The Day I Left Finance: The Need For CFOs With Broad Reach

Joel Bernstein

Part 2 in the 4-part “SAP Finance and EY Talk” series by Joel Bernstein of SAP and Tony Klimas of EY

Some time ago, after coming up in various finance roles at SAP and elsewhere, I left finance and moved into operations. I think it was the right move.

I’ve since returned to finance. But I was recently reflecting on this move back and forth during a joint interview with Tony Klimas, global performance improvement finance leader at EY. Tony was asked about the changing role of the CFO. His response was interesting.

Secretary of state

Tony says the role of the CFO is increasingly like the role of secretary of state or prime minister. The CFO, in other words, is like the top diplomat for a company. “A CFO needs to think strategically, communicate well, and interact with many different constituencies and stakeholders – from the board to customers to investors,” he says.

I would add the notion of “internal secretary of state” – where it is equally important for the CFO to establish a broad reach within the company, coordinating with all groups internally. Since the finance function is spread horizontally throughout most organizations, this internal diplomat role for the CFO makes sense.

Important for digital transformation

Beyond the benefits of cohesion, the CFO’s ability to coordinate effectively with groups inside and outside the company plays a critical role in digital transformation. To the extent that a transformation effort involves a change in business model – such as moving to the cloud and charging as a subscription – finance needs to be deeply involved. A digital transformation that doesn’t impact finance is a rarity.

Finance can also drive transformation. I’ve written in the past about the transformation of our own finance function here at SAP. Today we leverage a shared-services and Center of Excellence model that allows for the efficient integration of financial processes for newly acquired entities. This helps speed the rate at which SAP can integrate new acquisitions and realize value. Growth, in other words, is easier and faster. Not bad.

A two-way street

What’s important for CFOs is important for other chief execs, as well. I advocate that we all get out of our silos as much as possible and cross-train, as it were. The digital economy demands that companies fire on all cylinders. This means knowledge, coordination, and relationships across all organizations – including finance, operations, HR, sales, customer service, supply chain, and more. That includes external partners and stakeholders.

Much of this is already happening. Tony cited one data point from a report by recruiting firm Korn-Ferry that shows that when it comes to hiring a new CFO, less than 10% of the senior executives surveyed viewed controllership skills as important, while over 50% viewed strategy and general management as the most important skill set for aspiring CFOs.

This is a good thing. In my own experience, moving to operations did more than broaden my scope of vision. It also helped me better understand the role of finance – just as you better understand your home country after living in a foreign country for a time.

Regardless of how one comes to the CFO role, it’s importance for digital transformation is worth reemphasizing. CFOs are trained to understand almost instinctively that whatever action they take, it will show up on a financial statement. Understanding this through and through can be a tremendous benefit for companies as they transform their way to successful profitability in a digital economy.

To learn more about how CFOs can broaden their scope and lead digital transformation, take a look at this animated infographic and Agile Finance 2.0 white paper.

The views reflected in this article are the views of the author and do not necessarily reflect the views of the global EY organization or its member firms.

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Joel Bernstein

About Joel Bernstein

Joel Bernstein is the CFO for SAP Global Field Finance, which includes responsibilities in the Cloud Business Group, Digital Business Services, and Global Customer Operations. In this role, he is responsible for leading the financial activities and profitable revenue growth for the company’s customer go-to-market organization and driving financial support for the Cloud and Professional Services organization. Joel’s direct Field Finance organization includes all finance functions in the multiple regions and market units worldwide for all SAP revenue-generating businesses. Prior to being promoted into this global position, Joel served as CFO for the SAP North America region. There he led all field finance-related activities for the United States and Canada. An accomplished finance professional, Joel earned his Bachelor of Science degree in Accounting at Wilkes University. He is also a member of the American Institute of Certified Public Accountants. Joel is an ardent supporter of SAP’s social corporate responsibility initiatives, often serving as the executive sponsor for programs that connect SAP employees in the communities where they live and work. Reflective of that commitment, Joel is a member of The Franklin Institute’s Board of Trustees, an esteemed organization founded in 1824 whose mission is to inspire a passion for learning about science and technology.