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The Strategist CFO: Four Orientations for Engaging in the Strategy Process - Deloitte

Updated: Nov 8, 2023

CFOs are increasingly becoming the key strategist / business partner to the CEO. Here in the San Francisco Bay Area (and especially in Silicon Valley), the intense competition and rapid technology changes increases the need for CFOs to be active in shaping a company’s strategy. This is especially true for startups and SMBs where the Founder or CEO is wholly-consumed with the urgent, daily operational needs at hand.

Here are some excerpts from the article below by Deloitte which highlight these needs:

As the article below by Deloitte mentions, “CEOs typically want their CFOs to look around corners for new opportunities and potential black swans as well as help transform the company’s products and markets, capitalize and plan for future growth, create and effectively communicate the corporate growth story, and improve decision-making around key investments.”

As by A.J. Lafley and Richard Martin in their book Playing to Win: How Strategy Really Works delineate, strategic choices are the beginning of developing a robust company strategy:

“Key corporate strategy questions include:

1. What are the aspirations and goals of the company?

2. Where will you play? (What products and/or services will your company choose to offer, and in what markets will you offer these products and services?)

3. How will you play to win? (How will your company differentiate itself to gain advantage over competitors?)

4. What distinctive capabilities are required to sustain competitive advantage?

5. What management systems and processes are required to succeed?

CFOs can then bring a financial discipline to support and extend the above strategy process by addressing questions such as:

1. Are the financial goals of the company viable?

2. What products and markets deliver the greatest promise for revenue or margin growth?

3. How should the company organize and structure financing of key investments to generate competitive advantage?

4. What structures (for example, business models; legal and tax entities; onshore, offshore, or outsourcing talent models) and processes (automation, build vs. buy, networking and so on) enable competitive advantage and deliver superior market valuation and returns?

5. What financial and management reporting enables management to effectively execute and deliver the strategy?

The strategy process frames answers to the above questions and executes on them to deliver returns to shareholders. The challenge for CFOs is to choose effective ways to engage in the process in the context of their company’s business, leadership and directors. The four key orientations below outline how CFOs can choose to engage the strategy process.”

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