9 minute read
Stakeholder wealth
The power of leadership with a human touch can drive profits and sustainability.
BY PUSELETSO MOMPEI
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Under the session titled, ‘Embracing the soft skills finance now needs’, finance leaders spoke about the value they have garnered by growing their own soft skills. Oz Desai, GM of the session’s sponsor, Corporate Traveller, said that in his business, people are a major catalyst to organisational success. He shared that the impact of
Covid-19 has been brutal on the travel industry, and he has found that navigating the challenges by employing soft skills such as empathy, care and fairness had been critical.
Oz said that all leaders want to succeed and grow – and need people in order to do so. As a leader, he believes that growing and investing in people is an enabler, as is having the right values, vision, and culture.
He said the future lies in embracing technology while at the same time harnessing the greatness of people. Mark Gounder, Hulamin CFO, agreed with Oz and said that people tend to put the highest value on an organisation’s physical assets, but those don’t drive profits and sustainability, it’s the people who do. He said that especially now, we need strong leadership to stand up with a clear plan to create value and be brave enough to lead on the path to get there.
Unique risks
MARS SA CFO Sam Hopwood said that in the last year and a half, the context has changed rapidly for CFOs: there is a lot more ambiguity, a quicker rate of change and they have had to prioritise without the robustness of information from the past. “We have the responsibility to build the bigger picture for the entire organisation, so we need to be more strategic in thinking and robust in problem solving,” he said. Eddie Fivaz, the FD of TWK Agri, said that for most finance leaders, leveraging soft skills has been difficult because that’s not an area that comes naturally for accountants. He said that the Covid-19 pandemic kicked up a lot of fear and uncertainty, which left leaders no choice but to respond. He noted when there is unaddressed fear, people lose focus, make bad decisions and in the long run, you risk losing the stars of your organisation. He says the Covid-19 crisis has posed its own unique risks because in the remote working environment, if a team is hopeful and digitally connected it is powerful, but if it is hopeless and digitally connected, it can be dangerous. Sam said that as professionals get higher up in an organisation, they spend less time on finance-related matters and are brought in to address matters such as organisational development, career development, and policy review, and tackle issues such as how the office of the future will function.
He says being a CFO is not just about being a functional head, but being a leader in the organisation broadly and in that context, leadership capabilities and behavioural competencies become more important. Mark said that as a leader you are expected to have a clear plan and strategy to grow business. He says previously, the value of the CFO was measured around profit, now it’s about stakeholder wealth.
“The pandemic has taught us that if you don’t have win-win relationships with suppliers and debtors, one of you will go out of business, and that is where CFOs with interpersonal skills and leadership make a difference; when you have to navigate complex situations,” he said. Mark added that leaders have a responsibility to help their teams develop and become more resilient as well. He said that leaders with EQ allow people to learn from mistakes and have the self-restraint to not meddle in how people do their jobs, because that is part of empowerment. He said that creating an environment of trust means giving people room to make mistakes, and letting them learn from fixing those mistakes.
For Eddie, it was crucial to maintain a well-connected team through the disruption of the
Mark Gounder Sam Hopwood
past months. He said that as a leader, he made it a point to maintain and spread positive energy throughout the team.
EQ and vulnerability
He said that with working remotely, the risk of losing team spirit and not transferring knowledge was real. So he started a programme whereby all team members read a book every month and through informal discussion, they shared what they learnt from the book, which provided a great way to connect and learn. In addition, he wanted to make sure the team does not lose sight of their ‘why’ and provided clarity on decisions being taken, consistently giving feedback and updates to the team. He believes that a combination of leaning into soft skills such as constantly checking in, taking the pulse of the team and having a strong strategy resulted in the company being able to grow and increase profits, despite the economic downturn.
Mark said being vulnerable is challenging because you are expected to make hard decisions, but by being upfront and sharing that you are also learning every day, you create a sense of togetherness and the joint goal of creating value in business as a collective. He said leaders need to be brave enough to offer guidance and be humble enough to ask for feedback.
Sam and Oz emphasised that being a leader who listens is vital. Sam said this trait applied throughout the organisation: “Having curiosity, and being eager to learn gives an organisation an edge. If you become open and embrace feedback and drop being defensive, it’s a game changer.” Mark agreed and advised future leaders to “listen to people, to learn from other’s experiences and believe that you can continuously work on your EQ”. “It will take you far,” he said.
The value of digital transformation
Covid-19 and the disruptions that came out of the pandemic have forced organisations to act on and accelerate their digital transformation strategies, catapulting CFOs to the digital and data-centric leaders of the business.
BY PUSELETSO MOMPEI
Fred Portal, Workday’s OCFO Solution Marketing Director for Financials, says pre-pandemic, some organisations felt there wasn’t enough time and money to transform, and those who resisted were on the backfoot as crisis ensued.
Fred’s view is that finance transformation is no longer a choice because organisations that hold back won’t be able to withstand the requirements of the digital marketplace or maintain a competitive edge.
The constraints of operating businesses during the pandemic caused many to change tactics and pivot to utilising technology to stay in business. The impact was that accounting structures had to change and for CFOs, that entailed calculating costs and profit differently while figuring out where the smartest, most lucrative investments lie. Making these decisions is very difficult when your system is not agile.
Fred says the value of digital transformation became clear when organisations that were already on the journey at the onset of the Covid-19 crisis demonstrated the benefits of being more agile. Transformed organisations saw a drop in processing costs and had healthier margins than non-digital competitors, and Fred says this is why finance transformation is now a must-have.
“Today’s environment demands a shift from finance leaders as gatekeepers to business partners.” - Fred Portal, OCFO Solution Marketing director, Workday
Fred Portal
Strategic imperative of steering through a crisis
The pandemic forced finance leaders to put more robust plans in place as their organisations tried to navigate an uncertain future. As organisations rushed to replan and reforecast in the new environment, the pressure on finance to deliver more analysis and insight became heavier, and finance’s ability to generate data across the organization from HR, sales and operation, and turn it into intelligence the enterprise can use to make strategic decisions became of immensely valuable.
To be a full business partner, finance has to be able to automate processes and deploy cloud solutions so that their company can process increasing volumes of data with optimal efficiency. Taking on this added function will require a mindset shift from predominantly dealing with core accounting, to moving to a co-piloting role and guiding the C-suite on digital initiatives that need to happen in the organisation.
Enabling new capabilities
“Pre-pandemic, we didn’t think we could close books remotely. Proof that we can work differently has changed the way the function is working within organisations. Finance was previously behind the scenes, now its role has expanded to be a more business facing role,” says Fred. He asserts that in that context, finance leaders need to be able to adopt the perspective of those across the table from them, collaborate with the rest of the business, communicate financial forecasting, and work with the c-suite to make fast decisions.
It was very hard to have a clear vision of numbers before, but now technology has advanced and with new data tools, finance leaders can analyse insights and make decisions timeously. With Cloud and ML in play and delivering a new level of agility and ease of adoption, finance can be up to date with every aspect of the business.
The future-ready CFO
Fred notes that today’s environment demands a shift from finance leaders as gatekeepers to business partners. He says in addition to keeping an eye on the inner workings of their organisations, CFOs need to watch global markets and the dynamic socio-political environment we live in closely, then go a step further and share their findings with the broader organisation. He emphasised that it’s important to consider the people change management element in the organisation when transforming, so people understand the vision and buy in as active participants. He says leaders need to invest time in that process and skipping that step risks slow momentum and can create fiction.
Fred says, “We have been used to speaking to auditors, shareholders, regulators. The new finance role has a broader audience, one that requires moving to be closer to the business, to support it, listen and communicate back numbers and offer guidance.” Tomorrow’s CFO must therefore have strong interpersonal skills to not just collaborate with the rest of the business, but to implement data-driven change and get buy-in across the organisation. Fred adds that the pandemic has given people time to pause and think about what they want to do with their lives, resulting in a lot of mobility between organisations and within finance. Keeping and retaining talent in finance is also a question of finance leaders promoting the value they deliver to the organisation, what he calls a ‘rebranding of finance.’ He says that companies need to bring in and keep talent in finance through modern tools, train those teams and keep them evolving because that is what is now required. He says new entrants are digital natives and expect the workplace to be strongly digital and because of that, finance has to be more open and agile.
