The pressure on finance leaders to become more involved in driving the commercial activities of their organizations has been much discussed, including on this site. The need for them to take a more strategic position has seen many essentially become a CEO-lite. In the past their primary focus was book keeping, reporting, and forecasting. Those in the finance function were, as a result, often stereotyped as number crunchers with little to offer creatively. They are still expected to perform these tasks, at least those that have not been automated, but they are now also expected to help improve the business in other areas - make investment decisions, assess potential new markets, oversee mergers and acquisitions, and so forth. But have perceptions changed, or does the stereotype around what a CFO ‘should be’ persists? And is this holding them back?
In KPMG’s View from the Top report, 30% of global CEOs who responded said that their CFOs don’t understand or assist them enough with the challenges they face in running their organizations, while less than half of CEOs believe their finance functions are doing a good job in exploring and implementing the best new technology. Is this because they still see them only as bean counters? Are they not being allowed to do their job because perception has yet to catch up with reality?
We asked 10 finance leaders from some of the world's biggest organizations whether they feel executives' perceptions of their role as accountants still prevents them taking up a role as a strategic partner in their organizations, and what can be done to change their image.
Don Janezic, CFO at Bigelow Tea
Perception is still not good in some instances. However, in those companies where the CFO has exhibited progressive and dynamic attention to strategic matters both for the company as a whole and between relationships with other C-suite partners, the perception is changing. It really depends on how CFOs are prepared to conduct their actions. Reality creates perception, perception is reality.
Step out of the box!
Cristina Tate, Senior Finance Director, HPE Software FP&A at Hewlett Packard Enterprise
It definitely can. You still hear Finance folks referred to as 'bean-counters' and 'number-crunchers' occasionally. However, it is incumbent upon us as Finance leaders to contribute beyond the numbers and make sure it is understood that we offer so much more in terms of analysis and insight. Don’t only weigh in on financial questions. If you have an opinion on an issue being discussed, share it.
Matt Carpenter, CFO at Audi
Although different from my own personal experience, I can see how some finance stereotypes may still exist. The philosophy at Audi of America is that the entire team owns our strategy; everyone contributes and everyone is accountable. To maintain this collaborative culture, it is critical that all functions, including finance, demonstrate a healthy balance between traditional thinking (i.e. how things have always been done) and new ideas (i.e. what needs to be changed to secure our future.) Finance can be typecast within some organizations as overly risk-averse and unwilling to change, but these are habits that need to be broken to earn the creditability of our business partners. Be open minded and willing to compromise!
Michael Kaplan, Former VP of Finance at Activision
Executives’ perceptions of finance leaders I have worked with vary, but most expected me to be both their strategic partner as well as the driver of the accounting function of the organization.
When I have been in the situation where the executive sees only the accountant, I have inserted myself into the organization as deep as possible to learn about the business. This included going on account calls, visiting vendors, or acting as a thought partner. By doing this, I gained the ability to ask the right questions and add value not just on the accounting side, but also as a strategic partner, or when necessary as a business operator.
Jesse Y Yao, Former CFO of the Sauces and Frozen Business Unit at Kraft Heinz
Absolutely. In addition to perception, there is sometimes also a real skill gap. Depending on the situation, leaders must keep an open mind for all the potential options that may help them reach their vision for the company.
James Butler, Financial Controller at Surf Air
In my experience, executives’ initial perception of any finance professional is still as a back office accounting function. However, if you position yourself as a strategic partner and build a strong relationship then over a short period of time you will be a key strategic partner in the business. I’ve worked in organisations where everyone in finance is treated as a business partner and are embedded right into the organisation, to companies where finance is predominantly a back office function but the common theme is that it is your approach as a finance professional and not the organisation that will dictate your role. You cannot argue the value that a strategically minded finance professional brings to an organisation so the opportunity will always be there.
Aakif H. Khan, CFO of Gulf Union Foods
It varies from company to company…sometimes in my part of the world in traditional family based businesses or private companies this perception still prevails …but even the successful family based business have changed their way of thinking and consider CFO as a strategic business partner.
In cases where it exists, the CFO himself/herself can play an important role by stepping up his efforts to demonstrate his/her ability to become a strategic partner. A good grasp of business dynamics and its environment, reflection, and fact finding will lead to a point where one can stand on one’s own two feet and give a balanced opinion on how to move forward.
Zekeriya Bildik, Industrial Controller of Ferrero
Today’s global world and competitive market do not permit companies that see finance leaders as just accountants to survive. The global market has become flatter and it is becoming more volatile. It means that companies have fewer opportunities to find sources to get competitive advantage and there will be new crises ahead. Increasingly, the quality of decision making will become the discriminator of business success. At this point, Finance Leader is the key person for supporting strategic decision making process. I think organizations are aware of that and on the way of adopting finance leaders as strategic business partners day by day.
Laura Hazlett, CFO, California College of the Arts
I believe the best executives have realized the value of financial leaders who think more broadly and are engaged stakeholders with all parts of the organization. Despite this, there remains some historical thinking which results in some CFOs being pigeon-holed into their role as simply finance experts when they have the ability to provide significant incremental value and to inform decision making across the organization. The best CFOs are able to demonstrate their commitment to the mission and values of an organization, and not just the numbers.
Nick Fischer, CFO of Betteridge
I think in some organizations this is true, but perceptions can be changed. It starts with a focus on building credibility as a flawless operator of the finance & accounting function, and then leveraging that credibility to build a strategic voice.