The influence of soft skills in the role of a finance director
Gone are the days when finance directors could rely on their qualifications and technical knowledge to become successful and respected in the business arena. Today’s FDs tend to have a far more commercial role within the business.
This means that they are expected to be heavily involved in strategy and influencing the direction of the business. With this in mind it’s easy to understand why soft skills have become so influential when determining the career success of an FD.
The vital need for soft skills highlighted in findings
Recent findings by the British Universities Finance Directors Group (BUFDG) highlighted just how essential soft skills are to the modern FD. As the BUFDG pointed out, there is often argument when it comes to justifying the cost of developing these skills. However, FDs who want to flourish in today’s business environment must be prepared to make the necessary investment of time and money in order to hone these skills and ensure that they are put to use in an expert manner.
Understanding the need for soft skills
Many traditional FDs centred their attention on the facts and figures that were needed to secure the growth of the business. Now, as the FD role extends away from that of a “numbers person”, there is a need to incorporate other essential skills into the role. There are many soft skills that are beneficial to FDs, including three of the most vital.
The fact is that a communication breakdown between finance professionals and senior executives can result in misunderstandings that can have a seriously adverse effect on the business. This is more apparent in a world where FDs are expected to be business strategists as well as finance experts.
As with any business professional, FDs need to understand the 7 Cs of communication, complete, concise, considerate, correct, courteous, concrete and clear.
Today, FDs are more responsible than ever for driving the strategic approach of the business. They need to understand how to utilise data insights to provide information that is of a high standard and use it to influence CEOs and members of the board.
In order to do this FDs need to develop the skill of influencing to a high degree. They need to be able to take what they know about the financial performance of the business and influence senior stakeholders to make decisions that are sound and in the best interests of the business going forward.
The role of the finance directors has traditionally involved more interaction with numbers than with people. However, since the role has become more rounded, this is no longer the case.
FDs must now have well-developed emotional intelligence in order to garner support and respect from those around them. This emotional intelligence also enables an FD to engender a sense of togetherness and high levels of motivation within the finance discipline. This is essential when it comes to providing accurate reports and forecasts to inform the strategic planning of the business.
There are several signs of emotional intelligence that an FD should display including empathy, acceptance of feedback, authenticity, understanding of how their thoughts affect their behaviour and recognition of mistakes.
There can be no doubt that soft skills have a compelling influence on the role of an FD in the modern business environment. This is why FDs must invest time and effort into developing and honing these skills.
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Date Posted: November 20th 2019
Posted By: Phil Scott