CFO Leadership: Building Finance Teams that Consistently Outperform

As the CFO role has steadily broadened and become more complex than all other C-suite roles, operating with 1-2 people down in 2023 feels like norm that likely won’t get fixed in 2024. Through the finance function lens, CFOs report that workload is heavy especially as the 2024 budgeting season ratchets up. With access to capital proving to be a higher hurdle than usual, budgets have tightened down finance hires until enterprise performance improvements indicate a more confident trajectory. And through a wider-angle lens, CFOs see leading economic indicators, trends in buyer sentiment, and changes in buying behavior challenging top line growth. Looking ahead to 2024, caution is the watchword driving another watchword – constraint.

A dimension fueling both watchwords is the sheer velocity of market change and the knock-on effect on business models and support resources right down to the individual human level. Finance teams will have to lead enterprises in pressure-testing budget assumptions more rigorously, analyzing and scenarioizing more now and throughout the upcoming fiscal year, establishing better early warning systems on performance, and pre-preparing pivot strategies capable of being implemented on fast tracks as needed. Net net, workloads are going to get even heavier in 2024.

Without the ability to soak up workload with new hires, better data and technologies can help. But they won’t fix things entirely.

So, Job 1 becomes being human and genuinely taking care of the team that you have. A CFO who has earned the respect and stature of leader beyond rank and title will enjoy team performance marked by extra effort and even sacrifice. The CFOs that apply purposeful focus on both individual staff members and at the team level to form a tightly-bonded, high-trust unit have a better chance of not only weathering the difficulty; they have a chance to outperform against the odds.

Begin with a Baseline Assessment of Your Team

CFOs value factual data, right? In the context of building and strengthening a Finance team capable of performing despite the challenges, the best data will come from a well-structured satisfaction and motivation survey. It’s best to know where you stand with your team and how the function feels about the enterprise so you specifically know what needs fixed and why. So, insist on hearing bad news, if any, immediately.

If HR is doing surveys routinely, you have a chance to overcome the barriers. That assumes that general surveys provide enough finance specifics to be actionable and that you take the actions recommended and back them with a process that assures you have solidly fixed the issues.

Beware of Smokescreens and Determine What’s Really Wrong

In analyzing hundreds of such surveys, the most frequently mentioned barrier categories to satisfaction and motivation are communications, career opportunities, workload, and culture. Sometimes the results are too ma y rungs up the abstraction ladder to get to root causes and be actionable. So, let’s look at what’s typically being said with each barrier and what finance team leaders can do even if CEOs, Presidents, or Owners don’t take ownership more systematically across the enterprise.

• When they point to “Communications” . . . what they are really saying is that they want:
  • to feel that the enterprise strategy is sound. They will be more engaged and supportive if CFOs establish a regular cadence of communications to explain business strategy, the factors underlying it, how it impacts their roles, and report-outs on business performance and outlooks.
  • personalized communications and a genuine relationship that guides personal and professional development.
• When they point to “Career opportunities” . . . what they are really saying is that they want:
  • to advance in responsibility and stature. Some will get there based on needs of the function that they are best suited to fill. For others, the business must scale up to create more advancement pathways. So, sustainable growth ends up being the biggest enabler of career advancement, and the extent to which each does the best job possible in achieving growth, they will be helping themselves. It’s tough love idea.
  • to know the criteria for selection/success. Spell out the performance criteria that will make a difference, and create a gap-closing action plan with each aspiring, eligible team member.
  • to see a fairer recognition of who is doing the work that is reflected in both compensation, recognition, and career advancement.
• When they point to “Workload” . . . what they are really saying is that they want:
  • a workplace conducive of personal well-being. Among the biggest of consequences of not enabling work-life balance are reduced motivation and productivity levels. Among the countermeasures, the most impactful in the post-COVID era is flexible working hours.
  • to do work that matters. Tasks that are highly repetitive and non-analytical cumulatively degrade a sense of importance especially in those who have a greater capacity for critical thinking, creativity, and building things.
  • to answer more what-if questions instead of what happened questions. Having the ability to contribute more strategically as in defining growth strategy and defining its enablers conveys a sense of worth and a better ability to affect outcomes.
• When they point to “Culture” . . . what they are really saying is that they want:
  • their business to win bigger and faster in the market to the point where they feel proud and confident in the company’s future
  • to be a brand rather than a business with a business name that their personal relationships and customers recognize and admire
  • that there is respect and civility among people and uniformity in processes that give a sense that the business and variables are under the control of good leadership
  • that everyone has a sense of what the end-point vision of success looks like and the plan to get there is believable and achievable.

Each of these main factors can be expanded with more core insights and nuances. The thing to understand most is the responsibility to manage human resources as a precious asset. That we succeed through others is a good way to think about what’s needed to build a team that will get things done the right way no matter what.

CFOs already have a driver-seat position for how they think, the scope of what they have to know and manage, and their span of influence in and outside of the enterprise. A CFO that exudes leadership and builds a team that shares this same sense of stature will be well served by it.

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