Six Lessons for the First 100 Days
New finance execs must move swiftly to learn the ropes, set the pace.
by Rick Telberg/For the Finance Executive
Finance executives are increasingly finding themselves in the middle of corporate decision making and responsibility. For newly appointed CFOs and finance managers, success is no small feat-the first 100 days are critical.
With the pressure on, new finance managers want to make their mark early, and, according to the McKinsey Quarterly survey by global management consulting firm McKinsey & Company, there are some activities that should make nearly every finance executive’s short list of priorities.
One of the most critical activities during an executive’s first 100 days is the gaining of and understanding of what drives his or her company’s business, whether it be how a company makes money or its returns on invested capital. At the same time, a CFO must also consider potential ways to improve such drivers.
In the survey, McKinsey asked established executives about their first 100 days on the job, their successes, failures and lessons learned.
Lesson No. 1: Get to know the business units. Make them part of a strategy and value audit by meeting with business unit leaders for information on product lines and markets.
Lesson No. 2: Talk with customers, investors and the company’s professional services providers for external perspectives.
Lesson No. 3: Understand what your CEO wants from you. Nearly four-fifths of the finance executives in the survey said that their CEOs expected them to serve as active members of the senior management team, contribute to the company’s performance and make the finance organization efficient.
Lesson No. 4: Know your team. It is also critical that CFOs strengthen the core finance team and establish a well-functioning finance department, because having disparate systems and processes or unwieldy organizational structures can hamper a company’s performance.
According to those surveyed, during the first 100 days about three-quarters of the new finance executives initiated, or developed a plan to initiate, changes in the department’s core activities. In their reviews, for example, finance executives assessed the reporting structure, evaluated the fit and capabilities of the finance staffers and identified any inefficiencies in the key systems.
The results: Finance executives could gauge how much energy they would need to invest in the finance organization during their first six to 12 months in their role and fix any problems that arise.
Furthermore, those finance executives who joined a company during or just after a turnaround are more likely to have been required to put in place a formal plan of action.
Lesson No. 5: Get a mentor. You’ll need a sounding board. Many finance executives-32 percent, to be precise-said they didn’t have a mentor. And 46 percent said that the CEO was their mentor. While having the guidance of the CEO is undoubtedly helpful, many respondents said it was difficult discussing some of the challenges with the boss. Newly appointed CFOs may want to consider joining roundtables or other forums to build networks and share ideas.
Lesson No. 6: Stay focused. McKinsey suggests that newly appointed finance executives supplement their day-to-day activities with no more than three or four major change initiatives. Remain focused on those initiatives and repeat the message over and over-internally to staff and externally to stakeholders.
There’s no doubt that, for a newly appointed finance executive, winning the support and respect from other corporate officers doesn’t always happen overnight, but being able to understand where value is created and to develop a strategy for influencing ongoing performance management will put you on the road to success.
COMMENTS: Rants, raves, idle thoughts or questions? Contact Rick Telberg.
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