Why Women with Accounting Experience Make Better Leaders

Those claiming to be experts on business leadership have written novel after novel on what it takes to be a successful leader. As Venkatesh Rao of Forbes asserts, most of this advice centers on leaders having great "people skills." However, according to Rao, "if they only had people skills, they've generally been forgettable CEOs who at best kept the ship sailing on a straight course ... At worst, they've buried their head in the sand ... and let successors deal with the consequences of their not-leading."

While people skills are certainly crucial to leading a team and connecting with clients and investors, all businesses deal with money, which means that women with accounting experience have an advantage when compared to those without such skills. This gives women — who, according to Catalyst, make up a slight majority of the number of post graduates with accounting degrees — an opportunity to step into leadership roles.

Financial Leadership Builds a Successful Business

A recent article by Bplans listed the top reasons that small businesses fail. Among those reasons was poor financial management. "You must know, down to the last dime, where the money in your business is coming from and where it's going in order for your business to succeed. ... Sometimes people start businesses with a dream of making money but don't have the skill or interest to manage cash flow, taxes, expenses, and other financial issues."

Although Bplans suggests using professional business accounting software to solve financial mismanagement issues, software isn’t necessarily required if the knowledge and skills are there. By bringing an extensive knowledge of finances to business leadership, accounting professionals can not only be aware of where money is coming from and where it is going, but they can also influence decisions that will elevate profits and cut losses.

Financial Knowledge Improves Decision-Making

In Rao's Forbes piece on how "Great CEOs Must be Either Technical or Financial," he explains that those with more than people skills can be "more active-navigator CEOs." Rather than turning to other professionals in a business, leaders with accounting knowledge can make more influential and expansive decisions related to the course of the business.

An article from Nonprofit Finance Fund claimed that "Effective leaders know how to interpret and use their data to inform decisions." Women with accounting knowledge understand the data given to them across a spectrum of reports. Such professionals can see the data not only as a measurement of the business's current financial situation but also as a predictor of future success or failure. Knowledge of past and potential future trends can help female leaders steer the business in a progressive direction.

Rao may claim that CEOs consider financial skills in leadership roles "esoteric," but he also says "that to break the game of house-trained CEOs ... and do greater things, CEOs have to understand finance and economics even better than Wall Street, and beat them at their own game in order to pursue opportunities that may have high immediate costs but are great in the long term." Accounting experience allows women in leadership roles to invest in things that build the business for long-term gain.

Accounting Knowledge Gives Women an Edge

According to the National Center for Education Statistics, women are earning more than half of all the college degrees in accounting, with 52.1 percent of accounting bachelor's degrees, 52.7 percent of accounting master's degrees, and 44.4 percent of doctorate degrees being earned by women.

While the majority is slight, with a greater number of women earning accounting degrees than men, women have a greater chance of attaining leadership roles where accounting skills are given priority. Along with the other skills that American Express claims make women better bosses than men, such as being better communicators, having more patience and better business ethics, and more, accounting experience prepares women to succeed as leaders in business.

There may not be a foolproof formula for what makes the best leader, but accounting knowledge gives women leadership skills that can reinforce the current success of a business and ensure that success carries on into the future.

If you need a place to start working toward your future as a business leader, visit Maryville University's online accounting program and learn more about pursuing an online master's degree in accounting. Maryville's graduate accounting program can help you adapt to a dynamic field and give you the tools to lead the field into the future.

Sources

http://online.maryville.edu/resources/msacc/articles/accounting-knowledge-and-business-leadership-go-together/
http://articles.bplans.com/6-reasons-your-small-business-will-fail-and-how-to-avoid-them/
http://www.nonprofitfinancefund.org/blog/importance-financial-leadership
http://www.businessinsider.com/traits-of-great-leaders-2014-12
https://www.entrepreneur.com/article/270486
http://www.catalyst.org/knowledge/women-accounting#footnote6_r1dkego
https://nces.ed.gov/programs/digest/d13/tables/dt13_318.30.asp
https://www.forbes.com/sites/venkateshrao/2012/03/09/great-ceos-must-be-either-technical-or-financial/3/#43cb98d2b0d0
https://essentialsofbusiness.ufexec.ufl.edu/resources/leadership/how-your-understanding-of-economics-can-affect-your-decision-quality/#.WaIj9tGQzIU
https://www.americanexpress.com/us/small-business/openforum/articles/5-ways-women-are-better-bosses-than-men/