How CFOs Can Deal with Dysfunction

10/25/2024 15:30:00 +0800
Dealing with dysfunction is an inevitable part of the CFO role. It's exhausting, time-consuming, and if they're not careful, it can take the wind out of even the most capable leader's sails. However, there is a simple, effective tactic I use to navigate dysfunction and today I'd like to share it.
 

Over the years, I've learned that dysfunctional dynamics - whether it's within the finance team, across departments, or with external stakeholders - can be navigated with a blend of empathy, curiosity, and a little strategy.

1. What Is the Real Issue?
Let's get real - too often, we spend time putting out fires without understanding where the flames are actually coming from. The first question I always ask is: What is the real issue here?
 

One CFO I worked with thought her team was underperforming on budget submissions. The data showed delays, inaccuracies, and general frustration. But when we dug deeper, we realised the problem wasn't a skills issue - it was trust. Different departments weren't sharing critical information out of fear of having their budgets cut or reallocated, leaving finance in the dark and causing issues with reporting.

When you ask this question, you move beyond symptoms to uncover root causes. It forces everyone involved to stop focusing on the surface and dig deeper into the real, underlying dysfunction.

2. How Can We Align Our Goals?
Misaligned goals are dysfunction's best friend. I can't count the number of times I've walked into a meeting where everyone thought they were working towards the same target, only to realise they were on completely different paths. That's why I always ask: Are we aligned on what we're trying to achieve?
 

Recently, I was working with a CFO whose finance team was constantly at odds with the operations department. The problem? The finance team was hyper-focused on cost reduction, while operations had growth goals that required higher expenditures. They were unknowingly working against each other. Aligning their goals not only eased the tension, but also increased productivity by ensuring everyone was pulling in the same direction.

Alignment is the key to bringing clarity and purpose back into the room.

Patrick Lencioni's leadership fable
'The Five Dysfunctions of a Team' brings to life many
familiar dysfunctions and his proven pathway to overcome them.
3. What Communication Style Works Best Here?
In any dysfunctional situation, it's tempting to assume the issue is the content of the discussion when it's often the how of communication that's the problem. I've seen teams communicate in completely different languages - email vs. face-to-face, big-picture talk vs. granular detail, fast-paced decision-making vs. slow deliberation.
 

I remember a CFO who was on the verge of burnout because his communication style didn't match his team's needs. He was an emailer, shooting off instructions and expecting results. His team, however, worked best with in-person interactions. Once he switched to a more hands-on communication approach, the friction began to ease. Asking What communication style works best here? makes sure everyone is speaking in a way that everyone can understand and it's the fastest way to get to an outcome.

Assumption: "Everyone on the team understands the financial targets and how they align with overall business strategy."
Reality: Some team members might not fully grasp how their daily tasks contribute to achieving broader financial goals. This disconnect can lead to misaligned efforts and missed targets.

 Assumption: "The timeline for delivering the financial report is clear to all departments."
Reality: Different departments may be working off different deadlines, assuming they have more time than they actually do. This can cause last-minute rushes and errors in reporting.

• Assumption: "Stakeholders are aware of the budget constraints for upcoming projects."
Reality: Some stakeholders might be unaware of budget limitations, leading to overspending or proposing initiatives that aren't financially feasible.

Assumption: "Everyone interprets financial data in the same way."
Reality: Different teams may interpret financial reports differently, leading to confusion and miscommunication. One department might see a positive trend, while another could interpret the same data as a warning sign.
Getting these assumptions out in the open can save CFOs and their teams from unnecessary headaches and pave the way for clearer communication and better decision-making.
How Can We Foster Mutual Accountability?
Dysfunctional teams often suffer from a lack of accountability. People point fingers, but no one takes ownership. That's why I always end these conversations by asking: How can we hold each other accountable?
 

In one coaching session, a CFO was facing a crisis of responsibility within her team. Each person was passing accountability to someone else, leading to dropped balls and missed targets. By introducing clear accountability structures - weekly check-ins, action tracking, and real-time feedback - they transformed from a reactive to a proactive team.

Accountability is a cornerstone of any successful finance team. Without it, dysfunction thrives.

How would this process help you get a dysfunctional relationship back on track?

Asking these five questions has transformed countless challenging conversations for me and the CFOs I work with. They help us get to the heart of the matter, align efforts, and move forward with clarity and purpose. All leaders, but especially CFOs can use these questions as their go-to toolkit when dysfunction rears its ugly head. You'll be amazed at the difference they can make.

What's the first question you'll ask the next time you face dysfunction in your role?
Are there assumptions in your team dynamics that need to be brought to light?
How could mutual accountability improve the outcomes for your team?

I'd love to hear your thoughts...

If your CFO is having a hard time managing dysfunction within their business or their team, you need to sign them up for the CFO Boardroom.

The CFO Boardroom is my signature program. In it, CFOs join a confidential community of other CFO's ready to play bigger, increase their impact and elevate the office of the CFO in the next 12 months. Our December intake is now open.

 


Author: Alena Bennett

Alena works with leaders and their teams to connect technical and leadership skills so they can deliver to deadline without killing their people.
 
She is a mentor, trainer, facilitator and coach. Contact her today on [email protected].
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