The Four Important Roles
At the end of Season One, when I was running out of ideas, I shamelessly asked you to send me some. And you did!
So thanks for that. Now I’ve got fodder to keep this train on the rails.
One interesting request was from @loadlinefinance and @fortworthchris who sent me this piece and asked me to react to the idea that a CFO’s role should be redefined to distinguish between strategic and administrative functions. The reason being that it takes a very different person to be strategic versus administrative, so if you ask the same person to do both you will end up being subpar in one area.
As you may know, I used to be a CFO and if you asked me where I was good and where I wasn’t, I was probably better at being strategic than I was at being administrative. Thankfully, we have others (shoutout Lori) on staff who are great at making sure that we survive things like our 401(k) audit and that no one goes to jail!
But now we also have a qualified CFO and I’ve shed many of those responsibilities, and I think that’s been better for both me and the organization.
That said, I think there’s an opportunity here to be even less specific about roles, but more helpful about achievement. For me, every endeavor, whether it be a project, team, or organization, needs four important roles:
A person who generates opportunities to create variance;
A person who decides which opportunities to pursue (i.e., how much risk to take);
A person who oversees the execution of those opportunities;
A person who measures the results and confirms that the opportunity is as risky (or not) as anticipated.
If you wanted to put organizational titles against these roles, (1) is roughly a Chief Executive Officer, (2) is a Chief Investment Officer or could be a Chief Financial Officer, but could also be a Head of Strategy, (3) is a Chief Operating Officer or maybe a Chief Technology Officer, and (4) is a Chief Financial Officer or Controller.
But I’ve never really liked or understood titles, and also appreciate that many organizations can’t have four or more senior executives, so my advice is if you’re doing anything make sure you’re covering all those bases. And if you’re doing all four yourself, make sure you compartmentalize and don’t let one area dominate another.
– By Tim Hanson
