The work challenge keeping CFOs up at night
As the role of the chief financial officer (CFO) evolves and becomes more complex, so too does the pressure to perform. New research from international recruitment agency Robert Half Finance & Accounting shows today’s CFOs are worried about much more than just their organisation’s financial performance.
When Robert Half asked 2200 CFOs from organisations across the United States what keeps them awake at night, 25 per cent said they were most deeply concerned about conflicts with co-workers or superiors, while 25 per cent were worried about their own job performance. Another 22 per cent said finding and hiring talented people was their biggest challenge.
So why have people, relationships and performance become such a concern for CFOs — and what can they do to get a better night’s rest?
According to David Jones, managing director at Robert Half in Sydney, the results reflect the broader role CFOs are increasingly called upon to play.
The CFO role is expanding
“Finance teams are under significant pressure to add value and take on more of a business partnering role within the organisation. Yet at the same time, many finance departments are facing a leaner supply of resources,” he says.
This pressure is set to intensify.
“The demands put on CFOs and finance professionals will only continue to increase. They will not only be expected to broaden their roles but also to have a higher involvement in stakeholder engagement as well as proactively identify and manage new commercial opportunities.”
As a result, CFOsneed to be skilled in much more than financial management. Communication skills, together with a well-developed business acumen and strategic vision, have become must-have skills for any finance professional ambitious to progress in their career.
CFOs need EQ as well as IQ
George Kapitelli FCPA is executive director for finance and logistics at the Royal Melbourne Hospital and North-Western Mental Health.
A finance veteran with 30 years’ experience, he joined the health industry in 2014 after CFO roles with General Motors Holden in Australia and Shanghai General Motors in Liuzhou, southern China.
Kapitelli says today’s CFOs need emotional intelligence (known as EQ) as well as IQ, so that they can negotiate different points of view within the leadership group.
He also says that while a clash of opinions is sometimes inevitable in a cross-functional team, this diversity can lead to better outcomes if managed properly.
“You always have competing priorities. As a finance person, my main priority has always been making sure you have a sustainable, successful organisation from a finance perspective – and that can be very different from the sales director, the engineering director or the head of research, for example, because their priorities are different,” he says.
Kapitelli says the task involves understanding all the points of view and communicating the key requirements of where the organisation is heading, getting alignment on that and moving forward. “That’s what a CFO needs to succeed at.”
How to collaborate effectively
CFOs need the emotional flexibility to collaborate effectively without letting egos intrude.
“Everyone likes to have their own way, but it’s important to put yourself in other people’s shoes, understand where they’re coming from, and work together to agree on the right path forward,” Kapitelli says.
“What’s really important is transparency and trust – giving people accurate financial insights into where the business is heading – then you’re relying on the emotional intelligence of the group to be able to take that information and use it appropriately.”
As for the one-in-four CFOs worried about their own performance, Kapitelli sees a certain amount of worry as both healthy and desirable.
“Complacency leads to failure,” he cautions. “You’ve always got to be monitoring performance, making sure you’re hitting your targets – and when issues arise, you’ve got to deal with them quickly.”
It’s also important to accept and act on criticism.
“Remember not to discount or respond inappropriately to negative feedback, as this is generally valuable information and can have the most positive impact on your performance,” he says.
How CFOs are responding to their changing role
What should CFOs and aspiring CFOs be doing to meet the demands of their changing role, without too many sleepless nights?
According to Jones, CFOs need to ensure they have the strategic and technical skills to act as agents of change, helping their organisations navigate a business environment transformed by technological innovation.“As companies transform for the digital age, CFOs are not only responsible for digital investments, they also need to leverage the full potential of these investments to improve efficiency, optimise resources and hone strategic insights,” he says.
“That makes them perfectly placed to lead change throughout the business.”
According to Kapitelli, it’s essential to consult widely and never stop learning.
“A CFO needs to continuously strive to improve their knowledge,” he says. “For me, changing industries was a real plus. It forced me to learn again.”
3 tips for aspiring CFOs
According to George Kapitelli, three things make a CFO great:
- A positive attitude, even when the going is tough
- Transparency and trust, ensuring support and alignment across the team
- Collaboration. Remember that you can’t do it all by yourself. The success of your team and your organisation reflects most positively on your performance as a CFO.