Although CFOs often hold the key to resources, acting as gatekeepers, they can also be critical allies in innovation, enabling programs and initiatives, according to an April 12 McKinsey report.
While innovation is often thought of in a traditional sense, with new offerings and services coming to mind, innovation can also mean disruption and change in business models, productivity improvements and new ways to service consumers. The CFO has the perspective to see where fresh ideas are needed in the business from a financial perspective, and the power to make them happen.
Innovation also requires resources and capital, of which the CFO has control and say as to how it gets used. The CFO is an important part of determining which innovations will go ahead and is akin to a venture capitalist, deciding whether to invest in a start-up.
As members of the C-suite, CFOs also have an important role in encouraging a culture of openness and innovation where staff members feel comfortable coming to company leaders with new ideas. By creating an atmosphere of innovation, the company can build a pipeline of innovative talent and concepts, which the CFO can help bring to fruition.
The past year and a half has brought prolonged hand-wringing from executives about whether working from home is sustainable over the long-term.
Perhaps no voice on the issue has been louder than that of Jamie Dimon, CEO of JPMorgan Chase, who is against working from home as a new standard.
Remote work, Dimon has said, could hurt company culture and prevent some employees from advancement, especially younger bankers who may lose out on mentorship and training opportunities.
Working from home “doesn’t work for those who want to hustle. It doesn’t work for spontaneous idea generation. It doesn’t work for culture,” Dimon said in May, according to Banking Dive.
David Solomon, CEO of Goldman Sachs, believes the same. Remotely onboarding new analysts is “an aberration that we are going to correct as quickly as possible,” he said in February. “For a business like ours, which is an innovative, collaborative apprenticeship culture, this is not ideal … and it’s not a new normal.”
The same sentiments have not held true on the finance side. CFO Dive has spoken with finance chiefs working at mid-size and large companies throughout the U.S., Canada and Oceania, who reported no problems with remote work, maintaining the trend has not materially impacted their bottom lines.
With the advent of technology that allows for bridging the gap between remote and in-person work, most agile companies, particularly those who invested in digital before the pandemic made it an imperative, the finance team’s ability to accomplish tasks has remained largely uncompromised.
Some CFOs have even said that the migration to digital-first has come as a welcome respite from unnecessary meetings or in-person commitments.
“I’m a convert to remote work,” Justin Coulombe, CFO of Momentive, formerly known as SurveyMonkey, said. “Pre-pandemic, I believed teams worked best in the office, but I’ve come to realize that point of view was more shaped by my preferences and leadership style [rather than] our team’s actual ability to work effectively.”
Flexible working arrangements bring great value to Coulombe’s finance team, which spans beyond the company’s traditional geographic hubs.
“My current working theory: generally, the teams that may find in-office work more effective are those with heavy business partnering roles, like procurement and FP&A,” he said. “We’re a service function, so many times we’ll align to where our partners are and how they work.”
The world’s largest brewery, AB InBev, which owns Corona, Modelo, Stella Artois and Budweiser, currently operates in a flexible hybrid environment, its CFO, Fernando Tennenbaum, said, but he sees pros and cons to all approaches.
“Probably, in the future, there will be some combination of remote and in-person work,” he said. “Definitely, sometimes meeting in person is valuable, but it’s also possible to work remotely.”
At the start of the pandemic, when AB InBev was forced to close the books remotely for the first time, Tennenbaum was worried about everything coming together. But because his team paid a great deal of attention to the quarterly close process, on account of it being the first time they’d done it, everything went smoothly, which he took as “a great sign.”
Even so, Tennenbaum wouldn’t be able to pinpoint one role over another that would be best suited to return to in-person work permanently. “It’s more about maintaining people’s interactions than about any specific task,” he said.
“If anything, the pandemic proved remote work is essentially just as good as in-person; all jobs got done on time without sacrificing quality,” Kirsty Godfrey-Billy, CFO of New Zealand-based cloud accounting company Xero said. “Cloud accounting [allows for] pretty much all finance-related tasks to be done anywhere, anytime on a single, up-to-date general ledger.”
But in order to keep evolving and thriving as a profession, accountants must truly embrace technology and the changes that come with it, Godfrey-Billy added.
Laura Mineo says the longtime-distributed workforce at Rokt, an ecommerce tech company where she is CFO, positioned it well for the hybrid mode it currently uses.
“In my view, the importance of in-person work isn’t necessarily related to completing certain tasks, but to everything that surrounds those tasks and allows us to complete them more effectively and efficiently as we scale,” she said. “Things like knowledge sharing across functions, onboarding new employees, supporting other departments throughout our organization and maintaining the apprenticeship culture we prioritize are all easier and more effective in person.”
Marten Abrahamsen, CFO of financial services platform Fundbox, agrees. “As a whole, our finance team functions very well remotely,” he said.
However, Abrahamsen, who joined Fundbox weeks before the pandemic, has found the company’s strategic finance and corporate development teams stand to benefit most from in-person collaboration and discussion.
“These teams, in particular, engage in frequent white boarding sessions and healthy, back-and-forth debates that are best done in person,” he said.
Vanessa Kanu joined Canadian telecom giant TELUS International as CFO one year ago. In that time, completely virtually, TELUS pulled off the largest technology IPO in the history of the Toronto Stock Exchange, participated in investor roadshows and hosted its first two earnings calls.
She credits the company’s carrier-grade infrastructure, backed by cloud technologies, with allowing her and her team to simulate an in-office experience from home.
“That said, I do believe in-person meetings and events are valuable and offer unique moments for team-building and establishing more personal connections,” Kanu added. “Those interactions are especially helpful for new team member onboarding, training, and reinforcing a company’s culture.”
In theory, the idea of salaried compensation for employed physicians makes a lot of sense. For one thing, it’s blessedly simple, with the potential to remove the tensions that arise in shifting to value-based payment or implementing lower-cost (but lower-reimbursement) care models like telemedicine.
However, medical group leaders have long feared that productivity would tank if doctors were put on salary. (As a consulting colleague said recently, the switch to salary would cause a 20+ percent drop in productivity in the medical group, creating a challenge akin to keeping an airline profitable after removing a quarter of the seats on its planes). We’ve been expecting that more doctors might seek stable compensation models in the wake of the pandemic, and so weren’t entirely surprised when the question of moving to straight salary came up in three conversations over the past two weeks.
In all three cases, leaders are hoping to create more predictability, and to decrease the resources and effort needed to execute against a menu of complex plans. They believe that a move to salary is inevitable, and their questions have more to do with timing.
Gauging when to make the move should be determined not by external market shifts, but by internal cultural and operational readiness. Are the systems in place to enable doctors to work at a high level of efficiency? And do we have the group collaboration needed to maintain high performance without paying doctors as if they are salesmen on commission?
Another wrinkle has popped up for groups who might be ready now: the past year has upended the benchmarks that groups might otherwise use to inform decisions on where to set salaries. Nevertheless, over time we expect more groups to move in this direction, with the hope of getting off the “hamster wheel” of compensation committee meetings and ever more exotic permutations of bonus plans, in search of a more stable model.