By Jack Hagel
CFOs have seen their duties grow in recent years. Eighty-five percent of CPAs said the role of the CFO and the finance function has expanded moderately or significantly in their organization, according to a recent AICPA survey.
“We don’t just do numbers,” said Ralph Bender, CPA, CGMA, the CFO of Manship Media in Louisiana. “We do people. We do strategy. We’re looking at: What are the smart ways to grow the business? What are the opportunity costs that we miss if we don’t do something?”
CFOs say that by developing the right skills, finance professionals can drive their organizations to conquer the growing complexity and deliver growth.
Delegation and time management
The expanding duties of the finance function can lead to wading into unnecessary details so deeply that it can undermine the CFO’s effectiveness. That may be why 35% of more than 2,100 CFOs surveyed by finance and accounting outsourcing provider Robert Half Management Resources said delegating more responsibilities is the most effective method for managing their time at work.
Paul Vanek, CPA, CGMA, managing member of The Vanek Consultancy Group in Houston, said effective delegation begins with confidence in one’s staff. “It’s not just having good people,” he said. “It’s having trust in them, that when you give them something, they’re going to do it.”
Bernie Leone, CPA/CITP, CGMA, an accounting and consulting partner in New York and Morristown, N.J., for accounting firm WithumSmith+Brown, listed these other timesavers:
- Track your time. Tracking everything you do over a two-week period can help you evaluate how you manage your time. An analysis of all work performed can help uncover which activities had real value and which activities were less useful and should be reduced in the future.
- Understand the reason for meetings. Although meetings are important for sharing information, systems or processes can be made more efficient to convey that information. For instance, the length of a meeting to review the details of financial statements can be reduced if the financial statements are provided to the participants ahead of time. Then the meeting could be limited to a short overview and addressing questions.
- Stick to the subject matter. Setting an objective and a time frame for a meeting—and sticking to them—can keep meetings from getting out of control.
Communication is also a key skill for finance professionals as they take on more responsibilities.
“It’s important to be able to try to not speak over people’s heads,” said Marc Valentin, CPA, CGMA, vice president of finance for MISCOR Group, an Ohio-based industrial services and rail services manufacturer. “It’s speaking at the same level. You know, when in Rome, be a Roman. I try not to use all my technical jargon when I’m talking to other people. I try to break it down into laymen’s terms.”
Bob Gaby, CPA/CITP, CGMA, a founder and principal at California-based management and technology consulting firm Arxis Technology, said three skills are essential for finance professionals today:
- Communication. “Whether you’re working with someone that is transactionally oriented, someone that’s just part of the team in a company, or working with a C-level or a VP, you’ve got to be able to communicate at all levels,” he said.
- Domain expertise. “We can’t be all things to all people anymore,” he said. “… As finance professionals, we need to identify where we’re strong, where our domain expertise is, and really focus in that area.”
- Building relationships. “Business doesn’t come the way it did in the past, via direct marketing, advertisement, et cetera,” he said. “It’s really about building those relationships and nurturing those relationships and keeping a real good focus on the relationship over time.”
The AICPA survey showed that at least some finance professionals need skills that even extend beyond the planning, reporting, and analytical functions that their roles have evolved to require. In some cases, finance also is involved with driving performance.
More than one-third of respondents (34%) said driving performance will be an essential skill in finance roles in the next one to three years.
In interviews, CGMA designation holders said keys to driving performance include:
- Learning the business. “I work very closely with my COO and my project managers,” said Elizabeth Nilsen, CPA, CGMA, the CFO of FKP Architects in Houston. “And I’m constantly revising the kind of financial information that I’m tracking and that I’m presenting to them to answer the questions that they have about their world and about the projects that they’re working on. We have that responsibility.”
- Identifying the key drivers. To give employees incentives, Micro 100 Tool Corp. updated and expanded its measurable steps and corresponding standards for various business processes. “There’s a whole variety of things that affect how efficient the operator is on the floor,” said Mick Armstrong, CPA, CGMA, Micro 100’s CFO. “We have to give a way to generate feedback so that we have an opportunity to constantly maintain or improve our efficiency.”
- Examining opportunities for improvements. Valentin said automation will continue to play a role in manufacturing processes. Finance has a key role in managing these process changes. “I think it’s important for the finance people to get out on the floor to be able to understand how that process goes, because” it will help them make better decisions, he said.
For more, see “Why CFOs Must Avoid Being Overwhelmed by Details,” by Ken Tysiac, at tinyurl.com/q2sq3c9, “Technology and Delegation Keys to CFO Time Management,” by Ken Tysiac, at tinyurl.com/qj3dplv, and “Critical Skills Needed for Finance to Cut Through Complexity,” by Ken Tysiac and Jack Hagel, at tinyurl.com/npncgep.
Jack Hagel is the editorial director CGMA Magazine.
This article was originally published in the October 2014 issue of The Journal of Accountancy.