Tag: employees

CFO Folklore: My “Favorite” Questions


Ah, the Holidays!  They put you in the mood for remembrance.  Families get together and stories of past times and lives start pouring out.  My grandfather was a brilliant man of the WWII generation.  He died when I was a baby.  Hence, I cannot remember this myself, but I've been told quite few times about his main pet peeve: he couldn't stand what he called "idiotic" questions.   Apparently, I've inherited this familial trait.

His being the times way before the political correctness permanently  stifled us, he had the luxury to call things as he saw them.  Nowadays, I use more neutral words.  I call them nonsensical questions.  I even trained myself to ignore stand alone occurrences.  However, there are two questions that pervade my professional life.  As all pet peeves do, they cause undue frustration.

The first question is consistently asked by my subordinates and peers.  You see, unless I attend to a confidential business matter, I always keep my office door opened.  I believe it is good for employees' morale to see a CFO working as hard as I do. 

So, these people see me all day long attending to my scheduled tasks, addressing issues, solving problems.  I am consumed by work.  Yet, EVERY TIME one of them needs me and comes to my door, they ask me THE SAME question, "Are you busy right now?"  In response I want to scream, "Of course, I am busy.  Can't you see?" 

It doesn't mean that I am not available to discuss their problem if it is of higher priority, or scheduling them for a later time slot if it can wait.  But why do they have to ask that question?  At staff meetings, I teach them to approach this situation in a more sensible manner: come, don't ask the damn question, instead state your issue and let me decide if it requires immediate attention.  Some learn, but the rest just cannot help themselves.

The second question is similar but essentially different in its nature.  It's usually asked by the boss.  And, as we already discussed, there is nothing you can do, but to bite your tongue.  He has something on his mind, so he comes to your office.  Here it comes, "What are you doing right now?" 

The involuntary first reaction is, "What do you think?  I am doing nothing.  Just sitting here enjoying myself."  But he does not imply you are not working.  This is how their minds work: whatever is on his mind is the most important thing to him right now and in his opinion should be to you as well (even though you don't even know yet what it is).  This attitude renders your current preoccupation irrelevant.  Now, it is up to you to navigate the situation properly into the safe harbor.  Over the years, I've developed an arsenal of methods.  I am sure you have too, but if you need my help, please, don't hesitate to email.

New CFO, Same Staff: Inheritance Problems


Ok, let's leave our bosses alone for the time being.  Let's talk about us as bosses.  In our multi-functional lives as CFOs and Controllers we frequently end up with more direct reports than CEOs/owners.  There are accounting managers, finance directors, budget and analysis groups leaders, PR, AP, AR, IT, and so on.

Let's say you are making a career move and just accepted a position with XYZ, Inc., replacing a departing CFO.  In a dreamy corporate fairy tale you should be able to do what our newly elected presidents do – form your own cabinet and move in with your faithful acolytes. In real life… you inherit somebody else's staff.  Moreover, you have to quickly immerse and keep the business going.

The subsequent events can play themselves out in three possible scenarios:

1.  Without giving the existing operations a real dissection under a microscope, you simply learn how everything functioned under your predecessor, decide not to change anything even if you find the old ways inadequate or wrong, and continue in the same fashion.  The effect: good for the staff – no changes, no new things to learn, no old habits to break; bad for the company, your employers and ultimately yourself – inheriting diseases without attempting to treat them will assure your failure.

2.  If you are a responsible and knowledgeable person with an impressive background and enthusiasm for your new job, you will study all aspects of functions under your control, diligently, but without prejudice; find errors, shortcomings and blind spots; apply your expertise, and develop improvements and innovations plan.  And then you will face incredible resistance from your inherited staff.  It is very natural: humans are resentful of changes.  They will give you very hard time, no help and mountains of frustrations.  Just because you are great at finance and accounting, it does not mean that you are good at managing and educating people.  If you don't have patience and sufficient skills to overcome the resistance in a positive way, you will end up firing a third of the stuff and another third will leave on their own.  The rest will stay, but you will never gain their trust and support.  The worst part – by replacing former employees with new ones, you will loose the continuity of the departmental knowledge.  

3.  Under the best case scenario, your professional and managerial skills are equal.  While you sifting through processes, functions, policies and procedures, you must study the people.  What motivates them? Do they know their jobs well? Are their duties properly matched with their abilities?  Psycho-profiling is one of the most important managerial skills.  Try to discern the personality traits of your employees.  The personnel strategy should be part of your improvement plan.  Find people who are interested in positive progress, explain to them how the new developments will benefit them, show them the big picture (for more on this subject see my post Big Picture and Staff Training) and make them your agents of change.  Then you can claim the successful transition.    

Big Picture and Staff Training


Closely-held entrepreneurial companies always have some flair of secrecy.  The Owners' lives are intertwined with the businesses and because of that they apply personal privacy rights to everything, including the company's commercial and organizational matters.  This frequently leads to "need-to-know-only" modus operandi when dealing with employees. 

CFOs, Controllers, Directors of Finance are expected to act in the same secretive manner.  And I am not talking about non-disclosure of commercial secrets, compensation details, or owners withholdings – these matters are confidential by definition.  I am talking about organizational structure, commercial partnerships, new financial relationships, transactional details, new venture plans, etc.

The owners who insist on such covertness make a mistake of disregarding the natural human instinct of their employees to fill in the blanks.  In the absence of actual information they will cook up their own assumptions about concealed matters. 

You wouldn't believe what kind of wild baseless fantasies I sometimes uncover: non-existing silent partners, astronomical sales volumes, mythical lines of side business.  In one of my previous employments people even assumed that I was a member of the owner's family on account of my loyalty and strict work ethics. 

That's just laughable, but there are far more serious impacts of secretiveness: people don't understand the mission of the organization, the commercial scope, the structure, the value chain.  Most importantly, they cannot grasp their own place and relevance in the system.       

The unfortunate effect of this disconnect is mechanistic disinterested performance instead of meaningful work.  On one hand, the bosses insist that their employees are kept in the dark, and on the other hand, they would like to see high efficiency and productivity – impossible to coexist.

I have managed to convince most of bosses that while keeping the actual confidential information secret, it is absolutely crucial to provide my subordinates with the Big Picture and their place in it.  I consider this to be the most important step in staff training and development.  You will be wasting your time trying to teach your employees how to apply their expertise and education to the tasks you need them to perform if they don't know why these tasks are important for the company's, and consequently, their own prosperity.

When explaining their role and place in the Big Picture, I frequently tell the employees that the company doesn't employ them to pay salaries.  It is actually other way around: if the company could operate without the employees jobs done, we would gladly do so and save the money we pay as compensation . But it is crucial for the company that the jobs are done well and that is why the employees are retained and paid.  You will be surprised: it is not as clear to most people as you could expect.