|Kit Williams, Founder and President, Compass Consulting, speaking at
The 2015 CFO Leadership Conference
The role of senior financial executives has expanded greatly in the past few years. In fact, in our opinion, there’s never been a better time to be a financial leader. While technical excellence is assumed, the new role of the CFO is now as a partner who runs the business, which requires a new decision-making process that balances multiple perspectives to achieve better performance.
It’s an exciting time. Excellent CFOs who have proven their leadership equals growth have thrown open the doors for the profession to get into the driver’s seat. However, there are still common derailments that can send these soaring finance executives onto the sidelines.
At our 2015 CFO Leadership Conference, we were pleased to welcome Kit Williams, President and Founder, Compass Consulting, to present “So You Think You Can Lead,” an interactive session that explored not only how our attendees can demonstrate leadership, by why they should lead in the first place.
Based on a series of 3 video presentations by CFOs, we heard about common challenges that face the office of the CFO, and how these particular examples solved the problem. We learned:
Relationships Trump Who’s Right
In this example, we heard from a CFO whose company invests capital and resources into the development of startups. At one point, the CFO and his finance team disagreed with the revenue recognition of a particular contract of one of their client companies. And while the CFO felt one way, the client company was getting contradictory advice from their audit firm.
In this instance, it’s a case of leadership without authority. Understanding that the relationship was more vital than who was right, the CFO decided to make their recommendation known, but allow the company to proceed with the auditor’s recommendation if they choose to do so.
Ultimately, the company did proceed with the auditors recommendation, and thankfully the relationship between the two companies remained intact. In fact, when the CEO of the client company sold the company and started a new venture, the investment company infused money and resources.
Lesson learned – sometimes the relationship is more important than who is right. Choose how you use your influence wisely, and be mindful of the difference between leading and ordering.
Get The Right People In The Right Roles
In another example, we reviewed the case of a newly-appointed global CFO tasked with major growth goals over the course of a few short years. In her toolkit sat several longtime divisional CFOs, each of whom were talented in their own right, but might not have had the talents she needed to meet her goals.
Her leadership decision – wait to see if she could develop her existing talent naturally, or move quickly to replace the team with new talent that would have to onboard quickly.
She moved quickly on two fronts – she offered mentorship opportunities for the existing talent she believed could be great leaders, and removed the talent she knew who would not make the transition. For those she offered mentorship to, she did so under the belief to respect the history and knowledge of the retained talent, and to offer them the opportunity to grow. For the talent she removed, she offered them a long runway to look for their next position, out of respect for their tenure and history with the company.
Ultimately, her decisions were the right ones – she has met and exceeded her growth goals, and the company is tracking well toward continued success.
Lesson Learned: Getting the right people on your team is critical to your success. Be fair and thoughtful in your approach, and be sure to show respect to the talent that’s there.
Closing The Gap In Financial Education
In our last example, we examined the challenge of teaching finance to non-financial managers. As finance is the common language among all business units, it’s imperative that CFOs extend their influence to help their employees understand the meaning of the numbers, and how they can use that understanding to help move business forward.
A few pieces of advice shared include:
- Don’t underestimate the level of fear and lack of confidence about financial skills
- Make time to be with your employee over time to work through their education
- Take the stress out of the numbers by making the setting a competitive and fun one
Lesson Learned: Leadership starts first by ensuring that your constituents understand the language of your message. Take the time with your non-financial managers to teach them the basics and strengthen their confidence in your language.
In summary, be thoughtful, reach out, and be decisive in your ultimate actions. The true measure of a leader is in the success of the people around them. Growth in numbers almost always follows immediately behind.
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