f Financial Officer (CFO) Career Overview //

The CFO is the highest ranking financial executive in a company or organization. CFOs are responsible for overseeing financial planning and implementing and enforcing financial policies and practices. They also report to other executives on organizational financial activities.

The CFO is distinguished from other finance professionals by his or her education and experience. CFOs are responsible for directing the financial direction of an organization or company. They have to be familiar with accounting, finance, and economics. Most likely, CFOs worked in finance at some point in their careers.

CFOs are the top executives. According to the Bureau of Labor Statistics, there will be an 8% increase of job growth among top executives between 2020-2030.

CFOs can work in all industries. According the BLS in 2020, chief executives were employed by private and public companies, enterprises, local governments, as well as computer and design companies.

This information will help you to understand the duties and skills required to become a CFO.

CFO Duties

The organization’s financial activities are managed by a CFO. The CFO oversees the financial and accounting staff of a company and tracks cash flow. They review financial data and identify strengths and weaknesses, and implement short- and long term financial plans.

CFOs report on financial activities to both employees and regulators. CFOs also have the following duties:

Expertise in CFO Areas

There are many subsets of CFO responsibilities. CFOs can work in corporations or assume roles in government agencies. CFOs can also delegate tasks and concentrate on financial oversight and leadership.

Personal CFO

Contrary to a corporate CFO, a personal CFO provides planning guidance for companies of any size. The personal CFO is responsible for accounting activities within the business. They work closely alongside the accounting team and focus on the specifics of a company’s financial needs.

A personal CFO can help entrepreneurs launch a business, manage investment projects, and offer advice on saving and retirement. Personal CFOs can perform similar duties to an accountant or an operation CFO, who focuses on compliance and daily accounting activities.

Common Job Titles

• Personal CFO
• 
  Financial Analyst
  
• 
  Financial Planner
  
• Investment Advisor

Strategic CFO

Both strategic and operational CFOs can understand the financial functions of a company. To plan for the future, strategic CFOs examine financial practices and processes within a company. A CFO operational who examines the past and future to identify inefficiencies and eliminate them. The strategic CFO is able to identify ways to grow.

Strategic CFOs are able to understand economic trends and create financial models that can be used to chart future expansion. A strategic CFO will advocate for safe spending and investments, while an operational CFO can be crucial in the case of a merger or acquisition.

Common Job Titles

• Vice President, Finance
• Director of Financial Planning
• Finance Executive Director
• Chief Investment Officer
• Chief Financial Analyst

How to become a Chief Financial Officer

CFOs must have a minimum of a bachelor’s in finance, economics or another comparable field. Many companies prefer CFOs who have a master’s degree. Additional certifications in finance such as public accounting or financial plan can also be helpful.

Individuals who wish to be CFOs will benefit from their experience. A minimum of five years experience in finance and accounting is required before you can become a manager. Future CFOs will have experience in many business and financial departments. This makes them qualified leaders within the organization.

Salary and Career Outlook for CFO

Payscale reported that the average salary of a CFO was $140,455. The BLS data on top executives shows that this varies depending on the industry and company size. In May 2021 , the top-paying industries in which chief executives worked were management of businesses and enterprises as well as computer systems design and related service.

The location also plays a role in earning potential and job accessibility for CFOs. California’s top executives were employed by nearly 34,000 companies as of May 2021. The annual average salary was $231,000. While Illinois’ top executives earned more than $244,000 in mean annual wages, only 8,500 jobs were available in the state as of May 2021.

Career Spotlight: John Pokorney, CFO

What was your initial interest in finance?

Since I was a child, I was fascinated by the ability to analyze data to answer questions. As a sixth-grader or seventh grader, I used to look through football magazines and predict the NFL’s entire season based on information about the running backs and the size and strength of the defense line.

When I started thinking about my career, my father was a VP at an accounting firm in stainless-steel. My cousin was a financial analyst at Coca-Cola.

What education did it take to be able to pursue this career? What did you learn that prepared you for the current job?

Because the big picture was more appealing to me than the detail-oriented accounting classes, I decided to pursue a BA in Economics.

What type of job did your bachelor’s degree get you? What do you do after your MBA?

My first job after I finished my undergraduate degree was as a statistician with the Bureau of Labor Statistics. It wasn’t going be something that would keep me interested for long.

What type of job did your bachelor’s degree get you? What do you do after your MBA?

My first job after I finished my undergraduate degree was as a statistician with the Bureau of Labor Statistics. It wasn’t going be something that would keep me interested for long.

I was unable to get into a Coca-Cola interview for a position as a financial analyst because I did not have an MBA. I was determined to complete my MBA to be able to interview for jobs at the companies that would allow me to do the type of analysis I was interested in.

After receiving my MBA degree from Indiana University, it was a decision that I made to join Intel. I had interned at Intel the previous summer and found it very exciting. It was fast-paced, and everyone expected the best from their colleagues. The finance department had a partnership role with other departments, which made it a collaborative environment. I would attend staff meetings with engineers, operations managers, and marketing teams. I learned the importance of being part of a team, and why everyone needs to understand the business’s operations.

When was the last time you had the dream of becoming a CFO?

My career progression at Intel was from financial analyst to senior analyst to manager and finally controller. I was a part of a company that grew rapidly, and the decision-making process and management structures were more formalized.

These growing pains made me think about my father’s work. He rose from VP of accounting to CEO of the steel plant, where he managed to grow the company from just one U.S. facility to three U.S. and three South American facilities. It was a lot more appealing to be in a small business than being part of a multinational financial team of 3,000.

One of the Intel operations managers I worked with told me that he was one of several managers who had the opportunity to take an Intel business plan and make it his own.

This was the first time Intel allowed it. I took the chance and accepted the job. I was initially encouraged to become the operations manager, but as we began to work with VCs to raise funding, I eventually became the CFO.

Which career path led you to this job? What was the most important thing that you learned on your path to becoming a CFO

My family and my experience as a CFO at Intel were the most influential in my professional development. My family taught me how important everyone was. This was evident in my parents’ behavior, but I also witnessed it in my father’s efforts to bring the steel mill from the brink of collapse.

He was VP of Accounting, but the steel mill was in serious financial trouble and was about to close. He spoke to the board about his plans to turn it around and they promoted him to CEO. He was able change the company’s culture. There was tension between the union and management before he assumed the leadership role.

My dad moved the office of the management team from 20 miles away to the mill’s complex. Every day, my dad walked across the factory floor meeting people and getting to know their lives.

After a couple of weeks, he stopped all production and ordered everyone to work for two weeks cleaning up the mill. He answered the union employees when they asked him why. “There’s too much junk and scrap metal around.” It doesn’t feel safe for me to work in.

My lesson was to treat everyone equally and care about them. This will make them care more about their jobs, and help them do better. After these two years, the company saw significant profit.

Second, I learned how to interact with every business function while at Intel. The culture of accountability, business partnerships, and team building helped me become a team member and help them achieve their goals.

What is a typical work day like for you?

Today, I am the Chief Financial Officer of LeTip International Inc. which is the largest privately-owned professional networking organization. LeTip International Inc. has more than 200 chapters in the country, with thousands of members from small businesses and entrepreneurs from virtually all industries.

I live in Arizona but work with East Coast staff and members. I start my day by looking through my email for any questions that have come in the night or earlier. All the daily activities that I need to do can wait until I answer any questions from customers, vendors, and other employees. This will allow me to get my day started with the resources I need.

My day is dominated by communication with staff, from the CEO to the support or sales teams. LeTip is so complex that coordination is a crucial function of my job as CFO. All of the people who will be affected by my decisions, whether they are in operations or direction, will want to know that my goal is to improve the bottom line. I also consider how my decisions will affect their lives.

What are the most rewarding aspects working as a CFO What are the most difficult aspects of being a CFO?

It is the ability to be at the table and influence decisions that affect the company’s future. This is what I find the most rewarding. One example of my experience in a construction company was being able lead operational changes that allowed our team to remove barriers and led to a 25% increase our productivity.

Being a CFO is the most difficult part of my job. You are not the main decision-maker and therefore cannot influence the CEO or board of directors to make certain decisions.

My least favorite example is from my first role as CFO when we were ready for a second round in VC financing. We had secured strategic partners to finance 125% of the total round. However, the board refused to allow me to bring in another VC as the lead. This caused a delay in decision making and led us to the start of a recession in our industry. 2 of our strategic partners pulled out of the round. Another delay resulted in only 50% funding of the planned round.

What is your opinion of the most important skill that CFOs must have to succeed?

Communication and empathy are two of the most important skills in any C-level job. Modern CFO roles are one of coordination between functions. You must be able to communicate with both a software engineer and customer support rep in the morning. You’ll be leading your team data-driven accountants. This is essential to be able to tell the story that management needs to hear in order to make decisions.

However, if your listening is purely financial, it will not be able to comprehend the cultural issues of the company. Your advice and decisions will sound hollow.

What advice would your career advise students?

Always be a student. There won’t be a moment in your career when you don’t know enough. This position can be taken from any angle, but it is important to have an open mind and a tame ego.

Questions about the CFO Job Description

What is a chief financial officer?

The chief financial officer oversees the financial activities and operations of an organization or company. They create and implement financial plans, evaluate financial data, and provide reports on finances to investors and colleagues as required.

Which degree is the best for becoming a CFO

Accounting or finance is the best degree for becoming a CFO. Although a bachelor’s degree can be combined with significant experience to get a job in CFO, many companies prefer CFOs who have a master’s.

Who is more powerful, a CEO or a CFO?

A CFO is a lower ranking executive than a chief executive officer (CEO). The CEO is the highest ranking executive, while the chief operating officer (COO), and the CFO are the second or third slots depending on the company.

Is being a CFO difficult?

Although it is challenging to be a CFO, those who have the right education and experience can succeed. CFOs must be disciplined, proactive, dedicated, and have time-management skills.

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Author: Justin Young

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