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September 24, 2014 By Samuel Dergel 2 Comments

What I learned at the Bank of America Merrll Lynch Conference – Treasury in a Connected World

I am pleased that I was able to attend this wonderful conference given by BoA Merrill for their clients. I enjoyed having the opportunity to be the first speaker at the conference, and was honored that many of the following speakers referred to some of my remarks throughout the day and a half.

You can read about what I talked to the audience about in the press release issued post-conference by BoA Merrill, as well as a summary of the conference.

I wanted to share with you is what I learned attending this conference.

Capitalism – Compassionate capitalism is alive and well. Listening to Peter Markell, CFO at Partners Healthcare Systems discussing how his organization is making money helping people was truly inspiring. My personal beliefs include the idea that making money is good, and doing good makes money. It was nice to hear this confirmed by Peter.

Talent – Talent management, including within finance, as well as at the executive level, is a continuous challenge. Winning companies have the talent challenge figured out.

Personal Brand – Finance executives care about their personal brand. Throughout the conference, people came up to me to discuss their LinkedIn Profile and what they could do to improve their brand. This conference reconfirmed to me that too many finance executives are not sure what to do about their personal brand and therefore ignore it until it is too late.

Digital currency – I finally had an opportunity to understand bitcoin, how it works, the risks as well as the opportunity to change and improve treasury, banking and business payment paradigms.

Latin America – I listened to and spoke with a number of people within the bank and companies about the opportunities and challenges of doing business in Latin America. I walked away with a better appreciation for some of the operating, talent, cash management and cross cultural management issues that companies working in this exciting area face.

I would like to thank the team at Bank of America Merrill Lynch for the opportunity to share some of my knowledge with the attendees, learn new and important information, reconfirm some of my core beliefs, and most importantly, meet wonderful people who enjoy making a difference.

Which one of these points resonate with you?

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Filed Under: Bank of America Merrill Lynch, Cash Management, Treasury

August 19, 2014 By Samuel Dergel Leave a Comment

The CFO & CHRO: The discussion continues. Listen in.

On Wednesday August 13, 2014, I was interviewed on DriveThruHR by Nisha Raghavan.

In our discussion, we touched on a few points about the relationship between Human Resources and Finance. Here are some of the topics Nisha and I discussed.

  • What’s keeping CFOs up at night? Talent is one of the top five issues facing the CFO.
  • Who should HR professionals report to? The CEO or CFO?
  • Discussed CHRO Moves and CFO Moves and the difference between the visibility CFOs and CHROs get.
  • Discussed Samuel’s new book, and what it says about the importance of the CFO having a strong relationship with the CHRO.
  • HR and Finance are critical support functions that need to work together to make the business successful. A deeper discussion follows on how HR and Finance can work well together.
  • What are the talent issues that CFOs face? Discussion includes:
    • CFO Succession,
    • Executive coaching for growing finance leadership talent,
    • Managing and building a forward looking finance team,
    • How HR can help,
    • Cross training Finance professionals in HR.
  • How CHROs can benefit from a close relationship with the CFO, as well as how the CFO can benefit from a close relationship with HR. A business partner approach is very effective.
  • Where should companies find finance talent? Everywhere. The right senior finance talent is much harder to find and attract. Companies cannot afford to hire the wrong CFO. There is not only the cost of hiring wrong, but companies are missing the upside of hiring a great CFO as well.

Go ahead and listen in to the entire conversation:

Internet Radio with DriveThruHR on BlogTalkRadio
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Samuel’s CFO Blog is published by Samuel Dergel, CFO and Finance Executive Search Specialist and Finance Executive Coach.

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Filed Under: DriveThruHR, Hire your Next CFO, Hire your Next CFO, How Samuel Helps, How Samuel Helps, Interview, Nisha Raghavan, Radio

June 19, 2014 By Samuel Dergel Leave a Comment

CFO: Your Best Opportunity to Impact Your Organization

Yes. I’m biased when it comes to this conversation.

But I’m not the only one that thinks this.

Numerous CFO research studies, surveys, roundtables, panel discussions and webinars bring up the talent topic again and again.

Talent is a challenge for the CFO.

I have had a successful speaking circuit this past spring, including panel discussions in New York and Toronto, webinars to diverse groups of finance professionals (CPA Canada and APQC), and presentations in Washington and Baltimore. The talent conversation keeps coming up again and again.

I even received this report from Deloitte in my email this morning. Here is what they have to say on the subject:

“Talent availability—and costs. Finding and developing the right talent is invariably a top agenda item for transitioning CFOs. In fact, when we ask CFOs what they would like their legacy to be, a large number actually talk about leaving a sustainable organization that can foster finance talent. To get there means identifying people not only with the necessary skill sets, but also intangibles—such as curiosity and the ability to team—that will help finance become a better business partner. It comes at a cost, though, in terms of developing effective performance management systems, compensation systems, training programs, and coaching. And while human resources should be the natural support organization in all these areas, CFOs often find they have to rely on their own teams to do the work. Still, without the right people in place, there are bigger costs: the inability to execute on a CFO’s critical initiatives and a lack of good finance ambassadors throughout the organization.”

My CFO Advisors, in my blog earlier this year titled The Sleepless CFO,  listed talent as one of the top 3 things that keep them awake at night.

The CFO Relationship Map (mentioned in previous blogs, and in more detail in Guide to CFO Success), shows that CFOs rely on their Finance Team to support them to become the best CFO they can be. Yet CFOs continue to have challenges with talent.

Talent challenges for the CFO include:

  • Not having the right talent they need today
  • Not having a talent plan for the future
  • Not aligning the talent in the finance team to meet the real needs of the organization
  • Not using career planning to keep, motivate and develop the best finance talent
  • Inefficient or ineffective hiring processes for the talent needed today and tomorrow
  • Not having an effective relationship with HR to positively impact the finance team

Talent is an opportunity for the CFO

Yet, with all these talent challenges, the CFO has a great opportunity make a significant impact. These challenges are not insurmountable, they just need attention.

CFOs that pay attention to these issues, even if not getting perfect scores, are in a position to have a significant impact on their personal success, the success of the people that work for them, and the entire organization.

CFO: What is your biggest finance talent opportunity?

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Filed Under: CPA Canada, Deloitte

June 11, 2014 By Samuel Dergel Leave a Comment

Presentation Links: CFO Success #MDSUMMIT

On June 16, 2014 I will be presenting at the MACPA Innovation Summit in Baltimore, MD.

In the presentation, I refer to a number of items for further reading and reference.

Whether you are in attendance at the conference or not, I believe you will find these links of interest.

If you have any questions, please let me know.

Samuel

Links:

  • Book: Guide to CFO Success: Leadership Strategies for Corporate Financial Professionals, by Samuel Dergel
  • Book: The Power of Personal Branding, by Karen Wensley
  • Information: Strong CFO Program
  • Book: Strengths Based Leadership: Great Leaders, Teams, and Why People Follow, by Tom Rath & Barrie Conchie
  • Reference: Samuel’s Strengthsfinder Assessment
  • BONUS: Your very own Relationship Map (.ppt)

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If you attended the MACPA Innovation Summit and would like to receive my new blog posts in your email, click the Sign Me Up! button in the right column.

 

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Filed Under: Financial Executive Coaching, Financial Executive Coaching, Financial Executive Coaching, Financial Executive Coaching, MACPA

February 4, 2014 By Samuel Dergel 4 Comments

The Sleepless CFO

Being Chief Financial Officer can be stressful. The responsibility that the CFO bears for the company they work for is not a 9 to 5 job. Most CFOs I have met and spoken with agree that the role takes up most of the hours they are awake, and even some of the hours they should be sleeping.Couple In Bed With Husband Suffering From Insomnia

So what keeps the CFO awake in 2014?

To find out, I reached out to my CFO Advisory Group. My CFO Advisors were instrumental in providing me with relevant and realistic input as I wrote my upcoming book. Guide to CFO Success: Leadership Strategies for Corporate Financial Professionals is published by Wiley & Sons, and will be available at all fine bookstores end of March 2014.

I recently asked my CFO Advisors what top their top 3 concerns that keep them awake at night. After reviewing their responses, here are the top 3 current issues that are keeping CFOs from getting a good night sleep.

#3 – Team

CFOs are worried about their team. Some CFOs are concerned about how to continue to grow and motivate their staff. Others are losing sleep worried about retaining the staff they need or dealing with the aftermath of unforeseen resignations. There are some CFOs who are unsure of how they will succeed in acquiring and developing the new talent they need to make their team even better.

Regardless of the type team based challenges facing the CFO, they know that they can only be successful if their team is strong enough to support them. When the finance team is not giving the CFO what she needs to succeed, this can cause anxiety and sleeplessness for even the most experienced CFO.

#2 – Growth

Growth can be an issue for many CFOs. Or, rather, the lack of growth is the real issue. Most for-profit companies define success as making more money, and for the Chief Money Counter, growth drives corporate financial success. It is the Key Performance Indicators of this growth that informs the CFO if the company will reach their targets or not.

When companies are continually growing their revenue and profit, all is good. Few companies though, do this regularly and consistently. Financial success for most organizations can only come when sales rise and profitability continues an upward trend. For the CFO, who knows they are king when the results are good, and the court jester when the results aren’t, losing sleep over growth is understandable indeed.

#1 – Cashflow

Cash is King. The ultimate responsibility of whether there is enough cash to do what needs to get done rests with the Chief Financial Officer (even when their team does the technical work). CFOs are concerned with cash from all sides, whether they are collections issues, access to capital and lending or how to make decisions about allocating cash in the most effective way.

Cash is, by far, the most common issue that is keeping my CFO Advisors awake at night. What is interesting about this response is that cash was a concern for most of my CFO Advisors, yet they all come from different industries and company sizes. It seems that cash issues are a challenge in most, if not all companies. While the type of cash challenges will certainly change based on the situation facing a company and its industry, most companies, and therefore most CFOs, are anxious and losing sleep over cash.

What is keeping you awake at night?

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Filed Under: Blog, Blog, books for CFOs, books for CFOs, books for CFOs, CFO Poll, HR, Sales Department

August 14, 2013 By Samuel Dergel 1 Comment

CFOs: IPOs are coming back. Are you ready?

Initial Public Offerings were hot commodities in the early and mid oh-oh’s. Most finance leadership reading this blog remember those days well, and some of you did very well financially because of it.

The recession that occurred towards the end of the last decade put a stop to that IPO train. Companies needing capital for growth had to look elsewhere, and many companies were unable to succeed because this driver of growth dried up.IPO (Initial Public Offering)

For the past few months I have been hearing the rumble of the oncoming IPO train. A number of CFOs I have spoken with in the past months have shared with me that they are being given the strategic responsibility to be ready for when the IPO market comes back. There is a feeling of cautious optimism that this catalyst for economic growth will soon be back.

How can a CFO prepare for the talent challenges to come?

One of the biggest challenges that an uptick in the IPO market will face is that there is a small pool of talented mid-level professionals with relevant and recent IPO experience. The amount of work needed to be IPO ready is significant. When the IPO dam breaks, many companies will be rushing to get their IPO done. If the talent challenges are not planned properly, companies will have to be more reliant on expensive external resources (think audit and law firm rates). Companies who properly plan for their talent needs in advance will be able to go public earlier, which could be very beneficial as well.

Another significant challenge to companies that are currently private is that the cost of being public is expensive. A CFO needs to ensure that they have the leadership and professionals on staff that can deliver the quantity and quality of timely and correct information necessary to be considered a well-run public company. CFOs bear the burden when their finance team is not able to deliver accordingly.

CFOs who have been mandated to prepare for an upcoming IPO by their board need to have a talent plan to ensure they can meet their needs for going public and staying public. This plan for talent acquisition, development and retention is necessary to balance the costs of going public and staying public.

This talent planning business will not be easy. But those that start planning now will be at an advantage.

CFOs, get ready. You could be in for a very bumpy ride on the IPO Express.

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Filed Under: CFO Compensation, CFO Consulting, CPA Firm, Investor Relations, Investor Relations, Investors, Investors, Public Company, Risk Management, Risk Management

May 30, 2013 By Samuel Dergel Leave a Comment

VIDEO: Webinar Presentation – CFO Succession: The Right Way to Grow your Company’s next CFO

On May 23, 2013 I presented this Webinar on Proformative.

To get more information on this presentation, please view this blog.

Links referred to in this presentation:

    • CFO Moves
    • Blog: Why do CFOs Leave?
    • Blog: CFOs: Do you want to become a Controller? This CFO did just that.

If you have any questions on CFO Succession, please complete the form below and I will be pleased to get back to you.

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Filed Under: Assessment, Board, Board, Board, Board, Career Management, Career Management, CEO, CFO Coach, CFO Coach, CFO Coach, CFO Moves, CFO Moves, CFO Search, CFO Search, CFO Search, Executive Search, Executive Search, Executive Search, HR, HR, HR, HR, Human Resources, Human Resources, Human Resources, Human Resources, IPO, IPO, Successful CFO, Successful CFO, Successful CFO, Youtube

May 1, 2013 By Samuel Dergel 5 Comments

Webinar – May 23, 2013 | CFO Succession: The Right Way to Grow your Company’s next CFO

Join me on May 23, 2013 as I present a Webinar on the following topic:Webinar - CFO Succession

CFO Succession: The Right Way to Grow your Company’s next CFO

This session is graciously hosted by Proformative, and there is no charge for attending this seminar. To sign up, please click on this link.

Overview

Chief Financial Officers (CFOs) know that they will not stay in their current role with their current company forever. The CFO needs to ensure that his or her team has the right talent that can be called upon to replace them when they eventually leave the company (or the role of CFO). Strong CFOs also know that they are only as strong as the weakest leader on their team. This session will discuss the right way for the CFO to attract, retain and develop financial leadership talent for their team, while ensuring that they are setting the stage and preparing for their own eventual succession.

Learning Objectives

After attending this webinar you will be able to:

    • Understand why your success depends on having the best possible leadership talent in your finance team
    • Learn how to identify which areas to develop your finance leaders for future success
    • Become aware of the key components necessary to attract, retain and develop your company’s next CFO and other future finance leaders

CPE Credits are available for this session. For further information, please see details in the “CPE Info” tab on the sign up page.

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Filed Under: CFO Coaching, CFO Coaching, CFO Coaching, CFO Coaching, CFO Coaching, CFO Readiness Program, CFO Relationships, CFO Relationships, CFO Relationships, CFO Relationships, CFO Relationships, CFO Relationships, CFO Relationships, Controller, Executive Coaching, Executive Coaching, Executive Coaching, Executive Coaching, Executive Coaching, Executive Coaching, John Kogan, Leadership, On the Road to CFO, On the Road to CFO, Social Media, Social Media, Social Media, Social Media, The Strong CFO, Webinar

April 23, 2013 By Samuel Dergel 3 Comments

Quoted In: Why Strong CFOs Know Who Will Replace Them

Recently I was quoted in an article titled “Why Strong CFOs Know Who Will Replace Them” by Sarah Johnson on the Proformative Website.

Here are paragraphs where I was quoted.

“It’s not surprising a company like that has that kind of planning,” says Samuel Dergel, director, executive search, at Stanton Chase International. “Most companies do not.”

…

In fact, succession planning falls under CFOs’ risk management duties and their responsibility for business continuity, Dergel suggests. Just as CFOs have to ask “what if” questions about the viability of their company’s suppliers and credit risk, for example, they need to go through the possible scenarios for what would happen if they were incapacitated. “It’s the people who represent a company,” Dergel. “They are a key part, and if there’s instability in that, then the company is not stable.”

…

While talk about succession planning in the corporate world usually centers around the future of the CEO role, the CFO position deserves attention as well. “The CFO is an important figure in an organization. The more important they are, the more important it is to have a succession plan,” Dergel says.

At the very least, Dergel suggests, finance chiefs should – in addition to all their other duties – give the matter some thought.

To read the entire article, click here.

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Filed Under: Media, Proformative, Proformative, Proformative, Quoted, Sarah Johnson, Sarah Johnson, Succession Planning, Succession Planning, Succession Planning, Succession Planning, Succession Planning, Succession Planning, Succession Planning, Succession Planning, Talent Management, Talent Management, Talent Management, Talent Management, Talent Management, Talent Management, Talent Management, Talent Management

March 7, 2013 By Samuel Dergel 2 Comments

Podcast: Becoming a world-class CFO and Finance team: What it takes, why now, and who’s made it?

Listen to the Podcast here:

SAP_IXN-Program_Podcast-Artwork_2013

Download the Podcast file by clicking on this link.

This podcast is also available on iTunes.

Transcript for Episode 1 of the IXN Thought Leadership Podcast Series

Becoming a world-class CFO and Finance team: What it takes, why now, and who’s made it?

                              

Donna Papacosta: Welcome to the Intellectual Xchange Network Thought Leadership podcast, sponsored by SAP. I’m Donna Papacosta, your host for this podcast.

The Intellectual Xchange Network or IXN is a thought leaders network, by invitation only. IXN members are a select group of professionals, who through their research, writing and relationships are subject matter experts in their fields. As members of the IXN they provide insights, share ideas and help their readers and listeners become better informed on how they and their companies can improve. They are not paid nor are they spokespersons for SAP.

In these conversations, you’ll meet some of the members of the IXN, who will share ideas we hope you’ll find innovative and thought provoking.

This episode of the IXN Thought Leadership Podcast series was recorded February 22, 2013. Today we’re talking about becoming a world-class CFO and Finance team: What it takes, why now, and who’s made it? Our guests are Samuel Dergel, Mary Driscoll and Frank Ciannella.

Samuel Dergel works with Stanton Chase International, and specializes in CFO executive search. He is known as “The CFO Expert” and is a blogger and social media leader on the topic of the chief financial officer. Samuel is currently writing a book for CFOs called Guide to CFO Success: Leadership Strategies for Corporate Financial Professionals, to be published by John Wiley & Sons in 2014.

Mary Driscoll is Senior Research Fellow at the American Productivity & Quality Center. APQC is a Houston-based nonprofit that provides expertise on business process benchmarking and best practices for improving organizational performance. Formerly a senior editor at CFOmagazine, Mary is the author of Cash Management: Corporate Strategies for Profit, published by John Wiley & Sons.

Frank Ciannella is a Director in the Global Analytics Center of Excellence at SAP. He is a Certified Public Accountant and has extensive experience in SAP core financial and costing solutions, as well as planning, consolidation and profitability and analysis solutions. Before coming to SAP he was a senior auditor at a public accounting firm.

Donna Papacosta:           What inspired this discussion was a recent APQC survey, referred to in an Industry Week article entitled, “Finance: CFOs can become game-changers if given half a chance.” This, combined with Samuel’s post entitled, “CFO’s, can you afford not to have an excellent Finance function?” really merits a conversation with Mary and Samuel, as well as Frank from SAP, so we can explore this in more detail.

Let’s frame the discussion starting with this question: Based on your conversations with CFOs and Finance teams, what pressures are they facing today that could be preventing them from becoming a world-class department? Do you want to start with you, Mary?

Mary Driscoll:                  Sure. I think that’s a really interesting question because we’ve been studying for many years, what are the dynamics in Finance? To say that Finance has to become a better business partner may strike some as archaic. Certainly, I’ve been talking about that and writing about it for a long time, but in my research, what I find is that many organizations hit a wall on their way up the maturity curve.

When I look at our benchmarks and research, what strikes me is that easily 50% of companies are quite happy to tolerate their Finance operating costs that are two times or even three times more than necessary. Why is that? I think there’s been a long period of lack of willingness to invest in the people, processes and technology that would make Finance not only more efficient, but more effective. That’s really what business needs today; it needs Finance to help them be an analytical competitor.

Donna Papacosta:           Samuel, I’m sure you have an opinion on this.

Samuel Dergel:                 I think that the CFOs need to think of themselves as the CEO of their group. They need to run their Finance group like a business, realizing that they have to do customer service internally and be profitable. Another way of looking at is be cost-effective. To do that, they have to think of themselves as a business, they have to have a strategy for their Finance group, and they have to have a plan. Without these things, they cannot be successful.

Donna Papacosta:           Frank, what would you add to that?

Frank Ciannella:              I’d like to add a couple of comments around the pressures that CFOs face and my conversations with them. A lot around continuing regulation, whether it’s their home country, other countries, or just some of the regulatory authorities that are put onto the Finance organization. In addition to the changing workforce and what the incoming workforce is expecting from just an analytic and systems capability, the CFO also has to be concerned with deglobalization. It’s not just competing in your home country, it’s about competing globally and understanding who your competitors are. It also extends to the war for talent.

Much to Sam’s point, the CFO needs to be the general manager of the organization as Finance is looked at as a strategic business adviser throughout. I’d say another pressure that the CFOs face is internal. There’s a lot of system inadequacy, so too much of Finance time is being spent on data collection and gathering, and just not enough on high value-add activities. And as Finance supports the organization in the growth mode, they just can’t scale, and have often mentioned to me that that’s one of their major concerns and pressures they feel; just how do they support that growth mode of the organization?

Samuel Dergel:                 Frank, how many of them have a plan? How many of them really think it through and take the time to work to improve it from a 50,000-foot level, as opposed to trying put out fires on a regular basis?

Frank Ciannella:              That’s an excellent point. I’d say the majority of them do not have a plan or they have a plan that they just haven’t been able to execute on. That’s one of the things I like to talk to them about, is putting that plan in place and being very methodical about executing on that, because that’s the only way that Finance is going to help the organization pursue its growth opportunities.

Mary Driscoll:                  I have a comment on that too. In addition to a plan, I would argue that what really has to be in place is a strong and clear charter that ties the work of Finance to the enterprise mission. For instance, it’s easy to say, “We want to be a great Finance organization. We want to be really efficient and smart. We have metrics that show we’re doing more with less.” But what does that do for the organization? How is that helping the enterprise maximize return on capital? In the best-practice companies that I’ve had the pleasure of studying, it’s uncanny. You see that there’s a clear Finance charter and it includes language about the role of Finance in business decision support. These are not just mission statements that are hung on a wall and ignored; they are vital documents that inform the role of every single person in the organization.

Donna Papacosta:           I think you’ve all done a really great job of painting the picture of the current state, so maybe we could move toward some of the contributing factors that can help to create this really effective Finance function. I know you can all touch on talent, skills, processes, best practices, systems, tools, all that. I don’t know who wants to start there.

Mary Driscoll:                  I’d say if there’s a lack of commitment from the top, you can just about forget about it, because in order to make any traction at all, there will have to be investments in process and people. Take for example, the process of financial reporting. It’s scary to see how many organizations are still reliant on manual data entry, spreadsheets, and have just not stepped up to the plate and said, “We’ve got to automate this process and put in some workflow technology to take the risk out of this.” Why that is, it baffles me, but you’ve got a lot of very talented Finance people using age-old techniques and tools. It just doesn’t make any sense, given the risks of error. Sam?

Samuel Dergel:                 People are a key component, but it requires, from my perspective, three: People, process, technology. These three components need to be able to work together. On the people side, having the talent that you need is very important. The challenge is, and you bring it up, Mary, that many people within the organization are using ways that aren’t effective anymore, but where does that come from? The CFO is a leader of the Finance organization. The CFO needs a handful of strong lieutenants across the board. If they want to be able to deliver value to the rest of the organization, at the executive level in Finance, it can’t just be about the continuous monthly, quarterly, year cycle; that’s part of it, but in terms of delivery. But it really needs to be addressed as to how do you actually get there? If you don’t have visionary Finance people that can’t see where it can go and they’re just used to doing it because that’s what was always done, the CFO’s going to suffer and the organization is going to suffer.

Mary Driscoll:                  Sam, that’s right. If I just may jump in here; take the example of planning, budgeting, and forecasting. In this day and age when businesses are moving at the speed of lightning, it baffles me to think that companies are still relying on an annual budget as a primary performance management tool. That just doesn’t make any sense when it’s clear that to be resilient, businesses have to respond to fast-moving market changes. Finance, in order to be part of the solution, has to be able to refresh its forecast and help the company navigate or get back on track when it’s fallen off track using driver-based planning and techniques of that sort.

Samuel Dergel:                 From my perspective, from a talent perspective, it really is a question of having the leaders making it work and not just accepting the way it’s always been. It takes effort and it takes time, but without the leadership getting in control of that, it will just continue in a vicious circle.

Frank Ciannella:              I think that those are excellent points. I’ll even add something from a little bit different slant; maybe capitalize on what Mary mentioned. When I look at what can really help them become world class, I think of what capabilities do they have from a solution or systems and tools. What I find too many times is that what they have just isn’t easy to use; it’s not user friendly.

I think, if you look at from a Finance investment, it’s investing in capabilities that are very easy to use, very user friendly of course, easy to maintain, even from Finance. You don’t need to go back to an IT organization or elsewhere in the organization and wait for a month to get your capabilities met, because business is changing too fast. The ability to keep up with that, to go reforecast within a matter of hours or within the same day is critically important. So having these capabilities that are easy to use, very user friendly, very process-centric is really, really critical.

What I’m starting to see also is Finance organizations starting to gain much more interest in mobility; how can I enable my workforce, my Finance directors and VPs to work from anywhere at any time, having access to these systems and tools that make them most effective? I think of mobility capabilities, as well.

Donna Papacosta:           We’re tackling a big subject here I understand, but I’m wondering if you can share some examples that you’ve seen where Finance teams are evolving to this more efficient status and overcoming some of the challenges that you’ve been describing.

Mary Driscoll:                  Donna, I’ve got a good example. I was speaking with a CFO the other day who is working with his counterparts in Marketing and Product Development, and doing what he called “layering business intelligence over financial forecasting.” What that means is working with people in Product Development to understand customer behaviors and preferences, and begin to connect the dots between customer shopping behaviors and purchasing behaviors. With that, translating that information, or layering that information, over financial performance forecasts to make revenue forecasts more precise and help the organization as a whole better allocate its marketing dollars, for example, its Product Development dollars.

Donna Papacosta:           Samuel or Frank, can you think of an example that would help us to envision this future state?

Frank Ciannella:              I would like to add: Whenever I talk to CFOs, one of the first things that comes up and how they’re able to transform their organization, because I work a lot on the financial transformation side, is they really have to have to have the foundation done and essentially running on itself, almost like a factory. What I mean by foundation, it’s the core processes that plant owns, it’s the transactional processing, the general ledger, it’s account reconciliation. Having those processes, those transaction-heavy processes, order to cash for example, having them run, be efficient, be very repeatable, very accurate; and the CFOs have been engaging their own, lately, have been wanting to take that. I’ve seen some of them take that and say, “OK, our next step is we want to then take our close process and shrink it down to as little time as possible.”

So I worked with a large chemical manufacturer in the Midwest that had acquired another company, had their core foundational processes working very well, and I was able to combine, consolidate, and close over 1,700 different legal entities in a matter of hours. They’re looking at it very methodical: Let me focus on my close and consolidation process. Then for this particular company, the next on the roadmap is how do I make my budgeting plan forecasting much more agile, and how do I react much more quickly to changing market conditions?

The examples I’m seeing is really a step. I think sometimes we get enamored with trying to do everything and swallow it all at one time, and it just becomes more of a mess than a true example of world-class Finance. Those are the examples I always like to inject in situations like this, because I think they really speak to the fact that, A, it’s not easy; this is hard stuff, but B, there is a path and customers are blazing that path forward.

Samuel Dergel:                 There’s recent example I have with a CFO that I work with who was planning to improve the Finance function across the board. My perspective is from a talent perspective, and the CFO asked me to ensure that the leadership and the team had the talent that they needed to be able to move forward. It’s more than just, are they there and are they good people? It’s, can they meet the plan? Do they have the knowledge, skills and abilities to be able to make it work? It comes from the top. When a CFO looks at their talent pool and knows what they have and what they don’t have, that can allow them to make some very effective changes and get them to a world-class state. It has to start somewhere.

Mary Driscoll:                  Sam, I would add to that that the soft skills are increasingly being underscored by CFOs that are truly committed to continuous process improvement. We did a survey last fall that basically proved that when CFOs make a genuine commitment to raising the so-called “soft skills” – negotiation skills, critical thinking skills, presentation skills. When a commitment is made to those things as well as the nitty-gritty aspects of finance and accounting, when those commitments are true, the people in Finance increasingly are considered to be reliable business partners by folks on the operating side. They’re taken more seriously.

Samuel Dergel:                 What I do find, and it’s unfortunate, but in many cases in the Finance group, the way that you move from junior, to manager, to director, to VP is by being technical. That’s great to start off. Some people can have the ability to gain those skills if they’re trained. They may not have had the opportunity to get those skills; some aren’t. Unfortunately, too many Finance functions have senior leadership that don’t have the ability to grow in critical soft skill areas. That’s certainly a challenge for the CFO who needs their leadership to step up.

Donna Papacosta:           Right. Obviously, this is a situation where there are so many interconnected parts. I’m wondering if – we know that picking the right place to start is important in any kind of improvement initiative. Can each of you provide some advice briefly, as to what areas CFOs could focus on to improve their chances of success at this?

Mary Driscoll:                  What I do know is that the best-in-class Finance organizations that we find and document in case studies, 9 out of 10 times, you’ll hear them talk in terms of process methodology. You’ll hear them talk about Six Sigma, you’ll hear them talk about Kaizen, you’ll hear them talk about root cause analysis. It’s no coincidence that they get into the top-performance categories, whether it’s in cost efficiency or business partnering. It’s no coincidence that they also very much embrace that process excellence mindset.

Samuel Dergel:                 I agree that it’s a state of mind. If the CFO can get the Finance team to think about efficiency, effectiveness, customer service-oriented delivery, as Mary pointed out to me and I wrote on one of my blogs, efficient teams cost less. Spending money on talent ends up costing the CFO less. It’s proven, and it’s key. There has to be an effort to improve and make it work.

Frank Ciannella:              Yes, Sam, I think you’re 100% right, both you and Mary. Mary, you were talking about the process side of it. Sam, you mentioned earlier, and I completely agree; it’s people, process and technology working together. So where do you start? I think, first off, the mindset is a given; the leadership and driving from the top down is absolutely a given. A lot of things that I advise CFOs on, and I think we all do: What do you have today that you think you can do better? Thinking from a process standpoint, how can you become more efficient, more effective? What are those process improvements? Where can you leverage technology to make your organization a better business partner? Then once you’ve captured those points, going back to the first question we had; what is that roadmap? What is that plan to then start looking at newer capabilities and how you’re going to drive Finance to become that world-class organization so that you routinely are reducing your days sales outstanding? You’re reducing the amount of time spent on your reporting packages every month.

It’s this transformational journey, really, that needs to be put in place. I think there’s very easy places to start, which is just looking at what you have today already and what you can improve upon without a large investment. Then of course, make those improvements, and then put a clear roadmap in place to march forward. Usually, that does take some investment and commitment, but in becoming world-class, that’s what it’s all about.

Donna Papacosta:           Frank, that’s a great place to wrap this up, this conversation with you, Samuel, and Mary. I thank you so much for sharing your insights today. I think you’ve given people a lot to think about.

Mary Driscoll:                  This was fun. Thank you, Donna. Thanks ,everybody.

Samuel Dergel:                 Very much enjoyed it. Thank you.

Donna Papacosta:           Thanks to our guests for today: Samuel Dergel, Mary Driscoll and Frank Ciannella. Until next time, this is Donna Papacosta for the IXN Thought Leadership Podcast Series. Be sure to look for the podcast on iTunes.

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