Controllers who want to rise to chief financial officer need to move beyond finance expertise and become leaders with strong people skills, according to a new report.
The results of a Korn/Ferry International survey reveal that controllers seem to have an advantage when competing for the CFO position. As many as one-third (33 percent) of Fortune 500 CFOs had been promoted from a controller post. But, just four percent of external hires were controllers, while 58 percent originated from CFO posts elsewhere, and 17 percent came from a CEO or general manager position elsewhere.
In short, the majority of CFOs in Fortune 500 companies are not promoted from a controller post. To identify the cause, and to learn the differences between controllers and CFOs, Korn/Ferry evaluated 500,000 profiles of business executives worldwide. The final report describes the traits of a successful CFO and how controllers can rise to CFO.
The most significant finding is the gap in the leadership skills necessary for top CFO performance. Korn/Ferry found that because organizations tend to overlook the development of finance manager leadership skills, controllers may lack leadership skills. Thus, individuals need to take it upon themselves to put in the extra effort to develop these skills for a CFO promotion.
The research also clearly shows that CFO success is not the same as controller success. Korn/Ferry says CFOs are focused on "people" issues, traditional financial government responsibilities, and interpersonal relationships to help them make better decisions. By contrast, controllers are more task-focused and less inclined to build consensus.
Traits of a successful CFO:
- CFOs are participative leaders -- they are highly interactive, social and consensus-oriented, and with a more fluid leadership style.
- Controllers who want to rise to chief financial officer need to move beyond finance expertise and become leaders with strong people skills, according to a new report.
- CFOs are risk tolerant -- they tend to exhibit higher levels of ambiguity tolerance, empathy for others, and self-confidence.
Korn/Ferry's report concludes that to get ahead and jump to the C-suite, controllers need to make "people" and leadership skills a priority. Tips for controllers include the following:
- Evolve your leadership style.
- Learn from others.
- Become situationally aware.
- Focus on people.
- Improve creative thinking.
- Be aware of yourself.