Why organisations need a modern Finance Director
December 19th 2022 | Posted by Laurence Underwood
The role of a Finance Director has undergone significant changes in recent years, particularly due to the increased flexibility businesses have needed in response to the challenges of COVID-19.
Gone are the days when a Finance Director was simply a quiet accountant. Now, top finance professionals must be strategically minded individuals with strong communication and leadership skills.
The value of soft skills for modern Finance Directors
Traditionally, finance has been viewed as a numbers-driven function. However, modern finance directors are expected to possess strong soft skills in addition to technical knowledge. These skills allow them to effectively communicate with external and internal stakeholders, from the board of directors to small suppliers. They are also more attuned to the needs and preferences of customers, which helps them drive business growth and determine strategic direction. In addition, Finance Directors are adept at identifying and managing financial and commercial risk.
Effective communication is crucial for Finance Directors, as they often act as the public face of the business. They must be able to clearly convey financial information and advice to the CEO and other decision-makers, as well as to external parties such as investors and analysts. Strong soft skills also enable Finance Directors to build and maintain productive relationships with key stakeholders.
Forecasting the future rather than reporting the past
One of the biggest shifts in the role of Finance Director is the transition from merely reporting on past performance to predicting and planning for the future. Today’s finance professionals are able to quickly and effectively pivot their strategy as needed, particularly in fast-changing, flexible organisations. For example, they can update and modify business plans in real time to navigate a more productive path if original predictions prove to be inaccurate.
In order to effectively forecast and plan for the future, Finance Directors must be able to analyse and interpret financial data, identify trends and patterns, and make informed projections. They must also be able to adapt to changing market conditions and adjust their strategy accordingly.
Creating a supportive financial environment
To succeed in this role, top-performing Finance Directors create a supportive environment that includes best practices, a strong accounting team, and high-quality management information. By having this financial infrastructure in place, businesses can reap the benefits of a modern Finance Director with the skills to lead them into the future.
This includes implementing systems and processes that streamline financial operations, improving data accuracy and reliability, and leveraging technology to enhance efficiency and decision-making. Finance Directors also play a key role in building and managing a talented accounting team, setting clear goals and expectations, and providing ongoing support and development.
In summary, the modern Finance Director is a strategic, forward-thinking leader with strong communication and management skills. By leveraging these skills and building a supportive financial environment, they are well-equipped to guide businesses towards long-term success.