…continued from Corporate Language 1
Financial awareness and literacy were crucial to survive…while as almost always, we shifted to another extreme…
The long neglected control, planning and whistleblowing functions of Corporate Finance were slowly turning into the AIM, rather than TOOLS…
People were constantly receiving e-mail’s with huge Excel attachments, from Finance department, asking for reports, forecasts, comments for anything and everything they were doing. Marketing people who were supposed to make consumer visits to understand their habits and attitudes or Sales Managers (sometimes even supervisors) whose real job was to meet Customers on the field to SELL, had to stay in the office to crunch numbers for hours on excel sheets to hand in the reports or forecasts before the deadline, hoping that their difficult to satisfy Finance Colleagues would let them do things…
Having so many NUMBERS to compile, Finance departments were swelling, too. More analysts, more controllers, more auditors were needed.
Complaints were shared during coffee breaks or happy hours, about how people were paralyzed by Finance departments’ never ending demands.
Naturally, something had to be done about this…
“EUREKA!” said a smart HR manager:
“Why don’t we teach NON FINANCE people, some FINANCE?!”
Since then, probably this became one of the most universal training subjects in various companies.
But, as always, no one had that much time to dedicate to this kind of FUN; at the end of the day, it was always a Budgeting, Strategic Planning, Month Closing, Rolling Forecast revision, scorecard, etc…period. Neither Finance, nor others had more than a couple of hours to spend with this, so this had to be a short training.
They gathered in a nice room with cookies and coffee and listened to that Controller who taught them the components of P&L simply by stating and repeating the meaning of each line and most of the time no one really had the will or energy to go beyond the EBIT, anyway, so following a P&L exercise, they all went back to their rooms not to miss the deadline of that report!
Don’t get me wrong, here!
I am not against cross functional trainings. I value a lot, the financial literacy of anyone and everyone in today’s tough times…but, hey! Are we doing the right thing, the right way, with the right end products?
Let’s have a look:
Probably within the following 24 hours, most of the things learned during that training was definitely forgotten, simply because:
a) That marketing girl with her laptop was replying an urgent email from an agency about the fee they proposed
b) That sales supervisor had to take that call from his biggest client who wanted an explanation why the terms and conditions set were proposed to be changed
c) This was not interesting at all for the Customer Service girl.
Besides, why does not anyone talk about training the finance people about NON FINANCE, so that they could understand things which determine others’ and ultimately the company’s performance? Is COUNTING and SAVING the money more important than MAKING it?
I have not heard any such training, have you?
One note to those who think that all Finance People are having a sadistic pleasure from the way things are being done:
Go and talk to a CFO or a financial planning manager who works overtime almost throughout the year.
His/her life more or less looks like this:
(S)he starts the budget process end August, collects tons of spreadsheets (usually received from HQ) filled in by others for months, to put together the Budget File to be presented UPSTAIRS (of course, after correcting time and time again, the mistakes made by others who were too busy to pay attention to what was really asked for) knowing already that inevitably all these efforts would go down the drain his/her boss coming out of the Budget Presentation to tell him/her that this was all to be changed, as the Executive committee wanted the budget to be revised, because they thought this “pre”budget (which was merely a consolidation of the inputs by people bottom up, who lived the real life) was far too unambitious based on the fact that…..on the fact that…..errrrmmmm…well, can we switch off the camera here for a second?!
Another tour of (this time top down) revision and here we are…end of December, there is a Budget AGREED, although with all the changes made, everyone knows that even January figures are totally bullshit, anyway.
Of course, during those months life could not and did not stop!
There were still monthly closings, ad-hoc reports, explanations/comments asked for, by the HQ.
Here we are in January!
A new year with many new year’s resolutions (this year I will see my daughter at least 1 evening a week!) is beginning…oh, what an excitement!
Then the wake-up call comes…
- Listen, we have a problem here! The HQ is asking for an urgent conf call about why we were below budget in January.
- But we told them that this budget was not realistic and….
- Don’t you think I told them? They simply say: Whatever… Budget is a commitment…”
- But this is ridiculous…
- Shhhh… Organize a meeting with Sales and Marketing to give me a couple of good arguments…bad weather, good weather, the conflict between the government and army, whatever…they should be creative and credible…well maybe if not credible, at least difficult to prove otherwise!
- But, shouldn’t we maybe…
- DIT DIT DIT DIIIIIIIIIIIIIIIIIIT!
- Hello? Hello? …..
Yes, the year has started…
Of course, right from March on, you start handing in periodic revisions (Rev 1, Rev 2, Rev3)…endless discussions, conflicts, top down number crunching…and yes, it’s BUDGET TIME AGAIIIIIIN!!!
People from all over the Organization, strangled by that long sentence in FINANCEE had started to be the slaves of endless reports and useless and absolutely UNREAL set of plans stuffed with crunched numbers.
The organizations were simply paralyzed…. (to be continued)
Eric Bilginoglu is a member of PRAKHSIS’ Executive Board of Advisers. He provides expertise and perspective in the FMCG sector for executive advisory, M&A advisory, executive search assignments. He may also be booked as a corporate speaker. Eric maybe reached at firstname.lastname@example.org