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January 27, 2024 | 3-minute read (517 words)
The role of a Chief Finance Officer (CFO) has evolved significantly in the last decade. Once seen as a strictly tactical position focusing on data and numbers, today’s modern CFO has a more significant opportunity to make meaningful contributions to the organization.
In the wake of the internal and external business challenges and the technological advancements in the last few years, more companies are recognizing the CFO’s foundation in tactical capabilities and organizational expertise.
Although CFOs and their teams continue to handle traditional finance functions, such as monthly and yearly closes, compliance, and reporting, their roles and responsibilities have expanded.
The finance head is no longer just an accounting and finance expert. Instead, they must ace multiple skills to provide strategic business advice to their C-suite peers. At the same time, they also aid in bringing the right people to the table to help make those decisions.
CFOs have the knowledge and skills to enable the finance team to engage in value-creation and strategic tasks. They set up necessary systems to ensure the finance team is less focused on crunching and reporting historical numbers. Instead, the department invests time in delivering more robust analytics, insights, and trend forecasts for informed decision-making.
Besides reporting the financial numbers, the CFO shares the story behind them. They walk company stakeholders through the data contained in financial statements and reports so that they understand the implications and next steps.
Modern CFOs play a significant role in shaping Environmental, Social, and Governance (ESG) programs. They align social and climate issues with the company’s strategic goals and direction.
The CFO ensures that the finance team is technologically adept and has access to the latest innovations and solutions. They commit time and resources toward exploring and testing new tools and applications.
CFOs are responsible for preparing the organization to cope with the rapid pace of change. They have a different mindset and devise strategically sound options for quick and easy pivots when needed. Further, they mobilize teams as change accelerates.
Initially, CFOs might have focused on communicating primarily with the company investors and shareholders. Today, they must constantly communicate with an organization’s constituents, sharing company messages and information with employees, customers, suppliers, and the community.
The role of CFO has emerged from focusing on financial numbers and compliance to business planning, value creation, and process changes. Additionally, being a strategic partner to the CEO and C-suit, the CFO plays a crucial role in influencing company strategy.
Consider hiring an external financial expert to develop your financial strategy and safeguard your small business’s financial future. Outsourced CFO solutions can help you gain access to a pool of experienced financial experts with a broad, big-picture perspective.
Want to know more about outsourcing CFO services? Early Growth’s FinOps services offer time with an experienced CFO to help you and your company make informed business decisions. Talk to an expert today.
Kanika is an enthusiastic content writer who craves to push the boundaries and explore uncharted territories. With her exceptional writing skills and in-depth knowledge of business-to-business dynamics, she creates compelling narratives that help businesses achieve tangible ROI. When not hunched over the keyboard, you can find her sweating it out in the gym, or indulging in a marathon of adorable movies with her young son.
Accounting
Finance
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