BUSINESS GUIDE
5 Habits of Top CFOs
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5 Habits of Top CFOs
Take this advice and watch your career take off
The days when the chief financial officer was mainly As a key spokesperson for the business, the CFO
responsible for internal controls and compliance are is just as responsible for managing expectations as the
long gone. While financial discipline remains critical, CEO, perhaps more so. Because confidence requires
today’s CFOs play key roles in developing strategy, trust, effective CFOs understand that to succeed, they
fostering innovation, and driving growth. must be completely transparent when discussing
financial results with board members, investors, and
As the role expands, CFOs face challenges their other stakeholders. They avoid the temptation to make
predecessors never encountered: labor shortages, social results seem better than they are, either by over-
and environmental concerns, increased regulation, and emphasizing positives or glossing over negatives.
global competition, to name just a few.
They also recognize the importance of promoting and
CFOs are also more visible, both internally and maintaining the highest ethical standards across the
externally, than they were in the past. The green visor organization, working with their controllers to insist
and insular persona of the bean counter stereotype on full compliance with government regulations and
doesn’t apply today — if it ever did. To be effective, accounting rules.
CFOs must be both personable and analytical. They
need to be excellent communicators who exude Adherence to high ethical standards is particularly
credibility and are confident discussing any aspect of critical because the finance chief’s purview is now much
the business, not just the financials. broader and often includes oversight of functions like
human resources and information technology. CFOs
This business guide discusses habits that top play a pivotal role in developing and implementing
CFOs cultivate to meet today’s high expectations corporate strategy, sales plans, even development of
and demands. new products. The most effective CFOs understand
1. Adhere to a code of ethics the importance of taking the long view and resist the
After the financial scandals and deep recession of the temptation to improve short-term financial results at the
2000s, corporate boards turned to CFOs for better expense of long-term growth initiatives.
insight into the financial health of the businesses they In short, the most effective CFOs provide a moral
oversaw. The turmoil brought on by the pandemic, compass for the business. And that gives them
and now recession worries, have once again put chief credibility for the next step.
financial officers in the spotlight, with stakeholders
looking for proof that companies have what it takes to
sustain growth.
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2. Build and maintain relationships inside and Today, directors expect the CFO to provide a rational
outside the company perspective on the state of the business and act as
First and foremost, the chief financial officer must a counterpoint to the unbridled optimism CEOs
have a solid working relationship with the CEO. Good often exhibit.
relationships with other C-suite executives and direct
reports are also important, of course. Without them, Effective CFOs create a direct, open
it’s difficult for CFOs to accomplish anything. The
most effective CFOs don’t limit their interactions to the line of communication with each board
people they work with most. Rather, they strive to build member and build relationships based
relationships at all levels within the organization and
across all departments because they realize a strong
on mutual trust. This is the only way to
internal network will give them insights into company establish and maintain the credibility
performance they can’t get from financial data alone.
needed to meet directors’ expectations.
Top CFOs extend this action to their teams.
Finally, the most effective CFOs also engage with
Dave Damond, CFO of national nonprofit March of customers, vendors, community leaders, and other
Dimes, actually embeds finance personnel in external stakeholders. No company is an island; each
different units. exists within a larger ecosystem. Building relationships
within this ecosystem helps ensure the business
“We try to integrate with the department itself,” Damond
succeeds — while also building the CFO’s visibility and
said. “So have a person who supports that department
providing career advancement opportunities.
and is part of that department every day, [participates
in] weekly meetings and everyday operations. So they 3. Spot and advocate for opportunities, not just
get to know that person as part of their team.” against risks
Controlling costs is always important, and chief financial
Each embedded person then reports back to Damond,
officers are ultimately responsible for the financial
and together they determine how finance can best
health of their organizations. CFOs see it as their job to
help those other functions. The long-time leader also
protect the company by preventing money from being
sees it as his role to build a finance department that’s
misspent, leading some to refer to their CFO derisively
customer-service-focused, meaning his team tries to
as the “CFNo.” Consistent negativity makes it difficult to
say “yes” to as many requests as possible. This helps
build positive working relationships.
reframe the finance team as a valued business partner
rather than a source of convoluted processes Top CFOs are just as focused on long-term growth
and roadblocks. as they are on financial controls, and they evaluate
opportunities based on potential revenue as well as
A chief financial officer must also build relationships
costs. When discussing a new initiative, they assess the
with board members and key stakeholders outside
possible benefits first and, if feasible, attempt to quantify
of the company. In the past, boards tended to rely on
the value with the goal of ultimately funding projects
the CEO as their primary source of information about
that will grow the company.
business performance. In the wake of the 2007–2008
financial crisis, however, board members demand That doesn’t mean they don’t point out risks. But
greater transparency and look to CFOs for insights into instead of defaulting to “no,” they propose ways to
financial performance. As discussed, that trend was offset or minimize downsides where possible. And if
accelerated by the pandemic and recession fears. they ultimately must object to a deal, smart CFOs use
data to support their positions. It’s not always possible
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to avoid heated discussions, but a logically sound
argument backed up by solid data can mitigate the Delegation Win/Win
effects of emotion and intuition that so often lead to Executives always need to strike a balance when
bad decisions. it comes to handing off tasks. Damond always
keeps an eye on big-picture KPIs, like cash flow,
4. Develop, nurture, and trust your team
and knows who to ask for additional context if
Great leaders surround themselves with great people.
something catches his eye.
Top CFOs look for team members with not only the right
skills and experience — they also prioritize intangible But he leaves the details to staff, and that pays off
qualities like passion and work ethic. And with the for him, his team, and the organization.
growing importance of data analytics, many CFOs seek
out candidates who display intellectual curiosity as an “I try to delegate almost everything down
essential characteristic. because I want an expert and someone who gets
up in the morning thinking about that specific
Given that demand for finance and accounting talent function,” Damond said.
always seems to outpace supply, it’s also critical to keep
good people. Chief financial officers who understand Trust makes for a desirable boss, aiding
the importance of engaging with all team members do retention and adding to good reputational buzz.
better at retaining talent and treat voluntary turnover as To succeed, realize that hiring people more
a negative indicator of performance. knowledgeable than you in certain areas is the
key to effective delegation.
The best CFOs emphasize transparency here, too. They
make sure staff understand corporate strategy and
provide as much information as feasible during periods
of disruption or uncertainty. New, sophisticated software, in particular, requires
a champion, because not everyone is excited about
They actively solicit input on departmental policies
learning a new way to do what they’ve done for years.
and decisions and ask for feedback on their own
Take the example of customer relationship management
performance. And while not every company can provide
(CRM) software. Every minute your salespeople spend
skills training, effective CFOs look for ways to help staff
learning a new CRM is a minute they aren’t interacting
members develop professionally.
with customers. But eventually, it pays off. Same for
5. Always be attuned to what’s next replacing spreadsheets. “I can quickly get a sense of
In the name of continuous improvement, top CFOs something by combing through several complex Excel
regularly poll colleagues and clients, whether formally sheets,” said no one ever. Adopting enterprise
or informally, about how the company can better resource planning (ERP) and other enterprise software
serve customers. They also pay attention to both the may be uncomfortable. It’s also crucial to growth.
competitive and political landscapes, preparing their Top CFOs know this and are champions for tech and
organizations to respond effectively to market threats or process investments.
pending legislation.
As a trusted adviser both to the chief executive officer
Top CFOs also stay up-to-date on the latest technology. and board of directors, today’s CFO must also stay
Once relegated to the IT department, technology involved in scenario planning and M&A activities. With
decisions increasingly fall under the CFO’s purview, stakeholders increasingly concerned about the social
especially in organizations that lack a chief information and environmental impact of companies they invest in,
officer. While blockchain, artificial intelligence, and edge for instance, CFOs must look for ways to monitor and
computing get much of the press coverage, finding improve performance in these areas.
ways to make better use of existing data is a higher
priority for most CFOs.
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How data shows the way that enhance traditional accounting roles. They also
That final habit is incredibly time-consuming without advocate for and adopt digital platforms, like those
smart use of data. In fact, business intelligence and ERP and CRM systems, which not only provide them
advanced analytics underpin many of the habits top with real-time business-wide data but also simplify and
CFOs exhibit. Though underutilized, organizational data optimize the operations from which data flows.
is an important asset that, when fully leveraged, can
“Long, linear paper presentations are designed to keep
be a source of competitive advantage. With the right
things opaque,” observed one CFO. “Digital sets the
data, the modern CFO is better equipped to perform
truth free.”
the kind of cost/benefit analyses required to make
smart investments, including acquisitions. It also helps For data to drive organizational improvement, CFOs
neutralize, or at least make visible, biases that may must make a habit of using it to improve processes and
impact both C-level and line-of-business outlooks. drive innovation — even if that means, again, causing
some discomfort among their peers. Data-driven
Good data lessens the risks of intuitive or emotion-
improvements often require fundamentally changing
based decisions.
how departments operate. To get there, CFOs need
Top CFOs make data and analytics a priority for to hire people with the right skills, provide operational
themselves and their teams. They prioritize new skill support, and adopt technology that can enable this
sets, from data science to designing analysis procedures data-driven vision.
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The bottom line
In an era where transformation and innovation are being Learn More
mandated from all corners, the CFO role has changed.
• How 3 CFOs Are Growing Their Careers
and Companies
One trait that sets top CFOs apart
What do finance chiefs from an eco-conscious
from their peers is a relentless focus apparel brand, a healthcare services provider,
on innovation. They are constantly and a high-growth startup focused on critical
energy infrastructure have in common? More
looking for ways to improve operational than you may expect. In this guide, these three
efficiency, increase workforce CFOs share insights into how they got where
they are and how they’ve stayed at the top of
productivity, forge lasting customer their games through some challenging times.
relationships, and accelerate growth.
• Got Goals? This Metrics Framework Gets
Developing habits that enable them to meet disruption You There
head-on requires a commitment to conversations with An objectives and key results — OKR —
customers and constant analysis of the organization’s framework breaks big, hairy company goals into
data, identifying the real challenges based on those concrete, achievable steps. It gives employees,
insights, formulating a plan, and investing in technology managers, and teams the tools and KPIs they
platforms that solve those challenges at scale. need to know they’re moving in the right
direction. In this guide, we lay out a roadmap to
Highly effective CFOs succeed not just because they OKR success that can move your culture from
embrace innovation, but because they use it to achieve top-down to employee empowerment.
the organization’s financial and business goals.
• Chief Financial Officer Defined: Role,
With the right data and technology platforms at their Responsibilities and Skills
disposal, top CFOs can navigate future risks with Big public companies may have defined the
foresight that few other C-suite members possess. CFO role, but the chief financial officer position
is becoming increasingly common in midsize
and even small firms. Let’s look at the role,
responsibilities, and skills finance chiefs need
to serve their companies well. Knowing how to
spot slow-moving products, find the underlying
cause, and address the problem is an important
skill when selling physical products.
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