Options are sometimes good – so many good people, which ones do I hire? And sometimes “options” is another word for uncertainty, aka chaos.
FEI Daily spoke with Beth Kurth, Panel Content Lead for the MIT Sloan CFO Summit and VP IR, LaVoieHealthScience about the theme of this year’s MIT Sloan CFO Summit: Balanced Chaos.
FEI Daily: Can you explain the meaning behind the conference theme “balancing chaos?” What are some examples of the chaos that CFOs are facing today?
Beth Kurth: Balanced chaos is curating on the fly – ensuring a state of equilibrium, while continuing forward progress. This means continually balancing ideas and options, while making real-time decisions that allow for onward motion. Successful leaders need to make decisions, convey those decisions with confidence, and manage with certainty.
CFOs need to inhale an extraordinary of inputs – including people, policies, possible products and potential go-to-market strategies; and exhale a coherent, meaningful business plan. Decisions which used to be limited to one or two options, such as accounting programs, now have 20+ from which to choose.
FEI Daily: How has the role of the CFO changed?
Kurth: The role of an individual CFO changes daily and annually; and collectively the role of the CFO continues to evolve as well.
On a daily basis, because they sit at the hub of financial decision-making, in the morning the CFO may be part of a strategy session working on the five- and ten-year growth plan – what are the macro-trends, how do we see our product evolving? And in the afternoon the CFO may be tasked with helping negotiate a complex sales agreement.
From year to year, as the company matures, the role of the CFO may evolve from fundraising to capital allocation; from a focus on implementing new systems to optimizing the ones on hand.
Collectively, the role of the CFO continues to expand as the individual roles evolve and the individuals themselves move from one company to the another. Thus a CFO who participates in strategic decision-making not only carries that skill to the next role, but also sets the expectation for the incoming CFO to assume that function.
FEI Daily: How has cyber security had an impact on the role?
Kurth: CFOs are inextricably linked to cyber security because CFOs are the hub of financial decision-making, and software systems are the hub of company operations. There is also an underlying connection that evolved as follows: Back in the early days of technology, CFOs traditionally had the most software expertise because accounting programs were one of the first to permeate the business world. As new technology became available (ex: database management or CRM), the CFO would often be part of the buying decision in part because of their software “expertise,” and in part because new software entails a budgeting decision. With software now an integral part of all companies’ operations, cyber security – ensuring the integrity of those systems – is mission critical. Just as CFOs weigh options around all other business inputs, so too must they weigh options around cyber security. How often to run a security screen? Who to use and how? Off prem or on? Fortunately, CFOs are well-versed in decision-making and therefore well-suited to be part of the cyber security conversation.
FEI Daily: What are your thoughts on the value of a CPA or accounting background for a CFO?
Kurth: Professional certifications are always of value because it shows the person has achieved competency and commitment in the given field. A CPA indicates knowledge of the ins and outs of accounting rules, and is certainly helpful as businesses have become more complicated. That said, the role of the CFO today is much broader than accounting alone therefore hands-on business expertise is also highly valued.•