Finance Executives: Pick Up The Bat, Step Up To The Plate and Hone Your Skills
If you achieved your goal only 30% of the time would you consider yourself a success?
Barely 10% of batters in major league baseball get a hit (a positive outcome) in more than 3 of 10 at bats. In 2019 the best batter in baseball achieved his goal less than 34 out of every 100 at bats.
There are stark contrasts between the role of a batter (also called a hitter) and the role of a senior finance executive.
- Hitters have a very low success rate; high rates of success are expected in financial roles.
- Hitters have a solitary focus regarding their craft; financial executives have many “bases” to cover.
Still, I was intrigued to discover what lessons great hitters have to teach financial executives. I thought it would be a lesson about perseverance. Yet, after receiving feedback from some great hitters the teaching opportunities mounted.
Here is what I learned from these hitting experts and how it applies to becoming a great financial executive.
Good hitters begin with a solid foundation, both physically and mentally. Hitting experts point to the “stance” as being a balanced, athletic, comfortable position. Interestingly enough, there are significant variables from hitter to hitter as to what a solid foundation looks like. Some actually lift their lead leg to prepare for their swing; others keep it close to the ground. They recognize that power comes from our connection to the ground. ”Hitting from the ground up” is a phrase used to describe this solid foundation. Mentally, a hitter must be in tune with the game situation. The mental foundation they lay will influence their physical foundation in the batter’s box. That will be covered more thoroughly below.
A financial executive’s foundation is extremely important as well. There is a physical component around good health that allows us to function where and when needed. The larger part of our foundation is built through education, training and the creativity we tap into when performing our roles. Like the batter who isn’t balanced, if the senior finance officer doesn’t have a solid foundation in the four pillars (Accounting, Finance, Treasury and Leadership – the AFTL) it will be difficult to achieve long term success. Batters can assess their foundation after every at bat or even each swing. Financial executives can do the same. We need to define what makes up “a swing” to do so. Our swings might include preparing meaningful insight to our forecast, installing a system that improves the customer experience while reducing our internal errors, reviewing monthly performance, adjusting the plan before the financials become stale or delivering against the Risk Charter adopted by our Board.
The best hitters use discipline in two ways. First, discipline is used to describe the preparation and practice required to develop hitting techniques that provide the foundation described above. Our experts say, “There are no shortcuts to discipline”. Hours in the batting cage, implementing coaches’ batting advice and gaining comfort with your stance takes time and repetition.
Discipline also came up when referring to each at bat during a game. In this context, discipline was used to describe having an approach to each at bat, even each pitch. The experts agree it is critical to analyze the situation (for example, how many outs are there, how many runners on base, what is the pitch count, what inning is the game in and what is the score) and adjust the approach to each new situation. Although hitting normally has a single goal, there are so many variables in each at bat. Discipline is required to anticipate and practice the best approach required for each situation.
Financial executives have many disciplines that revolve around deadlines; closing the books, meeting compliance deadlines, creating the Board Pack, etc. My experience suggests, if a solid foundation is in place, we are really good at managing these deadline driven disciplines. I believe a big opportunity for finance lies in adopting the batter’s approach to making adjustments when our “standard fare” doesn’t meet the business needs. The best way to understand when this happens is to ask those relying on what we produce. Another way to recognize this is when our colleagues or customers are finding their own means to get what they would normally get from the AFTL.
Instilling the discipline to frequently challenge what we are doing to create value is hugely beneficial and often overlooked. The information the AFTL provide others is our main source of credibility. These are the times we are “at bat”. Having the discipline to analyze the situation and change our approach to each at bat is a tremendous value add.
Here is a question you can apply to your business to determine how creative you are when you are at bat; How do your monthly management reports change from month to month, given the current state of your industry, business and customer base?
“The best hitters in the game are always working to get better. It doesn’t matter if they go 5 or 5 or 0 of 5. They never miss a chance to be in the cage (batting practice facility) improving themselves.” And “Hours and hours of working on the fundamentals; soft-toss, tee drills, live cage work, and drills, drills, drills.” They couldn’t say enough about how important practice is to mastering their craft.
How can finance executive use the practice principles of hitters to sharpen our skills and master our craft? After all, a hitter spends 99% of their time practicing and 1% performing – taking an at bat in a live game – whereas, finance executives are always in a live game.
The answer lies in the definition of “practice” when used as a verb:
perform (an activity) or exercise (a skill) repeatedly or regularly in order to improve or maintain one’s proficiency.
Here is a perfect place for a learning assignment. List the 2 most important activities your team performs and the 2 most important skills you bring to the table. List new practices you can implement to improve the proficiency of the team activities and your skills.
This is an area where hitters have a great lesson for finance executives. In an activity where the result you work for is only achieved 30% of the time what do hitters do to stay motivated to do their best the next time they come to the plate? The expert hitters contend it takes confidence, focus and a plan to create a successful at bat. Confidence is derived from the first 3 points above, especially knowing you have put in the practice drills and time to get a good swing on any pitch you could face. Being able to focus on the immediate situation and be present in the now is imperative. They said this included knowing the pitcher’s tendencies, looking for queues that might tip the next pitch, the number of outs, baserunner capabilities, the position of the defense, even picking up the seams of the pitched ball to predict its movement.
Our experts stressed how important having a plan (they called it an approach) for each at bat improved success. The plan for each at bat is different depending upon the pitcher, number of outs, score of the game, the inning and other inputs. Their plan could change slightly after each pitch in the at bat. They are constantly looking for any slight advantage that will increase their odds of success for that at bat.
The approach to an at bat is antithetical to the way we normally set up our finance processes. We normally set up our processes to be consistent, error free, efficient, repeatable and exception proof. We set them up to be algorithmic, then we have staff execute the process. We follow up by measuring errors, looking for inconsistencies and inefficiencies and imposing more controls to prevent these flaws. We might even wonder why our staff isn’t more innovative and creative in improving the process. It’s at this point I realized I need to look into the mirror to see the root cause of this problem.
Can I improve the attitude of staff by occasionally swapping my audit cap with a batting helmet and making certain our staff knows they will be safe doing the same? As automation and the artificial intelligence acronyms; RPA, ML, VR and AR, are implemented in our businesses, preparing our talent to know when to become batters rather than auditors will drive value while leveraging our talent.
5. Data Gathering
I was surprised at how much data great hitters use to improve their chances of success. They don’t just come the plate and swing away. Some of the data they are converting to actionable information was noted earlier. They also study what pitches they hit best and worst, what count is their favorite and least favorite, what pitch zone is their swing most effective, do they hit right handed or left handed pitchers better. They are data machines. Once they have this data available they create information from it that allows them to practice on improving their weaknesses. They understand that some flaws (like not being able to hit a specific pitch) could be fatal to their career.
This analogy is simple for finance executives. If we don’t bring insight about our business to our colleagues, the company will find somebody else who will. Our training and discipline develops people with great analytical skills – we have the tools to deliver great insight to our companies and colleagues. Our Achilles heel in this area is we get bogged down in the urgent vs the important (credit to Stephen Covey) and miss the opportunity to “sell” the ROI on the investment in data gathering to create insight to our companies. We have to believe this is as important as batters do and make it a priority.
6. Learning from unsuccessful trials.
This lesson may be a little more obvious than some of the others. Our batting experts are unsuccessful a lot. They say, “ Most people cannot deal with the constant failure at the plate, and let it negatively affect them. Great hitters learn from the failures, forget the failure, and move on to the next task/at bat with the same (if not more) confidence they will succeed.” If they didn’t learn from failure their success rate would drop below an acceptable level and they would be forced to find a new vocation. They are continually making adjustments to the 5 key points above based on the most available information.
Our profession has its roots in technology that is 500 years old. We’ve honed it so that failure doesn’t occur very often. But does preventing failure really mean we have been successful? Does closing the books by +4, having the forecast available by the Board meeting, accessing funding that covers our short term needs or meeting our KPIs make us successful? I think these may help us get by - keep our job a little longer – but they are simply the foundation for the company we want to build. Using a Batting philosophy can help us add stories to that foundation.
Identify your path to CFO success by taking our CFO Readiness Assessmentᵀᴹ.
For the most up to date and relevant accounting, finance, treasury and leadership headlines all in one place subscribe to The Balanced Digest.
Follow us on Linkedin!