A Career CFO

As Seen in CFO Studio Magazine Q2 2017 Issue

 

CHANGING INDUSTRIES CAN GIVE A CFO NEW PERSPECTIVE AND PROFESSIONAL GROWTH, SAYS ALISON CORNELL

The accepted wisdom is that CFOs tend to stay in one industry and build their success within that industry’s bounds, but Alison Cornell, who has navigated a career through telecom, health care, and specialty chemicals/consumer products, believes that “there is value created by moving between industries, not only for the CFO role that we perform, but also in developing a broad-based perspective that will be valuable in future Board of Directors participation.”

Ms. Cornell was the guest of honor at a recent CFO Studio Reception at the Governor Morris Hotel in Morristown, NJ. Andrew Zezas, publisher of CFO Studio magazine, introduced her to the assembled CFOs, noting that Cornell has shaped a nearly 30-year career in key global leadership roles in three different industries. She was profiled in the Q1 2017 cover story.

“We each set our own path,” Ms. Cornell began. “Some see limitless possibilities, others see limited possibilities… I’m in the limitless possibilities camp, believing that our financial skill set is fungible.” And so, she described five ingredients of a “winning formula” for a career path through successive industries, creating “a track record of consistently growing businesses, achieving sustainable results, attracting and developing talent, and taking businesses to new heights.”

The ingredients are: Be open to change; learn the business soup to nuts; make a difference while you’re there; be a positive and motivating force; and have the best team on the field. With regard to that last point, she said that when she arrived at Covance, a drug-development services organization where she worked from 2004–2015, she “changed about 75 percent of my direct- report team and built an awesome team that helped drive the business turnaround, sustainable growth, and the returns that we achieved.”

“Don’t pigeonhole yourself,” she said. “Don’t be afraid to fail.” (She’s not.) “Know what you’re passionate about.” (She does.) “And go there.” (She will.)

Culture Shift

As Seen in CFO Studio Magazine Q2 2017 Issue

 

UP-TO-DATE TOOLS AND WORK/LIFE BALANCE CAN RESULT IN A HIGH-PERFORMANCE TEAM

There are many ways to define and measure what constitutes a team that is lauded as “high performing,” but when you get right down to it, “it’s all about the people and the culture.” That’s according to Scott Settersten, CFO of Ulta Beauty, the largest beauty specialty retailer in the U.S., based in Bolingbrook, IL. “It’s not just about hitting your financial targets. If you have a team that is unhappy, or doesn’t interact well with business partners, simply making your numbers is not enough. It spans way beyond that.”

Mr. Settersten spoke on “Building and Sustaining a High-performance Finance Team” at an invitation-only dinner discussion attended by CFOs from Chicago-area world-class companies. The event was held recently at Morton’s The Steakhouse in Chicago, and is part of CFO Studio’s Executive Dinner Series.

“People need a good environment to work in,” said Mr. Settersten. “They need to feel empowered so that they develop good working relationships across the enterprise and can work effectively to help move the business forward.

“You are the leader,” he said to his fellow CFOs in the room. “You own the culture. If you want a high-performance team, it’s up to you to set the pace.”

What Each One Values

The first pace-setting step in building a top-notch financial team is never forgetting that your employees have a life outside of the office. “Work/life balance is one of the hottest employment issues today,” Mr. Settersten acknowledged. “It’s very important to be open and adaptive to new and different circumstances, and provide your group with a decent chance to achieve the balance they crave and deserve.”

He suggested “role-modeling” examples of work/life balance to demonstrate how “it can be achieved without sacrificing on-the-job duties and responsibilities.” This could come in the form of flexible hours or telecommuting options, he noted.

In addition, be aware of the generational gaps in the workforce, and be sure to adapt your style when appropriate. “Different folks or groups value different things.”

Invest in the tools that can help your team members blossom into high performers. “You owe it to them to provide best-in-class software tools” to help them become more efficient and effective. “Maybe it’s the latest tax software that makes the process easier, giving folks more time to think about the outcome rather than compiling all the data,” he offered. “This will go a long way toward making people feel like you’re investing in them, that you’re concerned about their happiness and job satisfaction, and that you’re providing an environment where they can make progress and excel in their roles.”

Continue to show you care about the human side of your team by encouraging opportunities for career development. “Invest in training for your people to improve their skill set, whether it’s a specific subject matter expertise, or just general communication or leadership skills,” Mr. Settersten advised.

In some cases, however, you may need to reassess your talent. “If you have four high performers and one weak one, the high performers are going to look to you to address the situation.” Mr. Settersten acknowledged these are tough calls and difficult discussions, but sometimes they’re necessary to allow the team to move ahead.

The creation of a “road map” can help. “Talk with your team, acknowledge what the gaps are, and develop a plan on how you’re going to ultimately reach your goal.” But don’t stop there. “Engage with them, be accessible, and become an active feedback loop for them.”

The notion of a “road map” resonated with CFO Studio Business Development Partner Marilyn Bird, District President at Robert Half, which provides specialized staffing services for temporary and permanent accounting, finance, and bookkeeping professionals. “Having a definition of what a high-performance team means to you can help determine your action items, as well as how you measure where you’re trying to take the team.”

Keep It Going

Once you’ve witnessed your team transformed into a well-oiled machine of high performers, “It’s up to you, as the leader, to stay committed to sustaining the positive momentum.” Mr. Settersten said it’s a constant cycle of measuring and revisiting; and no news is not necessarily good news. “Go out there and proactively seek feedback to determine if you’re still making progress and achieving success.”

And don’t be afraid to ask for help. “Financial leaders resist seeking assistance because we’re the ones that are supposed to have all the answers,” Mr. Settersten explained with a laugh. “We may just try working harder, but working harder at the same thing isn’t going to solve the issue. You have to think about doing it a different way.” He suggested looking into benchmarking avenues and peer-to-peer networking groups to generate ideas, see what others are doing, and to borrow any best-in-class practices that make sense for you. After all, “More brainpower naturally leads to better outcomes.”

In addition, continue to invest in your team’s success. “The finance function always tries to do more with less, striving to be the role model for fiscal prudence in the organization,” Mr. Settersten pointed out. “We’ll feed the rest of the business, but in our area of oversight, we’ll just make it work somehow, because there’s not enough to go around, and it’s better to invest in sectors that are going to drive the top line and result in the biggest payoff.” That mind-set will suck the life out of your high-performance team, he said. “Resist the inherent urge to pass over your department when it comes to investing in new tools, training, and career-development activities.”

Worth the Effort

Mr. Settersten admitted there’s a lot to consider when building and sustaining a high-performance team. “With so many areas of finance in the CFO’s purview, and with tax laws and the like in flux, it’s quite a challenge. You’re always trying to get better while attacking a moving target.” That said, “It keeps it very interesting!”

But at the end of the day, Mr. Settersten said that we are all looking for the same kinds of things: “We want good people who are motivated and care about the quality of their work. We want to be able to foster a positive working environment for our teams so that, together, we can focus on delivering great business outcomes.”

Leaps and Bounds

As Seen in CFO Studio Magazine Q2 2017 Issue

 

INSTINCT, FLEXIBILITY, AND PATIENCE ARE THE KEYS TO MANAGING HEAD-SPINNING GROWTH

When you’re dealing with a company that’s moving so fast you can’t even gather enough data to make an informed decision, you need to get very comfortable with your gut, according to Anthony Conte, CFO of EPAM Systems, a global provider of product-development and software-engineering solutions. The Newtown, PA–based company has been in a state of “hypergrowth” for the past decade, having grown at an average rate of 35 percent per year over the last 10 years, said Mr. Conte. “And in some years we grew as much as 50 percent.”

Mr. Conte spoke on “Re-engineering the Finance Function while Managing Hypergrowth” at an invitation-only dinner discussion attended by CFOs from Philadelphia and New Jersey–area middle market companies. The event was held recently at Morton’s The Steakhouse in Philadelphia and is part of CFO Studio’s Executive Dinner Series.

Mr. Conte explained that the term “hypergrowth” can be applied when “a company expands at an industry-exceeding rate — roughly 20-30 percent per year for an extended period of time.” In the case of EPAM, “We were a $70 million firm with a presence in five countries when we were preparing to go public 10 years ago. Today, we’re in 25 countries and generate $1.2 billion in annual revenue.”

This kind of accelerated growth is “dizzying,” he admitted, “not to mention incredibly stressful.” And it creates a lot of extra work. “It basically forces us, on a regular basis, to rethink and redefine how we do things.”

On the upside, there are many ways to not only “survive” this type of environment, but to excel at it, according to Mr. Conte, who then discussed what it takes to lead the finance team at a company that is growing like a weed.

Handling Hypergrowth

First and foremost, advised Mr. Conte, be very, very flexible. “As a company grows in scale, routine goes out the window. You have to accept that, and get used to working without a set procedure in place.”

He said this calls for a comprehensive change in approach. “As an accountant, you’re controlled and orderly, but in reality, when everything around you is moving so fast, you may need to think about different directions in which you might go to get the same result.”

In addition, your decision-making skills need to become more clinical. “You have to learn to make decisions based on very little information, and without the transparency and normal financial reporting that most companies would have,” Mr. Conte said.

This is particularly tough for “us finance types,” he said with a laugh. “We prefer to make decisions with as much data as we can get our hands on,” yet Mr. Conte pointed out that many of his moves are “gut reactions.”

Finance executives at rapidly growing companies “need to get comfortable dealing with the repercussions” of those quick decisions. “You need to be prepared that you’re going to be wrong a high percentage of the time,” he cautioned, “because when things move too fast, things get broken.”

Fix It Fast

Knowing that many decisions will be a bit off the mark, Mr. Conte continued, CFOs need to acquire an ability to take risks — and clean up after themselves. “You’re making a decision, and you know there’s a good chance you’ll be wrong, but you need to go with your gut, and then scramble to fix whatever went wrong.”

When something does go awry, “Don’t focus too much on the wrong or the ‘why.’ Figure out how to fix it, and move on.”

Mr. Conte said the emphasis must always be on propelling the business forward. “You want to learn from the past, but you don’t want to harp on the past.” He went on, “You want to understand why you made the wrong decision, and discover what you were missing so that you don’t repeat history, but you need to look forward,” because, as he pointed out, “the company is going to keep moving, regardless, so you need to patch things up and look ahead.”

“To a certain extent, you need to be MacGyver,” Mr. Conte said, recalling the 1980s television series about a secret agent who solved complex problems with the use of everyday objects. “You have to be able to take a rubber band, some duct tape, and a few pencils and build a support structure. And then continue to reinforce that structure as the company gets bigger and bigger.”

Keeping It All Together

When it becomes clear that a wrong turn has been made, “It’s critical to remain calm, cool, rational, and focused. And very, very patient with those around you.

“Everyone looks to the CFO to set the tone,” noted Mr. Conte. “Others follow my lead and react the way I do.”

That resonated with Matt Pantera, Partner at CFGI, a finance and accounting consulting firm with offices in Boston, New York, and Philadelphia, and a CFO Studio Business Development Partner. “So much falls to the CFO in terms of managing the challenges that come with hyper-expansion from both organic and inorganic growth.” He went on: “In the case of inorganic growth from an acquisition, it makes sense that a company with little or no trial balance or financial information is preferable in this environment, since there is less structure and process to be amended during integration.”

Mr. Conte acknowledged that his biggest challenge is controlling the company’s global transactional liquidity. To which Elaine Cheong, Senior Vice President of Global Commercial Banking at Bank of America Merrill Lynch, and a CFO Studio Business Development Partner, pointed out: “The ability to manage global cash efficiently can substantially reduce working capital needs and funding costs. When you have global liquidity flows, centralizing FX [foreign exchange] management can further minimize foreign currency risk exposures.”

Mr. Conte said that there are pros and cons to working at a company that is growing at the speed of sound, but he wouldn’t trade it for anything—not even for MacGyver’s prized Swiss Army knife.

Copyright 2017