Wednesday May 08, 2013

The CFO as Catalyst for Change - Part 1

In today’s hyper-competitive global economy, senior executives often have to wear more than one hat to help their organizations reach their full potential.   A good example is the CFO. With the constant need to drive innovation and growth, coupled with their more traditional financial responsibilities like managing costs, CFOs are under increasing pressure to take on an even broader role within their organizations. This evolving role has seen CFOs become more valued strategic and commercial partners, but has not reduced the challenges they face. From working with customers in nearly every industry and geography, a few of the challenges CFOs currently face have become clear, including:


  • The operating environment – While the economy is recovering, CFOs are still facing a low-growth external environment. The need to focus on cost management and efficiency has, in many cases, meant the difference between survival and extinction. Yet, the CFO’s role has broadened to include playing a greater role in technology and operations. Therefore, lack of time and role overstretch are key problems.

  • Skills and capabilities – As the role of the CFO expands, so must the CFO skill set. This has presented a problem for organizations with finding the right talent and capabilities that move beyond the traditional finance skills. Current CFOs also need to expand their own capabilities – particularly with technology. 

  • Technology – The CFO's role in IT investment is more apparent than ever. According to Gartner, 45 percent of IT leaders report to the CFO…that’s more than report to any other executive. While technological innovation such as big data, business analytics, cloud, mobile and social are a priority for the majority of organizations, most financial executives are unable to evaluate IT investments, making it harder for them to show the fruits of their labors. 

Despite these challenges, I know many CFOs that are taking a more strategic role, but they are also the first to admit that there is more work to be done. Over the next few months we will explore this topic in more depth and discuss how technology and other factors can help CFOs become catalysts for change and unlock the true potential within organizations around the world.

For more information about the role of the CFO and best practices in dealing with today's Finance challenges, check out Oracle CFO Central at www.oracle.com/cfo.







Gaining Strategic Alignment with Business Scorecards

Recently, I had the pleasure of interviewing Mr. Trey Robbins, Managing Director for Technolab, a Platinum Oracle Partner, for a Podcast. Trey and I discussed the implementation of Oracle Scorecard and Strategy Management (OSSM) at Technolab, and the important results they have achieved.

Trey told our listeners that Techolab wanted to translate their Balanced Scorecard framework into an online tool so that they could align their corporation in all the countries and hold people more accountable for achieving goals and corporate strategy. Managers update their measures and part of the corporate strategy manually, and then meet on a quarterly basis virtually (via phone and webcast) and in person on an annual basis. They walk through the overall corporate objectives and how they are tracking including the budgets and targets they have set.

In addition to strategic alignment, Technolab is also experiencing operational and financial benefits from OSSM. Trey told us that when he was first hired at Technolab, he saw lots of good ideas from the company brought forward in meetings and brainstorming sessions, but after the meetings were over and everyone went back to their day to day activities, the great ideas were lost. By using the scorecard tool, they document the good ideas, assign responsibility and track their progress.

An example of an operational improvement that Trey described was tracking the compliance of the entire organization around certifications that their consultants need to have for implementing software for their customers. Certification and re-certification for each region of Technolab is extremely important to the company, but difficult to monitor. Technolab now has software certification as an objective for each region and country and the company expects to see green lights on this objective at each meeting, or have a really good explanation of why they don’t. “When you go in front of your peers and management and you have certain things that you are responsible for, you are going to make sure you are executing on those. You don’t want to go into your meeting unprepared, and you definitely don’t want to go into your meeting with a bunch of red traffic lights,”said Trey.

When asked about some of the lessons learned from the initial implementation, Trey had some good advice. 

    
 1. Understand all the components needed to track strategy, measures and activities before using a tool. If you jump straight into the software, you will be missing components and that will slow you down. Understanding everything your organization wants to track and everything that your scorecard tool needs will enable you to speed through implementation.

     2. At the beginning of implementation, hold executive status meetings on a monthly basis rather than quarterly. The more visibility you have, the more consistent the message you articulate, the easier it is to execute.

    
3. Leverage the use of mobile capabilities more. Enable the executives to review the status of objectives and activities frequently and ‘on-the-go’.

Implementing Oracle Scorecard and Strategy Management (OSSM) gave Technolab a better way to manage their international business activities, align everyone around the corporate strategy and move the entire company towards achieving that strategy.

To hear the entire Podcast click here.

For more information about Oracle Scorecard and Strategy Management (OSSM) click here.


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This blog will highlight key EPM market trends, recent events and other news of interest to our field, customers and partners.

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