As most of us are painfully aware, the U.S. economy has experienced one of the slowest economic periods in recent history. Businesses are worried, consumers are cautious, and investors are downright jittery. I have been speaking with several of my friends as well as our clients and prospects about the impact of these conditions on Finance and Accounting organizations. The good news – the demand is pretty steady – in good times or bad, solid finance and accounting professionals are in high demand. The bigger picture we began to ponder is – how have events and conditions changed what is needed from today’s executives and from those who are up and coming? It is really quite amazing to think about all the things that have impacted this profession just over the last 10years. The thinking and demands on the finance and accounting professionals have been significantly reshaped
We asked a couple high profile CFO’s to weigh in on what they feel the job calls for today and tomorrow and we thought you might enjoy their perspectives.
When you consider what makes for a strong CFO, what comes to mind? According to Ron Domanico, senior vice president and CFO at HD Supply, Inc. in Atlanta, not only are today’s CFOs facing increased global awareness issues, but they are surrounded by greater regulatory uncertainty in the areas of taxes, healthcare, governance, EHS, customs, and national security.
In fact, today’s CFO requires a diverse skill far beyond what has ever been required before. CFO’s need a wealth of knowledge about many businesses and industries, including best practices that can maximize efficiency and profitability. “They are more of a strategic partner with the CEO, sharing a division of responsibilities,” Domanico says. Many companies have completed upgrading all their transactional and information systems, so a strong business mindset is needed – capable of processing that information for those on the front line.
Because the CFO you choose will be handling important and sensitive facets of your business, it is inherent that selecting a CFO be taken with great thought and deliberation.
“It goes without saying that a CFO must have impeccable integrity and they must possess very strong communication and analytical skills,” says Mark Bachmann, executive vice president and CFO at Zep, Inc. “The individual should have been exposed to multiple companies and/or industries and ideally had an operating or line management role.” It is difficult to have a firm grasp of best practice perspective based on just one practice.
Bachmann adds that CFOs need to be viewed as broad business executives capable of advising on long-term strategy and short-term operations. “It is far more than someone who is a strong, technically competent controller,” Bachmann says. “Clearly today’s CFO is facing much more regulatory pressure and demand for results in a fast-changing environment that has accelerated with technology.”
Domanico agrees. “A CFO needs to have refinancing and restructuring skills and have an intense focus on liquidity, cash flow, debt levels, and maturity. And they need to have more investor relations and public relations responsibilities.”
Of course, wearing additional hats can be challenging to players within the CFO field. Industry rules keep changing so keeping abreast of those changes can be challenging, especially when you are assisting with many more facets of a business. Access to information and extensive personal networks is critical to staying on top of the game.
“Integrity is a must,” Domanico says. “The CFO candidate should be a great communicator, provide excellent collaboration skills, be customer focused and highly confident, yet humble.”
It’s evident that the education and experience of CFOs provide them with superior analytical and cognitive skills that enable them to identify issues and opportunities in a wide variety of situations. Experts agree that these skills have placed CFOs in positions of influence and authority that shape critical business decisions.
The CFO profession has been operating more than ever under a magnifying glass, with regulators, politicians, and journalists looking for the next case of balance sheet gimmickry or bogus income statements. This situation has kept many otherwise strong financial leaders on roller skates; always having to look over their shoulder.
As a profession, we need to be working daily to reverse that trend. Let’s not allow the crucial compliance and/or transaction processing component (the “busyness” of the job) detract from the value the office of the CFO brings to the business – at any stage in its lifecycle.