How To Help Your CFO Transform Finance

Successful transformation of a company or any function starts at the top. If senior management is not bought into the transformation then nothing will truly happen. Even if they are bought into it, they still need to convince the organization that it is the right thing to do. This is no different when it comes to finance transformation where the CFO, who is typically initiating the transformation project, first needs to convince the senior management team that this will be good for the company. That is if they actually care at all about what goes on in the finance function. If they don’t then at least the CFO knows the baseline is set pretty low. When senior management is taken care of in one way or the other it’s time to convince the finance function. This can be just as tough as convincing senior management as people’s jobs are at stake as well as a shift in power between the senior finance management team. From this, it’s clear that it takes the right kind of CFO or any C-suite executive to run a successful transformation project. Therefore, it is also important to look at where the CFOs of the world come from. 

They are all finance professionals or auditors 

Having looked at the CFOs at the top 25 companies of Fortune 500 it is clear that the majority of them have a background in auditing (8 of 25) and the classical finance disciplines such as financing, controlling or financial analysis (14 of 25) and actually only two of them have a background outside Finance. Only 7 of them have had stints outside of finance to gain some real business experience whereas not even a majority have been in disciplines close to the business. It can always be discussed what kind of exposure you get to the business from the various disciplines, but some are certainly closer than others and nothing beats real business experience. So how can we expect these finance executives to lead finance transformation projects that should bring finance closer to the business? How can we embark on a transformation journey when the leader brings no real examples to the table in terms of how great looks like? They can all use fancy metaphors like moving from the trunk of the car to the driver’s seat or bring in an army of consultants to make it all look very smart. However, what about real finance professionals adding real value to the company in collaboration with other frontline functions? The answer is that we can’t, but luckily here is where you come into the picture. 

How you can help your CFO transform Finance 

First of all, forget about making an immediate impact as either you would have done it already or you are not in a position to do it. Second, find a job where you can position yourself to help in the future and best of all if that position is in the frontline. You can make a much bigger impact if you work in Sales or Operations for some time and then come back to Finance. Third, once you have spent a few years in the business you can come back and start to connect the dots between Finance and the business. You have now seen how value is created and have made a lot of good connections with the frontline staff. This is an excellent starting point to tell your CFO that you know what great looks like. You can put yourself in the driver’s seat of your company’s finance transformation project. This should position you for a senior finance position following a successful completion and is a great background for being a disruptive CFO of the future as described in “Disruption And The 5 Types Of CFOs”. 

Transforming Finance is not easy, but in previous posts I have provided you with a framework for how to transform finance. I have described the necessity of each step in “Why Accountants Are An Endangered Species”, “How Finance Can Become An Analytical Powerhouse” and “What Finance Business Partnering Really Is” and now the time has come for you to play your part. Your CFO needs your help whether (s)he asks for it or not. Let’s transform your finance function together and let’s do it now! 

Where are you on your finance transformation journey? Have you managed to help the CFO getting the job done? Do you have other ideas or perspective on how to transform finance?

Sources Company websites, bloomberg.com & LinkedIn.com