The role of the CFO is changing. The CFO of the future needs to step away from their comfort zone of the balance sheet and income statement to deliver non-traditional services to their company’s owners and board members. Want to become one? Focus on three specific areas:
Project the future state. Show what the business will look like in twenty-four to thirty-six months if the market and current strategies remain the same. Spark some high-level strategy discussions based on what you uncover. Then define a new path that paints a better picture. This kind of forward-thinking is what moves the CFO position into a proactive strategic planning role. Add value by envisioning future scenarios that lead to greater success.
Define and measure KPIs. More and more, top-notch CFOs will need to take off their Accounting hat on a regular basis. Each business has its own metrics that dictate success, and the CFO of the future must intimately understand the non-financial drivers of the business. These Key Performance Indicators (KPIs) need to be defined and tracked – what gets measured gets done – alongside key financial measures of success.
Get creative with compensation. The CFO of the future will need to work alongside their HR counterparts in providing novel thinking for employee compensation and incentive programs. No longer does organization size and inaccurate market salary survey data rule the day. A top notch CFO will contribute their analytical skills toward designing compensation programs that determine ROI for each employee. With that as a starting point, they can go on to create bonus programs that factor in individual teamwork as well as contribution to customer satisfaction.
All of this adds up to expanded responsibilities for the CFO of the future. That requires a quality Controller and strong members of Internal Audit, Tax, etc. In other words, everyone in the Finance Department will need to up their game. And it’s worth it, because together, you will create the company of the future.