Posted by Robert Half Finance & Accounting on Wednesday, June 4, 2014 - 00:00 | Follow me
After some time as a chief financial officer, you may start to wonder what's next. Even though you're in a C-suite job, you might aspire to a larger role in your organization — like CEO.
It’s not a transition many CFOs aspire to. Only 2 percent of CFOs polled in a Robert Half survey chose “becoming CEO or president of a company” as the role they felt comes closest to what they’d consider as a next career move.
But that doesn’t mean it doesn’t happen. While some of the technical and soft skills required for the CEO role can be quite different from those for a CFO, there is more common ground than many people think.
The most obvious overlapping skill is financial knowledge. Knowing details of the key profit centers of the business and working with Wall Street analysts on a regular basis are invaluable to someone moving to the CEO slot.
“As CFO, I had a broad view of the financial environment that provided unique insight to the business,” wrote Errol Olsen, the CEO of Absolute Software, on CFO.com.
“Coming into the CEO role, I knew which product lines were healthy and which were operating at a loss, where we were growing quickly and where we’d stalled or rarely succeeded, and the current and potential profitability behind each initiative. I also spent a great deal of time with financial analysts and shareholders, so I had a solid understanding of what the market expected from the company as well. Having all of that information as background and context has been a significant strategic advantage for me in my new role.”
Someone with a CFO’s background will have a deeper understanding of the financial ramifications of decision-making and be able to add a practical perspective to a strategic one. Though too much practicality can potentially be an impediment in a job that requires an overarching vision of where to take the business, properly balanced, it can be an important asset.
CFOs in the best position to become CEOs are those who have also made a point of learning as much as they can about how the business works from top to bottom. A CEO must take a bigger-picture view of the company than the financial executive typically does, constantly envisioning ways through sales or operations (or both) to push the firm forward.
“CEOs are involved across the entire organization, and [as a CFO] if you want to understand their perspective and ultimately own the role in the future, that’s where you need to be,” Olsen advises. “Pick up the phone, and travel to other offices. It will let you see eye to eye with the CEO and understand what’s driving his or her priority list.”
A people focus
A company’s people are paramount to a CEO. As trite as it may sound, people really are a firm’s most valuable asset. The CEO needs to fully appreciate how integral his or her best people are to the business’s growth plans. It’s critical to spend time with top performers, rewarding them, encouraging them and developing more people like them. This occupies far more of a CEO’s time than it does for even a CFO who is considered a great manager. CEOs must be good listeners if they’re to pick up on what makes people successful in their company and what motivates different types of people.
Expanding your interpersonal skills, shifting your focus from risk to innovation, and understanding the operational demands of your company can help you make the move from CFO to CEO. If you feel you have the charisma and the ability to see the big picture that’s necessary to do the job well, then the personal satisfaction, increased compensation and new professional challenges will likely make the transition worthwhile.