I was sharing war stories with one of my collaborators this week. An interesting story emerged where ‘poor communication' cost a chief financial officer (CFO) his job.
Because he focused on the data.
Let me explain.
The CFO assumed his role was to provide regular and accurate numbers that the CEO and Board would not just read, but also interpret.
However, the CEO and the Board wanted insights about the company's performance.
This material disconnect cost him his job as the leadership did not see that the company was in major difficulty until late in the piece.
So, what went wrong here?
While I agree that a CFO has a responsibility to explain what the performance data means, I also see a systemic issue that goes beyond the CFO himself. This could have been avoided if
- The CEO and Board asked better questions inside and outside formal Board meetings
- The company secretary clarified expectations that insights were central to the financial reports when the CFO took the role on years previously
- The CEO and the Chair called out the lack of insight in the papers as a general expectation
- The Board did not accept that poor quality papers are commonplace and too hard to fix
I offer this as a cautionary tale.
Quality governance and decision making requires insightful communication both inside and around key papers.
Assuming that the data is enough, or that poor quality papers is ‘par for the course' is not just a risk for you but also for the organisation.
I hope that helps. More next week.
Cutting Through Podcast Now Live
Last week I launched my new podcast, Cutting Through.
My first two posts, a short intro and an interview discussing how to get around one of the biggest challenges when communicating about risk management.
My guest, Anthony Wilson from ABM Risk Management shares deep wisdom stemming from decades in risk and assurance.
He also offers his comprehensive risk management framework.
Listen on your favourite podcasting app or here on my website.
PS – Apologies to those of you who may tried to find it on Spotify, Apple and Google Play last weekend. The episode took longer to publish than we expected.
PRESENTED BY DAVINA STANLEY
Davina has helped smart people all over the world clarify and communicate complex ideas for 20+ years.
She began this work when she joined McKinsey & Company as a communication specialist in Hong Kong where she helped others use the Minto Pyramid PrincipleⓇ.
She continued helping others when living in New York, Tokyo and now back in Australia where she was approved by Barbara Minto herself to teach Pyramid.
Her clients include experts across many disciplines across Australia, Asia Pacific, New Zealand, the UK and the US. She currently coaches a number of C-suite executives as well as many mid-level folk and the occasional graduate.
Get her 4 Tips for Communicating Complex Ideas here.