CFO Research – Samuel's CFO Website

July 6, 2016 By Samuel Dergel 3 Comments

CFO as Chief Growth Officer?

What exactly is the role of the CFO anyway?

In my book, Guide to CFO Success, my first chapter discusses what a Chief Financial Officer is. I say that the CFO needs to be a Strategist, Leader and Advisor, and those that act as such are able to become the business leader their company needs.

My perspective is not the only perspective on this topic. Those that follow the continuing discussion in print and online about the Chief Financial Officer see numerous perspectives in blogs, whitepapers and articles about what the CFO really is.

One whitepaper I came across recently was an EXL whitepaper entitled Chief Growth Officer: A new role for today’s CFO. The whitepaper was of interest to me because it discussed how the head of finance, which in many organizations has been very compliance oriented, can (and should) make the transition to a more strategic role. The paper describes the idea of CFO as

Click to download larger graphic

…a “Chief Growth Officer”, a newer, more sharply focused evolution of the notion of the CFO as a “strategic partner” to the business.

The paper also includes an infographic detailing the difference between the “Traditional CFO” and the “Modern CFO”

For those with an interest in the evolution of the Chief Financial Officer, this paper offers some worthy insights on how CFOs can move beyond the traditional and lead growth in their organization.

To gain a better perspective on the CFO as “Chief Growth Officer”, I spoke with Vince Sparrow, CPA & CGMA, VP and Client Executive at EXL.

Samuel: Why is Growth so important for the CFO?

Vince: Growth is important for the CFO because it’s important to CEOs, boards and investors. CFOs who help drive the strategies that create growth not only increase shareholder value they also differentiate themselves as active partners to the CEO and the business. CFOs’ access to a broad cross section of data and the analytical skills with respect to finding and interpreting that data can make the difference in carving out new or more profitable businesses. Doing this quickly and efficiently requires utilization of new cloud and automation tools.

Samuel: Why do some CFOs miss the opportunity to help grow their business?

Vince: Some CFOs miss the broader opportunity because they are stuck in the older model as the organization’s scorekeeper and, a bit more advanced, as more passive advisor to the business. They may also spend so much time in gathering and validating information that they lose out on the opportunity to truly understand the implications in the patterns in the data – including external macroeconomic and political data.

What are your thoughts about CFOs being organizational leaders for continued growth in their organization?

June 14, 2016 By Samuel Dergel Leave a Comment

CFO: Your Finance Team is Holding You Back

If you have been following me for a while, reading my blogs and my book, Guide to CFO Success, you will know that I believe that relationships is the area where CFOs ‘make it or break it’. I continue to speak to CFOs about this because of the direct impact that successful relationships has on the Chief Financial Officer.

When I ask CFOs if relationships are important, all of them agree. Yet when I ask them about to discuss the challenges they have in their corporate relationships, the conversation can go on for quite a while.

Each of the 4 areas of corporate relationships for the CFO (who they report to, work with internally and externally, and who works for them) are important. The CFOs relationship with the CEO is super important. I do not know a CFO who thinks that it is not important to keep their CEO happy.

Yet keeping the CEO happy means that you need to work on your other relationships as well.

A recent Forbes article pointed me to a KPMG report mentioning that “CEOs are relying more and more on the CFO to be their partner”.

Note one of the key findings in this KPMG report:

CEOs put a huge value on people skills, but many see their CFOs as lacking in this area. Almost all (97 percent) of CEOs say that attracting and retaining top-notch finance talent is the most or equally important contributing factor in improving the finance function, yet only 33 percent give their CFOs a passing grade in talent management.

As CFO…

Do you have a passing grade in talent management?
If you do have a passing grade, shouldn’t you be a top performer when it comes to talent management?
Is your Finance team holding you back?

There are resources available on how to improve so that you can score higher on managing your talent (including, but certainly not limited to, my book and blogs). I have found that unless you (the CFO) make talent management a top priority, you will continue to limit your success.

CFOs can only be as successful as their Finance team allows them to be.

I’ve helped others and I can help you. Don’t let your Finance team hold you back.

June 7, 2016 By Samuel Dergel 9 Comments

CFOs Under Pressure

I speak with many CFOs in my role as executive recruiter, CFO Peer Group facilitator and executive coach. Each CFO, without fail, expresses that they are busy. The scale starts at ‘busy’ and goes all the way to ‘overwhelmed’.

So I was not surprised to see the results of this recent report from EY. I appreciated this infographic, as it helps to explain why the Chief Financial Officer is feeling overwhelmed and under pressure.

These four survey results identify two areas of pressure facing the CFO today.

Weak finance team (Ability to delegate, Concern over finance function)
The day to day gets in the way of the strategic priorities (Tension between old and new, Role stretch)

I showed this graphic to member of my CFO Peer Group, and here is some of the feedback they gave:

Weak finance team

We have under skilled people in place as we cannot “afford” to recruit at the experience level we need
The CFO is being asked to cut staff significantly while taking on additional responsibilities and regulatory burdens. This all needs to be performed while changing and upgrading staff to meet more strategic priorities

The day to day gets in the way

We are so transaction heavy we need more staff to keep up with the day to day
Under increased pressure to meet compliance demands with no legal or other support
The CFO often lacks along with his organization an understanding of the business is one I see quite often from business partners
While there has been an evolution in what else the CFO is responsible for, the CFO is still the defacto compliance officer managing accounting, legal, HR, Facilities, and broad administrative responsibilities.
The CFO is under tremendous pressure today to “do it all”

I also asked my CFOs what can be done to resolve these pressures. Here are some responses.

From a CFO disciplinary viewpoint, you need to define the stands where you say: “this is a MUST to have, and this is a NICE to have”.
Ultimately, the role is CFO is defined by what expectations are.
The CFO often lacks along with his organization an understanding of the business is one I see quite often from business partners. They just don’t visit customers, spend time with sales or other functions.

As CFO, it is your responsibility to deliver what is expected of you. To do so, you need to get the buy in necessary. While platitudes reign, yet not enough CFOs have the ability to change the expectations. Too many times I hear “this is the way it is – I cannot change it”.

As CFO, you have accepted this job in this environment. Either fix it, or find a more reasonable environment. It may not be the environment that’s the problem, but the person in the mirror who accepts the problem environment.

No one wants to just do the best they can (certainly not you). You want to thrive and achieve more, better, further, faster.

You can fix your team – you just need to have a plan and get buy in. As executive coach for CFOs, I have worked with Chief Financial Officers to help them accomplish this. While not an easy task, it will not get better by itself.

You can move from the day to day to the strategic – you just need to make sure you have the people, process and technology that can take care of the day to day to give you time to be involved with the strategic issues.

Here are my recommended steps to break the cycle:

Prepare a vision of how you can focus on the strategic while your team properly covers off the day to day.
Prepare a plan to meet the vision
Sell the plan (classic change management)
Implement it
Deal with exceptions as they happen, yet if exceptions happen regularly, they are no longer exceptions and you need to have the people, process, technology to deal with it.

Sounds simple? It’s not. But unless you are going to tackle this head on, you will be unable to move beyond these challenges and continue to be stuck like most of your peers.

What’s your plan to break the cycle?

November 5, 2015 By Samuel Dergel Leave a Comment

5 CFO Opportunities for the Future of Finance

Earlier this week I shared a new research report by CFO Publishing sponsored by SAP with some insights on the Future of Finance.

Thack Brown is general manager and global head of Line-of-Business Finance at SAP, and I had the opportunity to speak with him about the report. I have had the opportunity to speak with Thack numerous times over the years, including for my book, and I continue to find his perspectives and insights relevant, useful and enjoyable.

I would like to share 5 points that Thack shared with me that I thought CFOs should hear, listen to, and think about further. (This is an excerpt from my conversation with Thack and has been edited for clarity).

1) This is a platform play at the end of the day.

Companies in the general market are currently revaluating their platforms, their ERP, their financial systems, all of that stack, and saying “it’s all changing”. It’s time for me to place the next bet that will be my platform for the next 10-15 years.

2) Know that the CFO opportunity is a big one.

CFOs need to be ready to make the step out of the finance field, into a more comprehensive involvement understanding of the entire workings of the company. CFOs need to expand their role and take on more responsibilities.

3) You are not alone.

Finance professionals are usually challenged when it comes to networking. We tend to be so overworked and focused on our profession that sometimes we can fall into that trap of believing that our problems are only our problems. Talk to your peers. Network, brainstorm and problem solve. This is a valuable resource and should not be overlooked.

4) The next big thing.

Automation. This has been talked about in the finance world forever. The need to move more effort out of the back office and automate it so you can spend more time in the front office. Move past the shared services environment to full automation. The back office of the future will be a just a few highly skilled experts handling, enabling and ultimately evolving the automation.

5) Advice to midsize companies and their CFOs.

Mid-size companies need to keep an eye on the technology transformations of automation and simplification, because this may be not their opportunity to catch up the big boys, but actually leap-frog them entirely. As an example, they could skip the entire shared services phase.

So, CFOs, what do you think?

November 2, 2015 By Samuel Dergel Leave a Comment

Good news CFOs: The Future of Finance Looks Bright (But Only if you Plan and Act)

A new research report released today by CFO Research and sponsored by SAP shows that while Finance has improved a lot over the past years, there is plenty of opportunity to Finance to deliver more value to the organization.

The report, Thriving in the Digital Economy: Four Reasons Why Finance Is Excited About the Future has four key findings that CFOs, senior finance executives and board members will find of significant interest:

Finance professionals are embracing their influence in their enterprises—and looking forward to a bright future as their profession evolves.

The good news is that finance professionals are more influential than ever in their organization, and have opportunities to go beyond core traditional areas of ‘old’ finance. The biggest challenge with this opportunity comes from ensuring that talent with leadership potential in finance can grow beyond the core additional areas.

The organizational scope of the finance function—already broad— continues to expand to encompass risk management, IT, M&A, and other key functions.

Again, as Finance becomes the central organizational address for all administrative and support functions within an organization, can the talent planning match this need?

Finance teams will be challenged to fulfill their core performance management mandate in the face of rapid change and greater business complexity.

High value-add within finance can only happen with the right people, processes and technologies in place, especially as business gets more complex and change continues at a faster pace.

Finance professionals see the rising wave of digitalization and automation as the key to their ability to partner with the business to manage performance.

In a conversation with Thack Brown, general manager and global head of Line-of-Business Finance at SAP, he said that the impact of technology opportunities (digitization and automation) will radically change how the transactional part of finance is being managed, even by those following current best practices.

Stay tuned as I will be sharing parts of my interview with Thack Brown. The insights he offered were fascinating, and combined with this report, provides excellent food for thought for the CFO who is looking to be the best business partner possible to their organization.

July 23, 2015 By Samuel Dergel Leave a Comment

People, Process & Technology in Finance – What is the Right Proportion?

Mary Driscoll wrote another valuable piece for CFOs. Her article in CFO.com – Metric of the Month: Finance Function Costs – gets to the chase on a subject that many Chief Financial Officers face. CFOs have told me that it is hard to be a corporate leader in cost reduction while they need to come back to request and get approvals for increasing their costs to be a better business partner across the business, operationally and strategically.

Proportionate costs of Finance © APQC

You should read the article.

I’d like to address the question Mary asked as she ended her article. In discussing the management of Finance costs, which are composed of People, Process and Technology, Mary asks – What is the right proportion?

Mary believes it is up to each CFO to figure out.

Sounds simple.

But most CFOs are hard pressed to figure it out. If it was easy, the proportion of costs wouldn’t look like this graph.

So where should a CFO start?

Figure out what you’re actually doing. You can hire a consultant to figure it out, but you could, with a little effort and honesty (with yourself), can see what your Finance team is actually doing.

Benchmark and compare. APQC benchmarks are a good place to start, and there are others that exist as well. While they may not be directly correlated to your business.

Prepare a plan. Any plan to improve Finance is a good plan. It is certainly better than just letting things be in Finance. “That’s the way we’ve always done it” is not a plan.

Aim for low hanging fruit. When you benchmark and compare, you’ll see obvious areas for immediate improvement. Identify them and act on them.

Communication & Leadership. CFOs sometimes forget that their leadership role requires that they stand up and stand out. Communicating what you’re doing in a refined and positive way to your team and your company will help get the support you need to make your plan a success.

What about People, Process and Technology? Here is what CFOs need to keep in mind.

Bring on the right People. Bringing on and developing higher level value adding senior finance talent will help you reduce the costs of lower level transactional staffing costs.

Rejig Processes. Does your Finance function have to run like it always has, even though your business has changed significantly in the recent past? If you are running Finance like it’s 1999, and your business looks nothing like it did in 1999, processes need to be significantly updated to fit.

Technology is always a challenge for Finance. Systems, software and other technology solutions can be expensive. Unless your enterprise is going through a wholesale ERP change, focus on Processes and People first. Once that part of your plan is in place, you will have the right Finance ecosystem and culture to properly take advantage of. Dollars on technology needs to be well thought out and prepared for (on the People and Process side) before making significant investments.

Reducing the costs of Finance while improving its impact on the business is possible. Studies show this. While it may sound counterintuitive to someone who has not done this before, learn from the literature.

And if you’re still not sure, ask your CFO Peers about their success stories in making this work.

December 16, 2014 By Samuel Dergel 3 Comments

CFOs: Make 2015 the year you take your game to the next level

With 2015 approaching, many senior financial executives are thinking about what the new year will mean to their workload; deadlines, projects, bonuses (both to pay and to be received), staffing concerns and loads of other stresses. The thoughts are all about what needs to get done and what they are ultimately responsible for.

For the busy and stressed Chief Financial Officer with the weight of the world (or at least their company) on their shoulders, the approach of the holidays and the New Year should give you pause. Think about how to make things better.

There are 24 hours in a day, and, whether you plan for it or not, they will always be filled. As my CFOs told me when writing Guide to CFO Success, more than three-quarters of CFOs are putting in more than 110% of their effort into their role as senior financial executive in their organization.

CFOs are expected to accomplish more than just the day to day accounting and finance tasks. They are expected to be leaders. They need to lead their finance team, lead their colleagues at the executive table and lead the company as a whole. You need to remember that, as CFO, your input is needed to help the company make sound strategic and operational decisions.

As the noted in this 2014 study from American Express:

For eight out of ten respondents, the finance function is a strong, if not dominating, influence on strategic and operational decisions. (See Figure) The finance function is involved with strategic and operational decisions at nearly every company, and 80% of respondents say that the finance viewpoint is either an influential factor or the determining factor.

Amex 2014 study - Figure 7

The expectation is that, as leader of Finance, your opinion counts. What you have to say is influential within the company. Yet too many CFOs feel that they are getting stuck in the details.

How can a CFO get unstuck and take their game to the next level?

Formal training

As an experienced professional, you know you can benefit from continued education that makes a real difference to your career and your employer. Options that can benefit you while meeting your busy schedule can include:

An Executive MBA – This could be an excellent tool to move you beyond the technical you have relied upon to date. Many Executive MBA programs are tailored to the busy executive and should not impact your work schedule much.

CFO oriented Leadership Programs – An executive training program focused on taking a CFO to the next level might be ideal for the senior finance executive that either already has an MBA, or feels the need to build their career knowledge based with a group of similarly experienced individuals. Programs like the Queen’s CFO Leadership Beyond Finance Program, in partnership with FEI Canada, can be an ideal solution.

Online training – When you know what skills you need to improve on and which you need to learn for the first time, online courses can be an ideal solution. If your company has access to leadership and soft-skill courses, make sure that you take advantage of this opportunity. You could also look at service providers like Proformative Academy to give you a choice of options that will suit your training needs, as well as those of your finance team.

Peer Groups

Chief Financial Officers are positioned at the intersection of their finance team, their executive colleagues, and the CEO and the Board. Being at this junction in their organization can make it difficult for them to learn from and share with others. Many CFOs have told me that they feel lonely in their organization, and don’t have people to discuss their challenges with.

The solution to this loneliness can be being part of a group of CFO peers. I recently discussed C-Suite Peer Groups in a blog on BlueSteps. You can become part of an existing group, or create your own.

For 2015, I am creating CFO Peer Groups for a select group of CFOs across the USA and Canada. These selected Chief Financial Officers will commit to work together, learn, share and network with each other. I am excited to facilitate these groups in 2015. I expect that the participating CFOs will take their game up to the next level.

Executive Coaching

Each of the CFOs that I have worked with as their executive coach has been able to step up their game. Executive coaching for the CFO (or future CFO) can be very beneficial to the executive and the company they work for. It is my experience that, like athletes, CFOs perform better with a coach who is well suited for them.

As we approach 2015, it is time to take your game to the next level.

Whether you choose to take the formal approach to learning, get together with your peers to learn, share and network, or engage an executive coach, any step you take to improve yourself and your game is a good step.

What will you do to improve your game in 2015?

November 25, 2014 By Samuel Dergel 2 Comments

Do CFOs read e-books?

In a previous blog (Do CFOs Listen to Podcasts?), I mentioned that I polled my CFO Advisors on their content habits. Here is one more tidbit from this survey.

While CFOs may not be the world’s most voracious book readers (see Jack Sweeney’s LinkedIn Pulse post: Imagine Being a CFO Who Doesn’t Read Books: Welcome to the Bean Counters Club), when I asked my CFO Advisors what book format they prefer to read, 1/3 of them said they prefer to read an e-book, while the 2/3 majority prefers a real paper book.

Here are some comments from my CFOs about their book reading preference:

I don’t read many books.
Gradually making shift to e-book. Reading my first now & getting comfortable!
Use my iPad for many magazines, but like to highlight books and prefer feel of holding book.
Are you trying to make me feel old? It worked.
I like to highlight, etc.

When I began my journey writing Guide to CFO Success two years ago, I had never read an e-book. As I was about to become an author and my book would be made available as an e-book, I felt it was important to understand what an e-book was all about, so I bought an Amazon Kindle. Today, reading an e-book on my tablet or phone is my preferred method of reading, but I enjoy the senses that come from reading and handling a real book.

As the holiday season approaches, consider an e-book as a gift for your favorite CFO. You can tell them that Samuel says they should try it out and join their forward looking peers that are making their way through the digital age.

(I won’t tell them that a main reason you bought them an e-book was because they are very easy to purchase as a last minute gift.)

Happy Thanksgiving,

Samuel

October 28, 2014 By Samuel Dergel 1 Comment

Do CFOs Listen to Podcasts?

As someone who creates content aimed at the CFO and other senior finance executives, understanding what Senior Financial Officers like to consume as content is important. There is a lot of different types of content out there. Traditional content creators like TV, newspapers and magazines are no longer the only providers of professionally oriented content. Professional services firms, associations and groups, software providers and anyone that wants to get the attention of a Chief Financial Officer is creating content to catch the attention of this Very Important Decision Maker.

When preparing to write my book, Guide to CFO Success, I created a CFO Advisor group to seek the opinions of senior finance executives and learn from their actual experiences. As part of my ongoing quest in providing fresh and relevant Finance oriented content, I reconstituted my CFO Advisor group so that we can all learn and grow.

I recently polled my CFO Advisors on their content habits, and will be sharing some of their insights over the coming weeks.

To begin with, I thought it would be interesting to understand whether CFOs listen to podcasts. Most of the content I have created over the years have been in text, whether on my blogs, in other media articles, as well as my recent book. I have never created my own podcasts, but I have been interviewed for a few podcasts over the past while.

As you can see from the graph, about half of my CFOs do listen to podcasts, while 12% of them tune in to podcasts on a regular basis.

It is interesting to see that CFOs are beginning to take a shine to the podcast as a form of content delivery. To get a better understanding of the value CFOs are getting from podcasts, as well as the future of podcasting focusing on senior finance executives, I spoke with Jack Sweeney, host of CFO Thought Leader, a series of podcasts sharing firsthand lessons from leading Chief Financial Officers. I had the opportunity to be interviewed twice by Jack for his CFO Thought Leader podcasts, and appreciated his insights and questions, which led to the creation of valuable content of interest to the CFO.

“Like many people, my “content consuming” behavior has entered a period of great change. I find I’m adopting the ways of my teenagers (early adopters). We depend almost exclusively on our TV’,s DVR and we take an iPad on family trips so we can access Netflix anytime and anywhere. Meanwhile, I’ve begun to listen to the NPR podcast on weekends simply because I added the app to my iPhone.

I find that there is a noticeable shift in my behavior and meanwhile, from everything I’ve read I’m not alone. Why would the behavior of CFOs be any different? Clearly, it’s not, and while CFOs may be laggards when it comes to behavioral changes, they are without question changing their behaviors with the rest of us. Also, I’ll mention once again the car industry’s adoption of in-dash apps over the next few years will also quickly grow the podcast listening audience (CFOs included).” – Jack Sweeney

Sweeney also pointed me to this quote from Tom Webster, VP of Strategy at Edison Research.

“The continued penetration of smartphones in America is changing behavior significantly. We are now seeing activities that were dominated by desktop usage in 2013, flip dramatically to become mobile behaviors. For millions of Americans, the smartphone has become ‘the first screen.’”

Podcasting is just one more distribution channel for content of interest to finance executives. Will CFOs choose podcasting as one of the major ways for them to consume relevant and interesting content as time goes on? Is podcasting a great way to get the attention of the busy CFO?

Stay tuned.

September 10, 2014 By Samuel Dergel Leave a Comment

Together, CFOs and CEOs Create A “Can Do” Culture

Guest Blog by Shane Berry, Senior Vice President and General Manager, Global Client Group, Global Corporate Payments, American Express Company

You can also read my related blog – CFOs should be more confident when dealing with their CEO

++++++++++++++++++++++

To anyone perpetuating the misconceptions that CFOs are accountants, bean counters or number crunchers – among many other outdated stereotypes – it’s time to put them to rest. To the CFO community, these are all but laughable characterizations, reminiscent of a time when CFOs only played an advisory role to the CEO.

Over the last 10 years, the quintessential CFO has been completely redefined. The modern CFO has become the CEO’s strategic partner, emerging as an action-oriented leader with the power and insights to make big decisions.

Countless CFOs have embraced this grab the bull by the horns mentality, resulting in a dynamic role where the CFO is taking action and forging initiatives that have historically been left to other executives, such as the COO or CEO.

Carol Tomé of Home Depot, for example, has championed a number of strategic initiatives since the early 2000s. She slowed new store openings from one every 48 hours to two per year in order to invest in technology, employees and operating efficiencies. Similarly, Mark Loughridge at IBM is credited with simplifying IBM’s message and developing a clear vision for the company to help investors and customers understand what IBM’s future would hold after selling its PC business. Last year, Starbucks CFO Troy Alstead took on additional responsibilities as group president of Global Business Services, expanding his role. In this new position, he assumed duties that include overseeing global financial, technology and supply chain operations.

As these power moves continue, the dynamic between the CEO and CFO is changing significantly. According to the seventh annual American Express/CFO Research Global Business & Spending Monitor, 92% of CEOs rely on CFOs to be either an influential or determining factor in operational decisions for the company.

Traditionally, CFOs would step in at a much later point in the decision-making process, acting as an ad hoc advisor. However, given the unique level of understanding CFOs have of the company, it makes sense that CEOs would tap CFOs as a key decision maker, or at least maintain a higher level of integration.

Since 2008, this relationship has really kicked into high gear. Still shaking off some of the post-recession paranoia, companies are hyper-aware of the need to balance costs in what is still considered an uncertain economic environment. So, in an effort to make every dollar count, CFOs are heading up strategy themselves, and are now weighing in very early on in the decision-making process.

In our research, we found that companies increasingly view CFOs as a catalyst that moves the business forward. When CEOs and CFOs come together, it promotes a “can do” culture within the company, as they are able to troubleshoot and align on the best course of action in real time. Looking to the future, CFOs will continue to work with CEOs more closely and stretch past their normal functional boundaries in order to add new value across the business.

++++++

I would like to thank Shane for his contribution to this blog.

You can view Shane’s LinkedIn Profile, or read Shane’s Bio here.

Share this:

Share this:

Share this:

1) This is a platform play at the end of the day.

2) Know that the CFO opportunity is a big one.

3) You are not alone.

4) The next big thing.

5) Advice to midsize companies and their CFOs.

Share this:

Share this:

Share this:

Share this:

Share this:

Share this:

Share this:

Contact Information