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By Pamela R. Murphy and Yolande E. Chan
How to navigate your way to the C-suite.
Many young accountants have their sights set on becoming a chief financial officer, but are not sure what skills to develop. This competency map is designed to help. The minimum competencies — the starting point of the competency map — are those necessary for passing professional accounting certification exams. The competency map provides information in two ways. First, it is an easy visual guide to when and how to develop each competency. Second, the map provides rich detail from executive respondents regarding how they built each competency.
The charts on the following pages assist professional accountants in developing the competencies necessary for becoming a CFO. The map was created from prior literature (Deloitte, 2007)* and a comprehensive survey of Ontario C-suite executives. It begins with a list of 34 competencies structured within four general roles of a CFO:
Accounting, control, risk management and asset preservation are the province of the steward. The steward must ensure company compliance with financial reporting and control requirements. Information quality and control rationalization are top-of-mind issues for the steward (eight competencies).
Efficiency and service levels are the primary areas of focus for the operator. The operator must dynamically balance cost and service levels in delivering on the finance organization's responsibilities and adapt finance's operating model as necessary. Talent management, offshoring and shared service decisions are often the key issues to be addressed. This role is oriented toward best practices of the finance function itself (nine competencies).
The catalyst is an agent of change, focused on establishing a value attitude throughout the organization. The catalyst gains business alignment to identify, evaluate and execute strategies and serves as a business partner to other decision-makers, including business unit leaders, the chief information officer and sales and marketing leaders. The catalyst establishes a structure of enterprise accountability for results, drives enterprise execution and gains acceptance from business management as the organization's catalyst. This role is oriented toward best practices of the entire organization (nine competencies).
The strategist is a director, focused on defining the future of the company to enhance business performance and shareholder value. The strategist provides a financial perspective on innovation and profitable growth; leverages this perspective to improve risk-awareness, strategic decision-making and performance management integration; and translates the expectations of the capital markets into internal business imperatives. This role is oriented toward long-term strategic issues and is outwardly directed (eight competencies).” - Source: Four faces of the CFO (Deloitte, 2007).
This provides a general visualization of when and how to develop each competency. For each competency, Part 1 indicates approximately when during a career the competency should be developed — early, middle or late. In addition, it prioritizes how to develop each competency — through education, experience or with the help of a mentor.
This provides more detail about each competency, along with specific ways to develop that competency.
Ontario C-suite executives agreed that though all four CFO roles are important, the steward role is most important. Of all 34 competencies, the executives agreed that personal integrity (within the catalyst role) is the single most important competency.
Looking forward five to 10 years, executives indicated that all four roles will remain important for a CFO, but more respondents indicated that the strategist role will rise in importance the most. For those interested in moving from a CFO to a CEO, the executives believed all four roles still apply to a CEO but with different weightings. The strategist role is most important for the CEO.
Pamela R. Murphy is associate professor and E. Marie Shantz fellow in accounting at Queen's University.
Yolande E. Chan is associate vice-principal (research) and E. Marie Shantz professor of MIS at Queen's University.
* The authors acknowledge the contributions of T. Anger, A. Barrett, Y. Luo, Y. Rahrovani, J. Roger, and J. Wylie. They are grateful to the executives who completed the survey and to The Monieson Centre of Queen's School of Business and the Chartered Professional Accountants of Ontario for their financial support.
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