By John E. Luth
As I conclude this series on the evolution of the pivotal role the airline CFO (and finance) will play going forward, I believe it’s important to cover some of the key aspects an airline CFO must address and master in order to successfully lead digitalization. (Note that if you missed the prior posts, please use this link to go to my first blog: How airline CFOs are rising above.) Beyond the technological challenges, in this blog I explore why CFOs need to understand and leverage the human aspect of change as highlighted in our recent paper, “Experience the difference – How Intelligent Business Services fuel growth and place the user experience at the heart of the enterprise.”
Developing the future finance staff
As finance’s responsibilities continue to stretch, so too must the skills and knowledge of CFOs themselves and of prospective talent. In the past, young people who simply showed a reliable and detail-oriented nature might have sufficed, but now CFOs need employees with a wide range of capabilities, from data visualization to flexible thinking. But how do you go about doing that?
Typically, the CFO and senior finance executives have developed these skills at a much greater rate than the department at large has. The result? A knowledge gap between the top and bottom of the organization. Technology or data are not the culprits limiting the pace and outcomes of transformation programs within finance — it is the human talent challenge of finding people with the right skills.
As highlighted in my first blog of this series, “How airline CFOs are rising above” and Accenture’s report “From Bottom Line to Front Line,” CFOs recognize the need for change and accept that traditional roles may soon become obsolete. More than three-quarters (78%) say the change must be rapid and drastic.
“It feels like there are two camps for what people look for in a CFO,” explains Christopher Weber of Halliburton in the report.“The control or accounting background versus a more strategic finance role who partners with the CEO. Over time, I think the shift has been towards this second role, even if that means the candidate isn’t an accountant by training.”
Organizations need to be able to pivot between looking backward and looking forward and be strategic and focused on getting the books closed while ensuring all the proper controls have rigor. It takes talented leaders to strike this balance.
Which skills matter most?
So which skills are most necessary for an airline CFO to effectively drive change across all aspects of the airline’s operations and back office? We believe the ability to innovate and analyze while understanding the broader strategic initiatives of the airline and how their work supports those strategic initiatives is essential.
Airline CFOs can learn from the experiences of other finance executives we spoke to. “What you’re looking for is people who are adaptable and resilient,” says INPEX Australia’s Daniel Gentili in our report “From Bottom Line to Front Line”. “We are looking for people who are inquisitive. They need to ask: ‘Is there a better way to do this? Can I get this information differently? How did that information come out once I pushed that?’ They must be prepared to bounce if they fail and go back and look again.”
“The CFO still needs to be somebody that you can trust implicitly to cut through all the bias and be the honest broker in decision-making and running financial analysis. None of that is particularly new,” adds Larry Reinhold of Systemax. “What is different today is that process and automation across the board is completely different, even in financial areas, so you also have to be IT savvy.”
The former managing director of a global consumer goods business based in Europe believes that finance needs to understand the drivers of the business.
“It needs to be outward-facing,” he says. “In tune with the marketplace, visiting customers with salespeople, and building relationships and bridges to other functions.”
The biggest challenge is recruiting or training the talent necessary to understand how to collect and gain insight from data. Finance professionals need the right skillset to communicate with the rest of the enterprise, working with other functions to drive the right conclusions and actions out of the insights.
It’s about people, not processes
Delivering intelligent business services requires the combination of an evolved operating model with a radical shift in company culture and mindset to deliver impactful insights. In order to do so, the airline CFO must evolve the business services being delivered by the finance group and other groups in two ways:
All of this can be thought of as being “human-centric, experience-based” intelligent business services for an airline group. that has three critical aspects: (i) digitalization of processes to ensure “a single truth” distributed across the airline’s workers on a timely basis; (ii) an agile and capable airline workforce, which has been recruited and trained with the future of intelligent business services in mind; and (iii) a value ecosystem both within the airline and outwards towards its customers and its business partners.
If you have read all four of my articles in this series, I hope you take away three fundamental points:
First, airline CFOs have a unique opportunity to learn from their peers in other industries which are far outstripping airlines in pivoting to the new. While airlines are far more complex and intertwined in their operations and systems than other enterprises, nonetheless, that is not a reason to think out-of-the-box on how to avoid continuing to plod along on a linear trajectory!
Second, airline CFOs are uniquely positioned to drive change across the organization by influencing and empowering their C-suite colleagues and their organizations. Often this is best accomplished through ‘leading by example’ in first transforming their own finance and accounting functions with robotics and AI. In doing so, CFOs can drive a ‘single version of the truth’ which provides the foundation for accelerating change across the enterprise. I believe achieving this single version of truth will prove to be extremely powerful in driving change in airlines.
Finally, the greatest challenge facing CFOs is managing the human dimension in developing business intelligence services. While multi-faceted, the challenges boil down to developing the right operating model and promoting and nurturing the right mindset and culture to have a sustainable and transformative business intelligence service organization.
Exploring the future of the function
Explore the major themes influencing the shift in my blogs: