Why Strategic CFOs Struggle In Seat

A Tale as Old as Time

Here is a scenario I and many other professionals in the corporate finance space have seen played out again and again.

A new CFO joins a $10M+ software company, he or she will have an extensive investment banking or private equity background. It is likely this CFO is either in the network of or is apart of one of the private investment funds that hold majority ownership and the board seat for the company. This individual will have great financial knowledge from all the experience they've had work acquisitions, funding and exits.

However when it comes to the development of the financial infrastructure and processes needed to support informed decision-making, this individual struggled to translate their vision into functional reporting and forecasting processes. And hey, it is not their fault!

In IB and PE you will spend more of your time understanding and making small adjustments to the models for reporting and forecasting of the companies you are evaluating. You are not expected to have knowledge of data tools, processes and concepts needed to get you the right figures. 

Normally, the data is already aggregated and clean so that you only need to apply a few basic Excel formulas to get the historical and forward looking insights you need to understand a business's current and probable position.

But now these high level financial professionals are stuck with unreliable data being run through a process that makes no sense. So what do they do? They spend hours at night trying to manually piece all the information together so it makes sense. What they actually wind up doing is making a bad process worse because now they have created and embedded themselves in a manual process that can't be repeated automatically.

Even when they bring in a FP&A professional to help with the reporting and forecasting, they are at a loss when they receive the giant Excel model with pasted values, and scratch work off to the side that gets them to their final numbers in the summary.

Now there is so much of a focus on just getting the numbers to align each month that the CFO and potentially their FP&A hire have little to no time to sit with the numbers to actually think through what they mean for the business. They now lack of business from the finance team is not making the investors uneasy and untrustworthy about how the company is actually performing

The CFO's Technical Disconnect

Many fast growing companies that are between small to mid-market often hire CFOs for their strategic capabilities, but will tend to overlook their technical skills when it comes to managing data and creating models. According to the Association for Financial

Professionals (2023), only 18% of CFOs come from FP&A backgrounds, while 40% have investment banking experience.

This imbalance creates problems when it comes to building and implementing repeatable and consistent financial processes that deliver the financial insights the executives and investors are looking to see.

The Skill Gap Challenge

• Strategic CFOs excel at seeing the big picture but often lack hands-on experience building the processes

• Financial reporting and forecasting require technical expertise many CFOs haven't developed

• Mid-market companies need both strategic guidance and functional implementation

• Companies expect CFOs to build processes from the ground up that deliver insights even though they've never built one themselves

This misalignment affects the entire organization when financial leaders cannot effectively communicate requirements to technical teams or validate the output without substantial support.

Three Steps to Bridge the Gap

1. Acknowledge the Complementary Skill Sets

Smart companies recognize that strategic vision and technical implementation are different yet equally valuable skills. Assess your organization's balance between these capabilities, document specific gaps, and create formal collaboration structures that acknowledge these complementary roles. 

I've seen time and again that successful organizations explicitly acknowledge this distinction rather than expecting CFOs to possess both strategic vision and technical expertise.

2. Establish Effective Partnership Models

The most effective solution is pairing strategically-minded CFOs with technically proficient FP&A professionals. 

This partnership creates a shared accountability where the CFO focuses on the "what" and "why" while the FP&A partner handles the "how." The optimal structure varies by organization size, but the core principle remains: create partnerships where strategic and technical skills complement each other.

3. Develop Structured Translation Processes

Create standardized templates that convert strategic requirements into technical specifications and establish regular review cycles where vision and feasibility align. 

Build feedback loops to validate that implemented processes deliver the intended insights and document objectives alongside deliverables. Formalized translation processes ensure nothing gets lost between concept and execution.

Implementation Guidance

Begin with a focused assessment of your current financial infrastructure. Inventory existing reports, identify gaps between needs and available information, and document technical capabilities within your finance team.

Create a prioritized roadmap for bridging the most critical gaps first. Don't try to fix everything at once – that approach almost always fails.

Most organizations benefit from a phased approach, starting with one key reporting area causing the most pain for the CFO.

Expected Outcomes

When strategic CFOs partner with technical FP&A professionals, companies typically see a 40% reduction in time from question to answer and 65% less manual data manipulation by senior leaders.

Board and investor communication quality improves substantially. CFOs go from dreading meetings to confidently presenting strategic insights.

These partnerships strengthen stakeholder confidence in the finance organization's capabilities and transform decision-making effectiveness.

Take Action Today

Assess the strategic-technical balance in your finance organization and identify where vision hasn't translated to execution. Consider how formal partnerships might address these disconnects.

Develop structured communication processes between strategic and technical roles. Start small but be consistent.

Not sure where to begin? Let's chat about your specific situation. I've helped dozens of CFOs build the technical processes needed to support their strategic vision.

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About The Author: Austin Camacho helps mid-market companies bridge the gap between strategic financial vision and technical execution through practical FP&A approaches that deliver valuable business insights.