Another Misunderstood Accountant

R-E-S-P-E-C-T

One thing I like about being a consultant is that I meet quite a few people. Some of these people have become great allies and supporters of this work and these relationships past the engagements that brought us together last year.  We have supported each other over the years, supported each other through high times and low times, and most importantly, troubleshot together and helped one another solve complex problems.

One such person, a COO by trade, reached out to me recently with this

Hey there,
Was wondering if you had any quick words of wisdom for me with a little challenge I have. The finance team at my new spot doesn’t get a lot of respect…for a number of reasons. I was thinking about ways to raise their profile a bit while I work to raise their spirits.I was thinking along the lines of capturing and sharing a few key data points that might open certain eyes to the good work that they do. For example, how many POs they process in a week, days sales outstanding, days payables outstanding, stuff like that?Have you come across any relevant KPI that might help me in this makeover?
Thanks a million in advance.

COO

I chuckled a bit as I read this.  Another accounting department is getting a bad rap. I roll my eyes. If I had a dollar for every person I had explained the discipline of accounting and the role of an accountant in the organization’s strategic growth, I would be fishing now instead of writing this blog post. This is a thing. But why?

I DON’T WANT TO BE AN ACCOUNTANT

Maybe you don’t know I have a Master’s degree in Accounting. Perhaps you do know that I am a relatively technically solid accountant. As a company-builder, I always look to financial operations as the basis for demonstrating my skill in aligning people, processes & technology to drive enterprise value. I am a geek! An accounting geek! Many CFOs have an accounting background. Many have an audit background. I do not have an audit background unless you include the audits on which I have paid for and received opinions. Why is that? I am not a CPA. Once upon a long time ago, I signed up to take a few sections of the CPA exam as I qualified to sit and applied here in Massachusetts. But I decided not to show up. I ditched the CPA exam. Why? I did not want to be pigeonholed as an accountant. I did not want to be subjected to the stereotype of an accountant.  

When I submitted my graduate school application in 1999, I recall making a Faustian bargain. I wanted to be a CFO, I knew I needed an accounting background to get beyond an analyst or FP&A role, and I knew I did not want to be an accountant (although I very much wanted to be a CFO).

Accountants are seen as rule-driven technocrats with minimal personality and minimal creative thinking abilities. 

I mean, one’s work does not define one’s abilities or personality. Nobody says, “I wish the employees of favorite Dunkin’ Donuts were less rule-driven.” Or, “I wish the building inspector had more creative-thinking abilities.” How about “I wish the firefighter had more personality.” 

Why? Because the role of an accountant is misunderstood. I mean that.

THE ACCOUNTANT’S ROLE IS CRITICAL FOR GROWTH

An accountant’s role in the business is to apply a set of rules known as the United States Generally Accepted Accounting Principles to the economic activity of an organization. Since the rules are vast and apply to all monetary transactions – every dollar spent, every contract signed – many roles and responsibilities are included in executing this. Organizations that do this well have high-quality financial statements that help guide management decision-making, help build organizational strategy, and open up doors for growth, access to capital, and the ability to benchmark one’s performance with others. 

I remember my very first accounting class. Accounting 101. Literally. The professor told us we were all here because, after the Great Depression, investors needed a way to independently validate a company’s performance so they could make an investment decision. The investor community needed a way to compare companies’ performance such that they could apply their “special sauce” and make money. Our professor said this was the genesis of insider trading, the modern SEC, and the rise of the CPA designation.

Is that true? No idea. But it is stuck with me. The notion of accountants fulfilling a vast and complex mission inspired me.  Not to become a CPA but to build companies and teams that value every member, even those that sit at their desk and process paperwork daily.

Here is what I wrote back to my friend

Hey!!!

This is not an uncommon problem. Often people have no idea what a finance department does, and if they do, they think it is boring work executed by unskilled people.

This last week I was asked to present to an exec team I am working with. I was asked to present what I was doing in the short term and long term. I started by asking them each what they thought the role of the CFO was. One by one around the room. Then shared HBR and Delloite’s rubric on the same. They all actually thought that the CFO’s job was to build models and maintain financial statements. 
The excellent work they do I would separate from the (necessary) work they do.

I like to describe it like this- a finance team is like air. You don’t think about it until you don’t have it, yet it is equally as necessary for everyday life. Everyone walks around saying I need water but nobody walks around saying I need air. That’s because good finance teams know this and they just function so well and so ubiquitously since they do not get the same latitude as say, the sales team does. Nobody rings a bell when bank accounts are reconciled, that is for sure. 

All the best,