The Evolving Role of the CFO: Beyond Numbers and Budgets

CFO. Chief Financial Officer. Not widely popular, as many folks still think of the stereotypical CFO. The "traditional" CFO, who had a very narrow view in their role as a financial expert. Someone who focused solely on the financial aspects of the organization. Relegated to budgets, and financial statement production. And ensuring compliance with financial reporting regulations. Sitting in a board room on the 41st floor, behind closed doors, inaccessible and shrouded by a cloak of mystery.

Oh, how times have changed. Over the years, the role has evolved tremendously. To be successful in today's market, a CFO has to take a strategic, holistic approach to their role. Obviously, there is still a focus on financial operations, but it's no longer the sole focus. Instead, today's CFO must operate as an integral partner and facilitator, proactively supporting the business's growth and prosperity, taking an extremely active role in driving the success of the overall business.

More than Finance?

More than FP&A, Financial Statements, Treasury Management, Internal Controls, and M&A? More than Tax and GAAP?! What on earth do you mean?! I'm so glad you asked.

Strategic Planning

CFOs are increasingly involved in the development and implementation of an organization's strategic plan. Using their financial expertise, they are able to provide valuable insights and recommendations to support the company's long term goals and objectives.

Communication and Collaboration

Believe it or not, some CFOs have quite the way with words. And are great relationship builders. A winning combination when it comes to facilitating communication between various departments and stakeholders, ensuring understanding and alignment throughout while promoting a culture of teamwork and collaboration essential for success.

Risk Management

This is a fun one. In today's continually shifting regulatory environment, risks are plentiful and ever present. CFOs, many of whom are naturally inclined to prepare for WCS (worst case scenario) help identify and manage risks to the organization, ensuring the company is well prepared for potential challenges, and is properly outfitted with corresponding contingency plans. Just in case.

Decision Making

That pesky financial expertise gives CFOs a unique understanding of the business, and a keen ability to access and metabolize key metrics, allowing them to provide valuable insights to support informed decision making, ensuring decisions are made objectively, based on facts and not feelings.

Strategic Advisor

The CFO works closely with key leaders throughout the organization, providing financial insights, advice, and support, ensuring resources are being used effectively to support the organization's strategic decision making while accomplishing its goals and objectives.

Technology

The connection might not be immediately obvious. But, appropriately leveraging technology is paramount to an organization's success. Without it, an organization may be hard pressed to build a scalable, sustainable infrastructure. Responsibly deploying technology, and corresponding automations, allow an organization to carefully manage its cost structure, compressing expenses while growing revenue, ultimately optimizing profits and margin.

Conclusion

So there you have it. Today's CFO still loves numbers. That's a given. But to truly be successful, they must also be an integral partner. A strategic advisor. A facilitator. And they must play a critical role in supporting the overall success of the organization. And absolutely nothing less.