On Evolution of the CFO’s Role
Basu believes that the role of the CFO in India has greatly evolved over the years. Earlier the role was more centered around scorekeeping, tax compliances and borrowings. However the new age Indian CFO is expected to do much more. He is required to play a key role in formulation and execution of strategy. He has to manage multiple, and sometimes conflicting, expectationsfrom diverse stakeholders. For instance his advice is often sought on cost cutting initiatives. He needs to be able to distinguish between good cost and bad cost, which is not always an easy thing to do.Often he is expected to manage not just the internal environment, but also the external one. He is a key link with the investor communityand thus is a bearer of good as well as bad tidings. And of course he must continue to ensure that funds are available when and where needed. “As he is also expected to ensure institutionalization of adequate checks and balances to safeguard against fraud he can also be considered to be the guardian of risk.” he says.
Views On The CFO Being Next To The CEO
Not really, he feels. Other functions too play equally important roles. Marketing builds brands, Sales gets customers, Production, Quality Control and R&D ensure great products, HR ensures talent and so on. All are like different parts of a well-oiled engine. You can’t say one is
more important than the other. Ultimately it’s awinning team that builds a great organization.
On Technology and the CFO
According to Basu, use of changing technology in organizations is reducing as well as increasing complexities in the workplace. “Harnessing the benefits of a new technology is a bit like learning to ride a bicycle; it takes a while to master it, for which one has to put in effort. And its only upon such effort that one can cruise. Important technology of the future that the
CFO will need to harness includes Cloud and SaaS.”
On Improvement Areas Within The Finance Function
Basu says that he has found the average finance professional to be usually intelligent, honest and hardworking. But he has sometimes spotted two weaknesses. Firstly, some are not particularly good communicators. He says that when he mentors people, the first thing he counsels is to learn to communicate effectively. Secondly, a few at times have a tendency to miss the woods for the trees. Instead of focusing merely on the transaction level, it makes
eminent sense to sometimes move a bit higher and view the forest.
"Harnessing the benefits of a new technology is a bit like learning to ride a bicycle; it takes a while to master it, for which one has to put in effort"
On What Should Indian CFOs Look For ward To
“Even greater challenges” he says. “I think more CFOs should aspire to evolve into CEOs.And I believe a number of them will indeed make good CEOs,” He also believes that as the demands of regulators, Government and investors increase there is a premium in building good governance, transparency and effective financial controls within an organization. These should not be looked upon as hindrances.
