partner, setting the direction of the business and working across all areas to support the CEO.
Demands in business have also changed. In the digital age businesses need to be more agile and pro-active in their nature and this is leading to bigger demands and faster evolution of the Finance function. Whether it’s new products or services, new pricing structures, process changes or restructuring the planning usually starts in finance and ripples across the rest of the organisation.
With this in mind and my experience to date, aspiring finance professionals and CFOs need to develop the following areas to thrive.
With finance and CFO roles becoming more and more embedded in the operations of business and externally focused it is important to develop relationships right across the organisation. As an aspiring CFO you should be looking at what you can learn from the COO not only to build up your relationships, but also to learn about the end-to-end supply chain of your business. It’s important to understand the major risks and what keeps them awake at night so you can understand how this impacts the financial results of the organisation.
During my time at Barclaycard I reviewed business cases relating to strategic investments aimed at improving the bank’s operational processes and customer services.
Understanding the detailed nuts and bolts of all the cost drivers, capacity forecasting and scenario analysis allowed me to getting under the skin of the financials and challenge the plan. This gave me a much greater understanding of how the operations impacted the financials. This early experience helped my develop an inquisitive mind and has served my through the rest of my career in other organisations when reviewing operational plans of a business.
On the flip side, it’s also important to work with the CEO and understand the bigger picture and strategic direction of the business. You need to learn as much as possible about the detail of the day-to-day operations, while understanding the longer term visions of the business and the strategic opportunities you will be driving. This puts the partnership of the CEO and CFO in a strong position to serve the shareholders of the organisation.
Become a Strong Leader
The biggest difference between a strong finance partner and CFO is, all of a sudden, you are responsible for everything. This can be a challenge to begin with but you become comfortable with this in time.
No matter what size of organisation you work in, you cannot succeed without developing good people. The people you work with each day will be at the heart of your success and you must look after and support them through their careers.
Building a strong team around you gives you the room to work away from the back office and focus on external meetings – driving commercial negotiations and building client relationships.
Moving into a CFO role means you not only become the finance leader but also play a large role in driving the overall company culture, visions and values. At Klood I also head up the HR function and it’s great to be involved in the people and culture side of the business. It’s not uncommon for this to sit under the CFO remit so it’s worth learning about – and being open to – the fundamentals of HR as well as finance.
As finance professionals we tend to be trained and hard-wired to be prudent, risk adverse and challenge the business. However, at CFO level you need to develop the ability to see things through different perspectives and present information in various ways to multiple stakeholders.
For example, in a single day you may be required to discuss short term risks with the board in the morning, followed by an investor lunch where you will be discussing the projections and aspirations of the businesses and then delivering an inspiring message to the staff in the afternoon about where the organisation is heading. You have to have the ability to change your approach swiftly and be able to work effectively across these audiences.
From my own experience there is a much higher intensity of this in a small business. Since joining Klood in a start-up environment, it’s been a daily balancing act of having strict controls on the short-term working capital requirements, while being creative and open-minded about the income forecast and strategy of the next five years. It’s certainly an exciting position to be in.
CFOs often find themselves at the heart of decision-making and need to be decisive. However, many business issues are complex and it’s important to listen to all the views from the senior management team before making big decisions.
There will be days when things go wrong and decisions need to be made that the CFO is responsible for. It is important to have integrity and develop confidence so this does not becoming overwhelming.
Finance professionals and CFO roles are acquiring more and more gravitas in organisations. Whether you are rallying the troops and inspiring people internally or acting as ambassador of the brand to an external client, it is important to continually develop and strive to be excellent at communication. Communication is becoming a bigger part of our roles and we need to become quick thinkers and practice speaking well, off-the-cuff and deliver high quality presentations.
There are a number of ways to practice this and over recent years I have thrown myself into speaking to groups, attending networking events and linking up with a variety of people. Toastmasters is a great way to practice your speaking skills. I attend the Eldergate club in Milton Keynes every two weeks and was warmly welcomed from day one. It’s been a very large part of my development in speaking to groups and selling key messages.
Overall, both CFO roles and CFOs themselves are all very different in nature and you are always on a journey. Different environments suit different people too. From my personal experience the road to a CFO position has been challenging and varied but thoroughly rewarding.
Having worked in both small and large businesses I feel I have found my place leading and managing the finance function in a start-up business. Despite the risks, I have found the role a lot more fulfilling with the opportunity to drive and have exposure to every aspect of the organisation.
As entrepreneur and motivational speaker Jim Rohn said: “If you are not willing to risk the usual, you will have to settle for the ordinary.”