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How to Make Dramatic Changes in Business

How to Make Dramatic Changes in Business

Recently, we had a coaching participant mention to us how her company was wanting to make a huge change in their business that would ultimately destroy the current business.

This happens more often that you would think…

The owner or founder of the company wants to make a shift, a change, but the leadership did not full think through what that would actually look like.

In our coaching participant’s case, her company had been around for a long time. They were known widely for their innovation. They were also a non-profit. The founder wanted to convert the company into a for-profit entity.

That change would change EVERYTHING.

In fact, it would be an entirely different company.

In this week’s blog, we look at how to make dramatic changes in business while avoiding catastrophe and how to reinvent your company.

Change requires a strong leader. Learn how to be a more effective leader here.

How to Make Dramatic Changes in Business

When a company makes dramatic changes in their organization, it’s important to ensure the change will be sustainable and has the benefits outweigh the risks. This starts with questions like…

How can we better develop our product/service to provide more value to our customer?

What organizational changes can we make to reduce overhead and increase productivity?

Is our current company structure the best structure for accomplishing our mission?

Do we need to totally reinvent ourselves just to survive?

In our first example, changing the organization from a non-profit to a for-profit would only stuff the founder’s pockets; however, upon further conversations with their Finance Director, we came to the conclusion that that organizational structure change would change everythingmarketing, branding, funding, employees, legal aspects, and accounting. It would cost more to make that dramatic change than to stay the same. They would most likely loose their funding, their employees, and their entire culture.  They apparently were making a change for the wrong reasons.

Driving Radical Change • McKinsey

In a McKinsey article called Driving Radical Change, they outline how to make dramatic changes in business. It first starts with the aspiration – the goal for the change. Then, the leadership for the change needs to be addressed. Who is doing what? What are the priorities? The next two steps include articulating actionable steps for employees to act on and the direct impact they have on the change. This stage is what really fuels the change. Leadership needs to engage and energize their employees during change (change is scary for most people). Read more about making radical change here.

How to Make Dramatic Changes in Business

Why Make Dramatic Changes in Business

So, why make dramatic changes in business? Sometimes, it just needs to happen. Businesses can get stuck in a “rut” where they continue to practice the way that they have always done without evaluating the changing environment or their team. If your company has not made a change (or at least evaluated current practices) in a decade, then it’s time to look at whether radical change is necessary.

Reasons to change include but are not limited to the following:

  • It’s just not working
  • Competition is growing and taking business away
  • There are legal restrictions
  • The market is shifting
  • Technology shift (this is probably the most common in the last decade)
  • New opportunities identified
  • Customers demand something else

Changes could include the following:

Sustaining Business After Big Changes

So many businesses have made changes due to technology advancements, competition, etc. Barnes & Noble has been through numerous CEOs because they did not continue to press on with their Nook and e-commerce platform. Netflix went through a period of declined stock prices as they pressed on to be a primarily online-streaming platform. Sustaining business after big changes can be difficult, but it all comes down to the leadership. Forbes contributor, Erika Anderson, says, “When CEOs and their teams fail to fully commit to change, change fails.” The entire company needs to commit to making this change successful. If one link in the chain is weak, then the whole project will fall.

Here are a few more notables:

  • Amazon started as an online book sales company; it is now a large distribution and logistics company
  • Western Union started as a telegraph company, then it grew to one of the largest money transfer companies in the world
  • Nokia started selling rubber boots; it is now is a major cell phone manufacturer
  • Shell (the major oil company) started in a small store in England importing and selling shells

There is a great quote that I saw in an article from MONEY… “A successful company is like a giant great white shark. In its prime, it chews up the competition, but if it dares to sit still for too long, it dies.”

Your CEO needs a strong leader – especially a strong financial leader. Learn our 7 Habits of Highly Effective CFOs and become the strong leader your CEO needs.

Supporting Change as the Financial Leader

Change is uncomfortable for everyone because there is uncertainty about the results.

Accounting type people are often prone to being the no-sayers during change… It’s too expensive, too risky, and too advantageous.

When making dramatic changes in your business, it’s important for the financial leader to support the change.

If a certain change will dramatically impact cash flow and profitability, then work with your CEO to figure out what you can do.

Do not just say “no”.

The CEO needs a trusted advisor, a confidant, someone who they can rely on for a more financially sound way of doing something.  In my experience, change has usually been good and for the right reason. To learn other ways to be more effective in your role as the financial leader (and to become a trusted advisor), click here to access our most popular whitepaper – the 7 Habits of Highly Effective CFOs.

Dramatic Changes in Business

Dramatic Changes in Business

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Become a Trusted Advisor to your CEO

Summer is quickly transitioning to fall as the weather gets cooler and millions of Americans get ready for football season. Fantasy teams are drafted. Lucky jerseys are dusted off. Schedules are cleared for Monday night football. The action is enticing and our minds focus on all the excitement outside of work. But many neglect to look where the real action is – your career. This fall is your opportunity to become a trusted advisor to your executive team. Get ready for some major movement and success in your career this season!

What is a Trusted Advisor?

A trusted advisor is someone who translates all the technical data into functional and applicable resources necessary for business leaders to make intelligent business decisions. But let’s break that down further… There are two major factors in this role: trust and advice.

Trust is the confidence and ability to rely on something or someone and know that it’s correct. A trusted advisor is dependable, accurate, and able to be emphatic to the position of the CEO. Why? Because as the face and leader of the company, a lot is on the line for them. Respect the weight of each decision they make for the company. By understanding them, you can build a trustworthy relationship.

Advice is a suggestion on how to act according to a situation. When someone takes an advisor role, they are not expecting whoever they are advising to transfer every piece of commentary into action. But rather, they are sometimes blinded and the advisor is helping lead them to a safe, reliable, stable path.

Your CEO wants you to be a trusted advisor or a wingman. But where do you start? Download our free “How to be a Wingman” guide to go beyond the initial steps required to be a trusted advisor.

Transitioning to a Trusted Advisor Role

You have gained the trust of your executive team and they willingly take your advice, but you need to take it one step further if you want to become a trusted advisor. As a financial leader, you cannot talk the talk without walking the walk. So that means you need to get up from behind your desk to see how the business runs and what it needs by talking to those who are involved in production, operations, and shipping. By being an “operational CFO“, you can more quickly gain the trusted advisor role.

Operational CFO

As the needs of your organization change, you need to change your role from a financial CFO to an operational CFO. That may seem a little contradictory, but let’s investigate. If someone asked you to put together a bookcase and provided all the pieces but no instructions, you could probably figure it out with some time. This is the financial CFO: they provide all the data and reports but no instructions on how to interpret them, what they mean, and how to use them to lead the company forward. But if you are given the resources along with instructions, guidance, and coaching, you would be able to build that bookcase in a matter of minutes.

How to Become a Trusted Advisor

There are three primary ways to acquire the insight required to become a trusted advisor or wingman to your CEO. Those include: on-the-job training, apprenticeship, or have a coach. The first option requires 20-25 years of experience, quality experience, and it must be the right experience. Because of the time and quality aspect, this is the most difficult path. For example, you may have 20 years of experience only to realize it is the wrong experience. The second option requires someone who will let you study underneath them; but this is also difficult because computerization and time demands limit the number of CFOs available to mentor. However, the last option is great and can be a quick path to becoming a trusted advisor, but you must find a good coach.

We have put together 5 easy steps that anyone can do to become a trusted advisor in their company.

become a trusted advisor

Ask Them About their Goals

Goals are a huge part of operating a business. Therefore, learn where your business owner, entrepreneur or CEO wants to take the company in 3-5 years. There are two purposes to this: 1) it enables you to help set the course to success and 2) it demonstrates your commitment to being the CEO’s wingman. You will be able to learn why that is the goal, what the plan is, and how you can help get there quicker.

become a trusted advisor

Build a Team

There are eleven men from the opposing team on the football field, then there is you. What are the chances that you can play both offense and defense and win against another team that is switching people in and out depending on their position? Probably 0 So how can you become a trusted advisor to your CEO without having a team to support you?

You are not able to execute the game plan alone. so you need to get others in the company on board. They don’t all need to come from the financial side of the business. Building relationships with other departments outside of finance makes you a more valuable and effective financial leader. This goes back to transitioning to an operational CFO.

become a trusted advisor

Have Their Blind Side

Do you like surprises? If you are a business owner, you most likely hate surprises. As the financial leader of your company, it’s your job to “peed around the corners” to protect the CEO. By having their blind side, you can enable the CEO to focus on executing their vision rather than fighting whatever is distracting them or worrying about things they may not see coming.

become a trusted advisor

Don’t Get Called For Holding  

CFOs often get a reputation for being the “CFnO” or no-man. While it is important to guard your CEO’s back as a trusted advisor, it is not wise to hold them back from doing their job. You will either get excluded from being part of the key strategic decisions or have your job seen as non-essential. You don’t want to get stuck in this situation.

Remember, there’s a find line between playing defense and being an obstacle for your CEO to avoid. Be aware of where that line is, and don’t cross it. Instead, try to enable them to safely take risks or suggest other options that are less damaging to the company.

become a trusted advisor

Keep Score

Teams don’t get to the College Football Playoffs or the Super Bowl based on the score of the last game they played, but instead get there based on what they did all season. Imagine the disaster where a team that only won one game in a season playing against a team who won every game! Keep score of your accomplishments. By keeping tab of what you have accomplished and what you are working on, it’s easier to put a dollar value to it and prove your value. Quantifying your contributions not only builds your confidence, but shows the value you have added in terms that the CEO can appreciate

Conclusion

Your CEO, whether they realize it or not, needs a trusted advisor or wingman. The captain of the team cannot do anything without other leaders. Be the trusted advisor your CEO needs. Download our free How to be a Wingman guide by clicking the link below. Take your career to the next level and step up into the trusted advisor role.

Force Majeure

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become a trusted advisor

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Every Leader Needs a Coach

Every leader needs a coach. This person is someone who has helped you develop your individual skills, knowledge, and ability to better perform your job or given task. But no matter the profession, be it billionaire business owners, world famous athletes to the little league sports player, they are able to pinpoint a particular person who helped and advised them along their journey.

Every Leader Needs a Coach

Check out the following list of great leaders and their Coaches –

1. BILL GATES ( MICROSOFT)

COACH: ED ROBERTS (PC INVENTOR)

 

2. STEVEN JOBS (APPLE, INC)

COACH: ROBERT FRIEDLAND (IVANHOE ENERGY INC. FOUNDER)

 

3. WARREN BUFFET (BERKSHIRE HATHAWAY, CEO)

COACH: BEN GRAHAM (FORMER OWNER OF GEICO INSURANCE)

 

4. KEVIN SYSTORM (INSTAGRAM)

COACH: ADAM D’ANGELO (QUORA)

 

5. TIM TEBOW (FAMOUS QUARTERBACK)

COACH: BILL BELICHICK (NEW ENGLAND PATRIOT’S COACH)

 

6. TOM BRADY ( QUARTERBACK NE PATRIOTS)

COACH: GREG HARDEN (ASSOCIATE ATHLETIC DIRECTOR –UNIVERSITY OF MICHIGAN)

 

7. OPRAH WINFREY

COACH: MAYA ANGELOU

 

8. JAY STEINFIELD (BLINDS.COM CEO, AND STAR OF LAST WEEK’S BLOG ENTRY)

COACH: THE VISTAGE GROUP

 

9. MICHAEL JORDAN

COACH: PHIL JACKSON (FORMER BASKETBALL COACH)

 

10. BARBARA CORCORAN( REAL ESTATE MOGUL)

COACH: DARREN HARDY (SUCCESS MAGAZINE PUBLISHER)

What do CFOs do?

So what’s a CFO to do?  Many of us don’t have the resources to hire a personal coach, so do we have to forego the benefits of having a trusted advisor to guide us?

One solution is to find a coaching program that brings together several like-minded individuals under the guidance of one professional coach.  This approach allows individuals to not only reap the benefits of coaching at a lower cost than one-on-one coaching, but allows for the sharing of ideas among the participants as well.  In a sense, the participants become coaches for each other.

Do you have a personal coach?  If so, is it a one-on-one situation or a group setting?  What benefits have you seen from coaching? If you have been benefitted from coaching, then please leave your comments below.

Furthermore, if you want more information about our Coaching Program, then click here.

If you want to learn more financial leadership skills, then download the free 7 Habits of Highly Effective CFOs.

every leader needs a coach

Strategic CFO Lab Member Extra

Access your Flash Report Execution Plan in SCFO Lab. The step-by-step plan to manage your company before your financial statements are prepared.

Click here to access your Execution Plan. Not a Lab Member?

Click here to learn more about SCFO Labs

every leader needs a coach

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LEARN THE ART OF THE CFO