8 Skills CFOs Will Need, To Be Successful In Future
Smart companies today seek employees who are willing to get out of their comfort zone and add value to the company by going beyond their resumes. The role of a Chief Financial Officer is also gradually changing.
The CFO of today are expected to think and do much more than simply devising strategies, analyzing reports, and crunching numbers. They are expected to be managing HR, understand technological influences on businesses, and be the public face on the finance front.
Here are 8 skills that future CFOs will need to be successful:
1) Adapting to New Technology
We are now moving towards a phase where technology is revolutionizing the world.
From Internet of Things to Big data a number of technologies have shaped the world we live in, and there is still a lot to come. Even though many of the CFOs today rely on traditional tools and methods such as ROI, ROC, payback period, etc. soon they would be required to understand modern technologies and bring changes in the company by using analytics.
Modern CFOs will compare the technologies that are available and pick the suitable ones for their businesses. They will also hire the right talent for incorporating the technologies. All of this will, however, require them to have a basic understanding of the technical front in the first place.
2) People Management
Leadership is also a quality future CFOs would need to succeed. This is because unless they are good at managing people and influencing them they can’t put their technical skills to their best use. Companies want the people on the higher hierarchy to ensure that they have the right people, and the right talent.
CFOs of the future will play a pivotal role in talent acquisition and retention. They will analyze the missing pieces of the companies, and fill the gaps through intervention in the HR department.
3) Incorporating Big Data in Business Operations
Big Data is already big, but it is going to get bigger. In near future it is going to impact businesses big time, whether they want it or not. Thus, CFOs should be prepared to handle the pressure.
Now is as good time as any to start familiarizing oneself with the aspects of Big Data, and foresee its impact in the near future. When a number of business operations will be carried out on the basis of information collected though Big Data then it is crucial that CFOs understand the relevant tools and technologies when making financial decisions for the company.
The CFOs of today have started to get their share of responsibilities pertaining to communications. They have to announce financial results to different kinds of audiences that include board of directors, media, analysts, and other stakeholders. In fact, the role of CFOs in communication has been increasing day by day. Modern CFOs should be thus prepared to become the financial faces of their companies. They should be able to handle the pressure the responsibility brings.
5) Risk Management
One of the major roles of future CFOs will be risk management. This is because as new technologies are emerging rapidly businesses are getting affected. Economy has become unpredictable, and it is going to stay that way for a long time. With uncertainty comes risks, and this is where CFOs will extend their support. They will stand beside the CEOs and help them in navigating though the risks and tackle developing issues head-on. They will be always on the lookout for emerging problems and nip them in the bud.
6) Strategy Developer
Businesses will face a myriad of challenges in the future. When the convergence of NextGen technologies is at its peak, there is going to be a lot of confusion and the dynamics of the market will change considerably.
The CFOs will then step ahead and take an extended role- one that involves developing strategies and making important decisions. CFOs will have their say in technological and real estate investments. In fact, even today successful CFOs greatly influence the decisions made in the companies.
Successful CFOs of the future will be able to develop and alter strategies for business expansion and profit maximization. They will understand the business needs and prioritize the resources. Their role, will be thus in line with the CEOs.
7) Making Decisions Based on Analytics Received From Third-Party Companies
A lot of companies outsource the analytics component of the business. This is not really a bad thing to do since there are a lot of companies which are solely focused on analytics, and thus are quite good at it. However, there is a problem still, for in most cases the power of decision-making is also left with these companies. This is not the best approach.
Granted that they understand analytics better and can surely form an opinion on what should be done next, but the best decisions can only be made by the parent companies themselves. Future CFOs, will thus analyze the data and make the decisions for their companies. They will be on top of the analytics and form well-informed and thought-out decisions.
8) Understanding Non-Financial Information and Business Drivers That Affect Fiscals Matters
CFOs must be able to understand how non-financial factors are driving their companies. For instance, intellectual property and intangible assets are becoming more and more important, and without their understanding a CFO can’t make the best decisions.
Most CFOs are used to limiting their focus to balance sheets, while the reality is that when the valuation of a company is done today then only 80% of the value is accounted for the tangible items. The other 20% percent belongs to the intangible items such as the reputation of the company, brand recognition, etc. Thus, to make sound decisions a CFO should be able to take everything into account.
Gone are the days the roles of individual employees were limited. The companies of today seek talented individuals who can wear many hats. Whether it is the CRM, IT, or the HR, the need of versatility is everywhere. The CFOs are also catching on the demand, and thus adjusting accordingly.