CFO dot com is always good for a hoot, and an article called “How to Engender a Performance Culture” from a few days ago doesn’t disappoint. The guys who wrote it acknowledge that (1) culture is important and (2) most companies’ cultures are pretty pathetic, then go on to get hopelessly tangled up in their shorts trying to figure out what accountants should do about it.
Nothing too shocking in the chart from some data compiled by Booz & Co: Culture is very important, culture generally stinks, change programs (i.e. lean) work, change programs don’t sustain, the execs (including the CFO) are responsible.
You can go ahead and read the last half of the article where you will learn absolutely nothing at all, if you choose. It has the CFO generally meandering around supporting the culture … whatever that means. Nothing at all about exactly what the culture should be or what is wrong with the current state.
It seems to me the root of the problem is the accounting function. The CFO and his minions should “Engender a Performance Culture” by paying more attention in church – or at least pondering the biblical question posed by Matthew, “"Why do you look at the speck of sawdust in your brother's eye and pay no attention to the plank in your own eye?”
In fact, the CFO might start by reading, re-reading, re-reading again and thinking long and hard about the statement in the article, “The finance function acts as the conscience of the shareholders.” Really? That is the role of the bean counters?
Who, then, acts as the conscience of the employees? The conscience of the customers? The conscience of the suppliers? The conscience of the community?
The role of accounting, according to these guys, starts with “ensuring that management processes and systems are sound; leading the company’s planning, budgeting, and resource allocation processes; and setting the tone and focus of business review sessions.” When all of these processes are designed to protect what accounting perceives to reflect the “conscience of the shareholders” the rest of the stakeholders are inevitably assigned an unimportant role. Do they really think a high performing culture revolves around having the employees, customers, suppliers and the rest aligned in support of the shareholders?
The culture is set and reinforced by the business processes. It doesn’t matter much at all what the CFO or any other exec says about culture, values or any other fluffy thing. What matters is the criteria for decision making. If the quality of decisions is measured by the decision’s contribution to head count minimization and product cost reduction, the culture does not, cannot, and never will be one of employee empowerment and customer focus.
The only culture resulting from CFO’s seeing themselves as the “conscience of the shareholders”, instead of members of the same team as the value creators with critical knowledge – but knowledge no more and no less important than that of the rest of the team – in other words, a high degree of humility – is the sort of dysfunctional culture the Booz poll described.
The bottom line (CFO’s, after all, are ‘bottom line’ kinds of guys) is that the best way for a CFO to “Engender a Performance Culture” is to quit acting like old school CFO’s. Quit seeing yourself as some arm’s length protector of the shareholders’ interests – and who are you protecting them from? The employees, customers and suppliers, of course – and to start acting like, and creating processes in support of the rest of the team.