Leadership
Not Just Debits and Credits: The Changing Role of the Controller
Can controllers be profit centers for their companies?
Traditionally, controllers have been firmly on the cost side of their companies. They’ve been the historians looking in the rearview mirror. They made sure the numbers were right and that all the tax and regulatory filings were taken care of. Their job — at its core — was to provide accurate and timely financials to the C-suite.
As a new crop of controllers emerges, their role within the organization is evolving. Controllers now work more closely with the C-suite to influence the direction of companies. A recent joint survey by Deloitte and the IMA calls this group “strategic controllers,” and notes that controllers who move beyond the boundaries of traditional duties of controllership have an easier time stepping into the CFO seat.
It’s not just the jobs of controllers that are changing. Over the last decade or so, the traditional roles of everyone in the C-suite have shifted. In a recent Journal of Accountancy podcast episode, Scott Simmons of Crist Kolder Associates discussed the changes he’s seen over the 15 years that he’s overseen their annual Volatility Report, which looks at turnover in the C-suite, now at an all-time high.
Simmons said that the biggest change he’s seen is the disappearance of the COO position. Over the last 10 years, there’s been a 15 percent drop in the number of companies with COOs. This is partly because boards, investors, and other stakeholders “…have wanted CEOs to be less of an external facing endeavor and more of a hands-on endeavor.”
Another part of this is the evolution of the CFO position. According to Simmons, the role has shifted from a “…debits and credits accounting and controller orientation to having a CFO who truly understands how the business operates and who can act in a capacity of a business partner to the CEO. The COO chair and the requirement for it in certain companies has been squeezed out.”
from Controller to CFO
This means is that controllers who want to be CFOs need to demonstrate they know more than the latest accounting standards. According to the Deloitte study, a challenge for controllers is that although they want to spend about half their time on higher-level work and tasks that add value to their companies, they’re still spending 70 percent of their time on activities like closing books and ensuring compliance. They don’t have time to sit in on meetings with the CFO and other executives to review strategy. Even if they do find time and energy for high-level tasks, controllers don’t feel they have adequate skills. More than half of the controllers in the Deloitte survey say they need to improve their strategic thinking.
do you know your tech?
According to the study, more than a third of the controllers cited inadequate information systems as a top reason that kept them from doing the strategic work they want to do. For younger generations, it’s frustrating that they have a tougher time getting the answers they need from their ERP than from their phone, and that they still need complicated spreadsheets to get answers they can’t easily get from system reports. Digital natives aren’t interested in manual processes, and you’ll have a hard time leading them if you don’t provide the tools they want to use.
We’ll lend A helping hand
FloQast was built by accountants for accountants to help them close faster and more accurately. By automating reconciliations and improving visibility for everyone, our customers are speeding up their month-end close by three days on average. That’s over a month each year you and your team could use to provide more value to your company; evolving from a cost center to a profit center.
