Theme 2011: Future Financial Leaders
In uncertain and turbulent times, strong leadership is of overriding importance for the success of a company. A good leader ensures that his company reacts on time and effectively to the challenges imposed by the market and society. A true leader sets out a clear route to the future and, by his good example and clear communication, knows how to get his staff to accept the necessary changes. He motivates and inspires his staff by placing his confidence in them.
Leadership is not only essential for the top of the company but also for the middle management and for all staff members. Also CFOs can make their mark by demonstrating leadership at the right moment and by ensuring that the strategy of the company is supported by its finances.
The CFO does not obtain this leadership automatically on the basis of hierarchy or his expertise in the field of finance, but by being open to change and contributing to solutions that will satisfy the constantly changing demands of many stakeholders. What does financial leadership signify for the CFO and how does he interpret his role? Is the successful finance manager of the future a change agent with a strong focus on creating value for all the stakeholders?
A world of difference
During the last ten years, the influence and the visibility of the finance professional has increased greatly. The days in which the CFO operated in the shadows and was concerned mainly with traditional tasks such as the budget, accounting and reporting are far behind us. The job of the finance manager has obtained a wide range of aspects. The traditional CFO has been replaced by the CFO who is not only in charge of finance but is also a business partner and, in many cases, holds the position of ‘second in command’ after the CEO.
Influence
Based on his financial knowledge of the company and his involvement in the business, the CFO is well placed to signal in good time not only the risks but also the opportunities. In times of great change, based on his broad knowledge and his role as the conscience of the company, he can assume the financial leadership by having a clear vision of the future and having the active anticipatory attitude needed to make strategic changes possible.
The CFO is expected to have thorough insight into the business, the operational processes and the value drivers and stakeholders behind these. Increasingly, eyes are focussed on the leadership role of the CFO with the initiation and execution of, for example, business reviews and investment decisions concerning such matters as outsourcing and improvements in performance.
It is also the task of the CFO to ensure that the finance department operates smoothly internally so that it can cope with these changes. Processes and systems must be in good order and also the human factor is an important item. Maintaining and keeping up to date the quality of his team and a sound programme for talent development within the financial team is extremely important. The success of the team determines the degree to which talent can be recruited and this has a direct influence on the success of the entire company.
In addition to being a business partner, the CFO is first and foremost the conscience of the company. He is the expert in questions of compliance. The increase in rules and regulations, international legislation and accounting rules places ever greater professional demands on the CFO. In all questions concerning change, it is his task to compare these matters with the rules and regulations and to ensure that the company stays within the legal boundaries.
Success factors?
It would appear that the CFO is the person who increasingly makes the difference. It is time to investigate according to which scenarios the role of the successful CFO will develop further. This includes, in any case, the ability to evaluate, creativity, communicative skills and, last but not least, the leadership qualities of the CFO and his team.