If you're an accounting or finance professional with your eye on the C-suite, specifically the job of chief financial officer, you should take a moment to make sure you're following the CFO career path.
That's the path that will take you to the top job of leading a company's financial operations and overall development, with responsibilities that can range from identifying growth targets to preparing the organisation for a sale or even salvaging an underperforming business.
It's a role that can be stressful, as this survey of tired CFOs shows, but also rewarding, as this post describes: CFO Salaries: Just One Reason to Aspire to the Top Job. If you want to read more about the CFO's role in startups and rapidly growing companies, download the research report released by the Financial Executives Research Foundation (FERF), sponsored by Robert Half and Protiviti.
Ready to jump in? Here are seven steps on the CFO career path to acquire just the right skills and experience:
1. Gain broad financial experience
To be the CFO, you'll need a firm grasp of the fundamentals of budgeting, analysis, compliance, risk management and other accounting principals.
As a CFO, your job will be to ensure that the CEO and board's decisions are financially sound, both in regard to resources available and regulatory compliance. Having solid financial experience makes you more apt to make these judgments. Sometimes, especially at small companies, the same person serves as chief executive officer and chief financial officer, making this financial expertise even more crucial.
2. Expand your business and operational experience
Gaining a deep understanding of the business is critical on the CFO career path. As a CFO, you'll regularly meet with the board and collaborate with managers. For this reason, you need a broader understanding of the business and operational sides of a company.
The insight and support of an experienced mentor can be effective at this stage, as can cross training and job shadowing. Taking a leadership position at a nonprofit or industry association also can offer valuable training for future CFOs by providing exposure to a broad range of business processes and challenges.
3. Widen your customer service experience
Be sure to develop relationships with people at all levels of the company, both within and outside your department. Improve your communication and presentation skills. Position yourself as a team builder.
Not only as CFO will you be responsible to the board regarding the financial status of a company, but you'll also speak with investors. You'll serve as a conduit between what they want to see from the company and the board. These corporate communications will be frequent, as investors are key stakeholders of the business.
4. Broaden your understanding of technology
With more number-crunching in the cloud, Software as a Service, big data analysis, cybersecurity and other innovations permeating the finance industry, part of the CFO career path is understanding the benefits and risks associated with technology.
More companies are finding that they need to build technical competence from within their finance and accounting departments. While you may not become an expert in this realm, it wouldn't hurt to familiarize yourself with data retrieval, interpretation and analysis.
5. Earn a CPA or MBA
Although CFOs come from various backgrounds, certain certifications and advanced degrees tend to make transitioning into the position easier. Chartered Professional Accountant of Canada (CPA) licenses are often the most suited for the role given their wide-reaching skills they represent, including forensic accounting and compliance knowledge. A masters in business administration is often useful in conjunction with the CPA. Earning an MBA can help you increase your business and operational understanding.
6. Consider controller and treasury positions
Like designations, certain job titles have been held previously by today's CFOs. Some have held positions of increasing responsibility within an accounting department, such as internal audit manager, director of finance or controller. Getting broad corporate experience in a treasury function, as an example, can increase your experience with funding and strategy execution, both of which are essential for CFO duties.
7. Prepare to take on expanded roles
The influence of CFOs within their organisations continues to expand. At many companies, the roles have expanded outside of traditional accounting and finance, to human resources and information technology.
Leading a business is also getting harder, recent research has shown. In a Robert Half survey, 87 per cent of CFOs said it is more challenging to be a company leader today than it was five years ago.
Between new roles and continuing education, it may take some time to get there, but many who have taken the CFO career path find it's worth the journey in the end. Start now to position yourself for success.