It is eighteen months since Max Brown was appointed Head of Finance Transformation of CG Logistics to lead the redesign of the company’s finance function, optimization of finance end-to-end processes, and ultimately drive finance effectiveness company wide.
Prior to being promoted to this newly created role, Max was the Senior Finance Manager – Automobile Division overseeing all aspects of the division’s financial administration, revenue analysis and cost management, budgeting and forecasting, and the preparation of quarterly and annual financial statements.
Given his solid finance experience, significant successes in the past, familiarity with the organization’s structure and culture, and their productive working relationship for the past five years, Debbie Skins, CFO of CG Logistics, was easily convinced that Max was the right candidate to lead the company’s finance transformation agenda.
For Max, this was a big opportunity to bring about the required transformational changes, add value to the business, cement his credibility, and rise in the organization. Unfortunately, since his appointment, not much has changed within the finance function other than the addition of a new cloud-based FP&A system.
Team members are still spending more time on transactional processes versus analytical work and business support. Finance processes are still heavily manual. The function is still replete with non-standard and ad hoc reporting. Management reporting, which most of the time is delivered late, is mainly focused on what happened versus why it happened, how, and what could happen in the future.
Even though Debbie and Max meet regularly to discuss expectations and progress, she is concerned that despite repeated promises from him to course-correct plus her offering him plenty opportunities to redeem himself by form of results, the gap between actual versus desired results continues to widen.
After being in denial for a while, she has finally accepted the fact that Max is not the right candidate to continue in this role. “If the desired results are to be achieved sooner rather than later, we have to take immediate action and replace Max with the right candidate experienced in delivering finance transformation,” she has raised her concerns to Andrew Wilsons, the CEO of CG Logistics who gives her the go ahead to deliver the damning news to Max.
Considering his outstanding record, intelligence, focus, and determination, being let go for not producing the expected results has become Max ‘s worst career nightmare. Never in his career lifetime has he ever been fired for underperformance. In fact, he was head hunted for his first role with CG Logistics.
Instead of wallowing in self pity, play the blame game, and allow this temporary setback to detour his career ambitions, he chooses to learn from this recent setback and not allow his past successes act as a learning stumbling block.
He recalls the wise words of Tim (his mentor), “At some point in your career, you’re definitely going to receive heavy blows and get knocked down but what matters most is how you respond and forge ahead. Don’t be scared or become a know-it-all person. Rather keep your integrity and professionalism in check at all times and embrace a continuous learning and improvement attitude.”
Feeling a bit overwhelmed, he calls Tim. “We need to urgently meet and talk” Max says very directly. “Is everything okay?” Tim asked with a concerned tone. “No, I have just been fired” Max says sternly. “Let’s meet tomorrow at our usual coffee shop, same time” Tim responds.
Always time conscious, Max arrives at the coffee shop fifteen minutes early ahead of the scheduled time, somewhat looking defeated, and sits down like a punctured tire. Only him can attest what was going through his mind at that point. Within a few minutes, Tim arrives sharply dressed in a sky-blue, slim-fit suit and straight-ironed white cotton shirt.
“As you are aware, I was promoted to lead the finance transformation agenda for my previous company. I implemented a new financial planning and analysis tool and even reduced headcount, but this wasn’t enough in the eyes of my bosses. Now they have let me go for underperformance.” Max narrated to Tim.
“I’m sorry Max, we will get to the bottom of this and help you get up and running again.” First, did you understand what the company is trying to achieve and how your role fitted in?” Tim politely asked.
“Yes, Debbie explained to me what the transformation agenda was. We had periodic performance check-ins. Also, she regularly shared with me feedback from business partners or concerns raised during SMT meetings regarding finance function performance.” Max went on and shared more details.
Looking deep in thought, Tim asked another question “Apart from meeting with your boss including what you’ve already told me, what else did you do?” “You see Max, understanding current reality is very critical. You need to be involved. From the information you have shared so far, I gather you had limited understanding of what the role entails, and rarely met with your stakeholders to discuss and understand their challenges and opportunities.”
Max’s eyes and ears suddenly became intently focused on Tim. “This lack of understanding of the organization’s current reality, unfortunately, caused you to implement quick, superficial solutions that failed to deliver the transformation agenda.” “You are not the first one to fall into this trap.” Tim added. “Finance transformation is a way of thinking. It is a journey that is never-ending.”
“You mentioned you successfully implemented a new system and reduced headcount?” “Yes, I did.” Max responded with a faint voice. “Okay, now tell me what are some of the concerns that were raised by your stakeholders?” Tim further asked. “Well, some complained of untimely reporting while others complained of limited forward-looking insights but more of historical reporting.”
“So then, how did the new system and reduced headcount address these concerns?” Max didn’t answer but slowly nodded as though he had figured something out.
Tim took a deep breath, sipped his favorite iced coffee, and continued the conversation. “Before embarking on the finance transformation journey, as a leader you must be able to determine and tell where the organization is right now.” Max decided to ask a question of his own. “Why is this so important?” Tim sensed that something seemed to be sinking in Max now, so he responded politely.
“This is important for building a roadmap and ensuring appropriate amount of time and resources are devoted to the transformation. Taking time to know and understand current reality helps you assess whether transformation objectives are being met or not, learn from successes and failures, and focus on what matters. Remember, transformation has no end, there will always be a gap between where the finance function is (current state) and where it would like to be (ideal state). Therefore, there will always be opportunities to improve.”
“If only I had received this advice earlier on, I would still have my job today.” Max remarked. Tim just smiled. “You are going to be fine.” “What else should I have done differently?” Max asked. “Look Max, I am going to be blunt with you on this one. Please don’t be offended. It’s the honest advice anyone is ever going to give you and I’d rather be that one guy in your boxing corner instead of misleading you.”
Seemingly confused with what he had just heard, Max shrugged and half-nodded.
“In your previous roles, you have done very well because of your strong technical skills and incredible attention to detail. These are great tools to have in your toolbox but as for the most recent role, these strengths alone are insufficient.” “Really?” Max seemed surprised. “Tell me about it.”
“Of course.” “Finance transformation is cross-functional requiring input from both internal and external stakeholders on the function’s performance and how it can improve. Thus, each transformation leader must be able to collaborate across the organization and create change instead of maintaining the status quo.”
Max interrupted. “Oh, I get it now. An effective leader changes things, moves them forward, and produces different results than those previously achieved. They don’t do it alone but surround themselves with capable team members. Now I understand why earlier on you mentioned functional expertise alone is not enough.
“Go ahead,” Tim encouraged him. “As I’m reflecting now, I’m starting to notice how I failed to make the leap from being a strong functional performer to taking on the cross-functional role. I focused more on technicalities and kept doing what I was accustomed to. By sticking with the past and not fully embracing my new role, I blew a big opportunity to shine. Surely, it’s time to add business knowledge, strong leadership, communication, collaboration, and influencing skills to my tools kit.”
All this time Max was talking, Tim couldn’t stop nodding in agreement. He shifted in his chair and leaned forward. “Listen Max, I’m glad our meeting has been fruitful, now you get it. I have no doubt in mind you are definitely going to bounce back stronger.” Max felt Tim’s approval and calmly responded. “Thank you Sir.” At this point he looked more relaxed and victorious than he was an hour or so ago when he arrived at the coffee shop.
“Sure, that brings us to the last point of our discussion.” “Finance Transformation is more than simply implementing new systems. Earlier on, you mentioned the various industry events you attended soon after your promotion. One that you spoke a bit more about is Finance Reimagined which you highlighted is one of the biggest annual conferences for Finance professionals bringing together thousands of peers, specialists, banks, technology suppliers, platforms, CFOs, and thought leaders.”
Tim paused, took a deep breath, looked at his watch, and leaned back in his seat. “Just like you, I enjoy attending such events as they present an opportunity to learn more about best practices, new technologies, and emerging risks and opportunities. However, sometimes I get the sense that some of these events are more about tech companies promoting their new shiny tools and less about learning.”
As a result, leaders end up instantaneously making critical investment decisions from simply witnessing a demo.” Max nodded and asked his final question for the day. “So, if finance transformation is not about technology alone, what then are the other critical success factors?”
Tim smiled before responding. “After seeing countless demos of different FP&A tools at Finance Reimagined, suddenly, you were fully convinced that a specialized planning and BI tool was the key transformation ingredient missing at your company hence the quick deployment. Although technology is a key enabler of efficiencies, it is only one piece of the puzzle. People, processes, and the organization are equally important ingredients.”
Max thought about it for a few seconds, then allowed Tim to continue. “You need the right people with the right skills to use the new technology. If the process is broken and not fixed, no shiny piece of technology can fix that. If the organization or culture is not aligned to what the company is trying to achieve (understanding of purpose), technology alone will not bring about the desired results. Beliefs drive behaviors, behaviors drive actions, and actions produce results.”
Tim paused, but only for a moment to let Max digest the message.
“That’s it for today. Always remember finance transformation is about continuing on a never-ending path towards improvement and not a series of one-time improvement efforts or projects. Mistakes are bound to happen and when they do occur, reflect, learn, unlearn, and continue the journey.”
And so, the meeting ends. Max firmly shakes Tim’s hand and thanks him for his mentorship. As the two men part ways heading in different directions, Max’s confidence was rejuvenated, prepared to face the next challenge.