What does it take to be an effective controller in 2023? Our expert weighs in

Before the pandemic, controllers had the luxury of being able to stay focused on company accounting and financial reporting, and not much else. But that isn’t the case anymore – especially for controllers aspiring to advance into a CFO role, said Carl Young, a former CFO and CEO now helping out businesses as a consultant, coach and trainer.

In the ResourcefulFinancePro on-demand workshop “The Controller’s New Role: Navigating the Changes in 2023 & Beyond,” Young stated that in the turbulent and technology-driven post-COVID business world, controllers need to seize opportunities to up the ante and become strategic partners, value-adding decision makers, providers of solutions and managers of change.

The controller’s expanding role

Because business and the economy have changed, so has the role of the controller – and it’s changing in ways that may be outside the comfort zones of some controllers. According to Young, to successfully handle the new planning, organizing, directing and measuring responsibilities which are being shifted to the role, the modern controller must have these skills in their tool belt to be successful:

• Effective leadership. “I find a lot of controllers don’t like this whole idea of being in leadership positions. Well, you can’t be an effective controller unless you lead people,” he said.
• Ability to analyze business processes, as well as financial data, so that key stakeholders can make important decisions. “Process analysis is even … more important than financial analysis because it guides us into how we can do things in less time. And time is becoming almost … as important at measuring business success as money,” he said.
• Tech knowledge. Process analysis and asking “how can we do that in less time than before?” will involve identifying software tools and platforms that improve productivity by making things easier and quicker.
• Adaptability, with the ability to re-imagine controls and processes to facilitate change (e.g., new controls that had to be implemented for a paperless and remote work environment, or forecasting and budgeting for multiple scenarios).
• Ability to determine and provide “effective cost services.”
• Good communication, including being able to present critical information in ways that people can easily understand (e.g., using graphics), and
• Knowledge about what’s happening in your industry, in addition to knowing your company inside and out.

3 critical C’s

An important aspect of the business driver and strategic partner evolution of the controller role is paying close attention to what Young calls the “three critical C’s” – customers, costs and cash.

“C” No. 1 – customers: Companies are counting on their controllers to create relationships, including customer relationships.

According to Young, the biggest reasons why those relationships break down are:

• dissatisfaction with how they were treated when things didn’t go right
• they feel the company doesn’t care
• the quality of goods/services, and
• the price of goods/services.

The remedy: Think like your customers, who may be looking more closely at your process than your product. And listen not just to what they say, but also to what they mean.

“When I call the company, do I get transferred around to 10 different people? Do I get somebody on the telephone line who doesn’t know what they’re talking about? It is a process that I’m concerned about,” Young commented.

He named these four “F” “customer focus rules” as keys to success:

• Find your customer needs
• Fit your products and services to provide solutions (just providing customer service isn’t enough)
• Fill customer needs “beyond expectations,” and
• Focus on long-term customer relationships.

“C” No. 2 – costs: Keep in mind that all costs can be controlled at some point and some costs in your framework are controllable in real time. According to Young, as much as 15% of your costs can be reduced easily.

“When revenue bends downward, you can always position yourself to control the costs better,” he said.

“C” No. 3 – cash: It’s vital for controllers to be familiar with their company’s cycle of cash going out to cash coming in. How can you make that cycle so short that you can operate “on the inertia of your own cash flow”?

Running the company with the numbers

Traditional financial statements are not effective for managing a business today, Young said, and controllers need to stop looking at the rearview mirror picture of their accounting records and reports.

Instead, take a proactive approach by using past transactions, records and reports to plan for the future, he said.

In addition, CEOs will be looking to their controllers to feed them trending numbers related to the organization’s:

• Sales volume
• Gross margins
• Pricing and product returns which may indicate a need to change prices or products
• Direct labor
• Overhead, and
• Inventory (“Most companies have way too much inventory,” Young commented).

Save the date

For additional helpful insights, be sure to attend the ResourcefulFinancePro webinar “Turning Uncertainty in 2023 into Opportunities for CFOs and Controllers” on June 15. Click here for details.