The Evolution of the Modern Controller

Advancing the Role of the Financial Controller: From Operator to Strategist

Winning organizations expect their finance functions to foster growth and profitability through calculated insights and financial guidance. The CEO and shareholders look to the CFO for expert financial advice and forecasting, which limits their capacity for traditional duties. Alongside the CFO, the role and expectations of the financial controller have evolved to include more functional duties.

Controllers are finance experts and organizational leaders who need support to assist CFOs in driving long-term growth.

The Evolution of Chief Financial Officers and Controllers

To understand the current expectations of controllers within the finance function, it is important to consider how the role of the CFO has evolved. Historically, the finance function was viewed as a hub to deliver financial reporting and recordkeeping, and the CFO responsibilities included overseeing day-to-day finance processes and the productivity of their teams.

Over the past two decades, companies have learned the importance of agility and strategy to safeguard the bottom line. This shift in business changed the role of the CFO from transactional to transformational in creating systems to reduce costs, create value, and predict future performance. CFOs offer expert leadership for short and long-term financial decisions, while many of the tactical finance duties are now the responsibility of the controller.

Controllers are universally overwhelmed, as they tackle a workload packed with manual, day-to-day tasks.

The primary duties of the controller were once financial management, oversight of assets and risk, and operational efficiency. Now, the present controller is obliged to manage duties such as: mentoring staff members, external relationship building, tax strategy, overseeing auditing and invoice approvals, preparing budgets, creating financial statements, and more.

From inefficient or inconsistent technology to team reductions, the responsibilities of controllers continue to increase while the amount of support they receive remains stagnant. A 2018 study conducted by the Institute of Management Accountants and Deloitte found four distinct roles controllers can fill within an organization: stewarding assets and managing risks, operating efficient and effective finance functions, strategically directing the future of the company, and being a catalyst to drive execution.

Many controllers spend nearly 70% of their time in the stewarding and operation role, leaving them to be overlooked in strategic planning. As a result, controllers can often find themselves overworked and unfulfilled as they desire more important, purpose-driven roles. For optimal performance, CFOs and executives need to understand the advantages of leveraging talented financial controllers. With the proper support, controllers can drive operational performance beyond the finance function and across the entire organization.

The working relationship between a CFO and controller is a vital partnership

CFOs must find effective ways to leverage the expertise within their finance functions. Controllers are strategic visionaries and esteemed members of the management team. There are three key ways CFOs and executives can help advance the careers of their controllers:

Support digital innovation to optimize day-to-day operations

Prioritize digital transformation in your finance function and invest in the digital tools your controller requests. Optimizing accounting processes with tools like AP automation for invoice auditing can reduce the manual workload and eliminate human error. Your controller has access to the financial data leadership needs for planning, but they can provide little value when they are consumed with manually approving invoices and overseeing the auditing process. With more time in their schedule for strategic initiatives, controllers can concentrate on high-level activities like financial analyses or strategizing for cost avoidance and AP risk management.

Encourage collaboration and open up a seat at the table

Work alongside your controller and allow them to aid in critical projects like risk reduction. Controllers have an intimate knowledge of the company’s financial landscape and the keen ability to spot fail points within your finance workflows. Ask them for input on process improvement and give them the authority to develop risk mitigation systems using insights obtained from their analyses.

Develop a more favorable mix of tactical and strategic responsibilities

Completing mundane finance tasks is crucial to the overall health of the business but with the latest artificial intelligence, repetitive processes can be delegated to technology. CFOs can elevate the role of controllers with in-depth and hands-on training, encouraging engagement with senior leadership, and giving controllers the time to contribute creative projects.

Being a financial controller takes an incredible level of skill and education. Although many controllers drive profitability and process controls, it is not a solo effort; they need their CFO and leadership teams to support them in balancing the needs of the business. Controllers should be viewed as strategic partners to the CFO and a crucial part of organizational success.