Besides all the accounting skills they learned in school, tomorrow’s CFO will need to have sharp business acumen.
As Workday finance writer Steve Dunne observes, “Once considered a numbers-only role, finance is now balancing traditional responsibilities with the growing demand for data-driven analysis and insights, risk management and other key business functions.”
The shift from number cruncher to analyst and strategist is nowhere more clearly seen than in the percentage of chief financial officers at America’s largest companies that are CPAs. Where half were certified public accountants in 2014, last year only 36% held that certification.
“It’s almost ideal now to have a businessperson who happens to have a strong finance background,” says Barry Toren, a financial officers practice leader. “They need to have a nimbleness and an ability to deal with ambiguity.”
In a global survey by the Association of Chartered Certified Accountants and the Institute of Management Accountants, a majority of the management accountants said the role of CFO had already evolved to give them “leading responsibility for business strategy formulation.”
After marshaling the evidence to show how the role of the CFO is changing, Dunne details five skills “that finance needs in order to become the strategic guide the C-suite requires”:
Diversification — Pointing out that “data and actionable insights are now fundamental to business success,” Dunne says CEOs want their finance leaders to have both accounting skills and “wider operational backgrounds and a broader mix of business experience.”
Data science familiarity – “CFOs and finance teams will need to understand how to harness data — beyond the numbers — to explain why strategies are the right ones, and to explain the reasons and context behind those decisions.”
Technology understanding – “Finance teams will increasingly use advanced analytics to run predictive models and develop better forecasts. Understanding technology and systems — and whether they are capable of enabling greater efficiencies, agility, and insights — will be critical.”
Better collaboration with CIOs – “Finance’s journey to become a more strategic function will depend a great deal on its ability to find the skills to allow it to embrace digital technologies, such as artificial intelligence and machine learning. That requires a shift to more technical skills and better links with IT leaders to bring together the two functions more effectively.”
Ethics and trust – “The ability to apply an ethical lens is a strong attribute of the CFO, and the finance community,” writes Dunne.
Calling the past year “socially, politically, and economically transformational,” Dunne says the challenges have also made it an “opportune time for the office of finance to have an impact, with CEOs increasingly looking to the finance function to help shape business direction and strategy.”