When I was interviewing for my first CFO role, I had the honor of interviewing with the retired CFO of a Fortune 10 company. I was incredibly nervous and felt so very out of my element – how could I ever stack up to his expectations of a CFO? I ended up getting the job and worked closely with him for several years, almost completely forgetting the anxiety of that first meeting.
One thing I did not forget, however, was his answer to my question: What makes a good CFO? This guy was responsible for the financial health of a major (very successful!) global corporation so if anyone could answer this question, he could. He said:
A good CFO helps the organization see around the corner. This has stuck with me for years. Every time I’m involved in any type of strategic conversation, I imagine myself peering around that metaphorical corner, striving to plan for what’s ahead. Now, I’m no psychic. I don’t have supernatural powers to help me see the future (although, sometimes I think that would be nice – that’s why they say hindsight is 20/20, I suppose). But there are a few practices that can help CFOs lead their organization by seeing around the corner:
Stay Connected. At nonprofits, we wear a lot of hats which can mean CFOs are also doing bookkeeping, HR and IT, plus trying to stay on top of the financials. It can feel nearly impossible to think strategically while you’re completely immersed in the daily operations of the finance department. But to see around the corner, you must stay connected to all parts of the agency. Have lunch with the program staff, meet the development director for a quick update on the annual campaign, go visit a program site and connect with your clients. Staying connected to everyone your organization touches will help you see the big picture of where you are and where you’re going.
Use Your Numbers. We prepare the income statement and balance sheet each month, we explain variances and make adjustments but we’re often only comparing budget to actual, or last year to this year. Two points of comparison don’t often tell a rich enough story. Use your numbers to dig deeper, create 5-year historical analyses and forecast beyond next month. Set aside time on your calendar after each month-end close to dig deep into those Excel spreadsheets and play with your data and I promise you will see farther around that corner than you ever have before.
Be Open to Change. Especially for agencies that have been around for a decade or two, we tend to fall into the same practices, procedures and programs that we’ve always done. When we ask a staffer why we’re doing it that way, they will probably shrug and say, that’s how we’ve always done it. To see around the corner, we have to open our minds to new possibilities. Maybe we need to close an unsuccessful program – take a step back – in order to free up resources to expand another program threefold – take two steps forward. A traditional CFO may try and reallocate resources to make the unsuccessful program better but a seeing-around-the-corner CFO is open to change and can see the bigger picture.
What do you think? How do you see around the corner?Organizations still need help seeing around the corner?