Not only is the FD the de facto number two to the CEO, but many of the
competencies of the successful FD carry over to general management – a full
understanding of the business and the levers that drive the profits, thorough
commercial knowledge, good pragmatic judgement and an ability to assess and
manage the risk.
It’s not a bad start, but there are areas that need to be worked on.
Typically, they revolve around softer issues, such as getting the right culture,
recruiting, motivating and retaining a highly capable team of people that will
deliver the strategy. This is just as true for the head of finance who wishes to
remain in a functional role.
Surveys suggest that only 30% to 50% of senior team appointments are
successful. The main reason why success rates aren’t higher is due to a lack of
rigour in the selection process, over-reliance on interviews and CVs, and
superficial reference checks.
But recruiting the right people is just the starting point. Once appointed,
the organisation needs to develop and motivate them. This requires good process
support involving clear objective setting, objective appraisals and a management
development programme that is monitored and discussed by the board. Use of
mentors – whether internal or external – can be a really helpful part of the
individual development programme.
Effective organisations have excellent communication in both upward and
downward directions. This is time-consuming but essential. The lead for this
must come from the chief executive and his or her lieutenants.
Wise leaders are aware that the team must be more effective than the sum of
the parts. A mix of skill sets and personalities provides a richness of
diversity that enhances effectiveness. Different styles of management need to be
recognised and exploited.
Whether you are an FD aspiring to the top job or a head of finance looking to
add more value, releasing the talent of a motivated, informed and capable team
and the ability to live out actions according to the values of the organisation
Dr Neville Bain is chairman of Hogg Robinson plc and an adviser with
Boardroom Insight Visit
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