Lessons From Leaders - Chief Financial Officer
In the spirit of strict anonymity, names and all identifying information have been removed from the below article. To learn more about Fintros - the leading anonymous opportunity platform for finance leaders - please visit www.fintros.com/faq.
Fintros: As CFO at one of Canada’s largest NFP’s, can you describe your daily focus?
Anonymous CFO: For me, every day revolves around executing the business plan for the organization. So, a good part of my day is trying to understand what performance has looked like for the past six months, and based on what performance has been, what can we project the budget to be for the next year. At this point in time, the plan and the budget is the thing I spend the most amount of time on, as they are inextricably tied. It’s a combination of examining the first six months of the year, and then projecting what might take place in the third and fourth quarter. While no two days are the same, as CFO my daily focus remain the same; I’ll routinely spend a fair bit of time looking at the actual results, talking with business leaders as to how they’re feeling about their results; whether or not they think revenues are going to maintain the current levels, and whether they can beat budget. Additionally, I spend a lot of time thinking about, if there was something we had to take out of the budget; if there was something that we had to reduce spending on - what are the things we could do; how could we manage to make this year’s results; and then how can we build on this year’s results to meet next years’ plan.
Fintros: You were previously CFO of a leading Canadian financial corporation. Can you quickly summarize the difference in the pressure to execute on the business plan between corporate and non-for-profit financial organizations?
Anonymous CFO: Corporate is much more intense. But, the NFP has its own level of intensity; you’re driven because you’re constantly trying to do more with less. In the last five years, the NFP world has suffered; donations are down, government funding is down, yet there is more and more need. So, the pressure is different. It’s not so much a work pressure, but rather a pressure to accomplish something.
Fintros: People and programs ultimately take priority over profits?
Anonymous CFO: Right. In the corporate world, you’re conscious of shareholders, as you are conscious of your boss, Sr. management, and your team. You’re very much focused on the business and doing whatever you can to improve the bottom line. On the other hand, the NFP world is essentially driven by what people refer to as the mission; curing cancer, eliminating heart attacks, etc. So for the person who works at an NFP, their real driver is that goal. They aren’t showing up to work with the interest of banking $300M dollars more in revenue, but rather using the people and resources available to them to contribute to finding a solution to a much more complex problem. So - it’s a different kind of intensity. I think a lot of leaders from corporate institutions come into the NFP world and they don’t recognize the difference in culture; the difference in how you need to manage and behave, because in a profit world you’ve got all the more leverage; you can push a staff; you can tell them that you’ve got to have something done by 8 o’clock tonight, and most people will be there at 8. It would be unadvisable to manage in that fashion in the NFP world.
Fintros: You mentioned culture. Do you think there is a middle-ground to be found in promoting a great cultural environment at a corporation while chasing profits?
Anonymous CFO: In my experience, I’ve dealt with a number of cultures, and I’ve also witnessed a culture shift/change in an organization, and I do believe you can in a corporate world have a culture that makes people want to work there, and actually encourages productivity and employee engagement, and in turn the success of the corporation. Moreover, I think that senior management is especially critical in defining that culture and what they expect of their teams and the people who work there. I’ve seen CEO’s who’ve had a great ability to bring people together, giving them a single vision and view of what the organization is all about and what they’re trying to accomplish, and very successfully make it a culture where people want to stay and like to work, as well as a culture where people will do that extra thing for the company because they have bought in to the vision. However, I’ve also seen cultures where the leadership is so toxic that all they want to do is beat down on their staff and get stuff done without recognizing that their success is contingent on nurturing and cultivating a culture where their staff will be successful. If I was going back into the corporate world, the culture of an organization would likely be the first thing that I assess, as it is critical to me, and I would suggest to anyone looking to make a career transition, that they feel out whether or not they are comfortable with the culture of the organization, because at the end of the day you’re not going to be happy with your role, or your job - even if they pay you a lot of money - if you don’t agree with the culture, or you don’t feel the place is going in the right direction. Again, great culture takes form when everyone buys into the company vision.
Fintros: What advice would you offer to young finance professionals looking to best position themselves for success?
Anonymous CFO: I think the one mistake most people make in their career, whether they are in accounting, higher-level finance, marketing, or whatever focus, is the common tendency to believe that operating within that function is the only way to contribute value to the firm. I’ll use accountants as an example because that’s where I grew up. There’s a way that accountants can interact with the business; they can sit back and do the numbers every month and send people reports, and basically have this passive role but do everything they're supposed to do based on the CICA handbook but not add any additional value to an organization.
One of my most successful traits is that I got involved in non-finance tasks to really understand the organization. In my first life, I spent about a decade in retail, where believe it or not I told my accounting staff to go to one of our stores and just listen to customers. I told them to listen to what customers are asking and to find out more about the critical pieces that really drive the business. The reason I do this is because in my formative years I had a boss who, when I was moving up in the organization, told me the reason he promoted me was that he viewed me as being bilingual. What he meant by bilingual wasn’t my ability to speak both English and French, but that I was a very good accountant and that I really understood the retail day-to-day business and it's drivers. It takes very little effort and it can really change your career trajectory. I attribute much of my career success to the simple things - like going into our stores and talking to the retail staff to further my understanding of the business and to then take that knowledge and create processes that influence our employees at every level and generate better value for our customers. In short, if your readers are to remember anything from this piece, it is to reach out and find ways to help across the organization and build relationships with different departments - even when you are not explicitly told. Start today!