Today's CFOs are strategic leaders who can think beyond budgeting and accounting. They deeply understand financial data, risk management, operations, and the broader business contexts at play. They collaborate with other senior executives on key decisions, all while managing and motivating a team of finance professionals.
Is your organization prepared to lose those skill sets? Many of today's CFOs are Baby Boomers, and they are leaving the workforce in droves now and in the near future. In fact, 38% of CFOs are concerned that their retirement will be detrimental to the organizations that employ them.
Businesses must take steps now to ensure that they have a pipeline of talent ready to step into the CFO role. It's time to start mentoring the next generation of leaders by identifying high-potential employees and investing in their development. The key question is: How do you mentor someone to be a successful CFO when the role is evolving?
Looking Toward the Future
In the past, technical knowledge, industry experience and strategic thinking were the primary job qualifications for CFOs. Most corporate finance decisions were made manually with the help of spreadsheets.
Now, with the digital transformation, big data and machine learning, many of these decisions — or at least the data collection that supports them — are automated. Within financial reporting, finance professionals now pull data from multiple systems and departments, requiring knowledge of technology systems, human resources, risk management, banking and treasury, and mergers and acquisitions.
In addition to technical knowledge, they need "soft skills" like being detail-oriented, organized and communicative. They must demonstrate strong analytical abilities and creative thinking. They also need to be proactive about anticipating problems and changes in the market and addressing them before they hurt the company's bottom line.
Mentoring Your Team
As Millennials and Gen Xers continue to climb the proverbial ladder in your organization – alongside Gen Z's entrance into the workforce – mentoring provides the structure for them to move up. With a widened pool of potential new leaders, your organization can ensure it is prepared for the loss of institutional knowledge resulting from Baby Boomer retirements.
Here are three strategies for creating those mentoring opportunities.
Provide Exposure to All Functions of the Company
Today, finance is embedded throughout the business, providing decision support to key functions, including human resources, strategy, operations, marketing and IT.
Giving up-and-coming leaders opportunities to gain a breadth of experience in different functional disciplines and areas beyond accounting and finance is essential. It helps them acquire a 360-degree view of the finance function, build their professional networks and develop a broader vision for their future roles as CFOs.
Help Them Understand the Organization
A future CFO needs a deep understanding of the organization to be effective. They need to understand the financials but also know:
- How the organization makes money
- Who its top competitors are, and how the company compares to them
- What its key drivers are — cash, profit, assets, people, etc. — and how they help the business sustain profitable growth
- Its strengths, weaknesses, opportunities and threats
A CFO who understands the organization can proactively provide data-driven insights that help the rest of the executive team make better decisions about where to allocate resources and how to grow the business.
Help Them Develop Relationships
CFOs must foster excellent relationships with people both within and outside the organization to stay informed about the latest changes in the organization, the industry, the economy, and the world.
Introduce your CFO hopefuls to other organizational leaders, key vendors, suppliers, bankers, investors and customers. Encourage them to join professional associations and peer networks, such as the AICPA, Risk Management Association, and Institute of Management Accountants. This kind of involvement helps young leaders foster peer relationships that are incredibly beneficial when evaluating new ideas or seeking advice.
Being a mentor and helping shape the next generation of finance professionals is a huge part of any leader's role. Your knowledge and experience are invaluable, so take the time to share your insights with those eager to learn. The future of finance — and your organization — depends on it.
Copyright © 2022, CBIZ, Inc. All rights reserved. Contents of this publication may not be reproduced without the express written consent of CBIZ. This publication is distributed with the understanding that CBIZ is not rendering legal, accounting or other professional advice. The reader is advised to contact a tax professional prior to taking any action based upon this information. CBIZ assumes no liability whatsoever in connection with the use of this information and assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect the information contained herein.
CBIZ MHM is the brand name for CBIZ MHM, LLC, a national professional services company providing tax, financial advisory and consulting services to individuals, tax-exempt organizations and a wide range of publicly-traded and privately-held companies. CBIZ MHM, LLC is a fully owned subsidiary of CBIZ, Inc. (NYSE: CBZ).