At some point in history a management guru must have written that the “best” candidates for leadership positions are those who are technically proficient in their roles. Or at least that is how many organizations make the decision about whom to promote. Why is it that a successful controller may not succeed as a CFO? The short answer: Technical competence alone is not enough to make the leap successfully into an executive position.
While implicitly organizations expect people to perform as leaders, most have a limited understanding of what leadership looks like, what constitutes the best use of their time and energy, what they need to do to develop the necessary skill sets. This is particularly true for technical experts in the finance and accounting world. These individuals may believe that becoming more expert at what they do qualifies them for leadership positions. However, what they really need to excel at are:
- Build a Credibility Base
Successful leadership boils down to one thing — the ability to shape the way others think and feel about how they take decisive and responsible action. This definition implies that a leader is someone who influences others successfully. Influence and credibility go hand-in-hand. When someone has credibility, others are more likely to trust them, believe them and be influenced.
To better understand how a controller builds credibility, first consider what technical expertise is required — knowledge and experience with basic accounting procedures and processes, compliance and reporting requirements, a basic understanding of the business and perhaps how to manage a team. Technical expertise and experience create a foundation for credibility. In order to make the leap into leadership positions, controllers need to execute and deliver results. Their reputation is based on the belief that what is of most value to the organization is not simply what they know, but how they use what they know to help others get what they need.
- Build and Manage Successful Relationships
What the most successful controllers understand is that there is a range of individuals with whom they must build relationships in order to maximize their performance. Depending on the size and type of organization, these relationships include one’s manager, staff, functional counterparts, bankers, insurance companies, accounting firms, lawyers, customers and suppliers. Working with so many constituents requires a conscious plan for developing networks and forging relationships with the right individuals. Routine interactions are not haphazard. You should know who the critical decision-makers and influencers are and spending time in discussing both tasks and on-going feedback about how to affect greater efficiencies and effectiveness. The benefit to controllers for building and managing relationships is that it helps to promote quicker turnaround time, more accurate reporting and timely decision making.
- Think and Act at a Strategic Business Level
It seems that since the beginning of the new millennium and particularly in the past two years, business acumen — the ability to think and act strategically — has played a greater role in an organization’s success, if not its survival. As a result, business acumen is something needed at all levels of the organization. In today’s world, finance and accounting professionals increasingly need to understand the big picture, to extrapolate from any one critical business situation to the broader, more dynamic and richer context of customers, competitors and business pressures. The ability to think and act at a strategic business level is rapidly becoming a critical differentiator that more organizations are using to select its business and finance leaders.
Making the Leap From Controller to CFO
A financial professional who aspires to a leadership or executive role must shift from technical competence to honing their management-relationship skills and business acumen. Effective influence skills become increasingly important in moving up in the organization. Understanding the business and looking at the marketplace, particularly the competition is more important than achieving greater task efficiency. Moving into leadership requires breadth, not depth, to make the leap.
Financial leaders think about who they need to influence in order to gain commitment and buy-in. They think “respect” and “impact,” how to persuade others to take decisive and responsible action. Nowhere is it written that every controller should aspire to become a CFO. In terms of career choices, they are at a fork in the road. Both paths require credibility, but the leadership role requires less hands-on technical work and more time spent in building and managing relationships and looking “out” at the world as well as inside the organization. One path is no better than the other. They represent two distinct and valid choices for career development.
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Dr. Alan Patterson is a 24-year veteran in change management, leadership development and executive coaching. He recently formed Mentoré, a consulting organization that focuses on aligning strategy, organization structure, job responsibilities and skill-sets to major shifts in the business. A published author, Patterson has been a consultant to Fortune 500 organizations and a featured speaker and presenter for the AICPA. You can reach him at 410-541-9133.