The transformation of the CFO’s role through the development of functions that are much more strategic than those performed in the past, implies, in return, responding to new needs, as well as incorporating those skills that facilitate the achievement of this objective
In this sense, it is interesting to explain this change in their functions, using a comparative model that is known as ‘Maslow's Pyramid’, where the different ‘needs’ of people are described, starting from the analysis of their most basic level to the most advanced, according to the development carried out by its creator, the American psychologist Abraham Maslow.
However, if a similarity is made with finance in general and with the functions of the CFO in particular, it is possible to establish different types of ‘parallels’ with Maslow’s model, in the sense of being able to describe the process of change in which it is immersed and the challenges, which in some cases are still pending to be achieved.
Thus, at a first level, we find the so-called ‘basic needs’, which are associated with the work of the CFO ‘of the past’, i.e the development of those ‘traditional’ operational tasks inherent to his function, such as the recording of transactions, bookkeeping, management of collections and payments or treasury control, among many others.
While these types of actions are necessary, hence their definition as basic, they only minimally comprise the potential value that the CFO can bring to the organisation.
When referring to the next level, related to ‘security needs’, more diverse issues come into play, such as the definition of the processes that allow the development of the functions indicated above, under adequate risk management, as well as the control of business management.
At the same time, we must include in this segment the definition by the CFO of the necessary technology to be incorporated, not only with regard to the organisation, ensuring the correct reflection of transactions and allowing the most appropriate control mechanisms to be established.
The third level of Maslow's Pyramid, called "social needs," implies, no more and no less, the relationship that the CFO must establish with the other business areas of the company, a critical aspect of their functions, which in many cases, will require them to make changes to their current position, with the objective of achieving a "cross-functional management" with the rest of their peers.
It is here where the function of the Director of Finance starts to carry a greater value, beyond their traditional role, in the sense of being able to exercise leadership through the business knowledge he possesses, which allows him to ´translate and communicate in numbers’, the company’s strategy, and likewise, to advance to the ‘next levels’ of the pyramid
It becomes critical for the CFO to be able to incorporate certain ‘soft skills’ (one of his or her ‘unfinished business’), in order to improve interrelations with his or her peers, since to become a good leader, any ‘technical’ knowledge is necessary, but not sufficient, and emotional management is decisive for the development of his or her functions.
We come to the fourth level, that of the ‘need for recognition’ of his role, not only within the organisation by positioning himself as the ‘natural’ advisor to the CEO, but rather with a wider stakeholder view, linking him in his leadership position to the social environment of the company, including shareholders, employees, customers, suppliers and associated groups
It does not cease to be the category that grants the CFO the greatest relevance in their relationship and value contribution to the company, where their functions are recognized by other areas of the organisation and likewise by shareholders, whether directly or indirectly.
Their recognition is necessary to attempt to "ascend" to the last of the phases and most difficult to achieve, that of "actualisation needs," with the desire and pursuit to reach the highest level of their management, not only from a professional perspective but also personal, where their feeling is one of having achieved the proposed individual goals and those of the organisation.
In summary, the evolution of the CFO's functions is a process that is still pending completion, which will allow them to assume in the future an increasingly strategic and key role in achieving the company's objectives.
