The CFO and Human Resources
CFOs are often reclusive and cautious, and HR avoids them in general and knows little about them. But HR isn’t going to be successful without being able to sell ideas to the CFO.
Why is the relationship with the CFO so important?
CFOs often have the final approval of HR projects.
They are a trusted advisor to the president.
They are often directly responsible for Human Resources and related areas like training.
C-Suite lines up like this:
CEO does “the vision thing.”
COO makes it happen.
CIO runs the metrics.
CFO is “Dr. No.”
Who Is the CFO?
Here are three examples to help HR understand CFOs:
The CFO is the only person in the C-Suite who brings lunch because it’s efficient.
If you ask the CFO whether the glass is half full or half empty, the CFO says, “It’s twice as big as needed.”
If you ask the CFO where he or she is going on vacation, the CFO will say “305.” (That’s the efficient way to say Disney; it’s Central Florida’s area code.)
On the job 4 to 6 years
Fired from last job—personality conflict with the CEO—and will probably be fired from their current job
Under pressure from every angle—new regulations, slow economy, tight banking
Embarrassed by Enron, Worldcom, Conseco, etc.
Today … CFOs Are Feeling the Heat
Before Sarbanes-Oxley, CFOs were generalist business partners, but new regulations are forcing CFOs to spend more time on compliance issues, leaving little time for strategy and new ideas.
In addition, new external pressures are forcing accountability on the organization.
Here are seven reasons it stinks to be a CFO in 2013:
New accounting rules—FASB, stock options.
Healthcare costs are out of control.
Every action is scrutinized for ethical lapses.
Managing technology dollars is tough.
Forecasting cash flow is tougher.
Data “stovepipes” are slowing commerce.
Frustration with people issues.
What the CEO Thinks About the CFO
“In which skills and qualities does your CFO excel?”
“Which skills and qualities does your CFO lack?”
People development skills
(from a CFO Magazine Survey of 500 CEOs)
Key Point: HR Can Help
All of the CEO’s gripes about CFOs are about issues that are part of HR’s core competencies,
The following is a list of characteristics of CFOs:
Very high learning index
Refine your picture of your CEO with two questions:
How much information does he or she want?
How much of a relationship does he or she want?
How much do you want me to keep you up to date on details?
How important is it that I help you gather, synthesize, and understand data?
To what extent do you want me to inform you about trends and new technologies?
To what extent do you want me to advise you?
How important are a mutually beneficial relationship and joint long-term goals?
You’ll find that most CFOs are either transaction-oriented or information-oriented.
Transaction-oriented CFOs are low information, low relationship. Most CFOs are this type. They think:
Price, Price, Price
Speed, Speed, Speed
Accuracy, Accuracy, Accuracy
“I just want good, fast, and cheap.” “We need it tomorrow by 4 p.m.” “The specs are.…” “I want to go out for competitive bid.” “I faxed you my order.”
Information-oriented CFOS are high information, low relationship. They:
Want you to keep them informed
Don’t necessarily want to be your friend
Love info on trends, big picture issues
“Here’s my e-mail. Keep me posted.”“I need to stay up-to-date.” “What’s the latest….?” “Give me the information; I’ll make the decision.” “My e-mail address is….”
Treat CFOs as they want to be treated. Most never want to be a partner. You do have a valuable, free gift for them—not wasting their time.