The chief financial officer’s (CFO) position has advanced, especially in recent years. Currently, many boards and CEOs demand far more than just financial results from CFOs. Some also anticipate that the CFOs will partner with them to drive the company’s more comprehensive strategy. Nonetheless, since strategy may vary in meaning to different boards and CEOs, many companies have unique expectations for their CFOs.
Gary McGaghey has tried to help CFOs identify how they can contribute to their company’s strategy by coming up with four orientations for strategist CFOs. Gary McGaghey is a private equity specialist based in London. These particular orientations Gary has formulated focus on unique insights into a strategist’s position. They also bring transparency to the capacity of a company to change its course and try a new strategy.
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In order to move forward, Private Equity specialist Gary McGaghey suggests that CFOs make a number of choices that will help in directing their strategic direction. To make such decisions, Gary recommends that CFOs consider the goals and aspirations of their respective companies. They should also consider the services or products offered by the company and the markets in which the company sells these services or products. When the CFOs pair the answers to these questions with financial discipline, they can devise a successful strategy process for their companies. Gary believes that when CFOs develop a strategy based on those questions, they can deliver high returns to stakeholders. A CFO should be an innovative thinker in order to become an effective strategist and should also hire an effective financial team.
On the topic of having a financial team in place, Gary McGaghey suggests that CFOs should have good communication with the rest of the company’s senior management. They also need to understand the roles and responsibilities of their team members.