July 16, 2019
Finance Industry

What These New CFOs’ First Moves Tell Us About Financial Leadership in 2019

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A little over a year before it was announced that Allen Shim would become the first CFO of Slack, he sat down for an interview where he was asked about the challenges he faced as the then-up-and-coming business messenger’s new financial leader:

“Some of the issues I was dealing [were], do we have enough toilet paper? Do we have enough soda in the fridge? So, what’s the Instacart login?” he said. “After I dealt with that, on to the real problems.”

All joking aside, the finance function is evolving rapidly, and nowhere are the shifting priorities and demands of financial leadership clearer than in a financial leader’s first few months with a new company. During that crucial time, incoming financial leaders take stock of their new company’s operations and make the first steps toward bridging the gap between where the business is now and where it needs to be to remain competitive in the future.

For new finance leaders wondering where they should put their focus—and for finance professionals looking to understand what they need to do to get ahead in today’s financial ecosystem—tracking the early moves of prominent CFOs provides a useful template.

Taking the team from number-crunchers to decision-makers

When Zach Kirkhorn took over the top finance role at electric vehicle manufacturer Tesla in early 2019, there was one item at the top of his day-one to-do list: his team. The Tesla finance team had seen major shakeups in the months leading up to Kirkhorn taking over the CFO role. Kirkhorn knew that if he wanted his finance operation firing on all cylinders, he needed to fill those core positions ASAP.

Kirkhorn’s situation is one that any new financial leader will recognize. Team members are the heart and soul of any organization, and financial teams are no exception. As a new leader, the first task is to take stock of the talent they have and where the gaps might be.

In today’s rapidly evolving business environment, that task is made more challenging by the fact that the skills that teams needs to have to be successful are shifting. Consulting firm KPMG laid out some of the roles that are becoming increasingly essential in finance teams, including data modelers, business solutions architects, innovation and investment strategists, and business planning analysts.

In addition, with the increasing amount of finance automation tools at their disposal, new CFOs are focusing on adopting this technology and upskilling or hiring team members to leverage this technology to reach higher levels of strategic success.

Naresh Bansal, who took on the CFO job at AI auditing company AppZen in late 2018, had this to say in Forbes about how finance leaders can prepare their teams for the future:

“As innovations like artificial intelligence (AI) become more prevalent in finance, and in all functions, successful leaders will make sure their teams build a new skill set – meta-decision making. In the past, leaders emphasized employees’ skills and experience to give them the right answer. Today, they must emphasize the skills for how to find the right answer.”

In other words: the challenge for today’s financial teams is not to generate the information. It’s to understand the information once it's presented and know how to best leverage that information to help advance the business's goals.

For financial leaders, this means hiring strategically and investing in helping your team develop the meta-decision making skills they will need to navigate the transition into becoming more strategic financial professionals.

Evolving the role of finance within the organization

George Davis’s appointment as CFO of Intel in 2019 was something of a coup for the company. The chipmaker was long famous for promoting from within, but Davis was one of several outside hires the company made in a bid to revamp its operations for an increasingly competitive digital economy.

When Intel announced Davis’s appointment, they said that in addition to supervising the finance team, he would be overseeing the company’s IT operations as well.

Davis’s double-duty responsibilities reflect another wider trend in finance: the evolving role of finance professionals within their organizations. Gone are the days when finance teams were cut off from the rest of the organization, operating in their own financial bubble. Today, finance professionals are called in to consult on a wide range of business-critical issues that intersect with the organization as a whole.

This quote from a financial professional who recently made the leap from a Big 4 firm to a dedicated corporate finance team captures this evolution perfectly:

“I’m in the finance department, but really the finance department... handles everything that has to do with numbers. It’s not just accounting. It’s budgeting. It’s operations. If our technology team needs a new tool, the finance team is in charge of doing a cost-benefit analysis. Any analysis that has to do with numbers, finance is always involved.”

Furthermore, finance teams frequently must work across their organization to get the data they need. Folding requests for financial information into outside departments’ existing workflows—and aligning finance team objectives with those of other employees and the business as a whole—can empower finance and non-finance employees to work together towards a common goal.

For financial leaders, the implications here are clear: prepare yourself and your team members to be value-adders no matter where their expertise may be needed. And in an ever-evolving business environment, it will be needed in more and more places.

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Embracing automation as a path to strategic decision-making

John Murphy had not been in his new role as CFO of Adobe for long when he realized something wasn’t quite right about how his finance team was operating: in the midst of a period of rapid growth, the team was “drowning in work." As CFO, it was Murphy’s job to figure out how to fix it.

“We knew we couldn’t just add more bodies to solve the problem — it was time to use tech to re-architect our processes and build capacity,” Murphy wrote in an April 2019 post on the Adobe blog.

In his post, Murphy goes on to describe how he and his team leveraged automation to free up some much-needed time and energy for the team:

“We decided to deploy a number of bots—we think of them as digital employees—to handle the repetitive, mundane tasks our team was happy to offload. Our bots do things like retrieving invoices in response to customer email queries and helping users through the auto-renewal process. Then, our team takes over as needed.”

Automation is playing an increasingly central role in financial operations, as more and more tasks that used to require human intervention can now be managed just as well by machine. A recent McKinsey analysis found that 40% of finance functions can be fully automated, while just 19% would be difficult to automate.

The subject of automation can be a touchy one, particularly at a time when so much of the public discourse centers on whether “the robots are coming for our jobs.” Robynne Sisco, who took on the CFO role at Workday in 2016, offers this advice on how finance leaders can frame the integration of automation in a way that highlights the opportunity that it presents:

“CFOs should drive strategies that clearly communicate to team members that by automating administrative parts of their jobs, they will not eliminate their roles, but instead will be given new and more interesting work that will help them develop and stay challenged.”

Automation presents financial leaders with a powerful opportunity to liberate their human team members from tedious, rote work and to free their time and energy for the more creative, strategic thinking that only a human brain can do. Leaders should take a good look at their team’s processes and workflows and see where bottlenecks and team frustrations might be alleviated with more intuitive, automated processes.

Operating within a data democracy

The San Francisco-based company Workday specializes in financial management software for businesses. So it’s no surprise that, when they were looking to appoint a new CFO in 2016, they appointed someone who deeply appreciated the value that the right tools can bring to an organization: Robynne Sisco.

One area of particular interest to Sisco and the entire Workday team was the increasingly prominent role that data analytics is playing in financial management.

Since taking over the CFO role, Sisco has been outspoken about the benefits that enhanced insights from data have brought to her team:

“Our finance organization has been able to glean richer insights around metrics such as costs and profitability by bringing external data into the finance system of record. We can pull in external data, such as data center usage, that allows us to understand our profitability at a very granular level. By better understanding our numbers, we can better drive pricing decisions and determine what markets we want to enter.”

It’s not just Sisco. Data analytics is becoming a point of focus for a growing number of finance teams. As a 2018 McKinsey article headline memorably put it: “Get in front of digital finance — or get left back.” Financial leaders who want to stay competitive in this increasingly data-intensive environment need to invest in the tools that will allow them to do that.

Despite the increasingly crucial role that data analytics plays in a company’s financial success, surprisingly few businesses are taking advantage of the insights the technology has to offer. In a survey conducted by CFO Magazine, two-thirds of financial professionals said they are using AI in budgeting to do rolling financial forecasts; make improvements in cash flow; and for other finance tasks. Fifty-three percent are using software robots to close the books faster and conduct more accurate internal accounting and decision making.

A July 2018 article from consulting firm McKinsey sums up the challenge facing financial tools when it comes to the tools of the future:

“The CFO will… need to learn how to manage processes and communication within a “data democracy” — where business information is available anytime, anywhere, for everybody…. The CFO will need to work with the CEO and other business leaders to establish rules around data usage that reflect the specific information requirements of decision makers across the organization. They will also need to ensure that they are using the highest-quality data. Otherwise there will be analytical anarchy."

The lesson for financial leaders here is clear: Invest in tools that empower their team to participate in the “data democracy” by giving them access to the information they need, when they need it.

Guide your company into the future of financial leadership

The actions of the leaders of some of the top companies today provide a useful blueprint for where finance professionals should be putting their focus in 2019. Now, the only question is if they will take up the challenge.

Here’s where to start:

  1. Invest in people who are creative, strategic, and technologically-savvy—and are excited about the future of financial leadership.
  2. Invest in processes that embrace automation and empower team members to use their time where it counts: making an impact, not just in finance, but across the organization.
  3. Invest in tools that encourage your team to do their best work by providing them with all of the insights they need to make their best decisions in real time.


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