Want to avoid getting fired or having to fire your CFO? While chemistry plays a huge role in the partnership of a CFO with a CEO and a Board of Directors, the core reasons that CFOs get fired come down to practical skills. Rarely does a CFO get fired solely because of personality.
As I like to tell my clients and students, there are no real schools to learn how to be a better manager. Sure, you can find topic specific professional development. But that type of eduction focuses primarily on enhancing technical skills.
No place is more lacking practical management skills than the CFO house. As a matter of fact, this executive type is the perfect example of my premise.
Here’s why: An up and coming Controller will be promoted or hired into a CFO role. But where did they learn how to manage? Or, how did they gain the skills to communicate or present? And, what about learning to partner with your CEO?
Here are the Top 5 reasons why CFOs REALLY get fired.
1. Poor Communication Skills
Want to fail as a CFO? The fastest way is to lack communication and presentation skills. A 21st Century CFO skill-set demands proficiency in communication. In fact, the stronger your communication skills, the more likelihood for success. This doesn’t mean you have to be a world-class speaker (that could help!) but you must be able to present to boards, vendors, bankers and investors. But it doesn’t stop there. You must really excel at communication with your team, both your supervisor and your subordinates.
2. Poor Delegation Skills
Did you know 35% of CFO’s report delegation as their top Time Management skill? What’s wrong with that statistic? That ONLY 35% of CFO’s felt delegation was their most important skill. That’s how you get fired as CFO. If you want to succeed, you must possess strong delegation and management skills. You have to be able to provide guidance and allow others to perform for you. But most financial individuals are CONTROL FREAKS. They don’t trust so they don’t give up control. But that is a fast way to get fired. You gain leverage by delegating and your capacity to perform increases exponentially. (Source of studies: http://www.accountingweb.com/topic/technology/delegation-use-technology-most-effective-time-management)
3. Lack of Technology Proficiency
Did you know that 37% of CFO’s reported taking greater advantage of tech tools as the #1 way to better manage their time more effectively? Again, 37% is low. If you don’t want to last long as a CFO, then not becoming an early adopter of technology will insure your path to being fired. In today’s 21st Century, ultra-fast moving world, a CFO must not only posses a general knowledge of enterprise level software, they must know how these tools ADD VALUE to their finance department and the company as a whole. The excelling CFO’s use technology to enhance their work, primarily through analytics. (Source of studies: http://www.accountingweb.com/topic/technology/delegation-use-technology-most-effective-time-management)
4. Too Technical
Since most CFOs rise up from the finance and accounting arenas, they come from a technical background. But today’s CFO duties demand being more broad, not just technical. That’s why I like to say many Controllers who were fantastic in that role make terrible CFOs. The job duties change but they don’t. That’s a fast ride to being fired.
5. Too Tactical
The other side of the technical coin for a CFO is a propensity for focusing on tactics, not strategies. Again, coming from the finance and accounting worlds, these technical wizards are focused on the proverbial TREES and have a difficult time seeing the FOREST. But becoming a successful 21st Century CFO requires you being more a strategist than technician.
Take these five reasons to heart, really look at your current skill-set and then chart a path to enhance any area you feel is weak. If you can’t perform your own honest assessment, find a business colleague who will tell you the truth.
Or, look at your most recent reviews or comments from your CEO or Board. Their feedback will leave clues on your weaknesses. Then, find professional development to gain these lacking skills. Your best defense is always a good offense.