CFO.com has brought to my attention a survey conducted by the CEB of finance managers. They asked finance managers whether they believe their direct reports are “effective in the behaviors and skills that drive excellent performance by the finance function.” The title of CFO.com’s article gave away the answer: Finance Leaders Bemoan Talent Shortage. Not only that, but they’re good at the stuff that sucks and suck at the stuff that’s good:
And on average, finance workers are more skilled in the areas that have the least positive impact on value creation.
You know how everyone likes to think they’re above average? Above average driver, above average intelligence, etc.? This is that. Finance managers believe they’re above average at their jobs, therefore those around them are likely below them, and possibly even below average. It’s OK. They’re human.
I also think there’s an element of confirmation bias at play. They’re finance managers, so they must be above average and have the skills and behaviours that the survey indicates is important.
But back to those hapless direct reports: First, who hired them? If it was those selfsame finance managers, shouldn’t that reflect poorly on their ability to assess competence and develop talent? Whose responsibility is it to put in place succession and training plans? (HR’s, they’d probably say, if surveyed about it.)
Overall, finance managers appear quite dissatisfied with the talent levels on their teams. [The CEB] acknowledges as much. “We weren’t particularly surprised that the ratings were so low,” she says. In fact, she adds, one reason CEB did a report on talent is that when it conducted its annual interviews with CFOs last year, 85 percent said talent was a major concern.
I’m not surprised either. This is never going to stop, until robots run companies completely. Even then we’ll probably sneak a “dissatisfied with direct report talent levels” easter egg into the code, just so robot CEB surveyors can have something to write about. What a chilling dystopian vision; I think the living will envy the dead.
Mercilessly, it continues:
Effective delegating is a capability many finance departments sorely need. “After the financial crisis, finance is overwhelmed with ad-hoc requests,” the report states.
If you’re delegating to staff that you don’t have (because they were all downsized during the recession), it isn’t going to be very effective. Perhaps that’s the reason they’re feeling overwhelmed?
There’s a reason why great people are hard to find: they’re scarce. And once found, smart managers do everything they can to keep them. As well, it’s highly likely those yearned-for “persuaders, strategists and builders” recognize a good situation when they have it. Perhaps that’s the most important takeaway here for finance managers. Build it, and they will come.
Following an earlier post about how clean smells were correlated with more ethically minded decision making is this HBR post about good lighting encouraging the same thing:
In one laboratory experiment, we placed participants in a dimly or well-lit room and asked them to complete 20 math problems under time pressure. The participants received a cash bonus for every correct answer. Since we were interested in whether darkness affects cheating rates, we left it up to the participants to score their own work and to pay themselves from a supply of money they had received at the beginning of the study. While there was no difference in actual performance on the math problems, almost 61 percent of the participants in the slightly dim room cheated while “only” 24 percent of those in a well-lit room did. Eight additional fluorescent lights in the room where the study took place reduced dishonesty by about 37 percent.
They also performed the test based on the perception of lighting levels using sunglasses, and had similar results.
I anxiously await the results of a combination of smell and lighting!
But why stop there? What else in the sensory-ethics world can we adjust and test? Sounds? Tastes? Should we all be chewing mint gum every day and listening to waves crashing onto the shore?
The question is: could this be taken too far? How brutally honest do we want our co-workers to be with us? At least in the interests of getting along, perhaps some things are better left in the dark.
Canada’s federal government recently announced a Start-Up Visa Program aimed at attracting international entrepreneurs to the country.
Overall it is sending the right message to global entrepreneurs, that Canada welcomes them and their ideas in the hopes of creating jobs in here in an area of growth.
I hope it won’t create an uneven playing field against homegrown entrepreneurs, but my contacts in the industry think it’ll be a net positive. Deal flow will increase in Canada, which will benefit existing start-ups and innovators. The rising tide of more money sloshing around this part of the economy will lift all the boats, as it were.
Existing companies stand to benefit from at least one of the explicit goals of the Program, which is to bring in motivated individuals from around the world, deepening the talent pool for all companies.
What do you think?
One of the bigger news stories in Canada of late is the ongoing hunger strike of a First Nations chief, ostensibly being carried out to force a meeting with the Prime Minister to discuss conditions on the remote northern Ontario Attawapiskat reservation.
The legacy of the “discovery” and settlement of North America by Europeans and their subsequent relationship with natives is a topic far too complex for this blog, but the story took on an element of particular interest with the “leak” of a Deloitte audit report on the administration of the community.
That report has been posted online in its entirety.
Deloitte sampled 400 transactions from the G/L across the 6⅔ years in scope. Sixty per year and 40 for the eight month period ending November 30, 2011. Slightly less than 20% of the 400 had no issues. No supporting documentation was available for just over 60% of the sample, and the other 20% was either incomplete or the occurrence of the underlying event was questionable. It should be noted though that in the most recent 20 months reviewed, only for 31 of the 100 samples was there no supporting documentation.
What the audit didn’t do (and wasn’t designed to) was determine whether $104M over that time period is adequate for the population on the reserve. It’d be an interesting analysis to look at the number of households, average people per household, repairs and maintenance funding per household and per person, and figure out whether there is enough funding to support their needs or not. That’s the heart of the issue.
CFO.com had a provocatively titled article this morning that just shouted out for a retort: “Is Accounting Blocking R&D Investments?”
Now how could accounting be doing that? Why, because senior management is preoccupied with meeting short-term quarterly earnings targets, and are cutting back on longer-term focused R&D investments!
I thought this was just an overzealous headline writer, out to get clicks (mission accomplished!) and perhaps the article itself would walk back the ridiculous premise, but instead it doubled down:
The accounting treatment of R&D as a period expense and the overemphasis many public-company executives place on EPS. Many executives pay lip service to the long term benefits of R&D. But in reality they base the size of their companies’ R&D budgets primarily on a single period’s EPS dilution. Thus, they are only looking at a tiny fraction of the value equation.
It’s gotta be up to management to teach the market how to appropriately value their company, and it’s gotta be management that shares a long-term vision of sustainable profitability to shareholders. This short-termism simply has to stop.
It isn’t the accountants who are pushing for quarterly earnings reports. I’m sure accountants would love to spread out the reporting, it would make their lives a lot easier not to have to calculate myriad accruals on a quarterly basis only to reverse them after.
Value, real lasting value, not just for shareholders but employees and communities, is built over the long haul.