One of the most crucial elements of success for CFOs is their relationship with the CEO and the board. In an interview with Ajit Kambil, Ph.D., Global Research Director for Deloitte's CFO Program, he draws on his experience designing and leading the Deloitte CFO Transition Lab" to discuss how incoming CFOs can build strong relationships with key stakeholders.

Q: What are some expectations CEOs have that new CFOs need to especially understand?

We've found that most CEOs want the CFO to be an effective business partner with them on the change journey that they are trying to execute in their organisations. You still have to get the accounting and other traditional CFO responsibilities right, but over the longer term the expectation today for CFOs is being the second highest ranking executive in the company.

CFOs also need to be aware of the time expectations CEOs have for them when it comes to driving change in the organisation. Some CEOs can be quite impatient in getting things done quickly. They often want to accelerate change as quickly as possible, and they expect the CFO to support them by driving a lot of change and doing it quickly. There has to be visible and tangible results within 180 days to a year.

Q: So it's important for a CFO to hone in on what the CEO wants to change as soon as possible?

Yes, but more specifically, CFOs have to understand what they really have permission to change. That may sound like the same thing, but it's not. Many times a CEO will tell the new CFO, "We want to change this and that and that," but once the CFO gets to work on making changes, there's push-back from either the CEO or others in the organisation.

Often, the true message from CEOs is that at a high level they want to change the organisation, but at a nuts-and-bolts, tactical level, they really don't want to change this, that, or that. It may well be that the CEO or another business leader has some sacred cows, so to speak—those may be personnel, processes, product lines or something else.

Whatever they are, the new CFO needs to find out what those sacred cows are as soon as possible. Those 'Do not wants' are never really articulated, but figuring those out and triangulating on them may help a new CFO avoid focusing on unproductive efforts and catalysing a change that the CEO does not really want to occur.

Q: How can a CFO figure out what changes to make and what not to make?

There's a cultural due diligence that an incoming CFO needs to do when joining a new company, and that also applies when it comes to the CEO. A new CFO needs to learn the CEO's style, what the CEO might be looking for, what he or she believes in and expects. Interviewing peer executives can be useful to test out some hypotheses of what can be changed and what cannot be changed.

There are a couple of very simple, straightforward questions that CFOs can ask their peers about the CEO: "What has been an issue where you have seen the CEO fire somebody?" "What is an example of something that the CEO did not want to do or change that became very visible to you in the organisation?" Other questions worth asking peers are: "How has the CEO supported your initiatives?" and "Is there an example of when you did not receive adequate support from the CEO?"

Continue reading the interview with Ajit here: http://deloitte.wsj.com/cfo/2012/11/15/lessons-from-the-lab-how-cfos-can-build-a-strong-relationship-with-the-ceo-and-the-board/

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