The CFO and CEO’s roles have an important relationship. On this episode of the GrowCFO Show Kevin Appleby looks closer at this relationship with Richard Medcalf, founder of Xquadrant . Richard is a mentor to CEOs and tells you how the CFO should work with the CEO and also how to make the jump from the CFO role to the CEO one.
About Richard Medcalf
Richard studied at the University of Oxford and is now a leadership strategist to top tech CEOs. He is the founder and CEO of Xquadrant.
Imposter syndrome and the CFO and CEO relationship
Imposter syndrome is where you may feel out of place in your new role, or as though you don’t know how you have ended up with it. Richard explains how this shows that you are developing and learning.
CFOs and CEOs are both senior positions meaning that you will be playing a bigger game. You will constantly be experimenting as to what will work best for you.
Richard importantly states that “there is no learning in the comfort zone, and no comfort in the learning zone”.
The ways the CFO and CEO should work together
Richard expands on how the CFO should be the CEO’s right hand. He describes how the CFO should make the CEO’s case for change by using the numbers to back it up but then give a further insight to the executive and the board as to what the numbers mean.
CEOs look forward for goals that will improve the business. This means, a CFO cannot be completely focused on the last quarter, but also what should happen in the next.
The CFO’s and CEO’s need for time balance
CFOs and CEOs both need a high level of skill in time management. Richard covers how you need not only to be focused on projects and execute them to a high level, but also to have time for strategic activity.
If you do not time manage and are not involved, it can hinder your progression in that role. Reliability to answer questions about your section of the business is important and this means you have to have time balance so you can have that availability.
The jump from CFO to CEO
Richard and Kevin discuss ways to make this jump;
One is to make sure you are doing more than what is required of an average CFO. This includes taking a larger interest in all the sections of the business as this is a key role of the CEO.
Secondly, you have to be big on vision. The CEO looks forward and looks at what the company wants to be. The CFO often looks at what has previously happened, so there has to be a balance of looking forward but also seeing what has worked in the past.
Lastly, you need to be ready to leave numbers behind. It is a new role,so don’t try and be a better CFO than yours. You will be expected to be well-rounded and have expertise in all areas, not only finance.
How can a CFO build business relevance:
Richard discusses this in two parts;
He looks into why you shouldn’t look to wow with your finance skills, show your business skills. You need to add perspectives and not only see the business from a finance point of view. Also look commercially at what risks would be beneficial to take.
Richard then delves into why you should not only have a financial plan but also a plan for finance. This will help you to uplevel your finance function which, if you can’t do, you won’t be able to do for the rest of the business.
Richard’s website has many complementary features to GrowCFO’s lessons. It includes things such as the kryptonite test which will highlight your teams’ weaknesses and areas that need management. The CFO can also utilise this as it can see what impact finance wants to make on the business.
You can also find an executive productivity assessment. This will show your benchmark and how you are doing. It will also help with time balance as you can see the least prioritised areas for work.
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