"Having worked as the CFO for five CEOs across three industries, I have learned what really differentiates you as a CFO," noted Jeff Campbell during his keynote session at the 2017 CFO of the Future Summit: Fueling the Growth Agenda. "What really differentiates CFOs today is whether you are the key partner to the CEO in driving the business and creating change."
When Jeff Campbell dropped out of Stanford and joined a rock band at 20, he wasn't envisioning a future where he'd be managing a trillion dollars of cash flow as the CFO of American Express.
After four years on stage, though, Campbell went back to school to focus on economics and accounting, eventually earning a CPA while at Deloitte and then an MBA from Harvard Business School. From there, he joined American Airlines, eventually leading that company through an out-of-court restructuring in the aftermath of 9/11 as CFO. After leaving American Airlines, he went on to join the healthcare company McKesson as CFO, helping to advance the financial goals of a more decentralized corporation with decidedly different objectives. From McKesson, Campbell joined American Express as CFO, where he again learned a new industry and a new corporate culture.
While he's had a varied career, he says the critical lesson he learned from each company remains the same: the CFOs that are most successful work up and down the chain of command as a business partner, not just as a financial leader. Beyond simply identifying ways to improve the finances of a given organization, CFOs have to be able to interact with all of the parts of the business and create value. At American Airlines, this meant understanding how to drive change up the chain in the boardroom and down the chain with labor unions and employees. In the sales-driven culture of McKesson, it meant driving resources and goals towards the most valuable and fast-growing parts of the far-flung enterprise. In the marketing-driven corporate culture of American Express, it means leading a team that is focused on advancing profitability while leveraging and sustaining one of the most trusted consumer brands in the market today.
In order to facilitate enterprise-wide growth and transformation, Campbell encourages CFOs to consider three core questions as they approach their work:
The CFO role involves a lot of reporting and strategizing about how to make the most of a profit and loss statement, and while the nuts and bolts of that reporting process are important, Campbell says the key to success is spending the right time in the right places.
When he took over as CFO at American Airlines in the aftermath of 9/11, the company was facing a steep drop-off in consumer desire to fly. Rather than focusing solely on lowering ticket prices or enticing more consumers to fly, Campbell went to work, meeting with people in every part of the organization to find ways to optimize and restructure the company in order to stave off bankruptcy until consumer demand returned in the years following the attack. "When I sat down with the CEO he was focused on how we were going to talk to each one of these groups and actually make change happen," Campbell says.
Learning how to be a player-coach as a CFO means that Campbell spends more of his time with people than sitting in front of Excel spreadsheets working on financial models and filling in formulas.
After Campbell left American Airlines and joined McKesson, he was confronted with a much more decentralized organization, a different industry, and a different corporate culture, but the focus on time spent in the right places remained the same. Campbell explains it this way, "I was sitting with the CEO, John Hammergren, having the obligatory discussion we all have every time we switch jobs, which is: a year from now, how do we tell if things are going well? And he said, 'Jeff, you personally, and your finance organization, should be influencing business decisions in every nook and cranny of this company without anyone fully realizing you're doing it.'"
In order to support those business decisions, Campbell says he tries to spend about half of his time focused on people issues. Learning that he spends that much time finding and supporting the best people in his organization often surprises outsiders and even junior colleagues, but for Campbell, it is important to have a team that can execute on shared goals, even if he's not always there to guide each and every step.
Qualifications and technical skills are obviously important when it comes to finding top talent, however, Campbell notes that the best people have three additional factors that help them advance to the next level: honesty, a people focus, and drive. "One of the hardest things we all do as leaders is be brutally honest, but in a positive way," he contends. The best leaders in any organization are those that can define reality, identify solutions, and do so in such a way that the organization has hope about the future and wants to make that future possible.
For Campbell, successful CFOs are those who can balance the CEO. The CEO sets the tone at the top. Campbell adds, for the most part, that tone should be relentlessly optimistic – it has to be. The CFO, however, is most effective when they can be completely honest and clear about where the numbers actually stand. To do that well, the CFO should have the same 360-degree view into the organization that the CEO does, and the support of a team that has the drive to move the organization forward toward the future the CEO envisions.
Ultimately, a CFO that is successful at spending time in the right places and with the right people, can work with the CEO to lead transformational change in the organization. "Every company I know is on a transformation journey," Campbell says.
But just as companies must constantly change, so must finance organizations. Yet Campbell suggests that many finance people are not operationally oriented to continuous improvement in how finance operates. They got into finance because they love, well, finance. That focus doesn't automatically lend itself to considerations about managing people well or managing organizations well. New advances in technology can make continued operational improvement easier and also help the finance team create more value through advanced analytics.
"When you think about manufacturing companies, for example, it's in their DNA to think about process improvements every day," Campbell explains. "Finance people just don't think like that. So unless a CFO gets involved in that kind of thinking, the finance organization risks getting left behind."
According to Campbell, it's critical for CFOs to work on understanding how technology can help their firms thrive internally as well as externally. Advances in technology can help finance teams lead the transformation journey just as well as they can help the more operationally focused parts of the organization. "It's hard to find people that can think at the intersection of finance and technology, but that's what we have to do. That's the next step," he says.
Leadership for a Networked World’s applied research, student innovation challenge, and on-campus summit programs are an initiative of Dr. Antonio M. Oftelie, Innovation Fellow at the Technology and Entrepreneurship Center at Harvard (TECH), part of the Harvard John A. Paulson School of Engineering and Applied Sciences. TECH is a hub for students, faculty, alumni, and government and industry leaders to learn together, collaborate, and innovate. LNW accelerates these efforts by connecting leaders across sectors and developing cutting-edge thought leadership on innovation and organizational transformation.