In today’s world where everything is instantaneous, research is increasingly highlighting the importance of reducing distractions
It’s true. Most of us are very distracted. Between social notifications, text messages and a barrage of ads and marketing messages, our attention spans are getting smaller and smaller.
Cal Newport is known as a pioneer in studying how distracted people are now, and coined the term “Deep Work.” Here is the definition Newport provides for Deep Work:
“Professional activities performed in a state of distraction-free concentration that push your cognitive capabilities to their limit. These efforts create new value, improve your skill, and are hard to replicate.”
With that definition in mind, let’s take a look at your mid market company’s financial department.
How many of your senior financial team are performing with distraction-free concentration?
And let’s look specifically at the role of the CFO. In a perfect world, a CFO is looking forward, building strategy and impacting decision-making for the direction of the company.
As one CFO we interviewed put it:
“A CFO’s job is to have an unfiltered, 30,000-foot view of the business across all business units. This enables them to understand where the company is adding or destroying value and what levers to pull to best optimize company performance and shareholder ROI.”
– Former CFO of a Fortune 100 Company
Having said all of that, it’s quite obvious a company is going to better off with a less-distracted, more focused CFO.
But is that actually happening in reality?
Even if you take away the distractions we are all dealing with like social media, text messaging and media overwhelm – just looking at the financial functions in a company, many CFOs are too distracted.
CFOs are reporting they are more distracted and have less time to focus on strategic big picture items. This means a few things.
For the whitepaper, we spoke with Kenneth Fick, the President and CEO of FPAexperts.com
Fick shared three primary functions that dominate a CFO’s time.
1) Order to Cash: from receiving customer order to billing for goods sold. This function is A/R and revenue focused and makes sure the incoming cash is handled, collected and reported.
2) Procure to Pay: From obtaining raw materials to paying for secured materials (NOTE: in service focused businesses this includes payroll as that is a direct cost of the service)
This function is A/P and cost focused – looking at the movement of cash and allocating expenses properly.
3) Record to Report: From period close to financial reporting of period performance. This function is building out reporting and data on the health and essential performance of the company.
CFOs are Reacting Instead of Building Strategy
All of these functions are not only critical, but they are a prerequisite for any analysis or projecting. If an organization falls behind in any of these three items, everything else goes on hold and a CFO inevitably is forced into cleaning up the issues and ensuring proper data is extracted.
According to Fick, poor processes with order to cash, procure to pay or record to report have a major ripple effect on a company.
So what ends up happening when these processes are slow or unorganized, is every single month a CFO has to dig in and clean things up. It’s thankless work and involves minutiae, but has to happen for an organization to have any semblance of a financial picture.
Where to Go From Here
A company needs a forward-looking financial strategy to grow and thrive. To do that, enterprises need streamlined financial processes and a CFO who can oversee the minutiae but stay above it.
Something to consider is hiring a part-time controller. A controller can be a high level talent, but is focused on making sure the accounting and bookkeeping is getting done, the reporting and data will be ready and can take a tremendous amount of pressure off the CFO.
Another potential solution is on-demand talent, like Paro provides. When dealing with training, managing and turnover issues – everything gets slowed down.
With on-demand talent, you can plug in gaps immediately and ramp up your professionals in no time.
Finally, if you want to go deeper into this topic, we have put together a full length whitepaper on how CFOs can stop wasting time and get back to adding the most value possible.