Chief Financial Officers (CFOs) traditionally take responsibility for high-level financial management, but some of the most successful executives have begun to find that adopting an entrepreneurial approach can generate substantial advantages. Taking cues from startup CFOs, who must encourage change and spearhead innovation, may enable executives to make a positive impact, even on businesses that have advanced beyond the startup phase.
Discover how executives can think like startup CFOs and learn why entrepreneurial thinking can be the key to success for businesses of all sizes:
When taking on a CFO role at a long-established company, executives often encounter static business models that may no longer generate optimal results. Rather than adhering to these established models, executives can look to borrow from the approach that startup CFOs often employ.
As CFO.com explains, since few startups have established business models, their executives must encourage flexibility as they develop the best approach for the company. Instead of avoiding changes to the norm, startup CFOs encourage disruption. They take internal analysis into account when making changes and monitor data to understand the impact of each measure. They may adopt successful measures on a permanent basis, but they rarely hesitate to eliminate those that have not generated the intended results.
Many experienced executives have a tendency to adopt strategies and procedures that have driven results in the past. Forward-thinking CFOs, however, understand that sticking with the same processes does not guarantee consistent results, especially in a changing market.
Startup CFOs tend to take this one step further, resisting a commitment to specific approaches and emphasizing outcomes instead. The most successful CFOs often keep end goals in mind while remaining open to a range of potential procedures. Some of the processes may not generate the intended results, but quick thinking and a drive to meet objectives may enable CFOs to keep the business moving in the right direction.
For startup CFOs, success is rarely guaranteed. Instead, these executives understand that they must experiment with new approaches, find winning formulas, and recover quickly from unanticipated results or outright failures. For these CFOs, overcoming adversity is less of a far-reaching goal and more of an item on the daily to-do list.
From this, CFOs can learn that mastering resilience is essential. Naturally, even established businesses are not immune to market changes, unexpected challenges, and roadblocks. Writing for Forbes, Amy Modglin emphasizes that maintaining professionalism, modeling strength, and demonstrating resilience is an important component of effective CFO leadership.
Hire the Right Employees
In startups, many CFOs serve as hiring managers and actively oversee employee recruiting, training, and performance. While taking on this type of role can add yet another hat for startup CFOs to wear, it also gives these executives more power to build the types of teams they know the company needs to get ahead of the competition.
Although established companies may already have fully staffed human resource departments, CFOs may still consider becoming involved in HR strategy. By doing so, they can ensure that the company recruits and retains the right kind of entrepreneurial thinkers and forward-thinking employees. As Inc. explains, CFOs may even want to prioritize hiring employees with startup experience or employees who operate their own small businesses on the side.
For some executives, taking on a C-suite role can lead to relative isolation. Some CFOs develop habits of putting their own interests first at the expense of building bridges and maintaining important connections to key figures.
They can learn from startup CFOs, many of whom become experts at brokering compromises and connecting opposing parties. As CFO.com explains, due to the passionate nature of many startup employees, executives quickly understand the value of taking a diplomatic approach to management. Naturally, isolated employees and executives are likely to encounter significant obstacles to meeting high-level goals. By prioritizing relationships, trust, and loyalty, startup CFOs can create cohesive teams and effective work environments.
Drive Companywide Value
No matter the industry, CFOs are typically responsible for overseeing finances and streamlining performance. While some executives may tackle these tasks from within a relatively narrow frame, startup CFOs understand that they can achieve greater success and generate greater value with a more comprehensive approach.
Startup CFOs have the ability to assess a company’s value from a unique perspective, as they can take a holistic view. Writing for Forbes, Deniz Caglar et. al explain that strategic CFOs can use their knowledge and perspective to help the business identify key issues and design results-driven initiatives to drive value throughout the company.
For some established CFOs, change can be a daunting proposition and successful businesses may discourage modifications to processes and strategies that have been proven to work.
In contrast, startup CFOs constantly incite change, as doing so can generate positive results and keep the business ahead of the competition. While driving constant change may not be possible for all CFOs, even established executives can learn from this ability. As Inc. explains, most CFOs could stand to benefit from identifying smaller changes, such as certain processes that have begun to slow progress or specific components of the value chain that need improvement. From those small changes, large-scale outcomes and benefits could result.
CFOs who hesitate to take on change may also decline to take many risks. In contrast, many startup employees thrive on risks and revel in the rewards.
While few CFOs are likely to benefit from constant risk-taking, many may find that opening up to the prospect of taking risks is an important step in a positive direction. Through graduate programs like the New England College – Master of Science in Accounting Online and a few years of experience, CFOs develop finely-tuned analytical skills. They can assess the potential results and rewards of a risk, encouraging their company to take only those risks that could enable the business to move confidently toward positive change.
By honing these startup-inspired skills and approaches, CFOs may be able to help their companies achieve more positive results than ever before. If you are interested in advancing your accounting career, thinking like a startup CFO can help you grow your leadership acumen and therefore your accounting career opportunities.
Adjusting your growth mindset is one step toward higher level positions in accounting firms or company departments. The next step is pursuing further education. Visit the School of Graduate and Professional Studies at New England College to learn how a master’s in accounting online can help you on your journey.