The CFO is a vital member of the C-Suite and supports the leadership team by providing valuable insights, supporting decision making and challenging the board. As a valued member of the executive team, the CFO also acts as a leader to the wider business.
Here are ten ways in which the CFO provides internal leadership to their company:
Aligning with the strategy
The CFO is responsible for ensuring that the company’s financial activities are aligned with its overall strategy. This means making sure that the company is investing in the right areas and allocating resources in a way that supports the company’s goals.
They work closely with the CEO to develop and implement the company’s strategy. This includes setting financial goals and objectives, as well as developing plans to achieve them and ensuring that the financial performance is on track. The CFO also provides input on other aspects of the company’s strategy, such as product development and marketing initiatives.
The second way the CFO leads internally is by championing initiatives. Once the company’s strategy has been set, the CFO takes a lead role in ensuring that it is executed effectively. This includes working with other departments to develop budgets and timelines, tracking progress against targets, and providing regular updates to senior management.
The CFO can also champion initiatives internally, helping to get support for new projects or changes from other departments. This could involve anything from implementing new systems to restructuring existing business operations.
CFOs enable people and processes by providing the company with the necessary resources to execute its strategy. This might include setting up training programmes and communicating clear expectations of each team.
CFOs ensure that there is adequate financing available to each team, as well as putting in place systems and processes to support the execution of the strategy. The CFO also works closely with other departments to ensure that they have what they need to do their jobs effectively.
The CFO works alongside the CEO to create a company culture of self-leadership. This means that policies and procedures are designed to empower employees to make decisions and take actions without needing to wait for permission from above. The CFO also helps to foster a culture of innovation by encouraging risk-taking and experimentation.
Transactional to transformational
The CFO plays a key role in transitioning the company from being transactional (focused on short-term results) to being transformational (focused on long-term success). This involves setting goals that are both challenging and achievable, as well as developing strategies that align with the company’s vision.
Finally, one of the most important ways that the CFO leads a company is by bridging different departments and building firm-wide collaboration. This requires the CFO to see the big picture and understand how each department contributes to the overall success of the company. By working closely with other department heads, the CFO can ensure that everyone is working towards the same goals and that there is a clear path to success.
Setting the pace
The CFO is responsible for setting the pace of the company by creating realistic targets and deadlines. This involves quantifying regular milestones that need to be achieved throughout the duration of the strategic plan. CFOs should set the pace by communicating expectations and leading by example. This involves making realistic demands of people within the desired culture of your business, without causing unnecessary anxiety and resentment.
The CFO plays a key role in monitoring internal activities and ensuring that the company is working together efficiently to deliver the strategic plan. This involves capturing performance data from around the business, analysing the results and attending meetings with different teams. CFOs track progress against each of the company’s goals to identify any shortfalls and implement mitigating actions to address them in a timely manner.
The CFO communicates progress internally on a regular basis to the entire workforce. They typically do this alongside the CEO in a joined-up manner to create consistent communication and avoid any confusing messages. This ensures that everyone is aware of how the company is performing against each of its strategic priorities and where it is headed. It also allows for transparency and accountability within the company.
Delivering the business plan
The CFO is also responsible for identifying and addressing any issues that may arise during the implementation of the strategy. CFOs work closely alongside the CEO to check that each team has sufficient capital, whilst providing guidance and support so that they can deliver each task. By monitoring ongoing performance, CFOs are well-placed to detect any problems early and address them quickly. These combined activities allow CFOs to successfully deliver their company’s business plan.
The CFO is a critical C-Suite leader and plays a vital role in supporting the wider business. They are responsible for ensuring that the financial health of the company is strong, whilst supporting the CEO to document, monitor and deliver the business plan.
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