The Four Pillars Every CFO Needs (and why FP&A is THE Growth Engine) with Steve Rosvold

Big concern that there's no accountants anymore because there's not as much accounting work to do. So accounts are moving to F P and A. Right. And the FPNA people, my sense is FPNA doesn't, you know, they don't want to be a coward. Right. They look at and they gotta be careful because these accounts are really well trained. And so make sure your account's your best friend. But they're moving into FPNA because that's where the jobs are because a lot of the the accounting is again super important.

But we're mechanizing that quicker than we're mechanizing the FPNA part. And so there's gonna and these are smart, talented people. They've done their certifications, they've gone, you know, and they're not lazy. And so, you know, th there's this kind of I call it that maybe it's going back to the way it was, but we're gonna have these accountants that are competing for FP and A jobs, which are gonna be growing. So there's no no I don't think there's a big problem there.

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So, for my loyal podcast listeners, I am giving you free access to it today. Check out the link in the description below to upgrade your SPA skills today. Thank you. I would first like to welcome Steve to the FPN Day Unbox podcast. This is our attempt to talk to, you know, FPNF professionals and finance leaders across the board, in fact across the Atlantic, clearly you're on the other side of the Atlantic.

to get basically, you know, insights and thoughts from leaders in finance such as yourself on challenges, you know, guidance on careers and things to do, not to do, watch out for in the future and stuff like that. So a very warm welcome, Steve, and many thanks for being our guest in our uh you know.

Early episodes for uh FPN books. Well I I'm so thrilled to kinda help you start this uh and I'm I think I'm one of the first guests, so I I'm honored to be one of your first guests and excited for you to deliver your expertise and the expertise of your guests. to the uh global FPNA community. So congratulations on getting that started. Thank you so much, Steve. So for the listeners, Steve lives in Vancouver, Washington and West Coast, US West Coast.

Yeah, he has a career earned with his MBA from Chicago Business School as well as basically he's worked for twenty two years in large multinationals, few as a CFO roles across Chicago, Minneapolis, Boston and Geneva. after which he started his own CFO advisory firm. Fast forward from twenty seventeen onwards, I think Steve is much more famously known for the CFO university, which is a global professional development community dedicated to growing world class CFOs.

Preparing them for the challenges faced by the modern CFO. This is something which we will be delving a bit more deep into.

As we go along, Steve lives with his wife Pat, has three adult children Four young grandchildren and I don't know, did you have your daughter granddaughter just yet or are we still? Lovely. Congratulations to the two be parents and to the great parents much in advance. Thank you for sharing this wonderful news with us.

So with that, if I can start with a few first of all, you know, initial questions on As I said, right, CFO university frankly, even I've been following I think last time we spoke was four years back.

So I've been pretty inspired with the CFO university as well. So tell us a little bit more about that, you know. What inspired you? What who does it address to? What needs does it meet in the market and stuff like that? Well, thanks for that question. And so, you know, in my career I'd spent it all in finance and accounting and had some CFO roles. And I never found a place I could call home that was kind of outside of my own work group in my own company.

And so, you know, I I kind of as I started my CFO advisory practice, I got more familiar with many different CFO roles and many different companies. And as I started to think, how would I develop a community and what would I develop it around? So we came up with the four pillars of CFO success and I thought, okay, you know, do we and I don't think it's unique now, but it was kinda unique back then. But I define the CFO role with kind of four different areas, accounting. By the end?

Treasury, and then leadership, which is kind of the big elixir at the end. And all those get covered by technology, whether that's analytics and AI or or human resources, career management, they all impact that. But our four pillars That we really focus on counting, finance, treasury, and leadership. And so when I started making up that framework, I said, how then would we teach this?

And how would we share it? And do people agree with it? Is that what the CFO role is about? So can we expand that? And so As I started my advisory practice was one on one. I had clients, I was doing CFO work, I was advising boards, helping CEOs, things like that. But it's all one on one. So I thought, how can we get to a broader audience and help more CFOs, not just the companies, but help CFOs get better and create more value for their careers and for their companies.

And so then we built out the four pillars. We did some assessments that help our, you know, our learners end up growing and understanding kind of where they need development. And so it just got more exciting as it went on and now we have over a hundred contributors.

very you know, so we have a really great library of tools for people to use and c and so yeah, it's been a a great journey, but it it stemmed from my finance and accounting background through to my advisory practice that I ran myself after coming out of the multinationals. And then how do we teach CFOs to be CFOs to

And that's really our ambition now. Uh but sorry, I'm going to uh diverge a little bit, but no FPNA in your pillar. I mean obviously it'll be interesting to understand that one. Well, you know, FPNA is kind of interesting because FPNA is a relatively you know, finance and accounting are so related. And so in a lot of companies, the finance and accounting is kind of the same thing. You know, we've kind of separated that over the past 20 years. We've said, hey, they're very different fields.

Whereas in a lot of mid-sized companies, smaller companies, accounting and finance kind of run together. And so our finance was as I was a CFO, our finance team and accounting team were super connected, you know, and we had a financial analyst that would help close the book.

You know, our FP and A people were were kind of cross purpose. So we had somebody maybe focused on budgeting and forecasting, but they also helped the accountant, the controller close the book. And so that FP and A part was really part of the whole DNA of the roles I played at Cargill and Conagra and as a CFO, meeting that function where you know, the financial uh the F P and A role um was important then and it's just grown and important since. Okay.

So that's vi so would you say fairly that in your pillar accounting kind of covers FP and D within itself? Is that where where you no and that's what's changed over the twenty years. So our accounting pillar, if I there's kind of four core or three core competencies under accounting. It has to do with governance and internal controls. That's kind of the setup of the business, making sure the structure is good for internal controls and governance.

And then make sure recording is proper. So booking entries, making sure that's right. And that might be system driven, but it also takes the technical expertise to know what entries to book. And then the reporting. And the reporting is more the think of it as the uh financial reporting and maybe some light management reporting. And the FPNA roll starts.

That then you know, that is the uh what people look at and and they use it in a pejorative way, but I think that's wrong. That's so the accounting is so important because if you can't get that right, your foundation's never gonna be right. So then F PA is that piece that goes from forecasting, budgeting, investment analysis, and that's exactly how we have our finance pillar is really our F PA pillar.

It's all the forward looking part of the role. And we have, you know, three core competencies there. And one of them is the forecasting piece. So keeping up with the budget, call it. There's the budgeting piece, the annual planning, the strategic planning side. And then there is the investment analysis. So as you're deploying capital, where do you deploy it? So your growth strategies, how you look at individual investments on a large scale.

And so that's really the finance pillar, FPNA pillar. And then we have the Treasury Pillar. Now the Treasury Pillar also has three core competencies that have to do with cash management. Number one, need to be able every CFO ends up having to manage cash.

Some CFOs end up raising money, so there's a funding component. So the second the second competency is funding, raising money. And the third is risk management, because once you start taking on third party money, risk management in business is skyrocketing.

Right. So all of a sudden you have a lot more people interested in what you're doing. So we put the risk management function under Treasury. And then the final pillar to go on is our leadership pillar. And leadership kind of starts with your own self awareness, learning about yourself, understanding yourself. going into teamwork and team building. And then our third core competency under leadership is strategy and culture, building the strategic, giving a mindset for strategy.

building a culture that works for your company, things like that. So We just went through the whole four pillars of CFO.university. So thanks for asking the question. Sounds brilliant. I mean I wish I was a CFO. I would love to do that one. Well you're not it's just a few years away. No, I'm not looking to I'm really enjoying the advisory I'm doing at the minute, to be honest. The transformation work that I'm doing at the minute, I'm genuinely enjoying it because like you hinted, right?

This is what a CFO or a finance function is expected to deliver, but basically data process and technology is how they deliver. And that underlies your four pillars. Agreed, your four pillars are your front end. But to be able to do that front end, that back end of data process and then technology is critical. Otherwise I can't do any of those rules.

Even in your accounting roles of you know recording your invoices of booking your payroll journal, there is data. There is a process around it. There can be technology automation around it. And with AI coming up more and more, right? So there is so much exciting stuff on this side that frankly I'm enjoying doing this. I can't imagine going and becoming a CFO for one company. I'd rather have twenty companies CFOs to do this, much more fun that.

Good for you. Well that's that's a value add for all the CFOs out there for sure. No, definitely. So you've just gone to the four pillars, right? And they're really, really interesting. So from your perspective, can you share a story of a CFO where you've seen So like the like my eyes lit up as soon as you talked about the value I can add. So is there a particular story which let you know?

job satisfaction of oh my god we added so much value to this person's career or that to this company's activity and things like that. Do you have a story you could share with us? Yeah, you know, recently so I do some consulting occasionally, usually people bring me on as a CFO advisor or as a C interim CFO and there was a company in the Pacific Northwest here

who um they were having some trouble. They had some personnel issues. So they had lost their CFO about six or eight months ago. A controller came on and kind of lasted three months, was very good, but did just d saw the big mountain in front of her. And so what happened is there was a young accounting manager. And this accounting manager was with the company less than four years, really sharp, but very inexperienced.

Right, and was on the very much closing the book side, the accounting side, and they promoted him to controller. And what had kind of lost in all this transition, you know, they had lost a lot of control. So reconciliations w they their foundational pieces were kind of broken. They didn't have the leadership they needed. So when I came in I worked with this individual Who is really green, but really smart and really hungry, wanted to do well. So just the kind of the perfect

student, if you would. And so the first thing we looked at is foundationally what was going wrong. Well they weren't getting the books closed very quickly and they weren't reconciling accounts. So we had to do some foundation, very foundational things, but so important. And that's where

You know, we may discount accounting and some people may say they weren't reconciling accounts, but you'd be amazed how many companies there is problems reconciling accounts. And it's the kind of the first step in having a good financial report. So we kind of fixed all that up and that was really important. Then we spent time educating, so they had a cash issue. They were running out of cash. So that's one problem. The other problem is they didn't know why.

So you know there wasn't the transparency. I should give this background too. What they did is they had bought a big ERP system four years ago. So just before, just or just after COVID, they'd invested in a big ERP system. They were on QuickBooks.

It was four years later and they hadn't installed the early. You know, they had been doing stuff with it. They'd been w they've basically using two systems for four years. People were completely worn out and they wouldn't ever pull the plug.

And QuickBooks. And it was it's a well known system that they use. So there was some real problems with that. But can you imagine going through an ERP installation? It's a twenty five million dollar company for four years. I mean it no wonder why they went through a lot of people. At anyway.

So they had this big issue there and so they couldn't they had no transparency. So we worked with the uh we educated and I worked with uh the controller to kind of teach him h you know, to help them help him develop his executive presence'cause he's presenting to investors And he's presenting to the leadership. And we went through a whole working capital project and we saved this company about a million and a half bucks just by educating and connecting sales with procurement with operations.

And there were so many big aha moments in the the first couple of months uh and uh this controller just really kinda took the bull by the horns and wanted to learn and was so hungry. And they're look to have a very good year this year. They look like uh they're set ups for a super year where they were

They were in big trouble. And, you know, this controller has taken all has gotten a lot of credit as he should. Yeah. No, that the it's so much satisfying, right? When you see that satisfaction of somebody moving from a point A to point B and you had a role to play in that one. It is so much more satisfying.

But you gotta find somebody really hungry. So finding the right students sometimes is a way to you gotta find the right person that really wants to grab it. Honestly, I tell you how many times on LinkedIn people message me that, you know, I want to get into FPN and what should I do? I'm like I genuinely have no answer to that because I didn't ask for FPN in my career. I just said how can I add value? And I figured my way out.

I mean, there is I don't know. I mean you have to have that self-driven motivation. So you can always get mentors like Steve to help you out, but until then unless you are मुटिवेद और से राइ You can take the horse to the water. You can't make him drink if he doesn't want to drink. So you have to find the horse who wants to bend down his neck and drink the damp water. Well, and and you know, if you think about your role, my role, we're trying to develop people and

So part of my selection process is trying to figure out, do they really want to do this? A lot of times a a president or CEO will say, I really want my CFO to get this help. Okay, that's one step from where you really want to be. You want the CFO to be asking for the help. So I do a little bit of clearing, you know, and it is on listening to people and and understanding

Is this really somebody who I'm gonna enjoy working with because they're really hungry or their boss told them to do it? So I have a little bit of a selection process. on what I know is going to be successful. Cause if it's somebody pushed into it, it's unlikely they have the motivation. I'm always going to look at that person that the boss sent in to kind of parachute in and help them out. And that usually doesn't turn out. I will share a t a thing with you. I have to share the story now.

When I was at G Healthcare, I used to recruit I had a team of like six to eight people, and I used to do recruit on a regular basis for interns and stuff like that. People started attending my interview process. Okay, because they're like you do something different and we don't get what you do. I'm like I don't care if the person has the skills or honestly they are they have half the skills I need.

Skills I can teach them. We look up some if, you know, pivot table, all of the conditional formatting or whatever, or making a board deck or things like I can teach them. Okay. I look for attitude. If you don't have the attitude of learning, of open mindedness, of being adventurous and going and trying new things.

It's impossible to teach that person, I feel. Right? Then you are you it's a lost battle. No matter how good a teacher you are, you're not going to break that wall because this person has just put a wall between you and that. Yeah. So again, to all the people who are listening looking to progress in your career, take the wall down, be open to learning and then figure it out. I'm sure you'll find a mentor or a job somewhere where you can, you know, f learn a few things. Otherwise

Sorry, why what are you doing then? That's so true. And very closely linked to that, and it's something else I look at and I and you'll probably hear it throughout this uh this kind of same theme, but this insatiable curiosity to know.

So that's kinda that's related to learning, right? And so people who just they don't accept the standard answer. They want to understand w the whys behind it. And sometimes you gotta be careful because you can drive people crazy if you keep asking them questions that's right. You so you have to have a tact about it. But you want to get to the root issue. And recognizing that is really so this insatiable curiosity to learn and that in that

you know, they want to grow. Those are really important uh I think criteria for people who want to uh you know be really strong professionals and and create a lot of value for themselves and their companies. So curiosity and basically willingness to learn.

are two skills you've already covered. What other skills and competencies do you think a successful CFO needs? Especially when you're doing this environment, right? Where business is changing every day, Trump is doing deals every morning, every morning you open the newspaper, Trump has done something. So, you know, in such a dynamically agile environment, uh, what are the skills a CFO needs? Well, you know, a lot of people take this for granted. I don't, but you

wanna be grounded in the financial statements. You have to be able to commute communicate to your your executives and all your stakeholders, your the board, you have to be able to communicate in their language the financial statements, what's happening, why is it happening? So a deep understanding of financial statement is really important. And sometimes that gets discounted. But it's super important.

So that's one thing, and we just talked about this insatiable curiosity. So the the financial statements, deep grounding in financial statements, and insatiable curiosity to learn new things and and that includes being able to recognize anomalies. So if you heard from the sales staff that hey, we are making a big push on this product over in one meeting and you walk over to the operations group and they say we have a machine shutdown, we're not gonna make these products next month.

All of a sudden you gotta put that together. The sales team better be careful and not selling product we don't have. So that ability to recognize kind of what's happening in the business and detect those and then talk about'em is really important. I think f to be successful in this leadership role, you need to be comfortable giving up

You're giving up what you have built yourself. So all these individual wins you've had and that individual role you've played, you have to be able to say, yeah, that was really satisfying, but now I'm going to let somebody else do that. To be successful, you have to step out of that individual contributor role and be more strategic and let other people be s you know, create success for themselves. So I think that's really important. That, you know, some people might call that delegation.

You know, I would call it being, you know, giving other people the chance to grow and and things like that. I think you need to be a teacher. So you know, so you had said you did this teaching, people started coming to your lectures because you know, you were t creating value for them. And I'll give you a really good example of this. So I was uh in a commodity trading business. So the first part of my career I spent at a company called Cargill and they traded grains and things like that.

And the way they thought about financial, especially the commercial people, so our merchants, we call them the traders, they didn't think of sales and purchases. Right. They didn't think of cost a good soul. They thought about positioning and price. So they looked at I'm gonna buy a million bushels of corn and then I'm gonna go cover it some other way. I didn't sell five million bushels of corn or five million dollars worth of corn.

I sold so many units and I hedged it and so that their language was completely different than what we've grown up as finance people, as accounts. And so I had to learn that language, but then we had a whole different way to estimate our P and L and we made the traders the day after the close, the every month then the traders all determined estimates. And they were notoriously bad at their PL estimates.

And so I went out and trained our, you know, we had to develop a system to help them kind of algorithmically calculate their PLs. It was nothing like revenue less cost of goods. That is not how we did it. And so it was a whole different world.

Anyway, so that was huge. And that created within that group. So all of a sudden the merchants are coming to me saying, How do I do this? My P and L was wrong. I'm getting my boss is all over my back because I didn't do a good estimate. He doesn't think I know what I'm doing.

And so it really created what now would be termed the finance business partner, right? So it'd be it created that tight link where I could really bring a lot of value to them as long as I knew what their business was and I can convert that. to accounting. And instead of making them learn accounting I had to learn, you know, their business a little bit. So So being a teacher, that's that's the main point there. And the final thing is teamwork, you know, bringing people together.

and kind of connecting people in a way that makes them want to work together and contribute to each other. At least they see the value in each other. They don't have to necessarily like each other and all that, but they have to see how they can you have to be able to show them how by working together we're all going to be better off. And that's really kind of the team building approach. Yeah, no, I have to do share a story on the one previous point that you made, right?

of looking at the sales push in one direction and operations machine is down in the other direction and then, you know, it's not working with each other. I had a similar story where RD director was asking me for more funds for more RD and you guys finance people don't want to invest. in the future of the company. I'm like, hold on. I'm not saying no. So come. Okay. Let's figure this one out.

And then made him list out all the activities they were doing, what projects you're working with, what's the money you're spending on it, blah, blah, blah. I said, okay, you've got seven projects running and can you sell all seven of them? Are they all commercially viable? Got the sales and marketing director in the room. I thought this guy's telling me he's going to work on seven projects.

Can you sell all of these seven? If he delivered all of this tomorrow, can you sell it? And they're like, no, actually we don't need all of these. We just need four. We don't need the rest of it. Right? I'm like, perfect. Can't afford you've now got three projects. You need to focus on only three of them. And those three you have got enough money for. In fact, get that done faster and you get that commercialized. And you get that commercialized. They earn the money for you.

Now voila you've got money for new phone projects as well. So it's finance can't create money from thin air. It's about prioritization. It's about commercialization. We are not we should stop being no-sayers and we should be saying ha. If that will not make sense. Don't say no. That's great. Yeah, you know,'cause a lot of times the CFO has been known as the chief no officer, right?

And that's not the way you approach it. And, you know, that comes fr I'll be honest with you, from the control side, the controlling background. So the governance, that whole accounting area where, you know, your big penalties if there's internal control issues and stuff. And that kind of can leak into the whole CFO role. So you gotta really be careful that when you're exerting that accounting control governance aspect.

that you're not driving other people away and creating that barrier that you just talked about where everything is you start with no and then convince me you're right. You know you really want to start with yes and convince me and we'll figure out if we're wrong. And so it's a mindset issue. Yeah, that is it, right? And today I think as we go ahead in twenty twenty one, uh cent twenty first century, right, we need to learn to be able to say yes more.

with the questi helping people prioritize rather than again making a decision for them. Again, what some of the success I have seen in life and career is Help people make the decision. Because if you enforce your decision on them, they will push back. But if you take them on the journey to get there on their own and then suddenly you've got Ah, okay, I like this, this is interesting. So, you know, that's quite good fun.

Cool. So balancing in your experience basically what are the effective technical expertise and strategic vision leadership that a modern finance leader needs, right? Because Obviously a modern finance needer needs to have technical again. Now technical splits into two. In my world, technical splits into your technology technical and then in the accounting technical of your IFRS and things like that, as well as

Strategic and leadership roles, right? So how does a finance leader balance these things out? Well, we all want to brag about how strategic we are, right? We all want to say, hey, with you know, I I have but I think first comes it with some awareness. Why are you being hired? And many times you're being hired to fix the foundation. If you're being hired to fix the foundation, you know, go pour concrete. Don't try to redecorate the fourth floor, right? So

fix the foundation first. So before you you know try to become strategic. So if you haven't been strategic in your past, so you've been in nuts and bolts, you maybe been a a controller, F PNA manager You haven't done the you know, don't expect you're gonna be strategic when you walk in that room. So that takes practice and it takes a need. So I'd say one thing, make sure you understand why you're hired. You can always grow into that strategic road, but if the if the foundation needs to be fixed,

And all she do is spend time on the fourth floor, the foundational never gets fixed. And if that, then you're gonna get fired. So make sure you understand that. I'd say one thing, you know, you don't have to be strategic if that doesn't what your job entails when you start. You can always move to that.

So, you know, you don't have to jump to that and say, Oh, I'm not being strategic. I must not be adding value. Your business might need the foundational work. It might need to close the books quicker, get the accounts reconciled. You know, make sure there's good cash flow statements. Th that kind of s some of the foundational issues might need to get fixed.

Uh and then you can work on. So that's the first thing I'd say is make sure you know why you're hired and why you're there. And if you've got an idea that that is different than what your bosses or the board do, you might not last very long. And then once you've got to that point, so you've the foundation is solid, now it's all about building that team and the systems, putting the systems in place. kinda push you up, really that all lifts you up and that's the idea

Training the team. They can start taking over those duties that you had to look over, having a controller who who all of a sudden you feel really comfortable that the month ends are going well, you don't have to be quite as involved in that anymore. You have an FP and A leader who's doing all the forecasts that are really good. You're just reviewing them. You're not doing them anymore.

So it just it's an evolution in your role. Don't think of it as, you know, going from point A to point B immediately. It's a journey to get from one to the other. And uh be cognizant of that. Don't if you try to be strateg unless you've been hired to be the strategy, you know, a strategy guru, and you'll know that during the hiring process. You don't have to do that in the first week you're there. That's something you grow into and you learn from. And if you try to get into it too quick,

you're gonna end up something else gonna fall through the cracks and you may never get a chance to practice, you know, that strategic role. Yeah. If you don't get your A's correct, then your Bs will not work. So get your foundation correct, otherwise your fourth floor will fall down, which is not going to work.

Exactly, exactly. Yeah. If you duh d dive a little bit into F P and D now, right? So how do you think the role of F P N has transformed? Because again, you said right ten years back F P N was not exactly a recognized role as such. Yeah. So and in small and medium companies even today it's sometimes not. So

How do you think the role of FPN has evolved given the, you know, amount of data we deal with, advanced analytics, automation tools, you know, AI. Oh my God, I can't get through a conversation without talking about AI these days. Yeah. So wha how do you think the role of FPNA has changed? What has changed and what's remained the same? Well, I think what has changed is FPNA is the growth engine of the CFO role and it's the growth engine of many And that

That has to do with the kind of the shifting sands where, you know, accountants are being able to do things quicker, faster. You know, we don't have to spend so much time on the history. Our systems are stronger. So we're able, you know, we don't have to spend so much time on the We're spending less time in the past and FPA is future oriented. And so I think that's the the biggest thing is the the F P and A role is really becoming the growth engine. When you add in the analytics, dated analytics

I wasn't going to mention AI. I was going to try not to mention AI through this whole meeting, but but it's it's certainly there and that it's it's helping us a lot. So, you know, you have the technology changes and that's creating things that we didn't have before. Being able to do the big analysis on data sets in pricing. So and that all fits in the domain Of the CFO and where the CFOs are putting that is an F PNA.

Right. I mean they're saying this is, you know, this is this, you know, you're it's related to budgeting, forecasting, strategy, planning. That's and that's what we're we're trying these insights are being used to craft new ideas, change things, understand where, you know, what needs to be changed. And so that's all the analytic and that's where F PNA has really grown from my view from the uh and kinda created a separation between what we call accounting and what we call F PNA.

And so what hasn't changed is, you know, there's always been analysis and competition. There's always been budgeting in companies in in my career. You know, those things have stayed the same. And they've, you know, there may be different words that we give them, but you know, whether we call it, you know, budgeting or just general planning, whatever it is. There's always been that forward looking, what do we do next year? What do we do in five years? That hasn't changed.

the data part of it where we're getting, you know, we're asking more of people. We're using more outside information rather than internal information. And we're ha you know, there's a lot more data to kind of analyze, that's where it's getting much more of a specialty.

You know, how do we make sure we're looking at all the right things and that the tools, how do we make sure we have the right tools to do that? Sure. That makes a lot of sense, right? So technology has evolved but the fundamentals still remain the same, right? That's not changed.

So what strategies can FPN leaders employ to enhance their organization's agility and decision making abilities, right? Because again, one of the complaints from finance is you guys take forever to come up with an answer. The business moves much faster than that. So how do you make sure that uh organization's agility and ability to make decisions is really quick and prompt?

In conjunction with the ever changing environment. Yeah, you know, I think one of the things uh is always focus on am I creating value? And that isn't just for the business. You really want to create ca you know, value for your colleagues. And how that speeds things up is as colleagues recognize you as a go-to, and that may be your FPDA team or it may be your commercial team, doesn't really matter. But it what happens is you get in the know.

So your team, you're knowing what's going on. Otherwise, you know, in some teams, if they don't see you creating value, if your colleagues don't see you creating value, you're kind of last on the list to get the phone call. Hey.

I think you know, oh now we need the money to buy this machine. We've done all the analysis. Now we're going to turn it over to FPNA. You know, you want to be on the front end of that. So one of the best ways to really speed things up.

is make sure that when there's big decisions to be made, whether it's capital allocation, whether it's, you know, expend you know, hiring a a new teammate or whatever these, you know, whether some big investment for your particular company would be, making sure that people think of you first, not last.

'Cause once they think about you last, then you're coming from the you know, then there's all kinds of reasons that, you know, you're gonna come up with to, you know, why this isn't gonna work. You come up with a lot more than if they start with you. So you gotta make sure you're adding value and creating value.

That's probably the the number one area. Then I think there's a a mindset issue, and this is more about better decision making than necessarily quicker decision making, but you want to make sure that you're making your decisions on data. not because of the loudest mouth in the room or the biggest type. Right. We want and so from that perspective, and maybe that that's agile because what happens is you're not making as many bad decisions.

But thinking about, you know, putting that mindset that we're gonna make our decisions b our significant decisions are all gonna be made up based on data. It's not gonna be who's got the biggest voice, who's yells the loudest or who and I went through that uh in my early days. It was a trading business.

Traders are pretty big egos. They wanted to be right. And the one who yelled the loudest a lot of times, that's the direction we went. And, you know, I learned that pretty early in my career. That was really bad, bad ways to make decisions. And I think Cargill did too. So that whole environment kinda changed.

I think you really uh you really want to make sure that, you know, as much as we can. Our job is to make sure we get the facts out, get the data out, and then draw the insights from that rather than use a bunch of intuition. And intuition is important. You always start with intuition and then you try to prove yourself wrong.

I'm not saying that's bad, but I'm saying, you know, if you can support it with facts and data, much better decision making. Active listening. So I think it's really important that we're active listeners and that's That means, you know, we have two ears, as Andrew Cod reminds me occasionally, we have two ears and one mouth for a reason, right? And so active listening becomes important and uh I think that's uh You know, sponge things up and listen and you'll pick up a lot more that way.

And then I think uh and that the agility there is you're not you're coming up with some ideas to help move issues forward rather than again waiting to receive them from somebody. So you're recognizing that, hey, we should I should talk to sales about this or I should talk to procurement about this or operations needs my help here. And by really listening intently

And then I think the part that really is agile is putting a reset button as we're doing projects or it might even be an old process we have in place. But at some point there has to be an understanding that this isn't it's if it's not gonna work. Make sure you know when that is. So you don't keep pushing things ahead and

that are kind of dead in the water. So kind of and that a lot of times if it's a pet project, if it's something you invested a lot of time in, you get this sunk cost issue. So if you don't think about it up front, When are we going to pull the plug? When do we know this isn't going to work? Or when do we when is the ROI not there? If you don't think about that ahead of time, you can just drag things on and on and on. So

That would be the other thing. Yeah, no, I think I've seen a qua quite a fair few of projects which are basically pet projects from people and they realize that this is not gonna work anymore, but they don't want to stand up and say this is not working, we need to stop because There's too much of ego involved with that one by the time.

It becomes challenging. I I get that. I it is challenging Yeah, you get really invested in it. You got the sunk cost uh, you know, problem and and sometimes it becomes personal. You know, project and so sometimes you have to look in the mirror and say, Hey, you know, the but if you don't if you th have those conversations up front, you're much more likely to uh

to then actually take the right action when it the time is right. One of the challenges I think I've heard to be fair is you know a lot from people when I speak to on LinkedIn as well. of you know, they are saying they just we struggle with hiring the right again, the keyword I have to use this right talent. Now what does right talent mean? Right? So how do you build a finance team which is high performing and

What are the attributes to look out for when you're trying to build a high performing finance team? You know, I think for the individual's sake What I look at uh empathy is number one. People who and I think it it's not a term that we use very often in finance, but empathy to me means understanding why that salesperson behaved that way.

understanding why procurement behaved a different way and why you know what understanding you know people don't act irrationally on purpose normally in a business set. And so, you know, rather than jumping to some conclusion like that was stupid, right? It's just why did they react that way and really understanding and that to me takes empathy. So that isn't coming down someone's throat. It's it's actually really getting a deep feeling to understand w you know, why they took that decision.

and understanding that and then you can address the issues. If otherwise you can never address the issue. You can just tell'em they shouldn't do that anymore and you haven't really addressed the issue. We talked earlier about this insatiable curiosity, which I look for, which I think is You know, that's just so key that people really uh you know, that that's one of the things that that I need. I talked about good listening skills, but we also need good the ability to communicate.

So, you know, you think about you're communicating to a lot of different parties, the finance business partner, the F P and A people are f are, you know, they are

communicating with a lot of the companies. So they have to be able to talk a lot of different languages. They have to be well understood. They have to learn not to talk accounting or finance language. They have to talk in the business language. So there's a communication piece And then I want somebody who's really, you know, a group that is growth and improvement oriented.

So that could be a business, but it's also, you know, how do we get better? That's really focused on how can we make that next step? Call it continuous improvement or whatever you want. But, you know, the best team in the world didn't start it out as the best team in the world. They got there. And so you have to people who want to get there and have the uh the motivation, you know, the personal motivation to be the best.

how to encourage people to be a continuous learning right because it's sometimes challenging to get people to learn and adapt Because they are you know, they are those people who are we have always done it that way people. So w how do you get the we have always done it that way people to actually learn and adapt to go get into a new environment?

How can as a finance how can a finance leader help their team to become learning people? Yeah, you know that that's kinda tough how I look at the first step. If you got somebody who is Done their job for twenty five years, they've done a good job and life is changing, but they've got all this experience. But they're not gonna be they like what they're doing, they're not gonna they're not gonna change.

How do you fit them in? So, you know, there is a place that says there's a place for somebody like that in a lot of companies. So you figure is there a place for them? And, you know, I wanna offer'em things, but you can't, you know, a lot of people you you can't, you know, they've done it a l a long time. They're comfortable with it. They get scared at the change. So, you know, you can work'em through some of that, but

They just are different. You gotta be careful you're not pushing water uphill. But give it a chance to find out how they can fit in. That's the one thing I and I've always been pretty concerned about that. If somebody doesn't you know, you can see they're not gonna be leading this charge. They're not that hungry.

But they're really good. How do you fit them in and make sure the rest of the team understands how they fit in? So they're not getting disgruntled that hey, they're not pulling their weight. So that's part of the leadership side.

So it isn't so much I'm gonna you're gonna do what I I'm gonna send you this course and you're gonna have to go do this. That's not gonna work. It's gonna be you do this really well. Here's how we're gonna leverage it. Let the team know that and we're gonna let you do that. Now, if this system goes away in two years. They're you know, by you not doing these things

It's gonna be hard to find a role for you. I mean, it's kind of that foresight that says, here's where we're going, here's where you can be, or if something changes and you don't, you know, you're not prepared to come along. So there's all that preparation, leadership.

that is f you know, thinking ahead about people. So I I think you're gonna run into those people that you mentioned and my way of managing it is to just be, you know, not try to push water uphill, but help them understand what the consequences could be. And give them the best role they can fit in now but so they understand what the consequences are. Well, I have this thing, right, of asking three standard questions.

if for all my guests. So I'm going to now go to my three standard questions because I would like to spend at least a couple of minutes on each one of them and I'd like to get your thoughts around them. Okay. So question one. Where do you think FPN D is going to be in next three to five years? And you're not allowed to say AI. So in next three to five years, where do you think the future of FP and A is?

Can't mention AI, which I didn't plan to mention that anyway. You know, I think AI, what FPNA is gonna turn into, it's gonna be less. About budgeting and forecasts. And not less about it. I shouldn't say it that way. There'll be more parts of that done automatically for us. So there'll be a review, there'll be kind of the management, they won't be putting together, right? So they'll

And so I think we'll get as good a product as we have today and forecasting and budgeting with less effort. So what does that mean? Well that puts us more into a strategic role, whether it's project leadership, new w where do we deploy capital? You know, where are we gonna, you know, how do we advance our growth engine in a different country or a different continent?

deeper into, you know, what I would call the old SAS model, but where, you know, we're how do we capture data better to understand our customers better so we can make sure we're offering services to them that they need and not charging them for stuff they don't need. That whole you know, product proliferation with a customer insight thing. So I think it's gonna go much more to project work.

and less to these standard kind of forecasting and budgeting. Not that we won't do those. It just won't take as much time. So I I think there's gonna be a more strategic focus. And I think it'll be more project and they'll probably get chances

to come up with their own ideas. I mean, I think they'll have enough they'll have so much insight into the business, they may be bringing in new product ideas, new you know, things that have kind of customarily been sales and marketing or business development side. And I'm not saying they're gonna develop them, but I think there'll be more ideas coming out of that group because they have such insight into so many parts of the business. And that's gonna grow.

because they're going to focus more and more on that as their duties and the standard forecasting and budgeting and kind of that get reduced. I would cast one warning, so before I let you ask the next question, you know, the accountants are moving, they are grounded in financial statements, which I look at as really good. So accounts are moving to FP and A. Right. And the F P and A people, my sense is F PNA doesn't you know, they don't want to be a count.

Right. They look at and they gotta be careful because his accounts are really well trained. And so make sure your accountant's your best friend, but they're moving into FPNA because that's where the jobs are because a lot of the the accounting is again super important, but we're mechanizing that quicker than we're mechanizing the FPNA part. And so there's gonna and these are smart, talented people. They've done their certifications, they've gone, you know, and they're not lazy.

And so, you know, there's this kind of I call it uh maybe it's going back to the way it was, but we're gonna have these accountants that are competing for FP and A jobs, which are gonna be growing. So there's no no I don't think there's a big problem there. But you know, there's big concern that there's no accountants anymore. Well, part of that's because there's not as much accounting work to do.

I agree. I mean, I started my career as an accountant as well. I have done journal entries bookkeeping data entries and got it wrong and then had to pass rectifying entries. and things like that. So no, I completely get it. I agree. But I think if I go back to the point of what is the future of FPN D, if I summarize what you just said, is people F P N D will become more strategic, more commercial.

And more embedded within the business. Can I summarize it like that? Yeah, I think that's a good way. The embedded in the business was a good point that I really didn't bring up, but I agree with you a hundred percent. So yeah, I think that's a good way to put it. And you know, the interesting part when you s when you hear yourself repeat that. Is that makes FPNA, you know, a real possibility to move into more commercial roles if they

You know, you don't have to have just a a CFO route anymore. Now you can get into a different role, whether it's operations or procurement or sales. So so it's gonna prepare people And I that may be kind of a hub for other areas, not just the financial role, you know,'cause there'll be so much exposure to other parts of the business and

Sure, perfect. So next one. So what is the one thing? You obviously look at a lot of businesses you work with as you know, as a consulting or training the CFOs, things like that. So your exposure to businesses is much wider than one. In your view, what you are seeing today in the market, what is the one thing that FP and F functions need help with today to become more strategic? Because

We are transitioning towards becoming more strategic, but we clearly are not there yet. We just made a point. It'll be three or five years by the time we get there. So what do they need help with today so that they can get there faster, you reckon? Just one thing. Trading and development. Okay. Purely. You know, so it's you know, understanding data. So the trading is all gonna come. So assume they know the financial statements. Let's assume that.

And then it's gonna come in in uh, you know, how to use tools, how to use kind of systems data analytics. AI is gonna be a huge part. I know I can't say anything about AI, but that's it's all gonna be about trading and development, how much you're able to absorb.

Again, most of these people are well trade in the financial statements. They've got a good foundation. How do they build on that? And there's a lot of murkiness on what this means in the future, you know, so Anyway, there's a there's both training and development. would be the key. And the second piece,'cause it just'cause I'm gonna give you two in the ask for one, business exposure. So making sure they get out in the business, you know, call it that finance business partner role, whatever, but

making sure they get out in the business and and learn what other people are doing. I always learn much more when I sat down for a coffee with somebody than I sat in a meeting room with somebody. So definitely, you know, getting out to the in the business always helps. I agree completely. Okay. For somebody to look you looking to move into F P and D or somebody who's just started in FPN Da. Right. What are the skills or certifications you think they should be looking to acquire so that they can

do a better job within their FPN D function. Because exactly you said, right? I mean accounting is getting more mechanized. Therefore more people are moving into FPN D. So say your accountant is looking to move into fp and a or somebody newly joined fp and a, what is the advice for them?

You know, so I'll start off giving a pitch for CFO.university and some of our contributors, right? So you're gonna become a contributor, I hope soon after we do this. But we have Paul Barnhurst, Aliy Abdullah, Victor Augelet from Cargill, Ken Fick. And Olga Rudokova. So those are all free. There's no certification there. So I'll just pitch that as a starting point to kind of look at those those contributors.

But I think AFP, you know, the Association of Finance Professionals, this is certainly on the US side, North America. And but I also think they have a big Middle East. I know they had a big Middle East presence. I don't know how much they have a Western Europe, but So the F PAC, they call it from the Association of Finance Professionals. And they're a really good organization. So I would encourage people to kind of get familiar with them.

You know, there's some other ones that I don't know as well, so that would be the best one. But there's also a list. Paul Barnhart put out a list the other day And I'll I'll name'em, but I can't really endorse them. But I can let people can kind of research'em. But there's the FPA certificate from Wharton, which is uh Wharton School of Business. The CGFP and A from the F P and A Professional Institute, and you may be more familiar with these TAS than I am.

And then there's a specialization from the corporate finance institute. So I think that would be one in UK maybe. Yeah. So I think C F I and AFP uh AFA are the two that I am well aware of. Warten obviously Warton is a big business school, so one cannot not be aware of them the middle one i'm not too sure but yes cfi and association of finance professionals i've heard of And obviously what in the schools I've definitely heard of.

But so that's the certification side of things. But what about basically skills, right? So these guys will teach you some technical thought process and stuff like that. But what about real skills? What do you think? What skills are necessary for people to be successful in FP and A?

in your world. So I think the communication side is really important. So and they're all gonna be, you know, th these are gonna give you the hard skills, right? The these certifications. So the soft skills end up being communication. Remember that listening and the speaking, being able to communicate your thoughts and being able to listen really well.

I think there's a a leadership component. I think you're gonna have to be sh you know, they're gonna be important positions. FP and A is how do I say, I'll say it's gonna be more critical. And with that becomes more leadership. If you can't lead people, and at least and and not necessarily on the manager of you. but in the way that I need you to do this for me.

Right. I need you to work with me to get this done. So it's more that type of leadership, not necessarily you become a big director or manager, but you're gonna have to be able to lead people. to do what you need to to have done to be able to be effective. So that type of leadership's important. Sorry to interrupt you, but instead of leadership, can we use the word inspire? So you need to be able to inspire people to do stu work with you. Even though you may or may not be the direct manager.

That's a great word. That's a great word for it. You know, i i influence would be another word in there, but you have to be able to influence people, right? Those are pr probably better words, but yeah, exactly. And then teamwork. So being able to work with teams. The flavor of the day I think in uh in F P and A is being able to reach out past the numbers.

You're not in the back room somewhere anymore. You are, you know, you're frontline understanding what's going on in all aspects of the business so you can bring that back for everyone to help understand and unpack. And so I think that teamwork is is super important too. One last thing and I was thinking about this, you know, if you go home when you go home every day.

I think and this is a tough question. So and it didn't really come from Elon Musk, but maybe that was in my mind. But how did I create value today? What did I do? Not and for two people two purposes. One is in the business. But then also for your career. What did I do today that made myself better?

And what did I do today to help the business? And as long as people kind of can and maybe it's not every day, maybe it's every week or it's every month, but but where you're reflecting on am I doing what it takes to get better at myself, or is that just going to happen kind of by chance? You don't want it to happen by chance.

And then making sure you understand what did I do. And part of that is it being converted to a sales job, making sure that if you think about it, you could be expressing that to your boss and other people too. So, you know, there's no better way

you know, to be well thought of and remind people of all the good things you've done. So don't be too proud to let people know and that takes some thought. So, you know, think about, you know, what are you bringing to the business? The value you're creating for yourself and for the business.

So communication, inspire and influence team building and ris basically reflect upon yourself, your role in the business and stuff like that and things to make sure that as you grow in FPN A you are building on these four skills.

okay yeah that sounds quite interesting i mean i didn't think of the last one as much i think the last one comes quite naturally to me at least so for me i didn't think that but yeah that's that's a good one Well you know the problem for the last one for me is usually I'm going a hundred miles an hour straight ahead and sometimes you have to stop.

Take a breath and kind of look around. And that's where so it's probably more of a personal thing. How do that's, you know, a technique that what did I do this week that was valuable and uh and kind of do that'cause otherwise I just would

Just r run right by it and I don't know where I'd be in, you know, three years. No, no, that is that is definitely inspirational, man. I mean I think this is good experience to share. I am definitely actually I don't know about the listeners. I have picked up picked up a few things from this session today. so yeah i hope people who listen to this pick up a few things

and uh come back to CFO University to learn more and hopefully I will contribute a few articles myself this year. So touch road, let's keep it going. So thank you Tays. Uh what an honor to be one of your first guests on your new podcast and uh I really look forward to growing with you and look forward to get some of your pieces on CFO.university. I really look forward to collaborating a lot more with you this year, Steve. Lots. Really, really enjoyed this talk. Thanks a lot. Thank you so much.