In the last year, businesses and clients have thrust CFOs and finance professionals into the spotlight. CFOs are leaned on more than ever to help businesses ‘survive and thrive’ in these extraordinary times.
From forecasts and scenarios to business model transformations and beyond, finance professionals scaled above and beyond the call of duty, outlining the impacts of government relief packages alongside the increasing complexity of tax compliance.
But not all finance specialists are playing on the same field or even the same game, according to Hemant Kumar, CFO of SOL-Millennium Medical, a global medical device company, and one of Sage’s Finance Futurists.
I sat down with Hemant—virtually of course—to talk about the impact of the pandemic on finance leaders, the future of finance, and how today’s professionals can be better prepared for times of uncertainty.
The impact of the pandemic on finance leaders
A recent article in the Wall Street Journal revealed that more finance chiefs resigned in 2020 than in any previous year. It’s a brow-raising statistic, citing the pandemic and subsequent increase in pressure on the finance and accounting function as a key contributing factor. Additionally, finance leaders felt the toll and rising pressure of accelerating trends in technology, demographics, and regulation.
Hemant describes the impact on finance using three buckets, with each bucket signifying a different type of leader that emerged in response to the pandemic.
Bucket one: Ahead of the game
In the first bucket, finance professionals act as a co-pilot to the CEO and senior management team. Increasingly in the past year, they’ve advised the company on various scenarios as well as new and emerging business models.
COVID-19 created the need for extra visibility into the business. With that came mounting uncertainty and volatile situations where companies were forced to make hard decisions at a moment’s notice, where as before they’d have more time to evaluate. Helping companies were these proactive, anticipatory finance leaders that led organizations through this pandemic.
Bucket two: Stepping up to the plate
The second bucket contains finance experts on the sidelines, waiting for business leaders to come to them before responding in a strategic way. They waited their turn to be called into the game, but once they got the call, they jumped in and added their voice to the conversation.
Bucket three: Playing catch-up
The third bucket holds the reactive individuals of the finance world. They’re so busy trying to keep up, they didn’t anticipate crucial business changes and just handed over the latest financial reports when asked.
Those in buckets two and three find themselves being replaced or leaving because of the stress of trying and failing to keep up. This resulted in a lack of relevance and loss of respect across the organization. Simply put, if you don’t have a seat at the strategy table, you might just be on the menu!
What skills does a CFO need today?
Hemant describes his finance function as a true ‘bucket one’ setup, with real-time reporting and a lot of data analytics. It has an ERP, eCommerce platform, and data analytics powered by Microsoft BI. He has his finance leaders embedded across the company geographic markets, working closely with the business unit leaders. But what are the core skills needed to be a truly impactful finance leader?
Professional development in finance
No matter what level your career is in, research from the Business Learning Institute on the T-Shaped Finance Professional will serve you well as you refine your skill set. Hemant points to the key competencies identified in the research. To be future-ready, finance leaders should focus on learning as much as possible.
For those in the early stages of their career, he advises: “Don’t think about titles, don’t think about money. Those are important, but making your foundation strong, creating networks which are going to help you in future is the investment one should make, and everything else will follow.”
How to become an all-star CFO: three tips for uncertain times
- Start with a deep understanding of your business. Understand how it serves customers, its supply chains, and how it makes money. Get to know your customer, and the business leaders you serve in finance. What are they looking for, what do they do with the reports you provide? What more could they do with those reports?
- Next, get your finger firmly on the industry’s pulse. Get an understanding of technology and where it is heading. Finance transformation means automation of technical accounting, freeing up time for more strategic and higher value work, and building your knowledge about the technology driving that transformation will reap rewards later down the line.
- Lastly, continue learning without limits. It’s all about education and focusing on the boundary-crossing skills at the top of the T-shaped Finance Professional chart. Today’s leaders must be constantly learning new skills to add value and increase their relevance in this constantly changing world.
Note: This post first appeared on the Sage Advice Blog on March 15, 2021