Jeri Williams knows how it feels to be treated like an outsider in her own city. Williams is a born-and-raised Phoenician, and she served with the Phoenix Police Department for 22 years before leaving to become Police Chief of Oxnard, California, but when she returned to become Phoenix’s first female Police Chief in 2016, some were concerned that she might try to transform the department the way one outsider before her had attempted. Part of Williams was offended at the thought, but she also saw where the fear was coming from: The Department was $4 million over budget every month, severely understaffed, and over 50% of the staff it did have was eligible to leave. In short, the Department needed change and everyone knew it. The problem was too few were willing to take the first step.
Many call the supercenter the greatest retail invention in the world, but Brett Biggs, Wal-Mart’s CFO, is one of the first to admit that the landscape has changed markedly since the first Wal-Mart supercenter opened in 1988. Despite these changes, Biggs and the rest of the executive team have ensured that thecompany stays relevantand they continueto innovate beyond expectations.Recently, Biggs shared his learning and insight at Leadership for a Networked World’s2019 CFO of the Future Summit, which focused on Value at High Velocity.
Located in the heart of West Baltimore, Center for Urban Families (CFUF) serves an area that is beset with significant poverty, crime, and racial inequity. Founded in 1999 with a mission to “disrupt poverty,” CFUF has served more than 28,000 members, placed 3,779 members in full-time jobs from 2010 through 2016, and touched nearly 62,000 children whose parents were CFUF members. The organization has received national attention for its work, hosting President Barack Obama in 2013. During the visit, the President spoke about his upbringing without a father and lauded the fathers there for working with CFUF to change their lives. “For your sons to see you taking this path,” the President said, “that’s going to make all the difference in the world.”
CFOs today must embrace ceaseless change. The average company in the S&P 500 will be on that list for just 12 years by 2027. That is half of what it was in 2012, and about one-third of what it was in 1964. The downward trend line is unmistakable. Darwin was right, as Perfetti observes. Survival of the fittest is alive in well in today’s corporate world. And only the fast survive.
Having spent more than a decade studying rebels in unexpected places, Tandon Family Professor of Business Administration at Harvard Business School Francesca Gino joined the CFO Summit to share what she learned, applying it to the evolving role of the CFO. This article is inspired by and reflects some of the themes of her presentation.
Like most retailers, Walmart began its journey by opening just one store. Still standing today in Rogers, Arkansas (but now a Supercenter), the first Walmart opened its doors in 1962. Yet over the last 57 years, Walmart stands out from other retailers by the sheer magnitude of its growth. The company has become a household name and now boasts a total revenue of $515 billion and $28 billion in operating cash flow. It has retail presence in 27 countries and employs 2.2 million total associates who help to complete an average of 275 million transactions per week.
For chief operating officers and chief supply chain officers, the new pace of change is driven by questions that that have the potential of completely transforming operations: What if our customers could co-design an entire service or product virtually with our firm –-how would that change our operations? What if a supply chain could “think” on its own-- what would that mean for our business? What if value shifted from single firms to broader ecosystems and networks--how would that impact our current business model and create new ones?
When James O’Neill became the Police Commissioner of New York City in 2016, the department was in the midst of significant change. During the previous summer, the NYPD launched a neighborhood policing pilot program in four precincts. The goal was to test strategies for building trusting relationships between residents and police with the hope of further reducing crime and police-involved shootings. Some of these strategies proved successful, and the NYPD worked to expand the program, but there was plenty of resistance. It was up to O’Neill to make the case for neighborhood policing and lead the Department toward making necessary changes in its policing philosophy and practices.
As CFOs and financial executives at the Summit have reflected on their role in the world, they’re experiencing profound change now, as well as seeing shifts on the horizon. In fact, over the past three years of the CFO of the Future Summit, and average of 71% of attendees said they have experienced “significant or extreme change” in their operating environment over the past five years, and 86% anticipate even more change over the next five years.
This level of change – driven by massive social, economic, and technological shifts – is moving CFOs to relook at the core strategies, competencies, and activities they focus on. This reflection and anticipation have made it clear that the CFO of the Future has to not only protect and drive firm value, but also create and harness new business models and forms of value. As Tracey Travis, CFO of Estee Lauder Companies and member of the Summit Executive Leadership Group framed; “In finance, rather than creating static reports to look at trends, it’s about our ability to help the organization be more predictive in what’s trending and determine what response we can develop to generate new value from that. We have to create more real-time dashboards, understand what’s happening, and be ready to capitalize on that.”