A third pressure holding CFOs back in their quest to be strategists is what David Yeung, a Beijing-based partner at executive search firm Heidrick & Struggles, calls “time crunch.” He notes that the scope of many CFOs’ jobs has increased in recent years to include the supervision of functions such as IT, real estate, and purchasing.
“Possibly it’s because companies are trying to cut costs, or possibly it’s because they feel finance will bring better discipline and control,” he speculates. “Either way the role of the CFO is being expanded and that gives them less time to spend working as advisors to the firm’s front-line managers.”
Behold the Bigger Picture
Still, the picture isn’t all doom and gloom. In many cases, CFOs are managing quite successfully to embrace a more strategic position. Take Seck Wai Kwong, the CFO of Singapore Exchange. As well as running the finance department of the S$275 million-a-year ($167 million) stock and derivatives market, Seck is also in charge of the company’s strategy and business development.
“Increasingly, the finance function takes care of itself,” says Seck. “It has a set of processes, like the monthly close, that is designed to run like clockwork and it does. I encourage the team to continually improve their processes, but that doesn’t really take much of my time.”
Instead, Seck sees the role of the CFO as being much more a “chief focus officer”. The former fund manager and investment banker — who has an economics degree in place of an accounting background — believes it’s his job to help his company define its strategic objectives and then show them how to focus on achieving those objectives.
“There are always so many things going on in any organization that it’s sometimes difficult to see what’s important, to see what are the drivers of revenue, of cost, the drivers of creating value,” Seck stresses. “I believe it’s the job of the CFO to bring that clarity, to bring focus.”
Another CFO who has risen above his traditional role is Colin Sampson, Asia Pacific CFO of SAP, the €7.5 billion-a-year ($9.3 billion) German software giant. Sampson took on the regional finance role back in 1998 and spent much of his time building SAP’s first shared services center, a model now being rolled out by SAP in Europe and Latin America following the successful launch in Asia.
In January 2005 Sampson’s role was expanded and he was made the company’s regional chief operating officer as well as its CFO. Now, on top of managing the firm’s finances and corporate governance, he looks after its sales operations, facilities management, legal team, and human resources too. From this position of power, Sampson has ensured that his finance staff are able to play a much more strategic role than in the past.
For example, when it comes to business planning, Sampson has brought together the company’s business development team, its sales team, and its finance team and integrated all three into one operation. Together, these multi-disciplinary units come up with “go-to-market” strategies for SAP’s various products in different countries and for different segments within those markets.