My name is Emmalene Maxwell, and believe it or not I am here not just to talk to you about Star Wars, but to also talk of my experience in relation to the transformation of the finance function into something so much more than finance. If you could all just hum the star wars theme in your head for this next part that would be amazing, I thought walk on music was probably a bit too far for today…..
So just a bit about myself… In my earlier career I built experience in large corporations such as Amex and Loreal, and I learned to operate with best in class processes and procedures and really learned how the finance function could positively (or in some cases negatively) impact and support its business partners to achieve business goals. I was really lucky as the roles I had were varied and provided me with knowledge outside of the typical finance stream; from Investment Optimisation for over 15 international countries analysing and predicting investment returns, to Marketing Controller working closely with Marketing directors and General Managers to plan marketing spend and animations.
Then opportunity knocked, and I was offered a role at a start up cosmetics company that hadn’t even launched at that point. I joined as employee number 6, and Finance number 1. And that cosmetics company was Charlotte Tilbury, which grew to £100M in 4 years. This obviously gave me a tremendous amount of experience, not only within finance, but across the business – I took on, rather foolishly, lots of things outside of my comfort zone, like insurance, tax and legals, reporting to the board but also building and growing the whole finance function for the company from AP and AR to Financial control, from implementing budgets to a full FP & Function.
I am now the current CFO and Director of the Fold, a luxury women’s fashion brand for professional women. We’re seeing 80% Yoy Growth, we’re expanding internationally, and we have multiple marketing and sales channels. And I have a finance team of 2, and I’m one of them!
I was asked here today to talk of the subject of Finance transformation – so I had to think about what that actually means.
I started thinking about some of the challenges I have faced in performing my roles, and one of the key challenges that was a recurring theme in all my roles, both at large corporates and small start ups has been around financial planning and analysis, and how to keep a fast paced rapidly changing business on track to achieve its financial goals.
So I have to be honest…. The original title of this presentation was a little more 'financy’ , something along the lines of ‘how to hit a moving target’. But then I realised I was trying to hit a moving target, but the ground upon which that target was based and on which I was standing was also moving. Oh, and I was being shot at, by multiple things in the environment. And I had many people relying on my aim at the target, and letting them know what was going on. And a phrase I often use when talking about any start up company… I’m also trying to build the plane while flying the plane.
It felt a lot more dramatic than just a moving target, so I got to thinking about other scenarios in which this happens… and being a bit of a sci fi geek, the immediate one that came to mind was that of a Jedi Starfighter trying to destroy the deathstar, who is being shot at by an Imperial Fighter and giving minute by minute updates to rebel forces.
This was all a great idea when submitting my synopsis for my presentation…. And here I confess, I have had to rely on some other pop culture references to get me through…. although star wars gave me a lot of fun in the animation department…. Which I cant take credit for as I had a significant amount of help from our marketing manager, who thankfully is also a star wars fan.
So with the help of some star wars animation, and non star wars references, today im going to talk a little about the challenges I have faced, how it has impacted me and essentially, some things that I try to do to mitigate our ever changing world.
Okay…. So we are trying to hit the deathstar…… also known as, a budget! With the use of some handy film quotes, I am going to talk through some of those challenges I think we are probably all facing today…. and yes, they do get more and more tenuous as the presentation goes on!. Feel free to shout out if you recognize them.
Okay first quote is up….. Roads? Where we're going we don't need... roads! It was Doc from back to the future who said this. And sometimes I have felt like I have a budget in the distance, with no clear road to reach it. As soon as you sign it off, its no longer relevant and there is new information, and most of us don’t have the DeLorean to help us go back and forward and help steer a path. So in present time, If you try to budget too far ahead, things will change, and there is a challenge as to how we keep on the road to the budget. But just because things change doesn’t mean you can just write that budget off, you need that longer term view to ensure you have a solid idea of what you’re trying to achieve and how you are actually going to do that. If you don’t look out far enough, particularly in small companies, there becomes a risk to cash.
I’ll be back – I had to get this famous line in there somewhere as I am a massive fan of the terminator, but here – I’m actually referencing the man behind it, Arnie – who has reinvented himself completely a number of times – Body builder to Movie star, Movie star to Politician, Politician to TV Advert star… bit of a weird reinvention there I know. But you cant deny the man is versatile. Business have to be especially versatile these days, and continuously develop themselves. When I started my career, business development was normally something quite separate and independent of the day to day of the business fore example, a project to improve customer checkout experience or a ring fenced investment into a new channel or market. Now, business development happens constantly. That improvement to customer checkout experience is happening constantly. And these things are happening across the business. With the pace of change in technology, companies are seeing opportunities and quite rightly trying to take advantage before their competitors. Companies want to be a disruptor – but to be the disruptor you have to be ahead of the game. How in finance can we begin to budget for continuous business development – even if you have a general idea of the what that looks like at the beginning, by the time you get to it there will be something else new.
And this leads me onto my next quote…. Your Mission, should you choose to accept it, obviously from Mission Impossible and here loosely representing conflicting KPIs – poor Ethan Hunt, thinking he’s working for the IMF, but theres always a mole and he’s always disavowed – how does he keep on track and know what he’s fighting for? We have the same conflicting KPIs we need to manage – for example, Focusing on customer – its all about the end customer – they want it personalized and they want it now. And typically what does that mean for finance… margin erosion – as you add in ‘surprise and delight’ elements, improved experience at a higher cost for example, improved shipping options, for free!, ensuring your CS team are available when the customer needs them, adding customer service bots onto your site etc. But, I think we’d all agree, its too risky, and significantly more costly, to not do these things – reputational damage is instant, and viral. But how do we explain that to our investors as our fulfilment margin slowly gets eaten away…
And of course, there are many KPIs….I think it’s time to ask yourself; what do you believe in – and this was a quote from Indiana Jones the Last Crusade – and representing here, of course, Analysis Paralysis. With developing tech, in most cases we now have so much data – there is just too much to process. I have spent days working on analysis, verifying data points across multiple sources (which obviously never match!), having to make a call on which one to look at – then trying to glean some meaning from it in the context of all the other data points – and coming up empty handed with a wishy-washy explanation. How do you get to the crux of the matter – and coherently explain it to your board! And we all talk about the Holy Grail (see what I did there?!) of ‘one Version of The Truth’. In my experience, it’s a myth!
Another more external challenge we have to deal with, is regulation. The truth? You can’t handle the truth – from a few Good Men, and admittedly, a very loose reference to regulation (as in, it was filmed in a courtroom!) But regulation is a real challenge…. Its changing constantly and new regulations are being introduced at the speed of light – accounting standards, data protection, PSC register, CCO policies etc etc. How do finance teams keep up? And how do we ensure that there is time to fully digest, understand and roll out new policies – and ensure the rest of the business get it too?
And the final challenge…. Jack Bauer said it best when he said ‘Today is the longest day of my life’. And no, I’m not talking about the 60 hour weeks we all work….. But of course, geo-political uncertaintly, and boy did that man have to deal with some geo political uncertainty – as we do in finance! Of course I am talking about the B-word largely, but the B-word isn’t the only thing going on – customs tariffs and trade wars are being threatened, distance selling rule changes in the US for example – the goal posts are constantly moving. The goal posts wont even be on the playing field if we drop out of Europe with no deal….
So we have constant and fast paced change internally and externally, with more data than we know what to do with…. Practically, what does this mean for finance?
Its still just once a year isn’t it? A quote from Groundhog day – and the answer is no, its no just once a year anymore! We are doing more regular, more granular forecasting, which for me can often feel like groundhog day – we have to be reactive to changes in the market and the business, we need business cases 3 weeks ago for the project that marketing have just started spending money on, we have to update assumptions based on multiple data points…. We’re in danger of moving into continuous forecasting. And by doing this, we could be doing a lot of naval gazing, losing sight of some fundamental learnings, and not looking far enough ahead.
Sorry I have cheated here a little but, but there is no status quo – just because it worked last year, doesn’t mean it will next year. So how do you determine the viability of your investment? How can you build a growth plan you can hang your hat on, when you are moving into such uncertain territory.
And finally, Dorothy said it best when she said ‘We’re not in Knasas any more Toto’, and yes, I have edited a little bit for my purposes here. We are no longer just in Finance – you are ops, marketing, CS, ecomm, production, merch – you have to be fully integrated into every function to even have a chance to understand fully what is happening across the business.
These are just a few examples of what i’ve been dealing with in the last few years – there are so many more! I don’t have all the answers, but I do have some coping strategies…. To turn some of these challenges into opportunities.
So when you are trying to keep your aim on that deathstar……
You have to move with it!
Accept the moving target….
… and enjoy it.
Finance is the glue that can hold it altogether, be the guiding force to the death star and keep everyone focused on what is trying to be achieved. These are some of the things I have done to help keep our business on track….
And here I ran out of energy to find pop culture references, feel free to shout out if you can thinks of any good ones!
Communication I always try to Foster a collaborative way of working– There are often wider impacts of even one update or change to a project or business plan. You need to know whats happening, ideally before its happened! For this a collaborative spirit is essential – if people in the company already work like this, the flow of communication is natural. And the teams who are on the ground actually doing it – they know best! And you need that information to come your way. And don’t forget, it should be both ways – so finance are also feeding back what they are seeing. Also, make it positive communication – I have had experience where the finance team are the naysayers – unapproachable and inflexible. Why would anyone offer up key info if they are going to get their heads bitten off, or just a flat no. It needs to be a positive relationship. Now that’s not to say, you cant be the disappointed parent. If someone comes to me and tells me they are going to be over budget, they will get the disappointed eyebrow – but we will use our collaborative relationship to try and solve it. I’m glad I know about the overspend now as opposed to month end – I now have the opportunity to do something about it. In this way teams are empowered but also feel responsible.
And what are you communicating – is it the right information?
Information Proactive and reactive – we all use KPIs and dashboards to keep track and report, but we need to make sure these KPIs do actually then feedback into your forward looking view. Keep a live R&O scehdule – I’ve used R&O schedules in most of my roles. It means I have the right information to hand when the board comes knocking. In theory, it helps to avoid surprise later down the line. Future proofing – having been in a fast growing business, I know how easy it is for KPIs to become unmanageable because your systems cant cope. I try, and have succeeded in 50% of cases ! To streamline ahead of the curve. Think about what that might look like in 6 months, in a year, 2 years. We’re about to implement an ERP system at The Fold. Our current systems are fine – not super efficient, but they work. In a years time, I’m not going to have time for ‘not super efficient’ – and neither will the rest of the business.
Knowledge One more loose film reference at least, understanding the matrix - I know that if we introduce one shipping option, it has knock on effects across the company. Your communication has allowed the right information to flow – you now need the knowledge of your business to understand what to do with it. Our introduction of a shipping option impacts ecomm (enabling customer to use the shipping option), marketing (lets shout about it), logistics (does our 3PL know about this?!), Finance (margins and Ts&Cs). Don’t lose sight of the longer term goal, and constantly ask yourself – is what im doing right now contributing to that? Get involved – address your knowledge gap if an issue. Don’t let it slide by, it will come back to bite you in the butt!
Now how do you bring it all together…
Leadership None of these are new – but I still have to check that I am doing them consistently! Things slip when youre busy….
Lead by example – there is nothing more motivating than seeing your values in practice by your leader. Use your Insight – you have to be more than just the numbers and the money. What does it actually mean. Manage upwards – be open and honest. No BS. Get buy in – for big projects that is across functions, I need to make sure people have skin in the game (and make sure they know they do!). I will often use champions for elements of the project – give it to them, let them own it and drive it so they feel part of it, but not overwhelmed.
In short…. Don’t forget to Communicate clearly with rebel forces, review the deathstar blueprints thoroughly, Use the Force, and channel your inner Yoda!
Optional End Credits
Challenges for Finance
Roads?Where we're going we don't need roads!
I’ll be back…
Your mission, should you choose to accept it...
I think it’s time to ask yourself; what do you believe in?
The truth?You can’t handle the truth!
Today is the longest day of my life
What impacts on Finance?
It’s still just once a year isn’t it?
No Status Quo*
We’re not (just) in Kansas anymore,Toto.
*Oops, a music reference crept in
You can’t make the ground stop moving....
You can’t stop building the plane while flying the
You can’t stop letting everyone know this is all
Be proactive and reactive
Risk and Ops
Understanding of the matrix!
Step back and look at full picture
Lead by example
Get buy in