small change: your CFO, or you

CiaranLinkedIn
small change
by
Ciarán Fenton
How small changes in your behaviour have a big impact on how you work, lead or follow
That’s the working title of a book I’m writing, initially as a series of short blogs.

Blog 2 small change: your career is a unique business

Blog 3 small change: your soft balance sheet

Blog 4 small change: your D Liability

Blog 5 small change: your timeline

Blog 6 small change: your formative years

Blog 7 small change: your A asset

Blog 8 small change: your career equity

Blog 9 small change: your curriculum vitae

Blog 10 small change: your emotional intelligence

Blog 11 small change: your reputation

Blog 12 small change: you, three years from now

Blog 13 small change: your purpose, strategy & behaviour (PSB)

Blog 14 small change: your soft p&l

Blog 15 small change: your 7 career options

Blog 16 small change: your relationship grid

Blog 17 small change: you are not a human capital asset

Blog 18 small change: your 7-step job search plan

Blog 19 small change: your 3-step interview plan (1)

Blog 20 small change: your 3-step interview plan (2)

Blog 21 small change: your 3-step interview plan (3)

Blog 22 small change: your job search funnel

Blog 23 small change: your reactive job search

Blog 24 small change: your proactive job search

Blog 25 small change: your first 100 days

Blog 26 small change: your operating board

Blog 27 small change: your main board

Blog 28 small change: your CEO, or you

Blog 29 small change: your CFO, or you

small change

Seven principles

Principle 4

A shared Organisation PSB

  • shared purpose,
  • strategy
  • and behaviour in your organisation
  • is key to its success

 

Blog 29  small change: your CFO, or you

you as cfo main board copy

you as cfo ops board

Your CFO is the chief financial officer in your organisation.

“Chief” means that they outrank everyone else when it comes to “the numbers”.

Every number.

They are responsible for signing off budgets, accounts and they control cash.

In addition, they have a key strategic role: they must confirm, or not, whether the agreed strategy stacks, financially. No one else can or should make that call.

I have a soft spot for CFOs. I was “cajoled” into a cost and management accounting traineeship after university and hated every minute of it, initially. Begrudgingly, I made peace with it by the age of 29 by which stage  I was a Financial Controller before moving into my first divisional managing director role.

I will never forget the evenings, the all-nighters, and week-ends in my twenties spent doing budgets, reconciling accounts and preparing “the monthly pack” fort the board: Balance Sheet, P&L and Notes.

I will also never forget my first bank reconciliation, the first of hundreds of “bank recs” I did,  and what happened when I presented it proudly to my boss. “Does it balance” he – for t’was a he – asked. “Yes” says I. “No, it doesn’t” said he. “Well it’s only a few quid out” says I. “Well, a few quid could be the net of umpteen debit or credit entry errors either way – including one just a few quid short of £1m. Couldn’t it?” says he. “Do it again!”.

I did. He was right. There were loads of posting errors – some huge. And they did net out to  “a few quid”.

An appreciation of the power, beauty and elegance of the double-entry accounting system has never left me since. My training and experiences as an accountant in those early years still come in useful in my work with leaders and boards.

CFOs know, inter alia, three important things:

  • There are no shortcuts in accounting. It will take as long as it takes.
  • Numbers which are “buried” will, almost certainly, “rise again”.
  • A provision is a thing of grandeur.

CFOs can also have serious blind-spots:

  • Since they are usually inexperienced in other functions especially sales, marketing, and IT,  they sometimes fail to listen to people who do know what they are talking about, leading to painful re-forecasting at best and serious business injury at worst. Once, when I led a division, I put in a marketing budget of x leading to sales of y. The CFO “persuaded” me to put my name to a marketing budget of z (significantly less than x) but with original sales target y. Inevitably, at every management meeting, there were “brackets around” my name and the CEO would use the dreaded “D-word”: “Ciaran’s variance this month is disappointing, again…”.
  • Some are not good leaders. They don’t lead their teams well and don’t value the art and science of leadership.
  • Others who are good leaders, and later become CEOs, don’t understand that they can’t cherrypick the aspects of the CEO role that they like best. Some struggle and retreat into their beloved spreadsheets and don’t allow their successor CFOs to do their jobs resulting in a weak CEO and weak CFO. A killer combination.

 

Does any of the above chime?

 

Ciarán Fenton

 

 

 

 

 

 

 

 

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