Editor's note: This interview has been edited for clarity and brevity.
Every leader wants their team to evolve and thrive. To achieve this goal, leaders need to cultivate their leadership capabilities and identify key areas they want to develop within their team.
"Ensuring that training is fit for purpose, rather than a tick-box exercise, is definitely one of the biggest challenges," said Liz Hirst, senior director at Wharton Business Consulting, based in London.
Earlier this year, Wharton Business Consulting partnered with AICPA & CIMA to publish a white paper on the four critical traits a successful finance leader needs to influence the future. They are:
- Connected influencer: actively listens and takes the pulse at all levels of the organisation to gather insights and influence decisions.
- Authentic disruptor: questions existing ways of working and guides strategic change.
- Inquisitive storyteller: connects the dots to tell the real story in the data.
- Rational value creator: looks beyond the numbers to bring true value for all stakeholders.
In the conversation below, Hirst expands on these four critical traits and offers advice on how leaders can develop their teams for the future of finance.
How are the four critical traits connected?
Liz Hirst: I think the golden thread that runs through them and is critical for both finance leaders and their teams is purpose.
Leaders should help their teams understand the purpose of the organisation, the finance function's role in driving that organisational purpose, and critically, each person's individual purpose and how that connects and intersects with the others.
As the world starts to recover from the pandemic, what are ways finance leaders and teams should adapt?
Hirst: It's paramount that leaders prioritise psychological safety by creating an environment in which their people can speak up and, critically, be heard. That's both from a perspective of feeling confident to raise concerns, but also about encouraging innovation so that people across the functions feel enabled to raise new ideas and show up in a way that's authentic and open.
For me, that's where the idea of mindset becomes critical, because we know that organisations globally are now hiring for attitude and they're training for skill. Leaders need to have a growth mindset, as opposed to a fixed mindset, and believe that individuals have the capability and capacity to develop and grow. Individuals with a fixed mindset may well still develop new skills, but they are likely to be focused on incremental, technical skill development — which will be insufficient to address the complexities faced by the finance function of the future.
Finance leaders need to provide clarity to their teams on the wider capabilities, skills, and mindset shifts that are critical for their team and function to take on a strategic finance role. And they need to help their teams to develop those skills and give them the time, opportunity, space, funding, and support to do that.
What are some of the day-to-day actions of a successful "connected influencer", and how can finance leaders develop that trait across their teams?
Hirst: I think one of the most important behaviours leaders at all levels can demonstrate is active listening. It's about creating the time, space, and environment for people to say what they think without fear of reprimand or consequence. It's also about genuine curiosity — finance leaders must show that they are interested in what the speaker has to say, inviting them to continue to speak by listening attentively and seeking to understand alternative perspectives. This will help them connect with new stakeholders and form linkages between information points they may otherwise have discarded as less relevant.
Phrases like "My door is always open" do not actually encourage change, and it is placing the responsibility on others, usually more junior people, to step out of their comfort zone and into the comfort zone of the leader. People usually feel safer in their own space. As leaders they should be respectful, actively going out to their people, rather than asking people to come to them if they truly want to hear the reality experienced by others.
I think the other aspect to listening that's critical to develop is responding to both verbal and nonverbal cues. It's often harder in a hybrid or remote world where we're interacting with each other through computer screens, but recognising people's body language, eye contact, and tone is important. Sometimes listening to what is not being said or what people avoid doing can be very powerful to understand what really needs to change or what can be influenced.
By focusing on developing active listening skills, finance leaders can create more authentic, trusted relationships with a wider range of their stakeholders, and that ultimately gives them the remit or mandate to influence others and connect people and data to join the dots and make decisions.
Some of the other day-to-day actions might be reaching out to stakeholders, linking up new people where they think there's an area of interest, and always looking for external or new data sources.
What are the ways finance leaders can encourage their teams to be "authentic disruptors", and what areas do you foresee being ripe for disruption in the near future?
Hirst: While I think being an authentic disruptor is likely to be the biggest gap for most organisations, as it is also the most complicated for an organisation to adopt.
To be an authentic disruptor you need to ensure you're evoking many of the other traits. You need to be actively listening to have a pulse on the organisation, you need to know how to engage stakeholders, and how to use curiosity and questioning to gather insight. You then need to use those insights to garner support for the change and get other people to lead with that disruptive mindset as well.
One of the areas I think is ripe for disruption is ESG (environmental, social, and corporate governance). Employees are demanding organisations respond to challenges around sustainability, inclusion, and societal impact. As the concept continues to evolve and develop further, finance teams need to think about how they can disrupt their own business models to put ESG decisions right at the front and centre of the business strategy. Critically, they need to do this in a way that delivers and provides clarity on the value of those decisions to the business's strategic ambitions, even when the link to the tangible business value might not be quite as evident. This is when finance leaders can lean on the trait of being a "rational value creator", as developing this mindset emphasises the use of judgement to confront complexity and identify and pursue new forms of value that are critical to business success.
Do you predict storytelling will become increasingly important for finance professionals?
Hirst: Storytelling enables leaders to engage their teams with a compelling narrative that evolves over time as the business progresses. Storytelling might not seem obvious as a skill needed in the data rational, numerical world of finance, but without it key financial messages risk being lost in the sheer volume of messages and conflicting expectations we experience every day in our personal and professional lives. Storytelling is what makes any message more powerful, persuasive, and "sticky" to bring about change.
Leaders should invest in professional development on effective storytelling and make sure storytelling is built into every team meeting. They can ask their more junior team members to really think through which data points relate directly to the story they're telling, and which potentially don't. Finance professionals should also test stories out with someone outside of the finance function to see how they land.
Which of the four traits do you think will be most important in the future?
Hirst: All of these traits will be critical to becoming a future-focused finance leader, and I would be encouraging leaders to reflect instead on where they feel they may have the biggest gap currently. But one of the most important attributes or mindsets finance leaders and their teams can harness that underpins all of the traits I believe is the power of curiosity.
Curiosity is often stifled as we develop our careers, but there are ways to recultivate it. Within the four traits, curiosity mostly sits under the inquisitive storyteller, but it also applies to the connected influencer, who asks exploratory questions and connects the dots between various sources of information.
Something like 85% of finance teams are either undergoing or planning a finance transformation, but in reality, 70% of those initiatives are failing to deliver the benefits. I think finance leaders need curiosity in their teams to understand why they are failing and how to deliver a more human-centric approach to those transformations. Are you really exploring why you want to undertake the transformation or the different approaches you could take?
What are some ways finance leaders can make sure people at all levels of their organisations and across the finance function develop essential leadership skills?
Hirst: Leadership skills are not for leaders alone.
To create a learning culture, the first step is giving your people permission to take the time to develop.
As a leader you can provide the best development opportunities, learning, and courses in the world, but unless people have the time to dedicate to that training and, more importantly, the time and support to go back and practise applying it to their jobs, they're not going to reap all the benefits.
Professional education is helpful, but experiential learning is critical, whether through a cross-functional working group, volunteering, peer learning, or stretch assignments.
Leaders should help individuals understand the range of things available to them and provide some examples of career paths and journeys to help them understand how they navigate their career in the organisation, which can ultimately help to retain and develop that top talent.
Leaders also need to take an active role in development. They can discuss the skills they are still developing and where their weaknesses might be. Seeking 360 feedback from their team on some of those leadership skills can be powerful.
Finally, leaders need to role-model their personal commitment to their own development. The idea of leaders being vulnerable, honest, and open is one of the critical benefits we saw coming out of the pandemic, but I think it could be very easy for leaders to flip back into acting like they know all the answers. Witnessing your senior team actively undertaking development gives a clear message to the whole business that this matters to success.
— Hannah Pitstick is a content writer at the Association of International Certified Professional Accountants, representing AICPA & CIMA. To comment on this article, contact Oliver Rowe at Oliver.Rowe@aicpa-cima.com.
How Finance Leaders Influence the Future
This white paper compiles and examines insights and perspectives gathered through in-depth interviews with finance leaders that provide understanding of what was needed to successfully evolve their teams.
Effective story telling techniques for prospects and clients
This highly practical and interactive one-day workshop will help guide delegates through the power of storytelling and how it can be utilised to cement key messages and drive engagement. 23 November 2022