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CFO Leadership in a
Kaleidoscopic World
The complexity, the nature of change, and the scale
and speed of running large business enterprises present extraordinary demands on organizations
and the individuals who work within them. While this challenge is broadly acknowledged, what
is less recognized is how these same challenges are different – perhaps unique – when
faced by those at the top. In this article we describe what C-Suite executives face – what
we call the C-Scope Challenge – and the particular impact this is having on today’s
CFO.
The level of leadership perspective, scope, and integration required at the top demands
enormous capacity and depth of individual talent. And it is more than any one person alone
can humanly manage. If for no other reason, the overwhelming scale and complexity of today’s
business organization demands that individual leaders function together as a tightly woven,
high performing Team at the Top. Similarly, it is not sufficient for today’s C-Suite
executives to manage their own functions separately, no matter how well this is done. Each
must also design and manage their organizations to address the pressures of integration and
complexity that ultimately converge at the top.
Nowhere is this phenomenon more clearly illustrated today than in the role of the Chief
Financial Officer. The Clarion Group was recently asked by the CFO of a leading technology
firm to benchmark Best Practices Finance organizations in leading edge multinational companies.
These findings, combined with our knowledge from working with Teams at the Top, enabled
us to recognize fundamental links between the two. Perhaps more than any other part of
the organization, Finance is called upon to help address the C-Scope challenge. Understanding
this goes a long way to explain the evolution of Finance over the past decade. Best Practices
firms reveal trends reaching deep into their Finance organizations that are a direct reflection
of the unique C-Scope Challenge faced at the top.
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The C-Scope Challenge
Expansive breadth of scope, overwhelming complexity, organizational transformations, and
shifting paradigms permeate the C- Scope Challenge. All efforts to describe it must be simplifications.
Here is one: very basically, it all comes together at the top. Someone, somehow must make
sense of all the discrete, disparate, even conflicting sources and types of data, identify
what is relevant to the business, focus on what is critical to future success, and weave
it all into one strategically unifying message that is simple and clear enough to manage
and monitor all the various parts and keep the whole of the enterprise in alignment. All
in a way that increases shareholder value. And which changes, by the way, overnight, every
night.
Here is another: a metaphor, that of looking through a kaleidoscope where new patterns
of colors and shapes are created with each turn of the wrist. In a kaleidoscope there is
only one layer of colored glass reflected between mirrors. But the kaleidoscope through which
a CEO, COO, or CFO looks each day has many layers and thousands of bits of rotating colored
glass. Each layer represents a different aspect of the business: a new market, a different
product, a competitor, a regulation, an investor, a department, an organizational structure,
a customer, distributor, etc. – all the various stakeholders, all the way through the
value chain. And every time even one of those layers rotates even a fraction of an inch,
a new pattern is reflected all the way back through the whole of the value chain, creating
a new combination of colors and shapes. Each creates a new business environment, and some
(too many it seems) require a new business model.
The higher one ascends toward the top, the longer the kaleidoscope with more layers to see
through. At a certain point of complexity, it is not enough to just see farther, linearly;
one must develop a different capacity for seeing altogether. Think of it this way: it takes
a strong, clear light to see each layer for itself, and also see through all the layers,
without getting stuck in, or distorted by one layer alone. Of course you cannot ignore the
individual bits, the individual layers, but the emphasis here is increasingly on the intersection,
the alignment, the patterns, the connections between the layers.
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