The Chief Financial Officer of any organization has many different responsibilities, such as internal financial control, financial reporting, assessment of the capital budgeting process, financing the organization, and other different responsibilities. Organizations are operating to raise the value of the share and it should not only consider the internal structure, its product, and competitor, but also the interaction and performance of the organization, and if any person in the organization has the combination of this thing then it might be possible that those get promoted to higher post in the organization.
The role of the CFO is evolving and that is why organizations are promoting their CFO to the position of CEO, but not all CFOs have the qualities to become a CEO. Nowadays CFOs are expected to interact with the higher authorities and board of directors and he has to take part in different activities such as strategic planning. Many CFOs cannot become successful, the reason is that many CFOs come from a pure accounting background and are not generally expected to make such a speedy rise up the corporate ladder.
Individuals who can gain a breadth of experience across several functions may stand a better chance of rising to CEO and will be more indispensable to the kind of ECO who seeks advice from their staff. CEO not only thinks about increasing the value of there company’s share but the look for different ways to generate more revenues, for example; Calloway the CEO of PepsiCo, after buying KFC he not only extended the menu of the restaurant but also make it available at lunch and dinner time.
He also focuses on the company on snack foods and restaurants and getting rid of several non-cores, low-profit businesses, such as North American Van Lines and Wilson Leach of Donaldson, Lufkin & Jenrette. Former CFOs who have been successful in making the transition to CEO have certain characteristics in common. they are strong, goal-oriented leaders who have a clear vision of the future, an external, marketplace-driven focus, and the willingness to take chances.
“CEOs are not made with cookie-cutters; it takes years of experience and a developed set of appropriate experiences to build to that position,” says Dick Gustafson, managing partner for health care practice at the Chicago-based executive search firm Heidrick & Struggles. An often effective first step for CFOs who wish to pursue careers as CEOs is to find ways to sharpen leadership skills in their organizations because, says Gustafson, “people are more willing to take a risk with someone they know than with someone they do not know. And they usually are more forgiving of the sins of commission than the sins of omission.”
If any person wants to become CEO in his or her future then he has to be immensely good in finance and operations because if a person is only good in finance then he can pursue his career in finance and nowadays in very few organizations financial manager’s job is only to do technical work and decisions making job is done by operations managers. In the future, if the CFO is not good in decision making, interpersonal communication, and goal oriented then there is very little chance for CFO to become CEO because CEOs are not good at decision making but also they efficiently perform finance-related jobs.
Reference
Janine Brewis (1999). How a CFO can graduate to CEO. Corporate Finance,(175), 13. Web.
Picker, Ida (1989). Do CFOs Really Make Good CEOs. Institutional Investor, 23(9), 47. Web.
Karen Sandrick, (1995). From CFO to CEO: what does it take to make the leap? HFM Resource Guide: Personal Finance. Web.