Editor’s note: This article is part of the “Top Finance Skills” series, featuring insights from finance leaders across industries on skills finance professionals need to have to be competitive in the future. To receive weekly updates on this series, sign up for our CGMA Advantage newsletter.
As the pandemic forced people to stay inside their homes — working, studying, and running businesses, as well as finding leisure and entertainment online — one industry that had to immediately cater for a huge demand surge was the telecoms sector. Data traffic increased significantly worldwide.
Ericsson, a global information and communications technology leader headquartered in Stockholm, Sweden, with operations in over 180 countries, reported a gross margin of 40.3%, up from 37.3% the year before, with improvements in all segments, according to the company’s 2020 annual report. Its operating income improved to SEK 27.8 billion ($3.25 billion) and net income was SEK 17.6 billion ($2.06 billion).
Sustainability and creating long-term value remain key, as the company announced its ambition is to grow faster than the market. Clearly this requires the leadership to evolve and innovate more employee-friendly ways to steer the organisation.
Jesmin Ehsan, ACMA, CGMA, Ericsson’s business controller for Singapore, Brunei, Philippines, and Pacific Islands markets, shared with FM magazine the importance for finance professionals to understand the story behind financial information in order to communicate it well.
What do you consider your number one professional challenge?
Jesmin Ehsan: The art of communication and storytelling. We finance people generally like to investigate and get to the bottom of the numbers; details are like part of our life. But as a part of a finance leadership team in Southeast Asia, Oceania, and India, I also need to present the complexity of our business to the global management team that does not have visibility into our daily activities and challenges.
So my biggest challenge is how to report the complexity that we face on the ground to senior executives. In such situations, the art of storytelling becomes the most important skill. Being a finance person, I tend to go into details, but they usually do not have the time. My task is to summarise a super complex thing in layman’s language, and to make the numbers talk and become relevant and alive for everyone's understanding.
In your view, which skills are most lacking amongst finance professionals?
Ehsan: Communication again. As finance professionals, we talk with sales organisations, country unit heads, and our various stakeholders who don’t necessarily have a finance background. So how do we make them understand our story? Not being able to simplify the problem is a general issue that I see in the finance community.
There is a preconceived notion that storytelling is the job of the salesman. I don't believe that. As finance professionals, we sometimes work as internal “salespeople”, convincing and interacting across the organisation, and we need to be able to do this storytelling and communication better.
Also, I think it is very important for finance people to stay open-minded. There is a big misconception about finance that you go to finance with a request and they’ll say no to you. In my role, I encounter a lot of situations where people from sales and other departments come to me with very innovative solutions. As a finance person, when I look at these, I want to keep an open mind and understand where they are coming from. I want to get to the bottom of the problem that they are trying to solve. When I share my insights and can show them a way to solve the problem that is also more favourable for the books while ensuring compliance, people become more receptive towards the solution.
How can finance executives promote collaboration and business partnering across the company?
Ehsan: At Ericsson, we have this value set called “Ericsson on the Move”, which defines our culture. The five focus areas are namely empathy and humanness, cooperation and collaboration, fact-based and courageous decisions, executing speedily, and fostering a speak-up environment.
All these point towards how we can work better not only within our teams but also across the organisation to help support the business and move forward with the business.
I have to work very closely with sales and delivery. For me to be able to guide them, I must learn their processes. When I talk to a salesperson, I ask him about the process from the customer side; how is he signing the contracts? When I'm talking with the delivery organisation, I'm asking about the steps of delivery. I can tell them the stage at which they are transferring the control to the customer based on that information.
A lot of people outside finance do not understand the terms we use for revenue, etc., so it requires constant dialogue and learning from each other. For example, I sit in the procurement board, and I'm one of the decision-makers. If someone comes with payment terms for a vendor, I have to give the perspective of how it would look in our books. If I do not share my view with them, they will not understand where I am coming from.
The most important thing here is to include ourselves from the beginning of the process. If we are involved after everything is done, we don't have much to contribute. It becomes a firefighting situation. Numbers are always lagging measures. Whatever we have already done is reflected in the numbers. As a finance person, it's important that we influence the leading measures, that is, what is generating the numbers.
Also as finance people, we need to keep an open mind because organisations are changing, disciplines are changing, and we are working in environments where technology is moving so fast. Of course, we are guided by our accounting principles, so our knowledge there is super important. To understand the heart of the problem and bring various information together to solve a problem is how we build relationships with our cross-functional teams, and also to keep ourselves relevant.
How do you see the responsibilities of finance professionals changing during the next five years and why?
Ehsan: I think the responsibilities of finance professionals are already changing. If you do not understand the business, you will never be able to make the link of where your revenue is coming from.
We need to understand the delivery, too. Since I work in a technology company, it's very important to understand how the technology is moving and growing, the importance of AI and digitisation. We used to do a lot of things manually like downloading reports and creating tables. Now we have an automation department, which downloads the reports for all management users and adds comments to the reports. So instead of focusing on the history, I can look at the trends. I can focus on the future.
So automation and digitisation, these things will change our work, and we need to keep learning and evolving. We cannot say this is not finance, this is operations, or this is sales, or this is sourcing. We must understand what these guys are doing because at the end of the day, how our company is performing is reflected in their numbers, and we are the responsible party. We have to know what is generating the financial numbers.
What are professional skills you plan to learn?
Ehsan: Data analytics. I enrolled myself in an in-house course this year where I will learn about the basics of data analysis. We need to know how to do these, how to use AI so that we do not spend too much time on manual reports but rather on business modelling, risk management, or governance and compliance, which are all very important for the company. Ericsson has a fantastic training culture, and we have the option to choose different courses.
If you were just starting out in your management accounting career, which skills or aspects of finance would you be focusing on to get a competitive edge?
Ehsan: When I started working in finance, I was already a business graduate, so I understood business. But I was not a professional accountant. After working for some time in different countries, I recognised my calling and decided to get my professional qualification. That’s when I got my CIMA qualification. But it was late — it was a few years after starting my finance career. If I started now, I’d tell myself to do these professional courses earlier so I am equipped to handle the business. I learned the business first, and then started making the link with accounting. But the moment I did CIMA, I could see the linkages, and it all became very easy.
How does Ericsson support finance team members in their professional growth?
Ehsan: Ericsson has an excellent culture of inducing learning. When I chose to do CIMA, my boss encouraged me wholeheartedly. I was attending classes, which were three days a week, and I had to take leave during exams. This was well communicated, well adjusted, and well aligned with my manager. Typically, in Ericsson, managers or leaders will never hinder anyone. We get that kind of flexibility and support because the way I see this is, if our people are learning more, they will add much more value to our organisation. We get in-house trainings, but at the same time, if we want to go and do something from an external organisation, the company supports us, too.
Rapid fire questions
What’s the number one skill a finance professional should have?
What’s the most important action finance professionals should take to advance their careers?
Ehsan: Learn and grow as much as possible and not only in your finance area. Understand other expertise as well such as project management, Six Sigma. Because, why not?
— Swati Sanyal Tarafdar is a freelance writer based in India. To comment on this article or to suggest an idea for another article, contact Alexis See Tho, an FM magazine associate editor, at Alexis.SeeTho@aicpa-cima.com.