CFO Leadership

A recent report says financial executives need the right exposure, technology, and team members to take on a larger organizational role. Even if you’re a fan of the whole “open concept” office space, it’s unlikely you’ll ever see a CFO’s desk set up in a company’s reception area. Still, let’s just pretend for a minute. What would customers who walk to the CFO say? After realizing the person they’re talking to was not, in fact, an admin assistant, might they wonder why someone historically considered a “bean counter” was manning the front lines? Or would they start to appreciate a senior leader who saw a direct link between customer experience and financial performance? Something almost as radical is contained deep within a report from the CFO Alliance which sums up a series of roundtable discussions the association held over the course of 2016. Acknowledging that it was a new frontier for many financial leaders, the report suggested the time has come to get closer to the action: Historically, CFOs have had limited interactions with customers, most often times only engaging them when there are issues to be resolved relative to accounts receivable. The good news is that CFOs recognize that they need to develop relationships with customers in order to better serve customer needs, manage customer perceptions, deliver value, and identify opportunities to deepen and strengthen relationships. Investments In IT (And People) It’s not just about shaking hands or schmoozing with those making purchases, however. The report goes on to recommend a series of investments that may not obviously have a tie-in. It’s about “ensuring the right systems are in place to optimize the visibility into all actions that impact the customer experience across the enterprise,” the CFO Alliance says. This includes, “integrality of business systems-ERP, CRM, CPM systems which can include social features that allow real-time chatter within these systems.” Download: Vena Web Dashboards Datasheet The third element in all this is working with the people who can make sure those systems can meet those needs. This may not be those who have traditionally worked in a finance department. They may, in fact, be from entirely different functions or even third parties. “[CFOs are increasingly] not constrained by capital, they’re constrained by engineering resources and they’re constrained by time,” John Gaybrick CFO at payments provider Stripe, recently told Business Insider, which went on to say, “It’s in the best interest of the CFO’s office to help ensure discipline and focus, making sure that the company is spending those resources on things that will turn into revenue for the company. It adds a ‘new dimension’ to the job.” That dimension, however, may be one that brings CFOs the most fulfillment in the long run. The post The Case For Bringing CFOs And Customers Closer Together appeared first on Blog | Vena Voice | Vena Solutions.

Major merchants can’t seem to hold onto their finance leaders. Those with staying power need to work differently. The whole point of success in retail is getting customers to stick around for a while — or at least until they can make a purchase. Lately, however, the bigger challenge seems to be finding CFOs who don’t make a break for the exit prematurely. Bloomberg took a quick analysis of CFO comings and goings among some of the most well-known merchants in the U.S., and the results are eyebrow-raising: while one-fifth of American retailers put a new head of finance in place in 2015, the past year saw another 45 walk out the door. “Wearing different hats is clearly taking on a new meaning when it comes to retail CFOs.” Of course, retail is often viewed as one of the most “disrupted” industries, with the rise of e-commerce, then mobile commerce, and now the Internet of Things shaking up the way products are merchandised, marketed and sold. The Bloomberg story suggested that it’s time to start mulling why those disruptions might pose a problem for those occupying the CFO role: Useful skills for a retail CFO these days include closing stores, executing turnaround plans, and slimming down corporate structures. Skills that aren’t traditionally part of the CFO toolkit — such as coming up with big-picture strategy, operating stores, and websites, and parsing customer data — are also becoming more important. Join our webinar “The CFO’s Guide to Better Budget Collaboration” to hear from Kelly DeWispelaere, Director of FPA at ADAC Automotive, on the best practices her company employs throughout its budgeting process. In ‘Retail industry: New year, new CFO,’ Pymnts.com contrasted these emerging responsibilities from what had been the more standard job description for someone running a retailers’ finance department: “Previously the position focused on growth, from announcing new stores to monitoring the stock price — a cyclical range of duties that also included inventory management and some M&A work as well,” the article said. “Wearing different hats is clearly taking on a new meaning when it comes to retail CFOs.” What do you do when you’re wearing all those hats, though? A post on Chain Store Age offered a list of areas where CFOs could use data to provide insight outside of the traditional finance function. They’re all worth considering, but this one stood out: Develop plans and prioritize as to how to re-design and re-size the store fleet as some stores become less productive and in some cases no longer viable.  Use lower-performing stores in alternative ways such as fulfillment centers to ship from store. The implications on inventory investment by store are significant and CFOs can be very helpful in objectively assessing alternatives. You don’t have to work in retail to see how this same kind of transition could play out in other sectors. CFOs, having a better handle than most on many moving parts of a business, may be able to help successfully manage transitions from established ways of operating and ones that make more sense in the 21st century. Success in financial leadership will increasingly be communicating to the rest of the business what’s really in store. The post The Revolving Door of CFOs In Retail Shows Where Analytics Is Headed appeared first on Blog | Vena Voice | Vena Solutions.

Financial leaders will always need to know the numbers, but they’ll also need to be experts at observing and acting on the mood in the office. Amid all the hype and debate over the impact of artificial intelligence, or AI, on businesses, we may sometimes overlook EI — something just as powerful for CFOs and arguably a bit closer at hand. EI, in this case, stands for emotional intelligence, and while it might be seen as particularly important for CEOs to cultivate, the increased role of finance leaders in strategic decision-making means they should be thinking about it too. Like IQ, which measures intelligence, EI is also sometimes referred to as EQ or “emotional intelligence quotient). You don’t necessarily need to take a test to determine your score, but a post on YourStory.com interviews a behavioral psychologist to break it down into five pillars. Those with strong EI have a high level of self-awareness, for example, and self-regulate their emotions as needed in the workplace. They also demonstrate empathy, are self-motivated and generally get along well with others. Compared to IQ, “emotional intelligence emerges as a much stronger predictor of who will be most successful because it is how we handle ourselves in our relationships that determines how well we do once we are in a given job,” the post said. A recent article on CGMA Magazine suggested much the same thing. The author looked at some of the specific ways EI would help CFOs thrive. CFOs must step out of their traditional comfort zone and become much more outgoing, able to relate to people, and able to see the big picture and beyond. They need to speak to their counterparts in person and use their EI skills to find out where resources are truly needed. They cannot just focus on reporting numbers and allocating funds instinctively. Of course, this isn’t to suggest CFOs should be over-reliant on the emotional cues of their peers and coworkers. In fact, Reader’s Digest reported on a study that showed those with high EI may be more prone to stress than others. Maybe it’s best to think about it this way: start with the same empirical data that finance departments have been managing since they were first created. Use analytics to derive the best, most actionable insight on how to improve business performance. Then, observe and take into account the emotions of all the human beings who will be involved in making that strategy real. Once the strategy starts to pay off, you’ll start to notice some truly positive emotions at work — employees who only want to take that success even further. The post The Case For More Emotionally-Intelligent CFOs appeared first on Blog | Vena Voice | Vena Solutions.

A report from consulting firm BearingPoint breaks down the skills and focus areas finance leaders are beginning to take on. Most companies would probably say they’d like to see “exponential” growth — until they realize the workload of their senior team might need to grow exponentially in order to do so. When you sit down and read “The Exponential CFO,” a report from consulting firm BearingPoint, however, it becomes apparent that the increased scope of finance leaders’ roles doesn’t have to leave them exhausted. That’s where technology comes in, a point that those surveyed as part of the research already seem to understand. These are some of the most significant stats to prove it: 75%: The ratio of CFOs who believe technology will have a big impact on their business in general; 62%: Proportion of businesses than plan to leverage technology to facilitate analysis and decision making; 57%: Those planning to use technology to help with ongoing monitoring of business performance. BearingPoint says companies need to make sure CFOs are well-equipped with the right tools to take on their increasingly important job. “Frequently, customer-facing initiatives with a perceived direct impact on the top line and core production or service processes are receiving the funding, while the CFO’s internal processes are receiving the short end of the stick when it comes to innovation and the required investments,” the report says. “However, in our opinion, companies should aim for a balance between innovation for external or core business purposes and the supporting of internal processes that also need to evolve.” The online magazine Consultancy provided its own analysis of the BearingPoint study and recommended companies begin with their end goal in mind: “One of the key changes for CFOs is that their time, the lion’s share of which is taxed by transactional and retrospective tasks is partly freed by new technologies that streamline those operations, or leverage results from those operations for more forward-looking projections. These projections can in discussion with the CEO be used to develop new opportunities, underpin, or proactively finance, business strategy.” There’s no magic moment when you’ll suddenly be called an exponential CFO, of course. BearingPoint suggests that those will rise to the challenge may be defined in many other ways. This includes “business partner, financial storyteller, change agent, shareholder guardian, learner and facilitator, and digital mentor.” If that sounds like a lot of different skill sets to master, don’t panic. It also shows that, with the right tools, there are an exponential number of ways the CFOs of the future can shine. The post Why CFO Career Prospects are Getting Exponentially Better appeared first on Blog | Vena Voice | Vena Solutions.

Management experts say finance departments need to factor in data from other business units, but will this lead to a war over metrics? Hopefully it never gets to this point, but eventually someone might get angry enough to ask their CFO something along the lines of, “Who died and made you KPI king?” Metrics matter to everyone — or at least they should. Understanding business performance should be the foundation of how CEOs lead, and how other members of the C-suite collaborate around shared objectives. This is assuming everyone agrees on what’s being measured, and that there’s some way to gather and assess all the inputs that go into the act of measuring. “One of the best ways for an organization to improve its performance management environment is to have the CFO partner with the rest of the business in the development of more-balanced metrics.” Beyond the standard key performance indicators (KPIs) that finance departments have always used are an ever-increasing number of non-financial ones. Even those KPIs relate to activities that happen in sales, marketing or other departments, though, the data has to go somewhere, and a group of experts recently told CFO Magazine that they should all come straight into finance. Of course, this could rankle some members of the team, but it doesn’t have to turn into a turf war: The answer is not for a single executive to police other executives’ use of KPIs, but for the executive to be a fulcrum for sharing the data. “One of the best ways for an organization to improve its performance management environment is to have the CFO partner with the rest of the business in the development of more-balanced metrics,” says Balogh. “The goal is not for the CFO to micro-manage or own the metrics, but to analyze their interrelationship.” That kind of analysis doesn’t just involve technology (though of course that plays a crucial role). It also involves a sophisticated, diplomatic approach to working with all those various stakeholders so that they feel more empowered than scrutinized. An executive from consulting firm PwC touched on this in a recent post that underscored why the CFO is uniquely qualified to play this kind of a role. “In most organizations, almost all decisions tend to have financial impact. Key investment decisions, business transactions, resourcing and many more all require an element of financing,” the article said. “In order to be relevant, they must go beyond the numbers and always challenge status quo. The future is about being strategic, insightful, technologically inclined and commercially being a partner in the business.” The CFO and his team are not merely the kings of KPIs. They are the ones with a golden opportunity to make sure the crown jewels of that make measurement possible — the organization’s data — shines in as illuminating a way as possible. The post Why CFOs Play a Key Role In Tracking Non-Financial KPIs appeared first on Blog | Vena Voice | Vena Solutions.

The future of the finance department may depend on how well leaders navigate potential generation gaps. Walking in 20 minutes late, expecting only the most exciting assignments, piping up when it would be far better to listen — the portrait of the stereotypically nightmarish Millennial employee in the finance department practically draws itself! Of course, those cliches would never apply consistently to the next generation of talent managed by CFOs and others in large companies. Concerns about how best to motivate, coach and hold onto younger professionals, however, is becoming nearly as important to financial leaders as many of their more traditional priorities. “For all the talk of discord between Millennials and their elders, there’s a lot of promise in how the relationship could play out in finance departments.” When CGMA Magazine recently published an article about ‘5 Tips To Ease CFOs’ Worst Worries,’ for example, the majority of the advice came from recruiters who say their clients in the U.S. and Europe are losing sleep over workplace issues with Millennials. To some extent, it begins with figuring out what it is they really want: “Salary is important, but so are non-monetary benefits and the work environment. Millennials in the UK focus on work/life balance, which means they want to be able to work from home, dress casually, or leave early,” the article said. “Many young finance professionals in France no longer want to start their professional career in auditing . . . Instead, they prefer to go to work for start-ups and tech companies, where they can be entrepreneurial, take on more responsibilities earlier in their careers, and get involved in a broader range of projects.” An in-depth feature report on CFO Innovation indicated many of the same issues. One of the more interesting sources interviewed was Niq Lai, Chief Talent & Financial Officer and Co-Owner, Hong Kong Broadband Network. He said his fellow CFOs should think of Millennials more like partners than underlings. Millennials could be daring because they are less experienced—this is often seen as a weakness. However, Lai said managers can turn that into a strength. “They have no idea what works and what doesn’t, so you can let them try new things with calculated risk,” Lai noted. “Millennials make mistakes but they’ll learn from them. I call that ‘stumbling our way to success’.” Older, more experienced CFOs may stumble their way to success as well, naturally, but Lai and others argue they need to talk more openly about their missteps in order to earn trust and pass on their wisdom in a palatable way. In fact, for all the talk of discord between Millennials and their elders, there’s a lot of promise in how the relationship could play out in finance departments. Evolving from number-crunching to strategic analysis will definitely involve greater experimentation and potential failure, but it will also involve work that’s just as valuable and fulfilling as what you could do at a tech startup. Smart CFOs already know Millennials represent the future of their team. It’s a future that could be brighter than anyone realizes. The post A CFO’s Guide to Working with the Millennial Generation appeared first on Blog | Vena Voice | Vena Solutions.

Yes, the job of a CFO has never been tougher, but there are already signs of what success could look like. CFOs already know they have a tough job. They probably don’t need the constant reminders about why it’s so tough. Just a few weeks ago there was a piece whose headline declared that 2017 will be the “proving ground” for CFOs and their teams, itemizing all the reasons they’re stressed. “Finance leaders were already under considerable pressure to modernize business processes and help their organization stay ahead of disruptive competitors,” the article said. “A slump in oil prices and the recent EU referendum vote in the UK have only piled more pressure on CFOs to successfully lead their organisations’ strategy in a constantly fluctuating economic climate.” “The wider adoption of cloud-based accounting and finance systems is expected to make it easier to share and view data going forward, giving all departments greater access to risk analysis.” Those are just the macro factors. There can be just as much turmoil going on inside a particular organization. Think about Pearson, the publisher which has already announced plans to eliminate 4,000 jobs and sell off a variety of its non-core assets. Financial Director magazine recently profiled its CFO, Coram Williams, who sounded like a great role model for its peers in terms of keeping a level head. Williams says his primary focus has been to “closely and forensically – and in a data driven way  – look at what is happening in our markets. Having done that, you have to have that position clear as the CFO; and then you have to formulate the right response with your executive partners; and it then requires a focus on change management, cost management, execution and indeed resilience as you push that agenda through based on the analysis you’ve got.” The Power Of Transparency That doesn’t mean Williams is trying to steamroll people. It’s about making sure the data that informs your own decisions can be easily accessible by others. Consulting firm PwC did some research in this area, with a survey in which 75% of CFOs polls said partnering with other areas of the business on risk-specific metrics could lead to better decisions. “The wider adoption of cloud-based accounting and finance systems is expected to make it easier to share and view data going forward, giving all departments greater access to risk analysis,” the firm said. Once those partnerships begin to pay off, CFOs and other business leaders will not only find themselves better able to steer the ship through their specific organizational challenges but perhaps even some of the global challenges common to companies everywhere. And maybe, at that point, we can stop talking about how tough the CFO’s job is but how well CFOs are doing it. The post The Macro and Micro Factors Influencing CFO Leadership Styles in 2017 appeared first on Blog | Vena Voice | Vena Solutions.

Companies can’t afford to set loose goals around corporate performance management. Start by picturing the ideal end state. We may have already reached that point in the new year where, if you haven’t actively started trying to lose weight or get in shape, it’s not going to happen in 2017. Goal-setting is easier than goal-getting, of course, but Alan Hart is betting on the power of positive visualization to make at least one potential resolution come true.  In a recent post on Business2Community, the technology industry consultant reflects on the many finance teams that want to change the way they work, or who work in companies determined to develop a more forward-looking strategy, but somehow fail to make the leap. That leap, as Hart defines it, is to move to more advanced applications than what tend to be found among CFOs and their staff today. He describes a future where an alternate reality looks a lot more attractive: With each accounting period close, you became more familiar with your new CPM (corporate performance management) solution and found ways to improve the reporting presentation and the interpretation of the data the system provides. The second annual budget you prepare with your new software will be much smoother. You’ll discover more ways to collect budget data from operational units. You’ll learn to better use the system’s built-in logic to create forecasts driven by data and applied logic to perfectly match your business model, and you’ll appreciate the software’s built-in accounting rules, which immediately result in more meaningful reports. “The best CPM projects are profitable and allow the company to compute a positive ROI.” Who wouldn’t want that? The big stumbling block may be that CPM is just one priority among many in the enterprise, and organizing the various stakeholders who need to get it in place seems like an overwhelming effort. If that’s the case, it’s worth looking at ‘Project Planning For A New Corporate Performance Management System’ on TechTarget, where another consultant outlines some of the key steps to keep in mind. This includes: Decide where CPM should be implemented Decide where and how work that involves CPM gets done Identify project leadership Choose the right CPM solution Ensure interoperability/integration with existing systems You could argue about which of those steps should come before the others, but one in particular might help galvanize such projects in general, which the author summed up as follows: “It is particularly important to understand why you are undertaking the project. On a simple level, your budgeting techniques may be poor and you want to get budgeting under control. Or you may need to report consolidated financial results,” the article syas. “The best CPM projects are profitable and allow the company to compute a positive ROI. For example, you might want to cut costs by 10% without impacting revenue or quality. Give serious thought to how a corporate performance management system can improve your bottom line.” Everyone knows the new year’s resolutions likely to be achieved are specific, measurable, action-oriented, results-driven and time-based, or SMART. This is the year a lot of companies are going to get particularly SMART about CPM. The post The Biggest CPM Decisions You Have to Make appeared first on Blog | Vena Voice | Vena Solutions.

Tech execs are taking over finance. Finance chiefs are taking on IT responsibilities. It all points to one thing. By changing the “I” to an “F” in the middle of his title, Martin Chavez is about to answer one of the great big “IF” questions in large organizations: can the person formally responsible for technology take the reins of finance as well? Business media were quick to take note of the recent appointment by financial giant Goldman Sachs of Chavez from CIO to deputy CFO, with a plan for him to take on full financial leadership early next year. According to the Wall Street Journal, other organizations should take such a move as a sign of the times: The announcement that R. Martin Chavez, Goldman Sachs Group Inc.’s chief information officer, will become the investment bank’s new finance chief is testimony – if any is needed – to the increased importance technology is playing in the financial services industry. “Putting the CIO in the CFO position just puts an exclamation point on that,” said Jeffery Harte, an analyst at Sandler O’Neill + Partners. “Technology has become more important.” When Roles Converge  This isn’t completely unprecedented, of course, and it can happen the other way around, too. As the Journal and others reported last year, for example, Jockey International managed to poach Dain Bussewitz, the former VP of finance at  Abercrombie & Fitch, and made him both CFO and CIO. Around the same time, PepsiCo announced that its CFO, Hugh Johnston, would become a vice chairman and take responsibility for the company’s IT systems. It’s not that running finance and IT have become so easy they no longer need their own leadership, of course, or that the skills are interchangeable. Instead, these organizations may be trying to ensure that by either consolidating the two portfolios under one position, or putting a technology expert in the CFO’s chair, critical decisions about the way the organization operates will happen more quickly. Not everyone will be prepared to shake things up to this extent, which is why Information Week recently published a piece on 5 reasons the CIO and CFO should be best friends. The over-arching conclusion is that an alliance strongly benefits both sides: “In many organizations, the CIO will still report to the CFO, but the trend is for a direct reporting relationship between CIO and CEO. In general, that’s good for the CIO, but it brings complications, as well,” the publication wrote. “Why is the CFO such an important executive partner? The answer boils down, of course, to money, but the money is reflected in influence. In most organizations, the CFO is a principle trusted ally of the CEO and a key member of the executive committee.” There are many ways to set up areas like finance and IT, but it comes down to this: can you get the right technology in place to drive the right business outcomes? That’s a “what if” many organizations should aim to answer as early as possible in 2017. The post The Surprise CIO-CFO Changes Are About Much More Than Job Titles appeared first on Blog | Vena Voice | Vena Solutions.