Moderated by Emily ,Digital Transformation Consultant at Hyperbots
Emily: Hi everyone, this is Emily, a Digital Transformation Consultant at Hyperbots. But today’s discussion, I’m pleased to have John Silverstein on the call with me. John is the CEO at Liv Data LLC, and today we’d be talking about how finance controllers can become good CFOs. But before that, John, do you mind telling us a little more about yourself?
John: Sure, thanks Emily. I’ll tell you a little bit more about LiveData, what I’m doing here as a CEO. So we’re going in and advising and consulting our CFO, alcohol candidates and going in and really advising them on how to go about their technology, people and processes and making sure that they’re making informed decisions through their data.
Emily: Thank you so much for that introduction, John. So just to kick things off, what are some of the key CFO skills that are required in the current times and how has it changed over the last decade in terms of the evolving role of a CFO?
John: Yeah, I’ll answer that first. The CFO was really looking at the past, doing some basic forecasting and budgeting and things like that. But it was just strictly the numbers and things like that and just trying to take past trends and things and try to predict what the future is in some cases. But really it was compliance, it was tax compliance, it was things like that. Now it’s a whole new animal in the sense that we have to know exactly what’s going on from the top line to bottom and then what the levers are in the business, how to operate the business, how to go about marketing sales initiatives. Should we do them? Should we not do them? We’re making decisions on the right hand side or informing the other CXO members or CEOs and things and management team to say, you should invest or you shouldn’t invest or we need to pull the brakes or we need to put our foot on the gas pedal. So we’re doing a lot of advisory work as a CFO. We’re that right hand and we have to understand not just bookkeeping the county and the rules behind that, but we have to understand the business inside now from top line all the way to the bottom line. We got it understood.
Emily: So what leadership qualities do you believe are essential for a successful CFO that might not be as critical in a controller role per se?
John: Yeah, the critical role is you have to be able to work in every department. A CFO is going to have to make decisions regarding HR hiring layoffs potentially change transformation initiatives where you might be implementing new technology that might change people’s jobs and processes and things. You also may be making decisions on sales, whether to go to certain events or go, how you go to market and those types of things. So it’s CFO needs to know exactly what’s going on. The controller needs to start building that framework and understanding to, yes, it’s from a compliance standpoint, but they need to put on the other hat a little bit and understand exactly why we’re making the decision and that it’s a business decision grounded in data accounting and those types of things. It helps, but there’s also more to decision making than just the financial numbers.
Emily: Got it. So essentially having the line of communication with every department.
John: Yeah, being able to talk to a developer and understand what they’re doing or talking to somebody on a warehouse floor or a machine floor and those types of things and not just being behind the scenes recording what’s happening. You have to be a known entity to everybody. And if you’re a trusted advisor to people that aren’t necessarily in finance in those places, then you can be a lot more successful.
Emily: Got it. And you would have seen many finance controllers transitioning into CFO successfully, you know, while some others may not. So in your view, what are the most critical skills a finance controller should develop to prepare for a CFO role?
John: Yeah, the key is being able to communicate and understand the story to all different aspects to your vendors, customers, and things like that. You can make those deals to really benefit your contract negotiations from a purchasing side. You can benefit from your communication skills on the customer side when you’re trying to get those win-win situations with your customers where you go in a market and you’re helping each other. You’re really partnering. That’s critical. And then being able to communicate complex accounting and financial and debit credits and those things to the rest of the organization to get it a more number-centric organization. A lot of people glaze over and they can’t, you know, turn their eyes the other way and things like that when they start hearing numbers, but they’re critical. If you can’t measure the business and put the KPIs in place and understand what the KPIs and how to move those KPIs, you’re not going to be successful. So it’s critical that the controller develops those skills of not just recording numbers but knowing the numbers.
Emily: True, true. How can finance controllers expand their role from managing the day-to-day financial operations to contributing to strategic decision-making?
John: Yeah, the biggest thing that is critical is to have the right processes and procedures and technology in place. If you have those things in place, then you can rely on them. The numbers are trusted. Things are you don’t have to spend your time just doing the day-to-day blocking the tackling of getting numbers right in the past. You can focus on how we improve the numbers? How do we change those levers in the business? How do you get a take action and have systems of action and things around your ERPs, around your business and things like that, where you can actually impact and change and move the needle from either top-line growth or bringing it all the way down and removing some costs or getting cash back on the accounts payable or expenses and things like that. There’s lots of opportunity out there with tax credits, things like that. If you’re staying current and understand that, you can impact the business from a strategic side and that can provide more funding to ultimately invest back in the business and grow the business even more rapidly.
Emily: I understood. Okay. And John, how important is continuous learning and professional development for a finance controller aiming to become a CFO? Can you recommend any specific area of focus?
John: Yeah, so CPAs, often you have to stay current on the accounting guidance and things like that and what might be changing. That is critical. But beyond that, it’s learning your business, understanding the industry, understanding the technology, going into the conferences for those things and seeing what’s new. Because there’s always something new happening with AI machine learning, the processes that people can do now. The other aspects of the business, you can start learning and you can start getting that industry knowledge that ultimately helps you be that partner to the CEO.
Emily: Got it. Okay, understood. And, you know, for aspiring CFOs, how important is it to have a deep understanding of their specific industry or their specific sector?
John: Yeah, it’s getting more critical than it used to be. It used to be that you just need to follow accounting guidance and you can kind of go industry to industry. Now to be more strategic, your relationships in the industry are more critical and knowing that business is more and more critical. So if you are, you can get more specific to the industry, it helps you be that strategic partner, but it’s not, it’s, you can learn an industry. A county, your accounting background will help. And if you have an operation background and other backgrounds besides just finance, I think it’s helpful as well.
Emily: Okay. And with the increasing role of technology in finance, John, you know, what technical skills or knowledge should finance controllers acquire in pursuit of a CFO role?
John: The biggest skills in the office of the CFO that they should acquire is knowing, again, the business, the technology, the people who’re involved, what the operating levers are, how to think strategically. And then that will get them to that next level and really transform the business and make it a better business and that continuous improvement.
Emily: Agreed. Okay. That’s great advice. So, thank you so much for your presence, John, you know, talking to you about this topic and the journey of a controller into becoming the CFO is honestly amazing and I truly learned so much. So, thank you for being here.
John: Yeah, thanks for having me.
