Financial Skills Leaders Should Improve On

A Guest Post by Noah Rue

Is your role within your company expanding? Are you hoping to move up the ranks soon? Are you looking for ways to set yourself apart from other candidates and co-workers?

Many skills can help you move up the corporate ladder, with those associated with finance among the most important and attractive. Think about it this way: every business runs on money and every business wants to make more of it. Without money, your company would cease to exist. 

Though there’s no shortage of financial skills leaders should improve on, here are four that deserve your immediate attention:

1. Budgeting

It doesn’t matter if you’re a first-time manager or have been in a supervisory role your entire career, you must have a sound understanding of both basic and advanced budgeting principles.

This includes everything from calculating income and expenses to setting goals and making necessary changes as your company evolves.

Just the same as your personal finances, budgeting is critical to your company’s long-term financial health. Most financially-based companies will run a credit check on you, especially for a high-level position. If you have made some poor personal financial decisions in the past, taking steps to repair your credit looks better on a credit report than simply leaving bad debts.

2. Communication

It’s one thing for you to have a solid grasp of the finances of your company or department. But it’s another thing entirely to ensure that everyone else is on the same page.

Effective communication is one of the most important tools a successful leader can have. The way you communicate with others will make or break your career path. You must be able to communicate verbally and non-verbally, all to provide others with knowledge and feedback. Better communication is something you can learn, but it comes with practice. Don’t “hole up” in your office in hopes of avoiding communication. Seek it out. 

3. Collaboration

The best financial leaders know what it takes to successfully collaborate with others. For example, you may need the help of the accounting department and human resources department when creating a budget, approving expenses, or making key financial decisions. This goes along with the ability to communicate with a high level of efficiency. Regular collaboration is an often-overlooked financial skill that can set you apart from others in your field.

Collaboration comes in many different forms, both within your company and externally. Maybe you need to hold an interdepartmental meeting to update your team on financial changes. Or maybe you need to consult with an outside accountant or tax professional to discuss financial matters. The more you collaborate with others, the more comfortable you’ll become doing so. 

4. Cash Flow Management

Cash flow management is a big part of any business, large or small. If you don’t at least understand the basics of cash flow management, it’ll be difficult for you to rise the ranks within your company or industry.

In many ways, cash flow management is the most important financial aspect of your business. And for that reason, proper oversight is a must. With positive, healthy cash flow you’re able to comfortably manage your expenses while also using funds to expand.

Conversely, if things are looking bleak from a cash flow perspective, it can result in a variety of future issues, ranging from employee layoffs to cutting back on travel and expenses. It takes time to better understand cash flow management as it pertains to your company, so don’t hesitate to dig in and learn as much as you can. 

Final Thoughts

As a leader, you need a variety of skills to perform at your peak. When you have a solid understanding of all aspects of finance, you’re in a much better position to do your job with hopes of expanding your role.

Remember this: It takes time to develop these financial skills—among others—so don’t hesitate to kickstart the learning process. The sooner you get up to par, the better chance you have of expanding your role.