One Big Thing Finance Professionals Need To Deliver Value
There are two types of accountant and finance professional, those that ensure the appropriate controls and compliance are in place so that the numbers are accurate and consistent – let’s call this preserving value, and then there are those who are coming out from behind their desks, engaging with the business on meaningful problems, solving them, being a trusted sparring partner and financial mentor – let’s call this creating and capturing. How do we make sure we have the opportunity to be the latte?
It has to do with our image as a professional. As accountants and finance professionals we’ve had many thousands of years of experience recording transactions. Some of us can even build up an entire business from a box full of receipts or a shopping bag of transactions. So, imagine what we could do if given other non-financial type data, and imagine what we could do if we started combining the financials and non-financials together (like the cost of customer retention or impact of service failure rates on earnings per share).
Low expectations historically
As accountants and finance professionals we’re pretty darn good at preserving and safeguarding company assets with our technical compliance and controllership skills. Until recently, we’ve not really expected more from ourselves and likewise some of our organisations have been slow to expect more from us. This is why our colleagues frequently do not proactively come to us for help. An image of the accounting and finance professional from a bygone era haunts us. They don’t know any better.
Complicated spreadsheet and terminology
Also, we communicate in terms of rev rec standards, lease accounting, NPVs, ROIs, EBITDAs, GMs, GAAP, etc…. We’ve hidden behind complicated spreadsheets that we deliberately designed to make it difficult for others to decipher them. As accountants we’re the brunt of many jokes. If you wish to get out of talking to people at a dinner party just say you’re an accountant. Conversation just stops, I’ve tried this, for fun. It’s uncanny.
In fact this is highlighted well in a study published in the Australian Finance review and highlighted in this TEDx talk by David Boyar who utilised a family BBQ as an example to reinforce the poor image point.
From a personal finance perspective studies show 4 out of 10 people won’t talk to anyone about their financial affairs, hopes and dreams, 2.5 will talk to their business partners and colleagues, 1.5 will talk to a family member or friend, and just 1 will just talk to an accountant (the rest will talk to a mix of other advisers). The same study also found if you spoke to your business partner you had a 50/50 chance of getting positive advice you could execute, a coin flip, a friend a 25% chance, even though an accountant has an 83% chance of giving you positive advice, a massive increase, but fact is, people don’t want to speak to us.
So why aren’t accountants being involved in these conversations? Would we still have 9 out of 10 business failing if we were? Our great unknown is putting ourselves out there, as accountants and finance professionals we are risk averse, we don’t take risks, and a fine example of that is in venturing out from behind our desks, it’s a risk averse activity. It’s also an activity that will change our image.
Extroversion / Introversion anomaly
There’s an anomaly here. Did you know only 35% of accountants tested as introverts in a recent study (most of us are extroverts), but we have this perception of being boring and risk averse relative to the sales reps in our organisations. They are considered more extroverted, out there, engaging with others, making things happen. So at the moment we’re spending too much time buried in numbers and not enough influencing and leveraging our assets to unlock value creation opportunities with the organisations we serve.
I’ll mention the antidote on a follow up article, but if you can’t wait that long then listen into our #SITN Show where we bring on guest mentors to our Strength in the Numbers Show, to share with you their stories and hard won lessons and practically figured out how to address their image problems to build on the compliance and controllership skills to create and capture even more value in and for their organisations. And ultimately help you learn how to leverage your strengths in the numbers faster for a more rewarding, successful and fun career as a finance professional.
So what do you think, have we been slow to grasp value creation or do we have an image problem?
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