Do You Have What It Takes To Be CFO?

You may think you’re ready to take the leap into the C-suite and pursue a chief financial officer (CFO) position, but there are many factors to consider when transitioning from controller to CFO. For many finance professionals, the controller role serves as a steppingstone to becoming a CFO. It provides invaluable experience in financial management and reporting, which are fundamental to the CFO position. However, a CFO carries different responsibilities and must possess specific qualities that significantly differ from those of a controller.

Controllers are often the unsung heroes of finance departments. They’re the experts who manage transactions, oversee accounts payable and ensure the company’s financial records are accurate and compliant. Many controllers come from public accounting, often after proving themselves as high achievers at prestigious firms, including the Big Four. Yet, the controller’s role is not limited to crunching numbers; they also manage hourly employees, which can be quite different from the world of audits and financial statements.

On the other hand, CFOs are responsible for managing not only hourly employees but also professionals. They play a crucial role in allocating the company’s resources efficiently and strategically. While controllers are deeply involved in the annual financial audit and maintaining financial schedules, these tasks typically fall outside the CFO domain.

Adding It Up: The CFO’s Core Responsibilities

To compete for a CFO position, a candidate usually must have expert-level experience in most of the following:

• Accounting

• Audits and compliance

• Leading financial planning and analysis

• Raising capital

• Private equity

• Debt financing and treasury management

• Handling multi-state and possibly international financial operations

• Cryptocurrencies

• Taxation

• Dealing with a board of directors

• Mergers and acquisitions

• Strategy

• Risk management, including cybersecurity insurance

The CFO’s responsibilities often expand into other areas like real estate and facility lease negotiation, equipment procurement and leases, legal issues and human resources, including compensation and retirement plans. A CFO, or someone who wants to be CFO, must be willing to raise their hand and take on these additional responsibilities. This may mean working closely with operating teams, developing departmental budgets, engaging in annual planning and being proactive in areas like tax planning.

The CFO: Beyond The Numbers

Being a CFO is more than just checking financial and business skills boxes on a résumé. There are many more interpersonal, nuanced qualities that a CFO must possess to be successful and effective:

Data Analysis

In today’s data-driven world, both controllers and CFOs must have strong data analytics skills. Controllers looking to become CFOs must be able to analyze data from various sources to inform financial decisions and strategies. This skill set is valuable for understanding trends, uncovering insights and making informed recommendations.

Communications

A successful CFO must be an excellent communicator and presenter. They are required to convey complex financial information effectively to boards, investors and other stakeholders.

Networking

Building and maintaining a robust professional network is crucial for many reasons, including having a go-to group of experts in areas such as tax, HR, accounting and enterprise risk management. A CFO candidate should stay in touch with classmates and industry peers and join CFO groups. This network can provide both opportunities and support when needed.

Delegation

Controllers are often prone to, well, controlling. A CFO must be comfortable managing multiple projects but not doing all the hands-on work themself. CFOs provide leadership. Controllers looking to become CFOs should delegate work to show they can use resources appropriately. Delegation also supports succession planning with employees who can potentially take over the controller or CFO roles, allowing for smooth transitions when necessary.

Leadership

CFOs are strategic thinkers, leaders and mentors. They handle stress well, work on multiple projects at the same time and understand change management.

Controlling Your CFO Career

As the saying goes, “No one manages your career better than you.” Sometimes, you may need to leave your current company to find the growth opportunities you seek. Don’t be afraid to take that risk and gain additional experience elsewhere.

Moving from a controller to a CFO is a significant career progression that demands a shift in responsibilities, skills and mindset. By understanding the key differences and taking proactive steps to develop the necessary skills and network, you can prepare yourself for this exciting journey. Remember, the road to the CFO’s office is paved with experience, knowledge and a willingness to embrace new challenges.