Finance Directors: Leading lights not producers of pantomime

FDs are increasingly in the spotlight, centre stage and crucial to the performance. Finance is at the heart of the business and needs attention like never before.

There’s little doubt we’re living through exacting times and of all departments, Finance really does need to function. We’re witnessing unprecedented levels of interest in ‘the numbers’. Initiatives abound. Working capital improvement. Cost down. Restructuring. Reengineering. All have data requirements. All place extra burdens on Finance.

Great news if your systems and processes are up to it. Reliable data rolls off the system just when you need it. There’s plenty of time for insightful analysis. Everyone in the department knows their role and is highly motivated to provide what’s required. For others, on the other hand, the level of demand exposes issues masked in quieter days.

So pity those faltering with an unintelligible script, working with a hammy cast and unreliable backstage infrastructure. There’s some critical thinking to be done to avoid the descent into pantomime.

Here’s five points for the agenda.

1. Work the audience …
Frequently finance people fall victim of their ‘can do’ attitude. One consequence is a spiralling demand for data. It’s so much easier to fire in the questions than to provide the answers. “Could you provide sales by product by country every hour on the hour?” Even if this is possible, let’s ask ‘why?’. What actions will result from the analysis? What decisions will be enabled? If the response is always an unqualified yes the ripples are felt far and wide. Ultimately the flow of insightful data gets clogged by extranea. Sort out the heckles from the calls for more.

2. …and support the players
In particular, take time to critically assess the people at your disposal. It’s no time for passengers. But skimping on resource in the face of unprecedented demand is not an option either. Finance teams need their leaders to make canny use of their full-timers employees, contractors and, yes, consultants to respond effectively. This means developing a sixth sense for balancing demand and supply.

3. Follow the plot
This means having a grip on current reality and the desired future. Only snag is that ‘what should be done’ to address fundamental problems can get pushed aside in favour of what has to be done in the short term. And quite right too as finite resources are prioritised. It’s just that such firefighting is not sustainable. It is energising for a time but the working day can only get stretched so far. Process improvements, systems changes and good old-fashioned man management (e.g. effective delegation and personal development) have to take up the strain eventually. Striking the right balance is difficult but important.

4. Direct the action
If you lead with a light touch, now might be the time to direct. Not all people react to pressure with perfect prioritisation. Far from it. Scarce time can get squandered on irrelevancies as people retreat to comfort zones or simply lose focus. Managers need to do exactly that. People need attention and your intervention on a much more frequent basis. Lifting rocks and refocused effort are now almost daily requirements – businesses and therefore, finance can no longer wait weeks and months.

5. Stick to the script
Hard as the finance team works they’re unlikely to keep a lid on shortcomings in database and process design. Manual workarounds that suffice to meet isolated requests can crumple under pressure – more pace, more complexity, more flexibility. Teams can quickly get overloaded. Watch for demand switching from occasional to routine and ensure it moves to a production environment – controlled, documented, streamlined. If not you’ll find your analyst talent is bogged down in checking, reconciling and reporting. For ad hoc read ad lib. The best provide moments of genius but always risk distracting or even derailing the cast.

View this piece as a well-intentioned cry of “Behind you!” from the stalls. There’s no silver bullet. You can’t duck the detail and there’s much to work through and a balancing act between competing demands to perform. Get it right and the descent into pantomime is certainly avoidable.

If you’ve been affected by any of the observations in this article, please call our confidential helpline on t. +44 (0)780 8938213. (Actually this is just Simon Hill’s mobile)

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