CFO Study Findings:  Roadmap to becoming lean & strategic
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CFO Study Findings: Roadmap to becoming lean & strategic

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Multiple reports on CFOs have highlighted the need for CFOs to extend their management role from a basic accounting / reporting function to a strategic contributor to the business. While this is ...

Multiple reports on CFOs have highlighted the need for CFOs to extend their management role from a basic accounting / reporting function to a strategic contributor to the business. While this is widely acknowledged as a deep underlying force shaping CFO careers, the roadmap to strategic influence is not clear altogether. Our qualitative study concentrated on the latter point: how to bridge the transition points for CFOs from technical expertise to strategic influence.

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CFO Study Findings:  Roadmap to becoming lean & strategic CFO Study Findings: Roadmap to becoming lean & strategic Presentation Transcript

  • June 2011
    Confidential and Proprietary to DS&H
    DS&H CFO Study Report
    CFOs: Pathways to become lean & strategic
    … Seeing clearly ahead is now paramount
    André Du Sault, MBA (LBS), MPA (Harvard)
    www.dusaulthaddad.com
    1
  • June 2011
    Confidential and Proprietary to DS&H
    2
    DS&H
    www.dusaulthaddad.com
    Study framework
    INITIAL OBJECTIVES & KEY QUESTIONS
    In an environment of hyper competition, accelerated changes, how can CFOs build on their technical expertise to play a greater strategic role?
    What is the profile of the new CFO incarnation? What new capabilities CFOs need to
    develop or acquire? What is blocking them?
    3. What are the new expectations of the key stakeholders?
    METHODOLOGY
    We have interviewed about 50 senior executives from a broad range of perspectives:
    CEOs, CFOs, HROs, IT specialists, bankers, headhunters, administrators, etc.
    FOR WHOM
    CEOs, CFOs, VP Finance, Controllers, keen to build value added in the Finance function.
  • June 2011
    Confidential and Proprietary to DS&H
    3
    DS&H
    www.dusaulthaddad.com
    CFO study findings (6)
    Young CFO candidates are caught between two outlooks:
    . A narrow view of the job in smaller companies, with standard financial reports as the main output
    . A demanding role in larger companies, where CEOs increasingly require lean-minded & strategic CFOs
    CFO candidates are usually not schooled to be CFOs, leading to a poor blend of technical and strategic skills
    Key management and strategic skills are often integrated too late in the CFO career path to yield senior influence at the C-Level
    The job of Controller or young CFO stands at a pivotal point: What is integrated at that level (style, learnings, skills, responsibilities) shapes the potential for the CFO position.
    CFOs receive little or any coaching when handling high stake transactions that will make or break their reputation and credibility
    The pathway from CFO to COO/CEO is misunderstood and misapplied
    View slide
  • June 2011
    Confidential and Proprietary to DS&H
    4
    DS&H
    www.dusaulthaddad.com
    FROM FINANCIAL ACCOUNTING TO CO-PILOT
    There is increasing pressure on CFOs to perform under
    tight budgets & means
    an expanding scope of strategic responsibilities
    changing structures moulded by globalisation
    and the need to balance flexibility and efficiency.
    .
    Yet the roadmap for improvement and a new skills set is often unclear for many CFOs.
    View slide
  • June 2011
    5
    DS&H
    www.dusaulthaddad.com
    FROM FINANCIAL ACCOUNTING TO CO-PILOT
    In many competitive industries, stakeholders require a lean & strategic CFO as co-pilot for the enterprise
    Controller
    Co-pilot
    Lean
    TECHNICAL PRESSURES
    New accounting standards
    New business processes
    Complex Information technology
    Designing information architecture
    Facing budget limitations
    CEO
    Board
    Investors
    Bean counter
    Bankers
    Standard
    Functional
    Strategic
    STRATEGIC PRESSURES
    Leading business transformations
    Leading operational excellence
    Networked organisation
    Managing international ventures
    Outsourcing, off shoring
    Deal maker
    Confidential and Proprietary to DS&H
  • June 2011
    6
    DS&H
    www.dusaulthaddad.com
    FROM FINANCIAL ACCOUNTING TO COPILOT
    Young CFOs start off with technical tools to address technological challenges,
    but soon face a wide range of expectations from stakeholders to deliver strategic value
    master of cash flow
    business plan - strategy
    proper controls in place
    Investors
    transparency – integrity -controls
    financing strategy
    CEO – CFO relationship
    Board
    intelligent reports
    business acumen
    value driven
    CEO
    CFO
    master of cash flow
    finance skills
    business communication
    Bankers
    processes
    planning
    controls
    info
    IT
    clear policies
    information
    systems that work
    Employees
    Head-hunters
    team building
    leadership & people skills
    technical & strategic skills
    Confidential and Proprietary to DS&H
  • June 2011
    Confidential and Proprietary to DS&H
    7
    DS&H
    www.dusaulthaddad.com
    The roadmap from technical expertise to strategic CFO will include 3 stages :
    1. standard challenges for good basic performance in reporting & budgeting
    2. high stake initiatives that lead to senior roles and corporate influence
    3. continuous learning of technical, managerial and strategic skills
  • June 2011
    Confidential and Proprietary to DS&H
    8
    DS&H
    www.dusaulthaddad.com
    For instance, challenges for a good basic performance include:
    organizing reporting with high automation
    developing custom tools for finance & cash flow
    controlling internal planning and strategic tools
    capturing in-depth understanding of industry and operations
    managing international operations from a distance
  • June 2011
    Confidential and Proprietary to DS&H
    9
    DS&H
    www.dusaulthaddad.com
    High stake transactions shape reputation & credibility:
    overseeing complex IT projects
    driving corporate operational excellence programs
    leading strategic planning
    implementing mergers and acquisitions
    negotiating international ventures
  • June 2011
    Confidential and Proprietary to DS&H
    10
    DS&H
    www.dusaulthaddad.com
    Senior roles call for sharper people and strategic skills:
    reading people
    presenting for impact
    translating vision into action
    leading large value creation projects
    designing structure & organisation
    winning investors’ trust
  • June 2011
    Confidential and Proprietary to DS&H
    11
    DS&H
    www.dusaulthaddad.com
    Study participants indicated that poor career guidance may
    lead young CFOs & aspirants to make the following mistakes:
    not reading challenges well ahead
    choosing titles ahead of better mentoring
    relying solely on technical skills for influence
    letting ego build up a trap for a downfall
    having no plan B in their pocket
    losing passion of learning
    losing track of family
    Seeing clearly ahead shapes more productive careers
    * include controllers, VP finance, young CFOs...
  • June 2011
    Confidential and Proprietary to DS&H
    12
    BUILDING UP A ROADMAP FOR OUTSTANDING CFO SKILLS
  • June 2011
    Confidential and Proprietary to DS&H
    13
    DS&H
    www.dusaulthaddad.com
    BUILDING A ROADMAP FOR THE CFO: 5 LEVELS OF COMPETENCES
    The potential value added from the F&A function is wide and incremental:
    from basic financial statements to international fluency, to co-pilot.
    CEOs can plan to accelerate the CFO’s contribution.
    Strategic
    International
    Advanced
    Strategic planning
    Operational excellence
    Growth & M&A
    Company valuation
    Intermediary
    Global fluency
    Foreign exchange
    Partnerships
    Forecasts
    Financing strategy
    Investments
    Basic
    Value-added reports
    Budget planning
    Strong teams
    Standard accounts
    COGS
  • June 2011
    Confidential and Proprietary to DS&H
    14
    DS&H
    www.dusaulthaddad.com
    Early roadblocks are mostly technical, but shift rapidly to managerial and strategic.
    TYPICAL ROADBLOCKS
    DESIRED OUTCOMES
    LEVEL
    Co-pilot
    5
    Early mentoring of strategic skills
    Strategic influence
    International
    expert
    Experience in managing risk from a distance
    Global fluency
    4
    Advanced
    Adequate finance & cash flow training
    Finance strategies
    3
    Intermediate
    Integration of IT platform & accounting
    Building strong teams
    2
    Operational intelligence
    Basic
    1
    Mastering COGS
    Financial statements
  • June 2011
    Confidential and Proprietary to DS&H
    15
    DS&H
    www.dusaulthaddad.com
    On becoming lean & strategic
    CFO FOR THE 21ST CENTURY
    Conclusions
    Lean & strategic finance functions require a match between the CEO’s demand for
    high standards and the CFO’s technical and managerial capabilities.
    CFO candidates should balance their continuous professional development in a
    mix of technical, managerial and strategic skills.
    Coaching and training for young CFOs can greatly accelerate their potential.
    Skills development can be structured for quick pay-offs.
  • June 2011
    Confidential and Proprietary to DS&H
    16
    DS&H
    www.dusaulthaddad.com
    EXECUTIVE EXPERIENCE AS CFO:
    M. Du Sault has accumulated more than 20 years in corporate financial management:
    • Annual consolidated financial statements audited and sent to the head office on 10 January.
    • Having a budgeting and strategic process impeccably integrated to the information systems.
    • Preparing monthly executive reports limited to 10 pages, that speak loud and clear, with insights.
    • Managing international treasury (financing and hedging) programs, over and through financial crises.
    • Meticulous planning of M&A activities, with emphasis on integrating and capturing synergies.
    • Executing several corporate programs on Operational Excellence.
    • Outlining strategic guidelines for pension fund investments.
    MULTINATIONAL EXPERIENCE
    Novartis AG (Pharmaceuticals, Agro, Chemicals, Nutrition, Animal Health, Environment), Switzerland
    M. Du Sault was a head office delegate from 1987 to 1999, as CFO in a variety of country holdings, with revenues ranging from $US 15 M to $500 M.
    • Switzerland, Head Office:   Controller for Europe
    • Sweden - Auditor:  Internal audit program
    • Brazil - Controller:  Multiple financial crises, with hyper inflation (1000% p.a.)
    • Philippines - CFO & HR: Restructuring for growth
    • Spain – CFO:  Turnaround and best merger operation acknowledged within the Novartis group
    • Mexico – CFO:   Novartis merger, local economic crisis, M&A activities
    FINANCE FOR SME:
    Worked in a variety of industrial and technology sectors, from start-ups to mid-size companies.
    • Fund raising for private technology companies
    • Public fund raising for Capital Pool Companies
    • Restructuring of finance departments for higher productivity and coaching new CFOs
    • M&A activities for SMEs (USA-Canada).
    About the author
    André Du Sault
    MBA (LBS)
    MPA (Harvard)
  • June 2011
    Confidential and Proprietary to DS&H
    17
    DS&H
    www.dusaulthaddad.com
    DS&Hhas designed a series of programs for better CFOs
    On becoming lean & strategic
    CFO FOR THE 21ST CENTURY
    DS&H CFOTraining Programs
    For more information & insights
    from the study:
    André Du Sault
    514 777-1538
    adusault@dusaulthaddad.com
    FINANCE FOR small SME
    1.5-day
    Value added beyond accounting
    DevelopOutstanding CFOs
    3 days
    The foundation for senior roles
    The CFO as co-pilot
    0.5-day modules
    High level expertise & influence
  • On becoming lean & strategic
    CFO FOR THE 21ST CENTURY
    DS&H CFOIndividual Programs©
    For more information & proposals:
    André Du Sault
    514 777-1538
    adusault@dusaulthaddad.com
    June 2011
    18
    Confidential and Proprietary to DS&H
    1. Coaching the young CFO and aspirants
    Seeing clearly ahead
    Critical issues & smart choices
    2. Fixing and improving the F&A dept
    Before it all crumbles down
    Symptoms & remedies
    3. Mastering foreign exchange risks
    When doing business overseas
    A discipline & tool kits
  • June 2011
    Confidential and Proprietary to DS&H
    19
    DS&H
    www.dusaulthaddad.com
    On becoming lean & strategic
    CFO FOR THE 21ST CENTURY
    DS&H CFOConferences
    For more information & insights:
    André Du Sault
    514 777-1538
    adusault@dusaulthaddad.com
    International finance
    Mastering foreign exchange
    Successful international partnerships
    Doing business in Asia with no regrets
    From great ideas to breakthrough innovations
    Lifting strategy onto the board agenda