Good morning. Kevin Kelleher filling in here for Sheryl today.
Edith Hamilton was having breakfast with a coaching client at the bottom of a hotel’s cavernous atrium. The client, recently promoted from controller to CFO at a healthcare services company, had been tasked with improving monthly revenue projections that somehow always fell short. Progress was plodding at best.
Whenever the CFO pressed for more visibility into sales projections, she heard bland assurances like, “We’re working on it.” Yet the shortfalls continued. The new CFO reasoned that the staff knew operations better than she did, leaving her to wonder: “Who am I to hold people accountable like this?”
“You are the second-most-powerful person at this firm,” Hamilton reminded her. “Who else is going to step up and drive this kind of accountability?” To underscore the point, Hamilton brought her client up to the top level of the atrium for an all-encompassing view of the bustling activity below. Then Hamilton asked her to draw an analogy of that view to her world at work.
“It was like she could suddenly see and feel in her body that she was big and tall and had access to a birds-eye view like few did, that others needed her to share what she saw to broaden their perspective,” Hamilton tells me, recalling that moment. “That alone was a huge shift.”
In these uncertain times, CFOs and other corporate leaders are increasingly turning to Hamilton and her peers in the $14 billion executive-coaching industry. Last year, more than 70% of organizations offered some form of leadership coaching. After all, it’s easy for CFO’s to feel overwhelmed these days. Inflation and business automation present new challenges. CFO tenures are shorter, and turnover rates are higher.
Hamilton has worked as a CFO coach and mentor since founding NEXT New Growth in Los Angeles in 2016, following a career as a CFO and executive at companies and nonprofits. Clients seek out her coaching to improve their strategic and operational focus; manage their bandwidth to avoid burnout; sharpen their emotional intelligence and engage their teams; or create buy-in with stakeholders, CEOs and boards.
“Many are first-time CFOs, but they can also be experienced CFOs who realize they made some mistakes they’d rather not repeat,” Hamilton says.
Whether seasoned or not, the first 90 days a CFO spends at a new company are crucial in setting the tone. Hamilton urges new CFOs to take a break before stepping into a new role, not to rest but to study up on their new company and its industry: reading analyst reports and SEC filings, talking with people in the know, and preparing the right questions to ask once they’re in the door.
Building early relationships with reports, peers and superiors is also key. “CFOs often want to get right into the nitty gritty of their finance department right away, and that can be a mistake,” Hamilton says. They also need to build bridges with peers in revenue-generating departments like sales and operations. “That’s where finance will add value. You can’t fix anything in finance until you know what your customers need.”
With that intelligence, new CFOs can check in with their direct reports to get their input on how the finance team can best achieve the company’s goals. “This builds a rapid connection at the personal level where your colleagues see you as a listener and as someone who wants to have a true partnership.”
Connection building applies to the board as well, although this can involve a bit more finesse. Some CFOs who set up meetings with board members may alienate CEOs who see this as going over their head. Letting your CEO know you’re an ally who can be an extra pair of eyes and ears with the board works better as a precautionary first step.
Others may err in the other direction by being too timid, waiting in vain for board members to reach out to them. Hamilton worked with one CFO with such a mental block. “It sounds to me like you’re standing at a bus stop waiting for the board member to pull up in his limo and ask you to come in,” Hamilton told him.
The CFO nodded and said he related to that. “And how do you feel about being stuck in a bus stop waiting?” she said. The CFO, who protested he was not a passive person, saw a light go on in his head. Working with his CEO, he then established contacts with the board to set up initial conversations.
“You don’t want to be walking into your board meeting for the first time without having ever met these individuals,” Hamilton says. “You need to have had at least one conversation with every single one of them beforehand.”
It’s such “aha!” moments that Hamilton’s weekly one-on-one sessions aim to achieve. Often, the metaphors will be tweaked to resonate with the client (waiting at a bus stop became steering a favorite car), and she’ll often rehearse the words and body language needed to execute a desired goal.
Such exercises are also helpful in addressing the self-sabotaging behaviors that CFOs, like everyone else, are subject to. Hamilton points out that some of the more common ways CFOs hurt themselves are tied to the strengths we think of them as having: being rational, vigilant in oversight, attentive to detail, and in control. Going too far with these traits, however, can mean being so rational that emotional intelligence falls away, so over-vigilant your naysaying stifles creativity, or so controlling your team loses its trust in you.
Another client Hamilton worked with, a consultant who transitioned to a CFO role at a services firm, would undermine his potential by being hyper-vigilant. His fluid communication style would vanish when speaking before a group as he stifled and over-edited himself out of a fear of saying the wrong thing.
Hamilton’s coaching showed him that safety and security couldn’t be found by controlling external circumstances, but only inside himself. Again, a metaphor with personal resonance helped: The client loved surfing, a sport that favors instinct over hyper-analytical thinking. When surfers fall off their boards they hop right back on, the CFO realized, so it must be okay to do the same before his colleagues.
The metaphor took root. The CFO began conducting Zoom meetings while standing, to keep the surfing metaphor constantly in his mind. “He started feeling he could respond in the moment—it didn’t need to be perfect,” Hamilton says. “He was able to become much more assertive with his C-level peers, especially in sales.”
The other area Hamilton works with clients on is career advancement. “Less than 5% of the people I coach say their ambition is to become CEO,” she says. “It involves a very different skill set. To be a good CEO is primarily to be a salesperson—selling ideas to the board, to customers, to employees.”
That can present CFOs with the conundrum of where to aspire to land next. For division CFOs, it might be advancing to corporate CFO. From there, they can advance to larger companies, with a position at a large public company being the pinnacle.
Strengthening your chances for a more ambitious and higher-profile position often means expanding your skills in areas like M&A or raising money through credit lines, private placements or the legwork needed to stage an IPO. This can mean working more closely with investment banks and investors in fundraising. It also helps to be named to board seats—starting out with nonprofits or smaller companies if necessary.
“These are absolutely paths that you want to try to get involved in,” Hamilton says. “Because that is career progression. That’s what enhances your appeal for the next role you want to take on.”
Kevin Kelleher
Twitter: @kpkelleher
This story was originally featured on Fortune.com
https://finance.yahoo.com/news/top-finance-execs-often-self-105330787.html