Most CFOs I know are quite modest about their own performance. But no matter how good we are, we all secretly want to be better. That’s just human nature. Perhaps we’re harder on ourselves than other line-of-business heads, as we’re constantly evaluating risk and performance with a critical eye, including our own. So when CFOs are bullish about their own performance—and consistently get the results that prove it—you can be sure it’s more than just pride in their work. But have you ever wondered what self-confessed high-performing finance leaders do differently from the rest of the pack?
Now you can stop wondering. A recent Oxford Economics research report sponsored by SAP has looked at just that. In a survey of 1,500 global CFOs and senior finance leaders, Oxford Economics found that successful finance leaders have mastered six common competencies that boost their business performance. These traits directly correlate with faster revenue and profit margin growth. And there’s nothing to stop you from doing the same. These six core competencies include:
- Regular collaboration with other business units
- A strong influence beyond the finance function
- Extreme effectiveness at core finance functions
- Strong skills at handling regulatory changes
- Ability to drive strategic growth and growth initiatives
- Use of automation to boost efficiency
According to the research, when finance leaders are proactive in these six areas, the payoffs are both tangible and significant—so much so that their companies are twice as likely to report market-share growth over the previous year. They have a tighter grip on costs. And they make the most of innovations in technology. In fact, the fastest-growing and most profitable companies are most likely to have an influential, collaborative finance function that helps drive strategic growth initiatives across their organization.
Depending on your own internal processes and structure, I’m guessing that you do a handful of these with varying degrees of consistency. I’m here to nudge you to embrace them all. But how do you go above and beyond? What if you could not only adopt these six competencies, but do each one of them better than you are now?
While improvements in IT can obviously help across all six of these disciplines, interestingly, the research found that there is one technology in particular that boosts all of them: advanced analytics. Once colleagues from operating units see the power of analysis, the proverbial light switches on about the value of the finance function. And this lets CFOs play a much more strategic and collaborative role in driving growth. Finance executives can work more closely with their internal customers, and yield greater influence beyond their own departments with more granular insights. They dramatically improve core processes and efficiency, better anticipate the impact of regulatory requirements, and move the business forward based on hard evidence and data. Think of advanced analytics as the magic ingredient that turbo-boosts your performance.
We are in a unique position. Technology has elevated and redefined the role of modern CFOs, and we have a golden opportunity to proactively shape the business—and our own performance within it—for the better. Innovation, technology, and the tools to sharpen performance are all at our fingertips, but only if we apply them.
A copy of the Oxford Economics Research, “How Finance Leadership Pays Off,” is available here.