THE CFOs .. the new challenge is the growth

From 2008 the world ( and mainly the developed countries ) started to suffer an  economic crisis. As a consequence, the  sales for most companies based in developed countries have decreased, the sales expectations done before 2010 for the period 2010-2015  did not meet the targets, mainly because China or India did not buy the expected product amounts and most companies have concentrated in cost reductions and not in growth. 

In these tough conditions, some CFOs have became CEOs because the cost reduction have become the priority for some companies and the profile of some new CFOs is reducing its accounting part and increasing  its cost reduction part. 

Today some books as "Winning CFOS" from David Parmentier or "The new CFOs: How finantial teams and their leaders can revolutionize modern business" from Liz Merlon are explaning very clearly why the new CFOs has to be more strategist today. In an exceptional prologue, Liz Merlon states that the three main qualities of a CFO are:

1) An  unquencheable curiosity to know and understand the company, the processes, the business and the people

2) An ability to relate to people.., not a friendly relationship, but a business relatioship. It is vital for the CFO to become a person that  all key pople in the company  trust and respect.

3) A strenght of character.. to say the unsayable and commmunicate the bad news. If the CFO has the ability to relate to people, people will listen and accept easier his / her statements.

The CFO has to put in place all controls to avoid all kind of risk. What does it mean?.. The company should have robust controls, a good risk management system and additionally he should consider the financial and accounting activities as processes, then the CFO should get dirty his / her hands in process redesign maintaining the quality but reducing the cost. 

 If we consider the company as a  car, the CFO has to install and maintain the brakes in order that the car can go to the highest speed without risk. And what is the speed?.. yes, the growth.

What have done the CFOs to increase or keep the growth?.. Probably nothing or very little. That surprises a little, because most lecturers says that the new CFOs have to be more strategists. 

This winter I went to a ski  resort and I saw that in a rope tow, the assistant had a recorded with a very loud music. The waiting queue was very long because that was the only tow or lift chair close. I realised the ambiance of fun that the music was giving and I thought that there a bar could increase the sales for the ski resort and the waiting time in the rope tow should be smaller.. but quickly  I thought as well that  probably the ski resort  had a CFO very orientated to cost reductions  and he  was not able to  see  this possibility of growth.  

Sometimes cost reductions can be incompatible with growth, then the new CFOs needs to have a right balance to identify which expenses  brings growth and which  expenses can be reduced or eliminated, because they do not bring growth.  That is the real value that  the CFOs could give their companies the nex decade. 

A BEAUTIFUL MIND - TWO LESSONS

In 2001, the film " A beatiful mind" about  the life of John Forbes Nash won the Oscar. And who is John Forbes Nash?. He  invented the games theory and he won the Nobel Prize of  Economy in 1994. His theories have   influenced the economy, the commercial negotiations, the biology and the psychology. 

I am writing this post to  comment  two propositions based  in his life and theories:

1) The cooperation always gets better results than the competence between people / teams / companies. 

In a film scene,  several friends watching a group of girls discuss about what to do to avoid sleeping alone. Some of them suggest, following the theories of Adam Smith, to compete between them to get the most beautiful girl in the group. John Nash says that if they do that, only one (or none) will get the most beautiful girl. 

What about the others?. The others will not get nothing, because the other girls will not be very happy to have been left as second option and they will leave. 

Maybe it is not a work academic example, but it is an  example that allow us to understand easily  that the cooperation always gets better results than the competence.

2) Understanding and improving how or our mind works  will make supernatural  our work performance and our personal developement

At the age of 30, John Nash spent  15 year in different hospitals with schizophrenia. He was convinced that spies  were following him and aliens were communicating with him using  encrypted messages in The New York Times. After these 15 years, he miraculously recovered one day starting to speak normally. And  after he started to   give classes again. His wife said that he did not recovered by any medicine or treatment, only a quiet life  recovered him. And why  he believed all these completely unreal thoughts?. He said that he believed them because they came in the same way that its usual thoughts.

John Nash believes deeeply, as well,  that in a stress situation, the schizophrenia thoughts can be a way that the mind escapes from the problem. At lower level level, we all know people that did not react or think in the same way after a divorce, a death of a close familiar, a cancer or other difficult situation. In some cases, the abnormal reactions did not last too much but in some cases, it  became a problem for all life... I honestly think that some problems at work considered attitude problems can be determined by  personal situations and a recipe based only in the symptoms will not produce any positive result. As example,  to impose more discipline to someone affected by the death of a close familiar that behaves strangely only  will become the problem bigger... 

I do not think that the work of our companies is to take care of our mental health, but it is in its interest that they  take care about our mind, because if not, the productivity loss can be very high.  I am  very convinced that some expertise in Pshycology  in Human Resources Departments (and in some managers) can make a real difference in much more less time...finding quickly the clue and the solution...... and  if not,  we have always the solution of a quiet life (as John Nash), but I am not sure that  we (and our companies, families and friends) would like to wait for us 15 years!