PracticeAccounting FirmsInsider Business Club: moving from operations to strategy

Insider Business Club: moving from operations to strategy

Can finance directors become involved in strategy and fulfil the role of investors champions? Our experts discuss

Do recruiters see changes in what is required of FDs?

Keith Nash, Director of Human Resources, Badenoch &
Clark

Very much so. Working closely with FDs, I have seen how they got bogged down
with Sarbanes-Oxley compliance and other [regulatory] issues.

But I see this compliance focus easing, and more demand for the analytical,
forward thinking, strategic requirements back in businesses’ spotlight.

I don’t think there’s any ground lost by FDs, and I think the FD is a key
part of strategy at board or executive team level with a major part to play in
strategy.

[Those skills are] certainly now in greater demand, to have a more forward
looking aspect to shaping the business in their role, and making sure that the
business is on line to maximise shareholder value.

I think most businesses had to chase the skills they required for
Sarbanes-Oxley, but once those projects were over and the expertise is now in
place things have settled down. I think [strategy’s] back around the table [for
FDs] in the boardroom, back to where they were a couple of years ago.

Don’t FDs already use IT as an aid to making strategic decisions?

David Royle, Executive Consultant, Finance and Employee
Transformation, Capgemini

Well, it’s certainly not a done deal in terms of reducing their businesses’
transactional efforts, and a lot of organisations are still going through
significant pain implementing enterprise resource planning (ERP) systems, which
are complex programmes.

But those who are ahead of the field, and who have been through that pain
have established an ERP system and the effective systems around that, are now
asking the question, where do we go next?

There’s a tendency for the finance director to own the numbers at the
boardroom table, but having the right numbers is still an agenda all in itself.
I think it’s [still] quite a challenge.

Getting that infrastructure right; getting the right systems and the right
processes in place to give that reliability of data, means the FD doesn’t have
to defend the numbers or explain the variations and reconciliations between
different sources. Then they can start adding to the strategic debate.

How does the ICAEW ensure its qualification meets the changing
requirements of business and the profession?

Chris Jackson , Head of Finance and Management Faculty,
ICAEW

I see it almost like a pendulum; that if you go back a decade or so ago,
accountants were more like bean counters. Then they were told to get integrated;
become part of the team; start creating value. So everybody charges across to
the ‘value’ side of the business. Then along comes Enron and Sarbanes-Oxley, and
everybody says ‘get back to the other side; you were meant to be in control
here’.

What we don’t want is charging from one side of the boat to the other. We
need to get things on an even keel.

The real challenge for the FD and the whole finance team is to integrate both
those demands; the demand to create value and the demand to make sure that
everything is properly controlled.

That’s what shareholder value is about because the shareholder just wants to
make sure their money’s safe as well as it’s growing.

How can FDs enter into strategic debate with the MD or CEO?

Robert Bear, Executive Consultant, Capgemini

The big challenge for the finance director is to act as the conduit on top of
all the information received from business systems.

If they’re going to be allowed by the MD and other business managers to take
that debate, it’s how to translate those numbers to answer the decisions that
those business managers need. Then they can actually start really adding value,
but still making sure the numbers still reconcile.

Those within the business] want to know what the customer profitability is,
or what the lifetime value of the customer is, rather than just the profit of
all the organisation; so [the FD must] spin the numbers to them.

The challenge for FDs is to understand the language of the other business
managers and help support them by providing the numbers which help make them
make decisions. I think that’s the barrier.

Chaired by Kevin Reed

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www.insiderbusinessclub.com

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