Welcome to the Count Me In Podcast, where we bring you conversations with top industry professionals and thought leaders. In this episode, host Adam Larson sits down with Jonathan Smalley, Co-Founder at Proxymity, for a deep dive into shareholder engagement in the corporate world. They discuss the critical importance of strengthening shareholder engagement, the impact on investor relations, and the ongoing digital transformation of proxy voting. If you want to gain insider insights and valuable advice from industry experts, you've come to the right place. Tune in to hear their engaging discussion on the future of shareholder communication and the evolving landscape of corporate governance.

Welcome to Count Me In! Join host Adam Larson and special guest Rick Watson, CEO of Protection Point Advisor, founder of the National Referral Network and author of A Firm Worth Building. They dive into inspiring stories and insights on leadership, company culture, and business success. Get ready for engaging conversations and valuable business wisdom from industry experts like Rick, who shares his journey and expertise in changing company culture. Embrace the CEO mindset and gain powerful leadership tips with Count Me In! 

Join host Adam Larson as he sits down with distinguished guest Norman Strauss in the latest episode of the Count Me In. Listen as they share engaging stories and insights from Strauss's 60-year career in accounting. From the challenges of embracing technological changes to his pivotal role in standard-setting committees, Strauss reveals the highs and lows of a lifelong journey in the accounting profession. It's a candid and valuable conversation that you won't want to miss! 

Welcome to the Count Me In Podcast! Join host Adam Larson as he chats with the insightful Yerbol Orynbayev, a seasoned leader with a wealth of experience in both the public and private sectors. Yerbol shares compelling stories and lessons from his remarkable career, including his tenure as the deputy prime minister of Kazakhstan and his pivotal role in restructuring a major bank. His candid insights and practical advice are sure to inspire aspiring leaders and entrepreneurs. Tune in for an engaging conversation packed with real-world insights and takeaways! 

Join Adam Larson on the Count Me In Podcast as he sits down with the insightful Ahmed Hassan to explore how financial leadership has shot into a new era. Ahmed, an esteemed finance executive and IMA Global board member, shares how the roles in finance have shifted from traditional number-crunching to proactive, strategic business partnering.Listen in as they discuss the impact of digital tech, COVID-19, and sustainability on financial strategies, the importance of people skills, and the rise of data analytics in decision-making. Ahmed backs up the talk with his journey in embracing change, leveraging automation for insightful analysis, and his advocacy for continuous learning through the IMA.This episode offers a treasure trove of knowledge for finance professionals looking to adapt to the evolving demands of the industry. If you're curious about the future of financial strategy or keen on understanding the shifting focus in finance, this conversation is your must-listen. So sit back, tune in, and get inspired to take on the financial world with a fresh, informed perspective!

Join host Adam Larson and special guest Connie Siu, President of CDC Synectics Inc and an author, as they unpack the complexities of building a data-driven culture in the business world. Tune in to this episode to discover the essential characteristics and challenges of fostering a data-driven environment within an organization. Adam and Connie provide valuable insights and practical advice on overcoming obstacles, assessing effectiveness, and turning data into informed decisions. Get ready to explore how a data-driven culture can revolutionize your approach to business!Full Episode Transcript: < Intro>  Adam:            Welcome to another insightful episode of Count Me In. Today, we're delving into the topic of building a data-driven culture with our esteemed guest, Connie Siu, President of CDC Synectics Incorporated, and an accomplished author. Join us, as Connie shares her expertise on essential elements of data-driven culture within an organization, and the significant impact it has on today's business environment. Stay tuned, as we explore key challenges faced during the transition, and gain valuable insights on assessing the effectiveness of a data-driven culture. This episode promises to offer valuable insights, into the power of data-driven decision-making in shaping organizational cultures and driving business success. Let's get started. < Music > Well, Connie, we want to thank you so much for coming back on the Count Me In podcast. And, today, we're going to be talking about data-driven culture and what that means. And, so, maybe, we can start off, you can elaborate what constitutes having a data-driven culture within an organization, and why is it essential, especially, in business today? Connie:           That's a great start, Adam. Data-driven culture is the consistent values and beliefs in distilling insights from data to drive informed decision making, and that's happening across the whole organization. And I would offer three characteristics that you can look for, in an organization, where there's a data-driven culture. The first one is you will see individuals and teams actively asking themselves questions like, "What information we can draw on to support and guide decisions." You will see consistent efforts devoted to pull relevant data to analyze an issue. And you will see open and frank dialogues on understanding the root cause of a problem by looking closely at KPIs. In terms of why it is essential for businesses today, there are four factors, two external and two internal, that are important to bear in mind. The first external factor is the competitive marketplace. Companies need focused strategies to target the right markets, to differentiate themselves to compete, and they need the market intelligence to develop focused strategies. The second external factor is digital transformation. The ability to adopt the right technologies to drive business outcomes is critical. Successful digital transformation involves using technology to capture relevant data and analyze the results. To automate processes, for instance, companies need to know what data is important and what's not. The internal factors: The first one is operational efficiency. Businesses need to be efficient today, and we are aware that costs are going up, labor, materials. And with the current inflation, companies need to have a good handle on the numbers.The second internal factor is the need to treat data as a strategic asset. Every business has tons of data. Imagine if you can mine the data for intelligence, they will uncover lots of opportunities to make all kinds of improvements, such as targeting high-margin niche markets. So these four factors require an appreciation of making smart choices from data analytics. It is more important than ever, to build a data-driven culture. Adam:            Yes, I think those are some great factors to take into consideration, especially, if you recognize that your organization doesn't have that data-driven culture. Maybe we can talk about some key challenges that organizations face when they're trying to transition to that. Because it's not something that happens overnight, something that you can turn a switch and say, "Hey, we're a data-driven culture." It's something that builds over time, I'm sure. Connie:           Yes, there are two key challenges I'd like to share. The first one is the lack of technical capabilities. And when I say technical capabilities, they include the skills to identify what data, or KPIs, are relevant to look at. They include skills to analyze the numbers. For instance, how do you know you have achieved efficiency improvement? What would you look at to monitor process performance? Do you want to look at the results on a weekly basis or it makes better sense to compare month-over-month changes? And there are many data points you can look at, but not all of them are relevant. Once you have the data, you need the tools to capture, compile, and analyze them. And many companies are still using legacy systems that are not integrated. So it is a tedious and often very frustrating exercise to extract the data. And to overcome that lack of technical capabilities, start with training. Training the fundamental skills on asking good questions to identify what data do we need to look at. Training on the skills to analyze an issue. And I would suggest training everyone from the executives to people working on the front line. We don't need to train everyone to be a data scientist, but we do need them to have the basic skills to ask good questions. To understand what they need to look at, and become good problem solvers. And in terms of the legacy systems, there's only so much you can do patching them. Eventually, you need to invest in modern technologies, and there are so many options out there today, and there's no need, and I want to emphasize this, it's not necessary to invest in the most comprehensive ERP. The key is to find the right applications that meet your business needs. Now, the second challenge I'd like to talk about is the lack of buy-in. When you don't have the support of the senior management team and the middle managers, it is very difficult to make that shift. Now, middle managers are accountable for the team's performance. So that fear of poor results is natural because they reflect on their leadership skills, and no one wants to look bad.When middle managers shy away from results reporting, they tend to do the minimal, just what is needed. Essentially they create an alignment where there's little incentive for the team to embrace analytics. Now, when we look at the senior management team, when there's no buy-in, from them, on analytics, you tend to see an authoritative management style. Top-down decisions will become directives for the teams to execute. And in this situation, the efforts made on analytics are not valued at all. To overcome the lack of support, start with understanding what the dynamics is today and find your champion. That champion could be a team leader for a small group, a middle manager, or an executive. Someone who is receptive to analytics, open to discussing results, and also willing to devote the time and effort to data analytics. And once you have that champion, pick a problem to tackle and develop a game plan, and that game plan has got to be practical, for folks who will be doing the work. Include, in your game plan; How you're going to capture the data.What tool you're going to use?Who is going to do the analysis?What forum you're going to bring folks together to discuss the results?Who is going to make the decision on what action to take, and implement the improvements? And, then, go through the cycle of monitoring the results and refine your changes. So those are the key points on overcoming the lack of buy-in. Adam:            Yes, that's a big one, is making sure you have that proponent, that person, who can help lead the change in the organization. Because unless that's coming from the top-down, it's very difficult to drive that change in the culture. Connie:           Yes, definitely, and one thing I forgot to mention is share your success stories with as many groups as you can. Because the more you can broadcast how analytics will help improving business outcomes, you will build momentum and excitement around analytics. Adam:            Now, one thing I wanted to circle back to, you were mentioning legacy systems, and how it's hard to connect things and there's a lot of manual data. Maybe we can talk a little bit about how companies should strategically invest that money. Especially if you're a medium to small-sized business, it's not always easy to implement new systems, you might not have the capital. But you want to strategically invest that money so that you can have the right systems in place, to foster that data culture we've been talking about.Connie:           Yes, there are three areas I would offer for consideration. The first one is to build the capabilities within the organization. So that goes back to training employees on the skills that they need.To ask good questions to identify what data they need. Train them on how to analyze results, with the skills they will take ownership on the data capture and analysis. The second area to invest in is technology. The key is to find the right technologies. Some companies will spend thousands of dollars and potentially millions to invest in state-of-the-art ERP. But, yet, they might be using 10% or even 5% of the functionalities. So any way you look at it, they're not going to get the ROI on that. And there are lots of smaller applications out there, cloud solutions, for instance, today, that are very affordable. And for smaller businesses, they might want to focus on those and hone in on what are the biggest functions that you need from that application, and that's the best way to go. And you want to make sure, also, the tool is easy to use. Those big ERPs, generally, are clunky to use. So the smaller and simpler the tool is, you get better user adoption. Because when users use a tool haphazardly, you end up with incorrect and inaccurate data. The third area to invest in, it's got to be time and effort. It takes time to do the work, capture data, compile it, analyze, discuss, take action, make improvements, et cetera. So it's not something that you want the staff to do it for one month, put it aside for a few months, and come back to it. It doesn't work that way. To build that culture, you got to be consistent and put in the time, regularly, to build that habit. So when you invest your time and effort in these three areas, technical capabilities, technology, and time and effort to build a habit. You will build confidence for your teams, hopefully, across the organization, to make a shift to a data-driven culture. Adam:            Yes, no, that's great advice. But when you think about all the data that we have in organizations, it can be very difficult. And all that data is not necessarily quality data. The old adage "Garbage in, garbage out". How can organizations ensure that they possess a complete set of accurate data? And some of that time that you were talking about putting in, does that include cleaning up the data? Connie:           That's an excellent question, Adam. Quality data is a challenge for many companies, and it's nice to have accurate and complete data. But, in reality, most companies still have a lot of work to do. Of course, you can clean and correct your historical data, in your systems, but it is usually a painful exercise and often the game might not worth the efforts. So if you, indeed, need to make decisions based on historical data, I would suggest a couple of things. The first one is to understand where your data deficiencies are and incorporate assumptions in your analysis. Develop the worst-case and the best-case scenario, so you have the bookends. And when you apply your business savviness to your numbers, you make better decisions. For example, when Covid hit, 2020, we know that in the second half of the year, the shipping costs went sky high. So if you include the cost for those six to eight months, in 2020, when you want to deduce the average margin cost for your portfolio, you know the numbers will be out. But you know the reasons, and you can explain the anomalies. The second option is you can exclude those data points from your analysis. Now, the second part to make decisions from historical data, as you mentioned. If you have the time and manpower to do the data cleanup, you can do it. But I would suggest to be very selective on how much you want to do because you don't want to get into a spiral. Now, that's historical data.  Going forward, though, you have more control on the data quality, and there are two parts to that, to build good data. The first part is to capture meaningful data. The second part is have good data input. Let's look at the first part first. Capture meaningful data; so that is training your staff to have the skills to ask quick questions, so they know what data they need to go after. And, essentially, when they're good at that, they will become filters for capturing meaningful data. Now, the second part is good data capture. What is most critical here is to have the tool that is easy to use. Think about a worker working in the site, on a construction site. They have limited amount of time to enter data, and you got to make it easy for them. Use drop-down lists, for instance, minimize the guesswork. And if they're working out in the rain, you're asking them to enter 20 data fields on a screen, that's not going to happen. So you want to ask for the minimum amount of input, and that goes back to ask for what is relevant. Forget about what's not relevant because it doesn't make sense for them to do all that work. And you asked about the building trust in data, too, and I would like to address that part. On how do you get people build trust in the data and therefore the output that you generate from it?  One best approach I suggest is to look at the results and do reasonableness tests. For example, you can use a subset of the data and use that to verify the margins for select skills of your portfolio, and share the analytics with as many people as possible. Because the more pair of eyes you get on the results, you get better feedback, and you can tweak your analysis. The idea is not to go for perfection because you don't want analysis paralysis. Adam:            Definitely, you don't want that, and I think it's so easy when there's so much data to get lost in the details. And you can't talk about big data, you can't talk about massive sets of data, without talking about generative AI tools like ChatGPT. The ones that everybody's talking about. But in a lot of these tools, the ERP systems that you're mentioning, a lot of them are incorporating those types of generative AI to help you with the analysis of the data. So we've talked about how important it is to have good data in your system. Now, how can these tools help be a tool? Obviously, they're not the end all, be all, because with all AI you need HI, Human Intelligence, to make sure that they work together. But how can these tools help with reliable insights, especially, with the power of AI that's out there? Connie:           ChatGPT has really created a big rave out there with AI. And with ChatGPT and AI-driven insights, data quality is very important. And back in March, earlier this year, OpenAI did share that the fourth generation of GPT, on average, makes up stuff 20% of the time. And you heard about ChatGPT hallucination, generating outputs based on wrong information. And I'd also like to mention a couple of articles that Microsoft had to take down what they claimed were unsupervised AI-generated articles on the travel website. One of the articles was recommendations for travelers visiting Ottawa, in Canada, our capital city, and they suggested that you got to visit the food bank with an empty stomach. And the second article was a recommendation for visitors going to Montreal, in Canada, and one of the suggestions was you got to try mouth-watering dishes such as McDonald's hamburger. So you got to be careful about how you're looking at the AI-generated, outputs. Do your fact checking and judgment as well, see if it makes sense. Because if you just use what is presented, you could make poor decisions and potentially exposing the company to legal and non-compliance risks. Now, you talk about using AI to generate content and incorporating part of that into in-house tools. Using AI based on internal data set is probably somewhat, quote-unquote, could be more reliable when you have quality data. But the same thing is you need to make sure that what you fit in is reasonable. Also, check the performance of your AI model, and there are metrics out there that you can look at now, looking at the accuracy, precision, and F1 score, et cetera. So you need to be careful of how you are using that model. And if you look at a lot of articles out there, now, they're talking about companies are diving into AI but, yet, not all of them are deploying them in a big scale, at this point. Because of the concerns about the accuracy and how data could be misused, and also generating output that could be misguiding decisions. Adam:            Yes, that's a really good point. Things to always keep in mind when using any generative AI. Now, what if there's a listener listening to this conversation, right now, and they're like, "Connie, I've done all the points that you've made. All the points you've made I've implemented in my organization." Now, how can they assess the effectiveness of this new data-driven culture that they've created in their organization? Connie:           There are three things they could look for to assess the effectiveness of their data-driven culture. The first thing is enthusiasm around analytics. Are people asking good questions to verify observations, that's one thing. When people just share data or share information, they ask for justification and verification for those. Are they asking good questions to pinpoint problems? Are they getting clarity on work ideas? When your boss tells you that, "Oh, we got to be efficient." And right away, if you hear someone ask, "What do you mean by efficiency? Can you be more specific about it?" Because once you hone in on those specifics, it will help you to identify, "Ah, you're talking about speed of the process or errors that we're making that will help you to identify data to capture, and therefore, there are KPIs that you need to hone in for doing your analysis. The second thing you'll look for is transparency. When you have a solid data-driven culture, people are very receptive to what the data present. They're very objective and impartial when it comes to interpreting the results, and they're ready to share the information. No reservation about it, good and bad. Let's just look at it and be open about discussing what that means and how do we need to respond. The third thing you can look for is that trust in each other. When people are very comfortable in sharing results openly, and they're very forthcoming, focusing on issues rather than personal attacks or pinpointing blames. People when they're not afraid to speak up, you can see that you have a data-driven culture, that people are very forthcoming and, in fact, collaborating well together. Now, you've also asked about the second part of that question, the culture, whether, fostering better decision-making. I would put the onus on the champion. We talked about the champion before. As the champion, he needs to reinforce that discipline is in place to turn data into actions and improvements. He also needs to pay attention to whether folks are committing to measurements, and analysis, and he will need to observe how they make decisions. The champion also needs to monitor if the capabilities are in place. You got to give people the tools to do the work, track the impact. Be able to have the time allocated to discuss the results, take action, and then continue to monitor it, and I would make a comment on, this. Random improvements are often short-lived, but evidence-based improvements are sustainable because they indeed tackle a problem that is important to the business. Adam:            That's really important, and as you have this data-driven culture, and you'll be able to see things more quickly. How important is it to swiftly act on these new insights that you're gaining more quickly, as you're seeing the data and seeing the big picture, but in a better way than you were before? Connie:           It is super important because doing the analytics is just part of the work. Turning that analytics into action and follow-through is very important. And I'd like to share a story on Alan Mulally who is the former CEO of Ford Motor Company. When he joined Ford in 2006 and became the CEO, Ford had lost $17 billion in the previous fiscal year. And over the course of eight years, what he had done was he turned the weekly executive team meeting into a collaboration exercise. Executives will come to the meeting with the numbers, with the issues, table it openly, and ask for advice and insight ideas on what they can do about them. That's a big contrast to his predecessor. What it used to happen is the expectation was, "You don't come into this executive team meeting without a solution to your problem." So what happened then is there's no incentive to share issues and that's really forcing, in a way, guiding people to work in silos. When Alan had his first executive team meeting, after he began to CEO, he was shocked when he looked at the dashboards that folks brought to the meeting. There were hardly any red lights. If you think about the dashboards; the green light, red lights, there were hardly any red lights. And the first question he posed to the team was, "Folks, we know the company is losing money. How can we only have a few red lights on this dashboard?" So you can see that he really turned the company around when he exercised the regiment of come and bring the results, whatever it is, green, red, yellow, bring them all in. You just need to identify what the issues are. If you have some ideas on what you're going to do with them, let's share them, openly, with the team. Others will have ideas, or experience, or people with a skill set that will be able to offer some help. So he really changed that whole culture, driving the data-driven culture home by actively promoting that every week. So big kudo to him, when he retired from Ford in 2014, Ford was a money-making machine. It had a profit of $7 billion when he retired. So that speaks volume to his leadership and how he changed that whole culture around. So it also illustrates that, yes, you do the analytics is one part. But getting the folks together to talk about the results openly, no hidden agenda, "Let's be open and honest about it, what's happening?" And let's solve and tackle the issues together. Adam:            That's so important, and some people call those the fierce conversations. Those conversations that may make you uncomfortable, but they're super important to having open and honest, and making your organization successful. Connie:           Yes, definitely, because you can only do so much doing analytics. And, yes, you can have a center of excellence, building intelligence in this particular group. But if you don't have that arena for people to talk about it openly and share the information, it's not going to help a whole lot.Adam:            Well, this has been a wonderful conversation. Thank you so much for sharing your insights and the importance of having that data-driven culture, Connie. Thank you so much for coming back on the podcast. Connie:           Happy to be here, and thanks for having me.  < Outro > Announcer:    This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders, from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting in finance education, visit IMA's website at www.imanet.org.

Tune in to listen to Adam Larson as he hosts the Count Me In Podcast, featuring a special conversation with Adam Lean, the CEO and Co-Founder of TheCFOProject.com. Lean shares expert insights on transforming the role of the traditional CFO, offering practical advice and real-life success stories. Don't miss this insider's look into the future of the accounting profession!

Tune in to the latest episode Count Me In, where host Adam Larson brings you an engaging conversation with some of finance's leading voices in India. We're thrilled to feature Sunil Deshmukh, IMA’s Chair Elect boasting over three decades of global business management expertise, and the astute Sandhya Sriram, Group CFO of Narayana Health, renowned as one of India's Top 100 Women in Finance. In this episode, Sunil shares his distinctive perspective on sustainable finance’s competitive edges, such as improved global market access and cost of capital benefits. Sandhya, on the other hand, offers a deep dive into the real-world applications of ESG strategies within large organizations, while addressing the intricate issues surrounding ESG disclosure transparency.With this powerhouse duo, you're privy to a rich discussion that spans everything from the transformative ESG initiatives at Narayana Health to the visionary roadmap laid out for sustainable finance under India's G20 presidency.Don’t just listen, be part of this enlightening session. Whether you're a CFO grappling with ESG strategy, or simply intrigued by the evolution of sustainable business practices, this is an unmissable dialogue loaded with experience and insight. Plug in and join us for a compelling narrative where finance and responsibility converge.

Welcome to the Count Me In Podcast! Join your host Adam Larson and today's guest, financial expert Tony Klimas, as they discuss the future of finance and insights for 2025 and beyond. Tony has 25 years of consulting experience that he brings to his roles as president for Horvath USA. Get ready for a deep dive into the evolving financial landscape and how the role of the CFO is changing. Stay tuned as Tony shares valuable perspectives on AI, machine learning, process automation, and ethical considerations in the finance function. Don't miss out on this engaging conversation with a true industry expert!

Welcome to Count Me In! Join your host Adam Larson as he dives into insightful conversations with industry experts. In this episode, Adam is joined by Andrew Jamison, CEO & Co-Founder of Extend, a Point72-backed fintech platform that enables virtual card and spend management capabilities for small businesses. They discuss how small to medium-sized businesses can leverage fintech solutions to reshape their financial landscape. Get ready to gain valuable insights and practical advice from Andrew as he shares his expertise in the field. Don't miss out on this engaging discussion that is sure to empower SMBs in embracing the latest technologies. Tune in for this informative episode!Full Episode Transcript:< Intro > Adam:            Welcome back to another episode of Count Me In. I'm your host, Adam Larson, and today we have a fantastic guest joining us, Andrew Jamison, CEO and co-founder of Extend. A fintech platform that enables virtual card and spend management capabilities for small businesses.  We'll be exploring how small to medium-sized businesses can leverage these innovative solutions, to reshape the financial landscape. Andrew will share valuable insights on the importance of embracing fintech technologies and how they can drive efficiency and growth. From the power of data and open APIs to the role of big partners in mitigating risks.  Andrew will guide us through the key factors and success stories of implementing fintech solutions. Plus, we'll explore the future of AI, and machine learning, and finance, and the skills finance professionals should cultivate for continued relevance. So, let's get started. < Music > Andrew, I'm so glad to have you on the Count Me In podcast, today. We're excited to have you here, and we're going to be talking about fintech, and different solutions, especially, in the realm of small to medium-sized businesses. To jump right in, how do you think that the fintech solutions are reshaping the financial landscape, especially for small and medium-sized businesses? And why is it crucial for them to embrace these technologies? Andrew:         Look, I think we're continuing down a really exciting journey, actually. Where the prevalence of data, and the ability and accessibility of technology means that we're finding more and more verticalized solutions. Which helps on two fronts; one, on the one hand, it means if I'm very specific in the industry that I serve. I start to have a solution that actually talks to me, specifically, in my industry.  And I think the ability for people to access that technology means that you now have more and more independent developers, who are exploring how these open APIs can be used, leveraged, and really brought together to create solutions that are increasingly targeted, at the different functions that we work in. So I think that crossroad we're there, and it's only going to explode from here, in my mind. Adam:            It's definitely going to explode. You see the different technology is getting more and more accessible. But sometimes it's harder when you're in a small to medium-sized business. Sometimes you're an accounting department of one, or two, or three people, and it's harder to implement some different types of technology. What advice would you give to somebody trying to look into it, saying, "Hey, I want to jump into this, but I may not have the budget that bigger organizations have?" Andrew:         Look, what I look at small companies, they want to do more with what they have. And they're trying to abstract away the complexity because, you're right, I look at our team, we're a team of 80-odd employees. And the reality is I have one VP of finance, and he's only just now gone and hired his right-hand person. And the reality is that they're jacks of all trade. They're AP, they're AR, they're essentially all your cash flow management, and they do all your recording, all in one.  So if I sit down, specifically, with him, it's really all about seeing how they can leverage existing software for longer. How do you abstract away some of the challenges with some of the software that you might have, as you start growing as a business? How do you leverage other solutions, which are just embedded with those solutions, so that you don't have to go through a massive transformation?  Well, I'll give you a great example, and that's Graham Stanton's Avise. His whole thesis is all about lots of businesses use QuickBooks, and then quickly you grow up, if you're a successful company. But do you really want to make the next step to the next enterprise solution? Which, actually, costs a disproportionate amount of money more, relative to the benefits that you're going to get from them in the early years. So there's always that, healthy tension, but we're starting to see more and more people focus on the abstraction piece. Keep the ledger the way it is, and then just start adding solutions over the top that help me run my business more efficiently. Adam:            I like that. Adapt it to what works for you, as opposed to maybe doing a whole ERP system that may be too much money or too much of a spend for you. Andrew:         Yes, and, again, finance team of one, I came out of the exact polar opposite world. The first 10 years of my career were in deploying SAP. So right at the enterprise resource planning side of the equation, and just a completely different beast, in terms of the different types of people that you had to go and engage with. And also just the number of departments that you got to engage with. Therefore, the resources that were required, just to keep the engine running for that platform were just completely different. Adam:            Now, we can't talk about moving to different technologies without talking about things like fraud, and just the risk there. And especially if you're a smaller department, or a partner of one, like in your case, there are two people. How do you protect against hackers or different things, different emerging threats, especially, in the fraud space, especially, if you're a medium-sized business? Andrew:         Look, I think you have to rely on the bigger partners. You can work, certainly, to continue to enhance your solutions. But you do have to lean on some of the bigger partners. We lean on, certainly, on the AWS infrastructure to help us there because they have so much more money to plow into this.  Now, obviously, they're a bigger target than we are. But they also have way more resources to help plug those gaps. So in our mind, it's also two things; one is it's not really about if, it's when, it's going to happen. And, then, it's really about how do you mitigate it in terms of relying on these partners.  Now, clearly, cybersecurity, whether it's through an encryption or authentication. I think lot of work continues to be done there. And I think we all experience it, in the consumer world, which is more and more of it has to be done through biometrics, it has to be done with MFA, and sometimes it has to be done through both.  And, I think, we need to continue and go down that path, and that's not going to change either. I think that's where more and more resources are going to get plowed in, especially, if you're in the fintech space. We're dealing with money. We're dealing with the lifeblood of companies. And, as a result of it, we have to be doubly sure to make sure that those threats are mitigated as best we can. Adam:            So you've already talked about having threats and relying on third parties. Are there any other key features that these types of businesses should look for, when they're looking into different solutions? Andrew:         The one thing I've learned is one size doesn't fit all. You have to look at what is the primary tool that people are using. Is it mobile? In which case you have access to certain tools. Is it web? In which case you have access to different tools. And you have to marry them all together as well, and to sort of create one overall solution.  So, for me, it's also having the ability to look at things through those different lenses. And, again, when I look at our business, where we are helping to promote existing credit cards in circulation through partners like American Express, or Regions Bank, or Pacific West Bank. Where we're promoting people who can use their existing credit card.  Now, there is an underlying piece that comes with that. Which is I, specifically, want to leverage the infrastructure of these big bank players, without having to repeat it and replicate it for ourselves. Why? Because they have way more data points than we could ever hope to have. And really that's why leveraging that infrastructure in the back end, creates that additional layer of security. Adam:            It really does create that extra layer of security because you're relying on people who may have the bigger infrastructure, to build in those things that you might be unable to build yourself as not a bigger company. Andrew:         I think there are two parts, everyone can go out and build anything. And what I've learned through my time, with big companies, like the 12 years I was in American Express. You can always start a project; the real thing is it really the core of your business. And if it isn't, you have to ask yourself that difficult question of, "Yes, I can build the best mousetrap for today, and maybe tomorrow. But what about the day after that, and the month after that, and the year after that? Because we know how budgets operate in these companies. It's, essentially, every year you go back with a cup in hand, and you try and secure a budget. And, then, essentially, you go into some sort of a recession or some sort of a cutback, and there's budget gets constrained and suddenly you're no longer investing in that piece of business. And it's amazing how quickly you fall off being best in class if you don't invest in solutions, today.  I think that's the other thing to be really wary of is you have to be mindful of that, to double down on areas that you are truly going to commit to, as a business, because otherwise you're going to go through these cycles. And I think that's where maybe large companies today are placing more emphasis on their partnerships with fintechs.  They're embracing fintech because I think they've realized that trying to compete, in that world, sometimes, isn't good for them either. It distracts them from their core. They don't move as quick as they would want to move, and they certainly can't experiment as quick as they would want to because they have all these different layers of approvals. And then the bigger challenge still is it's not just about the layers of approvals. It's the fact you start spreading across lines of business, and that, maybe, don't have experience in that particular segment.  And, so, you make mistakes in thinking that consumers work maybe the same way as large corporate. And you're not actually, again, identifying the right solution for that particular client segment that you're trying to serve. Adam:            Yes, so we know that implementing these applications and partnering with different companies, ultimately, saves you money. It might not save it right up front, there's a little bit of investment involved, but over time, it'll definitely save you money. Are there any real-world success stories or examples that you can share, of where people have implemented this and really seen a huge change? Andrew:         Look, I mean, that's part of the journey that we're on. Which is we deal with a lot of finance teams and the word we keep hearing day after day, month after month, is this wonderful word called reconciliation, and that's what eats time. It's, essentially, you have approved something somewhere down the line, either verbally or through a technology system, and then you have to marry it up with a payment. And, so, that aspect of things, and we talked to a lot of clients who used to have all these charges appear on one central bill product. And, so, at the end of the month, they'd have this huge list of transactions and they'd be like, "Right, now, I got to allocate them." And the reality is this is happening over weekends. And, so, it's sort of like, "Great, you've given me my life back." Which is if you're automating hundreds and hundreds of these transactions back to these digital records, that happen upstream. Then, truly, not only are you creating efficiencies and allowing people to do more with the time that they have. I think you're also taking away some pretty mundane tasks, and that, to me, is the key.  And there's, obviously, a lot being discussed around AI and all this. And I'm like, "AI is not new: It's been around for decades; it's just got a new name." And, for me, it's more about the application of that information in such a way that we'll see the lowest-hanging fruit, and the earliest benefits will really come in that automation of back office functions.Things, frankly, that don't need or warrant a person to be doing and can be done just as well, and, sometimes, better by a machine.  And I think that's where I get excited is like, imagine if you can get away from really 30, 40, 50% of tasks, that are super mundane and not strategic, and let's focus on some more interesting problems. So that, essentially, we can really move the needle forward. Because there's a lot of green pasture out there, of things that need to be moved forward for businesses.  And, so, it'd be much more fun to spend our time tackling those challenges, than some of these mundane tasks, that these different teams and functions have to perform either on a daily, weekly, or monthly basis. Adam:            Yes, it seems the rise of machine learning, and AI, I mean, like you said, it's been around for years. It's definitely coming to everybody's worldview with the Chat GPT, and generative AI kind of things. With those things coming to a head and really changing how the finance team looks.  What are skills and things that people can do, maybe, the people who are running those tasks? Let's say you're listening to this podcast, and you're one of those people doing those mundane tasks you were talking about. What can they start doing right now to make sure that they're relevant as they go forward, in the future? Andrew:         Look, I think it's all about having an inquisitive mind, and it's all about what's the next challenge you're trying to solve for. And I think you always try and pick out these needles in a haystack, and the machines will do that. Adam:            Yes. Andrew:         And, "Do I see these same transactions happening twice? I don't have to write a report; I can just ask the machine and it, essentially, starts returning these things." And I think those are things that become really meaningful to businesses, is help me pick those needles out of the haystack. That in the past, I would have had to go and write some report to go and pull back. And guess what? Writing a report takes resources. All of a sudden, it's like, "Well, I can't do that either because those resources are allocated something else."  So if you can, essentially, and that's the beauty of having a conversational AI, is, yes, of course, it has to be programmed. The reality is it continues to learn and evolve, and you can fine-tune it, and then you can adapt it to different scenarios. And, so, you can start asking different questions of the machine and it, again, continues to improve, over time.  And I think we've already seen with chatbots, that servicing is increasingly coming through machines, except we all know dead-end pretty quickly, even today, and that's always more frustrating. At which point you pick up the phone and rage and say, "I want to speak to a human being." And, then, depending on who the company is, it's either easier or harder to get a hold of an individual.  But I think that's where it's going to help, is help me service myself because that's another big thing. Even as a department, when you hit these different challenges, it's all about I want to be able to service this myself. And I think that's really the key, and I think that's where fintechs have also helped a lot, which is help me unearth things which are just not in an obvious place.  And, so, we spend a lot of time as, essentially, we have digital credit cards flowing through the ecosystem. The beauty really of these digital credit cards is you actually append them with metadata, along the journey, which is what department someone in. Then you start figuring out what business unit they're in or you start to figure out what's the expense category. And all these things can be automated, when you start pulling together different things.  And I think then it's going to become even more interesting, as we go down the line. Because you're really going to be able to pull together these different data points to get insights, around what's really happening with the health of the business.  I think that's why I also like this marrying up of old and new. Because that also means you don't have to go and rebuild everything. There's access to these data points and huge piece of information, that you get through the existing banks. And now it's about, "Great, I can use their information, and I can enhance that information, and I can then send it back to the corporate who can update their ledgers directly." And a lot of this manipulation was made available to the Fortune 500, Fortune 1000. And there were big projects that they had to go and pay for, mind you. But the reality is now more of this is becoming accessible to small businesses, and I think that level of automation and insights is really going to help them move forward. Adam:            It really is. Because, you mean, you go back in the day where you had to categorize, have a category for each transaction, and make sure you do those things. If people were using the QuickBooks, back in the day, but having, like you said, the embedded metadata. Being able to have that automatically, you can automatically start tracking those things. And it allows you to move faster and analyze better. As leaders, in the organizations, they have to rethink how they're leading their team. Because you're no longer looking at the little mundane tasks, but you're able to do those more strategic decisions, like you were saying. Andrew:         And I also the idea of more real-time data flowing in. And if I'm a finance person, that's what I want is real-time transactional information and data. So I know what's coming down the pike or, essentially, how I'm trying to manage the existing cost base. I was in a company where we grew really fast, but we were on a route to going to doing an IPO. And I remember, very distinctly, the CFO saying, "The hardest thing to control is all these incidental expenses that keep rolling through." So, again, how do you manage?How do you pull the different levers, as a finance person? To make sure that people have the right tools in their hands, so they can go and spend when they need to spend. But, actually, it's been approved ahead of time. And not only is it approved ahead of time, for a very specific thing, but it's actually got all the metadata that says once it happens, the chapters close, no need to revisit. It's essentially flowed all the way through, and that, to me, is what finance folks are really looking for. It's give me the chance to opine on something ahead of time, and let's work together to make sure that it has all the information needed. So that it then flowed through the system, and we just look at it once. Adam:            Yes, and if you just watch TV, you see commercials for these things just to consumers. Like, "Hey, sign for this app and it'll tell you all your bills, and you can clean up your stuff." If we're making it available for consumers, that means small to medium-sized businesses are going to have better access to these types of softwares. Andrew:         Yes, I look at the coming together of finance and procurement, and things like Glean are out there, also, really helping, as solutions really sort of focus in on what you're buying is it competitive? And all of those different things come into play. And I think that becomes also great tools for all about providing insights to these small finance departments, and really help them operate at a much higher level than they were operating beforehand. Adam:            Yes, so as we look toward the future, where do you think we're going? Where are the new technologies going to hit and how are things going to improve, as we look five to 10 years in the future? Andrew:         So, look, I take a lot of learnings from my days, certainly, at SAP. And that's to say that when you really look at it, and the amount of effort I feel they put into HANA, and to all these different things, it's all about data. And, so, their primary concern, I'm guessing here, was we just need to be the source of data, the ledger, the source of truth, and we'll facilitate other things. And what started off as EDI is now APIs, and then we're going to layer on top of that some of these more conversational components of it.  But what I'm learning through that and what I'm taking away from that is, there isn't a huge appetite for companies to move from one ledger to the next. And that's partly because the ledger is the ledger, is the ledger. Now, obviously, if it can be done in real time, it helps.  But the reality is it's really what you do with that data there and then. And I like the idea that a lot of these legacy players and financial service, obviously, is one of those players, it has a lot of legacy infrastructure in there. Is really going to get updated really fast, and integrated and embedded faster into the software solutions that finance people are using, or procurement people are using. Because, essentially, they're going to focus on that last mile and we're not really there, yet.  I think when it comes to data, a lot of work has happened with companies pulling data out of ERPs. But, obviously, the really hard bit is pushing data into ERPs. Why? Because if I'm a finance person, I want to see those things before you go and update my ledgers.  So I think there's still a lot of work to be done on that particular front, in terms of great, pull data. And, again, commercially, people have pulled data. Why? Because it helps with underwriting. But then we've learned that underwriting is really, actually, quite tough, as well. You look at some of the decisions that some of the emerging credit cards in the commercial space made around no longer supporting small businesses.  Why? Because in an economic downturn, the reality is it's small business that suffers, and that's where losses have suffered. And, so, some people made the decision to walk away from there. Now, the interesting thing is that's where banks have played for years, and that's where they've learned, and they have other sources of information, and data to go and support right businesses. The regular mom-and-pop businesses that are out there. Because not everything is about fintech, it's the real world, too. America runs on small business, and Milburn, and Dunkin' Donuts, apparently, but that's a different thing.  But that's kind of, in my mind, where things are going to get really much more interesting, is really helping to deliver on the promise, to facilitate the world of the office of the CFO in these smaller companies. Where, essentially, there's more control, but the integration is better in terms of flowing data and information into the systems. And the systems that have been put over the top of them, to make sure that they don't lose that metadata, and they can report that metadata or use it for conversational AI, et cetera. Adam:            Definitely. Well, Andrew, I really appreciate you coming on the podcast. This has been really insightful conversation, and thanks so much for sharing your insights with our audience, today. Andrew:         No, absolutely, Adam. Thank you for having me on the podcast, I enjoyed the conversation. < Outro > Announcer:    This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders, from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting in finance education, visit IMA's website at www.imainet.org.

Welcome to Count Me In! In this episode, our host Adam Larson welcomes back Alissa Vickery, Chief Accounting Officer, SVP Accounting and Control at FLEETCOR, who shares her journey as an interterm CFO at Fleet Corps. Discover how Alissa balanced multiple finance responsibilities, handled the weight of the CFO role, and developed her leadership strategies. Get ready for an engaging discussion that will inspire and inform. 

Welcome to Count Me In, with your host, Adam Larson. In this episode, Adam is joined by Tim Hedley, the Executive in Residence at Fordham University and Shari Littan, Director, Corporate Reporting Research & Thought Leadership at IMA.  Join this thought-provoking discussion as they delve into the importance of internal controls, the evolving landscape of sustainability reporting, and the challenges and benefits organizations face in adopting sustainable business practices.Discover how the COSO framework, the gold standard for reliable reporting, has been adapted to include non-financial reporting objectives, aligning with the rise of sustainability and ESG reporting. Explore critical trends in the world of ESG reporting, from increasing regulations to stakeholder engagement and supply chain transparency.Learn from Tim and Shari as they share their insights on the challenges organizations face in implementing sustainable practices and balancing short-term profits with long-term sustainability goals. Understand the significance of internal controls in providing a basis for external assurance and building stakeholder trust in reported information.Join Tim and Shari for a live event Nov 30 - Dec 1 in NYC. Register todayFull Episode Transcript:< Intro > Adam:            Welcome to another episode of Count Me In. In today's episode, joining us are two guest experts. Tim Hedley, who is Executive-in-Residence at Fordham University, and Shari Littan, Director, Corporate Reporting, Research and Thought Leadership at IMA. Our discussion revolves around the importance of internal controls and sustainability reporting. And how they enhance trust, accountability, and reliability of the reported information.  Tim and Shari share insights from the COSO framework. Which was developed to help improve confidence in all types of data and information. The landscape of sustainability reporting is constantly evolving, with shifting regulatory requirements and increased stakeholder expectations. We explore crucial trends; such as the focus on materiality and risk assessments, stakeholder engagement, supply chain transparency, and evolving reporting metrics. Let's get started, with this enlightening conversation.  < Music > Adam:            Shari, Tim, thank you so much for coming on the podcast. We're really excited to be talking about COSO, internal control, and everything in that whole ESG world. But just for our listeners, who may be unfamiliar, you could've, probably, have heard the term COSO, or ICSR, and those things before, but maybe you're not familiar with those terms. Maybe, Shari, you could take a little bit of time and define, maybe, a high-level overview of what COSO is, the significant, internal control framework, and the purpose of the new documents. Shari:             I'd be happy to, thanks, Adam, it's great to be here. So COSO stands for Committee of Sponsoring Organizations and it came about in the late 1980s. It is a collaboration of five accountancy and auditing organizations. There's the American Accounting Association, which is an academic organization, primarily. AICPA, everyone is familiar. IMA, where we sit, and we primarily focus on the accountants and finance professionals in business, the in-house folks are ours. Institute of Internal Auditors, and FEI, Financial Executives International. So those five organizations make up COSO. COSO came about in the late 1980s, amid what was then the savings and loans crisis, and there was concern that the profession needed to do better. That we were starting to see major accounting failures, disclosure, litigation, regulation, questions. Are we doing the right things in the profession?" So the five accountancy organizations got together, and they said, "How are we going to resolve this? How are we going to promote trust and accountability in what we do, as a profession?" The focus became on this concept of internal controls, which we'll get to.  So in '92, after that, the COSO, as an organization, produced its first internal control framework. And then we can move forward to 1990s, late 1990s, 2000, the Enron, WorldCom's era, which led to Sarbanes-Oxley. And Sarbanes-Oxley, rather than looking at the substance of what a company needs to disclose, again, looked at the idea of governance process, auditing, and said, "In order to produce financial reports to the markets, you need to focus on your systems and your controls. You need management to speak to it, in your reporting system. You need auditors to address controls." We had the PCAOP. So we have this Sarbanes-Oxley, which created this idea of internal controls over financial reporting. And, although, Sarbanes Oxley didn't specifically say, "You must use the COSO framework." It was considered the best thing around, and it's become the gold standard in how to produce reliable financial or corporate reporting in more general. Now, in 2013, the framework was refreshed, we got a new internal control framework. And what it did, in the 2013 refresh, is it added the idea of non-financial reporting objectives. That was around the same time, about 10 years ago, when we started to see all kinds of sustainability integrated, ESG, reporting frameworks. And, so, though not express, what the framework did, in its refresh, was say "Yes, this is completely applicable to these types of activities and reporting." And, so, that leads us to where we are, today. Where, earlier, in 2023 we issued the internal control over sustainability reporting publication. And what the authors did, in that publication, was we looked at the existing internal control framework and said, "Okay, now we're seeing an acceleration of ESG or sustainability reporting and activities, performance and activities.  And that means we need good information, and that means we need quality information and transparency. Let's look at the COSO Internal Control Framework, and see how we can interpret it and apply it to these new forms of reporting. Adam:            Shari, I think that's a great overview. And, as you mentioned, there's the ever evolving nature of this new type of non-financial reporting, ESG reporting. There are shifts in regulatory compliance. We were just speaking before we started recording how this could change, or that could change, or this regulatory body can make a statement, at this moment, at this time, how this is constantly changing.  And, Tim, maybe, I'll ask you, how do you see this landscape changing? And what should organizations be, particularly, aware of, especially, with the ever evolving nature and things constantly moving? Tim:               Well, Adam, thank you, and thank you for having me here. The sustainability reporting landscape has rapidly changed, particularly, recently, to meet stakeholder expectation, and government regulations. And, Adam, your question could be an entire podcast, or a big section of this podcast if we had that kind of time, but I do see some critical trends, just some of the ones, from my perspective.  I mean, many people are out there, I'm sure Shari's got all kinds of ideas of what those trends might be. But there are some that just come to mind, for me. I think the biggest one that I think about a lot, and certainly what I experience in the classroom, and then talking to people who are in the field of sustainability reporting, some of the people I work with in different contexts, I think the first one is increasing regulation.Regulatory bodies, worldwide, are increasing their focus on sustainability reporting. And, personally, I think we should expect ever more stringent reporting requirements. And an interesting case in point, I think, is under the new California Climate Corporate Data Accountability Act. U.S. companies with annual revenues of $1 billion or more, in the State of California, for report both their direct and indirect greenhouse gas emissions, in the next few years. I think that's a huge change and really indicative of the kinds of things that we can expect going forward.  I think next is, probably, increased investor pressure, I have no doubt about that. Institutional investors are placing more emphasis on sustainability factors, while making investment decisions. And, actually, I just saw an actual run of this, recently, last month, actually, they are employing very structured analysis using very detailed sustainability factors. So I think there's going to be more and more demand for increased disclosures, and that's not going to go away anytime soon. I think we're going to see more focus on meaningful materiality and risk assessments. People are paying a lot of attention to ensuring there are robust materiality and risk assessments, that identify and prioritize issues that are most relevant to businesses and to stakeholders. Stakeholder engagement will increasingly be more important.  Engaging with stakeholders now is critical, but, I think, it's only going to become ever more so, as we move through this process. There appears to be a much keener focus on greenwashing, and I, personally, think this is a huge problem for us. I think it's actually gotten to the point, where it seems that the perception of greenwashing is causing some pushback in this space and, actually, almost threatening the integrity of the effort. I think we're going to have to think a lot more about honest transparency, in this process. Do we want people to actually buy into this and trust the process, and the kinds of things, this year, I was just talking about? I think I'm leaning directly toward that notion of more honest transparency. I think there's going to be a greater focus on supply chain transparency. Particularly around human rights, DEI, environmental impact, all these kinds of things. I think we've only seen the tip of the iceberg in this space. I think reporting, metrics will continue to change. The metrics that investors and stakeholders focus on are changing really fast. We are seeing a great deal of movement in the EU, in particular. For example, the Corporate Sustainability Reporting Directive, which went into effect this past January, it's extending the requirement to report on sustainability management from a select number of companies in the EU to nearly all companies in the EU. Except these little micro companies, I guess. So, again, a lot of movement here, a lot of stuff is changing. My bottom line, I mean, I could keep listing these things. But my bottom line is that sustainable reporting is dynamic, it's always changing, and, as professionals, we must stay informed about changes in regulations, investor perceptions, and societal expectations.Shari:             Can I add just one thing to what Tim said, and that is we tend to focus, or we have tended to focus, when we think about corporate reporting on public companies. Because naturally there are securities regulations both in the U.S. and in various jurisdictions around the world. But one thing that we are seeing in the world of sustainability, or ESG information, is that it is going to affect small and medium-sized companies. Maybe not direct corporate disclosure, but to their commercial customers into supply chain. We're actually seeing where a large public company, for example, has made net-zero commitments or other kind of commitments. And they talk about that in their public materials, and it goes into their ratings, et cetera. Well, they turn around and turn to their suppliers and say, "If you want to sell to us, we want your carbon footprint data. We want your modern slavery DE&I data. And we're seeing, in a positive way, in certain places, where the large commercial buyer is working along with the smaller suppliers. The component, the agricultural companies, to say, "Let's find ways that we can work together."  And it has become a competitive advantage for non-public companies to be able to say, "Not only can I deliver your components, but I can deliver your components along with quality information." We're seeing supplier audits in this area starting to come up, or industry collaborations where they're setting standards. So it's not only public companies to think about. Tim:               It's not just the public companies, because I've had conversations with a lot of organizations, they're asking for my help in responding to their customers. And if they're part of the supply chain, they will, certainly, have to disclose Scope 1, 2, & 3 emissions. Shari:             Exactly. Tim:               And one of the problems they have is they have no clue, what in the world that company is talking about. They don't even know what the starting point is. We're talking about internal controls over sustainability reporting, this is wonderful stuff. But if you're a small organization, that's never even heard of this space, that has no idea how to report. A lot more education is going to be necessary for that upstream and downstream indirect emissions providers. I've had people call me up and say, "They're asking, now, my employees, how far do they drive to work? What kind of a car do they drive?" And all of these kinds of things, and it's very confusing for, in particular Scope 1, Scope 3, emissions information providers. Like "How in the world do I capture this stuff?" And, Shari, you're absolutely right, large organizations can't get where they want to get to with their reporting, unless the entire value chain comes on board. Adam:            That makes a lot of sense, and there's going to be so much pressure from the consumers and regulatory bodies. And I can imagine it's overwhelming for any organization. Maybe somebody is listening to this and saying, "I know I need to do something." And, so, maybe, we can define what some of the benefits are to organizations and some advantages, if they can apply the sustainability business, the internal control integrated framework, to their organization.Shari:             Well, I will say that, first of all, one of the great benefits of looking to the COSO framework, or ICSR as we're referring to it in shorthand, is that we already know how to do a lot of this. We have the ability to leverage what we already know about building good governance systems, and controls, and processes, and oversight into our company systems, and looking at the information flow. We can train, think about training our board, and our members, but we already have a lot of the tools, and the know-how to address the concerns. It's not as esoteric or new, it really can be rooted in what we already do. Second, another great benefit is that, although, we think about COSO Internal Control with respect to external financial reporting. When you actually get into the framework, it is enterprise wide, it is holistic.  If you want good reporting, well, then, you need good information, and that means you are tracking your activities, and what your company is doing. And if the company is taking steps to actually become more sustainable in their performance. Of how they source energy, and how they human resources, and take care of waste, and all of those things. So it runs throughout an entire organization.  And the thing that I find is that when you think about it holistically, you start with the concept of purpose. So if you look at the publication, you look at the framework, you look at principle one, a commitment to ethical behavior, of being a good corporate citizen. And what is your purpose?  Why does your company or organization exist in the world?  What are you aiming to achieve? Why should all of your investors, and stakeholders, and employees, stay with you?  What are they going to get out of this; with respect to performance, and activities, and returns? So it leverages a reexamination, it leads to a reexamination, I should say. Why does our organization exist?  What are we doing, and are we doing these things efficiently? Are we doing them effectively? When I first started writing this publication, when I was tapped to become part of the authorship team. I said, "Internal controls and sustainability, well, that feels a little apples and oranges, to me." But, in fact, it's really about focusing on goals. It's focusing on purpose, and objectives, and how the company achieves those, and the information that it uses to decide how it's going to use these resources. Tim:               And I think I'll add something because I thought that was a great explanation by Shari. The bottom line is, from my perspective, I think the framework we're dancing or advocating and what has been put together with respect to internal control and sustainable reporting, it's comprehensive. It has widespread acceptance, it focuses correctly, in my belief, on risk management. It's very adaptable. When I read the publication that Shari co-authored, it's absolutely adaptable. We had with the internal control, the Internal Control Integrated Framework, absolutely adaptable, and it works perfectly here. And, really, most importantly, it has absolute global applicability Shari:             Yes, when I hear Tim say that global applicability is that there are so many regulators, and policymakers, and standard setters, and all sorts of organizations that are saying, "Here's what you need to report." It's a lot on the what to report, but this gives a framework of method of how. Tim:               Yes, and it does a good job with that. Adam:            I think you've given a great explanation about all the advantages and how it benefits. But I can't imagine that it's an easy process, and there are got to be challenges that people can encounter along the way. Maybe we can discuss a few of those challenges, to help people feel at ease. Tim:               When I was thinking through this, you can talk about some of the challenges. But, I think, it might make sense to talk about what some of the benefits are before we got to the challenges, perhaps, because I found that significant. I think the first, at least, from my perspective, the first benefit is enhanced reputation. A commitment to a purpose-driven business can enhance an organization's reputation, there's very little doubt about that. And there's a fair amount to thought leadership research, and surveys, and what have you, that support what I just said. If you look at GM, you look at Procter & Gamble, those are great examples of companies, in their sustainability report that have detailed their corporate purpose in very explicit ways, and easy to read, and make a lot of sense. And really I tell you in this space, there's been a paradigm shift. From just being a shareholder-first mentality, to say, "Hey, well, you know what, there are a lot of stakeholders." I think through this process you can gain a competitive advantage. Gain business practices, it can help recruit, and retain talent, just for one example. They can foster innovation. They can lead to development of new products and services. Think about electric vehicles, think about solar, think about power storage. These are all kinds of industries that we were not even really thinking much about not that many years ago, at least, not in a serious way. They can provide access to new markets and opportunities. And one thing I found very important, certainly, as my work over the last 25 years in the governance space and what have you, I can go a long way to increasing stakeholder trust and engagements. It can also have significant cost savings. Case in point is 3M's, 3Ps-Pollution Prevention Pays.And if you look at a sustainability report you'll see that, "Hey, this has saved billions of dollars since its inception." And they do a good job now of highlighting it, even though this was before we were really talking about sustainability, and ESG, and these things, and they were on top of some of the stuff. Risk mitigation, sustainable practice if well executed, it can mitigate environmental, social, and governance risk, ESG risks. It can help avoid costly reputational damage, integrity breakdowns, governmental scrutiny, fines and penalties, all kinds of benefits. Help provide access to capital, companies that demonstrate strong sustainable performance. Can often find it easier to access capital from socially responsible investors and from institutions that prioritize sustainable investments. Can lead to long-term value creation by producing a more stable and sustainable business model, less risk, and what I would say are higher valuations. And I think that's the greatest selling point for, actually, doing this stuff in a very serious way. It really is all about long-term value creation. And, of course, finally, I would say it can differentiate your brand. If you embrace sustainability and corporate purpose, you can distinguish yourself from competitors and build a brand that resonates with your consumers. Remember, it's all about the consumers in the end. There are some challenges which you had mentioned earlier, when we talked about it earlier. I think one of the biggest ones, the initial investment costs for sustainable products and efforts can be very expensive. Perhaps beyond the grasp of some, but well worth the investment for many. Understanding shifting consumer preferences is not always straightforward. Encouraging consumers to choose sustainable options over conventional ones can be slow and a challenging journey. Sometimes these sustainable options are perceived, sometimes, as being more expensive. Regulatory compliance can be demanding. It may require continuous adjustments to business operations. Clients with changing environmental regulations and standards can require continuous adjustments to your business operations. Which may pose significant operational challenges. Another big one is balancing short-term and long-term objectives it's often tricky. Organizations may, counter a lot of pressure to prioritize immediate profits over long-term sustainability, creating both internal and external pressure. And some may, I'm afraid, think you have to sacrifice one for the other. And, Adam, I don't buy into that, I don't believe that. But a lot of people do believe that, it's an either/or kind of thing. There are significant resource limitations above and beyond the budget I mentioned earlier. Things like renewable energy sources, sometimes, are hard to find. Sourcing sustainable materials can be really difficult, not to mention human resources and talent acquisition can be very difficult. Complex global operations are challenging. Multinationals might face headwinds in implementing uniform sustainability standards across diverse regulatory environments, cultural norms, socio-economic situations. Further global supply chains are incredibly complex. Much more so than domestic organizations, and requires a great deal of collaboration to make this work. And, then, finally, in this area, I would say the greenwashing concerns, we kind of touched upon it earlier. But with the focus on sustainability, there is a risk of an organization engaging in greenwashing. Where they make misleading claims about the environmental benefits of their products or operations. Such practices can lead to reputational damage and loss of trust among stakeholders.  I know I've talked twice about greenwashing, but it is a huge problem. And it really is undermining a lot of the good efforts taking place in this area. So to help ensure long-term viability and success, I think it's important to develop a comprehensive strategy that aligns sustainability goals with the overall corporate purpose. Shari:             Listening to Tim, I'm reminded of a story that was shared with me a few years ago, now. It was my colleague in an agricultural company. And, of course, the questions came to them about carbon footprint, "Are you measuring greenhouse gases, et cetera?"  And, so, they started to do that measurement, the inventory, instituting their processes. And in doing that what they discovered is a huge waste of water because they were looking at how they produce and operate in a more holistic, as you say, totality.  And, so, in trying to quantify and measure their carbon footprint they ended up changing their entire system of water and reduced it by a lot. So they ended up having gains, by extension, to new streams of information, that they hadn't been looking at before. Tim:               It really is an exercise in navel-gazing, looking deep inside yourself, to actually do this stuff. And it's not an easy process, but that's a great example of where there are all kinds of benefits, well, and it's unintended benefits, from actually going through this process, and a lot of discovery takes place. You learn a lot about yourself. Adam:            It really sounds like you can learn a lot. And I think you've kind of illustrated, my last question was going to be around, how does this framework play a crucial role in ensuring effective governance, and rules, and internal control systems. Especially, concerning sustainable business practices, and what you just displayed there, Shari, for us, was a great example of that. And if there are any other examples you guys can share, I think that would be really helpful, and encouraging as people are thinking about this and looking at it. Because it's inevitable that it will be affecting every organization. Shari:             Yes, here's another example that I thought of, when you're getting more into the risk and the overall reasons, to think about sustainable business. But I do remember if you drive along highways now, how often do you see charging stations. In fact, I saw, not far from where I live, a former gas station had completely changed into an electric vehicle station. And I thought somebody else in that supply chain, if you create fuel pumps, you might want to think about changing that business model, and that's what the information can bring forward. Tim:               Yes, earlier I had mentioned that notion of a robust, risk, and materiality assessment. And just adding on to what Shari was saying, I had a conversation not long ago with a tire manufacturer. So they were doing deep dives and taking it very seriously. But they started understanding things that were hugely important and material, they'd never thought about before. For example, when you drive down the road, your tread wears out of your tire. You don't think about, "Where does that rubber go?" Maybe it goes in the atmosphere, it goes on the street, it goes on the side of the road. And suddenly, wow, they're materiality mapping and that process is hugely dynamic. The risk assessment is dynamic, and I think people are looking for that dynamic approach to these kinds of things. You can be an energy company just delivering electricity for a municipality, and suddenly you start getting into solar panels. And, suddenly, "Wow, we got new risk, where are they sourced? Where is this stuff coming from? What does that supply chain look like?" So a lot of interesting things that actually pop out of going through this process. And a lot of it leads to much better decisions and also uncovering important things and cost savings, it's all there. Adam:            Tim, Shari, do you have any final thoughts for our audience? Shari:             Well, as we wrap up, I want to just bring it back to why the internal control, and the COSO framework, and that publication, in thinking about all these new types of activities and new types of information, that has risk associated with it. And there are business risks, but there are also risks in the information. For example, we talk about supply chain, so in order to account for Scope 1, not Scope 1 because that's your data. But Scope 2 and Scope 3, you, by definition, need to get information that doesn't come from your system that you're responsible for, it has to come from a third party. So there's risk in that information. So we need to think about other controls. We need to think about affiliates, or other investees, or companies that we outsource to, that we used to consider immaterial for financial reporting purposes, but now we need their information. Green Bonds, is another, where we're affirming to our lender that we are in compliance with certain ESG metrics and then they lower our interest rate, that's informational risk.  We also have the risk of estimation and expectations, and how we measure prospective assumptions and leads to that kind of reporting. I think that's really huge because so much of sustainability reporting, including some of the mandatory disclosure requirements coming out of Europe, double materiality, impact accounting, it means estimating the future. That's what sustainability is all about. Do we have the resources made available to us in the future? Can we count on that?  Are stakeholders willing to make those available? So, anyway, it goes to the question of estimating the future, which makes many, in traditional accounting, uncomfortable. They don't like to disclose and report on the future and our assumptions. But that's a necessary part of creating the measurement techniques in order to effectuate all these new demands, for reporting all these new KPIs. What I'm saying is that by following what we already know how to do, By leveraging the frameworks that we already have, it can highlight and help direct us address the innovative areas, the information, the use of digital technology, perhaps, to bring this about in a reliable way, and avoid the greenwashing that Tim has highlighted for us. Tim:               Yes, I think the things that you talked about resonate with a lot of things we talked about earlier. Those things are all about long-term value creation. Shari:             Agreed, absolutely. Tim:               You got to be thinking about the future. And, also, one of the things that I see from the work you've done here and the internal controls of sustainability reporting. I think it's going to go a long way to helping with the notion of external assurance of this information. Because now we'll have internal controls in place that make some sense, that can be tested in and of themselves, it gives a lot more confidence in what's being reported. Because stakeholders are going to take some of this stuff with a grain of salt. Unless someone actually opines it, "Hey, wow, you know what they're telling you it seems accurate enough. It's doing what it's supposed to do."  I think that's going to be a huge underpinning for the document we've been discussing here. Because I think it's going to go a long way to enabling that. And unless you have that third-party attestation, the trust may not be there until we get to that point. I don't know, that's just my prediction. Adam:            Well, I appreciate you guys sharing your final thoughts and sharing all your insights with our audience, today. And thanks so much, again, for coming on the podcast. Shari:             Thanks so much, Adam. Tim, it's been a pleasure.  < Outro > Announcer:    This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders, from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting in finance education, visit IMA's website at www.imainet.org.

Welcome to the Count Me In podcast with your host Adam Larson and special guest Dan DeGolier! In this episode, Adam and Dan, founder and CEO of Ascent CFO Solutions, dive into the fascinating world of AI and its application in the finance and accounting sectors. Discover how AI is enhancing efficiency and reducing errors, while also exploring the potential challenges and ethical considerations it presents. Join us as we explore the evolving landscape of AI in fractional leadership. Tune in now for an engaging discussion you won't want to miss!Full Episode Transcript: Adam:            Welcome back for another exciting episode of Count Me In. I'm your host, Adam Larson, and today we have a special guest joining us, Dan DeGolier. The founder and CEO of Ascent CFO Solutions. We start off by exploring current use cases of AI in the industry. Such as coding transactions and streamlining forecasting processes.  But as Dan points out, we're only scratching the surface of what AI can do. The potential for growth and efficiency is immense. But it's important to proceed with caution and be aware of the biases and ethical considerations that come along with it.  Throughout this episode we highlight the evolving role of finance and accounting professionals, in the age of AI, and how they can adapt to leverage its benefits. From bookkeepers, to CFOs, to fractional CFOs, AI has the power to enhance efficiency and transform the way we approach financial management. So grab your headphones, and join us as we uncover the exciting world of AI in accounting. Let's dive in. < Music > Well, Dan, we're so excited to have you on the podcast today, as we're going to talk about AI and fractional leadership. And just to get started, as we think about AI, how is it currently being applied to finance and accounting sectors? Obviously, it does things like enhance efficiency and reduce errors, but how is it being applied in those areas?  Dan:                Yes, thanks for having me on, Adam. It's a pleasure to meet you, pleasure to be here. I think we're just getting started, for one thing. AI, even though it's been around for a while, ChatGPT, GPT 4, and all those things, are relatively new to the mainstream. And, so, a lot of this stuff we're just starting to figure out right now.  Definitely, in the accounting side, we're starting to see some use cases for coding transactions and things like that. I think there are a lot of opportunities in our world, in the finance realm. When it comes to forecasting, to be able to streamline multiple scenarios and make iterations to financial models and forecasts.  I think that's an area that we're starting to see develop. And, then, things like pricing strategy and looking at different ways to price and run different scenarios around that. Using large language models, and data, and being able to bring in data and run multiple scenarios and see what things look like there. I think those are all some areas that we're starting to see.  But, honestly, because it's so early, what is really going to be the biggest use cases, two years from now, is probably something we haven't thought of. Or somebody's thought of but hasn't really been implemented, yet. Adam:            Yes, that's a great point, that we're so early in the generative AI phase that some organizations are adapting quickly, other ones aren't. And software companies are trying to integrate it into there but it's still in the early phases. So our traditional role- Dan:                And it's still prone to errors as well. Adam:            Exactly. Dan:                Yes, we've all read the articles about the lawyer who tried to use it for briefs and got in huge trouble, and the hallucinations are still rampant. So I think proceed with caution, but recognize that it has enormous potential and don't be left behind.  I was going to say, I've heard that it's been compared to if you look at Web 1.0, the emergence of the Internet, and commercial use, that this could be a 10x-type of opportunity. From a growth potential, from an efficiency potential, et cetera, it's just fascinating to me, just how massive this could be, and how life-changing this is. Adam:            Well, and also the bias that's implicit in there, in the AI. Because there are so many biases among how people think, wording, that's out there in the Internet and how it's learning. There's going to be that bias that you have to get over as well. Because it's going to be embedded in there because of how it is societally. Dan:                Correct, yes, I agree with that. I think one other ethical consideration that needs to be taken into account, when you're implementing AI, is things around copyright infringement, and intellectual property, and protection there. I think the chatbots aren't necessarily aware of what's IP and protected and what's not.  And, so, it's important that we take into that, that there's a human overseeing that, and making sure that there's nothing being taken out of context or being utilized improperly. And along the same lines, research is another area. Tax research and other types of accounting research is a place where there is a lot of use cases for AI.  But, again, this is where you need to be very careful around trusting that research and validating that it is accurate. So we don't end up in a situation, where something that's not valid is being utilized. Adam:            It's going to be very difficult to understand what has been verified and what hasn't, and as you're doing research and as you're looking at things online. I imagine new tools are going to have to be developed to verify, "Yes, this is valid." Or "No, it's not." And how do you trust those as you go forward? Dan:                Yes, that's really important, and there are going to be mistakes made. As we start to adopt this, we're going to see mistakes being made. And, as humans, we need to learn from our mistakes and learn from others' mistakes, that's how we evolve. Adam:            Mh-hmm. Do you think that the traditional roles in finance and accounting are going to change because of these? I mean, obviously, they are. But how can we adapt as we go forward? Dan:                Yes, I think, first thing I would suggest is pay attention to what's going on, see what's evolving, see where things are taking it. I think it's going to definitely change the accounting side, the day-to-day transactional stuff. There's a YouTuber out there, Hector Garcia, who has done some demos of how you can plug in a ChatGPT tool into QuickBooks Online, and how that can help ease the coding of transactions and things like that. So it's definitely going to change that bookkeeper and junior accountant role significantly, I think it'll change all aspects. The CFO's desk, it's going to still require somebody with experience, and knowledge, and understanding, to validate what's coming out of it. Just like in any other industry, there's a lot of need to confirm, and double-check, and be heavily involved at that strategic level. But I think it'll make us more efficient. Adam:            Yes, I definitely agree with that. And as you're talking about things like analysis and looking at it from that higher level. I mean, obviously, the AI has a better computing power, but we still need that human element. And how does that traditional human analysis going to affect, as we look at the output from the AI? Dan:                Yes, that it's still going to be critical. Machines are going to do a lot of the analysis and it'll find pattern. It's better at pattern recognition than us, especially. with large data sets. But when it comes back to that human element of truly understanding, and the uniqueness of certain things, it's going to require a human element.  In preparation for this call, I was thinking a lot about fraud detection, and you got large data sets out there. I think, again, back to pattern recognition, AI can be really good at identifying things that stand out and look unusual. I mean, if you think about, maybe, purchase orders or sales orders that look unusual.  Maybe have overrides from managers and they can look for patterns there, where particular users, within an accounting system or ERP system, might see that something that a particular manager might tend to override things more often. Or looking at addresses, and zip codes, and understanding if there might be some inappropriate payments made that match up to addresses, vendors matchup to employee addresses or things like that. So that could be bogus, that could be fraudulent.  I think those things are going to be a huge area for auditors, both, internal and external auditors starting to use those data sets. Where that AI tool can go in and start digging around and finding some unusual patterns.  Adam:            Yes, and thinking about implementing AI, within your organization, if you're really considering this, you've done all the research. What are some challenges or ethical considerations that should be addressed, when implementing it? Dan:                The first thing that comes to mind is security. Right now, I've been reading some things that we're trying to be able to bring it inside your intranet, bring in those tools inside your internet. But you don't want to have breaches of data, things that go out, where the chatbot is getting a hold of your corporate data and then utilizing that in the greater universe. And, so, that's going to be really critical, is that we solve for security concerns where things stay within the four walls very clearly. That's the first thing that comes to mind.  And I think the other one is touched on earlier, which is just trusting it too much and seeing that something that comes out of it is just trustworthy, as opposed to really validating it. Whether that's research around case law, when it comes to tax law, or whether it has to do with... Just what comes out of a financial model, and what's practical from a pipeline perspective and things like that, when you're forecasting your financials. Adam:            Yes, so as we look to the future, when it comes to AI. What are some of the breakthroughs that you think will happen within the finance and accounting industry, as we look to the future with AI? Dan:                Automation, in general, and that can take multiple forms. We touched on the accounting coding of transactions and things like that, I think that's a big part of it. There can be a lot more automation around all of the accounting cycles. Whether it be payroll, invoicing, accounts payable, there can be a tremendous amount of automation on that side.  Variance analysis when it comes to your soft close of the books, your initial review of a month-end close. I think there can definitely be an analysis and digging in a transaction, and looking for those variances to prior periods variances, to budget variances, to forecast, and pulling those out. So I think there can be some automation around that. And, then, again, on the financial modeling piece, the forecast piece, there will be automation there as well. Adam:            So one area of expertise that you have a lot of expertise in, is the fractional leadership, the fractional executive, and especially the fractional CFO. And as we're talking about AI and the changing of how that CFO looks. How do you see the ability to have this AI as a fractional CFO? How does that really enhance your ability to help the organizations, that you're within that fractional capacity? Dan:                Yes, well at our firm, we're technology first, and we've always been focused on automation where we can. So I think for us, it's going to be those same types of approaches. Where we find ways to be more efficient, to be more cost-effective, to really implement these tools. Identify the best use cases for these tools, kind of trust but verify. Make sure that you still got that adult supervision, with that AI tool. But really leaning into it and making it a tool that speeds up data for the C-suite.  The faster you can close your books, the faster you can update your model, the faster you can make adjustments. When you see something change with your pipeline, I think, more agile executive team can act. Adam:            So when you're coming in as a fractional executive, a lot of times the best place for that model is an organization in transition. And, so, that's what I've been reading when I've had other conversations. It seems like it's organizations that are in transition, and when you're in that transition, it seems like you would be looking at all your systems. But how do you come in and say, "Hey, I want to have this technology first and utilize these tools." But they have never used those before. How do you bridge that gap? Dan:                Yes, it's an incremental process. I mean, when we look at working with a company, they are often going through a transition. Maybe, they're looking to raise an additional round of capital. They've recently raised another round of capital. They've got a new board reporting requirements. They need better discipline when it comes to forecasting their cash flow.  So if they're a little behind the 8-ball, when it comes to technology, it's going to be incremental steps. You first have to get a really solid ERP, or accounting system in place that is trustworthy and fully GAAP. Whether they're audited or not, you want them to be fully on accrual GAAP basis.  Once you have that, then, you start to put in place those data visualization tools. That's something we've been leaning into really heavily the last year or two, is creating really robust dashboards and data visualization, that not only show your historical financials, but your forecast, and your HR, and your payroll, and your sales pipeline. And, so, those technologies first need to have really reliable actuals, before you can lean heavily into some of the other newer technologies, and more robust technologies. Adam:            That makes me think of how important it is to have good data. Because you don't want to have garbage in, then, it'll just be garbage out. So you have to really make sure your data is in a good spot. Dan:                You don't even want to start to forecast or implement those better tools until your historicals are accurate, for sure. And it's not just plain GAAP financials, it's also what your KPIs look like. What are the real drivers of your business? And that's one of the things we look at when we come into a new client, is really take the time to look at the true drivers of the business.  They may not be obvious at first, every company is a little bit different. What's driving their growth, and their revenue, and their cash flow. So we really lean into that. And, so, we'll often start with what we call an assessment phase. We'll spend 20 to 40 hours just really digging in deep, to understand every component of the business. Adam:            Do you think that all businesses would benefit from some a fractional executive coming in and relooking at things? A lot of times people bring in consultants to do that. But it's just like they look at everything, give you a PowerPoint, and head out the door. But that fractional seems to be like that person who partners with you for a period of time. Dan:                Yes, definitely, our model is based on long-term but part-time. So we're, generally, looking at companies in the SMB market. So, generally, we work with companies between 2 million and 100 million in revenue.  And, so, as that company scales, some companies are too quick to hire a full-time CFO. Where they might really just need a full-time controller, a really solid controller, and an accounting team. And, then, a fractional CFO for a couple of days a week, who's extremely well qualified and very experienced, could be a great fit for them. To bring in that true executive-level oversight, with decades of experience, to help them navigate, again, what those critical KPIs are. Where the holes are and the different strategies that are being considered and things like that.  So, yes, companies that are worth 75 or 100 million very likely to have a full-time CFO, a very qualified CFO. But companies under 75 million or depending upon the transaction complexity, and transaction volume, companies that are small and medium-sized businesses can really benefit from having a top-notch CFO on their team. But it may not need to be a 40-hour or 60-hour-a-week job. It can maybe be a 20-hour-a-week type of engagement. Adam:            So you get that full-time experience, that experienced person there. But you may not, necessarily, be able to afford the salary that would require to have that person on full-time. Dan:                Yes, and there may not be enough, truly strategic, CFO-level work for that person, that you need to have someone on a full-time basis. That's what our whole model is based on. As you grow and evolve, you get the resources you need on a fractional basis.  Our team is CFOs, and VPs of Finance, and controllers, accounting managers, financial analysts, senior accountants. So we've got a full stack of people with different levels of experience, who can come in and support a company during its growth phases, and you pay for what you need. As opposed to having a real heavy fixed cost on your G&A budget, G&A financials. Adam:            Yes, that seems like a really good benefit, especially, for the small to medium-sized businesses. Is it beneficial for a startup? If a startup is just getting going; as an entrepreneur, is it good to bring in fractional folks, or do you think full-time would be more beneficial? Dan:                Yes, fractional makes a lot of sense for an early-stage company. I look at as a step function. You start out maybe you just need a part-time accountant to make sure things are being coded properly. Once you have revenue and you're ready to raise around the capital, then, you probably want a strategic fractional CFO or VP of finance, who can help you with that capital fundraise, help you with a really robust financial model, and understanding what your KPIs and drivers are.  And, then, over time, you start to fill in some of those roles on a full-time basis, as you get a growth cycle. So it's not uncommon, maybe, you start with a fractional senior accountant and a little bit of oversight, from a fractional controller. And then that evolves into one or two full-time accountants and, then, a fractional CFO, and, then, eventually, you get a full-time controller, and it just builds as you go up the ladder in revenue, and fundraising. Adam:            So this does not have to do with fractional CFO. But I want to throw this question out there and you feel free to answer it or not. But do you think that the evolution of AI will help bridge the gap between US GAAP and IFRS, to make it a more international accounting standard? Dan:                I think it definitely has potential to. I think that there's logic in the way that things like RevRec and other things are being handled, between IFRS and US GAAP. So, I think, there's definitely some good potential there. Adam:            Yes, I don't know. Because I just feel like as we become a more global world and how we would do business and everything. It would make more sense to have a globally recognized accounting standard, so that everybody's doing the same, has the same standards that they live up to. Obviously different countries have different beliefs and stuff like that, but it would make sense for us to think globally. Dan:                Yes, I like that. I hadn't given that a lot of thought before, but that does make a lot of sense to me. Adam:            Mh-hmm, well, Dan, I want to thank you so much for coming on the podcast. It's been great talking with you. Thanks so much for sharing your knowledge and expertise with our audience. Dan:                My pleasure Adam. Really it was fun to meet you and fun to discuss these emerging technologies with you. < Outro > Announcer:    This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders, from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting in finance education, visit IMA's website at www.imainet.org.  

Join host Adam Larson and special guest Paul McManus, as they discuss the importance of personal branding in today's accounting and finance industry, and how it can help you stand out from the crowd. Paul is a podcast host, the author of the book “The Short Book Formula” and the co-founder and CEO of More Clients More Fun.  Discover the power of writing and publishing a book as a means to enhance your personal brand and become a thought leader in your field. Explore practical tips and insights on how to effectively communicate your expertise, simplify complex concepts, and engage with both experts and non-experts alike. Don't miss this episode that will empower you to create expert status and level up your career as a financial professional.Full Episode Transcript:Adam:            Welcome back to Count Me In. In today's episode, we have a special guest joining us, Paul McManus. To discuss the power of personal branding for accounting and finance professionals. Paul is a podcast host, the author of the book The Short Formula, and the co-founder and CEO of More Clients More Fun.  We'll explore why personal branding is crucial in today's competitive landscape, and how it can elevate your status as an expert in your field. Paul, an accomplished author, with multiple bestsellers on Amazon, will share his insights on how creating a book can enhance your personal brand and establish you as a thought leader. We'll also touch upon the challenges professionals face when approaching the idea of writing a book and how to overcome them. Let's get started. Paul, I want to thank you so much for coming on the podcast, today. We're really excited to talk about personal branding and becoming better versions of ourselves through that type of work. And, maybe, we can start off by talking about why things like personal branding are, especially, important for today's accounting and finance professionals. Paul:               Definitely. Thank you for having me, I appreciate being here. I think personal branding is one of the things, whether you're a small business owner, or whether you work at a firm, as a professional.  At the end of the day, when you're growing your business, or whether you're looking for promotions and to make a bigger impact in your world. Nothing, well, not nothing, but personal branding can be one of those things that help you differentiate yourself from everybody else.  One of the ways that I, primarily, focus on to help professionals with their personal branding is to help them write and publish a book. Which I know is something, again, I talk to a lot of financial professionals and I ask them if they've considered it, and many have. But it just seems like one of those daunting tasks that it's on someone's bucket list, but they never quite get to.  So, as part of the personal branding question that you asked, I'd love to deep dive, as appropriate, into how a book can really help accountants, and other finance professionals really take their personal brand to the next level. Adam:            Yes, definitely, when you think about writing a book, some people think, "Oh, no, I have to write this thousand-page book, and it's going to take six years, ten years of my life. But if anybody has looked at the show notes for this event, if they've looked at what you do. They've seen you written multiple books and they've been on Amazon bestseller. So how does creating that book really enhance your personal brand and elevate your status? Paul:               Yes, writing a book is one of those things that has a long history that people respect. I think there's really two things that help professionals stand out. One is writing a book, another is public speaking. There is the old quip from Jerry Seinfeld on the public speaking side that if you're at a funeral; would you rather be giving the eulogy or be in the casket? And the joke was, well, most people would rather be in the casket because they're terrified of public speaking.  But I think just the act of getting up and speaking in front of people, is just one of those things that most people are afraid of, and so they respect. It's the same thing for writing a book. It's something that just in our culture, there's a tremendous respect for someone who's put in the work, done the work, and who has written and published a book.  Because it's one of those things that really differentiate yourself from everybody else in the field. It's one of those things that people think about, talk about, and more often than not, never do. And there's a variety of benefits to doing it, personal branding be one of them, which we can go deeper on. And, then, there's also a variety of reasons why people never take that action. So, on the plus side, we want to be clear about why do it.  There's a great Simon Sinek talk about begin with why, and when your why is clear, then, you get that much more clear on the motivation and the how. And, so, let's talk about the why, from multiple ways to think about it.  So, again, if you are one of those professionals that does any work in the capacity, as a business owner. So let's say maybe you're a fractional CFO and you're looking to attract clients. Let's say that you work with clients themselves and, maybe, what you do is more difficult to understand. The ability to articulate your core knowledge through a book, way that is interesting and simplifies it to an outside audience. Especially an outside audience of non-experts, is a very powerful way simply to communicate.  I find that writing a book, it's a personal growth endeavor. Oftentimes you start with a blank page and you think, "Okay, what do I know about this topic?" And after a few minutes, you're like, "Oh, that's it." And, so, you have to say, "Wait a minute, I know more than this." And it really challenges you to think about what you know, and why is that important, and who's interested in that. How can you communicate that in a way that's effective? How can you use stories?  Oftentimes, especially, with accountants and other finance professionals, what I find is that there's a lot of jargon. There's a lot of technical terms. There's a lot of things that they understand implicitly through experience and study, but for a non-expert, they get lost. And, so, it's how do you communicate ideas in such a way that is relatable to whomever you're speaking to?  And, so, throughout that process, and we talked about personal branding a little bit, but it really helps you create leadership skills, communication skills, and those things all come together. And, so, whether you're looking to sell more, get a promotion, or simply be more effective at your job. The act of writing and publishing a book is an amazing vehicle to help supercharge those efforts. Adam:            Mm, yes, it's interesting because when you think about it, if you don't know how to explain what you're doing. If you don't know how to articulate it in a very good way. How can you be that storyteller, be that business partner? Whether you're in a firm and you're trying to go alongside the C-suite and make sure you're telling the story right, of what's happening financially.  But, also, if you're trying to build your own business, you got to be that. And there's that word that comes up, thought leader, and I think that word is thrown around a little too much. But, maybe, you can explain what does it mean to be a thought leader and how does that boost your brand, as you're building up this idea of writing a book? Paul:               Yes, I like that question. So before I get into thought leader, I want to talk about one of the opposites, almost. And it's an idea that you, probably, heard of and is known as Impostor Syndrome. And there are so many people that I talk to, come to me in one of two ways when we start talking about writing a book. On the one side, it's either "I have so much knowledge that I want to share with the world." And then, of course, they run into the challenge of "Where do I start?" On the other side, it's, "Who am I to talk about these ideas? What I do is very average and ordinary. Would people be interested in what I know?" And that's a form of Impostor Syndrome. And, so, as a starting point, in either case, what I love to be able to help people do.  On the one side, if they have a lot of knowledge and ideas that they want to share, is how do you simplify and focus that to a core message. That you have a core audience for and it resonates with them, and they're motivated to learn more about, ultimately, how you can help solve a problem, in most cases. Help them create that transformation from where they are to where they want to be, and do so in a compelling way that engages them and interests them. Then on the other side, if someone is stuck and thinking, "What do I have to share?" What I love doing with them, is really showing them it's like almost falling in love again, with all the amazing knowledge that you've learned. I mean, all of us, we've put years into our craft, into our profession. We've learned really cool things and, over time, because it becomes so routine and we don't actively think about it, let's say we get bored of it. Or it's just so routine that we forget how amazing it was the first time that we, actually, learned how to do something.  The first time I learned how to do something, I'm like, "This is the best thing ever." And, then, a week later, or a month later, it's like "I do that all the time." So I wanted to establish that first. Because, now, when you think about a thought leader- what is a thought leader? And there's a progression of what's considered a thought leader.  But, I think, first and foremost, it's someone who's perceived to be an expert on a subject. I think a lot of people go to university, get degrees, have some initials after their name, but I don't think they're perceived as thought leaders. I think that's considered pretty standard, pretty average.  But someone that's willing to go publicly and put their ideas out in public in the form of a book, or speaking and talking about a book. And when people listen to them or read their work, they see that they have a point of view, a cohesive set of ideas, and they can explain that in such a way that's informative or persuasive. That becomes the basis, in my mind, at least, of becoming a thought leader.  Now, the more exposure you get, the more media you do, the more you write, the more people are aware of you. I think that, then, grows your influence and, by definition, your thought leadership, and that's just really a factor of awareness of what you do. And, so, the more people you talk to, the more people know your work, the bigger your, quote-unquote, "Thought leadership" becomes.  I think at the end of the day, though, and what I do, I attract a lot of my clients through LinkedIn, and these are people that I don't know who they are. I've reached out to them in some form, or I've created awareness in some form because I work with financial professionals.  And, so, they are attracted by marketing in one way or the other. They read my book, they listen to a podcast, and then, at some point, they show up on my calendar, and it's that awareness through ideas, thought leadership, it could be described as, that can take someone who's a complete stranger, but attract them to you in a way that you want them to. And there's a lot of different applications there to do that.  I don't want to overemphasize what thought leadership is and make it this grandiose thing, that only a certain few select people do. I think any of us can be a thought leader, and it just takes the willingness and desire to package some of our knowledge, and be willing to put it out there in the public sphere. Adam:            Yes, I mean, the way you explained it, really makes a lot of sense because, I think, it's been a term that's been thrown around a little too much. But it's helpful to make it more applicable, saying, "Hey, anybody can be a thought leader because you have knowledge, you have experience, and it's just about sharing that knowledge."  So how does one get over that Imposter Syndrome that you talked about? Because I feel like the first step would be to, "Hey, how do I overcome my Impostor Syndrome?" Because you may realize, listening to this podcast, "Hey, I do have a lot of things I can share, but I don't know if I'm able. I don't know if people want to listen to me." Right there, the definition of that Imposter Syndrome. So how does one start overcoming that to move to the next step? Paul:               Yes, there's a quote that I learned from one of my mentors, maybe, 10 years or so, ago, his name is Michael Port, and he talked about learning in action. And what that means, to me, because I've really built up my current business from the ground up, over the past nine years. And when I started I didn't know a lot, and it was just I have to go out there and put up my shingle. And, then, as an entrepreneur, you have to figure stuff out. And it's just willing to take action, being willing to be uncomfortable.  I think the two components that are important there is that, one, you have a desire. You have an end result that you want to achieve. I mean, if you don't have motivation, then, chances are you're not going to follow through on it. So you want to have that why clearly established. Why is this important to you?  Why are you doing this?  And once you're clear on that why, then, you have, ultimately, the fuel that's going to propel you forward. I think the second part of that is to not go it alone. I think in any endeavor, in life, having a coach in some capacity. Someone that you have as a sounding board, someone you can bounce ideas off. Someone who's gone before you and can make the path that much easier to trot. I think those things are all extremely helpful in overcoming the Impostor Syndrome. So much of the time, it's just this small voice in our head that says, "You can't do this." Or "What are you doing?" And what you need, what's beneficial is to have someone supportive around you. Whether it's a coach or a group that can challenge you and say, "No, you absolutely have every right to do this." I want to share a story of one of my earlier clients. She's not an accountant or a finance professional, but she was a world-class expert in helping to rescue penguins. And her name, I believe it was, Diane, Dylan or Diane, I think, it's been a few years. But I was interviewing her on a podcast because I knew about her reputation, and she's written books, and she's one of like five people in the world, that can rescue penguins. When there's some global tragedy, the UN or whomever agency calls her. So that, I think, by definition, would be an expert. That would be a thought leader in the space.  But when I interviewed her, on the podcast, it was just amazing, she's like, "Ah, who am I to do this?" I mean, it was just remarkable, considering that she's like one of five people. She's written books, she does this for a living. But it just goes to show you that this is very common. And, so, I think, another aspect of that is just being aware that it's okay.  If you're having small thoughts, that's okay, we all go through it. And it's, ultimately, having that vision, that goal, that why that can help you say, "Okay, I'm willing to grow. I'm willing to stretch my comfort zone because there's a reason for me to do this." And, so, when you have those things in place, you can overcome Imposter Syndrome. Adam:            Definitely. Well, I like the idea of getting a mentor, getting somebody that has walked the road before you because they've... And I want to preface this, too, is you're not going to get everything right the first time. You're going to fail, and you can't be afraid to fail, right? Paul:               100%, myself, as an entrepreneur, one of the chief lessons I've learned is fail fast, fail forward, and we're going to get most things wrong. And the more you're comfortable failing, the faster you can become successful. It's not to say that you want to provide quality work and you want to do all these different things, but just being willing to fail is the fastest way to succeed. As an aside, I've taken Improv classes, and one of the key lessons that I learned there, and it's really a mindset, is that fail and fail big, don't get scared by it but embrace it. And, of course, in the Improv setting it's funny, the more you fail, the funnier it can be. But it really just becomes a mindset. And, so, just in your day to day, there are so many things that we act small on and we're afraid to do. But if you just have this mindset, "Hey, I'm just going to try it. What's the worst that can happen?" And you just say, "It doesn't really matter." Then that is the fastest way forward. Adam:            And it's interesting, when you were saying that. It made me think of a term that I've used a lot in my professional career, sometimes, like, "I'm just faking it till I make it." But, sometimes, I wonder if faking it till you make it is part of that Impostor Syndrome. Where "I'm just faking it till I make it." But you, actually, are doing a really good job and you're not faking it because you do know what you're doing. So I wonder if trying to getting over that mindset of "Faking it till you make it" and saying, "No, I'm just going to fail, fail hard, and keep going forward instead." Paul:               Yes, I hear you because, I think, "Fake it till you make it" almost has like a negative connotation, that you're not really qualified to do something. But, yes, it's how you frame it in your mind, and, I think, it could be similar. But it's, definitely, the way that I mean it's in a positive way, it's that that's the way to success.  But, again, that's where you can fake it till you make it on your own. And, maybe, that's where you don't tell anyone that you're uncomfortable, or you don't quite know what you're doing, or this or that and, maybe, there are some negative connotations there.  But that's where when you just understand that being uncomfortable is part of it, and you can surround yourself by like-minded people, or a mentor, or a coach, and they can help guide you, and set those boundaries, so to speak. Where it's okay to not get it perfect. It's okay to, fail, is a strong word, but imperfection is okay.  I think another analogy might be perfectionism. It's like, "Well, if I can't write a masterpiece, if it's not going on the New York Times bestselling list, then, why even bother? And another analogy or another metaphor is being willing to write something or step out and not be perfect. Because the act of doing something is inherently more valuable than staying small. Adam:            Yes, I like that. I like that it's a kind of reframing that mindset of, "I'm not really faking it, but I'm learning as I grow, and things may not be perfect. But I'm putting myself out there and that helps me grow, as a professional." Paul:               It is, and I think it's authenticity. Again, that's where you just reframe it from the "Fake it till you make it" which can be a little bit of a negative connotation, it's just being authentic. It's like, "Hey, I'm learning something new, I'm trying something new. It's not going to be perfect, bear with me, but this is my goal." And if you tell people that they'll appreciate your authenticity, when it comes to it. At the end of the day, part of Imposter Syndrome is the fear of being judged.  So it's like, "I'm really good at staying in this lane. I'm really good at it, and people respect me, and I get praise, and I get rewarded. And if I come into this other lane that I'm not comfortable with, then, I haven't developed my competency, yet. And, so, suddenly people see that I'm not perfect." And, so, again, it's all this mindset stuff that you need to grapple with. And, again, should you put yourself through the process and it goes back to your why. And we'll talk about personal branding or writing a book; what could it do for your career?  What could it do for your personal brand?  What could it do for your thought leadership?  What could it do for your ability to communicate?  What could it do for your confidence?  I mean, I find that before I do anything now I want to start by writing a book. Because if I launch a service, or a company, or anything, I want to start by writing a book because I know that in doing so, I'm going to get my own thinking very clear. I'm going to be able to communicate my message that much better and, then, my path to success is that much shorter. Adam:            Mh-hmm, I'm sure somebody's been listening to us chat about writing a book, and personal branding, and I'm sure somebody has thought of the term white paper. And when you think of professional writing, people think of white papers. Maybe we can help distinguish the difference between this book that we're talking about writing, and a white paper. Let's help differentiate that in people's minds, as we're talking through this. Paul:               Yes, in my mind, from a strictly writing standpoint, they could have some similarities. I think from a status and impact level, though, there's a huge difference. One's author, what I love about the word, is that it's part of the word authority. And, so, people see someone who's an author and they have a completely different view of them, immediately, in terms of their competency, their expertise, all these different things. Rightly or wrongly, that's the immediate perception that people have.  I think with a white paper you might have the same level of knowledge or skill set, but there isn't any status or additional credibility that is associated with it. There's no personal branding. Largely speaking, you don't go and tell people, "Hey, I wrote a white paper, no."  And it's like, "What?" Whereas when you say you're an author everyone, suddenly, steps back and says, "Wow, that's really cool."  So my recent book, it's called The Short Book Formula. And I think that one of the reasons everyone is afraid to write a book is that if you think about a 40,000-page business book, that could be a daunting task. And, then, conversely, if you actually want people to read your book, people have limited attention spans.  And, so, the idea of reading six, 10, 12, 15-hour book is a bigger task for the reader. And, so, what I've devised is what I call the Short Book Formula, which is based on writing a roughly 12,000-word book. Now, why is that important? 12,000 words and the way we format it, is roughly 100 pages, and 12,000 words can be read or, in audio form, listened to in about 60 to 90 minutes. With 12,000 words you have the ability to, in our case, we help people write and publish a book within six to 12 weeks. And, so, it's not this year-long thing that they have to do, it's a lot more manageable. And, on the flip side, when you give your book or when people read your book, they're that much more likely to, actually, not just get the book and put on their bookshelf. They're that much more likely to actually read, listen to, and consume the message. Which, especially, if you're in the role of selling, is extremely important. Short books have a strong pedigree. I have a list right here that. I talk about, so I'm going to name out a couple of titles that you may have heard of before. ●       The Art of War by Sun Tzu, 96 pages. ●       The Prince by Niccolo Machiavelli, 94 pages.●       This next one, have you heard of The Communist Manifesto? For better or worse? Adam:            I have, yes. Paul:               40 pages. And, so, I share those examples because you can see the impact that short books have had throughout history. What I really love about short books is when someone reads it, if the message resonates, not only do they get through it and actually read the whole message, they're more likely to read it again.  I mean, there's books that I've read multiple times because I really enjoyed it and I can get through it, relatively, quick. And, this also helps to answer the question of the person who has too many ideas, so to speak, knows a lot of things, and is trying to focus in on what should my book be about? My answer would be, well, let's start with one book and get it really focused, in terms of your audience, what the message is, why they should read it, and write a book around that topic. But, then, from that point, you could start another book, 12,000 words. Maybe it's a new audience or it's a different topic. And, so, you have the ability to create, over time, a series of books. I mean, I've found that I've gone from publishing a book once a year. To, now, where I'm starting to hit two books a year just because I see the value of it and just the process of doing it, is that much more quick and effective. Adam:            Mh-hmm, wow, and from somebody who's read your Short Formula Book. It, probably, took me about two hours, just because I'm a slower reader, and I was thinking more about it. But it is a very quick read and it's an easy read. And it's not like you have to write at a collegiate level, but you want to write at a level that people can understand, and get through it quickly, and understand what you're talking about.  And, so, I think that's a huge difference, too, is that don't think that you have to write in this crazy way. Obviously, I mean, something like The Art of War, may not be easy for everybody to understand because of the way he wrote it. But other ones that went far like the communist one you mentioned, that one went far and wide to many different people because of the plain language, as an example of plain language, and how well that can affect people. Paul:               Yes, I mean, that's one of the things that a book well-written or well-read is, probably, the better way to say that, uses accessible language. It uses language that an average person, a non-specialist, can read, absorb, and learn from. And that might be another difference between a white paper and a book. I think, a white paper is more technical, in nature and it's geared more towards a technician.  Whereas a book, fundamentally, you have a specific audience in mind. But you want to expand who that audience is and, actually, get them to read it because it's interesting and engaging, uses stories to make points, but the language should be accessible. I mean, when you're trying to impress people through fancy language, oftentimes, it's actually the opposite. You want to make them understand it better. Adam:            Yes, you want to make them understand it better. I've always heard that "If you could explain what you do to an eight-year-old, you can explain it to anybody." And I think it's having that mindset when you're writing. Paul:               Well, and, then, from there it goes back to the benefits of writing a book is that it helps you to clarify your thoughts, it helps you to communicate your ideas better. And, then, aside from the actual book, it translates into your ability to communicate with people. Whether it's internal, in the company, whether it's external, you're able to express your ideas that much more clearly to a wider audience and be understood. So for someone who is looking for, say, more speaking opportunities. I mean, at a corporation or a company, oftentimes, the higher you go up the ladder, the more it requires your leadership and your communication abilities. And, so, it's just a great way to hone in on those skills, develop those skills, and then be recognized for it. Someone who has a book is much more easily given an opportunity to speak, whether it's at a conference, whether it's at a podcast, for example, whatever it is because it's trust in advance. People trust that you have a message that can help inform and teach people. Adam:            Yes, and it allows you, and it grows your name, as you get out there and get those opportunities. Paul:               It does.  Adam:            Yes, so as we wrap up the conversation, this has been a really great conversation. Thinking about the accounting and finance professional, and the people that you've worked with. Are there any examples you can give or any stories you can tell? That are success stories, that our audience can hear as they imagine how they could take this route? Paul:               Yes, definitely. One person that comes to mind, his name is Michael Poisson, and I met him, I want to say, a year or two ago. And Michael is, I think, he's really the epitome of everything that we've been talking about.  He's a ESG data specialist, and he works for a smaller company who, essentially, sells ESG data to, primarily, service-based companies, as well as to asset managers. And in his journey of it, part of what he was doing from a marketing and sales perspective, was that he was going to conferences, really as an attendee, and listening in, networking, doing all those things. And part of the value that he saw of writing and publishing the book, even though he was an employee for a company, not a business owner or an entrepreneur, was that it would elevate his personal brand. And it would give him more status to generate more speaking opportunities, to create more visibility, and credibility for what he does. So he published his book, I want to say, six months to a year ago. And I've spoken to him since then, and since then he's reported that, at these conferences, he's invited much more often to, actually, be a panelist or a speaker, which massively increases his awareness inside of his community. He's also gone on a number of podcasts, both as a guest. He hosts, now, his own podcast, and he invites thought leaders on.  But, essentially, having the book has allowed him to elevate his game, meaning that he can create a lot more visibility for himself. He can much more effectively network with more influential people in the process. And it allows him to go from this person at a small company, and because of that elevated personal branded awareness, he can more effectively compete with the larger companies out there in the marketplace. What's interesting about his story, and it ties back to what we've been talking about, is that he's a really smart guy. And I knew this from day one, working with him, ton of knowledge, all these things.  But to go back to the Impostor Syndrome, throughout our work together, continuously, he would not refer to himself as the expert. He would refer to, "Oh, these people they're the experts, I'm just gathering data. I'm just presenting the information." And I had to tell him over and over again, "You are the expert. In doing this process and demonstrating what you know and all these things, you are an expert." So it just goes back to that whole personal journey. I think it was also rewarding because, again, we've been talking about, and I could see this during the time that we worked together and afterwards. But it really helped him deep dive in terms of ESG, and its value, and the stories, and why it's important, and he, obviously, knew this stuff beforehand. But just in going through the process, it really deepened his knowledge and his ability to communicate with others. He even had a college professor, who is pretty prominent in his field, come to him and say, "Hey, I want to use your book as part of my course." Which was pretty cool. Adam:            Yes, that's pretty awesome. And I like that you told the story about how even during the process, as he was going through it and learning more, he was still struggling with that Imposter Syndrome, and that's a big thing for a lot of us to overcome. Because you don't realize, "I am an expert." Paul:               Yes, a 100%, and that goes back to why you don't want to go it alone, you want a sounding board. But you also want someone who can give you positive encouragement and challenge some of, perhaps, the limiting thoughts that you might have on your own. Adam:            Definitely, well, Paul, we could probably talk about this for another half hour. But I really appreciate the insight you've given us, you've given our audience, and I really think that they're going to really benefit from this. I encourage everybody to look at the show notes. You'll see links to Paul's website, if you want to check out his books and the stuff he's written, and if you want to get in touch with him, there'll be ways to get in touch with him, as well. And just thank you, again, for coming on. Paul:               All right, thank you, I appreciate it. I enjoyed the conversation. Announcer:    This has been Count Me In, IMA's podcast, providing you with the latest perspectives, of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Join host Adam Larson and expert guest AJ Coleman in Count Me In’s latest episode. Get ready to dive into the world of internal control and fraud prevention.  AJ is an author and serves as Vice President, Fraud Manager at Byline Bank. He explores the importance of strong internal controls in detecting and preventing fraud, while sharing real-life examples of common types of fraud and how they're identified and dealt with. Don't miss out on this engaging and eye-opening conversation.Full Episode Transcript:Adam:            Welcome back to Count Me In. I'm your host, Adam Larson, and today we're diving deep into the world of fraud and internal control. Joining me is the incredible A. J. Coleman. He is an author, and serves as vice president and fraud manager at Byline Bank. Today, we'll be discussing the importance of strong internal controls, in detecting and preventing fraud, and how organizations can navigate through risks and vulnerabilities. A.J. will share some eye-opening examples of common fraud cases and explain how they are identified and dealt with. So if you want to learn more about the crucial role of internal control in combating fraud, you definitely don't want to miss this episode.  Well, A.J., I want to thank you so much for coming on the podcast. Really excited to talk about internal control, and fraud, and just all the different things you have to do in that world. And I know you're an expert in this field, and I thought that, maybe, you could start by giving some examples of how things like strong internal controls can help by detecting fraud. Since I know you see this every day. A.J.:                Well, great to be here and the opportunity to talk fraud is always rewarding. But, yes, internal controls are really the key, is to be able to identify where there are opportunities or gaps, for the fraudsters to expose an organization. And that's really where the first thing you have to look at is where are we exposed, and what risks that are out there. And from there, you then start crafting those internal controls.●       How do you want them set up? ●       What do you want people's roles to be?●       How should things be escalated?  And there's a lot that we can go into that aspect. But without internal controls, nobody understands what the proper steps are, and how do you get that message to the expert. And in terms of fraud, fraud happens every day, and it happens in places that we least expect it. It could be anything from a personal thing, where somebody steals your information unknowingly. All the way up to somebody depositing a fictitious check in the ATM deposit, knowing that it's fictitious. And without internal controls, how do we detect this? How do we maneuver through those processes to, actually, review these transactions? And, then, at the end, do we need to escalate this up through leadership? Does it need to have a certain suspicious activity report filing? And without those internal controls in place is a free fall. Adam:            That makes a lot of sense, and it begs the question, chicken versus egg, do you have strong internal controls unless you've experienced fraud? Or can you have good internal controls, if you've never experienced fraud? What comes first in some cases? A.J.:                Well, a lot of depends on the leaders, and the type of the organization and how they set up their infrastructure. Some organizations are very passive and they are reactive, in terms of waiting for things to happen. Other organizations are saying, "Well, you know what? We're going to be active in this. We're going to be proactive." And a lot of that has to do with that leadership quality. In my opinion, from a fraud expert, you always want to work on the preventive. Because you can always build something, and then do your own risk assessments to determine if there are gaps exposed. Then work together to figure out how to close up those gaps. Instead, of just leaving it open-ended and waiting for the fraud to happen. And a lot of times people just sit because it's easier to wait till something happen, rather than be proactive and build something. Adam:            Yes, that makes a lot of sense. Being proactive does seem like the better option, but it all comes down to leadership and those things. Maybe, we could circle back to what are some of the most common types of fraud that you see in your line of work, maybe, there are some examples. I know you can't name any names, but, maybe, there are some examples you can give and how it was identified and dealt with. A.J.:                Check fraud, is number one on the list. I mean, you would think that in today's world, that we would be doing more electronic payments. But there are just amount of checks that go out on a daily basis. And, sometimes, people just it's easier to write checks, it's easier to send them through the system. But I will tell you the post office is compromised. We are seeing a lot of checks intercepted by third party individuals. Whether it's the postal workers themselves or they're in a partnership, maybe, with the fraudster or they've been approached, and we read things on the news where postal workers are held at gunpoint, their keys are taken, for mailbox. And all these fraudsters are looking for is just checks, where they can either wash them or they can do a forged endorsement on the back hoping that nobody will notice that. Check fraud, is unfortunately not going away, and in the last two years I've seen a significant increase. And there are certain controls that you can put in place, not only for the banks, or the institutions, or the companies, but also for the customers themselves. Positive Pay is really important, where you can look to see if you can be protected and be notified, if there's a counterfeit check that gets presented. You can do a payee Positive Pay, that looks at the payee information to see if it's been washed.  Alternatively, go with the electronic. It's a lot easier on the cash flow, but you also don't have to worry about a paper copy. So check fraud is definitely number one. The other thing we're seeing a lot is what we call Business Email Compromise, BEC, as it's known. And what this is, is with fraudsters, they penetrate into an organization. Whether it's through a phishing attack or other metrics, and what they do is they clone the server once they're in the organization. And they operate as if they are an authoritative figure and emailing different groups, different business units.As well as, maybe, even the financial institution changing payment information or making requests for ACH or wires to go out. And what happens once the clone server is done, the primary customer or the vendor has no idea. And the fraudsters are the ones that are letting certain emails go through, intercepting other emails. So, a lot of times, these customers have no idea that they've been compromised, as well, as they just quickly change that information and say, "Hey, we need to pay this person X amount of dollars." But nobody questions a lot like "Why did this payment information suddenly change from our vendor? We've been sending this to this bank for the last five years, but now we're getting a payment request to send it to a different area." But we just hide behind emails all day long, instead of picking up a phone and calling. So, as a result, the fraudsters hedge on you not picking up that phone, and you're just trading emails, and you're going to just cycle through whatever the request is. And this goes from the customer, to the vendor, to the financial institution, all the way up. And this is where the second area, what we're seeing for fraud, is really significantly increased in recent years. And now with everybody remote, in many places, there are more interactions done on email as opposed to in person. Where somebody just doesn't get up from their desk and walk across to the accounting department, and say, "Hey, we've got a change here." And the accounting department looks at it and says, "Yes, this looks a little different." The third aspect is account takeovers. Where the fraudsters socially engineer themselves onto the victim, as to getting their credentials, in some cases logging in as their victim. In other cases, they'll socially engineer thinking the tech company that somebody has something wrong with their computer, and they will request remote access into the computer, and then do a lot of key logging to retrace some of the steps; passwords, websites. And many people, as we know, because it's hard to keep track of all the passwords, we use the same password for every website we can think of, and all they need is one. And they have sophisticated software to figure out what your passwords are and if they penetrate through. And, in many cases, a consumer is protected by their bank with the account takeovers. But in other cases they may not be, depending on how your financial institution controls, and procedures are designed and communicated. Very difficult to discover when you've been victimized. But a lot of people realize when they see money leaving the account that's not theirs. And I think today's generation, in my opinion, they don't do regular, bank reconciliations of their personal. They just look to see whatever balance they have in the account, and they just operate as they're, I think, that's another area that they hedge on. But the third aspect with account takeovers, is just be very careful. You talk to most places will never come out and ask you for your online credentials, which includes your password, giving out the multifactor authentication numbers. And many times there's a little disclaimer that these institutions share with them, "We will never ask you."But people freak out when it comes time to fraud, and they feel like there's something really wrong with the account. So I would say those are the top three. I mean, we can go through debit cards, credit cards. We can go through the human trafficking and all those other aspects. But I would say those are the top three, at least, that I see today, that are impacting most people. Adam:            Yes, that is in line, and I thought it was very surprising to hear that checks were still the top one. And that goes back to the importance of organizations, to utilizing new technologies like the e-checks and online types of payments that are definitely more secure. Do you think that if more people were to adopt those things that that would come down? Or do you think there are some people just stuck on using checks forever? A.J.:                I think it's mixed. There are organizations, and they're so used to writing checks and issuing checks, it's put in their procedures. And the bigger the organization to change procedures, there are a lot more people that need to be involved. Processes have to be vetted out and then approved, by the senior leadership. So, sometimes, these processes just stay the same for many years to come. But there are organizations that are, actually, taking steps to properly try to combat check fraud and the intercepting of checks, that they'll, actually, start moving towards that electronic model. Now, just because you move to the electronic, it doesn't, necessarily, make you less fraud prone. It just means that you may be susceptible in other areas like account takeover. Where somebody may try to socially engineer to get into the company account, so they can certainly send out bill pays and all that other payment, through their systems.  But, yes, checks, they're always here, people like to touch something. They like something that's tangible, they like giving something to somebody. I mean, if you think about back in the day, my grandparents used to love going to the bank. They got all dressed up, and they'd go to the bank and make whatever transactional activity that they're looking to do, and then they'd take it over to the post office, and they made a whole day of it because they like the tangible stuff. And I just think that, again, it goes where you believe, it's where you're comfortable with.  If you're comfortable writing checks, you're going to write checks. If you're going to take preventive measures by going on Positive Pay, doing a bank reconciliation. Really understanding your institution disclosures that are, probably, how to report incidences of fraud. Then you can have that safeguard measurement to say, "Okay, I'm comfortable writing checks." Others are going to go the electronic route and, again, same process that I just described. So a lot of it is just the comfort level, but it also goes back to the strong internal controls each organization has. To enable that the process is being followed, each time a transaction is made. Adam:            Yes, it makes a lot of sense. So no matter how big your business is because small business might not be able to afford to use some software company, and other ones may not be able to have the room or they don't want to move it. So having good internal controls is the most important thing, no matter how you make your payments. A.J.:                Yes, that's really critical, and reviewing those internal controls, I think, on an annual basis is important because fraud changes, business models change. And, again, I understand the pain points of having to go through, and then getting all the proper sign offs. But if you really want to protect yourself and strengthen the organization, those internal control are really the key for success. Adam:            Yes, so we can't talk about fraud without, possibly, at least, a little bit mentioning the fraud triangle—Pressure, opportunity, and rationalization. How does having a good understanding of that help prevent fraud? A.J.:                The fraud triangle, it's pretty straightforward, and to understand it you have to understand what each component represents. And a lot of times when there's fraud it, basically, is opportunity, "Is there an opportunity for somebody to commit this?" And it could be any type of fraud.  But what happens is there are certain aspects that people try to go through this type of fraud and say, "I have an opportunity. I do not like that company. I can steal money from them, and they'll never know." The opportunity is there for them to take, and in real way, they can do misappropriation of the funds, to try to conceal what they've done.  Now, the justification part, what I call the rationalization, it's really important because this is where they start thinking about, "Well, I'm justifying my action. You know what? My boss passed me up on a promotion. I missed out on some bonuses. You know what? I'm going to take some funds from the company because I'm owed that."  A lot of times, also, during the pandemic, when it first started, we would see people looting stores and creating havoc on the street. And I remember watching the news, one night, and they interviewed one of the looters, and she said, "You know what? I lost my job, I have no financial means. I have a baby. I can't afford diapers. I need to get diapers for my baby." And what they did is she rationalized her situation, as a means of justifying why she was looting.  Now, we can go into the whole ethics and talk about whether that's appropriate or not, but that's not for this discussion. Then, obviously, the motivation, the pressure, that comes through it. It's like, "What is the incentive for them to commit the fraud? What is the payoff?" And a lot of times people just say, "I'm just going to do it one time, no harm, no foul."  But, then, like other aspects, you do it one time, you're like, "Hey, that wasn't so bad, I didn't get caught." Or, "Maybe I'll just increase my next attempt, maybe, from $100 to $200 dollars, see who notices?" And, then, you know what happens is it becomes almost like a game of, "Who can catch me?" Because we all think as kids, we're untouchable when we're outside, at recess, running around playing tag, "Nobody can catch me," and you start taunting.  So the fraud triangle is really put into place, where it's just really just kind of think about from a fraud perspective. Like, why do people commit fraud?  What is their intention and why? What's the rationale behind it? How can they live with themselves after doing something because we have been taught, from young age, "Thou shalt not steal, honor thy neighbor." But the fraud triangles just put things in different perspective. Adam:            It really does, and, I think, it goes back to that gray area, the rationalization, because everybody has a reason for the things that they do. And, you're right, you have to go back to personal ethics and just business ethics because a lot of things aren't so black and white, especially, in today's world. And, so, it's very difficult. And, so, how do you encourage your employees to avoid these things, and to look out for the pressures and the opportunities? Because if you tell them too much about it, maybe, some people will get ideas and say, "Oh, that's a really good idea, I should try that." How do you find that balance when you're trying to educate? A.J.:                That's definitely spot on, that's something that I get concerned with. We build out some of these schemes and how we detect, and then we talk about how we can educate and train others. What information do we provide so it can't be used against us? Really, the first line of defense is hiring the right employees, that's part of where the internal control starts. If you hire the right employees, if you do their background checks. You set them up to manage expectations, understand what is acceptable, what is not acceptable, but also educate them on what they can tell others. We can never tell anybody, in our field, who are filing a suspicious activity reports. So that is instituted on day one, managing those expectations and reinforcing those ideas.  The other aspect we have is we create different materials, and this is how we're able to distinguish what is more proprietary, internally, for us, and what can be shared outside our walls. That if it were to be released, yes, it's informative, but it can't come back and somebody can leverage that against us.  Now, we're not going to be able to cover everything because it's just impossible. But, I think, it really starts with hiring the right people, doing ongoing training. Reinforcing some of these concepts that the organization has, and even, sometimes, putting it to a test and just having somebody call in and see if they can get information out that, maybe, necessarily, shouldn't be. And, again, use this as coaching opportunities. The last aspect of how you can also prevent it is, again, do an audit. Work backwards and say, "Okay, did we let anything slip? Is there something that's out there that maybe we couldn't disclose, that we should have, or vice versa?" And it's critical because you have to not only start somewhere, you got to end somewhere. And it's always good to re-evaluate the progress and then update.  A lot of times what we use are standard operating procedures to outline, what can be shared, what cannot be shared. And we also have separate guidelines that we call unwritten rule. Like, "We don't say this to this team, but we can say this to our team." And that's, again, where you set those expectations from day one. Adam:            Do you think the advent of great technology, that's coming down the road, do you think that will help with the ability to do the constant audit? Because when you were saying all those things about auditing and constantly checking. I'm thinking, "How do you progress, as an organization, if you're constantly monitoring auditing?" But do you think, in the advent of new technologies, will that help companies still be able to advance and become better. But also be able to still detect the fraud, as they're going along? A.J.:                Technology is great when it's leveraged properly. It solves one problem but, sometimes, opens the door for another problem. But I do think that having the right team that understands the technology, understand how it's set up, from the beginning, is really critical in that audit.  Because, a lot of times we're inheriting technology when we start a new job, and we really don't have a true understanding of how decisions were made, at the beginning of implementation. To allow something to go through that, necessarily, we would not want to go through. So the technology aspect, at any point, in what I call the lifeline of it, is you really have to understand what is the full functionality of it, that can help you with those audits. And where there are gaps, that's when you might have to do some manual audit reviews and use different parties from different areas to review it, so you have that proper checks and balance.  Technology is wonderful, it can really help improve efficiencies, point out, maybe, some areas that are exposed. And I think that's what we're moving more toward with AI technology, in the future, as they continue to craft it, and being able to use it appropriately. I'm a big fan of technology. It definitely beats, I would say, the manual process.  But I will say this, if you don't understand and have the basic knowledge of something, it's hard to really challenge that technology. And if I may give a great example. Back in school, accounting, we learned all about T-accounts and we learned about what the debits and what the credits are, and how do you move, and post certain things, and what are the implications behind it because we're physically using these T-accounts. Today, a lot of the accounting is done by software. Where people aren't having that same understanding of where the debits and the credits go. What happened? They're just doing a lot of memorization. They're looking to see, and where technology helps, yes, it helps audit some of those mistakes but, sometimes, it doesn't provide the rationalization as to why it's done certain ways. And when you're looking in fraud, you have to go back to the basics to really understand, "How did we get here?" It's like the root-cause analysis type; in how did we get here? How do we look, and craft, and prevent something from happening? But technology can only get us there on the back end. And that's where you have to be able to create and build something from scratch. Adam:            I think you've really highlighted something really important there. That no matter how far technology advances, it's still important, for us, to understand the basics and the foundation of how things work. Because we can't utilize that technology, properly, unless we understand how it's supposed to work. And that's something that is being talked about in accounting education. And it's really important, especially, with the rise of things like Chat GPT, and the generative AI type, elements. If you don't know how to ask the questions properly, you won't get the proper answers to be able to utilize the technology right, so that's a really great point. And just speaking of generative AI, how do you think elements like that will affect your profession, especially, when it comes to fraud? I'm sure you can use it for good, but I'm sure that other people can use it for bad, just as well. A.J.:                When it comes to fraud, it is definitely a confidence. It's also sort of a bragging right, who can do it better? Is the fraudster better than the catcher? What can they do differently to conceal their actions?  So with AI, I think, eventually, what's going to help is you're using the machine learning, you're using some of the digital imaging, that's out there. And they can look at certain checks, for example, and compare different check stocks between the customers. If one customer uses a certain check stock and, all of a sudden, they see a check that's presented with a different check stock. The system is capable of flagging and saying, "Hey, this doesn't look right, somebody needs to review it." They can also look and learn at the behaviors that customers use. Most people get regular standard paychecks, usually, on certain days of the week, perhaps certain times of the month. And what happens there, it can flag for anything that might be out of scope and look for different algorithms, that are out there, to help flag and detect incidents of fraud. In terms of account takeover, Business Email Compromise, it can almost register where payments have always gone, and then flag it for when there is sudden change of payment information. And, again, it's not designed to, basically, be all and stop everything. What AI can leverage is to help us with the notification. Where it informs us that something doesn't look right, "Here's what doesn't look right, somebody needs to go and look at it." Now, some people may argue, "Well, we just want them to automatically do that." And that's, again, where you have to really understand the behavioral aspects of people. You have to understand how systems work and set things up. And, today's, day and age, we're always looking for the faster, the better, and the ease of working on something.  But if you're in the fraud space, like myself, we like puzzles, we like challenges, but we look at things holistically. And that's really important because not only did one transaction may have triggered the fraud, but there may have been a whole series of other things. And that's where technology, like AI, can help leverage those changes and, at least, give us a jump start when they can look at, maybe, thousands of checks, instantaneously, and say, "Hey, here are five that doesn't quite meet the parameters that have been built." That's where, I think, there's going to be a tremendous amount of value. The downside, again, is that we become too reliant on it and not understand our true crowd, not understand the true behaviors behind something. Adam:            Yes, I really like that answer, and it's going to be a continuously evolving thing. And A.J., this has been a great conversation. It's hugely important to talk about fraud, and I just want to thank you so much for coming on the podcast, today. A.J.:                Great, thank you for having me. Announcer:    This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in, for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Join host Adam Larson as he sits down with the brilliant entrepreneur and CEO of WTS Enterprises, Josh Fonger. In this episode, Josh delves into the captivating topic of the systems mindset for entrepreneurs and business owners. Uncover the secrets behind working on your business rather than in it and discover how this shift can drive exponential growth and success. Josh, with his wealth of knowledge and experience, reveals how business owners can streamline and optimize their processes, increasing profits and reducing time. If you're ready to take your business to the next level, don't miss this dynamic conversation with Josh Fonger.

Looking for expert advice on fractional leadership? Look no further! Join host Adam Larson and guest Ben Wolf as they dive into the world of fractional executives. Ben is the founder and CEO for Wolf's Edge Integrators, a premier fractional COO organization. From fractional CFOs and CMOs to COOs and beyond, Ben will share his insights and experiences on how to hire, manage, and maximize the impact of fractional leaders. Get ready for engaging discussions, practical tips, and real-world examples that will revolutionize how you approach leadership in your business. Don't miss out and listen today!Full Episode Transcript:Adam:            Welcome back to another episode of Count Me In. I'm your host, Adam Larson. And in today's episode, we have special guest, Ben Wolf. Joining us to discuss the fascinating concept of fractional leadership. Ben is the founder and CEO of Wolf's Edge Integrators. A premier fractional COO organization. Today we'll explore the key factors to consider when hiring fractional executives. The benefits they bring to businesses, and even dive into some real-life examples. So get ready to uncover the power of fractional leadership, and how it can revolutionize your organization. Ben, thank you so much for coming in on the podcast. We're really excited to talk about fractional executive leadership, today. And I thought maybe we could start off by maybe you can share some experience, some of your own experiences. That led you to discover this concept of fractional executive leadership, and how it changed your approach to leadership in an organization. Ben:                Sure, absolutely. Well, Adam, first of all, thank you for the opportunity to share about this topic. Obviously something I'm very passionate about. And I first came across it when I was in this business that I first grew up in, entrepreneurially. I used to be a corporate bankruptcy attorney. And after I left that, I helped build this entrepreneurial business from startup. Built most of its operations, it was a healthcare startup, until we had over 130 people and we were the largest healthcare agency of our category, in the entire state of New York.  it was really quite a journey. And ways into that, what we and the other members of the leadership team realized is that all of us were figuring out this business for the first time. It was the first time any of us had been running a business of our size before.  I mean, we'd been employees in larger corporate businesses or cogs in the machine, at various places. But the first time, actually, running a business of our size before. I mean, let's say when we're 50, 75, 100 people, we had never done this before.  And, so, everything that we're doing, we're reinventing the wheel, at a certain point. We hired an EOS implementer, to help us use this management system called Entrepreneurial Operating System. So we tried to get help and consultants, usually, just felt like they just put together some big report and spent dozens and dozens of hours with us, and members of our team, and just would deliver this report and say, "Good luck." Now, I just call that drive-by consulting.  What I just realized is, you know what, sometimes that's what you need. But, sometimes, you need somebody that's, actually, on your team that's, actually, part of the business and that's done it before. That's not just figuring it out for the first time like we were. And, so, we started looking at hiring for full-time roles and, sometimes, either we were just priced out. These people are like 300 thousand, didn't necessarily make sense for this role. Or we realized we need people who've done this before, and we didn't have it. And, so, it wasn't really till after I had left there, and I was a COO at a smaller business after that. And, then, I really discovered this concept of a fractional executive. Where you can actually get an executive on your team. That's not the trauma if it doesn't work out, or the cost of 300 thousand plus bonus, plus benefits, and everything else, of a full-time executive, who's done this before. And, also, maybe, somebody that you might be worried might be too corporate for your environment, and you could actually do that with a fractional executive. You can get someone that's done it before. Whether it's a CFO, or a COO, or CMO, CTO, CIO, CHRO, whatever, something else, and get them on. They're part of your leadership team, they're part of your management team meetings. They have direct reports within the business. And, so, it's like the best of both worlds. You have a high-level person that's done it before, they're on your team. They get to know your business better because they're actually part of your team on an ongoing basis. Not just consulting, "Hey, good luck." But actually managing the people and managing that department, but just doing so on a part time basis. So I just became aware of that and, then, ultimately, started to do it myself. First as a solo practitioner, as a chief operating officer, fractional COO. And, then, ultimately, started building a team, which I have now. But that's sort of the experience I went through. It was what I learned in that business growing up, and not having someone like that, who'd done it before. That made me aware of this solution, as I learned more over time. Adam:            Yes, that's so interesting. Because if you're reading any business application, if you're reading any articles, if you're reading anything in any industry, around business, you hear this term fractional leadership. And, I think, we may have jumped the gun. So maybe we can start by defining what is fractional leadership and how does it differentiate? Because if you're listening to this and you've, maybe, heard this term thrown around. And people, probably, assume, like you were saying, maybe, it's like a consultant kind of thing, but it seems like it's more than that. Ben:                Yes, that's a great question. I basically define a fractional executive or a fractional leader, as the same as a regular executive. Because the regular executive, if you have your CMO, or your CRO, or your COO, CFO, CTO, CHRO, whatever, they're responsible for a function of the business. The CMO was responsible for the marketing function of this business. Not one project, but the marketing of the business. The outcomes, the people, everything, just the marketing function of the business. CFO, and a lot of people listening to this, the audience, maybe CFOs or other roles in the finance, or accounting departments. And CFO is your CFO, they're responsible for your P&L, and finding savings, and forecasting, and strategy, just like a full-time CFO. The only difference between a full-time and a fractional CFO is that they're there fractionally, and they're part time.  So it enables you to afford someone in that role, that is maybe more experienced than you could afford on a full-time basis. So if you don't need someone with a tremendous amount of experience that's been CFO for decades, at multiple businesses, or a CMO at various businesses. If you don't need that, then, fine, you can hire a CMO and let them grow into the role, over time, or whatever, that could work. But if you do need someone that's done this before. You may not be able to afford or might not be able to find just because there's a shortage of those kind of people. By bringing someone fractionally, you can find someone like that. Someone that have that higher caliber. But the way they provide that service is a little different than someone in full time. They're not going to be doing all the all-hands-on-deck admin stuff, working 60 hours a week in your company. And even though they're a CFO or the COO, they end up doing tons of admin stuff, too. Just because they're there full time and they're fully invested in the business. Eating, breathing, sleeping, drinking the business. So they end up doing all this stuff that's not really CFO stuff. They're doing a lot of stuff that's really not CMO stuff. They're doing copywriting, and graphic design, and web work, and all these things. So where your CFO is getting a little bit more involved than they should in the bookkeeping, or the controlling, and not really being that strategic CFO.  But fractional just forces you to say, "Okay, I want to only utilize that person at their highest and best use, at the biggest ROI that I'm going to get from them. Because that's all I'm really paying for." And they will set up a cadence with the finance team, or the marketing team, or the operations team, or whatever, or the technology team, and they'll set up a cadence with them.  They'll set up measurables and processes with the team, that reports to them. They'll create accountability and a cadence for those meetings, and that work. And they'll work with the rest of the leadership team. And, so, they're able to fulfill that role because of that cadence, processes, and the metrics on a more condensed basis.  So they might be with you for six months, nine months, 12 months, 18 months, 24 months, and then hand off to a full-time person. Or you may realize that a fractional can work in the long term, and there's, definitely, a lot of people who will end up doing that, especially, in the CFO roles. A lot of businesses you'll find, and we've seen a lot of CFOs. You talk to FocusCFO, which is a fractional CFO franchise, 70, 80 team members. They'll be years and years, on end, just doing that CFO role, on a fractional basis. It really depends on your own unique business. Adam:            Yes, that's interesting. So it's an interesting model because when you're somebody's, especially, such a high executive, you expect them to be there.Be into the weeds of leading the team, and part of the strategy. How does that work in practice? Because are these fractional executives, are they working with three or four different organizations, at the same time. How does that work? Ben:                It's a good question. I would just get to give my firm as an example, Wolf's Edge Integrators. We have a team of experienced COOs, who have run their own businesses. On average, we're working with about three clients, at a time, on average. Some CFOs I know, maybe work with their client four hours a month or something like that, or eight hours a month. And, so, they're going to just be less involved, and they're going to have a controller and bookkeepers. Whether outsourced or in house, that they're overseeing. And, so, what it means, to be able to get someone of that caliber helping you in the CFO, CMO, COO, et cetera, role, is it forces you to just be more strategic about how are we using that person's time. Because so often when you have executives in a business, they end up spending 50, 60, 70% of their time on non-CFO activities or non-CMO activities. So, really, they're doing a lot of admin. They're doing a lot of things where you're paying them a big executive salary, but you're not getting 90, 100% of their time spent on activities that are a good ROI on what you're paying for them. Adam:            Got you. Ben:                So when you're it fractional forces you to do, if you're using that model, is to ensure that we are outsourcing or hiring for the lower level activities. So that we can ensure that we get a good ROI on our money. If we're like spending money on controlling and bookkeeping, we get a good ROI on that money. And for whatever we're spending on our CFO, we're getting a good ROI on that money. If it truly is a full-time role in the business, then great. Then just try to make sure that they are delegating what they should be. That they are not masking the inefficiencies of the people under them or the processes under them, by babysitting them. And just doing a lot of activity that's not really appropriate for someone of their caliber and capabilities. It just forces you to do that because if you're fractional, you can't mask those underperforming employees with babysitting. You can't mask those inefficient processes and things that have to be reviewed 50 times, by babysitting because they're not there all the time. That pushes those issues to the forefront, and it forces you to address them to get the right people on the team. To get the wrong people off the team, to hire the right roles, outsource the right roles. Set up metrics, accountabilities, processes, and systems that will enable your team to be effective without being babysat. Because babysitting is not an option when you're fractional, but when you're full time it is an option.  And, so, people end up spending a lot of their time on things that they shouldn't and, also, doing what I call helicopter management. Babysitting kind of masking process and people issues, that are not being addressed just because they're always there. Adam:            Mm, well, we could definitely unpack what you just said in a lot of different ways. Ben:                Yes, that's a big one. Adam:            There are a lot of things, but we'll stay focused here on fractional leadership. But the stuff you said, I think, there's a lot of things that could be addressed in organizations, what they should look for. If those things are happening in the organization, or how to identify those things. But, maybe, we can start with, let's say I'm a business owner listening to this podcast, and you're like, "This fractional thing sounds interesting. I wonder if my people are babysitting. I wonder if they're doing those things." How can you determine whether it's a right fit for your organization? How can you make that decision? How can you see that? Ben:                Well, that's really two very different questions. If you want to know if your CFO, or your controller, or whoever is babysitting, rather than being an effective manager and leader- Adam:            That's a whole another podcast. Ben:                ...one thing you could, well, I'll just tell you here's a shortcut. Tell them to go on vacation for two weeks and delete their email off their phone. And as they prepare for those two weeks or as they go through the two weeks, and you see the carnage that is left over, afterwards. Where all the catch up work and everything that didn't get done or didn't happen, or happened badly, that will bring that issue to the forefront. And, then, you'll identify all the things that you need to correct. So, then, maybe, six months, now, schedule another two-week vacation and, then, maybe, you could be much more prepared and fix a lot of those issues before that. Anyway, you just asked that question about how you identify it. And what was the other question you asked? Adam:            Well, how can you determine whether this is a right fit for your organization? So, yes, I did ask the two questions. And what I asked the first time could probably be a whole another podcast, about identifying things in your leadership. But maybe focusing more on the fractional. How can you determine if this is a good fit for your organization? Ben:                I think one thing is that a lot of fractional executives are coming in, usually, where there's some sort of change management needed. And it's not like, "Oh, everything is hunky-dory. We just need a manager, just to manage the greatness that we already have going on. Usually, maybe, there's an acquisition coming up or it's very dysfunctional, and you just really need someone who knows what a finance department is. Let's talk about the CFO role for a second. If they know what the CFO role, what the finance department of an organization, of your type, should look like. Someone who's, again, done it before. They're not figuring it out for the first time. So you want to shape up our finance department to be a healthy department, and have a strategic, not just a controller that just manages the finance day-to-day. But also is actually a strategic CFO and provides strategic financial leadership. And, so, the point is that, in any of those examples, people are going through pain. So one thing that, I guess, I would say if you're ready, is that are you in enough pain with whatever your situation is, or whatever situation you're about to go into. That you are in enough pain, that you want change, and you're open minded to learn a better way. I think some of us, as business owners, we're like, "Oh, I know everything exactly that needs to be done, I just need other people to listen to what I say." And they're not really open minded to the idea that there are experts, who have done this before. That you could actually bring in to fulfill the areas where you're lacking. So that you can focus more energy not on those things, but on the things that you have a superpower in. And whether that's bringing in finance, leadership, COO, leading all the departments, or CMO, or CRO, Chief Revenue Officer, or CTO, the HR, and you're in pain in that area of the business. You want to know something better. You could say it means someone's coachable or someone wants to know a better way, so I would say that's one thing. And, I guess, the second thing I would mention is that, well, you can afford someone of that caliber, but on a fractional basis. Obviously, maybe, it costs 250, 300 thousand to get someone of that caliber full time, plus bonus, plus benefits. But for fractional maybe it costs you 100 thousand, 150 thousand, a year. But you're just giving somebody that you couldn't afford, at the full-time level, but you have to, at least, be able to afford someone at that level, fractionally. So, I guess, can you afford it? Another element of whether that's going to be a right fit for you is, I guess, do you have the trust of a potential outsider. After they get to know you and your business better, to be able to back them up. To not end-run around them. To not undermine the things that they're trying to help you build. So that you want to have an independently running and effective finance department. But if you're going to always meddle in, and undo, and change decisions, and everything without discussing it in advance. Then you're going to undermine the work that you've asked them to do. So do you have the ability to back up and support the experts, that you bring in onto your team. Rather than just never let go and not be able to let go of the vine, as some people say. But just not be able to empower the people that you bring in to do what you've asked them to do. Because they're not going to be effective at that if you're not able to let go. Adam:            So one thing I was reading about that, sometimes, that people are concerned about bringing in a fractional leadership is, "Hey, this is not a full-time commitment. How can I trust them in that moment?" And what are some things that they can think through? You kind of mentioned a little bit that they're going to have to trust them. But how can you help with those concerns? Ben:                I think that, especially, if you're talking to a solo practitioner. You could ask for references to talk to current or past clients, or employers, that that person has, just like with any other employee. Even a fractional CFO, or a fractional CMO, or COO, it's a critical hire or a critical retention, maybe not hire. And, so, that's one thing you could do, obviously, is ask for references.  My own people working with our firm, Wolf's Edge Integrators, usually, our reputation precedes itself. So people have worked with us before. They talk to other people who've worked with us before. They know it's a reputable organization. So you can rely on a reputation of an organization, which can go a little further than the reputation of an individual. More people can have heard of it or might have used them. So that's another thing that you can go to. And I would say it's worthwhile to treat it like you would any other smart hire.  A lot of people make a lot of bad hiring decisions. And, so, I think, it's critical to be, this goes to another thing that, maybe, we were going to speak about. Which is, "Okay, let's say I do want to hire a fractional executive of some kind. How do I make sure that I am successful in the way that I do it, and that it doesn't end up with a bad result?" So I would say one of the most critical things, when deciding whether or not I could trust somebody and letting go. And, also, just in terms of making the decision, whether I should retain a fractional executive or a fractional executive firm, is to really give a lot of forethought to what outcomes do you need from this retention? What skills are important? What outcomes are important? What measurables are we going to be looking at, in this engagement? What outcomes or goals, six, nine, 12 months, down the road, do we want to see? And just be very explicit about that. Write it down for yourself, communicate it openly, and then make sure that's in writing somewhere in the engagement. Hopefully, if they're writing you a proposal or a contract, make sure that's in there. So that there's no misunderstanding or assumptions about what "I'm actually going to be doing in this role." That it's just in writing, it's clear, it's black and white. You're able to be very much on the same page about what's expected. And I would say listen to your gut.  If you're having a couple of calls with somebody, or you have another member of your team, or your partner. Or another member of your leadership team, that talks to the proposed person, that you might be working with, just listen to your guts. And if you feel like they just have this preformed narrative, let's say, about what they do with all their clients. But it's not the same as what I want to get out of this engagement. That's why it's important to write it down, in advance, before you even speak with somebody. What outcomes do I want? What am I looking for?What skills do I need? And, then, just make sure are they aligned with that? Do they seem to get it? That's something I would say. So references, reputation, being very clear about what you want, and getting the agreements in writing. So that there's no misunderstanding about what outcomes or accountabilities are going to be in place. Adam:            Are there certain industries or sizes of business, where a fractional leader makes more sense? Ben:                I think it depends on which fractional role you're talking about. Adam:            Okay. Ben:                For instance, a company is going to need a full-time CFO, sometimes, before they need a full-time CMO, let's say. Or they're going to need a full-time Chief Sales Officer or a Chief Revenue Officer, before they need a full-time CMO. I'm just saying you could have a 25, 30-person business that maybe needs a fractional CMO. But maybe they need a full-time CFO or a full-time head of sales. Because that's the driver of the whole revenue of the business is sales.  So maybe they need a full-time person in the sales role. Although, there are fractional sales leaders as well. But, maybe, that sales role needs to be full time before the marketing role needs to be full time. And you could have a fractional Chief Marketing Officer. You could get someone with a much more extensive experience than you could get if you tried to hire somebody full time. You just end up with somebody that knows copywriting really well, or knows graphic design, or knows social posting really well, or maybe they know PPC, pay-per-click, maybe, they know it really well. But they're not going to be a real strategic CMO to create your entire strategy, and drive execution, and all the resources of that. It just may not make sense to hire that kind of CMO, when you're only 30 people. This may not make sense.  Adam:            Yes. Ben:                I mean, a CHRO, for example, sometimes, you might bring in an HR generalist, not really a chief people officer, but an HR generalist. You could have that full time, when you're 50 people. But, maybe, it's not till you're 150 people or 200 people, that you need a full-time HR person. But you can get somebody, maybe, when you're only 75 people a fractional. So, depending on the role, I would think it depends on when you need certain roles as full time, versus when you need them as fractional. Adam:            Yes, and when you're thinking about this fractional role. I'd imagine in today's work environment, with remote working, hybrid, all those things that are prevalent. A fractional executive doesn't necessarily need to be able to come to the office, all the time, and especially, if they're meeting or if they live in a different location. How does the fractional leader adapt to those types of situations? Let's say a company is completely remote and you'll never actually going to see anybody in person. Are there certain tools that they can use to maintain, and help the leaders maintain that connection and productivity, as they're coming into certain organizations? Ben:                Yes, well, certainly, if it's a mostly remote business, to begin with, or largely remote, or even partially remote. Obviously, that makes it a lot easier and a lot less limited to any geography, in terms of finding somebody. With my firm, Wolf's Edge Integrators, most of our fractional COOs are not working in-person on a week-to-week basis. But for most of our clients, they do come out, at the beginning of the engagement, we'll start to build that rapport with the leadership team in person. And then they'll be there for quarterly and annual planning sessions. They'll get together in person for that, too, I mean, for most of our engagements. But on a week to week basis, with the teams, it's remote. And, so, that's only the majority of the time because, let's say just in the United States alone, obviously, you're all over the world. But even just in the United States alone, you have the likelihood of having a right-fit person, who happens to live within 10, 20 miles of your physical main location is not that likely. And, so, definitely, it helps to be open minded to that. In terms of tools, I think it's important wherever possible to have those in-person touch points and to create that relationship because they are a trusted member of your teams. I think it is helpful where possible to have that. Sometimes your businesses are really all over the world, and it's just never practical to have everybody getting together. At least even on the leadership team level, everybody getting together in person.  So you just do those quarterly, annual plannings, and meetings, all on Zoom, that's just how the entire thing is done. There are definitely good tools, and if you're setting up measurables and processes, obviously, it's important, and there's a lot of systems that work for this. But it's important to have those systems somewhere that everybody has accessible to. So if you're using a CRM to manage your sales, or operations, or processes. Just make sure that the fractional executive is in that system, just like everybody else, and everybody has transparency to what everybody else is doing. For managing meetings, and projects, and accountabilities of managing the business. I find that an online system like ninety.io, n-i-n-e-t-y-i-o is a good platform for managing meetings, and major projects, and major goals, and managing the business, and outlining the vision. And the structure and the accountability chart or the organizational chart, and just managing all of that in a place. Where everybody has access to it, with full transparency, I think a system like that is good.  There's another app that does that called catapult.ai, is another good one. There's an app called Bloom Growth that does it. I mean, I could keep going on and on about this.But there are a lot of good systems that are good for managing companies, and getting everybody on the same page. That is, especially, relevant, even if you're all in the same place, but especially relevant if people are not physically together. Adam:            Mm, so we can't talk about a fractional CFO without thinking about, people could be listening to this saying, "That's interesting, I think I could do that." What are some considerations somebody should think about or steps they should take, when thinking about going at this type of thing? Whether through as a solo person or joining an organization that does that, kind of like Wolf's Edge Integrators. Ben:                Sure. So what I would say, the first thing people should be mindful of, if they're thinking of going into this field. Which, obviously, I love it, it's a great field. I think that the reasons why a lot of people go into this are what I call the three mores. Which is more fun, more flexibility, and more money. It's more fun in the sense that because, as we spoke about earlier, you're working on these higher order activities. Where you're making much greater impact, a lot less of the admin or non-higher impact activities which is more fun. Because you feel like you're making a big difference. You're spending more of your time on more high impact activities. So you get more satisfaction from it. You get a satisfaction from driving major change. Not just managing something over ten years, you're actually seeing major impact on your efforts. So that just makes it more fun and more satisfying. There's more flexibility because when I mentioned, typically, people are working, if let's say you're working about three days a week, three clients at a time. And that's about three days a week of client time, and then about two days a week of buffer time. Working on your own solo practitioner business, on business development, on networking, and on driving your kids to a sports conference, and taking off a Friday, or taking off a Monday. And just that extra flexibility is a nice quality of life for people that want to go into that. And the other thing is more money, which is that you can honestly make more in about three days a week of client time. Than you can in most full time, even executive roles. Because, again, it's scalable, you only pay for what you're getting. So by the hour, so to speak, you're getting paid a lot more.  And, so, what the client gets out of that, is they get the flexibility. It's not a full-time hire, it's no big overhead, it's less of a commitment. They could end it after nine months, you achieve what you need and then you end. But it's not so nice to fire your CFO after nine months. But if it's fractional, that was the plan to begin with.  So you just have that flexibility, but you pay for that, if you convert it to hourly, so to speak. So you make more money than you do with the full time, at least, when you're fully booked or close to it. So that's what I would say. But, then, how do you know if it's for you? So one thing I would keep in mind is that, understandably, you can't be effective doing exactly the same things that you did when you were full time.  Adam:            Yes. Ben:                You just have to recognize that it's different. You can't be effective in driving change and getting results, on a fractional basis, with just a few hours a week, or a few hours a month. As you can when you're full time, when you're there all the time, it's just very different. You have to recognize that it's not just more of the same. It's going to be a brand new set of skills, there are a lot of things you're going to have to be very mindful of. And the last, at least, high-level point I would say is that it's important to understand is that business development/networking/building a pipeline of potential clients, especially, if you're a solo practitioner, is part of your job. If you don't view business development as part of your job, and it will always be part of your job. Not just when you're first getting started, but always be part of your job. If you don't love that or at least recognize and embrace it, as the reality, then, you actually won't be successful transitioning to fractional. You may feel like, "Oh, I'll just do some big effort when I first go independent." And, then, maybe, that works, sometimes, that will work, and then you'll stop. You'll get, let's say, a full load of clients for the first time, and you'll stop doing business development. But, ultimately, your network and the network of your network, eventually, peters out and you'll, eventually, have no pipeline. And your clients will end, vast majority of them will end, at some point. So whether it's six, nine, 12, 18 months down the road, your clients will start to end. You'll find yourself with no pipeline, no clients, and getting back to panic mode, and you'll just find yourself in this feast or famine roller coaster. That is just not giving you the three mores, not going to give you the life that you think you're going to have. So the biggest thing I would say is are you able to embrace the idea of business development, as a long-term part of your job description. Just like client-service is a long term part of your job description. Adam:            So there is a lot more to think about when you go at it as a solo, as opposed to joining a firm who's doing it, right? Ben:                Yes. And there are all kinds of firms, some firms you still have to do a lot of business development, some you do less. So there's a big mix of how that works. Now, the other resources I would point people towards, if they want to learn about this or exploring going into it. Is, first of all, I mean, read my book, it's written for business owners. But I've had fractional leadership landing executive talent you thought was out of reach. I've had a ton of people who tell me that, even though, again, it's written from the perspective, or for the business owner is the audience, that as going into it, it helped them tremendously. It gave them terminology, gave them a good understanding of what it takes, so definitely read the book. It's on Audible, paper, hardcover, Kindle, whatever.  Another thing is there's a good community with a lot of education, called Voyageuru, V-O-Y-A-G-E-U-R, like voyagaeur V-O-Y-A-G-E-U-R-U, like university .com, and it's only 19 a month, I believe. They've also got a boot camp, they've got courses and materials.I'm not affiliated with them in any way. But just pointing that out as a useful resource as voyageuru.com, as someplace to go to learn more about it, see if you're cut out for it. You'd also connect to the community there, with a lot of other people in the field. So it's a good thing to consider, to learn more. Adam:            Yes, that's great. We'll try to put some of these links into the show notes for the audience, so they can check out Ben's book and everything. And, Ben, maybe, as a last question, to wrap up the conversation. This has been a great one. How do you see fractional leadership transforming the business landscape, as we go into the future? Ben:                I think the biggest thing I see about it, first of all, it's been exploding the last few years. I mean, it's been around for decades, technically, especially, the CFO field, that's really the first field where it really exploded. But over the last five years it's grown a lot. I mean, post COVID, it's gotten even bigger because of what you referenced earlier. People are getting more open minded to not being physically present with people. And even though that's not the same as fractional because you could have fractional that's also in person. But it just opened people's minds to finding talent in ways that they were closed to earlier. So I think that's part of why it really expanded even more, with the advent of COVID and all the lockdowns. But I would say that the biggest impact it makes on businesses. What it's really done is it has democratized access to very high level, very experienced talents to an extent that didn't exist before. Because if the only way you could hire a CFO was full-time hiring a CFO, and that was prohibitive, for some reason for you, then, you had no access to that talent.  Adam:            Yes. Ben:                But what it's done is, it's democratized and allowed smaller and smaller businesses. First it wasn't just the big companies. Now, then, it's the mid-sized businesses, and then it's democratized down even to small businesses that can now access and have people of that caliber. Who've run those departments, or run companies, or owned companies before on their teams, as a regular part of their leadership team, just doing so fractionally. So it's just democratized access to much higher level talent, to much smaller businesses than who previously had access to it. So I would say that's the biggest thing that's transformative about it, and makes it useful. Adam:            Mh-hmm, well, Ben, I want to thank you so much for coming on the podcast. I know I've learned a lot today and I hope our audience has as well. Ben:                I appreciate it. And I would just say, also, even without getting the book people go to wolfsedgeintegrators.com/resources. There's actually a free chapter of the book, chapter one of the book, you can get access to it there, and it doesn't cost anything. I just want to put that out there as well, if people want to learn more.Adam:            Yes, and like I said, check the show notes and we'll put a link to that, in our show today.  Ben:                Awesome, thank you for the opportunity, Adam. I hope it was a value add for the audience. Adam:            Thank you.  Announcer:    This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

In this episode, host Adam Larson sits down with Ashish Gupta, CFO North America at Reckitt, to explore the CFO's role in driving a sustainable earning model for businesses. Discover how Ashish's diverse leadership experience across continents has influenced his approach to sustainable growth and learn valuable insights on strategy, transformation, and execution. Get ready to expand your financial knowledge and gain actionable tips for driving success in your organization. 

In a rapidly evolving accounting landscape, how can professionals demonstrate their skills and experience to stand out? Certifications! In this episode, veteran accounting educator and President of HOCK International, Brian Hock outlines the immense value of professional certifications for career-long growth and development. Learn how certifications like the CMA provide a standardized body of knowledge to showcase specialized expertise. Discover how the right certifications position you for success as technology and demands transform. Gain perspective on certifications as a strategic investment in your future, increasing opportunities and earning potential over the length of your career. Brian draws on extensive experience preparing accounting students and professionals for certifications to offer advice on overcoming barriers like cost or study time. He provides encouragement that passing rigorous exams like the CMA, while requiring dedication, is very achievable with the right preparation and planning.If you're looking to get strategic and maximize your career potential in accounting, this episode is a must-listen! You’ll come away motivated to pursue professional certifications and equipped with insights to choose the right certifications for your goals.

In today's episode, host Adam Larson is joined by the esteemed authors of the 2023 Curt Verschoor Ethics Feature of the Year titled "The Value of Civility" - Amanda Marcy and Doug Parker. Get ready as they delve deep into the importance of civility in the workplace and its connection to professional ethics and ethical standards.Did you know that even seemingly inconsequential or inconsiderate words can violate workplace norms? In this fascinating conversation, Amanda and Doug shed light on various aspects of civility, including its impact on workplace morale, productivity, and employee commitment. They also explore the role of leaders in promoting a culture of civility and providing guidelines for employee conduct.Through insightful discussions and real-world examples, you'll gain a profound understanding of how civility not only enhances workplace harmony but also influences ethical decision-making. So whether you're a leader aiming to foster a respectful environment or an employee dealing with an uncivil boss, this episode will equip you with the tools to navigate challenging situations. Tune in today!

The future of accounting is here, and it's automated! In the latest episode of Count Me In, we unravel the world of accounting automation, AI, and the exciting changes that technology is bringing to the industry. From enhanced efficiency and productivity to the ethics and potential challenges of integrating artificial intelligence, this episode covers it all. Our expert guest, Jesse Rubenfeld, CEO and Founder of FinOptimal, will discuss the way accounting is being transformed, the new skills professionals need to master, and the fascinating possibilities that full automation offers. Tune in, level up, and discover what the future of accounting holds!Connect with our presenter:www.finoptimal.comhttps://www.linkedin.com/in/jesserubenfeld/Full Episode Transcript:Adam:            Welcome, listeners, to Count Me In. Your go-to destination for insights into the future of finance and accounting. Today, we have a special guest with us, Jesse Rubenfeld, CEO and founder of FinOptimal. He is an expert in accounting automation and AI. We delve into a conversation that may redefine how you perceive your profession. How is automation shaping the accounting landscape? What are the new skills that financial professionals must adopt? And what does the full automation mean for traditional jobs in the field? Sit back and join us in this exciting journey, as we explore the transformation of accounting in the age of automation. **** Well, Jesse, we're really excited to have you on the Count Me In podcast, and today we're going to be talking about automation and accounting. And to start off, maybe, at a high level, we can talk a little bit about how has automation really impacted the accounting and finance industry, and what benefits has it really brought to it? Jesse:              Well, I think it's really been a benefit to the profession, that's the headline. It's taken it from a place where there was a lot of manual block and tackle. To an elevated role where the accountant, the finance professional, can be a thought partner and spend most of their time analyzing and adding value to the message that they provide to management, to the CFO, to investors, to whoever it is. Because they're spending less time managing spreadsheets, or uploading things, or doing data entry, and more time being smart. Adam:            Yes, they have more time to focus on other things. Maybe we can talk about what are the specific kinds of automation, that are really impacting those operations. You mentioned some things that are taking us off of spreadsheets. But are there other things that are really impacting it? Jesse:              Well, in this situation I like to differentiate between accounting practice automation and accounting automation. Accounting practice automation involves task management workflow. Facilitating review and approval of work papers, tracking time spent on clients. It benefits the accounting firms, but it doesn't, drastically, increase capacity. And it's only beneficial for internal accounting teams, at a certain size. Now contrast that with accounting automation, which involves calculating and recording journal entries, reconciling transactions, generating reporting. This benefits accounting firms and their clients directly. It increases capacity for firms, and it increases speed and accuracy so the clients aren't sitting around waiting for answers.  Internal accounting teams can benefit from this early on. One person can benefit from this. One person can do the job of five, whereas it's unlikely they'd use accounting practice automation in a one-person finance team. We also like to distinguish between automation and automation assisted. Automation assisted means it's faster than fully manual, but it's still manual at lots of parts. Whereas automated means one event triggers all of the subsequent actions, automatically. And I like to illustrate this with a side-by-side example. Okay, let's say you're using HubSpot, the CRM, and QuickBooks Online. You close a sale, you have to invoice for the deal and then you have to account for it correctly. And deals, sometimes, have different payment terms. "I'm going to pay all up front, I'm going to pay monthly." And they have different agreement lengths; annual, quarterly, month to month. An automation-assisted process looks like this; a deal is marked closed, one. Accounting gets an email, they fill out the details in a spreadsheet that contains a revenue waterfall schedule. They make sure the formulas are correct and then they copy down through all of the columns, et cetera. And then once a month they go book an entry in QBO. Whereas automated, fully automated, means the deal is marked closed, one, in HubSpot. Data flows from the CRM to QBO automatically. The invoice is sent, automatically, and the invoice is coded in a way that the revenue can, automatically, be recognized in the appropriate periods. That's what we're doing for our clients, full automation. Does that make sense? Adam:            Yes, that makes a lot of sense. And, so, as you're describing those two things, the full automation is almost eliminating traditional jobs that have been in the finance function. So when you were talking about this full automation. There are new skill sets that are involved that are needed for it, and you've seen lots of articles. But maybe we can talk a little bit about that. What are some new skills that accountants are going to need, going into the future? Because full automation is on its way, in a lot of the functions. Jesse:              Totally. Again, the headline here is it's elevating the high performers of yesterday. So that today they can do more, better what they're already doing. In terms of new skills, it comes down to more systems and data analysis. SQL, for example, in our case, Python, if you really want to go crazy. I long ago went crazy. But I think that in the past, somebody who could do the higher level work of managing, of communicating financial pictures to important stakeholders like the CFO, the CEO, investors, they would do that, but they'd spend a lot of time preparing for those things. It would be a major event to get ready for a board meeting. And the amount of time that it took to do that right, was a barrier to entry of competitors for their job. Whereas now they don't have to spend that time preparing for it. Meaning they can use automation to do a much better job, of keeping things ready for the board meeting in real time, all the time. But it also means that it's not as hard for someone to come along with the same skills and replace them. Because they no longer have the luxury of designing their own really convoluted, excessively complicated process, that another skilled accountant can't come in and replace. So it's a double-edged sword. But, overall, it's making everybody more productive and therefore is good for business and the accountant. Adam:            Yes, it is good for business because it helps your bottom line, it helps get things done more efficiently. But I can imagine that changing from no automation or some automation to full automation, probably, has its challenges. And maybe you can talk a little bit about what some of those challenges are, and what are some of the opportunities that come as a result of that. Jesse:              Sure, first of all, when I talk about automation, in response to your previous question. I think, there's a caveat that you can't hope, even with Chat GPT, in my opinion,                        and the AI that's out there, to fully automate any given business's accounting. You absolutely need a person in the loop, if nothing else, to review and approve things before money goes out the door. It's about control. Having said that, you want to automate as much as you can and there are challenges associated with that. At the top of the list is, carefully, considering what you're automating before you do it. This is one of the biggest pitfalls. People just buy some software, and they're knee-deep in the implementation before they realize, "Is this what we want? Is this what we want the process to look like?"  Sometimes software companies are selling to someone, the decision maker is not the user. And I think the way to avoid that is to consider, at once, the people, the process, and the technology that drive those two together, that work together to get the result. The challenge is about; it's not about, "How do I fully automate this? It's about what do I not automate? Where do the people fit into the process that is optimally automated, and what software products are going to help us get there? And sometimes what services are going to help us get there?" Because we do both for our clients. Adam:            Yes, so it sounds like when you're implementing something like this. It can't just be the decision makers making the decision. You need a wide range of a team to make sure that you have the people who are going to be doing the work in there. Looking at this thing, saying, "Hey, this is going to help me." Or "No, this is not going to help me." Because, otherwise, you're going to go into that example that you just stated. Jesse:              Absolutely. When we're pitching our software, or our services, for that matter, we like it, I mean, sometimes we'll get a high-level intro to the CEO. Someone who's definitely not the user and they'll like the idea, but we don't want them to buy it. We want them to have another call with us and their users. If it's an accounting firm, we want the members of their CAS practice, that are actually going to use our software to do their clients books. So that they see what we're doing and say, "Wow, this technology is going to help me improve realization fivefold.  We want the VP of finance who's actually going to have to use our product or consume our services to understand, "Wow, that's going to save me something, so I want that. How do I get that?" As opposed to selling to the decision maker and hoping it works out down the road? It's almost like we want to start the implementation in the discovery, in the sales process. We want the sales process to inform the user not, necessarily, the decision maker. We want the CAS practice operators to go to the partner and say, "Please buy this." Adam:            Yes, and it sounds like organizations and companies can make a better decision. The more practitioners, the more people they have in that decision-making process, at least for the review. Obviously, one person has to make the final decision to say yes. But you need more voices in that input. Jesse:              Of course, you're looking for consensus. You're looking for the users who are going to train other users.Who are going to advocate for you online, where they hang out and learn about cool products and discuss them. And it's about getting buy-in from the stakeholders that are using your products and services, first. Adam:            So you mentioned Chap GPT, and you can't talk about automation without talking about artificial intelligence, machine learning, those are huge. It's all over the news, people are talking about it. I just recorded a podcast the other day, talking about it. I'm going to be recording one in a few weeks, talking about the ethics of it. So there are so many things involved in it. What role do you think artificial intelligence, AI and machine learning, are going to play in the automation of accounting and financial operations? And, obviously, there's going to be benefits, but what are those benefits going to be? Jesse:              I think it's going to be a strong partner. I don't ever see it replacing an accountant, altogether. Meaning we have no person in the accounting function it's entirely an AI because every business is different and it's generative, but it's not creative. And I think it's going to be about I've got a problem that I haven't dealt with before.                         Where previously I would have to do seven or eight Google searches. Now I can have a conversation with an AI, get an answer that's kind of close but not great and say, "No, that's not what I meant." And it's going to be different and better gathering data from the Internet. But it's the future and therefore hard to predict. It's going to be useful, that's for sure. But I don't think any accountants need to worry about their jobs. Adam:            Huh, that's good. Obviously you have the science fiction that's out there, that shows the AI is taking over and they're making all the decisions for us. And I hope that we never get to that future, that science fiction has predicted. But when it comes to things like ethics, and fraud, and stuff like that, obviously, you can put different elements into the AI, and the machine learning, and the automation, to eliminate those steps. But do you think people are going to be able to find ways around that, and find ways to still do fraud in the midst of the automation and the internal controls that are put into place? Jesse:              I have no doubt. When the cat is away the mice will play. Adam:            Yes, and it's hard to say how that's going to happen. Jesse:              I just think it's a cat and mouse game. There are always going to be people who want to operate outside of the law. And the tools to detect it are going to get better, and the tools for perpetrating it are going to get better. Expensive software doesn't solve for bad people and bad processes, though.  Adam:            That's true. So talking about data, obviously, data is a huge part of this. You mentioned that that's a skill set that people are going to have. And then also, obviously, quality control, you've mentioned there's going to have to be somebody there who's going to have to check things as it goes through. But in the context of automation, and accounting, and the operations, what steps are going to be taken to ensure that there is going to be accurate and reliable results? What steps are we going to have to take to make sure that that happens?Jesse:              I think you need to implement your system with agility, iteratively. I think the first time you try whatever system you just implemented, it's not going to be exactly right. It should be a big step in the right direction. But you're going to have to do a lot of testing. And you don't want to have the expectation that, "I'm going to implement a really expensive large general ledger. Have some consultants come in for two weeks. They're going to get it right and then they're going to go away, and my life will be better." I think that's the naive way to do it. It's got to be, "All right, we're going to take a step and then we're going to take another step. We might have to take one step back, after two steps forward." In terms of accounting data, quality control, reconciliations will always be a part of the process. It's just that the time that it takes to do them will shrink. I think the laborious parts, the real rote elements of accounting work, are going to continue to get smaller, but they'll still need to be done. Otherwise, how can an auditor give an opinion, that statements are materially free of fraud. It doesn't go all the way.  Adam:            Yes, you have to have those internal controls in place. Outside of the system, you have to have those things in place to make sure everybody stays accountable. Jesse:              Totally, 100%.  Adam:            Yes. Jesse:              And at the end of the day, the people are at the top of those systems. I just don't see us; you can detect abnormalities with systems. You can flag things. But I don't think the IRS ever figures out a way to, automatically, correctly, identify everyone who's cheating on their taxes. It's going to flag some stuff. It's going to get better at flagging some things. But the flagging need to be tuned, so that the people who are making decisions can use that information to make better decisions. The people are always going to be at the top. Adam:            Yes, so let's say you're somebody in the accounts receivable or accounts payable department, and your job has been to send the invoices out and organize those things. And your company is saying, "Hey, we're bringing in this system that's going to send the invoice, automatically." What would you say to that person who's been sending those invoices out? What would you say to that person, today? Jesse:              I'm going to save you a ton of time and you can learn how to do payables, and be twice as effective with your time. I think the accountant who fears automation is truly in trouble. They may stave off the automation of that invoice process for now. But eventually someone's going to come along that makes it painfully clear that you should have done this a long time ago, and you're going to get fired. It's much better to embrace the automation and say, "Wow, I'm buying back half of my week that I can now spend..." in my case, it was learning to code. That's what I love to do. But it could also be learning more about a different area of the finance function than you were exposed to before. People who are ambitious are going to find a way forward.But automation is not going to replace accountants. Accountants who use automation will replace accountants who don't use automation. So embrace it, learn the new skills, elevate your game. Adam:            So it's almost like if you're sitting in there and you're listening to this podcast, and you're like, "Hey, my company doesn't do that." You can be the one to bring the idea say, "Hey, I have this new idea to save us a bunch of time and we can do this X, Y and Z." You can bring that idea forward and help elevate your company, and then it'll elevate you probably in your organization. Jesse:              Yes, and I think what you just said is a role now in companies called finance transformation. And, by the way, if you think that you're good at that, please look me up because we want you to join us. Adam:            Definitely. Well, look in the show notes, today, and we'll have a way to contact Jesse either through LinkedIn or some other way. So look at those show notes for today's episode. So we've covered a lot of great things during this conversation, and if you're a finance and accounting professional listening to this conversation. What ways do you recommend that they can stay up-to-date to the latest technologies, the tools? What resources are out there that they can help them stay on top of this? Because, obviously, like you said, the accountant who understands and knows how to work automation is, probably, going to replace the accountant who does not embrace that. So how can accountants stay up to date and then start embracing it, themselves? Jesse:              I mean, first and foremost, if you're an accountant and you want to keep your job, for God's sake, listen to Count Me In, it's an obvious win. There are a lot of podcasts that touch on automation and I think it's to, a large extent, about keeping your ear to the ground and finding out about new things. But there's also Slack channels like Off the Ledger, join CFO groups, follow people on LinkedIn. Follow me, Jesse Rubenfeld and you'll hear about a lot of exciting stuff.  Adam:            That's great. Well, and, obviously, there are magazines out there. Don't sit there and sit in the dark and think that if you sit in the dark nothing's going to happen. But keep your ears to the ground and pay attention because, otherwise, it's just going to pass you by. You need to jump on the train and don't let the train pass you. Jesse:              And, hopefully, it's something that's exciting. Wow, we can prepare these invoices, automatically, and send them out. So many cool things are happening in the industry. So many cool software companies are coming up with new things that are making your lives better, as accountants. Elevating the profession, giving you back time to take your career in the direction you want to take it in. And the more you can embrace that energy, the more it gives you optimism rather than fear of, "I'm going to be replaced." Adam:            I agree, 100%. Well, Jesse, thank you so much for coming on the podcast. It's been an absolute pleasure talking with you, and I think the information that you provided will really help our audience to really look forward to the future and be better. Jesse:              Thank you so much. Announcer:    This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Dive into the fast-paced and exciting world of artificial intelligence with our podcast series! Join our expert guests, Dr. Mfon Akpan and Dr. Scott Dell, as they unravel the mysteries of AI, explore the cutting-edge developments in language models like ChatGPT, and discuss the massive impact of these technologies on industries like accounting. From the thrilling acceleration of AI adaptation to ethical concerns and security implications, this podcast explores it all. Tune in to stay at the forefront of one of the hottest topics in technology today!Connect with our speakers:Dr. Mfon Akpan - https://www.linkedin.com/in/drmfonakpan/Dr. Scott Dell -  https://www.linkedin.com/in/drscottcpa/SF Magazine Article by our speakersFull Episode Transcript:Adam:            Welcome to Count Me In. I'm your host, Adam Larson, and today we're diving deep into the world of AI. A subject that has been making waves across industries. Transforming the way we work, communicate, and think. With me are our esteemed guests; Dr. Mfon Akpan, Assistant Professor of Accounting at Methodist University. And Dr. Scott Dell, Assistant Professor of Accounting at Francis Marion University. They bring a wealth of knowledge and insights into AI's history, its current impact, and what's on the horizon.  We'll discuss everything from AI's phenomenal growth; to its applications, ethics, security concerns, and much more. So buckle up and let's embark on this fascinating journey into the digital revolution. Adam:            Mfon and Scott, thank you so much for coming on the podcast. We're really excited we're going to be talking about AI and ChatGPT, and all that comes underneath that. And we're really excited to have this because this is a very hot topic, and people are talking about it. You see articles about it every day. You see updates, you see leaders writing letters saying, "Let's stop all AI for six months." Et cetera. Maybe we could just start at a high level. What is AI? What are these chat bots? What are these things doing for us? Scott:              Amazing tool, and thank you for having us. It's a pleasure to be here and to share. I'll kick things off, Mfon, if it's all right. This artificial intelligence has been around for over 60 years. So you say, "Wait a minute, why is it so new?" Well, what's new is the capabilities because of the computing power we now have. And the tool is amazing; it is changing life as we know it. We haven't seen the likes of this since the printing press. It's an environment that can really do things, change work, augment work, replace work, but makes things better. Your thoughts, Mfon? Mfon:             Yes, and I think some of the excitement around it is that we haven't seen this type of growth, in a platform as well. So you think about it was released, November 30th 2022. Five days, the platform got a million users. So you think about in 2010, it took Instagram two and a half months to get to a million users. So there's a lot of excitement, and then there's a lot of acceleration and speed around the platform, as well. Scott:              As a follow up to that, 100 million users mark was reached in two months. Compared to TikTok, I think, it was nine months to get that far, that fast. So it has been an amazing adaptation of the technology. Adam:            So maybe we can talk a little bit about how does it work. And, then, from there, maybe, talk about what benefits it may have for the accounting profession as a whole. Mfon:             Well, it's a language model, so it has an interface. So you're able to go to the platform, you go to the website, and you're able to ask it questions, or you can copy and paste information and ask it to do things. So from the profession side, if you're asking it to solve problems. You can ask it to solve a problem, or you can have it write an email, write a letter, it can produce content for you. Scott:              And as Mfon mentioned, it is an LLM, one of those three-letter acronyms, a large language model. But what it does is it projects words. So it looks at the previous word and it says, "Mm, what would the next logical word be?"                          Which, sometimes, if you've ever played the game of telephone, as a kid, sometimes, you get to the end of that line and nothing resembles how it started out. And that sometimes happens, as well, with the ChatGPT and GPT-4 environment. Because it is projecting with probabilities, "Yep, I think this is the next word." And sometimes it's dead wrong. It's called hallucinating, it's the actual technical term. Mfon:             It does hallucinate. But what's so fascinating when you use it, it is projecting. But I guess it feels like you get the impression that it's thinking, even though it's not thinking. So you can ask it questions and it will give you answers, so there's that interaction. But it is projecting and it does, sometimes, hallucinate, or make up answers, give you false information.  Scott:              And the fear I really have, in the hands of professionals, we can, probably, take a look and say, "Oh, this isn't quite right. This is illogical." But for a novice, and for newbies like our students, they will look at this and say, "The English is so good. It just flows so, logically, it must be right." And it's not, although, often enough it is right. So there's a balance. Adam:            Yes, so talking about people using it. Obviously corporations, people within corporations, within organizations, are using it. Within the accounting profession are using it, and people are having to create policies. There are new workarounds coming out there. People are saying, "Okay, you can use this, but you can use it for that." I saw one example, where somebody put in a fake balance sheet and said, "Analyze this for me." And it gave a really interesting analysis. Then, you have to worry, "Oh, am I putting somebody's data into this thing?" And you have to worry about those things. And, so, how can this tool be used for management accounting? In the accounting space, obviously, without giving away too much personal data? Scott:              Security consciousness is we need to be there. I mean, you're hearing about the deepfakes. I just heard about a scandal in Hong Kong, a banker that sent millions of dollars, based on what sounded like the voice of the person, the CEO, that was asking for the money, and millions were lost.  So there are a lot of nefarious uses out there. But there are a lot of positive uses, and using it in the business environment. I mean, there are a number of businesses that have banned it as well. School systems that have banned it. But there's a lot of fear in the air. I think there's more hope than fear, though, and more opportunity. Mfon:             Yes, there is more opportunity. And from an interview that I read with Ilya Sutskever, I hope I'm saying his name correctly, he's the chief scientist at OpenAI. From what he was explaining, they consider their value with the platform is the reliability.So there's a focus on updating and moving the platform to become more and more reliable, as far as the output. And he was explaining, if you look at the jump from the 3.5 to the 4.0 version, you see that there's a movement towards this reliability.  On the other side, if you watch the interview with Sundar Pichai, from Google, when he talked about Bard, similar, well, I shouldn't say similar, he called it guardrails. So they're releasing Bard and they have it out there, so that they're testing it. So it's twofold, they're getting the public used to the technology and, at the same time, they're testing it so they can slowly release it and put in, as he called it, guardrails, with the technology. As they further release it and develop it. So I think all of this is in mind, as it moves forward. Scott:              And we started off with the pace of adaptation of this tool. The pace that we are needing to adjust to it is also very quickly. And, Adam, you brought up a great point about security concerns. Putting in somebody's private data, PII stuff. You're looking at it and saying, "Wait a minute, is this recording me? Is it going to take it? Is it going to repackage it and spit it back out to somebody else?" And the short answer is it very well could be. We do have the rightful fear, but we're all getting used to this. It just has been such a rapid ramp up and the guardrails do need to be in place, and everybody's concerned about that.  But take for example, if you wanted to get scammed and you're saying, "Okay, we're going phishing. Give me a phishing email that's going to be effective with this kind of tone or whatever else." And now there are guardrails in the place to hold you back and saying, "We're not going to do that." Then you say, "But I'm an educator, and I want an example of a phishing email so I can demonstrate for my students that this is not the right thing to do, but look how powerful it can be." And that also used to trip up the AI and say, "Oh, okay, yes, let me give you an example." And there's ways around it, and all kinds of folks are trying to get into this, we'll call it the black box, and take advantage. It doesn't take very many bad players. But most of the folks are good players that are using it to their advantage, in the workplace.  But we mentioned earlier a number of companies, folks like JP Morgan, and Bank of America, Goldman Sachs, that have banned it for internal use, and there must be a reason as well. The banks, I can see where they'd be real concerned about their security. Adam:            Mh-hmm, yes, I've been reading, too, that there's a lot of concern about privacy of data. And even when I've talked to folks, internally, at our organization, are like "Oh, can we use it?" "Well, just be careful what you put in there." "Okay, well, can we have some more guardrails around what I'm supposed to put in there?" Because when you're using these tools, it's all about asking the right questions. And if you don't know how to ask the right questions. Soon enough, we'll see courses out there saying, "How to ask the right questions to ChatGPT." Scott:              I actually talk about that; it's called prompt engineering. Six months ago, we didn't even realize it existed, even though it did exist at that time. But right now there are so many new job opportunities in this prompt engineering. How you ask the questions. I used to call this a Google on steroids. I've had to change my tune because Google, you just do a quick ask. And yes, you can get away with that in ChatGPT and GPT-4. But really, you really want to set the stage, tell it what you want. The format you want it out, the tone you want it to project. You really have to have a pretty well developed question, and there are some methodologies to do that, to properly ask a prompt. Mfon:             Yes, it's a good point. And if you think about it, with this chat bot technology, it's still in the infrastructure phase. So you think about companies, they're still working on the whole infrastructure and, to some extent, they're building it while it's flying, if you think about that. And eventually it'll reach a point where we'll get to the application phase.  But a lot of this, in my opinion, is moving way faster than we've seen before. So it's not new, but it's faster than before. So I try to think about if you think about social networks, social media because they compare, like Scott was saying, reach a 100 million monthly active users, or MAU, that's one of the metrics for social media. You think about 2002, there was Friendster. I don't know if anybody remembers Friendster.  Scott:              We actually do. Adam:            2003, Myspace, and that had 25 million users, and that was one of the top websites out there, at that time. And, then, Facebook comes along, Twitter, and then now you've got TikTok, a billion monthly active users. And, I think, Facebook is at 1.9, or something like that, billion monthly. So if you look at it in that way, it's still moving. But this isn't happening from 2002 to the 2020s. This is happening, really, if you look at it, in months. We've seen a lot of exponential growth. Scott:              Yes, the modern AI, as we know it, as we see it, is still in its infancy. And there's been discussion something about AGI, and you're talking about Artificial General Intelligence. Which is the level of where it's going to be in, who knows, six months, two years, five years, 10 years. I mean, GPT-2 was released back in 2019, then we had GPT-3 in 2021. So it has been ramping up. But, well, just wait till this stuff hits adolescents. We think our kids are off the guardrails, let's watch out for ChatGPT, and GPT-4, and GPT-5 eventually to come. Even though they put the brakes a little bit, they're slowing that down. Mfon:             Or another platform or that'll rise up. Adam:            Yes, I was just going to say that. You mentioned Myspace and then it was taken over by Facebook. Chat GPT is the big one now. I mean, I remember Myspace, I had a Myspace page, and then Facebook, I was like, "What's Facebook? What's this new thing?" And everybody gets the Facebook page. And, then, you forget about Myspace because it's no longer the relevant platform. And, then, you talk to kids, nowadays, you say Facebook. They're like, "What's Facebook? I'm using…" whatever the platform they're using. So there's always a newer platform that's going to come along.  And I think the other thing to remember, too, is ChatGPT, like you said, it's in a beta. It's not even fully out, but yet people are using it like it's fully there. And you have to remember those guardrails and, maybe, we can talk a little bit. How can companies use this within their organization, in a safe way? Because, obviously, you don't want to do too major stuff, but you can also utilize it for helping in some ways, too. Scott:              Well, as previously mentioned, we started saying you got to be careful and we need to educate. The same way we need to educate, "Don't click on that attachment on that email." Because it might open something up that's going to do something and cause a ransomware to be loaded, or whatever it might be. We need to educate and train our folks to say, "Well, how do we properly and effectively use this stuff?" Because you can go off the deep end and can go any direction.  And I mentioned, earlier, that as a professional, you can use this stuff and you can acknowledge, "Okay, wait a minute, this is nonsense, or this is really good." It can augment what you're doing. If you know what you're doing, that's the best use to let it help you do what you do best, and you can ask it those questions. You can complement where you're going. If you're new and you're trying to figure out how to use this stuff, you, again, need to have that back- Mfon:             Yes, to piggyback on that, I think, at this moment, and you have to be careful to say, at this moment, with this March 23rd version of GPT-4. If you're a practitioner, you're using it, it can make you better if you have that skill set. So it has the possibility to make you more efficient. Now, if you're not in the profession. So if you're not an accountant and you're looking to use it to do accounting, it can have the opposite effect. But what is happening, if they continue, with their focus on reliability, that gap is going to get narrower. It's going to get smaller, but it's not going to disappear.  Scott:              And you were asking about effective use of this, as a professional. The idea that you need to understand the field, to be able to ask the right questions. To be an effective learner, you have to be an effective questioner. To be an effective questioner will help you go far in any direction you want. If you're just going to trust blindly, it's not going to be effective for you. Mfon:             And from a business side, we're going to see more companies partnering with OpenAI. So Chegg has partnered with ChatGPT to create CheggMate. Bloomberg has created their Bloomberg GPT. So we'll see more and more of these applications or partnerships, with GPT and other platforms. Again, moving from that infrastructure phase to more of an application phase. Adam:            Yes, there seems to be an infinite waitlist for those who are trying to partner with them. If you try to say, "I want some sort of partnership, I'll work with it."  They say, "Well, we've got you on a list and we'll get back to you when we can." They're not even giving a time period now, which is really interesting. Scott:              Although you hear about the majors-Adam:            The majors, of course. Scott:              You hear about the Metas of the world. You hear about the Alphabets of the world, the Microsofts of the world, the OpenAIs of the world. But there are hundreds of other artificial intelligent applications out there. From music generators, to video generators, to rewriting, and tools, that there's a lot of NVC, there's a lot of venture capital money that's going towards these. It feels like the .com boom. If you were in 1998 and you had the .com in your name, toys.com or china.com, people threw money at you. Now you've got .ai, people are throwing money at you. Some of them are going to stick and some of them are pretty powerful. I've used a variety of these tools, and they're impressive and they can do some amazing things. Adam:            I mean, just thinking of the example of that picture of the Pope, in that white puffy jacket, that went around, and everybody thought was real. And then they're like, "Wait, that was created by AI." And it fooled so many people. News outlets were reporting on it, that it was this great picture. Scott:              That's right. Adam:            So I want to circle back to what you were saying, Scott, about novices and people just learning. And to be a great learner, you have to be a great questioner. And, so, this makes me think about accounting education and people in schools. And I know that ChatGPT had created another tool for professors to use, to check in against plagiarism and stuff like that.                         But how can this be used in an accounting education? Because the people, the kids, that are coming up, they're more tech savvy than folks who are older, and they're going to continue to be more and more savvy. But how can we best use this as we train up the next generation? Scott:              Well, I'll tell you, this is not only changing the world of work, it's also changing the world of education. We need to change as educators. We need to level up. We keep talking about critical thinking. That critical thinking is a powerful environment that we need to help our students take advantage of. But it's even more important now with the use of these AI tools. Because when they ask a question, well, students, and I hate to stereotype any student, but they don't have the bandwidth nor the base of knowledge that the experts and the professionals have. So they're going to take a look at some of this technology and trust it a little more blindly than you or I would, probably, like.  So they are exposed to it, they are using it. I've surveyed three classes recently. One over three quarters were using it. Another about half, a little over a half we're using it. And a third under a quarter we're using it. Which means they're using it. The key is, are faculty using it? Are the educators using it? And when we do, we realize they're going to take home exam and they're going to play with it, look at it, and say, "Oh, great, I get the answer." But I will share, I've done two exams, I call them "You're the auditor exams." And I actually ask a question, multiple choice. I give it the AI answer that ChatGPT generated, and then I give it three alternatives. So this is the new multiple choice format. So what was the result? Randomly, these two exams, it was about 52% that ChatGPT was right. So 20 out of 39 right, 19 out of 39 wrong.  I told my students, "You want to get a 50 on this exam, just circle A for every one of these answers and you're halfway there. But if you want to get a better grade. You're probably going to want to really do the problem, do the question, and evaluate for yourself." But they have access to the post of ChatGPT. We need to embrace that, and use that, and apply that to teach them how the rights and the wrongs, the ethical use of this tool. Mfon:             Definitely it is a challenge because you think about we're training students to go into the workforce. Definitely the workforce wants more efficient and productive workers, and this tool can definitely provide that or facilitate that. So you want to expose students to it because, eventually, the workforce is going to demand it, for greater output. So that's the big challenge. And I think the other challenge educators have been facing, is it's been changing so much. And we're getting a little breather right now, between the 4.0 and the GPT-5. Because you think about it, we had the rollout of the 3.5, then the 3.5 Plus, then the 4.0. And really, there was a big jump between the very first rollout in November 30th, the 3.5, to the 4.0, today, and we have to maneuver and adjust. So we can, at least, set some sort of baseline, right now, to catch up. Adam:            I'm in the field of education, adult education, as well, and it's interesting when I talk to colleagues. I was talking to a colleague of mine and he said, "Well, yes, I was doing a three-day seminar for the internal organization and I used ChatGPT to create my beginning starting point, and then I adjusted it from there."                         So, like you said, Scott, educators need to really jump on this. Because it could be people who are professionals can utilize it to say, "Hey, I'm going to create an outline using ChatGPT if I can put all this material in there." But then if all of us, professionals, start to do that, are we losing the ability to create these things on our own. Scott:              Well, two factors, one is in the career space. Mfon brought a great point on employers are expecting you to have this skill.  Adam:            Yes. Scott:              I saw a survey that over 90% of employers want to see that as a tool you've used, experienced, and have some knowledge of, even more so than blockchain these days. But the other side is being able to apply, and as you were just talking about, the tools, you can use it for so many things. You can use it to summarize; "Here is my LinkedIn URL, give me a summary of who I'm going to be talking to." "Here's an article; I don't have time to read this six pages. Give me a summary of what this is all about." And you can use those things, and it's, usually, pretty good and pretty accurate in reflecting that. And then you say, "Give me the ten-top points, in bullet points." Then go ahead, "I need to write my own blog, and my own post. I need to set up, give me a two-week schedule to implement this program, which is going to include these steps." Or, "First of all, tell me the steps. Then make me a two-week schedule or a 30-day schedule." "I'm on a diet, I'm traveling, give me a tour. How about some restaurants?" Back to the hallucination, though, it gets names wrong. I actually made a list of the 50 CPA associations, across the country. The societies’ CPAs, I said, "Give me the executive director, their email, their address, their phone, and their abbreviation." It got every executive director, or CEO, wrong. It got every email address for those CEOs, obviously, wrong. It made them up. It made up names, but it sounds so good. I looked at it and said, "Oh, this is cool."  And then I realized, "But South Carolina, and Massachusetts, Wisconsin, I know these guys. I've never heard of these people, who the heck are they?" And the same thing for education journal articles. Book titles, it makes up book names, like, "Give me a list of the top 25 books in the career space." If I'm looking for this kind of role. And it gave me 15 or 20 that were actually pretty good and pretty well recognized, and three or four, I said, "I've never heard of these." And the reason was they didn't exist. So you look at that and start saying, "Okay, it's got good stuff, but it's got a balance." Mfon:             Yes, but I think as that reliability and the focus on that on ending that hallucination, as far as the education portion. There's going to be way more value and emphasis on critical thinking and the problem solving skills, and not using that as... So I think it'll shift even more. Scott:              The only constant is change, and you're right about that. Those exams that I told had a roughly 46%, 52%, depending on the exam, was a 3.5. Jumping to 4.0, we're over 80%. So it's improving, too.  I discovered this in December I said, "Okay, I've got an exam, let me play with it and see what it does. The first five out of six questions, it got right. And I said, "Oh, my students are going to cheat like mag dogs, and I can't give a take home exam ever again." But the next six out of seven questions, it got wrong. And then I was more worried because, again, I know how trusting students can be when they look at the logical, the good English, the nice flow, and then get a wrong answer. But they would trust it because of the proper English and the flow. Adam:            So that's a great example of how you can incorporate it into your classroom. Are there other ways you can integrate that or similar tools into the classroom, as you were building this? Scott:              I'm using it daily, in terms of asking a question for the day kind of thing, and that response, I actually, grade it. I discuss it with my students, and then they grade it. And in three different classes, in the same day, once I got a B+ for one, I got a D for another, and I got a CC+ on a third. So I'm an academic, I'll grade them.  Then we show what was wrong, what the shortcomings are. But every time you get a different answer, and it's not always improving. It's not stepping up to say, okay, this first time, I asked it this, next time that, it depends on the word choices. We're going back to the beginning. "Ah, this word sounds good after the next word." And that's the flow.  I once asked it the question, "So when did the dragons defeat the Roman Empire?" And it said, "In 650 BCE, king so and so and the dragons defeated the Roman Empire. But 200 years later, the Romans fought back and were restored to order." Whatever it was. I couldn't get that answer again, by the way. I've been in there since, trying to ask the same or similar question. And it says, "But dragons are mythical creatures, they don't exist." So it does learn, but it also can give you some pretty far-out answers.  Mfon:             Yes, it does, and as educators, we need to expose our students to it, talk about it. We can't really bury our heads in the sand and pretend like, "You know what, this isn't here, it's not coming." They are using it, and it's important to at least understand how they're using it. Understand what type of access they have to it.  Because I survey my students; I have some students who have the free version, and they've tried it a few times. I have other students that have the paid version and they are using it every day, diligently, and they let me know. So it's important to understand that and get a gauge on it, and then dive into it and use it because it's not going away. It is not going to go away. Scott:              And it really starts back at secondary education. I mean, the State of New York has banned it. Can't have it on the Chromebooks, can't access it. The City of Baltimore looking at it saying "No, can't do it." The City of Seattle.  But what's that telling our students? And what's that telling our environment? And what's that going to do for graduates? When the employers are saying, "We want folks with experience, even if they're not college graduates, even high school graduates. We want them to have some experience." So the haves and the have not barrier is going to get wider because students that can't get it on their school computer can go home, "Mom or dad can I use your computer for school?" Who's going to deny them? But the students, I'll call the have nots, that don't have a parent with Internet access or a computer, and are stuck with their school computer, now they can't access it. So what happens at graduation? We have the haves that played with it, used it, even though they banned it. And the have nots that don't have that skill set or level, or they both go to college and, again, there's that still gap coming into college. So our work's cut out for us. But Mfon is so right about not being able to bury our head in the sand. We need to embrace it, use it, apply it, and help our students do the same. Mfon:             And that's a good point, because with more penetration of ChatGPT and other platforms like it, there will be that, I guess, you can call it the AI gap. So you'll start to see there'll be a gap between those who are using it or have exposure to it, and those who do not. Scott:              I'll quote you on that AI gap, for certain. Adam:            I was reading an article, I saw an article yesterday, I think, it was on CNBC or one of those things they got. Somebody was quoting it and linked to it, and it was listing this very large number of organizations, that are starting to look for ChatGPT as experience on resumes even now. And it's not just saying, "I know about ChatGPT." But what can you do with it? And being able to express what you can do with it on your resume, that's a game changer right there. Scott:              There are a lot of HR folks fearing and saying, "Well, if they use it to write a cover letter, how can I tell if they used it?" Well, actually, if they use it, more power to them. They're, actually, applying the technology to something. And then they say, "Well, we can't differentiate." Well, maybe you don't want to because everyone's going to be able to have great cover letters. Now we got to look deep at something different. Maybe content, maybe certifications, maybe the ability to understand and integrate. But that prompt engineering is alive and well, and we really need to embrace that, too. Adam:            So, as we're wrapping up the conversation, as we look to the future. What can we do as practitioners in the space? We've talked a lot about educators. What can we do, as we move forward? And what are some steps we could take as takeaways? Mfon:             I would say the, big one, as a practitioner, get comfortable with being uncomfortable. And you have to have that life-long learning mindset, at this point. And dive in and use the technology as much as you can, and learn as much as you can about it because it's changing, it's growing. You've got ChatGPT, you've got Google's Bard, which is developing. You've got Caktus AI. So you have so many of these various platforms, and they're going to be more and more widely adopted. So understanding how they work, and where they're going, and how they apply to your practice, I think is very important. Scott:              And most of us have been using AI whether we realize it or not. You look at Alexa, you look at Siri, and you look at Netflix, they've been using AI for a while, that means we've been using it for a while. But I, wholeheartedly, agree that we need to embrace it. Because, frankly, our clients and customers are going to be using it. Our staffs are going to be using it. Our kids are going to be using it. Owners need to be using it. We need to get comfortable with it, appreciate it, and take advantage of what it can do, it can magnify. It's just like RPA, Robotic Process Automation, it can take a three-week process and complete it in two hours, cool stuff. But so can AI.  Mfon:             Yes, and if you think about it, if you have a business and your competitor is doing more with less, they can outpace you, potentially. Scott:              And I want to clarify the job challenge. There was a study, out there, that said 85 million jobs will be eliminated, The World Economic Forum, put that out, by 2025. And they said 97 million will be created. To me, that's a net gain of 12 million. And think of the profession 100 years ago, we had 30 accountants for a 100-person company. Then we had ten accountants for a 100-person company. Now we have one and a half or two accountants for a 100-person company. Does that mean we have a bunch of out of work, unemployed accountants? Well, last I heard, there was a shortage. So there really is a need. But it gives an opportunity for accountants to do higher level stuff. To enter the C-suite, to be able to help make decisions and in process.So learn the tools, take advantage of the tools. And, as we said before, it's a springboard for a lot of opportunities. Adam:            It definitely is. And I know we could keep talking about this for a long time. But I'm going to promise our listeners that I'll have these two guys back on, in the future. Because I know, probably, a year from now, six months from now, this conversation will be completely different. And, so, if they're willing, we'll do that. Thank you both for coming on today. It's been a great conversation. Mfon:             Absolutely, thank you for having us. Scott:              It's been an honor. Much appreciated.  Announcer:    This has been Count Me In, IMA's podcast. Providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in, for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

In today's challenging business landscape, organizations need to adapt, innovate, and maximize efficiency more than ever. In today’s episode of Count Me In, we dives into the heart of support functions within organizations, discussing the current markets in 2023 and the inevitable squeeze that many businesses face. Our Guest Kevin Herring, president and founder of Ascent Management Consulting, discusses how you can leverage expertise within your organization as cuts and reorganizations loom on the horizon. Kevin will unpack the role of accountants, finance, IT, HR, engineering, supply chain, and more in optimizing the resources they have in the organization. Discover how you can shift your mindset, change how you operate, and bring your expertise to bear on critical situations.Connect with Kevin:https://ascentmgt.com/https://www.linkedin.com/in/the90dayturnaround/Full Episode Transcript:Adam:            Welcome to another episode of Count Me In. Today's world is filled with uncertainty, and with 2023 looking like a challenging year, organizations are feeling the squeeze. Our guest, today, Kevin Herring, president and founder of Ascent Management Consulting. Brings a wealth of knowledge and expertise to our discussion, on support functions within organizations.  We'll explore how businesses can optimize their existing resources, transform their thinking, and redefine roles to survive and thrive in these turbulent times. It's time to reimagine your organization's potential. So let's dive right into this essential conversation. Kevin, I want to thank you so much for coming on the Count Me In podcast. I'm really excited to have you on. As we talk about support functions within organizations. And as we both know that the markets, in 2023, are not looking great. The futures are not looking great. And it's going to put a squeeze on many organizations. And can we start talking about, within organizations. How you can leverage expertise, within your organization, as cuts and reorganizations are going to have to start coming? Kevin:            Yes, that's a great question. How do we do that? And I think that you're right. Everything that we read, everything that we hear CEOs are saying that they're hunkering down. They're planning for a rough 2023, possibly 2024, and they really have to maximize, maybe, a better way to put it is to optimize the resources that they have in the organization to get through it. And our support functions play a critical role in that.  Every organization has a lot of natural slack in the system. And, sometimes, we don't realize it until we really start to drill down and look at what's working, what's not working, that sort of thing. And what we find is that when you talk to people, when you talk to teams, and ask them, are they contributing everything that they could possibly contribute to the organization?  Not are they working as hard as they can, but are they contributing everything? Do they have capabilities that are not being used? Do they have information, understandings of things that are not being tapped? And the answer is almost always, "Absolutely, yes. I'm doing the best I can with what I have, but I could do so much more for the organization, if they just let me." And people and staff functions play such a critical role. Accountants, finance folks, IT, HR, engineering, supply chain, all those functions can play a huge role in maximizing or optimizing the use of our resources. The people that actually produce the product. The people that actually interface with the customers directly. And one of the ways they can do that is really to take a different look, maybe, than they have, historically, about their role in the organization.  So here are a couple of ways to do that. One is to think, when I go to work each day, how do I see myself? And this is not just a semantic exercise. But do I see myself as an accountant who just happens to work at XYZ manufacturing company, for instance? Or do I see myself as an XYZ business person, who happens to bring accounting expertise to the organization? And it's a different way of thinking about my role, "Why I'm here?""What am I supposed to do in this organization?" Am I just supposed to perform a bunch of tasks related to accounting? Or am I actually supposed to do things that, sometimes, might even stretch me a bit outside of my area of expertise. To help the business, overall, to be successful and to look for those opportunities?  And, so, when we do that, we start recognizing that for an organization to get the full use of our expertise. We need to think of ourselves in terms of how can we bring our expertise to bear on the critical situations that the organization is dealing with. The critical issues they're dealing with, "How do I do that?". And that's a consulting role, that's not an activity role. That's not a compliance or regulatory role, that's a consulting role.  That's where we're looking for ways that we can help those who are in the core business. To produce more efficiently, more effectively, to satisfy the customer better. To produce better products, higher quality, optimized, profitability, reducing cycle time, all those sorts of things, delighting the customer. Those are all things that anyone in a support function has the ability to help with. If they think of ways to apply their expertise in solving existing problems, and preparing the organization to handle possible future issues.  So that's a shift in thinking, it's also a change in how we operate. Because now, if I'm a consultant, I need to learn how to be a consultant. I need to learn consulting skills. I need to learn how to identify opportunities, diagnose problems, gather data, assess it, and determine how I can solve that problem. Or determine if maybe I don't have the expertise to solve it. Who might have that expertise, and be willing to source that for those in the core business that are struggling. That's a different role, for a lot of people. Adam:            That is a different role. And it's almost like within your internal organization, your title may be Chief Financial Officer or Chief Staff Accountant. But what you're saying is that your mindset needs to be that of a consultant, to better help the organization. So how do you start changing that mindset so that you can better help? Kevin:            Yes, well, first you have to decide who your client is. And this is a problem for a lot of people. Most people, when you ask them, "Who's your client?" They point to their boss. That's the client or the boss's boss, the CEO or the CFO. That's who they really serve in the organization, and that's not an effective mindset to have. Sure, those people play a critical role, but as bankers, really as bankers. People who provide the assets, the resources, the budgets, the tools and supplies, and things you need to be able to take your expertise and apply it to the core business. They want a return on those assets. So they're going to extend the resources for you to be able to use them in a productive way, for the organization.  And, so, that begs the question — Who is the real client? Well, the places where you can have the biggest impact are in production, or in those who are interfacing with the customer, or closest to the core work. That's really where the biggest impact can be had.  And, so, if we see those folks as the clients, and then we learn to interface differently and we interact with them. We are always in the mode of gathering data, gathering information, and trying to look for opportunities to help them. Quite often, when things get tough, we focus on cost.  We think, "Well, how can we reduce costs?" And it's all about squeezing the bottom line instead of really focusing on profitability, not that they're not related. But, ultimately, how can we invest our time, our existing resources, in a better way to get a better return on our assets? And, so, people with financial expertise go into an organization and, sometimes, it's very easy to see waste, and redundancy, and opportunities to help people work better, more effectively, and make better business decisions.  And one of the classic ways is when accountants and finance people go into an organization, and they start building the business literacy of the people who work there. So that they can make better decisions. Not just the leadership, I mean, that's certainly a place to start.  But once the leadership has the big picture, what about all the people who are executing in the front lines? If they don't have the big picture, they're making mistakes all the time. They're operating in a vacuum, and they're doing the best they can with what they have.  But often they have so little, they make a lot of bad decisions. Or they're not given the resources to be able to act in the moment to solve a problem, and the delays are costing the business a lot of money. So there are lots of opportunities for our support functions to go in and make a huge impact on the business, in the next couple of years. Adam:            Now there's one thing I wanted to touch on a little bit, as you talked about the real internal client. Now that's something that I think a lot of people overlook. As many times we're always thinking, "Oh, how can I please my boss?" And looking at your boss as like the banker.  The person who gives you all the resources you need, is something that I don't think many people speak about. How can leadership help the constituents under them understand, "Hey, I'm not your client. Your client is our customer base is whoever we're looking at." How can they help them get that big picture in their head? Kevin:            Yes, one way they can do that is to simply have the conversation. Sit down and talk, frankly, about what that role is, what that relationship is. As a banker, if I'm extending assets to you to do something for the company. I'm expecting some kind of return on those assets. So there may be some promises that we have about how you're going to use what I give you in the organization. What you're going to do for us. How are you going to help the organization realize a benefit from these assets that I'm extending to you, as the banker? And that's a great conversation to have.  And, sometimes, you're not able to have that conversation until folks go out into the core business and start learning what goes on closer to the customer, and the production areas, and see where some of the opportunities are. And, then, they see how they can apply their expertise more effectively. And, then, they can come back to the banker and say, "I think I understand now what I can do for the organization." So when I look at the resources you're giving me. Here's what I need, more or less or whatever, here's what I need to be able to help these people improve their performance." Or whatever it is. So I make a promise, if you extend this amount of money to me to do, for instance, a business literacy program in the business.  I'm confident that we can now help people make better decisions down on the front lines. That will have a profound impact on our ability to produce with higher quality, and lower cycle times, and so on, and that's all going to go to the bottom line.  So what is it that I need? I'll make a commitment to you, to make that much of an improvement if you'll give me the resources to do it. And, likewise, it's the same thing, if I'm meeting with a client. So I've been doing consulting for a lot of years. But I was in house for many years before that. And that's when this new idea developed, and started to have some conversations about what my role was inside the organization to those who we defined as my clients. And I recognized that I need to have conversations with my clients about what I can do for them. And work things out with them so that they give me what I need to be able to help them.  There may be some things I need, some resources. There may be some information, access to data, whatever it is. And if I ask you, as my client, if you'll give me those things, I'll come back with a plan that will help you with your business. So let's work out those arrangements so that we know what I'm promising to you. And what you need to give me for me to fulfill that promise to you.  Adam:            Yes, as I'm thinking about this, employees are going to feel the competitive pressure. As you mentioned, CEOs are feeling the squeeze. They're going to have to tight squeeze. I'm sure we've all read about the beginning of 2023, with what happened at Goldman Sachs. What can employees do, as they need to capitalize on these competitive things and be able to stay on top of things? You've mentioned, a lot of that stuff. But I feel like there's more that they're going to need to capitalize on, as the pressure continues to rise with the market way it is. Kevin:            Absolutely, and part of that is that education. That business literacy process, understanding the big picture. And as a person on the front lines, it's helpful for me to understand what business we're in. What the competitive pressures are. How do we stack up against the competition? And are we a big player, are we a small player? What are our strategic advantages and what are our disadvantages? What do we have to overcome to be better competitors?  I mean, all those things are important, for me, to understand. Because when I do my work each day, hopefully, I'm contributing by looking for ways to improve our competitive position. I'm looking for ways that we can do things more efficiently, more effectively. We can streamline, we can cut out redundancies. We can find a breakthrough in being better able to serve the customer or deliver faster, and that sort of thing.  We need to get our core employees to work on building the business and helping the business prepare for tough times, and to help us to survive in it. And we're not going to do that if we think all the great ideas and all the great work is going to come from the leadership.It's just not going to happen. We need a strong, cohesive, interdependent, team of people all pulling together and looking for ways to work together to make these things happen. And our leaders, our front line leaders, our support functions, all play a critical role in making that happen. So that people have that orientation, and the orientation of serving each other.  You talked about competing, we're going to be competing in a tough market, we figure, in the next couple of years. Well, if it's going to get tough, where do we want competition to be? Do we want it to be inside the organization or do we want it to be us against other providers of these goods and services?  So let's stop competing internally for resources and let's start finding ways to serve each other. So that we optimize the resources we have and use them to their fullest. So that we're able to better compete, against those who we truly need to be competing against. How many organizations are operating where people are fighting, having turf battles, and fighting over office space, or the copy machine, or the forklift, or whatever it is that we're fighting over. And, sometimes, even undermining each other for our own convenience? I mean, how much does that cost the business? I mean, it's huge, it's absolutely huge. And, so, we have to stop doing that. We have to create a culture of commitment to the success of the whole. Adam:            Mh-hmm, and that's got to be really hard. When certain places there's that fight to get to the top, as opposed to let's help each other get to the top. And, I think, a lot of businesses don't have that atmosphere, but we need to help each other in order to succeed. Kevin:            Right, that helps take all the egos out. And just say, "Look, we all play different roles. We have different sets of responsibilities." But when it comes down to it, we all need to choose accountability for the success of the whole business if we're going to make this work. And if we don't, we're undermining our ability to successfully compete in the near term, for sure, probably, in the long term. Adam:            So when you're looking at creating that cohesive team. I think that word you just used, accountability is the key thing. How do you create that real accountability and what does that look like? Kevin:            Yes, so often we talk about holding people accountable. We say if we need to get better performance, more results, we need to hold people more accountable. We need to get things more into control. And what that, generally, does is it creates an environment of micromanagement and compliance responses from employees. And I like to say it's pretty hard to really hold people accountable, in the sense that we hold them accountable and still enable them to be responsible. Because the minute we start taking charge of something.  We tell somebody, "I can't trust you to get the work done. So I'm going to check up on you. I'm going to follow up with you. I'm going to make sure you get it done." The minute that we do that, we've taken responsibility for it. We've taken it away from the individual. Now they're just a pair of hands doing what we tell them to do. And we've taken away their sense of responsibility and commitment, and they're operating out of a sense of a, need to comply to keep their jobs.  And there's a huge difference in performance between those who are operating just to comply and keep their jobs. Versus those who are, intrinsically, motivated and openly choosing their own accountability to their teams, to their coworkers, to their leaders, and the organization, overall. So it's important for accountability to be shaped the right way. To where we orient people to the big picture.  Here's what we all need to accomplish as a business. Here's how our team fits into that. Here's how our team interfaces with other teams, to help us produce whatever it is we produce or deliver to the customer.  And then inside of our team, let's make sure we're clear about what each person does and how it impacts everybody else on the team. And make some commitments to each other about how we're going to work. So that the team can work effectively, and find ways to improve the way that we get the workout. And then the next phase of that, then, is to take that team and say, "Okay, how do we now help those around us to do what they need to do?" We're interfacing with these other teams in the organization. They have work they need to produce. What can we do to serve them and help them, so that they can do what they need to do? It's the same mentality we have to have with our customers. What am I delivering to my customer? It's satisfying a need.  My customer is trying to do something, they want something. So how do I help them get what they need, that satisfies them by their standard, not by mine. Internally, we have to do the same thing. As employees, working together as teams, interfacing with each other, it has to be the same mentality. Adam:            Yes, it really does. And one thing that I'm thinking about, as we talk about making sure that everybody sees the big picture. A lot of times it's hard to apply the big picture. If, let's say, you're a front line worker and you have a lot of activities you're doing, every single day. It's very hard to understand those activities, as becoming results to help the overall organization. To help the big picture. How do you bridge that gap? Kevin:            I had a group of people I was working with, a finance group, and we were doing this in the organization. Trying to increase individual understanding of the overall business. And I remember the finance manager saying, "Yes, we did this in another company and we decided that everybody, to a certain level, needed to have the big picture. Those who are like janitorial staff and other people, they didn't need to know, they didn't care. They weren't going to have an impact.  And I said, "Wait a minute, you can't pick and choose who is going to make the most impact, in any given moment in time." Everybody makes a contribution and otherwise we wouldn't be paying for it. We're investing in people to do things that help us get done what we need to do for the customer. So everybody needs to understand the big picture, to make the right decisions.  And, so, even if you're looking at the janitor makes decisions about how efficiently they use chemicals, for instance. Or how efficiently they do the work, and what they do to provide the environment such that it's ready for people to work, and perform, and that sort of thing. I mean, whatever it is they do they can do it well, and they can have a sense of satisfaction that they're contributing to the whole. Everybody needs to be part of that, you can't exclude people. It's one organization, not a two-tiered system where you have the primary class and the secondary class, that doesn't work. Adam:            Yes, it's hard because our society looks at people that way. And you have to break that down when you get into an organization. Kevin:            Yes. And, so, one of the things that works really well is to bring people together. I always find that when you bring a team together. And you say, "Okay, let's educate each other. Let's talk about what each does in the organization." And a lot of times people say, "Well, that's obvious, we know what each other does."  And I say, "No, everybody take just two or three minutes, highlight, here's what I do for, not the tasks I perform. Here's what I actually do in terms of output for the organization. Here's what I accomplish. Here are the things that get in the way of that the most, that make my job difficult."  And as people understand that the light bulbs start turning on. They go, "Oh, I could probably help you with that."  "I could probably help you with that." And pretty soon they start talking about ways they can serve each other. And if we get them into that mindset in that activity, they start making commitments to each other. About how they're going to help each other in the coming months. And, then, we do follow-up conversations and give each other feedback.  We can start talking about how we're doing, how much better we're doing, and where we still need work. And, then, we can start talking about opportunities to create breakthroughs, as we start looking at the overall systems that we operate in, and identify the ones that are making our work the most difficult.  And we identify where we might be able to streamline something, or reduce steps, or simplify, or whatever. Do things concurrently, instead of doing one, and then waiting for the next, and waiting for the next. There are a lot of things that we can do. Once we get people having the education, it's called the business education, to understand the work that they're in and how it matters.  I use the example a lot, in sports, you look at sports players, football, for instance, since we're in Super Bowl season. Everybody, on a sports team, is well aware of the competition and their competitive position. The advantages and disadvantages each team has. Their strengths and weaknesses. They know every player. There are statistics all over the place, about what people are good at and what they're not so good at. And they use that information to create a game plan to defeat the other team.  And, then, during the game, there are all kinds of indicators that tell us how we're doing. So that we can make adjustments and look for ways to create a breakthrough in the game, if we're behind or struggling. And we don't do that very well in business. But Sports is a business, just as much as any other organization, for-profit organization. We're all in it to make money and be able to meet the needs of the customer. So that we have the ability to remain viable in the marketplace.  So if we apply those same principles at work. We find that we need to educate people about the game plan. We need to help them understand what the competition is. What's at stake each day, each month, each quarter, and what are the things that we need to accomplish. And then how are we, at a tactical level, going to contribute so that we can succeed? Adam:            Yes. Kevin:            Those are important conversations to have, and they're not often had in organizations. Especially traditional organizations, where at the top of the organization pyramid; all the knowledge, all the understanding of the big picture, the departments. How the systems, in the organization, work together to produce the product, and satisfy the customer, all those kinds of things. The authority to make decisions. They all tend to reside at the top, and then get delegated to lesser and lesser degrees down through the organization.  So by the time you get to the people on the front lines, doing the work. Who have information, by the way, that nobody else has because they're doing the core work. They're interfacing with the customer. And they have to make decisions in the moment, all the time, that have a huge impact on the business. And, yet, they're the least knowledgeable about the overall organization, the impact their decisions are having.  And, so, they have to make those decisions in a vacuum. And, quite often, they don't have permission to make a lot of decisions. And, so, the decisions don't get made at all. So that's by default, whatever happens, happens. Or there are huge delays while they try to get permission to do something. Or they feed information up the line, and hope somebody somewhere does something about it. That's costing businesses an incredible amount of money. Which is why when we work with people, they're astounded when they get a 50% improvement in performance from a team.  How is that possible? Is it because there's so much slack in the system and you just don't see. But when you find that people are working differently, more effectively together, the results are astounding. Adam:            Yes, that is so true. So this has been a wonderful conversation, Kevin, and I just wanted to ask one last question. In light of the squeeze that is coming with the market, and restructuring of organizations that are coming. What advice would you give to somebody on the other side of a restructuring? And you're still at the organization, and suddenly you have the responsibility of three people now because two other people were let go. What advice would you give to that person, as you're trying to look in things, in the aftermath of that. Kevin:            Well, the first thing I would do is I'd pull my team together and I'd say, "Okay, let's regroup. We've all been through a lot. There's a lot of emotion that we're experiencing. Loss of teammates, increased workload, increased expectations. It's a tough spot to be in." And to be authentic about it, not to paint a rosy picture of everything, and spin the message, and pretend like everything is great. And nobody has experienced anything challenging, recently.  But to be authentic about it and say, "Look, we've gone through some tough times. That's a lot of turmoil to deal with. And I know that you're, probably, feeling a lot like I am about it. You have an empty feeling, maybe, about the people who are gone. You feel concerned for them. You have a little bit of anxiety about our own future, and how things are going to work out for us.  This is all natural, and I'm not immune from it any more than you are. I mean, we all have to deal with those things. And the reality is we have to figure out how to make things work going forward, so this doesn't happen again.  We need to really figure out how we can produce, at a higher level. And not, necessarily, pushing ourselves to work crazy fast or ridiculous numbers of hours. But we have to think smart, so let's pull together.  Let's analyze the work that we do. Let's look at the processes and the systems that we're dealing with. Let's map some of those and let's identify what kinds of things are getting in the way, and let's see if we can't tackle those and create a breakthrough. Either in profitability cycle time, customer response, or quality of product or service. Let's go through and figure out where we can create a breakthrough in the work that we do. So that we can have a positive contribution to the business, to help us be more competitive.  Because the marketplace is unforgiving and they've just spanked us, and we don't want that to happen again. We want to be competitors in that marketplace. And if we're smart about it, this is an asset that we have that we can leverage, is our way of working together that can push us ahead of our competition. And we can, actually, maybe benefit from this difficulty because maybe we can pull ahead of them. Because we've done some smart things in the face of these challenges." That's what I do.  I think people need to just pull together and face the reality of what's happened, and the challenges associated with it, and all that it does to us internally. And to say, "Okay, what are we going to choose to do now going forward?" And that's what a leader does. A leader says, "Look, I'm no different than you. I'm not going to be phony about it. I'm going to tell the truth; this is stressful for me. And I'm going to choose to do the best I can for us to be competitive. And I'm inviting you to work with me for us to all to work together, and do this as a team." Adam:            Yes, I agree. And I think a lot of people are going to need to hear that, as we go forward. Thank you so much, Kevin, for coming on the podcast today. Really appreciate you sharing your expertise with us. Kevin:            Thanks for having me.Announcer:    This has been Count Me In. IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in, for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

In this riveting episode of the Count Me In Podcast, we dive into the complex world of cybersecurity within the accounting profession. Join us as we sit down with Tom Woolley, CEO of Today CFO and Founder of  Today Cybersecurity, who has navigated the transitions from corporate industry to founding his own cloud accounting firm, and then into cybersecurity for accountants. Discover the biggest challenges faced by organizations today, from integration headaches to the buffet of software solutions. Whether you are a Fortune 100 company or a mom-and-pop shop, you'll gain insights into striking the right balance with technology to ensure information security. With regulations tightening, get ahead of the curve with expert advice and real-world solutions. Don't miss out on this episode – tune in now!Connect with Tom:* Website: www.todaycybersecurity.com * Tom's LinkedIn: https://www.linkedin.com/in/tom-w-2b6256173/ * Facebook: https://www.facebook.com/todaycyber * Twitter: https://twitter.com/todaycyber_ * Instagram: https://www.instagram.com/todaycybersecurity/ * LinkedIn: https://www.linkedin.com/company/today-cybersecurity/Full Episode Transcript:Adam:    Welcome to another enlightening episode of Count Me In. Today we have an exceptionally exciting conversation lined up for you. Our guest today is my fellow podcaster, and an author on Amazon's bestseller list, Tom Wooley. He has expertise in corporate accounting. Spanning sectors like pharmaceuticals, oil, and gas, and now he's making waves in the realm of cybersecurity.  From big corporations to small businesses, the tech landscape is ever-changing, and Tom's insights are here to guide us through it. We'll discuss; The rapid shift to remote work.  The challenges of secure information handling.  The complexities of selecting the right software.  And the impact of new regulations.   Buckle up, as we explore how technology is shaping the future of accounting. Tom, welcome to the show. Adam:            To start off, I just really wanted to, maybe, you can talk a little bit about your background and how you got here. Tom:               Hi, Adam, thanks so much. It's a pleasure to be here. So I've been an accountant for 15 years, in the corporate industry before starting my own firm. I started off in pharmaceuticals, and then went to oil and gas in more of the financial analysis role and a lot of management accountancy. One of the things I used to do a lot of was whenever we would acquire a new company, we had to look at their financial systems. What they had in place, and then integrate them into our SAP financial system. All their historicals, and then get them trained, up and running for the future. So I got a lot of experience, and had a lot of fun working in accounting technology in my corporate career. And then decided that, "Hey, there's a lot of technology to be brought or to be moved over and implemented in the small business accounting world as well. Smaller firms need just as much tech, if not more, sometimes, than the big guys. And with the way the technology world is moving, especially, with everything going over to the cloud. I decided to start my own cloud accounting firm, back in 2015. And, then, when everybody started going remote, in 2020, I decided that was a good time to pivot again and go into cybersecurity, for accountants. And help other people tackle some of those issues that we saw as we transitioned to a lot of people working from home, remote, and just coping with a very wild and flexible world, over the last couple of years. Adam:            Yes, it's been a very wild and flexible world. There's been so many things happening with everybody working from home, and all the challenges that organizations face. And cybersecurity is something that's in the news every day. You see ransomware attacks, and so many different things that's affecting so many organizations. Maybe we can start by talking a little bit about what are some of the biggest challenges you see organizations facing, when it comes to cybersecurity. Tom:               Absolutely, there are a couple of things that really hit home. It's how to keep everybody working in a fluid environment. Where you can access all of your information securely. How can you find your clients' information securely? How can you receive it from them securely? We work in a time where we've got so many different communication channels. We have to actually tell our clients what is a safe and good way to get your information over to us.  And when we started transitioning from working in the office to working from home, the biggest challenge that we faced, and that other accountants are facing is–how do you go mobile with all of that? How do you keep it in the cloud and know that it's secure? And, really, importantly, how do we instill that trust relationship with our clients. So that they know that their information is in good hands? And we started looking at so many different software out there.  The second challenge is with a huge buffet of cloud software. Which one goes with which? How does it integrate? And it really came down to what does the process look like, for internally and externally with our clients? And that's what we hear a lot; is which software should I use?  How do I implement it?  There are some all-in-ones out there. Should I piecemeal, together, best in class? And there are just so many solutions. Accountants don't have time for that, especially, during tax season, which has been basically year-round for the last couple of years. Adam:            Yes, I can only imagine. And also the biggest challenge, too, is if you're a Fortune 100 company, you have a lot more financial ability to get a larger software. A big all-in-one software. But if you're a smaller organization, or a Mom-and-pop shop, it's a lot harder to implement those bigger softwares. And, so, trying to find that challenge; how do you balance that depending on which organization you're with? Tom:               Yes, that's a great question. There are smaller softwares like QuickBooks Online and Dropbox, that people, typically, use when they're starting off. All the way up to SAP or NetSuite when they're the Fortune 100. So it really comes down to what is the budget and how customizable does it need to be. Something like NetSuite requires not just getting the software, but hundreds or thousands of hours of customization, and implementation, and training. And what we really want to go for is finding out how the firm is interacting internally, and with their clients. Do they really need something that's super integrated and very expensive? Or can we put together those best practices to make something like OneDrive, Windows, QuickBooks Online, or QuickBooks Desktop, in a hosted environment, work in the same effectiveness as those bigger softwares? Adam:            Yes, there are so many different factors. You almost need a team of people to understand what your organization is doing. What your challenges are, and how you're going to be interacting with the different things to know what, if I'm understanding you correct, it's to know what software works best for you. Tom:               Right, I mean, that's the best way to go about it. And that's what I recommend is putting together a committee. Somebody that represents from each department, what their needs are when it comes to implementing a security software, and how they are moving information on a daily basis. One solution for marketing may not be a winning solution for accountants, who are trying to move PDFs every day back and forth to their clients.  So, yes, representing in that committee is a great way to go about seeing what the use case is, what the needs are. And, then, finding the right software solution in, like I said, that sea of what is out there and what they're all capable of. Adam:            Mh-hmm, and then once you actually find a solution. You still need to tap into that committee to say, "Hey, is this actually meeting your needs and is it working right?" Tom:               Absolutely. It's an ongoing commitment to working with those groups, and making sure that implementation goes according to plan. And things change along the way, sometimes, too. So that really helps give a sounding board for, "Hey, this isn't working the way we need it to." Or, "Yes, we're getting good feedback from the rest of the people in the department." And, hopefully, a few trial clients that have opted in to participate, too. Adam:            Yes, because you need, actually, that real-world experience, to see if it's actually working, of course. Tom:               Exactly. Adam:            I think one of the biggest challenges, when it comes to the accounting and finance team, is that working with other parts of the organization can be difficult. Whether it's working with the marketing department, making sure things are meshing together.  How have you, maybe, helped organizations that you worked with, and you're helping them choose files or choose software to use? Have you found that as a challenge, when you're trying to help implement things that they have trouble working with other departments? Or are they coming together, since we're all kind of breaking down those walls, since we're all remote in a lot of ways, too? Tom:               I think it's going a lot more granular than that these days. I would have said, six to seven years ago, an all-in-one integration, everybody using the same platform is the way to go. But what we're really seeing is that there are departments out there that really want to work within their specialties. I mean, marketing, wants to work in Salesforce.  Adam:            Of course. Tom:               The accounting department is not going to want to work in Salesforce, it's not the right place for them. So, really, cybersecurity has become top of mind and top of conversation so much, because as we're trying to move into best in class solutions for different departments and scenarios. Moving that data, safely, has become a real concern. If everybody is working in NetSuite or SAP, or something fully integrated, you don't have to worry about it as much. But when we're looking for the best solution to help people do their jobs, in a rapidly changing, very competitive environment. We want to give them the best software that they can get their hands on, than what they're used to using.  And, so, that's when the technology industry has to step in, and find a way to make that work where it's still secure for everybody. Where they can work from home on their laptop, if they need to. They can have that exact same functionality at their desktop in the office. Where they've got the printers, and the scanners, and the other things that we need to do our jobs, and phone systems, even, too.  A lot of people don't think about the vulnerability on the phone systems. But I want to make calls from my house just as easily as I'm doing it from the office. And I don't want the clients to know if they've got to try me at the office or try me at home. So everything's got to be flexible, and it's got to be seamless internally and externally. Adam:            Yes, and that's not an easy task to do for any organization. Whether you have a one-and-done system or you're piecemealing everything together. It's quite the challenge for any organization. And as I'm thinking about of all this, I know that there's a lot of rules and regulations throughout the government. I know the U.S. government; we had talked about the FTC Safeguard Rule. Maybe we can touch on how that's affecting people's decisions, as they're going down the line. Tom:               Yes, so the U.S. government is really moving in that direction and solidifying a lot of these rules/regulations. To address what has become insurance company concerns, client concerns, and concerns voiced by the Big Four, about how people's data is being secured and moving around. And a lot of large companies have had security challenges, recently, like Deloitte. Where their best efforts are going forward to protecting their clients, and it's a big investment both in time and financially.  So the government's really moving with these FTC Safeguards Rules. The IRS already has the Gramm-Leach-Bliley Act that has been in place for a while now. So we're looking at, both, the enforcement of already existing rules, that are starting to clamp down. And then we're looking at the FTC Safeguard Rule, that was supposed to be implemented already, but they pushed it back. And these rules apply to businesses of all sizes, which is the really important factor here.  Because in the past, a one to two-person CPA shop may not have to worry about a lot of these regulations and the costs that go along with them. But now it's everybody from that one-person show, all the way up to the Fortune 100, like you were saying. So the government is really stepping in and emphasizing how important it is, for people's information to be secure. What they call personally identifiable information. Adam:            Okay, so what does that look like for your accounting Mom-and-pop shop, whether they're a fractional CFO office, or they're an internal accounting team. What does that look like for them, as they're trying to adhere to these new regulations?Tom:               Yes, it's a challenge because a cybersecurity person is not cheap, from a financial standpoint, it is an investment to go out and get somebody. Somebody that, right now, the demand is already really high for. Salaries are going anywhere between 120 and 160, if you can even find somebody.  Adam:            Wow.  Tom:               Anyone, right now, looking at staffing an accounting firm, is very familiar with how difficult it is to get good people. And we're looking at that same thing, right now, in the IT industry, especially, with cybersecurity, because the demand is just so high. So outsourcing is really their only solution right now. Because it's not as easy as a virus scanner or malware, where you can just toss it on the computer and leave it there.  The FTC safeguards goes above and beyond; into employee training, active threat hunting, and putting Written Information, Security Policy, what they call a WISP, in place. So, for smaller companies, it's a big time and training burden, that really is slipping in there, commitment-wise, with your continuing education every year. Adam:            Mhm, and, so, that's an added burden because as accountants we, like IMA has the CMA certification, if you're a CPA. Everybody knows, if you're in this industry, you need to keep your continuing education credits up. And now, all of a sudden, accountants have to be at least versed in, when it comes to cybersecurity, they need to learn technology. Some people are saying, "Oh, you need to do data analytics." Like, "Oh, you need to have data scientists." There are all these different things that accountants have to do. How can they stay up to date with these things? Obviously, outsourcing that, but what level of understanding do accountants need to have, in order to be at their best to do this? Obviously, they won't be able to be a cybersecurity expert. But what level do you think they need to be at, to best support their organization? Tom:               Yes, I think specialty training is the way to go with this. It's something that we can do on a one to two-day basis, a couple of times. I like to do it with my clients quarterly. Just to let them know what the new ransomware attacks we are looking at, if we've got any vulnerabilities, and it helps us build what we call a cybersecurity culture. Where we're talking about not just training in a one-and-done fashion, but building that mentality, like you were talking about, with y'all skills programs. Where internally we're focusing on ongoing education. Watching for those red flags, in case our computer is doing something weird or we're getting any emails that are suspicious. So these smaller continuing education-type courses, are really the way to go with stuff like that. Adam:            That makes sense, and it seems like, as organizations, we need to keep training our people. To make sure, "Hey, this is what you look for." I know our organization does a yearly cybersecurity training. Where it's like, "Hey, a reminder, look out for these things, look out for those things. If you get an email from the CEO saying, 'Hey, what's our routing account number and account number for our bank account, again?'" Don't do it.Tom:               Right. The real popular one right now, is a text message or an email from an executive level or someone's supervisor saying, "Hey, I'm in a meeting, I need you to get me iTunes gift cards or some other gift cards for the people here in the meeting, as a marketing. Go get them right now." And it sounds silly right now, but it's happening. I mean, people are falling victim to that every day, it's crazy because it's a numbers game. So you just got to find somebody in the right place, at the right time. Adam:            For sure. And, so, we've talked a lot about organizations, and training, and stuff like that. What can we do personally, on a personal level? Everybody has their own personal accounts. Are there things we all should be looking out for, and being aware of just to protect our own data? Just the other day, I logged into an organization, I forget what institution I logged into. And it was like, "Oh, by the way, we were hacked, but none of your account information has gone out. But your name and email address might be on a list somewhere." And I'm like, "Should I be worried?" Tom:               I'm really glad you asked. Because identity theft is really where a lot of this goes, and I think about it all the time. And I can tell you, personally, I recommend when your computer at home and any other personal device that you've got, always do their most recent updates. A lot of people will hit Not Now, Update Later. But I promise you, they don't make you download and reboot unless it's something pretty critical.  So always do your updates, and don't give anything out over email that you wouldn't tell somebody that they could hold for later. So don't ever send your personal information via email, even if it's in a password-protected PDF, those are not secure. You really want to have it sent through either voice or an encrypted uploader, whenever you're moving that kind of stuff around.  And the other thing is, always keep your virus scanner and your malware scanner updated. A lot of people don't, or they turn it off out of convenience. And, then, the number one thing that I will end on, that everyone is going to hate because even I don't like it. But it really works, is the multi-factor authentication. Adam:            Yes. Tom:               The dreaded—Please send me a text message code or pull the code out of your email, or these authenticator apps that we use, I use Google's, it works really well. It works. I cannot tell you how many times I've gotten a random code in my email, going, "I don't know what that was for or who requested it, but I'm glad it is there." Adam:            Exactly. Tom:               Because even that little one, even if it takes you two minutes, to use the multi-factor authentication. I can promise you it is way better than having to cancel all of your credit cards, file a police report, undo any kind of identity theft. Because it is not a friendly process when we have to go through that. It's very invasive and it is not fun. Adam:            Yes, that doesn't sound like fun at all. And, I agree, multi-factor authentication is annoying, but I think it's very essential. Microsoft has an app, too, I use theirs. But anytime I can set it up, I try to turn it on because I've gotten the same thing that you've gotten. Where I've gotten a text message and I'm like, "Well, I didn't try to log in there."                         So I quickly go and change my password and go update those things. And I think it's important to be vigilant about your own personal things, and the more vigilant we are about our personal, it'll help us understand how vigilant we need to be at a corporate level, as well. Tom:               Yes, that's one of my advantages, of going from owning an accounting firm to owning a cybersecurity firm, that works with accountants, is I know the pushback, personally, that I'm going to get from my team when I implement stuff. So when we look at implementing any cybersecurity, we look at; is it necessary and effective enough to warrant the frustration it's going to cause for our employees. And can we make it work as well and seamlessly as possible?  Because I know, from personal experience, if it doesn't work or if it's too complicated, people are going to bypass it. And, so, you might as well not have frustrated them with it at all. And I don't lie to people and say that multi-factor is not a big deal, "It's no problem, just put it in there." It's a pain. People don't like it. There's a lot of pushback with employees and executives, whenever we go to implement this. And I always drink my own Kool-Aid, so I know I don't tell anybody, "This is going to be completely frustration free." I tell them, "It's absolutely necessary, but it's only the level of necessary that we need to stay safe." Adam:            Yes, sometimes, inconveniences help us stay safe, and I think it's balancing that. And I like what you said, is it worth the people's headache to help us keep us safe and trying to balance that, especially, in making those choices as an organization. Tom:               Exactly. Adam:            Yes. Well, Tom, it's been really great talking with you, getting to know you, and I really appreciate the expertise that you share with our audience, today. I know that they're going to find it beneficial as they're going on their journey, and their organization, and personally as well. Adam:            Thanks, Adam, the pleasure has been all mine. I hope your audience and your listeners, really, get something out of this. I hope it was helpful. Announcer:    This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in, for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Unlock the mystifying world of cryptocurrencies and blockchain in this enlightening episode of Count Me In. Join our guest host Kelly Richmond Pope, accounting Professor and author, as she speaks with Lamont Black, an Associate Professor of Finance at DePaul University.  They navigate us through the complexities of blockchain technology, its relevance to accounting and financial services, and the turbulent landscape of cryptocurrency exchanges. Lamont takes a deep dive into how blockchain serves as the foundation of cryptocurrencies, elaborates on its inherent security and transparency, and paints a picture of its significant role in the future of digital commerce. We will also unpack the rise and fall of crypto prices, the risks involved, and how to safely engage with cryptocurrency exchanges. No matter whether you're a finance professional grappling with the challenges of a rapidly digitizing economy, or a curious listener wanting to unravel the world of cryptocurrency, this episode is an invaluable resource.Connect with Lamont and Kelly: https://www.linkedin.com/in/lamontblack/ https://www.linkedin.com/in/kelly-richmond-pope-cpa-83689a5/ Full Episode Transcript:Adam:            Welcome to another enlightening episode of Count Me In. Where we delve into the pressing issues shaping our world and the business landscape. Today, we have the privilege of hearing a wonderful conversation between our guest host, Kelly Richmond Pope, accounting professor and author, and Lamont Black, an Associate Professor of Finance at DePaul University. They discuss an issue that is at the forefront of finance innovation; cryptocurrencies and blockchain technology. Lamont brings his vast knowledge and expert insights to help demystify these complex topics and explain their relevance to the finance industry. So whether you're a CFO, a controller, a finance professional, or simply a curious listener, prepare for a deep dive exploration into the world of blockchain and cryptocurrencies. Let's get started. Kelly:              So Lamont, thank you so much for joining me, today. And if you could start by just introducing who you are. Lamont:         So I'm an associate professor of finance in the Driehaus College of Business at the DePaul University. So I'm one of your colleagues. Kelly:              You are one of my colleagues. And, so, I want to welcome you to the IMA podcast series. And I have been working with the IMA, a little over a year. Working in research and thought leadership about ethics, corporate governance, risk, and you know my favorite love, fraud. And as we watch the news, read the news, what has just been in the news, so much, in the past, I'd say 18 months, is this really weird word called cryptocurrency.  And when I came to you, originally, about trying to understand what in the world is cryptocurrency. What you shared with me was how important it was to understand blockchain. And what I want to do, today, is have you really break down the importance of understanding blockchain. Because what I think the world is getting a little scared about is when you keep hearing about cryptocurrency, these exchanges that are falling apart. And, I think, everybody is really skeptical of this concept of cryptocurrency. But what I know you feel is, though, people might be scared of that. But you still need to understand the soundness and the value of the underlying technology, which is called blockchain. So could you tell us a little bit about what blockchain is and why we need to know about it as managerial accountants? Lamont:         Yes, so blockchain is the platform behind cryptocurrency. And blockchain is a technology, that, I think, everyone should be trying to understand. It's really a system of shared record keeping. So if you think about how we now live, in the information age, most of what we do is involving data. That data is being stored and shared using different systems, today. Whether that's on the cloud or other types of servers, and the blockchain is a way of sharing information. So that it's recorded on a shared ledger. So you can really think of blockchain as a system of accounting. And what makes it different is that rather than these ledgers being held in a private form. Different ledgers on different institutions that, then, have to communicate, blockchain cuts across all those silos. It's a way of recording information across an entire network. Sharing that information with the network, that makes it very secure, very transparent, and very efficient for sharing information.  So as we move deeper and deeper into the digital economy and e-commerce. I think every organization should be trying to understand how do we store and share information on the internet. I think blockchain is likely that next platform. And, so, even in the world of accounting, this is where things are likely headed. Kelly:              So that's a great explanation, and it really makes me feel a lot more comfortable in understanding that. Although, I hear all this craziness about cryptocurrency, and cryptocurrency is just where you shouldn't put your money. You've made me feel a lot more comfortable about why I need to understand blockchain. But let me digress, for a second, what in the world is going on with all that we hear about FTX, and the collapse of these exchanges? What is that conversation even about? And how does that affect or how should it affect our opinion of blockchain? Lamont:         Yes, so cryptocurrency is the money that is transferred across public blockchains like Bitcoin and Ethereum. And, so, people can own Bitcoin and Ethereum as digital assets, and crypto prices ran up, dramatically, during COVID. There are different arguments for why that occurred.  But one of them would be the amount of monetary stimulus. As people had all these different sources of income coming in. Let's say through stimulus checks in the form of fiscal stimulus, that money flowing into the economy. A lot of that ended up in crypto. And, so, Bitcoin almost reached $70,000 for one Bitcoin by late 2021. And as we moved into this year and our economy started to slow, inflation started to rise, largely as an outcome of COVID, crypto prices started to collapse.  Now, some people focus on the collapse of the crypto market as being something unique. But I just would point out that the stock market also entered bear market territory in the first half of this year, and in particular, tech stocks. So tech stocks are very risky. And, so, speculative assets during an economic slowdown, those prices tend to fall the most.  I view crypto as a form of technology. It's the frontier of technology. So, to me, it's no surprise that as risky assets have sold off this year, crypto has gotten hit the hardest. Now, as it relates to the exchanges, that's really been the problem this year. Because most people when they buy crypto, they buy it on an exchange like Coinbase, here in the US, or FTX, which was an offshore exchange headquartered in the Bahamas.  Now, many people wanted to jump on the crypto bandwagon, especially, as prices were rising. And, so, a lot of people were investing their money in exchanges like FTX. But one thing that people didn't fully appreciate, in this period of time, is when you own crypto on an exchange, you don't actually own the crypto itself. It's really being held on your behalf. And, so, FTX is what's called a centralized exchange.  When a centralized exchange fails or goes bankrupt, you're going to lose your money. They're going to freeze those redemptions. You're not going to be able to get it back. And, so, now, I think a lot of the fear around cryptocurrency is not just in the price volatility, it's also the fact that you could lose everything. And, so, I think crypto does have a PR problem, now, of people just being hesitant and confused about where all this is headed. Kelly:              Well, and I think what's interesting, about our conversation, is as managerial accountants, as CFOs, as controllers, as finance professionals. We could be interacting with clients and or in an organization that either embraces blockchain or accepts cryptocurrency. At the way that they handle transactions.  And, so, it's really important for us to understand some of these nuances. And my question to you is this how do I know what exchange I should engage with if I do want to purchase cryptocurrency? Because I do have to use an exchange, correct? That's the only way. Lamont:         Yes, it's the only way to enter the crypto ecosystem. So if you think of cryptocurrency as a currency, a form of money, then, it's like a foreign currency. If you want to buy euros with dollars, or if you want to bring the euros back into dollars, there's an exchange rate.  And, so, the price of crypto is really an exchange rate between dollars and crypto. And the U.S. money, the dollar, is a fiat currency. And there's a long history behind that term but it, basically, means that we are no longer on the gold standard. So the U.S. dollar is not backed by anything physical. It is a fiat currency.  But in order to buy crypto, you have to go through something called a fiat on-ramp. Because you're basically buying crypto with U.S. dollars. You can't do that just anywhere. You have to go through one of these exchanges, which is why that's the starting point for most people.  But one key point that I would like to highlight is you don't have to keep your funds on that exchange. And, so, the exchange that I typically use to buy crypto is Coinbase. Because Coinbase is a U.S.-headquartered institution. It's publicly traded on the U.S. stock market. Highly regulated by the SEC. And, so, it's, relative to FTX, a little bit safer but not totally safe.  There could be a run on Coinbase as well. But once you own crypto on Coinbase, you then have several options. You could move that money into something called a digital wallet. And what makes a digital wallet different from an exchange is that you, then, own the crypto. You manage what's called the private key. There's no risk of bankruptcy for some type of exchange because it's like money in your wallet. Just like U.S. dollars in a physical wallet, this is crypto in a digital wallet. You own it, you manage it, and so it protects you from some of those types of risks. Kelly:              For the first time, in my life, I understand everything you're saying. Lamont:         That's great. Kelly:              But you know what, how you described the exchange is making transactions on your behalf versus the digital wallet. I understand it because I actually own some crypto. Yes, I'm the accountant that owns some crypto. And let me tell you a little bit about the way Lamont and I met, first. Because, yes, we are colleagues at DePaul University in Chicago, but we also were in a movie together. And we were in a movie about a fast-appreciating asset, at that time, called HEX.  And, so, there was this production company that was doing a documentary about this gentleman by the name of Richard Hart. And Lamont and I actually flew out to the south of Spain to interview, can you believe we did this Lamont? Interview Richard Hart at this undisclosed mansion on the cliff of a mountain, on the side of a mountain. And I was completely skeptical of everything crypto. I didn't have the understanding that, of course, you had Lamont.  But it was fascinating to watch you go back and forth. You were a finance superhero going back and forth with this gentleman, about this cryptocurrency that he created. So my question to you is this; when we did this project, together, and all that you know about blockchain, all that you know about crypto. And then there's this new created currency that this gentleman started, what was your opinion of that experience? What was your opinion of HEX, at the time? Lamont:         Well, that was a pretty crazy experience. But it was great working with you on that. So I think what's hard for a lot of people, with cryptocurrency, is that there are so many of them. So I think everyone's now heard of Bitcoin. Most people have now heard of Ethereum or Ether. Those are the two largest cryptocurrencies. But if you go to a site like coinmarketcap.com you can see that there are now over 10,000 cryptocurrencies. And, so, people wonder, "Well, where should I invest?" "What's right, what's wrong?" "What's legit?" "What's a scam?" And I would acknowledge that there are a lot of cryptocurrencies that are a scam. That's why I don't encourage people to just follow hot tips. You should never be looking for some crypto that no one's ever heard of, but you think is going to pump for 100 X over five days or whatever. You should just focus on the core ones like Bitcoin and Ethereum.  But this documentary, we worked on, was for a particular cryptocurrency called HEX. Which is really an application, a project, built on Ethereum. And, so, what's also important to understand with cryptocurrency is you have your native tokens that trade on the blockchain itself, like Bitcoin or Ether on Ethereum.  But HEX is a project built on Ethereum that can create its own token, on top of the Ether token. And that project, the documentary, was really about is this project legitimate or not? And we were brought in, as the skeptics, to try and ask some hard questions. And I think we ended up in a place where we were not fully convinced that this was the future of cryptocurrency. I'm a big fan of this space. I do think cryptocurrency has a lot of potential still. But for some of these individual projects there's still a lot of question marks.Kelly:              Now, when you go in and you do your consulting with organizations. What do you find to be the questions that the employee population may have or the executives may have? Lamont:         Yes, so I'm in the finance department, in the financial services area. And, so, a lot of the firms that I work with are financial institutions, banks, credit unions. Trying to understand what does this mean for the future of money and banking, which is actually how I got into this space. So, as a quick background, I'm a former economist from The Federal Reserve. I was there through the financial crisis. And, so, my background is very much in risk and regulation.  But when I left The Fed to join DePaul and started teaching money and banking back in 2013. It was my students who started asking me about Bitcoin. And that started a whole journey, for me, about is Bitcoin money? And I'm now convinced that it is an important chapter in the evolution of money.  Whether Bitcoin itself will become a common means of payment, it's still yet to be seen. But money is digitizing and assets are digitizing, I think everyone would agree with that. And, so, the financial institutions that I work with are often inviting me in to speak to their board of directors, to speak to the leadership team. To talk about strategy and really strategic risk.  Could this emerging ecosystem of crypto and blockchain, potentially, disrupt traditional financial services? If people start using blockchain as a peer-to-peer payment system, that could disintermediate banks and credits from the payment network and the payment system. To the extent that people are now able to get loans on a blockchain. So decentralized finance, or DeFi, is an entire financial system that's being built on the blockchain network.  And, so, banks and credit unions are looking at this, trying to figure out do they have a role to play in the future of this technology? Because the original vision for crypto was replacing banks, even money without governments. But with the importance of regulation, with the importance of ethics and society. What we're likely going to see is an integration between traditional finance and decentralized finance. And banks and credit unions are going to have a very important role to play at that intersection. Kelly:              Interesting. Well, Lamont, this has been great. What I'm also excited about is we are working on a paper, together, in conjunction with, of course, the IMA, about the management, the risk of blockchain and what managerial accountants and finance professionals need to know about this space. So I hope that everyone that listens to our conversation, today, also reads the paper that we write because it's eye-opening.  I know that I've learned so much from working with you and listening to you. I did purchase a little snippet of HEX when we were doing that project, of course, it is almost worthless at this point. So I don't know that I am a big cryptocurrency cheerleader, yet.  But I do have a respect for blockchain and understand that it is something that we need to know. Like you said, I don't know where we'll be five, 10 years from now, but I do want to make sure that I am current. And this sounds like it could be a big change.  Something that you said in one of the answers to the questions, is you talked about the idea that blockchain is this decentralized, peer-to-peer type process. And I want to focus on the word decentralized. Because one thing that you said, when you talked about it being decentralized, is you then said that you used Coinbase. Which Coinbase was highly regulated, had oversight by the SEC.  And, so, what I took from your comments is the point of this integration piece is probably what makes most people feel confident, more confident and more secure. Because there are pros and cons about something that's decentralized. The pro is you don't have this third-party intermediary. But the con is you don't have the regulatory body that may give a sense of security and integrity to the data that a lot of us, especially accountants, are used to filling.  So I like how you talked about this idea of the integration of the two as opposed to the replacement of one. And that resonated with me because for people like me who are ultra-conservative, especially, when it comes to money. I think the integration and appreciating the integration of how this technology can impact business transactions, in the future, is really important to understand.  So I'm rambling a little bit, but I finally understand what you're talking about. I'm not a cheerleader like you, yet, but maybe one day. Maybe one day. So, any lasting thoughts that you want to say before we end our talk, today? Lamont:         Well, first of all, I'm very excited to work on this paper with you, Kelly. Because I think I'm coming at it from the perspective of finance. You're coming at it from the perspective of accounting. So in terms of managerial accounting, we're going to bring those two perspectives. Help people understand the implications of this technology, and help remove some of the fear and hesitation around this.  Because, like you said, crypto has very much gotten some bad press, recently, because of FTX. But I want to help people understand blockchain and crypto are related. We don't, necessarily, have to pull these two entirely apart.  And, so, in this article, we're going to talk about public blockchains like Ethereum. How can you use that for business use cases and things like that? So this will be a unique take on blockchain, relative to some of the other things that are out there in the accounting space. So I think we're going to have a lot of value to bring to the profession. Kelly:              Well, thank you so much for the time, Lamont, this is great. And, listen, we have a movie premiere coming up one of these days soon. So we need to walk the red carpet, bring our families to the red carpet, talking about this crypto movie we did together. So I can't wait for that day. Lamont:         I'm looking forward to it, too. Kelly:              Thanks so much for the time, today, I really appreciate it. Lamont:         Thank you, Kelly. Announcer:    This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website site at www.imanet.org.

Join us in this episode of Count Me In as we welcome our esteemed guest, Nykema Jackson, Head of Reporting, Policy and Technical Accounting at Airbnb. As we navigate the tides of remote work, hybrid models, and the aftershocks of the 'Great Resignation,' Nykema shares her insights into the art of staff development and leadership in these changing times. Discover how organizations can keep their staff engaged, foster open and trusting relationships, and leverage technology for connectivity and team building. Nykema also delves into the importance of empathy, clear vision, and timely feedback in creating a culture that inspires employees to stay and grow. Tune in to decode the leadership formula for the new world of work. Connect with Nykema: https://www.linkedin.com/in/nykemajackson/Full Episode Transcript:Adam:            Hello and welcome to Count Me In. The podcast that brings you the latest insights and practical advice on leadership, accounting, management, finance, and business. I'm your host Adam Larson, and today we are delighted to have Nykema Jackson with us. With a rich background in consulting and a significant leadership role in corporate America. She's here to share her views on the pressing issue of our time; staff development and leadership in the era of remote and hybrid work models.  As we explore the new paradigms that have emerged in the wake of the Great Resignation, let's dive into the conversation to learn how we can foster engagement, trust, and growth in these transformative times. Please join me in welcoming Nykema to the show. [00:00:43]       < Music > Adam:            So, Nykema, thank you so much for coming on the podcast today. We're really excited to have you on, and today we're going to be talking about staff development and leadership. Which is a big topic today because in the last three years we've seen a lot of changes. With the change to working from home. And, then, now, as things have gone back, going back to hybrid. And we've had terms like The Great Resignation and quiet quitting being thrown at everybody.  And, so, as we're talking about that, can we maybe discuss, from your perspective, how do you see an organization can keep their staff engaged and continue to develop them in the midst of all this? Nykema:        Sure, and thanks so much for having me. One thing that I've seen in my career, and I've come from a consulting background and, currently, I'm in corporate America working for a company. I've seen that individuals need leadership that knows and is very intimately versed in the mission of the company. That is invested in their employees. And investments from a learning and development perspective, as well as investing in them as a person.  And, so, COVID has brought around this environment where we've merged lives. We had our work cells before we had our personal cells, and now those things have come together. I find that it's critically important to recognize and acknowledge that in people, and to support them down both avenues. And when someone feels invested in and developed, and they know the mission that they're marching towards. I feel that turnover is less and you can get around the big resignation. Adam:            So I completely agree. As you continue to engage people, they will stay where they are. But, then, there's also the quiet ones who aren't really as engaged with what's happening. You can develop, and you can pour yourself into the people who are engaged and want to be there. But how do you grab those folks who are not quite there and want to be there? Nykema:        So one of the things I do, personally, are one-on-one check-ins with my directs, and sometimes I do skip levels. You'd be amazed that for those quieter ones, how much they open up in a one-on-one environment. I think people need to know from leadership, and I feel like sometimes we get lost in our own trajectory and progression. We don't realize that as we rise in the ranks, there is a level of intimidation for people. So you need to make it an open-door policy, and you need to make people feel comfortable to come to you. And one way to do that is to develop relationships.  But it takes a concerted effort on the leader to make time for that. Because it's not that time is on our side in a lot of situations, and COVID has created an additional barrier around that. Where people can't just pop in your office, they can't just see you in the hallway. They can't just strike up a conversation around the coffee machine.  They have to be deliberate and intentional on making those relationships and fostering that along the way. And the only way to do that is to schedule the time. So that it can start to become organic. Where they feel more comfortable with their relationship, with leadership, and they'll come to you naturally. Adam:            Yes, it's almost like you need to create some open-door Zoom call or open-door office hours on Teams, where people can just pop in at any time. Where they're able to do that, and the technology is out there. And how has technology helped you in the midst of the COVID era and able to reach out to people? Nykema:        So, for me, COVID has opened up a whole universe of additional time, for me, it's saved me a commute. So I've been able to use technology, in a way, to connect with people, and I make it less transactional. So some folks get a little intimidated by being on screen.  And, so, one thing that I've done is I don't multitask while I'm on calls. I silence my email so that I can really focus on individuals. And with the use of technology, we're able to do teaming events virtually. Sometimes we'll do happy hours, where we'll send a bottle of wine to individuals. I haven't done that on my current team, so don't tell them.  But in the past, I've sent bottles of wine, or if there's something that they like around coffee, or something, gourmet, I would send that, and then we would have a virtual outing. And it gives people the flexibility to still be there for their families, and their children, and whatever extracurricular activities that they have. But we can, literally, pick any time of the day to do this now. Versus sequestering it to the end of the day. Adam:            Yes, our team did a virtual wine and painting. Where they sent the wine and the painting thing, and then the person did it through Zoom and show us. And we'd all sit there painting, and drinking our wine, and it was actually quite fun. More fun than I realized it would be, doing it virtually. I never thought it could be like that. Nykema:        Absolutely. Adam:            Do you have any other examples of how you've been able to develop your team, in the midst of the COVID era. Even before the COVID era, where it was difficult for the team members to connect. Nykema:        So one thing I find with individuals, from a connectivity perspective, is that you have to build trust. And to build trust you have to be vulnerable, and to be vulnerable, you got to share. So being authentic at work, a hurdle for some people because they don't want to expose themselves.  But I've found that I've reached more individuals and created more solid relationships by airing my, I would call it, dirty laundry. Sharing examples of obstacles that I've had and I faced. Things that didn't go well, how I approached that. Sharing my network.  I think when people see that you're vulnerable and you make mistakes, too, they're more comfortable to come to you about what their career goals are. And once you tap the pulse on where someone wants to go. What they want to do, professionally, and sometimes even personally, and you're able to support them in that vein. Then you're able to crack the code on what do you need to do to support that person with whatever that thing is. Some people are technically savvy. They may need help with soft skills, they might need help with setting agenda-based meetings. They might need help with public speaking. But you don't know what those insecurities are, or the things that they're wrestling with, without opening up the door of conversation. And a lot of your folks will, sometimes, feel like, "Hey, I got to operate this level because I don't want to expose any of my weaknesses." So by sharing your weaknesses, it gives them the avenue and the invitation to share those that you could better help them and develop them. Adam:            Yes, it's almost like you have to get over that hurdle. That social hurdle of, "Well, if I share trust with you, it'll show my weakness, and then somebody will take advantage of me." And it's creating that aura, that safe space, in a sense. Nykema:        Absolutely. And I find that that's very critical in building relationships so that you can lead a team; inspire, motivate, develop them, to come around what the overall mission would be for that company or that particular function. Adam:            Definitely. It makes me think of, I remember years ago, reading, so I think it was Stephen M.R. Covey did the speed of trust. And I think his biggest thing was always that trust is always a two-way street. That you can create that atmosphere, but then it has to come back. In order for it to build and grow that relationship, and that's huge in a work environment. That if you're open, then, other people start to feel that safety to be open as well. It's kind of what you were saying? Nykema:        Absolutely. And one thing I would add on to that, Adam, is also empathy. It's a lost art, I feel, in some spaces. And that when people feel like you really see them for who they are. You can relate to what they're going through. Because there's a lot of personal hurdles that have come out of COVID. People have lost loved ones.  People have had to balance work and life and the intrusion of that. With taking care of small kids or taking care of the elderly. And I feel like when you can relate and support them in that vein, they're willing to go to the mud for you when they have to. But it's a two-way street, like you mentioned. You're there for them and then they're there for you. So it's a reciprocation of that trust, respect, and support.Adam:            Mh-hmm, and it builds a better, stronger team because we see each other as humans, and we see each other no longer as boss and employee. Nykema:        Exactly. And, to me, when I look at the cutting-edge companies or the companies that are leading, it's that leadership that people can follow behind. It's not so much focused just on salary, and the company. It's the leadership and where they're taking that company, and the spirit and the tone at the top that permeates throughout. Adam:            So when thinking about leadership and its effect on staff development. What are some traits that you've seen have been the most effective, when trying to create this atmosphere that we've been talking about in leaders? Nykema:        So one is clear vision. You want to follow behind someone that knows where they're going and how they're going to get there. Not that you have to know everything. I think using the talents of your team, and building your team around some of the areas that you may have some developmental points, personally, is important as a leader.  Delegating and not just delegating the tasks that you don't want to do, but delegating the inspiring tasks. The things that they want to actually get involved in, the things that are going to develop them. Showing that vested interest in individuals, as you're taking them along. And feedback; feedback is so important to people, and not just at the annual or the biannual periods. Where it's structured through talent.  But feedback on a timely basis on what they're doing well, and constructive feedback. And I find that a lot of leaders do shy away from constructive feedback because it is uncomfortable. But I do realize in all my roles, currently, and my prior roles, that I've won the most trust in people when I've given them the constructive feedback. In a way that they can digest it, of course, but something that they can hold on to to increase their capabilities or to develop further for that next step. Adam:            I feel like that constructive feedback is almost like the lost art of empathy, that you mentioned earlier. Where having that it's like that coaching. Where you're coaching people to become better versions of themselves. And have you been able to find ways to do that constructive feedback or even coach people, in order to help improve them? Nykema:        Absolutely. So, typically, what I do, if I'm starting in a new organization or I have someone that's new coming into my team. I like to lay the groundwork, up front. So I usually have a one-on-one discussion with them about my leadership style, what motivates me. Then I'll ask them what motivates them. How would they like to receive feedback? What's the best form? How frequently would they like to receive that feedback?  And then I tell them, when we talk about the avenues of constructive feedback, that feedback is a gift. And because it's so hard for people to do it, whether it's a function of time constraints or just their comfort level. That when you have someone that does that, to me, it's a quality that shows that they're really invested in you.  And, so, when you have someone that does that, they're truly supporting your progression and not just saying, "Hey, good job." And you're able to work on the things that are not mentioned to you. And, then, sometimes, people wonder why they're stagnant and why they're not moving to the next level. Because they haven't gotten that behind-the-scenes feedback, that's discussed in a lot of review committees.  So when they can see that feedback as something that's beneficial and something that is important to building, to your point, that lost part of empathy and trust. Then they get on the bandwagon with it, and they're okay with receiving it because they know it's coming from a good place. Adam:            Yes, that's a really good point. And as you were talking it made me think of as leaders, sometimes, we get so lost in the weeds of the day-to-day work. That we forget to see the bigger picture of how we can help improve our employees. And what would you say to somebody who is like, "I never remember to give feedback, until it's time for reviews? How do I remember to do that more often?" Nykema:        That's a good question. I'm trying to think of what I, personally, do. I think it has to be just part of your way of working. And from an objective perspective, I think that if folks don't feel like they have enough time to do it, then, they're probably not delegating enough.  There should be a good portion of your day or your week, where you're really just thinking about "How well is the week going?" Sometimes that's based on the tactical objectives. But, sometimes, that's based on how they were executed. And your biggest, most important resource, at any company, whether you're in consulting or at a corporation are your people.  Your people drive your business. Your people interface with your customers. Your people grow your bottom line. So without investing in them, you're remiss to not give them the feedback. So that they can better themselves and feel more tied to that mission and their own personal development. Because I always say, and I know you've heard this from other people, people don't leave companies they leave bosses. So if you're not taking that time to invest in them, why would they stick around? Why would they support you when you need their level of flexibility? When you need them to go and work extra hours, or push through on a very important deadline, or a deliverable. If you're not even taking that little bit of time to invest in them and show them that you care. Adam:            Yes, and as a leader, if you feel like you don't have that time, you have to reevaluate how are you spending your time. And, then, like you said, are you delegating enough? And, then, if you aren't able to delegate enough, then it's more of an organizational, like, "Hey, everybody's kind of overworked, how can we reorganize things to help things?"  Because a lot of organizations are feeling the pressure of, "Hey, we're back to work. We need to be back to pre-COVID levels of sales, and yada, yada, yada." And I don't know that people are adjusting as well. Nykema:        I totally agree and I've seen it in my career. In that when an organization is overworked and you're stretching your people, your turnover rate is extremely high. There's definitely a correlation between the two. So you have to make time and mental space to do it because feedback also is a delicate delivery. It's not something you could do off the cuff. You really got to think about how you want to deliver that message, and what's your ultimate objective in giving that feedback. Do you want to harm confidence? Do you want to build confidence?  Do you want to motivate?  Do you want to inspire? So it's not just a matter of delivering the actual facts of what happened. It's how you deliver it that will allow that person to receive it and do something good with it. Adam:            I agree. And I just keep thinking back to when you said the lost art of empathy, it just really set something off of me. And I really connect with that as somebody who has come to realize, as I've reflected on myself, that I'm a very empathetic person. Where I can look at somebody else's situation and connect with that because of just my life situations that I've had. And thinking about that, I think that's why we've seen a rise, within corporations.  Not only because of the social structures of what's been happening in the U.S. and around the world, but a rise in people's recognizing the true importance of Diversity, Equity, and I'll add Accessibility and Inclusion, I feel like we miss the A, sometimes, in that terminology, within organizations, on how you're developing your team.  How you're connecting with your team. And I feel like COVID helped us see that where we were invited into people's homes as we had meetings, and we're having meetings, and suddenly a kid runs in, or a dog runs in, or they have those issues. But we're suddenly seeing the importance of connecting with people and empathizing with their moments. And how diverse we all are within our thought processes, within our life experiences, and how important that is when you're leading your team. Nykema:        Absolutely. DEI is one of my passions, no matter where I go or what organization I'm a part of. And I find that companies, across the board, they do a good job, some of them do a great job with diversity. So making sure we have people of diverse backgrounds, experiences, cultures, way of working, and all that good stuff. Where I find companies struggle sometimes is the inclusion and the equity piece.  And, so, you get all these diverse people together. It's almost like you have a dinner party and you invite everyone there, but you don't prepare a meal for everyone. So everyone doesn't get to eat. And I feel like that is something that companies are still trying to strife for, and I know there's lots of training on it. There's lots of self-development on it.  But I really find that the companies that get it right, it's just a part of the overall fabric of the company. And it's not something that you're, necessarily, just teaching. It's coming from the tone at the top, and it's being those allies in those situations because you're bringing all these people from different background, different companies. They don't, necessarily, have a focus on inclusivity.  And, so, I've seen it work really well, in my current employer, in that there's a focus on being an ally. So if you see something, you say something. And you mentioned earlier about the quieter ones. So they have protocols for people that maybe don't want to have direct conversations in situations where they feel like something's going awry. They say, "Hey, why don't you pull that person to the side and ask how they felt about that interaction, or that situation?" So it's taking it a step further, beyond just being a diverse company, but creating a mechanism and developing a culture that's focused on now that we have everybody at the dinner table, let's just make sure everybody's eating. Adam:            Mh-hmm, yes, to use the dinner table analogy, you can have everybody at the dinner table. But if all you're serving is steak, the vegans, the vegetarians, the pescatarians won't really feel like they can be included in the meal. They can maybe just pick up the salad and that's about it, but they don't really feel like they're a part of the team. Nykema:        Absolutely, and it makes me think back to what you said earlier around traits of a leader. One thing I want to call out is flexibility. So flexing your style. So to your example around the vegans around the table or maybe the pescatarians.  You may have to flex your style once you understand what motivates that person. And it doesn't mean that you're not being true to yourself, it just means you're being a servant leader. And you're figuring out, "How do I adapt, as an executive or in a leadership role, to make sure that I'm reaching everyone on my team." Everyone is talented, everyone has the right skill sets. But it's a matter of how do I motivate them, individually, because we all have different personality types. Adam:            We do. Nykema:        So, sometimes, it even goes beyond just skin color, or race, or nationality. It's my personal style may be a driver; someone's personal style may be an amiable. I have to figure out what motivates that person, to be able to reach them. To have that empathy, to connect with them, and to develop them. Adam:            Mh-hmm, and that's the biggest part of DE&I is going beyond just one element of it and seeing the whole picture, and that's how we become better at the inclusivity part of it.Nykema:        Absolutely. And it reminds me of, you've probably seen this, that visual aid that you see in a lot of DEI trainings of that iceberg. Adam:            Yes. Nykema:        The stuff that's above the water. The things that are below the water; the only way you get to those is by developing relationships. So it goes back to our earlier conversation around how does a leader develop people that are on the quieter side or the people that they want to have a level of influence over?  Well, you can't get to below the iceberg unless you're having those one on ones, and really trying to understand, and asking the questions, and empathizing with who they are. What their goals are personally and professionally. That's the only way you could be fully inclusive beyond just what you see visually. Adam:            Mh-hmm, and by being able to do that is by being open yourself, by building that trust, and also by being empathetic to their situation and how they can communicate. Because not everybody communicates the same way. And if you don't communicate, if you're not able to adapt and be flexible to communicate in a way that makes them comfortable, then, you'll never get to know them. Nykema:        Absolutely. Adam:            Well, Nykema, I feel like this has been such a wonderful conversation. I feel like we can keep going. But I just want to thank you so much for coming on the podcast, today. This has been wonderful and I really hope our audience enjoys it. Nykema:        Thanks so much for having me. I enjoyed, equally, as much, engaging in this discussion with you. [00:21:56] < Outro > Announcer:    This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in, for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

In this illuminating episode of the Count Me In, we sit down with our esteemed guest, Janis Parthun, VP, Advisory & Project Services at RGP. She is a leading voice in the world of Environmental, Social, and Governance (ESG). Dive into the intricacies of ESG, understand its importance in a business context, and explore its different facets - from the environmental to the social and governance perspectives. We also delve into the challenges companies face in implementing ESG strategies, discussing the evolving regulatory landscape and offering insight into the best practices adopted by forward-thinking businesses. Whether you're an industry veteran looking to refine your ESG approach or a newcomer eager to implement an ESG program, this episode is brimming with valuable insights.Connect with Janis: https://www.linkedin.com/in/janisparthun/Full Episode Transcript:Adam:            Welcome to another exciting episode of Count Me In. Today we have a special guest with us, Janis Parthun. VP, Advisory and Project Services, at RGP. She is an expert in the field of Environmental, Social, Governance or ESG, as many of us know it.  Janis brings a wealth of knowledge providing a fresh perspective on the complexities and significance of ESG. She will walk us through the intricacies of ESG, discuss its growing prominence, and share valuable insights on its implementation. So if you're looking to understand ESG better, and how we can add value to your business model, this is one episode you won't want to miss. Let's dive right in. Janis, we're really excited to have you on the Count Me In podcast. As we go into today, we're going to be talking about ESG or Environmental, Social, and Governance, and we hear a lot about that. IMA talks a lot about that. We've been publishing articles. There's a lot of things happening in the industry. But maybe we can start off just at a higher level and talk about what does it mean, what does it represent, in an organization? Janis:              Yes, Adam, happy to do that. The term ESG or Environmental, Social, and Governance can really differ just depending on who you speak to. But I'd like to establish some initial background here. Where environmental focuses on the company's impact on the environment. On the risks, and opportunities associated with the impact of climate change on the company, its business, and its industry.  Social may focus on the company's relationship with people and society, or whether the company's investing in its community. And governance focuses on issues such as how the company is run, and possibly connect to executive compensation.  So ESG has been an important element to organizations approach to create value, as part of the business model, and just to the greater society impact. But what does this entail? Is what I often hear. And to elaborate a little bit more, a company's overarching ESG program will likely have top priorities determined around ESG matters. With goals, which includes metrics and possibly targets for future outlook has been set and established. To reach the goals and the targets, the company may have various initiatives and action, in order to support the goals. For example, a company may have climate change as one of its ESG priorities or material topics, and a goal to reduce emissions with the target of 40% by 2040. The organization, then, may have an initiative or a project to convert all transportation fleets to electric vehicles, as a strategy to reduce the emissions.  But when we're discussing ESG, at the overarching program or program level, this is applicable across multiple material topics or priority topics. Now, the topic of ESG is not new, and there are significant funds and investments around this.  Currently, over 96% of the S&P 500 already, voluntarily, publish sustainability reports in some form or fashion. But an increasing interest from parties to invest, and companies wanting to communicate or report on ESG. Regulatory and standard-setting bodies are also paying attention to how companies are reporting on ESG matters. Adam:            Definitely, and you see a lot of the bigger organizations implementing it. But smaller organizations may not quite be ready or there, yet. And if you are one of those organizations that are saying, "You know what, I want to jump into this, get into this." What are some steps that a typical company might undergo to establish an ESG-type program? Is there a specific, strategic, approach that you need to take when you're implementing that? Janis:              Yes, that's a great point, Adam, and there is a recommended strategic approach to this. So the other aspect to think about is the ESG strategic roadmap or steps that companies, typically, may undergo to establish an ESG program. First, is really having to determine materiality. This is driven by stakeholder and market input, industry profile, business strategy, and suggested standards and frameworks. And, then, setting goals and targets and execute on the reporting.  So establishing process and oversight to have that accountability, and report or update related to performance metrics. And, then, establishing quality control. Establish process and governance to ensure the quality control of the data that's collected or reported, and of course, reevaluate in that cycle.  But, more often than not, companies are encountering challenges, during the midpoint stages of executing on the ESG program strategy. And this includes adhering to regulations, standards and frameworks, and just trying to stay current and up to date. There are several in the horizon, and it's a lot going on for companies to navigate through. Program management and governance, having organizational governance over the ESG program, and monitoring and tracking against existing goals, appropriately, and evaluating progress. For example, do you have a governance process around adding or revising priorities or metrics? And monitoring the actions or involved in ESG committee that helps govern the goals set and tracked. And data quality management; is the information reliable?  For example, is the information collected comprehensive to the metrics being tracked? Such as inclusive the various regions and markets. Is that information reliable? Such as is it trackable or include supporting details. And with each of these challenges, it's important to pull the right resources in to help and address. Adam:            Before we get too much into the details of program management and those challenges. You've mentioned, a few times, about different regulating bodies have been watching in certain areas. There are regulations and new standards coming up, and that can be challenging for anybody and everybody. A lot of people are overworked. People are getting stressed out, and the idea of having more regulations to follow can be very stress inducing. But, maybe, you can talk a little bit more about how it's affecting companies and what people can expect? Janis:              Yes, I can, definitely, elaborate that a little bit more, Adam, and dive a little bit deeper. From a regulatory driver perspective, and you're so right on this. And there's such an increasing scrutiny just on how companies are presenting the ESG-related information. As well as the push to reduce the climate impact to the environment. That multiple regulatory authorities are pushing their agendas, and that's what's creating all this pressure, too.  For U.S. public companies the pressure is coming from the SEC. With the biggest proposal on climate-related disclosures announced last year. To disclose governance, strategy, risk management, and targets on the climate impact and, specifically, greenhouse gas emissions. And there are multiple elements within the proposal that's creating concerns for many public companies. Especially around disclosing climate-related financial impact and Scope 3 Emissions.  I think by the time this recording is released, the SEC will likely announce an update and issue, possibly, a reduced-scope version of the original proposal. It is a lot to ask for companies to disclose on those areas. And this is just one specific proposal, and there are several other SEC proposals anticipated to finalize in the horizon, this year, as well. Beyond the climate-related disclosures.  And in the EU, the pressure is coming from the EU Commission. The Commission recently adopted a new rule, late last year, The Corporate Sustainability Reporting Directive or CSRD. For companies to publish detailed information on sustainability matters. To increase the company's accountability, and to prevent divergent sustainability standards.  This is a pretty big ask since there are 12 standards drafted with 10 specific ESG topics. Spanning from climate, to workforce, to business conduct. And this may also impact a U.S. company if the company has subsidiaries in the EU market. And there are also country jurisdictional specific requirements to consider. That I won't mention here because there's just a lot to capture.  But beyond reporting, the EU is also proposing another new rule to streamline information about companies' environmental performance of products, and to reduce misleading claims. So just to add one more thing to this, related to all this, is that companies are also, increasingly, being asked to communicate and report information that's understandable, across a broad base of the investor community. So more so around voluntary standards. And this is happening through recognized standards and frameworks for comparability, and there are a number of them as well.  So the top two standards that are frequently referred to is SASB and GRI. But there are also others, each with a specific mission. And, again, this is just a lot for companies to get a handle of and stay on top of. And I just wanted to, at least, share a little bit of the landscape of the different type of requirements or voluntary type of disclosures.  And, then, interesting enough, just to highlight or illustrate a little bit. So, for example, we at RGP had helped one of our clients on a related issue last year. The Task Force for Climate-related Financial Disclosures or TCFD, issued new recommendations in October 2021. And the client needed to understand the degree of the changes. As well as consider how this impacts the clients reporting to another global environmental disclosure system, the CDP in connection to the TCFD changes. So that's just one example. But the reporting information can also be interconnected across the requirements. Adam:            That's really interesting, and as you're going into this process. Either get some help or make sure you're staying on top of that, or find an organization that can help you stay on top of those standards, and help understand it better. Because depending on where your organization is, will be what standards you have to follow, obviously.  So we've talked about the standards and the different regulations, and you've gotten a very good overview of that, for the audience. But you mentioned aspects of program management and goverments outside of their keeping up with the standards and regulations. You have to actually manage the program. Maybe you can talk about what you've seen where companies are on track, where they're not on track, and maybe give some best practices. Janis:              Yes, happy to do so, Adam, it's a great point to bring up. So I've seen companies where they're really leading the pack, and companies where they're falling short on their ESG commitments to their stakeholders. Now, in terms of companies where they're really on track and where they're not. Industries that are ahead of the curve in ESG reporting are in consumer products and real estate, and for good reasons.  So for consumer products, recent studies show that consumers are shifting their spending towards products with ESG-related claims, and products making ESG-related claims have averaged higher cumulative growth, over a five-year period. This is a major reason that consumer product companies are pushing to be ahead of the curve in ESG initiatives, and to report on ESG commitments.  Chipotle is one setting a good example, recently. The company announced that its 2023 ESG goals will be linked to executive incentive compensation. Impacting its 2023 annual incentive bonus by 15%. So making that commitment to set the goals and hold its people accountable, to achieve the goals, is a great example.  For real estate, considering there's a significant emission generation from the real estate value chain, ESG is now a top-risk priority for the industry. And CBRE is one setting a good example. When the company entered into a new five-year revolving credit agreement, last year, to increase it's revolving credit facility. It linked the agreement with achieving certain sustainability goals. Such as to provide procurement spending with sustainable suppliers to converting vehicle fleet to electric vehicles.  But there are instances where the companies are using ESG to promote and market products misleadingly. And this is a lesson learned for one retail company last year. On what might happen when your organization lacks the program governance and the structure to manage the ESG initiatives, and the integrity of the data reported.  In this instance, the apparel company was investigated by regulators for misleading sustainability related products, and had to remove the labels from their products and websites. I mean, the company really broke the brand promise of offering sustainable apparel. It's clear that there's consumer demand for more eco-friendly products.  But, again, this is where the regulators are stepping in. And the European Commission had, recently, highlighted that over 50% examined environmental claims, in the EU study conducted, were found to be vague, misleading, or unfounded. And because of this, the Commission had since proposed a rule that I just had mentioned earlier to address.  And companies that are lagging behind in ESG reporting are more likely in IT or healthcare industry. With less direct customer or consumer pressures, or just have other pressures to take priority, such as COVID-19 in the past few years. And companies may also have other external pressures, such as having to obtain capital, for example, from the mergers and acquisition perspective.  A number of studies indicate that senior management suggest they're willing to pay premiums to purchase companies with positive ESG records. ESG is also influencing capital raising process. For example, this year, credit ratings agency, Fitch Ratings, announced plans to use its climate vulnerability scores to enhance the process to consider credit-relevant, climate-related risks or its corporate credit ratings for non-financial attributes.  So with the increasing demands by stakeholders, companies may wonder how they can establish or elevate to a solid ESG program and governance. To start, it's about understanding your priorities, based on your industry profile and business model. Because once the priorities are established, organizations can drill down further. Understand what specific metrics goals and targets are relevant, and integrate these activities to the business strategy.  With all this having a structured, more formal ESG program, with governance structure, can help set clear strategic goals and expectations. That are recognizable by a broader audience, and hold management and internal stakeholders more accountable. Whether public or private organization; just having structure can really help better communicate ESG efforts and progress to the community, to creditors, or investors that large Adam:            Janis, as you're given that answer one thing that really stuck out to me is data quality. And as we, in the accounting world, know how important your data is, and having numbers in the right place, and reporting accurate numbers. And I know that there are concerns around the quality of data in ESG information that is reported. And you made some examples of people not giving that accurate thing and, especially, on how they're marketing things. What can companies do to address these types of issues? Janis:              Yes, that's a great point to have a discussion. Yes, data quality is a significant concern for companies. And the concerns used to be more around the data collection and the availability of the information.  But now companies are getting more comfort around what information is available just through understanding and research. And it's been shifting more focus on the data quality, or the completeness and the accuracy of the data collected, calculated, and reported out. And there's been an increasing focus on the data quality with a number of our clients in preparation, more so for future assurance. And this is an increasing trend that's also being observed at the board level.  According to a recent survey, conducted with corporate directors. Over 50% of public company director respondents indicated that the higher quality of ESG information is being presented to the board. But, then, with a lower percentage and less progress for private companies. To address the concerns or focus area companies are seeing how they can prove the quality, through building internal control structure to ESG data. And interesting, and timely enough, the IMA, also, recently, issued a publication, Achieving Effective Internal Control over Sustainability Reporting. That directly speaks to having effective control and oversight to that ESG information. To have that high-quality and fit for purpose for decision making.  This publication is really resourceful, it's providing an overarching, regulatory landscape and incorporating the COSO Internal Control Framework, also at RGP, we've also built a consultation approach on this for our clients, incorporating the COSO Internal Controls Framework. So that we can be able to help guide the clients to be able to add control structure, and improve the reliance of ESG-related information.  Now, another strategy is around automation for the data collection and reporting systems. And while I don't, necessarily, think there's one true solution leader, yet. But there are definitely tools, currently, out there in the market, to help address either at the initial collection process. To the generation of the report or disclosures, and there are, definitely, a few few that are more prominent. But I do think that the platforms are maturing. They'll likely be a leader on this as the platforms mature.  But it's also important to consider what systems you can leverage within your organization. You'll want to think about what system or combination of systems, can also be able to help you pace all the way through. Adam:            Definitely, and depending what systems, as you can tell, as we talk about ESG, it applies across multiple functions within an organization. But who are we, in IMA podcast, to not talk about the finance and controllership function within an organization? What role does the finance team provide in the ESG reporting ecosystem? Janis:              Well, Adam, within the finance organization. Historically, controllership functions are familiar with implementing new reporting requirements. Working across multiple stakeholders and, at the same time, bringing that structure and that rigor to the process outcome. And this can be, similarly, said about the FP&A's function, as well, or the reporting and analysis role. Leveraging the same expertise to apply to ESG reporting. I really see the future role of accounting and finance professionals, to be ranging from the orchestrator to the gatekeeper of the ESG programs. Depending on the industry and the business model of the organization. If the company is more focused on addressing risk, finance may likely play a more significant role, as an orchestrator. Versus if the focus is on supply chain; operations or sustainability office more likely would be the orchestrator. While finance is the gatekeeper for the reported information. But regardless of which spectrum of the role the finance organization fulfills. One, definitive, role is to be the partner, working collaboratively alongside other functions. I have seen similar experience and value translate from financial reporting to ESG reporting. Besides staying on top of regulatory updates, finance and accounting professionals can also provide process and governance structure to sustainability reporting.  This includes developing standard processes for data collection. With associated reviewers and workflows, with sign off functions to building similar support structure such as a SharePoint site. For a one centralized communication of requirements, such as with dates, processes, sources, and training. The same attributes apply to operational reporting. As organizations are setting goals and targets to monitor and work across multiple stakeholders. Finance professionals can also bring that structure and the rigor to process outcome. The shift towards the future role and change can really be accomplished, through guidance development and education.  Companies in more mature stages of reporting, are developing guidance and, typically, expected from the finance organizations to enhance policies and procedures. That add to the structure and the rigor. But there are still many organizations not at that mature stage, and this is where education and training is key. To educate the finance and accounting professionals, to be the partners to the ESG reporting ecosystem. The other aspects to consider is to educate the process or data owners. Who may not have been previously involved from regulatory reporting or audit perspective. To be able to strive for and achieve for that level of detail and the quality of information expected. And as finance and internal control functions are, increasingly, getting involved.  We at RGP are also developing the project methodology and an ESG training program. To educate our consulting team on ESG reporting, and this is really to upskill our talent base, and to be able to anticipate our client need, and to be better prepared. Adam:            That's awesome, and it sounds like you're doing great work, and those are some great insights. And we've covered a lot during this podcast, and, maybe, to finalize things, maybe, you can give a summary of some final thoughts that you want our listeners to remember, as they walk away. Janis:              Yes, happy to, and a key point I want to emphasize is that, now, there are many more external pressures and expectations to consider when companies are issuing sustainability reports. And it's important to bring in the right people, to either implement and manage or to improve the ESG program. And this includes bringing in finance and accounting professionals. Who can be a valuable partner working, collaboratively, alongside other functions.  I am, personally, passionate about this topic. But more, importantly, how much value our finance and accounting profession can bring to a company's sustainability program. We should advocate more for this role, and just provide the guidance associated to support the profession. And that's really my last point, I want to emphasize. So thank you, Adam, for having me on this podcast. And I'm very excited about the future developments to come related to sustainability reporting. Adam:            Yes, thank you so much, Janis, for coming on. I really appreciate you sharing your insight with the audience. Announcer:    This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in, for more relevant accounting and finance education, visit IMA's website at www.imanet.org

Welcome to a brand-new episode of 'Count Me In' where we break down complex financial concepts into simple, understandable terms. In this episode, we unravel the mysteries of cryptocurrency and explore its volatile nature. We're joined by Jason Cozens, the CEO and Founder of Glint, who shares his insights into the current state of the market and explains why cryptocurrencies have become such a significant player in the global economy. Plus, we dive into the golden alternative, exploring how gold has held its purchasing power over thousands of years and how innovative technologies, like Glint, have made gold a feasible medium of exchange. Whether you're a crypto enthusiast or a gold advocate, this episode is packed with valuable insights that will help you navigate the world of alternative currencies.Connect with Jason: https://www.linkedin.com/in/jasoncozens/ Full Episode Transcript:Adam:            Hello and welcome to another episode of Count Me In. Today we're diving headfirst into the complex and ever-evolving world of cryptocurrencies. We're excited to have Jason Cozens with us. The CEO and founder of Glint, a global fintech platform.  He's an expert in cryptocurrencies and alternative currencies, and he'll be sharing his extensive knowledge about the current state of the market. Why cryptocurrencies exist, in the first place, and their inherent risks. He'll also shed light on the appeal of gold, as a stable, risk-off asset, and how it's been modernized for everyday transaction with technologies like Glint. So if you're curious about the state of cryptocurrencies, or the power of gold, as an alternative, this episode is a treasure trove of information. Let's dive in. Jason, I just want to thank you so much for coming on the podcast today. Really excited to have your expertise around cryptocurrencies and alternative currencies, in the market. And maybe we can start off by discussing cryptocurrencies and the state of that market, as it stands right now.  Jason:             Yes, sure, well, I mean, before we start looking at exactly the state of the market, now. I think it's also important to understand why the market even exists and, then, just to touch on that for a second. Why do we even have crypto currencies?  My movement into alternative currencies started in 2008 like a lot of people's journeys did for this. Where they realize that banks are not risk-free deposits of funds. When you put your money in the bank, it ceases to be yours. That money is put at risk, and it is lent out, it's a liability of the bank. And that's a problem for people and a problem for businesses that have money, and want to be able to put it into those banks. And, of course, we get all kinds of insurances from the FDIC et cetera.  But, at some point, they're going to change the rules, and they've already passed legislation called bail-in rather than bailout. Which means that when, next time, there's a banking crisis, instead of the government's bailing out the banks. They might say to, actually, "We're going to do bail-in this time."  Which means that if you've got a significant amount of money in the bank, they swap that for shares in the bank. Which you may or may not get back in a few years' time, and that's what they did in Cyprus, they tried it. They've passed the legislation. So it's something we've all got to be cognizant of. And, then, of course, inflation, and very few commentators are talking about one of the biggest drivers for inflation, of course, is money printing. And inflation is now rip-roaring through the economy, it's affecting individuals. It's affecting businesses. I thought it was bad back in 2008, when governments are trying to keep it at around 2%. Over my lifetime, the dollar has lost more than 85% of its purchasing power, let's just think about that. 85% of its purchasing power, and that was before actually the surge in inflation, I calculated that.  And, so, there's a need or people have been looking for something to hedge against systemic risks. They've been looking for something to hedge against inflation. And, also, generally speaking, the financial system is getting better at payments and cross-border payments. But, again, they're looking for efficiencies with that, too. So that's why we're in this space.  Innovations around Bitcoin, model a lot on gold and other types of cryptocurrencies now, like Ethereum and even stablecoins, of what created what was a $3 trillion market. And, obviously, what we've seen this year is that $3 trillion market completely collapsed to below a trillion dollars. Which is a huge drop for anybody involved in the cryptocurrency industry. But, yes, one trillion is still better than the kick in the teeth, and it's a significant industry, still, and I don't see it going away. And there's been a huge amount of money invested in that. But we all know it's been volatile. We've seen that volatility on a weekly, sometimes, daily basis. We've seen huge swings in the value of Bitcoin. For instance, it's gone down from $65,000 down to, I think, we're currently at about $17,000, something like that. And, again, that volatility is huge.  But previous to that, of course, we saw huge gains. I mean, it went from three or $4,000, over a few years up to $65,000. So you can see the attraction and why people got involved in that. Hey, it's this fantastic growth story, and we can handle the volatility in the belief that that growth story is going to continue forever.  But, I think, what happened when Russia invaded Ukraine was really telling. It was the time when we saw that, actually, cryptocurrencies are definitely what I consider a risk on asset. They're a speculative asset that may or may not work, may or may not stand the test of time. There's lots of optimism around it and, certainly, lots of ideas around how it can benefit society. But it's very much still a risky asset, as opposed to say something about other alternatives like gold, which are just considered slightly more boring, but risk-off assets and stuff.  So when the Ukraine was invaded by Russia, then we saw the crypto price plummet, and we saw the gold price go up, for instance. But there's lots of advantages around this. Apart from even the hedging against inflation and the hedging against the systemic risk, and the payments technology, just generally speaking.  The tech, the ability to program these currencies, is what's exciting a lot of people, isn't it? So I definitely think that crypto is here to stay. But we've all got to understand what it is and understand its nature.  Adam:            Yes, we do have to understand what it is. Because you don't know it, it doesn't seem as solid as something like holding money in your hands. But then we all know that money doesn't have any backing anymore. And, as you've already mentioned, the inflation and the things with banks can be can be risky, as well. So as organizations are looking at to getting into alternative currencies, are there benefits that they can look at? You've already mentioned a lot of risks, but there have got to be benefits to getting into this.  Jason:             Yes, there's huge ones, as I said. I mean, some alternatives do protect against inflation. I mean, you can't get any worse than fiat currency, in my mind, when it comes to inflation. I mean, it's the most terrible product in the world, when it comes to maintaining its purchasing power. So companies, especially ones who are long term, doing well, where they put that money, in order to maintain your purchasing power. Whether you're a company or an individual, you're having to make risky investments. Just to make sure you're maintaining your purchasing power of what's on your balance sheet, and that really, for me, is wrong.  So we've all got to look for how alternatives can help us make that fight. And, as I said, transactions and payments, I mean, a lot of people are using cryptocurrencies for payments, and it could be stablecoins as well, for instance. Although we've got to remind ourselves that a stablecoin is still backed by the inferior, in my mind. And current fiat currency is no different just because it's a stablecoin, it's still losing, its purchasing power over time. But at least it has the technology wrapper around it with a stablecoin.  So using cryptocurrencies, whether it's Bitcoin, or a stablecoin, to be able to move value from one part of the world to another, obviously, there's growing use of that. There's trillions of dollars' worth of transactions, now, happening and, sometimes, they're used for in real need. People trying to get money out of difficult regulatory environments. People are worried in China now about what's going on with their premier, and is it a good business, friendly place anymore or not? And even though they've banned cryptocurrency, over there, mining et cetera. A lot of companies are still trying to use that to move money offshore. But, then, just genuinely trying to move money quickly, and it can be used for that.  So, yes, they're all the benefits that we're all trying to find. I would say, though, that the idea that it's a get rich quick thing, you got to decide what business you're in. Are you in the business of making widgets or providing the service? Or you're in the business of using your hard-earned profits to speculate in markets? I don't really see that as a benefit.  Adam:            Yes, that is really tough as you're trying to weight the benefits versus the... So you discuss a lot about gold as a risk-off asset. And if anybody's heard you talk, in the news, you talk a lot about the benefits of having gold. And maybe we can talk a little bit about that, and how can that benefit organizations, or people, or individuals who are looking to have a more not-as-risky asset in their portfolio. Jason:             Sure, well, I mean, gold is valued, globally, by just about everybody on this planet. No matter what culture or region that you're from. No matter what demographic you're in, everybody understands the value of gold. Because gold has been the ultimate store of value for, literally, thousands of years. And it has a proven track record in holding its purchasing power.  I mean, in the time, as I said, the dollar, and the pound, and the euro, et cetera had lost 85% of their purchasing power over my lifetime. Gold's purchasing power went up by over 500%. And, in fact, it still buys you what it did 2000 years ago, never mind just 50. So there is nothing that compares with gold, when it comes to store of value.  But, of course, what about the medium of exchange? And a lot of people say, "Well, gold, it's a great store of value, but it's a useless medium of exchange." You can't exactly pop down to your local supplier and buy some goods with your gold. You can't chip that off, they're not going to accept coins, et cetera. Well, actually people need to wake up. There are lots of changes in the space and, certainly, Glint has built technology that allows gold to be used as money. So, for instance, in Glint's case, what we've done is built a kind of payments and trading technology, that effectively allows you to diversify some of your working capital into gold.  So you can have a Euro wallet, a dollar wallet, a pound wallet, and a gold wallet. You can buy as little as a penny, or a million, $10 million worth. We've fractionalized the ownership of that gold, so it's easy to use it as money. And we've even implemented payment instruments that allow people; this is a MasterCard, for instance, linked to a Glint account, that allows me to spend my gold in real time. We're the first company in the world to enable physical gold, real allocated gold, that I own, to be used in payments in real time like that.  But you do have to be careful. A lot of these things; with the cryptocurrencies or with gold, you got to be careful of the nuances, some that can be very important. So when you buy gold, you got to ask yourself, what kind of gold are you buying? Are you buying real gold or are you buying paper gold?  Is the gold that you're buying the physical gold? Is it allocated to you? Do you legally own it? Or is it unallocated gold, which you own but it can be lent out by the custodian. You don't really want that really, do you? Because when the music stops, it might not be there. Or are you buying futures options, derivatives?  Are you buying ETFs? Where you are buying a share in a fund, which may or may not be backed by gold, and I believe, and what we've built Glint around is that you should own allocated gold, that's gold that you own, and it's no one else's liability. But, yes, we've built this system that allows it to be used as everyday money.  And, so, whether it is diversifying your portfolio, your savings. Whether it's allowing some of your ready money to be stored somewhere safe, protecting you from inflation, et cetera. Or whether it's diversifying some of your working capital, your balance sheet, if you're a company, then there are lots of reasons why you might want to own gold. Adam:            So this isn't something that many people are talking about or saying at all. And as you were saying that it made me think of the old days where gold was the standard. Where everybody wanted to get their hands on it. You had the gold rush in San Francisco, California, in the 1800s, and all of those things. How can you have gold as your backing and still be able to spend with it. Even you have your card and the ways you described, but it seems like you can still tank just like everything else, right? Jason:             Well, it's really important to understand that when things are priced in dollars, or pounds, for instance, in the UK, or euros. When they're priced in that fiat currency, then the confidence in those fiat currencies can, of course, go up and down as well. So the confidence in the dollar is going up and down every day, but generally down. So it's up and down, up and down, generally down. That's why its purchasing power is decreasing over time. But gold is just gold, it doesn't change. It's the same thing as it was yesterday, as it was 1000 years ago. It's created when two neutron stars collide in space. So its nature, it cannot be changed, which is why we love it. Because, in my mind, anything that its nature is defined by human being is subject to change or subject to corruption, even if with the best intentions, originally.  So, yes, you've got to understand that, effectively, if you're in gold, but you're working in a foreign currency, then you've got to be aware of those foreign currency fluctuations. But it hasn't tanked in 2000 years. Is it going to tank tomorrow? There's no way it's going to tank tomorrow; I can bet my life on it.  It might drop by 10% or something like that, over time. It's medium monthly variation is half a percent or something like that. It's certainly not as volatile as cryptocurrency. Cryptocurrencies will get there someday, I'm sure over time, and more mass adoption and less affected by whales within the system, et cetera. That's one of the advantages of gold is that it's owned by everybody.  When I say everybody, it's owned by lots of people globally. And from the poorest person on the street, in some parts of the world, to central banks, remember still back their currency, they back their power by holding gold. A lot of them do the U.S. still does, and Russia was building up gold over the last 10 years, so has China.  I don't think there's any coincidence about that. Their actions today are, I'm sure, planned and carefully thought through over the previous decades. And gold-backed money, until relatively recently, I mean, I don't consider myself that old. But 1970 was when I was born and the dollar was backed by gold, then, and it was backed by gold until 1971.  And I know some people might have, as I get older, I start to realize, I start to understand, now, how whole generations of people can be born into scenarios. Where they have no understanding or appreciation of what went just before them and, actually, that can lead to all kinds of challenges. For instance, how many of the audience, who are listening to this podcast, have had a mortgage on a property when interest rates were over 5%? Very few, I'm guessing. And, yet, in my parents' generation, there were interest rates of up to 12%. And lots of people were used to paying mortgages with interest rates at around 5%. But gold-backed money, until 1971, and we didn't come off the gold standard because gold wasn't very good. We came off the gold standard because the very fact that gold was awesome.  Nixon loved gold, but the problem was that they couldn't afford the Vietnam War. They couldn't afford the promises to the electorate, so they were printing money. And De Gaulle, the French president, said, "I think you're printing more dollars than you have gold, guys. So I'll tell you what I'm going to do. I'm going to use my Navy to come into New York, and swap my pallet loads of dollars for gold." And that's what was happening in 1970, 1971, the amount of gold in Fort Knox was going down. And Nixon was like, "We can't lose all our gold."  So they went away to think about it and decided, "Let's just come off the gold standard." And they did that, temporarily, it was supposed to be a temporary window. And, of course, Nixon ended up getting thrown out, and we, live, today with the repercussions, consequences, of that. Which is that we're off the gold standard. Governments, central banks, all over the world, print as much money as they want to their heart's content. And, actually, it ends up being the greatest tax that no one talks about.  Because if you're a saver, if you're a responsible saver, and you're putting your money away. And you don't want to put it at risk in the stock market because a company can go to zero. A fiat currency can go to zero, and they do. So the dollar and the pound have already lost 85% the value, so they're nearly at zero, anyway. Gold never does, that's why people are already attracted to it.  But what seems to have just gotten lost in translation or missed is that everyone's rushed towards creating alternatives based on technology, and dismissing gold. Without realizing that, actually, companies like Glint, and we're not the only ones, there are stablecoins, and stuff like that, based on these types of things, but using technology to make the ultimate form of money, the future. Back to the future of money I'd, maybe, call it. But, certainly, giving everybody their own personal gold standard. And our vision, certainly, is a world where everyone has an equal opportunity to prosper. And we think that bottom up returns to [Inaudible 00:17:38] money is the only way we're going to get to any kind of fair society, and governments are not going to do it.  So private individuals, directors, and companies, we need to take control of our money ourselves. And, I think, this whole explosion in innovation and stuff is just fantastic for people and businesses. You can always rely on people's innovation to come to the rescue. But there are challenges with all these things, as you've intuited. There are problems, aren't there? With implementing these new things into businesses and that people have got to be very careful about what they're doing. They want to think carefully before they jump, I think. Adam:            They do have to think carefully before they jump. And that's a perfect segue thinking about your accounting and finance team. Who would need to take into consideration all of these elements, as they're putting these on the balance sheet. What are some considerations that they do need to take into consideration as they're implementing this? And are there best practices they should think about?  Jason:             Yes, sure, well, I mean, you've got to be thinking about four things. You got to be thinking about the volatility, this is a risk on. If you're cryptocurrencies it's a risk on assets, if it's gold, it has a level of volatility as well. So you got to be thinking about that. You got to be thinking about anti money laundering issues, especially, around cryptocurrencies. Is there a possibility that the cryptocurrency you're bringing in to your business or to your life has been the proceeds of crime? You've got to look at the regulatory issues around tax. Around the nature of money itself. Is it cryptocurrency or gold money? Or is it property? Or is it security? And we've got to look at the systems and processes we've got in the business. Because a lot of those are designed for the incumbent system, not for the new one.  So, yes, we've got to look, very carefully, at those in a bit more detail. So regulatory wise, well, you can lobby governments to make changes and those businesses that might be listening that have some influence there. You got to be talking to government officials about that. Obviously, there's been a lot of change, or concerns about what changes there are in the elections in the U.S. and it's quite obvious that Republicans seem to be a little bit more cryptocurrency friendly, compared to the Democrats. But either way, both parties are going to see some clampdowns on the cryptocurrency industry. My appeal to governments and regulators out there is stop being vague. Businesses and people need regulatory clarity on this. So there are chances that, I think, the problem in the U.S., at the moment, and any government where they don't have a leading majority, is that any crypto-related bills might not get passed. Unless there's bipartisan belief in what needs to get done, and that that's an issue. I don't want to get political about things. But, generally speaking, two parties, when they're so far away from each other, and they can't find a good center, then, actually, nothing gets done. But we do need that clarity. So I appeal to regulators and governments around the world to try and do that. Because, I mean, the SEC chair, Gary Gensler, has said that he believes the majority of cryptocurrencies are securities, and in the UK they see it as property, and I'm sure a lot of your listeners think it's money. So we've got to get to the bottom of that.  But when you're diversifying your balance sheet to include alternative assets, you've got the challenges around your reporting currency, and what effect that might have on your EBTDA. Losses may occur, even if only temporarily. And, of course, when you're doing your audits and your accounts that can lead to quite a misleading view or misleading information for readers of those financial statements.  I mean, you can have a situation where your assets look great, because cryptocurrencies just shot up. Or it could be that the cryptocurrencies just bottomed the day before you had to submit your accounts. So, what is happening? How do you deal with that? Capital gains tax. I see gold as money, I don't see it as an investment, it's just a store of value. And if you said to me, I'm in London, at the moment, so if you said, "Jason, come over to the States, and let's have a week here, let's discuss cryptocurrencies, and alternative currencies, and gold in more detail."  I might buy £10,000 worth of dollars, and I take those dollars, maybe I've got 12 or $13,000. And I come to the U.S. And you get there, and you say to me, "Hey, Jason, don't worry about spending anything, I'm feeling great. I just won the lottery, so I'm paying for everything." And then I come back with my money after a week and the pound is, we've had another Brexit problem, or another prime minister has been elected and another one has resigned, and the pound has plummeted. Suddenly, I now have 17,000, when I exchange my dollars back for pounds, I've got more pounds than I left with there's a capital gain there.  But do I have to report that to the tax authorities et cetera? There's lots of exemptions around using money in relation to tax. But there isn't with cryptocurrencies or with gold. Because the traditional view of gold is it's a bar of gold, it's an investment, traditionally. The views on cryptocurrencies are varied.  So, as we say, some see them as different things. So you got to be careful about that. And you've got to get your advice, in your own region, about how we should be treated. And probably taking the safest approach to say, "Well, we'll assume there has to be a tax on this, a capital gains tax or whatever, we're going to put that money aside." Even if you don't submit it, every region is has got to deal with their own situations there, but you must be cognizant of it. and how do you track all the fees? How do you track the fluctuations in the currency's value? I mean, with cryptocurrencies there can be quite big gas fees, for instance, around some things, and the fees can be different depending on what's going on the network or the block chain is busy at the time, suddenly, those fees are going up. You've got a bit of a difficult situation, where you're trying to manage all of that, manage that volatility, manage the counterparty risk in terms of AML.  So there are a couple of different approaches to this, though, you can take a hands-off approach where you go, "Look, we're going to take any crypto that comes to us as a business. We're not going to actively go out there and buy crypto but what we might do is accept cryptocurrency, in lieu of payments of services or products. You might do that with gold, or you might do that with cryptocurrency. And what you could say, you could choose a vendor and exchange that for you automatically. So you might not even touch the cryptocurrency.  You say, "Look, I still want the currency of my residence, I still want my default currency for my accounts to come into our system. You can pay me in cryptocurrency or gold. But my vendor or exchange that I'm working with will convert that to dollars that comes in and that's obviously the easiest way to deal with this. And, so, nothing really changes for you in the back end.  But if you do want to take that hands-on approach. You got to think about three things, you've got to think about, well, what treasury systems and processes do I have to put in place?  What are my banking relationships going to say about this?  Are they're going to be happy that we're taking on cryptocurrencies about that? And they might not allow me to exchange it and bank it later. And some banks, increasingly, they're more comfortable with things; alternatives, like gold and cryptocurrencies.  But you've got to ask your question, what is my bank's attitude towards this? And then you've got to choose who your vendors are. Are you're going to be working with vendors like exchanges or are you going to be working with your own wallets? There's challenges with both. If you've got your own wallets, how are you managing access to those wallets and security around it? How are you dealing with...  If you're working with an exchange, then, I mean, we've all seen some of the problems, in the last 48 hours, with FTX. I mean, I think, it was Fortune Magazine. I was just in the club, the other day, and I saw a Fortune Magazine and there's the founder of FTX, on the cover, about he's going to be the future, and here we are with the company near collapse.  And, so, who do you choose to work with, if you're working with a vendor? So there's plenty to think about. But it's important that any business remains curious, remains innovative, creative. And you got to start thinking about this and doing this, because you'll find the right solution for your business if you take it seriously. And that can be the difference between success and failure. I mean, with inflation running in some countries that's anywhere between 10 and 80%, at the moment. This is the difference, and we live in a world that's very competitive. And, so, you've got to think out the box. I think, those people who embrace technology, generally speaking, get rewarded in the long term.  Adam:            I agree with you; I think they will. And, like you said, you'd have to know your local regulations like in the U.S. the FASB voted on October 12 that cryptocurrencies are no longer intangible assets, their guidance has changed. So you have to know that, and you have to know how to account for that. And I know IFAC and all those other places are trying to consider how you should view these or account for these. And, so, you have to know what your local regulatory body is doing.  Jason:             Yes, and, as you say, it's changing all the time. So Hong Kong, for instance, had a very strict attitude towards cryptocurrencies. But then what happened is they saw money flowing to Singapore, which had taken a much more relaxed view on cryptocurrencies. And now the tables are turning, Hong Kong has just announced that it wants to be crypto-friendly.  Singapore is starting to tighten up its regulations around that, and even saying that they might restrict it because of the volatility. And in April, here in the UK, the UK Government said that we were going to announce rules to say that stablecoins can be recognized as a valid form of payment. I'm not quite sure what that means. They, obviously, want Britain to become, now, a global hub for crypto asset technology and investment.  But what does that really mean? You're going to accept our taxes in cryptocurrency? And, actually, that's something to mention, being able to pay your employee-related taxes, or your value added taxes, your product taxes.  I think early on, I sold a company to a business. One of the very first electronic barter-based trade currencies, and I was involved in that business for a few months, after the exit. And they had a very simple approach, "Yes, I can get paid in this alternative currency." But, at the end of the day, the government still wants to be paid in their currency. So you just have to, again, account for that.  Adam:            Yes, so as we think about the future, look into our crystal ball. Do you think we're heading toward what the science fiction movies always say, like "I'll pay you 20,000 credits, here you go?" Or are we not going that direction? Do you think we'll get to that point, where everything will be virtual or do you think we'll still have some hard currency that we'll be working with?  Jason:             Well, I think, the term is we always overestimate what can happen in the next five years and underestimate what could happen in the next 20. And, I mean, I was involved in virtual reality, the first time it was called back in the '90s. And I see what's going on with Meta and Facebook and there's no way the virtual reality is going to deliver the kind of returns, and the kind of innovation that is needed. That is reflected with the enthusiasm that people like Facebook have for it and stuff. We're just a million miles away from where we need to be.  And, so, it's the same with cryptocurrencies. For instance, they need to mature, they need to get more mass adoption before their volatility will start to come down. They can be considered valuable stores of value. They're already a good medium of exchange-ish. Transactions are still very high and costly, in most of these cryptocurrencies. So there's still a lot of immaturity there, and I love the enthusiasm for it. And I do think I'm singing from the same hymn sheet, in terms of gold, for instance.  But, I think, long-term there will be lots of progress made and some progress that, maybe, some of the listeners are even thinking about right now. I mean, what's the effect of quantum computing on finance? And you might say, "Well, what's that got to do with finance?" Well, it's got a lot to do with security. The idea that you could have two elements quantumly entangled with each other, and then separated by great distances. I mean, I don't profess to know, I know a tiny amount is very dangerous. But the idea that you could have new security systems based on quantum computing, might mean, for instance, that you can actually tell whether or not this is a real user accessing the system, when the system is on earth and the person is on Mars. So, actually, there's no reason why, for instance, currencies could be intergalactic. And whether that is a fiat system. Whether it is a cryptocurrency system. Whether it is a gold-based system. I don't think matters; I think that the future leads. There's a huge amount of innovation and excitement, for me, as we move forward. I would say, though, fiat currencies all come to an end. They all. There is not one fiat currency that stood the test of time ever. And we can see that they are becoming, right in front of our eyes, worthless.  And, so, I think that there will be an end to the U.S. dollar, the pound, and the euro. But when it will be? They'll probably last a lot longer than we think they ever will. Gold will still be here and, still, I think, a store of value. And with the technologies behind it, it's a tantalizing opportunity to be a fantastic global interstellar currency, based on the kind of technology we could bring forward.  But I do think that block chain and distributed ledger's, in general, can offer a huge amount of increased transparency and trustworthiness, in the long run, to make accountants and finance teams lives much easier.  Adam:            I agree. And, Jason, I just want to thank you, again, for coming on the podcast. It's been great having this conversation. I know we could keep talking for a long time, but thanks for sharing your expertise with us, today.  Jason:             Adam, it's been a pleasure, thank you. Announcer:    This has been Count Me In, IMA's podcast. Providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education. Visit IMA's website at www.ima.net.org. 

Get ready for part two of our insightful ESG (Environmental, Social, and Governance) discussion on the Count Me In podcast. Our expert panel, Douglas, Dan, and Catie, unpack the pressures and fraud risks inherent in ESG reporting, offering invaluable insights gleaned from real-world scenarios. But it's not just about identifying risks; they also provide practical guidance for those embarking on their ESG journey. Learn how to start with what you have, concentrate on materiality, and establish a robust, cross-functional ESG team. Tune in for an essential roadmap to navigate the complexities of ESG reporting in today's business landscape. This is one episode you won't want to miss!Connect with our speakers:Catie: https://www.linkedin.com/in/ctserex/Dan: https://www.linkedin.com/in/dan-mosher-8552519/Doug: https://www.linkedin.com/in/douglas-hileman-fsa-crma-cpea-p-e-6abbb71/Download the reports mentioned into today's podcast:Achieving Effective Internal Control Over Sustainability ReportingManaging Fraud Risks in an Evolving ESG EnvironmentFull Episode Transcript:Adam:            Welcome back to Count Me In. Today we have part two of Unraveling ESG. We're joined, again, by Catie Selex, Douglas Hileman, and Dan Mosher for the completion of their conversation. Now, if you didn't hear part one, I encourage you to pause right now and listen to that first. In today's episode, we explore the challenges and risks of ESG reporting, including the potential for fraud. Our experts delve into the pressures companies face and discuss real-world examples of how well-intentioned sustainability efforts can sometimes lead to misreporting and potential fraud. But it's not all about the pitfalls, they also offer essential guidance to those new to ESG. Emphasizing the importance of starting with existing resources, focusing on materiality, and setting up the dedicated cross-functional ESG team. Don't miss this invaluable conversation, so let's get started. [00:00:55]       < Music > Dan:                Doug, I mentioned the ACFE's Fraud Triangle earlier, and I'm eager to hear some of your perspectives on applying that Fraud Triangle to ESG.  Doug:              Thank you, Dan, it can be done too. It's a familiar construct, and I was fortunate to be an in-house at a Big Four when Sarbanes-Oxley hit. And at the very beginning of designing internal controls and testing internal controls, we had to consider the possibility of fraud.We had to design controls to prevent fraud, in audits we had to detect fraud.  Being an environmental specialist, and then with the IIA coming out with changing their IPPF, their framework, to require testing for fraud. I've been testing for fraud and considering fraud for 20 years, in the environmental space since 2002. It looks a little different for ESG, but not as different as you might think. There is pressure, pressure can be, "We've got to get this report out." "The customer wants this answer." "We have to say, for example, that our products didn't come from Bangladesh, so what the heck? How will they find out?" There's so much pressure. I see that people are involved in ESG, in this non-financial reporting, as an add-on to their jobs. It might be 20% of their job, and it's the 20% between 120 and 140% of what they're supposed to do. People are under, and companies, are under tremendous pressure to put the right answer out there.  They have the opportunity to do so because the controls are not designed, and have not been implemented with the potential for fraud in mind. So where there are weak controls or no controls, the opportunities are there. I see this comes into play, also, when data and information comes from outside the organization. There's this tricky thing where so much of what we do, in ESG, is not only what the organization controls but what the organization can influence. There are some challenges there, how do you control what you don't control?  So the opportunity is there because the controls can be weak or nonexistent. And the rationalization can be, "Well, everybody does it."  Or "It's not about money, it's about prestige." "It's not really this, we want the award." We've seen, for example, there's a magazine, an organization, that rates colleges, the 10 best colleges in each thing. And we've started to see, in recent years, where the colleges are even fudging the information to get the prestige of being in that award. That may have secondary effects for how many people go to that college or what they're willing to pay for tuition, but that's fraud.  In my book, if you submit data and information that is incorrect, or inaccurate, or misleading, with the intent to deceive at the expense of others. Especially if that turns into actual or potential financial gain, I call that fraud. So that applies on all three sides of the triangle. It's just a matter of thinking about this ESG and non-financial world and how that can happen. Dan:                Excellent, Doug. Yes, maybe, just to add a couple of extra points around those pressures and incentives. Today we are seeing that there is incentive compensation for certain executives that is linked to various ESG measures. If you think about that and the opportunity for management override of certain controls that are out there, that's a great incentive.  If you're going to get paid a bigger bonus because of greater ESG metrics, and your ESG, for example, your emissions information is held in Excel spreadsheet, which in many cases that is the case. I saw a survey, not so long ago, of more than a thousand executives saying that, I think, it was 86% of them had their emissions data just sitting in a spreadsheet. And if you could change that with a few keystrokes, at the executive level, to boost your bonus, someone might do that. Other things I think of are from an incentive or pressure standpoint. Things around ESG-linked bonds or credits where there are a key performance indicators and you're required to maintain those metrics, to maintain certain interest rates or payment on your bond. Those things are out there and they're going to influence some portion of those that are held to them. Catie, maybe, you have some other thoughts around this as well? Catie:              Yes, Dan, so one of the things that we're seeing in ESG, especially because people are so compelled to make great strides on their data and to make progress towards their targets, in a very quick manner, is there's an emerging market of solutions that some are absolutely legitimate and there's good actors, but they're also bad actors. So one real-life example of this happening is the Vatican used a third party to preserve a forest area, as part of its carbon offset effort and to help move towards its emissions reductions targets. So, in this instance, the Vatican thought that it had protected an area of Hungarian Forest as part of that reductions plan, but that actually never happened.So while there were good intentions to reduce the Vatican's emissions footprint, ultimately, that desire left them to susceptible to fraud by this third party. So that's something else to think about is as you're incorporating other entities, that are outside of your organizational boundaries to help you reach these targets, are they genuine good actors?  Have you conducted the due diligence to ensure that they're going to support you in getting to those targets, as opposed to hinder or even mislead you, which could lead to misreporting on your part? And, Dan, I wanted to get back to that pressure element. A lot of the clients that we're working with are in those early stages of ESG reporting, and are just getting their program started. So, Dan, Doug, and I am happy to contribute, as well, but what are some guidance that we can give to listeners? In terms of for those who are at ground zero and need to start reporting, and disclosing, and to ease some of the pressure that they're experiencing from stakeholders and regulators. What are some ways that they can approach this? What are some tools that they can use to mitigate associated risks?  Dan:                I'll go ahead and start. So I refer back to some of those frameworks, that you have mentioned, Catie, as a starting point. In terms of the kinds of disclosures that an organization might make in a certain business sector. I think that they should be taking stock of the various channels in which they might be reporting that information, and looking at the various kinds of scenarios, in which the information might be incomplete or inaccurate. So even just thinking about those processes will get them on a good path forward.  I think that you probably want to think about starting fairly small, with the kinds of disclosures, and build upon those as your maturity from an ESG perspective grows. Doug, what are your thoughts? Doug:              For companies just starting out, or in the early stages, what I would say to them is, first, just recognize this is not a hobby. This is not a nice to do, this is a business imperative and it is not going away. Put the right people on it and devote resources to it, who can really get things moving. Another thing I would say is, one of my phrases, is begin with what you've got because you really can't begin with anything else. A gap assessment is a really good idea. What are the requirements that are expected from the general capital markets?  What are the questions you're getting from impact investors and customers, where you're getting that pull and you're expected to provide something? Well, what is it you have? Companies may have a little more information than they think they have. Because much of this information is already being collected to achieve regulatory compliance obligations, with let's say the EPA, or with OSHA, or the Department of Labor. Is that data and information fit for purpose or can it be modified a little bit, to meet the expectations of the stakeholders who want this kind of reporting and disclosures? Another point I would say, we've touched upon the cross-functional team. This cannot be the responsibility of any one person. This is a team effort because this non-financial information touches every part of your business internally, and it touches many parts of your business externally. With your providers of capital, your banks, your insurance companies, your customers. So all the people who engage in external relations with folks outside the company, it has to include those.  One tip I would say is climate change is the single biggest issue of our time and climate change and climate change reporting, greenhouse gas emissions reporting, is expected of everybody. So climate change has got to be on your agenda. There is some specialized expertise that comes with that.  I would suggest that climate change has even its own team and its own work streams. I think supporting that when the ISSB put out their two exposure drafts. They had one for all sustainability reporting disclosures and one for climate change risk and exposures. So you've got to address climate change. And, finally, I would say I put in a shameless plug for using the COSO Framework, that if the data is going to be complete. If it's going to be accurate, if it's going to be verifiable if you're going to have the right people with access to it and only the right people with access to this data. There's nowhere better to start than that COSO Internal Controls Framework. And even backing up that COSO Enterprise Risk Management Framework to lead into materiality. And to lead into what are the issues where we should be reporting on and focus our efforts.  To use an extreme example, if you're a Chevron you're not going to bet the company on recycling paper. So what are the issues that matter to you as a company? Where you invest your time, your resources, your people, and your initiatives on improving performance.  Catie:              And, Doug, you brought up a great point when it comes to materiality, and I want to make sure that for our listeners, they know that when it comes to ESG and sustainability, materiality is separate and distinct from the concept of materiality under federal state securities law, as well as GAAP. And that's because items that are material to ESG they're not, necessarily, the same as those that are material under securities law or GAAP.  So one of the ways that we help clients and, especially, our year zero clients who are trying to uncover what is material to their company. We always recommend starting with a materiality assessment, and ESG strategy and policy development. This is going to help you set your own guardrails so that you don't overextend or overcommit on ESG. Doug mentioned that climate change is becoming one of those topics, that companies absolutely need to have resources and teams dedicated to. And I'm seeing that with most of my clients, climate, even if it's not on the horizon immediately, it's coming.  And, so, it's something that you will need to consider and continue to refresh what's material to you. So having those assessments, we recommend every two to three years because material topics for ESG are not stagnant. You don't select them, and then that's what you have for the entirety of your company's lifespan. They change because society changes, the political environment changes, and the actual environment changes. So you want to make sure that you're staying on top of and looking ahead to what those risks are.  So that you've got the data, mechanisms, and the internal control processes in place, to be able to have that data, have those baselines that you need. And then as you're planning out your ESG programming, set realistic goals and targets. So that you're not overextending yourself and that you are setting commitments that you know that you can achieve, and you're not falling victim to the fraud triangle in an attempt to achieve those commitments that you set for yourself. Dan:                Doug, I know you talked a bit about the great importance of climate change and emissions reporting. I did want to give our listeners some food for thought around emissions reporting. If you think about how some of that emissions reporting takes place, it's a calculation. So, for example, I've been in touch with a large organization. They calculate some of their emissions, taking their rented square footage of office space and applying the relevant coefficient to it, to come up with an estimate of their emissions.  I asked the question, well, "You have a number of offices across the country. What would happen if you, accidentally, forgot the Dallas office? Would someone catch it?" And the answer was, "Not necessarily." And, so, the care and the completeness, and the extra effort to make sure you have that completeness, it can be challenging, but I think it's completely necessary. Because if something could be forgotten accidentally, it could be forgotten on purpose, and if it's forgotten on purpose that's contributing to fraud.  Catie:              And to add to that point, Dan, some of the frameworks, specific to climate, already have built-in mechanisms to help you guard against that fraud. So, for instance, The Greenhouse Gas Protocols Corporate Standard sets guidelines for when to recalculate your corporate base year emissions. Because companies are setting their targets and their reduction strategies based upon that base year calculation. And, so, there are some particularities in terms of, for instance, if your company goes through an acquisition and your footprint goes by X percent, that is what triggers a base year recalculation for your emissions metrics specifically. And, so, that's a policy example. That's an example of a policy that you would want to have in place for some of these metrics.  So that as your company continues to grow, and circumstances change, and your footprint either shrinks or increases, based upon your operational size. You'll want to have policies in place so that you know when to recalculate your base year, so that you're continuing to report complete and accurate data.  Doug:              I think carbon emissions reporting, encapsulates everything we've discussed on this podcast and everything that's in both of our reports, the COSO Report and ACFE Report. And I think we could probably do a separate podcast on that. I'd encourage our listeners, many of whom are accountants, to read the Greenhouse Gas Protocol and become familiar with it.  There are operational and technical people doing it, but at its heart it really is an accounting protocol. We've discussed how you put together data and information to meet different purposes. I've worked with clients who get called upon to publish a greenhouse gas report, greenhouse gas emissions, using an operational control basis. Using the equity share basis, using the financial… So there's the same data that needs to be sliced and diced three different ways and for different reporting periods. Catie brings up the good point that there are protocols to restate or to correct errors when identified, or to account for forgotten facilities. There are uncertainties documented in it because many of these emissions that are reported involve estimates. What if you get better estimates? Do you apply that to this reporting period or do you retroactively do that and report it? Much of this involves judgment. What is a material change? So maybe you apply materiality in ways that you would apply it elsewhere or differently. All this has to be documented and the possibility of fraud starts to creep in, when there is the pressure to say, "We are on target for getting carbon neutral by 2030, in accordance with senior management's directives." So they can get their compensation bonus, and we can stay in that ESG-preferred trading fund, and we can get our low-interest rate from the bank or decline from that. If you understand, if accountants, and business folks, and operations, and environmental people take a good look at the Greenhouse Gas Protocol and you overlay that with the COSO Internal Control Framework, and you overlay that with that terrific publication on ESG fraud, from the ACFE. A lot of what we're saying will start to make sense and you will understand where you can contribute to more effective and more efficient reporting, and prevention, and detection, of fraud.  Catie:              So we know that, especially, because ESG is still an emerging discipline and there's different interpretations of data, and some of the data points themselves are evolving. So what do you say to those who are concerned about, unintentionally, misreporting data. And realizing two to three years down the road, "Oops, we made a mistake." How should they approach that in the future?  Doug:              Well, that's a great question, Catie, and we see that all the time. And I predict we will see it a lot more as this field matures, and as companies mature their processes and controls, and as more people take a look at it, both, assurance providers, investors, and the like, we're going to see more of that. And it's understandable that everybody will be handwringing and so afraid of making a mistake. And I go back to what we said 20 years ago, at the beginning of Sarbanes-Oxley. I was on many financial audit teams supporting them as ESG specialist for asset retirement obligations, environmental liabilities. And, well, we don't know the right number. We don't know if it's going to happen, and my advice, at the time, as a non-CPA, just an engineer and auditor is to say, "Well, in good faith, read, interpret what is required, develop a process, document the process, and then follow the process and document that you followed the process and the output from that process." That's what goes on the line item in your financial reporting.  If somebody determines that that was not correct or it can be improved. Maybe it's an internal suggestion, maybe it's from an auditor, maybe it's from an enforcement authority. It doesn't really matter how you discover something that needs to be changed. At least you can produce what it was you did and show that you were consistent with the design. The operation was consistent with the design. If you need to change it later, then change it later. Then comes the question, do we change it from this point going forward or do we have to do an adjustment for prior reporting periods? So that can be part of your process and your criteria. Set a threshold, a materiality threshold for that. Develop a process for how teams consider that and who decides yes or no. It's really using processes that you already have, and apply those for non-financial reporting.  Catie:              And just to jump in there from the ESG perspective, Doug, I think, not every year will be one marked by progress towards your targets. There's a million different circumstances that can affect progression on your commitments. And, so, again, going back to being transparent and communicating challenges and setbacks to your stakeholders, goes a long way in the ESG space. In terms of them continuing to have faith that you are reporting these disclosures, as they go along, and highlighting where you are experiencing those challenges and setbacks. Doug:              That's right.  Dan:                One part of the ACFE's Fraud Triangle is rationalization, and I think that this longer time horizon that Catie was just pointing to, actually, causes some rationalization to happen. Because there's a longer time horizon, someone might say to themselves, "Well, I can catch up next year.Let me fudge the number a little bit this year, and show some progress, and I will make it all better next year." And, so, there is something particular to ESG with that longer time horizon for those commitments being made around, "I'm going to be net zero by such and such a date. Well, that's a long time from now, let me just show that I have progression every year and hope that I can catch up in reality." Dan:                I maintain that non-financial reporting has a couple of attributes that are a little different from financial reporting, or at least they occur in greater proportion. Two of those attributes are much more narrative in non-financial disclosures, descriptions of processes, and also some forward-looking statements. Companies are encouraged to announce goals and targets, which sets the stage for reporting in future reporting periods on their progress to the goals and targets.  One of the things that is starting to look a little different, companies will say, "We are committed to meeting our climate goals for 2040." Where they make some grand, forward-looking narrative statements, and talking to some folks who are reviewing that, and even some of the external auditors, they're comparing those forward-looking narrative statements to where the companies are spending their money.  So if you're making statements and disclosures that are these grand, forward-looking projections, and the auditors see you're spending $7, a year, towards meeting that goal. Well, is that statement itself? Is that disclosure? Is that negligent?  Is that sloppy, or is that in order to get into an ESG fund, or to attract Helen, in ways? Is that tiptoeing into fraud?  I think the dust is yet to settle on that, but the topic is coming up. Dan:                I think it's a great point, Doug, and I'm sure that there are a host of attorneys out there who will, gladly, be spending time to figure out when the line has crossed into fraud. Catie:              And I will add to that, we're seeing a lot of companies set 2040 goals. And just for context, that comes out of the Paris Agreement, saying that the global target for net zero needs to be… Hang on, Adam, let me pause and make sure that I don't misstate this. So part of that Paris Agreement was this global recognition that net zero needs to happen by 2040.  And, so, that's why you're seeing that number come up in a lot of different corporate targets, when it comes to their net zero goals. That said, there is still a lot of work that needs to be done, at the company level, in order to achieve that. And there are things that are beyond your control.  So the different breakthrough technologies that are needed in order to accelerate transitioning to a decarbonized economy. There's still a lot of research being done in terms of the electrical grid and the different green technologies that can generate energy, to help reduce that carbon footprint. So I urge caution in terms of setting your goals because it needs to be, again, coming back to the point, it needs to be realistic and something that you think you can achieve. So one thing that we encourage our companies to do is it's great to have a moonshot goal, and if 2040 is your moonshot goal, then that's awesome. But setting those intermediary milestones to hold yourself accountable, to that moonshot goal, is something we really encourage our clients to do.  So that could be as simple as setting your baseline year for Scope 1 and 2 emissions. So that you have a complete understanding of your carbon footprint. And then from there you can understand what are those emission sources that we have? What can we do, that's in our power, to reduce those emissions? Are there simple process changes that can reduce our footprint?  So it's important, again, just go back to what you have already, what you know, and work from there. And there's no shame in having a really great moonshot goal if it's 2040 or if it's not 2040. But I think that setting those intermediary goals is going to be what really helps you to not fall susceptible to the fraud triangle.  Dan:                I think, we've had a really good conversation here and we've covered a lot of ground. Everything from visibility into your supply chain and the challenges raised by that. All of the complexities around data quality for emissions reporting and other sorts of reporting. I really have enjoyed this conversation immensely.  Doug:              As have I, it was a privilege. I hope our listeners enjoyed it as much as we enjoyed having the conversation. Catie:              Yes, thank you to Dan and Doug for this discussion. I really enjoyed chatting with you and, hopefully, the listeners will get some useful information out of this that they can take back to their organizations, and start to implement some of those tools and mechanisms to help them guard against fraud. [00:29:20]       < Outro > Announcer:    This has been Count Me In, IMA's podcast. Providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in, for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

As highlighted in the recent COSO publication on Internal Controls over Sustainability Reporting, good governance and systems for sustainable business activities and ESG reporting require attention to potential risks around fraud and greenwashing.  Reflecting Grant Thornton’s recent report on control activities related to these risks, join us as we take a dive deep into the world of Environmental, Social, and Governance (ESG) in business with our latest episode of the 'Count Me In' podcast. Hosted by a panel of experts, which includes Catie Serex, Douglas Hileman and Dan Mosher, our podcast uncovers the truth behind ESG, its importance in today's business world, the challenges it presents, and importantly, its potential role in fraudulent activities. Tune in for a fascinating conversation on ESG reporting, corporate purpose, sustainability, and the latest trends affecting investors, employees, and stakeholders alike. Don't miss this chance to stay informed and ahead of the curve in the ever-evolving world of business.Connect with our speakers:Catie: https://www.linkedin.com/in/ctserex/ Dan: https://www.linkedin.com/in/dan-mosher-8552519/Doug: https://www.linkedin.com/in/douglas-hileman-fsa-crma-cpea-p-e-6abbb71/Download the reports mentioned into today's podcast:Achieving Effective Internal Control Over Sustainability ReportingManaging Fraud Risks in an Evolving ESG EnvironmentFull Episode Transcript:Adam:            Hello, and welcome back to another enlightening episode of Count Me In. I'm your host, Adam Larson, and today we're diving deep into the complexities of Environmental, Social, and Governance, ESG, with a distinguished panel of experts. We're joined by Douglas Hileman, an experienced sustainability consultant, with over three decades of experience in environmental management systems, and internal controls.  Alongside him, we have Dan Mosher, a seasoned professional who excels in helping businesses navigate the complexities of sustainability and environmental risks. Last but not least, we welcome Catie Serex. A leader in environmental, health, and safety, auditing and management who assists businesses in integrating sustainable and socially responsible practices.  Today's discussion will delve into the importance of ESG, the challenges businesses face in managing ESG data, and the potential risk of fraud in ESG reporting. Here we go, let's listen in together. [00:01:00]       < Music > Doug:              And one of the things that we might kick off is with a very basic question of what is ESG? Dan, when people ask you this, how do you answer? Dan:                Well, it really is a big umbrella, and I'll ask for some help from Catie in this regard. But ESG stands for Environmental, Social, and Governance. And, so, lots of things under that environmental area. Everything from waste management and air quality, climate change. From a social perspective, it could be your human capital management, health and safety matters. Governance, I think of anticorruption, data risks, and the like. So it really is a broad title when we say ESG. Catie, do you have some things you'd like to add to that comment? Catie:              Yes, Dan, you definitely covered the gamut as far as some of the phrasings and the terminology, and really the topics that fall under that ESG umbrella. What I would want to add is that ESG is certainly one of the buzziest words in business today. But you might not know that ESG is, very simply, the newest iteration of concepts you've likely known for a long time. It's been previously known as corporate purpose, sustainability, even philanthropy.  But what differentiates ESG from these previous versions is that it now represents the closest alignment, to date, of business operations, so think about your tangible assets. To those intangible elements of business that drive value. And, in this case, I'm referring to things like customer loyalty, labor environments, community engagement support. And because of this connection, ESG is moving from a nice-to-have to a need-to-have for companies, but also their investors, their customers, and other key stakeholders like their employees. Doug:              I also think of ESG as a convenient taxonomy for all things non-financial. Many people have published those pillars or the word clouds that's in the ACFE report, and what topic goes where. For financial reporting, we know where sales goes and we know where EBITDA goes. We know where those are in a format and how to put the data and information together for clarity and reporting. For all things non-financial, it's just such a sprawling array of topics that ESG serves for one reason, in one way, as just simply a taxonomy. And there are some issues, such as climate change, like Dan mentioned, that really transcend more than one category, if you will. But for purposes of just where do you find it, and how do you manage it, and it can just serve as a taxonomy. Catie, to your point, on how to organize some processes, some controls, some recordings to understand what the organization is doing. Dan:                And I'd be interested in hearing your thoughts on the various channels in which this information is being put out there in the public. Catie, maybe you have some thoughts around the wide scope of that. Catie:              Yes, so in terms of the reporting side of things and getting to the nuts and bolts of what, I'm sure our listeners are interested in, in terms of, what am I on the hook for? There are a lot of reporting frameworks out there that are guiding folks. And I know that that's been a point of confusion for people is understanding, there are all these different acronyms out there. That I can report to like SASB, or the Global Reporting Initiative, GRI, Task Force for Climate-Related Financial Disclosures or TCFD. There are a lot of frameworks out there, but the field is narrowing.  So some of the communication that we've been seeing from these wider umbrella frameworks, are that they are working together to consolidate. To make things a little bit more straightforward, and to make things a little bit more uniform across the reporting landscape. But that's currently in progress, and this is just a result of this being not in nascent stages, but still in its growth period, and really honing down what are the things that shareholders, regulators, and such need to see when it comes to these ESG disclosures. Dan:                And I know that Doug has been on the front line when things are misreported or omitted, and I'd love to hear some of his worst stories. Doug:              Thank you, Dan. The question about reporting channels is a very good one, and Catie brought up several things that are happening in reporting to general capital markets. I also observe that there are other channels for reporting, including impact investors who may be interested in one particular topic. The general purpose capital reporting takes in one tranche, if you will, of topics that need to come external from an organization, a company.  There are other investors who are interested, let's say, in human rights, or in product conformity, or in diversity, or in commitment to climate, and they want more information about those topics. So you may get information from investor groups or analyst groups, and that's a type of report.  Another channel of reporting that I see is B2B reporting. The customers, and business partners, and banks, joint venture participants, are looking more into non-financial risk management. Non-financial performance and alignment, which is ESG. So before entering business relationships, and even during business relationships up and down the value chain, there's also ESG reporting that happens there.  It is starting to align in some ways that they're asking questions about the same topics, but the questions themselves can be different. And, in many cases, the reporting, the demand for reporting has outpaced companies' abilities to report on the data and information. So that pull has created a bit of a vacuum. And many companies are scrambling to come up with processes, systems, and controls so they can generate the data and information that these stakeholders are expecting in terms of reporting. Catie:              Doug, just to jump in there, from a client perspective, we are seeing that a lot of our clients are getting, especially, those B2B requests from either their suppliers or their downstream supply chain vendors. And the way that we're seeing that manifest is a lot of these larger companies are looking at their supply chain. If you think about greenhouse gas emissions, they're looking at their Scope 3 emissions, which is all value chain.  And, so, they're sending requests to clients like ours that are asking, "What are your Scope 1 and 2 emissions? Because we need to report that." We are seeing clients feeling the pressure to respond to that, to continue to be part of those wider supply chains.  And, so, they're coming to us asking for assistance in figuring out what those ESG metrics are and being able to respond in complete and accurate ways. So that they can continue to have those key customers that are asking for that information. Dan:                Yes, and I'd like to pick up on that point, too, and Catie was just touching on it. I think some of the key challenges are, for businesses today, what is the providence of their ESG data?  What is the confidence they have over the accuracy and completeness of it?  And what is the integrity and quality of that data as it travels along its life cycle, from where it started to where it was reported? And has it maintained that integrity all along? Because bringing this back to our main topic of fraud, there are many pressures and incentives that might have someone misstate or omit information in their ESG reporting. Doug:              I'd like to pick up on a topic that Catie discussed on climate change and greenhouse gas emissions. It does, inherently, involve a complex web of data from different sources, including suppliers. And companies may be asked to produce or report the greenhouse gas emissions for themselves, as a company, on Scope 1 and Scope 2. I hope our listeners know what that means. Or on a part of Scope 3, or their carbon emissions as a company, or their carbon emissions in a particular country or state, or their carbon emissions for the products they manufacture for a certain customer.  So those are different ways to slice and dice much of the same data. And it all goes back, I'll put in a plug here for the COSO report mapping the internal control framework to ESG. That can be applied to anything, any topic, any company, including, for example, greenhouse gas emissions. In terms of fraud, there can be a difference between just sloppy, or just unavailability of data and willful reporting of incorrect or misleading data.  For example, to get preferred treatment at a customer, or to get preferred inclusion in an ESG index fund, or to get a reduction on interest rate from a line of credit, from a financial institution that's looking for green investments. So we're still seeing an increase in awareness of the fact where, "Well, we can just report this because nobody cares." Or, "Well, it's not regulatory, so we'll just let it go." And willful deceit in order to get a benefit at the expense of other competitors in these areas, which goes into the fraud bucket. That ACFE and Grant Thornton touched upon in that report. Dan:                Yes, thank you, Doug. The report that Doug is referring to is a joint publication of the Association of Certified Fraud Examiners and Grant Thornton called Managing Fraud Risks in an Evolving ESG Environment. You can get it from our website and from the ACFE, and within that, we did develop an ESG fraud taxonomy.  It encompasses both some of the traditional areas of fraud that have always been there. Corruption, asset misappropriation, and financial statement fraud. And there are certainly ways in which ESG fraud manifests itself under each of those headings.  To that traditional fraud tree we have added an additional area of non-financial reporting fraud, which Doug was alluding to. And the things that might happen under there, there could be false labeling or advertising. Think of things like declarations of saying that it's "Dolphin-free tuna" that has certainly been an area of litigation in the past. I'm thinking about false disclosures or representations, and that might be along the B2B relationships. Where you are omitting information or misstating information to a company that you are a supplier to. Lots of ways that things can be contorted, and misrepresented, and misstated, omitted, and if it is done intentionally, then we're going to consider it fraud. Doug:              Dan, I can't say enough good things about the report that came out and, certainly, my hat is off to you, and Catie, and everybody who contributed to that. I know that was a massive effort. What I think is so elegant about that report is that many of our listeners struggle with how to get their arms around ESG, this sprawling issue is so new, it's so different.  The report begins with a construct that's familiar to everybody who deals with fraud, that famous ACFE fraud tree. And the report adds a leaf, if you will, if you look at that tree at the bottom row, that provides an ESG example for the fraud tree as everybody knows it. And then it was very elegant how you added that branch, if you will, for the ESG, the non-financial reporting with nine different twigs to describe a taxonomy there, and then the leaves with the examples, it was really well done.  So anybody familiar with fraud and the fraud tree. Anybody who has been involved in developing procedures to prevent fraud or to detect fraud on the audit side, you can just use that reference document and get pretty close to how you think about ESG fraud to prevent it and detect it.  Another thing I would observe that the human rights, no product was made with child labor. Non-financial reporting and compliance exists in a lot of places out there, and it can be possible, it can be easy for stakeholders to compare information that arises from different reporting channels for consistency. For example, Dan mentioned one of the claims could be, "None of our products use forced labor".  In the U.S. there's a law called the The Uyghur Forced Labor Prevention Act. That has the rebuttable presumption that products made from a certain area, in China, if you cannot prove that those products were made absent forced labor, the assumption is that they were made with forced labor. And the Customs and Border Protection is seizing products at the docks before they come into the country, and waiting on companies to provide evidence that the products are forced-labor-free.  So if you have claims on your website, or on products, or in contract documents that they're forced labor free, and the Customs and Border Protection is reporting that your goods are being held and not allowed into the country. There is an inconsistency there that can be embarrassing, at a minimum, to companies. And it can cost the company sales, customers, and reputational damage if it turns out that those claims cannot be supported. Dan:                Yes, so just picking up on what Doug was talking with The Uyghur Forced Labor Prevention Act, this is a big stick for the government in they have a presumption of guilt, so to say. That if they suspect that a good has any raw material or input within it because it is in whole or in part of your good that's being imported, is suspected of having forced labor in it, and that means every tier of your supply chain down to the raw material or seed, if it's an agricultural product. If there is a suspicion that it is tainted by forced labor, it will not be allowed into the country unless you can prove otherwise. And, I think, it's going to become, increasingly, challenging for companies to know their supply chain inside and out. And from a fraud perspective, whether any part of that supply chain is deceiving the rest of the supply chain on whether or not it's tainted by forced labor.  I was just reading over the holidays, there is a tremendous report that came out from Sheffield Hallam University, in the UK, around the various risks in the auto industry for being tainted by forced labor in the production of raw materials. it's really a very difficult area, and it is something that our clients are coming to us, asking for help around.  Dan:                Catie, do you have some other thoughts around the regulatory environment in which this is probably just one small piece? Catie:              Yes, Dan and Doug, you both brought up a great point of there are current existing regulations that apply to certain areas of ESG. But what we're seeing is a global movement towards more overarching regulations across different jurisdictions. So, for instance, last year, the European Union approved the Corporate Sustainability Reporting Directive Regulation, also called CSRD, and that sets reporting standards for entities that meet certain EU reporting thresholds.  In the UK, there IS BEIS, which is focused on climate-related disclosures for entities that operate in the UK. And then, of course, for our U.S. listeners, I'm sure you all have heard about the coming SEC final rule when it comes to climate disclosures. We anticipate that being finalized as early as April of this year. But all that to say that the regulatory environment, itself, from an ESG perspective, there is a growing recognition that there needs to be standards that companies adhere to. So that there is comparability across the landscape when it comes to ESG data. Because it is hard for whoever is looking at this data to discern what certain data points may mean because they may be defined differently.  So these standards are helping to create an environment that is more accountable and more comparable which, hopefully, will help clarify some things and clarify the way that you go about reporting. That said, even though some of those regulations are very early stage or haven't been released, yet, there are already consequences for misreporting.  So we saw last year, or in the past couple of years, that Goldman Sachs was fined $4 million and BNY Mellon was fined $1.5 million for what were considering material misstatements. And in the future, we see that more frequent consequences could be around the corner. But I can't speak to what that looks like just, yet. Dan, do you have any experience, or Doug, in terms of any additional consequences that you're seeing for misreporting of ESG data? Dan:                Yes, well, for me, as you said, there are consequences from misstating, publicly, the information. There are just a ton of business consequences of misstating the information. So, for example, I myself was involved in an investigation in which there was a licensor of images for the front of T-shirts and the like. There was a requirement that none of the production would take place in Bangladesh after the tragedy in 2013, in which a building collapsed, killing more than 1000 apparel workers.  And, so, there was a requirement that no production take place in Bangladesh, and there was wide-scale deception on that point. Such that there was a lot of production going on in Bangladesh, but it was being misreported to the licensor as being produced in India or in other jurisdictions throughout Asia. That finding, in the investigation that we carried out, was the subject of whether or not a billion-dollar license would go forward or not. Doug:              I can see several potential risks or consequences for misreporting or misleading content and reporting, and they vary according to the reporting channel. For example, there is ESG content in financial statements, in income statements and balance sheets. There are reserve estimates for contingent environmental liabilities.  Something that's a little newer is asset values for Emission Reduction Credits or expected costs in the future for Emission Reduction Credits, if that's part of a company's strategy for reducing greenhouse gas emissions. Those have a vintage and the value depends on the vintage. If those are, knowingly, misstated, you're subject to all the things that come with that in financial reporting, disclosure controls, and procedures, and the like. For misrepresentation and misreporting in the Form 10-K, the analysts and the investors are using this to make investment decisions. There are shareholders who are quite happy to file proxy filings or to file suit by claiming to be misled for the content in there. Some of those are starting to see the light of day or to get quietly settled. There was an instance of a major European bank, an employee blowing a whistle, publicly, saying that their screening process for companies to include in an ESG index fund was just not very good or, maybe, a sham.  So there's the reputational damage that can be a hit to a company and the market cap for many companies, the reputation, the intangible value, exceeds the value of PP and E - Plant Property and Equipment. So intangible value and brand value is something to watch out for too and that can take a hit, with misrepresentation or loss of reputation in ESG and non-financial matters. Catie:              And, Doug, just to piggyback on that point, there's the financial disclosure side of that, but there's also, as we talked about, the intangible side of that. So customers are increasingly wanting to purchase sustainably made goods, and engage with companies that align with their own personal moral values and beliefs.  And, so, when they learn that whether it's a good that's claiming to be sustainably made is actually unsustainable, you could lose members of your customer base. At times it inspires boycotts and protests and, especially, in the age of digital media, just imagine someone telling their community about their experience, and that going on Twitter, or TikTok, or something of that nature.  Those are some of the risks that we're seeing from not a regulatory penalty approach. But also there are consequences when it comes to your customer base, the value of your brand, and your brand reputation. Doug:              We've discussed a lot of different data, a lot of different stakeholders, a lot of different needs. So how do companies manage this kind of reporting. When everybody wants something different. There are different ways to slice and dice. How does a company get their arms around this and make sure that it's right? Catie:              Yes, that's a great question, Doug. So as I said before, there are a lot of different frameworks out there. But they are working to consolidate the frameworks and to consolidate the data expectations of those frameworks.  From what I'm seeing, it appears that SASB, GRI, and TCFD, all of which I previously mentioned, are emerging as the big three of ESG data disclosure frameworks. And it's important that our listeners understand that while these frameworks are not required for disclosure, they can help guide your reporting. And, ultimately, they can help your company be more aware of any potential fraud risks and avoid being susceptible to associated fraud with those activities and reporting.  Of course, the frameworks, themselves, are not mandatory for disclosure. They are, as I said, guidelines and we talked, previously, about the different regulations that are emerging. I think the thing that's important to know here is that some of these frameworks are being utilized to inform those regulations. So we know that the SEC climate disclosure draws heavily from TCFD reporting framework.  And, so, some of our clients are asking us to conduct TCFD reporting gap analysis to help them prepare for those upcoming SEC-required disclosures. We have clients who are asking us to do assurance readiness services because they know that they will fall in that year one reporting group, the large accelerated filers for the SEC.  And, so, having us test their existing processes, internal controls, things of that nature, and validate that their data is complete and accurate is something that they're doing to prepare for the upcoming regulatory framework. So the way to think about those frameworks is that it's a helpful way for you to organize your disclosures in anticipation of future reporting requirements.  Dan, do you have any thoughts from the fraud risk perspective of how those frameworks can usually help you. In terms of guarding against any potential misreporting or intentional or unintentional? Dan:                Yes, so when I think about this, I usually do go back to the ACFE's Fraud Triangle, thinking about incentives and pressures, the opportunities for fraud, and the rationalizations one might apply to committing those frauds. So when I think about reporting what is the role of that report?  Is it going to a regulator?  Is it going into a corporate social responsibility or a marketing publication? All of those bear different kinds of risks. So in terms of on this reporting topic, that people and companies should be thinking about taking an inventory of all the ways in which that ESG information is going out to the public, across those different channels. And ensuring that as they're building up their capabilities and infrastructure to maintain good data quality, that it is also ensuring consistency across all of those reporting channels.  What I anticipate, and I think we're starting to see it, is that there will be cases where the same information is reported in one channel, but is inconsistent with how it was reported in another channel, and that will be held against the company. You should not be finding yourself saying one thing to the government and something else in a publication. Doug:              Dan, I absolutely agree with that. I would say to this question, it comes back to a familiar trilogy that we hear as the answer to so many questions, and that is people, process, and technology. And I'll start at the end and work my way back, there are many vendors offering technology fixes and even companies, in-house, building technology fixes to gather and report data.  But the data and the information is only as good as the process it took to come up with the data. You can automate the wrong process and just get the wrong answer faster. So you back up to the process and say, "Well, since this non-financial information originates in so many parts of the company, and even from other companies, suppliers, customers, business partners, and the like. What is the process to get them?" There are also challenges I see on reporting periods. Governments, like EPA, may have an annual reporting process. There are companies with a non-calendar fiscal year, who need to report some of this on a fiscal year basis. So where are the reporting periods? What is the process to collect information and report to a state agency, to a stakeholder, to a customer? So those processes need to be nailed down, and that's where that wonderful COSO internal controls framework comes in. Just follow that and apply it as it's appropriate. And because that data and information comes from so many different sources, I encourage people to have the right people involved.  If companies establish a cross-functional team and get folks from all the places who provide this information. Real estate, operations, safety, procurement, R&D if they understand their roles and responsibilities in collecting this information to enable the kind of reporting that Catie has mentioned and others, then that goes a long way to making the process more effective and more efficient. Dan:                Yes, and I would like to add on to what Doug was saying. That in terms of the fact that this information is coming from different parts of organizations, that haven't necessarily undergone third-party assurance procedures. That this is a transition period here where, I think, a broader spectrum of people, within an organization, are going to be changing their mindset around the accuracy and completeness of the data because they know that they are subject to that third-party assurance. Catie:              And, Doug, you had mentioned, I think, very rightly, that having the right team in place is critical to being able to have the right processes and technology also in place, to ensure that your reporting is complete and accurate. And we're seeing on the client side that a lot of our clients don't, necessarily, have the resources in place to start to organize that.  So I wanted to ask, in your opinion, and Dan, feel free to jump in. How important is it to not just assign one person to do all of your ESG reporting? But how important is it to have that cross-functional team approach to these non-financial disclosures? Doug:              I think it is absolutely essential. One structure that I see work a lot is to have a steering committee. To set strategy and to be plugged into those reporting frameworks that you've mentioned, Catie, and some of the customer demands and organizational strategy and where things are going. And a more tactical working group that's closer to operations, and the systems, and controls to really modify those systems and controls and talk to each other.  A couple of things I've seen work really well. I've seen those committees be assembled, and people show up, and they don't know why they're in the room. And it really helps to have a coach or an external resource to help facilitate all that. To make sure that people are talking the right language and not talking past each other. So you get everybody on the same page to take actions in ways that are aligned with the company objectives, that helps a lot.  A couple of functions that I don't see on those teams but, I think, should be there a lot more than they are IT, for sure. And many of our listeners are from accounting, I would say accounting. I don't see on those cross-functional teams as much as I think they should be. Much of what is required for the sustainability reporting, it comes from accounting. You get utility bills from accounting. Get a list of assets from accounting. Get a list of our ten largest customers from accounting. Accounting has the master key to a lot of this information. But the information that's in company systems, in my experience, was not designed for the way the information needs to be reclaimed and used now. So there are some changes that need to be made in accounting to enable this reporting and to enable the systems and controls. To, then, ensure accurate reporting, verifiable reporting, and the fact that we tighten down the controls so that we can prevent the possibility of fraud. Dan:                Yes, great points, Doug. I really appreciate you bringing up the steering committee. Someone at the top of an organization that is there to set strategy. And I think that it is common, and it will become more commonplace, to have that steering committee require that any fraud risk assessments, that are being done within an organization, include ESG fraud as part of what they're doing.  And in conducting a fraud risk assessment that is a stress test, that's looking for ways in which various kinds of scenarios. Such as the scenarios we brought up in our report with the ACFE, of ways in which ESG fraud could be committed. And then looking at whether the controls in place within the organization, are sufficient to prevent and detect or detect those occurrences.  So, Doug, I know that you've been contributing to an exciting report, that's been recently released from the IMA. Could you give us a few highlights in that regard? Doug:              Sure, I'd be happy to. I was one of the primary authors of this document, the only non-CPA on the team. I provided the ESG specialist input for this very important report. It's a COSO report and IMA is, of course, a member of COSO and their leadership had a terrific role in pulling this together. And it will resemble a lot kind of the report you've had major involvement with from the ACFE, on fraud, ESG fraud. In that it begins with a framework that everybody knows and is very familiar with, the COSO Internal Controls Framework, and there's something old and something new.  There is a summary of some of the key points of the COSO Internal Controls Framework, the components, and the points of focus. And on each of the components there's some information demonstrating how the internal controls framework can be applied to ESG.  So that in terms of non-financial management of information, and of reporting, and of communications, and of control environment. It can be applied and it points you in the right direction on how it can be adopted to improve the effectiveness, and the efficiency of company organization, management, and reporting. I encourage everyone to read it and use it. [00:36:50]       < Outro > Announcer:    This has been Count Me In, IMA's podcast. Providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Discover the secrets to unlocking employee engagement in this eye-opening episode of the Count Me In Podcast. Join us as we welcome Sarah Rubenstein, Chief Accounting Officer at Clearway Energy, as she shares valuable insights into employee engagement, strategies to transform disengaged employees, and the importance of creating inclusive communities within the workplace. Don't miss this chance to learn how to maximize productivity and employee satisfaction in your organization! Connect with Sarah: https://www.linkedin.com/in/sarah-rubenstein-a724632/ Full Episode Transcript:Adam:            Welcome back to Count Me In. In today's episode, we're thrilled to have Sarah Rubenstein, Chief Accounting Officer at Clearway Energy. With us to discuss the crucial role that employee engagement plays in an organization's success.  Sarah brings her extensive experience in cultivating positive work environments to the table. Offering valuable advice on identifying disengaged employees, implementing effective strategies to boost engagement, and the benefits of fostering an inclusive, collaborative workspace. Stay tuned as we uncover the keys to unlocking a happy, productive, and thriving work environment. Adam:            Well, Sarah, thank you so much for coming on the Count Me In podcast, today. We're really excited to have you on, and today we're going to be talking about employee engagement and all that that encompasses. And maybe to start off, maybe, you can start by defining what is employee engagement to you. Sarah:            Sure, to me, employee engagement is how positive people feel about their work, and we measure that in a lot of different ways. But, really, I'm lucky, the company that I work at, we survey our employees every year, regarding employee engagement. And we ask some really good questions that were developed by very smart people at Harvard, and Yale, and Stanford, that tell us how engaged people are.  And, so, we're able to evaluate, and a lot of the questions relate to things like management, leadership, integrity, work-life balance, workload, allocation, autonomy, and things like that. And all of those factors really tell us how engaged our employees are. Adam:            That's interesting, and when you mention engaged, a lot of times when you see discussions about employee engagement. You see engaged employees versus disengaged employees. And, so, maybe we can start by talking about that a little bit. Because you have your engaged employees, and you can usually tell who those are. But the disengaged maybe a little harder to see, or maybe not so hard, depending on what they're not doing, I should say. Sarah:            Yes, sure, and the first indication we have, that some employees are not engaged, is that they don't answer the surveys. So we don't get 100% participation. So that tells us that some people feel like maybe their voice won't be heard, even if they answer. And those people, usually, just have a negative outlook, maybe, on what type of work they're doing or their future within the company.  And, so, a lot of times, you lose the engagement when people feel like there's no career development path for them, or the work that they're doing isn't valuable, or they're not being told that the work that they're doing is valuable. Adam:            And that can be very difficult for an employee, especially, when you don't feel like you can't move up in an organization. How do you take somebody who is disengaged and try to get them to be engaged? Sarah:            That's a great question, and, especially, when you don't have a development path for a person, it is really challenging. And, so, what we try to do is we try to provide a lot of personal and professional development opportunities. And we talk to our employees about how those types of opportunities can help them develop themselves. Whether for this particular company and role or just in general for their career. So we try to offer them opportunities to learn and also to, maybe, work in an area that isn't related to their job.  So we try to look for things we call stretch assignments. Where there might be an opportunity in another group, where someone needs help with a special project, and that might give that individual the opportunity to learn new skills that they can put on their resume, even if it doesn't give them direct path to promotion. So we try to demonstrate what we can offer the employee, even if it isn't upward mobility, and that maybe we can't keep them forever, but we can keep them a little bit longer, and that helps us overall. Adam:            Yes, because it shows that you care and that you're engaging with them, even though they seem to be disengaged. And, so, it encourages them, even if there is no upper mobility at that moment. Sarah:            Right, because everyone is looking for some type of personal development, even if they don't see a future for themselves at that company. So we try to offer something for everyone. If you don't see yourself as a leader at this company, that's okay, we'll work with you on how you can make yourself a better employee and a better person. So that, at least, we can keep you around, and have you feel happy to be working at the company for the time being. Adam:            Mh-hmm, that makes a lot of sense. So maybe we can focus a little bit on what are some benefits, to organizations, to creating an engaging environment? Sarah:            I haven't read all of the studies, but there are numerous studies that show that engaged employees are better employees, they're more productive. Of course, we know that hiring new employees, and training them, and getting them up to speed is very expensive and time-consuming. And, so, it benefits us to take the time to develop programs to promote employee engagement. Because, overall, we end up with better productivity and just a better workforce. Adam:            I mean, that makes a lot of sense to want to have a better workforce, especially, when they're engaged. And, so, maybe, we can talk a little bit about what do you need to look for, especially, when your team is not engaged. Are there certain signs that you can look for? Obviously, you mentioned you can tell people are not engaged when they're not taking a survey. But then what are other signs that you can look for, within your team, if you can talk a little bit about that? Sarah:            Yes, no problem, I think, there are  a couple of different signs that I look for. Generally, I look for people who aren't participating in the conversations, who don't speak up in meetings. People who have been doing the same work for an extended period of time. And, of course, you look for the signs of people who are not responsive. They're taking a long time to reply to emails or teams' messages.  Those are all signs we look for, for people who aren't engaged. And then we really try to find ways to bring them into the conversation. To make them feel like we're committed to their success, and that we're interested in having them as part of the conversation. Adam:            Do you think that having engaged people with the not so engaged people, connecting them together, that can help drive or improve a team? Sarah:            I definitely do. Maybe one other thing I'll say about employees who aren't engaged is they tend to leave. So, really, our primary focus on employee engagement started when, and I won't say it started, we've always had a focus on it. But we renewed that focus when the great resignation occurred. We were hearing about that.  It didn't really happen at my company. But we were very concerned that once everyone was out of sight, out of mind, working remote from home, people might start to feel disengaged when they're working on their own. Without interacting with others. They might start to look at other jobs online while they're at home and things like that.  So we really wanted to focus on making sure that didn't happen. So we started some programs that were designed, specifically, to promote employee engagement. And one of those was a mentoring program within the accounting department.  So we matched up individuals who were at lower levels with our managers and directors, so that the managers and directors could give the staff-level folks an idea of how they could get to that level. And also they could just give them the ability to communicate with someone they didn't work with all the time. So that they would feel more engaged in the overall department, and not just able to speak with their direct supervisor and their specific team. Adam:            That's great. Mentorship is a huge way of connecting different departments, different people, within an organization. And it also helps people feel like they're part of a community. Because a lot of times corporate structures feel like a prison, in a lot of ways, with the fluorescent lights and everything. And it sounds like you guys are building a sense of community. Has that been what you're looking to do? Sarah:            Yes, definitely, I would say there were two very large parts of our program were communication. So making sure that we had adequate amounts of communication across the department, and within the specific teams, and then collaboration, in general.  So having a team's channel for our whole department, where people could even just share a photo of their pet or something funny that they wanted to share. So that people do feel like they're part of a broader community and not just a small, little, group. And, then, I'll say that I'm very fortunate, I work for a company that is committed to diversity, equity, and inclusion.  And, so, two years ago we started inclusion groups, and those have been a really big help in employee engagement and in helping people feel like they're part of a community. So I will say for companies that don't have inclusion groups, yet, I think, it really is a big benefit to employees. Adam:            Can you, maybe, talk a little bit more about the inclusion groups? What does that look like? Sarah:            Sure, so, typically, they're focused around a specific group. So we have a women's inclusion group. A veterans' inclusion group. We have a Latinx inclusion group, things like that. But it's to give employees, across the company, the ability to connect with people that they relate to and then also the ability to share with the whole organization, the things that are important to that inclusion group.  And, so, it's really been great, both, for bringing employees together with people that they relate to. And, then, also, making them able to share that with the whole company and educate them on the issues that are important to them. So it has been really great in bringing our whole community together. Adam:            That's awesome, that's a great way of connecting people and also helping to educate the greater community, as well. Because a lot of times, if you only are focused on what you know, you never get to experience or understand what other people's experiences are, which helps you understand the human condition better. Sarah:            Right. And the other thing that's nice about the inclusion groups is that they have executive sponsorship. So the issues that are important to the inclusion groups are brought to the attention of the executive leadership. So they're then aware of what's important to their employees and it gives them a forum to do that. But without the inclusion groups, the executives might hear about it but it wouldn't, necessarily, be in a positive way and it doesn't give them as much exposure to it. Adam:            Mh-hmm, and it also gives people a voice who may not have had a voice before. Sarah:            Yes, and that also because it's open to anyone. It's nice that some of the people who are at lower levels, in the organization, can still become very active in these inclusion groups. And have access to people at different levels that they might not have access to if they didn't join that inclusion group. Adam:            Mh-hmm, that's awesome. So we're thinking about engagement, I want to talk a little bit about what are some drivers that bring employees to become engaged or to engagement, within an organization. And maybe you can talk about some drivers that have helped your organization, as you've seen it, especially, over the last two years? Sarah:            Yes, the main one that I see is employee development because it demonstrates that you care about your employees and their own career. And, so, that you're not just worried about the company or yourself. You care about that person and how they can grow themselves. So we've focused a lot on personal development. Fortunately, we have some really good training tools, online training tools. So we have a lot of programs that our employees have access to, and what we've tried to do is go through and identify some that would be useful to people. So they don't have to go combing through a thousand training programs. So leadership training and teaching them how to manage people and how to improve their interpersonal communications. And then technical training to help them develop their technical skills, so that they can perform their job better or be able to potentially move into a different role.  We have a really good opportunity for our employees to receive coaching, which a lot of our managers have taken advantage of. Which is really great because it gives them a chance to work with a trained coach, to improve the skills that need improvement.  So that they can work to become future leaders of the company. And, then, I mentioned before the stretch assignments. But all of those things have been really helpful, showing our commitment to the development of our employees. And, then, the other area, I'd say, especially, during the last couple of years people have really looked for is just empathy and understanding. We're very aware that everyone has things that they need to do outside of work. We're very respectful of people's time with their families.  We're flexible in work arrangements and we try to be aware of what's happening in people's lives. So that we can make sure that we're not putting too much work on them. If they have something they're dealing with outside of work that they need to focus on. And I will say we've gotten really positive feedback, when we do take the time to show that we care about our employees, as individuals, it makes them feel very positive towards the company. So things like that really pay off.  And, then, the third area would be recognition. So I think that recognizing the positive contributions of your employees, has a huge benefit. And some studies show even more than compensation, I don't know if that's true or not. But it really does help to ensure that people know how much you appreciate them.  And, so one thing we've started to do is we have a quarterly meeting for our entire department. And every quarter I ask people to nominate people that they work with, that they think have done something that was, particularly, special or helpful. And, so, then we acknowledge that in front of the whole group, and that really goes a long way towards making people feel really appreciated and that the work that they do doesn't go unnoticed. Adam:            That's amazing to hear, and in the conversations that I've been having, even just in this podcast. It seems like the common theme is that we've all understood our human condition outside of the corporate structure. And recognize that it's okay to have a kid run into the room when you're in the middle of a meeting, or a dog barking, because that's just life. And you can still have your meeting and still be professional in the midst of all those things, and it kind of brought us all together at the same level. Sarah:            Yes, I agree. And it is true, you do observe those things happen to executive vice presidents, down to staff-level people. Especially when we were all home, we're all dealing with the same type of things going on, and it does help everyone feel like we can relate to one another. Adam:            Yes. And, so, as we look forward into the future, a lot of people have moved to a hybrid situation, or all in the office, or partially in the office, every organization is different. How do you think we can continue engaging employees in the midst of rising costs? In the midst of shareholders saying, "Hey, okay, you had your little break from the COVID now you need to get back going there." And a lot of organizations are finding it difficult to find that balance. Because workloads are starting to increase, as people are increasing what they want out of their employees. How do you balance that? Sarah:            That's a great question and it is really difficult. I'll tell you my experience because we have our own struggle with bringing people back to the office. And we're recommitting to a hybrid work schedule because we had attempted one, and people still really wanted to work, primarily, from home. And it's hard because people do want the flexibility of working from home. And we know that they're very productive at home.  I think that we've tried to emphasize, to our employees, that "We know you're productive from home. We're not worried about productivity. But we want people to have that human connection. Because it is an important part of engagement to talk to people in-person, and just have a conversation that's not related, primarily, to work.  And, so, we're going to renew our enthusiasm for encouraging people to come to the office two days a week, and we are emphasizing that we're going to be very flexible with the time that people arrive and the time they have to leave.  We understand they have commitments outside of work. And, then, it still gives them a few days a week to work from home, and have those really productive stretches of uninterrupted work. Where they're not having to drive to the office or someone is not stopping in to say hello. And, hopefully, this gives everybody the best of both worlds.  Where they can have those two days with the in-person interaction, maybe some visibility to higher level executives that they can't get from home. But then still have that uninterrupted time at home, the productive time, and that flexibility to not have to commute.  And then the other thing that we're trying to do, we did this year, was we did have a, and, although, it's expensive, but we got our whole team together in one location, for a couple of days to just do some training, and some brainstorming, and some planning for the future. And it was such a great experience and everyone really loved being together in-person, and being able to brainstorm together. And then everyone left feeling renewed about the future and excited. And, so, I think, that goes a long way towards keeping everybody engaged, is having that opportunity to all come together. Adam:            Yes, there's something about the human connection and seeing somebody, as opposed to as you and I are, we're looking at each other through little webcams. But sitting across the table from somebody, there's a huge difference in that connection point. And I think we do need that, as humans, we need that human touch. And, especially, getting out of the house every once in a while is good for everybody. Sarah:            Yes, I think so, I enjoy the two days a week in the office, and then I enjoy the rest of the week working from home. So I'm hopeful that the hybrid approach works. Adam:            I am too. I think this is the new normal, is hybrid, because everybody recognized, "Hey, we can be successful working from home and be just as productive, if not more productive." And then finding that balance will be the way forward. Because if you can't adjust your organization to be a hybrid, then, you might find more resignation. Because people are like, "I'll go to someplace where they will let me do that." Sarah:            Yes, and that's a fear that a lot of companies have and, especially, in accounting because there are a lot of jobs. If people want to work fully remote, then, they will. So we're trying to emphasize what are the benefits you get from being around people. We understand there's benefits to being home, and that's very appealing. So we're trying to show the appeal of the two days in-person, and the opportunity to interact with people and benefit from those in-person connections and interactions. Announcer:    This has been Count Me In, IMA's podcast. Providing you with the latest perspectives of thought leaders from the accounting finance profession. If you like what you heard, and you'd like to be counted in, for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Join us on the next Count Me In as we delve into the world of accounting and finance with Megan Weiss, YP and General manager, FAO services and host of the CFO weekly podcast at Personiv. Learn about the talent shortage in the accounting industry, the benefits and challenges of outsourcing, and how recent events have impacted the profession. Don't miss this insightful conversation about the future of accounting and how companies can adapt to thrive. Connect with Megan: https://www.linkedin.com/in/megan-weis/Check out the report mentioned in today's episode: https://insights.personiv.com/reports/cfo-talent-survey-reportFull Episode Transcript:Adam:            Welcome back to Count Me In. Where we explore the world of accounting and finance with industry experts. Today we're thrilled to have Megan Weiss join us. With a rich background in accounting and consulting, Megan currently leads the Finance and Accounting Division at Personiv. She's here to share her insights into the talent shortage, in the accounting industry. The pros and cons of outsourcing, and how recent events like the Great Resignation and quiet quitting have shaped the profession. Let's dive in and learn from Megan's wealth of expertise and knowledge. So, Megan, I want to thank you so much for coming on the Count Me In podcast, today. And I wanted to start off, a little bit, by if you could just give us an overview of your background and how you got to where you are today. Megan:           Yes, sure, and thanks for having me. So I graduated with an undergraduate degree in accounting from Kent State University. I managed to pass the CPA in my final semester of school there. So right after school, I went to work for Deloitte & Touche, one of the Big Four accounting firms, and I was with their audit practice. I stayed and served my time for about three and a half years.  When I left there, I went to work for Pricewaterhouse Coopers in their transaction advisory services group. Where we were looking at helping organizations who were getting ready to purchase a business or sell a business, just to determine if it was a good fit. If they were paying a good price for the business.  From there I went to work for British Petroleum as a financial analyst. I left there after a couple of years to work for Accenture and that was back in 2003, and that was when I was introduced to the idea of outsourcing, it was pretty new back then. Not a lot of companies were doing it and the ones that did do it were very large enterprises.  So I stayed there for 13 years, and while I was with them I went back to school. I got my MBA from Duke University. I left Accenture to then work at a small boutique consulting firm here in Dallas, Texas. It's called Everest Group, and it is a consulting group that focuses on outsourcing service providers and companies with shared service providers.  And, so, my role there was to focus on finance and accounting and I was really looking at the service providers, and their visions for the future, and where the finance and accounting outsourcing industry was headed. And, then, while I was there, I did a project for the company I am at now, it's called Personiv. And the project I did for them was to take a look at lines of service that they should consider getting into.  So, although, they'd been around since the mid-'80s, finance and accounting was never really on their radar as something that they should maybe venture into. So during the course of that project, finance and accounting was one of the things that we suggested that they branch into. And, so, when they decided to go down that road they reached out to me, brought me on to start it up.  So I've been here now for five years, it's been a really exciting journey. It's like being in a startup organization, but with the backing of a company that's been around for 35 years. So that's how I got to where I am today. I feel like it's a good culmination of everything I've done to date. Adam:            Yes, that sounds great. You've had quite the story going of a bunch of different places, but it shapes who you are and how you see everything in the accounting world. And one thing that you and I had talked about is that there is a talent shortage, in the accounting and finance world, when it comes to having to outsource, it's because you have a talent shortage, and it's been around for over 15 years. Reading articles of people saying, "Oh, it just showed up during the pandemic." But as we talked about your experience, previously, you're saying, "Well, no, it's been around for a long time." Megan:           Yes, I mean, I would say it's been around for, at least, the last two decades. When you've read top challenges for CFOs, over the last two decades, talent has always been one or two, on that list. And, I think, it really started way back in the early 2000s, when they decided that they would make accounting a five-year program. In order to sit for the CPA, you needed a master's degree, and that's, maybe, when people stopped going into the study of accounting. And, really, it's been around and becoming more and more of a problem, every year since. And back in 2015, the AICPA, which stands for, actually, American Institute of Certified Public Accountants, and they were predicting that by 2020, 75% of their members would be retired. And I know not every accountant is a CPA, but that's a good indicator of where the profession is headed.  And, then, you add, on top of that, millennials and Gen Z's, who are looking for more meaningful work. And accounting, historically, has not necessarily been seen as an area that is conducive to meaningful work. So, yes, it's, definitely, been exasperated in the last three years since COVID hit, but it's been a problem for a long time coming. Adam:            So if you're in an organization and you recognize that, "Hey, I need more talent in my accounting team." What are some benefits that they can see when they think about outsourcing their accounting and finance team? Megan:           Yes, well, in the years past, outsourcing was really about just cutting cost, and it was all about the cost, savings. But, today, it's really about opening up a new pool of talent. A pool of talent that's equally qualified as the talent you would find, if you could, here in the United States.  So, yes, it really is just a wonderful way to find very talented accountants. And on top of that, if a client chooses, I mean, you can have 24-hours coverage. You can have people that work here in the United States. You can have a team that works over their days, which is on the other side of the world. So you're basically getting 24-hours coverage. But a lot of times, consultants or outsourcing providers, have people that are willing to work nights. Because that's not uncommon, in India or the Philippines, where a lot of this outsourcing is done, for people to work overnight in support of U.S. companies.  And as I mentioned, it opens up an entirely new pool that maybe you can't access here in the U.S. But, also, a lot of organizations think that unless they have like a team of 10 to 20 or even more resources to outsource, that it's not an option for them. And I know we, personally, at Personiv will take on as little as one resource.  So if there's a role that you've been trying to fill or maybe you're just tired of the turnover in that role. Yes, there are outsourcing service providers out there that will take on small teams of one or two, and just free that up from your plate and let CFOs, controllers, accounting managers, focus on things other than turnover and training up new people. Adam:            Well, that makes sense, and I can imagine that not everything's all sunny side and roses when you're trying to outsource. I'm sure there are some downsides that you have to be aware of as you're getting into this. Megan:           Yes, that is definitely true. And, like I mentioned, a lot of times, in the past, and maybe it's changing a little bit today. But a lot of times in the past, people were looking at outsourcing as a way to cut cost. And, I think, no matter who your service provider is, you're going to have cost savings.  But if you're just looking for the cheapest service provider, you're probably going to end up not loving outsourcing. Just because you'll end up with a team of people who are very good at following a set of instructions. But you're going to do more handholding than actually being able to get your work off your own plate.  So one of the downsides to outsourcing is just looking at cost, if that's the only thing that you're concerned about. And, also, there are a lot of outsourcing service providers out there that will try to force you into a box, I'll say. Where you're required to be on their platform.  You're required to follow their process, and at the end of the day, you get the numbers but then you're spending a lot of time incorporating those numbers back into your results for month end. Which ends up adding a lot of work on the back end, when you're really under a lot of pressure to get stuff done and numbers out.  So those are really two of the biggest downsides to outsourcing, it's just ending up with a very cheap team, who provides very cheap service and, then, just being forced into a box and having to do things a certain way that might not fit the way you do things today. Adam:            That makes sense, so in essence, you need to make sure you're doing your homework if you're going to be looking into this. To make sure you find the right organizations that will fit your needs. Megan:           Yes, that's very true. You should be looking at a partner, it should be an organization or a service provider that's willing to partner with you, customize the solution to fit your needs. Our clients have very good experiences with outsourcing. And, so, we're very careful to provide them with a service that is very customized to what it is that they need. Adam:            So you've made it very clear, through your experience, that the talent shortage has been around for 20 years. But the last three years have definitely not helped. We've got the Great Resignation; we've got quiet quitting going on. How do you think the last three years have really affected that talent shortage? And, also, when we think about accounting education and people going into accounting, they're not going to the traditional roles. Megan:           Yes, that's very true. So just looking at the Great Resignation, as an example, I mean, you have a group of people who are known to be very conservative with their money, and they've probably maxed out their 401(K)s. They're in a position where if retiring early is an option, they're going to take it.  So a lot of people that were expected to be around for maybe another five to ten years, COVID hit and they reprioritized, and they decided to leave the workforce earlier than expected. And baby boomers leaving has been a big issue on the horizon for a decade or more now. So that's how the Great Resignation has affected the talent pool. And then you have quiet quitting. You have people who they're coming to work, but they're putting in the bare minimum effort, and the rest of the team is having to pick up slack, and the rest of the team is, probably, already burnt out.  Accounting is known for grueling hours, at times, throughout the year, particularly, month-end and year-end. And if you have someone who's slacking, the rest of your team is forced to pick up that slack. And then when you look at people that are just entering college and they're trying to figure out what they want to do with their lives. Like I said, a lot of younger people are looking for more meaningful work, maybe, sexier work. There are a lot of technology companies out there, these days, that are luring really great talent away. And they have more options when they get out of school, even if they did study accounting.  I mean, there's consulting and there's just a lot of other avenues that they can take. And I also feel like the skill sets that accountants need have changed, dramatically, over the last 20 years as well. Whereas people who were just good with numbers could study accounting and be successful. Now, it's really the soft skills that stand out and make a candidate great. So, yes, you have all of those things working together to really put a noose around hiring accountants, and it's been a painful few years, for sure. Adam:            It definitely has, and I know everybody is feeling it. And, I think, the other thing that we have to remember, too, is that the accounting role is changing, like you mentioned, that you have to have different sets of skills. You can't just be the number cruncher. You have to be the business partner; you have to be the data analyst. You have to do a number of different roles that people weren't expecting to. And the older generation has to adapt, and the newer generation has to jump on this new wheel and, so, everybody has to change. And, so, how have you seen organizations doing that?Megan:           Yes, well, in general, accounting hasn't done a very good job of marketing itself. Which is why, I think, a lot of younger people steer away from it. Because it's still viewed as the nerd that sits in their office, crunching numbers. And, really, accounting can take you a lot of different places, and my career is a good example. I mean, I've done so many different things, and I've really enjoyed most of what I've done. And I just don't think that accounting has done a really good job of marketing that to younger generations.  But, yes, I mean, these days, accountants are more storytellers than anything else. They have to know the business. They have to be able to understand data and create insights out of data, and, yes, it's challenging, it's rewarding. And organizations could not function without an accounting department, which is, again, part of the talent problem.  But I actually read an article in The Washington Post, earlier this week, that said and this might be a bit extreme, but that "Capitalism, it might fall because of this accounting talent shortage." And if you think about it, the only reason why capitalistic markets survive is because people trust the financial statements, that are behind the investments they're making. And without accountants, making sure that those numbers are accurate and fairly depicted, you have chaos.  We've seen it as recently as the collapse of Enron, a few years ago and, then, Arthur Andersen, right behind it. So, yes, talent is a big deal, and filling accounting roles is very important for companies and countries. Adam:            Yes, it is. Now, I know Personiv did a survey, talking about the war for talent after COVID-19, the results of the CFO Talent Survey. Maybe you could tell us a little bit about what your organization saw in surveying CFOs. Megan:           Yes, so we just did a survey in 2022, this year. And the last time we had done the survey was in 2020, and in 2020, we saw that it was a problem. But in 2022, everything seemed to be magnified, and here are five of the takeaways from the report. But 34% of CFOs say that their most pressing challenge is finding and hiring qualified accounting talent. So that's more than a third, who would put that at the very top of their list, it's just finding good talent.  81% of finance leaders say that they have felt the accounting talent shortage in 2022, and of those, more than 10% think it's just going to get worse in 2023. We saw that 85% of finance leaders say that COVID-19 has affected their hiring process and talent-sourcing abilities. 72% said that it had an impact on retention, and companies that are right now struggling between, "Do we bring people back into the office? Do we let them stay remote?"  I feel like the retention problem for them is even more magnified. And then we saw that 47% of CFOs said that they need to hire at least one qualified accountant within the year, and that number for us was up by 20% from when we looked at it just two years ago. And, then, 88% of finance leaders say they wish that they had more time to spend on strategic initiatives. Meaning because they have a shortage of talent, they're mired down in the details rather than leading their organizations into the future. Adam:            I mean, that's very telling, is that they can't even look, strategically, and help be that business partner because they don't even have the time to do that.  Megan:           Yes.Adam:            That says a lot about what's happening. Megan:           Yes, they're busy spending their days putting out fires and just trying to get numbers out the door in a timely fashion, let alone looking, strategically, into the future. It's just not possible for a lot of organizations right now. Adam:            Yes. So we'll make sure to put a link to the report in our show notes, today. But as you think about this report and what you've seen in the 2022 report. And let's say you guys do, and I'm assuming you do every two years. 2024, do you think that it's going to be any better or where do you think that things are going to go as we look forward? Megan:           Yes, no, I mean, I think, this is going to continue to be a problem. I think we're going to continue to see demand go up for accountants. It's something that's gone up every year. Even as we automate processes, there's more of a need for people who can analyze data, and supply is dwindling. So the demand is growing, supply is dwindling, and this problem is only going to exasperate in the coming years. So I'm interested to see where we are in two to five years. Adam:            I am as well, and, maybe, we'll have you back on in two years and we can have that discussion, Megan, how does that sound? Megan:           Yes, that sounds great. I'd look forward to that. Adam:            All right, well, thank you so much for coming on the podcast today. It was great to have you on. Megan:           Yes, thank you very much for having me, it's been fun. Announcer:    This has been Count Me In, IMA's podcast. Providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant account and finance education, visit IMA's website at www.imanet.org.

Dive into the world of fintech with our latest episode of the Count Me In podcast, where we discuss the transformative power of financial technology for businesses of all sizes. Join us as we chat with Joe Keeley, the CEO of Justify, a company dedicated to accelerating the fintech potential of software platforms. Discover how companies can leverage fintech tools to reduce costs, enhance revenue, and offer new services to their customers. From the giants like Amazon and Starbucks to small businesses, the opportunities are endless. Don't miss this insightful conversation that will change the way you think about the financial landscape. Connect with Joe: https://www.linkedin.com/in/joekeeley/Full Episode Transcript:Adam:            Welcome to Count Me In. Today we have a special guest, Joe Keeley, CEO of JustiFi. Joining us to discuss the world of fintech and its impact on business. We'll explore what fintech really means? How companies can harness its potential, and why it's important for businesses to understand the various tools available in the fintech toolbox. Joe will also share are some fascinating success stories and insights on how companies can thrive in this financial, technology-driven world. So let's get started and delve into this exciting world of fintech. So, Joe, I want to thank you so much for coming on the podcast, today. We're really excited to have you on and we're going to be covering the topic of fintech, and that is a big buzzword in the industry right now. And I was hoping that we can maybe start with defining where you fit in the fintech world, and we'll continue on from there. Joe:                 That's great, thanks for having me, Adam. And it is, I think, fintech is one of the biggest buzzwords that's out there. It's been said by leading venture capital firms that every company should be or will be a fintech company. So it's like, "Okay, well, that's a lot of pressure." So first of all, I think, we need to step back and say, "What is that mean?" I mean, it's just an abbreviation, just flat-footed, first, it's financial technology, which can mean so many different things. But, for us, the company that I lead is called JustiFi and we exist to do just that. To accelerate the potential or the fintech potential of other software platforms.  So in that context, it turns out that a lot of companies that are out there, one of their major, or their biggest, or only economic engine is not actually selling the product, or the service, or the access, then, that is there in plain sight.  So, for example, software platforms, there are many software platforms that sell a SaaS fee, and they charge you to use it. But that is simply the Trojan horse to get funds flow. So they're making money on payments. They're making money by offering additional fintech products like embedded insurance, embedded lending, card issuing.  So when you think about interchange that, deliberately, opaque monster that no one really seems to understand. You can make money and participate on interchange, by lowering your costs and keeping your price. And you can make money on interchange by participating at being high, too, by issuing cards. So there's just a lot in there. But, ultimately, what we do as a company is help platforms with their economic engine being fintech, and we provide infrastructure and a team to help them do that.  But it's interesting for all companies, not just software companies, to think about and try to understand what are the different tools in the fintech toolbox, and how could they be applicable to your business, big or small? Whether that be through cost reduction, or an area that's typically not talked about by finance and accounting professionals is enhancing the revenue. Adam:            Totally, and I think the other part of the problem that we run into, with every company being a fintech company is that, you and I were touching on this a little bit before we started recording, where does it live? Your IT team has to manage it and finance has to touch it, but nobody really owns it. And how can you really fully manage it if no one really owns the software, when it's within your company? Joe:                 Yes, and that is a really big issue. And part of our JustiFi, we have what we call our tech infrastructure, but we also have an engaged fintech team. Where we have a dedicated chief payments officer. A chief fintech officer that's available to our clients because they sit in between finance and accounting, and product and engineering or IT at a particular company. But I would think one of the things that I would really encourage and if multiple people own something, to your point, Adam, then nobody owns it.  But to finance and accounting professionals, to really take the ownership of how can we and challenging the status quo. Does this 3% need to be 3% when we collect or how could we think about differently on lowering cost?  How could we think differently on what adjacent revenue streams could be available to us. Where you're enhancing the offerings to your customers? It may not be the core product but, ultimately, it's been said that on every dollar in commerce, there's up to 10% of that. So a thousand basis points that is available and leaks out, whether that's in fees-in fees-out, early pay discounts, all of these different things.  So I would encourage from a strategic perspective, it's one that finance and accounting can own this. Implementation of how it's working is more product and engineering. Adam:            Of course, an example that comes to mind is I just saw an article, a couple of days ago. Where Amazon is going to start accepting Venmo as a payment option. And if the big behemoth, Amazon, can start accepting Venmo as a payment. What possibilities are there for every company to accept different types of payments, and be more creative using technology?  Joe:                 That's right and, sometimes, you're accepting a type of payment like Venmo or a buy now, pay later, and it's actually a more expensive payment method. Those are more expensive payment methods, then credit card and debit card, and then bank transfers, and ACH, going all the way down. And you do that because you're trying to get more customers or you're trying to ease the customer journey, the customer experience.  But in terms of every company being a fintech company, you want to make those choices with your eyes wide open. Because what if you could monetize or make money on that payment flow? And it takes certain kinds of architecture to do that. But just understanding the space, it's the first step. Why are we doing something? What is it actually going to cost? And there's just an immense amount of opportunity that exists there. But basis points can matter at scale, they very much matter at scale. Adam:            Yes, especially, when it's affecting your bottom line in the long run. Especially when there's a tight market, and inflation, and everything else happening. Joe:                 That's right. Adam:            So as we think about companies trying to be more advanced, and trying to be a fintech company, and trying to be creative. Do you have any examples of companies that have been successful? It doesn't have to be specifics, but are there any things, successful ways of becoming a fintech company? If you're just a regular, maybe, we could talk about some success stories that you've seen. Joe:                 Yes, that's great. I mean, we have a number of them and we help a number of software platforms harness the power of fintech. And, in that instance, it's a little more straightforward because in software platforms, they have business customers. The platform has a business customer, and then the business customer has a customer themselves. And when you have three legs of the stool there's, then, opportunity to do probably one of the more best-known fintech monetization, which is payment arbitrage.  Where you're charging 3%, at a platform level, to the customers, but your cost is actually 1.9%. And then you take that delta and you multiply it times funds flow. So then that number can, sometimes, get much, much bigger than the actual SaaS fee that someone might be charging.  So examples of that are, Toast is one that many of us interact with on a weekly basis, whether we know it or not. So Toast is a vertical SaaS platform for the restaurant industry. They provide hardware, they provide software for restaurants. So if you go and order out for takeout or delivery, or you go into a restaurant and you swipe at their terminal, you'll see the little Toast logo.  Well, Toast is just a fintech company, really. They provide software and hardware, but they're monetizing all the funds flow from all these restaurants. And then once you understand the funds flow, then you can start offering those restaurants short-term loans, maybe, to repair an oven. And why would you do that, from a customer standpoint, is because if you are embedded in their software.  That is a much better user experience than that restaurant owner deciding, "I want to go walk down and talk to my local banker. And by the time I fill out that application, and do the KYC, and all the things that need to be done, I've already put the new oven on my credit card because it's an emergency. More or less, short-term capital needs. So there's all of these. Toast really started as a fintech company first, that was their intent all along. But if you look at a direct-to-consumer company, this example that's been fairly, widely, used is one we all or many of us interact with on, sometimes, our daily ritual and that's Starbucks. So you think about Starbucks.  Starbucks launches their app, and if you notice when you are topping up your balance, the default is $20. Now you can go in and change it, but when you add $20 to their card, their app, now their average transaction size is much bigger than a $4 cup of coffee. So their effective rate on credit card processing goes down, and they clearly have ability to negotiate beyond, let's say, all of us at this point.  But also Starbucks is now a bank. They're holding billions, and billions, and billions, of dollars on stored value cards in which they can use as working capital for no interest, while we wait captive to order the next Macchiato. So just really stopping and thinking about how is money flowing into your organization?  How is money flowing within an organization? Maybe that applies, maybe it doesn't, depending on the size. And then how is money flowing out of the organization? So that's the first thing to think about as a fintech company. And are there opportunities to capture a couple of basis points? And you might say, "Oh, a couple of basis points, I don't have the time." And maybe you don't and maybe it doesn't apply.  But, for us, we work with vertical software platforms. And a lot of times it's not uncommon that they can get to many hundreds of millions or billions of dollars of money flowing in and around their ecosystem.  So thinking about how, and capturing 20 basis points on a couple of billion, all of a sudden, is material. The other thing that folks should think about is where, if they think about themselves as a platform. Whether they're, literally, a software platform like we work with at JustiFi or maybe they're a marketplace. How many dollars are flowing, not maybe through your P&L, but in and around your ecosystem. And could you bring those dollars in in any way, shape, or form? Could you offer that?  So that's really what software platforms are doing. On the Toast example, they're providing lending, probably, either off their own balance sheet, or a credit facility, or, probably, initially, through partners, and they're participating in that transaction. But what they did is, "Our restaurants are having short-term capital needs, and it's not happening within our software. Wouldn't it be great if we brought that in and then we're going to participate in that? "  So that is the thing that we do with our clients. We help them build what we call a strategic fintech map, which is, "Where are all the opportunities?" And then you stack rank and you go on that journey.  But finance thinking about dollars in, dollars within, and dollars out in the whole ecosystem, and is there a way that we could reduce cost?  Or oftentimes, even more exciting is impact revenue by harnessing some of these fintech tools. And it doesn't mean, in fact, you should not go out and think, "Okay, we have to go build a bunch of infrastructure." We have a sub account architecture and the software that we provide for platforms.I mean, gone are the days if your product and engineering, or IT team says, "well, jeez, we're going to have to build all this stuff." That makes about as much sense as saying you need to have a server farm, now, instead of using AWS or something. Adam:            Yes, that makes a lot of sense. And even as you were talking, it made me think about the small to medium-sized businesses. Not everybody is a Starbucks and can handle that kind of a thing. But the way the technology is going, any small and medium-sized business can access this technology.  Whether it's working directly with you or they're working with an organization like Toast. Where they can get access to these payment methods, to make these things more accessible to their customers, and give the ability to have those types of payments. And the ability to have this type of technology, even if they don't have a big IT team or finance team. Yes, and, I think, if their business allows it, if you're able to monetize the power and harness the power of some of these different fintech tools. The value creation that it can have in your company in terms of valuation and how investors or acquirers look at the company, can have an impact of 10X, literally, 10X. So when we work with software platforms that maybe make 65 or $100 a month in SaaS fees to their customers to use it. So, maybe, it's a barbershop platform, a software that helps barbershops run. If they charge a barbershop $100 a month, they'll get good SaaS multiples on that revenue for the valuation. But if, all of a sudden, "Well, we make money on payments and we sell insurance to the barbershops, and we provide capital to the barbershops, and we do spend management." Now, all of a sudden, you're in a completely different valuation category. Adam:            So what effect does that have on the business? Does it give them exponential ability to grow from that point on? Joe:                 Oh, it increases the lifetime value of the customer, probably, five X. Adam:            That's huge. Joe:                 Because if you think about it, if someone is charging $100 a month, so we have a $1,200 customer there for the software. But, now, if they process, let's say, a couple of million dollars a year, and you're making 70 to 100 basis points off of that. And now you're getting 20 basis points off of a lending product, or if you're getting, ultimately, 200 basis points as you go on your fintech journey of monetization, by bringing partners in and doing different things.  Now, you could double, or triple, or quadruple that $1,200. So now that customer lifetime value is two to five X bigger than it was just selling software fees. And not only that, we know from our experience that they're remarkably more sticky. Meaning the churn that you experience is lower and, oftentimes, what software platforms that we work with, at JustiFi, they have negative churn. Meaning their existing customers are growing beyond that because their payment volume is growing. Adam:            Mh-hmm, so based on our conversation, it completely makes sense if you're not already doing something and, probably, pretty much everybody is. But let's say somebody's just getting into this space and trying to integrate different fintech into their business. Are there any red flags that they should be on the lookout for, since this is an ever-growing, ever-changing thing, with companies popping up all the time? Joe:                 Yes, I mean, I think that a couple of things that I would have folks think about, is if you are bringing folks, partners, into your ecosystem, you should be participating in the monetization, number one.  If you are finding yourself talking about or actually building core infrastructure, you should stop and ask, "Is this something that we need to build?" And, three, in order to participate in this, it used to be that you had to go through just immense pain and exposure to liability, to be a payment facilitator or to lend off your own balance sheet. You no longer need to do that, you should not do that.  So don't take on the burden of being in the payments business, being in the lending business. There are businesses that are doing that, but you can partner with them and participate in it and you are a better-together scenario. Because the cost to build, maintain, to be in this business, of course, with financial regulations, et cetera, is ever increasing.  So I'm not saying that everyone should go out and say, "Now we are a fintech company." JustiFi is a fintech company. We help others harness the power of fintech within their platforms. That doesn't, necessarily, make them a fintech company. And, so there's a slight nuance there. Instead of the way the quote was from, I think it was Andreessen VC firm, "Where every company is a fintech company." Well, I think, I would modify that, ever so slightly, that every company could or should harness the power of fintech and fintech tools within their company. Adam:            And that makes a lot of sense because, right before you said that, I was going to ask you that question. So how can every company [00:18:59] be fintech company in that case? But you answered that, where everybody can harness, has the potential to harness that power. And when you do harness that power, you've already given examples of how they can grow, exponentially, from that.  So as we look at the future, markets are all over the place. There is inflation in the U.S. and globally. What do you think the future of fintech is going to look like as things are changing, as we go forward? Joe:                 Well, I think it is going to continue to accelerate. There's all kinds of buzz out there, as it relates to the challenging of interchange, the crypto blockchain, et cetera, and all of that will happen. But that's really the leading bleeding edge right now. I think that there'll continue to be alternative payment methods. There is a great addiction to our credit card points in the U.S. So I don't see that going away anytime soon. Even if it reduces 10%, which would be a massive number, it's still just a massive space. So I think that companies are going to need to really think about and meet customers where they are. How do they want to pay? When do they want to pay and with what method? And, I think, just challenging the status quo, the way that things have always been. Having that fintech mindset is what I would encourage folks to think about. Look through that lens and say, "Does this need to cost what it has always cost, and why?" "Is there a revenue stream that we can participate in?" And, sometimes, the answer might be no, depending on the business. But it's amazing that the power and the value that can be increased, with just a different point of view. Sometimes the economic engine that exists or could exist inside of a business, is not what the business is actually in. Because when you think about the size of all fintech. Which includes payments, which is one of the largest industries in the entire world, and insurance, and lending, it's pretty amazing how big it is. Adam:            It is pretty amazing, and as I circle back to the finance and accounting team. Just thinking about that team, the look of that team is constantly changing with the advances of technology. Do you think that like an accounts payable person, their set of skills is going to have to change? What is that set of skills going to look like in the future? Because in the past, it was just like receiving payments and sending them out. But that set of skills and that knowledge is going to have to change, as the technology changes. Joe:                 Yes, and there are some great technologies that are out there to help accounts payable be more efficient. And a lot of times those tools will be available for low or no cost. And that might be great, and maybe that's just embracing new technology, and new companies that are out there.  But if you have the fintech mindset, you're able to look at that and say, "How come I'm going to use this platform and they're going to handle all my accounts payables. How do they make money?" Is the question one should ask.  Well, they might be aggregating all these accounts payable going to vendors, and getting the early pay 5% discount. Now, all of a sudden, that's 500 basis points that they've captured and they may be paying those payables on a card, a virtual card, a credit card that they spun up, and are participating in a portion of the interchange for another 80 basis points.  So having that mindset, because basis points matter. They matter at scale, they matter over years and years. So having that mindset around, and identifying, certainly, for some businesses, I mean, it's very clear the playbook for vertical SaaS platforms and marketplaces, that's who we work with to help them.  It may not be as clear for the neighborhood coffee shop, let's say. I'm saying "Well, I'm not Starbucks and I'm not a vertical SaaS platform." But they do use a lot of software and platforms. So just having that mindset, and looking at the world and understanding how is the money flowing and who is making money on this money flowing, I think, is a great place to start. Announcer:    This has been Count Me In, IMA's podcast, providing you with the latest perspectives of, uh, thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in, for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Dive into the world of ESG (environmental, social, and governance) at IBM with our latest episode of Count Me In. Today we discuss the challenges and successes of implementing ESG objectives in a global corporation. Join our Guest John Mahoney, ESG External Reporting Project Manager and hear how IBM's commitment to sustainability, open communication, and cross-functional collaboration is driving positive change and shaping the future. If you want to learn how to navigate the complexities of ESG and unlock new opportunities, don't miss this episode!  Connect with John: https://www.linkedin.com/in/johnmahoneycpa/ IBM Impact: IBM's ESG Framework | IBM Full Episode Transcript:Adam:            Welcome back to Count Me In. In today's episode, we're joined by John Mahoney, an ESG external reporting project manager, IBM. He shares his unique journey and insights into the company's approach to ESG integration. We discuss the importance of having the right company culture. Support from leadership, and cross functional collaboration to make ESG initiatives successful. So sit back and relax and let's explore how IBM is uniting for a sustainable future. Now, John, I want to thank you so much for coming on the podcast today. We're really excited to talk about ESG, and ESG at IBM. And, so, many professionals, in this space, have been reluctant to engage with ESG for a number of different reasons. But maybe you can start with talking about what your journey is, was to get here. John:              Of course, and my thanks to you, Adam, and the IMA, for having me. I'm excited to be a part of the Count Me In series, it's really great. In terms of my story, I'd say I've had a relatively conventional accounting background, in that I spent the first chunk of my career in public accounting. Splitting my time between audit and advisory services. Where I was fortunate to have the chance to work with some really great clients, and help them navigate through complex and challenging topics. Spanning from the adoption of accounting standards, acquisitions, carve-outs, stocks implementation, as well as, some SEC reporting jobs.  So I was really grateful to have seen so many different things, early on, in my career, in public, and I knew I wanted my next role to be dynamic as well. So I was very thankful to have landed at IBM. First joining the Accounting Practices and External Reporting Organization, which is really a consultative group focusing mostly on technical accounting consultations, as well as the preparation of IBM's periodic SEC filings.  I had always enjoyed the reporting aspect of the job, and helping companies craft their stories and messaging to external parties. So I knew I wanted to stay close to that and I was grateful that the opportunity at IBM afforded me that. So, as you can tell, I don't have an ESG background, but I did know I wanted to continue to explore new topics. And with all of that being said, I had been keeping an eye on the energy in the ESG space, and I had expressed interest to stay involved wherever possible within the group.  So when the opportunity arose to make it a full-time job, I jumped right in headfirst. And really saw this as a great chance to apply the skills that I've been working on, thus far, in my career to a new area and one that was not only hyper relevant, in the time, but also deeply purposeful in terms of subject matter.  We spend a lot of time working on dollars and cents related topics and working through financial statements, and this was just a really exciting opportunity to apply my skill set in a different forum. So, well, I can't speak to reluctance, personally, I'd even venture to say that we're probably passing the point of reluctance. But for those that are hesitant, I'd encourage everyone to engage and start exploring the topic and draft standards.  While it is gaining more momentum as a topic, there's still only a small amount of accounting folks that are focused on it currently. And with the rules still being written, it's a great chance to get in on the ground floor and establish yourself as a go-to person, not only within your organization, but really the space at large. So really excited to be a part of the journey, and keen to see where it takes me and all of us at large. Adam:            And I'm really excited to hear about your journey, as we've heard other people's journeys when it comes to ESG. I find that everybody's journey is different and I feel that that brings a real diversity of thought into the ESG space. Which is needed in something that's growing and something that's just starting out, you need to have many different perspectives. John:              I couldn't agree more, and everyone I've engaged with have been coming from a diverse background. And some folks have that key SEC reporting or accounting footing, and other folks, perhaps, have spent more time in true-blooded ESG functions, if you will. I think between the pending rule on SEC climate, the Corporate Sustainability Reporting Directive in Europe, the ISSB standards, we just haven't seen anything of this magnitude all at once.  So bringing together a diverse group to really tackle this watershed moment for the profession. It's going to have broad impacts on not only finance and accounting organizations, but organizations for years to come. Adam:            Yes, definitely, so when organizations bring on ESG into their organization. You have to start combining the ESG objectives with the overall objectives of the organization. How does IBM go about harmonizing those objectives? John:              Yes, so, no surprise, IBM is a large company. We've got more than 280,000 employees, globally, operating in more than 170 countries. So with that scale, and for the scale of most large companies, there's always countless initiatives and objectives that need to coexist, simultaneously.  We are lucky in that IBM does have a great legacy with ESG just as it relates to climate. We incorporated our first environmental policy in 1971, and began reporting on CO2 emissions as early as 1994. But truly have a deep history in all three pillars of ESG. So that legacy is great, in that it not only gives us a head start in navigating the landscape and proposed rules. But it also has helped establish responsibilities within the organization, as well as avenues for communication between groups.  So really fortunate to have that legacy. But even with that head start, recent activity in the ESG space comes with even more and it adds incremental objectives that we all need to navigate. Including pending regulations that I've mentioned. Rating agency requests, shareholder needs, analyst inquiries, and countless other internal and external factors. So really important to emphasize how important that open lines of communication and regular touch points with different functions are. And, also, the importance of educational sessions to bring awareness of what other functions are managing and striving towards. Leading with that transparency not only helps to avoid duplication of efforts, but it also unlocks efficiencies and helps us understand one another and how we're going to strategize. So each function can achieve its mandate and targeted objectives, while still being mindful of the larger picture.  Adam:            Yes, so I hear you talking a lot about how ESG affects different functions within the organization. Which requires those functions to talk to each other or work together. How has IBM, what has been their approach when it comes to cross functionality and making sure that everybody's talking together and not staying in their silos? Which happens so many times within corporate structures. John:              Sure, yes, so I'll first speak to our external reporting project and our current ownership, within the financial and accounting organization, and I've only been in my role for a few months. So there is countless work that have been done prior to me arriving in this seat. But we've been very busy kicking off our project and establishing a task force, as you put it.  Given the magnitude of proposals and the potential impact, not only at a consolidated reporting level, but perhaps also even at a group or a subsidiary level, depending on what the international rules finalize as. We did know that we had to get started right away.  And, so, we kicked off a few key work streams. Starting first and foremost with stakeholder identification and outreach. We, effectively, held a roadshow where we connected with various functions, within IBM, to not only alert them of the pending regulation. But also to learn about their current areas of ownership and processes within the company. Which was a great first step for us, it really helped emphasize how cross-functional this effort will truly need to be.  We spoke to probably more than 20 functions in the process, and they all will need to be involved in some capacity. And, so, as we continue down this path, I'm certain that that number will continue to grow and more folks will be pulled in. I do think that that's also very telling and that this effort is going to span the entirety of organizations, and you're going to need the full breadth and strength of the groups within, and that ownership will ultimately need to be shared.  So providing those educational sessions, speaking to awareness, and just trying to elevate everybody, internally, at once. While keeping them all aware of where we're marching towards is vital. Adam:            I mean, that's amazing to be able to have that cross-functionality to work and to be successful. That's not an easy task for any organization, so I really commend you. It sounds like it has been something that is working toward a successful thing.  John:              Yes, for sure, and there's even more work streams that I could probably speak to for hours. But, I think, all of this was an upfront investment that we, very much see as necessary in terms of driving the project. So those conversations not only helped us understand what's out there, but it also helped us establish project governance. And we've established that task force, that subcommittee, and we hold regular touch points now with the group.  And we were able to identify one to two representatives, during those discussions, that all, now, join us for these regular touch points where we keep them apprised of the regulatory landscape developments and we also kick off, initiate, monitor, and advance our work stream. So it's really been a great joint effort thus far. Adam:            Yes, that's great. So we've talked a lot about the people doing the work, and then there's people who're overseeing everything within organization. The senior leadership reports to the Board of Directors and the Board of Directors, ultimately, answers to the shareholders. But what extent are the Board of Directors involved into this process? John:              Yes, so it all does, ultimately, start with the oversight of the board, and I'd say that ESG is very much embedded within the organization. In part due to that legacy but also, in part, just due to the excitement and potential of what's to come in the decades ahead. And that can be seen and is relevant through some of our go-to market offerings. Our use of technology, research and development efforts, as well as other internal initiatives and just overall remarks from our chairman and other senior leaders.  So, ultimately, the Board of Directors, and its committees, do have oversight responsibility for these areas. And under their guidance and supervision, IBM's senior management is then responsible for the company's environmental and social performance. And they're able to do so via two groups, in particular, which help integrate CSR across the business. And those are our Executive Steering Committee and the ESG working group.  So both of those groups meet monthly, and they include representatives from functional areas spanning all of IBM. Including the atypical ESG groups as well as HR, accounting, legal, procurement, really great representation spanning the organization. And it's between those two groups that leadership is able to provide the direction on key corporate responsibility issues, and also stay apprised of work related to ESG matters.  So while that's the day-to-day operation and actioning of ESG-related activities. We then do report, the Chief Sustainability Officer provides periodic updates to the Board of Directors and we're now, also, providing regular updates to the Audit Committee as it relates to work underway and the regulatory landscape. So it's great to have these channels in place, and I'd say senior leaders are absolutely seeing ESG as an area of focus within the company. Adam:            And that's wonderful to hear, when you set the tone at the top, it really sets the stage so that all the cross-functionality, the things that we've been talking about, are recognizing, "Hey, I have the support of my leaders that I can do this and we can do it well." John:              Yes, absolutely, I think, having that support from the top is crucial. I'm sure that's true for all organizations, but it's only through that support, and direction of leadership, that all organizations are able to operate in harmony. So, absolutely, a crucial step in the process to make sure that you are on the appropriate people's agenda and radar, and that they're aware of what we're marching towards  Adam:            Yes, so when it comes to any new initiative, there can be challenges with buy-in, and with ESG you can get into so many different elements of why somebody wouldn't want to buy-in. But the biggest thing that, probably, comes to my mind with what you've been describing is it's, probably, adding extra workload onto people. And, so, have there been challenges to buy-in within IBM, as people are having added elements and uncertainties with the coming regulations and things like that? John:              Sure, yes, it can be hard because people do have full-time, day jobs and they've got a full plate of duties as it currently exists, and now we're asking them to focus on an additional area. But I would say that the response within IBM, internally, has been very positive overall and folks are both willing and eager to help.  And, I think, some of that is probably due to our culture and the fact that people have tended to work in multiple roles within the company. So they perhaps have an understanding or a perspective as to where we're coming from, as finance and accounting, and that always makes conversations easier to have.  But I do think it's important to approach those conversations and ask for buy-in with an open mind and a sense of understanding. ESG is not, historically, a core competency for accounting professionals and we realized, very quickly, that this was a new frontier for us. So, in that regard, we didn't want to be the team that showed up and forced ourselves in, and forced our way of thinking on groups. We wanted to pause and listen, gain an appreciation for the great work that had been happening before accounting entered the room, and that helped build trust, I think. But also leading with the fact that we're here to help. We're not taking over ESG reporting. We don't know everything we want to learn in team, and we're all working towards a common goal of providing investor grade financial, and now non-financial reporting has been helpful in having those conversations. I would say that while there's not, necessarily, challenges with people buying-in. I do think there can be challenges, at times, with planning and embracing the plan. Just due to the overall, uncertainty, surrounding what the final rules might look like. It can be hard to convince folks that they need to jump in, full force, with so much uncertainty and such frequent developments on the standard-setter front and in the space. So as the rules finalize and effective dates become more clear, it'll be easier to have those conversations, and the path forward will just reveal itself and we'll know exactly what we need from everyone then. Adam:            Yes, well, and having the right company culture is a key element, and people being willing to just being open-minded as they go into conversations and new responsibilities. So it sounds like there is a great company culture there and that's really exciting to hear. John:              Yes, it's fantastic and, I think, between our points on support from leadership and support from the groups, I think, that's going to prove to be crucial. There's just so much happening, and given the breadth of the international proposals, that it's becoming clear that we'll likely need more resources, and not all those will live within accounting and finance, and they'll likely be homed in other functions. So having that support, having that understanding and cross-functional awareness is just going to help avoid surprises or last minute scrambles when the rules, ultimately, are finalized. Adam:            So, shifting gears a little bit, when it comes to reporting, there are some key concerns that we've heard from other organizations, that there's a need to rely on third-party data. What is IBM doing to address those types of concerns? John:              Yes, there's been a lot of talk of that topic. And I know there's a lot of comments on it, and there, certainly, are inherent challenges that come with data aggregation. There is, especially, the requirements that involve data from the value chain. It's always challenging to aggregate, create data, that's coming from outside your organizational walls. And an easy example of that is greenhouse gas emissions, where entities will need to rely on third party data in several capacities.  It's going to take collection of invoices from utility providers. Use of emissions factors from various sources. As well as data from upstream and downstream activities, potentially, your customers and suppliers. So while there's a lot to gather and to think about, I do think that accounting and finance professionals can help bring some discipline around the difficulties dealing with estimates, and help provide guidance to other functions. Surrounding the need for adequate, relevant, sufficient, and reliable data. All that is the basis for estimating the estimate and to mitigate the risk of material misstatement. So while accountants might be less familiar with the subject matter itself, we do understand the need to formalize processes and put rigorous and robust controls in place, for areas of significant estimates and assumptions. Adam:            John, we could talk about ESG for hours. There is reports, constantly, being written about this studies being done on it and there's many professionals who are curious about it. And if you're a professional who's thinking about getting into ESG or you're looking at your organization, and you're recognizing "We're not doing anything about this." What advice would you give to that professional, as they're looking to get into it? John:              Yes, it's a great point, and it's in everyone's best interest to get engaged as soon as possible. There's so much momentum in the space, and there's going to be such a widespread impact to accounting and finance professionals. That it's really great to get started early and learn what is facing us as a profession and potential rules.  I do think it's also a great chance that we can all elevate and upskill one another. We're all embarking on this journey, simultaneously, and I've, personally, enjoyed having outreach with peers in the space, and trying to leverage, and join working groups where they exist, and learn about best practices, and other happenings at other companies.  So joining the effort, probably, an inevitability in terms that rules are coming. In terms of timeline and effective dates, maybe, that's less certain. But there's a lot to do, and joining now will just set yourself up for future success. Well, for what really is a turning point, in the profession, and something that we'll be focusing on for years and decades to come. Adam:            And, sometimes, getting in the ground floor, you get to see the evolvement real-time, as it happens, which can be really exciting. John:              Yes, for sure, and that's really front of mind, today. It seems like not a day goes by, and I've only been in this role for a few months, but there's no shortage of news cycles in the space, and seeing stuff evolve, and what may or may not be required, it's changing quite often.  And watching that evolution, well, it can be a bit daunting, in terms, of what it means for implementation and next steps, I think, it's very exciting to watch it play out real-time. And really feel involved in what is coming, and how do we react to that, and pivot, and really important to stay nimble and on your toes. Adam:            Well, John, I just want to thank you so much for coming on the podcast. It was really exciting to have you on and everything you shared with our audience today. John:              Of course, and thanks again for having me, Adam. It's an exciting space and I'm excited to be a part of the journey, so thanks again. Announcer:    This has been Count Me In, IMA's podcast. Providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in, for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

In this episode of the Count Me In podcast, host Adam speaks with Matt Druckman, an expert in the field of crypto accounting, about the challenges of accounting for digital assets. With no authoritative guidance in place, Matt explains the framework of best practices and opinions that have been pulled together to guide the industry. However, as the nature of crypto and digital assets is changing rapidly, there is a need for increased vocalization and guidance from regulatory bodies such as the FASB. Matt also highlights the complexities of cost basis and accessing and making sense of data, which can present challenges for accountants as they try to categorize and report on digital assets. This episode is a must-listen for anyone interested in the field of crypto accounting and the future of accounting for digital assets. Connect with Matt: https://www.linkedin.com/in/matthew-druckman-60a21938/Full Episode Transcript:Adam:            Welcome back to Count Me In. The podcast about all things affecting the accounting and finance world. In today's episode we explore the world of crypto accounting with Matt Druckman, currently, the Vice President of Business Development at Soft Ledger. A company focused on helping companies get their data faster.  Despite the existence of non-authoritative guidance, there is still no clear framework for crypto accounting. The lack of clarity is due to the, constantly, evolving nature of digital assets. Which are not easily categorized within traditional accounting practices. Join us as we navigate the Wild West of crypto accounting and discuss best practices for accounting, in this rapidly changing field. Matt, thank you so much for coming on the Count Me In podcast today. I'm really excited to be talking to you about crypto accounting. And, as everybody knows, Bitcoin has been around since 2008. But when you look at the authoritative guidance there is none, it feels like the Wild West. And maybe, as an expert in the field, you can talk a little bit about what it looks like to be in the crypto accounting space. Matt:              Great, thanks so much for having me on, Adam. Happy to get into this a little bit with you. You're exactly right, there is not authoritative guidance, yet, on the topic. What we have is non authoritative guidance. We have this framework of best practices and opinions, that have been pulled together that folks are following.  There's a really good practice aid that the AICPA put out on accounting and auditing digital assets, and that's proven to be very helpful. But there is not this authoritative framework for people to follow. So everyone's still figuring this out and the nature of crypto, and digital assets, and their evolution is it's this breakneck pace. Things are changing on a daily, weekly, basis.  So there's, definitely, a need and an increased vocalization to have this guidance in place. And it does look like the FASB is really starting to take a harder look at this, we'll probably get into it a little bit later. But there's been some momentum, recently, specifically, in October, but right now it's still early days. Adam:            So when we think about accounting. It's been the same since the 15th century, when the first accountants came into place and they were writing their entries. The accounting has pretty much been the same at its core. And when you look at digital assets, they don't really fit that core. And, so, what does that look like, especially, prior to this FASB vote that happened in October of 2022? Matt:              Yes, it's a great point. And, so, you have this new asset class, digital assets, come into play here, and we need to figure out a way to account for them. And, I think, that's where some of this complexity has really arisen, is trying to figure out where to put these. And then once you put them there, what guidance are we following? And there, probably, isn't a one-size-fits-all and that's what's happened. And, so, currently, or prior to this vote, digital assets, for the most part, were treated as intangible assets, and following the guidance within ASC 350. And, so, as a result, you also need to follow the impairment guidance that exists, and it doesn't quite match up with the economics of what's taking place with a lot of these assets. Where you have these very active markets, readily available prices.  And, so, the idea of marking down an asset, and pairing an asset, when there is an event, which would theoretically be anytime the price drops below cost. You're never going to be able to write that back up. And that just doesn't quite make sense, in terms of how people are viewing these assets, and how they're using them, and they're leading to some very material impacts on financial statements.  And, so, that in and of itself is an area that people have been very vocal about, and trying to take a better look at how these should be classified and updating how we're accounting for them. Adam:            So, Matt, are there any more complexities that accountants have to be aware of, as they're really getting into the nuts and bolts of this accounting? Matt:              Yes, the cost basis piece is definitely a tricky one that we've addressed, and that can present a lot of issues, especially, with higher volumes. But another one that should be known is just the accessing and making sense of your data. It sounds like something that should be so simple.  You have these series of transactions that are taking place on an exchange, or within a wallet, or on a blockchain. And you're just assuming that you can pull that data down, easily, and it's all going to make sense, and everything's going to be nicely categorized and classified the way you want to see it. And that's really just not the case, at least, not in all cases, some have better data outputs than others. But, especially, as you start to get into more complex transactions and, maybe, you're getting more involved in DFI's, or dealing with NFTs, or just different less-plain vanilla transactions, if you will. Being able to make sense of the data that you're pulling down, and tag that properly, and ensure that that's going to be getting into the system in a way that you want to report on it.  It can be a bit manual. There could be a process that needs to take place, to make sure that you're properly categorizing everything and getting it into the system. It's not just going to pop out of an exchange or another data source, and everything's going to be nice and neat. So I think that going into it, knowing that there's going to need to be some work there and probably some processes that need to be ironed out.  Certainly, if you have maybe a little bit more of a sophisticated operation, and you're capable of putting a business logic layer on top of that data before it gets into your platform. A system like ours, like Soft Ledger, that's programmable via API, that's one way that data could be ingested. So there are some things to help automate that and smooth that process, but it can be a bit manual. I would think that in the future, as there's more regulation and more of an impetus to standardize data. That should improve, and maybe there'll just be better tools, if nothing else, to help scrape that data and give you what you need, but just something to be aware of.  And, so, I guess, when we're talking about what crypto accounting or accounting for digital assets, at the end of the day, it's still accounting. You're still going to be booking debits and credits. The complexities, a lot of them lie in the fact that there's a lot of new terms. There are new terms being used that we're not familiar with.  People are learning about blockchains, and NFTs, and DFI protocols. And what it really comes down to is getting more familiar with what's really taking place with these transactions. Understanding the nature of these transactions. How they, ultimately, need to be classified and presented.  And I think that, on top of that, there's just the inherent complexities that come with dealing with a volatile asset and high volumes of transactions, if that's the case for your business. That are going to present some difficulties and, thankfully, there are systems out there that are specifically designed to help automate some of these processes, and remove some of the manual, cumbersome, elements that come with needing to track and calculate cost basis. But, ultimately, we are still accounting for assets in the way that we are familiar with. Adam:            So do you think that this FASB vote will help bring us towards some guidance or something to help accountants, in organizations, get to a place where they can set that value properly? Matt:              Yes, it really looks like things are moving in the right direction and these things are never fast. But just based on when this was taken up, in May, and where we are right now. On October 12th, the FASB voted to start treating these under the guidance of Fair Value at ASC 820. So rather than as intangibles where you're impairing these assets, you'd be marking to market.  And, so, of course, this isn't going to cover all digital assets. Initially, it was thought that maybe this would just be Bitcoin and Ethereum, but it looks like it's going to be broader than that.  And, I think, that this is really welcome, and more in line with how people are viewing and using these assets. Adam:            So as people are continuing to use these assets, it makes me think of your typical ERP system. It doesn't seem like those ERP systems were created with the ability to support these types of assets because of the volatility. I know in our talks, before this, we were talking about how, sometimes, you have to go to eight decimal points with cryptocurrencies. How are major organizations handling that? Matt:              Yes, it's a great question, and there's a software component and then there's just a human capital component, as well. I mean, this is all new, for the most part. I know it's been 14 years or whatnot, as we said at the beginning. But still, in terms of where things are from an adoption standpoint, and from just an experience and exposure standpoint, for a lot of accountants, it's very early. So you have that component. You also have the fact that a lot of these crypto businesses, they're very early stage. They're not going to have, in many cases, an accounting or finance department. Let alone one that's filled with experienced, X big-four, auditors. So there's a lot that is still up and coming on that front. But from an ERP and system perspective, yes, you're exactly right. These systems weren't designed to handle digital assets. This technology, these assets, didn't exist when these systems were created. And, so, you can bump into these issues. The first one being that you're going to need to have a separate, call it crypto tool, to track your crypto activity and then integrate that with a system that wasn't specifically designed to handle crypto.  So there are issues that are going to exist within that ERP, such as we refer to coin support. Are they going to be able to represent that specific asset in the system properly? To your point, on decimal precision, a lot of these assets you need to be able to go out eight decimal points. Is that going to be a problem in a system that wasn't designed to handle digital assets?  So there are a few points in the process where things can break down and necessitate work-arounds. Chief among them is needing to have this integration between a crypto tool and an ERP system, and that's something that we, specifically, address, in the fact that at Soft Ledger, we are a full-featured, cloud accounting platform, but we're also crypto native.  And, so, for us, it's a sub ledger and we don't suffer from issues with coin support or decimal precision. Everything's neatly stitched together in one system. So you have this very controlled and auditable way, to go from crypto transaction to financial statement impact. Adam:            Do you think that there is a gap in knowledge within the accounting and finance team, within organizations? Is there a gap in the competencies that they're missing in understanding what crypto is? And I even think back to even colleges, are colleges catching up to training the next level of accountants so that they can be in this world where crypto is a thing? Matt:              Yes, absolutely, I think that any gaps, really, they're resulting from a couple of things. It's the fact that, again, this is new but more important, coming back to what we were discussing, at the beginning of the show, that authoritative guidance doesn't exist, yet. So I think that once we get this hammered out, then it's going to become a lot easier to really embed this into the accounting curriculum that's taking place.  But this is absolutely something that's being discussed, at this point, because it's here and it's on corporate balance sheets, and it's going to continue to be an asset class. It's going to change, I'm sure, and some of the digital assets we're talking about won't be around. But as a whole, this technology, this is going to be a part of our future and we're going to need to be spending the time educating people on how to properly account for it. Adam:            So it's almost like we need to educate our accounting and finance team, but also find partners such as Soft Ledger or other crypto accounting softwares, that can help your accounting team get to a place where they're able to do this. Matt:              Right, there's plenty that's been written, but there's much more to come. And I think that having these conversations, having the platforms in place, is certainly a really helpful piece because there are just inherent complexities beyond just the guidance. Issues we've discussed with actually tracking and accounting for these assets that present themselves, that can be really quite cumbersome.  So I think that having not only the coursework and bringing this into the classroom, and having well-developed guidance, but there's just going to be this need to continue to have these other forums and places for people to go and learn about this ever-changing landscape.  Because that is really one of the other real tricks to it all, is that a transaction that exists this week, that's novel, that's not going to be so novel next week, perhaps, it's just a really evolving space. And keeping up with the different types of transactions. and understanding what the nature of those transactions are. and how to properly treat them, it's something that you need to stay on top of. Adam:            So as you work with accountants and accounting teams, in your organization. What are some of the bigger pain points that you're seeing that they're having, as they're trying to work through these different issues we've been discussing? Matt:              Yes, it's a great question. A pain point that, consistently, comes up is tracking and calculating cost basis. That is something that is always difficult, especially, at higher volumes, depending on your operation. Once you start to have any volume, keeping track of all of your cost layers, in Excel, can start to become quite cumbersome. High volume combined with a volatile asset class, constantly, fluctuating prices. It can really lead to a nightmarish situation when it comes to actually determining what the cost basis is on a given transaction, so that you can appropriately calculate a gain or a loss.  So, at a certain point, and that point usually arrives pretty quickly. You're going to need a system that's going to enable you to do that properly, and relieve that component from the accountant's day-to-day because it really is a cumbersome process.  And, so, from a calculating your cost basis perspective, according to the practice aid I mentioned earlier. You're going to want to use a reasonable and rational method, is what they refer to as the cost method that should be selected. FIFO is what we see most commonly and that is considered a reasonable and rational method, and that would be what you would be using to calculate the cost basis on a given transaction.  Other methods we do hear about, and there's definitely a number of folks that are interested in weighted average. We certainly hear people discuss LIFO and sometimes HIFO — Highest-In, First-Out. There's clearly some tax advantage reasons behind that but the guide, and the current best practices, to use a reasonable and rational method and FIFO seems to check that box.  Another complexity that can, sometimes, arrive is just finding the principal market in terms of pricing information and that's not a difficult thing when you're talking about BTC, or ETH, or some of these high-volume assets. But more thinly traded assets, it can be maybe more challenging to identify that principal market in terms of identifying pricing information. Adam:            It seems like that this market with cryptocurrency and crypto accounting, especially, when it comes to an organization and it comes to your assets, it's a very volatile market. You can just look at the Dogecoin how it had a huge rise and then a huge fall. What advice would you give to organizations, as they're looking to get into this and they're wading these waters? Are there questions that they should be asking themselves, and their teams, they should be asking their stakeholders before they get into this. Matt:              Yes, absolutely, I mean, certainly, having the infrastructure in place to be able to handle the accounting. Whether that's having the right individuals on your staff or finding the right partners to outsource the accounting to. That's going to be critical because there, certainly, are firms that do have the experience that would be able to properly support that.  Understanding these assets. Understanding the nature of the transactions that are taking place, but also what's underlying these different assets. What are the technologies involved and getting a better understanding of what they really are. Versus just the speculative nature of investing in a specific coin or token, that's definitely going to be critical.  But then also, as we were discussing, having a system in place. If you're just dipping your toe in the water here, and it's going to be really low in transaction volume and maybe it's just an initial investment. Then perhaps a system isn't quite necessary, yet. But if this is going to become a part of your operation, you're going to want to invest in a technology that's going to ensure that you are properly accounting for these transactions.  Adam:            So as it becomes much more common, I go back to us talking about somebody just getting into this. They’re "Oh, I just have a few transactions. I don't need to look into anything too big because we're just doing one or two transactions." But if you're saying it's going to become more common, does that mean that it could ramp up very quickly for those people? Matt:              Yes, and that's a great point. And that's something that we do hear when we're speaking to prospective customers and other companies. It doesn't take much volume for complexity to really ratchet up. So while you might be fine in Excel, for a little while, if you're planning on staying involved with digital assets and they're going to become an increasingly more important part of your business.  It definitely makes sense to start thinking about a solution that's going to allow you to properly track and account for those assets in an automated way. And Excel is a great tool, you can take Excel really far, but you're still going to have the opportunity for manual error. And, so, something purpose built is definitely worth the investment. Adam:            So looking into the crystal ball, trying to look into the future. There's been tons of futuristic movies where "I'll give you 50,000 credits for that." Those kinds of things, there's so much volatility in this market. Where do you see things going as we look into the next five, 10, 15, 20 years? Matt:              Yes, it's an interesting question. As I said earlier, I believe crypto is here to stay, and it's going to evolve. It's going to, probably, look different. There's going to be assets that are going to go away, new assets that we haven't thought of, yet, but it's here to stay. And I think that people are looking to, with this type of technology, one of the interesting facets is that you're cutting out the middleman in a lot of ways. You're speeding up the pace of the transaction. You have this decentralized concept. But, really, most people that are serious about crypto are looking for regulation. That's something that really needs to happen so that there is wider adoption. Once there is regulation in place, then people are going to become more comfortable getting involved due to the protections that are afforded by having regulation.  And, so, I think that we're going to get there on the regulation piece, and that's going to really increase adoption. And, so, with that is going to just become this need to have better processes and systems in place. To ensure that you're properly accounting for these assets, which are going to become much more common on companies' balance sheets. Adam:            So what advice do you have for accounting and finance teams? Accounting and finance professionals, listening to this podcast, they're like, "That's great, Matt, you've given me some great insight and inputs. What's next? What next step should I take so that I can be prepared for the coming wave of crypto accounting?" Matt:              Yes, I think, just trying to learn as much as possible. Keep reading, articles are being put out on a daily basis. There's podcasts like this. There's no shortage of people that are speaking about it, just continue to take in the information.  If this is already a part of your operation and you don't have a proper system in place, start doing some investigative work there and feel free to go to our site and take a look at what we have. I'd be happy to have conversations with folks as well. Like I said, this is something that's going to be with us, and education is really critical in proper adoption here. Adam:            I agree, and we'll put some links in the show notes for today's episode. So if you want to take a look at some things that Matt talked about and other things, please take a look at those show notes. Matt, thank you so much for coming on the podcast today. Matt:              Thanks for having me, Adam, I really enjoyed it. Announcer:    This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in, for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Graham Stanton and Edgar Thomas co-founders of Advise  join Count Me In to talk about the current state of the market for accounting technology and the status of the industry today, which is constantly evolving. They discuss the lack of innovation in the accounting technology market and the pain points that practitioners face when using traditional tools. They share their vision for changing the status quo and making the accountant's job easier by reducing manual processes and reporting financial data more accurately and timely. The podcast also highlights the challenges of getting practitioners to adopt new technologies and the need for reimagining tasks to automate and reduce time spent on them. Connect with our speakers:Graham Stanton: https://www.linkedin.com/in/grahamstanton/ Edgar Thomas: https://www.linkedin.com/in/edgart1/ Full Episode Transcript:Adam:            Welcome back to Count Me In. In today's episode, we have Graham Stanton and Edgar Thomas, the co-founders of Avise. A company that provides accounting technology solutions. Both my guests have seen many pain points that accountants face daily, and have worked hard to build solutions that address those pain points.  Despite the available innovation, practitioners still use the same tools from 15 to 20 years ago because of the lack of penetration by newer tools. Both Graham and Edgar share their vision of making an accountant's job easier and reducing manual processes. Join us as we discuss how technology can help accountants and the challenges they face, adopting new technology.  Adam:            Graham, Edgar, I just want to thank you both for coming on the podcast, today. We're really excited to have the co-founders of Avise on the podcast with us, today. And today we're going to talk about accounting technology. And I figure we could start off by discussing what is the current state of the market for accounting technology, and the status of the industry, today? Because it's constantly moving and evolving. Edgar:            Yes, thank you, Adam, really appreciate you having us both on, today. And, yes, it's a topic that we both feel very passionately about. For me, as an inactive CPA, but a practitioner that has worked with a lot of accounting tools, I've seen it from both sides.  So, right now, as an entrepreneur, building a solution that solves a lot of the pain points that I saw in the marketplace. But also the pain points that we're getting feedback from our current clients and prospects of our own. It is an exciting time to be looking at it because there is a lot of innovation going on today. But quite, frankly, practitioners, today, are doing a lot of the same thing and using a lot of the same tools they were using 15, 20 years ago. Because there's been such little penetration by the tools out there, today, available.  So when I was practicing as an in-house accountant, a lot of the tools I found lacked the vision or the understanding of what a practitioner needed to do. So they were focused more on FP&A and other finance functions. But didn't really focus on improving the lives of the core accounting suite. That the accountants had to do their jobs in on a day-in and a day-out basis.  So if you go and talk to an in-house accountant, at a company, and they talk about their close. And they say that it's five days, it's 10 days, it's 15 days, or maybe even 30 days long. And when you, actually, dissect the things that they're doing, you immediately see opportunities for improvement based on the tools that are available today, but are not available to the accountants, yet.  So that's one of the things that I feel very passionate about. Changing that and making it so that the accountants benefit from a lot of the tools and a lot of the innovation that we see elsewhere in the finance tech stack. So when it comes to tools like the ones we're building at Avise it's really focused on how do we make the accountant's job easier. To close the books, report out the information, the financial data more accurately and in a timely fashion, and reduce a lot of the manual processes. Graham:        I'll add to that a little bit. Obviously, Edgar and I share this vision here, and when we were getting started there's a lot of real pain coming through in our discussions. I previously worked somewhat cross-functionally and had a lot of experience with the tools that the marketers get, and that data engineers get. Ultimately, FP&A was starting to get, and, for whatever reason, the accountants have been at the end of the line. And there's been a lot of attitude of, "Well, accountants are paid to do this busy work, so what's the problem here?" And it's unfortunate, and, thankfully, accountants are starting to wake up and saying, "Well, it's the year 2022, almost 2023, we don't need to put up with this anymore." Adam:            And I think sometimes the biggest thing is that if it's not broke, they don't want to try to fix it. We've been doing the same thing and using the same technology for 15, 20 years, as Edgar was saying. But why change things up and mess it up? What do you guys think is the biggest problem with the current technology, the state of the technology as it is today? Edgar mentioned some of those things, people are trying to cut down the close, and those are some of the big problems that they're dealing with. But what's the problem with the actual technology that you think is causing them to not adopt it as fastly as possible? Edgar:            Yes, I can take this, I like the way your insight there is that, for a lot of folks they accept this status quo as, like "This is the way things are and should be, or will continue to be." One of the things I really enjoy about my job today is that as we show our tool to folks, the response is very common one. Where it's just like, "Oh, I didn't even know that that was possible, or I didn't even think about how much time it took for me to do that task." So a simple thing like a reconciliation month in and month out, may take an accountant 30 minutes, an hour, 2 hours, and it's just an accepted part of the job, "My job is to reconcile an account." But then when you reimagine what a reconciliation is, and you automate a lot of the components of that reconciliation, and reduce that from 30 minutes down to five minutes, a light bulb goes off. It's just like, "Okay, these are minutes, hours, of my life that I can get back, and I can do more value added things for the business besides a lot of these things, which are, quite frankly, busy work." So one of the things that we've come across is that there's a lack of knowledge. I've never seen this before among my accounting friends. I've never seen something like this before. And then it's like maybe a hesitation, like you said, "If it isn't broke don't fix it." If I know the system has been around since 1970 and, literally, my predecessors have been doing this, I know it works, and I will continue to do it.  So it is a really exciting journey that we've been on at Avise. It's showing people you can do things in a different way, and seeing that light bulb go off. And literally seeing people saying, like, "This has changed my life. This has given me back time that I didn't know was possible." Graham:        Absolutely, we view technology as an enabler, really. We say we're looking to unlock the potential of the accounting team, of the accountants, and that's what we're seeking to do. But really any good software made should be automating the busy work. As we both said, it should be making things more efficient. But it's not doing the accountant's job, and I think that's exactly what that light bulb moment is.  It's the realization that the job isn't to do the busy work. The job is to use your brain because accountants tend to be pretty smart people. Who know the businesses they work in really well and have a lot to add. And, unfortunately, so many of them are just stuck manually entering data into the system.  Often the same data multiple times, entering it into the GL, entering it into Excel, comparing the two to see if they match, that whole flow could be automated just with some human review. But, yes, the point is to free up the accountants to use their brain, use their insight, use their creativity, and do what accountants have historically always done, help the business. Adam:            Mh-hmm, and they can become a stronger, strategic business partner as opposed to just a number cruncher. Edgar:            Exactly. Adam:            So when we think about the accounting team and how they are evolving. As they start to apply these different solutions that you guys have been describing. The accountants, what we just said, stops being the number cruncher, they become the business advisor. And as we look at these solutions, we've talked about some of the problems. You guys have discussed the current state of the industry. Maybe we can give some examples of some success stories that you guys have seen, as teams have applied these principles, and become successful by applying these solutions for their accounting team. Graham:        Yes, I also had a few here. We try to follow our own principles and look for the best tools out there, and to make our own lives easier. And as Edgar mentioned earlier, there is innovation in and around the space. So our payroll system and HRIS is Rippling. I haven't used all the solutions out there, but I have, in the past, used some of the more established software providers in the payroll space, and I can say they have a lot of busy work built into them. So we've been happy with Rippling, them taking a modern approach, cutting that out.  And then on the AP side and corporate cards we've been using both Glean and Ramp. And both, in different ways, have cut out the manual process of reading receipts and transcribing them into the general ledger. Which is something a computer is very well suited to. Edgar:            Yes, and I would add there is that with our solution, and with other solutions that focus on helping the accountants do their job more effectively. We've seen people reduce their close time from 30, 20 days down to under five days and using tools that allow them to collaborate a little bit better. Put their close into a state of perpetual closing where the system is alerting them to things that maybe may look fishy. Like the variance analysis it's spitting out versus an accountant poring over all of the data, all the time. Or like Graham was talking about, essentially, entering and reentering the same data.  I remember when I first left public accounting, and one of my jobs was to export from QuickBooks, the variance analysis tool, and do a variance analysis. And whenever an entry was booked in QuickBooks and the numbers would change, I would have to go back and re-export that data and redo everything, and that was a waste of time. I should not have been doing that. But, unfortunately, a lot of folks are still doing those types of exercises that are not really best utilizing their skill set.  I have a master's in Accounting and I'm a CPA. Those skills that a CPA learns, both academically as well as in the workforce, allows them to be a huge asset to any organization alone. And if that skill set has been utilized to re-export again and again, every day, the same thing, I think, that's a waste of human capital. Adam:            For sure, you sit for a CPA exam, or IMA has the CMA exam, you sit for these exams. And you put the time in, you put the work in, and for your job title to be to sit there exporting something and looking at it. It can be too much after a while. Graham:        So what you're saying is that this isn't the content of the CMA exam? Adam:            No, it's not the content. There's maybe one, little, page of the CMA exam. Edgar, you brought up something like QuickBooks, and it makes me think of small to medium-sized businesses. These are the ones that that's the tool a lot of them use for keeping their records.  Now, how can these solutions help small to medium-sized businesses? Maybe connect to things like QuickBooks and connect to those smaller tools. So that they can help their accounting because if you're a small business, you don't have a big accounting team. It may just be one person doing the CFO work, all the way down to staff accountant work, all in one person. Edgar:            Yes, definitely, and there are a lot of tools out there. I think it does become a point, now, where people have to make decisions like the accountant or any other person that make decisions, "What do I want my tech stack to look at? What are the pain points? Let me kind of tackle the pain points and get solutions that integrate with QuickBooks." I think QuickBooks is a great tool, at a great price point, for a lot of businesses, and that's why people use it. But I think as your business grows, inevitably, your business is going to outgrow a lot of the capabilities of QuickBooks.  So when you look at the progression of just QuickBooks alone, going from QuickBooks Desktop to QuickBooks Online. To, now, you have a QuickBooks Marketplace, and you can literally go to the QuickBooks Marketplace by pain point, and look at this point solutions to help augment what you're doing. I think it's awesome, and that really helps the accountant, the entrepreneur, get a handle over their books, and over their close process, and over their reporting, in ways that you couldn't do ten or 15 years ago.  For our tool, that we're building, we integrate with QuickBooks, so it's very easy. There's no long implementation period to adopt our tool. A lot of these other tools which take time. So, I've been through an ERP migration that took several months. It was several months beyond the original deadline, which is a waste of time.  So it's really exciting that technology now is at a point where you have open APIs that, essentially, you can do these integrations much faster, and you can get people up and running much faster. And then you can tackle depending on your pain points.  So if a business is a small business, but it's acquiring another small business, all of a sudden, you have to think about, "How do I consolidate those two entities?" And right now you would not be able to do that in QuickBooks Online. But there are tools out there that will help you consolidate those two entities, and report on them as the combined entity. One of those tools happens to be Avise. Graham:        And to pick up on that, we joke that ERP migration that was a few months behind. It might be the most seamless ERP migration I've ever heard of. I went through one that was, probably, two years behind and just involved countless people and consultants. People we had to hire, in house, just to help manage the consultants, help manage the migration, and then the system. And in, particular, for small and medium-sized businesses, growing ones, where the business is getting more complex, but the team is not that large, yet.  The old model of software really designed for bigger businesses, where you need more people to operate the software. It's the exact opposite of what you want, if you're trying to be lean, and nimble, like a small and medium-sized business.  You want software that frees up your time. That enables you and your existing team to get more done as the complexity goes up. And rather than making it so that actually you need to hire more people just to operate the software. Which is an antiquated way to look at software, and it's a very big company thing where the assumption is you're hiring so many people, anyway, of course, you're going to operate it.  So as Edgar mentioned there, we’ve built Avise largely based on our own frustrations. Aimed at smart accountants to leverage their own abilities. A few shouts-outs there to some of the software we use, and it's a modern software across the board, largely, outside the accounting function today, has had that attitude, where it should be increasing efficiency and unlocking the ability of the people using it. Adam:            For sure, yes, and when I think about mergers and acquisitions. You have to have everything in line in order before you can even cross that line. And having the technology, we've been talking about, in place to get your foundation in order seems like a very important thing. And it seems like if you're interested in getting into mergers and growing your company through that way, putting these technologies in place would be your first step to getting things in order. Graham:        Yes, that's a very good call-out. I mean, for sure, if you're merging with other companies, if you're acquiring other companies, that just greatly increases the complexity. But the complexity shouldn't be one plus one equals five. It should be one plus one is something less than two, in terms of the difficulty of managing the two. But, yes, if the systems aren't in order, then, for sure, it could be managing two companies. And then doing the consolidation is a lot harder than doing them individual.  The right systems make it easier. And, yes, for the flip side, if your company is going to get acquired, that's something we've come across a lot. Where people say, "Yes, I didn't really appreciate..." maybe tech company founders, or whoever it is, say, "I didn't really appreciate the importance of good accounting until I went to sell my company to Salesforce, and they had expectations that things would be totally in order beforehand." Adam:            So as we wrap up the conversation, as we look at the future of accounting technology. I want you guys to look in your crystal ball of all the experience you've had, throughout the years, and tell us where you think things are going? Edgar:            Yes, at the end of the day, the accountants, their jobs, to Graham's point, the technology is going to enable accountants to do and empower them to do their jobs more effectively. And then giving them more time to do more value additive things for the business, which is really exciting.  One of our values, at Avise, is we look to Luca Pacioli, who is the godfather of double entry accounting, and he was a monk. And quote-unquote, "Invented double-entry accounting," which, essentially, allowed merchants, who were trading internationally, be able to maintain their books and really understand, "I sold this amount and I bought this amount." And balance their books." And that really just allowed businesses to achieve so much more complexity. And we're in a really exciting time that we believe where this technology is really going to be embraced. And in the next 10, 15 years, businesses are going to be able to do a lot more, a lot faster, and feel confident that what they're looking at is accurate, in terms of the numbers. I've been in places, I worked in a few different companies, where it's just like day 30 is the day that we say "We're comfortable with the numbers from 30 days ago." And then the CFO cannot operate relying on data that's 30 days old because that's so stale in today's world. You need stuff now and you need it accurately.  So, yes, accountants are going to be empowered by the tools. I think for any young accountant or a prospective accountant who is thinking about it. I think, it's a very exciting time because technology is going to make their lives much better than what mine was, when I first came out, which is really exciting for them. And then it's going to be a challenge to them to be real technologists.  To really learning the newest technologies that are coming out, understanding the advantages of the new tools. Integrating those tools so that they have a very coherent tech stack. And at the center of it, we believe firmly, is that you need a GL. You need a single source of truth for an organization that can ingest all of that data and that can be relied on. And that's one of the things that we're really excited about, we're building personally, at Avise. But in general, I think that the future is very bright. Graham:        Yes, I don't think I can add much to that. I mean, I really go into Luca Pacioli to answer the question of what's going on in the future. But, yes, that's exactly it, even just to tweak that last bit a little bit. Because there's been innovation in software outside of the accounting team.  We're in this weird point in history, where business decisions are being made based on data that doesn't come from the general ledger, that doesn't come from the accounting team. Because it's a lot more up-to-date, it's faster, it's often wrong. And it often has all those same problems that were present in 15th century Italy, before double-entry bookkeeping became widespread.  And we're excited for the accounting software to catch up and for accountants to retake their places, to actually providing the information that drives the business. Adam:            And it's all more important for the accountant to have the technology in place. So that they are not sitting there bogged down by doing this menial work. Having the AI take care of those things so that they can be the business partner, be the storyteller, and help drive the strategy with the actual data that's there. Graham:        Yes, and that's exactly it, the AI can't think for the business, the AI can't think like an accountant. But the software, at least, driven by whatever the latest advances are, can take on the role of busy work. Adam:            Well, Edgar, Graham, thank you so much for coming on Count Me In podcast. We really appreciate having you on and sharing your expertise with us today. Edgar:            Thank you, Adam, really appreciate it. It was great being on. Graham:        Yes, thank you so much, I enjoyed the chat. Announcer:    This has been Count Me In, IMA's podcast. Providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in, for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

IMA is celebrating International Women's Day on March 8th to commemorate the cultural, political, and socioeconomic achievements of women.  In this special Count Me In podcast Yvonne Barber, CFO, HR Knowledge Source, discusses how the pandemic affected female small business owners and how some used management accounting strategies to help them become more  resilient. Connect with Yvonne: https://www.linkedin.com/in/yvonnebarber/Episode Transcript:Margaret:       Hello, and welcome to Count Me In. I'm your host, Margaret Michaels. Every March, IMA celebrates International Women's Day. A day recognizing the unique contributions and accomplishments of women.  Embracing equity is the theme of this year's celebration. Questions of equity are prevalent when speaking about women and the workplace. Nowhere is equity defined as the promotion of justice, impartiality, and fairness. Within the procedures, processes, and distribution of resources, according to IMA's Diversifying U.S. Accounting Talent Report. More important than in the realm of small business. Where female, small business owners account for 21.4% or 1.24 million of all small businesses in the U.S., according to the Census Bureau.  Today, I am here with Yvonne Barber, CFO of HR Knowledge Source and IMA's Small Business Committee Chair. To discuss how the pandemic affected female small business owners. And how some used management accounting strategies to help them become more resilient.  We will consider the challenges these owners face in a competitive, post-pandemic business environment. And the ways strong management accounting principles, can help them operate their businesses more efficiently and profitably. Thank you for being here today, Yvonne. Yvonne:          Thank you for having me. Margaret:       So I guess we'll start with looking back at the pandemic. Which really did bring a lot of attention to small business owners and their challenges. At the height of the pandemic, you worked for Blue Abacus Solutions. An accounting services firm specializing in small businesses. Small businesses took a huge hit during the pandemic. With quarantines, social distancing rules, and employee turnover affecting their ability to operate and stay profitable.  According to the World Economic Forum's Global Entrepreneurship Monitor, female small business owners were hit harder than men. With women 20% more likely than men to report business closures, due to the pandemic. Can you offer some perspective on why female-owned businesses were especially at risk? Yvonne:          Sure, in addition to the resource that you mentioned. I've researched this topic to develop a better understanding of the challenges faced by small businesses. So that the IMA's Small Business Committee, where I serve, can offer the support needed to the small business community.  And I found that the biggest factor to be the lack of access to funding and capital. A majority of female entrepreneurs self-fund their business. And this can limit the ability to scale their business or invest in the needed resources, to improve operations.  One of the things that small businesses, in general, struggle with is looking forward at what's coming, as opposed to reacting to what's currently on their plate. And I think that is where a lot of small businesses found themselves.  They just weren't in a position to handle what the pandemic served out to them, and that is one of the biggest factors. But among that, bias among customers was also listed as another factor.  Now, this may not be a great obstacle for some women. Especially, here in the United States, I think we've made a lot of progress in that area. But I found several studies, throughout the world, that found customers are less likely to purchase goods or services from women-owned businesses.  So there's a variety of reasons that women were impacted as they were. And I think it's difficult to offer a one-size-fits-all approach to this. I think, instead, it's good to look at each individual item. And address as it pertains to your business, as a female-owned business or a small business owner in general. Margaret:       Yes, those are great points and I think the funding issue is very top of mind. And that's really interesting, the bias, I never thought about that. But women experience bias in a lot of realms. So it shouldn't be surprising that it's also prevalent in small business ownership and customer choices. Those are great points. Yvonne:          Yes, that surprised me as well. Just because my perspective here, being in the United States, I think that we've learned to navigate that a little better. But in that The Small Business Committee, we serve a global membership. I am interested in what the challenges are for our membership. All over the world, not just here in the United States. So that was surprising to me. But it was helpful to see the information, so that I'm in a better position to offer what's needed for our members. Margaret:       And the IMA's Small Business Committee does a great job, with helping members who are struggling with these issues. In fact, IMA's Small Business Committee published two important reports, to help guide small businesses through the COVID crisis, and to help them stay resilient post pandemic.  I wonder what differentiated the businesses, who managed through the crisis versus the ones who failed? And from your perspective, why is it difficult, when you are a small business owner, to address both short-term crises and long-term strategy? Yvonne:          I think the businesses who survived focused on sustainability and leveraged strong relationships, and a diverse network of sources to meet their needs. Those who prioritized relationships were just better positioned to survive the storm. The relationships include the customers, suppliers, as well as employees. And it can be tough to think about tomorrow when you're just trying to survive another week.  I know a lot of small business owners. I know they're just trying to make payroll. But making short-term decisions that impact the long-term sustainability of a company, they may seem to help the short-term, but ultimately they do end up hurting the company. Margaret:       I think that's something that even mid and large-sized businesses grapple with, is that balance between the short-term and the long-term. And not having those short-term decisions affect your ability to operate in the long-term. So that's absolutely on point.  And now, as the immediate crisis of COVID passes, new risks are also emerging for small businesses. These include worker shortages, failure to embrace digitization, inflation, and supply chain disruptions. And without the resources that larger size companies enjoy. How can small businesses mitigate these risks? Yvonne:          A good sustainability plan can help with this. Many small business owners think of sustainability as something that impacts large businesses. With little to no impact on what they do on a day-to-day basis. But sustainability is all about efficiently using resources, and developing a strong and a diverse network of resources. And that may seem like a very pragmatic way to describe this. But buzzwords may not always be relatable to small business owners, but they understand the bottom line and how planning can impact it.  So by developing and implementing a sustainability strategy. A company can plan for a diverse network of suppliers that minimize the impact of supply chain disruptions. They can also lead, perhaps, with a competitive edge for those who may have the opportunity to bid for government contracts, or provide goods or services to larger companies. Who may be required to provide reporting on the sustainability practices of the suppliers they use. Technology can be used to streamline processes to avoid the need for additional employees. Which in a small business, that's particularly important because they don't, necessarily, have the budget for a large staff. And it's difficult to make a decision to increase headcount. And they can also avoid overloading existing employees who could otherwise burn out. When there's a labor shortage, retention can be the most economical means to address the shortage. So it's important to find ways to get the job done without burning out your existing employees. Margaret:       Absolutely, and I know that sustainability is an area of focus for IMA. We have courses, research papers. We really have looked, in depth, at how we can help businesses implement sustainability strategies. Which, to your point, can help mitigate all of these risks that this volatile global environment is now generating.  So I wonder if we can shift to your personal professional experience in accounting and finance. You're currently working as a Fractional CFO for HR Knowledge Services. What do you see as the strengths of working for your own small business, as a CFO for hire? And in working for many small businesses, both male and female-owned, do you see differences in company culture based on gender? Yvonne:          Working as a Fractional CFO, it's allowed me to create a little more balanced lifestyle. That reflects the priorities that I have in my own life. I can choose who I work for and how much I want to work. And, for me, that's something that's particularly important at this stage in my career. I think that I do see a difference in companies that are led by male or female owners, or CEOs, in my limited experience. And, again, I can speak only from those companies that I've worked with, specifically.  The female entrepreneurs that I've worked with tend to be more focused on balance, which is my own priority. Whereas some of the male-led companies tend to be more focused on results that do not necessarily take balance into consideration. Margaret:       That's very interesting because that's exactly what The U.S. Small Business Bureau has found. In terms of the motivations for owning a small business, when you look at women versus men. And the U.S. Small Business Bureau says that women have different motivations for being business owners.  For men, the motivation stemmed from wanting to be their own boss and earning a greater income. But for women, the top reason for becoming an owner was work and family balance. In total, 59% of the women felt that this was a very important reason to own their own business. So that finding seems to align exactly with your own motivations. That balance that you can strike when you're a small business owner. Did you have any additional thoughts on what the U.S. Small Business Bureau found? Yvonne:          As I said, it aligns with my own priorities as well. I think that men have done a great job, by the way. In the last few decades of making things a little more equitable, as far as the responsibilities in the household and balancing in the household. But I think we, as women, put more pressure on ourselves. I know, I personally grew up watching this, it's a perfume commercial of a woman in a silver dress. Where she sings about bringing home the bacon, frying it up in a pan, and basically doing it all.  And I think that sometimes we, as women, put more pressure on ourselves to do it all and be good at it all. And we can, but I think sometimes it's difficult to do everything well, at the same time. And finding that balance, where we can honor those things that are the greatest priority to us is the biggest challenge. And I think that that's one of the reasons why women, in general, look to open their own businesses and work for themselves. So that they can do better with that balancing act. Margaret:       That's very well said. And IMA is a resource that, hopefully, some female small business owners will take advantage of as a result of this podcast. Because, like you just said, we put a lot of pressure on ourselves to do it all. But sometimes you do need support and you do need to ask for help. And, so, surrounding yourself with people that have committed to doing that can be a good strategy.  This was a fantastic conversation and I really appreciate you, spending the time with us here today to discuss this topic. And thank you for all the work you're doing on The Small Business Committee. And for those listeners who are small business owners be sure to check out all the great resources, that The IMA's Small Business Committee has to offer.  Margaret:       Thank you and have a great International Women's Day. Yvonne:          Thank you. Announcer:    This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.ima.org.

Today we're excited to have Robert Cooke, the founder and Principal Architect of 3Forge, a New York-based fintech company that focuses on solving complex data problems in the accounting world. Robert joins Count Me In to share his story about his lifelong passion for computers and his journey to founding 3Forge. He breaks down the three buckets of data that the company focuses on: real-time streaming of data, asking computers about data, and data entry. Robert emphasizes the importance of having the right technology in place to analyze data properly and shares his experience working with various organizations to solve their data problems. Join us as we explore the fascinating world of fintech and data.Episode Transcript: Adam:            Welcome to Count Me In. The podcast, where we examine all things affecting the accounting and finance world. I'm Adam Larson, and I'm excited to introduce our speaker today, Robert Cooke. Robert is the founder and principal architect at 3Forge, a New York-based provider of data visualization and visualization technology. Today, Robert and I discuss his passion on the interrelationship between computers, people, and data. And describes the future trends he expects to see in data management.  Businesses of all sizes can gain value through using data to optimize and streamline their business. And we discuss how the technology chosen plays a role in driving a competitive advantage. Let's listen in to learn more. Well, Robert, I want to thank you so much for coming on the podcast today. We're really excited to talk about you and your organization, and fintech. And before we go there, I just wanted to start with maybe you could tell a little bit about your story and how you got to where you are? Robert:           Okay, yes, great, Adam, thanks for having me on today. So my story is I'm a lover of all things computers. I've been into computers my whole life, ever since when I was a little kid. I went through the natural learning curve, which is, originally, I wanted to build video games, and this is in the early '80s. So I was focusing on what does it mean to write efficient code and things along those lines. And then later on, we had this club, and in the club people could buy sodas and buy candy bars, and things like that and it was like a Boy Scouts equivalent. But it was all being paper-driven in terms of the accounting and everything. And I felt, "Well, this is a great opportunity for computers." And that's when I realized, wow, computers, as a kid, I always saw video games, and I realized these really are business machines, they can really help streamline things. And, so, our little club was actually, probably, one of the first grade school clubs to, actually, be managed through electric accounting.  Now, I'm embarrassed by the system I built at the time it was very hardcoded for sodas and candy bars, but it still got me started on the concept. So I've really spent my whole life thinking about, abstractly, what it means to connect humans to data. And that can take you in a lot of places.  And then I ended up working in fintech, it was Bear Stearns, it was in 2002. And I was head of infrastructure at the dark pool Liquidnet. My work product has been at many of the tier-one banks, but all the while it's been this, I would say my story has been one of interest in computers and interested in how humans and data interact. Adam:            And that's a huge part of, especially, in the accounting world. Where you have to understand where your data is and what your data is doing. To be able to visualize it properly, to give the right reports to your CEO and all of those items. And, so, we all understand how important data is. What does your organization, what does 3Forge do in terms of data? How do they look at data?Robert:           Well, I look at data, I've actually broken the problem down into three buckets. I think two of which are very important for accounting. But to be exhaustive, I'll go through all three of them. The first bucket is what I would call real-time streaming of data. And that is not necessarily as important for this conversation, but it is something that we focus on as well. So the idea is, as data is taking place somewhere you want to be able to have that streaming in, and as a human be able to read that in real-time.  An example I could give is, if you think of, at this point, cars are pretty advanced. That dashboard in your car, that's real-time streaming information coming to you, telling you your speed limit. You don't have to ask the car, "What's my speed limit?" It's just always showing it to you, that's real-time. I think very cool things could be done in accounting with that, as you start to move into workflows, but I'll digress on that.  The second thing is what I would call asking your computer about data. And, so, a very simple analogy would be you simply go on to Google and you type in, "Who is Adam Larson?" And then it comes up and gives you an answer. That would be you, a human, invoking a question, asking the computer and the computer comes back, that's the second thing.  And then the third thing is data entry, which is pretty much what it sounds like. The ability to fill out a form, hit Submit and send that. And then that goes into the computer. Maybe it goes through some validity, maybe it goes through some workflow process, with the ability to enter data. So, to recap, we break it into three buckets–   Data moving in real-time. The ability to ask questions about data. And the ability to enter data.   And I think one of the cool things is, and this is like decades to come up with this answer. It almost seems embarrassing because it seems so simple, at the end of the day. But once you've thought about it in those three buckets, you can really start to tackle just about any problem that comes your way. And, frankly, accounting has some of the most deceptively, challenging problems there is.  I mean, some of the systems that I've seen built on our platform are way beyond my understanding, to be quite frank. You know what I mean? But there's a lot that goes into it. Adam:            Yes, there is a lot that goes into it. So that just goes to show it's really important to have the right technology in place, at your organization. To make sure that you can analyze your data properly. What have you seen as you've worked with many organizations. As they come to you with different problems and having to work through their data issues? Robert:           Well, it's interesting because it goes without saying that Excel is the predominant piece of software being used. And Excel, I'm sure if I look, I've got five monitors here, I'm sure if I look around enough I'll find Excel up on one of them for something. And, I think, Excel is an incredibly powerful tool for certain activities, especially, if you're trying to mock things up quickly. You're trying to aggregate some data, maybe determine interest rates, something like that it's very good for that.  But I do think it has a tendency to be overused, to the point of abused, and I think a lot of people would agree. But at the same time, at least, there hasn't been a good alternative. And that's something we focused on, is providing that alternative. A few of the places where Excel starts to break down is, and they're making headway in this slowly, but it's being able to prevent fat-finger events. It's very easy to accidentally update data that you shouldn't be updating.  Also, it's hard to keep a good audit trail of who's done what, and there really isn't much around workflows. So let's say you and I work in an organization. You can enter data into a system, but that data doesn't actually get reflected until I, as your manager, in this scenario, would approve that. And, so, something along those lines. So the workflow aspect is another thing missing.  But with that said, I think, Excel is definitely a very powerful tool, and it's used in a lot of cases. I think there's also a countless number of vendor solutions that solve a particular problem, within any space that you can choose, accounting certainly being one of them. And then you've got, as you get to the larger organizations, a lot of our customers are tier-one banks, 100,000 employees plus organizations. They'll often roll their own software.  And, so, what 3Forge is trying to fill the gap is to provide a generic platform. And I would say Excel is a data-agnostic, generic platform. You can do just about anything you want in it. So we have provided a data-agnostic platform, but with a focus on trying to fill in those gaps around being able to audit changes to the calculations. Being able to put workflows around data entry. Making it a little bit easier to build reports. And I think another thing is, and this gets a bit technical, but having a separation between data, calculations, and display those three pieces. And, so, that's what we focused on. Adam:            Well, and that's a huge part where things can go wrong, in Excel, is where you're trying to put calculations in the same spot where you have all the data listed. And you can maybe accidentally delete something, you can do all those things. So having those blocks in place, sounds like a really great solution to some of the biggest problems that you see with Excel. Robert:           Yes, and it's interesting because these problems, a lot of these problems were solved in the '80s. And they made their ways into databases and I could talk a lot. I mean I love the history of the database, and where it's gone, and the sort of things it's done. But it's been really, I would say, centered around the developer mentality not the business-user mentality.  And, so, we've just taken a lot of the things we learned from the database discipline and tried to raise that up, so that it can be a little bit more digestible by business users. By people that are actually used to using something like Excel. So, for example, I could go on all day, but one thing that databases do very well is what you would call data integrity. So, you can't put apple pie into a price column, it just won't let you. It won't let you type that in. So it's just, "No, it's got to be a price." In fact, if you can even say it's got to be a price with this many digits of accuracy, and it has to be within this range. So if you could set up those things, it's actually pretty tough to do in Excel. Excel makes it very flexible. But it's not hard for one to imagine that you could add those sorts of features. You know what I mean? You can add those features to say, "Okay, this column of data must have this validity to it." You know what I mean? And if it doesn't, then just don't let them enter it or force them to do something else, et cetera.  So that's just one of many examples. But really it's been about, I think, a lot of our journey has been trying to bridge that gap. Between the sophisticated solutions that developers have at their disposal, learned through databases, and being able to move that up the value chain so that business users have access to that as they- Adam:            Yes, that makes a lot of sense. Because what we've been seeing in the accounting space is that a lot of accountants are learning about data science. Because they recognize the importance of having the validity of the data and being able to analyze it from that way. But are there ways for people to understand and analyze the data without being the data scientist? Robert:           Yes, first off, well, if we specifically talk about our platform, I could give general answers. But with our platform, how we've tackled that is through personas.  Adam:            Okay. Robert:           So the idea is you have, I guess, what you could call the database manager, we call it the Admin persona. And those are really the people that can actually go in and do very physical things with the data. They can actually change the validity around what it means to be a price, as an example, data integrity type things. And then you've got another persona, which is people that want to be able to build dashboards. And usually they're subject matter experts.  So they understand that; "If I take price times quantity, well, that's going to give me value." Something like that, I mean, that's a trivial example. But the idea that they are subject matter experts, and they understand how the data operates, and how it interacts, and what data from this sheet multiplied by data in this sheet, what that's going to look like. And then the last persona I would say would be the consumer. And now we're a little bit more into either people that are just looking for end-of-day reports, or want to be able to fill out a questionnaire, and then get answers around that. What was our P & L over the last quarter? And they don't, necessarily, need to understand all the inner workings under there.  So a lot of this is tackled through this persona concept, which, again, this isn't something that we invented. It's just we're trying to make it a little bit more accessible to the financial world. Adam:            Yes, so do you have any examples, maybe that you can share, of organizations that have been successful? Obviously, you don't have to use names of the organizations. But of organizations that have been successful using software like yours, as you've observed it? Robert:           Yes, absolutely, I mean, we've definitely had cases where organizations, especially, when they're dealing with money and everything has to be 100% accurate. I was surprised to learn this, but a lot of times they would have to actually tackle it, because you can never be sure, "Is the Excel, the integrity of all that data correct?" They would actually do things in duplicate and then see if everything netted out. And when it didn't, then they could work backwards. And by doing it twice, having two individuals do it, now, they knew that integrity was there. Then, the issue they start to face, over time, though, is as the assets under management grows, so does the complexity of trying to calculate what the carry interest is going to look like. This is just one example.  And, so, as the assets grow and grow this becomes, exponentially, more difficult, I'm imagining, I can't say for certain. But to me, it seems as though as you have more moving pieces and you calculate, predict it all, it just goes up and up, kind of, exponentially. And, so, it actually got to a point, and I've seen this at multiple firms, where the amount of time it takes to actually do the calculations, and to provide reports back of investor positions and things like that, exceeds what can be done in a month. And then as it grows, it can't be done in a quarter. And then, all of a sudden, you're now to a yearly result.  And, at this point, our customers, they really look at that and say they have three choices. They either just tell everyone, "Look, we can only produce this yearly." Or they say, "We're going to find some vendor product that happens." And they can use Excel in that, first example, they use Excel and they do it yearly.  Second example is they conform to an existing vendor product that has a certain solution. But that means that basically the vendor is now driving the business, as opposed to the business driving the business. You know what I mean? It has to conform to how the vendor designed the software.  And then the third option is using our approach. And I say our approach because I could see, over time, other people building products like ours. But, for now, it's our platform. So they could basically say, "Okay, I'm going to adopt this data-agnostic solution. I'm going to put my business logic in and then we can now produce these reports." And, so, we've been able to help our customers keep their very customized, I would call, intellectual property, that gives them a competitive edge. They've been able to keep all that. All those things that we're leaving, that were all domiciled in Excel, they've now been able to put that into our platform. But now they have all the rigors and checks that they would get from a bespoke vendor solution, or by hiring a team of people and building something from scratch, in a database. Adam:            So would you say that it's been successful? Have you been successful at this, as time has gone on? I see that 3Forge has been around since around 2010. How is that process gone along over the years? Robert:           Well, the crazy thing is we attacked this opposite almost every other software vendor. I mean, we really went after the hardest to-use cases there were. I think today we estimated that about one in five equity orders around the world are somehow analyzed through our software, across our clients. So when it comes to the large, recognized banks, we're being used in those.  And, so, we're talking about replacing gobs of Excel reports and it's not a technical term. But just huge volumes of what was being done in Excel have been replaced. So we've seen success, for sure, at the large tier-one banks.  It's recently in the last, I would say 24 months, that now that has started to trickle over to the buy-side. And, so, yes, we've definitely seen success at several buy-side firms as well. Adam:            So as you think about the future, as we're coming to the end of the conversation. When you look at the future and the future of technology, and how the industries are going. Where do you see organizations going as far as looking at their data? Robert:           well, I think there's a lot to be said there. First off, every organization, and I've thought about this. I blurted this out on one podcast I did a while ago, and then I thought about it retrospectively, and the more I think about it, the more I agree. There is no business that cannot gain substantial value through the data they already or should own, that they're producing. I thought about it, even if you're a small car dealership, or if you are a cleaning service, there's probably data that can help you optimize and streamline your business.  Going all the way back to my candy bars and soda back when I was a kid. So I think that, and it's definitely happening with our larger customers. They've now acknowledged that what was considered to be a cost is now an asset. At one point, I was like, "Oh, we have to store seven years of data because the SEC is requiring us to do this." And I was like, "There's overhead in this cost." And they've, actually, that's shifted on the balance sheet to an asset. So that information that's sitting there is critical. The problem is when it's sitting, and I know I keep picking on Excel, but I could pick on lots of systems. The problem is when all of that data is sitting in siloed, broken up areas and you can't look at it holistically, it's very hard to extract value, certainly, maximum value from that data. And I know I'm going on a little bit of tangent here. But one example, we had a customer who they literally had an Excel file for every single account that they were managing. So if they had 400 accounts they had 400 Excel files.  To be able to actually take that data, which is something we do very well. To take our system and lay that on top of these Excel files. Something I haven't talked too much about but we have the ability to take our platform and have it sit on top of Excel files. So you can ask questions across your entire Excel plant, if you want to call it that.  And suddenly they could realize there were certain accounts that were sitting there very domiciled, not doing anything. There were other accounts that had a lion's share of the investment, and it became very easy to ask these questions across this data. So, I think, one of the things is that organizations are going to understand that they need to start to consolidate that data, to get more value out of it. A data warehouse is one approach. I don't actually think it's necessarily the best approach, especially for large organizations, but I do think that is a big part of the future. Another thing, another trend that I see is that as systems grow and companies grow, systems tend towards complexity, they have to.  People are always adding new features; they're not really taking away features. People are adding new laws to a contract. They're not removing elements from a contract. You know what I mean? Generally speaking, and, so, as things get more and more complex, I think there needs to be more rigor around how data is managed. And I know that's a lot to chew, what I just said there.  But as systems are getting more and more complex, there needs to be processes in place that manage the flow and accountability of that data. And I think organizations that do that better, and in fact, one of our customer is all over the place. They just have their whole motto is "Stability first." You know what I mean? Adam:            Yes. Robert:           And by the way, they're probably one of the top companies, one of the largest companies in the world. And the more I thought about that, well, isn't that, kind of a boring mantra? "Stability first." But you know what? At the end of the day, it's having that stability, and having the security, and the awareness of the complexity that I think really gives people a competitive advantage. Adam:            It really does. And the other thing I was thinking about, maybe you can comment on this, what about small to medium-sized businesses? Because you've mentioned a lot of the big-time businesses. But small to medium-sized businesses are a large portion of IMA members, and they're tapping into technology more and more because the world is online right now. And, so, what about those people who are trying to get into data now? Robert:           Mh-hmm, yes, well, it's definitely worth stepping back and saying, as a small business, what is your intellectual- IP? And, by the way, I founded 3Forge in 2010,11, 2011. And, so, I know what it's like to be a small startup. And you have to make, pretty much all your decisions have to be close to correct, you know what I mean? And you have to be willing to pivot, et cetera, as you need to.  So I look at it as, for small companies, it's important to have focus on what it is that is your intellectual - IP. And be able to take that and use the correct technology for it. And I do believe that through technology, using the right technology, you can get a large competitive advantage. And if you're using the same technology as your competitors, of course, you can be smarter than your competitors, that's why you can win. You can have some edge or some insight that your competitors don't. But, ultimately, as we go down this path more and more, the technology that customers choose, that small businesses choose, is going to have a bigger impact.  And, by the way, I will say that small companies have a huge advantage in that they can be much more nimble and they can make decisions a lot faster. The ability for a large organization to switch from one platform to another can easily be a large initiative. I'm not even talking about 3Forge, at this point, just generally speaking, switching from one platform to another. 18-month initiative, 24-month initiative, a team of 50 developers, da, da, da, these huge things. But small companies take advantage of the fact that you can move quickly. Adam:            Definitely, that's a huge point to remember, is that you can be more nimble when you are smaller. And being able to do that is a huge advantage, especially, as the world becomes smaller because of how vast technology is growing, basically. Robert:           Mh-hmm, agreed. Adam:            Well, Robert, thank you so much for coming on the podcast today. I really appreciate you coming on and sharing your knowledge and expertise with us. Robert:           Yes, absolutely. Thanks for having me on. Announcer:    This has been Count Me In, IMA's podcast. Providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in, for more relevant accounting and finance education, visit IMA's website at www.imanet/org. 

Links mentioned in today's Podcast:https://www.thecareertoolkitbook.comhttps://www.thecareertoolkitbook.com/resourcesConnect with Mark:https://www.linkedin.com/in/hershey/https://twitter.com/CareerToolkitBkhttps://www.facebook.com/TheCareerToolkitBookhttps://www.instagram.com/thecareertoolkit/Full Episode Transcript:  < Intro > Adam:            Welcome back to Count Me In. IMA's podcast for finance and accounting professionals working in business. I'm Adam Larson, and today I'm excited to bring you part two of my conversation with Mark Herschberg. In which he provides a helpful framework for thinking about hybrid work plans and how you should approach finding most productive balance for individuals, managers, and teams within your organization.  In the interest of time, I'm not going to list all of Mark's credentials, again. Just high-level for those who missed the first episode. Mark teaches at MIT, he's a serial entrepreneur and business innovator, and he's the author of The Career Toolkit: Essential Skills For Success That No One Taught You, which I highly recommend you check out, just follow the link in the show notes.  Okay, that's enough introduction. Let's get right into another highly insightful conversation with Mark Herschberg. < Music > So, Mark, I want to welcome you back to the Count Me In podcast. We had a great time talking about The Great Resignation last time. And today we're going to be talking about hybrid and hybrid work and what that means for organizations. And, so, to start off, I know that during Covid everybody went remote because you couldn't unless you were certain types of organizations that had to still work in person.  But many organizations went remote completely. And now as we're on the third year of Covid, and people are coming back to work, everybody's moved to hybrid. So what it really boils down to is what can we do to be more effective in this hybrid model, going forward? Mark:             That's a great question, and there are a number of ways we can look at this. But to start, here's four things to think about as you begin to return to the office.  First, let's formalize the rules. Often we have a certain way of working, and in our last episode, we talked about corporate culture. Usually, it's not written down, we just know this is how things get done on our team, in our department. But we want to be more explicit about how we do that, and this is for two reasons.  First, it's a little different, this is a disruption. Now, we had a disruption in 2020 when we said, one day, "Stop coming to the office." And that was very disruptive. We know what's coming, we can be a little more intentional and planned this time. But also we have new people coming on board, who aren't going to be around us as much to learn by seeing. To get that osmosis, that just feel for it by being there. So we want to be more explicit with the rules. I don't mean employee handbook; I mean how we do things. When should you call a meeting, versus this could have been email, versus this could have been a Slack message.  When you create these rules get input, you, the manager, you have enough to do. Don't think, "Here's one more thing I have to do." Get input from the whole team. In fact, you can even potentially pass this off to others to take the first pass.  Now, you as the manager will get the final say, the ultimate decision. But others are probably really excited to say, "Oh, I get to be a larger voice in this. You're asking me to take the lead on this, this is fantastic." They see it as opportunity, whereas you see it as one more burden. But, again, you will have the final say. But that's to say you should really, as a leader, incorporate the voices of the whole team. Don't be afraid to almost be a little formal, in terms of the welcome back. There was a trend back in the .com era, back when companies would shut down. It was very sad, these people you had worked with for a while, there was a shift, and they did something rather clever. They said, "We have some experts who understand how to make a shift, we call them clergy." Clergy are very good at you're transitioning from being single to being married. You're transitioning from having this person in your life to now they aren't anymore, and we have ceremonies to mark that. You're doing a big transition when you say, "Welcome back to the office."  You can just say, "Well, you're showing up Monday, deal with it." Or you can say, "Hey, we're coming back and we want to welcome you back. We want to recognize there is a formal change here." And that can be a ceremony and that can be a fun, good ceremony. It doesn't have to be solemn, it could be a party. It could be more than just a happy hour.  Don't just say, "Well, we're going to do drinks, Monday, when you're back in the office." Make it symbolic. Make people understand and feel this change, just as we do with other life cycle events. So I think you should create a formal one.  And, finally, don't be afraid to change what you're doing, this is new for most of us. Now I've run hybrid companies before. I've run virtual companies before, but everyone has been different, and, especially, as we do it at a global scale.  As we do it, not just our company, but every company. Don't be afraid to say, "Maybe we need to change this up, how we do it." And that's okay, it's not a mistake, it doesn't make you look weak; it makes you look responsive to your employees. Adam:            And it also sounds like you're saying that when we come together, it should be more than just doing our meetings. Like when we come together makes sure we're meeting face to face. It should be more than that. It should be more social activity, so that we're engaging and connecting outside of, "Hey, let's meet about this spreadsheet." Mark:             Well, the ceremony I was referring to is when you first come back. Maybe in the first week or two you do something formal and that's probably more of a one-time event. But you've brought up a very good point.  The initial thinking by many people is, "Okay, you're in the office two days a week, three days a week, you really need to be productive." We know employees, you're at social or chat, you surf the web sometimes. But, "Hey, when you're in the office, come on, this is work time." And in fact that can be counterproductive. And part of it is because we do a few different things when we are working.  One is the mechanical part and that's the producing the reports, the writing the software, making the sales. We'll continue to do that from home or at work. Some of that we do individually, some we have to do in teams. Yes, keep doing that in the office and at home.  But then there are the aspects of the job that relate to relationship building. It's a time we spend building those bonds. And this comes partially from being in that meeting together for three hours, trying to come up with our new slogan. But it also comes from the water cooler conversation.  It comes from, "Let me show you pictures of my kids." It comes from these non-work activities; going out to get coffee together and then taking extra walk around the block on the way back, that's important. That builds the bonds, that helps create those internal networks that are so important to individual and company success. And that's the part that's not as easy to do online.  Certainly we can build relationships with people online. I've had relationships with people I've never met, but it moves faster and gets stronger when you do spend time in person. So when we're together in the office, don't just focus on you have to do work only, do some of these social activities as well.  And, again, I don't mean happy hours, sure, do some of those, do some of the fun stuff, but let that informal bonding happen as well. It might not look productive in the short term, but it is increasing long-term productivity. Adam:            Do you think that everybody should come into the office at the same time? Or should there be like a very, depending on projects or people. Because I know that it can be very effective, like certain people, "Yes, I'll come in the office three days a week, great." Other people are like, "No, I only want one or two days." Mark:             Well, let's think about the different things that you get in and out of the office. There are some people who say, "Oh, I love working from home. I don't have the distractions of the office; I can finally get work done." There are people who say, "I love being in the office, my home is so chaotic. I've got a bunch of young kids running around and, yes, there's a nanny, but they're always coming and bothering me. I love being in the office I can get work done." So there's not going to be a one-size-fits-all from the start. But, now, let's look at what people get when they're in the office. And here, again, it can even vary by individual. If you are 23-years-old, recently out of school, part of what you get is building relationships early on, is learning by watching others. And it's that mentoring that happens so much more easily and naturally or organically in the office, doesn't happen at home.  If you're 52 you're less worried about that and you just say, "Well, I just have to get my work done." And, so, they might have different motivations for how much time is in the office. For the project itself; the nature of the project comes down to individual work, teamwork, and communicating the work, those are the three slices. Individual work, obviously, can be done home, or at work, or anywhere you're productive.  The teamwork, this is going to depend if you're trying to do something very creative, it usually works better in person. And this is because of some psychological issues. Psychological might not be the right term, but issues with Zoom.  We know there's Zoom fatigue, and there are studies showing it has to do with the brain. It's more taxing on our brains. It's more natural when we're in the room together, things flow faster, we're less-reserved. And, so, certain types of meetings happen better there.  If it's just a weekly project update meeting, where everyone goes around the table and takes two minutes to give an update, that can probably be done just as easily from home. So if it's that information communication piece, maybe that can be done by email or by a Zoom meeting.  So we have to recognize the different types of work that we do, that will even vary over time. If you have a team that has worked together for years and just does the same thing every month, you're just doing the books for a certain project, and each month you're closing the books, you're tallying the receipts, you probably don't need to spend a lot of time together. It's mechanical, repeatable work without a law of variation.  On the other hand, if this is some new type of project, no one's done it before. You have a team that hasn't really worked with each other before. You don't have that high trust, I'm not saying mistrust, you just don't have trust. Being together more often might be helpful to build that trust, to really talk through these issues and ideas.  Then as you move into the implementation phase, you can think, "Now, we don't have to be in the office as much, but when you're coming to the project completion and there's always a whole bunch of tasks no one thought about, and you're under a deadline, maybe spending more time in the office together is helpful. So even for a given team, it can vary over time. So you just want to think about all these different factors, for how much time is right for your particular team. Adam:            Yes, it sounds like flexibility team by team is very essential, as opposed to a company-wide policy. Mark:             Now, there's a secondary factor, of course, which is, "Well, I do things, primarily, with this team and we're going to be four days for now and then we'll be two days later. But then I work sometimes with this other team and when did they need me in the office?" When you're dealing with matrix organizations and cross-functional, it's a lot more complex.  Then there's also the reality of you can say, "Well, it's four days for these months, and that's two days for those months, and we're back to four days." And people like regularity. People like to know, "I need the nanny this many days a week or I need the afterschool program this many days a week." So that could be, if you're changing around a lot, that could be a little much for people. So you want to temper it somewhat and maybe you just have, for example, a policy, "Hey, whenever we start a new project, which is about once a year, we know that month we're going to do an extra day per week for, roughly, the first month." But you don't want to change too much too often. Adam:            Yes, for sure, definitely, so thinking about just employees versus managers. I can imagine that there would be a difference in how they look at hybrid work. Because if you're a manager, you're so used to monitoring what your people are doing and it's harder when you're hybrid. It's harder when people are working from home to monitor those things. And when they're in the office you can keep your eyes on things. What is the difference there and how should they be looking at that? Mark:             This is a really important dichotomy, that I've been finding in interviews with employees and managers. Because employees, and really it's the individual contributors, they say, "Well, I have to do this. I have to produce something, and I generally do that by myself, for five questions, I can jump on the phone or send an email. I don't need a lot of time to collaborate with others." And, so, they push for more remote work. "Why should I even commute if I'm just going to sit there and work by myself, anyway?" And that's a very reasonable approach for them to take. The nature of being a manager means you need to see what people are doing. Now, part of that could be, "Give me your weekly update." And, sure, again, we can do that by phone, or email, or Zoom. But some of management, it's understanding your people. How they operate? What's working, what's not? How they work with others? You need to figure out, "Is this employee seeming disengaged lately?" "If this employee is struggling, why is that employee struggling?" If you have an employee who's very supportive helping other team members, you want to encourage that. These are things you see when you're in the office.  When I walk out of my office, I'm on the floor, I can see who's talking to whom, who's helping others out. I just naturally see it in a matter of seconds. You don't see that when we're remote. I don't see the Slack messages between two people, on a private channel. I don't see the calls and one-on-one Zooms they have.  And, so, as a manager it's a lot harder for me to see the work, as opposed to the output. I can see the end results, I can see the reports, but I can't see how it gets done. And that really matters for how I mentor, and manage, and promote people.  And, so, individual contributors don't always understand managers have to do some of that and it's not as easy from home. And, so, it's important for both sides to recognize what the other is thinking and be responsive to that, be empathetic to it. Adam:            So it sounds like communication is essential. With this whole thing we've been talking about, communication is the key part that keeps everybody together. So how should leadership, of organizations, be looking at communication, as they continue this hybrid model for the foreseen future? I don't see anybody going back to the office five days a week, anytime soon. Mark:             This is a challenge that we've seen as soon as we went remote, and we'll continue in the hybrid workplace. Let's just take a simple example, if I need to stand in front of my team and say, "Listen, everyone, I've got some bad news, we're going to be laying off 10% of the team. But, listen, it's not all darkness, there is opportunity and if we can pull together and work hard this quarter, here's what happens." I have to do a speech and it's an emotional speech. I'm giving bad news, I'm giving good news, I have to rally the troops. I have to make sure they don't go off the rails. When I do this in person, when I'm standing in front of a room of 50 people, I can read the room. I can tell, "Are people upset?"  I can tell, "Are people excited about the future?" I can look in their faces, I can read the body language, and I can get a sense of, "How are they responding to it? Are they understanding what I'm saying and are they reacting the way I would hope they're reacting?" And if not, I can address it in real-time.  When we're looking at that Brady Bunch screen, even assuming their cameras are turned on, you can't tell. You can't get that type of instant feedback. And, so, what it's meant is that how we communicate and how we lead has to be different.  Yes, I still have to give this message, I'm going to give it to all 50 people at once, but I have to follow up. I have to in one-on-ones with people or in small groups. I need to repeat the message, perhaps, partially because half the people were probably multitasking and looking at a different window and I didn't know.  Partially because they might not have resonated with the message the way I had hoped, and I couldn't tell, and I need to double check and then engage. And, so, that takes a lot more time for me, as a leader, to do so. And then I want to get their response to it. And then we have challenges such as even if I do that in person, I do that on Wednesday, well, at least we're all in the same room, I can get the real-time feedback. Okay, what happens Thursday when everyone's home? I could see the next day when they show up, "Yes, they were sad about those resignations yesterday but are they showing up smiling? Are they showing up unhappy?" I can't tell because I don't see them for another few days.  So we're getting effectively less signals when we're hybrid. And it's important to understand this and adjust our leadership and communication, to over-communicate and to look for other ways we can replicate those signals. But that takes a lot more time and effort. Adam:            It does take a lot more time and effort. And how can you take this more time and effort, and mentor your employees and also do your daily job. Because you're managing your people, but then you also have things that you have to do as well. Mark:             That is the $64,000 question. And when you look at the history of how we've operated, we had very hierarchical structures throughout the early 20th century. We followed the military model and you had managers, upon managers, upon managers. What we saw in starting the '70s and '80s was a flattening of the hierarchy, a gutting of mill management.  And that continued into the '90s and 2000s because we could automate. Because now we had all these great tools and, "Oh, I've got automated reports and it helps us all do our jobs faster." We got away with a flatter structure, unfortunately, I think we're going to see a shift. Maybe it's not unfortunate, it depends how you look at.  But I think we're going to see a shift that we are putting more responsibilities on managers in this hybrid workplace, and therefore we're going to need, effectively, more managers. The number of people being managed per manager just has to be reduced. We need more managers per employees, and that's going to be a shift we'll see over the next decade or so. Adam:            What do you think the long-term effects of this hybrid workplace are going to be on people? Especially, as we look at things like promotions and looking at strategies or even DE&I. I feel like there's going to be this long-term effect that we can't see yet. Mark:             That's a tough one, and we talked, in our prior episode, about some, for example, the DE&I challenges that if you set a fixed number of days, that's important because if you did a variable number of days. The people staying home more, the ones with more home responsibility, tend to be women and underrepresented people. So they're going to be in the office less and probably get promoted less.  On the other hand, if you fix it, the ones who need to be home more are probably going to leave for companies, where it's a lower number than yours. And you're going to have, again, a problem with your pipeline.  And, so, it's unclear which way this is going to move. I think we're going to see, as companies do, five days, four days, three days, two days, people will vote with their feet. Not just DEI people, but people in general, employees in general, are going to say, "We really prefer this versus that." For all we know, when we see teams doing, for example, Tuesday to Thursday seems to be the popular timing in the office, why? Because people want long weekends. Are we going to discover there's not a lot of productivity on Friday afternoons and Monday mornings? Maybe that's a problem.  Maybe we'll even find everyone says, "Yes, but Tuesday, Wednesday, Thursday traffic is bad. You know what? Let's do Friday, Monday, Tuesday. Because that way I don't have to worry about traffic because no one else is driving two out of those three days.” I think we're just going to see effects, and secondary effects, and tertiary effects as we're trying to adjust.  In physics, we think about this as a three-body problem. One body impacts another, impacts another, and it's very hard to calculate. And I think that's what we're going to see in the employment market for a while to come.And I'll say even on top of all this, there's one other issue, what I've said going back a year now, we don't know what the market will look like. People asked, "How long will hybrid work last? Is this here to stay?" Probably yes.  As we record this in the summer of 2022, we're on the precipice of possibly a recession. If it's a shallow recession or no recession, this will stay. And once this becomes the norm for somewhere around two to four years, it's likely to stay the norm.  There is a chance if we go into a deep recession, and with all the geopolitical events, with war, with energy, with supply chains, with return of Covid. If this comes back and we go into a deep recession, companies may say, "Five days a week, take it or leave it." Employees say, "Thank you, Sir, may I have another?" Because the labor market has just collapsed and that could undo what we've seen. I think that's less likely, it would take a prolonged recession in the next few years for that to happen. But that still is a possibility. < Outro > Announcer:    This has been Count Me In. IMA's podcast providing you with the latest perspectives of thought leaders, from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Connect with Kyrill: https://www.linkedin.com/in/kyrill-asatur/Full Episode Transcript:< Intro > Adam:            Welcome back to Count Me In. The podcast for accounting and finance professionals working in business. I'm Adam Larson, and today we're going to talk about something that is, no doubt, near and dear to you, namely, your money.  My guest is Kyrill Asatur, the CEO and co-founder of Centerfin. As a longtime advisor to hedge funds and other large institutional investors, Kyrill was often asked by friends and relatives for advice on how they could better manage their money. How the big shots on Wall Street do it? And for a long time, he didn't have a good answer for them because that institutional level of service and expertise, simply did not exist for individual investors.  This is the story of how he decided to correct that inefficiency, in the investment and management ecosystem through the power of fintech. This podcast is a must listen for anyone with a 401K and IRA, or any other investment accounts, which means it's pretty much for everyone. So let's get started.  < Music > So, Kyrill, thank you so much for coming on the podcast. I'm really excited to have you on. And I figured we could start off by just introducing you to our audience, and just so you can give us a little bit of background and your story. Kyrill:             Sure, thanks for having me on, Adam. So my background is about 20 years ago, well, a little over 20 years ago now. Out of undergrad, I joined, at the time it was called the Global Operations Division at Goldman Sachs. And it was an analyst program, three-year program, where I got to rotate through several different roles. And, so, I did that. I was in foreign exchange for a little bit. Then equities, and then decided to find an area of the firm that aligned itself with the hedge fund industry.  So I got, personally, very interested in the hedge fund industry, just always been reading about hedge fund managers. And at Goldman Sachs there's many different ways, as you can imagine, you can interact with hedge funds.  But the one business that was directly correlated, so to speak, with the hedge fund industry, was the prime brokerage business, which is basically serving all hedge fund needs. And Goldman had, and still does have, the kind of premier prime brokerage business, top three prime brokerage business in the country.  And, so, I was able to get myself a role in that business. So I was there for another six years, five, six years after that, after my first three-year rotation. And then I joined a hedge fund that I covered, they were actually ex-Goldman guys, too, and I was with them for another five years.  Ultimately, I got recruited into a couple of different roles with other firms, and decided in 2016, so now about six years ago, to start my own advisory practice. And initially focused on working with hedge funds and other alternative investment managers, very organically and really through, as they say, necessity is the mother of all invention.  I decided to start what is now Centerfin. And the idea was really because over the two decades or so that I've been working on Wall Street, I've always struggled to help friends and family that will come to me and ask me about what to do with their money. So they might have a retirement account, or a 401K, or just savings that they've saved up, that they would like to invest. And, frankly, I just never saw any great options out there that I can point them to.  And having spent my whole career, or at least the biggest part of my career, interacting with large, sophisticated, institutional investors like pension funds, endowments, foundations, family offices. I, basically, learned the way that they invest their money, and it was very different than the options that were available for if you're an average Joe or Jane, so to speak.  And, so, Centerfin was founded to address that need, in my mind. And we're basically two years into it, a little or two years into it. We went live at the beginning of this year. We have a tech-enabled, kind of tech-forward service. And, so, we spent a bunch of time building it, but we went live at the beginning of this year and growing nicely in these crazy markets. Adam:            Yes, the markets are very crazy with everything that's happening, the inflation. And in the past three years with the market, the way it's going, I know it's been really crazy for everybody. And I know organizations, and our focus will probably be more on organizations and people within those organizations.  I know organizations are looking to invest and trying to build their wealth. As well as they're trying to keep above water in this industry. What do you think the future of finance is looking at as things are, continuously, changing and the finance team has to adapt as they go along? Kyrill:             Yes, absolutely. So really technology is playing a bigger role in everything. So one of the reasons why we started our company and the way we structured it, it was because we felt like technology was something that could be used to just create more efficiency in really any process.  But, for us, it's the investment process, managing people's money. And by "Create efficiency", I just mean do things in a way that are cheaper to the end consumer. So for us it's an individual. But this works all the way up and down the chain internally at an organization or externally depending on we all have clients we serve. And, so, I think technology is a major, and you've heard about it, people have referred to it as fintech. It's finance and technology combining, and the interesting thing is that it's still early, quite frankly. Because I do think that technology is making its headway in helping create efficiencies in organizations, and processes, and procedures. But, quite frankly, most of the financial world infrastructure is still what existed 20, 30, 40, 50 years ago, in some cases. And, so, there's just a lot of opportunity. Adam:            There is a lot of opportunity. And as you mentioned there, a lot of the systems that are in place, are still the same things that were built years ago.                         Now, is it more advantageous to go with a solution that may be more digitally native, that doesn't have the backbone of the original structures, but it's trying to be more agile and adaptive with technology advances? Kyrill:             Yes, I think it's absolutely advantageous. So I actually was having a conversation with a former colleague this morning. And what struck me is that even when you try, and this is somewhat by design.  But even when you try to structure your business in a way that's very customer-driven. And that's really our ethos, is that we really want to focus on the customer. What's the right thing for the customer, for the client, for the investor? And even if you try to do that it's hard, oftentimes, when you have legacy partnerships. And, so, our perspective was always find the right partners that have the technology and we spend a bunch of time, obviously, finding them. And then build our own technology, that's completely new.  So it's not building on top of something that is maybe legacy 20 or 30 years ago. Which is what often happens in bigger firms, bigger incumbent firms. But build something completely de novo, as they say. And by doing that, and by focusing on, like I said, efficiency, cost, I mean, you're able to pass that through to the client. Adam:            That makes a lot of sense, and you're able to kind of, in a sense, be more agile. Which is what you're looking for, especially in fintech, you need it to be agile because you have to adapt as you're going along, right? Kyrill:             A hundred percent, yes, a hundred percent. I mean, any kind of new firm you have to be agile, but in fintech, it's very important. Adam:            So can we talk a little bit about how this type of software, these type of solutions, will affect the accounting and finance team. As they're trying to adapt within their organization. Kyrill:             Yes, so I think that accounting and finance folks, it depends on at what angle you're looking at it through. I think just on a personal level, so every professional, or non-professional, but accounting and finance professionals, have their own retirement savings accounts.  They have their own taxable savings accounts that they've been able to accumulate. Using technology, using software, to help things will just make those solutions better, just solutions that are available to them better.  And within their roles, the use of technology, kind of, more broadly speaking, should also make their jobs less labor-oriented, so to speak. So when you can use technology, and, actually, as now I'm reflecting on this. My early days at Goldman Sachs, I was in operations, it was referred to as the back office, so it was everything that wasn't the front office.  So once a trade gets done, it comes down to us and we handle it. And we were very encouraged to develop processes and procedures to make what was, at that point, referred to straight-through processing. So that there's very little manual intervention.  And, I think, fast-forward two decades, again, for a long time lots of things were being cobbled together. But technology just makes that trend so much more powerful today. And that's going to have a real ability for folks in those seats, to do higher value type work. So to do less stuff that's a little bit more manual and labor intensive, and focus on things that are potentially higher value. Adam:            Yes, definitely, and I was reading some stats. There's hundreds of billions of dollars going through fintech every year. Do you think that that's going to continue to grow as more and more people move in that direction, especially as the technology grows? Kyrill:             I think so. I mean, obviously, we're going through a period of time, right now, where we went through a period of time, not to take too much of a step back. But we went through a period of time where money was abundant, to put it pretty simply.  We had, in response to Covid, the Federal Reserve and other global central banks printed a lot of money. You've seen this in the press over the years, it was there. It was done to stabilize the economy. It was done to stabilize markets, so that we wouldn't go into some version of a depression.  And that money, eventually, finds its way into speculative ventures like startup fintech companies. And, usually, what happens is that, the more speculative the more you'll see capital flow into that stuff. So you saw it in crypto, in NFTs, and advertisements. I'm sure you've seen advertisements for investing in art, as an investment, or wine, or things of that nature. That's very typical of late-stage behavior in a market cycle, and we just went through that and now the air is coming out, so to speak.  But that being said, as it relates to fintech specifically, I do think, well, it's probably healthy to have some decline and growth in the capital that flows into the industry. I do think it'll continue to be an important area of focus, simply because it is really hard.  Not impossible, but it's really hard, internally, at least in some of the big banks that's, kind of, where I grew up to innovate that much. You can make adjustments on the margin, but if you want to take a very different approach, it's hard to do so. And, so, for that reason, I think, that money will continue to flow into fintech. Adam:            Yes, so thinking about individual employees within organizations. What role do you think that employers should play in helping with their employees' personal health, financial health, because you want to keep your top talent. You have to connect with a good fintech company to make sure your investments are good, to make sure all that stuff's flowing. What role do you think that they can play in that? Kyrill:             Yes, it's a great question. We actually think they should be playing a bigger role. So most companies, most larger companies, offer retirement services. So they'll have a 401K plan and they'll do a matching grant up to a certain percentage of what you put in, or of your salary, and whatnot, and it basically stops there.  I mean, at least, I've seen some of this, recently, I think some larger companies and corporations are embracing a more holistic approach. So offering their employees, whether it be managing their student debt, or their credit card debt, or thinking about not just their retirement assets. But if thinking about how to plan to save for a home or to make other investments outside of their retirement world.  So I think that that should be something that big companies and corporations are offering their employees. And it's not very typical right now, as you probably imagine. So what about the small to medium-sized business? Who doesn't have the big resources, that the big corporations, that the examples you just gave. What options do they have for helping regain top talent, when they're small, trying to get themselves or they're just not a large business, but they're trying to get good people?  Kyrill:             I think they're a great candidate to work with fintech firms, relatively younger firms like ourselves. I actually, in a very early deck for Centerfin, I put something at the end that said something like, "Eventually, we will hope to be a perk a company can talk about, to prospective employees or existing employees." And the reason I say that is because what we do is very technology enabled. Again, we can do it fairly quickly and we can do it at a cost that is a fraction of a traditional provider. And it's, solely, because when we were founded, how we were founded, what our goals were, and we're not the only one. I mean, there's folks out there that are talking to, it's becoming more common, but it's still very early. Adam:            Yes, that's great. It's great that they have an option because sometimes these great options are available. But the small and medium-sized businesses are overlooked because they may not have the immediate capital to invest in something like that. Kyrill:             Yes, absolutely, and I think it is a big, again, if you're taking on something like a 401K, it's not an easy thing to set up. We do manage retirement money; we don't necessarily manage 401K accounts. It doesn't mean we can't, but I bet if that's something that somebody, a smaller business wanted for us to do, we can probably get it done fairly cheaply. Adam:            So when thinking about just personal finances, everybody has their own struggles. There's, obviously, issues in the United States. There's issues all over the world with different personal and financial problems. Do you think that the emerging fintech technology can help solve some of those problems, that people are running into? Especially, thinking about different types of investments, and building that wealth that everybody desires? Kyrill:             Yes, a hundred percent. So it's why we started what we started, when we started it. Because, especially, today the investment approach of the last couple of decades, let's just take that timeframe. Because that's the timeframe I've been working in, where most of my contemporaries, as they develop wealth, have been managing their money.  There was a fairly, not easy, but a choice of using a very low-cost index fund, obviously, pioneered 40 years ago by Vanguard. It became a very easily to implement and accept strategy for lots of individuals, for their personal finance. And it makes all the sense in the world, except it made sense in the market environment, that we were living in post-financial crisis up until Covid. And the reason I say that, is that you mentioned problems, and problems not just here but globally. Well, there are a lot of problems, and I mean, there's always a lot of problems. But the world is always changing, but the difference between now and the prior, call it 12, 13, 14 years. Is that we are seeing things that we haven't seen in 40 or 50 years, and by that I mean things like inflation.  I think before we started recording we touched on it briefly. But inflation is not something, at least, in the U.S. that we've seen since the 1970s. So nobody of our age or younger has any direct knowledge or experience with inflation, and how markets work with inflation. And even the professionals, obviously, that are managing money don't have experience with inflation. But one of the things that we do, given our background is in the hedge fund industry, we're still pretty plugged in to that world. And there is a whole slew of hedge funds whose role is to manage money on a global macro basis. So all they do is try to interpret these things, where, "Is inflation a problem? And if inflation is a problem what do you do and what does that mean for traditional investing?" And, so, I think in today's environment, and it's very recent, and potentially has staying power, you really need to be cognizant of inflation and the effect it has on traditional investing strategies.  And, so, that's one of the things we talk to our clients about, we write about, is that the low-cost ETF approach made all the sense in the world, from, call it 2009, even if you want to fast-forward to 2021, at the end of last year. There are some real scenarios out there, and smarter people than I have talked about this. But there were some real probabilistic scenarios out there that, that approach, just buying a very cheap Vanguard equity index fund could yield no to negative results over some foreseeable future.  So what's not often talked about is that that approach from 2000 to 2010, a whole decade, yielded no return, you actually lost a little bit of money. And it's not widely talked about because it's not convenient to talk about it.  But the truth is that if you tell somebody today, "Hey, listen, if you start investing and in 10 years you're not going to have any more money than you started with. You might have, on a real basis, less money because of inflation." They're probably going to be surprised by that. But that's really the world we're living in right now. Adam:            So, basically, what I'm hearing you say is that if you're going to start investing, if you are investing, if you have investments right now. As we look at the inflation that's happening, start educating yourself. Start having conversations with whatever company you're using to invest because we need to talk about this.  We need to learn from history because the people who were working at that time, when the inflation was hitting, they're probably retired or they're doing all that stuff, are retiring now. And, so, we need to find that balance because we need to get that education out there. Kyrill:             Yes, 100%, that's what we would recommend is talk to a professional, bring it up. All these big organizations have economists and they all have opinions on this, that, and the other.  However, again, none of them, maybe very few, but none of the ones that I see on TV, every day, were actually alive, or adults, when the last time we had this kind of environment. And not that we were, but what we try to do is educate ourselves so we can help our clients navigate this environment better than just what has been working in the recent past. Adam:            Now, do you think it's up to the employer, who is providing this to their employee to provide that education? Or do you think, as individual people, we should be researching that ourselves, or is it kind of like a dual? Kyrill:             I think it's in line with what I said earlier about employers providing their employees with resources, that are above and beyond, what historically, was thought to be enough. More so today than in recent past, that advice is really valuable to individuals. And I'll give you another example, so cryptocurrency, a very popular topic. It has been around for just over a decade, but really has gotten mainstream attention, probably, over the last five or six years.  And I, like everybody else, heard of it when it first became more popular. I started to research it myself, or myself started to think about, "If it makes sense?" Came to the conclusion that, "I think, there's something there, but it's still early, it's risky." And, so, when I think about how much money to put in it, it has to be small. In my opinion, especially, five years ago when I first got involved. It's not any different than gambling with potentially huge returns, but also potentially huge losses.  And, so, any friends and family, and again, going back to my motivation for starting Centerfin. Any friends and family that would come to me, over the years, before we started Centerfin, and say, "What do you think about Bitcoin? What do you think about Ethereum? There's this other token that I heard about?" I tell them all the same thing, "I think Bitcoin and Ethereum are kind of interesting, but make a small allocation. Call it one to 3% of your overall assets that you invest and see how it goes, and keep yourself educated, but don't over risk it." And then you hear, in the press, as crypto went boom and bust, a lot of other speculative assets in the last cycle. You hear stories that make me really sad, and it's not because people are stupid by any means, it's just they're just not educated on it.  But you hear professionals, in various different fields, that put 90% of their savings into a token that then went to zero. Or put it in a platform that wasn't researched well and it went bankrupt. And you hear these stories time and time again, and I think it affects hundreds of thousands if not millions of people.  And if that person's employer gave them a resource, where they can go and ask that question, and get professional advice, maybe they would've avoided that. But now they're potentially in a catastrophic situation for themselves and potentially their families. Adam:            Yes, I can see how that could happen. So, anyway, as we wrap up the conversation, I just wanted to kind of get your view, Wall Street looks one way right now. We have a number of exchanges, and we've got stuff in Congress for possible other exchanges, for smaller companies that could be going through. What's your view on Wall Street right now, and how do you think it'll look as we go into the future? As things are constantly changing? Kyrill:             Yes, it's a great question. I think there's a movement, and to your point about exchanges for smaller companies. I think there's a movement to make the products that Wall Street generally pedals in more available.  So that you hear, and I don't like this term, but you hear a lot about democratization of certain things. And it's meant to mean that you're leveling the playing field. Allowing a wider audience of companies and individuals to access certain products and services. And, so, I think that that trend has been going on for a long time, that will continue. I think, to speak of crypto, actually, I think there are a lot of folks in the crypto, blockchain space, that think that the technology of blockchain will play a big role in, which is really just a technology, but it will play a big role in the rewiring of some of the guts of Wall Street. And that could mean really good things for the end consumers of their products.  And there's lots of folks in crypto who think that crypto is the parallel Wall Street, a parallel financial system. I'm a little less inclined to believe that, although, I do think there's some elements that make sense. But it's just very hard to get your arms around it given, it's a highly regulated space, it's global, and it's just hard to get there.  But I do think that there will continue to be a trend and it'll be good for everybody involved. In creating, more efficient, more widely available products and services on Wall Street. And, so, yes, I think that that's going to continue and I think it's going to be good for everybody involved. Adam:            Yes, and maybe even something that could help distribute the wealth a little bit more. As opposed to just elite few who make small moves and it moves the market in a crazy way as opposed to allowing for others to get involved, as well.  Kyrill:             Yes, a hundred percent, I think that that's part of it. I think the other part of it is, I'm a big, you've heard me talk about it now the whole time. The way I see the world, and I don't know if this is too simplified, but the way I see the world is that, at least, let's focus on the U.S., the reason the U.S. is so special is because we have this free market system. We have capitalism. If you wanted to start a business, you can go and find capital and use that capital to build your business.  The capital markets, the access to that capital, is what Wall Street largely controls. And I do think Wall Street as it looks like today, is just a very big, to your point, about distributing the wealth. It's a very big drain of, generally, expenses that take a big bite out of those capital markets.  But the basis of those capital markets is actually our money. So it's your retirement funds that are in a pension account. It's your savings that you've put in the bank, even the endowment, wherever you went to school. Let's say you contributed to the endowment to help out. That's your money that you've just given to your endowment. And, so, the basis is the capital that runs the capital markets is all of ours. And Wall Street is really just a machine that helps create efficiency in those capital markets. And I think that that can be done in a much better way. And we're addressing it in one little small niche, but I think that trend will continue as well, and that's a big part of fintech. < Outro > Announcer:    This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders, from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Connect with Robert: https://www.linkedin.com/in/robertbendetti/ Check out IMA's Statement of Cash Flow TutorialFull Episode Transcript: < Intro >Adam:            Welcome to Count Me In. The podcast that brings you an insider's look at accounting and finance professionals working in business. I'm Adam Larson. My guest today is Robert Bendetti Jr. Robert is a CPA and the CFO of Lifecycle Engineering, and he joins me for a high-energy discussion about cash flow management. He shares timeless wisdom, he learned from an early boss, to how he uses the latest technologies to optimize his entire cash flow process. This is one of those inspiring podcasts where you can tell the guest is not only a true expert in his field, but passionate about helping others take their skills to the next level. Enjoy.  < Music >Robert, I want to thank you so much for coming on the podcast today. It's really exciting to have you on. And today we're going to be talking a lot about cash flow and cash flow management, which is near and dear to the accountant's heart. But before we get to that, I just wanted to start with if you could just tell a little bit about your story and how you got to where you are, and then we'll continue the conversation from there.Robert:           Adam, pleasure to be here. Cash flow management is my favorite topic and always has been. I describe myself as a CFO, husband, father ultra-runner, and when I'm doing all of those things, I'm thinking about cash flow management. I don't know about everybody else, but it's certainly important and it seems like everywhere I work it has been important. Yes, a little background, I've always done corporate accounting. I am a CPA and member of the IMA, best org ever. But I never worked in public accounting, it's always been corporate accounting and the kind of standard internal individual contributor to manager, director, to VP, to CFO.Adam:            So what is it about cash flow and cash flow management that excites you so much?Robert:           Really early on, I had a boss tell me, and he stole this quote, and I don't know who said it originally, "Revenue is vanity, profit is sanity, cash is reality." And it just really stuck with me that everything else is just fun and games, until we actually get paid cash. I cannot pay payroll with your hopes and dreams, your purchase order, your good meeting. The only thing I can make payroll with is cash.Adam:            That's very true. And speaking of cash flow, IMA has a Cash Flow Management course, that I know you took. So you can take that course and you can learn the basis of cash flow management. Which most accountants do know, but they probably forget, depending on what their job role is. But then what happens?Robert:           Yes, first I'm going to plug the course, free CPE for IMA members. I am, like many CPAs and CMAs, always delinquent in getting my CPE. It's two months before the time to send in the paperwork. I'm like, "Ha! What? Do I have to do that again? Is that every year?"I don't know how I've forgotten it for 20 years. But, yes, I love it when there's free CPE, as a member of the IMA, and, yes, Statement of Cash Flows tutorial. Great course, one hour, little hitter is a fantastic reminder on the foundation of the cash flow statement and how important it's. But to, "Now what?" It started to get my creative juices flowing, and I started to think about also the framework of the days of the fast, cheap, easy money might be over. That we might look back at 2010, '18, '19, even '20 as the good times and that the future '23, '24, '25 might be rising interest rates, recession, it might be inflation all in the same stew. So no time better than the present to get your cash flow in order.Adam:            So how do you do that?Robert:           Number one, I think is, obviously, the cash conversion cycle, CCC. That’s the foundation and, yes, check mark. And I'm not going to cover that because we're a bunch of accountants. But next, maybe 102 level accounting is going to be; you need to review your customer and job selection for profit and credit worthiness. A lot has changed in the past two years and maybe you looked at it pre-pandemic and you understood your customer profitability, project profitability. Or you understood your job profitability, or your customer credit worthiness, a lot has changed. Somebody that was credit-worthy before may not be in the future. And, so, I think right now is the perfect time to be checking those things. Number two is what are your policies and procedures around job or milestone, invoice timing, and, for that matter, what's your invoice processes like?Well, did it used to all be physical and now you're fully remote? Did it used to be lean and now it is cumbersome? That's the number two thing. And then the third thing is collections, not everybody likes collections. Some people find that it's a little uncomfortable to, "Am I being annoying? Am I being rude? Will the salespeople not like me?"You need to stop caring, there is somebody on your team who is a little rough around the edges, and that is the perfect person to promote to leader of collections and to be right on top. Because the squeaky wheel gets the grease and you want to get the grease, you want to get the cash. As maybe we are entering into Q4 '22, and '23, and '24, maybe we're entering into some tough financial times, if not you, potentially your customers.Adam:            So as the customers enter that tough financial times. As we're looking at rising interest rates, and all the different things that are affecting us. What can accountants do to prepare for that? You just mentioned some things that they can do. But I imagine that there are other elements that they would have to do like technologies, making sure that all their systems are in place. Making sure all the regulations and all those things are in place. But what recommendations can you give them as we look to that future? Because it's not going to get better yet.Robert:           Yes, I'll give you level one and level two. Because sometimes you skip level one because you assume everybody's doing it. But maybe there's one person on the call that isn't. Level one stuff is just to remind the team that it's really important, that maybe you got PPP money, or customers were paying you early. You're a government contractor and the government was paying you in seven days instead of 27 days. That's not going to happen in the future and I know everyone's overtasked, and they are super busy with other things. Level one is just reminding the team, "Hey, sending those invoices out on time, collecting on time, confirming everything on time. Know our customers are not going to pay until receipt of a valid invoice." Just that basic reminder of the importance. Number two, is having a conversation with your key salespeople. Your sales and growth leaders, reminding them that; "Revenue is vanity, profit is sanity, and cash is reality". And that means the two best salespeople, just reminding them, "Hey, I'm your friend. I'm your biggest cheerleader. I'll give you anything you need, but it is important that these people actually pay us. Let me know if you hear anything, any words on the street about any pending doom because you'll know before I will."And then also talk to your worst, two salespeople, you know who they are. The ones who cause all the trouble and remind them, "Hey, I'm watching you. You are not my favorite, Julie and Jessica are my favorite. You are a troublemaker and I'm watching you, please don't ruin this for me, it is important that we get paid. It is not important that you had a good meeting or that you got a purchase order, it's important that we got paid. Do not be promising payment terms that I'm going to deny."So those are some basic, super basic things. And, then, yes, technology is super key here. If you do not have a system that automates this for you, they are out there. You need to talk to the many IT vendors who are trying to help you. Or if you have a platform, but you haven't purchased that module that automates all this for you, because you just haven't gotten around to it, this is the time to get around to it. There are some amazing tools that can do a lot of this for you. So this is the time to look out for that. Or maybe you're like, "Hey, Robert, Adam, I've talked to the accounting team, I've talked to the salespeople, I got that on lockdown. I just integrated and updated IT. How about training?"You might have the tool and you might have the talent. Do those people have the training? Did you used to have...?" Now, that you're like, "Oh, yes, we trained them last year. Is there anybody from last year still around?""No. Oh, they're around but you promoted them.""Mm, well, they're not doing cash flow anymore. So the new people, have they been trained?"So I think training is really key around here. And, then, also, in this area is if you think, "Oh, man, I am overtasked and under-resourced, I don't have time for any of this." Think fractionally; where do you have a little pocket within the totality of your organization that can help in this? Think that. Or there are people that have had 20, 30 years of experience and they've kind of semi-retired. They are a fractional, virtual resources that can help you. Your system is completely virtual people can work from wherever, and you're like, "I only need somebody to do this, four hours a week."Oh, my gosh, there are tons of resources available. If you don't know them, your peers know them. They could be former employees; they could be people in industry that you've met at conferences. You're like, "Oh, I was just talking to Barbara and Latasha, they recently retired, they were awesome. I bet they would work for you for four hours to do this."Adam:            Hey, Robert, can you give us some examples about how technology, and all of these that you've been discussing, can help the team.Robert:           Two things come to mind; one is just integration of systems. I've worked at a couple of companies and this one, my present employer, have had seasons, where things were not integrated. And the pieces of the puzzle that have to talk to each other, were automated until it needed to jump to the next system. Automated till it had to jump to the next system. And then there was a physical person in between those processes, and that is unbelievably inefficient. Especially nowadays where people are remote or fractional. I've got people who have flexible schedules. So some people take every other Monday off or every other Friday off. And it just seemed like they were always in the middle of an approval process on the every other Monday. So instead of processing an invoice in three days, it was taking seven days because people had a flex, and technology is there to resolve these issues. And sometimes the systems themselves integrate and it's a great benefit of using an ERP, sometimes they don't. Maybe you, at your current employer, you're using just the best-of-class contracts tool, best-of-class accounting, best-of-class tools and, so, you need them integrated. There's external IT resources that'll do that.One thing I've found real benefit from is bringing that talent in-house. I think the importance of somebody understanding how your systems work, and mapping, and bridging these are so critical. That it's an absolute requirement to have that technology, that skill in-house, and not necessarily an obvious skill in your standard IT group. It's not exactly networking, it's not helpdesk, it is that integration and mapping. But very often I've found people with the same data analytics skills, they have a passion around turning data into the actionable information.They've got the skills to be able to integrate these systems and connect them, so that is really critical. And then these just some cool bolt-ons that I think are really helpful. Cloud-based tools, and you can find a lot of information around collections and credit, in particular. And I'll just give you two examples that are coming to mind; one is there are credit watching services. Back in the day, you had to physically type in a name because they were a new customer and they'd give you your report. Now it does it automatically and they will send you a color-coded report, on all your existing customers or any customers that are in your CRM pipeline and just let you know red, yellow, green. So you can manage by exception, I think that's really great.And then another tool that I found that's really helpful, that my salespeople were using. I was paying for, and I didn't have a license, nobody in accounting, but they were raving about an online tool they were using to get contact information. Cell phone numbers, business phone numbers, email, personal email data. People were posting on the internet about companies. We got a couple of people who do inbound and outbound sales, and they were talking about, "Oh, please don't cut this off. We think it's great, it gives me all this stuff."And I was like, "Oh, that sounds really good. I could use that for collections." When somebody's supposed to approve something or pay something, and they're not responding and I need more contact information or I want insights into the company and I want to set up for alerts. So I was like, "I will pay for this cloud-based sales and growth research tool, if you'll give me a seat. And now I have a license to the tool and I'm just typing in there.I found out, alarmingly, accurate stuff on Robert Bendetti. And if you're ever wondering, "How are these people finding my email address, my cell phone?" Email me, call me, I'll tell you where they're getting, and I have a license to the site now.Adam:            Hmm, it is just alarming on how much of our information is out there and unless you're living under a rock somewhere, your data is there. It's quite alarming. It seems that collections seems to be the only thing that can't be automated, honestly, when you think about it.Robert:           I think it can. Actually, I'll challenge that. Adam:            All right.Robert:           And I'll illustrate it by something we all are burdened by. Have you noticed, Adam, that when people are trying to sell you something. There is an obvious schedule, an email schedule, how they are going through a process of first contact, second contact, third, and fourth? Adam:            Yes.Robert:           And then the fifth one is always, "Oh, have I reached the wrong person, Adam? If you're not the person who makes these decisions, could you recommend who I should?" And then the sixth, I mean, really final email is that… "Hey, just pinging you one more time." And trying to be funny. So it's just an email automation tool for inbound and outbound marketing. So those email automation, the same exact tool and principles can be used for collections.Adam:            Hmm. Robert:           Everybody, who's listening, has a process that; "Here are whatever my standard payment terms are at..." Well, I'll just say my company, there's the reminder, but just before it's due or when it's due. Then it's the day after it's due there's another reminder, and then escalating over time with escalating words. And there's a number of emails and then there's phone calls. You don't have to just remember that process, you can set up a bot to automatically do that. "If this happens, then I want this cadence to automatically happen." You don't have to touch any of it until the phone call. And it's even possible to automate the telephone call and when somebody actually picks up and Adam says, "Hello." Then a human would ring their phone and they'd have to pick up.That's kind of hard to automate that step for accountants, but it is possible, all of that is absolutely possible. And you don't have to do it yourself, you can pay someone. If you're large enough, you can just pay a firm to do all of this for you, the entire process.Adam:            So I guess I can stand corrected, because the way you had originally described it, it seemed like it was the only kind of a manual process. But it sounds like you can automate things. And, so, everything that you're describing is RPA, Robotic Process Automation. And, so, maybe you can describe a little bit for our audience the importance of RPA and other AI elements within cash flow. And how important that is to being part of the future?Robert:           Yes, I think, it's supercritical and it's important right now more than before. There was a big push towards lean accounting over the past 10, 20 years. We've all taken the classes, I mean, it's lean. Our principles are not just applicable to manufacturing and operations, certainly, applicable to accounting. But a lot of our lean processes were lean when we were all physically next to each other, and not potentially either lean for the digital age or lean for the new process of being hybrid remote-flex.I know my company wasn't, I can only speak for myself. We were lean for an old way of doing business, not the future way of doing business. So I think that is a foundational piece. Drucker famously said, "The worst thing you can do is automate a process that should never be done."So don't skip that step, re-look at your processes and procedures. Do you have procedures? Are they written? Are they the best? Are they being followed? Then lean them out, lean those steps out. There's something between 80 and 95% waste in all processes. Don't be surprised if you find waste. Be surprised if you don't because you did it wrong, if you don't find any. So don't skip that step. We all like to skip step one, I'm a big proponent of don't skip step one. And then, secondly, so it's lean, lean-ish. All right, now, process automation. Automate those steps within that process so that humans are not having to touch every piece. It's really hard to come by humans. It's hard to find young people who want to work in accounting and be at a desk. So, I mean, maybe you have an overabundance of accountants at your company, please share because the rest of us don't.So take those manual steps off of their fingers, process automation. The ERP that you bought, the accounting system, the contracts, HRIS, ATS, those tools already have it. If you're not using it or if you haven't purchased it, put that justification for the capital project and get the boss and the boss's boss to sign off, process automation. So then that's step 102, 101, 102. Next step is just because in its own little pool, you have process automation within one step, that's robotic process automation. I think of the difference between… I remember being super impressed that I created a macro, that I would when I was 20, 22. It was the reason I got my first promotion is I had to download a bunch of stuff, and then format it, and then send it out.And I created a macro to eliminate all the timing of formatting and creating the visualization of the data in Excel, by the way. This is like one step away from stone tablets, people, I'm 47 years old, and it was revolutionary. And instead of taking four hours, every Monday, it took 10 minutes, 20 minutes or something like that. And then I also came in early, nobody knew that, so that all these reports went out to my division before the engineers showed up versus all the other bean counters they were sending their stuff out at noon. And, so, I got a reputation as being this amazing lean accountant when it was just a macro. Well, my FP&A and data analytics folks, it takes like no seconds. They don't download anything. They don't have to format anything. They don't attach anything to an email and don't decide who it goes to. RPA, all they have to do is identify what needs to get done, under certain parameters, and the tool downloads the information formats, and then attaches to an email that is pushed out to a distribution just based on authority. So if people come and go, it doesn't matter, it's just the authority group. And then they don't have to touch anything, it takes, I think, four seconds might be an overstatement, RPA. All stuff I thought was cool, I mean, I liked doing it, but there's other value added stuff I could be doing like collections and, so, that's RPA.And then IA, machine learning, that's like the machine suggested that this is a report that the executive team needs to see. And it suggests, for you, things that you're not looking at. Here, I through this dataset, have identified exceptions and is pushing that out to you. You don't have to pull it, you don't have to request it, it's pushing and suggesting because you've given the dataset some parameters, "Hey, I like to see exceptions."Well, then it'll suggest some exception management to you. That's exciting and new age, and where we're moving. I started and I'll end with all businesses are digital businesses, and if you're not, you're going to get left behind. If you don't know how to do this, you're going to get left behind. But you don't have to do it alone.Adam, I think we've said, all along, there's tools and or there's talent you might have on your team, you just need to equip. They might have a passion around this and you might just be able to say, "Hey Latasha, Julie, you're in charge of this, I'll support you. Tell me what you need, let's go." Or fractional, bring in some fractional resources that know how to do this if you're that medium-size company.Adam:            Yes, I think we all felt that same way when we made our first macro, when we were in our early twenties, honestly.Robert:           Yes, gosh, I literally got a promotion for that. And new age, now we live in a different time. I have conversations with my internal team, to talk about digital and data management around, and we're not perfect, I'm not preaching, we do not have this all together. On the example of a pain point is internally we're a Microsoft Office and we use Microsoft Cloud, Azure and we're a Power BI shop, and a passion around that. External, a different team, sales and growth, they like AWS and Amazon and Onesite, for data analytics. Yes, those are two different tool sets, two levels of mastery. You'd think like, "Don't you use the same thing inside and outside?" No, we don't, so we don't have it all perfect. I am a work-in-progress and every company, we all work out, all the listeners, I'm sure even Adam and the IMA, we're a work-in-process, we don't have it all figured out.Adam:            Oh, yes, we all don't have it figured out. And I think the goal would be to how can we have all of our systems talk to each other in a better way, so that we can better help our customers. And, essentially, the topic of this podcast is so we can have better cash flow management because cash, until you get your cash, you can't do anything, like you said in the beginning.Robert:           So important now, and to test the importance of it, just a closing thought, Adam, I think is around test your assumptions. You just completed a budget or within the next quarter you will create a budget, and now more than ever stress test your budget, and then stress test that not only for profitability but for cash flow. Because there's a chance things are much worse or could be much worse than you think.Everywhere I've worked, 20% of the products, or services, or SKUs drive 80% of the profitability, and it's important to know which one. Which are those 20% of SKUs that have that big of an impact? The clients, the SKUs, the products and services, and stress this what if that industry or that customer was really impacted by changing interest rates or by a recession inflation? And what would that do to your budget and, in particular, your cash flow. This is the time, this is a call to action, as I leave, to stress test the budget for those key assumptions.Adam:            Well, I think we'll end on that. Robert, thank you so much for coming on the podcast today. Your knowledge and expertise, I know, will help our members and all listeners. Whether they're a member of IMA or not, as they continue on and become better accountants.Robert:           Well, they better join the IMA. They have excellent conferences and an excellent podcast. Thanks for having me on, Adam. < Outro >Announcer:    This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in, for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Connect with Jennifer: https://www.linkedin.com/in/jenniferreneesmith/Learn more about Scribe: https://scribehow.com/Full Episode Transcript:  < Intro > Adam:            Hello and welcome to Count Me In. The podcast that explores the world of business from a management accountant's perspective. This is Adam Larson, and today my co-host Neha, is talking to a woman who describes herself as an accidental CEO. Jennifer Smith is the founder and CEO of Scribe.  A software company that helps businesses capture and scale the expertise of their top performers, to drive new levels of productivity. From fighting collaboration overload to leveraging RPA, to attracting the right talent, Jennifer discusses how her obsession with efficiency has fueled her unique and unplanned leadership journey. Let's start the conversation.  < Music > Neha:              Welcome to Count Me In, Jennifer, it's such a pleasure to have you on the show. Jennifer:         Thanks so much, I'm excited to be here. Neha:              Awesome. So first things first, you call yourself an accidental CEO. Tell me more about that and what brought you to this point in life? Jennifer:         Because if you were to ask me 15, 20 years ago, gosh, maybe even five, seven years ago, "Would you ever be CEO? Would you ever start your own company?" I probably would've laughed at you and said, "No." It's not something I've ever thought about. I don't know anyone who does that, that's not in the cards for me. I started my career as a management consultant.  So I was at McKinsey for seven years. I worked mostly with financial institutions in the Oregon operations practice. Which functionally meant I would spend nine to five sitting next to agents, in operations centers, looking over their shoulder and watching what they did.  And if you ever do that work, you learn the name of the game is you figure out who the best person is. And you sit next to them and you say, "Well, what are you doing differently than everyone else?" And you find that they've found better ways of working. They would say, "Oh, I was trained to do all of these things, but here's how I do this better." And they would show me, they're all tabbing, they're doing really fast things on their computer. They became whizzes at finding these shortcuts and these very complicated pieces of software they were using.  And, as a consultant, I would dutifully write that up and sell that back to my client. But I always thought like, "Gosh, if we had a way to just capture what these people knew how to do. They could have had really big impact on that op center. They could have helped their colleagues all be better." And I said, "Well, it's an obvious problem, someone will solve that someday, surely." And then, you fast-forward 10 years later and then I'm working in venture capital, and investing in enterprise software companies. And I spent a lot of my time talking to buyers of enterprise software, again, folks in financial services. Just trying to understand like, "What are your open problems? What are your challenges? What are you trying to solve?" And this idea kept coming back. People saying like, "Oh, gosh, well, I or my people are spending a lot of time doing similar tasks over and over again. And actually they do it differently, it's definitely different between people, everyone finds their own way." Sometimes it's not even consistent within the same person. They do something once a quarter, they don't quite remember it, they try to do the process, especially, if they've a very complicated software.  I'm like, "Wouldn't it be really nice if there were a way to just know what was the best of what everyone knew how to do?" And I don't really have a way of doing that today. My only option is to tell someone, "Just take time away from doing your actual work and please generate a document that shows what you know how to do." That's not a very popular request.  And, so, I looked at it and said, "Gosh, technology has gotten so much better. It's so many years later and we're still facing the exact same problems." And I shifted from like, "Someone should do something about this." To, "Well, I don't think anyone is doing anything about this and they should, so I guess I'll do something about this." And, so, I very much did not intend to start a company. I cared a lot about solving a particular problem. I'm obsessed with efficiency. And I just saw a massive inefficiency in how millions, hundreds of millions of people around the world are spending their nine to five, trying to navigate these complicated pieces of software and trying to do it quickly, because everyone's got a million things going on and everyone's just doing their best. But most people are doing it sub-optimally and it's taking them more time, and they're spending a lot of time even just trying to figure out what to do, that's not a good feeling. And, so, I said, "Well, gosh, if I could solve that for people, why would I do something else? This feels like what I should be doing." And, so, I started my company, Scribe, three and a half years ago now. Neha:              Wow, that's really insightful and thank you for connecting it to common business problems that we are all facing every day. So this reminds me of a conversation I was having with my daughter, she's 10 years old. And I was telling her about coming on this interview and meeting you, the CEO of the company.  And she was very curious, of course, about the company and your work. I was, of course, able to help her understand what the word Scribe means. But how would you explain to a fifth grader, in simplest terms, what you and your team does? Jennifer:         Yes, we actually design our software, so a fifth grader could use it, it's designed for people across digital literacy. So you could actually tell her to just try it out if she's at all curious, and she should be able to do it.  So, Scribe, very simply, we're a desktop application or a browser extension, your choice. And we will watch you do work and auto-generate step-by-step, written guides with screenshots showing how to do that process.  So let's say, for example, you have a client who is constantly asking you, let's pick something very simple, "How do I log into my QuickBooks Portal?" I don’t know, that's probably a question you've gotten before. So all you would do is you would click the Record button and you would log into the QuickBooks portal, and you would click Start Record. And, boom, Scribe would auto-generate step-by-step written guide on how to log into a QuickBooks Portal. Again, very simple example, but it would say, "Step one, navigate to www.quickbooks.com. Step two, click on the Login icon, instead, it's got a little screenshot and it shows along, and so on and so forth. And there's a bunch of ways, obviously, you can edit, and customize, and all those sorts of things. But the idea is anything you would need to explain to someone how to do. Whether that's a client who's constantly asking you a question, or a colleague that you're onboarding, or a virtual assistant who's doing some tasks for you. It's a very easy way to capture what you know how to do, automatically, and share that with other people. Without having to take any time away to actually write that down or show them what to do.  My whole philosophy is you've already done the hard part. You know how to do something valuable. Let's make it automatic for you to be able to scale that knowledge and to show someone else how to do that.  I'll often talk about it as documentation, as digital exhaust. Just that byproduct, you're going along and doing your work and you're creating this exhaustive documentation, that you can now use in a variety of different contexts. Neha:              Wow, fantastic, and thank you for making it easier for people, who are new to this concept, to understand. You bring up automation, so let's take it up a notch, from the fifth graders' level, and talk about the three-letter buzzword, RPA, Robotic Processing Automation, which is getting a lot of spotlight these days. But then, sadly, it remains just a buzzword for many people in small and medium organizations. How can RPA, or automation like this, help finance and accounting people in these small companies? Jennifer:         Yes, RPA is an area I've spent a lot of time in. I would take it up from RPA to automation. There's a lot of excitement around RPA. RPA, in particular, means I will replicate what a human does using software. So it's almost like a layer on top of your existing systems, and you build these very manual flows that will click through software as if a human were clicking.  I've talked to a lot of Fortune 500 companies that have implemented RPA. They do these big RPA programs. They set up these centers of excellence and they do very good work. I'll tell you, most of them, over beers, will tell me, "I'm not quite satisfied. These things work, but they work 70% of the time." And then you've got these edge cases, something's a little bit different, the software UI changes there. There's a lot of difficulty and nuances when you're talking about RPA. Automation, more broadly, it's just this concept of how do I use software to do tasks that I otherwise would have to be doing? And that I get very excited about, especially, if you're in a small business because time is money.  You have limited resources, limited number of people, we see this with our customers. We're across hundreds of thousands of, of organizations in over a hundred countries, pretty widespread everywhere from a solo person, all the way up to folks in Fortune 50 banks. And we often see it's the small business owners who are the ones who are most passionate about, "How do I save time?" Because it's limited number of resources, time is money. "I could be spending this time servicing a client. Instead, I'm going through and generating reports and doing these kinds of tasks that I could automate." And, so, what I would think about is anytime you are doing something that feels repetitive. That feels like, "Gosh, I do this over and over again or I do some variation over and over again."  Think about, "How can I automate this?" And your mind might, immediately, go to a very complicated automation system. And that is great, if you are at that level of complexity, most people are not. And, so, I would think even at the levels of templates. Here is a really mild automation, are you sending a very similar email every month to clients notifying them of something? Or when you're generating a report and you're sending it out. Depending on your email client, you can create automatic templates. You hit a couple of hotkeys and, boom, it automatically pastes into your email. And then you can change the person's name and personalize customers, whatever you need to do.  But where are the moments like that where it feels like it's simple and it is, but it adds up over time. And, so, I would start thinking about automation from anytime you feel like you're doing something, you say like, "Gosh, this really doesn't feel like a use of my specific talents." Find software to do it, because I bet there is software out there to do that. Whether it's really simple macros, all the way to custom solutions that will help you, automatically, flag uncategorized expenses and send it to a client or something like that. Neha:              Those are some really good examples, Jennifer. And talking about repetitive tasks and tasks that people don't like doing, knowledge management and process documentation always-Jennifer:         What, not everyone's favorite? Neha:              Definitely not everyone's favorite, but these are still very important tasks. Not just from compliance perspective, but they're becoming more and more important because people are now working asynchronously in remote teams.  Jennifer:         Mh-hmm. Neha:              So what have you seen are the most common knowledge management mistakes that people make? Jennifer:         Not doing it, is the short answer. So most people I talk to have some basic knowledge management. We have some wiki, we have made some attempt, we've done something. And then I say, "Well, how's that going for you?" And I have yet to hear, "Great." For most people, they're like, "Oh, it works for this and works for that." And, I mean, there's many challenges with it, but one of the big ones is just the amount of time it takes to create documentation. You have finite, you've got eight hours in a day that you're working or whatever your workday is. And you've probably got 10 hours' worth of work to do in those eight hours.  And, so, you're making ruthless prioritization decisions all day long. And when you say, "Oh, could I send this one more thing to a client, or complete this one more task versus sit here and write out what I know how to do?" Which task are people going to pick? They're going to pick the direct output at all times, it's more urgent for sure. And maybe even, arguably, more important depending on the task. And, so, this is where we thought a lot about with Scribe. We said, "Well, gosh, a big problem is the world's vastly under-documented." I know that's not a sexy and exciting thing to say, but it is true. And it manifests in that it creates a lot of problems for companies. It makes it much harder to onboard new people. It means that your people who are there, even if they've been there for five, 10 years, you yourself are spending time doing these repetitive tasks. And maybe you're not even doing them correctly. McKinsey did a study, of course, I was at McKinsey I have to mention McKinsey. I was not part of the study though.  McKinsey did a study where they estimated that the average knowledge worker, spends one day a week trying to find info on how to do their job or explaining to someone else how to do their job. That's a day a week of just like, "Hey, how do I generate this report?" "Hey, how do I act? How do I file my return?" "Hey, can you show me where do I go to the IRS Support" "Hey, how do I get this in?" And there's these small micro-moments throughout the day, and it feels like not that big of a deal, but you add all of that up and that's a day a week. Neha:              Wow.  Jennifer:         And, so, 20% of your time you're spending doing all of these things. And, so, now in the context of that documentation, what if I said documentation could give you that 20% time back? Say, well, oh, no, that gets exciting to me. And with Scribe, we think about, "Well, how do we make that documentation automatic for you?" So you're not sitting there saying, "Hey, I have to decide, or do I do this task, or create documentation?" And we say, "What if we can make that in-and? What if while you're doing the task, you just hit that Record button and you automatically create documentation?" Now you've found a way to scale what you know how to do.  You've made your knowledge almost like software or media, which are really, scalable elements, versus one-on-one answers. "Oh, I'm writing out an answer to an email." Or someone pings me and says, "Hey, can you give me a quick call and show me how to do this?" I mean, how many of those have we gotten? Neha:              Oh, God, I've sent many of those. Jennifer:         Yes, I definitely have too. We all have been on both sides, and it's not fun being on either side. I'm talking about it from the perspective of the person answering repetitive questions, but being the person asking them isn't really fun either. Because you've already probably gone in and tried to do it yourself and hit a couple of roadblocks. Maybe you said a few swear words to yourself and then you said, "Oh, this is not working." And then you go, "Oh, God, who can answer this question for me? Okay, how do I get in touch with them?" You're going through this whole process. And, so, what if you just had all of that info, automatically, available to those people? So when they were going to do that process, it was just there for them. They didn't even have to spend those cycles going and finding someone else. And, so, if you can find a way to do it, and our software is one way to do this. Where you're just, automatically, creating this process documentation, now you just have way more documented.  So to your question, "What are people doing wrong?" Now you have way more documented, and now you can do a lot more with that. You can avoid questions, in the first place. You can make it so that now when a colleague goes to do something, rather than them saying, "Oh, I don't know, I only do this once a quarter, I forget how to do this." Or "I have never done this before." And instead of them having a mild panic moment trying to figure it out, they can just go find Scribe or the documentation that you've created, and they'll have their answer. And that's, let me tell you, a really delightful experience, when you say like, "Oh, gosh, I had a question and, boom, it was immediately answered. I didn't even have to go through this whole process." Neha:              Wow, and that's definitely a blessing for people who are working in another time zone, where they don't have the luxury of same- Jennifer:         Yes, and that's even worse, because then you've got a question, and now you're gated. Neha:              Mm-hmm.  Jennifer:         People you need aren't available then, and you're probably sitting there trying to figure it out yourself. And you're puddling through and, especially, when we're using complex software. It's not always completely obvious how to do something, especially, if it's a complicated process. And, so, you're sitting there muddling through and trying to figure it out. And those are both real-time costs, and I would argue, emotional costs too.  We assume that's the cost of doing business, of doing work, that you're going to spend time trying to figure things out. But next time you're a little confused, check yourself emotionally. And what you'll see is you're frustrated, you're extending energy just kind of trying and you're like, "Ugh, I just need to get this thing done. I need to move on, I got my 10 other tasks." Neha:              And talking about frustration, I also remember you mentioning something called collaboration overload. Jennifer:         Yes. Neha:              Help us understand what you mean by that and how can listeners in accounting and finance, but also leadership positions can avoid this overload. Jennifer:         Yes, so I think it got a lot worse during the pandemic, and it's really been driven by something that is a good thing, which is the fact that we now have all of this collaboration software. We have all this software that makes it really easy for us to communicate with each other. Whether that's Zoom or Slack, someone is, literally, just a keystroke and hitting enter away, from being able to connect with them.  And I'm the CEO of a software productivity company. And, so, it's counterintuitive that I would say this, but these things almost have been too much. It is too easy now for me to get in touch with people. And, so, what you end up with, and we saw this, in particular, at the height of the pandemic, is you spend so much of your time collaborating with other people.  Whether it's being in meetings, answering Slacks, answering emails, whatever you're using. Different pings, phone calls, text messages, WhatsApp, so many ways for people to get in touch with you and ask you their questions.And, so, what you often end up with is you spend a lot of your day collaborating with other people. And at the end of the day, you can come home and your spouse can say, "Hey, honey, how was your day?" And you can say, "Oh, my gosh, it was so busy." But here's my question or challenge to you, did you actually get work done? Did you actually do the core output of what your job is? Or did you spend a lot of your time in what feels very busy, but just communicating and collaborating with other people? And, so, I like to think a lot about how do you make that collaboration much more productive and have it be much more about the core things that are output related.  And, so, obviously, Scribe is part of that story. Like, "Hey" instead of someone... we're trying to avoid those pings. So instead of someone hopping on a Zoom with you, or give me a phone call to try to show someone how to do something in a one-to-one way, just shoot them a Scribe. The average Scribe takes 56 seconds to create, and two seconds to copy and send to someone.  And, so, find those moments. How many of those can you just bat away with something that's more, to your point, automatic. You feel like minor automations but they actually add up to real amounts of time. There are psychological studies that will say, "For every ping that you get, every interruption in your day." You hear that sound of the Slack message go ding or whatever it is that you're using. "You lose anywhere between five to 20 minutes of actual work." Because of the context switching that's required for your brain to get back into that same deep flow, generative state if you were doing something important and hard.  And, so, these things feel really innocuous at the time. "Oh, Joe is just asking me another question. That's great, I really like Joe, no big deal." But when Joe and Joe's friends ask you 10 times a day, you just lost anywhere between 50 and 200 minutes of time, and time is the thing that we all have as their most limited resource. And, so, can you find ways to reduce those so they don't come in the first place, and when they do manage them more appropriately. So, to your question, for leaders, for example, maybe setting the expectation that when you were doing deep work, you are not available on Slack for a couple of hours. My team, well, when someone's head is down on work, they put a little emoji, we use Slack, whatever it is you use, but we use Slack, and we put a little emoji of someone wearing headphones. It's to indicate like, "I am doing work right now, please don't Slack me unless it's urgent." Neha:              Okay. Jennifer:         And then you come back on and you can batch these things together. Neha:              I like that. And I like how you contrasted collaborating with a self-study kind of format. Where you get the answers without having to ask for them. And also how it connects to setting the expectations and boundaries around your work and your time, which is really precious, of course. So I would like to pivot from here to your own journey. And I was reading through it and you've been quite vocal about how your startup journey went hand-in-hand with your motherhood journey. And we, absolutely, we can spend an entire episode just talking about that. But let's talk about your role as the CEO in Scribe, and what strategies do you use, in your company, to promote inclusion in the workplace? Jennifer:         Yes, we think a lot about talent and our talent value proposition. And any time you're leading teams, you got to think about like, "Why are these people here?" Well, you think about your value props to your customers all the time, you got to do the same thing for your people and your team.  And, so, that starts with thinking about recruiting. Who am I bringing in the door? And, so, we think a lot about... We've sort of had a mantra with Scribe, I tell everyone in our first conversations, when they're debating joining Scribe, "I want, at the end of your time at Scribe, for you to say that this was the most rewarding experience of your career. What would that look like?" Hopefully, it's long time. "At the end of that time, well, what would that look like? What would you say at the end of that time to be, 'Hey, that was the most rewarding experience for me.'" Put another way; "What does success look like for you?" And then I'm trying to map up is that the journey that we're on with Scribe? And do I think we have the opportunity to provide that to someone? And if we don't, then I say, "Great, that's a really great goal that you have for yourself. Let me make introductions to three other people who might be able to help you. Don't come do that here at Scribe, we're not set up for that." So there's a whole kind of, upfront, are we in alignment with our goals and what success looks like? And then when someone's in the door, it's continuing to check in with them because things change. Company changes, people's goals change, and it's still saying like, "Are we still in alignment? Are we still on track? Are we giving you the opportunities that you want? Are you learning how to do things?" And we say we want to find people who are great at their craft and want to become excellent at it at Scribe. And to us, that's creating an environment that is really respectful, that is very transparent, but where people still challenge each other. And, so, we really hire for a growth mindset.  Where people say, "I want to constantly keep getting better and I want to do that here." And, so, what you'll find is that our team is incredibly supportive of each other. We do, at our team, all hands, we'll do shout-outs and gratitude for the last five minutes, and it's just people spreading love. Like, "I want to give a shout-out to Thomas who answered this question for me so quickly, and he did..." And then Thomas, "Oh, but you were really great at that." Everyone is very quick to give thanks to everyone, but they'll also push each other. "Hey, we did really great last month, but let's do even better this month. What would it look like if we doubled that? What would it look like if we shipped this thing even faster?" And, thankfully, this culture becomes self-reinforcing. When you bring in people who want to work in this kind of environment, and then you give them this kind of environment, then that grows over time. And, so, that means you're able to attract people from a variety of different backgrounds. And they're all united in this idea of just wanting to get great at what they're doing and do it in this kind of environment and this kind of culture.  And, again, we design our recruiting process so that it becomes very clear to people, during recruiting, what our culture and our feeling is. So I'll often when I'm having a last conversation with the candidate, right before we're about to make an offer, and I say like, "Do you have any other questions?"  Usually the answer is no, they're like, "I've met people on your team. I have such a great sense for what people are like at Scribe, this feels like my tribe of people. This is really what I want." Or they've self-selected out of the process.  And, so, I think really leading with what is your culture and what does it mean to be here? It gives people a sense and they can self-select in or out, and we don't think about diversity in terms of we have to have a set number of targets or anything like that. We actually don't even really track it other than I looked at it the other day and we are 70, 75% women are underrepresented minorities.   And that's because we've thought a lot about how do we create an environment where people can just show up and do work they feel really proud of. That's our uniting goal together, and that means you get all different kinds of people. But everyone wants to do great work and they're really excited to do it with this other group of people. Neha:              Awesome, and that's a great way to look at diversity and inclusion in any organization. I also love the questions that you're asking and being open to the answers that you get. Not all of them are going to be what you expect, but it's good to hear those things. I hope the leaders who are listening to this are taking notes. Jennifer:         Those are the best questions to ask. Where you don't know the answer and you want to go into it not being tied to a particular outcome. Because really what you're trying to do is find the best answer for both people, and when it works then it really works. When someone says like, "Oh, I really want to do this." And you say like, "We can support you in doing that here." That's magic on both sides. And if someone comes describing and they're like, "I want to become the best computer vision engineer in the world." Then I say, "Great, you should go to Google. They have snapped up almost all of the world's great computer vision engineers, go apprentice with those people. That is the best place for you." That means I lose a potential engineer, sure. But now I've freed up a spot for an engineer who really wants to be here and who wants to do the things that we're working on, and that's a win-win on both sides. Neha:              Right, and talking about young engineers or young people who are entering the workforce. What advice would you give to younger professionals, not just in finance accounting, but overall people who are listening to this podcast. On how they should be navigating their lives and careers as they move forward? Jennifer:         I had a professor in business school who said something I thought pretty profound, at the time, and I didn't think much of it. And now I look back on it and realize just how wise it was. He said, "Find the thing that you are always apologizing for about yourself and find a way to get paid for it." Neha:              Okay. Jennifer:         So, for me, I'm obsessed with efficiency, and I was constantly told, in work environments, that I was too fearless. I would just go off, I'd see a problem and I'd just go off and try to solve it. And they'd be like, "No, that's not how things work here, you're 24 years old." And they're like, "No, back-off, there's a process, follow the hierarchy, et cetera." And I learned over time to do that. And that was fine and good, but now that I reflect back, I feel like I left a lot on the table in trying to conform to those environments. And instead saying, "Well, gosh, I have this passion around the kinds of problems I'm solving and ways of working. What if I could just find a different environment that actually fits those things rather than trying to tell me to change and conform." And sometimes that's right and feedback is good. But if you're hearing it time and time again and you say like, "Oh, gosh, this is a spike I have, and maybe it's a liability in this context, but it could actually be really great in another context." And, so, rather, I think, we often try to smooth out our spikes and become more polished stones. And I actually think the most successful people I know are really freaking, spiky corals. They're really good at some things and not so good at other things, and that's fine. Great, find a way to spend most of your time doing those things that you're really great at and the stuff that you're not good at automate away, delegate away.  Get into a different job where you've got more support around those areas. Whatever it is, just lean into the things that you're good at, and try to spend as much of your time doing those things that you're really good at.  And that's an efficiency story, that's an effectiveness story, and that's, frankly, a happiness story, and I think that's the most important part of it. Chances are if you're good at something, you enjoy doing it Neha:              True, and another thing that I think our listeners can take away from this is being fearless. Whether it's about solving problems when you're not supposed to, or taking that accidental CEO position that lands in your lap. Jennifer:         If someone tells you you're fearless and they mean it as not a compliment, as something to work on, note it in your head and say like, "This is very kind of this person to be giving me this feedback. Feedback is a gift; I'm going to ignore that." Or "I'm going to, maybe, in this environment understand the way to operate, but I'm going to secretly cultivate that about myself because that can be your superpower." < Outro > Announcer:    This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Connect with Douglas: https://www.linkedin.com/in/dr-douglas-clayton-414a785/Learn more about FilmDoc: https://thefilmdoc.com/Heart of Camden Trailer: https://vimeo.com/439742490Dovere of Camden Trailer: https://vimeo.com/327729693 Full Episode Transcript:[00:00:00]       < Intro > Adam:            Welcome to Count Me In, the podcast for accounting and finance pros working in business. I'm Adam Larson, and today we examine leadership from a different angle, with Douglas Clayton, affectionately known as the FilmDoc.  Neha Ratnakar caught up with him to discuss his journey from making crowd-pleasing HR videos for a satellite company, to researching leadership at Wharton for his PhD. To advising C-suite executives through the lens of filmmaking. There's links to the trailers for the award-winning documentaries in the show notes. So be sure to check them out if you're interested. Now sit back and enjoy this great conversation with Douglas Clayton. [00:00:43]       < Music > Neha:              I was going through your profile and it fascinated me, among many other things, by the way, that you had a very long and interesting career in SES satellites. Tell us how was it working with actual rocket scientists and what lessons did your time in SES teach you? Douglas:         That's a great question. There are a couple of really fun elements of working with rocket scientists. One of them is when I go to family dinners, or parties, or functions, and people say, "What do you do?" I get to say that I work with rocket scientists, and that's an instant attention grabber.  But certainly much more substantial than that is just working with folks who are so smart. And most of the engineers and scientists who I've had the pleasure of working with are modest folks. They don't have big egos, they work really hard, they love to figure out problems. They actually love to have problems so they can have something to figure out. So I've always enjoyed it. Always considered it a great privilege to work with people who are so smart and, in many ways, so very kind as well. In terms of, "What was it like to work at SES?" It was a lovely experience, life-changing experience, I'll say, actually. The way I ended up working at SES is I worked for GE Capital for many years. Then I ended up transferring to their satellite business, which was headquartered in Princeton, New Jersey. And three months later, we were sold to a tiny company called SES, in the tiny country of Luxembourg.  Now, you can maybe imagine going from working for this giant company being acquired by a small company. We all had choices to stay, or to maybe move on with our careers, or to stay with SES. And the best decision that I made, career decision, was to stay with SES, and the reason is because, at that point, I was an HR manager, or also known as a generalist. And what we discovered is that as an HR person, and then eventually as a leader, our decisions really mattered when you worked for a small company. Where when we worked for GE we were often in execution mode.  So then to move from a big company where the big decisions were being made in Connecticut. To a small company where they were relying on us in Princeton to help guide the corporate office in Luxembourg, which, again, it was a very small company. It really mattered and it helped to develop our confidence. And then as I evolved in terms of leadership and the company moving up in the organization, that happened more rapidly because of the size of the company than it would have happened with GE.  Working for a company that's headquartered in Europe was a real game changer, as well. Because I needed to put on a different hat and look at work and look at the world through a different lens, not just an American lens, which was fine. But, now, I really needed to understand, "Hey, how do we do leadership?  How do our accountants and finance people, how do they need to work together from Europe, between Europe and the U.S.?  How do our rocket scientists work together?  How do we merge these two cultures? Very different country cultures and company cultures?" So it was quite a learning experience, for me, something that I could have never gained at GE, in the position that I was in, and it's something that I would've never gained just through university. Neha:              That's so fascinating, and I'm glad you made the switch and stayed on. All right, I loved what you said about having problems to solve, actually loving the fact that you have problems to solve. Now, tell me when Covid-19 hit, it must have been very difficult for SES. Because satellite making or maintaining them is not something that you can take back home with your laptop and do it from your dining table. So how did the leaders, and the people teams, in SES make this new reality work? Douglas:         It was extraordinary, what happened. I had a front-row seat because I was part of a task force, the Covid task force, and we would meet weekly, and I was on that team for several months and until I retired. But watching the team, which was led by our human resources leader, Evie Roos, at the time.  It was extraordinary, the decisions that they were making and the stakes were so high. Part of our satellite business is, certainly, working with space engineers, and satellite engineers, and rocket scientists. But we also have, just as important, dynamite teams of people who actually operate. And I'll say quote-unquote, "Fly our satellites." They work 24/7. And, so, what were we going to do with them? So certainly we allowed, I'll say 95% of the organization to work from home, or the vast majority, and that was a whole another challenge and project. But then we have this other group of people where we can't allow them to work from home. We really needed them to come into the office. To sit at the monitors and to take care of that part of our very important, essential, part of our business. And, so, it was really around listening, and listening to what people recommended. Listening to the experts in the field. Listening to the supervisors and the employees, and just making decisions based on what was best for them. So, for instance, the folks who were our satellite operators, who had to come into the office every day, we had meals delivered to them. It was an extremely sterile environment. If there was anyone who was near someone who had Covid, then, that person needed to quarantine. It was very strict because you can imagine potential disaster of having a team of people, who can no longer come into the office to fly satellites because Covid has spread through there. It was executed exceptionally, so that was just one area of our business.  And, then, of course, there's the challenge of allowing the vast majority of our employees to work from home. And, so, how do you do that? What's needed? What's required in terms of laptops, and equipment, and chairs, and everything else that goes along with that. And, then, as a lot of companies discovered we also discovered that it was working quite well.  Our platform for communications is Microsoft teams, and people discovered that they were working, in many cases, actually harder than when they were coming into the office because they were getting up early and they were just burning through the day, nonstop, into the evening.  And, so, in terms of burnout, people feeling stressed, we had to be really careful about that. That people weren't working so incredibly hard that there would be mistakes, and that there would be illnesses and things along those lines. At the end of the day, the employees appreciated the great work done by this cross-functional task force.  Which was led by our human resources leader and, certainly our CEO, Steve Collar, talked about it many times. How incredibly impressed he was with our leadership. But more so with our employees for stepping up and for keeping the business moving forward. Neha:              Wow, thanks for sharing that with me. And that definitely has a potential to be a case study and maybe possibly a film one day. And talking about films I have to ask you this, about the documentary that you made, The Heart of Camden. What inspired you to make a documentary, while working as an HR professional at such a huge company? Douglas:         Well, it began with my first documentary, which is called Dovere of Camden. And Dovere is an Italian word for duty or responsibility, and that was a 26-minute documentary that I made, well, for kicks, I just wanted to see if I could. What's the process, understand the process to make a film, to make a documentary, I should say.  I'd made a few films before that for the corporate world, but which were parodies of mainstream films. And it was more for edutainment, I'll say. Educating people with an entertaining way. But then I wanted to make a film, a documentary, and there was this particular topic of an abandoned bar in one of the country's most impoverished cities, Camden, New Jersey. And there were two fellas who were involved with others, who raised this bar basically from the ashes and turned it into this city's only live theater, great. And we were accepted into film festivals, we won a few awards. Which was quite a shock to me because when you make a film, what happens is you get so close to it that you tend to lose perspective if it's any good or not. But this apparently was appreciated by people. And the feedback we got from folks was that it was quite inspiring.  People said, "It makes me think, 'How can I make a difference in my neighborhood if these two guys did this in Camden, New Jersey?'" So that really made me think, "Okay, maybe, I'll make another documentary." And sure enough, what happened is at the New Jersey Film Festival, where the film played.  There were people in the audience from Camden, from an organization called The Heart of Camden. And about a year later, they reached out and they said, "We watched this film and we were wondering, 'Would you be interested in making another documentary?' This one on a Catholic priest named Father Michael Doyle.  He's getting ready to retire, and his health is not great, and it's an incredible man who's done some amazing things. And, so, we'd like to document his story or the stories that he tells because he's a wonderful storyteller. He was born and raised in Ireland." And, so, of course, I was thrilled and honored to be asked to do it, so I jumped at it. And, so, I said, "Look, there's more to this than just simply documenting Father Doyle's stories. Let's tell his story and let's tell the story of the Heart of Camden organization." And this all came from a wonderful couple named Ann and Mark Baiada and they own BAYADA.  In fact, they're the founders of BAYADA Nursing, in the United States. And they were so inspired by Father Doyle that they're the folks who funded the film, and the idea of creating a film was their idea. So you could say they were the executive producers, if you will, wonderful people.  And, so, we needed a budget and they paid for the film. I agreed to do it pro bono because both films I completed pro bono because it was just my desire to give back a little bit, if I could. But I used the money to hire a professional production organization, a film production company, called ArtC, out of South Jersey, which is founded by a fellow named Bill Horin.  And they were able to really give the film a very clean, professional, lovely look, sound, everything. And then they relied on me maybe to help shape and craft the story behind it. So I was the producer/director of it, if you will.  And, so, we created this film and it's a 44-minute documentary. That documents the journey of a fairly regular man, who did some extraordinary things to help improve a neighborhood, within a very impoverished city, again, Camden, New Jersey. We reached out to Martin Sheen, the famous actor, who narrated another film, that had to do with Father Doyle's poetry, called The Poet of Poverty.  And he called me and he said, "I'm in." Which I was shocked, you can imagine my reaction to that. To hear from him, first of all, the fact that he responded to my letter, and he's such a wonderful guy to work with. He also did it pro bono and that was his contribution to give back. He's a wonderful human being.  So we created this film and we were accepted into 16 film festivals. We won a number of awards, and just as, importantly, as the film festivals is, Ann Baiada had a vision of taking it to universities, which we did, and we would show the movie to faculty and to students.And every single time, probably, a half a dozen colleges, folks, would volunteer to get involved to help The Heart of Camden organization, so the movies really had an impact. We were picked up by a distribution company, and that distribution company told us, recently, that there's a firm who would like to distribute it or, certainly, show it throughout the Middle East, of all places. It'll be translated into Arabic, and it's being picked up by other, I'll say, relatively, smaller companies that are niche-related, not like Netflix or the big ones, but smaller companies.  But the movie is out there and people are watching it, and every time folks watch it, I'm always so pleased with their feedback about how inspired they are by Father Doyle. And his statement to just simply, “Do your bit.” So that's a little bit about the documentary. Neha:              Well, that's such a huge feat and done entirely pro bono. On this podcast, we usually talk about finance-related topics, and I can only thank you for bringing another aspect through your story, today, because that's important too, the social aspect of doing great work. Douglas:         Oh, sure thing. Yes, again, I worked for GE and it was GE Capital and everything was about finance. I mean, everything was about finance. And, so, I learned, at a very young age in the corporate world, that finance is absolutely essential. And there's the accounting function, which is critical.  I mean, if those areas are not working, then companies can come to a screeching halt, and the integrity behind the Chief Financial Officer and the decisions that they have to make. Being a part of the leadership team for SES. Sitting, basically, at the table right next to our various CFOs, I saw, up close and personal, the pressure that they're under to make the right decisions. To tell the right story and accurate story, it's serious business. Neha:              Thanks for acknowledging that, Doug. Now, my listeners will not forgive me if I don't ask you this, because you mentioned making parodies of films for entertainment purposes. Can you tell us more about that? And I remember you telling me about this huge experiment that you did, tell us more, please. Douglas:         Oh, sure thing, yes, we had great fun. It really started when I was in the fourth grade, there was a sixth grade teacher named Mr. Mena, who was a new teacher. And he, instead of doing the annual class play, which was fun but kind of corny. He decided to make a movie and it was a parody on Robinhood, and it featured the children.  And, so, they wrote the story, the kids in the class were playing Robinhood, et cetera, and we just went completely crazy. And I was probably about 10 years old when I watched that, and I never forgot it. So you fast-forward to my time in human resources after we were acquired by SES, and I decided to make a parody on The Godfather, The Godfather of Values. It was the company's pretty boring, stale company values, and we needed to promote them and to educate people. So we did a parody on The Godfather, featuring employees and people loved it. They went crazy over it, and that was, literally, a zero-budget movie. And then we did another parody on Star Trek, Execution. And it was a story of our CEO, as a child, and how he became inspired to really embrace execution as a very important leadership competency featuring Captain Kirk and all of this other stuff. And then we stepped our game up. I was transferred to Luxembourg, in 2007, for a six-month assignment. And folks who saw The Godfather said, "Hey, can you make a movie over here?" I said, "Absolutely." And then they gave us a budget. We had a 20,000-Euro budget, which was crazy. I felt like, "This is, probably, what Steven Spielberg is experiencing." It was major money to us, so we hired a production company, same thing. The employees wrote the story. It featured employees, it featured leaders and for our staff only, it was a James Bond parody. And it was to educate people, employees, on our job competencies that were being introduced to the company.  And as I mentioned earlier, when you make a film, you're not sure if it's any good, you're just so close to it. You think, "Oh, it's probably not very good." They went completely crazy with this movie; I was shocked it was a blast. When we showed it, we had the executive staff, in Luxembourg, hand out popcorn and candy before the movies, and it just exploded, we handed out that. We had gifts for them, a DVD set in a professionally [Inaudible 00:19:20] box, and a little pen, which was an atomic pen that James Bond used in the movie, blah, blah, blah. So, make a long story short, this is the first time that I saw a movie not just simply educate and entertain people, but people told me that that film began to change the culture in the Luxembourg office. It went from a place that was very structured, very hierarchical, to something that became more fun. And that's the first time that I thought, "Wow, the film can perhaps begin to change the culture and influence people at a little bit deeper level." And then we made a couple of more parodies after that. We did one on, and each time from an education standpoint, the film would evolve.  We would experiment with different thing, like the most recent one that we made was a Mission Impossible parody, where Ethan Hunt is trying to find the person who stole the company's knowledge. Because it was about introducing knowledge management to the company. What a boring topic? So we made this parody of a Mission Impossible.  But what we did is there were three pivotal scenes, and we filmed, we wrote in three different outcomes of the scene, and then the audience would get to choose which outcome they think it would be.  So that was our attempt to make it more interactive and to, maybe, immerse the audience in the film and the story a bit more. Which based on my Total Recall experiment, which you mentioned, what we find is that this was a five-month experiment that was conducted, it was really for my dissertation. I went to Penn for my doctoral degree, much later in my career, while I was working for SES. And part of a doctoral degree, as you know, is you have to conduct an experiment and then document it in a dissertation. So my dissertation topic was, The Impact that Film has on Learning. Does it have any impact at all? Maybe you learn less if you show a film, maybe, you learn more, maybe there's no. So I was in a unique position to conduct a five-month experiment, in a Change Management class where we would teach, they were basically six main principles that we wanted people to understand and to learn. And in some classes, we would augment our teaching PowerPoint and lecture with film. In some classes there would be no film. And then we would have a quiz afterwards and take a look at the results. And five months later, when we ran the numbers, what we found is there was empirical evidence, that there was this statistically significant increase in every single instance of using film versus no film.  Even when we controlled for various things such as managers versus no managers. Something called the language effect, which is English is your mother tongue or not. So there were several things that we controlled for. Again, the film had a major impact on learning, on retention, and that's where we came up with the total recall model.  Neha:              Wow, thanks for sharing that, Doug. And I wish all PhDs were this much fun, right? Douglas:         Yes, well, our program director at Penn, a fellow named Doug Lynch, who at the time said, "You can choose pretty much any topic you want, but we have to approve it." So we had lunch and I said, "I want to do either; The impact that humor has on learning or the impact that film has. And he said, "What are you more passionate about?" I said, "Film." And he said, "Film is more concrete. Humor is hard to hold, and see, and all of that, so do it on film." So I really owe it to him for giving me the thumbs up and the encouragement to move forward.  But you're right, I remember a professor said, "If you can pick a topic that's fun and that's interesting to you, the dissertation process will be significantly easier." And that person was right. Neha:              Now you can tell it to the rest of the world, I guess. And I hope leaders are taking notes on how they can add some spice to drab topics like company values, ethics, knowledge management, et cetera, in their own companies. Douglas:         You know, it's interesting, I've had the good opportunity to speak on this topic in New York, and Princeton, Atlanta, California. Every time I do talk about Total Recall, and I show clips, it's interactive, it's really fun. People afterwards will ask me, "Hey, can I see a copy of your film? I'd like to do something like this." Or what have you. So it really does get the attention when we talk about it, it does get the attention of various learning leaders.  Neha:              Thanks for giving such great ideas and inspiration from there. Now, you've also extensively worked with executive development and developing potential leaders. Can you give our listeners, who are team leaders, some tips on how they can support and develop leaders in their own organizations? Douglas:         Certainly, at SES for instance, and what I'm doing now as part of my consulting is leadership development. And that was always my favorite thing, at SES, was employee development and certainly leadership development. It was great fun, there were great opportunities, and one of the things that works quite well is mentoring. So if leaders just simply take the time to listen, and to mentor. What we tell leaders is communication is key.  And as Father Doyle said in the film, "It's the key to everything." It's the key to families, it's the key to companies, et cetera. But communication is key, and we talk about bi-directional communication is something that I learned from a fellow named Mark Steinberg. And the listening part we say is more important than the speaking part.  So mentor, listen to folks, have a conversation, have a cup of coffee with them. Tap into what's important to them. What do they want? And then help them on their journey, give them tips, put them in touch with things that may have helped you, may have inspired you. Whether it's a book by a popular author, what have you, but it is basically tapping into what's important for them, and then helping them get there. Showing them that you care, and, really, listening is very important.  Storytelling is important. As a leader, if you can develop your storytelling skills, it goes a long way with getting the attention of folks. Now, what we tell leaders also is one of the unsung heroes, I'll say, of leadership competencies, is influencing skills. So the more you can influence people the better. And one way to develop your influencing skills is by developing your storytelling skills, if you can lay a story out. The reason why something has to be done or should be done, and how to get it done, it's very helpful to folks. Neha:              So true, bringing it back to the basics; listening, mentoring, and storytelling. Douglas:         Mm-hmm, exactly. Neha:              I love how you connected it to mentoring because the traditional model of mentor/mentee is now a little outdated. It's more about co-mentoring, where both parties are learning from each other and helping each other grow. Douglas:         The first time that I ever heard about that, it was when I was at GE, and Jack Welsh, and when IT and computers were coming in, and internet. And these brilliant corporate leaders, they were really far along in their careers, and they just had no idea.  So they would do what they called reverse mentoring. Where they would have younger people in the organization come and teach them about how to turn a computer on, I'm being kind of funny, I guess. But, basically, to learn the basics and then the next step up. And they felt the best way that they could learn that is from younger folks. So there was this reverse mentoring taking place.  But what we find from our executives, we have an executive mentoring program in place, at SES, and it's part of what I do with my consulting now as well. And what we hear, consistently, is the executives say, "It's not just them learning from me, I'm learning from them as well." Which is not a surprise to me at all because I've learned from people a lot more during my career, who worked for me and who I worked with than what they've learned from me.  But it's pretty cool to see it as an eye-opener for executives that, "Oh, I thought they would be learning just from me, but I'm learning from them as well." Neha:              That's so true, and I learn from my daughter every day. So there's no [Inaudible 00:28:45] of knowledge if you let yourself stay open and just listen, like you said. Douglas:         What's that saying, parents? We teach our children about life and our children teach us what life is about." Neha:              Ah, that's so beautiful, thank you for sharing that. All right, pivoting back to what you said a little while ago about James Bond, and how you used that as an inspiration for making movies. I heard you go by FilmDoc, yourself, a code name. Tell us more about what you do as a FilmDoc. Douglas:         Thanks, yes, it's a play on words. I'm passionate about film and when I was going to Penn, it became clear to me, and some of my classmates and a couple of professors said, "You're so passionate about film and learning, you should do more with this." And, so, film, I'm passionate about it. Doc is a play on words for my doctoral degree and for documentaries, so FilmDoc. And, so, thank you, I'm glad that you're cool with the name. What I do is leadership development, and the focus is on developing leaders at all levels, including individual contributors. Because, after all, we as individual contributors have a leadership role to play also.  The curriculum that we've designed and we've rolled it out in Europe, it consists of a full day of, in the morning we look at the film, The Heart of Camden, the story of Father Michael Doyle. And we ask people, "What are your leadership challenges?"  And then we look at the film, it's a 44-minute film. We look at it in two parts to dissect it, to look at examples of leadership that they see, or maybe there's a lack of leadership, what have you. And, then it's always internalizing and always putting it back on to the audience, on to the participants.  And then in the afternoon, we talk a little bit about the leadership that's required to actually make a movie, to make a film. What did I experience making the film and what competencies were important? What mistakes did I make and what would I have done differently? Et cetera. And the reason is because what we have found is that when we talk about leadership and leadership competencies in the frame, or through the lens of art, whether it's Shakespeare or what have you, it seems to connect with people at a deeper level.  We've done this before, and I've seen it done with Olivier Mythodrama and some other organizations and it's very effective. And, so, to talk about leadership through the lens of filmmaking, it is exciting to the audience. I wasn't sure how this would go over, but the feedback has been very positive. I've been invited back a few times, I'm very blessed to do it, so it must be working.  And then what we do is, we then talk about who is your inspiring leader? Who's inspired you? And we talk about what it takes to actually make a film. So not just leadership, but here's how you make a film, it's about an hour worth of discussion. And then we break them into groups of three.  We tell them to go away, and then to come back in an hour, and then pitch their idea of their film, and that we pretend that we're a venture capitalist and we want to invest in the next brief film, and then they do that. And then we tell them, "Okay, now, indeed, you will make a film. You'll have a month, in groups of three, to make a film, a micro short."  A micro short is a film that could last anywhere from two to five minutes, so it's not a daunting task. And they'll use their mobile devices, very basic free editing such as iMovie or something like that. And, then, they'll make their film, and then they'll get to show it to their organization at a leadership film festival, and there's going to be a director Q&A et cetera, so they're quite excited about it. The other option is there are some firms, who may not want to do an afternoon of filmmaking. So, instead, what we offer is an afternoon of storytelling for leaders, or writing, creating your leadership manifesto. What kind of a leader do I want to be? How do I want people to see me and how will I get there?  And then the other offering, separate from that curriculum, is a high-potential program, which should be broken into three categories. The first module is Leading Self, about self-awareness. We need to be clear who we are, as leaders, before we can lead others.  The next one is Leading Others, and the third one is more strategic in nature, Leading the Organization. And those three, there's mentoring involved with it. There is a dynamite skills assessment, leadership skills assessment, in the very beginning. Which includes a 360 and then also includes a personality assessment, and the feedback about that has been fantastic. That's something that I learned and that I helped to co-develop at SES as well. Neha:              And that doesn't surprise me at all. It's definitely an innovative way to start a dialogue around leadership and, of course, learning from an award-winning director like you. All right, so, now, we have time for just one final question. I really enjoyed chatting with you today and I wish we could keep on talking. But one last thought I wanted to hear from you, was if you could give a mantra of success to people. Who dream of a global career, an exciting career like yours, what would be a mantra for success? Douglas:         Find out, it's really simple, it's nothing terribly original. But someone told me, a really wise leader, who I had many years ago and I'm friends with today, Paul Fairley said, "If you do what you love doing, you'll be successful, success will follow." And that's what I've tried to follow, just simply, "What do I love doing?" I started out working in mortgage banking, in approving loans for Fannie Mae and then for GE Capital and in risk management, I didn't love it. What I loved was working with people. So I was able to move into human resources and never looked back. And then from there, education was important to me. So I went to Villanova and then to Penn, I had these great opportunities, the company was super supportive. So I pursued education because I loved education.  And then film, the more I discovered that film was very important to me, not just from entertainment, but for other reasons, more for inspiring then I pursued that. So it's, basically, just whatever you love doing, pursue that. I always tell folks, "Don't focus on making a lot of money." Again, if you're successful, if you'll do what you love doing and you're successful, then the financial rewards will most likely follow. Neha:              Wow, I wish you continue to do what you love and what you're really good at, Doug. It was such a pleasure to talk to you today. [00:36:13]       < Outro > Announcer:    This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Connect with Ane: https://www.linkedin.com/in/aneohm/ LeaseCrunch Website: www.leasecrunch.comWhat is ASC 824? The ultimate guide: https://www.leasecrunch.com/blog/asc-8425 FAQs about embedded leases: https://www.leasecrunch.com/blog/embedded-leasesRequest a demo: www.leasecrunch.com/request-a-demoFull Episode Transcript:[00:00:00] < Intro > Adam:            Welcome back to Count Me In. The podcast for accounting and finance professionals working in business. I'm Adam Larson. Today we'll be discussing a perennial hot topic lease accounting, specifically, FASB's new standards for private companies and nonprofits under ASC 842. And just in case you're unaware, the deadline to transition to the new standards is December 31st, 2022. Thankfully, I'm joined, today, by a true expert in this, infamously, thorny topic. Ane Ohm, is a CPA as well as co-founder and CEO of LeaseCrunch, a software company that helps companies simplify their lease accounting. If you're looking for practical tips and best practices to make lease accounting a little less stressful, this is the conversation for you. Let's get started.  [00:00:51]       < Music > Well, Ane, I want to thank you so much for coming on the podcast, today. We are going to be talking about lease accounting. And as all of us know that the standard, the new Lease Accounting Standard deadline is approaching very quickly, and people should get started. We've been talking about this since what? 2018. And if you haven't gotten started the time now is to get started. What do you think? What is your advice to people as we start talking about this? Ane:                I think the big thing with any accounting standard is that, and when I was running a different company. A new accounting standard would come up and I would ask my accountant, "What is the last moment I have to do anything about this?" And that's when I would do it. And the challenge with the lease accounting standard, if you wait there's a couple of things, first of all, leases can be complicated.  And, so, that analysis of your lease, spending the time understanding it in the context of the new lease standard can take some time. And, secondly, if you need help and you wait the experts are going to be busy. So you're going to have a really difficult time getting a hold of someone who can really guide you through the right steps.  So we're actually hearing CPA firms state that if their clients wait, they're going to have to charge them more in order to be able to offer that assistance. Because they're going to be so busy with other things. If you wait until January, February, this is going to be rough. So start now, get on top of it, it's just going to make things, life, better for you. Adam:            Yes, for sure, because you don't want to wait till the last possible second because it's going to fall back in your face. Do you think that maybe we could start, in this podcast, to maybe go over some practical expectations and how to make your adoption easier? Especially if you are just getting started now, or even if you've been aware, you've been preparing. But to the actual practical application, it's still going to be a difficult process. Ane:                Yes, so there's something to it when you think about the new Lease Standard, you have basically two types of leases. Leases that existed before the standards needed to be implemented, and then leases that start after the standard need to be implemented. So talking about those leases that started before your initial application date of the new standard. The FASB, Financial Accounting Standard Board really wanted to make sure that this was as easy as possible. It sounds like that might not be true, but it is, they have said that repeatedly.  And, so, what they've done is they've actually provided some practical expedience and those practical expedience, the whole purpose of them is to simplify the new standard. So for those transition leases, those leases that existed before, if you have a nice software available to you, there's really only six pieces of information that you need to do.  If you apply those practical expedience, make sure you're doing the things that make this as easy as possible. And then collect those six basic pieces of information. And those are; start date, well, guess what, that start date is going to be the initial application date of the standard.  So if you know that already, huh! If your end is December 31st, that's going to be January 1st, of 2022. All right, so we got one. Second one is, "When does the lease end?" It can be a little more complicated because you have to not just say, "When do I stop paying? When is the initial end of the lease?" I have to, also, look at it and see, "What might I be reasonably certain to renew a term or might I be reasonably certain to terminate early?" So you really have to look at what is the total lease term, including renewals, if you're reasonably certain. It's a high bar but you do have to look at it. The third thing is discount rate. So, and I don't think we know this but those first two seem, they are pretty easy. And the discount rate is the FASB offers the ability to just use the risk-free rate. So that's great because that's publicly available.  You don't have to really think about it too hard. Or the challenge with the risk-free rate is that it will tend to be lower, which means your lease liability will be higher. If you don't want that for larger leases, the FASB, also, more recently, allows us to decide your discount rate based on asset class.  So you can say, "All right, for my office lease, which is a big lease, it's going to be big dollars, I'll spend the time to figure out the higher discount rate. And if I have vehicles or photocopiers, I'm just going to use the risk-free rate." So that's a nice thing, so that's the third piece of information. Fourth one, is, hey, is this an operating lease or a finance lease? Well, once again, FASB says, "You know what, if you had an operating lease before it's an operating lease now. If you had a capital lease before it's a finance lease now." So you can elect that practical expedient to just move forward, so that's the fourth one. Boom, you know, that one. Fifth thing is, what are any existing balances on your balance sheet as of that first date?  All right, if you had an operating lease and you had some deferred rent and deferred rent balance, you want to make sure to include that balance. Because you've got to be able to get that off the books. And then finally, what are your remaining lease payments? So those six pieces of information, while that it takes a little bit of analysis, they're not too complicated. So when I say get started now, I also mean that getting started now it's not overwhelming, it's not hundreds of bits of information. And I think that's a big thing that people do, is they assume it's going to be so hard, it's just better to push it off. Adam:            Yes, you get overwhelmed by whatever the task is and you never actually start it, and then it becomes even more overwhelming because you're behind. And that's practical application of just business in general, trying not to procrastinate, right? Ane:                Which I have to say, I mean, I live that every day, "When do I have to do this?" It's just for this particular one, there's another reason why getting on top of this can be really important. And that is many private companies, the reason they follow GAAP accounting is because they have a bank loan. And if they have a bank loan, adding lease liabilities could cause them to be in violation of some of their debt covenants.  Now, those debt covenants are changeable, but you have to get on top of it. So what we hear from banks, is banks are waiting for you to come to me and tell me, if you think you're going to be in violation. Well, in order to know that and know what those numbers are, again, getting started early makes a ton of sense.  You can have conversations with your banks. Make sure to make adjustments so that you hit your December 31st financials. You don't end up with a debt covenant violation that you really didn't need to have.  So that is another really important reason to get on top of this early, and pay attention to those practical expedience that the FASB offers to make it easier. I'm also somebody who loves to make things harder. Like, "I'm going to do it the real way, I don't need the shortcut." No, come on, in this particular case it really makes a ton of sense to pay attention to those opportunities. Adam:            It does make a ton of sense and something that you spend a little bit of time on. And I think we might need to delve into a little bit more, are those discount rates made available by FASB. I feel like that's something that you're really going to have to adjust your formulas. Or if you're using a software, you're going to have to really adjust and really re-look at everything to make sure that you're following that properly. Ane:                Yes, there's a couple of things around discount rates that are really important to just know upfront. One is, again, going back to those transition leases, the FASB allows you to either determine, so because a discount rate matters, the term, the length of the term. So if you are borrowing $100 and you borrow it for a day versus 10 years, you're going to pay a different rate. The longer it is you pay more. So what you want to do is look at, you can decide do you want to use a discount rate for the remaining term, or do you want to use a risk discount rate for the original term of the lease? And you have to make that election for every lease. So you can't pick and choose, that is something you have to make for every lease. So that's just something to keep in mind, looking at the rates that are available to you. Do you want to go back to the term? So if it's a 10-year lease, but they only have a year left, do you use a one-year term or do you use a 10-year term?" So that's one thing. Second one is look at, consider materiality, and what's going to be the easiest approach to this? So what does that mean, for your more material leases, spend the time to figure out a discount rate that would be specific to. So the lease standard says you're supposed to use the rate implicit in the lease, if it's readily discernible. That is almost never readily discernible.  So it's nice that they say it but it's just, kind of, a pipe dream. You just don't generally have all of the information that you need, in order to know the rate implicit in the lease from a lessee standpoint.  So then you have to go look at it and say, "Okay, well, my discount rate needs to be, then, the collateralized borrowing rate that I would need, if I was to borrow money to buy this asset for this amount of time. What is that rate? Just inherently you can feel like, "Oh, my gosh, how the heck do I do that?" So it's going to take a little bit of time to figure out your discount rate, if you have to actually calculate it. So you only want to do that for the assets that matter. You only want to do that for where it's material. So that might be your office lease, if you're adding a million dollars onto the books, you probably want to make sure that you make that as low as possible. Adam:            Sure.  Ane:                So using a higher discount rate is going to be a benefit. Whereas for those smaller leases, just take advantage of that practical expedient. Use the risk-free rate, the published rate out there, boom. Look it up, boom, you're done, it's going to be much easier to do. And, again, for those transition leases, as you are making the transition to the new standard, that rate would be the rate as of, if December is year-end, it's going to be the rate as of January 1st, 2022, so that's when you will identify that rate. Adam:            I just need to verify something; you keep saying 2022, do you mean 2023 or is it the rate of January, 2022? Ane:                This standard needs to be, so if you have a December 31st year end, you need to be implementing this standard for your December 31st, 2022 financials. Adam:            Oh, okay. Ane:                So if you haven't started now, that means you are going back to January and you're figuring everything out back to January. The reason why so few people have started is because the standard says you don't have to implement the standard for quarterly, for interim financials, in 2022. You only have to do it for year-end. On a go-forward basis, you'll have to do it for all of your financials, any financial that you publish. So we accountants are saying, "Yay, I don't have to do anything yet, because it's not until year end."Adam:            Yes. Ane:                Now, but the fact of the matter is you do have to go back to January 1st, and that is actually another practical expedient that is offered by the FASB. Which is, let's say you have comparative financial statements, you have two years that you publish every year. You do not have to restate prior years, so that's a good thing.  So if you have '21 and '22 on your financial statements, you can just implement this - as of 2022. I think, I know of one situation, where someone went back and restated prior years. Almost everyone is like, "Whew, I'm not doing that. I don't care if they're not very comparative for one year, I'm not restating 2021 if I don't have to." Adam:            For sure. All right, so there's another type of lease that I've heard about that I know that this, particular, implementation affects is called the Related-party Leases. Can we maybe talk about those a little bit, especially since it affects the smaller organizations? Ane:                Absolutely, it's actually incredibly common for an organization. Let's say you have a factory, and they're some sort of manufacturer. It is a common practice to have the building that the manufacturing company operates out of, to be owned by a slightly different set of owners.  So it could be a parent sold the business to a child and retains ownership of the building. Or it could be, I've seen opportunities where the executive leadership has an opportunity to buy out the building and this is just another income opportunity for them, another way to… that's from a compensation standpoint.  So anything like that where there are transactions between two separate entities, but there's a strong relationship between them, you have to disclose that. So that's what's important about related parties. The second thing from a lease standpoint, that's important about related parties, is that it may not be very well documented. So what do we pay it for? How long? How long are we going to be in this building? There may not be a lease. There may be a lease that goes on for a really long time. So there are so many different things that can happen with related party leases. And, so, people are asking a lot of questions, they're really nervous about their Related-party Leases.  So the thing that's really important about this is that related party leases, for the new lease standard, you do not have to try to conjecture what might happen. You actually go to the legally enforceable provisions. If there is no lease, you might not have something legally, but what would be legally enforceable? So what does that mean? If you have a written lease, you just look at those terms and you apply the new lease standard according to those terms. You don't have to think, "Well, we're never going to move, so this should go on for 50 years." And now you have this massive lease liability that really isn't the intent of the new lease standard, not at all, that is not the intent.  So the fact of the matter is, for related party leases, you look at it and you say, "What is legally enforceable?" And that can change, people could decide to change their leases to ensure that they're not, and really the big thing is not overstating the lease liability, that's what we all care about. We don't want this huge liability that skews our books. And, so, the important piece of that is to remember who is the user of your financial statements.  So, if it is, again, to go back to if it's the bank is the primary user of your financial statements, and they understand that related party relationship, and they understand how that's getting reflected onto the financial statements, that's what's most important. It's not just about complying with GAAP, it's that the users of the financial statements have a clear and transparent understanding of your business. Adam:            Mm-hmm. So I know that when this was first enacted or talked about in 2018, it affected all of the public companies. So now it's affecting everybody, if you follow GAAP you have to do this. Now, let's say you're a small company, small organization, and you may only have one lease. You're like, "Oh, I don't need to do that, I just have one." That would be incorrect for you to think that way, correct? Ane:                Yes, so in 2022 if you have to follow GAAP and you have even a single lease, this applies to you. And the thing that's important to remember about that single lease is it's oftentimes your office space. So it's a material lease, not just a couple of hundred dollars, but it's usually thousands and thousands of dollars, and would be material to your financial statements.  So it really is important to make sure that you're paying attention to this. I remember one of the very early days I was doing a training. I was talking about all of this, going through a whole training about everything relating to this standard. And the first question was a guy in the back, he's like, "So, wait a second, does this apply to all of my leases? What about my vehicles? Well, what about my equipment?" He just was sure that maybe it was just real estate. I'm like, "No, it is all leases. If it's a physical asset, it's all leases." So it has been, and we saw this for public companies, where maybe they just didn't pay as much attention to operating leases because they just expensed it. So it didn't really matter if they identified them when they started looking through all of the arrangements that they had.  For example, hospitals, hospitals will use consumables. So let's say it's a thermometer, and the thermometer has a little plastic tip on that, this is back when they actually had to touch you, put it in your ear or on your forehead, so that that little plastic tip was a consumable. You need to dispose of it every single time. So companies would actually say, "Hey, if you buy all of those consumables from us, we'll throw the thermometer itself in and you don't have to pay extra for it. If you buy this much in consumables." Well, guess what, that thermometer actually becomes a lease. Adam:            Wow. Ane:                Yes, because it's a physical asset and you're using it for a period of time and you are compensating a company for it. So you got to pay attention to the physical assets that your organization is using. Very importantly, it doesn't have to be called a lease in order for it to be considered a lease under this new lease standard. Adam:            So you really got to read the fine print and the rules, and see exactly what it is. Ane:                Yes, so one of the things that, from a resources standpoint, to, for example, uncover situations like I just described. We actually have what we call an embedded lease identifier for free on our website. You go to our Resources page and the purpose of it is to help an organization understand is this contract, is this arrangement, is this agreement, is it possibly a lease?  Is there possibly a lease in here?  And you go through five questions and they're not easy. But it's just five questions, one at a time, with examples of yes versus no. And at the end you actually can have a report emailed to you that says, "Yes, this is a lease." Or "No, this is not a lease." And for an organization, this can be a helpful audit tool to show their auditors, "Hey, we went through all of our arrangements." All these different reasons why, maybe I have a regular payment to a company and I just want to make sure that is this, or is this not actually a lease? I've gone and I've done the consideration, and I know it's not a lease and it's okay that I don't apply the new lease standard to this. So the good news is there are resources out there, look at our website, leasecrunch.com, we have a lot of free tools, and guides, and educational materials to help people understand this standard. It's hard enough, leases are complicated. We don't need to make it harder than it has to be, so, we really want to try to ease that burden for everyone. Adam:            Well, awesome. Well, and I'll make sure to have those links in our show notes. So my audience, please make sure you click those links. And, Ane, thank you so much for coming on and trying to break this complicated subject down for us today. I think we all have probably have a better understanding. Ane:                My pleasure. Thank you very much for having me. [00:23:00]       < Outro > Announcer:    This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.    

Contact Michael Teape: https://www.linkedin.com/in/teapetraining/Teape Training International (TTI): https://www.teapetraininginternational.comGet my FREE eGuide 7 Best Facilitation Tips to Ensure Engagement & Learning to ensure your Online Training Success: https://tti-signup.ck.page/eguideFull Episode Transcript:[00:00:00]       < Intro > Adam:            Welcome back to Count Me In. I'm Adam Larson from IMA, or the Institute of Management Accountants. For those of us joining us for the first time. I'm excited to welcome back Michael Teape to the podcast. Michael is a seasoned management coach and the co-founder and president of Teape Training International. Today, we discuss the tips for leaders in the face of constant disruption to business as usual. With Covid, inflation, supply chain issues, technology changes, leaders need to stop bracing for the next curve ball, and instead look for ways they can adapt to find new paths to success.  It was great to get Michael's insight and optimism on this important topic. Let's get the conversation started.  [00:00:45]       < Music > Michael, thank you so much for coming back to Count Me In. We've talked about being more productive at work and maximizing our human capital management, in the past with you. But today we're going to focus in on the disrupted leader. And I figured we can start off by what do we mean by the disrupted leader, and how are leaders being disrupted? Michael:         I think it's easier to say, "How are they not being disrupted? " Adam:            Yes.  Michael:         Because, I think, when you're a leader in your organization and everyone thinks about what's going on? What are the challenges right now? There's some common themes that are only getting quicker, faster, more challenging. So you can think of climate change. Climate change has a huge impact on how we work? Where we work? All of those, and safety elements of that as well.  Social change; the diversity of the people we work with now, that's been being disrupted. We're not all in the office in one place, that's another part of social change as well. Covid-19, I mean, hello? Last three years, it's been a real challenge. And that's one of the biggest ones because it was an unknown challenge.  The others climate, social, and the last one, technology. The technology revolution, what they call the fourth industrial revolution, are the four key areas I see right now, and there'll be more. There'll be more things that come along, let alone the small challenges of running a business. Issues with clients, lack of clients, too many clients, things not going well with clients, disruption on so many levels.  So now we've cheered your audience up. And, so, it is not an easy place. It's more about how we react to it, and technology is one of the biggest ones. That fourth industrial revolution talking about the technology revolution. It's that people are coming up with intuitive ways of breaking our systems and doing things differently. If you have an organization that's run on mainframe systems, spreadsheets, there are so much things available to skip all of that.Fintech, the financial technologies that really don't have any of those and are just very simply making connections, using the technology in front of them quicker, faster, cheaper, that's a huge part that's going on as well. So, yes, where are they not being disrupted, Adam? Adam:            Exactly, I think, you hit it on the nose, there's so much disruption happening all over. But when you're thinking about, as a leader yourself, if I'm thinking about my team and how I act with my team. Yes, there's so many outside disruptions. What does it look like, for me, if I want to look upon myself and how am I being disrupted? And what does a disrupted one look like? Because you don't want to stay there, obviously. Michael:         No, it's a stressful place to be, being disrupted, you're playing defense. You're frustrated that things aren't working, which causes stress. Which also limits our vision and our focus. A lot of being creative and getting ourselves out of these issues, by thinking of new things that we could do to face a challenge and move forward.  So, yes, that looks like, and I'll say this, Adam, a lot of the time we don't realize we're in this space. Call it the disruptive leader, we don't know that we're acting in a certain way because we're under stress. We've got our blinkers on, like, "My business is not making money. How are we going to make some money?" And being stressful, following up on one particular client who's never going to give you the money is a blinkered approach. You need to be looking at, "Well, what could I do to create another million dollars?" Depending on the size of your organization; 50, 100, million. "What could I be doing?" So they're disrupted, they're blind to the problem, really. And what I mean by that is that they're focused on the minute, the tactical, trying to get the number of accounts, trying to charge more per client. When really the problem is maybe what I'm offering the client is not what they're looking for. Have you ever thought about that? And that would be a curious mindset.  So being blind to the problem is all about losing your focus overall and focusing on the minutiae and doing… Have you ever heard that adage, "If you're ever doing the same thing and expecting a different result, that's a definition of insanity." I love that term, that phrase. So that's where someone would be stuck, that would be one of them.  And that links into the other one is having no direction, no purpose, and what I mean is that; where are we going? Where do I want to go? And I think I shared on our last podcast, a little bit, I'll have to go back and have a little look at it, maybe your listeners would do as well. Is that I was working with a client who was totally disrupted by Covid.  They were a Fintech. They were 30% growth they were aiming at and it just disappeared overnight. Because people didn't need to manage cash flow because they weren't out spending cash. And, so, the flow was very different and it wasn't where their market was. But instead of panicking this person found the purpose. Well, her purpose was to take over the world and help the cash management globally, however, that's not possible right now.  So I believe it's coming back but let's focus on rebuilding what we have. The mergers, the acquisitions, being more efficient. Let's focus on fixing what we have, and we have a dream time right now. Let's not think of it as, "Oh, my goodness, we're not going to grow this year." We've already made revenue, so let's take the panic off the table.  But wouldn't it be great if we had the time to fix all the efficiencies and the mergers, now? Well, guess what, they have and they got excited about that and moved forward. So that's someone who's found purpose in the disruption that's happening around them. What they could have done, not having purpose, is knuckle down, and, "Well, we need to get more accounts. Go sell, go meet everyone in the industry, sell." But you're not going to sell something that people don't need right now. So you're banging your head on a brick wall. So I'm talking about banging your head on a brick wall, not thinking about what you're trying to achieve, overall adjusting. And that leads me onto the third one, which is, do you have a psychologically safe environment or not?  If you're under stress, Adam, employees, that work for you, are going to feel the stress in the way you talk to them, not making it safe, shouting. Blaming people, "Well, why didn't you make the sales? I asked you to go and get some more sales." And that leads me, really, nicely into the next session of not allowing people to express their ideas, and thoughts, and fail, and not a safe environment. If we are too busy pushing our employees to go out and sell something that isn't possible, or make something better in the disrupted environment. We don't have the clients right now; they don't want what we offer.  There's no use shouting or blaming them, and that is really when a leader is under stress, that's where they're coming from. They're blaming others. When really you should be like, "Well, where does the blame actually really sit?" Is it with the person you told to do an impossible objective and they're not bringing back a result? Or is it with the person who sent them on this mission? On a mission that they're never going to achieve? So let's think of it in that way.  But what we do is we lash out, we complain. We get frustrated at people that don't bring us results. But they can't bring us results if they're not focused on what's going to work. So that's a huge piece; is you're not going to get people thinking differently, helping us get us out of a challenge, by shouting at them.  You need to create what's called a psychologically-safe environment. And then the last thing a disrupted leader would be is, "I need to build something new." Or, "I need to rebuild this product, and I'll spend a lot of time working on that and releasing something perfect." But the problem with that is that by the time they've done that, the world's moved on. So I feel as though they can't really balance execution with innovation. It's like, "Well, we've had some great ideas, but I just can't get it executed." And that's a fact.  So blind to the problem, it's as denial really. Not focusing on the purpose and direction, focusing on the day-to-day. How you talk to employees. So that psychological-safe environment, being blunt, and blaming others is not going to help.  And, lastly, is spending too long executing something and releasing, what you think the environment wants. When really you need to be checking in a lot quicker on that. So they're really the four areas where leaders get disrupted. And I'm sure your listeners can feel the pressure in one or a multitude of those. Adam:            Yes, I'm sure many can relate, especially, with what everybody's gone through in the last three years, with Covid. But the other examples you gave have been going on for longer than that. I wanted to shift the conversation to the other side of it. We've talked about disrupted, and there's something else that you and I were discussing is the disruptor or the disruptor leader. Can we talk about what that means, as an opposite, I guess? Michael:         Sure, yes, so if you are disrupted, that usually means you're in a psychologically unsafe place, you're in an away state. You're blaming others, you're frustrated, you're worried about loss, losing something, and you're on the defensive.  None of this is going to be useful when you're facing a challenge or your business is facing a challenge or challenges, in helping you getting unstuck and moving forward. And then the opposite of disruptive is to be a disruptor. And that's someone who's more forward-thinking, curious. Like, "Oh, this is interesting, this is different. This feels totally different; we've never had this before. What's causing this?" Or, "What are our clients really looking for? What support do they want from us and our team?" And that's an open way of looking at the environment, it's a growth mindset, really, not a fixed mindset. Looking at the environment, being open, humble, hungry to learn what's really going on. Going and talking to people, listening to what people have to say in podcasts, and reading the latest of where the industry might be going based on what's happening right now. So that opens it up, that allows you to see the landscape in order to find your place in it. So that would be the first thing, rather than being blind to the problem.  And then I talked about purpose. So people say, "Yes, I know my purpose." But do they? They know that their purpose is to get the reports in for a client, management accounting, there are certain tactical things. But what's my purpose overall? Is my purpose to stay in business? That's more reactionary and proactive.  So I encourage leaders, if you want to get unstuck is ask, "Well, what do I want to do for my clients?" "What do I want to do for my profession?" And it helps open us up a little bit.  "Yes, I want to achieve that. How else could I achieve that?"There's a client that I work for in the insurance industry. Very specific and very good at what they do, and a very specific market. But they're reaching saturation point, so really that's a challenge. It's none of the industrial challenges I talked about, although, it will be when they have to update the systems.  But they are looking at different ways of helping their clients, and they're offering training for their specific housing associations that they support. Training on how to be effective, how to mitigate their losses, how to less the insurance claims. So they've gone into this whole different submarket that there's a need. Thousands of their clients are signing up to listen to training courses on a subscription basis for them. I mean, it's genius but it came from wanting to serve your clients, helping them. "What challenges do my clients face?" It didn't come from, "I need to sell more insurance policies." So that's a big area.  And the last two is if you want people to be creative, it's got to be okay for people to come up with ideas that don't work. It's they've got to be... but that, then, leads me to the last one is let's be quick to fail. "Let's try something real quick. Let's keep it in a two-week turnaround." Two weeks, "Is this going to work or not? We've got two weeks, let's play with it. Let's work with it. Can we test it? Can we release it?" So it's a bit like project management that has moved to the agile mindset, which a lot of your listeners will know about. And that's all about scrums and, very quickly, what can we produce in two weeks? Boom. We're just going to sprint, get that out there, and then adjust.  There's no point in my world, my learning world, there's no point in me spending six months to release a leadership and development program. Because I'll be out of date by who knows what's going to happen. And it'll need to be adjusted as soon as I've released, it'll be old news. So think of that and what we are doing for our clients is, are we hitting what they really need?  Are we curious enough to know what they really need and are we releasing things quickly? So that helps people to experiment, it makes them feel safe. "We'll, give it a go."  And, "Yes, we want it to be successful, but we're not going to be upset if it doesn't. We're going to learn from it and quickly adjust to find something that does work." So that would be my advice, open, forward-facing. A clear overall purpose, making it safe for people to experiment, safe to fail and expect some things will not work.  And, lastly, do it quick enough. Do short bursts super quick, and that helps you to stay agile, for want of a better word, in a disrupted world. Adam:            Yes, so if I'm hearing you, correctly, it sounds like the first step of going from disrupted to disruptor is a mindset thing? Michael:         Yes.Adam:            Because you've gone over a lot of very practical steps. But I think the first step seems to be a mindset because you need to change the way you think about things and see things, and then really figure out your why, in a sense. So that you can understand where your business is going and where you want to go. Michael:         Yes, I mean, you've got to look outward not inward. That's the first thing is, if you are looking for result and answers within, and spending too much time looking at processes, that's not going to help you focus on that. And don't be afraid to go broad beyond what your limit is. Like I said with the insurance example, who thought the training would be useful? And it actually brings back clients, it helps in so many different ways. You become a trusted resource to the client and it doesn't cost much to do it. So what else have we got? Really, it's making sure that we are hungry and curious to find out what's going on with the people we serve.  Adam:            Mm-hmm.  Michael:         That's it. Forget Your Troubles, that's the song, I know. So forget your troubles and focus on the client. Adam:            And one thing that we had talked about before, that I remember seeing in a report that we were discussing. It was saying that, "Safety drives courage, and courage drives experimentation." And I think that's a huge element, that when you feel safe, you feel that more emphasis to be able to, "Hey, I can make mistakes and I can do things, because this is..."  It's almost like, "I'm in a sandbox right now, I can do everything I need to do. And, yes, things may break but it's okay and we can fix it and get it back together." And I think that's really important, especially, for organizations and for employees who feel this. When things are disrupted the employees feel it the most, because it trickles down to them. And, so, for them to create that safe environment, it's not easy but it's essential. Michael:         You have to create, and that's what leaders don't realize, is that if they're frustrated, and they're worried, and they're concerned, your employees take the lead from you. The way you walk into the room, the way you describe the situation. So you could say, "Oh, we've got a big problem, we've lost 90% of our revenue." Which happened to me and a number of other people, they lost all their revenue, at the beginning of Covid, because everything just stopped.  Adam:            Yes.  Michael:         You could come in like, "Oh, my goodness, yes, we've lost a 100% of our revenue. I don't know what we're going to do, but we're going to try and find out. I need you to go and see if we can get some more money." That's pushing people in an away state. Oh, my goodness, it's scaring them. What you want to do, is to get them into a place where they can scenario plan, and that needs to be a calm area. Where people can adapt and say to them, "Look, the way we've earned money has paused for the moment, with Covid. It's no surprise that people have stopped doing whatever it is that you are doing, across all these industries. So how can we help our clients through Covid? What is it that we could do, with everything we've got available to us, our resources, our knowledge, how can we serve them? How can we help them?"  And that puts people, just by using that phrase, in a curious mindset, a forward mindset. And they're like, "Yes." That you are focusing them on helping serve people. Rather than worrying about the facts that your current revenue stream has dried up. Do you see what I'm saying there, Adam? Adam:            Yes. Michael:         It's a very different way. Just by the way a leader phrases problems to their team. It gives them that unleashing of potential and it creates, say you are creating a little bubble around your group, and focusing them on being curious, and trying to help move things forward. Adam:            What role has things like diversity, equity, and inclusion had in this disrupted versus disruptor relationship? Because I can imagine that it is a big part of it and it's becoming a big part, especially in our world society today. Of the things that have happened over the last hundreds of years have brought us to this point. What role does it play when trying to become disruptor versus disrupted? Michael:         Well, it has an immediate value to a leader, and I'm not sure that everybody really realizes that. It's having, "Wouldn't it be great if I could have all these different ways of thinking in my team and thought process?" Because they're more likely to come up with creative and different ideas to help us with this challenge. So that's the first thing. So diversity, equity, inclusion, which then equals to belonging, are all strapped together, they're a flow.  So I like the analogy of diversity, making sure that everybody got invited to the party. So there's a party, making sure that we invited everyone, that's a diversity aspect. Trying to get as many different people there and thoughts. But then thinking, "Well, the equity is allowing them to get to the party, access the party, physical access, be able to hear the music, see the music. If you can't hear it can they access this? Is it on the fifth floor of a walk-up building, setting things like that. But the equity is equitable, so all those diverse people can access it.  And then, lastly, everyone is being asked to dance, they're been included. There's nobody sat on the bench. They're like, "No, everyone come up and dance." Now, you know when you've got it right because belonging is affected, belonging is released. And belonging is a sense that you feel as though you belong. The fact that you are very diverse from all the other people you're working with, you belong.  So equate that to a party. That's when I've invited everyone over to the dance floor and they're all dancing like no one is watching because they feel they're comfortable, they feel they belong. Wouldn't it be great if you had all of your people feeling like they belong? They could suggest stuff. Well, they understand the purpose but they're free to make suggestions. They're not looking over, "Well, I don't want to say that because my team leader is here and he's going to laugh at that idea."  And there's a lot of examples we use in our training case studies, that show companies that have helped themselves get out of a hole and a challenge. And it always came down to having as wide of a spectrum of people to pull from.  But then they felt comfortable to share some ideas, and they came up with crazy ideas that would never work. But then that leads to the not so crazy idea that they've never thought of that does work. So that's how I see diversity, equity and inclusion, really, a powerful tool here in getting the right people to help you with the problems. Adam:            It almost seems like that when you get to that point that, what you describe, almost, seems utopic. That place that we may never attain to but I feel like we should be working toward that moment, where everybody can feel like they can dance and nobody is watching. And I think that would create the resilience that organizations need to keep going forward, in a sense. Michael:         Yes, but the leader is focused on their troubles and their challenges. But if you can focus on, "Hey, I want to create this environment where my people feel that they could say, 'What if? Oh, have you thought about this? I've never thought about maybe we could do this.'"  And you can do that with small exercises in the group. You don't have to spend money; you can get a group together. How you do brainstorming, innovation, creativity, there's plenty of examples and tips out there. You can just do with a team in a conference room. And one of my favorite examples is a colleague of mine, Jane Thompson, she does her work in the Asia-Pacific region. And she uses this case study of the problem of electricity companies in Alaska, where ice would form on the electrical wires. So we have in America, on those poles, and it would bring down the wires, and they could never keep up with it.  They were like, "Well, how do we get rid of the ice on the wires?" So they had a huge brainstorming event, they came up with all kinds of things. The crazy idea was, "We're going to put honey on top of the wire, the telephone wire pole." And they're like, "Well, why would you do that?" "Well, so the grizzly bears will come up" or whatever type of bear, I'm being a little bit exclusive, diverse, I'd say. Any type of bear that likes honey would climb up and in doing so would shake the pole and knock the ice off.  Now, do you think that would actually work?  Adam:            It doesn't sound like it. Michael:         It's a crazy idea. And we use this in our training to say, "Well, why would you come up with that?" But then it opened their minds up so much they came up with the actual solution. And all you got to do, they found out, is hire a helicopter, on those winter days, just after the precipitation has fallen, and hover over the wires and it blows the ice off of your wires, and you don't have the problem with broken wires.  No one would've thought of that before, no one. But they had to go there first. So, like you said, you have to aim for everyone feeling like they can dance, so no one is watching. You may never reach that, but that's not the point, the fact point is you're trying to open up their thought process because then they will access the real ideas afterwards. So that's just one example of many that are out there, that people can look up quite easily. Adam:            So we've been going a lot through this conversation, I think, it's been really helpful. But there's one thing I keep wondering in the back of my head is for that disrupted leader, who's trying to become the disruptor.  How do you still deal with the fact that, there is always going to be those minutiae things that are still there. They're still going to be there. How do you get past that or how do you still deal with those things? Because they're still there and they have to be dealt with, but also you want to expand your mind to these bigger things. So that you can become the disruptor and become a better leader, in a sense. Michael:         Well, I think, the fact is we're in this situation. And, so, you know in a month's time that you might go out of business or you need to get some game by the end of the month. Just by the changing the way you are acting straight away.  I'm not asking people to do extra work, I'm asking them to change the way they're talking, change the way they're interacting. Don't bother phoning up all the clients you know are not going to give you the business. Let's spend a bit more time looking at what people really need and talking to people in the industry. Do you see what I mean?  Doing all of these things that I mentioned before, on a day-to-day basis. And say to yourself, "Okay, the first week, we need to pick something that might work great. We're going to try this, two weeks' time, if it doesn't work, we'll try something else or if it works a bit we'll adjust it." So that's, that's the only real way through this because you can sit and worry about something that you know, "If we don't fix this, we're going out of business in a month or we're going to have to do something else." Let's get on board early. Change the way we're meeting; change the way we're talking to people.  If you have a one-to-one catch up stop talking about updates that you know in the current market composition that we have an end date, stop talking about that. Start thinking about, "What if?" Talking about what if in your one-to-ones.  So that would be my biggest recommendation. It's going to happen, so you need to get on board with, "Hey, if I keep doing the same stuff it's going to fail. So what can I do differently in the way I talk to people, where I'm looking for answers. Change who I'm talking to in the market. Let's try and unleash this, but know that whatever we come up with in the first week, we're going to try and move forward. [00:28:53]       < Outro > Announcer:    This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.   

Connect with our Speakers:John Macaulay: https://www.linkedin.com/in/johncmacaulay/ Colleen Lucero: https://www.linkedin.com/in/colleen-lucero/Full Episode Transcript:[00:00:00]       < Intro > Margaret:       So in this special podcast, Celebrating 50 Years of the CMA, or the Certified Management Accountant program. Margaret Michaels, myself, IMA's Brand Content and Storytelling Manager, will be talking with two CMAs. One who earned his CMA in 1975, soon after the CMA program had just begun. And another who earned her CMA quite recently, in April of 2022.  John Macaulay is a former IMA chair, who was among the first CMA program completers. He held a number of distinguished roles in the industry. Including serving as CFO of the telecom company, Royal Street Communications.  Colleen Lucero is a Manager of Client Analytics at Graebel, a relocation services company. Colleen earned her CMA in April of 2022. I am so pleased we could chat, today, with both John and Colleen about their CMA experiences and career journeys.  [00:01:15]       < Music > Margaret:       So, John, I'll start with you. I noticed in your bio that you did not study accounting as undergraduate major. Rather you pursued a biology and chemistry degree. What made you decide to shift into accounting, and how did you hear about the CMA program? John:              Thank you, Margaret. It's good to be here today and chat with everyone. That's a rather complicated story, but I will try to shorten it up as best I can. I graduated from college in 1965, with a degree in biology and chemistry. I was studying pre-med.  I had pretty much decided, by the end of my junior year, that I probably didn't want to spend another six years in school. And, so, I decided I wasn't going to medical school.  1965 was the middle of Vietnam. And, so, I signed up for Navy Officer Candidate School and I went and became a Navy officer. A guided-missile officer on a couple of different destroyers. And it was a great experience and exposure, for me, to not only international travel and different cultures, but also to leadership and the military.  When I got out of the military, I knew I wanted to go to graduate school and get an MBA. I hadn't settled on accounting at that point, clearly, but I knew I was headed in the direction of business. I had worked at a bank, in Cambridge, and I actually became the head of personnel. I was there for only a year and a half, actually, and after about six months, I became the head of personnel, we had 650 employees and 12 branches.  So it was a rather challenging decision to go back to graduate school. But I was accepted by Northwestern, the Kellogg School, and we moved from Boston, by that time I was married, from Boston to Chicago, and spent two years at Kellogg getting an MBA. And there I specialized in accounting and finance, Accounting, and Information Systems.  The second year, I became the assistant to the chair of the Accounting and Information Systems Department. And did some tutoring and wrote a couple of cases for him. From there, I went to work for General Mills in Minneapolis, and this was 1972, I started working in May. And in about September, my boss, two levels up, whose name was Jerry Ford, came around and said, "John, would you be interested in taking the CMA?" Well, I had actually refused, at Kellogg, to take the CPA exam, and I'd interviewed with some of the big, I guess it was the Big Six at that point, it may have been Big Eight still. And I told them I was willing to go into consulting, but I didn't want to be an auditor.  I had no interest in the CPA. And, so, they didn't accept me, but I had plenty of opportunities. And, so, I said to Jerry, "Sure I would. I'd absolutely love it." But I said I wanted a certification and I didn't want to be a CPA. I wanted to be a management accountant in business. So Jerry said, "Well, this organization, called NAA, is going to have this exam." And Susan's grandfather was actually a member of NAA and had been the president of the Boston Chapter many years ago. And I said, "Well, that's perfect."  And, so, we began to try to get ready for this exam, which we knew nothing about. And we held one or two, "Study sessions" in our headquarters, in Minneapolis. But we didn't have any real success because it was just a reading list. Some of the books I'd had in graduate school.  So, anyway, we went, it was a two-and-a-half-day exam at the University of Minnesota. And I listened to part of the previous podcast and Denny Beresford talked about the ice storm in Pittsburgh. Well, the second day we had a blizzard in Minneapolis, we actually lost the power. It was in the library at the University of Minnesota.  We actually lost the power, but there were plenty of windows. So we had a lot of light, and we just continued writing the exam, so it wasn't really an issue. I was fortunate, I did pass all five parts of the first exam.  So I say I got it in 1972, but IMA decided I didn't have, "Enough management experience" at that point, and, so, they wouldn't give me the certificate. So I actually got my certificate later in the second batch of certificates.  But that's fine, I didn't have a problem because I actually wrote them a letter and said, "Well, I think I have the experience and this and that." And next thing I knew they wanted me to be on an exam review committee. And, so, that's actually how I got involved with leadership in IMA, which I'll talk about a little bit later. Margaret:       That's a great story. It seems everyone, in the first class of CMA takers, had unfavorable weather conditions. To add to the challenge in taking the test for the first time.  And Colleen, like John, your undergraduate degree is not in accounting, but in Spanish Language and Literature. So what prompted you to embark on an accounting career, and how did you hear about the CMA program? Colleen:          Yes, so I got my undergrad in Spanish and I thought I was going to do interpreting and translating. So after I graduated from my undergrad, I started down that road and then realized that it ended up not being quite the fit that I was hoping it was going to be. But I was getting other certifications for interpreting and translating for large conferences, and even in the courts, and some medical stuff.  And while I'm doing all this, on the side I got this, what I thought was a transitory side job with a small business. And I ended up realizing, "Oh, my goodness, I actually love what I'm doing for this small business." With a small business, you put on all kinds of different hats.  So I was supposed to be just the office manager. But I ended up working with their CPA and doing payroll, and invoicing, and working with their books. And helping them make little decisions here and there, and working with their clients. And I started realizing, "Oh, my goodness, accounting is really just the language of business."  And I've always loved languages, and cultures, and the arts, and I never saw myself as an accountant. I was like, "Black and white forms and tax filing." And that's what I had in my head. And it's funny my mom had actually encouraged me, early on, to go after accounting and I was like, "That's crazy. No way, I just cannot fathom it." I took an intro to accounting class and I did well in my undergrad, but it just wasn't my thing. And it wasn't until I worked with that small business, that things came to life for me. And once that happened, I realized, "I think this is actually what I would love to do." And, so, I ended up going back to school to get my Master's in Accounting. But I was really frustrated because when I started working on my Master's in Accounting, the real big push was for tax and audit, all the time. And I'm like, "But this is not what I really want to do and this is not what I was doing." And I actually worked at the university full-time while I was getting my degree.  So, meanwhile, I was actually doing management accounting for the departments and the divisions that I worked with, doing financial planning and analysis. And I was working on their senior staff team and working with their strategic planning piece of things, and their operations, and finance decisions. And, so, I'm like, "I know that this is not all that there is." Even though there was this big push. So I was frustrated feeling like there was this middle ground, somewhere, that I just couldn't find. And then I took my cost accounting class and my professor promoted the CMA and had someone come in and do a presentation for us. And I was like, "Oh, my goodness, finally, this is what I knew I was seeing. But just hadn't had someone say like, "This is an opportunity here." So that's when I decided I really wanted to get my CMA designation. And at that point, by the time I graduated with my Master's in Accounting, I had had about eight years of experience. So I ended up getting my experience piece done first and then taking the exam afterwards.  Which I felt was really great because the CMA exam ended up just filling in some gaps. Where I felt, almost, like my accounting degree was really strong. But it left some gaps with some of the management side, that I was really working with on a daily basis. So I felt like it just fused things together.  So I went from this creative arts person, which I feel like I loved all the creative arts, never thought I'd be this numbers person. But I'm like, "This is all storytelling, and dealing with people, and helping craft their direction and stories." So that's how I heard about the CMA within my cost accounting class. And I'm super excited to be working with it and having just finished it. Margaret:       That's great. And I love how you said, "Accounting is the language of business." And, so, as a language person it makes perfect sense for you to pursue a career in management accounting. And you're not alone in understanding that these management accounting functions are happening all the time, but what are the words to describe it? What is the profession? And it's like discovering a well-hidden secret, and we hear that a lot. But it's great that you found your passion and that it's aligned with your language skills and your creativity. And shifting to another topic technology is increasingly, I think, a language in and of itself, too, now in accounting and finance. And at IMA we offer so many continuing education courses on technology because of that very fact.  And, so, John, you worked in finance for over two decades. So I know you have seen the evolution of technology up close. How did the CMA help you navigate changes in technology? And can you think of one technology that you considered revolutionary, in terms of how finance and accounting functions were performed? John:              Yes, and you're being very generous when you say two decades, it's at least four and maybe five, but that's all right. Anyway, in any case, yes, technology continually changes and as an accountant or a business person, period, you have to stay up to date, obviously, on the changes as they occur.  One of the things that really interested me in graduate school, particularly, was information flow and how information flowed. And it was very interesting that in the Kellogg School, at that time, they had a combination of accounting and information systems in the same department, and a lot of it was simply information flow.  But of course in the early, "Early days" information technology was the purview of the accounting department and the controller's department because it mostly was all numbers related. It's since expanded to the whole organization, obviously. But going back to just, strictly, the information flows. I was very interested in how information flowed in an organization and also the particular information that was focused on in an organization. And how that affected the actions that the organization took, and the plans that the organization made.  And sometimes these were numbers, but they were also words, in many cases, a while ago. And until technology really got developed and the numbers, and the analytics around the numbers developed it was primarily just information flows.  So the biggest example I could think of technology flows, and this goes way back. Most of the people listening to this may not have a clue what I'm talking about. But back in graduate school some other fellows and I created, as one of our projects, a program that generated an income statement and a balance sheet for a company. And in programming the device we had for inputs was punch cards. So we had a thousand plus punch cards in this deck. It was a large deck we carried around with us, and heaven forbid that we ever dropped it. Because even though they had numbers, trying to get them back together was a mess. So we thank goodness it never happened.  But that was the storage or the input device, for sure, back then. And that has evolved so much over the years. I mean, the storage today is amazing and you can get instant recall out of the storage and, similarly, with inputs. The inputs have become so flexible, and you can input almost anything into a computer and do some an analysis or work with it.  So that's how I've seen technology really evolve over the period I've been working. Margaret:       I've definitely seen movies with big computers and punch cards. So I do know what you're talking about, like NASA had to use it. But it is amazing how technology has gotten smaller, more compact and efficient, and you don't need a room full of computers and millions of punch cards.  I think people forget that that is the beginning of the technology that we're using today. It's those fundamentals that went into building everything that we use. So that's amazing that you've got to see this whole evolution.  And Colleen, like John, your role is one that depends upon acumen and technology, and a deep understanding of data. How did the CMA help prepare you for the challenges and opportunities associated with technology in your role? Colleen:          Yes, so I had been working with the technology side of things during my work experience primarily. So I feel like I got a lot of the base understanding just from having to walk through it and get the experience of working through the programs or softwares. And trying to figure out how to extract data and pull it from our database, and figure out how to put it together the way we needed to.   To try to make a decision and pull new pieces in and see how that would affect things. And I feel like I got a lot of that through my work experience, but there were still some gaps missing. Because I felt like I learned it on the fly all the time, and I wasn't like I took a class in my master's degree that helped me connect those dots, necessarily.  There was some technology and information systems classes that I took. But it wasn't necessarily on business decision making and some of the areas that I was really working in.  So it wasn't connecting the dots. It was isolated pieces that I was learning and I needed something to help pull everything together. Which I had been doing in my work experience, instinctually. But the CMA, I felt like helped bring a lot more confidence to that and tie it together.  I'm like, "Oh, I knew I was seeing it that way." And it made me feel a little more confident on the things I was doing right. And then helped highlight some of my weaker spots and strengthen those areas too. Margaret:       Absolutely, and we hear that a lot too, to learn the technology in isolation it can be really difficult to understand how it should be applied. And one thing we always say, too, and Jeff has echoed this in some of his remarks, "The technology is only as good as the people behind it." If the people behind it don't know how to draw the connections, or do the analysis, apply the critical thinking skills, the technology is worthless. So I think both you and John have made that point very well.  And, so, speaking of how technology has changed accounting and finance. A fun fact about the CMA exam, is that in 1972, when John sat for it, it was administered by paper and pencil. And, John, what do you see as the advantages of electronic test-taking today, as compared to how you had to take the exam? John:              Yes, I haven't taken many real exams electronically, but I have filled out surveys and a variety of things. But the real key, I think, is a couple of things; flexibility, and that is the ability to be able to take it almost anywhere in the world.  We have test centers all over the world right now, and that's a great benefit to test takers. They can take it at a variety of times. We don't have to have a proctor come in because they're at a test center, in most cases. And then the ease of grading, of course, electronic grading is so much quicker than somebody trying to do it by hand, with hundreds of papers.  So those are two benefits of it, I'm sure there are others. Obviously we can change questions easily. We can make the exam random, very easy, in a lot of varieties. I was on the Board of Regents for six or eight years, so I have worked with the exam extensively in that regard.  The other big benefit we've actually had is during Covid, obviously, this electronic testing made it much more possible than, if you think back, if it had to be in-person paper and pencil exam, at test centers, where we had to have proctors, it would've just shut the whole thing down. As it was in most cases, IMA was able to continue giving the exam in a variety of these test locations. In areas where individuals could get to the test centers and that benefited the individuals greatly, and, obviously, also benefited IMA. So changing it to an electronic format was a great decision and a good benefit for everyone. Margaret:       I agree. And, Colleen, having studied and prepared for the CMA which is a rigorous process in and of itself. Can you tell us a little bit about your strategy for preparing for the exam? Colleen:          Yes, I'd say I did a few things that I think were really key for me. One, I set a really structured schedule and just stuck with it. I have a little one who is now almost three, but at the time she was just a little under one when I started studying.  So the schedule was really crazy, working full-time with a little one. And I had just finished my master's degree and, so, I had a lot of things that I was juggling. And I knew that if I didn't set a strict schedule, I wasn't going to be able to really finish. And it's a really big endeavor, so I was like, "I got to keep to it." So my plan was, I'm very much a morning person. So I got up really early in the morning before she woke up and studied for a good couple of hours before my day even went going, got started. And I just stuck to that and tried to review throughout the day with flashcards. And I also hired a tutor because, for me, I love study groups and I couldn't really find a study group to work with.  So I ended up hiring a tutor to work with and that helped me feel a little more connected, and stay motivated throughout the process. Just because it was about three solid months that I just hit it really hard. So it felt like a sprint but in a marathon form. So I knew I was going to need someone to help keep me motivated. So having that extra connection was really helpful.  And I also chose to tackle the first exam first, since it was more accounting oriented and that was my strong suit. And the second exam was more finance oriented, so I knew I was going to need a little bit more work with that. So I wanted to tackle what I thought was going to be a little bit more... I could tackle it a little bit more easily or more quickly, I felt like.  So, yes, those were some of my strategies. I just stuck to a schedule, I tried to get other people involved and when I couldn't get a whole study group going, I got a tutor, and I got my family involved.  I made flashcards specifically so that they could quiz me and drill me. If they wanted to spend time with me, I'm like, "Quiz me. Start drilling me on concepts and things. But, yes, those are some of the things that I used to help keep me motivated, keep me moving, and actually get through the exams. Margaret:       I like that. It's, kind of, it takes a village approach to passing the CMA. But you're right, having all of those people around you, supporting you, and keeping you sharp is a great idea. Colleen:          I feel like they also felt like they went through the exam too. So everybody was relieved once we had all finished. Because we all had to get together to help Colleen finish this. So that was also really fun too, and it was really great. They've always been such a good support. So I needed that in order to keep motivated as well, they were a big element of that. Margaret:       Right, and now your toddler knows cost accounting principles now. So one of the things, and maybe our listeners are unfamiliar with the fact that to maintain the CMA certification. Every CMA needs to undergo some continuing education courses every year to stay fresh, current, and relevant. So, John, I'm curious, what was the most valuable, continuing education course you took at IMA? John:              As you just indicated, Margaret, because you have to stay current, you take a lot of continuing education. And I think the ethics courses were the ones that I found most interesting because they seem to be the most challenging.  In terms of some of the questions that got asked, some of the things that you didn't always think about on a daily basis. Obviously, as new topics came into the field, it was always interesting to take a course in that. Because then you could get the latest information on a new topic.  Also, I found the conferences to be very valuable because you got a variety of subjects over a two or three-day period. That would be of interest to you and you could focus on a specific track, and get a focus in that area, which was always interesting. The other part of what isn't exactly continuing education, but that I feel is key benefit of IMA is the leadership it can give you at the various organization levels. And within IMA, as I indicated earlier, I'd gotten involved with the CMA exam as an exam review.  I was looking at questions early on, and that led to involvement with actually the international organization. And then I relocated to Dallas and when we relocated here, I decided I needed to get more involved with the chapter.  So I got involved with the chapter and became the chapter president. Then I went on to the Texas Council and became the Council president, and I was on the board. But I'd been on the board earlier too. But in any case I, ultimately, became chair of the organization, and all of those different levels were learning levels of different things. And I often tell younger folks that, "Get involved with your local chapters, it's a no risk deal." If you are assigned to set up a dinner meeting and you mess it up. Well, you learn something and you won't mess up the next one.  And it's a good way, and it didn't cost you anything. If you did that in business it might cost you something in your status in that business, in your promotion ability, and so forth. But in IMA it doesn't really hurt you and, so, it's strictly a volunteer thing.  So take advantage of those opportunities, it can be an important learning and growth experiences for people. Margaret:       Yes, absolutely. And for younger people, too, they get that leadership experience before they might be able to get it at the workplace. So that's another really strong benefit of chapters and councils.  And, Colleen, I'm not sure if you've taken continuing education at IMA or if you've attended a conference? But can you speak a little bit about, maybe, a topic of interest, that you learned more about through IMA? Colleen:          Yes, and I have taken some CBE classes, and I did the women's conference, was it a couple of years ago at this point? It was all virtual, and I was supposed to go to the one in New York City when they were going to have that. But that was around the time Covid happened and ended up not working out. And I was really happy when I got to participate in the following year and they did it virtually, that was really cool.  I feel like there's a lot, I agree with John, I really enjoyed the variety of topics being offered at the conference and being able to glean a lot from a lot of different areas in a short amount of time. That was really helpful, I really valued that experience.  And I also think one of the CP classes that I've taken, that have stood out to me, has been a couple on data analytics with storytelling in particular. Because I feel like that's just really critical to a lot of the work that I've done.  It's a continual march of financial data and operations data. And what does this mean, and what do we do from here, and how do we make our next step, so to speak. And, so, that storytelling aspect is really important. So I think those are the ones that have jumped out to me the most, at the moment. Margaret:       Yes, the storytelling with data, I did a test for the pilot and I loved that course more than others because I'm biased, my title is storyteller. And, of course, Colleen, you had that creative side, too. So it's a nice combination when you can merge the creative with the accounting and finance skills. Colleen:          And I always feel like people think of accountants as isolated, in the back office somewhere, doing behind-the-scenes work almost like a human calculator. And I think that was the image that had pushed me off for so long.  Until I realized I'm working with people all the time, and communicating all the time, and having to interpret all the time from actually what I'm seeing in reports, and on the data side, and the financial side of things. And then I'm having to work with the operations team to see what's going on their front.  To see if what I'm seeing makes sense and together, the storytelling is not something that I do alone, it happens as a team. We all have to contribute to really seeing what's going on so we can fashion that story. So working with people all the time and I just love that creative and collaborative process. Margaret:       I agree. So I'm going to shift to the last topic. And I saved it for last because I think it's a really big topic that affects the long term of the profession, and the business world, and the world in general, and that's sustainability. Which is receiving a lot of attention in accounting and finance circles.  Because it's challenging accounting and finance departments to collect and analyze data, that is non-financial. ESG data; Environmental, Social and Governance type of data. And Colleen sitting in a role where data drives everything you do. How well prepared do you feel you are to account for non-financial or ESG data? Did the CMA prepare you for embarking on this emerging area? Colleen:          Yes, I think so. Again, going back to where I feel like I was learning a lot of these skills on the job but on the fly. And I feel like the CMA came and helped fill in the gaps, and strengthened some weak points that I might have had.  And I feel like the non-financial piece of things was one of those weak points. In my accounting classes that was always the focus. And you don't, necessarily, get into the other side and how it affects the finances necessarily. You do maybe a little bit here and there, but it's not so focused on the strategy piece of things.  Especially when they're pushing audit and accounting so strongly. A lot of it is having to do with larger companies, who are dealing with external reporting decisions, those kinds of things. But we're not talking about internal business decisions very often.  And, so, I felt like studying the CMA really helped fill in the gaps for some of that as well. And, so, I do feel like the CMA a prepared me to collect and be able to interpret non-financial data. And understand that it has, I guess, derive meaning from that non-financial data. And try to really figure out how it's being impacted? Where it's coming from? How it's being impacted by other things in the organization and not just see it in isolation. Margaret:       Yes, absolutely. And, John, having seen the positive and negative impacts business can have on society, over long periods of time. What are your thoughts on the emergence of sustainability reporting, and how can enrolling in the CMA program help accounting and finance professionals enter this new and evolving space? John:              This is very interesting, when you talk about the emergence of sustainable reporting. Because it goes back to something I mentioned earlier, which is the information flow.  This is another information flow within the organization. And it's an important information flow, in my mind, because, obviously, business does have a big impact on sustainability, over the long term, of our environment, and just the sustainability of business in general. And, obviously, there are good and bad elements. I think the key here is to try to pick measures that are appropriate for what you're trying to measure, and then be able to accurately measure those things.  I think too many times, as accountants, we try to be very accurate and sometimes we try to be too accurate. But we can't be not accurate enough either. We can't just have a best estimate out there. It might be a place to start but maybe not promote that as being the actual measurement. So I think the key is to get accurate measures and be on top of it.  The other thought I had was one of the things, I think, the CMA program does, and Colleen referred to this, was keep you up to date on what's happening. And not only does IMA offer courses, obviously, in environmental reporting, and sustainable reporting, but the CMA exam also incorporates things about it.  So it causes you to study, and just the idea of studying for the exam is extremely beneficial, I think, for people. And Colleen referred to that as well in her earlier comments. So it's a way to stay up to date on some of the latest trends, in what's happening in accounting. [00:35:23]       < Outro > Announcer:    This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.   

Connect with Simone: https://www.linkedin.com/in/bizwithsimone/Simone's Podcast: https://cannabisradio.com/podcasts/cannabis-business-minds/ CBM Network: https://www.cbmnetwork.com/courses/startupFull Episode Transcript:Adam:Welcome back to Count Me In the podcast that brings you inside the fascinating world of management accounting. Few industries have more interesting or infamous background than cannabis. From a management accountant's perspective, it's the story straight out of the wild west of business. Joining me today is Simone Cimiluca-Radzins, a leading consultant in the cannabis industry. We discuss our unique journey from a big four CPA to bringing accounting and finance order to attain businesses in cannabis country. Let's start the conversation.Adam:Simone, thank you so much for coming on the podcast today. I'm really excited to be talking about cannabis and cannabis and accounting and accounting in the cannabis industry. But to start off, I wanna find out how did you get into this industry and what's your story?Simone:I'm so excited to also be on. Thank you so much for the opportunity. You know, I am an accountant by nature. I grew up in a family where my dad is an accountant, a controller, you know, did the whole kind of accounting route and it just was the thing that just made sense going up in college. I was like, oh, accounting's easy. Let me go do this. And then got recruited pretty young in university to be part of PWC. And then it almost felt like my career path was kind of just set, maybe luck, maybe opportunity, you know, the combination of all of that. And I did, I did a few different corporate accounting type of jobs. Got to travel the entire world, which was amazing. Doing internal audit for one of the large studios down in Los Angeles and then moving to Paris for a few years and being able to do international consulting.Simone:I've always focused on accounting, right? So internal control development, processes, you know, process improvement. But it was nice because at that point, at the very end of my corporate tenure, I guess we could say it was an opportunity to really see how I could truly be an advisor and truly implement things instead of just telling people, Hey, you know what, you've got all of these control problems and see you later. Here's your audit report. And so that was a really nice kind of end towards my corporate tenure. And yeah, I think you probably hear it often that some people just get burned out and doing international consulting. That's how I felt like it was, you know, and it's funny saying it cuz it was such a dream when it was there, but then at the very end, it was like two weeks in Paris, two weeks somewhere else in the world.Simone:And you're battling jet lag. You're, you know, I'm in my mid twenties at this point, almost like late twenties I guess. And you're kinda like, well, hold on, I wanna hang out with people. I wanna have friends. Like, this is so fun. But at the same time, I feel like there's something more. And, you know, I decided to quit my job and I lost my visa living in Europe. I lost my visa and I went back to the US and started freelancing from one of my, you know, previous jobs. So it was a really great freelance gig and that started to get me into freelance and understanding, well, okay, this is really cool. Like, I have to do my deliverables and I can kind of just maybe build something on my own.Simone:And that's when I think the entrepreneurial bug started where I was like, Hmm, you know, I think that there's something more, but I didn't know what that more is. And in the end, I think I'm just getting there, right? And so that's like, oh, this is a while. So I guess to any listener who's feeling that it's okay to feel like you might not really know exactly what you want, but that there is something more. And freelancing, it was just a great opportunity. I can make great better money than I was making in my corporate gig. And I had just moved to LA and so I got a subscription to magazines. I don't know if if if people still get that, but when you move into a new place, you can get all these, these magazines. And I got this one.Simone:There was on the front cover, women in the marijuana industry. And I was like, what? Now I'd been in Europe, I'd been in finance I hadn't thought about, and it was marijuana then I call it cannabis now. It's, you know, the real term that you wanna use. I hadn't thought about weed, cannabis, marijuana since I was in high school. And I was like, Hmm, this is interesting. And I started really diving in into what is this industry? And at that time it's 2015. And so if we just roll back, there's not even two states that have legalized adult use and some obviously have, have legalized medical use. But, so it's all brand new. I'm in California, which is the Wild West, which is the biggest market in the entire world. And I just started doing this research about like, what is, I'm an auditor.Simone:I was like, okay, let me understand the ecosystem just like I would a business. I was like, okay, let me understand the players, what is happening? Like what is the supply chain and all of that. And I just thought to myself, okay, I think this is the industry that I wanna be in. And before I even got on my own, I thought, okay, but how do you really learn it? You learn it through the numbers. Just like I learned every other business, right? Like, you can understand numbers, you can understand how everything works. So I approached a CPA firm that was very cannabis, like, it was very clear they were working in the cannabis industry, which is not, you know, was not at that time something that you would promote. And I said, Hey, I can help you. I can help you with your sales, I can help you, you know, build, you know, a better process. And I had a year, a little bit less than a year working with them until I felt really confident that I could just go out on my own and start kind of building my own business and start kind of working on different projects in the cannabis space. So that's how I got in.Adam:Wow, that's amazing. So when you got in, it was still largely a cash industry, right? So I can only imagine how crazy that was because everything is digital currencies and all that stuff and the world of business today, even in 2015, it still was. And now, and in that time, how did you manage that?Simone:Well, so the interesting thing is, so there's twofold. There's, I got 80% of businesses still lack banking today in 2022. So you really have to have a good set of internal controls. And working with those businesses even in 2015, you know, you could just spoil it back to the basics. But what's fascinating is that they're, you know, there's almost something that you could call legacy industry, meaning operators that had been in the business before it was quote, unquote "legal" in that state. Right. So had probably got involved in, you know, if you think about California, there was an ability to truly build a business, even though it was a cooperative model starting in 1996 when there was the first dispensary. But from a federal perspective, and there's still a lot of federal issues, they were not supposed to hold their receipts. They were supposed to erase everything, which is an accountant's worst nightmare.Adam:Wow. I can only imagine.Simone:Yeah, so it was a lot of education and it still is a lot of education of, and I almost think this is a small business of, hey, we have to save receipts. Now when it's cashed, we don't have the law, we don't have bank statements that can get sucked up into the accounting system to even know what completeness is. No. We had to, you know, you really have to show people like this is very important. So I mean, the process was a lot of education and then system building, but very archaic is the thing that comes to mind. But very simple system building because you know, it's, this small small business owner, well just, I would say like limited business systems with the businesses that we're operating on. So it's just, it's really focused on the simple education, the easy to do type of, Hey, how do you upload these receipts type of thing. But what's interesting, are you aware of IRC § 280E?Adam:I've heard it. I'm not aware of it. I'm not aware like the define it. No.Simone:So this is one of the most draconian laws you can ever imagine. It was put into place in 1982 because a drug dealer, you know, filed his taxes and he was dealing with like meth, you know, like bigger drugs. And this is like, this is, you know, predating what the cannabis industry is now. But it hasn't changed. And the rule is that if you are trafficking in a controlled substance, the schedule one or two substance. And so cannabis is a one which is really insane because heroin is a one and there just needs to be some push at the CSA and getting this descheduled. But if you're trafficking in a controlled substance, one or two, yeah, you cannot deduct anything. No business deductions. Now there's been higher rate tax law that allows a business to deduct their cost of good sold.Simone:So it's actually from the federal level, the only deduction that a business can take is a deduction to gross receipts, which is cost of goods sold. So it's at a state level, it's different. Every state will say, Hey, you know, we allow you to take all the full deductions like any other business. Like that's how a state should do it. So these businesses are really hit hard because of working all in cash. Oh, I'm forgetting to save all my receipts. But at a federal level, they're still struggling because they can't deduct everything, meaning cash flows impacted.Adam:Wow. So your cash flow is greatly impacted and you can't take advantage of all the great FinTech that's out there for accountants. And so what are some of the nuances that you have to do? You know, so obviously uploading receipts is a big one to try to get them in there. But then also there's also the stuff that they do on the side. I don't know, there like, there's so many different intricacies in there. How, how can you, as like, how do accountants help? How can accountants help these small businesses as they get in there?Simone:Well, I think the first thing is the accountant needs to adopt the mindset that I am a true business advisor here. And I'm an educator. I'm not just doing bookkeeping, I'm not just doing accounting. I'm not going to be reactive. If they haven't sent me something, I'm not gonna do it. It's like a very proactive approach to being a true business advisor and part of the team. So that's like the first thing and that, hey, we're gonna solve the problem. And so I think if you are thinking about building your accountant toolbox, you're like, okay, well I'm aware of these bigger blocks, right? So the IRC § 280E, okay, that's federal taxes. Then really understanding state taxes and then getting them set up immediately on a business system, right? And so a lot of operators that, you know, I don't work as much now with operators in doing accounting.Simone:I do a lot of fundraising, but a lot of operators when I was working with them really are even struggling to have like an accounting system in place. So these basic, basic things, so the first thing is understanding the business and then understanding inventory, because inventory is everything and it's how do you manage? So being very, you know, up to date on cost accounting, management accounting. Because if you're working with a cultivator or manufacturer, we've got a lot of different inputs in our inventory, you know, versus a reseller where it's just like, okay, I bought this. If I have to add on maybe some freight, then I'll add on freight to get to an inventory cost. So there's a lot of just the first, the basics and being able to go in, roll up your sleeves, work with the CEO as I consider you a profit advisor and getting, just getting the systems dialed in. And then training is so important, really being able to delegate those roles to the business operators or somebody on the business operations team. Like I've seen accountants that have been like, oh, I'm gonna take on everything. I'm gonna do the invoicing I'm gonna do. No, you can't. You have to make sure that you really are taking the role of a profit advisor if you're just, you know, bookkeeping or doing freelance kind of financial consulting, that you really can almost segregate your duties with somebody else on the team.Adam:Yeah. Well that goes back to having setting up good internal control. And I'm sure that those small businesses as they're getting into this industry, especially if they were doing stuff beforehand and then it's suddenly legal and they were like, oh, I'm gonna get a legitimate business. I don't think they had good internal control set up. They probably didn't have very good business practices set up. So it's almost like as a business partner, you're coming in as the CFO, as a financial analyst, as a data analyst, you're coming in as all the roles that an accountant does in an organization that like a management accountant does. And you're having to set all that up for this business. And I can't imagine that's easy at all.Simone:It's not easy. And I think the big thing that I learned was like setting boundaries and setting expectations. Setting boundaries. And so, you know, one thing that in the industry specifically, because there's so much innovation, there is something new, there's something changing all of the time. There's new states that are onboarding and there's, you know, there's so much, it's very easy as entrepreneurs in that space to get caught up in all of the shining objects. And so as an accountant, if you kind of follow that suit, you're not really helping the business. And so it's very important to, you know, set the expectations, be nimble, like the, you know, be nimble because you know, there are pivots, it's all of it is the startup culture, but really practicing discernment and having, you know, almost a plan, right? The project plan of, okay, here's where you are. Well this is where we can try to get to you in 12 months. And bit by bit going there with, it's just the focus of really building internal controls. I think that was the coolest thing when I got into the industry. I was like, oh my gosh, this is like all of my corporate tenure. It like all of what I've learned, you can actually apply into this space. So, but for me it really is internal controls.Adam:I mean that's great. So IMA, Institute of Management Accountants is one of the core founders of the COSO, which is the Council on Sponsoring Commissions, which came out with that internal control. And so we're big into internal controls here. And so like, I think management accountants could be a huge into this industry. And so what if somebody wanted to get started in this industry, you know, should they go find a small cannabis shop and say, Hey, can I come and be your accountant? Or should they, you know, be an entrepreneur like you? What, what would you recommend?Simone:Well, I first recommend getting educated. So making sure that you feel very comfortable about the state taxes, the federal taxes, what systems you would use and kind of your game plan. And then you made a really great point is that within that education, you know, the cannabis industry is quite complex. We're talking agriculture, manufacturer, retailers, right? And so being able to service all of these, well all of these different license types or parts of the supply chain, they have very different viewpoints and they have very different, you know, even accounting, if you think about it like an agricultural business is gonna have very different accounting than a retail business. So first understanding, you know, where do you want to play in this field? And then if they decide to go, you know, the job route, oh my gosh, I always have Indeed. Like I have a RSS feed, Indeed cannabis accounting.Simone:There's tons of jobs, you know, there's always tons of jobs. So there's an opportunity to do that. Or if you're thinking about the freelance route, then, you know, finding kind of an approach to reaching out to somebody in your local area. I know there's a lot of remote accountants right now, which is, I mean I'm one, I'm in Portugal at the moment, and yeah. And I think that the coolest thing for me about being in the industry was being able to connect locally with business operators. And because you're really heavily involved if you're in an emerging market, which would be like New York for example, like licensing is about to happen, regulation is passed. Like there's just this environment of like what is happening then you really, if you can, you wanna be there and you wanna be part of it. You wanna go to local events that are organized by community organizations.Simone:You want to, what was so cool for me is like getting involved in the politics. Like this is something where you have an ability to, you know, talk to legislators about, you know, do you really like the regulation? Is the regulation set up for success from an accounting perspective? And it's something that I'm even working on even remotely. But I would say if somebody is in a state where there is adult use or medical use, try to find out what's happening locally and just get your feet wet. Just how I did it. You know, be that, be that researcher under ask so many questions because this is like from a business perspective, such a fascinating industry from an accounting perspective, such a fascinating industry. But from a health and a wellness perspective, it is just fantastic of what you can be part of by supporting these businesses that are, you know, helping people with their pain, helping people with their anxiety, helping people, you know, with feeling better. And so there's so much that somebody can do just if they're interested is just get involved locally.Adam:That's great. I think that's a great way to get started is just kind of start where you are and then kind of go from there. I mean, that's how everybody gets started really. I mean, you just find people to talk to, get involved in events, find local things that you can, local shops, local conferences that are happening. Cuz I know it's all happening all over the place, which is amazing. And what I was thinking as you were talking, the more good accounting that can get into this industry, that set up a good foundation so that someday I hope when federally they finally say, you know what? We should take this off the schedule one or whatever it is, that there'll be good accounting in place so that way when the federal regulations come into play, the accountants be like, we got this.Simone:Exactly. Exactly. Well, not only that, if you think about just small business and some of the statistics, small businesses tend to go out of business within five years. Like I think it's like more than 80%, which is a devastating number. And I believe operating in the cannabis industry, it's even harder because of the punitive taxes, because of, you know, the cash flow issues. And so having good accountants in this space and helping these small businesses withstand the storm of still we're in federal prohibition, right? Federal prohibition to get to in a day, and hopefully it's a year very soon where there is an opportunity where it's completely federally legal would be great for the small business owner, right. To be able to like, be part of this industry and make it all the way to federal legalization. And I believe accountants that are true profit advisors are the ones that can actually do that.Adam:Yeah. Well, and it's funny, you're, as an accountant, you're kind of forced to go back to your, your roots of, like you said, like the first things you did when your corporate accounting, even just things like cash flow management, like something as simple, you know, it's a very popular course at IMA cash flow because people still have to remind themselves, okay, like it's crazy. But when you're dealing with cash, cash flow it's actual literally cash in and out.Simone:Yeah, yeah. Right. It's cash flow, it's cash management. Like, you know, what are we actually going to do with this money? But then it's also safeguarding assets. Think about it, cannabis businesses, tons of cash, tons of cannabis. Frauds happen to all, we already know, small businesses have a lot of fraud. Yeah. And so imagine if you're in a cannabis industry that has limited cannabis business that has limited internal controls, it's a haven. It stresses me out, honestly, as a as a former auditor. I was like, just like the lack of controls and the opportunity to, to commit fraud. And then what is really interesting and quite negative in the fact of being interesting is that IRC § 280E well what, you cannot deduct anything besides your cost of goods sold. So you cannot deduct losses. So if there's shrinkage, if you have a loss that's not cost of goods sold, that is a loss. And you can't at the federal level actually book that loss. So exactly. So it's, it's, to me it's getting as many accountants educated to help get those businesses profitable to with, you know, to really to make it towards federal legalization.Adam:Definitely. Well, and I can only imagine the hardship that that would put on a small business, especially if there's fraud. If there's, I mean, even for individual consumers, if you get wire frauded, the bank says, well, sorry, that's the, that's our little loophole and FDIC, we're not gonna help you because you were wire frauded. There's nothing we can do if we can't get the money back. And so I feel like when fraud happens, there's not much help out there for many people.Simone:No, no. And I think that and that is such the very sad part of the equation. And I think the silver lining to that is, well, education and preventative controls and really educating somebody about that. And I think that what happens in small business and in cannabis is all small business and startup, is that people don't wanna prioritize that because it's not sexy. And that's why the accountant have to be proactive with it. And we had to make it fun. And I think just showing people like, Hey, we can work together and I can actually help you save money, meaning more profit for you, that's the big thing.Adam:I agree. Anything else you wanna share?Simone:Well, I think that you wanna share with every listener just a little bit of a history about the cannabis industry, because that was one of the interesting things when I got involved with it, I really learned a lot, I learned a lot about politics, I learned a lot about health, and I learned actually a lot about myself, which is not the point of the history of cannabis, but you know, it's been federally prohibited for a very long time. And in 1995, there wasn't a single dispensary in the United States like California legalized medical use in 1996. And then from there we have seen like such accelerated growth. And one of the most important things that I've seen with new legislation is that there's a lot of things, you know, a lot of rules or programs in place that really help with what had happened with the war on drugs because minorities, people of color were really impacted by the war on drugs.Simone:And, you know, by receiving a federal, like if you are impacted by the war on drugs, what's that mean? You might have had to go to jail just for having a small amount of weed on you. And now that's completely legal in most states, but what happens with that is that if you have gone to prison, you can't vote. So there's a lot of interesting things for that. The cannabis industry and legalization of the cannabis industry is bringing from a political perspective that I just wanted to share with everybody that it's a really cool opportunity to be part of an industry that is a game changing, that is like, the rules haven't been fully written yet, and you have an opportunity if you care about politics or if you care about, you know, making a change in the system. The cannabis is like a very, very cool industry to do that.Simone:And from the the health perspective, you know, if you don't know much about the plant, it's much more than just getting you high. Like people have been able to help and cure cancers, you know, just like end their stress and their anxiety. And there's kids with epilepsy that have used cannabis that now don't have seizures. And like the list and list goes on. And what's very cool about the cannabis plant is that research, like there was a bunch of Israeli researchers that in the 1990s discovered in our body the endocannabinoid system, which is similar to like your pulmonary system or your nervous system, like it's a system in your body that has been discovered since the 1990s that helps you build homeostasis in your body. And cannabis, THC being the primary, you know, molecule into cannabis is something that actually, you know, binds to our endocannabinoid system.Simone:So what's really cool about this is that, you know, growing up in the finance world and being part of corporate finance, it was a heavily drinking culture. I really didn't open my mind to these other, you know, plants, medicines, and like, what, you know, what are the opportunities? And so I just, you know, if you're curious at all about that, just do some Google research, endocannabinoid system and what are the benefits of cannabis because it's so much more than, you know, eating weed brownies and like stoning out on your couch. Like it's really a plant that can save lives.Adam:And I hundred percent agree with that statement. And Simone, thank you so much for coming on this podcast, which it's been very educational and I hope our audience enjoy it as much as I did.Simone:Awesome. Thank you so much Adam.Outro:This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Connect with David: https://www.davidredwards.com/contact-usCheck out David's book: https://www.davidredwards.com/about-newyouwhoknewFull Episode Transcript:Adam:Welcome back to Count Me In the podcast that explores business and leadership topics from the management accountants perspective. I'm Adam Larson. I'm joined today by David Edwards to discuss how organizations and leaders can overlook the human when dealing with human capital. In other words, businesses can often see their people as assets before they see them as, well, people. David explains how this mindset often backfires on organizations and why focusing on values that motivate human beings provides a more balanced and effective approach to collaboration and productivity. And just a reminder, David,has a new book out entitled "New You! Who Knew: Surprising foundations to get more done, feel more connected, and stay balanced in a rapidly changing world." There's a link in the show notes, so make sure to check it out. Let's start the conversation.Adam:So David, thank you so much for coming on the podcast today. We're really excited to have you on. And today we're gonna be talking about people and the value they bring to organizations. And traditionally, as we all know people have always been looked on as assets. And through your book and through conversations that you and I have been having, you don't agree with that. So let's start there. Why don't you comment on that?David:Yeah. So if we go back into history, right, we haven't actually literally had people on our balance sheet for since 1860 roughly. But we treat people still very much like their assets. And you might recall, I mean, we go back into, just in my career for example, Jack Welch he made famous this kind of policy where they took the bottom 5% of their performers and then summarily fired them. And you know, and you don't wanna be in the 5% obvious, the bottom 5%, you don't want to be anyway. But you know, if we look at math, there's always gonna be a bottom 5%. You know, by default there's gonna be the top 5% and the bottom. And so, you know, this is a way of looking at human beings that says you're an asset. We look at how corporations over the years have, you know, you just move people around or we used the word drive.David:To me, this is non-human. So for example, I was looking at a job description the other day, and it, and it said, you know, drive, I think three times, we are gonna drive innovation. You're gonna drive change, you're gonna drive performance. So since a corporation is little more than a collection of human beings who have come together to accomplish some common purpose, right? So as a group of human beings moving towards some goal, trying to accomplish some purpose, if we think about working with human beings or as human beings working together, let's think about you, Adam. Are you married?Adam:Yes.David:If you go to your wife and say, Sweetheart I hurt my knee and I need you to drive me to Home Depot so I can get a new ladder. And if you drive me there and get me there, hmm, let me see in the next 15 minutes, you're a good wife, I want you to drive me there. So how is she gonna respond to that?Adam:Not very well.David:Not very well because you're treating her as if she was the car, right? You can treat your car that way and if your car doesn't get you there in 15 minutes, you can say bad car, you suck. And might have some other more colorful language, but you would never do that to a human being, at least I hope not, right? Because we're not machines, we're not assets. We are in fact human beings. And if we want to be successful in business or in life or in any relationship, right? We would want to say, Well, what are the principles not of a machine, or not really even business principles, right? You can't ignore business principles, but how do we want to engage with fellow human beings? And that should by definition make us more successful.Adam:So if we wanna be more successful, you mentioned something about principles, maybe we can dig into that. What are some of these principles that we should be implementing till we can be better human beings.David:So I think one of them that works very nicely as a human being as well as in business, and I'll kind of go on the business side at first. How many businesses do you know, have a statement that says, these are our values.Adam:A lot of them do.David:Right! Maybe even a majority of businesses have gone to that effort, right? So let me ask you, in your experience or talking to people or just in your life and career, how many of those businesses, I'm getting a little distracted here, but how many of them have a statement? But you know, that company well enough to know that they're not really living those values?Adam:You know, I can't say that I've taken the time to look at value statements to to, to pay attention well enough to know whether they are or not.David:Yeah. Or maybe another way to look at it is, is you've ever gone into a business and been a customer of a business. And if you ever have anybody, you know, listening or watching has had this experience where they go, you know, I don't know what their values are, but they're not, at least not today. Yeah. I mean we've all done that, right? We've all had that experience.Adam:We've all seen that, of course.David:So values as a company, I believe are extremely important because they set boundaries, right? Businesses by definition have some goal that they're trying to accomplish. And inevitably they wanna make a profit, right? This is kind of, it's part and parcel of every business. And so what values do is they set some boundary within which that company has said, we're gonna set some boundaries or limits around how we pursue these goals, right? Our business goals. And that's good, right? Because you really don't want to be operating and like anarchy basically, right? Anything goes, you know, whatever it takes. I mean, we've seen that it's happened in business probably not infrequently. People like Enron and you know, some of these kinds of, you know, famous examples, but where they go, hey, there's no boundaries. We don't have any values. We're just gonna go make a dollar.David:And you know, that's all that matters. However we do it, you know, that's, we don't care, right? The means justify the ends, that kind of a thing. So values are important in that regard. And it also is one way that we start to engender trust, right? If we have values and we're actually living those values, there's greater trust in between individuals and trust, right? As I think Steven Covey's son wrote the book, "The Speed of Trust", right? And if we don't have trust, you know, we pay a tax. None of us likes taxes, right? So I mean, we pay a tax for that. The same with human beings. And that's why I think values in a business as a collection of human beings makes perfect sense because values as human beings make perfect sense. And so we think of them as a constraint sometimes or as barriers, but it's much like the freeway.David:We've decided a long time ago that if I'm gonna be going 70 this way and you're gonna be going 70 in the opposite way, that having a big concrete barrier in between those lanes is a really good idea, right? Because it makes us safer, because it makes us more confident, more comfortable. We actually will get places faster because of that barrier, right? Because we're never gonna veer over into the other lane and run into somebody. And that's gonna slow everybody down and ruin those couple of people's days for sure. So we create these barriers for a reason and it's valid. And when I was writing my book, it was actually one of the most exciting things cuz I've always thought values were important, but in kind of a vague way it's kinda like having vague goals, right? Well, you know, someday I kind of wanna do something, you know, that's not very powerful for us.David:But when we take the time, and it's not a lot of time, right? Usually most people can go through and make their top five core values explicit within a couple of hours. So it doesn't take, you know, hours, it doesn't take a degree. It just takes a little bit of effort on your part. But if you'll go through the process of doing that, here's what the science tells us. Here's what researchers tell us. We will have a greater sense of meaning and purpose in our life. We will have a greater sense of wellbeing cuz you've made this explicit and wellbeing is based on this feeling that imagine that as human beings, but you know, we have feelings. And so this feeling that my life is on track, my life is kind of okay, I like the direction that it's going. Partly because, you know, you've made these core aspects of your life explicit.David:You actually avoid fuzzy thinking, enjoy greater clarity and focus, and finally you have less regret. Cuz here's what typically happens. You do something or you talk to somebody and you hear about something and you have this vague sense of that feels good, right? That feels right to me. Think about a LinkedIn post that you've seen in the last few days if you're on LinkedIn or Facebook or whatever, otherwise, other times you have something that vaguely feels like that makes me uncomfortable, right? I don't know what it is, but that just kind of grades against me. I don't know what that is. And again, that's the, the difference between having something that is vague versus something that is specific and explicit. And so, you know, by going through and making our values, we have all of these benefits as human beings make our lives better. And so this as a principle, as something that can guide human success is a powerful underpinning to what we call our personal motivation as well. When our values are explicit, we have motivation to pursue our goals because of those advantages that I just talked about.Adam:That all makes a lot of sense. You're bringing up a lot of different elements that I feel like we're gonna have to touch on, but when I think about applying this in a business setting, it all seems very good in theory. However, there are power structures set up in place and how do you transmit value in this value that you're talking about when people sometimes have different values, right? And in a setting that is set up as a top down structure, Like how does, how does that work?David:Well, if you're lower on that structure, there's no doubt it can be more difficult. But here's a conversation I would suggest that you have. If your organization doesn't have any values, you know, they've not made them explicit, I think you can ask the question and say to your boss, why don't we have any values? You know, what are our values? And you might do a little bit of research and think about why does it matter, right? Just like, kinda like what we were talking about. There's a lot of people that have written about values in business and what their role is in business. Why you should, you know, you're better off for having those values. And you don't have to go very far or have read, you know, business literature for very long to understand and see examples of businesses who don't have values around living their values.David:And you know, at some point to think about it, we talk about people getting caught, you know, the whole idea of being caught, you know, is it kind of grates against our, our nature, frankly. And so I think you can have a conversation and say, What about values? And I think if you're higher in the organization, you know, you can very much more legitimately have a conversation, you know, with your peers and maybe, you know, if you're not at the top of your organization start saying, you know, why don't we have values? And if you do have values, I think you can have a very specific conversation with whoever your boss is and say to your boss, Hey, you know, here's my report and here's how you know my work is going. And I was listening to a podcast the other day, and they talked about values, which just really kind of, you know, resonated with me.David:And so I really think it's important that we live our values, you know, we've got these values, it's on our website and you know, some people put 'em on the back of their business card or you know, whatever else they do, it's on the wall at the corporate office or whatever. And so do you agree that it's really important that we actually live those values and he can have this conversation and hopefully, right, if they have integrity, they're gonna say, Well yeah, duh, of course it is. And you can say, you know, I don't control what Mary or John or Jose or somebody else does in another division, but in my division I really wanna reinforce us living our values. Will you support me in that? Right? So what you're doing is you're having a conversation, one human being to another, and you are setting some ground rules, right?David:Which is a really good idea in any kind of relationship. What are we agreeing about? Things that are important, right? And so we've just, we have this conversation and hopefully we get to a point, you might have to have a few conversations, kinda like, let me think about it and let's get back and talk about it next time. That's fantastic, right? That's even better some ways cuz it means that this is an ongoing conversation. It can have a little more depth to it, a little more engagement in this. And I think that's very healthy. But hopefully you get to a point where you have permission to say with your boss, this is really important and we agreed to that. And then you can work with whoever you are working with, you know, on your team or if you're a supervisor, you know, your, your group that you're supervising, that values are important. And then you can start to have this conversation with your peers and your direct reports and then it can grow from there. And that's, it's kind of a, you know, in nature, all things start small and as a part of nature and human beings, you know, that's usually a good idea. Further says this company wide edict and values are important and, you know, and it becomes another program or another thing. And this becomes very organic and natural and people are gonna, it's gonna be more powerful, more influential.Adam:So do you think it, it still can be just as powerful and influential when an organization gets to a place where like, okay, we want the values to be measured in some way. So they put it against your personal performance assessment in some way where okay, you need to measure yourself against our value statements. Do you think it can be just as effective when it's done that way?David:I think it can be as long as anything that we do can be made pedantic, right? It can be made superficial. I check the box. I mean my very first job outta high school, I sold Cutco knives, and you know what? Nothing against Cutco, I still have those knives from 1978 and they still work great. I send them in every five years. They sharpen them for me for free and they send them back. You know, they've been great knives. So there's a plug for Cutco knives. You know, when my first meeting with my sales manager, you know, I'm just green outta high school and he says, Dave, how many people did you call this week? And I said, Well, I don't know. And he says, Dave, look at your report here. And I started giving him this, you know, narrative. I like narrative. And so, and he said, No, Dave, wait, wait, wait.David:Like if they see this box on my report, I have room to put a number. No more than two digits. So how many people did you call this week? Well, I think six. And so, you know, the idea was, you know, that we were very specific, but that can become pedantic, right? I just called people and it wasn't meaningful, right? I wasn't using skill I, whatever. But at some point, you know, you gotta get on the phone and you gotta talk to people or you're not gonna sell anything. So there's some value to it, but it can become kind of pedantic. And so the idea I think to keep it from being pedantic is again, to be more explicit. So just like we talked about in our personal values, we need to make them explicit as a corporation, I urge if you have corporate values that you describe them not in, you know, a page long, I think as short as possible, a sentence or two or three at the most that says if we have a value, let's say transparency, one of my own core values is one of our core values, right?David:To make any of these values explicit, you need to define it. So what does that mean for me as an individual if I'm doing my own or for a company? It would be what does it mean as a company? And it's not necessarily right or wrong, right? In other cases, it's not right or wrong. It's simply that we as an organization, as a group of people have agreed that this is what this means to us in our setting. And so you define it and then you say, what does it look like? What does the behavior look like? And again, you don't want a big paragraph, you know, you want a sentence or two or three that kind of says, this is what this looks like here for us or as an individual for me. And then you finally, there's three steps. The third step is that you say, why?David:So what, why am I or as an a company, why are we better off for living this value for, in other words, making those behaviors a part of our daily walk, our mental model of you all how we process. Cuz that point, it's only at that point that that value becomes profound and powerful and it provides those benefits to a single individual, you or me as a person or to a corporation, which is a collection of individuals who've agreed on these boundaries. And we've taken the effort to define them, to talk about the behaviors that reflect that and why we're better off for living it. So for example, in transparency, for me as an individual, I've defined it simply as I don't have hidden agendas, right? I'm not two-faced. And that's as simple as it could be. And it doesn't have to be any fancier than that.David:And what is my behavior, what my behaviors, if I'm working with Adam and John and Jose on a project, I don't tell John something so I can get what I want outta him, add something different so I can get what outta him and Jose, something different so I can get what I want outta him, right? And there's one story and we all share that same story, that same narrative. And I don't have to remember what I told who, So my life is simpler and easier and I also build trust cuz that's a necessary underpinning of trust in any kind of human relationship, right? We wanna think that when we're talking about something that's kind of the real deal. And I don't have some hidden agenda that's driving, you know, some manipulation or something. And that could work at a company as well, right? We don't have hidden agendas. We're straightforward with each other. And that's how we reflect that behavior or that value in our organization as we're working together as human beings towards these shared purposes. And it's, again, this isn't the master course, this isn't the, you know, MBA in business. But this is a foundation that even with our MBAs and our advanced degrees and all the fancy stuff we have, if we ignore the basics, we suffer the consequences. It's inevitable.Adam:Yeah, we do. One thing that comes to mind is there, there's a lot of manipulation that comes with businesses, that comes with politics within business. How does one keep the values when they're trying to navigate politics of business, when they're trying to keep their ethical standards up high? It's not an easy task. And what you're describing sounds great in the perfect scenario, but we rarely are in the perfect scenario.David:We rarely are. There's no doubt. So I think two things, One thing for you as an individual, and here's what the, another kind of surprising thing when I was doing my research was that about 80% of us have never made our own core values explicit as I've described. And so I think that one of the things that we can do to add power to any conversation that we'll have or any effort that we have to live our own values, right, as a foundational thing is to make them explicit. And just by definition, most of us listening or watching the podcast won't have done that. And again, it doesn't cost any money, it takes a couple of hours. And you could have this additional power and motivation in your life. So a couple things are gonna happen. So in any business we always want to get from point A to point B, right?David:At some level, at some project, right? We're getting from point A to point B as an accountant, right? You, at a most basic level, you wanna take raw transactions and you want to create useful statements so that we can make better decisions, right? We have a point A, we wanna get to point B and as we, you know, used to talk about GIGO, right? Garbage in, garbage out. So in order to do that, you have to have two things. And I use Google Maps as an example. So if you and in Newtown, where's a city that you've never been that you would like to visit? Adam,Adam:Toronto.David:Toronto, up in Canada, right?Adam:Yes. Never been there. Beautiful.David:So you want to go to Toronto you get out your Google maps, you're visiting, right? You show up at the airport, you're looking at the map of Toronto, you don't know where you're at, right? You don't know where your starting point is, but you found this restaurant that somebody recommended and you wanna go there, you can see where it is on the map, but you have no idea where you are on the map. How successful are you going to be at getting to the restaurant?Adam:Not very.David:Not very, right? Google Maps won't even let you proceed unless you can say, find where I am, you know, you know, divulge my location. Or you can say I'm at this corner of this street and that street. It isn't gonna build a map or a course to get there cuz you gotta have a beginning and you gotta have an end, right?David:You gotta starting place and you gotta have a goal, an ending place. And so when you wanna get from one place to the other, so what we're talking about is values as a company and as an individual. If the company has taken the effort to make their values explicit, you have to start from some place to say, how do I relate to those goals? How do I interact? How do I feel about those goals so that I can actually, you know, say yeah, I'm comfortable living them. So you've gotta have a starting place and that starting place is in fact your own explicit core values. And once you've got those, you can then map a course between your personal core values and the corporation's core values. And if you can do that as an individual and within your sphere of influence, you can encourage that.David:You can have the other human beings that you work with who say, you know, Dave, that just makes sense or Adam that makes sense. And so we agreed to do that, right? And you start small and again, it's kind of a natural process and if you're higher in the organization you have more influence but you are still one human being. And I've been a CEO or a CFO for probably about 30 years. And one thing I've learned is that even as a CEO, I have very little influence to change behavior. I can say no very effectively, right? I can cut off funding for a project or say we're gonna change direction or that kind of stuff. But when it comes to things like values or strategies, my power is very limited cuz I'm just one human being and an organization of any size, it takes a lot of human beings to move something like values or strategies forward, right?David:So then we have to use the principles of human success to engage in creating that kind of change. Cuz we're talking about is not pedantic, it's not superficial, it's really much more profound as an organization or as an individual. And so, but as a leader, what you can do as I recommend you start small again, maybe you start with your own direct team and you have start these conversations cuz the start at the bottom, we can start at the top, it can start in the middle. Each of us has a power to influence within our sphere of influence, you know, no matter how small or large that is. And that's where I would start. Make it a pet project. You know, a little side project, get permission right? From whoever your boss is. So as a CEO, my boss was usually our board of directors.David:So then I said, this is what I'm doing, this is why I think it's important. You get their buy-in. And if you're, you know, at the bottom of the organization, you're a first level supervisor or you're not even a supervisor at all, talk to your supervisor and say, see I was on this podcast and I had listened to this conversation. I think this is really important. What do you think? Can we have a talk about this? And you can start wherever you're at. And that's really key to life as human beings, right? We strive to have influence over things within our sphere and we recognize that most things are outside of that. So we focus on what we can do, not what we cannot. Cuz that's gonna lead to frustration, depression, anxiety, all kinds of things that you don't need in your kind of wheelhouse. And so you'd start where you have influence and you start a conversation. Cuz as human beings, that's how we connect and that's how we decide on what we're gonna do, what we're not gonna do, what our standards are, what they aren't, et cetera.Adam:Yeah. It goes back to that, that old adage of accepting the things that we cannot change, right? That old serenity prayer that, that people still do every week, you know, accept the things I cannot change. And it's accepting that, you know, I can't change the world, but I can change myself first and if I change myself first, then it'll ultimately affect those around me. And then essentially it may affect those around them and it'll expand from there. So exactly. We have to look inside ourselves first. So before getting overwhelmed by what's happening around us, basically.David:There's a pattern in boy, I can't even remember what chapter this is in, chapter eight or nine in the book or something, but I talk about there's three kind of general directions that we can go. We're trying to solve a problem typically, right? So you, let's say you've made your own core values explicit and you find there's a disconnect. Your company either doesn't have values or they have paper values that they're not living right? And this is gonna create some anxiety, some what they call dissonance in your life. And that's okay, frankly, really that's good because it means the second principle of the book. So the first principle is values, the second is awareness, right? Cause it means that through this process of your own development and becoming a better, more powerful human being, right? A more directed self-aware, guided human being, a more person with a more meaningful life and existence, right?David:All these good things. What it means though is that you've increased your awareness as well, which is really the second principle, talking about you gotta know where you're starting and you gotta know where you're going, right? So the beginning of that is where are you, you know? So what are my values and why is this making me uncomfortable? Let's talk about in a workplace. I had a guy in my house the other day who was a technician. He had worked for an auto company, he was a, you know, a service manager and this what he's, I quote, "I was forced or required to lie to my customers every day". And he said at some point it became so uncomfortable for me, I could no longer stay, right? And so what's gonna happen is, is you start on this journey, you know, this is a self-development journey.David:That's something that we start whenever we want in our life. And hopefully it continues throughout our life, throughout our career, throughout until the day we die, frankly, right? It's not like we have an end place in how we evolve as a human being, but anyways, so you gotta start someplace. And that's awareness. It takes awareness to do that. Both of yourself and as well as what's going on around you. But you might find like this guy, you know, he has practicing some awareness and he had a sense of his own values and he said, This is so uncomfortable. So you can zoom in so you can work on reinforcing how do I operate within this? Right? That's one legitimate kind of course of action. You can zoom out. So you talk to your manager, your supervisor, you have this conversation, right? You try to get a little, you know, if you're a union, you know, you talk to the union.David:Again, every situation's gonna be a little different, but you look at this sphere of influence. So you zoom out a little bit and say, how can I get some help here? How do we get some consensus? And then finally, you might have to zoom away. And you know, like this guy decided, he said, I'm not gonna change this. This is, you know, here long before I was here. And the other guys I'm working with, it doesn't bother them that much. So I'm never gonna get my car fixed here. And I'm gonna zoom away, right? And so we all have these kinds of decisions to make, but it's healthy, right? What is not healthy is just taking it every day and cuz it wears on you. Yeah. It creates anxiety. It can create all kinds of negative things in, you know, our mental space.David:And since we're all connected, right? Mind, body is all connected every time that we have this disconnect, this dissonance, unless we can address that directly, it's gonna wear away at us. And it makes us less effective as human beings. It takes away joy out of our life and we just won't get as much done, right? And we won't evolve as human beings. And so we need to deal with that. And ignoring it is just not gonna work. That doesn't serve us, It doesn't serve our companies well. And you know, by extension, as a group of human beings of nearly 8 billion folks, it doesn't serve our common humanity.Adam:I think those are very wise words and I encourage everyone to get a copy of the book. We'll put it that in the show note. David, thank you so much for coming on today. We could probably talk for another hour about this subject, but I just really wanna thank you for coming on.David:Adam. Thank you. It's been a pleasure.Outro:This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Connect with Aparna: https://www.linkedin.com/in/aparna-iyer-7a6a135/Full Episode Transcript:Neha:Welcome back to Count Me In, the podcast for management accountants making an impact in the business world. I'm Neha Lagoo Ratnakar from IMA. Today I'm speaking with Aparna Iyer, the treasurer and head of investor relations at vPro. Aparna's career. Got off to quite a promising start when she earned a gold medal for the highest score on the exams by the Institute of Chartered Accountants of India. She's gone on to hold many roles across the accounting and finance function at vPro, and along the way, she has constantly pushed herself out of a comfort zone to keep learning new skills and developing her empowering approach to leadership. We cover a lot of ground in this fascinating conversation from robotic process automation to the benefits of ambition to how we might be working in the Metaverse sooner than you think. Let's get started.Neha:Welcome to Count Me in, Aparna. It's such a pleasure to finally meet you for this conversation.Aparna:Thank you, Neha. It's an absolute pleasure, and I'm looking forward to this conversation, actually.Neha:Awesome. So let's start with an obvious question that's been on my mind ever since I'm knew about you. You joined vPro more than 19 years ago, and our generation is infamous for job hopping, right? Tell us more about your long and successful journey at vPro.Aparna:You know Neha, I'll just tell you briefly about myself. You know my father worked in a nationalized banking in India, and I in, you know, all the way up to 23 years when I joined vPro. I have not stayed in a city more than two years because we've been always hopping schools, colleges, you know, so for me, also, I'm quite taken by surprise that I actually managed to spend 20 years you know, in one place. And I think the credit actually needs to go to the organization. Because, you know, when I joined vPro, I was very impressionable, you know, rearing to go. I think what vPro really does well is, you know, it paces your career for you, right? I don't spend more than about three years in a role give or take. And every three years there is always something that's in the works for, you know, what next, how can things get better, bigger?Aparna:So in some sense, I've been truly you know, privileged and lucky that you know, I got an opportunity to work through multiple roles, multiple leaders, and the sector itself has evolved so much through these last you know, 20 years. So much more complexity. So much more M & A. You know, we've had you know in the last 10 years, you know, we've had so many new leaders join in. So the organization itself keeps changing. There's so much to learn and there's, it's such a growing sector that I, you know, I didn't even realize that I had spent 20 years. The other thing that we project does well, and, and is perhaps one of the bigger reasons for me staying back is in vPro finance, we really build you know, we hire people from campuses and then we build careers for them.Aparna:So all my peers are pretty much tenured in vPro, and we have like a shared history. So the camaraderie, the collaboration is just you know, off a very different level, which all of us thoroughly enjoy. So I would say that you know, other than what the organization puts in, it's what my peers put in both in terms of the kind of benchmark they set, how you know, enriching it is to work with them, how it is to learn from them and, you know, really contribute in the process, right? Like, work becomes fun when, you know, it's just extended family. So I would say these are, you know, two reasons why you know, it just work. And like they say, why fix something that's not broken?Neha:Wow. And that's been quite a journey. Thanks for sharing it with us, and I hope other companies are taking note of these excellent practices.Aparna:Yeah. Yeah.Neha:So what has been your biggest challenge in your career so far?Aparna:Neha? You know, I think every time you take up a new role, you feel that, oh my God, this is just so much more challenging than you know, what I've ever done. But, you know, truly I was most apprehensive about was coming back to work after I had my daughter. And that I think would have been perhaps the most challenging phase of my career, because I was just coming back from a six month long break at where I was doing something completely different, right? And somehow when I joined back, and I never thought I would feel like that. I felt very low on confidence, and I wasn't sure whether this is what I wanted to do. Is this the purpose? You know, I felt so overwhelmed you know, taking care of a young baby and coming back to something very intensive at you know, in the vPro finance, it was perhaps one of the, you know, phases where I really needed help, right?Aparna:From all my mentors, from the organization, from my peers, from my reports. And thankfully, you know, that that phase, you know, lasted for about nine months to a year where you know, I was just wanted to find my confidence again. And, you know, once that happened, right? And time, with time every quarter, it kept getting better. You know, all us finance professionals live quarter, quarter, say quarter, like they say, right? Three or four quarters under the belt, I was feeling a lot more confident, again. So that I think was one of the most challenging phases because, you know, I needed to find that balance and make sure, you know, I was getting it right. So that was one point where I felt you know, I really needed the support of the ecosystem. The other part was when I, you know, took on something like treasury and IR, you know, invest relations, the current role that I did, that I'm doing I took this on three years back and you know, I'd not done treasury at all in the first, you know 18 years or first 17 years of my career, knew nothing about markets, hedging investments, and, you know, we all are exposed to it as finance professionals, but I've not done it, you know, with a KRI to exceed a certain benchmark.Aparna:Coming in and knowing when you know that you are the person who's perhaps knows the least about that subject in the team, and yet you are the leader, I think it poses very different challenges. So, pushing myself out of the comfort zone, being okay with the fact that, you know, for another six months, I'm going to be the person who's gonna be least informed in a room, and yet I had to lead it, yet I had to bring my perspective to it, yet I had to understand and learn and, and work with people. So I think that was also another challenging phase, right? But it's only a matter of time, you know? You just need to apply yourself. So that's the other myth I busted, right? So a lot of them say they don't wanna try different things because they're just so concerned that, you know, how will they add value?Aparna:What I really understood about adding value is you, your, your vantage point can be so different, and the value that you bring to the team or you bring to a function can be so different. It may not always come from the tried and tested path, You know the vantage point that you'll have is very different, and you bring way different perspectives, and you can always add value no matter what you do. Cause everything else is just adjacent. So, you know, those are very good learnings for me. And it was challenging and I was very unsure and anxious many times, but I think you had to give it some time and, you know, you lace it.Neha:Wow. Thank, thank you for sharing your personal story so close to your heart, and also finding your feet after motherhood, but also in new functions, adding value with your diverse perspective. Let's take a minute to talk about growing. We talk a lot about future-proofing our careers. What do you think are the competencies of future for the people in both leadership positions and also for our listeners from accounting and finance profession?Aparna:You know it isn't easy to future proof your career, right? I think, and it is getting increasingly difficult. You know, at least the first 10 years of my career, it, you know, the world around me was not changing at the pace at which it is right now. I think there is just so much more information. There's so much more that some a professional can do today. There are different ways of learning but, you know, I think you know, to each their own. But if, you know, I had a method to this whole madness, it would be to just say that you must allocate a dedicated time every week where you are reading. And it could be a finance journal. It could be something that you've signed up as a course for, or it could be just reading a very you know, it could be a newspaper that you subscribe to, which you must absolutely, you know, absorb newer things, newer perspectives, newer point of view.Aparna:You must understand what's happening in the world around you, in the world of finance. You know, you can pick up a topic like mergers and acquisitions. You could look at corporate actions, you could look at macroeconomics. You can, you know, taxation, You know, take a subject that's close to your heart and make sure you read everything about it. Right. Other than that, like I said, you know, so take out dedicated time. It could be, you know, a Saturday morning, 10 to 12, or a Sunday morning, 10 to 12, when you really will just read you know, a good quality journal or a good quality magazine, so that's something that's very, very fundamental. And other than that, I think it's, you know, learning has become far easier than it ever was. So you must get yourself into online courses, right? And, you know, for example you know my CFO, just in the lab, he's constantly studying, you know, every year he adds a course to his resume.Aparna:Now, that's something that I'm inspired by. I haven't done that. But there's so much you can learn. You can take up a course on cybersecurity, you can learn what's happening in the world of AI, what's happening in the world of blockchain. There's several courses available. So, you know, I would say that, you know, just like the way we take care of, you know, ourselves every day by setting aside, you know, time for, you know, walking or gyming or physical like that, you have to find dedicated time, which you will put in honing your professional skills. And nothing substitutes reading, nothing substitutes you know, keeping yourself informed of what's happening in the world around you. And I think that's something that's a basic. And apart from that, if you're able to take out time and, you know, go ahead and enroll yourselves in, you know, courses where you can keep yourself abreast of, you know, all the changes in, in technology, nothing like that. Because everything today comes with a package in a package with technology,Neha:Right? And although you called it basic, but it's such a powerful insight that you just shared. I love it.Aparna:Yeah. Yeah, you know, yeah, it's basic, but, you know, getting basics right is often the most difficult thing.Neha:Absolutely. Getting it right and making it a habit, that's what eventually adds up.Aparna:Yeah.Neha:Awesome. You used a few words, like the technology related words, something that your company is great at, vPro works in the field of cloud computing, cyber security, AI, all these hot topics, these buzzwords that we keep hearing about. How can accounting finance people make sense of these new technologies coming up every day so they can just let go of the noise and focus on what's important and how can they best use it in their functions?Aparna:You know, all of them pretty much start like buzzwords. And you know, it's very, you know, when you look at it, it sounds vague at first, and you are really wondering how can this ever, you know substitute what you're doing today in your Excel sheets or in your ERP. But you know, as finance professionals over the last 10 years, we've witnessed certain technology trends that have proved us wrong. You know, life is no longer about, you know, knowing Excel and ERP. Those are things of the past, right? Today you know, let me take a simple example, like data dissemination, right? Having a single source of truth, making sure the data that you have at the central level becomes accessible to people who need it the most in the business. Empowering business leaders rather than, you know, having approvals come to you.Aparna:How do you empower business by setting aside budgets, right? So that people can decide where they would like to spend rather than have every approval come to finance. So a lot of the, there has been a subtle shift in mindset. People expect you not to be the controller, not just to be that person who approves your bills, but they want finance to really move the needle and actually participate wholeheartedly in enablement and empowerment. And you know, for example, how do you like run a company which is to lack 50,000 insights like us. It's almost like running a country. You can't do it using Excel sheets and ERPs. Yeah, you need to democratize data. You need to make sure insights are available for business leaders, as in when they need them. How do you really go through that part?Aparna:And what is a technology cycle? And the only way you can make this happiness through technology, and I think we've all learned it, and everything that we spoke about, whether it's robotic process automation, whether it's AI, you know, all of that has really changed our life today in the way we operate in vPro finance. And I'm sure it's true for, you know, any organization, everybody's looking at digitization, right? You know, we've done, you know, what started as a pilot, you know, we started using artificial intelligence for, you know forecasting revenues. And you know, when, when that work, we grew in confidence and we then extended it to other areas, right? How do you use you know, data analysis for fraud detection? How do you look at patterns and learn from those patterns and identify payment behaviors and therefore, you know, what could potentially be a credit risk?Aparna:So, you know, these are all things that, you know, we've used very effectively. You know, how do you, you know, like, you know, lot of shared services that we, run, whether it's for vendor payments or it's for employee reimbursements, you know, we extensively use chat bots, right? Simple things, right? How to improve both the efficiency, effectiveness and the experience at the same time in a large organization. Like, you know, we have to go back to using technologies like this. So what is buzzword today? Like, maybe Metaverse. I'm sure five years down the line, Neha, when you and I are talking, we will be using Metaverse for training. I mean, very clearly that's one place where we will all learn, right? Maybe, you know, you know, we all meet in the metaverse and we have our conferences there, we collaborate there, we've got breakout rooms.Aparna:You know, I think the technology is there, and I think the proof point of the technology is clear. How do you use it is what I think all of us are grappling with. And a lot of us have made several strides in using blockchain for reporting in using, let's say RPA for ever so many items including, let's say, reconciliations. You know, anything that's you know, routine standard can be easily automated using RPA. We've all used bots extensively, so, yeah. You know, all these things that look like it was far fetched are reality now. And we are adopting technology at a pace because, you know, we've all seen the benefits it has. So I'm very confident that, you know, we will continue to, you know adopt some of these things that are buzzwords today in a big way. Again, five years down the line, we will, like I said, we will be talking about technologies like Metaverse, digital, how do you work? We are all working in a hybrid world. How do you work half in physical world and how half in the digital world and I think some of those answers will be provided by some of these technologies.Neha:So true. And I love your take that it's not let's not get carried away by the buzzwords and thanks for sharing some of the application, part of these new technologies and how people can be using them.Aparna:Right.Neha:All right, So let's pivot from these learning resources to actually learning from you, your leadership experience. Tell us about your experience of building and managing teams over the years. How do you make sure your team is not just performing well, but also feeling well that they're actively engaged?Aparna:Neha, I must confess that it was much easier when we were all only in the physical world, it was much easier to lead a team. It was much easier to know the person because, you know, you make an eye contact, you shake hands with someone. I think it makes a big different difference, you know? Today when I pick up the phone and I talk to someone, and when I cannot make that eye contact, when I can't gauge the body language, I think the conversations become very transactional. Very quickly, you move to, you know, how are you, okay, fine. Now this is what we need to get done. How do we go about it? As opposed to, let's say if I'd met the person, I would have perhaps realized that the person's looking tired. I may have asked a follow up question. We may have had an opportunity to know something just beyond work, because I always feel that if you really have to be a leader of a team, you need to know your team in and out, right, inside-out.Aparna:You need to know what's happening with them, around them and how they're feeling, Right? You spoke about how they're feeling. I think that's very, very critical. We are very challenged because, you know, we are all working in a virtual world. And and therefore, I think there are some good habits that all of us can you know, doubt. Maybe in the current times, I make sure I always make, I give the person some time to settle down. When we are doing a call on teams or on phone where you make the person feel comfortable, talk a little bit outside of work, understand what's happening. Are you okay? Is this is a good time to talk? Are you fine? And learning to trust, right? Because it becomes very, you know, it is anxiety even for the manager because, you know, you really don't know whether your team is productive enough.Aparna:Are things happening at the pace at which it should happen, especially when the outcomes are not coming. These interventions become difficult. So you've got to do these things very sensitively. You should not come across as any time as you're not trusting. So these times it's very difficult, but, you know, you've gotta check your natural instinct and, and learn to trust, learn to be more patient and learn, give people more time. But otherwise, you know managing teams, it generally, I mean is all about, you know, for me, setting the agenda, reviewing, and then, you know, doing, helping them in course correction see if outcomes come, then it's your team's credit. But when outcomes don't come as it's the job of the leader to step in and coach and make those interventions and do that course correction so that, you know, you can reach the goal. I genuinely believe that's how you lead. You set the goals, you review it for how it's happening, You give enough delegation, and when things are not working, that's when you step in and you come in to help how, you know otherwise that I'm a pretty hands off leader.Neha:Wow. And while you were answering that question, I was wishing that we were having this interview in person, because you're right, there's so many things that get lost when we can't see the non-verbals, right? And I love your mantra of success to lead a team to being hands off and delegating as much as possible, but being there when they need you.Aparna:Yeah, yeah. You know, I once heard this, and I don't know if it's a true incident, but that, you know, when there was a rocket launch that was happening, and Abdul Kalam, Dr. A. P. J. Abdul Kalam was leading that you know, rocket launch, and Vikram Sarabhai was also there. And they were all very excited. And the press was called. And, and when it did not go as per, you know, schedule you know, Vikram Sarabhai asked Dr. A. P. J. to just step back and said, Okay, now you leave this place. I'll take the press conference. And he took all the flack, and the next time when the launch was absolutely fine, he just let you know, Dr. A. P. J. do all the talking. And he said, now my job is over, I'm flying back. And I think that is an excellent leadership, you know, lesson. And that I think caught my eye. And I truly believe that when the chips are down, leaders can make a huge difference, because they need to own up and be there and protect. If everything's fine, then, you know leaders can just take a back seat and you know, let the team bask in their glory. So I think that's a very important lesson that I learned.Neha:So true. And, and when you were telling that story, it got, it brought goosebumps to me. So thanks for sharing that, and thanks for holding that philosophy close to your heart as you lead your teams in vPro.Aparna:Yeah.Neha:All right. You touched upon the hybrid work life and how teams are working in this new environment. How has your life and work changed in this new environment?Aparna:It is very, very difficult. Like I said, you know, teams are all over the place. And, you know having them engaged, especially young chartered accountants, young CMA graduates, people who join us you know, they are the energy, right? They are the backbone of this organization. And it is very tough for us that we don't get to interact with them enough because they're all in their homes. And, you know, very often, you know, people are very shy. They don't wanna come on videos, we don't wanna push them. So I feel that, you know, the connect, especially with the young people who are joining raring to go full of energy, who are ready to observe, right? Like, just like how you say a kid you know, the, you know, when when they're growing up to the age of, you know, eight, they absorb everything that's happening around them, and that perhaps mold you know, how their personalities are going to be when they are late, let's say 20 or 30 years old.Aparna:Much of that gets formed in the first formative views of, you know, for six years is similarly, you know, when someone's joining you fresh from campus, you know, they are so moldable, right? So when they come in, we, you know, we'll be very happy to have them in a vPro campus, mold them in a vPro way, instill our values, instill our culture, let them know what we stand for. And I think that's what we perhaps miss the most, because we are not able to perhaps put that bond, that umbilical cord of, you know, what we stand for, right? And this, these are the vPro values. This is how a vPro leader is, and this is how, you know we do business. It has become much more, more tougher. But, but, you know, again, going back to technology, thankfully, at least we have you know, collaborative technologies.Aparna:So we are using in our workplace where we at least able to do everything virtually. We've all adapted ourselves to having these, you know, chime in, HR sessions, everybody gets their own tea, you know, comes together. We have more. So what has happened is to compensate, you know, the lack of, you know working, co-working, we all communicating, right? So everything gets communicated. We have more calls, you know, we make sure people have understood, we make sure people have heard us. There are more emails, there are more calls, there are more webinars, there are more training sessions that people can take up at various times, you know, whenever it's convenient. So, yeah, you know, there are more both pluses and minuses. I would say for me, because I come from a traditional law school way of thinking, I feel the minuses outweigh.Aparna:I would really like us to at least get to a more effective hybrid model as opposed to a hundred percent remote. But I do understand that there are pluses, you know, there is better productivity. People are staying with their families, so they're far more relaxed. You know, they're less stressed because, you know, they have they don't have to come here. They're not homesick. They're not running around for you know, to do their chores. They looked after. I think it's a win-win, if you look at it that way, they're able to work with a company like vPro and yet be with their families, which are in smaller towns. But I worry that sometimes the exposure that you get when you are in the line of sight, that'll be missed. And I genuinely don't know how leaders, like, I mean, today we have a leadership bench who've all worked in only physical world.Aparna:Now, if we were to continue like this for another 10 years how will you produce leaders for tomorrow's vPro or tomorrow's, you know, large organizations that I think we have not yet seen, you know, those proof points haven't been met, I think. Yeah. So we'll all evolve and we'll have to see how the future unfolds. For now, things are good. I think we are okay with a hybrid model. We are asking our employees to come in three times a week when they can, where they can. And I think for now, that will do. But as, like I said you know, time passes and hopefully we are all with the pandemic is well behind us. I truly hope people do come back to physical offices because that's where you really build culture, and you gain exposure, you gain independence, and you know, you truly can, you know, wait it, and magic can happen.Neha:Wow. Waiting for that magic and waiting for the world to find that equilibrium where both remote and in office is accepted. And we find that right balance where people are happier, but also productive.Aparna:Correct.Neha:All right. So it, I have so much to ask you, but then we don't have enough time. So time for one final question for the day. If you wanted to leave our global listeners with just one message, one takeaway from our talk today, what would that be?Aparna:Hmm. Have a burning ambition. Never you know, feel shy to raise your hand and go for it, You know, chase your dreams. Wholeheartedly. I think magic happens when you really put up your hand and say, I want this, and I want this to happen to me. And then, and like they say, the universe conspires. So I think ambition is key, and it's important that you raise your hand and ask for it and make the most of it.Neha:Wow. I can't think of better parting words than those. Raise your hands. Thank you so much, Aparna. This brings us to the end of our show today. But thank you so much for your wonderful chat and sharing your insights with us.Aparna:Thank you, Neha. Wonderful talking to you.Speaker 3:This has been Count Me in imas podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit imas website@www.imanet.org. 

Connect with Ryan: https://www.linkedin.com/in/ryan-goral/ https://www.gspiregroup.com/ Full Episode Transcript:Adam:Welcome back to Count Me In, the podcast focused on management accountants driving business forward. I'm Adam Larson. Coming up I speak with Ryan Goral about unlocking the full potential of small businesses through mergers and acquisitions. Ryan is the founder of G-Spire Group, a consultancy focused on companies often overlooked and underserved when it comes to corporate development services. When it comes to M & A, big companies all get the headlines. The reason is pretty simple. A deal worth billions of dollars will always draw more attention than a deal that's only worth millions. This focus has contributed to the perception among many business owners that they're simply too small or inexperienced to participate in M & A. Ryan explains why M & A is a strategic option relevant to virtually every business and highlights the critical role management accountants play in corporate development success. Let's start the conversation.Adam:So Ryan, I just wanna thank you so much for coming on the podcast today. We are gonna be talking about mergers and acquisitions today, and I was looking at the recent Bain and Company Global Report from 2021, and they were saying that the total transaction value for M & A was an unmatched $5.9 trillion in 2021. So it seems that M & A is on its way back. The last conversation I had about this was back in 2019 and it was much under that number. So maybe to start off you talk a lot about, in your business about the benefits of growing your business through mergers and acquisitions. So maybe you can start by covering what are the benefits?Ryan:Sure. Thanks for having me. Yeah, the, you know, companies can grow through acquisitions for a number of reasons and it's strategic, you know, really what is their strategic reason for growing through acquisitions? Yeah, trillions of dollars. I think the M & A market's been real, really red hot. You know, the market that I serve, I serve privately held companies that are on the, you know, 10 to 50 million in revenue range. So my transactions I'm typically working on is way, does not have a B or a T in the title. But I think that, you know, the last couple years we've seen a couple things that are driving M & A activity. One has been the historically low interest rates. So the cost of capital has been, you know, really, really attractive for a buyer to go out and secure debt and even equity for that matter to engage in transactions.Ryan:That would involve buying a company as part of their growth strategy. You know, and the various strategic reasons or I guess categories if you wanna call it that, that a company would really wanna look at as part of a growth plan that would involve M & A. You know, you see companies you know that I think talent is one, you know, that I've seen companies wanting additional talent and maybe the labor force right now, which it is, it's constrained. So a lot of these companies have all the work that they ever would want, but they'll have people in the labor to satisfy it. So, you know, growing through an acquisition to pick up key talent is kind of one strategic motivation. There's other kinda strategic reasons. One being size and scale from a cash flow perspective allows the company to, you know, invest more into other certain strategic initiatives.Ryan:So size also equates to sometimes more value. So if your company is trying to improve shareholder value, you know, size does impact that value. So you'll see kind of acquisitions as part of, I just want to get bigger and grow. I try in my practice, try to hone in the strategy a little bit more than just let's grow because you wanna make sure the acquisitions are aligned with that strategic importance. But the types of acquisitions typically see are you're buying a competitor. So that's kind of market share strategy. You see acquisitions that are maybe of a supplier, so you call that vertical. You're trying to, you know, own the supplier so you can enhance your own margins. You know, sometimes you'll see a geographic strategy where a company wants to grow into other geographic areas that are strategic for them. And making an acquisition in those kind of geographies is sometimes the right strategy.Ryan:And then, you know, really the last one that there's a number of reasons, but the other one that comes to mind is, you know, expanding your product and services to your customer base. So if you're, you know you've got one product, one service that you're offering, maybe your customer's constantly asking you for, Hey, do you do X, Y, Z? And you're like, no, we don't do that. Go talk to ABC company. Maybe it's a good strategy. Go buy ABC company so you can have another product service to offer your current customer base. So those are some of the strategic reasons that drive M & A. But I think the trend that you mentioned to start off here was you've got cheap capital and you know, as you get into bigger transactions, you see, you know, if a public company has, you know, a stock price that is historically, you know, very high, sometimes they're using that stock as currency, which is another driver of the activity.Ryan:So there's, there's a number of reasons, the amount of M & A activity that we've seen. And the last one that I've seen and more that's more in my market is you've got, you know, kind of an unprecedented amount of baby boomers retiring and their business is typically their biggest asset. So you're seeing kind of a transfer of wealth from one generation to the next that's occurring cuz there's a good amount of baby boomers that actually own privately held companies. So you're starting to see that activity happen and I think that's driving the market too.Adam:Yeah, so there's a lot of great benefits out there as you've just described. And so with somebody looking into, get into that, one term that I've heard is corporate development. So why would that, why would that matter? Maybe you can start by defining corporate development in terms of M & A and then why is that beneficial to develop to, to why does it matter as a small to medium size business in your getting into mergers and acquisitions?Ryan:Yeah, so corporate development is really more of a term that you'll see in larger companies. These are companies that have entire departments, corporate development departments, and they're these departments, sole responsibility is getting the company ready and then sourcing, closing and integrating acquisitions on behalf of the entire organization. So they are the M & A team of these larger companies. They're just called corporate development department. In my work I've seen, you know, that that service doesn't really exist for those smaller privately held businesses for a couple reasons. One, it's, you know, you can't, typically there's not enough resources to hire a full time corporate development executive, you know so, and then the other, the other reason why you don't see it much in the the smaller privately held company spaces, they're usually run by owner/operators. And these are folks that are really good at running their business.Ryan:They're really good at managing their employees and customers, and they tend not to have time or capacity to think about M & A and how other, you know, partnerships and alliances could be beneficial to them growing. So that's just a capacity challenge. And then there's a lot of these privately held businesses have never gone through like a substantial transaction before. So there's a lack of capacity and there's a lack of really kind of, maybe we know how of going through a process of going out and acquiring a business and making sure that it, you do all the things that need to go into that transaction. So why does it matter? It, you know, I think there's a big opportunity for these smaller businesses and I define 'em as, you know, five to 10, up to 50 million in revenue is kind of the companies I typically am working with.Ryan:And the couple things that I see, and it gets me really excited about bringing corporate development down to lower middle market is one, the amount of value that can be enhanced with an acquisition is pretty substantial for a smaller business. You know, if you're, you know, running a flooring company that is a $10 million revenue, you know, maybe you're doing roughly, you know, a million bucks of EBITDA or cash flow, you might be worth four or $5 million. What happens as you get bigger from this size is, let's say we go out and make a couple acquisitions that involve, you know, you know, half a million dollar cash flow businesses. So let's say we do two and we get the 2 million of annual regular cash flow. Well, that multiple just went from four or five to six or seven, and the multiple goes up due to a couple reasons.Ryan:One, there's a lot of buyers looking for those bigger cash flowing businesses. Two, the size of your organization requires you to professionalize the business. Which a lot of times these transactions will remove the owner operator from being the business being so reliant on the owner operator and moving them. Really, I call it, you know, it's a transforming business owners into more of a CEO. And that process also improves the value of the business cuz a buyer typically wants to see the organization be, you know, efficiently run, no reliances things that they would if the seller, the main owner goes away, they still wanna see the asset performing. So bringing corporate development or helping companies grow through acquisitions is both a value enhancer. It's a lifestyle enhancer to a lot of my clients. You know, they do want to get out of the weeds and move into more of a CEO strategic role.Ryan:And those are, you know, a lot of times the main drivers. And then the third, it's, it's a risk management. You know, if you're on the smaller end, then a Covid hits and you, you know, stuff comes to a halt, you know, business is at risk of going under the bigger you are. The thought would be hopefully you're got a more diversified customer base, you've got more cash flow, hopefully you've done some more retainer. If you've done a good job retaining earnings and maybe you've got some cash, something like Covid hits, the risk of you going down is perceived to be less. And so those are the main reasons why it is relevant to these privately held companies.Adam:So where does the accounting and finance professional play into this? You know, it sounds like they would be be part of that corporate development team in the bigger organizations, but if you get down to the smaller organizations, sometimes your accounting a finance team is one or two people, is your CFO who wears a number of hats, can maybe we talk about where the accounting finance team comes into play because mergers and acquisitions have to do with transactions and money, and that's your accounting and finance team is helping analyze that, you know, making sure everything's in place. And so maybe we could discuss that a little bit.Ryan:Absolutely. So corporate development supplements and helps the accounting finance function. You know, and there has to be a lot of collaboration. So a lot of the strategy and the growth and the projections that go into creating a good M & A plan largely is coming out of the financial side of the business. And when I first start kind of onboarding a new client, the first thing I start with is understanding their vision and their strategy. But also, you know, are there areas within the business that really need to be shored up before we actually go out and combine company A and company B, you know, and that largely, and this has happened, you know, the financial function is not, you know, maybe it's understaffed or there's certain things about the finance function that isn't ready, you know, reporting what have you, you know, those are things that are hugely valuable and needed as part of growing through an acquisition.Ryan:So having a good accounting and finance team already in place, having good management controls good reporting, all of those things are super helpful and needed to, for me to jump off and go do my work and go find a company to buy and do all that stuff. The other places, you know, once you do locate a company and you have a conversation, you go under a letter of interest, there's a due diligence process on the target company, and a big chunk of the due diligence is financial. There's plenty of other stuff that goes into due diligence, but the financial piece is big. So having a strong accounting and finance team that has the capacity as well, so fully built out to not only continue to run, you know, the accounting and finance controls of the business ongoing, now they're asked to, to help with some due diligence process.Ryan:So you know, having folks that are strong both, you know, on the reporting, but also the finance side, the projections and understanding how to talk to capital is a huge component. And then the last part is, you know, now we've, we combine companies, the accounting and finance team, maybe there were combining departments, so now we have to create new processes, new procedures, new reporting, everything kind of has to get pulled into one. And again, I think, you know, having strong accounting finance function is probably one of the most important things you can have if your company is growing through an acquisition.Adam:So that really makes sense of where you've shown how the accounting and finance team kind of fit into that. But when you have the smaller organizations and you know, what you do in your organization, how do you kind of fit in the midst of all of the accounting and finance team, you know, their corporate development? Where do you fit into that as you're helping organizations?Ryan:So what I do with my clients is I come in as a fractional executive, and it's a fractional corporate development executive, if you wanna call it that. But I'm coming in as part of the management team to specifically drive the strategy and execution of their M & A strategy. I'm not coming in and, you know, doing accounting and finance, it's, that's not my role. I work closely with accounting and finance and there has to be a good partnership there. Of course, there's a large chunk of accounting and finance that I don't do, and it's just not, it's not my lane, if you will. So as a fractional executive, it's really important as I come in to understand everyone's roles and responsibilities, who's doing what. There is a little bit of a overlap with the work that I do initially with my clients, which is really more of a strategy and projection exercise.Ryan:It's a where are we going, how are we gonna get there, what's the projections look like? A lot of times that's being done by the CFO, sometimes I'm being asked to help the CFO prepare those projections. So if there's a capacity challenge with the existing team. So it's really a collaborative arrangement across not just accounting and finance, but all the other executives that are involved in management that are involved in my clients. It's a team based approach. And you know, there's a lot of the corporate development work that I'm doing that I think most accountants and CFOs don't wanna do. You know, it's building the corporate development plan, the target list, doing the outreach, you know, negotiating structures, you know, some of the real kind of heavy lifting on going out and finding companies to buy. So it's very complimentary and that's how I typically work with my clients.Adam:That's great. So something that came to mind as you were talking, how important are strong internal controls within our organization as you're going looking to do mergers and acquisitions? I know as you know, as IMA members know, internal controls are hugely important within an organization, but I can only imagine they can be even more important as you're going into a merger and acquisition.Ryan:Yeah, it's, it's imperative because as you and your, you know, listeners know that it is super valuable and it's a risk, it's a risk management thing of the business, and you don't have it, Right. You've got gaps, you're not, you know, there's a systemic risk to the organization. Yeah. And when I, as I come in and I look at that, if there's systemic risk of internal controls there, it doesn't make any sense to go out and find a company and put 'em together when there's that big of risk and holes to be filled. So a lot of times what I will do is as I start my process moving down the road of executing an M & A strategy, I'm working with leadership teams and management teams and financing and accounting, if there are risks such as internal controls that we need to shore it up before we actually transact.Ryan:And there's usually a long runway between when I engage with a client and we actually close on a deal. There can be up to, you know, 6, 9, 12 months sometimes before we actually get there. So we have time to shore up some of that stuff. And a lot of times, you know, even if we, let's say I work with a client, we don't find something to buy right away. Some of this work is still valuable. It's like, hey, let's shore this up to get ready for an acquisition, but this probably should already be done anyway. So it, you know, me coming in initially is, you know, some of my clients will say it's just a third set of eyes just to, you know, what kind of questions am I asking? And it can be valuable just to have an objective onlooker to make sure everything's, you know, being done and operating the way it the way it should be.Adam:Yeah. So regardless of the benefits, you need to make sure your house is in order before you can start looking basically.Ryan:Exactly. Exactly.Speaker 3:This has been Count Me in IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

In this special edition of Count Me In, Kelly Richmond Pope returns to help commemorate Global Ethics Day 2022. We discuss her latest IMA report, Ethics in the 21st Century: Management Accounting Practices for Robust Compliance Programs as well as her forthcoming new book, Fool Me Once: Scams, Stories, and Secrets from the Trillion-Dollar Fraud Industry.  In addition to her role as IMA Research Fellow for Corporate Governance and Ethics, Kelly is professor of forensic accounting at DePaul University as well as the award-winning documentary film maker behind All the Queen’s Horses, an in-depth look at the largest municipal fraud in U.S. history.   Ethics in the 21st Century: Management Accounting Practices for Robust Compliance Programs Fool Me Once: Scams, Stories, and Secrets from the Trillion-Dollar Fraud Industry Connect with KellyFull Episode Transcript:Adam:Welcome back to Count Me In, the podcast that takes you inside the impactful world of management accounting. This is Adam Larson, and today is a special edition of Count Me In to Celebrate Global Ethics Day 2022. And there's no better guess for such an occasion than Kelly Richmond Pope, IMA's Research Fellow for Corporate Governance and Ethics, professor of forensic accounting at DePaul University, award-winning filmmaker and the author of the forthcoming book, Fool Me Once: Scams Stories and Secrets from the Trillion Dollar Fraud Industry. Kelly and Neha discuss her latest IMA report focus on how management accountants are modernized in compliance in the 21st century. Plus we get a preview of her new book and lots of other updates. It's always interesting when Kelly stops by. So let's start the conversation.Neha:Welcome back to Count Me in. Kelly, it's such a pleasure to have you again on the show.Kelly:Thanks for having me back.Neha:First of all, congratulations on your new report, Ethics in the 21st century that came out recently.Kelly:Thank you.Neha:Our listeners would love to know what the report is all about.Kelly:The report is an overview of how to not only update the compliance function within your organization, but utilizing managerial accountants in those updates. So that's really what the gist of the report is, and we focus on three recommendations on how to update that.Neha:Wow, that sounds like a very helpful report for management accountants and finance and accounting professionals around the world. So I've went through the report and saw that you call designing an Effective Compliance program, both an art and a science. Can you help our listeners understand what you mean by that?Kelly:Well, you know, it's one of those jargon terms you use a lot and it sounds good when you use it, but now you've asked me a question about it. So let me tell you what I mean by that. I think that the science part is the fact that a lot of programs or organizations are siloed into departments, and so that's the scientific understanding of how we believe organizations should work. So you have your legal department, you have your accounting department, You may have your internal audit department, you may have operations, and all of these departments are siloed. And so I think that that's the science of how we organize companies. But the art is how to utilize all of those different departments together and finding the strengths of each of those groups and bringing them together. So they're one cohesive machine that works together, is the art part of it. And that takes some skill because we don't think about an approach of everyone working together. We think about a very siloed approach of how we work, and I think that when we are trying to update our, our compliance programs, we really need to look at these various silo departments and pull from those so that we can have this one cohesive teamNeha:That is very insightful and it might be a jargon, but thanks for helping us understand it better. Now of course, most companies try to have some sort of compliance program in place, right? What do you think is the biggest inhibitor when it comes to the effectiveness of these compliance programs?Kelly:Well, I think there's two inhibitors. One is compliance. The word compliance triggers people to think, all I need to do is check the box and just get this done. And the second is, most people believe that they don't need it. They believe that they're ethical. They believe that they don't need this type of reinforcement. So you have these two forces that you're battling. And quite honestly, most organizations do have very boring compliance training. And some of it is routine, but there is room for it to be more engaging and more dynamic. So I think the fact that we have conditioned people to think about this as, Oh goodness, here comes compliance again. Just let me get this done. And so we have a level set, a level shift that we need to make within our employee base to even get them excited about what we have around compliance. So you're fighting an uphill battle from the beginning. And so how, what, what can we infuse into compliance to really change that to get more people on board, is the big question.Neha:That's so true. Every time I've had conversations in companies, people think compliance training is going to be a snooze fest. So thanks for bringing that up. And can you help us understand how can companies avoid that kind of mentality or perception about compliance training?Kelly:Well, I think when compliance, there are some routine things about compliance, and that is true, but I think where you have the opportunity to be creative, you should be. And so my passion area, my research area is around fraud and forensic accounting. And I think that there are areas within the compliance training realm that can lend itself to more creative and more engaging types of approaches. And we tend to not do those. If we do that more, I think that we can change the attitude around compliance and make people more excited about it.Neha:Absolutely. Love that, Kelly. Let me pivot from that and ask you another question about whistle blowing. Now, how can companies incentivize internal reporting? So employees feel empowered to speak up when they see any misconduct?Kelly:You know, whistle blowing is an interesting topic because again, you have this same uphill battle that you're fighting. And a couple years back, I did a TED Talk entitled how whistleblowers shape history. And one of my motivations around doing the talk, because the whole idea around TED is do you have an idea worth sharing? And so my motivation around doing the talk was because whistleblowers are so valuable to organizations and to society, but how can we encourage more people to come forward when it has such a negative stigma? So I think one of the things that we need to do within our organizations is first remove the stigma and almost celebrate it. And it's, it's hard because despite the benefits that whistle blowers offer us, we tend to not trust them when they come forward. We tend to be skeptical of them, and we then tend to shun them.Kelly:And so if that's the, if that's the negative connotation around the action, no one's gonna do it. So if an organization can switch that thinking, and maybe they have an e-newsletter where they're sharing monthly, quarterly, annually, the wins and the value that internal reporters, maybe we even call 'em a different name, but what they've offered to an organization, maybe that is one way that we can encourage people to come forward prizes, whether they're monetary or non monetary, in other words, incentivizing people for their actions always will, will warrant a different type of behavior. So I think that we have to embrace a new attitude around the types of actions that we want our our employees to, to display for us.Neha:And that sure is an idea worth sharing. Thanks for sharing that, Kelly. I was thinking about some, some of the things that I read in the report and I came across the term values-based compliance programs. Can you help me understand what that means?Kelly:Well, I think the, just using the exact terms, I think that what we have to do, and this is really how we get more buy in from people, from our employees, is we link our training to the values and the missions of our organization. And I think that's one of the ways that you can get more people championing this kind of work. I think that one of the problems is employees and I, you know, I'm an employee too, we often see a huge disconnect between what we're being asked to do and the mission of the organization. So if we can have more of a value based approach to compliance so we can show people the why even more as to why this is important and why we have to do it, I think again, you'll have more engagement, more buy-in, and hopefully even more retention.Neha:So true about the why, right? It brings all of it together. And you also talk about other things like gamification and storytelling in compliance training. That sounds really fascinating for a talent development professional like me. Can you tell us how that can be done?Kelly:Absolutely. I mean, just think about what if I said this to you, I wanna tell you a story about you automatically get excited because you know that I'm about to take you on a journey versus if I say, I'm gonna tell you the rules of driving, you're going to automatically say, oh goodness, she's about to go through some procedures and policies with me and it's gonna bore me out of my mind. So I think that when we use stories as our foundation, we engage people, The science around storytelling shows us that we see ourselves in the story that we're listening to, and that's why we have more connection to what we're listening to. So I think that when it lends itself appropriate, we should use scenarios, we should use stories, we should use cases when it's appropriate. The problem is, I think a lot of times with compliance, we end up just focusing on the rules and the procedures and we lose the human connection.Kelly:And I think what storytelling does is it brings back the human side of what we're trying to convey. You know, I just finished writing a book and it's a book about fraud. It's called Fool Me Once. And one of the things that I really focus on in the book is the human side of fraud. Not just the scheme, but there is often a reason why a person ends up where they're ending up. And so I like to bring the, the human side back to anything, any type of content that I'm training around. And I think with compliance training, there are great stories. I mean, just think about why, just talk about the rule when you can use a story that almost exemplifies a person that broke that rule. Not only is it more interesting, you are talking about the why it's important within your company, and then you're linking it back to the mission of, hopefully you're linking it back to the mission of your organization. So it's, it's a win, win, win for everyone. When I think you can ground your training into a storyNeha:That's very fascinating, Kelly, you, you write about the human side and when emotions get involved in learning, people do remember their, their stuff so much better. The learning is so much more sticky for them. And you mentioned your book Fool Me Once, would you like to tell us more about it?Kelly:Sure. I can talk all day about that. So Fool Me Once is the full title is Fool Me Once: Stories and Lessons Inside the Trillion Dollar Fraud Industry. And it's being published, it'll come out March, 2023 but you can preorder it now, but it's being published by Harvard Business Review Press. And one of the things that I talk about in the book is I use the journey of doing my documentary all the queens horses as really the through story throughout the book. So what I'm talking about is what I do, I use a story to really pull everyone in, everyone that I want to read it. And so as I was doing the book and as I've been interviewing white collar felons and whistle blowers throughout my career and victims of fraud, what I've noticed is why that I've had these different emotions around whistleblowers, victims of fraud and and perpetrators.Kelly:And so understanding their why is, is something that the book is all about. And so what I did is I came up with this fraud archetype of whistleblowers, perpetrators and prey. So I'll call 'em perps, prey, and whistle blowers. And so I argue that there are different types of perpetrators. There's intentional perpetrators, there are accidental perpetrators, and then there are righteous perpetrators. And that righteous perpetrator category might be a little controversial for a lot of people, but some people do things to truly help other people. That is true. And so my premise is that all perpetrators are not the same. And same with prey. Sometimes you can have two categories here, innocent bystanders and organizational targets. And so organizational targets deals with the company and innocent bystanders deals with the personal aspect of when people are preyed upon.Kelly:And then with whistleblowers, you still have these different categories of whistleblowers. You can be an accidental whistleblower, you can be a noble whistleblower, and you can be a vigilante whistleblower. And a lot of times when we think about snitches, rats, tattle tails, traitors, they're that vigilante whistleblower category. But we have these other categories too. So I break that down in the book to help people understand that you have these different emotions because some people get involved in a fraud scheme for varying reasons. It's not all the same, it's not all cookie cutter. And so I use my documentary experience as the through story because my documentary is about the largest municipal fraud in US history. And so I talk about my experiences filming that. And so the perpetrator in that story was an intentional perpetrator, and her crime was discovered by an accidental whistleblower. And the, the victims of her crime were innocent bystanders. They were residents of a town called Dixon, Illinois. So I used my theory that I came up with to really help understand just the different descriptors that I offer in the book.Neha:It is a fascinating story. By the way, Kelly, I've watched it and I invite all the listeners here today to go check out All the Queen's Horses too. And I, for myself, cannot wait to get my hands on your book. It sounds like a page turner to me. Now this is my last question for the day. Our listeners who are mostly finance and accounting professionals, they're always looking to continue learning. Now, apart from you, are there any other experts in the field who our listeners can read and also follow on social media to get the latest and greatest in the field of compliance?Kelly:Absolutely. And in the report, we have two thought leaders. We have two sidebar interviews with two thought leaders that I highly recommend. Thomas Fox, who is one of the well known compliance leaders and Richard Bistrong. And so they're different because Richard and I'm not gonna spoil the stories you go after go read the report. But Richard has both have experience with compliance and fraud, but in different ways. And so those are two thought leaders that are both on LinkedIn and on Twitter. And I would highly recommend following them and reading their writings because I've learned a lot from those two compliance thought leaders through my experiences.Neha:Fantastic. Thank you for those recommendations. And that brings us to the end of our episode today. Thank you so much for a wonderful chat and sharing your insights with us today. Kelly,Kelly:You are so welcome and I look forward to coming back again.Outro:This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Dream ExchangeConnect with JoeFull Episode Transcript:Adam:Welcome back to Count Me In, the podcast that explores the ways management accountants drive business forward. I'm Adam Larson and my guest today is Joseph Cecala, CEO and co-founder of Dream Exchange, a company focused on building the next generation stock exchange designed for early stage growth companies. This is yet another podcast where I learned a ton, like how the rise of electronic stock training essentially shut down IPOs and equity stock market access for businesses worth less than $50 million. What's more, I learned how management accountants will play a critical role in making these new venture markets actually work. Whether you work at a small business, are interested in investing in small business, or wants to know more about the relationship between equity markets and innovation, this is the podcast for you. Let's get started with Joe Cecala.Adam:So Joe, I wanna thank you so much for coming on the podcast today. We're really excited to get talking to you about the Dream Exchange, but before we get there, I just wanted to hear a little bit about your story. I was reading your bio and I just think you've got a really great story starting off as a CPA and to where you are now. Let's start with your story and go there.Joe:Sure. And Adam, thanks for having me. I my story I like to say I Forrest Gumped my way through my career, right, I started as a CPA went to law school and became a shingle lawyer doing a lot of small business venture capital transactions. And you know, my accounting career really informed that quite well. I guess the big story of how we're here today is one of my clients, Jerry Putnam, founded a company which became Archipelago, actually the world knows today as New York Stock Exchange, Archipelago in the mid 1990s. It was the first company to actually carry equity security trades using the internet or among the first two. And I got this national market expertise when that was being born. And here we are 26 years later with a lot of legal expertise in capital markets.Joe:So several years ago I just decided that a new exchange model was needed to accommodate smaller companies. And we worked on legislation for that. It's still pending in Congress and we're actually building a national exchange as well. So everything that we're doing is born out of those early years of learning what a stock exchange is and does and how one is born, and the mechanics of that and adding the kind of practical business of how to run one to the legal expertise of how to create one. And really the other, I guess the other major portion of what we're doing that's different is that, you know, we're targeting what we call underserved markets. The entrepreneurial market, very small companies that don't really see interest from a stock exchange in the earlier stages of their business life cycle. And we're also especially concentrating in minority markets.Joe:The capital group that is financing the exchange and is the majority owner, our minorities, it's a black owned exchange, the first one in the history of the United States. So, you know, and we're in the licensing, we're in the process, we'll be hopefully licensed in about a year. So we're in that process right now, but things are going really well. And that's how I got here, was really starting as a financial professional and moving from financial professional to early stage company, venture capital lawyer. And so I really wanna help those small companies. It's more about the companies through my career I haven't helped or can't get access to capital than it is about the unicorn companies that have an easy time. So that's how we got here today. And hopefully the journey will be easier go in the next six years than it has been for the past 10.Adam:I sure hope so.Joe:Yeah, me too. So, and then I guess what I would say is the Dream Exchange today as it exists, as it perhaps might inform you know, the audience for this particular, you know, group. We're really concentrating on what are now gonna be known as early stage growth companies. That's actually a coined expression. It is in the Main Street Growth Act. And what that means is those are companies that are very small. They might have a valuation of, you know, 10 or $20 million, but they're gonna be seeking capital you know, for 10 or $20 million. And we're providing the mechanics of a brand new stock exchange environment for those early stage companies to be traded with customized rules and customized reporting and customized attention that the national exchanges really can't provide because the financial reporting and the cost of the coming public and Sarbanes Oxley and DOD Frank and the regulatory environment for very large companies is much easier to absorb the expense of doing that. But how do we maintain the same quality in investor protection in a small market while simultaneously making the cost less so that those smaller companies could get access to capital in a public market that's really the driver behind the meat and potatoes of the Dream Exchange.Adam:Wow, that's, there's so much there that I think we're gonna have to unpack a little bit of it. And I know that for me and I know a lot of other folks, you know, maybe we can start with, you know, how do you set up an exchange and what exactly is in exchange? Because we all hear about the stock exchange and stocks being there, but maybe there's a way that you can describe it for us that even a seven year old could understand it.Joe:Yeah, that actually, and thank you for asking that because that is, it really is not commonly talked about. Most people talk about the functions of an exchange without actually knowing what it is. So a stock exchange is merely a set of rules by which the buying and the selling of equity securities is conducting. That's all it is. And today those rules are primarily driven by electronics. So trading rules, what type of order, what type of sale, what the rules say about how the market participants have to conduct themselves fairly. Now, most people think stock exchange and what they're actually thinking about is what's called the secondary market, because you, the stock is already a public company and you wanna go and you wanna buy your shares of IBM and you have to go through a stock broker, some very large organization that is carrying trades to a stock exchange.Joe:Stock exchange is matching the trades that the order book and the matching engine of an exchange literally matches trades today in millionths and billionths of a second. And that's what people think. They see the Dow Jones averages and they see the New York Stock Exchange you know, set of listing is up or down. The function of the stock exchange is to match trades in a fair and equitable environment. Now, the other function that most people are, are familiar with is the initial public offering market, the IPO market. And they look at exchanges and go, they went public on NASDAQ, or they went public on NYSE. That's the capital formation part of exchanges. Now that's another kind of misinformed use of stock exchange because stock exchanges don't actually take anybody public. Investment banks do. So the investment bank has to make an arrangement so that when a company files publicly and sends its registration of its shares to the SEC, they can also take a registered share of stock to a stock exchange and apply to be listed on the exchange.Joe:Merely getting registered shares with the SEC does not automatically entitle you to a listing candidacy on a stock exchange. So stock exchanges are the final, I guess, line of governance between the general investing public and registration at the SEC. So you can be a not so good public company and get a registered share of stock and still not be eligible to have your company in the marketplace. So it's the stock market and that's where everybody's going to choose from the menu of available stocks that have been vetted by the NASDAQ or by New York Stock Exchange. And once you've been vetted by one of the larger exchanges, well, clearly the value of the stock is higher because you can go to a market and match your trade with somebody. Whereas if you're just an over the counter stock registered with the SEC, it's really like an exercise in digging in the yard for the bone because those are, there are about 10,000 over the counter stocks just nobody knows about them.Joe:But the public stocks listed on stock exchange are the celebrity companies. They do have secure environments where they're checked by the exchanges for the veracity of their financial reporting and you can get in trouble with an exchange too, if you're a public company listed and you don't play by the rules. So a stock exchange environment is extraordinarily valuable to capital formation, is eligibility to get to the exchange, makes a marketplace where the trustworthiness of the information of the company and the liquidity that would come from both the initial offering and a secondary trading of the stock, because you're going to the market. It's like if you're shopping for tomatoes and you're walking around fields of farms, you're gonna have a tough time finding tomatoes. But if you go to the grocery store, if you go to the market, they're gonna have already vetted the tomato grower, and they're gonna have looked at it all, and it's gonna be a quality of product that you get at the marketplace that you can't get just walking through farmer's fields. Same thing with stock exchanges. So those are, there's a lot of companies out there, but the vetting process and the trustworthiness of being able to come and list on a stock exchange adds value to the company's capital formation. And it adds liquidity after it's been formed. Cause people will buy and sell your stock.Adam:I think I'm beginning to understand a little bit as we go along here, which is great, but as you were talking about that, and then as I was hearing you speak a little bit about the Dream Exchange, when during your first answer, it seems like the Dream Exchange is there for those non unicorns, those smaller companies who may not have as big of capital but still want to be exchanged and wanna make money on it. Right?Joe:Yeah, that's exactly the purpose. So we did a lot of research. I'm a data guy, and you know, and I have to take a little responsibility for this because in the late 1990s when electronic stock trading became the norm stock exchange's business model and investment bank's business model was driven by whether the company that was coming to the exchange would have a lot of volume, because now you're talking about millions and millions of trades happening in a very electronic short period of time. So the business model for making money doing that is now driven by high speed electronics. And there was a unwanted side effect, and that was that very small companies don't generate a lot of trading volume. So investment banks and exchanges tended to not pay attention to those companies. And at one time, $50 million was the more than the average public offering, initial public offering.Joe:So if you could be at $50 million, there were between, you know, some of yours as little as 300, some of yours as high as $950 million in under public offerings. And since 2000, we haven't had as many 50 million and under public offerings in 22 years as we had in any one year before the year 2000. So the combined number of small companies going public for 22 years does not eclipse the small public offerings in any one year before that. And the primary cause there are other causes, but the primary cause is this shift in the business model, there's just, you can, for a billion dollar IPO, you'll generate more trading volume in seven days than you will for a $50 million IPO over the course of an entire year.Adam:Wow.Joe:So if you're, if you're in the business of making money when transactions conclude, you have no interest in that market. So that unintended consequences, public market capital formation for small companies really was no longer workable. And so the Dream Exchange idea, which is encapsulated in the Main Street Growth Act, which is to create a brand new type of stock exchange called a venture exchange. And in those exchanges, we can now customize rules that will allow very small companies to maintain the trustworthiness of the public markets, but also have access as they did for many, many years, decades, in fact, before the advent of high speed electronic trading. And we believe that the importance of that is, it's just, there's a myriad of reasons. First and foremost is that the best ideas come from these very small companies in their earliest stage. And wealth creation comes from those very small public companies.Joe:And I mean, I'm a child of the seventies and the eighties. So it was commonplace, Hey, can you get in early on a new IPO? Did you hear about the new IPO? And a lot of people invested their dollars and saw wealth creation because they got in early. Well, today that early public market isn't really available to the broad American investing public. So you're at the very tail end, you're at the end of the life cycle where a company's already worth a billion or 2 billion or $5 billion and the wealth has been harvested in the private markets. Well, the problem with that is we're only getting, you know, 200 total IPOs a year where we would have 800. So it's not that the companies aren't there, it's not that there isn't valuable ideas, it's just that the access to the public capital markets generally is not available.Joe:And that's not to say that private investing and venture capital investing aren't doing a great job. They are. The difference is they can't do it all. And to make customized rules to kind of be a throwback to allow for wealth creation, investor participation, and early stage company participation has to have a overall capital market change in the model. So the Main Street Growth Act has provisions in it creates a brand new type of securities, it's called Venture Securities. And it, there's a new type of company called an early stage growth company. I'm very proud of the fact that that's one of my contributions to that law. I coined that expression.Adam:And this act is an act that's currently in front of the US Congress. I just want to clarify for the audience.Joe:Yeah. So actually in just a one minute kind of Main Street Growth Act history. So this is a law that was introduced in 2000, well, originally in 2016, then again in 2018 and in the 2018 Congress, this is a law that got, and we lobbied heavily for this unanimous consent first of the House Financial Services Committee, 56 to zero. And I don't know, I mean, I pay attention to some of the news, but trying to get the two parties in Congress to unanimously agree to anything is like trying to get them to agree that water is wet. They just won't agree. But this was one where the capital markets and wealth creation and the ability to serve constituents and job creation was something that became so apparent to Congress. It actually passed unanimously through the House and the Senate. The only reason we're talking about it as a prospective law today is if you recall at the end of 2018, the government was shut down and any legislation that would've passed that year and this would've passed was taken out. And then we've been waiting ever since. It's now moving again. So the bill is again, in the House of Representatives and in the Senate, it's in Jobs Act 4.0. There's very good possibility that'll pass this year. And these new exchanges is an industry that doesn't exist today. It will be born in the coming years. And there's gonna be a tremendous amount of opportunity for people who learn about it in its infancy.Adam:It sounds like we're, we're bringing this exchange and the idea of getting your organization out there at an IPO. And I'm probably using the wrong terms, but it seems like we're bringing diversity actually into this, this market because I feel like there's only a certain amount of people who are making a lot of money on the other exchanges, but this is like, hey, everybody can kind of do this.Joe:Yeah. You're not using any incorrect terms. Okay. The fact is that, in fact, this is both sides of the political aisle have have said this to us. They look at it as the democratization of capital markets where anyone with a good idea and that is willing to comply with the rules can go to the capital markets and appeal to the American investing public to invest in their idea in a secure public stock exchange environment. And again, we're not against anyone, but for example, like proud regulation crowd funding was passed and people say, Oh, I'm gonna go crowdfund my investment. Well, when you do that and you raise as much as 5 million as the cap, you raise $5 million crowdfund, you now own a private security and it can't be resold. The 1933 Securities Act starts off very hopelessly. It says you may not use interstate commerce to sell securities, period, full stop.Joe:So how is it done? There's only two ways it's done. Either you register the shares publicly to sell them, or you find an exemption, one of about 18, by which you can resell your shares. Well, that's a very complicated legal process, and you better have a good Rolodex of investors because you still can't solicit the entire general public. You own a private share, you're stuck with it. Well, when you're in a stock exchange environment, you don't even know who's buying your shares, you go to that environment and other people look at the same information about your company, and they're able to make an informed investment decision, and you can sell your shares for any reason or no reason at all. And as long as they're complying with the law, there's a secondary market where those shares become liquid. And that's the concentration for small companies that's really needed today.Joe:And it was 50 years of our country's stock exchange history where the small company, 50 million and under normalized, and it was a lot of tens and twenties and thirties that comprise that market. And it's all but disappeared. And we intend to be the pioneers reintroducing that to a secure environment so small companies can go get the capital they need to expand and to run their operations and grow and to become the public company. The, you know, the unicorn before it's identified as a unicorn starts somewhere. And that's what we're concentrating.Adam:Do you think people will start at the Dream and then go to the other ones as they get bigger?Joe:That's exactly we call it the ecosystem.Joe:So the ecosystem is first and foremost an educational environment doing somewhat of what we're doing right here, helping to get the terminology in simple terms out into the public. That's the first part of the ecosystem. What are my options? Then there'll be a lot of companies that arrive at the Dream Exchange in its venture exchange. We're also creating a national exchange, and the goal is to get the venture exchange listed companies to graduate to the National Exchange. And to restore the ecosystem, because this isn't just small companies. So at one time we had close to 13,000 public companies in the United States, and right now we have about, we have half of that total and really only about 3,500 listed companies of any meaningful note. So we've reduced the number of overall public companies by 75%. So the investment choices are much, much smaller. So the ecosystem is broken down. We're not repopulating new companies with new ideas into the capital markets. So we're losing ideas. And this is the most important part of everything, and I'll take the time to say this because it's behind the purposes of everything we do.Joe:Ideas and the imagination of the American business spirit has been what's made the country powerful and great. There was a guy recently who said, you know, we won the Cold War by using Coca-Cola and rock and roll. The Soviet Union collapsed because they just couldn't withstand the wave of popularity of American culture and our small companies they're cool, they have great ideas. They have medical technologies, biopharma technologies, manufacturing technologies, you know, and those are, I'm calling it technologies, but you know, the Midwest manufacturing base has, we think about 7,000 eligible companies in the southeast corner of Wisconsin for the Dream Exchange.Adam:Wow.Joe:So the, there's a vast number of small companies and the mechanics and the pragmatic nature of those operations, making milestones for their ideas, we have to get them money or we dry up the source of capital and the ideas that we would've been investing in no longer are part of the fabric of the American business culture. So we're not creating the new Apple computer. It's only being created if by chance they meet the right venture capitalist and they get introduced to the large VC or private equity group that can carry their idea forward. What about the 10 guys who may have had a better idea and just couldn't have the Rolodex or relationships to properly capitalize their company and move forward? So the Dream Exchange is intended to create a broader audience so that more ideas, more good ideas help us survive as a country financially.Adam:Wow. I mean, I hope everybody's been learning as much as I have as you've been talking through this, but, you know, we have to bring it back the conversation back to the accounting and finance professional. And this will probably be, you know, we'll probably wrap up a conversation here. How is this gonna affect, you know, the CMA the certified management accountant who is, you know, is out there trying to be the best CFO or, you know, be the best data analyst, you know, how is this gonna affect the accounting and finance professional as this comes live?Joe:I've been teasing about this for years. I've dubbed the Main Street Growth Act, the Accountants Full Employment Act. The fact is with the approach that we have, a lot of small companies are primarily focused on internal financial reporting management reporting for purposes of making milestones, making sure the business is functioning properly, and then tax reporting. And what we're doing is elevating the importance of that information in the small capital market. Because a lot of these companies, they're gonna start out with, they don't have you know, financial accounting professionals. They don't have a full department of external reporting professionals. They have their internal accounting. So there's gonna be a bridging of the gap between internal and external of these small companies where we're creating minimum reporting requirements that are really gonna be the labor of the management account.Joe:They're gonna be the labor of the existing accounting staff to understand how to bridge the gap between the milestone reporting. You know, do we have enough inventory to make the next milestone have we calculated its pricing, You know you know, LIFO or FIFO to make sure that we get there. Right? So this is far more important to the small company in the small public company environment than whether or not they did accrual accounting for estimations for whether or not they had you know, an arbitrage of an oil and gas contractor, an insurance rep. Who cares? These are, these are pragmatic accounting decisions that need to be reported, because that's what the small company investment revolves around. Will they make their milestones, will management make it, And if they do, how big can the growth of that small organization be? Because if I invest today a dollar, I wanna get a dollar 10 or 20 or $2 back.Joe:No one invests a dollar to get 99 cents back. And in the small environment, whether the company has good data, whether that data is proving that they're on a pathway to success becomes the job of the internal accounting function. And we're creating customized reporting so that those internal accounting functions can become easily and seamlessly part of the financial reporting for the small company that will come to the Dream Exchange to be listed as a venture company. So it's Virgin territory today. This is an industry that doesn't even exist. And the more we, we'll probably be holding some symposiums in the next year to talk to the very audience that's on this podcast because we want to get feedback about the ease with which we can make the reporting requirements inexpensive. So that's the other factor, which is, you know, Sarbanes Oxley, Dodd-Frank you know, 1934 securities filings those types of filings are geared towards a lot of financial accounting and financial reporting requirements for which we'll have.Joe:But the bridging of the gap is gonna really be that accountant sitting in the chair that's really running the show today, we wanna add to the reporting without adding to the burden of expense and time. And there will be added staff eventually, but it'll be worth it because if you can get to a public capital market, adding another one or two staff to make sure you're doing all the compliance will be worth it for that small company. The added expense versus getting millions of dollars of public capital clearly makes the expansion of some of this reporting worth it. And we don't wanna go too far past it. So weighing the accountants who will weigh in on this will be the ones that are doing the job today. What requirements are necessary, what requirements are, you know, kind of there for show. So we're much more pragmatic. We only want the ones that are necessary. So that's from their belly button looking at this situation that is the expansion of employment and responsibility if they wanna learn this new market. And I think it's very valuable to learn it. There are thousands of companies who are going to need that service and need it internally. They're gonna be hiring people internally to do it.Adam:Well, Joe, thank you so much for your explanation and for coming on the podcast today. We will put links in the show notes so you, you guys can want to get in contact with Joe. Please do so and you wanna know more information go to the Dream X website. Thank you again, Joe for coming on.Joe:Thanks so much for having me out.Outro:This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Links mentioned in today's Podcast:https://www.thecareertoolkitbook.comhttps://www.cognoscomedia.com/brain-bumphttps://www.thecareertoolkitbook.com/resources Connect with Mark:https://www.linkedin.com/in/hershey/https://twitter.com/CareerToolkitBkhttps://www.facebook.com/TheCareerToolkitBookhttps://www.instagram.com/thecareertoolkit/Full Episode Transcript:Adam:Welcome back to Count Me In, the podcast focused on the issues, challenges, and characters shaping the management accounting profession. I'm Adam Larson. Today I'm joined by Mark Herschberg, serial entrepreneur, business innovator, and the author of the Career Toolkit: Essential Skills for Success that No One Taught You. Now, lots of people cover career and work best practices, but if you ask me, it all can start to sound pretty similar, but that's not the case with Mark. There's a good reason he teaches at MIT, which you're about to find out. In fact, Mark had so much insight and advice to share from his research and years of building companies and teams, we ended up recording two podcasts, the second of which will be coming out soon. But for now, let's get started with Mark Herschberg discussing the fallout from the great resignation and what he's learned about how to fix work.Adam:Mark, I wanted to just thank you so much for coming on the podcast today and today we're gonna really focus on the great resignation and we've all been hearing this term they've been writing about it since it started in 2021, but I wanted to start off by just you talking a little bit about what what it is and what it means for everybody today.Mark:Well, thanks for having me on the show today. The great resignation is really the term that is an umbrella term for what is the largest rewrite of the capital labor contract that we have seen in a century. Now certainly we are seeing people leave jobs quitting, finding better jobs, sometimes going back to their original job, but it's also a larger cultural change about what people are looking for in their jobs. And so we need to recognize this isn't just, well, we have to do a better job hiring or retaining. It is a shift in terms of what people want and companies need to adjust if they wanna stay competitive in the labor market.Adam:Yeah, it sounds like it, and it also sounds like companies really need to focus in on how do we keep employees as well? Because I'm sure during the pandemic employees were seeing, do I really still need to be here? And that they started asking themselves a lot of questions.Mark:Well, that's a really good point. And you get different answers depending on who you ask. When it comes down to any job, it's really about the communication needed. It's about who needs to communicate with whom and when and how best to do that. It's why we have emails, slack, phone calls, meetings, they're all channels of communicating, whether it's project updates or you and I coordinating and coming up with ideas. That's what a lot of work is. What we found is that certain types of work can be done from home. We don't have to be sitting next to each other. And people have speculated about this for years. I work in technology. We've certainly been on the forefront. I've been working with teams all around the world for years. You can do some of that, but there are limitations to that and it seems like we might be overshooting a bit in that people don't understand. At first we said No, you'll have to be in the office five days a week. It's like, well, we know we can work when we're in the office zero days a week. You can work in both modes, but is that optimal? And so there are different facets you need to look at to decide what is the optimal number of days for a particular team at which points.Adam:Yeah, and it also seems like it's more than just money that people are leaving because of a lot of times people leave because of money or because of culture, or all those things. But you can't just throw more money at your employees and say, Okay, you know, stay here.Mark:That's exactly right. Money is a bit of a factor. And as we record this at the start of the summer in 2022, we've been coming off some of the highest inflation rates that we've seen in a generation. And so you do need more money to stay competitive and other companies are throwing money at them. But here's the thing, you are probably not the highest payer in your market. One company is, and it probably isn't you. So if you're just competing on money, that's going to be a problem. What we saw is people are responding to these other dimensions, and this is what I meant when I said it's a rewrite of that capital labor contract. It's no longer I pay you money, you do the work. And so we're seeing employees, particularly younger employees, but we are seeing it across the spectrum. They're looking not just at money I'm using at Compensation General, or there's stock options of salary, but also work life balance, company culture, alignment to mission and support, just to name a few.Mark:We saw companies that back at the start of the pandemic in 2020, some of them said, look, it's tough for everyone. Suck it up and do it. And other companies said, hey, it's tough for everyone, so we're going to give you Fridays off for the next two months because this is crazy. Spend some time with your families. We all need the stress break or what can we do to support you while you are at home? And so the companies that were more supportive of their employees were the ones who basically had more loyalty and had employees say, I know you're looking out for me and are more likely to stay. So it's important that we really sell our employees current and future ones, not just on the compensation, but on all these other facets.Adam:So it what I'm hearing you say, it sounds like company culture is a huge part of avoiding the resignation, but also, you know, when you, when new people are coming on, you wanna make sure that they fit that company culture to make sure that they're gonna stay on.Mark:Culture is very important. Now by culture, I think a lot of companies get this wrong. They think the culture is the seven values. Someone in marketing put on the website that says customer first or whatever the mantra is. And I'm sure there is value to those, but the actual culture of your team might be at your company level. More likely it's at a team or department level is how you interact day to day. For example, I have a colleague who told me at a former company, the rule was whoever yelled loudest got their way in the meeting. I guarantee you marketing did not put that on the website. But when you show up, that's how you have to behave. And if you're not the type of person who likes to yell and shout at a meeting, you're not going to be effective in that company.Mark:Now that's an extreme example and most people aren't saying, Okay, yeah, let's put yelling as a team value. But it is values such as are you expected to answer an email at 11 at night at some companies? Yes you are. Some people are okay with that because you're paying me enough money. And I don't mind. Other companies say, no, we really don't expect you outside of work unless there's an emergency. It's things like how often you are expected to be in work. It's how much support they're going to give you. There are companies who say, we're here, we're gonna help you with your career. We're going to help you plan out where you're going, we're going to develop you. Other companies say, well, you're here because we're paying you and if you wanna be somewhere else or do some other job, well that doesn't help me, your boss, so why would I help you? And those are very different cultures. So you really wanna look at that almost tactical group-level culture in terms of how you operate the relationships, the trust, and the understanding with other people on your team.Adam:So we've been talking about like company cultures and how can best help it, but I can't help but think what if I'm somebody who left my company during the great resignation and I'm thinking, you know what? What should I be looking for? What questions maybe I should ask when I'm going into an interview, trying my next job that I want to avoid the culture I was just at and I wanna make sure that I'm going to the right culture going forward?Mark:That's a great question. There are a number of categories of questions you want to ask. So let's look at a few of those. You want to ask about the culture, for example. And you can ask questions like, what three words would you use to describe the company culture here? What traits do you value in team members? What personality types are a good fit for the company? These type of questions are open-ended, there's no right or wrong answer, but it can help you explore what's important, what those values are. You can ask about management, ask to your potential new boss, what's your management style or approach? Obviously ask that of the subordinates as well because they might have a different perspective. How does the team resolve conflicts? Tell me about your feedback process. What was the biggest conflict that the team faced and how did they get through it?Mark:You can ask about the job itself. What type of onboarding support do you have? What would make someone successful in this road? Excuse me, what would make someone successful in this role? Where will this job take me down the road? You can ask about engagement. How do you help grow your employees? What type of support does HR provide? You can ask general questions. What's the best thing about working at this company? What's the one thing you'd like to change about this company? How long do people tend to stay at this company? So there's lots of different questions. And again, these are not right or wrong answer questions. They're questions that give you insight into the company. Now, two important things when you bring this up during the interview process, because it doesn't often come up. And these questions, by the way, are important to both sides.Mark:We're looking for a fit, a mutual fit. If you think about dating, it's kinda like asking the question, do you want kids? There's no right or wrong answer, but if someone says, I want kids, and someone says, I don't, right there, you know, you two are not compatible and that's fine. No hard feelings. This is not good relationship. So same thing here. These are not horrible things and there's no wrong answer, but you're looking, is there a fit on both sides? So both the hiring team and the candidate are interested in answering these questions and either side can choose to bring this up. Now, if you're the candidate, probably you're going to need to bring this up when you do so, obviously be respectful. You don't want to ask in an aggressive tone, in a challenging tone, you want to ask with a polite, respectful tone.Mark:The other thing, it can still be a little awkward to bring this up. So in the articles I've written about this, here's what I say, blame me. You can say, listen, I heard this podcast, there was a guy named Mark Herschberg and he said we should go through these questions together. So I'd like to bring them up now because now you are not being annoying and doing something a little unusual. Many companies aren't used to getting these questions. Instead you're saying, this is a recommended best practice I have heard of. And if they challenge it, if they say, Oh, that's stupid. Well yeah, Mark Herschberg looks stupid, you don't look stupid. You can, you can dodge that blame. So it's gonna give you some protection and cover. So feel free to do that if you'd like. But you definitely at some point want to bring up these questions and explore it. Otherwise, it's like going into that marriage without asking questions like, do you want kids? And where do you wanna live? You're probably going in blind and asking for trouble.Adam:That sounds like it. And we'll make sure we put a link to that article in the show notes so that everybody can take a look at that. So I, you know, I think those are, that's wonderful advice and I wish I'd had that advice many years ago, the different interviews that I've been on, I would've loved to ask those questions. Are there red flags that people should be on the lookout for it? Cause obviously when you're listening to those things, you know what you don't wanna see in a company. You know what you're looking for, you know what you've been through. But are there certain red flags that if somebody answers one of those questions this way, run?Mark:Certainly I'd say the yelling is red flag, at least for me. Although then again, I hear stories about at least the old days in Wall Street where yelling and screaming and people throwing things, that's par for the course and certain people were attracted to that type of super aggressive culture. It's really about what's a fit for you. Let's just take something simple, asking a question like how many hours a week do you spend in meetings? It's a question we don't ask. Now, there are many people who say, I hate meetings, I know I have to do a few of them. Okay, four hours a week in meetings, no problem. If they hear 20 hours a week in meetings, oh my god, that can be soul crushing. Probably not a fit for you. There are other people who actually love meetings and hey, 20 hours a week, bring it on. It's funny, we ask that with travel, that's a common question, What percentage of time is spent traveling? That's an acceptable question. But we never ask how much time in meetings or filling out paperwork depending on the nature of the role. So it's really important to break down the different aspects and just find a fit. I don't think there's any universal red flags for the most part, but it's about what's right for you.Adam:So you almost have to know your why and what you're looking for to be able to know what red flags you're looking for, in a sense.Mark:It goes back to that dating analogy. If someone says, my idea of fun is camping and someone else says, my idea is dressing up and going to the opera, they're both valid answers, but they're probably not compatible.Adam:So as we circle the conversation back to companies, how better can companies maybe engage their employees or get them involved so that they can avoid this in the future?Mark:There is a very simple tool that you can use that's gonna provide a number of benefits, including upskilling and engagement. Now, this is based on the 20 years of teaching that I've done at MIT, using techniques we use there as well as the technique used at top business schools. What you want to do is create peer learning groups. It's similar to ERGs, but it's not based around some designation. It's not what you happen to be, it's about what you're trying to achieve. So you can create general groups or you can create groups around specific skills and what you wanna do with these groups. I recommend groups of about six to eight people in size, but you can make them larger or smaller or go whatever way works for your team. And in these groups, which by the way can be done in person or remote or both, you want to focus on particular skills.Mark:Now, I particularly recommend some of what we call softer skills, leadership, communication, teamwork, negotiating. Those are skills we don't focus on as much. But you can also focus on more technical skills, particularly accounting skills or tool skills. And what you wanna do in these groups is have folks come together, engage them with some content, have them read a book or some articles, watch a video online, use a great podcast like this one because when they engage with the content and then go and have that discussion, that's where you get the richness. You're gonna listen to this podcast and you hear, oh yeah, important things, great resignation. We have to think differently about how employees want to work with their companies. That's a start, but it's not the end of the conversation. And in having these small conversations, you start to go deeper into what these ideas are and what might work.Mark:Same thing with leadership. I can give you, here's three tips for leadership, but it's not so cut and dry. It's not as simple as here's how to declare this asset on a balance sheet. It's very black and white. Leadership is not. And so it's understanding those subtleties and that's what happens in these groups. Now, if you do it, you're going to get four advantages. First, you are upskilling your employees, that's fantastic, you get better employees. Second, you're going to better engage your employees. You're saying, we're not just here to get work out of you. We care about developing you, we care about helping you. And it's no longer just compensating you with money, as we talked about before. They want to see this type of support. Third, you're increasing your internal networks. Really important, especially as we're in a hybrid workplace that we really focus on spending more time getting to know each other and relating to each other and building those internal relationships.Mark:And fourth, you're creating a common language because if, for example, you pick the book, like you have the name if for example, you pick the book Good to Great, they talk about the hedgehog model. And if you use that book and everyone's read it, you can say, oh, well let's apply the hedgehog model. Everyone knows exactly what you're talking about. So you have common stories and patterns that you can more easily apply. So if you want to do this, there's a free download on my website under the resources page, the Career Toolkit development program. You can use my book for it if you want, but again, if you don't wanna use my book, use a different book, use other free content, and this is going to help engage and upskill your employees completely free.Adam:That's great. And we'll put a link to that in the show notes as well. I really feel like that engagement is one of the key factors of keeping your employees where they are, not necessarily where they are, but keeping your employees engaged in the company. They know the why, they're connected with their teammates, with people outside of their team. They can connect with the higher ups. It it's a way to kind of connect everybody because otherwise you, especially while we're all at home or we're doing hybrid models and all those other things, you feel disconnected so much from people and that really feels like a way that it brings people together in a way that we haven't seen, especially during the Covid era.Mark:It does because it puts you together in discussions that aren't just about the monthly report that you're so tired of talking about because you did last month and the month before that this engagement's also important because we are getting into hybrid workplaces. It means the onboarding, the time it takes for someone to get up to speed, not just on the technical aspects, but fitting into the team is often taking longer these days, which means our existing employees are even more valuable because they have the established relationships and networks and we really want to keep them so we don't lose those.Adam:So Mark, if people wanna know more about this, where can they get in touch with you?Mark:You can go to my website, the Career Toolkit book.com (https://www.thecareertoolkitbook.com), and there of course you can get in touch with me, learn more about the book I wrote, get the questions we mentioned or other free downloads on the resources page. All this is here to help you better engage and support your employees.Adam:So Mark, as we wrap up the conversation, I just have to ask, is the great resignation over?Mark:We have likely passed the peak, but there are going to be echoes for years to come and these echoes will come in different ways. Some of it will be as companies work on their work from home policy, a company may say, we want everyone back five days and they start losing employees. They say, Well, we better switched to three days. Or they might try three days, realize that doesn't work and switch to five days, then lose people in the future. So as we tweak policies in companies or industries, we're going to see echoes. We're also going to find that working very remotely and some companies have moved fully remote works in the short term, but there are long term implications. We know people can mechanically do their work from home. We've been doing that for two years. But what about those relationships that they're trying to build?Mark:What about the long term strategy? What about thinking beyond the tactical day-to-day work we do that may not be as easy at some companies when people are primarily remote. And so they're gonna find this isn't quite working and we have to change up, which again, are going to cause echoes down the road. Even things such as if you move to an island in the South Pacific and you do your work, you're getting it done. But if you're not showing up to the office in building relationships in your industry or in your company, that may hurt you in the future. We're even seeing potential DEI issues. And here's a really tricky one. We've heard people talk about if you don't set a standard policy, everyone has to do X days in the office. What happens is women and certain underrepresented groups tend to do more work at home.Mark:They have more home responsibilities. So if you make it flexible, they're in the office less, white males are in the office more. Well, who is more likely to get promoted? Now we have a DEI problem. On the other hand, if you say, Well, everyone needs to be in the office three days a week. I've heard the complaint. Well now people who have more home responsibilities say, I don't want three days a week. I want two days a week. Who leaves your company? It's again, women and underrepresented groups. Now you have a DEI problem again. So there's a lot of challenges and we don't know yet how they're going to play out. So I think we're going to continue to see some echoes of the great resignation for many years to come.Outro:This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Connect with OdedFull Episode Transcript:Neha:Welcome back to Count Me In, the podcast by and for management accountants. I'm Neha Lagoo Ratnakar from IMA, and today I'm speaking with Oded Zehavi about how the enormous potential of digital transformation is finally coming to fruition for CFOs and finance teams everywhere. As the CEO and founder of Mesh Payments, Oded has a bird's eye view into how accounting and finance professionals are utilizing and customizing powerful new software tools to streamline business partnering, sharpen internal controls and simplify business operations. And what struck me during the conversation was that how appropriate the word transformation is in this moment. It's like the buzzword I've heard a million times crystallized into something real for me. During the course of this interview, you'll hear how technology has clearly elevated the value the finance function is able to provide to the business in real time. Let's get started with Oded to see how businesses are leaning into this exciting new era of innovation.Neha:So let's start with the obvious question today. We are all witnessing a transformation in the way we work and finance and accounting is one of the functions that lends itself very well to remote working. How do you think the CFO's office has changed since the pandemic?Oded:So people usually speak a lot about the fact that everything is remote now, which is key, by the way, by the way that finance people operates. I will even go back in time and speak about something that less people are talking about, which is why the category, which I mean, which is spend management, have been really driving from the beginning of the pandemic. And in my mind it's always start by the fact that before the pandemic, the finance teams were really focusing about T&E. So everybody were a lot of fun. Various sales guys were traveling and it's all about how we collect received, how do we close the books? There was so much noise so many people involved. What does does it mean? And so many employees have been brought, and it's really beyond the fact that he's taken a lot of the time from the finance teams activities.Oded:It also created a lot of noise and camouflage some other problems that might have been bigger or different. And when the pandemic started, that was shut eliminated overnight. So now nobody travels anymore. No receipts have been chased. That noise have been gone quiet. Totally. And on top of it, there were two other trends which in my mind have really impact the way finance team operates. One, as you mentioned, is the fact that now companies are fully remote and distributed. So a lot of the processes that historically the finance team could have solved by telling the employees, you know, what? Come to my desk, yes, tomorrow and we'll make this happen have not been relevant anymore. And last, but not least, the fact that many of these companies move a lot of the infrastructure to the cloud. So now a lot of these old on premise licensing models have been shut down.Oded:And now everything move to more recurring models where you need to pay every month a much smaller amount with much more softwares. So the combination of all of that really made a huge difference when it comes to how finance teams need to treat spend or treat corporate spend. And what I'm seeing is that over the last two years, the space itself have been exploding. So many great companies have come into this space, which are now giving very new technology, amazing user experience will talk about it in the second, and last but not least, a new business model, which in our category, historically, companies have been used to pay for software that helps them control spend. I'm amazed there are still companies that are even considering paying for some of the very, very old legacy platforms on things they are not really using, where there are so many options like mesh in the space that enables them to pay only for what they use and sometimes not even pay anything because a lot of us have been using the model where we, the merchant that we are paying for are, are really paying for the service. So a lot of transformation and changes in the way finance team have looked at spend management and on top of it and you started by the remote and the fact that companies are now distributed. So it's not only that are distributed, they're also global. If we were talking, having this conversation few years ago, most of the US companies were usually around this very one site usually in one city in the US it could be San Francisco or New York or one of these leading countries.Oded:The pandemic really shifted a lot of the employees all across the US and now there are new places where employees from different reasons want to spend time in like Austin, like Miami, like all these places which are totally outside of the where traditional headquarters have been based and last than not least, why stay in Austin when you can spend the same time and work from a much more exotic place. And I've seen companies that have become fully distributed and fully remote. And for the finance teams, all of these challenges are really something that is transformational. And they have really invested a lot of time and effort in the last two years to be ready to give solutions or be, give service in such a changing world.Neha:Wow. I love that, Oded, there's so much that has been happening, and thank you for summarizing so well how work, softwares, platforms, our activities have changed in the last couple of years. Now let's talk about the mindset changes. What have you seen change in the last couple of years and is there anything that the CFOs or the finance departments can do to help with this mindset change?Oded:So it's interesting that we are talking today, which is more or less in the middle or the beginning or some people out the hand of additional neutrons to change in the mindset of finance team or finance people, if we can go back when the pandemic came, everybody stopped and tried to reduce cost and see what happens that very quickly after a month or two, the world, especially the high tech scene, have really shifted into growth. Just growth and growth and growth. And companies have been growing and bringing more to employees. They're more talents and spending more on media. And it was really about growth. Not all, but most of the companies didn't invest enough time about unique economics and controls and things that are fundamental when it comes to business. And we are in the beginning of a new transformation or new mindset change where everybody said saying to the same fine sense things that they will say to them a year ago, Grow, grow, grow, stop, stop, stop.Oded:And let's focus on the fundamental economics control and visibility. And it all comes back to the fact that now changes are happening much quicker, but then nobody knows if we'll talk again in two months, what will be the mindset then, that it will be just control, and it might happen the same way it was in the pandemic. The only thing that we know that is that we don't really know. From what the impact for finance teams is that they now need to have an infrastructure, which is usually based on technology automation that enables them to change the way they operate and based on this changing mindset. So they need one day to have tools that will enable them to spend more and get more employees empowered to spend and to do more projects.Oded:And one day they need to say, take the same employees and make sure they have have full visibility of what, how they spend. They can in one click start canceling some of these services that they've just asked them to order. And the only way to do that in the pace that is expected now by the industry is to have tools and technology to help you. So in one way, you might say that the change in mindset really prevent from finance teams to act and really make them focus on other projects from the other end. The great finance team, so the ones that are going to be fully successful are the one that knew how to balance between following the trends and in parallel building the infrastructure that will enable them quickly to be adapting themselves, adapt themselves to the changing trends, which that's what what really makes great finance teams shine.Neha:Wow. I love that, Oded. And you touched upon a great topic there about speed and transparency for finance departments. Are there any trends that you noticed or what can finance teams do to improve this speed and transparency?Oded:So historically when a lot of the finance operation was based on paper and receipts and invoices and manual processes, the ability to get enough visibility and enough control was very tough. Now, and going back to the pandemic, which have digitized them, a lot of the processes when it comes to payment, when it comes to ordering, when it comes to having data sources that can expose to you trends that are happening outside of your organization, that's really enables you to try to reach a situation where everything is automated and based on data. So you don't need to, going back to the example of pre-pandemic in some of the old systems, usually finance team have seen the transaction of the person who is traveling only two days after he actually done the transaction. Today with the new systems, it's all in real time.Oded:The minute you spend, you book your hotel, regardless where you are in the world, the finance team automatically get visibility to what's going on. They can even create a control, by the way, can even create a process that they will preapproved that payments. Because with the systems that are exist today, that's something that can happens in real time. So it's the fact that now everything is in real time, that there is data sources that can help you really make wise decisions and not just cut. One of the things I'm seeing lately because of the latest challenges in the macroeconomic situation is that a lot of finance team have been requested by the CFO, by the CEO just to cut 20% of everything. That was how things were done before because he said, I don't have enough visibility.Oded:I don't know, I don't have the time. Let's cut 20% our thing. Maybe we cut some good things, maybe we will not cut enough, some bad things. But we understand that we don't have enough visibility. Let's cut 20% outta everything with finance teams that have been ready for this situation and have clear visibility about what's works, what doesn't work, how we spend. They don't need to take these types of actions anymore. They can granularly look at each one of the spends and decide where it makes sense to cut because of the new macroeconomics. And when it doesn't make sense, because it brings benefits to the company, it might help the company to recover. These are these things that can only happen when you have enough data and automation infrastructure, which that's what we have seen across the board.Neha:Awesome. I love the insights you brought in there Oded, and I would like to dig a little bit deeper on that. You brought up tech automation a couple of times, and of course there are a lot of things that companies can do in terms of infrastructure updates and putting budgets into automation of these processes. But right now, with the economic downturn, like you said, not everybody has those budgets. And our busy accounting and finance professionals from around the world who are listening to this podcast today would like to change some things tomorrow or today if possible. What are a couple of things which are low risk but high return steps that they can immediately take to improve things at their workplace?Oded:So what I've seen in the market, there are so many tools that are either free or not expensive, that can give you people historically things about implementing financial systems is something that takes six months and require so much effort, right? The latest advances in technology, there are tools that can be deployed overnight. They are either free or very not expensive, and they can give you at least immediately visibility about what's going on. By the way, sometimes that visibility comes from places that are historically have been beyond the reach of the finance team. I usually take the example that is close to my heart. We are giving companies a tool that enables them to map all the services the employees are accessing even without knowing if they pay or if they don't pay for that. So the finance team, which historically they need to go to IT and ask their permission to get such a report so they can look to see if they are spending or they are over accessing or don't use enough a specific product, have the ability to get a real time visibility about what employees are using.Oded:If there are tools that are using a lot, which means that they might be paying a lot and we might want to scrutinize that or tools that they know that they are paying a lot, but they see that there is not too much usage. And that might create a process where they will go back to the vendor and try to negotiate or they will ask us to help them with that. So in the end of the day, it's finance team don't need to feel that it's all or nothing. Meaning if we implemented the very sophisticated accounting system maybe you were in a good shape, even if you don't, we are in a bad shape. There are enough tools that can first of all give them visibility because in the end of the day, wise decisions are based on fact and not based on feelings.Oded:Especially when it comes to finance. Listen, we are not talking about marketing or things that are less tangible by definition. We are talking about cash flow and run rate and things that should be very accurate. It's very important to know how much, when is the last month that you have to pay your employee salaries. Exactly. Not approximately. So what I'm, what I'm urging finance team is really not to say, you know, as you said, there is a downturn what can we do? Let's cut everything without even no questions asked, just ask everybody to cut everything. Spend a little bit more time trying to get better visibility of how your organization operate. And when you will do that, first of all, it will help you make better decision. But more important, it will be the infrastructure for you for the next time you will be requested to get this decision.Oded:And we are not, that's not, unfortunately, that's not the last times where probably people need to change the way they operate. Hopefully things will recover and then they will need to grow. Maybe they won't recover, and then this will take much longer and they, we will need to make even much tougher decisions then we are getting today. So don't get under, it's not about, don't get into hysteria. Breathe, count to 10. See how technology can help you. Don't be intimidated by thinking that it requires a lot of effort and a lot of time to implement fundamental technology and just do it.Neha:Wow. Those are some great lessons for our listeners here today, Oded. Let me pivot to your professional career. And we were talking about it. You've traveled around the world, you've lived in lots of different places. We were talking about your travel in India, for example, and there are lots of our listeners who are considering going global in their careers or having a more nomadic lifestyle. Now, is there a lesson that you would like to share from your travels and your work around the world?Oded:So pandemic really changed the mindset of executives and recruiters about where they can find talents in so many aspects, by the way, it's not only about traveling, it's the fact that now companies can aim to get the best talents in everything they are trying to do regardless where they are. Historically, they were really bounded in the geography where they were based. And if they knew somebody, great, but it was remote, he couldn't travel, that was probably, would've made them decide to take somebody that is not perfect but is much close by, that ended. Now companies can really try to aim and try to hire the best talent they can for the specific task they are trying to achieve.Oded:But from the other end, it brings new challenges because if you hire the greatest talents, they have much higher expectations and they are trying, they will be much more effective, but from the other end, they will expect from the company to support them in this global environment to enable to pay them salaries on time. We've announced a few weeks ago a partnership with a company called Papa Global, which is the world leader in global payroll and enables finance teams or global companies to pay employees whenever they are. This is a huge effort that is coming into the place. How do you pay the payroll and time and accurately? And second, these talents which will get a lot of responsibility, they will be in charge on strategic project for your companies. You should also enable them to pay for this specific project.Oded:You cannot expect them anymore to do out of pocket expenses as historically, you might have been telling them you, that's what it is, just pay and we'll talk about it in the future. So you need to have the infrastructure to enable that. I don't see, and I have a lot of conversation with executives, even if, and Covid, most of us have forgot Covid. But I don't see the world reversing in the way it operates. Maybe some companies will open again their headquarters but I don't see what was five years ago when companies have forced employees to move to specific location that's done. And last and not least, it means that for finance teams, that's the new norm. They cannot say, you know what we will try to move back to some of the processes that we've been used for so many years.Oded:They need to adapt to these types of behaviors. By the way, just an example, which not two people understand or they usually understand too late, which is you have an employee in a specific country and you enable him to pay cards or payment instruments works differently in different countries. You mentioned in India there are some specific limitations to how you pay where you are India for example. So not only things are becoming more complex, you need to understand and master things that before that you could have just issue a card from your all local bank and it should work well in the territory you are based in. So from one hand, a lot of opportunities, but it always come next that it creates new challenges for the finance teams. Some of them really enjoy the excitement and the fact that there is new things to do. Some of them prefer that the world would not have changed. That's not possible anymore.Neha:Right. The only thing that doesn't change is change itself. Right?Oded:Totally.Neha:I love those practical tips. Thank you, Oded. Now this brings me to the last question of the day. How can companies and finance professionals be future ready? So we are not caught off guard again, like we were the last time when the pandemic hit.Oded:So it's really important for finance team in my mind to acknowledge that it's not only about them, it's mostly about their employees. And what I'm seeing that more and more finance teams focus more and more about employees experiences, finance team that will be future ready will build infrastructure that is employee friendly, that employees lack. Like historically, there was a lot of tension between the employees and the finance teams about controls, about how employees, what they need to do in order to help finance team close the books in the end of the month. The future of finance and finance team automation is by building an infrastructure that employees like, which is sometimes sounds too good to be true. It can be done. And I'm seeing more and more finance team that don't only think about their own challenges and their own problems.Oded:They really see themselves as enablers. They're not only the bodyguards of the company treasury, they're also the ones who enables their employees to operate with less friction. And that's something that is very important. I really urge finance teams to think, rethink about the way they look at the, and the way they operate their companies. Finance team, by the way, one of the interesting things that the finance team have become much more dominant in the corporate structure. Historically, HR was very strong. Maybe IT was very strong. Finance was just the ones who were handling the books today, finance teams and especially finance executive that becomes the, the closest consultants to the CEO. They are, he listens to them a lot. You expect them to do above and beyond just to do the traditional finance activities. So for me it's really, I'm really urging them to take that opportunity, grab it, don't push it back and saying, you know, we have enough work by handling our own specific problems. Use the opportunity. I'm seeing so many CFOs that evolved have become much more dominant. Some of them even became CEOs over time, and that's only because they understood the new norm, they understood the opportunities that the future brings to them. And that's really exciting.Outro:This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Connect with MatRead more about Online to OfflineFull Episode Transcript:Adam:Welcome back to Count Me In, the podcast that brings you impactful people and stories from across the world of management accounting. I'm your host, Adam Larson, and joining me today is Mat Boyle, CEO of Online to Offline, to discuss how businesses and management accountants can make a big difference in the world by shifting their focus from profits first to mission first. While this is much easier said than done, as you'll hear, Mat's inspirational story is an important reminder that it's possible to do well in business and even better than ever when you measure your success by something greater than the bottom line.Adam:Well, Mat, I just really wanna thank you for coming on the podcast today. Thanks so much for sharing your time with us. And to start off, I wanted you to kind of walk through a little bit of your story with us as we were kind of talking, coming up to this call, you mentioned something that you learned to focus, no longer focusing on profit, but on the impact your business was making, and that's not something you hear every day. So maybe you could talk a little bit about that with our audience.Mat:Yeah, sure. Adam, thanks for having us. So the sort of condensed version of the backstory, I'd built quite a large sales training business. So I had four offices around Australia. We had a stack of businesses that will help in their sales teams, really navigate through the changes caused by the internet. And from a profitability point of view, it was amazing, but there was this kind of hole inside me that it was really unfulfilling and my days was spent training sales people that didn't want help. They needed it, but they didn't want it. So it was just this horribly unfulfilling sort of thing. And I met this guy back in 2015 who was an Australian guy that worked with the Thai immigration police. And he started talking to me about the work he was doing over in Thailand and how he was involved in rescuing kids out of exploitive situations and women outta sexual slavery and human trafficking.Mat:And the more we got talking, the more things just sort of opened up for me and the, you know, my heart sort of went, I've gotta see this. So about six months into the conversation, and I eventually convinced him to take me over to Thailand, and I spent three weeks working with him and his team in Thailand doing the front lines rescuing kids outta brothels and women outta brothels and just seeing this depravity, which is human trafficking, and you know, that some of the sites and the sounds were just horrendous. But the thing when I was talking to all these women and that, that the stories were identical, that they all needed money and got caught up in this life because someone gave them a job that they shouldn't have lent to money from someone they shouldn't have.Mat:Or they were promised a job that didn't exist and they were all taken advantage of by their desperation towards money. So when I was sitting back in Australia and I'm sitting back in a boardroom a few days later, I sort of had this idea of, well, instead of businesses paying me to train their sales teams not to do the work that I've paid them to do, I've been paid to do. What about if I just could automate and outsource all of these elements of the sales process, businesses could pay me to build the systems and manage the systems and they're gonna make more money, but then I can go and create jobs in these developing countries where all these women are getting exploited and train them how to operate my system and actually be able to use my business as a way of making good.Mat:So that's what we started to do and started to develop all these systems that can automate and outsource big chunks of the sales process, but do it in a way that no one actually ever realizes it's not been done by you. And in 2018, we ended up opening our first outsource center in the Philippines, which has gone gone amazing. And then Covid has gone slowed down our growth and we are on track to open our second center in Thailand sometime sort of before sort of March next year.Adam:That's quite a story. I mean, to have something like that caused such an impact on you that you want to completely turn your business around, that can't be an easy decision to make. And it's a very risky one.Mat:It was a very easy decision to make because I made it with my heart, not with my head. It was an incredibly risky situation. And the journey between sort of 2016, 2017 when the idea came and where we are now, we certainly have faced the consequences of that, you know, of that decision. Because going through this said, I made it purely with my heart of going, I have to make an impact from there. And I kind of threw out all conventional business acumen around, well, what happens to your existing customers? What are you gonna do with everything you built up? And so over a period of a few months, we ended all of our contracts. I just stopped prospecting for new business and didn't replace them. And just focused our whole energy on trying to fix, solve this problem and, and tried to create these systems and open the center.Mat:And, you know, as is often the case, it always takes twice as long as you think it's gonna take and takes three times the amount of money that you think it's gonna take. And, you know, through all of that journey, the consequence is we actually went through complete financial meltdown and we lost our house, lost our cars, and basically went down to having $50 to our name at our kind of lowest point. And you know, that's kind of where we were able to kind of keep persevering and keep getting through. So like fortunately now we're in a much stronger financial position than we ever have, and the business is going great, but there certainly was a big journey from start to where we are now, which has been challenging.Adam:So maybe we can talk a little bit about that journey, about becoming to the success you are now. I know a lot of that contributed to getting the right people in place in your organization to make sure that you were doing the business in the right way. Maybe we can talk a little bit about that to how that became successful.Mat:Yeah, so there was a few kind of phases where I was first in that survival phase where it was just me. I was just hustling. I was just, you know, I was robbing Peter to pay Paul and I didn't really have a financial strategy in place other than how can I pay this week's bills type of strategy. And that, you know, although that was getting us forward, that was creating other holes with taxation and a heap of other kind of just areas that, because I was so single minded focused on the goal at hand and trying to do everything myself or being left behind. So I started to look for support teams and one of the sort of first pieces I put into place is actually bringing on a fractional CFO. I've been working with a lot of the accountants and, you know, all the accountants, all they kept doing was just filing my tax returns and telling me, because you've done A, B, and C this way, this is what we've had to do.Mat:So they're just telling me about their problems and how they've stuck a bandaid over it rather than actually working with me to try to solve the problems. And that just kept making, compounding the problems, you know, and just putting us deeper and deeper and deeper in a hole. So I'm, you know, one side, I'm, you know, busting, busting everything. I've got to try to get ahead and with boosting our revenues and bringing on more staff. But on the other hand, I'm now creating this big problem with taxation and all those other kind of compliance matters because I'm just putting every cent that we make back into growth. And the accountants that we're working with just didn't actually stop me and shake me and kind of help me put a proper plan in place. So I brought this CFO on, who spent the time to kind of just understand what we were doing, understand where we were at the business, and really kind of, you know, on an emotional point of of view, helped me kind of, just kind of, you know, remove the shame around that.Mat:But then from a logical point of view actually said, Well, we need, let's just get, get a clear understanding of where you are now, but let's put some frameworks in place and let's start the process of kind of digging, you know, digging you outta this hole and doing it properly. So that's been, you know, been an amazing kind of thing where he doesn't know what the answers are to the questions about how, for how me to grow the business. But what he's been able to do for me is be able to ask me the right questions and keep the right focus to make sure I'm putting the right information and then building the right frameworks around it to be able to, you know, allow me to kind of, you know, slowly get on top of the taxation issues and, and slowly start building a really stable foundation underneath the business that we had that's gonna allow us to continue to grow and make a bigger impact.Adam:That's great to hear. I mean, there's something that has been written about on many research papers and articles at IMA is that the CFO of the future is not just a number cruncher, but is somebody who is truly a business partner, has a seat at the table and hearing your story. It shows that your CFO is sitting there doing that. How has your CFO been able to help guide or help give the best advice for strategic decisions moving forward as you look to the future as your business continues to grow?Mat:Well, it's really, he's been both a hand broken accelerator, so he's really kind of just worked within us of going, understanding my vision, understanding where I, you know, where I want to go and where I want to take this. And then also understanding what the risks, what the risks are. So in certain areas, like with our growth with wanting to open our second center, he's really pumped the breaks on that and said, Well, let's cost it out. Let's budget it out. Let's make sure we've got the sustainability before we go and commit to it. So he's helped us get very clear on where we need to be as a, as a company before we can take on that extra risk. He's also sort of just helped us look at where our income comes from and what, what income has been kind of in the one-off project work versus the recurring everyday work and kept challenging me to refine our product offering to build better sustainability and increase that kind of lifetime value, which has enabled us to sort of accelerate growth on the other end.Mat:So he's really been that, you know, again, he's just the accelerator and brake that, just telling us when to speed up and when to slow down.Adam:As I'm hearing you talk about the different growths and being able to, you know, stop when you need to stop, put the brakes in and go when you need to go, what role has technology played in this whole process of growth within your organization?Mat:Well, look, technology has just really simplified communication and simplified sort of tracking. So we've built in the, the systems that we're still, still refining, but we've built in these systems of sort of financial tracking that we know exactly where we are as a company at any point in time. We know what our liabilities are, we know where our income is, where it's coming from. We also know where we are and benchmarking where we are compared to where our goals are and where we need to be. And because all of that's happening in real time, we can have more of the conversations we need to have about how can we increase our revenue this month? Why is our expenses, you know, you know, why our expenses more than what we sort of budgeted for. And, you know, either resolve issues and what I call kill the monster while it's small. So deal with issues while they're small or be able to kind of just go out there and make some, make some adjustments to go and bring some more income in to keep us on track. So it's been vital.Adam:Yeah, that's, that's something we've been hearing as well. Just the fact that it kind of shrinks everything down to make it communication better to make financial statements better, to make it easier to analyze your data, to understand where the money is going, to understand what things are looking like for the future. So it seems that it's having the same impact that it's having for a lot of other organizations for you as well. Something that's really important is communication within the organization. And how has, I mean, I don't know how big your organization is, but how has your organization as a whole kind of shifted in this whole changing?Mat:Well, we've kind of been able to empower a lot of our team from there. So part of our sort of modeling with all of this and looking at our growth is we really wanted to gamify and incentivize our team for, you know, our client retention and all that kinda stuff. Cause the longer we keep clients, the less churn we have, the more, you know, more growth we have, the more profit we make. So we've been able to kind of flow all of that kind of data down and actually really incentivize our team for their performance and for, you know, for keeping clients. So, you know, through that we've been able to sort of just have those sort of daily progress reports that all of our agents see, you know, how they're working, you know, the results they're delivering for their clients compared to benchmark, if they're ahead of target or below target. And if they are ahead of target, what type of bonus and incentive they have in place. So having that, that there, that they can see on a daily basis and, and had that in real time numbers has, has been a massive help in them actually reaching out. It's really changed their behavior that they're reaching out and asking for help and being more proactive with making some of the changes, you know, to the campaigns that are helping us deliver better results for our clients, which therefore improves our bottom line.Adam:So if we go back to kind of where we started, where you were talking about how you wanted to focus no longer on profit, but on impact, how has that had personal effect on you, as in your leadership style and how you've kind of guided your team through this?Mat:Well, it's been been massive, and it's one of those things I get asked that regularly, and it's really hard to answer from an exact point of view because who I am now to versus who I was six or seven years ago, I'm a completely different type of leader. But the probably the biggest impact that everything has is when I wake up in the morning, it's not how much, you know, my focus isn't on how much profit I can make. My focus is on how many jobs I can create. And, and that's that whole driver. And then when I am looking at my organization, it is about, you know, right, how can I build the best team culture? How can I support the community that our center operates in? And how can I support my team as much as possible and make their life better for being part of our team?Mat:So everything has gone around that. It just happens to be that the byproduct of all of that has been that we serve our clients better, we give them better results, which means we actually make more money. So it happens to be that the cycle we've created is the more impact we have, the more profit we make, and the more profit we make, the more impact we have. But, you know, when I started this, it wasn't about making profit and it's something that I had to, through the journey get quite comfortable with in the fact of I can actually have this business that is making such a profound impact in lives, and it happens to make, you know, make it a tremendous amount of profit that I can live off and I can live very comfortably off. And there was a lot of guilt, you know, that I had to kind of work through with that because it was, you know, I couldn't give it away fast enough. I couldn't put enough money back into jobs fast enough. And every time I did that, there just happened to be more money coming in, coming in as a result of it. So it's been a great consequence, but the focus now is not about about profit, it's about about jobs and being able to impact our communities and sort of, you know, improve the lives of people around us.Adam:It's something that just makes you think and wonder like, what if every organization was focused on that? Would we live in the same world we live in?Mat:I don't think so. I think there, there is a shift and it's coming and it's evolving. And I know that sort of journey that I went through was, you know, from a very selfish business that, you know, it was just about me and my family and, you know, putting food on the table. And there was nothing kind of wrong with that. But then I had my eyes sort of awakened to something that I'd, you know, had no one knew existed. And, you know, we had six kids very close together, and as I'm hearing these stories about parents having to sell their kids into these exploitive situations or renting them out in exploitative situations and, and that, you know, my heart just opened up and went, like, I just had to see it. And then when I saw it, you know, my mind kept opening and then I went through this phase of I'm just gonna keep growing my business here and making more money here so I can donate more money.Mat:And that was that kind of thing of, I'm gonna make more money so I can make more impacts. And then it evolved into, I'm just gonna make more impact so I can make more money. So that was kind of the evolution that I went through and that took a period of time. And I can see on the broader scale, a lot of businesses are kind of at different phases of that evolution toward, you know, moving away from profit and onto impact. But I surely believe that if more businesses focus on genuine impact and genuinely improving the lives of people around us and improving the environment we live in and making some positive impact in the world and in whatever, you know, scale or whatever sort of area is important to them, if more people did that, things are gonna change and change for the positives,Outro:This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Connect with ToriConnect with DennyLearn more about the CMA CertificationFull Episode Transcript:Adam:Join us in this bonus episode of Count Me In, where IMA brand storyteller, Margaret Michaels sits down with two noteworthy CMAs to discuss the 50th anniversary of IMA's globally respected certification for accounting and finance professionalsMargaret:In this special Count Me In podcast, celebrating the 50th anniversary of the Certified Management Accountant or CMA program, I will be speaking with two CMA exam takers, Denny Beresford, who earned his CMA in 1972 and made IMA history by becoming one of IMA's first CMAs, and Tori Heavey, a recent graduate of the University of Tennessee at Knoxville, who won the CMA student award for the highest score on the exam in the June/July, 2020 testing window. Tori also recently won the Elijah Sales Award for her CPA score. Denny has spent a lifetime working in accounting and finance. He currently serves as a member of IMA's Financial Reporting Committee and as the executive in residence at the JM Toll School of Accounting, Terry College of Business at University of Georgia. Tori is a recent graduate of the Master's in Accountancy program at the University of Tennessee Knoxville, and is currently working as a tax associate for KPMG.Margaret:Thank you Denny and Tori for joining me today. As we talk about your experience taking the CMA exam. Denny, you have the distinction of being among the first people to sit for the CMA exam in 1972. At that time, the CMA exam was administered with paper and pencil and the field of management accounting was not widely known. What do you remember about taking the CMA exam? How did you learn about management accounting? Was it through school or work experience and what are some of your study methods and tips?Denny:I had been a member of IMA, it was actually the National Association of Accountants or in earlier years since 1962, shortly after I graduated from college. And in fact, I'd been active in my local chapter back in Los Angeles, rising from a helper on some of the committees to become president of the chapter shortly before I transferred from Ernst & Ernst's office in Los Angeles to the national office in Cleveland in 1971. So I was very familiar with what was going on at, at the organization and the fact that the CMA exam was being developed over a couple of years before that. And I guess I was generally familiar with the management accounting profession, having again been participating in IMA for a number of years being involved particularly at the local chapter level and then also at the national level.Denny:And also having been an auditor and interacting, of course with many of my clients for that period of time. And when the exam was was first offered, I decided that it would be a good thing, first of all, to support the organization for by taking it. And I thought it would be something that would help build my self confidence, you might say, in dealing with, with clients. Since I was a public accountant, I knew that I had to be able to speak intelligently to controllers and chief financial officers and others who were involved in the management accounting profession. And so I thought that being able to pass an exacting exam like the CMA would again, give me both self confidence and also a positive credential that would show that I was on similar footing to them.Denny:What I remember about taking the first exam, I was in Cleveland in the National Office of Ernst & Ernst, and at that point, and I don't remember how many different settings there were, but the closest location that I could, where I could take the exam was Pittsburgh. So I had to I go there, drive over to Pittsburgh, which isn't too far from Cleveland. I had to stay overnight. And the morning of the exam, there was an ice storm in Pittsburgh. And another fellow and I were both gonna take the exam together and we had to drive from the hotel to the, I don't remember exactly the place it was being held, but it was a half hour or so away, and we could barely make it there because of the streets were all icy and it was just a terrible weather situation.Denny:But and it was in a cavernous location, some sort of a very large convention location, something like that. And it was large and very cold. And again I had no idea how to prepare for the exam because back then there hadn't been any previous exams, had nothing to to go on in terms of looking at what questions had been asked in the past. And for the first exam, what the organization had done was give a list of books that you could consider studying to prepare you for the exam. I thought that was kind of a good idea, but not a very good use of my time. I knew that a couple of the parts of the exam, particularly Generally Accepted Accounting Principles and some other parts were pretty much in my wheelhouse and I could do well on those.Denny:The other parts I wasn't so sure about, but I felt that trying to study them by going back and reading textbooks or the like, would not be a very good use of my time. So my strategy, if you will, was to try to do well on one or two of the parts, and then of the other parts that if I didn't do so well the next time when I had to take them over, I'd at least know what to study for. And as it turned out, I passed the whole exam the first time and had one of the 10 highest scores. So that strategy worked out pretty well and it didn't have to go back and study, but that's as much as I remember about preparing for the exam, why I took it and exactly what happened when I was there.Margaret:That's great. That's a great story about the ice storm. You really persevered taking the CMA exam a very rigorous enterprise indeed. Tori, now that you've heard Denny's experience, how do you think the way you've taken the exam is different from Denny and what did you do to prepare for the exam?Tori:Yeah, my experience was a little different. I did not have an ice storm to deal with, but I've kind of grown up through the shift to digital. I rarely ever used computers for school until I came to college, really. Freshman year, most of my exams were still on paper and pencil. And gradually more and more classes switched to exams on the computer. And this transition really helped me prepare to take the CMA exam electronically, specifically for the essay portion. It helped that I'd improved my typing skills tremendously over the time or the few years I'd started using computers more and got more used to typing papers online or even just using different software. I used the Wiley CMA exam question bank to prepare and study for both parts of the CMA exam. And it was totally computer based. All of my prep except for my own notes that I still write on paper and pencil.Tori:But seeing the exam simulated during my studying in this way definitely helped a lot. It familiarized me with the test software and it made actual exam day a lot less daunting just to have kind of more familiarity in being used to the situation that I would be in. Cause sometimes it can be so nerve wracking on the exam day to go into a testing center. Right now we use Prometric centers, which I'm not sure if y'all are familiar with those, but you have to schedule an exam slot online, a few, usually a few weeks or months in advance. And then the day of you show up and you are assigned a computer that has like the blockers all around so that everyone is, it's almost like small cubicles around a little desk that has a computer at it. So it's definitely different, but I think it sounds like it's still pretty similar, but a lot more computer based and electronic. So I guess that's our biggest difference.Margaret:Right. And maybe Tori, can you talk a little bit about your motivation? Denny had talked about wanting to have more credibility in front of people that were management accountants. What was your motivation for taking the CMA exam?Tori:Yeah, so I found out about the CMA exam during an IMA presentation at my Beta Alpha Psy meeting during undergrad. It was actually my junior year of college. And at the time I was taking our cost accounting class which I was really enjoying. And later on I talked to the speakers, they introduced the CMA exam scholarship, and my cost professor, Ms. Winegardner ended up nominating me for that. I think professors can nominate up to 10 students each year. And that's how I got the Wiley exam test bank study prep. And it also covered my exam fees for both parts. So I was able to take, it's a very cost effective way for anyone interested. And I guess really my motivation stem from how much current professionals who were coming in to speak to us and teachers and professors, how much they were willing to invest in me and seeing them support me motivated me to put in the study hours and to not only pass, but you know, to really give it my 110% effort and do well if it's something kind of taking advantage of the opportunities that are presented to me and seeing if these people that I respected and admired who were doing so well in the accounting profession, if it's something that they respect and is something kind of seen as when you see someone as a CMA that they know their stuff, you know, kind of. And that's something that I wanted to do.Tori:And like I said, just really see opportunities and take advantage of 'em.Margaret:I like what you said about when you're a CMA it means that you know your stuff and that other people know your stuff as well. So I guess, Denny, my question is, once you passed the exams and once you became a CMA, did your career accelerate? Did you find that you had new opportunities? How did the CMA help you in your career?Denny:Well, let me first of all go back. Let me double back on something that that Tori was saying. I think it's terrific that she was able to take the exam and become a CMA while she is still in school. I guess she doesn't necessarily get the certificate until she has the work experience. But most colleges, most leading universities, I'm at the University of Georgia, she graduated from one of our close competitors at the University of Tennessee. They tend to emphasize, and I would say even overemphasize public accounting in the curriculum. And it's almost you have to study for the CPA exam as kind of the very narrow focus for most of the students. And the reality is that that a very small percentage of the graduates will stay in public accounting, where the CPA is really a necessary part of the work situation.Denny:And most of them will end up in some aspect of industry, of corporate position. I'm not suggesting that that's what Tori's goal is or where she will end up, who knows. But, but preparing yourself for that possibility more while you're in university, I think is something that students should pay more attention to. So that, that was my point there in terms of what it did for me, again, I think it achieved my goal of giving me more confidence in my, in my ability to deal with individuals. I have to say that I was already pretty successful in my, in my career. I became a partner at Ernst & Ernst, it's now Ernst & Young at almost the same time that I passed the CMA examination became a partner in the fall of 1972.Denny:And that's just when I passed the exam. I then later on became one of the senior partners at the firm and left in 1986 to become chairman of the Financial Accounting Standards board, where I was for 10 years, served the maximum of two five year terms. They went on to the University of Georgia and have also served on six large corporate boards where I chaired audit committees. So I won't say that, that the CMA caused all of those things to occur, but it certainly didn't hurt. But my graduation from the University of Southern California didn't hurt my CPA. Passing all four parts of that the first time didn't hurt. Working very hard all of those years didn't hurt. It all was part of the package. And again, it if it was part of my overall, not necessarily work plan, but my career was one of continuing education and continuing to try to build on what I had done previously and learn new things and continue to get better.Margaret:And that shifts nicely into our next topic because there's a lot of continuous learning that management accountants have to do to meet the demands of technology and the rapid piece of digitization in the profession. So, Tori, I guess I'm gonna start with you. How did taking the CMA exam prepare you for the technology that you'll use in your job every day or that you probably are using in your job every day now?Tori:So I was a tax concentration during my master's accountancy where most people now it's very popular to do information management or at other schools, sometimes it's called information systems. So yes, the CMA exam definitely taught me a lot about data analytics in other transformative technology and supplemented what I wasn't learning as much in class because I was taking more tax classes. I learned really well by reading written words. So learning about automation and software systems during studying actually has helped me understand the software applications that I use now for work. And it's given me just a new perspective to troubleshoot when something isn't working as it should, where before I kind of would shut down and just think, well, the computer's not doing what it's supposed to be doing. I don't know what to do because it's just supposed to work this way and it's not doing what it's supposed to.Tori:Where now I kind of think of potential issues in a way that I never would've even kind of considered to think about before. Technology can be kind of like scary or maybe hard to learn at first for me, especially cuz I'm kind of, like I said, I'm very traditional. I'm not as good with learning new things or I'm just not as, I'm not excited about, I'm not the first adapter. I'm kinda a little bit more of a hang back and see how things work out, but it definitely adds value through efficiency and minimizing human errors. And it's really helped us be able to work kind of in our new remote environment. A lot of our work processes would not have been able to be moved to remote if it hadn't been for all the technology that we use now. And I think that I definitely add value to our team. People come to me sometimes about some of our systems that I've picked up really quickly, even in my first year working, just because I have that background, like I was talking about from learning how systems work and each of the different processes and kind of the backside of things when I was studying for my CMA.Margaret:That makes perfect sense. And Denny, as you watch technology evolve, how has it changed the job of a management accountant from when you entered the profession to today?Denny:It's just night and day. I mean, back just as it was pencil and paper to take the CMA examination, it was mainly pencil and paper to do the work. When I first started in public accounting and was auditing corporations, we then had very rudimentary data processing. We had 10 key adding machines that we were using. Tori mentioned that typing was very important to her, to learning how to type better. That's something that stayed with me. I took a typing class in junior high school and fortunately that's something that stayed with me for years and years. But other than that things are just completely different, we didn't have coffee machines. We certainly didn't have cell phones. It's just, I can't even describe all the differences. It's just today, it's it's a whole new world. We have drones going out and doing inventory accounts. It's almost like science fiction, frankly. If you tried to compare it to what things were like 50 years ago.Margaret:Yeah, I bet. It's been remarkable to see the evolution of technology and how it's changed everything about our lives. And Tori, I know that you had said that with technology, you're not necessarily the early adopter, but you, you know, like the increased efficiency that it brings, what excites you about technology?Tori:I really like how it brings people from really kind of all across our teams now are so spread out that you're not just working with someone in the same office as you. Although I will caveat that with, it's hard sometimes. It's nice to have our face to face time with your team. It's good to build those relationships, but still technology has enabled us to be working on like the same client, the same work papers. You can check in our data management system or document management system. You can check in one set of work papers and someone else picks it up on our India team when it's so busy during busy season, we have people working 24 hours a day all across, like in different time zones. And I guess that kind of speaks to the efficiency, but then also it's pretty neat that we have teams that are so diverse and spread out. It's pretty cool.Margaret:Yeah, the ability to work real time around the clock and globally certainly, you know, makes multinational corporations like run as well as they do. And I guess shifting to continuing education as a requirement for maintaining the CMA. And IMA providing continuing education to all members. Denny, I know that you've served on IMA's financial reporting committee. How has being an IMA member with access to continuing education helped you in your career?Denny:Continuing education, as I mentioned before, has always been very important to me. And, in public accounting, the firm provided continuing education as part of the job. I'm sure that's true with Tori as well right now. But they also were willing to, to pay for classes that I could take on my own. And I always consider that to be a fringe benefit and I took a maximum advantage of it. I didn't go for an additional degree. I started a part-time MBA and then decided that was kind of a waste of time because MBA programs were very unsophisticated back then. But I took a lot of individual classes on things that I thought were very germane to my job. For example, some when data processing was just becoming more sophisticated, I started taking some classes there, statistical sampling, any number of of classes that were being offered by IMA, by the CPA societies, by universities. I wouldn't say it was directly related to IMA, although I've certainly attended a lot of seminars, annual meetings and certainly chapter meetings, which were very educational, over the years. But the key is to take advantage of any opportunities that you have and to keep learning and to try to stay at least up to, if not ahead of the curve if you possibly can.Margaret:That's very good advice. And Tori, you a relatively new member of IMA, how are you planning to take advantage of IMA's continuing education opportunities and are there any areas in particular that you wanna learn more about?Tori:Well, I think kind of like Denny was saying, it's awesome that they provide so many free resources to members for CPE because a lot of people have to seek it out on their own, especially once you move into industry. When I've talked to people, it's kind of one of those things that right now I'm in public accounting and they push a lot of the firm provided resources, but then once you move into industry or to smaller firm, you kind of have to find things on your own. So it's really neat that the IMA website kind of gathers that all for you in one place. I was actually looking around on their website the other day and I plan to attend some of the online courses and they also have some webinar webinars available that I'll probably try to attend if it works my schedule and kind of sign up for, I saw a course on emotional intelligence, which is pretty interesting to me.Tori:I was reading about it and it stuck out cuz it's so important to foster relationships, you know, even when we're trying to push through so much work, sometimes we can get so focused in on the work product instead of the people we're around and kind of building our team. And I forget to be intentional with my interactions with people when we get into those high stress, busy season situations. But I'm excited to take this course and kind of hopefully learn how to better empathize and work with other people when we're in that business context instead of just our everyday lives too.Margaret:That's great. Yeah, and there has been a lot of, I guess, research about the importance of emotional intelligence, especially among leaders because technology is great, but it's only as good as the people that are behind it. So I guess we can shift to closing remarks. Hitting the 50 year mark speaks to the value of the CMA program. I actually wrote a blog this year about how the CMA program was built to last with skills people can use for a lifetime. And there are not many things in this world with that kind of longevity and staying power. So, Denny, what are your thoughts on the relevancy of the CMA after 50 years of existence?Denny:Well, I think it is very relevant and I think the, the the best thing is that the size of the program is much bigger, much better than it has been ever. As I said earlier, I've been involved with IMA for over 60 years now, and the thinking back to when the program started and then being a national director for a couple of years and of national vice president and just being active in general on the financial reporting committee, for example, for I had a couple of dozen years we've talked and talked about growing this program. And I can remember more than one national president of the IMA or chairman of the IMA saying, we expect to have X number of members by such and such a year, maybe back in 1975, we expected to have by 1980, a hundred thousand members.Denny:Well, most of those projections never came to fruition. And the program frankly, was limping along for quite a long time. But in the last 5 or 10 years or so, it has really taken off. We have many more members now. It's much more recognized. It's probably a lot more frequent that you would see in a, in an ad for a management accountant that CMA encouraged or required or whatever it might be 50 years ago, no one would even know what a CMA was. So I think that's probably the best sense of relevancy is that the program has grown so much and that it has sort of an upward trajectory and people are finally catching on that this is something that's really important. And I think it's just all up from here.Margaret:Well said. And Tori, what do you think the next 50 years holds for the CMA and for your career?Tori:So I think that the CMA will continue to enhance the accounting profession, especially as it evolves to fit the changing business world. Like the heavier focus on information technology we've talked about today, offering resources to members, it's gonna allow them to improve their skills and to keep distinguishing themselves from peers. The CMA is definitely something that's respected in the accounting profession. So especially as we see more and more jobs becoming obsolete because of changing technology, people are going to have to adapt and learn a new skill set to make themselves stand out. So those resources that the IMA is offering, you know, learning about artificial intelligence, ethics in a digital age, and especially data security is huge now. It's really gonna help IMA members and people who earn their CMA to keep contributing to our accounting world. As far as my career, I'm not really certain what the next 50 years will hold.Tori:That sounds like a long time, but I do know that technology's not gonna go away, whether I will be serving clients in the public accounting or moving into industry or even maybe into the academic field. I guess my plan is just to learn as much as I can, seeking insight from people around me who are further along in their accounting careers and who have experience and insight that they can impart and just continuing to take advantage of any resources at my disposal. I think the key to success is being just receptive and I'm excited about it.Outro:This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Connect with Dr. Marsha HuberRead the report Thriving Amidst Challenges: A Guide to Small Business Resilience Full Episode Transcript:Neha:Welcome back to Count Me In, the podcast where management accounted stays center stage. I'm your host, Neha Lagoo Ratnakar. Today, I'm joined by Dr. Marsha Huber, who is IMA's director of research to discuss a recently published report, Thriving Amidst Challenges: A Guide to Small Business Resilience. I have to say, this report is such a great example of the timely and rigorous research IMA specializes in with the goal of providing practical insights and actions that truly help businesses learn and grow. We cover a lot of ground in this conversation, but make sure to download the full report using the link in the shownotes, because it's literally brimming with insights that can be put to use immediately. Now let's get started with Marsha.Neha:Hi Marsha, welcome to Count Me In. It's such a pleasure to have you on the show.Marsha:Oh, thank you so much Neha. I feel privileged to have been invited to talk about this IMA publication.Neha:Oh, it's all my pleasure, Marsha. And first of all, congratulations on your new report. Thriving Amidst Challenges: A Guide to Small Business Resilience and that's quite mouthful, but a very much needed topic. Can you tell us, our listeners, what this report is all about?Marsha:Yes. It's a report that was developed from interviews with business people, the small business development center, and various members of the small business committee at the IMA. And I spoke with people, read interviews and developed models with people and experts, and here's the report of our findings.Neha:Cool. And I'm glad you were able to do all that. And how did you come up with this topic? What's the story behind this report?Marsha:Yeah, it's really interesting. I was not the originator of this report. During the pandemic, the small business committee at the IMA had a heart for small business and they actually had another publication. And then this was the second of the two about resilience, small business resilience. And I was invited as a new researcher at the IMA to help the small business committee write this report. And that's what I did. And it was a excellent experience.Neha:Thank you for sharing that journey with us Marsha. So, let's talk about the resilience model. I found it very interesting. Where does that come from and how can it help businesses bounce back?Marsha:Yeah. This came from actually a lot of interviews with the small business development center, Youngstown State University, because they worked with small businesses and they worked with small business during COVID. And at that time, when this was happening, I was also a faculty member at Youngstown State. So I worked with them as well to work small businesses. And so we decided to think about companies that thrived, you know, this is a report about thriving during hardship and resilience, the very definition of it is bouncing back. So how can you bounce back when certain challenges come your way? And what happened was we found three elements among the businesses that thrive as well as the experiences of our small business committee members. These different three, there were three concepts that stood out. And would you like me to describe those concepts?Neha:Sure. Go ahead, that would really help our understanding of the model.Marsha:Okay. So just imagine three circles, and you can also look at the report as I talk about these things, because these are illustrated, but you know, I'm just gonna lay it out three circles and one circle is business focus. And of course, during COVID, and now, we still have a continuing pandemic. You know, business focus is important for everyone, but it's not everything. Okay. So what else we saw as a visionary leadership and the companies to thrive, they could see beyond they didn't lose sight of their goals. They kept their eyes on the goals, but they also had to be flexible and agile and they had to change for the circumstances and they could see things that they never saw before. So, and I might give some examples if you want some in a moment. And then the other element that was so important was a people-centric culture. That the companies that thrived thought about their people, they thought about them as family, you know, not worrying about, you know, we have to lay people off or we have to do this and that they're thinking about how can we keep our people here?Marsha:They're our family. And I think you see now even a heightened awareness of wellbeing, but before the pandemic, yeah, wellbeing is around. But right now it's very important. And I think it actually began at that time where everybody was in the same boat, we were all working from home, having kids at home, you know, things happening, dogs coming in our Zoom meetings, our animals and everything else going on, that we had to change. And some of those things brought humor into what we did. And when you bring these things together, the business focus with the visionary leadership and the people-centric culture, those items mixed together, came to what I called a zone of thriving.Neha:Wow. That was very insightful. And thank you for bringing the human bit in it. It is true that the pandemic did bring out that human side of us. We were more real on those Zoom calls than we are in the actual office setup.Marsha:Yes. Like I'll just give you example of one company, they were in the concession food truck business. Now during COVID, there was no food truck business to go to, people were not going out to eat. All their orders were canceled. And they were the top food truck company basically in United States and everything came to standstill. So they thought, how can we keep our people working when we don't have a business anymore for a while? And so they developed and they saw, looked at everything they had, they basically reenvisioned what they could do. And they started a hand washing station business. And they cuz they had the products, they had the manufacturing process, they had the people and that's what they launched. And then they started selling these hand washing stations. And the University I worked at, they put them in, people put 'em in venues and they're really cool. You don't need to touch anything. There's three stations, you're six feet from each other. And then you wash your hands and your, the soap is there. You wash your hands, you dry your hands. It takes like 20 seconds. And then the next person could go. So that's the very ingenious idea that came just because they cared about their people.Neha:Wow. That was pure genius, I agree, Marsha and thank you for also volunteering a bit ago to talk about some examples. And let's talk about the six Rs of resilience. That's something that also stayed with me. Can you give us some examples of what that means for a management accountant?Marsha:Yeah. And when we talk about the six Rs, let me mention them, under visionary leadership, there's reflect and reimagine. Under business focus, there's reevaluate and reinvent. Under people-centric culture is reconnect and recharge. And again, you know, it's the six RS, resilience, you know, was a way to model these things, these different ideas. So the first example already talked about was visionary leadership, you know, reflecting and reimagining, you know, what can't we be? What can we use our resources to do to help our business or even our client. We have a story from one management accountant where, you know, there, she was working with a performing arts company, right? So you can't during COVID, you know, we couldn't meet people. She had to help the organization reenvision what they could do. So this local company, she helped them. She used zero based budgeting to help them look at their resources and what they could do.Marsha:And then they reenvisioned what they could be. And they opened, and they became a global company that taught performing arts to people all around the world. So that's an amazing change and long lasting as well. You know, so that is, you know, that part of what we might call the sticks are, is a root of resilience. It's, you know, and a lot of people, they don't spend time, they focus so much on a problem. They don't do the reflect and reimagination, and I think that's very important to do. And then the next step of course, is the business focus, which management accountants, the accounting and finance professionals that we're involved with, that we have the, we have the financial data, we have non-financial data and what are the type of things that companies need, or maybe the C-suite needs. So, you know, it's reevaluating, what are the key performance indicators that are needed?Marsha:And that's what, you know, some of the management accountants did as far as for their organizations. And we have one management accountant that actually had a business, they were a specialized tax consulting type business, but they thought, okay, what do people need now? What are the helps in the financial realm? And the beginning of COVID people needed help with the incentives that the government was offering. And they closed and went into that gap and made those offerings. So that was part of, you know, this part of the process with the business focus of reevaluating what was needed and reinventing. And then the third part is this people center culture. So, you know, this idea of reconnecting, but not just reconnecting. Reconnecting with others in your organization and reconnecting with customers. Companies had to reach out to customers in a different way to say, we're here.Marsha:You know, we're doing this now and then recharging ourselves because reports say that even today, anxiety is an all time high, not only among workers, but among the population over a period of just one year is three times the people are reporting anxiety, symptoms of depression and anxiety. So what we going to do you know this constant you know, what do you call it, the unsure future? You know, we think the pandemic's over things are going on. Something new happens. And even though you might feel like you've adjusted to it, no, you don't really still have to make decision every day. You know, like, am I gonna go to this conference? Am I going to wear a mask, not wear a mask? What about the family outings on and on? And it's not as critical as it was in the beginning where we knew nothing, but still it's a consideration. And the people around you with different attitude and opinions and all these different things. So, you know, we still have this bit of stress and anxiety. Everything is not back to how it was pre-pandemic. The way we work has changed forever.Marsha:Eighty percent of companies say they're going to keep some form of remote work. And new workers are demanding remote work. And remote work worked of all things. So, you know, this is the thing about, you know, all these changes, even though it's been a year, a year and a half, we still haven't adjusted to everything. Companies are still trying to figure things out and we are too, what we like, what we don't like, how much interaction do we need with other people? How do we perpetuate our culture? So this part of stepping back and focusing on people is key. I mean, I just heard a panel. I'll just throw this in, it kinda blew me away. Maybe people may not wanna know this, but this big four accounting firm said they have sad days.Neha:Okay, what does that mean?Marsha:Before you just take the day because you're sad. No one would've heard of anything like that, without getting without, before you, if you were having some sort of family problem, mental distress, you know, you, people would generally hide it wasn't accepted. You would see it as weakness. Here's an accounting firm that says, okay, we know things are happening. If you need a day off, you can just say, I need a sad day and take the day off.Neha:Way to normalize it. I like that.Marsha:Yeah. Normalize it, like it's OK. Take a sad day. I don't know, it kinda blew my mind when I heard it. I'm like, wow. A sad day. So are all things, how to put your people first? And we, we have one of our IMA committee members spoke about that and being transparent. He felt his management team had to be transparent and cared about the safety of their employees first. So that's a big shift in the mental attitudes of leaders in business. And I think it's a wonderful thing.Neha:I agree. We are evolving for the better, for sure.Marsha:Yes.Neha:All right. Talking about evolution also reminded me about nature and you do bring up a very powerful concept in your report about creativity, where you compare mountain climbing with mountain building, help us understand why that concept is so important.Marsha:Yeah, it's a concept I ran into from this guy, his name is Jay Barney. He's considered one of the fathers of strategy. And as I was looking for ways to describe creativity, there's mountain climbing a mountains in front of you. You climb up, you take the effort and you're not a first mover. You're reacting, you're reacting to the market. You're reacting to what's happening around you, right. Versus mountain building. But what if entrepreneurial opportunities were not just mountains waiting to be discovered? What if rather is searching for mountain climbing opportunities, business engaged an iterative learning process that ultimately led to the formation of mountain building activities. So the idea is instead of climbing the mountains in front of us, let's build our own mountains. Let's be a first mover. Let's look beyond again as I mentioned earlier, reacting to problems, being entrepreneurial, and looking for opportunities being first movers. And first movers do have a competitive advantage rather than copying. You're gonna be the leader. And so there's a different way to view things.Marsha:And that's a creative mindset, you know, looking outside, not staring at the problems, but looking for the possibilities, not being distracted from your goals. There is a company and they won the 2020 award for the most innovative small business enterprise in the United States. And actually what happened is the pandemic catapulted them forward in their future plans because what they couldn't do, they were a manufacturing plant, but they're also starting to look at 3D printing. So what happened is, and it was again, this mindset, how do we keep our people busy? You know, we aren't getting the orders anymore for what we do, our castings and those things we do. But Hey, we have these 3D printers. So they focused on the 3D printing, the 3D printing that would save companies money, 3D printing auto parts. And that's one thing they did. So that excelled, and then you were able to stay with their long term goals and accelerate in the areas that they would've never thought they could move forward in. So once again, that's resilience, something happens. You're losing business. Now you're bouncing back. You're being creative. Now you're actually building mountains, not climbing them and offering services to organizations or services to other manufacturing plants, et cetera, even to the extent of winning this manufacturer award, it's quite a story. And they also kept all their employeesNeha:That was a tough nut to crack for many, many small businesses. Right. So that's really, and you brought up, entrepreneurs. I also wanted to talk to you about intrepreneurs. So people who are within a company. And, connect that to your concept of creative preferences that you talk about in your report. Yeah, so my question was, how can leaders make sure that they're leveraging these different styles, but at the same time also building cohesive teams in their organizations.Marsha:Yeah. There is an excellent theory about creativity that we all have our preferences. And I hope this resonates with the audience because it's perfect for building teams and working within an organization. You could might need to create a new process. You might be able need to create a new product accountants and finance people might be asked to create new dashboards, new systems, make recommendations. And so this technique has four parts to it. Or this study, this from the research says there are people that are clarifiers, ideators, developers, and implementers. And so let me talk about each one. And maybe you can identify with one, you, the people in the audience. So clarifiers are people who ask lots of questions. They cannot move forward until they know what's going on. And sometimes they slow things down, but they want the facts and they're stressed. They, they are still stressed. If they do not get this information. Now there's another group of people they're called ideators. They just love to brainstorm. They don't care about anything. They don't need clarification. Just tell me what you want. And they'll brainstorm and they'll go hours. And they have joy and they just love it. And they can, they don't care if they have direction, no direction. They're those people that are always throwing out these ideas and they annoy some people.Neha:You call it extreme brainstorming, right?Marsha:It's extreme brainstorming. You know, I'm one of those people and other people get annoyed, but let these people brainstorm this is what they're actually good at. And they love it. And then we have these people called developers. They're the people that evaluate the ideas. They're always there evaluating, no, we can't do this. These are the pros. These are cons. You know, this is, you know, this isn't realistic. This is what we need to make feasible, et cetera, et cetera. So these people are excellent at this stage, but you don't want these people saying things during a brainstorming stage because that just shuts it all down. You know, they're just like, Hey, wait a minute. No, we heard that. We tried that. And you hear that in meetings. And it just, you know, the brain and then your ideators get all frustrated.Marsha:And so developers just keep your mouth shut and you'll get your chance. These ideators, they don't wanna develop. They just like ideas. And then you have the implementers. They're the people that just wanna do. They're like, just stop, you know, you let's, let's just do a survey. Let's just do this. Let's just do that enough for this. Let's get a plan. OK. So those people just wanna do action. When I was a teacher, I have a story, a funny story. I had a student, I said, okay, we're gonna do this interview assignment. He came back next time, like "Dr. Huber, I'm finished". I'm like, I didn't give you instructions. You know? I'm like, how could you do the assignment when I gave you nothing about it, he said, it was an interview assignment. I did an interview. I'm like, OK, that's an implementor, you know, they wanna do, they wanna do action.Marsha:So if you understand this process, you know, you don't want people implementing things that they'll just do anything. You know, they wanna go, go, go. So you need these clarifiers. And if you can identify those people, they will figure it out, gather the data and they can hand it off to someone else. They can still be on the team, but they have to understand when they hand it off, the ideators will go with it. And then you can have all, you should have all these people on your team, but the developers need to hold their tongue and not be throwing in all these bombs. You know, just let them go and participate. Because when ideas go, usually it takes three rounds of ideas to get very unique ideas. Because a lot of time brainstorming meanings, it's all the ideas we have, and it's nothing new.Marsha:And so you've got to, you know, let the people, you know, do this first round of all the ideas in people's heads to clear 'em out, then you do another round and you might have to use certain practices to get people thinking. And then it's a little awkward, but then you get to the third round. And that's a lot of times where the good ideas come from and then hand off to developers, you know, figure out the good ideas, what developers that work with it, pros, cons. How do we, you know, who do we need to help with this, that this, and then hand off the implementers, they'll run and do it. So this is how you build a really great team research supports it, it's been used in, I would say thousands of companies. There's people who can lead these meetings. And we all have our preferences. Sometimes we have more than one. Sometimes we need what they call integrators. They actually can work in any preference and help move the group along. And you often need training in this and it's, and there's a company that actually this called foresight. If you can't figure out where you're at, you answer some questions and, you know, they'll give you, you know, say, oh, I'm an ideator-implementer. I have ideas. and I do it.Neha:Wow. And you can make the best use of every team member you have. And everybody feels like they have contributed to the whole process.Marsha:Right. And you understand the other people, you know, you understand this is a process and if you're an implementer, I just have to wait or I'll show up at the end, you know, just gimme what to do and I'll do it. But I don't wanna be part of this whole thing, but usually people enjoy the whole process because you can do this process in a few hours. So it's not like days and days and days. A lot of these sessions can be done in about two hours. And so, and people can participate and understand and use the benefits and the talents and the preferences of every person there. And it's really nice for building teams. I mean, the teams' cohesiveness. And I found that when I work with people and you know, you can use this among your own teams. I work with writers and I understand what the skills, talents, preferences of other people on my writing teams are. And I'm like, OK, okay. I turn it over to you. OK. We're here. And they do their thing. Cause I'm not a developer and I'm terrible at it. And I'll never become good at it, it's just not my thing, I don't like doing it. So why should I even become good?Marsha:I mean, seriously? But I do try to think a little bit more pros and cons. And, but you know, some people are great these different areas and they can develop that skillset.Neha:That's fantastic. Thank you for walking us through what it looks like and giving us great examples. Now, I think we have time for one final question. I really, really enjoyed reading the report and I want every listener to download the report right away and read it. Now, I want you to give us a really compelling reason why they should do it as soon as possible.Marsha:Now I think if you download the report and read it, you will get something out that will change your life. There's bits of I would call, there's gems of knowledge in this report. And I don't know what you need at the moment. Maybe you just need recharging or maybe you need, Hey, we need to move a process ahead. And how might we do this? Or you might just understand something about yourself and how you can contribute to your company better. Or if you are a leader, you might say, you know what let's really think about before we go ahead and, you know, deal with a problem. Let's spend a little time just reimagining what we might do. So I think there's something for everyone, whether it's for your business, your team, or even yourself. I mean, I'll be honest. I live by these principles myself and I use them all the time and I was very happy to share them in a report as well.Neha:Cool. Thank you so much, Marsha. And yes, I leave the link to the report right there in the notes for the episode. So all you listeners can go and download it right away. Keep it next to you as you listen to this, it'll be the most helpful way to get the most outta Marsha's conversation today. And it brings us to the end of our conversation today. Thank you so much for being on the show and sharing your insights with us, Dr. Marsha Huber,Marsha:Thank you for inviting me.Outro:This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Connect with AnthonyFull Episode Transcript:Adam:I'm Adam Larson and welcome back to Count Me In, the podcast by and for management accountants. Today's guest comes to us from the forefront of the data automation revolution. Anthony Nitsos, a proud CMA, a consulting CFO, and the founder of SAS gurus shares the unique story of how he transitioned from pursuing a career in medicine to how he discovered the power and beauty of accounting. From explaining how accounting forms the spinal column of any manufacturing business to practical advice for writing the coming tidal wave of financial automation, Anthony's insight and expertise is important listening for management accountants everywhere. Enjoy the show.Adam:Anthony, thank you so much for coming on the podcast today. We're really excited to have you on and today we're gonna be focusing in on automation and what that means for the management accountant. But to start off, I wanted you to kind of tell us a little bit about your story.Anthony:So thank you, Adam for that. And I really appreciate being on your program today. You know, I've had an association with the IMA for a long time, which we uncovered in our kind of a preliminary, so that'll be part of the story. But I actually started off in medicine of all things. I was accepted into an accelerated program at the university of Michigan at the age of 18, but several years into it, I realized I really did not want to be a doctor. So it was one of those kind of all right, well you're most of the way to a doctor and you've kind of got a bachelor's degree to show up for, but what are you gonna do with your life now if you've decided not to go in medicine. So I think by, you know, stint to the fact that they both started with am, I went into manufacturing right after medicine.Anthony:I don't know if it was anything more than that, just like, okay, I need a job. I need to, you know, make money. But the strange thing is, is what they had me do was really, you know, kind of the beginnings of process reengineering analysis and trying to figure out why in this particular case, you know, logistics were breaking down material, wasn't ending up where it went. So I got kind of a baptism in fire. What it showed me was that corporations are very similar to bodies. You know, they even, you know, means the same thing. So this training that I got in medicine actually translated pretty well into manufacturing. And so there, I, you know, from there I took off. After that, I did a stint where I was doing a lot of ERP implementations. If folks recall back around the year, 1997, everybody started panicking that their code would blow up when the year 2000 showed up.Anthony:So there was this huge, you know, Y2K, doomsday disasters, et cetera, et cetera. And at that time I was picking up accounting skills. It was one of those things where it was pretty clear that the impact of manufacturing was absolutely a financial one in that, you know, when you got right down to it, you're making decisions on the shop floor that impact profitability. So it was kind of a natural progression for me to just kind of move over into more of an accounting type of world. And ERP really brought that together, cuz that's where you really unify back then still in today, you know, the operations of the company with finance. And so that's where the accounting management accounting piece came into it. And it was right around 1996 where I actually got my first certification in accounting and it was the CMA.Anthony:And I remember that being really useful to me and still to this day, I'm not gonna say it really stopped being useful because whereas the CPA exam and I've taken that, and you know, I've also passed that and I'm also a CPA, but I became a CPA later. I was a CMA first because CMA was very broad based. And from my training, you can't look at one part of a body anymore than you can look at one part of a corporation it's an integrated systemic whole. And so how those pieces work together and how they work most efficiently together, the principles are very similar between medicine and, you know, process reengineering. They really are, you know, you go after the root cause the idea of medicine is not to treat symptoms. I know there's a big debate about that, but really what we are trained to do is find the root cause and fix it.Anthony:And manufacturing is no different and neither is IT. So moving from the physical body to the physical manufacturing now to a more, you know, electronic realm, bringing ERP and all the systems and how they touch everybody together and unifying that ultimately in a framework, which was based in accounting in my mind, because in my mind, the accounting pieces, like the spinal column of the body, you really build everything off of that. All of your reporting, all of your metrics comes off of that. And so focusing the attention to get to the numbers most accurately, most efficiently really became kind of the focus of my next position, which was a controller for a Japanese company. It was a company that was a manufacturing company that had been purchased by, was an English company that had been purchased by the Japanese, excuse me and the president at the time really wanted to have his own money guy rather than have somebody from Japan come in and do the numbers.Anthony:And so he quickly moved to hire a new controller and that was me. And so at that point we knew we were going to scale the company 10 times within the next three years. And so my experience in accounting, the fact that I also spoke Japanese, cuz I had actually studied there, helped out, I understood the cultural kind of the, you know, became kind of like the cultural liaison with the Japanese people when they showed up and then going over there. But that was kind of a side issue. The big issue was they gave me opportunity in a Greenfield implementation to design the entire data collection, information, reporting, financial reporting and whatnot for what was going to be a $50 million company that I had inherited at 5 million using Peachtree. So here I am, freshly minted CMA got his first controller job, applying all these skills and saying, okay, we now get to design a data collection piece for all the production data, all the manufacturing data, all the material data, all the labor, blah, blah, blah, in a way where we really kept the cost down.Anthony:So this was my first and in some ways, best experience scaling a company because I was actually given that power. I was given the authority to basically design the system. And so we had at the time when we started that 5 million, there was myself, a full-time accountant and kind of a half-time payroll person running, you know, the entire back office. When we reached 50 million, I had the same three people, only the payroll person was now full-time. And so we were able to, by applying Japanese manufacturing principles and techniques of totally total quality management, plus Six Sigma black belt process, reengineering analysis, plus my training in ERP systems and what could be done. And at that point, the state of automation was you drove everything off of barcode scanners. And so once everything was set up easily, so each person had their own badge, their own employee badge.Anthony:That was what they used to swipe in and out of the clocks and also what they were used to swipe in and out of jobs. And we made it easy for them to do that. We had readers everywhere and the jobs themselves had their own codes. And so all you had to do is just match the two up in a system and boom outfalls the data. So it was the principle of a single point of data entry, which was the scanners. Poka-yoke, which in Japanese basically means idiot proof, makes it full proof. So you can't make a mistake. So there's no typing in of job numbers. There's no typing in of labor numbers, it's all being scanned, right? And so by being able to do that, you could then control literally every piece of data coming into the system in a high quality manner, that easily attained Six Sigma and beyond in terms of accuracy. And, you know, basically made lives easier so that data was producible and allowed the organization to scale because you can, now, all you're doing is just turning up the volume to 11 on a system, that's able to handle it. And so kind of in a journey that that's where I ended up in the early 2000's is at that point in my life is having achieved, you know, this level of, you know, automation and sophistication in a very real world sampleAdam:That's, that's quite a story. And you know, the fact that 20 years ago that level of automation you were able to accomplish and now fast forward to now, you know, automation is everything. People are talking about it. They're talking about RPA, they're talking about AI coming and doing all these things and helping out the finance function has anything really changed from automation in, you know, 20 years ago to now the fact that, you know, since, you know, you've been doing it for so long, what, what has changed and has it changed really? Or what is the same?Anthony:Well, okay, so it has changed and it is somewhat, and is also the same. It's the same, I think from basic principles, right? The basic principle of a single point of data entry data creation is the point of greatest impact of quality. So you get the data in, right the first time that principle hasn't changed. You know, going to, you know, applying, you know, the hierarchy of controls where prevention comes before detection comes before correction and keeping that firmly in mind when you're designing that you can take basically a system in manufacturing, Six Sigma at the time was considered to be state of the art. You had quality at, you know, 99.99966%, whatever it was, that was the three sigmas off the mean, you know, so you're basically three parts per million. Well, in a computer system, there's no such thing as three parts per million failure.Anthony:If we had a three parts per million failure in a computer system, you know, there would be havoc, all right. It would be chaos. In a computer system it's effectively a hundred percent. So you go from Six Sigma to infinite Sigma, if you will. And that's a level of quality that you simply can't attain in a manufacturing in a real world setting, not yet with our current state of technology, there's science fiction about how that, you know, nanotechnology might change all that, but we're not there yet, but in a computer system you can make it pretty well, a hundred percent accurate. And from a quality control standpoint, you're not applying the principles differently. You're going from single point of data entry, make it correct upfront. So preventive type of mechanism. So you can't, so you idiot proof it, you poka-yoke it.Anthony:And voila, you end up with systems that are now much faster at taking in vast amounts more of data, but what you do with it is now the different part, right? And the methods that the data are delivered are different, you know, 20 years ago, having an on-premise solution of your own servers with your own installed ERP system that you paid a license for one time, and then maybe you had a, you know, an ongoing maintenance agreement, but you know, the software was yours effectively. We are now in a different world. Well, different only in probably I think methodology, but not in what I call paradigm basics. Okay. So the server is now called Amazon web server and, or Azure or whatever you happen to be using, but there's still a box sitting somewhere that's crunching numbers.Anthony:It's just not yours anymore. All right. So, and then the application, in this case, you're not buying an ER, you know, you're not buying a license to, you know, JD Edwards or Bon or whatever it is. You're now subscribing to NetSuite and intact, and you're paying an ongoing, you know, fee for that. Well, that's still software only in where it's really paid off, of course, is that you, your own organization doesn't have a huge IT bloated infrastructure to support all that on premise type of activity. So in terms of, again, that just makes things more productive. I now, you know, just how it's impacted me as a, you know, a fractional CFO, if you will, you know, finance expert and a process re-engineer is I can serve 30 or 40 clients from my desktop, directly. Right. And as I multiply that with the other people in my organization that reaches many more, but in terms of, let's say my direct clients that I deal with, I can easily handle 30.Anthony:Well that's only because I can access every one of their accounting systems online at will easily. Data's immediately available that everything is structured in a way to make it efficient. So, you know, the way you put the tools together now is the same way, right back then we were using barcode scanners, using barcodes, collecting over, you know, network, hard wire into a server that was then, you know, you know, step all the way through it. Those steps are effectively the same, but it's now you have more flexibility in which you can plug and play together. So that's changed. So the breadth of things that are available to us as, you know, financial professionals, you know, and accounting professionals is much broader and richer than, you know, we had Peachtree and QuickBooks. That was pretty much it. Or you spent $5 million to go to an ERP system because you had to buy this huge, you know, IT, so there was like this tiny little piece that you could, everybody kind of fought and made things work in.Anthony:And then there was this huge leap up. Well, there's nothing in that middle real estate. Well, there's a lot of stuff in that middle real estate now. So it makes available to, you know, another thing that's changed is the size of the companies now that can access these kinds of automation tools, it's much smaller than it was in the past. You know, we were a large-ish manufacturing company, a conglomerate, we were one plant of like 20 in North America and then worldwide, you know, 1500, right? So we had capital available to us so we could buy these systems, even though we were too small for it. But back then a company that was $5 million in revenue on its own good luck trying to get the money to, you know, invest in something like that. Today, I can go subscribe to QuickBooks. I can subscribe to HubSpot or nutshell if I want a really cheaper version, I can go out and there's so much available in what we call the SMB, the small and medium business market available to us that now it's kind of taking the knowhow of putting those together in a way that's most efficient for, let's say an industry.Anthony:And that's, that's where we focus our attention. We're, you know, very focused on SaaS companies and setting up their infrastructure, using all these tools and all this past practice to come up with a really, even today, the most efficient way of delivering numbers. So the goal's not any different. Turning raw data into useful information, right? That's what we do as management accounts. That is our primary function in life is to translate, you know, what's happening in the real world into something that makes sense for executives on a financial basis. Let's say it's all, you know, it is about the money, right, but mixed dashboards too. And that's where the breadth of the IMA education, you know, comes into it. The CMA education is that you're across multiple areas of the organization, looking at the whole theme systemically. And that's what it takes to put data systems together. Now to the point of AI and where this all fits in, in machine learning.Anthony:Even now, QuickBooks is, you know, first we started off with rules, right? Where you could classify transactions as they came in using rules. Now it suggests rules. And if you turn on their more advanced feature, it will actually just do it for you, create the rules. And then, you know, you can go in and check later. So they're, they're involving their machine learning capabilities inside of the accounting system. Accounting in particular is a very rules based, you know, practice, right? We have GAAP, we have, you know, practices, ways of doing things. And it's so it's, and it's also, you know, very structured, right? Because it's structured around this chart of accounts thing, which goes back five centuries. So it's a robust system if it's lasted that long. Right. Well, that also means it's subject to machine learning because anything that can be really systematized that's structured can then be replaced by faster what are called heuristic self-learning systems.Anthony:And that's what these things are. So whether you call 'em machine learning, ML or AI, what it is is as it has been all along computers, doing things faster than people, and the faster is now changing into not just the repetitive tests, but the non-repetitive stuff. Oxford University, I think it was, or one was one of the major universities in England and I can't remember, but Oxford is the one that sticks in my mind did a study back and this was in 2005, 2006, if I recall, and they were taking trends of automation at the time and applying, you know, various analyses to different industries and said, you know, by the year 2050, this was the headline, by the year 2050 half of all jobs in the UA would be automated out of existence. But if you read the paper, they were actually, you know, they weren't being alarmist about, they're just saying, look, that's not to say they won't be replaced by something else.Anthony:But right now, based on automation trends, these jobs are likely to be automated out of existence and humans won't do them. When you go back to my example of automating the Greenfield manufacturing, we were doing everything by barcode scanner. Well, in the past, there would be people writing numbers on things, right? So you're just replacing people. And that's what the power of SaaS is nowadays. And all of this is that ultimately what you're doing is you're replacing people with tools that can do the jobs that they did for lower cost. And so you're trading off people in their jobs. You know, this is the human element for automation. So the drive to, you know, increase profits to gain market share to gain efficiency is all driven ultimately by in many ways lowering cost and increasing sales. What we do on the IMA side, the CMA side of things is we control that cost piece.Anthony:We're not really, you know, we're out there selling that. We didn't, go into sales. That's why we're in accounting and finance, right? And so the long and short of it is, you know, you can use these tools, but, you know, keep in mind that what you're doing is you are automating out of existence, you know, somebody's job. And in the top 10 jobs in this study, accounting was like number seven at threat for automation. And it makes total sense. It's a very structured, yes, I know GAAP opens up, you know, alternatives, but you know, if an AI can be taught how to beat the world's champions at chess, I think it probably can be taught to figure out what the, you know, the best GAAP solution is for a particular circumstance. How close are we to that? I don't know. I mean, it's probably not as far away as we'd like to think, to be comfortable. Yeah. I think it's coming in that as accountants, we should be aware of the fact that we've got kind of a choice. We can ride that tidal wave or we can be, you know, drowned underneath it, but the tidal wave is gonna come.Adam:Yeah, it definitely is with, I mean, the rise of, and I'll say software as a service or SaaS as you've been referring to it's definitely taken over. And I know that there's been lots of papers written and then lots of articles and the things you've mentioned about how that it is taking away jobs, but you know, there, so there are big issues coming for the accounting and finance team as we do go to things like SaaS, softwares and programs to help automate our systems, it makes us become more efficient. And as long as the data going into that is accurate, all the rest of the stuff should be accurate. So what can the accounting and finance do? What are the issues that they are facing as they go into this world of trying to ride the wave instead of being drowned under it?Anthony:Well, it's, it's, first of all, you need to learn how to swim, right. You know, to extend the analogy. And in this case means you need to get up to speed and up to date on what is out there, you know, and there are a lot of resources out there to tell you, you know, what's the best. So that's kind of number one. Number two, and this has been something that I liked about the messaging of the IMA and still do to this day is that there isn't really a decision anywhere in the organization that doesn't have a financial impact. Therefore, you know, we can legitimately look outside of our areas for opportunities to save in the bottom line, and that could be finding a tool. So I would rather be the one out there finding the tools than somebody finding them and replacing me with a tool they found.Anthony:So number one is to learn how to swim. Number two is to swim. You've gotta be moving forward. If you think that your let's say you're in an organization and been doing the same things over and over again, and it's resistant to change, well, it could be that your organization itself is at threat because any organization that doesn't adapt to changing environmental circumstances is, you know, a Darwinian evolution. You know, if you don't adapt, you basically don't survive. And the world is changing. So to me, it's, you know, learn what's out there, they're available tools. You can just start with a Google search, like automation tools for accounting, and just start reading, you know, it'll come at you. It's not difficult. It's scary is what it is. I mean, it's frightening to think about the fact that the, you know, the livelihood that you've been relying on for years might be a threat of being automated.Anthony:The reality is that that step isn't too far off of reality, or that view isn't too far off of reality. And so you should be reacting accordingly. And with anything that involves, say a threat to your financial security, or, you know, whatnot, or a risk to your financial security, you know, we gotta mitigate it. And that means learning. That means opening yourself up to new ways of doing things, even if it seems really strange and radical. Here's an example. This one I went through was a great, you know, great experience for me. So I came from the world of Microsoft, right? Everybody in accounting, you know, all of it in accounting is on windows machines. It's like, that's just the way it is. It's Excel. It's QuickBooks on, you know, for windows, it's, you know, Outlook it's, you know, all that stuff, word cetera.Anthony:Then there's this whole other universe out there that's called G suite, which does all the same things. And so when I went, so what happens, I'd been doing fractional accounting, financial controller, CFO work since about 2006 that's when I went independent, actually partnered up with somebody and been doing that mostly since, except there was a period of four years in there where I was actually an employee. And I went back to being employed because it was my second scaling opportunity. And this time was now how to scale an organization, 10 times revenue in three years. But instead of being manufacturing, it was software. And there was no way I was in charge of everything because I was coming into a system that was already set up. It was basically, how do you, how do you fix the mess that's already there. But in that particular period of time, you know, that's where the learning how to adapt existing systems.Anthony:And suddenly what's out, there was this G thing. And they said, oh, you don't have a Windows machine. Here's your MacBook. Oh. And by the way, what's out, we don't do any Microsoft products here at all. We're a security company, their security is too weak. Right. I went to work for a cybersecurity company, right? So the CFO hired me to build his entire back office, which was what I had done before. Only instead of doing it fractionally, I basically needed to become, you know, salaried again, cuz this was a full time gig. And we did it in three and a half years. We scaled the company from 13 to 130 million in revenue. And we did it just basically by having a great product, but it was security. So they, they gave me this MacBook and said, you don't get Outlook. You don't get Office anymore.Anthony:That doesn't exist here. Here's your G suite account. And I was like, what? I mean, I was like, oh my God. But after three months I had so come totally around. So here's where, you know, I'm using an example. I was afraid to learn a new system, even though it was coming down, the job that I came in. So it's all right, well, you're gonna have to learn this. You can hate it or you can learn it and learn it I did. And I learned to love it and not because it, I had to learn to love it because it was better. And it was better because where Microsoft had created all these silo products before and was trying to knit them together in a, you know, kind of an internet based, cloud-based environment, G suite from the beginning was designed that way. And so as a collaboration tool, it is far superior to anything that teams or one SharePoint or whatever can offer.Anthony:And so that's why most of the tech companies I work with now are now G suite houses. I have one or two that are Outlook and because it knits together so easily, that's why I can serve those 30 clients. They're all on G. And so the ability to collaborate multiplicatively has greatly increased. Why? Because I learned how to swim. I was thrown in the water. I had no choice, but now I really embrace it. And you know, we're on, we're on the lookout constantly. So, you know, I've heard, maybe you've heard of bill.com. You have folks using bill.com or Expensify or Concur. There's a system out there now that knits all that together, that's free, and comes with a corporate credit card. And suddenly your automation increases dramatically and your cost go down, but you're gonna replace anybody who's managing the Expensify instance. And you're going to cut down on the people who are modifying, you know, in using the bill.com instance, you have to be willing to face those kinds of choices.Anthony:Again, the human element, accounting is not numbers. It's also people and there are people behind it. And that goes all the way back to my medical training. These are human beings. And first and foremost, all along every organization is composed of us and having a good, fun job to do and not worrying about the, you know, headsman's axe is something that, you know, we want, but you have to be aware that you are in an industry right now that is subject to automation and you should be learning how to embrace and use those tools, not resist it.Outro:This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Connect with LeahWorkman ForensicsFull Episode TranscriptAdam:Welcome to Count Me In, the podcast that explores the world of business from a management accountants perspective. My cohost Rouba Zeidan spoke with our special guest Leah Wietholter. Leah is a certified fraud examiner and the author of the new book Data Sleuth: Using Data in Forensic Accounting Engagements and Fraud Investigations. Leah began her career supporting forensic accountants at the FBI and has since branched out to lead her own forensic accounting and private investigation firm. Forensic investigations are the center of so many great crime shows these days, and it was exciting to hear how accountants expose fraud and other problems lurking in bank accounts, credit card statements, and payroll reports. I hope you enjoy the conversation.Rouba:Good morning, Leah. And thank you so much for joining us.Leah:Thank you so much for having me.Rouba:I'm really looking forward to learning more about your very kind of interesting arena and industry, which is and you have a wonderful background in the FBI. So maybe you can drop in some examples on that part of it. So can you tell us a little bit about forensic accounting and forensic accounting engagement? What does it entail?Leah:Yeah, so I work forensic accounting engagements as a private consultant. So I'm not affiliated with law enforcement or anything like that. I own a forensic accounting practice in Oklahoma, and the majority of our engagements are solving some sort of financial problem that's either in litigation or could end up in litigation. So we work a lot of embezzlement investigations or fraud investigations. Then we also work to help sort through partnership dispute or a shareholder dispute, so if someone believes the general partner or whoever's managing the money, usually, has been taking more than their fair share, we get involved there and kind of our third other largest category of a forensic accounting engagement is in divorce matters when the two parties are looking to get divorced and they need to split their assets. Then usually one party is not familiar with how the marital funds were handled.Leah:And so they wanna make sure that when they go to divide those assets, that they're getting their fair share. So we help them either get comfortable with the known assets or try to find any other hidden assets within that situation. And we usually only work divorce cases. If there's a business involved, there's a lot of opportunities when people have closely held businesses where they can hide assets or just, they own things that maybe their spouse doesn't know about. So those are kind of the three types of engagements that fall under the three types of cases that are typically involved in a forensic accounting engagement for us.Rouba:Interesting. I mean, that, that kind of implies that there are numerous kind of legal consequences and circumstances you know, that might come into the equation and most well known would be maybe investigating alleged fraudulent activities like you, you know, in your experience, how prepared is the average finance and accounting professional to handle such circumstances?Leah:I would say that the accounting and financial professionals that I run into, they're familiar with what fraud looks like. They're familiar with, you know, the concept of, we talk about this a lot, cuz we use data analytics, but a lot in our investigations, but we talk about what should have happened, the framework what should have happened versus what happened. And so finance and accounting professionals know what should have happened. And then they also know what happened, but taking that information and then putting it in a format that could be explained to a judge or a jury or even to the client themselves is where our specialty usually shows up. As opposed to, you know, maybe someone working in corporate or even in audit connecting those dots. One of the things that I've been focusing on lately with my team is, okay, I understand that these journal entries, for example, these journal entries look strange and we can tell the client, Hey, these journal entries look strange, but we need to tell them why that matters.Leah:Why should they care about it? And what is the risk to them? What is the financial loss to them? And being able to connect what we know about accounting to losses, to the story of what happened, because that's what helps in, if it does result in litigation, that's what helps communicate the findings. So we've gotta be able to connect what we know as financial professionals with a group of individuals that this is not their specialty. And so connecting those dots, understanding a lot of times finance and accounting professionals are very good at understanding what all the financial statements say and what that means, but then to translate that into, okay, why should my client care, which is usually connected to what actual dollars are missing which would be found on bank statements and credit card statements and payroll reports. So just knowing where to go for that information to best communicate what happened. And the corresponding loss is kind of where this forensic accounting niche comes into play.Rouba:Did you find that the need for forensic accounting has grown over the past few years and more specifically, you know, post the COVID era? And if so, how and why?Leah:So when I first started in forensic, so my background, I worked for two years with the FBI under the direction of a forensic accountant. And that's how I got into this niche so early in life. But then when I joined I started doing this from the private sector. It wasn't as popular and that would've been like 2009. It, it was becoming more popular. The more that technology has advanced and the access that we have that keeps growing to different kinds of data and understanding what that data can tell us. And you know, how we can use that to understand what's happening and just to understand and put our arms around those facts. Then I think forensic accounting is becoming more popular in the private sector. And I haven't really noticed a huge increase in the need of forensic accounting.Leah:I think a lot of people after COVID, I tell my team, I think people are just mad at each other. So we have a whole lot more like the volume of partnership disputes is so much greater than it was before. We're starting to see an uptick in divorces as well. So I don't really know that COVID affected how much forensic accounting or, you know, increased that need. But I have seen an increase in over the course of the last 12 years or 15 years of my career in that, because there's so much more information readily available, that it is possible to find out what happened without relying on law enforcement to get involved and law enforcement, especially in the US, they already have too much work as it is. So if people want answers to their questions and they want it timely, then I think the best resource for them is a forensic accountant in financial investigations.Leah:So that's what I have kind of noticed in, you know, this basically has consumed my entire career, this field. And so just noticing the trends that way, you know, and like I said, COVID, I don't know that it increased the need for forensic accounting. It's just that there seem to be even more disputes since COVID. And so then that means that there's a lot more volume for not just forensic accountants, but I like to stay connected with the investigation community as a whole private investigators and other consultants. And even they have seen a huge increase in their caseloads as well since COVID.Rouba:And I mean, which kind of institutes or agencies make the most use of forensic accounting, your experience.Leah:From a law enforcement perspective, I typically work with the FBI and the IRS criminal division, but there are forensic accounting positions within all types of investigative agencies. I mean, kind of what we're seeing in the US as a whole is just that there's a shortage of individuals and the same is true in the forensic accounting field, especially within law enforcement agencies, I've recently learned, but I think other industries that aren't law enforcement we're definitely seeing in public accounting firms, public accounting firms are, have been adding and are adding forensic accounting divisions where they didn't necessarily have them before or they'll have a litigation support division that does business valuation. But then since they're already involved in these legal matters from a valuation standpoint, then they're often asked, you know, oh, Hey, could you also do this forensic accounting engagement or this fraud investigation? So that's definitely becoming more popular.Rouba:And are you seeing an increase in forensic accounting for compliance purposes?Leah:I think that there is an interest in using forensic accounting to - let me say it this way. So I don't deal with compliance specifically, but knowing how forensic accounting solves so many problems for our clients, you know, we're able to tell them, they'll say I'm worried someone's stealing money from me. So we're able to investigate and identify, okay, was this individual stealing money? And you know, what is the best evidence to base this on? And then what is the loss? So those same procedures that we use can be used in compliance as well. I don't know how many people are actually applying them, but I know based on attendance and interest in what I do, there are a lot of people in compliance or internal audit who are looking to implement, or at least understand these approaches, if and when they run across things that look strange. But I do think that when an investigation or forensic accounting engagement or process is based on data and understanding what that data tells us, then I think it can be applied as part of audit or compliance or investigation.Rouba:I mean, you say data and we're in a highly digitized era, what is the role of that data and technology within forensic accounting engagement, especially like you said, it's grown in kinds of it's grown the capacity and the capabilities of forensic accounting globally.Leah:Yeah. So from a forensic accounting or fraud specifically fraud investigation - well I guess both - standpoint, I use the word data because that's the simplest thing to kind of address, but really it boils down to the primary, just the best evidence. So there's two different kinds of data. And I actually talk about this in my book. So there's two different kinds of data. There's qualitative data and there's quantitative data in forensic accounting and fraud investigations. So our quantitative data is typically looking at, and I have kind of two categories for this as well. We have our most reliable evidence that would be when we're talking about, I'm always trying to find some sort of missing money. So I need to identify how did the subject increase their purchasing power. So a journal entry doesn't tell me, how did this person steal money? A journal entry doesn't tell me how much money was stolen, because that's not necessarily reflective of the cash leaving the bank account or overpayment of payroll, or even theft of inventory, a journal entry or accounting records that provides me with the context that gives me the story, but that doesn't necessarily quantify the loss.Leah:A loss is actually quantified by, and these are so simple because so to call it data, I think makes it sound a little scarier than it is. It's really just looking at bank statements, credit card statements, or payroll reports for most companies. In larger companies, it could look a little different because there are more internal controls. And so we can rely more on the company's accounting information, but most companies don't have the internal control setup to make their records reliable. So we just go to the source themselves, bank statements, credit card statements, payroll reports, everything else is used contextually that's part of our quantitative data. Our qualitative data also helps build that story and the most common, or I think the thing that's most expected in our field is trying to find any sort of emails or notes or files.Leah:I will tell you that in the majority of the cases that I've worked and I've worked close to 200 cases in my career emails, you know, people will say there has to be a spreadsheet somewhere emails or something where they confess to doing this or text messages. I wish. That's not really the case in my sample of cases that I've worked in my life. That is not, that is not proven true. But when I'm talking about data, I'm really talking about bank statements, credit card statements, and payroll reports.Rouba:And I mean, how can, because obviously data is so full of insights. How can that be used proactively to kind of inform you know, future kind of preventative measures. So, and then how can finance and accounting professionals actually harness the power of that data to kind of prevent fraud within companies and use that, you know, that data, as we said to inform.Leah:Yeah. So on a kind of broader, bigger picture, when I'm talking about fraud prevention, I like to talk about fraud prevention from the perspective of, I need to understand how does money come into my organization and how does money leave my organization then within both of those categories, I then start looking at who handles actual cash or assets that could be stolen. So we're just gonna focus on cash for the purpose of this example. So I need to look at what types of payments does my company or organization actually receive. And that could be cash, check, credit card, wire, ACH, whatever, but I need to identify all of those. Then I need to identify who are all the people that touch it when it comes in, who reconciles it. And then I need to look at if someone was to steal money, as it's coming into the organization, where would they do this?Leah:And then I need to identify if they were to do these things, then what data do I have at my disposal that would tell me that this is happening. So, and then I do the same thing, looking at how the money leaves the organization, what are all the different things that we pay? How do we pay those things? Check, credit card, ACH, wire. I mean, it's the same thing. How do I do that? And identify who touches that? Who actually initiates it, sends it. I mean, you know, things that probably a lot of finance and accounting professionals are used to, but then ask ourselves in relation to who authorizes it and all of that, and I'm not looking at it from an internal control standpoint, trying to evaluate controls. I'm trying to evaluate the opportunity at each of these types of payments.Leah:So then if I've identified, these are the people, and then these are the opportunities they would have to steal. Then I go a step further and say, so what data do I have available that if I looked at this data, it would tell me that money was missing. And a really simple example of this is if I am looking at payroll and I go through all those steps, we just talked about for payroll. And at the end, I've identified that someone could be overpaying themselves, like maybe they're inflating their hours or something, or maybe they're paying themselves salary greater than what was agreed upon. Then the data at the end is as simple as how much did they get paid? So I would need a payroll report. I would need maybe several payroll reports, and then I would need an employment agreement or contract or whatever it is that would tell me how much this individual's being paid.Leah:And in working through this process, if money is missing those two things, aren't going to match up, you know, if somebody's stealing money, but what this process does. And I realize it's pretty detailed, the larger the organization is, but by doing this, it identifies where do I have gaps in data? Do I even have employment agreements for everyone? If someone suspected someone was stealing out of payroll, do I have enough documentation to even see, to even answer that question? And that's what we've actually found with large and small organizations alike, but it's more surprising in large organizations when we go in to work a fraud investigation and we start saying, okay, well, in order to address all of these concerns that you have, we're going to need access to this, this, and this. Well, when they take that list back to their team, we will find out from them later, oh, we actually don't have reports that will tell us this information.Leah:And so from a preventative standpoint, if you know that you have these data gaps, then, and you might think I'm a pessimist by my next statement, but it's just the nature of my work, but I don't think that we can prevent a hundred percent of fraud, especially occupational fraud. I think the goal is to detect it quickly. So because the longer a scheme goes on the greater the loss and absolutely potentially more damaging to an organization. So if we can identify those data gaps and we're using that data on an ongoing basis to say, okay, it's payroll, what we expect, or, you know, expenditures is what we expect is inventory what we expect. Then as we do, if we run into issues, at least we know that we have this data we can use to quantify any losses, or if there's discrepancies kind of find out, is it an error or is someone actually stealing money and start making that determination. But if the data isn't being collected or the data isn't readily accessible, because sometimes it's just a conversation with IT. Sometimes it's, oh yeah, we should have audit logs. That's something that our accounting software does, but nobody's ever turned them on. And so that will even be in large organizations and even small organizations. So identifying that on the front end will always set up any type of investigation into any type of discrepancy and, you know, set up that investigation to win.Rouba:Brilliant. I mean I, I definitely wanna know more and I think one of the dives I'm going to do is into your book, Data Sleuth. I mean, if you can tell us more about your book, which talks about using data in forensic accounting, engagements and fraud investigations.Leah:Yeah. So I had the opportunity, so I started this practice. My practice, it'll be 12 years in November, and I started as a sole proprietor. I just was gonna work a few little cases. I was tired of public accounting. And then I ended up getting really busy really quickly. And that was something I didn't plan. And so several years into my business, I was kind of facing either burnout or I had to figure out how to scale what I was doing so that we, so that I could help more people. And you know, trying to give a team information that I had gathered from years of experience was just very, very complicated and for lots of reasons. And I talk about it in the book. And so several years ago, I thought I have to create a process that I can trust.Leah:I can trust the process and my team can learn along the way, but at least the process will help make things reliable and will help me as the future testifying expert be able to depend on their work. And as I started creating this process, and then, you know, we were able to work more cases more efficiently. We were able to use data so that we were using best evidence and really just solving problems for clients. And then I started networking with other professionals like myself, and realized, oh, there's actually a need to, to understand and an interest, you know, like this whole area of forensic accounting just sounds interesting. So there's this whole interest in forensic accounting. So if I can present and share with everyone, what I have learned over my career about following a process, that makes sense, that's scalable, that you can work with a team.Leah:Then I think this would be really helpful. And so I had the opportunity to work with Wiley publishers last year to write this book, Data Sleuth, and it's based on our data sleuth process. And so in the book, I share a lot of case stories cause I've worked close to 200 cases in my career. So I share a lot of case stories and then talk about our data sleuth approach and framework to how we tackle cases, how we prepare planning, you know, because there's not some guideline out there like an audit might have for these are the things that you test, we're really driven by the concerns and the problems that the client is facing. And while walking a fine line that we can't just be a hired gun and give them information that would help them win. We have to be able to tell them, I mean, it's an investigation and we're a third party and we have a code of ethics.Leah:And so we're going to tell them, this is what actually happened and then work, you know, be able to address those concerns that they have while telling them what happened and helping them solve their problem that way. And so I talk about the process. I provide the case examples. I provide a couple case studies at the back and there's also we created a website. That's referenced in the book where you can actually download like our case planning templates and what I was talking about earlier about the fraud prevention approach from money in money out, we have a template for that process. And so I mean, obviously I'm biased because I spent time writing it last year, but I think it's a really helpful book. And the whole time I was writing it, I thought, you know, what do I wish? What was I looking for when I started on my own? What was I looking for to, to learn from other professionals and to hopefully share what I've learned over my career.Rouba:That's amazing. And we'll definitely post a link to your book and where people can get it online and great work. I mean, I'm really, this is very interesting and thank you so much for sharing so much insight about this. And I think there's much more to learn. So yes, I will be reading your book very soon.Leah:Oh, well, thank you.Outro:This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Connect with RachelFull Episode Transcript:Adam:Welcome back to another edition of Count Me In. The podcast that explores the world of business from the management accountants perspective. My guest today is Rachel Baesler, VP of financial reporting and technical accounting at FLEETCOR Technologies, a leading global business payments company. We talk a lot on this show about the need for accountants inside the organizations to partner cross-functionally with leaders and groups, driving business performance and growth as an accounting leader at a company that has completed over 90 acquisitions, Rachel is the perfect guest to help us better understand how accountants can overcome common stereotypes and thrive as strategic business partners. So let's get started.Adam:So, Rachel, thank you so much for coming on the podcast today, and we're just gonna jump right in cuz we're talking about strategic partnerships today and when you're building those strategic partnerships, a common term or role today for accounting and finance professionals is business partnering. That's the term we've been hearing a lot. And so how do you ensure success when building these relationships across departments?Rachel:So to ensure business success, collaboration and partnership across departments is critical to the success of the organization, I was reading this Deloitte report that said that 83% of organizations want to increase the time spent on finance business partnering over the next three years. So it can be difficult to foster open communication with accounting. We're often seen as an impediment rather than a strategic business partner. So they understand that we handle the numbers and that we handle compliance, but it's up to us to, you know, articulate our value and demonstrate how we can be a strategic partner. A major component of FLEETCOR's success is our M&A strategy we've had over 90 acquisitions to date. Each of these require extensive involvement from accounting. So last year we purchased AFEX for over 400 million. They are part of our cross-border payment solutions similar to Cambridge global payments, which are all newly aligned under our court pay business unit.Rachel:We have noticed over time that we are getting similar accounting issues come up in these deals. So for our deal team, we created this quick reference guide and we shared it with them. So these matters that come up over and over again, they have them at the front of their mind versus the back. This helps, you know, demonstrate our value as a partner cuz they know every decision they're making and an acquisition, there is an accounting impact. It also helps just foster a relationship with them. Now they know, you know, they know my name, they know to come to me, when things come up, I can help them work through issues and they understand their accounting implications.Adam:So is that why it's so important for accounting and finance professionals? Because you have to be a seat at the table, no matter what's happening, whether it's an M&A, or the strategy that's being run or FP&A like all those different things are happening. Why is it so important for accounting and finance professionals to be a part of that?Rachel:Well, there's, you know, the compliance matters, obviously it's our job to ensure that the books and records are accurate, but also, you know, in the business environment today, all departments are being asked to demonstrate their value and partnering with other departments is how we demonstrate our value in an organization. And this also helps us, you know, foster culture of governance and compliance because you know, we have a seat at the table and we know what's going on in the business. It also helps us, you know, understand what's going on in the business. So we can better communicate with our stakeholders. You know, I'm the one preparing a lot of investor documents, right? So knowing what's going on across the organization helps me communicate more effectively with our investors.Adam:So what skills have you had to develop to be a successful relationship builder in this process?Rachel:Okay. So I read another Deloitte study and it was talking about the main competencies you need to be a successful finance business partner. And it talked about you know, being able to challenge negotiate, have, you know, commercial acumen, strategic thinking. And then one, I think for me has been critical, which is relationship management, such a simple thing, but building interpersonal relationships with people in other departments helps foster open communication and builds trust. You know, we live in an environment where we receive lots of emails. Whenever possible, I try to meet with people in person or have a face to face video call even pick up the phone, you know, you're not, you don't really have the opportunity to build a relationship when you're communicating over email, this, you know, just helps facilitate an open dialogue and create a trusted relationship. I'll give you an example.Rachel:I was working on this project with, you know, it was KPIs and I was having to talk to different leaders of the businesses. I'm sure it felt like an incremental ask. One of our lines of business leaders I was working with on this project. We just started chit chatting about Disney world. He has kids, I have kids, he was giving me some tips. I haven't taken my children yet. They're a little too young, but we built this, you know, great rapport fast forward a few months. And we acquired a business and he didn't understand, you know, how the revenue recognition pattern was working with one of the new products. Fast forward a few months later, we acquired a new business and we have a new product and there's trouble with the business leaders, understanding how the revenue recognition pattern works for that new product. You know, now they know my name, they know my face. They know to reach out to me, I can help them, you know, translate the, you know, the product to the accounting impact. So it helps me, you know, I'm getting to know the business that we've acquired from the business leaders and from the target itself. And you know, I'm at the front end of the issue they know to get me involved and it's just a really productive relationship and it, you know, helped us get involved early. So.Adam:Yeah, it's almost like you've you learned how to connect on a human side with your other collaborators and then because you connected, you developed the relationship and that allowed you to, when that you needed their help or they needed your help, you were able to connect in a better way.Rachel:Absolutely. I mean, you know, if I'm just shooting an email, so I'd be like, give me this, you know, or even asking politely. You know, I'm not gonna be the front of their mind when a problem comes up. So, you know, just spending a little bit extra time with folks, you know, building that connection, it really helps create a good relationship. And you know, it enables you to have a strategic partnership. I think that's really hard to just like force that on someone.Adam:Yeah. I was thinking, you know how it's always easy for us to talk about for as accountants to say, how do we partner with everybody else? What advice would you give to somebody who is not an accountant? How do you best partner with the accounting team? We've already talked about the human side and building that relationship, but are there other elements that we can say, Hey, this would, this would be best way to communicate. This is the best way to kind of build that relationship, especially for, with the accounting and finance team.Rachel:I would say, bring us in early and bring us in. Often we can't be a strategic partner if we don't have a seat at the table.Adam:That makes sense.Rachel:Yeah. I mean, we're, you know, you know, we can be seen as a naysayer, but you know, we can be a strategic partner and understanding how we can help, you know, facilitate your performance goals. You know, for example, mergers and acquisitions, they don't fall out of the sky fully assembled involving accounting on the front end is gonna help have a more successful integration of a business help you meet your like performance goals. We play an indispensable role in these things ultimately. So if we're able to get involved in the front end, it's gonna help, you know, prevent any unexpected surprises or compliance issues.Adam:So it's almost like you're realizing it's, whoever's leading whatever project it is is realizing that the finance and accounting team has to be a part of the table in the beginning, as opposed to, Hey, now we need to talk about numbers. Let's bring you in later.Rachel:Yes. So maybe you have created some kind of business case in your mind, and obviously a numbers are important component to that. So when you're bringing something to a key decision maker, you don't wanna run it by accounting after the fact and find out that, you know, the projected figures you used in something are incorrect, cuz that's obviously going to have an impact on the decision making process.Adam:Of course. So when thinking about the future, you know, we've gone through a lot, the last three, almost three years now with the pandemic and everything. Are there certain competencies that you feel that, you know, finance lead finance and accounting leaders would need to continue to develop to become the best business partner possible?Rachel:So I think finance leaders need to have great leadership and communication skills and specifically in advising and counseling, your finance and accounting function, empowering them to engage in the business to engage in operations. I also think it's really important for, you know, finance and accounting leaders, to be able to articulate our value, to share our success. You know, how we were a strategic partner in a transaction. This helps demonstrate our value in an organization. You know, a finance and accounting leader needs to be able to share the value and success of the accounting organization, to other corporate leaders that run the business units. This will help encourage getting us involved. You know, someone here is about, you know, how we helped with this acquisition and understanding this product. They have a question on an acquisition that's rolled up into their business unit, they know to come to us on the front end, for example,Adam:Do you have any examples where that worked or didn't work or where that somebody wished that they had done that and then you were able to help them with that, that you can share?Rachel:Yeah. I mean, you know, we roll out new products, part of our growth strategy. So I've had some people forecast certain revenue figures and submit the budget and get it approved, but they didn't actually contemplate like the accounting impact of that new product. So I'll have to be the bad news bear on the back end being like I'm so sorry. That's actually, my revenue figure you projected, you know, is it's not achievable because the accounting standard says X. So when these situations occur, I always, you know, I talked about earlier, sometimes you have to be pretty explicit in your value is a strategic partner. You know, I'm like whatever new products you're contemplating, I'm happy to be involved in the conversations and the budgeting process. So, you know, bring me in and you know, I'm happy to help. Yeah. I've had both the successful and unsuccessful conversations, so.Adam:But I'm sure those conversations kind of help lead you to where we've been talking about of becoming that strategic partner, helping educate your team members to get them to that place where they bring you in earlier.Rachel:Absolutely. I mean, that's the bad scenario, right? When you find on the back end that, you know, something you thought achievable is not actually achievable, but I mean, yes, they're constantly at FLEETCOR, we are truly seen as a business partner in accounting. So more times than not, we are involved in contract negotiations. We're there at the beginning to help the business leaders understand how any changes in terms and conditions might impact our bottom line, for example. So we've had a lot of success in partnering with operations to achieve our performance goals.Outro:This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Connect with Amanda:https://www.linkedin.com/in/amanda-cohen-0b4b81a6/https://www.linkedin.com/company/resolver-inc/ https://twitter.com/Resolver https://www.facebook.com/ResolverInc https://www.instagram.com/resolverinc/ https://www.youtube.com/user/ResolverGRC Full Episode Transcript:Adam:I'm Adam Larson and welcome to Count Me In, the podcast focused on all the ways management accountants can help businesses thrive through smart financial management and data driven decision making. My guest today is Amanda Cohen, the vice president of product at Resolver, a software company helping businesses manage complex interconnected risks. We talk about the image problem that governance, risk, and compliance functions or GRC have at many businesses; namely, that they're tedious, repetitive and restrictive. Amanda explains how this negative perception of GRC actually hampers innovation and growth. The good news is Amanda has tips to transform this frog into a prince at your company, making GRC a more dynamic and valued partner to business operations and performance. I hope you enjoy this modern day fairytale featuring our favorite stars: management accountants.Adam:Amanda, thank you so much for coming on our podcast today. We're really excited to have you on and today we're gonna be focusing a lot on risk or governance, risk and, compliance, kind of the big three words governing organization. And one of the biggest things that we kind of wanted to focus on is, you know, there's an image problem that you've said a number of times that there's an image problem with with GRC. Can you kind of talk a little bit about that as we get started today?Amanda:Yeah, certainly. So I think a lot of it, well, I think there's a couple different angles that the governance risk and compliance space has a bit of an image problem. First and foremost, I don't think a lot of the organization understands exactly what they do and how they provide value to the organization. And so often they're seen as a barrier that maybe comes in a little late during the project or, or something that's preventing you from getting to your objectives. And really, I think that's all just in terms of the order of operations. If we can flip that around a little bit and bring these teams in earlier, it's not that person who's getting in your way of completing your project or helping you complete or achieve your objective. Really what you're starting to do is you are bringing them along for the ride and helping or using those teams to help guide your project and make sure that it's operating with the realm of what's appropriate for the organization.Amanda:And then they're gonna help you find really creative, suggestive alternatives to help move things. So that's kind of one area of the image problem is, you know, there's a barrier specifically that they seem to be imposing. And then the other one that we hear a lot from our customers is really that it seems like these teams are constantly asking me for the same information. And so, you know, you might get a request from someone in audit and they're looking for a bunch of documentation on how you run a particular process. And then two weeks later, two months later, someone from compliance is coming in and they're you the exact same question, you know, your internal controls team, same thing. And so it's like, why can these teams not just get together come up with some kind of strategy on how to collect that information and then reduce the onus on me because the business is really just trying to accomplish their job. It's not their job to provide you with the documentation. And so when there's more synergy between those teams it also reduces a little bit of that friction that you often get from the business.Adam:It almost seems like when you're looking at risk management from an organizational perspective, the organization's mission kind of needs to be the foundation of that. And the focus of that risk management, because otherwise everybody won't be on the same page if it's not there, how do you get there?Amanda:So, I mean, there's a couple ways to help be a part of those strategic decisions, be a part of what the organization is trying to accomplish. It really helps when you have buy in from the top. If your executive endorses and believes that risk and compliance has a place at the table during those discussions, it's gonna be a lot easier, but in order to, it's a bit of a chicken and egg, because it's also in order to be included in those conversations, you need to be providing insights. And so something that, you know, if all the risk function or the compliance function, whatever it may be is there. And they're just, you know, showing up at that board meeting, showing up at that executive meeting to present their five minutes on their findings and, you know, maybe their last regulatory audit, like, okay. But what have you uncovered what's in your data to help us understand, you know, how the organization is gonna achieve their objectives? Are there potentially a couple alternatives that we could consider or that we should be thinking about as we're making these strategic decisions? And so when risk can bring more valuable data that also helps propel them forward and allows them to be a part of that conversation and that'll help get that executive endorsement and then allow them to be, you know, help the organization achieve that mission that they're trying to accomplish.Adam:So I know that you know, it's probably rare that, you know, your CMA, your certified management accountant, your management accounting will lie awake at night thinking, oh no. What about that regulatory compliance document? It is something that's important. And a lot of times culture plays a role within the organization. How does the culture play a role, especially when it comes to risk? And, you know, you've talked a little bit about already about how, you know, the compliance person will come and say one thing and the other person will come and say and ask the same question. How can you establish a culture that'll help get everybody on the same page as well.Amanda:Well, I think when we're thinking about it from the lens of the finance team, often finance is thinking about your financial controls. But if you have just a limited view of the controls that are specifically financial, there's a lot of other things that happen within your business that could impact your ability to achieve your financial targets. So it is actually in your interest to understand your third party risk. We've all over the last two years experienced delays in supply chain. Okay. Well, how could that impact us achieving our objectives? You know, there's cyber risk. Okay, well, you know, do we have cyber insurance? Do we have all those things in place? And so it's not specific to one particular team because risk is pervasive. Everybody experiences risk throughout the organization. Number one experience is risk actually throughout their daily lives. You know, you were constantly making decisions that are risk based.Amanda:You just might not be thinking about it in the form of, you know, risk based decision making, the way we think about it kind of academically, or either, you know, as a risk function, but there's so many pieces to the things that are happening across your organization on a day to day basis that can help inform, you know, whether you're gonna financially, you know, continue to be a viable company. And another thing that the risk function really does track that actually, you know, has a direct impact for the financial team is loss events. So if you have that operational loss of team or operational risk team, sorry, within your organization that are tracking, you know, incidents and breaches and different loss events that are occurring throughout the organization, it's like, okay, well, are we seeing any trends in that data? Are we constantly being hit with the same type of incident over and over? That, you know, if we just rectify what's happening in that part of the organization, could we be saving ourselves a ton of money? And so if you start to embrace some of the data that the risk function has then you'll start to understand the value of it, and really be able to use that as part of your decision making process.Adam:So speaking of data, a lot of times, you know, we have a lot of data analytics going on within our organizations, especially within the finance function, finance and accounting function. And a lot of times organizations bring in some sort of, you know, high tech security management software, thinking that that's gonna solve everything. And in 2022, you know, threats are very real, there's so many cyber attacks happening all the time. Can we talk a little bit about what that looks like in an organization as they bring in, in a software, but knowing that that's not the final end all.Amanda:Yeah, so I mean, technology is great. It certainly helps propel things forward, but it's only as good as the data that goes into it. And, you know, it's only as good as like the process that you're able to implement and make it repeatable. So I guess there are a couple mistakes I see sometimes with people thinking that, you know, technology is gonna be their savior and this is gonna fix all our problems. And one it's trying to take on too much at the same time. So when you're looking for technology and you're looking at particular, well, any technology, but specifically within risk and compliance, you know, what are the pieces that you wanna get in place first? Is it just a little bit of process automation? Okay, great. We want some better reporting. Let's start there. Let's make that our goal for the first year or two, and then make sure you've got a platform or the technology that you choose is able to scale up with you because there's nothing more resource draining than having to reimplement technology all the time.Amanda:And so if you can slowly scale up and have something that's gonna allow you to build your program and build maturity into your program over, you know, the course of five, 10 years, then, then that's really an ideal state. The other thing is thinking about buying things all in isolation. So we just talked about, you know, that constant bombardment on the business for the same types of information. Well, if we can sit on the same form of technology and we can ask those questions once and share those insights between teams, then you're already starting to get value. Whereas, you know, historically we have seen a lot of organizations put their compliance program on one piece of technology, audits its, goes somewhere completely different. Their internal controls program is somewhere else, but then you're all using a lot of the same controls. You all see a lot of the same issues, you're all testing the same types of things. So why not share those insights? So, you know, think about something that's gonna grow with you, but also think about something that allows you to share data between teams.Adam:Do you have maybe some, an example that you can share about where this has gone well, and maybe hasn't?Amanda:Yeah, so often we find I guess where it doesn't go well is a lot of people dream up process in their head and they're like, it's gonna be great. We're gonna have, you know, five review steps and it's gonna go through this whole escalation cycle. And, okay, well now you've only introduced like a giant barrier from you getting between, you know, your initial objective and the conclusion of what you're trying to accomplish, whether it's a risk cycle or a risk assessment cycle, whether it's testing, whatever it may be. So think about streamlining that and not trying to tackle too much all at once. The more steps in your process doesn't necessarily make it better. It often just slows it down and stops you from being able to achieve what you're looking to do, where we see it go really well are teams that get together early.Amanda:So if you're trying to share data between risk compliance, audit, all of those different teams, there's certain data connection points that you really wanna get established early. You're all looking at controls. You're all looking at issues. You're all looking at, you know, corrective actions. So what are those common things that you're gonna collect across all the different teams and get in the room together early to figure out what's important to your team? You know, what does that process look like? You all also have different pieces of the puzzle that sit independently, but where there's those common data elements. And you're trying to capture all the same information, work together to find that because if not, you're gonna implement it one way and one part of the business in a completely different way somewhere else.Adam:So now we've kind of talked about the technology. Obviously it takes people to run that technology. Can we maybe discuss a little bit of the skills and competencies that the accounting and finance team will need as they are running as they're kind of complimenting a successful, like risk management program in their company and their organization?Amanda:Yeah, certainly. So the ideal state for most technology that you implement is not that you need to be a coder. You shouldn't need to do any of those things. So in terms of technology investment, hopefully there's none there. If that's the route you're going down from a technology provider, there's other options and, you know, maybe keep, keep looking. But in terms of how the data that's getting connected or that you can be leveraged across the GRC function by finance, make sure that you are getting the types of outputs that you want. So if you need an overview of kind of your comprehensive control environment and how that's trending over time, you know, you should be able to get that information in the system or have it be able to be extracted and sent over to you so that you can have that visibility, but you really want a view that's catered to just the information that you need.Amanda:So as one of these programs, as being implemented within your organization, think about the outputs that you want. You definitely wanna view of how the controls are operating. You know, how frequently these things are being tested. You know, what are the outputs, where are the major gaps? What are the remediation activities look like? And how long are those gonna take to complete? So those are the types of dashboards or reports that you wanna have access to when you either log into the system or something that should be really easy to be shared out with you, so that you can always have that information at your fingertips because you are equally relying on a variety of these controls. And so if there are something, if there's anything going wrong with them, then you wanna make sure that you have complete visibility to that. And you understand the remediation program in place.Adam:That makes a lot of sense, cuz you have to kind of be on top of it and be able to see it from that overarching view. But obviously it's good that you don't have to be a coder as well.Amanda:No, you definitely don't wanna have to take that on as well.Adam:I mean, yeah. Accountants are seeing more and more the need for having the skills of a data scientist as they get into all of these items. Do you think that data analytics is gonna continue to be on the rise in the future as we go forward five, 10 years so much is gonna be changing. How do you see that looking for the accountant as they're looking in the GRC function?Amanda:Absolutely. I think that, you know, it's no longer acceptable to just particularly on the risk side, you've got this stereotypical view of someone putting almost like a traffic light report in front of you. Here's my top 10 risks. This one's red, this one's yellow when the rest of them are green, that's not sufficient. You need to understand what's the underlying data that's supporting that decision. How did you come to the conclusion that that's high risk? Is it high risk everywhere across the business? Is that concentrated one part of the business? And so having the high level view, but then also the ability to drill into that data is really fundamental. Additionally, in order to get those insights, we can't exclusively rely on humans coming in to input them. There are so many systems. Everybody has technology in some capacity within their function. You know, it might not be super mature everywhere, but there is technology being used everywhere.Amanda:And so what are the different types of insights that you can pull from your different systems to make sure that your risk data is really up to date and really accurate? So, you know, is there something coming out of, you know, your CRM? Is there something coming out of your marketing data that you might wanna make use of your financial systems? So pulling that data together and then making sure that you've got, you know, a pulse on your key risk indicators, your key progress indicators you know, that's really gonna make sure that you're keeping on top of your risk levels and risk exposure across the organization.Adam:So as we kind of wrap up the conversation, I kind of wanna end where we started and the compliance image problem. Let's say there, if you could give our audience maybe two or three things, two or three pointers of like, okay, what are three ways that we can start off by getting a better image of our compliance image of our compliance program so that we can, you know, do better in our organization? What would those be?Amanda:I think it's really articulating the value. It's not compliance. Isn't just putting a training program in front of you so that you can skip through to the end. It's like, why do you need to understand that? Why is that information important? And how does that as an organization help us be better. It doesn't help if members at the top of your organization are not putting forth, you know, the right example if they are not endorsing compliance and risk methodologies and that culture. So it's really, I think without articulating how these functions bring value to the organization, it's really hard to overcome that image problem. And then again, reduce the burden. I think the more cumbersome it is for people to provide you with the information, the worse response you're gonna get. If it's always a two hour interview where they have to sit down and walk through their entire methodology, that's really cumbersome. And if that interview happens every two weeks, that's awful. So how do we really reduce that friction and make it super, super simple to provide you with the information that you need, what you're doing by providing risk compliance, audit the information they need should be no more difficult than it is to, you know, buy a pair of shoes online. You should be able to just come in, submit the information that you need to, and then move on with your day.Outro:This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Resources:1.  Quora link to building a great Linkedin Profile2. Articles about job search/networking or how to reach out to that mutual connection like we discussed in the middle of the episode3. Daniel's book: https://www.amazon.com/Build-LinkedIn-Profile-Business-Success-ebook/dp/B00N18B2RSFull Episode Transcript:Neha:Welcome back to Count Me In, the podcast that explores the world of business from the management accountant's perspective. I'm Neha Lagoo Ratnakar from IMA. And today I'm speaking with Daniel Alfon. Daniel is the author of the book, How to Build a LinkedIn Profile for Business Success. He helps businesses and individuals succeed by maximizing their reach on one of the world's largest business networking communities. Today he'll be sharing pro tips for using LinkedIn for career networking, business development, content marketing, and more. If you use LinkedIn for any reason, this is a conversation you don't wanna miss. Let's get started.Neha:So hi Daniel. Thank you so much for joining us today.Daniel:Thank you very much, Neha, I'm glad to be part of Count Me In.Neha:Excellent. So let's start with the why. Social media is not something that is top of mind for many professionals, especially accounting and finance professionals. So help us understand: why is social media and more specifically LinkedIn so valuable for our accounting and finance listeners?Daniel:Oh, that's a great question. I think the easy answer is that whenever an employer or any client will Google your name, then your LinkedIn profile is going to top the list on Google. That's the simple reason. And if you care about the image and your professional image, then you should leverage LinkedIn and make it shine.Neha:All right. And as a tag along question to that, how can accounting and finance professionals leverage LinkedIn better?Daniel:Great. It starts with understanding our career objective, whether some of the listeners here could be managers who want to get promoted in the organization or moms who had their maternity leave and want to get back to the workforce or young people trying to start out in business or get the the CMA certification then having target list of companies or career objectives for you is the prerequisite for anything you'd like to to do. And then because your LinkedIn profile, the most frequent action LinkedIn users perform on the platform is visiting other people's profiles.Neha:Mm-hmm, that's true.Daniel:And it needs to speak for itself. In other words, if I go to your profile, you will not be there to add information. And, when I see the book that you've released and I see your headline, and I see the photo and the VO photo is visible, and I see that you've added feature content. I'm likelier to stay here and try to discover what is it you do? And for the accountant or the management accountant would be seeing what they have achieved in their current position. And why is it a good idea for me to reach out to them?Neha:Wow. I love that. Keeping the person who's visiting your profile engaged throughout. Awesome. And thank you for bringing up career objectives. And we are in the era of the great resignation right now. So let's pivot to that part of LinkedIn job search. And if, if somebody's looking for a better job, how can LinkedIn be helpful for you?Daniel:Okay. The keyword is networking. When we think about the four step that that you that you roll about, and network is probably the single most important element we need to take into account. We may move from one part of the world to another. Our network is the key asset that is likely to make our career grow. And whenever we run an advanced search on LinkedIn, LinkedIn advanced searches or excellence, and that's probably one of the misused and underutilized assets, you can run advanced searches for a company you're interested in, and you would be able in many cases to identify the person you are likely to report to. And in some cases, you'll see that you and them, you share mutual connections,Neha:Right.Daniel:You connect with people, you know, well, you could leverage that meaningful connection, leave LinkedIn, and ask that person to introduce you to your ideal hiring manager or to your ideal customer and the power is to leave LinkedIn. As much as the LinkedIn is a powerful platform, close to billion users. Two people sign up every second. Still hear me out. The big secret is to know when to leave LinkedIn. LinkedIn has shown us the name of the person. And it showed us the name of the mutual connection. Now is the time to leave LinkedIn because in real life, what we are interested in is an interview. The interview is not going to happen on LinkedIn. LinkedIn just provided us with the names, and then we need to forget about the platform and get back to real life. So we, we land that position or start that discussion.Neha:Wow, that's quite insightful. So looking up people on LinkedIn, but moving on from there to actually network with them directly. And how can that be done in a remote-first world?Daniel:It could be, when you say you run a search and you find someone you'd like to reach out to, and you see that you do share a mutual connection with them, or several mutual connections with them. Then we, if you two are connected by visiting their profile and clicking on contact info, you would get their email. Simply leave LinkedIn. You send 'em a message. You ask how they've been. And at one point you page the link to the hiring manager or to the ideal prospect you'd like, and you ask them, do you know that person well enough?Neha:Okay.Daniel:And Neha, in some cases you could, you could guess because if your mutual connection has 300 connections, and the hiring manager has 400 connections, then chances are they know each other.Neha:Okay.Daniel:And if you spend 30 more seconds in, you see that they went to the same school, or they worked in the same location for the same company, it gives you also a probability of them knowing each other. And if you manage to have a meaningful introduction that can get you foot in the door, and that can start a meaningful process, hopefully leading to a contract.Neha:Wow. That's some great detective work there, Daniel. All right. So from career tips to, let's pivot to another key aspect of LinkedIn. Now, many of our listeners are consultants, or they work in small businesses, and I know you're an expert at getting clients from LinkedIn. So what are your top tips from, for business development on LinkedIn?Daniel:Okay, great. So I'll, I'll say this, there, there are two pillars. I think we need to consider. One is a converting profile. And the second is our connection strategy. So very quickly a converting profile will make your ideal reader understand what you bring to the table. And that your connection strategy should enable you to use or to leverage, or to ask people to introduce you to the hiring manager or to the ideal client. And that means you need to pick either quality or quantity. And try not to stay in between quality means you connect only with people, you know well, quantity means you have 30,000 connections. 30,000 connections gives you exposure. With people, you know, well, gives you trust. If you try to aim for both in most cases, you'll end up with very little of either, okay. Not enough exposure and having polluted your network. So pick one.Neha:Wow. Okay. I never thought about it that way. So those are excellent ideas. And I also wanted to bring some global perspective to it, to our conversation today. Now we have close to 140,000 members around the globe and, people use different social media, but they also use LinkedIn differently in different parts of the world. Are any other platforms important for people to know? And what can international listeners do to leverage these platforms or even LinkedIn?Daniel:Okay. So I'll start with something that's not LinkedIn that's Quora. So I'll share with you later a specific Quora is a Q and A website that has excellent answers and I'll share a free resource or how to build your LinkedIn profile and answer. I put on Quora over 10 years ago, and at one point I developed it into a full book. I think Quora is great to learn. And if we go back to to LinkedIn, then IMA has, has over 300 chapters, worldwide networking could happen in your chapter with your peers, with people who work for companies you could be interested in regionally or globally. And if you know you want to relocate, or you are interested in a different market, then identifying that chapter ahead of time could also be helpful.Neha:Excellent. And just for our listeners Quora is spelled as "quora.com". That's the one. Perfect. Thank you so much. Now I love all your ideas by the way, Daniel. So let me throw a challenge to you. If our busy listeners had just five minutes to spare today, what can they do immediately after this podcast? So to massively improve their LinkedIn presence?Daniel:Why Neha? I love this question. I'll do it fast. So, first question is who's your ideal reader? The ideal reader in my book is either the hiring manager, if you're an employee or the ideal prospect you have.Neha:Okay.Daniel:Second question. What action would you like that person to perform if they visit your profile?Neha:Okay.Daniel:You may want them to reach out to you or to visit your website.Neha:Mm-hmm.Daniel:Would you look at your presence and you ask yourself if I were my ideal reader, would I feel compelled to perform that action? And am I providing them with the right information at the right order? That is likely to make them convert.Daniel:Okay. And another quick tip would be to ask someone you're not connected with, to look you up on LinkedIn using the app, and then asking to share with you their thoughts. Say, if you are looking for, to be a CFO, or if you're looking for a specific customer, can you walk me through what you would think if you viewed my profile and you were looking for a CFO with this qualifications, and you would be amazed by what the answers could be and what is important is what other people understand? What other people see in some cases you'll see that they don't see your profile photo, and it doesn't help that you have a profile photo, but if though, if they don't see them, then it's not there. So you need to tweak your LinkedIn privacy so your photo is public.Daniel:And if they look at your headline and they're not sure what it stands for, you need to try and help them. And you try to make the banner and the headline rock, because the headline is the single most important real estate on our profile. And if it's not clear, if it's not converting, many people will simply go away. So ask yourself, who's your ideal reader? What question you, what action would you like them to perform and help them do that? And if you have an additional minute, ask someone to look you up and just share with you their thoughts,Neha:I love that getting unbiased opinion of a person who's not connected to you on LinkedIn. Love, love, love that, so let's move on to the next question in my list. We talk about a lot about being future ready. So since there's a lot of talk about being future ready, can LinkedIn help professionals stay on top of the competencies of the future or jobs of the future as they continue working?Daniel:Wow, that's a great question. Yes. LinkedIn is one of the main tools that could help us understand what the future looks like. And one thing we could do, especially if we're working for the same company, maybe for two, three years, is try to assess what happens in the market. And what would happen is that if we see that most companies that are looking for a specific skill will see that trend. And we see that now, you know, 30% of the companies are are requiring some financial XYZ. And we need to make sure that if we want to be future ready, we need to either take a course or try to find an opportunity within our employer to try and, and gain more skills about it. And going back to the question of networking, if you happen to to attend the IMA 22 in Austin, in June, then networking there could be a great way for you to build your future for 2023 and 2024 and 2025.Neha:Wow. So yeah, networking, I think is, is an integral part of every step of social media or LinkedIn. But I also love your idea of continue to browsing through job descriptions, even if you're not looking for a job. So, you know, what people are now looking for. Wow, those are some really neat ideas, Daniel, and that was such an informative chat, but this brings us to the end of our conversation today. And I really, really appreciate you sharing your knowledge and expertise with us today.Daniel:It's been a pleasure Neha. Thank you very much.Outro:This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Connect with Rocky: https://www.linkedin.com/in/rocky-buckley/http://powerpersonaproject.com/ Full Episode Transcript:Adam: (00:05) Welcome back to Count Me In, the podcast that explores the world of business from a management accountant's perspective. Today, I'm speaking with Rocky Buckley, a personal branding consultant who helps experts maximize the value of their unique knowledge and skills. Rocky does a great job of demystifying the concept of a personal brand and explains how understanding and embracing your specialization helps management accountants and others thrive in a chaotic world.  Adam: (00:36) Rocky, thank you so much for coming on the podcast. Really appreciate you coming on to share your expertise with us today. And so today we're gonna be kind of talking about personal branding and there's so many things happening in the world like pandemics, wars and in a lot of ways you have to kind of find a way to make yourself stand out in order to show the world, Hey, this is who I am, and this is how I want to go. And so kind of, maybe we can start off. Maybe you can define what does it mean? What does personal branding mean and why is it important for us?  Rocky: (01:06) Yeah, well, personal branding is really an offshoot of branding itself, which, in a nutshell basically is a way to take a shortcut into people's minds, right? We're in a crowded marketplace. There's a lot of noise. We're bombarded with marketing messages all day long, all sorts of different inputs and the ability to stand out, as you said, to be able to sort of penetrate through all of that noise and cut through in a way that resonates with the type of person that we're we're targeting. It becomes very important to figure out a way to do that. So on a corporate level, you know, of course, branding is sort of that company's vision mission, what they're all about. And then all of that gets crystallized into, you know, visual form. It can be a logo, it can be a style, it can be a way that they communicate their message to the world.  Rocky: (01:58) So when you take that to a personal level, the same sort of principles apply, what we're looking to do is take all of those aspects of ourselves that make us unique, different, you know, and really connect with that kind of person that we are for that we're really targeting at. And being able to kind of create a shortcut version of that, a crystallized version that somebody can very quickly get what you're all about and get whether or not they connect with you or not. And again, we're not looking to please everybody, but we are looking for those people that we are trying to connect with to resonate with us. And so, you know, when we talk about personal branding, you know, some people just naturally come across in a way that cuts through, right. They just have a big enough personality where they resonate with people, but for most of us, you know, it requires some conscious thought and design.  Rocky: (02:48) It's sort of like thinking through, you know, what are those elements about me that are different? What are those aspects about what I do that I really want to convey very strongly? What's that sense of purpose maybe that I have, right. That makes me excited about what I do. So it's being strategic and kind of being able to figure all of that stuff out and then being able to distill it in a way that's constructed for public consumption, right, for other people to be able to get and get it really quickly. So that turns into, you know, your messaging and your visual branding and all of that kind of stuff. But ultimately we want a snapshot of ourselves that people will be able to kind of understand really quickly that simple, fast, you know, and easy and cuts through the noise.  Adam: (03:29) It almost makes me think of that old fashioned elevator pitch that you would say, you know, if you're in an elevator, what would, you know, what could you say to somebody in that ride on the elevator in a sense, right?  Rocky: (03:38) Yeah. Yeah. It is that really that fast because, you know, especially now as people are moving more online and the online market, as you just mentioned, pandemics and wars and stuff, it's really made people rethink their business. A lot of people have now decided to come online much more than they ever were before by necessity or by choice, right. When you step into the online marketplace, you know, you find it's even more crowded and you're connecting people through a scroll on a phone typically, or some kind of a timeline where, you know, if you're scrolling, let's say through Facebook, I mean, Facebook can only put so many people on your timeline, and it's basically a way to compress the world into this one narrow thing that people can scroll through. And so for you to be able to actually have somebody stop the scroll and actually pay attention to you for more than a few seconds, like that's a big deal and we've gotta master kind of the art and science of being able to know how to do that. Right. And so, yeah, the online marketplace is really, really crowded and yeah, more important than ever before. And it's just going to become more so, you know, there's billions of people in the world that haven't even come online yet, you know, so like it's, and the population of course is growing and so on. So being able to construct an effective personal brand that cuts through this is sort of a master skill that I think is only gonna become more important as time goes on.  Adam: (05:07) So what I'm almost hearing you say, it's almost like we need to make ourselves like a specialist in a way to make sure that we stand out in that way. Does that make sense to make ourselves a specialist?  Rocky: (05:16) Well, I think being a specialist is one aspect of a way to stand out. I think that specialization is more of a conversation about business model. I think there's a reason why we would wanna specialize beyond just the branding elements of it. Specialization allows us to do things like raise our prices a lot, charge a lot more. And it really affects then everything downstream in a business model. From a branding standpoint, yeah, specialization is one of those ways that allows you to filter all of the people potentially in the market and start to narrow those down into a slice that you can target very specifically. So for example, you know, a good, good example of that might be as if you were a doctor and you were a general practitioner, you know, versus specializing in one part of the body.  Rocky: (06:09) Right. And so therefore, you know, you're gonna basically be for those people that are looking for that one thing, you know, I have a problem with my nose or something like that. And I'm looking for a nose doctor as opposed to a general practitioner. So when it comes to something like accounting, yeah. If you can specialize and be great in that one area, you're gonna cut down the potential number of people that you're trying to reach. And the potential people that are looking for you are gonna be able to find you much more easily because you're focused on that one thing. Yeah.  Adam: (06:42) Hmm. That makes sense. Yeah. Cuz when I think about it, a lot of times accountants have to wear so many hats, especially if you're in a small to medium size business and you're a CFO or controller, you kind of have to be a jack of all trades. You have to do a lot of different things. And so there have to be ways to differentiate yourself in a way. So a lot of times people start with certifications, you know, IMA offers a certification, certifications are one way to kind of make yourself a specialist. Are there other ways that you can kind of establish yourself in that way?  Rocky: (07:10) Oh sure. Well, first of all, just the choice of that market niche, that's step one. So if you decide like right now, Hey, I am a general practitioner, but I wanna really reinvent myself. I wanna change what I do. I wanna be able to narrow my focus. Then there's a process of going through, you know, a really internally thinking about, you know, who are those clients that I really enjoy working with the most, what am I really good at? What am I my best at? And so there's a process of again becoming strategic about it, really thinking through, you know, what makes me different, how do I stand out? You know, what am I great at? Where have I had the most success perhaps with clients? What do I enjoy most, et cetera. So I think you kind of have to start there internally because the source of being able to really resonate with other people as a brand is your passion and your enthusiasm for something, right?  Rocky: (08:07) So like if you really find a certain kind of accounting to be dull drudgery, you can make a lot of money at it, but you really despise it. You know, you're not gonna really wanna specialize there. You're gonna wanna find those areas that you're super interested in that you naturally love because you know, it's hard to become great at something that you don't love doing, you know? And so I always kind of start with this inner game component when I'm working with people to kind of help, to drill down into that, find that, discover that. And once you've tapped into, Hey man, you know, ideally, this is what I'd love to do. This is what I would love to become, you know, two years from now, five years from now, ideally this is who I wanna be. When you can get a clear vision for that, then you can start working back on the specialization aspect of it I think, right.  Rocky: (08:57) You can say, then what do I have to do to get there? And that's where certifications may come into play, but there's also other ways to specialize too. Like you don't only have to specialize on the niche that you're doing. It can also be your system, your process. You may have a way to do things that's very fast or very effective and you can differentiate yourself and specialize, for example, in the area of speed. Let's say you're able to get something done much faster than everybody else. You've got a system for how to do it. You can basically be a specialist in that system, right? So there's lots of ways to slice up, you know, what you do to make you special and stand out and again, be able to charge more. I think ultimately from a business model perspective, when you can shift your pricing, that changes the game on a whole number of other levels, because you don't have to work with as many clients, right? If you have more profit margin in your business, you can do more things to advertise, promote yourself. And then when there's more profit margin, you can also bring on other team members, right. So you can start to scale. So like specialization has a number of ripple effects, you know, after that, there's a lot of dominoes that go in that get kicked off when you can start to specialize. So hopefully that helps.  Adam: (10:18) Yeah. That makes a lot of sense. So as we're talking about this, I'm thinking about like, you know, being a specialist and you're trying to figure out your personal branding, it seems like as you're trying to plan all these things out, you kind of have to get a vision and kind of make some strategic decisions around, you know, around what your next steps are gonna do. Are there certain questions we should kind of ask ourselves as we're kind of trying to lay out those strategic decisions going forward?  Rocky: (10:44) Yeah. I think some of the stuff that I mentioned at the top, what do I really get excited about? Because I made this mistake when I first started my business 23 years ago, I saw an opportunity to make money, right? It was right in front of me and I kind of liked it, but you know, I didn't necessarily love it, but I said, okay, here's an opportunity for me to turn what I know into a business. And so I jumped into that business and I got good at it and I got clients right away and, you know, but I didn't really, really love it. And over time, that lack of passion started to play out the busier. I got, the more successful I got, the more I just found myself living a life that I didn't wanna have or I was just busy all the time.  Rocky: (11:29) And I had no margin, no space in my life. And I really wasn't feeling like I was making a difference. I wasn't making an impact on people at a level that I wanted to, right? So for me, like I think these considerations are first the inner game part, right? They are that what do I love, what am I really good at? And then how does that start to craft into a message and a brand? So it may be, you know, mining out aspects from your life story that can connect with other people, right? So you start looking back at your life and finding those pivot points and those moments that really started you down this road and that can connect with other people, right? So you start learning about your story and aspects of your personality that you can bring out in your marketing and your messaging and so on, you know, and then you become more strategic.  Rocky: (12:14) Like, how am I going to position myself differently? Let's look at the market, let's see who is out there, who's kind of in a similar space to what I'm doing and what are they doing? Like, what do they sound like, how are they messaging themselves? Right. And how do I now position myself as different? Ideally we can position ourselves as the first and only one who does what we do. Right? That's a key aspect of all positioning is being first and only. So if we can almost create a category for ourselves, right? How can even if it's something fairly small or minor, how can we position ourselves as, Hey, I'm the first one? Or I'm the only one who does this, right? Because that cuts right through. So those are some of the strategic aspects. And then that starts to start to formulate a personal brand.  Rocky: (13:03) It starts to get into, okay. As I market myself, what does my first of all my visual brand look like? What, you know, the logo and all that stuff. That's what people typically think about when they think about branding. That's about logos and business cards. That's really not what it's about, but that's an aspect of it, of course. But you know, you start getting into, okay, if I'm gonna start marketing myself online, that typically means I'm gonna put out some form of content, right. It might be a podcast like you're doing, or it might be, you know, I'm gonna make videos or I'm gonna create a blog or I'm going to, you know, tweet on social media, right. I'm gonna be on Instagram or whatever. So choosing the channel that really fits your market is important. So for example, I would assume for accountants, LinkedIn might be a very important platform to be on.  Rocky: (13:48) So let's say, you decide, okay, I'm gonna go heavy into LinkedIn. I'm gonna put out a lot of content. So that might mean every day I'm gonna make a short video or I'm gonna write a post or something like that, but I'm gonna gradually become visible and I'm gonna build my visibility and I'm gonna build my network and I'm gonna put myself out there as an expert. Well then what kind of content am I putting out? How am I framing the way that I talk about my subject differently than everybody else, that's congruent with this personal brand idea that I've created. Right? So let's say it is I'm an accountant in a specific area. And you know, my personality is such that, Hey, I'm a big sports fan, you know, outside of business, I'd love sports. Well maybe, you know, you can look at some of these aspects of your personality and start to blend those into your business, you know?  Rocky: (14:40) So you may show up and like, you know, you start to position yourself somewhat as like a sports guy in some way, right? And you're like the sports accountant sort of person that, you know, you use sports metaphors. And so, you know, when you're talking about your business, but there're just ways to kind of create a different paradigm around yourself, the way that you look at your subject, right? So there's all these different factors that come into play downstream. As you create this personal brand, it starts to play itself out in real product. You're gonna actually put out content. You're gonna, you know, be interviewed. You're gonna, you know, all these different things that you are gonna now roll out, but they're coming from a particular point of view, a strong point of view that's clearly defined, that people get right away and then ideally either they like you or they don't right away, you know, polarizing is sometimes really good. Like, Hey, I really love this guy. Or I hate this person. That's actually a good thing. And branding, because you want people to get you really quickly. And those people that love you, you want them to really, really resonate with you, you know? And that's kind of the idea. You wanna create a tribe of like raving fans,  Adam: (15:51) A tribe of raving fans. I like that. Yeah. So in order to get those tribe of raving fans, you almost have to kind of market yourself in a certain way. Is that the importance of the marketing is kind of getting yourself out there?  Rocky: (16:04) Oh yeah, sure. And you know, a lot of marketing is simply mathematics. The idea is, you know, how can I get in front of X number of people per day? So for accountants, that should be, that should be fun to figure out, you know, what am I looking to build here? If I'm looking to build, let's say a million dollar business, what does that look like in terms of clients? You know, how would that shake out? What's my process for getting clients, right? So some in some way we're gonna construct some form of a sales funnel. We want people to be able to get in touch with us and then, you know, become a client with us. So what does that look like? What does that client journey look like from A to Z? You know, the person who has no awareness of who you are to the end, they sign up and they become a valuable client for you.  Rocky: (16:53) What does that look like? And so, as you think about your business and you think about, okay, you know, who is it that I'm looking to target? How am I going to get those people to become clients? Let's reverse engineer the process backward and say, okay, how do I engineer that first contact with a person? So it may be on LinkedIn. My idea is they're gonna see a piece of my content and in my content, I'm gonna offer something. I'm gonna say, Hey, if you're interested in this subject, grab my free checklist, or I've written a report that talks about this. So come to my website and sign up for that report and opt in. Right? So now you've got a person on your email list, then you're gonna use your email list to, you know, put out content every day or every week, a newsletter, something like that, where you're consistently staying top of mind with people, right? And then you have a mechanism in place, Hey, if you'd like to learn more about working with me, you know, here sign up for a free 30 minute consultation, right? What I'm saying is very basic, but this is a process that you would ideate and you would start to put into place, you know, to get people into your world. And then again, turn them into paying customers or clients.  Adam: (18:12) So as we kind of wrap up the conversation, you've shared a lot of great insight about the personal branding and how we can become specialists and how we can use marketing. What are maybe like three steps that somebody can take to get started on this process? They never tried this. They've never said I've never had a personal brand, they feel like they don't have a personal brand. What are like, you know, the three steps that they can kind of take to get started?  Rocky: (18:35) Yeah. The first thing I would do is try to learn from other people. I would try to model other people. So in your market, there are probably people that you follow that are the thought leaders and experts in your particular space. I would start, you know, doing some studying of those people. I would start looking at, I would sign up for their email list, right? I would look at, have they written a book? Do they have a podcast? Do they have a YouTube channel? Right? Are they on LinkedIn? And I would start to reverse engineer what other people are doing. And in doing that, you know, you can start even over a period of time in the background as just a little sort of hobby that you do over time, right? You may be really busy and stuff, but you wanna learn about this.  Rocky: (19:21) You're gonna create like a little mechanism so that this stuff is dripping to you all the time. So that's why I'm saying like, sign up for people's email newsletters, subscribe to their blogs or whatever it might be. And just gradually in the background, start watching and observing and learning. Right? So that would be the first thing that I would do. Look at those people that you are following, that you find interesting and so on and start to really understand what they're doing, you know, and that may mean even, let's say they have a video out or a presentation where they sell something, record that presentation and transcribe it and start to actually study the words that they use, the language they use. What do they assume about the people that they're talking to? How do they talk about those people's problems, right. Do they know their problems really well?  Rocky: (20:11) Can they describe their problems in a way that when a person is listening to it, they go, that that person gets me. They totally understand it. That's what, right. That's what we wanna be able to do is have a person go. That guy gets me. He understands exactly where I'm at. You know, so understand how are they talking about problems? How are they talking about solutions? Do they have some form of a system that they bring people through to get them that result that they want? Right. So I would, first of all, study other people in the market and I would really learn about it. I mean, go to Barnes and Noble, let's say for an afternoon with a notebook, grab a few books on personal branding and just start understanding the space and understanding the concept. And then with that notebook as step three, I would start to look inside of yourself, what do I love to do?  Rocky: (21:00) What am I naturally great at? Where are my gifts and talents? How can I become kind of a personality, right? What are some of my interests? What are those things as a person, just as a human being that like other people find I'm funny, or I'm interested in music or wine or whatever it might be. How can I maybe take some of these things that make me interesting as a person and start to blend those into what I do professionally to make me kind of somebody that other people wanna listen to and we'll connect with other people. So those are just three of the first steps I would take to just dip your feet in the water and get used to that.  Outro: (21:43) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Read the report Diversifying Global Accounting Talent: Actionable Solutions for Progress  Full Episode Transcript:Adam: (00:05) Welcome back to Count Me In, the podcast that explores the world of business from the management accountant's perspective. Today, we have a special edition as we take a closer look at the groundbreaking new DE&I solutions report produced in partnership by IMA, the International Federation of Accountants, or IFAC, and the California society of CPAs. The report, entitled Diversifying Global Accounting Talent: Actionable Solutions for Progress is now available on the IMA website. Just follow the link in the show notes. Here now to discuss the findings and why this report represents one, if not the largest collective of DE&I initiatives in the history of global accounting profession is Jeff Thomson, the president and CEO of IMA, Kevin Dancey, CEO of IFAC, and Denise LeDuc Froemming, president and CEO of CalCPA. Let's get started.  Jeff: (01:03) Well, thank you so much, Kevin and Denise for joining this very, very important podcast. We're all committed to increasing the relevance and influence of our great profession and talent pipeline and talent retention, and certainly diversity, equity, and inclusion is an important part of that equation. I'm very, very proud and honored to have partnered with both IFAC and Cal state side of CPAs in this groundbreaking DE&I research our organizations have collaborated on over the past bunch of months. I believe that the breadth and depth of topics covered and really getting close to the issues at hand is arguably unsurpassed by any other study out there, but it's not a competition, it's about improving the profession and its its relevance and an age of disruption and uncertainty. You know, there were some hard truths, hard data points that came out of the surveys that we did both in the US and around the world, the Middle East, Africa, Europe, and Southeast Asia.  Jeff: (02:07) Speaking about inequity, for example, fewer than 60% of the 8,000 sampled believe the profession is equitable or inclusive, that's a startling number. And so it very much is a call to action to partner together, to understand how we can create diverse pipelines, how we can create an incredibly diverse and inclusive profession because of an overarching perspective that improves the attractiveness of the profession to all types of individuals and our relevance and influence going forward is absolutely paramount. Look, we can't touch on every point in the research that came up in this particular podcast, but would love to hear your reactions. For example, to the more than 70 specific actionable practices recommended in the report. These over 70 actionable practices have been mapped back to the 17 UN sustainable goals, sustainability goals for 2030, for example, goals on quality education, gender equality, and reducing inequality.  Jeff: (03:14) So let's talk about some of the findings and I need to be quiet and listen and learn. So according to the research, there is greater diversity across the broader profession than in leadership positions. In a comparison of female respondents, job titles, across all regions, to those of male respondents with similar education levels and experience, it was revealed that male respondents are holding more senior positions than in females. And that typically also extends to other diverse groups. Second, the research points to women and members of other diverse demographic groups in each region believing there is some level of inequitable treatment and exclusive behaviors that impacted career decisions and prompted some actually about 12% to actually leave our great profession. So starting with Denise as a leader in our profession, what is your reaction to the findings in this area of gender and other forms and inequities, inequalities, and similar challenges you're facing in a very diverse state of California. Denise?  Denise: (04:28) Well, thank you first. Thank you, Jeff, for having me on the podcast today really appreciate being here and also thank you for just, we really appreciate partnering with IFAC and IMA on the survey. It's very important as you said, and there's a lot of great actionable items, which I was so happy to see within the survey, cuz it gives others a pathway to move forward. So that's important. You know, in regards to gender parity, I think COVID, we could all probably agree that it didn't really help on the advancement and the momentum that we had in 2019 on with women within the workforce. A lot of women left to take care of their families, no judgment there it's just what happened. It's the reality. Often I think women and diverse populations are underutilized within the profession. They aren't provided the opportunities to stand up and to learn new skills or competencies.  Denise: (05:24) So I did talk to Dr. Mithu Dey from Howard University. And she had said too, that there's research out there. And she mostly looks at the black accountants and their experience, but she said advancement and retention challenges are really the result of them not obtaining assignments that help them develop. And they don't have the social networks a lot of times to provide that informal career advancement. And I think we could all agree. I know myself that I've benefited from others helping me to move ahead, giving me opportunities. And if you don't have that, that's definitely a gap. And it also provides you with the thought that maybe you wanna leave the profession because you don't have the network and you don't feel that sense of belonging or welcomed environment within maybe the organization that you're in. And there's a lot of statistics out there that really promote the fact that there is not equitable treatment all the time.  Denise: (06:24) So a lot of times we say to see me is to be me. And I think, you know, Heather has said that at times as well, and it's really having that awareness and acknowledgement that there is a gap within the profession and understanding that gap. So you have to know where you're at to know where you need to go a lot of times. So it's, it's on the acknowledgement and awareness that the profession does have a gap. And then also the belief that there is an untapped resource out there and that will provide the leadership and the innovation to move the organization forward. And also having that as a priority within the organization and the tone at the top, making sure that it is within the fabric of the organization to have DE&I at the forefront and have programs that support that. So essentially having it hardwired within the organization.  Jeff: (07:17) Right. Thank you, Denise so much. And you know, before I turn it over to Kevin, I think three of us would probably agree very, very passionately that we've got a great profession. We need to do a better job at telling the story of the professions, making a difference in society. But we also have to create a better story and to see it is very powerful. Kevin, what's your thoughts on the question of gender parity and retention or similar challenges for other diverse groups from an IFAC perspective, you get to see the world actually, which is pretty incredible.  Kevin: (07:51) Thanks, Jeff. And thanks for having me here today as well. I think Denise has covered a lot of the points quite well, but it's very clear that in terms of advancement and retention we really have work to do as a profession. I think it's showing in the data from the four regional studies, you know, more than 60% of female respondents as well as members of diverse demographic groups explored in each regional study report personally experiencing inequitable or exclusive treatment in the accounting profession that they have perceived to be rooted in biased against people like them. Also 12% of women have also indicated that these inequitable and exclusive experiences have contributed to their decision to leave the profession altogether. So these numbers are upsetting but reinforced that we must do more as a profession to ensure a comfortable, inclusive work environment. But I think, you know, one of the great things about that report is that now not only do we have some really good data to base our risk responses on going forward, but that the report really tries to get to pragmatic solutions that the profession can adopt. And I know throughout this podcast, we will delve into some of those as well.  Jeff: (09:12) Great. Kevin, thank you for those thoughts. By the way, just going back to, if we're allowed to go back on this podcast, but going back to something Denise said that I think you also alluded to is, you know, it does seem that disruptive events, whether it's the pandemic or other disruptions that we've all seen and felt does seem to disproportionately impact females, lower income caregivers, et cetera, et cetera. So we've gotta be very, very careful that as we plan for the future and make some bold steps forward, we take into account that things are probably gonna get more challenging rather than less. So thank you for that. So we've alluded to the fact that in this groundbreaking research there were well over 70 actionable practices that were put together through benchmarking through think tanks and through other means as we indicated earlier, they are mapped back to the 17 UN sustainable goals for 2030.  Jeff: (10:18) And there's many examples for instance, in attracting groups to the accounting profession. There's the thoughts of more communications and outreach to underrepresented groups. Are we being creative and innovative and comprehensive in our outreach to bringing in new talent into our organizations, things like anonymizing - am I saying that - anonymizing resumes prior to having them received during the recruitment process to minimize the effect of bias and these 70 or so ideas or initiatives or practices are grouped into two categories in the report, if you recall on the there's the attracting talent, and then there's also retaining and developing or developing and retaining. Another example is in terms of attracting talent developed partnerships with primary schools and local organizations that demystify accounting roles to youth. So even starting earlier, right in the bid to tell the story of this great profession. So Kevin start with you, what's your take on the 70 practices? How do you prioritize them? How do you get going? What are some things perhaps IFAC has done either on the attract and or retain developed side?  Kevin: (11:45) Thanks, Jeff. You know, while it appears as an easy to implement practice I don't think we should get ourselves and it will be quick or easy for that matter. Cuz I think removing unconscious bias from decision making really is a lifelong learning process. And we need to work on undoing, frankly, generations of systematic bias. You know, with respect to attracting talent, one de facto place to start which you alluded to is by utilizing software to remove names from resumes or gender specific language from job postings, because doing so puts the focus on the requirements of the job and the professional capabilities of the person without regard for demographic characteristics. So that's one example. I think another area that will be important for us to focus on is how we are encouraging young people to enter that profession to begin with.  Kevin: (12:40) And I think this gets back to the point you alluded to earlier in terms of getting our story out there and getting our story out there in the right way. If we don't have good diversity, you know, right now at that point, why not, you know, for people entering the profession and are the job postings off putting towards, you know, specific demographic groups? I think these are the questions we need to explore because ultimately our work starts with marketing the profession as a viable and desirable career path to all. And I think, you know, with all the work going on in the world today around sustainability reporting and ESG reporting, et cetera, I really think we can position this profession as one with a real sense of purpose going forward, which I think will be attractive to the next generation. So I think it's really important to weave that into our story going forward in terms of the sense of purpose that an individual can have and also how that will lead to a viable and desirable career path, kind of another effective place to start could be by providing internship programs to undergraduate students.  Kevin: (13:50) We've done this the last couple of years at IFAC and one of our interns from last year's summer program is now working for PWC. So again, just looking at different new ways in terms of engaging young people with our profession going forward. I think there are options there for to explore.  Jeff: (14:11) Great, great thoughts, Kevin, and as a proud member of IFAC, I wanna thank you and IFAC for its proactive statements and initiatives working with the IFS foundation, others to make ESG environment, social governance and integral part of our profession, where we can make a difference in terms of unbiased results and results with a reasonable level of insurance. It's all about making a difference and being a purpose driven organization. If we do that well, we will attract a whole new set of inspired students not to mention the move toward data analytics. So Denise, going back to you know, the question at hand, I know in some media interviews yourself and Heather on your team have done a really nice job at articulating some of what you're implementing at Cal state side of CPAs, but what is your thoughts as well on the 70 plus actionable practices and how organizations can get going get started and keep it moving.  Denise: (15:16) Mm-hmm, I do agree. I mean, with both of you that having that 70 actionable practices provides a starting point, a great starting point for anyone. It's kind of a menu in which you can choose where you're at and the next step that you wanna move forward on. So it allows you to customize in a way, a pathway or a roadmap forward. So I think that's helpful cuz everyone's in a different spot and they need to be able to see and have that pathway of how others have implemented. I think a good starting point first is to really have a committee or a group that can be that village or that team to help promote, nurture and support a program. Because without that, you are just going in many different directions, a lot of time and you don't have a focus pathway forward.  Denise: (16:02) So I think that's a really good beginning point for anyone and to make sure that you have the members and you have buy in from various groups and stakeholders, cuz that helps you move forward in a more deliberate and intentional way. I would say also to have awareness and look at, do an audit, to see where you're at truly, what are, what position are you in currently? Cuz then you can know, like I said before, where you need to go and what you need to put into place and share the plan with others, have that tone at the top, make sure there is buy-in by others because without that, it's really difficult to move forward. And I would agree with what both you and Kevin said on the story. We have to be able to tell a compelling story that resonates with different audiences. So it isn't always the same message, but it has an element of a message that is really at the heart of what others are looking for because every different diverse group wants something different.  Denise: (17:01) We hear that a lot of individuals that want to come into accounting want that are attracted to the entrepreneurship that is available. So we have to be able to tell the story in different ways that resonate with different audiences. And I would say it's, it is a profession I love, I wear my I love CPAs button, but it is my profession. So it's important to me that it is sustainable going forward. And I think we're poised to really comment on and be involved in many of the new initiatives that are out there, ESG being one of them.  Jeff: (17:32) Great. Great. Thank you. And Denise, while we're on a bit of a roll here, so, you know, we've spent a bit of time on the attracting talent and telling the story and making the story even better. Let's talk a little bit more about the retaining and promoting diverse talent for the longer term outcome of creating a sense of belonging, culture of belonging. You know, a quote I read on some of the research on hybrid work said belonging is all about leadership. It's not about location, right? Which we're all dealing with. I'm sure some of the recommendations in the report on the retain and promote side includes offering onsite daycare, establishing or expanding parental leave, collecting demographic data to assess equity Kevin's point about let's use data science to help in our recruiting efforts and regularly engaging with staff or members in a association, for example to assess employee sentiments toward DNI, DE&I, why are we even talking about it? Is that for us to be doing well? How is that an integral part of the profession? So what are your thoughts on some of these actions or, or thoughts initiatives in the area of promoting and retaining and how can we lead by example?  Denise: (18:48) I would say just to your point, facilitating that inclusive work culture and that sense of belonging is extremely important for everyone. And it isn't just, as you said, within the confines of the physical office space, but it is feeling that you're valued within that organization and having the DE&I programs that thrive in our avenues to really speak up and for you to be yourself at work, I've heard so many times is extremely important to everyone within the organization and to have that support with the tone at the top and having leaders that support kind of where you're going and understand really what you value within the organization and where you need to go professionally and having mentors. I think mentors are really important within an organization and sponsors so that you feel there is a pathway for you to move forward.  Denise: (19:45) And I hear that with the members as well, having that mentor so that they know the pathway that is available to them, cuz it's difficult sometimes to move forward and to know where to go and having someone that's in your corner that can provide the roadmap is extremely helpful. And I think a statistic that I've heard is that 70% of underrepresented racial and ethnic groups do not have equitable access to sponsors or mentors. And that's extremely important. Because we all need that support within the organization to help us move forward in our career. And without that, you just don't really know a lot of times where to go next and what that next step is.  Jeff: (20:27) That's great. And Kevin alluded to the importance of internship programs, but mentoring programs, mutual coaching programs we have to dig deeper and more innovatively. So great. Thank you so much, Denise, shifting gears a little bit, I'm sure we'd all agree that one of the cornerstones or table stakes for our profession is commitment to professional ethics. The international ethics standards board for accounting takes this very, very seriously. Kevin, the general question is what is the relationship between DE&I and ethics and even ethics codes, for example, should there be direct or indirect reference to DE&I in ethics codes is probably the broader question for consideration.  Kevin: (21:16) Thanks Jeff. Great question. I think I'd start by saying inherently ethics and DE&I are linked together. As accountants, we have a responsibility to uphold the highest standard of ethics and make fair decisions free from bias. So that's kind of a fundamental principle 101. And I think in the report, it's outlined that compliance along with the IESBA code of ethics principles can help support the effectiveness of DE&I programs. Now while the IESBA code does not expressly address DE&I it's overarching requirements note the importance of having ethical values that align internal organizational cultures to the principles of ethics in the code and compliance with the codes, principles of ethics can help support the effectiveness of DE&I programs, you know, for example compliance with integrity involves fair dealing. Fair dealing includes respecting and promoting values of DE&I. Also compliance with the principle of professional behavior lead a professional accountant to avoid being associated with discriminatory or biased practices that are not aligned with fundamental tenants of DE&I, and consequently, the organization's DE&I related programs and policies. The code also imposes our responsibility for professional accounts to take action if they become aware of or suspect non-compliance with laws and regulations, which would include DE&I related laws and regulations. So there's quite a bit of connectivity and alignment between DE&I and ethics for professional accountants.  Jeff: (23:00) Thank you, Kevin so much for those thoughts on the fact that DE&I, and sound ethics are linked and joined at the Hep as mutual enablers. We already talked about the fact that as we evolve into ESG: environmental, social and governance aspects, that there too a diverse, equitable and inclusive environment goes hand in hand. So the S, the social aspect of ESG talks about human capital and board diversity, and so very, very, very important for professional and accountants and business to play a leading role. So, as we wrap up, as we know, more than 60 professional accountancy organizations around the globe joined us as we call DE&I advocates committing their organizations to collaborative action for change. This is a grand opportunity to address and mitigate the risk and seize opportunity to grow and expand the diversity, relevance, and influence of our great profession. So, given the magnitude of this and the opportunity here, start with Denise, what closing thoughts would you give to kind of capture the path forward?  Denise: (24:14) I would say first, just have conversations. So you understand where you're at and you have the awareness that you need, and then take action, take a step forward, lean in and do something. Because a lot of times there's a lot of conversation and we need to really take action. So I would urge anyone who signed on our CalCPA members to take immediate action and utilize those 70 action steps, select one, reach out there's organizations that are noted on there, reach out to an organization and ask for help because everyone will help and assist. And they're more than willing to give you a hand up. So I would say, have a conversation, take an action and enlist those leaders and stakeholders that you feel could help you move forward. It's extremely important. And just, we're so happy that we had the 60 that signed on cuz it shows the interest and the commitment to DE&I, and moving forward.  Jeff: (25:12) Great. Thank you so much, Denise and a hundred percent agree having conversations and many of them with multiple stakeholders critically important. Kevin, what are your closing words of inspiration here? Put you on the spot.  Kevin: (25:27) I think the important next step, Jeff, is to begin to take new actions as a result of what we've learned and the report generated an inventory of more than 70 actionable DE&I practices each map to relevant UN SDGs, which millions of accountants can implement. And as you said earlier, the actionable DE&I practices fall into one of two overarching categories that represent necessary strategic objectives for the accountancy professions, DE&I efforts, the first was attracting diverse talent and the second was retaining and promoting that diverse talent, effective solutions are needed to increase representation at all. Career levels, effectively measure DE&I progress and at coordinated, widespread improvement across the profession. Bottom line, Jeff, is that the time is now to affect change and unite the profession in a collaborative approach to solving these challenges.  Jeff: (26:21) Great. Thank you so much, Kevin and IFAC, and Denise and CalCPAs. It's been a privilege speaking with you today. I can't tell you how proud I am personally, and on behalf of IMA for partnering with you on this groundbreaking and actionable research. Look, we all want a fair and equitable workplace where people feel valued and belong, a sense of belonging and it's talent that's gonna move this profession forward more than anything else. And you know, when you think about it nothing less than the future relevance and influence of our great profession is at stake. So let's approach this challenge as Kevin and Denise have said with a sense of urgency, a sense of pride, and a sense of inspiration.  Outro: (27:07) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Connect with Nick: https://www.achievers-mindset.com/tools           Full Episode Transcript:Adam: (00:05) Welcome back to Count Me In, the podcast that explores the world of business from the management accountants perspective. I'm your, host Adam Larson. Today we are joined by Nick Davies, an executive coach to leaders and other professionals looking to take their expertise to the next level. At the heart of Nick's coaching philosophy is what he calls the achiever's mindset and how learning to harness that powerful mental tool can lead to transformative results for management accountants, and other go getters in both business and in life. I hope you enjoy the show today. Let's start the conversation with Nick.  Adam: (00:42) So Nick, thank you so much for coming on the podcast today. We really appreciate you spending time with us. And today we're gonna be talking a little bit about the achiever's mindset, but before we get there, I'd like you to kind of give a little bit of your background for our audience today and how you got to the point where you are today.  Nick: (00:58) How long have I got? You know, it's interesting. I was having this conversation yesterday with someone about talking about their story and fantastic story this lady had working in a business and it's something that I made a distinction of a long time ago that I had a resistance to share in my story. And I thought, well, who wants to hear my story, it's my story? And then what I realized was that, yeah, it's boring to me because it's my story, you know? So I always like it when people can share, because even if it feels like it's just your thing, it's like, well, other people haven't had that experience, you know? And so for me grown up in England, I worked for almost 20 years in the banking world all over the world. I've lived in three continents and five locations and been a long time doing something that I didn't really want to be doing and kind of went outside this personal development journey about 10, 12 years ago.  Nick: (01:51) I asked myself like what did I wanna do when I grew up, you know, eventually moved to states and lived in Florida, worked on Wall Street for a while and, and decided that's it like I wanna, I like working with people. I wanna work with people working on what's most important for them, whatever it is, whatever industry, industry agnostic, but use my experience working in the corporate world and understanding how things work, but also work for people's goals that are most important to them. And so I'd ask to become a coach. And it's been an amazing journey over the last six or seven years. This point, coached hundreds of people, people walk different walks of life and a corporate setting, every different industry, business owners, non-business owners worked on more people's part of life. And it's something I get very passionate about now. And I'm privileged to do every day.  Adam: (02:35) As you were talking, it kind of made me think about a lot of us are we may feel successful where we are in our careers, but despite having a pretty good handle on it, we feel like we're missing something, right. We feel like we're missing. We wanna be a top performer. And, but how do we get to the next level? So maybe that's kinda where we're gonna focus in on the conversation is how do we boost our skills and wherever we are, you know, this podcast is for folks, affecting the accounting and finance world. So accountants and folks in the accounting and finance world, how do we get to that next level? You know, we're not talking about specific accounting things right now, but it's just that, you know, how do we become successful in the next moment?  Nick: (03:12) And I think that you talked about skills and you talked about, yeah, we don't wanna talk about the technicalities of mechanical and finance. That's not the point. And so what I found out, what I believe is that right. It really starts with, well, where do you wanna go? What type of person do you wanna create within yourself? What type of life do you wanna create, rather than looking for skills or practices or best practices or strategies it's like, let's start with the best version of what it could be. What if you could have it anyway, you would want it, like, what would that look like? And really start from that point. And oftentimes that comes with a resistance, like, well, what do you mean? I wanna get 10% better this year. I wanna get 20% better this year. It's like, well, that's great and good for you, no judgment. But what if you could flip it on its head? What if you could get a hundred times better? What would that mean? What actually does that look like for you? And if you're thinking with that end in mind, then you tend to find the path to get there.  Adam: (04:12) So if you're thinking with that end in mind, how do you get to that, that change of mindset because you're here and you're like, I just wanna improve like 10% you said, and you just mentioned a hundred percent better. Like those seem like very drastically different numbers  Nick: (04:27) Yeah, absolutely. Right. And some of it starts with being willing and something within, could you start to, to talk about, right? Like some of us consider ourselves successful, but maybe there's something niggling inside you go, well, maybe it's not quite what I want, or maybe I could be doing this in a different way. And it's really kind of leaning into some of that. And I believe that we all have it. And a lot of us go through a life scene, a little bit of a fog, sometimes a lot of a fog just doing what we think is the right thing to do. You know? And I think about when I got into banking, I felt was like, well, that's good. They wanna pay me to do this. All right. And I'll play your game. And then they're gonna pay me some more and I'll play some more, I'll get paid some more.  Nick: (05:09) It's like, and it just goes and goes and goes. And that's really all, you know, and it's not often you just get to chance to step back and go, well, hang on. Is this really what I want? Like deeply to my core. Do I get excited to do this every day? Does it keep me up late? Not just because I'm told to, or that there's deadlines or is it cuz I want to, am I getting up early to go and practice to be the best version of this? And that's a question that like hand on heart that I believe most people can't answer. And I believe that that was just something that wasn't available for me. Like that wasn't the sort of person that I was. I thought that stuff was preserved for small stars or, you know, people that are in a creative field, but I believe it's available for everyone if you're willing to look.  Adam: (05:52) Hmm. So if you're willing to look, maybe we can start talking about, can you define the achiever's mindset for us? And we can discuss that a little bit more.  Nick: (06:01) Yeah. I think that, you know, the achiever's mindset is really about knowing that like there's always something else. There are no limits to what we can achieve. The baseline, the achiever's mindset for me is that I believe that anything's possible. If you think about what humans have achieved, just watching, me, my wife sat down last night to watch Netflix. We were watching the SpaceX documentary that was on there. And that what a great example, that is about what we could achieve. You know, even Elon Musk said, when we first started out, I thought there was a 10% chance. We'd get someone to orbit and it just comes from a place of look, I'm willing to move forward. I'm willing to throw the other paradigms out. I'm willing to think a little bit differently.  Nick: (06:50) I'm willing to just explore. It's not like I'm gonna be committed no matter what. I'm just willing to explore. I'm gonna go from the baseline that anything's possible. And if you think about it, that's one example, but think about what we've achieved as human race, but just in the last 10, 20, 30 40, a hundred years. It's ridiculous. And so pretty much I believe that human possibilities is pretty much endless capabilities there. So we're all human. So what's the difference. The difference is deciding that you want to go and get some of that or get more of that. And the more that you play in the sandbox, in that space, the more that your mind starts to expand. And then you start to see other possibilities, you start to play with it, right? So it's more like it's a starts from that baseline that anything's possible. That's what really the human mindset is as a starting point.  Adam: (07:40) So that sounds wonderful in theory. Can we maybe focus in on maybe some more practical application of that, and maybe you can share some examples of, you know, we don't know if you give any names of folks who've been able to take this mindset and do something great with their careers.  Nick: (07:57) Yeah, absolutely. And that's part of it, right? Like it's like, well, the theory and translating it into the strategy, right? Cause as soon as you get to the strategy, you're back to the how, when you're in the how it's like, what come on, I need to see the actual practical steps right now. It's like, well, that kind of defeats the purpose. It's a balance, right? To balance going, okay, well here's the part where like anything's possible. And those people oftentimes get called dreamers, playing the sky, blue sky thinking. And those people that are working on the practical things are looking at those people going well, come on, man, come down from a cloud. So you need to make that practical. You need to make that actionable. And you, those people are actually absolutely right. But these people up here without these people who wouldn't be able to create things that aren't available right now, we wouldn't best dream.  Nick: (08:46) So where's the right place to be. It's like both, right? Cause if you're up here, you can't do the action. And if you are down here in the weeds, you can't see where you're going. I love the something I thought of a long time ago, Adam. I just love the thought of like being in a jungle. Like let's say you're in a jungle and you're with a bunch of people and you've got like a machete and you're hacking through the jungle and you can only see what you hack down in front of you. And you are heading towards a camp for the night. Let's say a direction. You're gonna try and find something. And you've been doing this thing for hours, just hacking away, hacking away going, are we in the right direction? And everyone in your group's getting a bit fed up and tired like, Hey leader, Hey boss.  Nick: (09:20) Like, where are we going? Are we there yet? Are we there yet? And everyone's getting a bit uptight cause they're not quite sure. And they're like, you're going the right way, going the right way, hacking, hacking, hacking more and more effort. And you know, this helicopter comes past, right? And you're like gives you a rope to jump on. You, jump on the rope and you get wood up to helicopter from the helicopter and you see everything and you see the whole jungle you're in and you see exactly the whole place of where you're supposed to go. And you can notice that, look, you know what? I'm 200 feet from where I wanna be going. And so you can come back down into the jungle. You go, Hey guys, we've got it. 200 feet. Now the mood completely changed.  Nick: (09:53) The outlook completely changed. What they believe is possible, completely changes. Cause you go 200 feet in that direction. And then you're there. It's like from the place in the helicopter, you can't do the work. But if you haven't got the outlook and know when to get back into helicopter, you're gonna quickly drive yourself into place where all you believe is all you doing is go around in circles, go around in circles. And that's the balance to get to. Right? It's like, there's no, here's another way to think about it. Right? Oftentimes in life we think binary it's yes or it's no, you're in and you're out, but really life is more of a scale, right? It's like one extreme to the other. There's so many stops along those ways. So it's just, what's the right balance. And so if you find yourself bias in a particular direction, which most of us do, everyone has their biases. No good or bad. Just that's just our, and you might say, okay, how might I lean get a place to perhaps open up some more possibilities?  Adam: (10:47) Yeah. Everything you said kind of helped me think about in lot of different directions, but it's great for leaders to be able to take that, you know, helicopter trip up to be able to see everything and say, okay, this is where we need to go to help your team, understand the why and what we're doing and get that morale going. But what if you are standing there watching your leader go up and you're like, wait, but I wanna see up there, how do you get from where you are and go up there because maybe you're a staff accountant and you're just in the numbers every day. But you want to get to that CFO level so that you can see all the things. What's that first step you need to take?  Nick: (11:23) Beautiful question. Thanks Adam. Thank you for contextualizing that, that's really powerful. Yeah. You you've got to, especially in organizations, you've got to make sure that you're still playing your own game. Right? So for instance, I worked with the quite a few financial advisors. There's a guy that I worked with this morning and like here's a particular goal that his company's given him for a certain amount of transactions and dollar value for the year, of course. And that's the goal that they've given him. And so, okay, this is what you need to go and produce. Now that's based on what they think that they need in totality. There's some general generalities to it as well. Cause it's spread across many different people. And what we work on is what's his actual goal within that? What does he own? Right?  Nick: (12:07) So if you're the junior guy looking up to the CFO, you've gotta go look, where do you wanna be going? You've gotta get your own helicopter. And you wanna make sure that either it is in line with where the helicopter's going for the CFO, for the company. And you've gotta know that. And if it is awesome, then you can plot that path within that. Or if it's not, then you wanna know that as well. Then you can take a different path. It's really knowing where you are going either inside of someone else's game or creating your own game. And again, that's part of the fog of it. It's like, all I can do is I've gotta wait for the next person to move up, to move up again. It's like, are you really playing your own game? Or are you playing someone else's game?  Adam: (12:45) I really like what you're saying, there is you have to get your own helicopter. You can't use your current CFO's helicopter. You have to get your own helicopter so that you can start to see where you need to go. You can't focus on his journey. I mean, you can learn from their journeys. You can learn from steps they've taken, but you can't jump on their helicopter and expect to go the same place.  Nick: (13:05) Yeah. Like, and if you are good with that, then that's fine. But it's having the awareness to know that you are on someone else's journey. Yeah. Like if you haven't got a plan for your life, you'll end up fulfilling someone else's plan. You'll be part of that. And there's nothing wrong with that. Again, just having the outcomes or the awareness to know what that is. I think it's really, really powerful.  Adam: (13:25) Yeah. That is very powerful. And I think the other thing that I was thinking about too, is if you're sitting there, you know, you've gotten your own helicopter. You may recognize that my journey will not continue at this organization. Maybe my journey needs to go to another organization. And so, you know, that's a scary place to be because you, you may be just early in your career. And you're like, if the place I want to go is over here, but I see that my journey is not gonna stay here. And you don't know, like there's a lot of unknowns there. And the unknown is very difficult, especially when you're trying to, you know, trying to change your mindset.  Nick: (14:02) Yeah. We are people, all people are driven or not as the case may be by fear. And whether we wanna admit that or not, that's really what it is. And certainly true for me. I can tell you that for nothing, right? Like it's something that's always coming up. But what we do is we tend to optimize for the fear of taking action. What we don't tend to think about is the fear of inaction. And that's for me, the biggest opportunity cost. It's like if I take this, my journey is not at this place, it's like, oh no, like now I'm not in a place where I wanna be. That's scary. I've gotta make some change. I've gotta like, get uncomfortable. I've gotta move to somewhere else. I've gotta figure some stuff out. True. But the alternative is that you don't make a change.  Nick: (14:51) Even though it's something in you that tells you, that's not quite right. You don't make a change. You follow the beaten path, you do the things that you're supposed to do. You take the next part up, you take 10% and 10%. And then somewhere down the line, 10, 15, 20 years, goodness could be, you go, oh man, I've just spent 20 years in a place I didn't want to be in. And that's what I get so passionate about what I do. Now I honor my journey. Cause I did spend 20 years doing something I didn't wanna do. And it gave me a lot. And that's exactly what my path has been is supposed to be. And now I get to share with people, right? Let's come back and compress some of that time. Cuz deep down. I knew if I'd really ask myself the deep questions, at any of that spot, I could tell myself that like this isn't the right thing. Gotta start thinking about doing something different and figuring something out. And it doesn't have to be a huge change, but just be honest with yourself.  Adam: (15:42) So if you're being, I like the idea of being honest with yourself, cuz that's something that I think a lot of us kind of struggle with and just growing in our careers and our personal lives is being honest with ourselves. And I think something we need to remind everybody is, is that these journeys, this getting to these mindsets is not something that happens like today I'm here and then tomorrow I'm gonna be at a hundred percent. No it's an actual journey that takes time. So yeah, you may be taking those incremental steps, but eventually that helicopters and you gotta grab on. Right?  Nick: (16:14) Absolutely. And that's why playing up at this place, which feels like it's pie in the sky and going what's that difference between 10% is that what's a hundred percent, it's it's opening possibilities. It's saying, well look, what if I could have it any way I want it to be? And if you let's say, you're just starting out in where you are in your accountancy career, let's say you're like, okay, what do I wanna do? What's the best version of this. If everything went exactly as I wanted it to go, if I could snap my fingers and create that, what would it be? And you might say what for because I can't get there yet. There's no point, but the sooner you can do that and create something, you have a place to move towards and your life will start to optimize for that just naturally cuz you'd be thinking about it and then you can take actual action, make it real, take those steps. And you might also say, well, I don't know yet. Well, part of that is also a game of just doing what's the right thing for right now. Oh and by the way you could also say I'm not prepared to do anything on that yet, but either way, you're being honest with yourself and being intentional about what you're doing.  Adam: (17:23) Yeah. That's so important is that you may not be ready for the next step. And this idea of like, you can't always be in the clouds obviously, because you'll never get anything done, but you can't always be in the weeds cuz then you'll never see the big picture. Right. So finding that balance. So we've talked about the person who is early in their career. So maybe let's talk about leaders. You know, I'm a leader and I have a team of 20 people and I'm like, okay, I wanna have this achiever's mindset. I wanna see the big picture, but also see the practical. I wanna find that balance for myself and then also teach it to my team. How can leaders help get their team to a place where they're starting to find that balance as well?  Nick: (18:06) Yeah. Great question. Thanks Adam. And so first things first it's knowing as a leader, where are you going? Can you specifically articulate super quick, what is success for you by the end of this year or the next relative point that you're looking at in your career or that business line or that area of focus. And then when you know what that is and what you are doing every day to get you there, even without sharing it, people gravitate to that because that's the guy that looks like he's got everything figured out, right? It's like, you can tell it when you even look at people, right, when you're walking around the office, if we do that anymore, right? And you see people and the people that know where they, you can look at people and go, that person knows where he is going.  Nick: (18:48) And because he has an in intentional outlook of what success looks like to him or her that day, that week, that month, that year. So that's the starting point, right? And that will create people will naturally follow you anyway, people in your team. That's what leadership is. Management is the sorting it out and figuring it out. The leadership is just doing the thing and people follow that people will gravitate towards that. So it's, first of all, knowing what it is for you and as a leader, likelihood your goal, your vision is something that's bigger than you. Anyway, you need to enroll other people in it. And part of your power as leader and part of your requirement, your responsibility as a leader, is to be able to share that, share what that is and articulate in a way that we can attach to it.  Nick: (19:29) Right? And sometimes people will share that. Like, I'm not thinking about this emotionally. I'm not thinking about it in that way. I just need to do these things, do that. And I get that. It's like, alright, cool. There's a practical sense to it. If I do that, I do that. And now I get that, but everything has emotion tied to it. Everything is tied emotionally. And if you don't think yourself as an emotional person, and then there's a reaction to that, no, I'm definitely not an emotional person. It's like, well, that's an emotional reaction. We can't get away from it. Right. And then we should honor those feelings. And however, that means to you, how it show up, everyone's a bit different, but that's part of it, knowing, be able to articulate that to your team is a really good step.  Nick: (20:09) And then again, going back to being honest, this is where we're going as a team. And this is where I wanna go overall, are you on bull face? So you are helping them. You are in your leadership helicopter to extend the analogy, looking back at the other helicopters, going, Hey guys, or looking back down on the fit, down in the jungle, going, Hey guys, are you in your helicopter yet? You wanna hit your ride on mine? Cause I'm going over here. So you are creating a way of, so some people might not be ready to get in their helicopter yet, but you're saying I got mine. Are you willing to get into it with me? Cuz we are going this journey as well. Right? So that's really what it is. Now, once you're aligned, all the things that are part of it, which is basically communication will figure themselves out. We can't go anywhere until we're aligned.  Adam: (20:53) I like that picture of there's times where we, as leaders have to pick people up and carry them with us and saying, Hey guys, come with me. See what it's like up here. And then here look your helicopter's right there. Jump in. Right.  Nick: (21:08) Yeah. Absolutely. And all done with like no judgment. And it's like, this is where I'm going. I'm all in. I'd love it for you to come. And if not, then I wanna know that as well.  Adam: (21:17) Yeah.  Nick: (21:18) Because it can be, and I've been in leadership positions where it's just like, what's wrong. Like this is what's laid out like this is, which is what you signed up for. Like why can't you do it? What are you doing? And there's so many things to pick out of that. Like they might not have signed up for that. Where do we have the explicit conversation about this particular thing, we might not have done! And I'm judging them in that moment. I'm saying like, what's wrong with you? Or I'm implying what's wrong with you. And when people feel like they're being judged, they're gonna shut down. They're not gonna play. And so the goal always is to think about things like, okay, well where do you want to go, and put yourself in their shoes and create the opportunity for people to step into it. Right. Rather than close things down. And so that's a real big part of it.  Adam: (22:03) So as we wrap up our conversation, I think this has been really great. Just kind of understanding this achiever's mindset. It seems like there's one word that you may have said it already, but there's one word that seemed, or it's a hyphenated word I should say, that seems to be very important in this whole thing is self-awareness. You need to be aware of self, of how you're feeling of how, where you are in your journey, because that's where we have to start. Maybe we can talk a little bit about self-awareness and how it connects to everything. Cause I feel like that's a real connector for a lot of this that we've been discussing.  Nick: (22:38) Absolutely, absolutely. Adam. Yeah, self-awareness is great. I just call it awareness because it fits within the model, which I think that we live in and everything starts with awareness. Without awareness, you are nothing. It's not everything by itself, but it's a place that we need to start. Right. Cuz when you can understand where you really are and be honest with yourself and like, if you're gonna build anything, you wanna dig down first, make sure you've got the right foundation. So that's what awareness is. It's like taking stock. What's really true. What's really important for you. Where are you? Yeah. And then that awareness then allows us to jump off to action. So I call this the Triple A approach, right? And I believe, I mean that's semantics, but I believe we're always in this Triple A approach, it's a cycle of life.  Nick: (23:23) So awareness knowing where you are jump off to the action, which is actually creating a plan right back down to the very specific roadmap of where we're going. Like that's the actual strategy, the tools, skills, all that stuff is very important, but we can't do that until we start with the awareness part. So we move off into the action plan and the action is now, okay, this is where I'm specifically going over this particular milestone, this timeline I've defined, here's the action I'm gonna take. And then that last A of that Triple A approach is achievement. And the achievement part is the checking in part. That's how we know whether we should be up on the helicopter or down in the weeds because it constantly changes. And so every week can say I work with my clients every week we come back together, go, did you do the things you said you were gonna do?  Nick: (24:09) Oh, great. What results did you get based on that? Good, bad, different? Again, again, again. And you know, life happens or sometimes it'll be like, I didn't do anything. Okay. Where do you wanna get back to now? Cuz without that last ADA achievement, even if, here's the scariest part, Adam, perhaps is that you see some self-awareness to call it your way and you start to go, yes, I'm committed to this. I've thought about something that's completely different. You start to take action, you have a little plan in place. And then something happens. Life happens, you get smashed in the face, emotion and you get hit down. You forget it. And you come back to it a month later six months later. A year later. And it didn't happen for you and you think, oh man, it must be me.  Nick: (24:52) So it must be wrong with me. Maybe this isn't on the cards for me. And it's just the process. And that's like the scariest thing, cuz the next time you get yourself back up again, you're gonna be a little bit less certain than you can. And that could have been a year gone by. But that's why it's so important to have something around you with that accountability and that place where you can check in every week. Cause the maximum you can lose is a week. I get very passionate about this because I know how powerful it can be to keep in that space.  Outro: (25:19) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Read the report here: Management Accountants’ Role in Sustainable Business Strategy: A Guide to Reducing a Carbon Footprint Connect with the Speakers: https://www.linkedin.com/in/arnaudbrohe/ https://www.linkedin.com/in/jaxiefriedman/ https://www.linkedin.com/in/regisedu/ Full Episode Transcript:Adam: (00:05) Hello again, welcome back to Count Me In, IMA's podcast exploring the world of business from the management accountants perspective. I'm Adam Larson and today we are discussing exciting new thought leadership from IMA, which shows how management accountants are on the front lines, making businesses more sustainable. The name of the report is Management Accountants Role and Sustainable Business Strategy: A Guide to Reducing Carbon Footprint. And I'm excited as brought some of the researchers and authors involved in the project here today, including Kristine Brands, management professor, the US Air Force Academy, Arnaud Brohe CEO of Agendi, a leading consultancy for climate and sustainability programs, and Jaxie Friedman, a sustainability consultant at Agendi. Make sure to follow a link in the show notes to access the full report. Let's start the conversation.   Adam: (01:03) So before we can talk about reducing carbon emissions for a company or for anybody, we kind have to start talking about the drivers that kind of led us up to this point that would make companies and other folks realize, Hey, I need to start paying attention to this and can, so let's start there. Kristine, can you, can you start that off for us?   Kristine: (01:21) Yes. Before I speak, I have a disclaimer because I work for the Air Force. The views that I am speaking about are entirely my own and do not reflect any policy or position from the Air Force, the Department of Defense or the US government. Drivers are huge and what astonishes me is the awareness and the rising of the consciousness of people towards climate change. And they take several dimensions of clearly external and the physical drivers, which are the data behind climate change and the astronomical risk that we're facing globally as a society. And that carries over to internal drivers, into organizations that are going to be put in a position, which I predict is going to come faster than people can imagine to address that risk as well as their strategy so that they can adapt and adjust and be agile to the threats that we're all facing as a society.   Adam: (02:34) Arnaud, Jaxie, do you have anything to share?   Arnaud: (02:37) Yeah. I agree with what Kristine said. I just think that people don't realize how fast this is going to evolve. But that's critical. Basically we have 10 years to change the way we consume, the way we produce, the way we are organized as a society. We have 10 years to start thinking about how to change our mobility systems, you know, shifting from thermite combustion engines to electric cars, that's going to be very visible, but that's just the tip of the iceberg, frankly. We have, we need to revolutionize the way we consume energy in factories, the way we consume energy in agriculture. So the changes are just enormous. The drivers of course are the physical climate risk, but that's not the first drivers that companies are going to experience what we see today and taking the automotive industry as one example, to trade is that transition risk are going to affect businesses even before physical risk and by transition risk I mean, the pressure that customers, the regulators, governments are putting on existing businesses. So if you are an automotive manufacturer today, and you wanna sell your car in no way, or the Netherlands or Germany, you better be ready to switch to much more efficient cars and to gradually shift 200% electric cars. And we know that these trends are going to come here as well in the US and in order jurisdiction.  Jaxie: (04:03) Yeah. I think it's true. What both of you guys are saying that, you know, the science is showing it's, it's more and more significant and gonna be incredibly problematic, but I also think that there's in relation to that a lot of pressure coming from businesses and consumers as well, that is really driving this action. You know, of course it's true that the science is showing that more work needs to be done. But I also think that there's more awareness around that fact. So it's not just a matter of, you know, the, IPCC reports saying that, you know, there's targets we need to hit. It's also a matter of more public awareness that's trying to push us forward. And some of that is, you know, more just reputational. So investors encouraging companies to be integrating climate into their business strategies. Some of it is regulatory like Arnaud I were just speaking about kind of the SEC regulations and how there's kind of current movement towards there being potential regulatory requirements related to climate. And I think, you know, the fact that, you know, those new SEC kind of papers have come out to suggest that we're moving in that direction, I think is gonna be continuing to intensify the speed at which climate becomes integrated, not just into sustainability functions, but across entire business operations.   Adam: (05:44) So it almost seemed like you needed the customer and the government regulators to say something cuz otherwise businesses probably wouldn't have done anything.   Kristine: (05:54) I think you're absolutely right. There's been a lot of resistance. There is pressure. There's reputational pressure as was mentioned, but the real push is to pass the regulations which the European union has done. And there are daunting proposed regulations from the SEC. And I think that that's what is necessary to close the deal.  Jaxie: (06:22) I think also, you know, it depends company to company. I think, you know, considering company culture is a really important factor. There's more and more businesses that really have sustainability within their DNA evolving as it's becoming a bigger part of our society as climate action is becoming more integrated at a public perspective. So I think in order to move the needle among kind of the mainstream body of companies, I think it's completely true that the regulatory pressure helps really push things along. But I also think it's important to acknowledge that there are many companies that have taken really huge steps in this direction before regulation was even on the table. And so I think it's important to consider that fact, I think that, you know, a lot of companies get a lot of or you know, with a corporate world in general, I think gets flack that they're, you know, the causing so much of the emissions and that they're, you know, the source of the problem, but the truth is like also, they're also a big part of the solution and they've been a real driver of innovation towards our climate solutions.   Jaxie: (07:31) And so I think it's important to acknowledge that I think regulation is not, it is a kind of like a compounding force, but I think even in its absence, there've been a lot of massive growth opportunities that have evolved because of companies that are really, you know, recognizing the need even without the enforcement.   Arnaud: (07:55) To compliment what Jaxie just said, that I would say we should stop thinking about seeing businesses as when homogeneous group there will be winners, there will be losers. You know, when we analyze climate risk with our clients, actually what we do is analyzing climate risk and opportunities. If you are an oil and gas company, of course like your future is less exciting that if you are renewable energy company does not mean that you will go out of business, but you need to reinvent yourself. You need to start, you know, investing in biofuels, investing in carbon capture. You know, you also need to think about diversification, you know, like, should you have all your assets deploy around all exploration? Probably not. Like if we read the IPCC, we clearly see that we should stop drilling oil, you know, that in the long run. So, but of course that's not the same story if you are, you know, developing alternative meat, if you are developing electric cars. So really I think regulation and businesses can go end in end, but we need to have that common goal to significantly reduce our greenhouse gas emission, simply because that's the survivor of the human species, which is at at least like the quality of life that we enjoy today, which is at stake.   Adam: (09:06) I mean, that's hugely important. I mean, we all kind of want to still be around on this planet and enjoy this planet for years to come. So bringing it back to since this is a podcast about all things affecting the accounting and finance world, how, what value can management accountants really bring to this process of, you know, making this important in an organization and, you know, going through it?   Kristine: (09:29) I think they are an essential part of the process and the progress that needs to be made. And you can look at it from the high level of their traditional role of gathering data and information and creating reports and acting on those poor decision makers. But it really transcends that they are ideally suited because they're a part of the inner, they have the tools, they've got the toolkit that they can use to create value. And that's what it comes down to, creating value in their organization. And just to name a few, there are cost benefit analysis and that's something that interface corporation in Georgia used to completely transform their strategy from profit bottom line to sustainability goals and objectives. We have the gap balance scorecard, which can be overlaid with a sustainability perspective developing a strategy map because if you're really gonna change the direction and the trajectory of organizations, you've gotta integrate this into the organization.   Kristine: (10:48) That's what management accountants do. And very, very importantly, the reporting is not standard financial reporting. We're focusing on non-financial metrics, sustainability metrics, so they can customize those within their organizations, do peer analysis with their industries and come up with a reporting framework where the results can be presented and then to do the capital budgeting analysis which is also tied to implementing innovation within their organizations to be able to look at new ways to do things. If you're an airline, maybe you're going to weigh everything that's on that plane. You need metrics and capital budgeting analysis to invest in that. I honestly think that the management accountants are the center of the reporting in their organizations to partner with other members of the organization.   Jaxie: (11:58) Yeah. I'd love to chime in and just share some additional thoughts. I mean, I couldn't agree more. I think, you know, even in businesses that maybe don't have greenhouse gas accounting directly centered within an accounting department, maybe kind of separated off to the side within a sustainability department, accountants are a critical piece of the puzzle. Like we are already, you know, with the diverse clients that we work with. Accountants are always an important part of the conversation when we start to think about measuring emissions from the entire value chain, right? When a company's emissions, tend to have the majority of impact actually coming from outside of the direct operations. And so we need to provide this gets a little bit technical, but you know, when we start to actually measure the emissions, it requires an implementation of kind of like diverse data points that are often reliant upon vendor spend figures.   Jaxie: (12:54) So the accountants are inherently directly connected to that. I also think when we think about kind of the shift in regulation becoming more apparent and influencing how companies are measuring their greenhouse gas emissions, accountants are the experts who knows better how to respond to the SEC than those business divisions. And so when we see regulations starting to become embedded within those kind of financial disclosure frameworks, it's absolutely critical that there be that expertise that's able to be brought into the conversation in terms of how we actually meet those regulations. And in relation to that, I think, you know, if we look at, for instance, the task force for climate related financial disclosure, it's a set of recommendations that helps to advise on how a company should strategically measure their climate risk and kind of communicate their risks and opportunities to stakeholders.   Jaxie: (13:59) And I think, you know, that TCFD framework often talks about how do we quantify in financial terms, the actual climate risks. And I think it's really important that we recognize that, you know businesses are evolving and how they define their bottom line, right? We're moving towards this triple bottom line of considering environmental and social factors, but the traditional society it's, you know, finances are what determines value. And so when we consider that fact, I think it's really important that climate impacts be able to be translated into those financial metrics. And I think it also, you know, not just in kind of early stages of a climate reporting journey, but even later stages coming up with, you know, internal carbon prices and thinking about how you can implement smart strategies that help your business, not just measure your impact, but also start moving towards the type of kind of low impact and positive oriented future that you're hoping to accomplish. And so I think accountants are absolutely critical from early stage companies, all the way to the companies that are really acting as pioneers in this sustainability space.   Arnaud: (15:13) I think we need management and concern to reveal the truth about sustainable products and sustainable services. Cause there is this bias that most people think that when something is good for the climate, it has to be more expensive. And very often it's because yes, it costs more money when you buy it. You know, it's an investment, but there is a payback for that investment. And I think we need management accountants because they play a key role in the capital allocation. And if they can help business leaders understand that what they should look at is the total cost of ownership. So if you think about retrofitting, your factory, of course it's going to cost consume money. But if you model like future price of carbon, if you model the price increase that we see for oil and gas and that we will see in the future as well, especially like if your business is international, the price of gas in Europe today is crazy, it's super expensive.   Arnaud: (16:01) And it's not just driven by the war in Ukraine, of course, that had a major impact. But already before that, we could see prices going because there were simply more regulation and more pressure to reduce greenhouse gas emission in Europe. And they have a very high price on carbon as well in Europe, which is going to, which is already in effect in some states in the US, such as California. So if you take all those factors into consideration, you come to realize that actually investing today, it's not a cost. It's really an opportunity that you should take. And we need management accountants just to reveal that truth to the top, to show that investing today in a more efficient fleet makes sense, investing today in redesigning your supply makes sense, investing in retrofitting your factory or buying, you know, more efficient boilers for your offices. That makes sense as well.  Kristine: (16:51) I'd like to add to that great response. And that is, there is a myth that it's more expensive if you try to become carbon neutral. And I think that the management accountants can create the business case to demonstrate otherwise and partner with others in the organizations to demonstrate that that myth is not correct. And that if you have the awareness in the organization and you're innovative, you can actually make more money and be more profitable. And that's a win-win for everyone.   Adam: (17:33) So that is a win-win. And I really feel like anything that really is worth it and means it, it does costs a little more upfront, but over time it's worth it. You know, things like DE&I, or accessibility and things in that route and things with decarbonization, I found the same things that you guys that you all are saying are the same things that folks who are passionate about those things are saying that, Hey, it may be something upfront, but it's gonna make us so much better in the long run. And I think that's what we're hearing. And as we've been talking about the importance of the management accountant, so let's say you're a management accountant, you've played out your case. You say, Hey guys, this is gonna go well, you need, you know, buy-in from your senior leadership to have some sort of company wide sustainability project to reduce the carbon footprint. What does it look like when you're trying to initiate that project? Can we maybe discuss that a little bit?   Jaxie: (18:23) You know, it really depends on the company. I also think it really depends on the governance structure and how open a company can be to new initiatives. But I think ultimately what you said is exactly spot on, you need senior leadership to be a driver of this work in order for there to be company buy-in throughout all of the different employee groups that are required to be involved in the initiative. So I do think it's really critical that senior people within the company are integrated into those conversations and in terms of kind of hitting things off. And how do you start an initiative like this? I think it's important first and foremost, whether it's internally or, you know, working with external parties like Agendi, which is where Arnaud and I come from, you know, to understand what this, the sustainability reporting landscape looks like and specifically focused on climate emissions.   Jaxie: (19:15) The greenhouse gas protocol is sort of, you know, the gold standard. It's sort of our Bible for lack of a better word in terms of how do we actually measure and report on emissions. And there's a variety of really wonderful frameworks that exist out there that really help to guide the process on what data do you need and how do you get from the data inputs to the data outputs? Because I think I mean, accountants who knows their way around a spreadsheet better than them? But at the same time, you know, you need to understand the full processes of what needs to be incorporated in because it's, you know, not your typical financial calculations, there's a lot of intricacies. So I think the first step is really kind of whether internally or working with external consultants to understand what information you need, what you already have and you know, how you can move forward from there.   Jaxie: (20:13) It's really, the first step is to measure your current impact prior to the deciding where you need to go. If a company gets too far ahead of themselves and sets a target without understanding their baseline, you know, how do you know if that target is achievable? How do you know if that target is ambitious enough? And so I think it's really critical that calculating things and calculating them correctly is the first part of the puzzle. You know, and with that, I think one area in which it's really different I think accounting has a very kind of more specific sets of rules that maybe I'm sure there's still constant evolutions, but I think there's much more of a culture in greenhouse gas, accounting of the spirit of constant improvement. We speak with our clients all the time about how it is an iterative process.   Jaxie: (21:05) And it's always better to measure your emissions to the best extent possible this year, and then improve upon that for the next year. So in some instances where you can't get the right data, it might be a matter of using some estimations based on what is available. And so I think familiarizing yourself, I guess, first and foremost, with how more broadly speaking one calculates greenhouse gas emissions. And then, secondly, just not being too afraid of being imperfect the first time. You obviously want accurate numbers, but at the same time, you know, it's a complicated process. And so it's really important that you not avoid the initiative entirely out of fear that, you know, your numbers like will not be the ultimate goal of where you would be in three years. Yeah. Arnaud, I'm curious if you have any additional thoughts on that.   Arnaud: (21:58) Yeah. I think to me first, you need to be inclusive. So you need as an concern, you need to go outside your own department. You need to involve the different functions, you need to discuss with your suppliers. You also need to discuss with your customers as some of the impact will also come from the customer side. You probably need to involve HR because, you know, your carbon footprint is also the result of the activities of your employees. So that's very broad process. I would say your goal should be that what you call a project does not be basically becomes integrated in the entire business. So I don't see like sustainability as a separate project it's really part of running a business efficiently. So you need to make sure that the risk function, for instance, one thing we try to do is working with the risk function and making sure that climate risk are being analyzed by the risk function.   Arnaud: (22:55) You need to, when you discuss, let's say employee travel, you should be discussing with people who are booking for employee travel to make sure that every time they book for employee travel, they think about the consequences in terms of carbon. So I feel it's a lot of sharing knowledge, you know, all the things that you learn on this project, you should share it with all the departments. So that basically the entire organization, brief carbon accounting, brief carbon reduction, because that's the only way you would be able to integrate all those best practices within your business and deliver results in the end.   Kristine: (23:28) I agree with what Jaxie and Arnaud said, but I think that it's extremely important to do something. Start the process, start the thinking. Definitely you need the support of the top management, but one of the lessons that I teach my students, because I've integrated sustainability accounting in my management accounting class is the power of one. And with that awareness, you can help turn the organization around to understand how critical and important this is. It needs to be a culture where everyone participates and understands what's at stake. There's a forklift driver at Interface corporation, and he knows that his job every day is to save the planet and to work efficiently so that he doesn't use more CO2 gas than he needs to use. It don't have to start with sophisticated systems. Spreadsheets can do the basic accounting and then think through it can be complex as Jaxie said. There's no question about it. And it needs to be defined in an architecture and a plan, and you don't have to do everything tomorrow. You can scaffold it and build it into more complexity until finally you're creating an ESG or a sustainability report that you can publish and share with your shareholders to demonstrate your commitment to this urgent problem that we are facing globally and show the continuous improvement and you're creating value for the organization.   Jaxie: (25:20) I think just one more quick thing to say off of that, Kristine, you know, I think there were some great points you addressed and, you know, in speaking to that power of one I think one of the first things is creating an opportunity for someone to take ownership of this work. It is complex, as Arnaud said, it, it requires numerous business divisions. It requires consideration of external stakeholders and identifying a specific person who has this either as their entire you know, role or as a major component of their role is a critical step forward. So identifying who's gonna be doing the work or at least kickstarting it because, you know, in order for there to be that power of one, there needs to be someone to be powerful. So I think that is important too.   Outro: (26:11) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Connect with Gordon: www.intrepidbrotherhood.comFull Episode Transcript: Adam: (00:06) I'm Adam Larson and welcome to Count Me In, the podcast that explores the world of business from the management accountant's perspective. Today, we are talking to author Gordon Graham about his memoir, the Intrepid Brotherhood: Public Power, Corruption, and Whistleblowing in the Pacific Northwest. This is a really fascinating story. Gordon was a senior technology leader at the public utility who uncovered blatant persistent corruption among executive management at the company. But while others accepted the corruption as an unfortunate fact of life, Gordon fought hard for change, even in the face of fierce retaliation from the executive wing. His decision to fight and ultimately become a whistleblower, provides a riveting example of the lengths people will go to on both sides of an ethical dilemma. Here's my conversation with Gordon Graham.  Adam: (01:01) So Gordon, thank you so much for coming on the podcast today. I really appreciate you coming on and let me just start by saying, you have just an amazing story that you wrote about in your book, and I hope we'll get to hear a little bit about it today, but one of the biggest items that you talk about is standing up for what is right. And now this can be especially hard when you feel like the weight of an organization or a local government on you and you probably feel very alone. Can you give us your take on standing up for ethical professional treatment at the expense of one's career?  Gordon: (01:32) Difficult choice, to say the least. I think one of the reasons I wrote the book was just so people who may be experiencing the same thing or recognize, and same characteristics in their organization can have something to refer to help them try to determine how they can help their organization, maybe get out of that circumstance, how they can help themselves, maybe the people within the span of control that they have, or have responsibility for. They can help them deal with it. It's a very personal choice to decide to actually confront those issues. If you recognize 'em in your organization. And a lot of people are going to choose differently than I did. My circumstances sort of dictated that I needed to personally dedicate myself to trying to help the organization that I had invested so many years in.  Gordon: (02:33) I really feel like I didn't have any choice. There was no other decision for me to make. And unfortunately even though I exercised what I think were the right steps, the right maneuvers to try to get people's attention, to build recognition of the problem, I failed at that. I have to admit that I didn't get that done. And in the end it caused me to have to change my employer, my career path a little bit, I had to relocate, a whole bunch of things happened, but that's, you know, I really can't advise anyone on specific approach or steps to take to you know, ultimately deal with that situation if they recognize it in their organization. But hope hopefully the book provides some tools to evaluate how to make that decision.  Adam: (03:29) Definitely. I mean, that must have been a very tough decision to make, especially job location and friends I'm sure. And like community, you had to kind of disrupt everything just to make that decision that you made.  Gordon: (03:43) That's correct. Yeah. There was a lot of circumstances and factors that weighed into our decision. I say our, because my wife played a huge part in that analysis to say the least. So yeah it really was life changing and, you know, I would've rather that it would've resolved differently, but that's just the way things evolved. And we made the choice that we did because we felt it was the right one.  Adam: (04:17) Yeah. So let's say I'm in a similar position and I'm starting to see signs of abusive leadership somehow in a management position at the company I'm at, you know, what steps should I take? Like what are the steps that someone should take when they start to see those things?  Gordon: (04:35) So if you recognize some of the things that I've outlined or specified in the book are happening in your organization coincidentally, I just, I just did at the request of my self-publishing company, I just did kind of a deep dive into that very subject and came up with a piece that will be shared with people that joined my email list and that type of thing. And there are certain things that I think constitute the right way to approach trying to resolve that in your organization. The first one I believe, and probably the most effective, if it is successful is to approach the individual or individuals that you think may be in control of the situation. So if it is your CEO, if it is your general manager that is truly turning the company upside down, or at least in your perception is doing that.  Gordon: (05:33) I think that's the first place to go. What better place to resolve it than right at the source, if you can gain some recognition and at least get the conversation started about, you know, why maybe you are misperceiving things. Although in most situations, if you recognize the things that were happening in my story, I don't think you're misperceiving anything, but at least to try to raise awareness with that individual or those individuals and get them to think about what may be the long term consequences, if it can be resolved at that level. I think that's probably the best solution. Failing that, or at least not achieving the level of success you might have liked. I think the next resource might be peers in your organization. So if you are at a mid or senior management level, there are other people that are in your group, so to speak, that you must interface with on a regular basis.  Gordon: (06:37) And if you can gain some recognition amongst that group, then you can sort of initiate an intervention, so to speak. So you've got a group of people who are of a like mind that can approach upper management or the senior management and let them know what you are observing collectively and what you think would be a better path to pursue. If you can't build that coalition, then the next place would probably be to try to get the attention of one or more of the elected board members, appointed or elected, however your board is constructed. There's really nobody else in the organization that should care more about oversight and really nobody that has more responsibility for that function. So if you can get the attention of at least one of those individuals, then I think they can actually spread the word amongst the rest of the board members and try to intervene and maybe right the ship so to speak.  Gordon: (07:58) So that's probably the next best place and then failing all of those things. You're kind of in my situation or the situation I was in. And really the only alternative I had at that point was to take my case to the public. And, you know, that ultimately ended up in blowing the whistle and having to file a petition to protect my employment, which ultimately failed. But that's the last resort. And I certainly can't advise anyone to take that step. The other alternative or the last alternative, I guess, to that step would be to just check out mentally or physically, you may just resign yourself to the fact, you're not gonna be able to change anything, move on to a different position, if you can find one. And there's a lot of advice out there in the community to do just exactly that, if you can't thrive at your job, if you are being harassed, if you're being subject to something like constructive discharge, like we discussed in the book, then maybe you do just wanna leave.  Gordon: (09:16) My choice was not to do that to try to seek resolution through another method and well, the story is what it is.  Adam: (09:24) Yeah, yeah. I can imagine how lonely that must have felt not being able to build a coalition within your organization to say, Hey guys, let's right the ship and having to go outside to do the actual whistle blowing because no one, like you couldn't build that within because that can be very lonely at times.  Gordon: (09:45) It was. Fortunately I had some people on my staff who are very professional, you know, highly educated, intelligent people and knew what positive leadership really was. And so it wasn't hard. Well, they were actually the ones that initially started observing some of the failings of the current leadership model and, you know, because they filtered down to our level and affected our staff and our resources and just the whole approach to what we were trying to do. So yeah, we had that coalition, but it, it didn't spread far enough.  Adam: (10:29) Well for what I hear you were saying, it needs to expand outside your department to many different areas. So, you know, we've talked a lot about the person who is observing those things. Maybe we can circle to, you know, what, if I'm a leader and I'm like, you know what, I wanna avoid abusive leadership. I wanna avoid this constructive discharge. And I wanna run my team, my business, my organization. I wanna run them with an integrity. Are there some tips or some guides that you can give us as we, as we've been talking through this to avoid get going down that road?  Gordon: (10:59) You know, one of the things in retrospect that we've discussed a lot is the fact, and I believe it's a fact that a lot of people, perhaps most people who are elevated to positions of leadership, ultimate leadership in an organization, it just simply doesn't come naturally to a lot of people. You have to be intentional about how you are going to lead people. It's not a seat of the pants type of thing. And even I had to come to that realization to the level that I got to in my career I needed to discipline myself to stay on top of what was best for my staff in order to achieve what we wanted to as a department and an organization. And that's my first bit of advice for people who want to aspire to, I guess, to achieve ultimate leadership positions is be intentional about building your leadership skills and maintaining your leadership skills.  Gordon: (12:11) And then there are a number of very, very good models out there these days, servant leadership, inspirational leadership. The one that I talk about in my book, which is somewhat dated, but I don't think really ever loses its relevance is the learning organization from Peter Sinji and those components or disciplines of shared visioning and team learning and probably the big one personal mastery. So you know who you are and you can discipline yourself to implement these things that will be better or make your organization better, and then make the investment in, and the people that you are responsible for, as a servant leader, to make sure that you are doing everything to advance their careers, because it just it pays back in the long run.  Adam: (13:12) One thing I heard you mention, and I even said it cuz I've just read some of the stuff you've been talking about is constructive discharge. And I realize our audience may not understand what that is. And so maybe we can define that. And how can you determine if you've fallen victim to this practice and what should you do about it  Gordon: (13:28) It's referred to in a number of ways constructive discharge, constructive discipline, constructive dismissal. But really what it is, is circumstances created by your employer to make it impossible for you to stay. So in other words, in lieu of them trying to create or document circumstances or reasons to terminate you, what they try to do is, is do things that make it apparent that they don't want you to be there any longer. And really what it amounts to is, workplace harassment. And it's probably probably illegal in most cases subject to the ultimate test, I suppose, but that's what it means is creating those circumstances where you want to make it impossible for an employee to stay so that they make the decision voluntarily to leave. And it's amazing the number of people that I've heard from since, well during the time that we were developing the book and just as I have related my story to people and afterward after it was released about how many have gone through circumstances and recognize what I related in the book as something that they have lived through.  Adam: (14:59) So is it something illegal? Is it something that companies are not allowed to do or is it kind of like under the law, that thin gray line that you can kind of do it cuz what you described made me think of, you know, COVID policies where you have to get the vaccine or you can no longer perform your duties, I.E., you're gonna be fired, but they don't say that you're gonna be fired. They say you can no longer perform your duties. So something along those lines, is that constructive discharge, is that an example or is that outside the realms of this?  Gordon: (15:27) So I don't think it's cut and dry in every case. I think generally the legal profession regards the term and those circumstances as illegal because they use that as justification for a claim or lawsuit or seeking remedy. So if it is indeed a circumstance where your employer has created conditions where your persecution is unwarranted and it's obvious that they were trying to get you to leave, then, then yeah, I think it is illegal, but it's always subject to the test. And in my situation, fortunately, we didn't have to include that in our claim and in the court proceedings. There were other things that bubbled up to a higher level that we based our claim on. But I felt it was probably necessary to use that term and to describe the circumstances in my story. So that employees, people who are maybe experiencing the same thing can recognize, you know, what's going on and maybe how to address it.  Adam: (16:45) Yeah. Cause I can imagine it would be difficult to prove, especially if that's your only claim.  Gordon: (16:51) Yeah. I think if we had, especially in my case, if we had pursued that if you look at the things that we had in our documentation to try to make that case, my employee reviews 360 reviews, just pure feedback. It would have been difficult for them to defend having done that. The things that they did to try to get me to leave. But like I say, fortunately, we didn't have to do that. It's yeah. It's I don't think it's a good situation to air your dirty laundry or let somebody else air it and then and try to ring it out in the wind and get things sorted out.  Adam: (17:38) I can imagine. So as we kind of wrap up our conversation, this has been a wonderful conversation. Something that you've said a lot. And I've seen you say a lot in some of your articles and your website is that during your search for better management of ethics led you to Aristotle. So as we wrap up our conversation, kind of wrap up everything we talk about, what can we learn from ancient Greece to be better management and ethics.  Gordon: (18:05) The Aristotle thread or hook throughout my book and, and the whole process when I was an MBA student, people like Peter Drucker and Chris Argyris and even Ken Blanchard were writing about management and leadership that evolved from Greek philosophers and especially Aristotle. Change management, leadership, service management, everything seemed to have a hook in the virtue ethics that were promoted by Greek philosophers, things like wisdom and temperance and bravery and leniency and justice and all those things were translated into more contemporary management and leadership philosophies. So I remembered that I wrote research papers that were based on things that evolved from the Greek philosophers and just tried to convey how modern management and leadership techniques were anchored in those philosophies. And I think that still exists today.  Gordon: (19:27) If you look at the new leadership philosophies, you can find things that actually relate to the Greek philosophers and what they initially or originally espouse. And I think one of the reasons is even though everybody looks at it and refers to it as Aristotle's virtue ethics, the Latin term that they use, that we translate into virtue is probably more correctly translated as excellence. And so if you look at it that way, what they were actually saying was if you follow the behaviors that they promoted, then you can reach the proper state or condition for a human, performing well in the function of being a human being. And I mean, that really anchors every leadership philosophy that you might want to embrace and promote going forward. So that's the whole I guess, Aristotle hook, the reason that he appears so prominently in the book, well, there's a couple of them.  Gordon: (20:38) That's the first one, because those Greek philosophers did, I think provide the basis, the launching pad for pretty much everything that we should be promoting in leadership today. And the second one is in the latter part of the book where there was an individual that actually emerged after the original trial verdict who defended the organization, the utility that I worked for against the jury decision. And he was kind of standing out there on his own alone as a defendant against the rest of the community who supported our initiative to try to get a management change and a different perspective for the organization. And he called himself Aristotle. He used that non deplume or pseudonym. And I thought that that was significant because, you know, everything that we had tried to do from a service management leadership perspective was actually anchored in Aristotle's virtue ethics. And here, this fellow was actually defending the more belligerent and destructive leadership of the utility, but he called himself Aristotle. So I thought I'd better get that in the book as kind of a contradiction. So that's the whole Aristotle story. That's why you see him so much in this story. And I just couldn't leave that out when I wrote this book.  Outro: (22:18) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Connect with Bruno: https://www.pesec.no/ Full Episode Transcript:Adam (00:05):Welcome back to Count Me In, the podcast that explores the world of business from the management accounting perspective. I'm Adam Larson, and our guest today is Bruno Pešec. As you've probably noticed, we talk quite a bit about innovation here at Count Me In. After all, it's the mechanism for how companies create new products and services to drive profitable growth. Bruno is an engineer by training and an expert in helping companies think systematically about where continuous improvement ends and how robust innovation begins. His insight about how management accountants fit into the picture can often upend conventional wisdom, which makes this a discussion you do not want to miss. Let's get started.Adam (00:53):Bruno, thank you so much for coming on the podcast today. Really appreciate having you on as we discuss innovation within the corporate sector. And one thing I wanted to kind of start with is, you know, we've gone through almost two, three years of a global pandemic and organizations are really struggling to keep afloat, whether keep afloat, figuring how to use hybrid work from home, not work from home. Where does innovation sit in the midst of all this, as we're trying to restructure what the world looks like as we go forward?Bruno (01:22):So Adam first happy to be here. And second, great opening question. If I might add what I really well, I want to say what I really love about the last three years, but that's a wrong choice of words. So I will rather say what has became obvious in the last three years are good and bad habits in handling disruption and not just innovation, those companies and business leaders that were innovative before all these big changes happened, fared better, not because they had the best ideas or they had the coolest products, but because the process of innovation is the process of handling uncertainty. So they developed a skillset and capabilities that allowed them to handle this uncertainty. And innovation is one of those words. You know, you ask 10 people what it means you're gonna get 20 definitions. So I'm not here to tell you or your audience, what is the definition of innovation, but I want to share what is my take on innovation?Bruno (02:24):So whomever is listening that they know what am, what am I actually thinking when I use those words. So in the broadest terms, I consider innovation to be something new that creates value. Something new, not to the history of mankind, but new to your customers and to your organization. That's enough to qualify as new and value must be two by directional. So it needs to create value for the customers. Something that we have gradually gotten better at, but it also must create value for the organization. What sense does it make to create new product services and business models? If they drive you out of business? And this is where our accounting friends are very, very useful, sometimes maybe underappreciated, but back to your question. So the companies that were already innovative before they coped much, much easier in this disruptive periods, why? Because they were able to actually go back to their customers and learn how did their reality change, how people were buying and using your product could have changed overnight, just look at hospitality industry.Bruno (03:34):So everything dramatically changed. Incumbents, like big hotel chains or even smaller motel chains. They were just adjusting to what happened with Airbnb, booking, hotels.com and all these disruptors and bomb. Then COVID came and suddenly the whole industry was flipped upside down. And those that actually managed to stay afloat, they used a lot of different tactics, basically repurposing the whole venues for something else. So that, that was a good example of how did they handle disruption? What I've especially seen the companies that didn't handle it well, did all the same things. One, they tried to weather the storm. They said, okay, this is going to blow away in three months, six months, nine months, two years, three years, who knows how long, but they basically said we have our fat, we have our supplies. We have our business, let's just try to weather the storm.Bruno (04:32):Basically put our hand heads into the sand. That did not work. The only thing that we have seen is that all our projections were pretty much wrong. What we expected to be weeks than months turned into, well, we are in the third year, but we have a war that kind of is even more disruptive. So people are looking more to that. Another thing is besides trying to weather the storm was ignoring the changes in reality. So kind of just assuming that the strategy you had before the business model you had before the product portfolio you had before that it's still valid and kind of trying to keep optimizing that, you know, sending people home, working from home, hoping that will be lower operational expenses, but still keep the same revenue that did not work out so well.Bruno (05:24):And the third one was a failing to adjust the leadership mode. So what was really and remains very important in this period are leaders that are also able to provide this emotional and psychological safety. So kind of the leader doesn't need to have all the answers that's sometimes not even desirable, but the leader should always be able to say, I'm here for you. We gonna figure it out together. And those that were not able to kind of maintain that, that were not able to direct their crew in the right direction. No, the people suffered a lot emotionally, then that spills over into family spills over then back to the company on the performance. So these are kind of the things that I will highlight just at the top of the pile.Adam (06:12):For sure. Yeah. There's a lot, that's at the top of the pile and I'm sure more trickles down as we get into the conversation. So you start with what you kind of talked about, you know, where you kind of have to adapt leaders have to adapt. People have to adapt. The company needs to adapt companies that were innovating before have to continue innovating. They're probably a better set. So what about, you know, when you look at innovation like some, and you said something new that creates value is your definition of innovation, which I think is a great definition, but those outcomes, they can't be guaranteed. So how do you measure it? How do you measure that within an organization, especially when you have all these new factors, there's a lot of new things, a lot of new things that could create value are happening right now. So how do you measure all of those elements?Bruno (06:58):Yeah. Yeah. So Adam, I mean, I could probably be talking about this question for days, but we don't have days. So I'm going to focus on a couple of things. You nail the problem straight on the head. So what is specific for innovation is that no one can guarantee outcomes. Like it doesn't matter if you do everything by the book, if you follow the best innovation processes, you can still end up with a product service or even the whole failed project that there was no return on investment. But what we do have in control is the expense side, the organization side, the work side, what ideas do we select? What ideas do we prioritize over others? How do we fund these ideas? How do we control these ideas? What people do we put on them, et cetera, et cetera, et cetera.Bruno (07:54):So I gonna focus on three specific practices and this come out of my experience, working in different industries, both large and SMEs. And I gonna focus specifically on the work I did with CFOs and the financial functions in larger organization. So unfortunately I say, unfortunately, internal accounting, business controlling and CFO are often seen as kind of gatekeeper to innovation, but people don't understand or they misunderstand their role. Their role is to protect the assets of the organization. Of course, they will say no to your silly idea. You you're just coming to them with something that's unproven, no evidence, nothing. And you're asking them to unlock the coffer in this difficult times and invest in something that's completely uncertain. Of course, then they will react by saying no in most cases. What's better for both sides and I gonna start from the financial side is that there is a specific system.Bruno (08:57):They can set up to protect the organization without stifling the innovation. First thing, think about any innovation project innovative idea, anything in your organization. Think about it as an option. Don't think about it as a big bang investment, but you are buying an option in this innovation project. Combine that with funding in trunches, what it means is there must be an innovation budget, whatever let's say for the sake of conversation, let's say it's a hundred million, but that does not mean that you assign a hundred million to a single idea, but rather that you drip feed it. You drip feed from that big budget, a lot of small ideas numbers tell us that we need to invest into a hundred, to 150 ideas to get that golden idea that will return significant investments, return on investments, significant meaning 10X, not just recovering the cost of the investment to get more practical or more specific.Bruno (10:02):So one organization, they set up their innovation strategy. They prepared innovation budget, and then they set out call for ideas. And there were hundreds of ideas. What they were funding was they did not release big money to go and develop a prototype. That's even too big. What they were funding is two weeks for employees to explore the idea further. That's the level of granularity we are talking about. So CFO doesn't need to be on those teams. That would be waste of their time. Not even accountants are needed on those teams, accountants, business controllers, etcetera. They should be invited once the investment breaches specific threshold. But in the beginning, what we want to do is a lot of small, small, small investments, just to check if these ideas are worth of anyone's time. That is, that is how CFO can set up a system that actually doesn't prohibit or retard innovation while still protecting the assets.Bruno (11:06):Combining that with options theory, and options thinking what they have at all the time is option to basically stop the project before it gets too big. I would rather spend 10,000 euros to determine 10 ideas should not be invested in than spend 10 million euros in one idea that doesn't work out after five years. And, you know, once you stop thinking just about the money, but the whole opportunity cost, I mean, wasting two weeks of your five employees is much better than wasting five years of hundred employees. Just putting money aside. I mean, the talents I it's painful and people will probably leave your company. If after five years, their project has been stopped or it has failed or something else. So we have from the CFO office to the middle management, basically define the budget, release it in trunches, think about options. And then something you mentioned at the beginning of our conversation monitor specific measures.Bruno (12:10):And this is where it gets really difficult. It doesn't matter if it's an SME or a large corporate, we still haven't completely cracked the code of what are good innovation measures. And there isn't a silver bullet. Unfortunately I'm not bringing that silver bullet, but what has been working so far as a really good solution is taking a systems approach to measuring innovation. What I mean by that is CFO and top management. They should measure the performance of their innovation portfolio. So looking at portfolio metrics, that's looking at basically an aggregated measures showing, okay, out of all the investments in innovative ideas, we have made what's the average time of return. What's the profit margin compared to other products. In my opinion, innovative projects should have above average profit margins. Otherwise you could just do continuous improvement. That doesn't make sense. So if you are making a risk investment, there should be a significant return.Bruno (13:17):So that's what we're talking at top measures, moving into the middle layer, let's call middle management. If you want. This is where especially controllers and company accountants get useful. It is measuring basically what we call innovation funnel. So in your company, there might be different maturity levels. You might have product live cycle or something of a kind where you basically say, you know, step number one is exploring the idea. Step number two is validating the idea. Step number three is taking it to market step number four, scaling. So kind of every company I worked with, they do have some sort of a model like that. So measuring that funnel then becomes important for one simple reason what we said in the beginning, there is no guarantee of outcome, but the quality of work, the quality of innovation process and how costly it is, that's something you can control.Bruno (14:12):And that is what accounting is golden for. It's the mindset here that becomes difficult because you business controllers have unfortunate title like this controlling. It sounds like they're there to be police officers to punish if you're out of boundaries, but that's not really their role. Their role is to help the innovation teams or any other team to control the expense, not to control the people. Together, they try to figure out ways to reduce the cost while keeping the operations flowing measures in this level are things like how many ideas have we invested in? How long does it take to get idea from stage A to stage B, how many hours does it take or raw goods, whatever additional services, et cetera. You're not trying to go into too fine details, but you need this granularity of different type of activities, because that feeds both into the top level and the bottom level of innovation matrices, because this in between, you are really looking at two things, how much does it cost us to develop an innovative idea?Bruno (15:22):And how long does it take us to develop that idea? That's the middle level? What's it all about? If you can master measuring these two then later on when returns come, because for in really innovative idea, returns are five plus years. You, you're not really looking some, getting something back in two years, but if you spend this five years to actually get the really, really good overview and control of, you know, cost of innovating and speed of innovating, oof, you are already ahead of the pack and now trickling down all the way to actual innovation teams. This is where metrics really explode. And unfortunately, people don't like hearing that, but I must say it because it's reality, every innovative team has to have their own set of metrics. It's their responsibility to actually identify those metrics, but it is CFO and the top management that has to approve them.Bruno (16:24):And I'll give you a few practical examples. Let's say that you are in financial services, kind of you're providing all the financial services in your country. And let's say that you set up three teams. That's quite not enough, but just, just for the sake of conversation. So let's say that you have a team that is trying to come up with a new consumer loan. You have another team that's trying to come up with a specific security product for business customers, and you have a third team that's trying to come up with a specific product for very, very wealthy citizens. Those three have nothing in common. How could we possibly have the same measures of success for each of these three teams? That's why I say, when you actually come to the specific teams, they need to identify what are the relevant measures of success for their specific idea.Bruno (17:21):I'm here not talking about MVPs, discounted cash flows, return on investments, return on equity. Those are all premature. You cannot use that set of metrics to evaluate any of these ideas. What the team needs to come up with in terms of generic language is they need to come up with what is specific signal that the customer is interested in this, and what is the best proxy we can measure for market size and market response. And yes, this is the most generic we can make it, but that will differentiate between district teams. So for consumer loans, they might say, okay, we are actually in B2C market. Therefore we are actually looking at quite significant market share. Therefore, we are looking at a turnaround of an average citizen that's interested in getting a consumer loan. What type of specific consumer loan, what type of behaviors lead to loan?Bruno (18:20):What are the characteristics of citizens that may get a loan and still paid back on time? They would look at completely different set from the team that's trying to innovate a new security product for a corporate customer. They would then go need to look okay. We're now talking about a corporate product. We are in B2B. We need to understand how are decisions made. Do we need to reach out to CFOs of businesses? Do we need to reach out for different roles? What do they react to completely different set of innovation metrics and the same would go for the third team? The good news I have for you is what I said just few minutes ago. That's the job of actually innovation team. Don't, don't try to use your business, controller's accountants or somebody else to go and tell the team. This is what you should measure. Put the ball in their court. Ask them, Hey, what is the signal that this is worth doing? Go and measure it, and then bring me back the measure. You know, you make it so much easier for you at the same time. You are empowering people and developing their skill as innovator, which is important for your long term success as an organization.Adam (19:34):So kind of, as you're talking through that, I like circling back to the accountant and the accounting team when it comes to innovation, it seems like what you've been saying is that the controller shouldn't be the controller, as you said, but they almost need to come in as what we've been saying a lot in the industry is the business partner that the controller of the CFO needs to be the business partner with, you know, with the rest of the C team. But also if there's an innovation team that's happening, some subset of the accounting team needs to be a part of some of those meetings to be that business partner, to be the, the reality check at times, and also to sit there and say, oh, let's see what we can do. Am I, am I hearing you right when you're saying that?Bruno (20:18):Absolutely. I have few things that I would suggest based on my experience. This is mostly your European businesses, but I think, practices are similar across the Western business area, your comparison to having a controller or accountant as a sort of a business partner is a good one. What I've noticed, some of the habits that they shouldn't use with innovation teams that are good with mature teams. First forget spreadsheets. Don't try to build a business case. This isn't a mature project that you are trying to build the business case that you need to use sophisticated spreadsheet. There is too much uncertainty. The only thing I can say you for certainty is that any hour you spend on that is going to be a wasted one. That doesn't mean that your spreadsheets are bad. It just means that now is not the right time.Bruno (21:14):If you are meeting with a team to help them in their first three months of an innovation project, forget about using spreadsheets like that. What they need is just your help in understanding how to do quick market sizing, quick and dirty, not specific conversion rates. They might need your help in terms of understanding, because people forget that regular employees in a lack of better word, regular don't really have complete financial picture of the organization. They understand their part of the organization, but not necessarily how the whole organization actually makes money or spends money. This is again where you are very helpful where business controller is an accountant. Basically forget that they have much, much bigger picture of the organization's business. This is very, very useful information for any innovator. Why? Because it helps them basically tweak the idea. So it's even more useful for the organization.Bruno (22:14):So a business controller can be a business partner in a lot of stuff that isn't, let's say hard numbers, or immediately going to financial modeling, financial modeling should come much, much later. Second thing I would suggest any business controller or accountant helping an innovation team is forget about spot estimates. If you're helping a team, do estimates, make sure use range estimates. So if the team is asking, you know, what kind of pricing should we have or kinda what's what's the break even point or something similar first it's okay to say it's too early to discuss that. And second, if it's not start looking at ranges, don't say five, say from three to 10, and that is 70% probability for that range. That's much, much better. You're very unlikely to miss by a magnitude of a hundred or a thousand. You might miss by a magnitude of 10.Bruno (23:12):But again, because of all the practices I told you before, release funding in trunches, think about this option. You will never over invest. It's very difficult to over invest in such a system. So that kind of protects you. But this range estimation is a skill that is very, very important and controllers I worked with. They all know that they just need to be reminded. So kind of the skill set is there, but because their daily job is working with daily operations and making sure daily operations are efficient, sometimes they forget their own part of the skillset. That's more useful for more uncertain ideas and projects. Again, if it's an innovation project, you can assume it's uncertain. Otherwise it wouldn't be an innovation project. And the third thing for business controllers as business partners, where they're really useful is actually connecting people within the organization.Bruno (24:11):Again, someone who is, let's say working in a, we have a example of consumer loan. So an employee that's working in consumer banking will probably not know all the connections inside the organization for the support roles, support functions, accountant or business controller is actually quite likely to work across the whole business unit and maybe even broader business. So this is where they can really go from gatekeeper to kind of networker to the connector. And again, this might sound so mundane, but this is so valuable because when we think, when we talk about ideas, people like talking about, I think, outside of the box, that's all nonsense. The best ideas come from connecting the dots. And if you, as a business controller can help the teams that are coming to you for help to connect the dots. You increase their likelihood of success and therefore increase the likelihood of your company's success.Bruno (25:11):And not only that, but then the social thing starts happening. People start reaching out more to you instead of being afraid like, oh man, now we have to go to call the Tony the business controller because we need his approval to go with this. You move from that to, Hey, let's have a quick chat with Tony. He has some really good, you know, perspectives, and he always knows who we need to talk with. So kind of then you really start fulfilling that business support role. And you know, these three things I just shared with you, they're all from practice. I've seen them all applied with great success and they don't take anything. All the know how you already have now is the difficult thing of actually doing that.Outro (25:56):This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard. And you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Connect with John: https://www.linkedin.com/in/john-greene-/Full Episode Transcript:Adam: (00:05) Welcome back to Count Me In, the podcast that looks at business issues and trends from the management accountant's perspective. Today, we are speaking with John Greene, the CFO of Discover Financial Services, the company behind the Discover credit card and the television ads with the catchy tagline, "We Treat You Like You'd Treat You". I'm sure you've heard the term financial transformation before, which is basically the process of bringing digital tools and technology to the finance team inside organizations. Today, we are gonna look at how that process actually works at Discover and why it's critical to strike the right balance between driving innovation and making sure team members feel empowered along the way. Let's get started.   Adam: (00:51) So, John, I just really want to thank you for coming on the podcast today. It's, really a pleasure to have you on and today our focus is gonna be around finance and innovation and how those two connect together. And so as we start off, I just want to ask what are your guiding principles when it comes to finance and innovation and how they connect.  John: (01:08) Great. Adam, great to be here. So, you know, my guiding principles are first, we want to make sure we have the right people and the right sort of jobs. So by that, I mean, people with the right skillset, the right values, high level of integrity that are working towards a common mission, which would be to going to benefit our customers and the organization and the financial outcomes that we're seeking. So that's really, really important. And being able to connect the organization mission to individual objective's really, really important, both from an innovation standpoint, as well as from a team building standpoint. And then the second guiding principle would be to ensure we have the right organization design and the right structure to make people successful. So that includes having the right level of technology, the right commission, the right focus on innovation in order to have people feel like they're empowered to be able to make the changes that we're seeking to drive within the organization.  Adam: (02:19) But then when you look at innovation from an organizational perspective, is there like a definition of what counts as innovation? And then what does that look like for each employee?  John: (02:29) Yeah, so for me, innovation is a really, really broad concept. It can be as simple as changing the way we do do something on a day to day basis, which would be innovative, or it can be leveraging technology in entirely different way or leveraging new technology to drive innovation. So, you know, a couple examples of kind of changing the way we've done things here at Discover, without the benefit of technology would be, you know, our journal entry process. So we were doing almost two, 2000 journal entries a month. Every time we closed the books and through some process redesign some change of policies, as well as taking a different look at how we focused on certain accounts, we reduced the number of journal entries we did on a monthly basis by about 40%.  John: (03:33) So, think about it. That is, that is 400 entries that, you know, someone doesn't have to kind of put together, get the backup file, and then review. So, you know, without technology, a high degree of innovation there in terms of process redesign, we did the same. We did the same sort of thing with our FPNA, processes. So think budgeting and forecasting. We, took a look at what was important for the organization, how timely we needed updates on, where the company was going financially. And we eliminated, one third of the forecast we were doing. So what went down from six to four, what it did is it freed up capacity to spend time on analytics. Now, there are two examples that involved process redesign, not necessarily technology.  Adam: (04:34) Now we've deployed RPA, so we call them bots here in Discover and, you know, that has also enabled us to further reduce journal entries. It has also taken manual work out of a number of different areas within the finance organization. So, that that's been a win. And on top of it, we switched out from an old McCormick and Dodge, general ledger system, and just implemented, Oracle cloud, here. We put it in about, a year and a half. It went in, frankly, in a really, really smooth way on time under budget, but what that's enabled us to do is take out nearly half the cost centers we have here. So, the combination of kind of process redesign and leveraging technology and new technology we've really changed the way we work. And we freed up significant amount of time to analyze the business rather than tell the business or report on what has happened in the business.  Adam: (05:46) So as you've freed up that time to analyze, have you seen, have you already been seeing the benefits from even team morale being able to change their job description of, Hey, I'm going to stop these 400 extra journal entries to analyzing something else, has that improved even just employees as they get to do new things?  John: (06:09) Yes. Actually, so, you know, change can be, you know, harder on some people than others. And so what, what we've tried to do here is focus on a culture of, of creating positive change that will improve analytics and efficiency without the risk of job loss. So in the situation we're in right now, we have a level of normalized turnover, just like every organization does. And we've been able to absorb that turnover redesign, you know, people's kind of responsibilities or organizations without impacting kind of employment in a negative way by that. I mean, you know, we haven't had wholesale layoffs or reductions. What we've done is enrich people's jobs by taking out what I'll say is more transactional or non-value work. And, you know, that's translated into some positive results on our engagement surveys. And I feel like it's really been beneficial in terms of motivating some folks as we've been able to expand job responsibilities.  Adam: (07:23) That's amazing to hear that that's the initiative you've taken. I know that I'm sure the employees appreciate it, but it's also an innovative way of, looking at the human capital and investing in them as opposed to just slashing them and saying, well, we need to get rid of them.  John: (07:39) Yeah. And you know, lot of credit for that is to the organization, in the entirety. So Discover spent, you know, decades trying to create the right balance of financial performance and culture. And, you know, the folks that come here, I think have enjoyed that aspect of the culture in terms of trying to create an atmosphere that, you know, operates with as little bias as possible, that values innovation, that if values change, but also respects kind of human capital and tries to create the best experience for our teams.  Adam: (08:22) So you've been talking about the great improvements and innovations that have happened through technology and other ways that, you know, have helped the journal ledgers and using RPAs and bots. But what changes have you noticed in your responsibilities, and expectations, especially during these last two years with COVID?  John: (08:41) Yeah, so great question. So, you know, the core responsibilities haven't changed really. But what has changed as is the, focus points, right? So when the pandemic hit, you know, our responsibility collectively here as leaders was to first ensure people were safe. The second was to make sure that we created a remote work environment that allowed us to get our core responsibilities done, and then it, certainly evolved to, okay, can we close the books? Can we execute on our public disclosures and earnings calls? And, while doing that, also making sure we have plenty of capital liquidity and our credit. So we're a lender. So, you know, when we lend money, we want to make sure, we collect it or are within our risk tolerances. So we spent a lot of time focusing on that.  John: (09:44) And our finance organization was instrumental in terms of the value helping the business evaluate kind of the trajectory of the credit portfolio, the trajectory of our liquidity and capital. And then also really importantly, focusing on, at that point, controlling expenses, given there was so much uncertainty. Then as we came out of the pandemic, really the focus changed. So the focus turned to, okay, how can we, how can we grow profitably? Where can we invest? Where can we allocate expense dollars in order to get the best return for our shareholders and that evolution, the ability to pivot from kind of one focus area to another at the right time, really, really important. So, so there, there's a saying you want to go to where the puck will be, not where the puck is. And so, for hockey fans, they'll appreciate that comment, but certainly being able to anticipate and get to the right spot timely so that we make good decisions. And we execute strongly really, really has been a focus point for, you know, our leadership team and the finance organization as a whole.  Adam: (11:12) And it seems like the innovative changes that you've discussed earlier, have a big effect on being able to meet those needs. Right?  John: (11:20) Yeah, absolutely. And, you know, we've become much more effective as a finance organization, leveraging technology and innovation. I feel like we've become a improved business partner to the organization that was, you know, a key contributor to Discover delivering record results in 2021. Now 2022 looks to be a, you know, really positive year as well. And, you know, my hope is that we'll continue that strong execution to allow the business to, continue to grow profitably.  Adam: (12:00) Definitely. So just before we close, I was just thinking about, you know, as you're working through process improvements and, you know, innovation within finance, helping the team, see the big picture can be difficult. Can you maybe give some insight of what it was like as you were going through these innovative process improvements, what it was like to help the team stay on task and get on board as change is difficult as we've mentioned.  John: (12:30) Yeah. So, really good question. So, you know, for me, the first bit is to make sure that the organization's strategy is well communicated so that we can connect it to some aspect of every single person's job within the finance organization. So we spend a lot of time in terms of communicating kind of what's important for the organization and the aggregate. And then how does that translate into people's jobs? We also, as a finance leadership team launched what we call our, the Discover Finance and Corporate Services Success Traits, and, that, that launch of that, which I'll explain and a minute was to give our teams the tools to be able to continue to execute and support the business. So, the success trait, as we define them are critical thinking. So analytical thinking and an honest approach to analysis.  John: (13:33) And by that, we mean, you know, looking at the facts, not necessarily judgments, but lay out the facts and then using those facts to make judgments really, really important. The second aspect, which I touched on briefly was communication. So being able to communicate with influence in order to ensure that when decisions are made, they're made free of bias and based on actions that will help us deliver on our strategic objectives. There's also an element which is coaching and providing feedback with the right level of empathy and specificity. So that our teams learn from what they've done well and what they can do better. And then a core component also is driving digital ambitions. So embracing technology, embracing concepts of continued improvement, improving insights and analytics through leveraging technology and proposed solutions, that'll help deliver kind of new tools and new capabilities to the organization. And then the last two, I won't go into detail on these, relationship and team building, really, really important, so that we're effective as an organization. And then lastly execution. So being clear on what you're trying to do, and then execute in a way that, is skilled to, to get the best outcomes.  Closing: (15:01) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Connect with Braden: https://www.linkedin.com/in/braden-cadenelli-a0737b108/ Full Episode Transcript:Adam (00:05):I'm Adam Larson and welcome to Count Me In, the podcast that explores the world of business from the management accountants perspective. Coming up, I speak with Braden Cadenelli about the realities of implementing sustainability practices in the food industry.Adam (00:20):Braden is a professional baker in pastry chef who runs six state-of-the-art test kitchens for Puratos, a company which makes ingredients and products for bakers patissies, and chocolatiers around the world. This podcast helped me understand how sustainability practices must be baked into the financial planning and budgeting process at companies in order to drive long term value. And Braden is finding that management accountants are excited to work with him on his sustainability issues, especially when he brings the treats. Let's listen in now. Braden, thank you so much for coming on the podcast today. We really appreciate you coming on and sharing your expertise with us. And as we jump in to get started we know that many businesses are dealing with the reality that adopting sustainable business practices is really what's needed to be successful in the future and also is what's needed for our planet. Can you share a bit about your story, about how you came to see that this is a need and how you started the process with your company?Braden (01:20):Of course, Adam, thank you so much having me on today. I really appreciate it. And I'm excited to get to share and talk about a subject that I'm very passionate about, and that is sustainability and specifically sustainability within the food industry. There's really for our specific company where I work. We're Puratos, we're a bakery ingredient company. There's really two specific factors that have led us to our sustainability initiatives. The first one is that we are a family-owned company and the second generation of those families is starting to move into leadership roles within the company. And sustainability is a very important topic to younger people. Not to say it wasn't on the radar of the generations before not to say it wasn't important. It's even more important to the leaders who are coming up now, not only through our company, but in other companies as well.Braden (02:18):The second is consumer demand. We work in the food industry. There's a large demand over the past 10 to 15 years to clean up food. And a lot of people say they want to have food labels where they can pronounce everything on that label. If you're going to put that focus on cleaning up your food label and caring so much about the food you are creating as a food manufacturer, you have to care about how you're creating it. You have to care about every step of the system that gets you to that final finished product. And what that means is nowadays you have to have a sustainable system if for no other reason so that you can continue to be a successful business in the marketplace.Adam (03:11):I can see how that would be super important, especially if you're listening to your customers. Has it been difficult to start that path as especially with, you know, you're listening to your customers, but you also have to worry about your bottom line. So there's so many different things that you have to weigh. What has that process been like? Especially, you know, obviously this is a podcast for accountants, you know, what's this been look like as you're looking at your bottom line, working with your finance team, trying to see what is the best way to do this?Braden (03:40):Well specifically in my role. So to fill the listeners in a little bit, I manage a network of test kitchens within the United States and we have six test kitchens. That means I also have a little bit of a reach into some of our other practical physical facilities. When I work directly with our finance team in this aspect, it's all about long term planning. It is all about targeting the solutions that are going to work for our kitchens, and then making sure that we have the financial capital to be able to implement those solutions. So it's really, I have monthly meetings with the finance team, making sure that I am telling them what it is that I'm going to be looking into purchasing why I need to make these purchases and building out a proper budget. A lot of my job around sustainability is actually around budgeting and making sure that I'm doing the research and I'm talking to the right industry people and finding the right solutions and then finding ways to plan for them.Adam (04:43):That's great. So you have a really good relationship with your finance team then, because obviously if you didn't, you wouldn't be able to work on this project at all.Braden (04:51):Exactly. No, I'm very lucky. I mean, sometimes I have to bribe them with a cake or a cookie or a brownie if I really, you know, annoy them, if I forget to submit a report on time or if I forget to put a project through in power steering the right way. Generally speaking though. Yeah. We have a great relationship. It's really, for me, very interesting to get, to see that side of the business and get to play a role in planning out these long term projects and what the finances for those mean.Adam (05:22):So as you've become a partner with that team, are there other teams that you've had to kind of become a bridge with to kind of make this project a success?Braden (05:32):Yes. That's a great question because you cannot accomplish anything in any kind of business. It doesn't matter food industry or not. You cannot accomplish anything without learning how to partner with and work with other departments and other people. I heard a great saying once, and it was said to catch people's attention and it was all business is personal. And a lot of people, especially if you grew up watching eighties movies, you go, well, what about all those movies where they just said, oh, it's nothing personal. It's just business.Braden (06:01):All business though is personal because you're conducting business with other people. So what I've had to do is I've had to, A.) Get buy in from my own department, because when we're talking about sustainability, we're talking about changing people's daily activities because we are changing or removing resources that they are used to having. So I need to find solutions that they'll buy into. And so that they see the long term vision of this. I then have to sell the finance team on why we need to budget for this. For example, let's say we need to remove one use disposable item, but we need the CapEx to purchase a reusable item in its place, reusable that involves a capital expenditure, right. Something that I'm gonna use once and throw away. That's more OPEX. I control. I'm lucky I control OPEX for my department. I only have a small say in CapEx, right?Braden (06:59):The other people that I really have to have buy in from is our engineering team. They're the ones who are out there helping me, scour the industry and look for solutions. And then helping me implement the solutions. Because if we're talking again from a financial perspective, it's not only the solution. If I'm replacing, let's say a piece of technology, let's say a piece of bakery equipment that is very heavy in a certain type of utility usage. I need the tradespeople to take out the old machine. They need to install the new machine. There's an entire part of that process that isn't necessarily seen by everybody, but I need to worry about it and I need to get buy in and make sure that everybody is well aware. The finance folks know the full scope of the project. The engineers understand the budget they have to work in. And my team and the research and development department know the vision and understand why this is the direction that we have to go in.Adam (08:00):So that's quite an undertaking. And I think you've kind of described, you know, what it looks like to make a kitchen sustainable, to what a test kitchen sustainable. Are there other things that you've had to like kind of work through? Like, are there some examples of what it looks like, you know, as you've gone through that change management process with the team members saying, okay, you can no longer use this one single-use project you have to use now use this, but then that, oh wait. But Braden, this is adding this to my, you know, to my task. What do I do now? You know? So how can maybe give some examples on that?Braden (08:31):Of course. Yeah. So in the bakery industry, and this is one that is really applicable to every aspect of the industry, whether you are the corner baker or whether you are creating a consumer packaged good, that goes out on a retail shelf at let's say a grocery store. And that is, I just used the word package, packaging. Everybody uses some kind of packaging and that packaging has a purpose, right? It has a function, A.), look nice, of course we want it to look nice. It also has a protective function or practical function of allowing you to pick up an item and move it with you. And a specific example, everybody in the industry, they low and they love their little gold boards that they put their little pastries or their cakes on. They love 'em they're everywhere. Go into a bakery and guess see gold boards everywhere.Braden (09:22):I came in one day and I said, well, everybody, we're going zero landfill. Guess where these gold boards go? The landfill, ding, ding, ding, ding, ding. We have a winner. They go in the landfill, guess what? We're gonna do, everybody we're gonna not use gold boards. Once we find a solution that works, ding, ding, ding, ding. Yes, we have a winner. So that was a very concrete example where we very quickly had to identify a solution that was not sustainable, that was accepted throughout the entire industry, and then work to find a solution that would meet our needs, still meet our customer expectations while being able to be a sustainable solution that in the long run. And if we wanna talk from a financial standpoint, actually save us money. And that we hit on it earlier is something that we have found from going through this process is that if we manage it well, we can actually have cost savings in the kitchens being more sustainable.Braden (10:26):In this specific example, we went to mainly reusable boards and we found a local vendor who could make them. And then when they need to be disposed of which is really once they break, because they're washable, they're reusable. Once they break, they can still be put through an up cycling process. Now, when we're going and bringing something externally to our building, we found solutions through compostable materials. And that's another key factor. Sometimes you actually have to find multiple solutions to replace the same conventional product in a sustainable environment, in a kitchen environment, really until the industry catches up. And that's actually an area where we struggle sometimes is that certain aspects, certain areas of the industry are behind are sometimes kind of aggressive goals.Adam (11:29):So what do you do in that case? If the industry you find that the industry's behind, do you wait until they catch up or do you just say, Hey, we're ahead. And we hope that they recognize that we're the leaders.Braden (11:39):There's a few different paths we can take. We will try to find a creative solution to the problem, which generally means we simply stop using a certain material. And we may even stop that process entirely and look for a new process that will, at the end of the day, get us, you know, the same result or at least get us to our goal. That's one way we can do it. Another way, if we find that we are a little bit ahead of the industry, is that we can go and we can try to challenge certain players in the industry and say, look, here's the need we've seen. And this works because where I work again, we're a larger company and we can say, look, we've identified this need. Can you help us get to where we need to be? That's a second way. A third way is really about managing output.Braden (12:41):And whenever we talk about a kitchen system, basically, as in most systems, you have input, you have output. We want to have either less input because that's sustainable. Just buy less stuff. I had a person in a meeting, raise their hand and say, well, why don't we just try to buy less stuff? And I went, you win the meeting, everybody, there's your directive buy less stuff, right? But we have to manage those inputs and we have to manage those outputs. So if we find that there isn't necessarily a new input that is sustainable, we will work with consultants who are experts in sustainable practices. And we will try to find a way to get that material through our system. And then out in a way that is better than it was before, which right now I said the word earlier, a lot of times it means upcycling. And that's an entire other issue. How people feel about that and that practice. And there's many, many different areas of that practice. We have found though that when we find the right local partners and we find companies that are doing it in a responsible way because of the volume that we can create, that can be a positive net impact for us in a way of mainly the goal there is to have less items go into the landfill.Adam (14:10):So I'm sure that the things that you've been talking about, our friends in the manufacturing industry, people who work in factories or run factories can really relate to some of the stuff you've been talking about. Have you seen the same effect that they've been, we've been hearing from them about some of the supply chain issues and those types of things. I know that food items may not be on that list, but the things to make the food items with, I'm sure you've been running into that same issue.Braden (14:32):Yes. Oh, food items. Every, every item is on that list. And that's actually been for us in at least the kitchen area of the food industry in some ways positive. It goes back to what I was saying earlier about replacing disposables with reusables, especially about a year and a half ago, there was a huge spike in the price of disposable metal pans. And there was a price increase because the supply dropped. So getting the pans became much more difficult. The prices shot up. We made the decision at that point to stop buying them. That's it, we're done. We're going to budget in the money to replace them with reusable, washable pans, just the way it was done, 50, 60 years ago. And I can tell you from going in and out of a lot of large scale factories, they have been, they've never stopped using reusable pans. They have lines where the items are deposited in the pan. It goes through it's baked. Then they have a CIP system, which means clean in place. Everything runs through this dish washing system. It's just one continuous line. And then it goes back and it just gets baked again. So it's, again, if you have the right kind of water reclamation in that point in water recycling, it actually can be a very sustainable system.Adam (16:05):That's, that's great to hear. So we've kind of covered the gamut right now and if we look at, as we kind of wrap up the conversation as if you can like look in a crystal ball, what do you think the industry's gonna look like as we go five, 10 years out and the sustainability kind of continues? Do you think it's gonna be the, the thing that everybody's doing or is it just a fad? Cause sometimes these better practices for the environment don't really last so what do you think it's gonna happen?Braden (16:33):I truly 100% feel that it is not a fad, that this is how we will operate in the future. And it will only become a more important way that we operate and that all of the manufacturers of consumables are going to shift to a more sustainable model. We've already seen it in packaging, in making packaging either 100% recyclable through your standard recycling networks or making it compostable. There are concerns there, which is why it is sometimes slow going, cuz you have to remember food is compostable. So if now your packaging is also compostable, this can become an issue in terms of the shelf life of your entire system. Especially if that system is in any way, shape or form brought into contact with water, it can kick the process off, which can be an issue at the end of the day though, this is the future.Braden (17:39):The food industry realizes that everyone that I talk to, all the customers that I work with, they realize that and they are taking steps in that direction. I would be floored if this ended up just being in five or 10 years of fad, because I go to the trade shows. I see what companies are working on. I see some of this behind the scenes work and what's coming down the pipeline and it's only going to become more top of mind and more important because there really is that connection between not only better food for you, but a better food industry, you truly at the end of the day are not going to have one without the other. And if consumers are demanding one, then the other has to follow.Outro (18:31):This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMAS website at www dot Ima, net.org. 

Connect with Sergio: https://www.linkedin.com/in/lutav/Full Episode Transcript:Neha (00:05):Welcome to Count Me In. I'm Neha Lagoo Ratnakar. And today I'm speaking with Sérgio Tavares about design thinking and why it's crucial for leaders and management accountants to understand the basics of design thinking in a digital-first business world. Sérgio is a design leader at Frog where he researches humans, culture and society to create digital solutions that better meet consumer needs. This is a very interesting conversation as we discuss how management accountants can help shape the metrics and what data designers should be focusing on to alleviate pressure points and deliver better digital solutions. So let's get started with Sérgio.Neha (00:53):Welcome Sérgio. It's such a pleasure to have you on the show. Now let's start with the basics for people who might be new to design thinking. Can you give us a simple definition of design thinking?Sérgio (01:05):Hi, Neha. Thanks for having me on the show. I think design thinking is a term that came about already in the sixties and it talks a lot about what is the customer need, the end customer need? I think we came from an era of advertising and marketing that we're more trying to persuade the people to want certain things, to consume certain products and design thinking, subverted that by looking into what they really need the things they know they need, but also the things that they don't know yet that they need and supplying these needs.Neha (01:45):Wow. Okay. I love that. And I'm totally going to steal that in my next conversation.Sérgio (01:49):Great.Neha (01:51):All right. So I like how design thinking it keeps customers in the center and what are the challenges that companies these days are facing when it comes to this customer centricity?Sérgio (02:04):Yes, that's, that's an excellent point. I think many companies are finding a lot of challenge to compete with the startup scene. I think the startup scene is going through a change now. We're a little bit past the move fast break things time. So we are seeing the downfall of the first unicorns we had. We crash Zuckerberg had so many problems with democracy and then the whole thing with the fake news. And there's, there's all the ups and downs with Elon Musk going to Twitter. So there's a lot that is telling us that this first wave or this wave was over and companies are now need to compete in a different way with startups. I think that the challenge that companies are facing is also that startups, they have very well understood that they need to look into the customer needs.Sérgio (03:07):And it's very simple for them to do that. They just get out of the building as the jargon says and run interviews fast prototypes and then create their product or improve their product. And then when you come to AB corporation, this is very difficult because there's so much procurement hierarchy and it becomes very difficult to just move very fast. So when it comes to customer centricity, I think that is where startups have an advantage and companies have problem because they need to output the results. They need to push harder, their marketing efforts, their existing efforts, and rethinking their products around the customer is something quite demanding.Neha (03:53):Right. Wow. That, that was very insightful. And when you talk about being customer centric, how does that translate to being customer centric within the organization? For example, how does your work at Frog apply this customer centricity internally?Sérgio (04:10):Yes. I think the first thing that we come as a Frog consultant, for example, we come to a customer is like, tell me where the research room is. And that usually means that there is no room. And so that means that we need to structure that. So we need to ask first let's run a round of questions, a survey out there to your target customers or to a specific segment you want to work with. And that means also that this research that you order it'll fall into an empty drawer. So you need to create the drawer. You need to create a structure that will catalog and categorize research and put it into use in product development or marketing or on the operations. So I think that's the first thing.Neha (05:05):So building the airplane as you fly it.Sérgio (05:10):Yes, yes, exactly. That just gives us a bit of speed and it's easier to show that we are getting insights about the customers. We're getting ideas on how to make our product more desirable, viable, usable for customers. And that's usually a good way to start because in corporations, you need to start convincing like the whole hierarchy. So it starts to connect with the KPIs and it starts to need to connect to the financial numbers.Neha (05:43):Right.Sérgio (05:44):So it's not very easy to sell, like, okay, in 10 years this idea will pay off, but you can start by saying, let's discover what we can do to change things right now, and how a better experience, for example, of a digital service will mean less time that people take to let's say, use our product. And that means faster onboarding, and that means more revenue, right? So when you start to create this connection, that's when design thinking connects with financial departments management consultants and so forth. These connections are quite new designers. They were often seen as the creative side, and they are usually with high fly ideas. That won't be very sustainable. But when we start to work with business consultants that that's started to change.Neha (06:42):And you're right, the perspective on design is changing everywhere. I've also heard people talk about customer journey maps and our listeners who are many of them are from accounting and finance world, would like to understand how that helps clients with the accounting, most importantly, but also their KPIs, OKRs, metrics and operations, the hard facts of a business.Sérgio (07:09):Yes. So the customer journey is basically a map of all the interactions that the end customer goes through when interacting with your product or service. So that may seem very far fetched from accountants, but I would think it's not, for example, in a model that I have developed with the client during this year we have throughout the journey, all the pain points and highlights through the experience. So let's think of a, let's say a bank or an insurance company or any service, really. So you have a person that is first deciding if they're going to buy it, then they let's say in case of an insurance, then you have the time that a person's gonna make a decision. If they're gonna get a more premium account. And then they have another part of their journey where they're actually making a claim.Sérgio (08:05):So all these the customer goes through all these, what happens often is that the designers or the people taking care of the product are looking a lot on the customer pains. And they are telling for example, the company customers need to be able to claim very fast for where they have some, a broken, broken device at home. So we need to make this very easy. And then on the other side, you have the accountants, for example, that are saying, look if we make this just immediate, we're gonna have more fraud. So I developed this model where we add to the customer journey, the pressure points that are internal to the company, pressuring the solution stores customers. And then we can have a real timeline of everything we provide to the end customer and all the pressure that the company goes through in a map. So everybody can see the problem on a bird eye view and have a clear understanding of everything that is going on and how we can solve the problems together in alignment.Neha (09:22):I love the idea of pressure points. I'd never heard that one before.Sérgio (09:26):Thank you. Yes. I think this comes from, from really, and I think that's when we start to be customer centric in our day to day, that we started to listen to our customer, like the companies are saying, yeah, the design team is very happy, but they're not getting their ideas through. When they, even if they pointed out in the customer journey and, and then we came up with this concept that let's use the pressure points, because that's when we have our limitations, like, we simply cannot give this solution for free. Let's say there's a financial pressure here. And also one thing that might be, it'll be very important. The collaboration between accountants, for example and consultants on the business side to tell designers and decision makers, innovators, what are the differences in different OKRs KPIs, and even what is the difference between a lagging indicator or a leading indicator? Because designers, for example, when they're improving the product, they just hear the, the simplest ones, like we need higher revenue. But they can help to discover the root cause of a problem,Neha (10:43):Right.Sérgio (10:44):And the business consultant for the accountant can help them to convert that problem into a metric. And that will be their root metric or their leading indicator. This work is very nascent. I don't see many companies and I've been working in this model with our Milan studio in Italy and exchanging a lot of information with our American studio in San Francisco, it's rare to have the interaction between people that work only with numbers and then people that work only with product development.Neha (11:19):And thank you for being that bridge between these two parties. That communication is super important.Sérgio (11:25):Yes. I'm trying, I'm trying.Neha (11:29):All right. So let me pivot from that to some other things that I've heard in the field of design thinking like prototypes or minimum viable products. And I'm trying to connect that with accounting, for example, which is a very rules-based field. Now, how can what can accounting and finance people learn from the field of design thinking if they had to take some practical tips and start implementing tomorrow to become more design oriented, or more innovative, what is it that they can start doing?Sérgio (12:02):Yes. Neha, this is an excellent question. And I think I could say also things that the accounting teams can teach or coach the design teams with. But first I think accountants may benefit from thinking a little bit less on the big scale of what projects can become. So they start to do the number crunching. And if we invest, let's say in this new product, we're gonna be able to see figures break even in five years and so forth. This business case of five years is going really out of style because it's based on a lot of fictions, right? You have very good estimations and such, but the minimum viable product school of thinking and the design school of thinking, say, let's create just a trailer, just the first thing that we can get a signal from the market and see if people respond. If they respond, we can finance the idea for more six months.Sérgio (13:08):And and this can go it can save a lot of these initial investments and the CapEx of the whole thing. You don't need to put all the coins in the same basket all the eggs in basket, you can just work with the first signals and, and confirmations. But now we come to the idea, if this, if a company does this once and then twice, and then five, 10 times, they need a system to govern innovation. And that's where accountants would be really valuable. Okay. Because they can create a system, like you said, thinking in systems, like how can we know that an idea is gonna pay off, they need to hit a certain target in certain amount of time. And it's not really a given to understand that people that have sometimes great product ideas, even when they are inside companies, they are not sometimes very good in governing this idea and keeping the tab on KPIs. And I think the accountants may take a role of not being the, the checking department or kind of the red stamp department, but more like the coaches that say, Hey, this is something that you may be able to do, or this is where you need to invest so that you hit your KPI. So you become a mindset of nurturing when you start to really help them to do the accounting, which is what you are best at.Neha (14:46):So one last question is is with the companies going remote first, these days, what is, how do you think has design thinking changed the way we think, or has design thinking changed as a result of how companies are changing?Sérgio (15:03):Yeah. Well, there's a lot going on in this cultural shift. And what we are seeing now is the rise of a truly hybrid mode of working. And by hybrid, it means, well, let's say our playing field is the workshop. So it's where we take all the very strong knowledge that every stakeholder has in their minds, and try to put together in a board with sticky notes and that kind of stuff. So it's more about organizing the ideas so that we come up with something new. And with remote work, there was like concerns that this process can happen, but they started to happen in online boards like Myro or Neuro. Actually, they start to open new possibilities that people can concentrate a little better in their own individual work, that they can contribute to that along the day. And only later join the workshop. And there is even a mode where we are experimenting now to use the digital board, even if we are in a room because it's just so easy to output more ideas, or then to erase and move,Neha (16:20):And also to read sometimes. So it's legible.Sérgio (16:24):Exactly, exactly. And there's not that person that will need to take care of all the post-it's right. Or all that kind of operations that the team needs to take upon. Also, it's common that in offices, you need to clear the room after you leave there's confidential information. So all these starts to be solved, and it doesn't mean that sometimes you shouldn't be all together without devices, because there's, there's an added value that to that too, you're able to maybe focus or pay attention to listening to more to each team of the, of the project. So I think there's a hybrid model going on. We are still discovering what it can do for these creative processes. And I think we should try to listen to what the teams are bringing and how they are most productive when working.Speaker 3 (17:25):This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Contact Michael Teape: https://www.linkedin.com/in/teapetraining/Teape Training International (TTI): https://www.teapetraininginternational.comGet my FREE eGuide 7 Best Facilitation Tips to Ensure Engagement & Learning to ensure your Online Training Success -> https://tti-signup.ck.page/eguideFull Episode Transcript:Adam: (00:05) Welcome back to Count Me In. I'm Adam Larson. Today, we welcome back Michael Teape to the podcast. Michael is a well known management coach and co-founder of Teape Training International. And he is here today to discuss how businesses can maximize their human capital, as we begin year three of COVID 19 era, and the Great Resignation continues. If you are a leader, trying to get your team back to business as usual, you do not wanna miss this insightful conversation. So let's get started.   Adam: (00:38) Michael, we really appreciate you coming on our podcast today. It's a pleasure to speak with you again, to have you come back to count me in.   Michael: (00:45) Thank you. It's great to be here, Adam. Thanks for having me back.   Adam: (00:48) Definitely. So let's just jump right into our topic today. So in your work with clients across businesses, how are people doing with the crisis as what we are heading into, what, the third year of it?   Michael: (01:00) Yeah. Can you believe it three years? No, that's just, yeah. Crazy. Well, it, every year it's changed. Right? Cause you can imagine that and as your listeners reflect back, they're gonna think, well, yeah, there was absolutely in the beginning, we didn't know what we didn't know. We were washing our vegetables, you know, we weren't going to the store and now we're way beyond that. We're managing that with seen threat come into our work. People have got COVID people have not gone to the hospital. Some have, unfortunately, so you've experienced it over two years. And as we come into the third, it's kind of normalized. It's baked in, it's like you get used to your environment. So, you know, most people are like, well, this is a reality, Adam, if I'm honest, that's what they're saying.   Michael: (01:50) And they're, going back to doing well, you know, may as well do the training. And from my point of view, you know, as a learning development specialist, face to face stuff was canceled the first year. And now in the third year, it is back on again, you know, they wanna do face to face. Haven't done it in a while. I'm not so sure that the employees want to do face to face. Cause they've got used to the virtual environment and they've worked out that actually it can work. It does work. We've been able to talk over, you know, over a virtual, just as much in fact, better than face to face, because face to face, most people wearing a mask, depending on which state you go to, depending on their level of infection. Yeah. So, you know, that's where we are right now.   Michael: (02:44) Also what I'm seeing Adam is people are moving jobs, you know, you've heard of the Great Resignation. So that's the other thing is really picking up speed now in the third year. The thing with that is that people are seeing opportunity. There is opportunity. So they're realizing that, well, I can work from home so therefore I can work pretty much from anywhere. Right? Yeah. So it doesn't, they're not as limited as they were before. So that's how people, I feel people are expanding their horizons on the work they can do and getting so much more comfortable with doing at home. So we've entered this era of flexibility. Unfortunately, last thing I'll say. And if, and those of you listeners who are leading others, I would say, this is that they're not being flexible. All right. So leaders have got to continue to be flexible.   Michael: (03:41) Even with the picture, the move back to the office. We want all of you back in the office, right? We want you all to come back and, you know what, we're losing some of that flexibility we've had for the last two years in this third year. And I feel that if leaders learn to continue the flexibility, they can continue to take advantage of a more flexible workforce and make them want to stay, want to work if you put in what I call, yeah. Of fake rules, unnecessary rules. Unnecessary. And I'll give you an example. There's a company that I know that remain nameless. They're like, right! We're all coming back to work. They've all been hundred percent remote, fairly small company. And right. We want all back at work, but we want you in Monday, Thursday and Friday, you can, you know, we'll be virtual Tuesday and Wednesday.   Michael: (04:38) You're getting these unnecessary rules and you must have your meetings. We want them face to face. So you need to have your meetings on the Monday, Thursday or the Friday. So you can imagine employees are like, hang on a minute. What if I wanna have a meeting on Tuesday, it creates all these unnecessary rules and decisions to be made when wouldn't, it have been easier just to say to the each team work out what days you wanna come in the office. We want to build up to a hundred percent back, but you know, happy to do 60, 40, whatever works as long as we're serving the client internally and externally, you know, I leave it up to your best judgment to make sure the work continues. Great, right? And then they can work on it. What works best for them? I'm seeing this over and over again. So how are people doing the crisis? I think they're doing quite well. They they're normalized it. They're getting on with it. They're looking for opportunities, other jobs. What we've gotta is being overly formal with how leaders bring their people back and teams back. We need to stay flexible.   Adam: (05:46) Yeah. So I can't imagine staying flexible would allow you to keep your workforce better because if you become more rigid, it says, well, if you're gonna be rigid, then I can just move on. Are there other tips that we can offer? Like for, you know, if you're thinking, okay, I lead a team, how can I adapt my team so that I can continue like being flexible, but what are other things that I can do to help keep my team together, but still be productive?   Michael: (06:13) The productivity is a funny thing. Yeah. So that's the first thing I'm gonna talk about here. Is it relax? Have they been productive for the last two years? Look at that. Has the performance been where you wanted it? If it is, you don't have a productivity problem. Yeah. If it isn't, then let's get into more communication with the team about your expectations. So focus. I think leading through this time now back to where people feel that COVID, isn't a day to day occurrence, or there's not another wave or they don't know tons of people that have it, getting people back, they really need to focus on what they want to achieve. And the way you do that with teams is you communicate with them. You ask them how it's going. You set expectations of what you're looking for.   Michael: (07:05) And then you coach them. You're really, really good at communication on, well, how are you prioritizing? How can I help you prioritize what you need to be doing in this time? What are some of the roadblocks getting in your way is for that leader to switch from, "I've told you my expectations" into a coaching style and that's how they help their teams through it. Because the coaching style does two things. It helps when you coach someone, it helps them put them in an adaptive, calm mindset. They are reflecting on the question you've asked, they're not in the, oh, make panic of getting the work done. If they're under stress, they're not think of anything else they're connecting with you. And you're giving them that reflective time to calm and think about their position, which therefore leads to more productivity, better prioritization. So yeah.   Michael: (07:56) So they're the two things. And the last thing is don't give up, you know, always come back to an employee. If you've had a feedback conversation, you had a coaching conversation, come back, come back and ask them, how did that go mention, well, you mentioned you were gonna try this this week. You were gonna try and be less reactive to email. How did that go? So you end up coaching your people rather than saying, look, this is, this is what you need to do. You're not, you're not getting all these accounts done. We're 10% down. I need you to put another hour in the day. You know? So we are moving from autocratic style of leadership, which helps the leader feel in control to much more democratic style. And with that comes flexibility. But you know, I see a lot of leaders jumping like, oh, you know, I've gotta keep productivity up. And then I ask them, well, what's your productivity like? And they're like, good question. I don't know. I've not thought about it. I just assumed because everyone went virtual. I need to watch this space. So it's unnecessary. Right? So I hope that answers a question, Adam, and, you know, and helps management accountants listening to this. How do I manage my team without overdoing it? Don't overcook it.   Adam: (09:14) Yeah. You don't wanna overcook it cuz you don't wanna put force on them to come into an office where remembering that it's gonna tire somebody out more because they're seeing people in person which means you're gonna have other conversations outside the normal conversations you'd have. You're actually gonna be probably a little less productive going into the office cuz you're gonna see people you haven't seen in two years. So you're dealing with all those things. And so if you push everybody to be into the office, especially like on a Monday and a Friday who wants to be in office on a Monday and a Friday? Make 'em all come in the middle of the week. Cause I mean, no one ever wants to be in the office at the beginning and the end of the week, you know, you gotta find, you gotta be flexible, but you have to take into account because the wellbeing of your team is super important because, you gotta remember, they've had two, almost three years of working from home working, you know, working out schedules with kids and taking people everywhere that you have your schedule set and all of a sudden's like we're going back to work and you're disrupting people's lives.   Adam: (10:08) And so as they adapt, you know, you have to kind of, you have to adapt your style of leadership, but I think it's disrupting people cuz they're either in the office or not in the office and they don't know how to hybrid it.   Michael: (10:21) Yeah. Yeah. Making the most outta the office experience is something we should be coaching again, that word coaching, right. We should be leaders should be saying, so, you know, you're coming back to work in the office. What do you think is gonna be the most useful use of your time in the office and you know what it's meeting people face to face. It's not going through spreadsheets. If you want the quiet time, you know, do that a bit later on. But the funny thing is you mentioned, you know, I'm going back to this Monday, Friday thing, yes, you are a hundred percent, right. Adam, it's known, look, let me get into the week and I'll turn up Tuesday, Wednesday. So that the example I gave of the client that got it around the wrong way. And, and when I spoke to some of the employees, they were suspicious as to, well, do they not trust us to work on a Monday?   Michael: (11:08) Do they think we're gonna take a three day weekend or a four day weekend? And my answer to that is, well, if you are being measured, which you know, when you talk about accounting, there's a very, very obvious result of your work, your productivity, you get the accounts done, you know, certain spreadsheets done things ticked in the box, regulatory deadlines. If you don't hit those, it's very obvious you're gonna miss them. So giving someone a Monday as their work from home makes no difference, cause they'll either need to get it done on Monday or they won't, they were gonna do it anyway. At least it's like really? And so now you've got a workforce questioning why? So it's really, you know, controlling what's important and letting go of everything else. And you know, in this world of accountancy there's so it's so specific.   Michael: (12:04) It's very easy to let someone go flexible and then just measure the results as they come in, have a discussion, ask them about, look, this is actually, I need you to do my expectation is for you to do twice as many accounts in three days, you know, how are we gonna achieve that? But it's still a coaching technique. And that's how people wanna be talked to right now. They wanna be included. And you mentioned wellness, wellbeing. So we shouldn't just leaders should not just be talking about the work productivity they should be talking about. Are they varying, you know, are they burning out? Are your people burning out? Do they have the right level of social interaction? Or are they just sitting here 24, 7, I'm coaching someone right now who's incredibly bright off the scale. Fantastically, is gonna be hugely successful.   Michael: (12:55) But that person who's struggling with clocking on at six 30 in the morning and working through just seven o'clock at night, barely taking lunch because they feel that's the expectation. Couldn't that be sorted out by a leader, having a real discussion about what are you, you know, what are you doing throughout your day? Understanding the cycles of work when you should take breaks and a leader saying, it's okay to take a break. You know, do you really need to log on that early in the morning? I don't think so. So yeah, it's not about, it's funny. We, but people try and manage time leaders try and manage time. They should be more managing the conversations we have and up the purpose and the why we are doing it. And yeah, release that time element. I'm so surprised that people are still so caught up on, well, I need this person at the desk. If you're acquiring somebody to be there more than eight hours a day, the eight hours are not productive. And that's, you know, that's what I find is really holding people back from the wellbeing. And I don't think people are taking care of their wellbeing, Adam, to be honest, not properly.  Adam: (14:06) Well, and we've talked a lot about leaders looking at their teams, but what about the leaders? They're not looking at their wellbeing either. And so as a leader, you have to look at yourself and say, okay, am I well enough to be leading my team, coaching my team? And am I using my time properly? And you know, we have to apply the things that we're trying to coach our team members on in ourself, right?   Michael: (14:27) Yeah. I mean, there's things we need to do around our work to help our wellbeing now. CPAs and other accounting professions have a crunch deadline, right? April, the end of the year. So they're used to this, cramming the work in around those months and then hopefully taking a bit of breather afterwards. So they might be, they might be thinking about, well, actually just maintain this amount of concentration, right now, right. We're coming up to deadline time right now. We need to make sure that we are going out and having rituals routines we're going for walks, reading other material, taking a break, small breaks on a regular basis. Yeah. And then fueling the body with the right energy, which is the food that we eat. Thinking about that short term, food, coffee, soda, all those great things to give you that punch that you need.   Michael: (15:30) Say if you're not feeling great, but you know, you've got the next three hours to get through, are not gonna help you long term. You need to be looking at foods that released energy over a longer period of time. And really Michael, you're talking about food? Well, I am because if you wanna sustain months, which I know they do anyway. But during this time months of productivity, you have to be in it for the long term and good routines around, movement that we are moving where you actually look as well. I dunno if anyone's talked about this, but if you think about when we are looking at the screen, as I am right now, I'm looking at my computer screen. When I'm talking to you, it's a short term, it's a short vision. I'm looking at the short range depth, and I'm looking at an electronic screen, okay.   Michael: (16:22) That tires you out. Your optics, your eyes, all of that great stuff. Tired. You need to look away from the screen and look at a view, a long depth. And what I do is I often say, if you haven't got time to take a break, at least stop, instead of checking your phone or your Facebook or your, whatever your social media is, I'm showing my age. Cause I'm saying Facebook, and look out the window, hopefully you've got a window. You need to find one and name what you see, oh, bright sunshine. Oh, the weather's cleared up. The trees are coming into bloom. You know, you are naming what you're seeing the future. Cause it gives you more, a wider lens of your brain and it calms your brain down. If you are only looking at the computer screen, spreadsheets, emails, popups, and that, it will drain your energy and definitely your critical thinking and decision making. For sure. So yeah. They gave you a lot there to unpack.  Adam: (17:23) You, you have, I've read somewhere where it says like you have to do that, like at least once every hour where you do that like a couple minutes, and then that alone helps reduce the strain on your eyes, the strain in your brain, just, just doing that alone throughout the day will improve your wellbeing as if you're working on a computer all day which can do wonders for everybody. Even just hand exercises, you know, making sure your hands are stretched properly. If you're sitting there typing all day, just simple things as that, that we have to do because, and for some people, when they started working from home, they started working more hours because they were home. They could just sit down and go like from six 30 to seven, but it it's trying to making sure your team is finding that balance. And even you as a leader, finding that balance.   Michael: (18:08) Yeah. Most importantly, for you as a leader to do it first, because you are the one that everyone relies on, you know, you're the person having the conversations, they need you on your game. And plus the techniques you learn, you can then impart, share to your team what works and what doesn't work. Everything I talk about, I'm doing myself now. Some days I'm doing it badly, you know, I'm no Saint, but other days I'm like, oh, okay, well I use this and I then can introduce it to my teams, my clients, and help move them forward. Productively. Like I said, as long as they're focused, what do I want to achieve is a focus, the approach is a flexible communication style. I suggest that coaching style, cause you're asking questions about the other person rather than telling. And then lastly, consistency that they consistently meeting with their people.   Michael: (18:59) They know that the catch ups coming, they know what it feels like, you know, know it's gonna be supportive. And then of course their own rituals in the day to make sure that they are, you know, they're managing their energy well, you know that they're clear on what they're trying to achieve today. They're not over putting too much into a day just because I don't have a commute anymore. You know, you still need some kind of downtime between switching from being in your office or your converted closet, whatever you've using as an office, switching off the light, walking out the door into whatever awaits you, your family life, your personal life, walking the dog, those kind of things.   Speaker 3: (19:45) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Connect with Bharat: https://www.linkedin.com/in/bharat-kanodia-asa/ Tedx - https://youtu.be/zicGCnM8HagYouTube channel - https://www.youtube.com/c/whatsitworthBlog - https://www.inc.com/author/Bharat-KanodiaFull Episode Transcript:Adam: (00:06) Welcome to Count Me In I'm Adam Larson. And today we're exploring the art and science of business valuations with Bharat Kanodia, the founder and chief appraiser at Vatra and Silicone Valley. Bharat has valued over 2000 businesses and unique assets, including Uber, Airbnb, and the Golden Gate Bridge. In our conversation today, he shares his insights on how company founders can seek to maximize their valuations and the key questions to ask venture capitalists before taking their money. It was so exciting to get an insider look at this process that drives so many of the innovations and companies in our lives. So let's get started Bharat. Thank you so much for coming on the podcast today. We really appreciate you taking time out of your busy schedule to meet with us. And today we're going to be talking about valuations and venture capital and all that. So, just to start off, why, do valuations matter to a startup when you're just getting started?  Bharat: (01:10) Adam, thank you so much for having me. Startups never have a profit and they're lucky if they have a product or customers yet they need to attract investors, employees, and customers. So how do they do that? They do that by using a pie in the sky currency called valuations. And so company raised so and so money at this and this valuations, that's a pie in the sky. That's just, you know, way for them to attract people. That's their marketing almost nowadays.  Adam: (01:50) So is that actually accurate? Like how, how many times is that valuation actually accurate when you actually find out what the profit of the company over a certain period of time?  Bharat: (02:00) Well, accuracy used to be absolute back in the day, but now accuracy is measured in shades of gray, if you will. So yeah, I mean, you know, somebody cut a check for that valuation. So who am I to say that number is not accurate? It is accurate, but I would say it is inflated. and the reason it is inflated is because say, if somebody paid, raised $5 million and the evaluation is a hundred million, they paid only a $5 million for a fraction of the company. So they extrapolating that 5 million to a hundred million. Now, if somebody were to buy the entire company, would they pay a hundred million dollars? Probably not. It's kind of like difference between wholesale and retail. If I buy one cup, it's $5. If I buy 50 cups, it might be a dollar a cup.  Adam: (02:57) That makes sense. So that would be why a lot of valuations that you see, especially like when you hear about 'em on in the news, that would make sense why they're so high. So many times  Bharat: (03:07) They are high all the time, bebecause plus they also wanna show their employees that, Hey, look, last year, our valuation was 10 million and now it's a hundred million. So we've grown 10 X  Adam: (03:19) .  Bharat: (03:19) So you ought to be working harder and doing good things, you know? So this has become their marketing. You know, you never hear in the media that this company was at 10 million last year, and this year they're at 8 million. When was the last time you heard those news? No, never because they don't get traction. They're not sexy. Yeah. They don't get attention. So you only hear all these news and these headlines about these inflated valuations, because it feeds into the whole venture capital ecosystem.  Adam: (03:53) So I'm a venture capitalist, you know, what should I be looking at before I start investing in a startup that I see, oh, look, this has gotten, you know, this valuation, what else should I be looking at? Besides the valuation.  Bharat: (04:06) You should be looking at what they're going to do with that money. What have they done with that money? Have they grown that company that much? Or, just simply ask, Hey, why did you receive a, 5 million raise at a hundred million valuation? Explain it to me. Why? You know the question why, you'd be surprised is the most important question that people need to ask the how and the who and the, what, you know, you get lost. The why is the real question? And let people answer that question to you. You know, sometimes they'll explain it to you and sometimes they'll just say, Hey, somebody cut me a check for 5 million at a hundred million valuation. I am not going to say no.  Adam: (04:49) Hmm. I mean, not many people would, right?  Bharat: (04:52) Well, sometimes maybe you should, because at each inflection point they will expect you to double the valuation. So the next time you go out and raise capital and you're not able to raise capital at 200 million valuation, you're a loser. So whatever valuation you get this time, make sure you're able to raise, at least double that valuation next time.  Adam: (05:17) So how do you do that?  Bharat: (05:20) The biggest way to do that is to make sure your product is getting traction is growth in the product. They don't venture capitalists don't care about profitability or revenue. Anything like that. What they're really caring about is is your product or whatever you are putting out there as a product or a service is that gaining traction. And one of the metrics to measure how it's gaining traction is revenue. It's one of the metrics it's not the only metric the other metric could be. I don't know, traffic or users or what have you, but you have to just make sure whatever product or whatever you're putting out there is gaining traction. And it's doubling in size every year. If it's not doubling in size every year, you got a problem.  Adam: (06:03) All right. So, you know, your venture capital, your venture capitalist has said, okay, we're going to start. We're going to looking into your start. Investing in this startup. Are there multiple valuations that can happen to see? Hey, like this is where we're at at different times. Is that something that is commonly done?  Bharat: (06:20) Yeah. Most definitely. For example, this Stein, right? You're looking at the back end of this Stein. I'm looking at the front, right? I've got the logo here in the front. Somebody's looking from this side. Somebody's looking from top. Everybody sees a different perspective of the same time, but it is the same Stein. So everybody, you know, depending on the tax person or the accountant or the insurance or the investor or the employee, everybody has a different perspective off the valuation of the same company and they're not wrong. It's their perception. It's their perspective. but it's the same company. So if the company sold raise capital for, you know, raised $5 million at a hundred million valuation, that is one perspective. That is not the only perspective. That is a perspective. There could be another valuation of say 50 million or 20 million or zero. You know, somebody might say the company is worthless. Who's to say they're all incorrect. I would say they all are correct. Depending on the perspective they have.  Adam: (07:36) Do you have any examples of, of, of a time you've seen that happen?  Bharat: (07:42) Not one or two, I mean, many, many examples. I mean, every company that's out there right now, every company, not one company pick a company, you know, that recently raised capital. So, you know, any company that recently raised capital their, valuation for what they raise money for versus their accounting versus their valuation. If they're looking for a bank, loan is going to be very different.  Adam: (08:06) Yeah. That makes sense. All right. So let's talk about the founder of a startup. Are there ways that they can help maximize the values they're going through all this process that we've been talking about so far?  Bharat: (08:17) No, isn't that a million dollar question? Isn't that the question you want? Really the answer to that, how do I maximize the value of my company? It's kind of like going to the doctor and asking, Hey, how do I get taller? Or how do I, you know, head back on my blood pressure? so this is what you do. There are two ways you can value maximize the value of your company. One is you want recurring cash flow. You want recurring cash flow. You want stable cash flow. so what does that mean? You want to be in a business where the same customer is writing. You checks weekly, monthly, quarterly, yearly. You don't want to be in a business where you have to go out and find a new customer on a daily basis.  Bharat: (09:12) That's one, two, you want to run your business almost like it's on autopilot. So you want to use technology quite a bit. You want to have layers of management so that things are done without you getting involved on a day to the basis. now how do you do that now as a founder or a bus as a business owner, you could say that no things won't happen without me. Well, that might be true, but you might not be able to get a hundred percent to autopilot, but how about 20%? How about 30%? How about 50% start somewhere, start pushing technology in your business, wherever you can or start delegating wherever you can. And eventually you will go from 10% to 20% to 30%. Don't just start off by saying that, Hey, my business can't function without me. That's not going to work. So few things.  Adam: (10:08) Yeah. That makes sense. So, as you know, as they're doing that, doing the suggestions you just made, and then they start meeting with different venture capitalists,, trying to work on the funding that they need. Are there certain questions that they should be asking as they're going through that process?  Bharat: (10:26) Yeah. Plus question, you should be asking a venture capitalist, why should I take your money? How are you going to help me besides money? Right? I mean, there are many people who can write a big check. That's not a big deal, but how will you help me? How will taking your money? Help me. That's a good question to ask, how will you mentor me? How will you bring in more customers? How will you help me grow my company instead of just money? And two, just ask them, what will it take for you to give me a double valuation next time around? So if my valuation is a hundred million dollars and I just raised 5 million from one person, ask them, what will you be looking for to give me a 200, 200 million valuation? They know they want to tell you, ask them.  Adam: (11:25) So as we wrap up our conversation, I, I can't help, but wonder what the, how the market has changed, you know, in the midst of COVID and everything that's happening. And as we've come out of the pandemic and, wars happening around the world, what do you think the market and startups are going to look like? You know, as we go five, 10 years into the future,  Bharat: (11:48) Raising capital will be, relatively straightforward. People are going to be using more things like crowdfunding and crowdsourcing and going to a big sharp venture capitalist, kind of like what's happened to the publication world, right? You can, self-publish a book through Amazon, but you could also go to one of the big boys in publication like Simon and Schuster or John Wiley are one of those. So depending on what you want, I think more avenues of, bootstrapping are going to open up.  Closing: (12:24) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMAS website, www dot Ima, net.org.

Connect with Casey: https://www.linkedin.com/in/caseywoo/Full Episode Transcript:Adam: (00:05) Welcome back to the Count Me In podcast. I'm your host. Adam Larson in today's guest is really interesting. Casey. Woo. Casey's been a strategic financial leader in Silicon valley for the past two decades, investing in an operating high growth tech and tech enabled companies. He is the CFO of landing, the former head of strategic finance at WeWork and the co-founder of operators Guild, a knowledge sharing community for CFOs and other business operators. And that's just what he is been up to lately today. Casey and I put the microscope on the CFO and how the role has evolved from being the sheriff of cost and budgets to now being a company-wide business partner, focused squarely on the most important metric of all growth. I hope you enjoy the conversation. Casey, thanks so much for joining us today on the Count Me In podcast. we're going to jump right into some, questions we're gonna be focusing in on the CFO. And so to start off, what are some common misconceptions or what is the hook's historical perspective on the role of the CFO?  Casey: (01:12) Yeah, I think I'm probably not going to be novel here in my answer. There is a pretty classic stereotype of a CFO, to borrow a phrase from a friend, you know, there's CFO. No is basically one of them is Dr. No, the, you know, DBER, you know, the nickel and dimer, the no personality, the, yeah, the one that says no to everything in terms of costs and other words like the budget, right? The people think of, you know, my travel and expense reimbursements like that. That's when you get to real stereotypes of just don't you do my team reports, you know? And so, of course at the corporate level, you know, CFOs are, I don't know, misconception, hopefully this is a good conception, but they're the honest broker, right? They're the one who engages with the board as the air quote, pseudo check on leadership, et cetera.  Casey: (02:15) So there's not some misconceptions, some that's true. Absolutely. You have that. A lot of it now is not true. Yes. We manage budgets and money and have that purview. But I think there's also, what's now called CFO grow rather than CFO know. And I do think there's a healthy way to manage in a very responsible way money, but also, and I think the word is invest, right? So they call it strategic CFO. Money is meant to be invested, I guess, saved as well. Right? So when you're, especially in high growth, VPs are not giving you money to sit on it. It's put it to good use and the word is good. Use, not reckless use. and of course you're going to balance a lot of things. So one is just a strategic minded investor mentality of where you want to allocate resources is I think more what's happening. and it's not just about nickel and diamond. there's also, you know, more personalities CFOs than people think it's very, cross-functional. Some are extroverts, most are not, but they can be a very friendly person who empowers ends a business partner rather than a police force.  Adam: (03:34) So when we look at the space of a CFO as an operator, you talked a little bit to me about your operator's Guild. What personal experience do you have and what have you gained in this level of expertise?  Casey: (03:45) Yeah, so, I mean, for those who don't know, the operator's Guild has been going on for eight years. It started as a eight, nine person friend group of operators that we support one another. Now it's about 600. I say this because there's a lot of conversations, there's a lot of learnings. So I'm only going to scratch the surface. A, few things. One, all of businesses, all of startup is, is a bunch of people who decide to get together at eight in the morning to build something, to sell for more than hopefully it costs that's all the businesses or a startup. Let's call it a startup call, whatever you want to call it, just, and notice it's humans, you take away the humans, computer's not going to do anything themselves. And that's number one is business is a game. So when things are crazy or stressful, it's like, no, one's dying here.  Casey: (04:39) This is not real life and death. It's serious. Don't get me wrong. We are very competitive, but there's a lot of natural dysfunction when you toss in money, growth expectations and people, dysfunction is just basic. So that's kind of a learning. and, also work with good people. It just goes back to the business is just a bunch of people. It's not worth it. You can make your money elsewhere. If it's not with good people who respect you, who you respect them, shared values. It's actually very similar to a marriage it's just not intimate, right? But it's the same thing. Shared values. You go on dates that are called interviews. You get divorces, you know, it's because when things are not matching up, another one is don't let stereotypes or misconceptions tell you how you should act in your role, play your strengths, establish yourself as if you're gonna be a strategic CFO, be one that said, maybe you have a, stronger person who compliments you on the expense side.  Casey: (05:42) Who's, much more, you know, doctor knows so to speak, right? That're all really, or, vice versa. You're someone that's extremely conscious. You know, you need to marry that with someone that's a little bit more strategically minded and growth minded. Just,, that's just an example, but, play to your strengths, be who you are and hiring is super important. Probably the key to everything, all things in start are just problems. All we're doing is problem solving every day. If you can put together the right team tools, resources, you can solve any problems. So those are kind of learnings.  Adam: (06:19) Okay. No, that's great. I think that's really nice. and just thinking about the CFO, you talked, when we, my first question, you talked a lot about the misconceptions you knew. I think you laid that out very nicely with the Dr. No, and the Gilbert examples and stuff. but a lot of people tend to under underestimate what the CFO sees because because of this, these misconceptions that can be there. And if the CFO hasn't established himself as like a business partner, it can be very difficult to get a seat at the table. Can you talk a little bit about what the responsibility the CFO has to kind of get there so that they're not underestimated?  Casey: (06:54) I think the first one is before you get married, you should establish that. I would question a company where CFOs not at the table, not, not because of CFOs, you know, all that. It's just because it's, too important of a function just like CRO or CTO. So that's just point number one, if you're fighting to get there. So something's already a little off and you need a question, how they value and what they expect from the function. If you're in the unfortunate seat of, you're not, don't have a seat at the table. I think it's a very clear, I believe in explicit conversation and communication. It's like, Hey, Mr. And Mrs. CEO, this is a function that's critical to the business. I'm not talking about myself. I'm talking about the function and for the sake of the business and our stakeholders, it's important that I'm in the room or whoever's leading a function. Would you agree or disagree if they disagree? I would seriously consider finding a place where you can make a bigger impact and, and be valued, because it should be a high impact role.  Adam: (08:05) So you're you have the seat at the table, you know, , you're there with everybody. What does that look like? What does that, CFO's responsibility look like today? As opposed to, you know, the stuff we've already talked about, the misconceptions and the Mr. No's and all that stuff.  Casey: (08:23) The, first thing is I believe all functions should be business. First function, second business, first legal, second business, first accounting, second business, first marketing, second. Everything is in service of the business. So I think that's the first mindset you should have. The second is there's a difference between tactics and strategy asking very important questions I think is actually something that people underestimate in terms of stirring conversation, getting to know the business better, and at a certain level. So I think when you're at that table, depending on your audience, you do need to operate and talk at a higher level and not get caught in the weeds at the same time to be at that table. You need to know the details. If you don't know them for details, they, you know, they just call you ivory tower. Right. You're just talking without really any true understanding of the business.  Casey: (09:21) So it's both understand the business well, but elevate up and talk at a very strategic high level. in terms of topics of conversation, I think generally I like to call it non-linear so rather than, oh, we need more revenue. So I guess we need to grow the sales team. Like, okay. That's like tactical and sometimes obvious it would be if we have an asset heavy model, should we consider asset light? Have we tried to take this entire team and move them to a lower cost area? We do, you know, one idea that was awesome. Wasn't mine, but it's like, Hey, we, do host checkins. What about self-service checkins? So be a part of the business discussion, product discussions and all of them. When you think about it, just lead to better allocations of capital, right? People think capital allocation is, more of a budget product is a major allocation of capital where you said where you spend it, what types of products generate, what the return on that.  Casey: (10:26) So that that's really where I think the CFO now sits. And of course there's fundraising, right? The most unique thing about a CFO is that they really help with the, capital needs of the business. So there's a whole bunch of strategy there there's risks. You take there's intentional risks, there's unknown risks. There's. And the last thing I think is preparing ahead, seasoned operators, the benefit they bring is they see six months, 12 months, 18 months, 24 months out because a lot of times the breaking distance on these high growth companies are so far, you have to be making decisions today to affect 12 months from now. And unseasoned people unfortunately find out when the brick wall is in front of their face and you're going at 700 miles per hour.  Adam: (11:14) That's quite a visual there. what you've been describing, really kind of connects for me like the CFO, how important they are with things like strategy and data and understanding those things. And you present those things properly for the organization and, and giving the, the input that, that is there for the strategy when, determining those things and having the right data in place to, to support that, are there, can we maybe focus a little bit on tools because when you're a CFO, you need the right tools at your disposal. Are there some common tools that help drive strategy? And maybe you can talk a little bit about innovation there. and I think what's most important for our listeners is, you know, how do they go about getting their hands on these tools and learning from them and learning to use them? Because I think that's because you don't want to be that, that, CFO with the brick law, right in front of you going 700 miles an hour, you want to be prepared and get to that point where you will become seasoned. And that way you've described.  Casey: (12:09) And the biggest change that I actually forgot to mention, but misconception is I think the office of the CFO will eventually become the business intelligence center right now. BI lives can be living under itself. It can live under a COO, it can live under product and engineering's very common. But when you think about a centralized organization, a CFO comes to mind. Why? Because we're finance. I think about like the nervous system nervous have to be everywhere. The bloodstream, it has to be everywhere, but it feeds nourishes and helps and partners with air quote, the organs or the functions of the business. So number one tool is data. So number one is having the data. Number two is clean data, which is the biggest and hardest one. After that it's systems and tools to democratize and extract decision making insights. That's what I think is where the CFOs headed.  Casey: (13:12) And this goes back to, you know, my, I have a mentor who, made a famous analogy of finances like the weather there's three levels. And the goals that get to level three, which most do not get to level one is reporting the weather. What happened yesterday? It was sunny. It was cloudy. That's just called reporting. Not easy to do well, but you get that done after you get that done. Level two is forecasting the weather it's gonna be star. It's going to be stormy. It's going to be dark. It's going to be sunny translation forecast P and L the third is influencing the weather. I'd go. As far as I say, changing the weather, it's going to be stormy six months from now. We can do X, Y, and Z and make it sunny that's data.  Casey: (14:06) The more data rich of businesses, the more complicated a business is the more power there is of influence there is to actually say, did you know that half our users are looking for this? So why don't we change our product to do that? You know, sounds easy, but those make all the difference in the world. Times a hundred of those. So the number one tool is business intelligence, which combines everything. It's not just about sitting on top of data. It's, not about a fancy system. It's putting it all together. And lastly, why is the CFO uniquely qualified or the office of the CFO? Most people work in a function, sales, marketing, engineering, their job is to focus and dedicate in one arena, the job of CFOs to tie it all together and help bring it all together. And then there's obviously, you know, other functions like that too. But when you have finance, that's a lot of data as well. People forget that accounting is a crap, ton of valuable data of all sorts. So the combination of accounting, data, forecasting data, customer data, sales data, product data is I think going to be the future. And it's gonna sit somewhere around the CFO space, obviously CEO space as well.  Adam: (15:18) So as I think that's great, those tools sound very clear for the youth, for the CFO, as they're looking at that, you know, as we wrap up our conversation, I think, you know, I wanted to ask you, because I know that you're in a number of different ventures. Are there other opportunities out there for CFOs to connect with other CFOs, so that they can help, you know, build themselves up and just really, you know, get the knowledge needed at a time?  Casey: (15:44) I mean, selfishly, the answer is the best one I know is called operator Guild. like co-founder did, like I said, as an innocent solved problem, I had about eight, nine years ago. It's a wonderful community and it's a great way to give back mentor mentee. So operators Guild is, is the place, in my opinion, for the most value of getting support, giving it learning, giving, and participating.  Closing: (16:13) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org

Contact Tamara: https://www.linkedin.com/in/innovationtamaraghandourWhat is your innovation type: https://www.gotolaunchstreet.com/innovation-training-programs/whats-your-innovation-type/Full Episode Transcript:Adam: (00:05)Welcome to the Count Me In podcast. I'm your host, Adam Larson. And my guest today is Tamara Ghandour, a leader in the field of human-centric innovation and its pivotal role in helping individuals and businesses create breakthrough outcomes. Tomorrow is the president of launch street, the founder of everyday innovator's tribe, the host of her own podcast and the author of the book. Innovation is everybody's business. She is also the creator of the innovation quotient edge, a powerful tool for determining your unique innovation style. This was a really insightful conversation with great tips for unleashing your innovation potential. So here without further ado is my talk with Tamara Ghandour. So Tamara, thank you so much for coming on the podcast today. I'm really excited to have you on, and as we talk about innovation today, I wanted to kind of focus in a little bit. so you talk about how innovation is, how you win against the winds of change. So maybe we can start off by talking a little bit more about that.Tamara: (01:08)Yeah, Adam, I think first of all, thank you for having me. I think that's a great place to start because it sets the stage for why innovation is so important and how we can leverage it in ourselves to add value and to contribute and to carbon niche out for ourselves. So here's the thing and I I'm sure we can do a whole podcast on everything that's going on, but let me just kind of sum up the winds of change for us. And the reality of the world that we're in. So, you know, we've got COVID which accelerated everything. So we'll just leave that as the blanket statement, but on top of that, right, we've got AI and technology taking over a lot of the base jobs. A lot of the functions that we have been known to do as humans in our roles, things that we're used to doing, but AI and technology can now do a lot of that.Tamara: (01:50)So we've got that happening. We've got web 3.0 in the metaverse coming and kind of how that's going to change everything. I just heard about a project where healthcare going on to the metaverse like, it's incredible, what's happening over there. And then on top of that, right, you've got decentralized finance, you've got the great resignation of where is everybody and why can't I find people to hire or keep people, right? You've got that going on as a wind of change. And then we've got a lot of uncertainty with global politics and just the state of the world. So I say all that, and it sounds like a lot of doom and gloom, but let me focus in on where I think actually it adds to a lot of, opportunity, you know, when times are stable, it breeds efficiency, but it also breeds complacency when times are unstable.Tamara: (02:35)Like we're in now, it breeds resilience. We've seen a lot of that from all of us in the past couple of years, but also innovation, a chance to change and to innovate. And you know, the thing about being an innovator that I think is so important right now is when you look at all of that, particularly AI and technology, that's doing the baseline of our job. What that actually means. If you look at it in the right way, is that we have the opportunity to do something that is uniquely human, which is that creative problem solving that empathy, that innovation, that strategic thinking. So we actually have the ability right now, more so than ever with everything going on to actually bring those insights, to bring that innovative mind to the table and be that strategic voice that our clients, our leaders, our teams, our customers, that they all need right now. So the uncertainties crazy on one hand yet on the other hand, the winds of change is what allow us to innovate and shift and change and do things in a way that's, that's different and unique to us.Adam: (03:37)Hmm. So, you know, you have this concept that you talk about a, bit as about an everyday innovator. So we're talking about innovation with the winds of change. What is that everyday innovator style. And why does it matter when we're trying to have these, when we're trying to sail the winds of change, if you will, Tamara: (03:54)I like the way you said that I'm going to sail the winds. That's a great way to say that. So every day, and being an everyday innovator is so important, but let me kind of back up as to why oftentimes with innovation, we buy into these myths and I see this all the time. I've been in business for 25 years now. And you know, we think it's Suzie down the hall with a purple streak or the Elon Musk and the Steve jobs and the JK Rowling's and maybe the Oprahs of the world, right? Like they're bestowed with something that we don't have, or we think it's for certain times, like the 3:00 PM brainstorm with the SCED markers and the blank eel pads, right. But every other time, just keep your head down and do your job. Or we think that it is, for certain departments, right?Tamara: (04:34)Marketing R and D or certain industries, technologies Silicon valley. But that actually is a sliver of what it means to be an innovator. And what I really come to see in my years of experience is that the best innovation comes from the places where you least expect, right? The everyday innovators who are out there rolling up their sleeves, doing their jobs, the best innovation is small. It's big, but it is inside all of us. And, you know, I used to believe that a little bit of those myths too, but we did a lot of research. We dug into the neuroscience and to change principles. And what we actually found out in our research is that we all have the ability to innovate. So we all have the structures in it, right? Neuroscience shows that it's a whole brain experience that MRIs light up when people create a problem, solve strategic thinking, you know, think differently.Tamara: (05:21)and our brains are flexible. We can actually get stronger. It's called neuroplasticity, but the way that all comes together and why it's so important is that Adam is you and me in the roles that we do when we bring innovation to the table and what we have right in front of us, we can get incredible impact. We can create those breakthrough outcomes. So, you know, innovation being siloed, just sabotages it for all of us. When we, as everyday innovators, when we understand that about ourselves, when we unleash that about ourselves, that's where we start to see the value and the difference. And we see it in individuals, leaders, and in teams and how they perform as well. It's why we built the assessment to tell people how they innovate, because we wanted people to say, oh, this is how I innovate. Cause I don't know about you, Adam, but I got pretty tired of hearing people go, you need to innovate.Tamara: (06:08)And I was like, how? And then I would try to do it the way you did it, but it didn't work for me because you do it in a way that's different than the way I do it. So understanding your everyday innovator style allows you to tap into what's actually already inside of you. All we're asking you to do is amplify what you're already incredible out. Maybe you're not using it. Maybe you've been trained out of it, but you know what? It's a lot easier for me to tomorrow to innovate in the way I innovate then Adam, to try to do you and vice versa. So that's why it's important.Adam: (06:38)That makes sense. Now you've said, you've said that anybody can be an innovator and a lot of times you'll get a book by like a Josh Linkner and you're like, wow, look at all this great innovation that I can do, but you may not be able to apply it exactly how you've seen somebody write it out. Are there other like sabotages to innovation within a team organization? What are some things thatt you you've seen that kind of prohibit people from becoming that innovator?Tamara: (07:05)Yeah. So, and I, Josh is great by the way, but I, but I will tell you, you know, I, I take issue with a lot of the innovation experts out there because I think they give us these big lofty processes and culture things. And the rest of us are like, I can't give my people 20% to do nothing. I I can't do, you know, a kombucha bar I can't, you know, to, for people to collaborate. So it that's the part that like, I could go on a whole soap box about that, but I think innovation should be accessible like in the moment. And it should be something that we all get to do. So when I look at teams, I work with a lot of them and there's a couple things that really sabotage innovation inside a team or inside any organization.Tamara: (07:45)So one of them is that 3:00 PM brainstorm with the SCED markers I talked about because what we're then doing is telling our people, Hey, guess what? I only want you to innovate for one hour in this week and that's at a 3:00 PM brainstorm, but for all the other hours you're working, just keep your head down. And what we're doing is we're actually minimizing innovation in all the times where actually we would have the ideas where it would make an impact. And then we shuffle into the brainstorm and we're cold and it's, you know, it's dormant and we haven't used it in a while. So that's number one is thinking that innovation has to be this one hour, you know, a week, a month kind of thing. When it really should be something we're doing all the time. Just number one. The second big thing is, and I know, because I have been guilty of this.Tamara: (08:31)I'm just going to own it early in my career is we reward outcomes, not behaviors. So let me just share a quick story with you. I'm leading a team of about 12 we're all in innovation. Funny enough, right? We're consultants, we're working with big companies like Proctor and gamble, general mills Clorox. And one of the things I used to love to do as a VP is get input from everybody in the organization about challenges. I would try, I was trying to solve. Now, this is pre like everybody's online all the time. So I would put up no joke, an easel pad on the wall. And in the middle of the circle, I would put this like, here's the challenge I'm trying to figure out. We need new revenue streams for X, Y, Z. We can't figure out this challenge on this client, whatever it was.Tamara: (09:10)And I would ask for people to submit sticky notes. And what I noticed is that I was getting these great sticky notes from three of the 12 people over and over again. Right. And I thought to myself, love it. But what I need is from everybody, right? I need all the perspectives to come together to solve this challenge. And I wasn't getting it. So instead of rewarding the outcome, the ideas those people gave me, I went down to Starbucks, I got a bunch of coffee gift cards. I came back up to the office. It's an open floor plan. I walked in and I said, as loud as I could to one of the people that had submitted ideas, I said, Hey, Adam, I want to thank you for submitting ideas. I haven't looked at 'em. I don't even know what they are, but I want to reward you for taking the time and the effort and the thoughtfulness to give me your ideas, handed them a gift card.Tamara: (09:56)Everybody heard it. And guess what happened by the end of the day, I had sticky notes from everybody, right? And I was handing out gift cards. I needed more all over the place. But my point is, the mistake that we make is we wait for the successor, failure to reward or punish. If we want to drive innovation in a team, we need to reward behaviors, not outcomes. If we reward taking risks, giving feedback, collaboration, going outta your way to wow, a customer, whatever it is that you want to reward, we'll get more of that. And that will drive innovation innately. When we wait for outcome, you know what it is. I think of it as Russian roulette, it's like black or red and you don't know which one's going to land on. You could do all the right things and still fail. You could do all the right wrong things and still succeed. So when we wait for that, it's like telling our team, we want them to play Russian roulette and nobody wants to play that at work.Adam: (10:49)No it, so it sounds like what you're saying is you have to be proactive. If you want to build a team of high performing innovators, you have to be proactive as opposed to reacting to whatever's going on. Am I understanding that correctly?Tamara: (11:01)Yeah. I, you know what? I think that's a great, a great lens on it. I think you need to be proactive and intentional in building innovation into your culture. And I'm just going to add a little bit to that. I think it has to start from the human side. So this kind of goes to the last mistake I would say is oftentimes, and this is when our phone starts to ring too, as clients call us and they say, all right, I implemented design thinking. I implemented fill in the blank process and my people aren't doing it and it's not working. And you know, is it the process? Is it the like, is it, you know, the initiative? Well, first of all, we all have initiative fatigue. Nobody wants more initiative, but second, you know, you need to take a step back, right? We need to get the humans on our team to understand how they innovate and how they contribute.Tamara: (11:49)And if we start being proactive about how you and I, and everybody on the team has these different styles of innovation and understanding how we can be innovative, then the culture and the process kind of naturally fall out from there of what you should do. It's not that the process is bad. It's just that the people aren't bought in. And we just did this whole thing with a team. I loved it so much instead of a title and job responsibility map. And you know how you see like a hierarchy of a company. We did a contribution map where we mapped out how everybody innovates and how that innovation contributes to the greater change this company was trying to make. And I guarantee you, after that, it was incredible how high performing and how innovative and some of the solutions that came out of this team. It's because we needed to back up and to say, Hey, look, the process and the culture will come, but let's talk about the people first.Adam: (12:38)I really like that. You kind of gave everybody, Hey, everybody, this is the why, this is why we're here. Yeah. Let's continue on together. And this is where your value is. I that's, that would be really encouraging from an employee standpoint. I like that.Tamara: (12:51)Well, and imagine for a second, right, Adam, like let's say, I just did this with a team. It was everybody from the, morning receptionist to the CEO, the morning receptionist now. So she came to work and like loved her job, great person, but wasn't feeling connected, but it turns out, guess what? She's the first person the client sees when they come into the office. So she owns the brand to the outside world and her contributions are how she innovates on the spot to make those people who come in the office feel comfortable and welcome and living the values of the company. And she innovates on the spot all the time. Because guess where problems go wrong? Scheduling people are late. Clients are coming in, right? Like that is a mess up there, but she right understands now. And the VP understands how their leadership, how that contributes to the greater change. And, I think, especially not just vision, especially when we're trying to drive change, we're trying to figure out new paths. We're trying to carve out a new niche trust with AI and technology and changing customer needs and changing, employee needs. We gotta understand how we all contribute and how we all innovate.Adam: (13:57)So can can being an everyday innovator help reduce stress and minimize burnout. Because I know even just talking to teammates on our team, we're all saying, we're trying not to burnout. We're trying to make sure, especially going from like going from, all at home to hybrid, a lot of places are switching to hybrid and you're trying not to burn, but yet there seems to be more things on our to-do list than not on the to-do list. And I liked how you just said, you know, for the receptionist she's innovating every day as she does her daily tasks and does those things, and it's seen at a more practical application.Tamara: (14:31)Yeah. Well that's the beauty of innovation. Let me just say this real quick. And I want to answer your question about burnout cause it's so important. The way we define innovation at launch stream and this kind of, this is a curated definition that we've prayed over time working with clients so that it's something that's accessible and empowering to everybody is think differently about what's right in front of you to create an advantage. So think differently, right? A new perspective, create a problem solving on, the moments, problem solving, about what's right in front of you, right? Your job, your resources, your challenges, your opportunities, what you do, and then to create an advantage. And that advantage could be a better way to do something, a better client interaction, a new product in the market, whatever it is. So that's our definition. I just want to make sure I say that.Tamara: (15:10)And for those listening, I would take that definition to your teams. Cause I guarantee you, part of the burnout is confusion of like we need to innovate, but what does that even mean? So let me get to burnout real quick. because I feel you. And I think that the, I just actually got off a plane from Indianapolis. I was with a group of women in Autocare. So, auto after market, like everything from Jiffy lube to kind of manufacturing of tinted. And one of the things I heard loud and clear before I got there was we are burnt out. We're doing more with less, our everybody's got 10 more todos on their plate than ever before. And on top of that, right, we've got change and innovate. So not only are we doing more, but we have to do everything differently, which takes more energy, right?Tamara: (15:51)It takes more thought process. So let me tell, give you a few reasons why innovation helps with that. And then some really easy tips like daily tips to implement. So when we understand how we innovate and we tap that natural strength, here's what happens. We perform at our peak. We get into that state of flow more readily, meaning like good focused effort and work, right? We have more innovative solutions. So we're not banging our head against the brick wall. We see more solutions and opportunities that we missed before. so when you think about that for a second, think of it as innovation metabolism, when you dial it up, dial up your innovation, we'll say you spend five minutes in the morning doing an exercise that gets you into kind of more of an innovative mindset. And everybody has different ones depending on their styles that will benefit you all day long.Tamara: (16:39)So part of the burnout, part of what happens from burnout is we're on a hamster wheel and we can't figure out how to get off. So it's just like we're spinning and spinning and spinning. Right? And I could see you nodding on that. Like it, just is no fun to feel like you're solving the same problems and over and over again, you are just like losing your mind because your to-do list is now 10 pages long. Every time one thing comes off a hundred other things come on. That's how I feel. But when we drive innovation, I like to think of it as swimming sideways out of a rip tide. So instead of just swimming harder and swimming harder, which is what we're doing right now, right? We're all doing it. Innovation helps us swim out of the rip tide. So having an innovative, mind's going to help you figure out a solution.Tamara: (17:18)That's going to solve a lot of those things on your to list. It's going to help you manage your to-do list in a new way. It's going to help you get more joy and satisfaction because it taps the dopamine in your brain. The feel good chemicals. So innovation helps us with burnout because we get off the hamster wheel and that's part of what's keeping us in, exhaustion and it helps us figure out how do we do the things? How do we drive solutions that make everything easier? So let me give you two quick tips that help with burnout. One is, and I learned this from the book, the one thing, and I think it's it. Keller Williams, the guy that did Keller Williams, the paint company. I can't remember which one wrote it. So I apologize, but the book is great, but he talks about he, the way he picked his to-do list was what's the one thing by doing this makes all of the things easier or makes them go away.Tamara: (18:04)What an innovative way to look at your to-do list. So I look at it a little differently, but I love that as a premise, which is, what's the one thing, if I solved this would make these other problems or these other tasks go away. And if I solve this with some innovation and create some real breakthrough, right? These other things get easier for me and for my team. So the question I want everybody asking themselves is what's the one thing if I solve this makes everything else easier. Makes upper other problems go away. I think part of the reason we're burned out is we're stuck in the weeds. So we gotta give ourselves a chance to get up. I'm going to give you one other tip. And that is, I want people to take five to seven minutes between every task and every meeting. And here's why, because I know that sounds like Sacra.Tamara: (18:48)Like, but tomorrow I have so much to do. I need those five minutes for that email. I get it. But here's what happens. The brain needs five to seven minutes to complete one task, clear it outta your brain and go to the next. But what we do because we're so busy is we go from task to meeting, to task, to meeting. And here's what happens when we don't close out that stuff. We carry mental residue around. So by the end of the day, it is like 10 pounds of Play-Doh on our heads. And that is exhausting and leads to so much burnout. So what I, now, what my team does all the time is we always take five to seven minutes of meditation or movement. So no Netflix, no emails, no Instagram like no consuming stimulus, just five minutes. Like that's all it takes. But if you do that between things, you'll actually be more productive and more innovative in the things you're doing. And here's what we do. Here's our role ready for this? This is the easiest one. If you're a leader, every meeting ends at 20 after or 50 after, no matter what, because you feel the time you have, we don't need those extra 10 minutes. You need them to get that mental residue away and to avoid burnout and keep your energy up. I don't need them. I'm not going to get more out of you in those 10 minutes. So get it done and then give people the time. Those are my tips. Adam: (20:03)I love it. You're talking to a serial multitasker. My, colleagues are always like, yeah, Adam's probably already sent you the email. Like I'm always multitasking during meetings and I am a huge habitual. Like I go from one thing to another thing and I love that idea of stopping and letting your brain rest for a moment. Yeah,Tamara: (20:22)Just five minutes. And even if you in about five minutes, like take a breath. Right? I mean it's but, here's the thing. Do you find Adam? Cause I know I do. By the end of the, if I go from task to task meeting to meeting with like no break, like there's a little bit of a voice in the back of my head about the meeting I had three hours ago. That's still there and that email oh yeah. Is still in my head. Like even if I've completed the task, it just hasn't left me. Right. It's just in my brain swirling around taking up space. So by the time I get to my two o'clock meeting, I've got 10% to give that's it. So, you know, we always say like, you have to slow down to speed up and you know, to avoid burnout, like have people do less. That all sounds good. But the reality is that's not, that's, that's not something a lot of us can implement. So instead just allow people time to just turn off for a second and then turn it back on. But that turnoff moment will make a huge difference in how you feel.Adam: (21:17)So as we kind of, wrap up the conversation, this has been a wonderful conversation. I was, as you were talking about swimming out of the stream, as this is going upstream, it's kind of moving out of the stream. What I kind of saw was like to be a better innovator, to be a good innovator. You have to kind of change your perspective or you have to change your perspective and broaden it because that's the only way you can see it. Because even with the grass you're sitting among the weeds, it made me think of honey. I shrunk the kids, the little kids were down there and they saw the aunt as this massive thing. And the parents were almost stepping on them because they were so, but big. But until you change your perspective, you can't understand what somebody's going through. You can't understand what it's like and all and everything else. And so you have to change the perspective to get a new, a new look on what you need to do to be, to become that innovator.Tamara: (22:05)Yes, I a hundred percent agree. I love how you said that. And I'd say there there's two things that I would encourage people to do to really become an innovator. So obviously take the assessment cuz then you'll know how you innovate. There's all these different styles, but there's two things I would say, change your perspective and deepen your perspective. And here's what I mean by that change is exactly what you just said. Like, look at it from the perspective of that ant is huge instead of small, right? Look at it from a different angle. If you're in this seat at your job, look at it from your leader's perspective, your team's perspective, the client's perspective, the competitor's perspective is one of my favorites find a different perspective to look at it, ask disruptive questions that get you to new places. And what I mean by deepen is, we have a 10 day, especially when we are constantly stressed out, because we're constantly in fight ,flight or freeze, right?Tamara: (22:55)We're just, we're stressed out. So we stay on the surface. We stay in our primal brain and in order to find more innovation, we need to get past the primal and get it to our higher function. So we need to go deeper. So there's three words that we don't have time to go into the whole story, but let me just tell you this. I was presenting someone asked me a challenge question. I was panicked. I needed to like get my feedback under me. So I said to the person, well, that's an interesting question. Tell me more. And in saying those three words, tell me more. That person told me about their past experience, why they were asking this question, why they were skeptical, what they were hoping to get out of it, all the things they didn't ask or I didn't ask. And they didn't say we often jumped to solution too soon. So the next time someone presents an idea, asks you a question that you don't know the, oh, even if you know the answer to, in fact, especially when you know the answer, I want you to stop and just go, oh, that's interesting. Tell me more. And you'll find so much innovation in that depth of conversation that we're not getting. When we stay on the surface,Closing: (23:55)This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org

Connect with Kristen: http://bit.ly/ARDigesthttps://www.linkedin.com/in/kristendonnellyphd/Full Episode Transcript:Neha: (00:05) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host Neha Lagoo Ratnakar, and we are now starting episode 181 of our series. Today's guest is Dr. Kristen Donnelly. Kristen is a celebrated TEDx speaker and founder, and one of The Good Doctors of Abbey Research. Join Kristen and my co-host Adam, as they talk about her work as an empathy educator and how companies and leaders can become more inclusive. So keep listening as a handover with the mic to Adam.  Adam: (00:47) So Kristen, as we get started, I think it would be best for us to define some terms that our listeners may think they understand, but you know, they really may not. Things like diversity, oppression, equality, equity, tolerance, and privilege. These are all terms that we hear in the media a lot. And I think people, they think they understand what they mean, but maybe you can help us by level setting.  Kristen: (01:08) I would love to break that down. So in order to do that though, allow me to kind of set the stage a little bit if you wouldn't mind. Of course. So one of the first things to understand is that the world is set up for some people to be the default definition of human and all around the world, infrastructure, laws, education systems, inventions are all unless, you know, otherwise determined, honestly set up with the default idea that humans will be male. They'll be probably middle to upper middle class. They'll be fully able bodied. Most likely they're gonna be white. They're gonna be cisgendered. Which means that their gender identity matches the sex their body was born with. They're going to be heterosexual and their life goals are going to include things like a mortgage and a partnership and children. Generally, that's the default.  Kristen: (02:10) So when we make working hour laws, we assume that it's a man with a partner at home. When we make cell phones, the only hands that Apple ever tests cell phones on are male hands. When we talk about, you know, what we should pay people. When we talk about how quickly you can pay back your student loans. When we talk about lots of things, whether we realize it or not, we are assuming that the people we are talking about is that category I just defined. So anyway, in which you line up with any of those categories, if you're a male, if you're white, if you're able bodied, if you're middle to upper middle class, if your BMI is socially acceptable, if you're cisgendered, if you're heterosexual, generally, what that means is that you have privilege. Privilege means the system is designed to work for you because you were what they had in mind.  Kristen: (03:07) When they designed the system, there is no shame or judgment or moral imperative that comes with that. There is just, the system is designed to work for you. If you're thinking the, and you're like, that's not true, cuz blah, blah, blah. It's probably cuz you've never seen the system because the system is designed to work for you. So then where oppression comes in is any way in which you don't line up with those systems, the degrees of oppression and privilege vary from category to culture and everything else. The other important piece to understand in this conversation is the phrase, "intersectionality". Intersectionality is a term coined by Dr. Kimberly Crenshaw back in the 1980s, she's a legal scholar. And now she's known often for being one of the four thinkers in critical race theory, which is not what we are teaching children in school.  Kristen: (03:59) I will just simply say that here. It's I have a PhD in sociology and I didn't learn critical race theory. So I promise that fifth graders are learning something a little bit different, but Kimberly Crenshaw came up with intersectionality to acknowledge the fact that while all women are oppressed on some level black women experience oppression at a more significant level than white women do. And essentially what it has come to real mean as social scientists is that we are all a lot of things at once. I am not just a woman. You are not just a whatever you are. I am not just white. I am not just middle class. I'm not just educated. I am all of these things and they come together in very specific ways. It's kind of like the back of a cross stitch. We're all kind of, we're all just a lot of things to make up who we are in the front of the cross stitch.  Kristen: (04:49) Every society has different priorities in terms of which of those threads are privileged and not. I say all the time, like, you know, we, we can add in othering and normal as well for the phrases of privileged and oppressed. If you're normal in your society, you are privileged. If you are othered, you are oppressed in some way, but again, your mileage may vary. Degrees vary here. I have oppression as a woman, for sure. I don't have the same level of oppression in the United States as I would have in Saudi Arabia. But that doesn't mean that I don't have oppression in the US. So the, so there's that. So there's privilege there's intersection, there's othering, there's oppression. All of that. What I like to say is that meaning that everybody is all those things all at once. Actually means that we're all diverse creatures as it is.  Kristen: (05:45) So none of us are one thing which means that you can't create diversity within your organization or your family or your social circle because everyone is already diverse. What you need to do instead is create inclusivity. And inclusivity is the decision to let everybody show up on their own terms and not determine the shorthand for who they are. And we get that shorthand through using tolerance and tolerance is simply saying you are alive because I cannot kill you. That's it. Tolerance is drilling everybody down to the easiest, common denominator that we can see when we look at them and putting them in categories that are easy for us to interact with it denies people, their personhood and their complications. It allows us to say, well, I can't ever know that person, cuz they voted for someone different than me. I can't ever know that person because they're gay. I can't ever know that person because they're evil. And instead if we eliminate tolerance, which is one of my life missions and we understand that everybody's already a diverse person in front of you, you're diverse, I'm diverse. We're all diverse heyo. What we're actually trying is create inclusivity. Then we can have the hard conversations about how to do that. But let's eliminate the myth that tolerance gets us anywhere.  Adam: (07:12) Wow. So you've covered a lot of things and I wanted to kind of circle back to where you started, where you were talking about the ideal human, right? Mm-hmm, so if you don't meet that criteria, you become an other.  Kristen: (07:24) In some way.  Adam: (07:25) In some way, right? So a lot of times when we get separated and we try to find others who have been othered, who are othered like us and we come together because we wanna feel comfortable with somebody who's been othered as well.  Kristen: (07:37) Absolutely.  Adam: (07:38) But is that so bad that we do that?  Kristen: (07:41) No, if that's, if it's the end goal and you stay in that group, maybe.  Adam: (07:46) Okay.  Kristen: (07:46) Or if you all pretend that the only thing you are is that thing you got othered for. Then I think it gets limiting. That is a weird word. I like to talk about limiting more. So if so, let's say that you and I really bonded over the idea that we were both, let me pick something. That's kind of silly. We really, really loved brussels sprouts as kids. Kids don't love brussels sprouts. No, but let's say that Adam, you and I were super into brussels sprouts when we were little. And so they would serve brussels sprouts at the cafeteria and we would have to sit at our own little table because nobody else wanted to talk to us cuz nobody else wanted brussels sprouts. So if you and I only we ever talked about our love of brussels sprouts and all we ever were to each other was the only person, the other person that loved brussels sprouts. We'd be missing a lot.  Adam: (08:33) Yeah.  Kristen: (08:36) So instead we should use it. What is best practice of humanity if you were, is I say, okay Adam, I love brussels sprouts, but I am also chronically ill. I am also somebody who has seen what addiction looks like. I am also somebody who does all these things. So now you go through your life and you're like, so I had this friend in elementary school who really loved brussels sprouts. And through that bond, I learned from her what her experience was life being chronically ill. And now I see the world just a little bit through her eyes of what it must have been like to both love brussels sprouts and be chronically ill. And your world view gets bigger.  Adam: (09:20) Yeah.  Kristen: (09:21) You see the world in a different way because you and I took the time to take 30 seconds and talk about something beyond brussels sprouts  Adam: (09:30) And then circling back to inclusivity. Our table would be maybe other who would join in saying, Hey, you know what? I've never had a brussels sprout, but let me sit with the brussels sprout people and learn from them. And that kinda brings everybody together. And  Kristen: (09:43) We don't say we don't make the rules that like, okay, well, you know, what we really need at this table is we really need somebody who also loves brussels sprouts and carrots. And so I don't wanna talk to anybody who doesn't also love brussels sprouts and carrots and we just say, Hey humans, how do you wanna come here? Do you wanna come here? Because you don't know anything about brussels sprouts or even better. You hate brussels sprouts, but you're cool with sitting with us who love it.  Adam: (10:10) Yeah.  Kristen: (10:11) Cool. Let's all move forward from there. And you get to show up on your own terms still within the social contract, still within boundaries that we set you don't get to show up as an asshole.  Adam: (10:24) Yeah.  Kristen: (10:25) We have the right to kick you out if you're an asshole, we don't have the right to kick you out just because you like carrots or don't like carrots.  Adam: (10:33) So when we look at the term DE&I, you know, diversity, equity and inclusion, a lot of people think that the E is for equality, but it's equity and like, why is that? Like, what's the difference there?  Kristen: (10:45) That's a great question. I mean the most common answer you're gonna get is that baseball fence analogy, picture that everybody gives you. What I really love to do is equality is great. I'm a huge fan of equality. Equality just says everybody should have equal access to resources. Yeah. Done. Yay. The issue is we can't really stop there because the world is the world. And so what equity does is take history into account. It's a quality with context. So when we're talking in the United States about housing, for example, let's, let's talk about housing. There has always been some group of people in the United States who has been denied housing based on their race. Always. Since before there was a United States. As soon as white folks showed up on this land, we started denying housing to people based on their race. So if a conversation about equitable housing, doesn't include historical systemic oppression of people not getting house cuz of the color of their skin, what are we doing? We've gotta rewrite some systems to make things equal. Equity is saying, we've gotta do some extra work to get to equality. That essentially equality is the thing that we all want. We all want equal access to resources. That's Nirvana, that's utopia.  Adam: (12:06) Yeah.  Kristen: (12:07) But we don't just get there by holding hands and wishing we could get there. There's some stuff that's happened in the last 65,000 years of human history that we've got account for. In Northern Ireland, for example, which is where my husband is from and where my PhD is. The civil rights movements in Northern Ireland started over housings. Because if you were baptized Catholic in Northern Ireland, you either could not get a house. Or it was very, very difficult to. Priority was always given to those baptized Protestant. So Catholics in the city of Derry or London Derry, depending on your persuasion started protesting for housing rights. It was about a lot of other things, but fundamentally they wanted housing rights. So now when you look at the charter in Northern Ireland for government housing, you have to say how you were baptized because they wanna make sure that there's equity in there. A lot of the funding of the peace projects was put towards communities that had been notoriously under resourced because we're trying to eliminate the things that kept us different and that kept people from using the system to their advantage. Is it perfect? Absolutely not.  Adam: (13:20) Yeah.  Kristen: (13:21) Is it weird? Is it now hard for people who grew up in Northern Ireland or wanna move to Northern Ireland and government housing and have no baptismal status? Yeah, that's real hard. But in 1998, the main issue was this. And so we addressed this main issue, but part of equity is saying, okay, we addressed that. We're doing okay on that. But here this solution introduced all of these other so problems. So let's keep working. My issue with DE&I work is that people assume it is an end goal. That is achievable. It's not, it's a process we keep doing because every time we include one group of people or one category or one idea we're gonna find ones that we didn't because humans are complex tapestries of all of those threads.  Adam: (14:05) Yeah.  Kristen: (14:06) And so it's a continual journey, a continual process that we intentionally engage in towards allowing people to be their full human selves.  Adam: (14:17) That kind of makes me think circle back to when you were talking tolerance. When I asked you the first question and how you're saying that it, we need to get rid of it. This it's almost like you have to get rid of a tolerance to get to that equity and equality that you were just talking about.  Kristen: (14:35) I think so, because it allows us an out. Tolerance lets me say, we can coexist. I also hate the coexist bumper stickers don't get me started, but like we can coexist without knowing each other  Adam: (14:47) Mm-hmm  Kristen: (14:48) And my point is like, you know, for audio listeners, this is where I gesture wildly to the planet. That's what's gotten us here. Yeah. Where no one knows people who think differently than they do or even worse. And this is what I think is even more endemic is that we know people who think differently than we do, but we don't know they think differently than we do because we haven't done the work to be the person in that they disagree with.  Adam: (15:11) Yeah.  Kristen: (15:12) We just say, oh, the minute it's uncomfortable, we're gonna shut that conversation down. Or the minute someone disagrees with me, they are the enemy and I'm not gonna talk with them about it. And that's what's gotten us here. And so my, my contention is we're here and none of us are very happy with here, so if we want somewhere new, we've gotta try new things. And I think new is getting used to the idea that even people who drive you insane are humans. As much as we don't wanna talk about it right now, Vladimir Putin is a human Adolf Hitler was a human And we have to wrestle the person who voted for the candidate you did not is a human. That the bully that you have to deal with is a human. I am absolutely not saying be in toxic relationships. But I am saying we have to start with acknowledging that every person is a human being.  Adam: (16:16) That's not easy to do, especially if that human being is hurting you greatly.  Kristen: (16:20) 100%. It is. It's why I always joke. If somebody gives you five easy steps towards practicing empathy, like five easy steps, they are literally selling you something, like, because it's so, and like, sometimes we are the person that's selling you something, but it's really simple. It's really straightforward, but it's really hard.  Adam: (16:40) Mm-hmm.  Kristen: (16:41) Holding the humanity and the dignity and worth inherent in every human person in tension with, you know, they're factually wrong or they're being abusive or they're just being a dick. Many things can be true at once. They can be a person and also be a pain in your ass. Those things can be true. And this is kind of where we have to start talking about boundaries about like where, you know, but I'm a big believer in informed choice. And so eliminating tolerance and leaning towards inclusivity allows us to make an informed choice about the person. Okay. I don't, I'm not gonna do a relationship with, not them because they're black or they're gay, or they voted for the other guy. I'm not gonna do a relationship with them because they are a toxic person in my life.  Adam: (17:26) Mm-hmm.  Kristen: (17:27) And I'm gonna set that boundary. That's hard, it's work. And it's movable. We really like to categorize people and keep them in those boxes. It's safe for us biologically. And we love safety. Our brains are always averse to things that aren't safe, even us risk takers. There's something in your brain that's gonna try to keep you safe. But that doesn't mean it's not worth it. And doesn't mean it's not possible,  Adam: (17:50) It's like we, humans have been putting ourselves in categories for, you know, 65 million thousand years that humans have been around. Like we put ourselves in categories. So it's gonna take a long time to get ourselves out of that, to actually see each other as humans in a lot of ways.  Kristen: (18:06) For sure. And I don't think we have to, like, I'm not somebody who's like, okay, we have to eliminate all categories. No, no, no, no. There are like, there are categories. Like we gotta do it. What we need to realize is that people are always more than what they're presenting you with.  Adam: (18:17) Yes.  Kristen: (18:17) There are always many categories. So instead of putting somebody in, like I joke, I joked a couple weeks ago on a podcast that like, instead of seeing somebody as a box from Amazon, what you need to understand is that everybody is the shipping crate that all those boxes came in.  Adam: (18:31) Mm-hmm.  Kristen: (18:32) And that we're all, all of our things. And some of those things include a lot of trauma. That mean that we can't do relationship with this category of people. Yeah. I have a really hard time doing deep, intimate, personal relationship with, with people who, you know, there's a couple different categories of life that I'm just like, I can't do intimacy with you, but I can get a drink with you. I can work on a committee with you.  Adam: (19:01) Yeah.  Kristen: (19:02) I can acknowledge that you're a person and that you have the right to those opinions. Even though they damage me. It doesn't get us anywhere to demonize people because of their beliefs. It just doesn't.  Adam: (19:15) Hmm.  Kristen: (19:17) And I hear folks being like, well, that's really easy for her to say, cause she's this white lady and all this other stuff, I'm not, again saying it's easy. I'm just looking at human history and realizing some, some changes we might need to make.  Adam: (19:31) Yeah. So as we kind of wrap up the conversation, one of the things that I've heard you mention in your Ted talks, is to decenter our worldview. So maybe we can talk about what are some, what are some steps? Here you go. Some steps that you can take to decenter people's worldview and start listening to each other.  Kristen: (19:50) Gosh, there are so many, so let me say again, let me caveat this with two things. So first of all, please hear me say that you right now are doing a great job at being a human. It's real hard. It's real hard. And none of us actually get educated in how to human. We learn by doing, we learned by doing it together. And we, the, one of the worst things that happened is we got sold in that at some point we are done. You're never done, you're never finished. You're always a creature in motion. So picking an area to grow in doesn't mean that you were a failure or wrong or evil or something before, or that you were bad before. This is just the area in which you're growing now. So do what you can to relieve yourself of the guilt, of not knowing things and then pick a thing.  Kristen: (20:50) So decentering your worldview is a constant process, and I'm not saying decenter yourself because we need to be priority. But how we see the world doesn't necessarily need to be. The story I frequently tell is that in 2001, after the Atlanta terrorist attacks on the Asian spas, my best friend and business partner and I realized that we didn't really know a lot about the Asian American experience. Neither one of us was in deep personal relationship with an Asian American immigrant. We didn't really know a lot about it. And so we realized that that was an area in which we could grow. So I emailed a friend who was married, who was a white American, married to a Cambodian immigrant. And I said, Cheryl, like, where do I start? How do I know? What do I learn? You know? And she said, well, I'm sure you've seen the PBS documentary.  Kristen: (21:35) And I was like, mm, come again. And she was like, okay, start there. It's six hours for Americans. It's free until 2033. It is six hours of the six biggest Asian American immigrant groups and the story of how they came to America, how they assimilated, what, what we did to them as a nation, what it looks like. I learned about things like the Chinese exclusion act and the true impacts of Japanese internment camps and why there are so many like people from Thailand that do nails, all of these things were covered in this documentary and it took six hours of my life. And so now I can, as I'm going through the world and sitting back, it didn't make me feel done. I can't speak for the entire Asian American experience, but I learned what the phrase bamboo ceiling means. I learned a phrase I learned about the not your model minority movement.  Kristen: (22:35) And so now when I encounter, and when I hear about anti-Asian American hate crime, I have some context to put it in. Took six hours of my life. They're even shorter ones. If you don't know, if you are not in a close personal relationship with somebody who is physically disabled. I highly recommend the documentary Crip camp. It was nominated for academy award two years ago. It's the story of the Americans with disabilities movement. It tells you exactly what the ADA is and what it isn't. Because by the way, if you are an American with a mental health documented issue, you are protected by the ADA. Did you know that? I didn't.  Kristen: (23:13) So what it does, the ADA actually mean? That's an hour and 45 minutes of your life. And then you, you know, you diversify who you follow on social media. If you're on Instagram, make sure you're following like organizations that you don't really know a lot about. And just listen. There's lots of small ways. If you're a sports fan, oh my gosh. Find a sport that you know nothing about. One of the best ones I can recommend is, is hurling. H U R L I N G. It's an Irish sport that doesn't really happen off of Ireland or outside of the Irish diaspora, but it's the fastest land sport on the planet. Google hurling, watch some videos, get to know it, dive in and learn what Gaelic sports are.  Adam: (23:57) That's pretty amazing. I went into YouTube spiral once watching it so I can attest.  Kristen: (24:02) Oh my gosh. It's like my husband's mother played it. She played Camogie, which is the women's version of it. When she was growing up in her teenage years. And that's how I learned about it. If you love food, pals, let me tell you, that is such an easy way to learn about, about like, if you are in a fairly adventurous eater, find a restaurant of an ethnicity that you've never eaten head in, say, Hey, I've never eaten here. I don't know your food, but I really love these flavors. Can you bring me something? Get humble, admit that you don't know things, start asking questions and continue the process. It becomes a discipline in a way, and it becomes like knee-jerk, but it takes a lot of work at first to remember that how you do humanity is not the only way to do humanity and you can have a richer human experience by learning how others do human.  Outro: (24:57) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Jim: https://www.linkedin.com/in/jimrafferty1/Full Episode Transcript:Neha: (00:05) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host Neha Lagoo Ratnakar bringing you episode 180 of our series. In today's episode, our guest is Jim Rafferty. Jim is a marketing and communications consultant and the author of Leader by Accident. My cohost Mitch Roshong, and Jim Rafferty talk about how cultivating a gratitude mindset helps transform leaders and organizations in extraordinary ways. To hear more let's head over to the conversation now.  Mitch: (00:50) So Jim, in your opinion, what are the most common characteristics of, or needed attributes for effective leadership in today's business environment?  Jim: (01:00) You know, I think the first word that would jump to mind would be empathy and that's always a quality we've needed in leaders to be sure. I think we need it more than ever before here over these last couple of years as we've all really had to adapt on the fly to a lot of changing circumstances. And all of a sudden your concern as a business leader is, you know, not only what your employee, your team member is doing in the office, but now whether they're also trying to, you know, homeschool their kids and take care of the dogs or an aging parent or whatever, as they're trying to work from home and get stuff done. And I think that's called for an enormous amount of flexibility and empathy on the part of leaders in the business environment.  Mitch: (01:43) And now oftentimes leaders are looked to for direction, right? They are providing others with information that they will ultimately need to adapt to, but this flexibility and adaptability, agility really is starting to shift into the role of the leader. So, again, in your words, how, or why do leaders need to be even more adaptable today?  Jim: (02:10) I think the, the sort of 10,000 foot view of leadership and, you know, this predates the pandemic, but maybe the pandemic sort of accelerated it is, you know, however many years ago we wanna look, the leader was the boss and he, or she told you what to, and you did it. And if you didn't, then there were consequences. And I think, you know, in a lot of cases, hopefully it's become more of a two-way thing. So, you know, the leader is not only talking, but listening and, you know, involving and engaging the team members and getting that feedback that ultimately is gonna make it a better place. And it's become less of a, my way. I hope it's become less of a, my way or the highway sort of situation because, you know, the saying that's the same, you know, then or now I think is, you know, people join companies and they quit bosses and they will quit bosses.  Jim: (03:02) We've seen this in the great resignation here, you know, dating back to, I guess, you know, November we're really the biggest numbers, but, you know, when they feel like they're not being listened to when they feel like they're not being engaged and, you know, in this whole remote work setting, that's become even a bigger challenge because we, we lose is that face to face thing, we lose the nonverbals that we would get if somebody's sitting across a desk from us and it just, it takes a little extra work and to reach a little deeper into the empathy bucket, so to speak if you're a leader.  Mitch: (03:33) And, you know, once a leader adapts, right. And, you said it, empathy is something that has always been important, but it's more of that adapting and their style, their behaviors, everything you just mentioned. I think one of the most important traits that we discussed previously that I would really like to hear your perspective on a little bit deeper is the idea of gratitude. So from the leader's perspective, again, it's more often, I believe historically, it's the employees that are grateful and express gratitude for the opportunities that are given to them. But from the leader's perspective, what does gratitude really look like?  Jim: (04:15) Yeah, my book, Leader by Accident, I would say has three main themes. And one is about, you know, challenging yourself and getting out of your comfort zone. Two is about the, the language that we use as leaders and, you know, the impact that that can have on organizational culture. And three is this sense of gratitude that you bring up. And that was a recurring theme in the messages I gave to the young men of our boy scout troop in my five years as a scout master, because, you know, it's hard and we tend as a society to default to the other way, right? If you scroll through your social media feed or you look at anything political, right, it's this relentless stream of negativity that just seems to keep getting worse and worse and worse. So I think, you know, even setting leadership aside just as human beings is so important because it just, it just changes the way we go through our days and it takes a little work.  Mitch: (05:07) And now, you know, it's a, it's a quality that I think is most valuable when, you know, you mentioned everybody kind of buys into it, right? So in, in terms of gratitude, how do you get people to stop with that negativity, take the step back. How do you cascade this thought process or this feeling, this emotion down throughout the entire organization? So it's much more of a positive culture and workplace for everybody.  Jim: (05:38) I think being a leader in that sense is a lot like being a parent in that we can, and we do say things and teach lessons and tell people things and hope that the, you know, it will sink in and all but much more than that. They're going to observe what we do and how we comport ourselves and the way that we respond to things. And so if we want to display a sense of gratitude, you know, if we want our employees to display a sense of gratitude, we have to start by doing that ourselves. And a lot of that I think comes in the sense in the way that we respond to things. I mean, how do we respond when things go wrong? Are we the unflappable leader, or do we fly into immediately, you know, end of the world panic mode. And, you know, obviously the former is the preferred choice. If you're leading a team.  Mitch: (06:25) And now I, I kind of, you know, flip flopped some of the conversation that we were gonna have here. But now that we understand how things kind of get across the organization, we have that buy-in once there is this positive culture and ideally the leader is setting the tone. What are the benefits of a workplace that embraces gratitude? What are, what, what does that look like from a team perspective?  Jim: (06:52) I think that if we're cultivating a positive environment and gratitude certainly is a big part of that, you know, and sort of what we've already talked about a little bit in terms of, you know, we've adapted as leaders and we are engaging our team members and we're being positive, and they know that a ton of bricks isn't gonna come down on their head with every little mistake they made. In other words, that they are trusted, right. Then what happens typically is they start to do the things we say we want our employees to do, right. They start to think outside the box and they start to, you know, quote unquote, act like owners of the company and think about the bigger picture beyond their own little checklist of things they do. And they stop running to you, the manager or the leader to cross every T and dot every I, because you know, what they're doing is covering their own behind.  Jim: (07:41) So, you know, so they won't get in trouble for doing something wrong. I think just a whole world of possibilities open up when we empower our team and gratitude is a part of that. And, you know, again, it partly is modeling that behavior. And part of it, it's sort of, you know, having that discussion with them. I mean, we've all had the employee or the, you know, Facebook friend or the LinkedIn connection who just likes to complain about everything all the time. I have one, you know, every time he goes to a Starbucks, he feels compelled to do a post about how slow they were or how terrible the employees, whether something like that. And, you know, if you feed yourself that string of negativity, it's just self perpetuating. And especially if you're a leader, I think you have to be especially careful about that.  Mitch: (08:21) That's a great point. And you know, earlier in the conversation, you mentioned the different components of your book, and we're really focusing in on, on that last piece that you mentioned here in gratitude, but I do want to get your perspective, and hear your thoughts on some of the other pieces of the book before we move forward. Would you mind just sharing the title of the book and a little bit about it with our listeners? So they have an idea of what it is that we're talking about here.  Jim: (08:47) Sure. Thank you. The book is called Leader by Accident: Lessons in Leadership, Loss, and Life that was published in October by Morgan James Publishing, and essentially the two parts of the story or the Genesis of the book, I guess, I very suddenly became scout master of our son's boy scout troop some years ago when the current scout master and his entire family were murdered by their oldest son, which was every bit as horrible as it sounds. And it was just something that we didn't know if the troop would be able to recover from. And in that moment of uncertainty, they turned to me who had been a boy scout for all of about two weeks, who really had no outdoor skills to speak of any scouting experience. Didn't have a position in the troop and also part one of the book is sort of that big step outta my comfort zone into what is in the best of times, a pretty demanding volunteer job.  Jim: (09:41) And clearly this was not the best of times, probably the bigger point though, is that how those experiences over my five years as scout master really fueled the second step outta my comfort zone into entrepreneurship. I'm a marketing consultant now and have been for not quite a decade, pretty close, but you know, something I never would have done had I not challenged myself with that first step into the scout master role and some of the leadership challenges that, that entailed and some of the honestly physical challenges that entailed and some of our, you know, high adventure camping trips and things like that.  Mitch: (10:15) Thank you for sharing that story. And, you know, just the way you presented the sequence of events, essentially, and what that means. You know, it, it just goes to show the value of leadership and having those skills, those, that innate ability to respond and adapt, in all different circumstances as we were talking about earlier. But I, you know, I do wanna wrap up this conversation and get into a little bit more of the language that we use as leaders that you were just, you know, getting to it in terms of where it lays in the book, the language we use as leaders, how is that different than maybe the language that we use in our, you know, regular workplace. And if we are aspiring leaders, what is it about the language that we use that we should work on in order to be more respected and, and understood as we advance through our careers?  Jim: (11:12) The first thing I would say, and I say this, whenever I talk about this in a, you know, a keynote setting is when we is this word leader, we don't necessarily mean the boss, right? And I don't care if you're running an organization with 200 people, or if you're the new salesperson who started last week, somebody somewhere in your life right now is looking to you for leadership, whether it's your child, your aging parent, your spouse, or significant other, you know, we're all, maybe not all the time, but we're all leaders at moments in our lives. And the part about the language really involves a few stories. And I'll tell the shortest version of the, the shortest one here, just to sort of give you an idea, but one of my Scouts as a junior in high school, we were talking and I was asking him if he started to think about college majors, and we talked a little bit about that, and he said, Mr. Rafferty, what do you think I should do? And I said, well, I don't know, what do you like to do? What interests you? And we talked a little more and I promptly forgot the conversation had ever happened, cuz it was just, you know, small talk a year and a half later when reached the rank of Eagle scout, he sent me a very nice handwritten thank you note. And in that note, he recalled that conversation that I had forgotten. And he said that was the first time in his life that anyone had ever asked him what he wanted to do with his own life. He was 15, maybe not quite 16 years old at that point. And that was a real eyeopener for me. And sort of a little lesson in that, especially when we're in a situation when someone is looking to us for leadership, for guidance, you know, what we think is a throwaway comment, small talk, you know, a joke, whatever can be interpreted in very different ways.  Jim: (12:47) And sometimes as in this case, that was a good thing. But other times it cannot be. And I think especially in our current, you know, with remote work and just technology in general, so much of our communication happens by typing, right? And it's very easy for the intent of what we're trying to communicate to get lost. Like somebody may understand what we want done, but our tone, our intent gets lost in the shuffle. And it's very easy to wind up with team members who have their noses at a joint. And when that happens, you're the last one to know.  Mitch: (13:19) Again, a great point and I completely agree. It makes things a little bit more challenging for sure. And yet there is just so much opportunity to develop these skills and be aware of your surroundings and the tone that you could be portraying, whether it's your intent or not. So the language that we use is certainly something that I think all of our listeners should consider. As you said, you never know who's looking to you for a piece of leadership. So and now just as my last question to wrap up our conversation, thank you for everything you've shared so far. I'm just curious if you can give us a little bit of insight into how you anticipate the role of a leader, whoever that may be evolving even more in the future. What are some of the other things, characteristics, traits, knowledge, or experiences that they should possess as our business environment continues to progress with this hybrid workplace now and everything else that we have to consider, who is the leader of the future, in your opinion,  Jim: (14:25) When I look back on those experiences with the scout troop and by the way, the scout troop not only survived, but thrived, not thanks to me, but thanks to a really good team of leaders. We had other people in place to handle sort of the scout skills stuff and all that. But I think the thing that really made it work, my piece of it anyway, probably two things. And one was that I was not afraid to admit what, I didn't know. The Scouts knew that I was inexperienced at a lot of things and that a lot of times when they were doing something for the first time out on a camping trip, so was I, and that's gave me a bit more empathy, empathy maybe than a typical leader in, in that situation. So, you know, number one for me would be, don't be afraid to admit what you don't know and to ask for help, even from the people you're leading.  Jim: (15:17) And number two, I think one of the other things we obviously had a great deal of healing to do as a troop. And I made it a point to really try to get to know the young men of the troop as well as I could and understood, understand what they did when they were not being boy Scouts. You know, I knew what sports they played or what instrument they played or how they spent their, you know, what their hobbies were and that kind of thing. And we celebrated their achievements outside of scouting as a group, you know, and I think that's where we're going in business leadership. And, you know, in some cases we're already there, but especially again, in this remote work environment where now we've gotta account for the fact that we are trying to homeschool our kids, you know, that we're maybe ready to come back to the office now, but we're not sure if we can afford the gas at the moment, you know, that kind of thing, that, that sort of understanding the whole picture of who your team member is and being responsive to it and being empathetic to it, I think really is the future and in some ways the present of leadership,  Speaker 4: (16:20) This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Sammy: https://www.linkedin.com/in/sammycourtright/Full Episode Transcript:Neha: (00:05) Welcome back for episode 179 of our podcast series. This is your host Neha Lagoo Ratnakar, and you're once again listening to Count Me In, IMA's podcast about all things affecting the accounting and finance world. Today, you're going to hear from Sammy Courtwright, the co-founder of Ten Spot. Ten Spot is a workforce engagement platform helping companies enhance their work from home capabilities. Sammy joins us to talk about how technology has impacted today's work environment, what it means for our work life balance and what the future of the workforce looks like based on current trends. Keep listening as we head over to the conversation now.   Mitch: (00:56) So right before we started recording here, we were talking a little bit about how things have changed over the last couple years, and to kick off our conversation. I'd like to first ask how has technology impacted work being done at work?   Sammy: (01:10) Yeah, Mitch, I mean, what a change we were faced two years ago, right? Where suddenly we were thrown into remote or distributed work and technology, thank goodness was able to make that transition moderately seamless. Right? Of course there was always that idea of having to figure out which technology we're going to use. Does it work? Does everyone know how to use it? Is it effective? Now we have to buy more licenses, but it's definitely made this working from home or hybrid work significantly more streamlined collaborative, but it's also made it really constant, right? I feel like you're always on, which is a good thing and a bad thing for some people. I think at the beginning of the pandemic, when things were a little bit slower Netflix and all of those other subscription services, weren't pumping out the content as quickly. You might just check another email.   Sammy: (02:03) You might respond or start working on a project. And while that was great, I think now we've realized that we went too far, perhaps in one direction of always being on. And I think now people are being a little bit more clear or understanding of creating better boundaries with technology. So when am I on, how do I set myself up for success? Am I balancing that a little bit more? So technology definitely impacted the work that we're able to do from anywhere, not necessarily from your home. But it comes with some pros and cons.   Mitch: (02:38) Absolutely. And I think anybody listening can relate. So, you know, you mentioned balance here and I want to get into that work life balance because it is so easy to work remotely and through the different tablets and laptops and phones and everything, that's at our fingertips. So what are some of the things that people can do to really just shut off both, you know, work and technology so that we can really, you know, make strides towards this work life balance?   Sammy: (03:06) Sure. So I have found that I'm paying far more attention to my screen time. At least Apple has this function. I'm uncertain about other models, where it tells you how much time you're spending on your screen. Similarly, apps like Google have taken a further kind of dive into the calendar settings and has allowed you to take a look at your calendar and understand when there is focus time when there is shutoff time, when there is even on my phone, I've set up sleep time where it knows that I'm gonna be winding down to go to sleep at a certain hour. So it starts going into, to kind of shut off mode. I don't really access social media at that time, or it lets me know that, Hey, you're in sleep mode. You might not wanna be checking, you know, Instagram right before you go to bed.   Sammy: (03:49) It makes you a lot more aware. I don't think that I even really had that visibility or was aware of how much time I was spending either on my computer tablet or phone, but now that Apple, at least, and many other applications are really starting to focus on how much time you are spending using technology. I think it's helped me create a better boundary of switching off or not always being on. I really think awareness is kind of the key to this. So for people that are asking that like Hey I'm uncertain, you know, what to do to get started. I always recommend take a look at your calendar, take a look at your habits and your day, and just start jotting down things that you're doing. How much time are you spending on that specific project? How much time are you spending in front of the computer?   Sammy: (04:33) Are you getting up to get that glass of water or do you wait until, you know, that specific task is done before you reward yourself with getting up and, you know, getting that glass of water, those things make a really big difference. And they even say those 10 to 15 seconds, 30 seconds breaks that you can take to, you know, get up and go refresh your water or whatever it might be. Grab a cup of coffee, really recharges your brain and allows you to be more creative. So I think for those that are looking, you know, to maybe just get started and want to shut off or create more boundaries, start documenting what you're doing and how you're using technology and start creating a little bit more limits. What do you wanna do with that time instead? Is it, you wanna read a book? You wanna meditate more, you wanna go for a walk, you want to spend more time with your kids. You wanna play with your dog. I think for those moments, and you can even put them into your calendar, block out those moments have been really effective and helps people at least shut off, from both work and technology to kind of maintain that healthier work life balance.   Mitch: (05:37) You know, I use focus time throughout the week, you know, on my calendar and other thing, turning off the phone and sleep mode, all that stuff. The whoop band that I have tells me when to go to bed. So I know all right, it's time to shut everything else down, leave it alone. So there is, there are so many options available to us. Really you just have to seek them out and take advantage of 'em. I think, because it's so helpful, at least in my personal experiences, you know, but that's on the personal side of things. And obviously everybody has gotten relatively accustomed to a different kind of work life balance. And as they adjust to everything you are mentioning, you know, they are seeking new things I think from work, right. And we're seeing a lot happening in the workforce today. So my next question for you is kind of taking it back to business a little bit, if you will. And from the employer's perspective, with the idea of work life balance in mind, how should these employers, how should these businesses really work to keep employees engaged and retain them? You know, like I said, with everything else going on today.   Sammy: (06:45) Yeah. I always think the first step is to acknowledge it. I think employers are now realizing that employees are not just employees anymore, that they're people with lives outside of work. And in reality, I know that this has always been the case, but anyone who has been on a zoom call in the last like 18 months now, we all know a lot more about their dogs, their cats, their kids, their partners, their parents. We know so much more about our colleagues and coworkers lives. I really think this blurred line of work and life encouraged employees to expect their companies to consider and acknowledge their whole selves and all of these roles that we play outside of work, whether that's parenthood or caring for an aging parent or pursuing a passion like playing in a band or taking a yoga teacher training class get an advanced degree, you know, whatever it might be.   Sammy: (07:43) I think that there's a lot more acknowledgement that there is more than just work Sammy showing up every day. I have all of these other roles and responsibilities that I play and employers have to acknowledge that and recognize that to keep employees engaged. I also really think like this idea or approach to like 360 degree wellness, mental, physical, social, flexibility with work hours. I think employers really need to start. And I, and I see a lot of companies moving this direction, but stop offering these blanket benefits or these one size fits all approach. I really think that employees today, no matter what their age is have come to desire, you know, a range of health and wellness benefits that are really robust and could greatly impact their lives. I think companies now are offering more of a marketplace approach or a stipend, so it can be used for whatever you deem to be wellness. And I think that kind of expands the availability of the service, the access to the service, and it's really customized to what the employees need at that time. And I think that's another really great way to keep employees engaged and retained at work.   Mitch: (09:01) You know, it's so true. I was actually just talking to somebody, a friend of mine started a new job and he was telling me about the different incentives that come with the new job and at the company, things like a barber shop in the office and somebody coming in once a week, you know, things that handling a stipend for dry cleaning. So you can, you know, keep up with your work attire when you have to come to the office. I called them practical incentives, right. Things that people do. And I think that's so helpful, but I know you have some more ideas in this space and, and, you know, there are fun classes and things that employers can do to keep their employees engaged, but if perks and remote work and you know, some of these other practical incentives aren't enough, what else can be done? Because I think that's another trend. You know, what else, or, you know, how much more can I get is kind of a theme. So what else can these employers do for their employees?   Sammy: (09:58) Sure. There's a couple of things I wanna hit on. I think training is in, you know, professional development is one of them also building a sense of community in the workplace, especially when employees are working remotely. I really think younger workers specifically, you know, Gen Z are relying on the workplace to provide them with opportunities for socialization. We recently ran a survey and we learned that 62% of gen Z workers are really enthusiastic about the positive impact virtual events have had on their company. So these virtual events could be anything from a company wide trivia night, a scavenger hunt, a team wide scavenger hunt, a cocktail crafting class. These really fun and unique events are opportunities that aren't focused on work, per se. Sure. This isn't like, you know, brainstorming session for the next project that you're working on, but it's opportunity for socialization it's opportunity for building that sense of community.   Sammy: (11:02) That is kind of outside of these perks and benefits that we were discussing previously that is really important to creating a cohesive and synced team. And I really think, you know, because of this work home transition, the number of individuals that have really relied on work, providing them those opportunities has really increased. So I'm gonna put heavy weight on building a sense of community. And then let's kind of touch on training because I mentioned that or professional development, there was this report in 2018 that just like blew my mind. 59% of managers had never had any training on how to manage people. Now this is 2018 when this data came out. Now imagine with the pandemic, you are potentially starting at a new company and you're promoted as a manager. And you're like, oh my gosh, this is so exciting. I'm gonna get a title change and potentially, you know, a salary increase and I'm responsible for people.   Sammy: (12:01) And that's, what an incredible accomplishment. Then you sit back and think, hold on, my whole team is remote. I haven't really managed distributed teams before. How do I connect with them? How do I build that sense of community? How do I make sure that they're getting, you know, feedback on career development and whatever else it might be. And that's a really big issue that managers are facing today, and it's not just managers professional development in general. So I really think that training professional development courses that can be done on individuals own time to really help advance their career might be that extra edge. If those perks and remote work aren't enough to really keep employees engaged at work,   Mitch: (12:45) It is amazing. And there's so much data out there now about who's changing jobs and the responsibilities like you just mentioned, and, you know, everything is exponentially increasing at this point. It's great opportunity. It leaves a lot of gaps as well. And I think you hit it. It's all about training and making sure that everybody on your team is up to speed with the needs and everything's aligned with the organization, you know, but I wanna talk a little bit more about that as people are transitioning from job to job and move up in their careers and such, there is something to be said for continuity. I think so as far as managers and manager training and keeping individuals in place or, or really qualified, what can organizations and, or, you know, managers of managers do to kind of combat this trend and really try to build this team up find this continuity and continue moving forward as a group, you know, as opposed to leaving and hiring new individuals.   Sammy: (13:44) Sure. Yeah. Look, I think there are good managers. There are great managers. And then unfortunately there are managers who make you wanna quit your job. And in the same survey that we ran, we learned that 46% of workers say that they currently have a manager or a team lead that makes them wanna quit their job. So for companies that are already kind of struggling with retention, this isn't fantastic news. And it's interesting to think about because you know, when employees are burned out, they turn to their managers for help. But when managers are burned out, who are they supposed to turn to? I really think training managers on how to be effective remote leaders is really important. And as I mentioned earlier, I think so many people have kind of been promoted throughout the pandemic or have stepped into new roles and responsibilities that they've never had before.   Sammy: (14:36) And they're expected to manage a team remotely. And there just hasn't been training available for that. And it's kind of bonkers. So I think focusing on this management training will really reduce attrition, not only for the individuals being managed by set manager, but also for the managers themselves. There's nothing worse than feeling like you are not set up for success. It's all well and good that you've been moved into this role or that you're managing individuals for the first time. And you think, wow, what a career opportunity. But then you look back and you're like, wait, I haven't been set up for success for this role. I don't actually know how to effectively lead these teams. I don't actually know what's required of me. I know that employees have all these expectations or my team has all of these expectations of me, but how do I execute on that? Who's going to help either mentor me or provide me with the resources so I can actually be successful in this role. So I think manager training will really combat this, these concerns and put managers in a fantastic position to really succeed and nail, you know, their position, whether they be remote hybrid in office, all of the above.   Mitch: (15:46) All right. So I wanna wrap up this conversation, but I do have somewhat of a loaded question for you. I know we were again, before we started recording, we were talking about it's, you know, it's time to be proactive. Let's start looking in the future. Let's not reflect so much on what's been happening in the past. So with that idea in mind, I want to get your thoughts on what the future of our workforce looks like. Because of all these trends, everything we've talked about. So for, but now let's take it into the future. What can we expect? What should people be doing? You know, please share your thoughts on, on what is to come for this workforce.   Sammy: (16:22) Great question. And these are just my thoughts based on trends that I've seen and conversations I've been having. I think we can all safely say that the option to be remote or fully remote will be the norm. I think that this is not going anywhere, but I am really intrigued by the freelance space. And this is either that you are a freelance worker or that you work for a company, but you potentially could work for multiple companies at once. I don't know about you Mitch, but I have several friends that are actually running a couple or three full-time jobs at once. And it's pretty incredible. I know it's already happening now, but I really think that this will become a common practice and a kind of less taboo right now. They're doing it, you know, moonlighting or under the radar.   Sammy: (17:10) But I think in the future, it might just be like, Hey, here's great talent. How could we attach this great talent to multiple projects across different companies and to kind of, you know, use them for a specific amount of time and they, you know, obviously get paid for their work, but then they can also get exposure to different companies, handle different projects or challenges. I think the freelance world will get really interesting very soon. Also I think I mentioned this earlier, but being really customized with the employee experience and that's from like hiring through to retiring. I really think AI is gonna play a major role in how you know, employees are going to shape their careers. I also think, you know, Gen Z, I talked about them earlier. I think they're gonna really have a significant impact on today's workplace. And you know, how we think about technology and company culture and world issues specifically also workplace issues like discrimination and diversity, equity, and inclusion, how companies deal with a lot of these workplace and pressing social and political issues. I also think, you know, we might, we talked about this earlier. Maybe there'll be a toe dipped in the four day work week or something a little bit more flexible. The idea that you get work done when you work best. And you know, companies will kind of begin to ebb and flow with that.   Speaker 4: (18:34) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Will: https://www.linkedin.com/in/williampeng/ Full Episode Transcript:Neha: (00:05) Welcome back for another episode of Count Me In. I'm your host Neha Lagoo Ratnakar. And this is IMA's podcast talking about all things that affect the accounting and finance world. Our featured guest for today is the CEO and co-founder at Northstar, Will Peng. Will co-founded Northstar, a financial wellness and benefits platform because of his inspiration by the positive change FinTech can have on people's lives. He set out to solve the inequality of our financial guidance and shares his insights with us as he discusses the inclusive and equitable support employees can receive from FinTech related apps and products. To hear more about how FinTech can improve financial stability, keep listening as we head over to the conversation now.   Mitch: (01:02) So Will, I know your history, right? That kind of led you into this FinTech space and a lot of what you do is about financial guidance. So what I would like to first start off our conversation with is asking you how will emerging FinTech really help solve some of these financial problems that a lot of individuals are facing today?   Will: (01:23) Yeah, this, this is a really interesting question because of my background. I started my career as a product designer. So thinking about the ways that behavioral psychology influences or limits people from making change with their finances, but also my time as a venture capitalist, investing in startups, a lot of FinTech startups seeing the new technology that enables us to solve a lot of these classic problems I've been around for, for a long time. And first and foremost, I think what's most exciting that technology can actually influence personal finances is the idea of financial accessibility. So who has access to financial advisors, financial best practices and for the longest time, financial advice has been mostly limited to people who already have money, people who are wealthy already. And if you look at this from first principles, the underlying reason is that the ways in which we deliver financial advice, and this is pretty broad definition, right?   Will: (02:29) Financial advice can be financial planning. It can be tax advice. It could be investment advice. The ways that we have delivered this advice have primarily been a hundred percent human driven. And when advice is human driven, you're limited kind of by the number of hours in the day, you can do the math pretty simply you have maybe a 40 hour work week. And if you're a financial planner, you have 60 to 90 minute sessions, and pretty quickly you realize that you need to charge a certain floor for your hourly rate. If you're a fee only financial advisor, and then you also see new business models around non fee only advisors who take commissions who referral fees and asset management fees. And that's a set for topic that we can talk about.   Will: (03:24) But I'm generally a proponent of fee only models because it most closely aligns the advisor with the client. But so, so if you think about financial accessibility from that perspective it's really exciting to think about the ways that technology can more scalably deliver advice both in the creation of the plans, as well as the delivery of the plans. And once you do that, you actually lower the floor of what you need to charge in order to stay in business. And so you kind of see this in, for example, the robo advisor world low cost index funds have been around for a while. But the emergence of robo advisors has been a really interesting development because now anybody can connect, get access to low cost index funds with a great user experience and, and invest with, with low minimums and this all came about because of technology. And so that market is relatively mature now I dunno if you saw recently that UBS acquired wealth front so really interesting thing about not only that specific vertical, but across all different verticals, what are the ways in which technology is making personal finances more accessible?   Mitch: (04:43) Yeah, it's really interesting because, you know, as we talk about making things more accessible and, you know, you mentioned a lot of the opportunities presented by technology for private finance and, you know, obviously many of our listeners, more the corporate finance, but still technology enabling a little bit more foresight and, and, you know, more data available, another theme in line with technology and kind of the profession. And also what you're doing here is making some of these resources essentially more inclusive and equitable, right? So you talked a little bit about kind of lowering that floor, but far as employees, you know, specifically in the workforce, how is this you know, equitable and inclusive relate to technology?   Will: (05:31) Yeah. So well, this is I'm glad you asked this question because this is a big part of what we do here at NorthStar. And we have this saying that financial wellness starts at work, and it's this fundamental idea that especially in the US, so much of our not only financial lives, but also our whole lives center around work. And what I mean by that is that work is the primary source of wealth creation for the majority of people. You get your salary, your retirement accounts, but you also get your health insurance plans through work. This whole idea of employer sponsored plans and a whole set of perks. If you work at a tech company, for example, you get equity compensation, and that's oftentimes really difficult to understand. So there's an education gap not only for equity, but just for personal finances in general.   Will: (06:18) And if you look at it from a macro perspective, we've really shifted away from defined benefit pension plans where my father still has a pension plan and so hopefully he can retire soon and he'll get a kind of predefined payout, but we you've moved into a world of defined contribution plans like 401k plans and HSAs and FSAs and the variety of things that you'd get from your employer have increased. Whereas your total compensation package was relatively simple in the past. Now it's really complicated. And our education system around finances and the support systems through to help people make the best decisions, best financial decisions have not caught up. And it's an unreasonable expectation that employees individuals know how to choose the right retirement plan or figure out how much you should put into your retirement plan each month, or how to use an HSA or how what's the best health insurance plan for me.   Will: (07:27) I think the what's been really interesting to see the rhetoric around policy has been around the idea of choice where if you remember from the healthcare reform debates there is this idea of choice and it's true that the HSAs are incredibly powerful. They have what's called triple tax savings that most people don't know about. But it requires back to the point I made earlier about behavioral psychology, because it is so complex. Most people don't utilize them. And so even though it's a powerful option, most people don't use it, which means that the choice is a double-edged sword. So you need to, you need to pair choice with education and advice on how to best utilize these new tools. So I think there's a really interesting responsibility that employers have today to not only give people the tools, but also the advice to make those best decisions for themselves.   Mitch: (08:34) And let's, you know, continue on this topic and the conversation you have going here as far as, you know, the education and working towards change, how does this technology ultimately work towards changing financial stability across the country? I know you mentioned, you know, really the United States being, you know, one main focus area, but whether it's domestically or globally, you know, how does this work towards more stability across you know, all individuals?   Will: (09:05) Yeah. So if you look at the statistics around kind of where Americans personal finances are you find that doing nothing is doing something and whether it be around savings rates or retirement contribution rates or the amount of debt that people are in. The reality is that if you don't provide employees with education, they just most of the time do nothing. So this is because is if you face, if somebody's faced with a ton of different choices, complex choices, and this is my personal story, actually, when I graduated from college was I had a ton of student debt. I had a retirement plan. I had equity through work. I had to choose health insurance. I needed to save for the first time all while living in New York City. And it was just so overwhelming. And as an immigrant, I just didn't have anybody to turn to either my parents didn't know what to do.   Will: (10:05) So I just did nothing. And I was automatically enrolled in a 30 year payment plan on my student loans, which was designed to squeeze as much interest out of me as possible. Didn't really save that much, didn't enroll in my 401k plan. And so the reality is that that there's this default state where if you don't do anything, you're actually making a decision that's not in your own best interests. So it's, it's really important to provide not only the education around what these different tools are, but also giving them access to financial advisors, as well as new kind of FinTech apps to kind of break through that behavioral psychology of not doing anything with your personal finances.   Mitch: (10:53) It's interesting because I was in a very similar situation coming outta school, not out a whole lot of guidance. It's just, here's the real world and figure it out. So it took a while until I actually did receive some education from, you know, individuals at work and, you know, some guidance as far as what I should be doing. And especially year over year as things change financially. So I imagine, you know, technology you mentioned some apps certainly probably accelerate the learning curve, I would assume, right. Enabling individuals to kind of learn and, and see some, you know, different benefits and such, you know, it is so mainstream at this point, but I would like to get your opinion on that learning curve and whether it's from the employers or the individuals educating themselves, how does FinTech and the technology relating to personal finance and different guidance like this? How does that look into the future? What do you expect as far as the gaps in financial stability across the country and, and whatever else, what can we expect in the future coming up from this space?   Will: (12:01) Yeah, there are a few really interesting trends here. I think underlying all of it is the emergence of new FinTech infrastructure. So infrastructure around consolidation of personal financial data across different institutions. So previously you're kind of locked in to one bank that you decide to bank with. And it's hard to get information from another bank, if you use one bank for your checking and saving then another one for investments. So consolidation of personal financial information, and ultimately with the goal that you can actually own your own financial information is really interesting to think about. And almost being able to use different point solutions across institutions as almost like a commodity. So I think that's super interesting and enables much more interesting FinTech apps. And the next step from that is the ability to actually take actions on your advice and kind of the two primary ways to do it.   Will: (13:06) The types of actions are moving money and opening and closing accounts. And we've talked about the importance and difficulty around behavioral psychology, of personal finances. It's like oftentimes eating, eating your vegetables, or it's really, it's really difficult for people to understand long term impact with their short work term decision making. So by making it as easy as possible to turn that advice into action, you can actually move money between bank accounts, if you have your checking at Bank of America, but your savings account is at Ally Bank you should be able to move money based on a certain schedule or intelligently based on how much you have in your checking account. you should be able to sweep that into different accounts automatically. So this idea of automating your finances is really interesting to think about, to pay off your loans, pay your bills, put money into an investment account.   Will: (14:12) That's a really exciting vision to think about. And the other is being able to open and close bank accounts or different products. So if your financial advisor recommends that you refinance your student debt and they give you a recommendation or a few different recommendations, it'll be amazing to be able to refinance that debt in a very seamless way instead of having to go and Google it and look up, which one's the best one and then file fill out the application. And another example of this is really exciting is what does the intersection of financial planning tax and investments look like? It never made sense to me why these three types of advice are kind of separate. You go find a CFP and who's helping with you with your financial plan, but then they say, okay, like, there's some tax question that you have related to equity compensation, but I'm not your tax advisor, go talk to your tax advisor.   Will: (15:11) And maybe I don't have one. And even if I did have one, how do you have this CFP and the CPA communicate so that they're they have a context from what I'm working on with them. And maybe I have a question about my employee health plans. Well, like my, my CFP doesn't have that information. So how do you, how do you pull that data in? So it's, it's the intersection of advice, but also data that's really interesting. And I think that's a big part of kind of where we're going as well, in addition to where the, where the industry is going to almost have, like, if you're familiar with the term, like the idea of a family office, family office is like the, the pinnacle of financial advice for wealthy people. And back to how we started this conversation, the reason why people don't have access to that is because it's a lot of manual work. And so of course, if you're a family office, you'll go after the most wealthy individuals and manage your assets, but how do you take the fundamental idea of combining all these different types of advice and make it available to everyone? I think that's a really exciting vision to, and future world to think about.   Mitch: (16:23) It's very interesting and it makes you think, you know, how have we come this far without solutions like that in place, but it's you know, great topic. I do have one last question, if I can before we wrap up here, you know, you were talking earlier about the employer's role in some education and, you know, some of the individual's role in personal growth, and just curious, based on, you know, today's workforce really, and, you know, we've all heard the great resignation and the freedom of choice and different options that employees are seeking for one reason or another. So all these different topics, it got me thinking, you know, how does this really, this idea of FinTech solving financial inequity really ultimately equate to businesses, being able to keep some of their top talent? Is there any correlation between an individual's personal finances and some of the issues they're facing with, you know, employers keeping some of these individuals in their workforce?   Will: (17:26) Sure. Yeah. It's a really great question and something that we're at the center of, and I'll caveat with everything that I say with the fact that the reasons that people stay at a company encompass more than just personal finances, you need to create a healthy culture, rewarding workplace, respectful to each other. Those are all requirements as well, but from a financial perspective, it's really interesting to think about the ways that people oftentimes look for a new job because they're not paid well enough. Or maybe they don't understand all of the range of benefits that they receive that have, maybe they're not, they don't have a fungible cash value, but they do have a significant impact on my livelihood and my ability to achieve my financial goals. So what we found is that by offering something like NorthStar that it's not just about having a call center of coaches is being able to work one-on-one with an advisor who understand let's take like specific example.   Will: (18:30) If somebody's looking to start a family, they'll go to their financial advisor who understands all their, their different needs, but also all the different benefits that the employer offers. So it's not just about setting a new budget or figuring out how much I need to save, but it's also about understanding that maybe you get fertility benefits and infertility benefits through work, or maybe you're on a high deductible health insurance plan. And you need to change to one that's a better support for parents and, and childbirth. So it's this really holistic approach to financial wellness that employers are really at the center of. And so we want to help people shift away from a world where they see a higher salary as the only way to achieve their financial goals and kind of providing a more holistic set of support beyond just a higher salary. So I think there's a really interesting shift that we're seeing with many employers to, to think about their or total rewards or compensation and benefits packages in this way, rather than just saying like, Hey, here's the salary, here's your retirement plans and health plans. And calling it a day,   Speaker 4: (19:41) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Connect with Dr. Lewis Full Transcript:Mitch: (00:05) Welcome back to Count Me In. IMA's podcast about all things affecting the accounting and finance world. I'm your host, Mitch Roshong, and you are listening to episode number 177 of our series. Today's conversation features Dr. Anton Lewis, an associate professor of accounting at Valparaiso University, whose research investigates the experience of black accountants in the profession and promotes equitable racial representation. In his conversation with my co-host Adam, Dr. Lewis talks about DE&I in accounting, common flaws relating to diversity equity and inclusion in the workplace, as well as what can be done and what he is already doing to advance and improve equitable representation across the industry. Keep listening as we head over to the conversation now.   Adam: (00:59) So Anton, historically conversation about race and the workplace, particularly within accounting simply have not happened. Now, there have been great achievements in DE&I, but there's still much room for improvement in our industry. Why do you think that is?   Anton: (01:16) Adam, If I had to really give you an answer to that, I actually think it is because we in society and in particular US society have a great deal of problems talking about the subject of race and racial representation. It's almost a taboo subject in many ways. So the problem is we know we have poor representation currently. We know we've historically had poor representation, but nobody really wants to talk about why that is because race and racism are sticky, unpleasant subjects to talk about. And part of what seems to be my life's cause now is a core trying to provoke a conversation around this area, which is not polarizing, which is almost impossible to do by definition. But to my mind, if we can't have a conversation about race, racism, why we have poor black representation in our accounting profession and have had historically, and, you know, if we can't have this conversation and it be at two polar opposite ends to this, but yet still respect each other, each one another's views, we will not actually significantly change the situation. We will not deal with this problem effectively. And to my mind, that has kind of been the status quo for quite some time.   Adam: (02:58) Yeah, that makes sense. I think I've seen that as well, but as we specifically like focus in on accounting, as you kind of did there at the end, you are often the only person of color in a predominantly white workplace day in and day out, you know, how have you handled that and what have you done to advance the way that is perceived or how you feel about it?   Anton: (03:18) It's tricky, isn't it? There are those critical theorists, critical race theorists among others who talk about this environmental microaggression that occurs being the only black person in an accounting organization or any other organization that when you step foot in the building of which you work and you are one of the three people out of 500 that work there without anybody saying anything without anybody saying you don't belong, you feel it in the very walls of the institution you're in, and it can be a quite effective way of pushing those of difference out of the doors in terms of how one deals with that. It's difficult. the entire reason why I look at the area of race and racism and where I'm originally from, from Britain as you may hear in my accent when I was a jobing accountant, so to speak, that would happen to me all the time.   Anton: (04:25) And it's the reason that I began to look at this subject topic, cause I always wanted to know, well, why am I the only one there? And as I was experiencing this, I really wanted to have other people of color, other black people, other black professionals, ironically, to talk about this, to say, I'm not going mad. Am I, are you having this feeling as well? And the truth of the matter if they just weren't there and it becomes a circular problem, right? What am I doing to try to change this? Because I'm an accounting professor. One of the things I try to do is encourage now I'm here in the United States, as many African Americans as many black accountants as I can into profession with more numbers, it kind of gets rid of that feeling of being alone. But unfortunately it's still a very difficult process.   Anton: (05:17) Another thing that I've tried to do is write more publicly in things like the CPA journal. I've tried to increase my social media presence. I've tried to reach out with my own podcast, Counting Black and White Beans as an idea to be able to be used as a resource to allow those black accountants who feel isolated, who are feeling a little bit lost, let them know that this is not unusual, that this is actually quite common, whether it's in the United Kingdom or the United States, and for them to have a feeling of kinship, of a kindred kind of effect for one of a better word kind of saying you're in, we're in this together. And so I'm afraid to say, Adam, if you're looking for an absolute definite answer as to how does one deal with the isolation often of being one of the few black people within an accounting environment, I can't give you any firm answers to that. I suspect it's as difficult to deal with today. As I found it decades ago,   Adam: (06:27) I'd imagine it is, it's not easy being underrepresented in any profession. But for the black accountant, there has to be various stereotypes that are there tales. Can you explain how or why these stereotypes exist and what impact that misinformation has?   Anton: (06:42) Yeah. And again, these stereotypes exist in our profession and other professions as well. Because we, in my opinion, and many others live in a racialized environment, you know, we, our racialized views of those who are different from ourselves, don't stop at the doors of the organizations that we work in. Some of the traditional stereotypes that black accountants often have to deal with that I've found in my research and many other's is one would be of being angry. If you are a black male accountant, and I should be clear here, there are different stereotypes often for black women accountants and black male accountants. So for black male accountants, anger is often an issue. So, you know, if one is out on an audit and you find something has come up and you're in the middle of a meeting with your team to try to address this issue and tempers become a little bit frayed.   Anton: (07:54) If you are the black accountant, you understand clearly that you cannot be passionate like your white colleagues, because that is seen as being angry and unprofessional and unbecoming, that latitude is not afforded to you. And of course it makes it difficult in terms of impression management. Once we come around and look at performance evaluations and it may come up that you are unprofessional, angry, you scare inverted clients. On the polar opposite, perhaps would be the experience that many black women professionals have of being seen as the Sapphire, this steely hard unemotional unempathetic professional that is cold sometimes also can be angry in that negative way. But the idea here is that she is not a team player. She is overbearing she's quintessentially, anti feminine or unfeminine, if you like in this setting and be it with just these two examples of stereotypes that you mentioned that are often prevalent to the black accounting or black professional experience, whether it's being too angry, if you are a black male accountant or being positioned as Sapphire as a black woman accountant, both positionalities for wont of better word, mean that you are othered and you are positioned outside the professional, the remit of being seen as completely professional.   Anton: (09:34) What I mean by of that is you're always on the outside, looking in, you can never truly embody that authentic accountant, that trusted accountant, and that's actually quite vital for the work that we do.   Adam: (09:48) Definitely. And, those, just those two examples that you used are not isolated to just accountants. I've seen those in any other profession as well. Just how people view folks of color in that way. And that kind of brings us in our conversation. I wanted to circle back to something you mentioned earlier was microaggressions. You know, we often hear that term, but I'm not sure everyone truly understands what that means. And to what extent they can have an effect on people in the workplace. So maybe you can share your thoughts on that with us.   Anton: (10:22) Yes. microaggressions, one of these many terms that's kind of banded around, but people don't give you a concise definition of really what they are. Essentially, microaggressions are racialized. Racial, like aggressions are, are flights often verbal, sometimes environmental, as I've highlighted that say that you are not welcome, you are not wanted, you are othered to give you the best example of what a microaggression would be like. Imagine Adam, that you went into your account workplace, and as you sat down, had your coffee opened up one of the letters, one of the many letters that you had, you've got a paper cut. Now we've all experienced paper cuts, right? Sharp, painful, awful annoying. It's not going to kill you, right? You're not gonna bleed to death, so to speak, but it's annoying. But imagine if you had 50 paper cuts a day, every day that you went into your workplace day after day, week after week, month after month, year after year, eventually you get almost a part of you dies by a thousand paper cuts.   Anton: (11:38) If you like, at least that professional part, that professional self, and it can be incredibly harmful to one's psychological makeup. It can be incredibly harmful to one's ability to function in the workplace. It is continual and unremitting othering. If you like, and it's a genuine problematic, it can be micro thoughts as we might term them where, and forgive me on some of my definitions here where we might think that we are not welcome in the workplace because essentially we don't belong. I.E., black people don't belong in accounting. That might be inferred in a very subtle kind of way. It may be as I once witnessed with not so much black accountant in Britain, but south Asian Muslim accountant back in the United Kingdom where I had interviewed a respondent and he cited that he was offered bacon sandwiches regularly.   Anton: (12:50) And if you are of Muslim heritage, that you cannot do that. And it was kind of known. It's not a direct physical attack, but it's incredibly deeply offensive. And it's these kind of actions that cumulative, that relate to something term battle fatigue, where it just becomes too much, you become depressed. There are physiological effects that can happen, including extraordinarily high stress levels which can lead to high blood pressure, et cetera, et cetera. And you know, when we're talking about these microaggressions as well, and, you know, we should not forget about this concept that you've alluded to Adam about intersectionality. So some of this, again, speaks to not just being a black person in that environment, but whether you are a black woman in this environment and that gendered piece should this black woman go into the workplace and her hair is for example, now braided, it is seen as unprofessional.   Anton: (14:00) And in that unprofessional environment, you may not be recognized as working there. There have been reports of this. it may, you may have the typical side eye. People may not want you in front of the clients because you don't look professional enough. As women will understand if one's hemline on any given day where when a skirt is, is worn, is too short, one gets judged upon this, this idea that there is a controlling factor in femininity in general, but specifically on certain aspects of black femininity. And when we're talking about hairstyles, the same thing then crosses over equally to African American men who may decide to wear their hair in dreadlocks. And that, again, positions them as being unprofessional. Although to be fair, there should be a right for people to hold their own style, their own way of being their department that is actually true to their own culture. And that actually speaks to something else, which is quite interesting. If we see these variances in what is acceptable and not acceptable, then the environment that we work in, Adam, within accounting has a set of unwritten rules. These rules are about what is professional and what is considered professional is what is considered both pale and male. And that's really important because if you are not male and you're not pale and arguably middle class, then you are always going to swim against the tide of your success in that environment.   Adam: (15:36) When you don't look like that, typical professional, like you were just talking about it others you, right. How can we make steps to go forward to change that perception of what a professional looks like? It seems like a broader conversation and something you can't just flip the switch and say, this is how you do it, but what steps can we take to changing that perception of what a professional person looks like? No matter what the color of their skin is.   Anton: (16:04) That is a really difficult question, Adam. I always say the simplest questions are the most difficult ones to answer. And this is true here for us not to other, we must reticulate truthfully what we consider an accounting professional to be. And if we're honest, think about how we, how we term accountants. When we joke about them, we call them bean counters. Right? If you imagine in your mind's eye, Adam, what a bean counter is. I would say bean counter to me is possibly a middle aged white man, possibly be speckled. Right? Okay. Gray hair with a calculator, furiously tapping away, possibly doing some taxes. Yeah. And this is important because that mental image that I have is to me, the authentic accountant, that is the accountant that I trust with my money. I don't want an interesting accountant.   Anton: (17:09) Somebody who looks like they go and party or looking after my money, but all jesting and joking side, if you are not that archetype of an accountant, then you must be something else you must be other than what I expect. And that othering piece has to be removed. Because even though I talk about this othering of black male and female accountants, we must have also talk about the othering of our Latinx community, the othering of our LGBTQ+ community, the othering of women in general those who are less able bodied than ourselves in terms of othering, that othering piece is a tricky thing to deal with. That's what we've really got to co overcome. And so, for example, even how we approach dealing with this othering concept must be well thought out. So if we somehow magically manage not to other black women and black male accountants, are we leaving our Latinx brothers and sisters out?   Anton: (18:19) Are we leaving our LGBTQ plus brothers and sisters out? Are we leaving those colleagues who are less able bodied out? Are we leaving other stigmatized groups out? If we are going to do this, we must. The analogy I like to use here, Adam is we must raise all ships. We must have a tide of equity and equality if you like that raises all ships at the same time, which is why I always force through this idea of intersectionality. When we look at dealing with this devilishly tricky concept of othering, and I'll be perfectly truthful here, Adam you are asking me for solutions that I don't have. I don't know how to do that, Adam. I really don't know how we do that. I only know I think one thing that as we deal with this sticky problem of othering, we must do it together. We must everybody, everybody must join in this conversation, which is why I advocate for the idea of conversation, of dialogue, of not being fearful. Yeah. That stops us dead in our tracks. When we can't talk about this issue of othering and say to ourselves, well, let's try this. Let's try that. Let's try this in a manner that says we work together and not work against one another. If that helps.   Adam: (19:44) It does, it really does. And I think the idea of conversation is a great way to start dialogue. People need to talk in not attack or condemn or assume, but actually just have that conversation cuz until you have the conversations and start the dialogue, sometimes your eyes aren't open until you start talking   Anton: (20:04) Without a shadow of a doubt, Adam, you know, and again, it would seem that we've lost the art to talk and to talk in a manner that does not malign the person we're talking to that doesn't reduce the the other person's sense of, of self worth or being. We really have to have great. We need to do better in that. You know, we are, unfortunately, and it's not just the United States here in my homeland, the United Kingdom, it's just as bad and in our areas across Europe as well. And in other places, we are entrenched in this, position of polarization, of partisanship. It's getting us nowhere. And certainly it, when we do that, we remove the tools of which to deal with very difficult problems. And that in of itself is something we're going to have to deal with.   Anton: (20:59) But actually as a matter of point Adam, I actually think our profession in accounting is really well suited in what we do to begin to make inroads to that very point. Why would I say that? In accounting, we are all about teamwork. We are all about dealing with difficult intractable problems that seemingly often don't seem to have a solution, but we come up with them all the time. And not only that we are in the business of relaying that information out there. I actually believe that accountants in this area, if we really set our mind to it with our skill sets, we can actually do something quite special, but we can't do it. If we can't talk about it, we can't do it. If we are polarized and partisan and we can't do it if we don't admit where we are and what we need to do about it, going forward about this racialized space within accounting,   Speaker 4: (21:59) This has been Count Me In IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Paul Ruppert: https://www.linkedin.com/in/paulruppertintl/ Full Transcript:Adam: (00:05) Hey everyone. Thank you for coming back to listen to another episode of Count Me In, I am your host Adam Larson, and this is episode 176 of our series. As we hold conversations about various topics impacting the accounting and finance world, one of the underlying themes across most is strategy. In this episode, you'll hear from Paul Ruppert, an ambidextrous executive with deep experience in startups, as well as global fortune 100 enterprises who shares as knowledge and expertise on strategic partnerships. Keep listening to hear more about how the finance team can best support large strategic initiatives for the organization.  Mitch: (00:50) So as we get through today's conversation, we're gonna look at some concepts around strategy, strategic partnerships, but I think it's first important to kick off what are some of the biggest considerations or are challenges that many are facing in today's business landscape?  Paul: (01:06) I think, you know, many people get into business thinking that there's some linearity from a plus B plus C equals D equation, but in reality, it's all about adaptability and change. And change is not only the change that you experience when you start facing various types of problems and challenges and friction points, but also your ability to manifest change, create that change and live through that change. I've been involved in businesses on a global basis and how I approach the business in the US was very different than I was approaching the business when I was in Hong Kong or in Europe. And that adaptability, that agility as it's often described, you know, in technology is really the the watch word more than anything else, in my view. You know, there's, as I mentioned earlier, earlier before our call, I don't believe in a silver bullet solution.  Mitch: (02:13) And as we talk about adaptability, agility, you know, the bottom line is we are looking to advance the business, right, advance the function and adapt to modern advancements. And I think you just kind of mentioned briefly technology here, but without having a crystal ball and being able to see into the future perfectly, what does the future of business really look like? And, you know, as we continue to adapt and be agile, what are we really preparing for? What is the future of the business landscape look like?  Paul: (02:45) Well, you know, that's a big, big question in the context of where is everything going. If you just look at our immediate past in past history, you know, three years ago, I'm involved in the text messaging business and it's been around, it's how, you know, enterprises communicate and connect with end consumers. And we live through it on a day to day basis. When you get tested for what's called a one time password, you know, you just proving that you are who you are. And the business let's say three plus years ago was moving steadily along. And let's say let's call grocery store rates, meaning about three to 5% growth rate. This is a fairly established industry. You know, it's roughly about $200 billion of business globally. It's quite large, but people don't really experience on a day to day basis relative to cost and effect if you will, but they still utilize it.  Paul: (03:47) And since the pandemic, because of the dynamics of how we behave as human beings and being working from home environments and the fact that we are now utilizing zoom and video, et cetera, the reality is that the messaging business has grown to about 30% CAGR for the next three years is what the expectation is. And I am of the belief that once human beings experience something much more convenient for them, they usually don't turn backwards and want to do something less convenient. Okay. So in all of that context, that's kind of the dynamics of where we are going, what it looks like and the over the horizon perspective, the crystal ball, as you characterized it is that your expectations often may be unexpected. Things may not go as you think they are going. And there's lots of converging factors, you know, digitalization prior to COVID, the growth of it, the speed of it, the means in which many business were able to quickly and with great agility pivot to new types of initiatives, you know, I can talk about call centers that were stripped down from being on premise in the course of four to five days and redistributed to the the call center rep's homes, because everybody shifted, you know, we couldn't be in large groups any longer, it was just too unsafe.  Mitch: (05:22) Now a lot of our listeners are in, you know, the business of opportunity recognition. And I know it's very difficult and maybe unexpected as some of these you know, evolutions arise. You know, we first spoke, I know you mentioned something along the lines of you know, the business landscape reaching 6G. So with some of this uncertainty but so much opportunity, what can our listeners really take away you know, from the idea or what should they be doing really to maybe open their eyes a little bit and see what this opportunity means for their individual businesses,  Paul: (06:03) Right. Yeah. You know, we all watch well, many of us watch professional football, the NFL on weekends, and, you know, the number of mobile phone companies like principally T-Mobile, AT&T, and Verizon all talking about 5G. And then if you were to turn to your spouse or friend that you're watching the game with and ask the question, so why is 5G better than 4G outside of the reach? You know the reality there is that what we're doing right now is probably gonna be the, one of the big manifestations of 5G value, which is video and speed and processing. And so as we then move to 6G, then it becomes much more engaged on such things as what's called sentiment and intent. So you might be reaching out to, you know, let's say your mobile phone provider, because you've got an issue with your iPhone or something along those lines and that inbound call or inbound message or whatever it might be that platform that you're utilizing to connect with your provider, they already have a sense of what your intent is.  Paul: (07:17) Why are you calling, you know, and that's, you know, consumer data products and platforms that are looking at combining your personal behavior, as well as the fact that you might have an iPhone eight. And, you know, the lifespan of that iPhone eight is probably five years past it's optimal performance. And so soon as they start talking to you, whether or human being, or not, whether it's a chatbot that may come into the dialogue as to, would you like to upgrade your phone? We see that it's six, seven years old, something along those lines, that's the kind of stuff that'll be playing out, which is a little spooky.  Mitch: (07:59) It is, it definitely is, but everybody's looking for the answers as fast as possible. Right. So if that means getting them to the solution sooner, I think we're just going to adapt and take that luxury eventually. So with that in mind, you know, I think, like I said, going back to opportunity recognition, this is an opportunity for individuals to really expand their horizon, right. And it's an opportunity to possibly, you know, take their business or their function and look to build some strategic partnerships with others who are able to bring those opportunities to us. So when it comes to strategic partnerships, what are some of the things that individuals should really pursue or make sure that they have you know, for both sides, I suppose to make sure that this endeavor is worthwhile, you know, with technology, there is so much risk and uncertainty but developing strategic partnerships, what are some of the keys to consider there?  Paul: (08:59) Yeah. First and foremost is to be open-minded, don't be close-minded relative to what you're looking at because even potentially partnering with your competitor may have value I'm in a business that is cooperative and competitive at the same time. And you can't do the business without having that type of relationship that you may be competitive hammer and tongs in the marketplace, but technologically, both of you need each other to be able to provide the solution to the broad marketplace. So open mind open-mindedness flexibility. I used to, well, I still use the term agility and humility in the context of you're not walking in saying, this is what I think I want. And instead, you're thinking about where are the opportunities, as you mentioned, the opportunity recognition, the opportunity subsets, and then it's as much about what's your strategy in terms of partnerships, are you looking to influence influencers that are gonna be making buying decisions?  Paul: (10:06) That's a different initiative than trying to figure out I was once in a project where myself and my technical lead in a company, we were in a hotel bar in Tokyo, and this was in 2012. And I said, you know, this whole thing about cybersecurity, we gotta figure out how to be able to provide a solution to identify potential infringements on mobile networks and text messaging. Could we do that? He was like, well, yeah, you know, and he brought, broke it down relative to the analytical functionality, but we didn't know in the platforms. So we then went hunting for who could provide that type of platform, that functionality, and we found them. And so then we reached out to 'em and said, this is what we do, you know, and this is what you guys do. We want to be able to figure out how we might be able to work together. And within nine months, that was a live trial with, at and T. And within two years, we were generating about $16 million in revenues, which was roughly about 8% of the total revenues of the business unit at that stage.  Mitch: (11:16) And, you know, strategic partnerships, something for many of our listeners, accounting and finance particularly internally we address this as business partnering, right? Being able to raise awareness you know, identify some risks, not necessarily give all the answers that everybody wants to hear, but look at it strategically. so before we get to the accounting side of things, just from this risk and strategy, you know, concept and, you know, talking about foresight, looking to see that we need to do something, maybe it is working with a competitor or somebody that you've never worked with before an industry you've never dealt with before, with all this technology evolving now, how do you ensure that whatever partnership you're proposing, you know, when you bring it to the table and you have these internal discussions, how do you ensure that, you know, you get that buy-in and you, you talked about influencing, but how do you take it to the next step where you can actually see the results that you ended up seeing?  Paul: (12:14) Well there's no guarantee to any of this, you know, you may be starting off on your journey with the objective of, yeah. We found this company and they do this type of process, and let's go talk to 'em and you may find that they're not very likable or they're not very cooperative, or they're not interested in having that kind of dialogue because they think that you might be stealing their IP or whatever it is. So it's as much about, oh, you know, coming with an open hand in an open mind and kind of laying out here's the opportunity. I was once in an acquisition in a company that we got approached by a visionary, and he said you know, this text messaging stuff, this was in 2006, mind you almost 15, 16 years ago, this text messaging stuff would be great in a customer relationship management software capability, which is what we do, you know, and those of us who were in the transport side messaging side, we looked at each other and thought, who would've ever thought, you know, we should have thought that.  Paul: (13:19) So, you know, here's somebody who's coming forward with a potential partnership while the partnership was in acquisition is how it all played out in the end, favorably, mind you. But, you know, if we had put up our guards and weren't really interested in having that conversation that wasn't our attitude. We were open to any conversation because we had already been looked at before, you know, but we also recognized that wasn't a good play. We walked away from it. No harm, no foul type engagement. And then something else came up. We were like yeah, this might be viable. And our investors, like, this is what we should do.  Mitch: (13:56) And then, you know, as far as investors, you know, M&A, a lot of that, our listeners are a part of, and I do want to bring this to our, you know, the accounting and finance side of things. We talk about a lot of the strategic partnerships, opportunity recognition, and many of us are, you know, involved in these, but you know, it's cross-functional and somebody like yourself, you said, you're not in accounting or finance. You know, it's important to have relationships with those who do understand that. So, you know, from somebody who is experienced and successful with a lot of these strategic partnerships, from your perspective, what is the value of having somebody with that accounting background  Paul: (14:37) It's critical. and I think I mentioned in our pre-call in the context of how I've approached this being a commercial guy, you know, the moniker, just a sales guy, I'm not just a sales guy. You don't go from sales to M&A, unless you've, you know, laddered up and have a fair amount of skill sets to be able to support that. But in every case where I've run either a product group or even a sales group I had somebody that I designated as the financial expert, meaning somebody who I could turn to and say, I wanna model here. And here's how I want to model this type of pricing exercise or what the valuation might be relative to, you know, let's look at the business case and create that and create that quickly. You know, I can do that, but it takes too long.  Paul: (15:24) And so I'd rather go off and get some, you know, younger, you know, person who literally I've walked in to an office where we thought we were gonna be firing somebody you know, and about five minutes after meeting with the guy re recognized that he was gonna be more valuable if we kept him. And I put him on my team and essentially said, would you be interested in joining the product team, even though you are in finance? And he was like, well, yeah. I mean, that seems a lot more interesting that what I do in finance, it was like, okay, you know, targeting people who would have the right affinity and the right perspective and the flexibility to be patient with those of us who are not spreadsheet monkeys, I should say, spreadsheet, masters. and you get the idea, it's it's as much an attitude in terms of being able to communicate what the objective is, you know, I used to say, I write the manifesto, you write the code and be able to put that forward so that the bridges are made and the bridges are made early on.  Paul: (16:27) And that partnership is established early on, as opposed to, you know, okay, what do you want us to look at now? And even in the context of how to approach the problem, you know, recently I was in a conversation with a client where they were talking about potential acquisition. The company had no corporate development team. This was a substantial company, not publicly traded, but still nonetheless, a very substantial company, almost a billion dollars in revenues. And most of the stuff that they had done in M&A was on the fly, what I would call fire, ready, aim analysis. And you know, I looked around and I asked the question, okay, well, you guys have done a few, but they're really small. And this is a lot larger that you're thinking of, bigger scale. You're gonna have to do it swiftly.  Paul: (17:16) And by the way, there's a digestion period off after the fact. So the numbers may look seemingly at first pass a good thing, but there are a lot of soft analysis and factors that need to be reflected. So we need to ensure that those are reflected in the well that, you know, was a combination of my perspective and on the operational side, as well as the financial perspective of how do we measure and reflect the impact of those as costs, you know, and put a dollar figure behind that. And that that's a collaborative effort.  Mitch: (17:54) And, you know, you mentioned being able to do some of these models or analyses and doing them quickly. And I think a lot of what our accounting finance listeners are looking to do is, you know, upscale with these technologies in order to do their jobs more efficiently. But what you're kind of talking about here is really the re-skilling. Being able to take that skillset and apply it to a different function of the business. And I think a lot of what we're looking to do right, is kind of get that seat at the table. I think that's what a lot of our members and listeners want. So just, you know, you mentioned junior individuals and other finance you know, professionals, but as far as, you know, maybe the technical skills, but also some of those, the softer skills and just personality, how do you identify somebody from the finance team that you want on your team to help your strategic partnerships?  Paul: (18:44) Wow. You know, I wish I could say, well, this was my plan, in each of the scenarios, and here's the plan that I'll use in the next scenario, but that's just not the case. You know, it's as much instinct, instinct is essentially inferred experience and experience is gained. I should say an inferred expertise and expertise is driven by experience. So there's a gut factor in the context of knowing what I'm looking for and, you know, it helps when you're the leader of an organization and, you know, you know, what you want based on your past experiences. I guess generally I would say back to keep an open mind and look to, as you put it re-skill and apply your capabilities in other venues, because those skills may seem routine or even mundane in what you're doing. I mean, that's why one guy was like, yeah, you know, this is gonna be a lot more exciting than, you know, what I'm doing in the accounting group.  Paul: (19:52) Good. That's the whole idea, you know, that may seem mundane and routine in one environment, but then could be an extremely valuable asset in another environment. And that's how you end up by showing your judgment and skillset, et cetera. That's how you end up earning the seat at the table. As you mentioned, you know, we, there's a great book. I'm forgetting the author's name, but it's called range. And the premise of range is essentially that we have gone to the point where there's too much niche expertiers. One person does one thing really, really well, and they are viewed as the grand and therefore should be the unified leader. However you want to characterize it. But in reality, the complexities of the problems that we face, you know, there's a great example, like climate change, you just can't have one perspective.  Paul: (20:46) You've gotta have a lot of different experience to be able to come to the table. And I think that's as much what I've tried to do in my career. I mean, I've kind of ambidextrous in the sense that I have a pretty solid public slash political career when I was in my twenties and then exited into the private sector when I was in my thirties, but still utilized a lot of the skills and expertise that I developed, you know, as a young person in the political world and applied in the private sector. And even in the context, I then took that and pivoted into from going from large enterprises, you know, fortune 100 companies, AT&T, into startups and leverage that polish and process, but then also having the creativity and the agility, and even the attitude of being in a buccaneer inside a startup environment.  Mitch: (21:44) And so I do wanna wrap up this conversation. It's been extremely insightful. So thank you for sharing your experiences, some of the examples along the way you know, just as a last question for you, any last thing that you would like to add, you know, any advice or key takeaways from this conversation in terms of strategy, strategic partnerships, you know, earning that seat at the table, you know, what, what is a piece of advice that somebody in your position would like to share with our listeners  Paul: (22:14) So often I'm not going to label accountants as being the center of this, but so often people like, you know, the minimal viable product perspective of identifying your market and identifying your functionality and moving from zero to one, and then going from zero to one and realizing that, you know, that was a great success, which is essentially approaching a startup and getting a startup up and running. But I'm of the school that, you know, Reed Hoffman, who's the founder of LinkedIn, I believe, and wrote a book called Blitzscaling. And ironically, I kind of did blitzscaling before he wrote the book, but, you know, and as he puts it think going from zero to a billion and think in that context of, you know, I characterize it as going global from the start because global markets are gonna be bigger. They may be more difficult, but if you've got network effects that you can play out, you get faster, you get bigger and you end up defining the terrain that you're operating in relative to your competitors and even your customers. And if you're in that space, you know, then you're really the lead dog in all of this. So if there's one thing that I've would suggest, you know, I would, I'll put it in the context of special air squadron motto, which is the British SAS, who dares wins.  Speaker 4: (23:45) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Greg Hoggard: https://www.linkedin.com/in/greg-hoggard-cma-9a201b9/Counting Eggs With AI: https://sfmagazine.com/post-entry/february-2022-counting-eggs-with-ai/Full Transcript:Adam: (00:04) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. Kicking things off for you again is your host Adam Larson and I'm excited to introduce our featured guest for today's episode, Greg Hoggard. Greg is CFO and VP of finance and IT at Rembrandt Foods where he is responsible for all aspects of finance and accounting, IT, and grain purchasing. Greg co-authored an article in Strategic Finance to show how computerized vision and AI adoption can create significant value for an organization. In this episode, he discusses the value of aligning IT and OT and getting everyone in the company speaking the same language. Keep listening to hear how the intersection of AI and technology with finance leads to improved strategic performance.   Mitch: (00:57) So Greg, in your opinion, what is the value of, or really maybe even the need for information technology or IT and operational technology or OT to report into the same group.   Greg: (01:11) So for those that may not work in manufacturing, operational technology, so operations and technology, which are usually called a controls group, for those who work in manufacturing, they're the ones who deal with the hardware that collects the data. They have a little bit of a different talent than the IT group. They're data. They're not data miners necessarily, but they they're the ones who collect the data from the machines. They're a little bit of electrician, a little bit of, I hate saying maintenance. They're not maintenance, but they understand all those things. They understand how the operation is supposed to work and where the data's coming from. Think of those screens that you see in those old buttons and the really big, old manufacturing steel mill or just old manufacturing. When you see it on a television show, something, all of those buttons, all those controls, that's all done by operational technology groups.   Greg: (02:14) Whereas on the IT side, they really are the ones that control the data and the servers and the data bases, they make that data consumable for end users, and govern that data so that it's trustworthy and reliable. I think what we're seeing, these days in the last few years, especially, is that this whole internet of things push where everything is communicating with everything, those lines are starting to cross much more often than they used to, between like the operational technology groups and the information technology groups and what I've seen especially here at Rembrandt is that when those two teams work together, it becomes an unstoppable force. when those two teams are working separately and disparately, it can become a little confusing and unmanageable. So the need to have them report together, I think really it just drives change a lot faster and it gets you to the right answer much quicker.   Mitch: (03:26) So it sounds like, I would assume you mentioned this, you know, really being in manufacturing, but majority of businesses, they most likely require some additional change, right? Some new alignment to really implement this kind of strategy. So as far as change management goes, what are some of the key considerations for making this shift with the technology that we're talking about? The reporting. And really, I think it comes down to getting everybody from maybe two different sides to speak the same language. So, you know, what kind of steps would you recommend for that?   Greg: (04:01) So on the change management side, it's crucial that everybody understands their KPIs and their OKRs. So objectives, key results, and key performance indicators, really the goals that they're operating under, or goal posts, I guess you could say, I like to be a little more open-ended sometimes, but I think if you don't have that, then good luck with change. You gotta have that good starting point where everybody's working towards the same goal. I think that clear communication cross-functionally and just within the singular departments is necessary. And then I think that once you establish those clear metrics, you have, well at first you have to have something that, that can be measured, right? I mean, you can't have a metric that's not measurable. So having something that's accurate and objective to measure that goal is needed. And then really, I think these data visualizations, are much better tools to report feedback and then to measure against these goals than traditional scorecards and numbers.   Greg: (05:19) Most people don't like to look at numbers, I don't know if I should quote a book here, but I'm actually reading a book right now called Making Numbers Count, which, is a really good book by Chip Heath. And he's talking a lot about how most people really aren't wired to speak the numbers language. And I think as a accountants, we are wired to speak that way. At least we've learned that language and we wanna share the numbers down to the 10th decimal point to show that, to prove that we did the work and to prove that this is a real number, but other people get lost. so these visualizations that we're showing now with these tools like Tableau and power BI, those speak so much louder than the numbers that we wanna share. So I think this leads to accountability and acceptance of change. I don't think you can have change without that accountability and that doesn't come without that clear feedback. And then the objective measurements of clear objectives and key results and KPIs,   Mitch: (06:25) You know, with these metrics and, you know, the communication, everything you just mentioned with change management. I think, you know, the underlying theme here for both sides, you know, both languages, if you will, is the technology itself. I think that's causing the need for change and where people need to potentially, you know, learn a bit more or improve a bit more in their, you know, speaking capabilities, I guess you could say. So if we could just kind of shift from the human side of things and focus on the technological side of things and those resources for a moment, when adapting or implementing technology and, you know, increasing the need for this change management, what should our listeners really be most aware of when it comes to technology implementation?   Greg: (07:14) So I'm reminded of an experience during this, that I've been on with the company Rembrandt that I work for now and the team that we're working with. We, so I'll take a little bit dive into the story that was published as well at this point, but we have these analog counters. It's just an example. And these analog counters are just old technology. I mean, analog counting has been around since what the probably thirties, forties, maybe even before that, but anytime anything passes under this analog counter, it's counted as an egg in our case. So we have these counters on every single row of every single column of every single barn in our facility. And these counters, like I said, count anything that passes under that, their measure, their scope there and what we found, at the very beginning of this journey, we wanted to know if the measurement was accurate.   Greg: (08:18) So we performed an audit of the counters and we lined a hundred eggs up behind each of these counters before the start of the day. And then we turned them on and then after the a hundred eggs were counted on each counter, we turned off the system and then went and looked at the results. Some of the counters were off by 2% positive. Some of them were off by 2% negative. Some of them were off by 20% positive. Some of them were off by 20% negative in the worst case, some of them were off by 40%, both ways, but in the end, those errors offset each other. And so our operations group said, oh, well, we're within 2% overall. So we're good with these counters. Now, statistically speaking, you have to use absolute values and that would tell you that those counters are pretty much worthless, but that was one of the hardest things to talk about, with our group, because they had been operating for so long using that technology.   Greg: (09:20) And they had to trust it because that's what was available. I think now with improving technology and really AI at our fingertips, you don't have to rely on analog or on gut instinct or there's data there to be had. And I think really AI was definitely the path for us, but it's probably the path for a lot of other people with complex and really high quantity, high volume of data. Really. I think that harnessing all of that data or things that maybe we haven't thought really are data that's really what I believe will make companies more profitable over time. We're really all just data and supply chain companies. If you think about it, if when it boils down to it, you don't really have to work the hardest. You don't really have to make the best product, although those things are very important. If you wanna be a really sustainable ongoing concern type company, but really if you can make your product at the right time efficiently and get it to your customers at the right time when they want it, then really that's the value. I believe that many companies and most companies need to really tap into and really data is the way to do that.   Mitch: (10:44) Now I know our conversation today really initiated around an article that you wrote recently. And I know you, you said you kind of dove into some of the background of your company and some of your experiences, but I do wanna address the article and the significant value of AI adoption. So are you able to give us a little bit more of a history behind some of the initiatives that you implemented and, what the article is all about before we wrap up this conversation?   Greg: (11:12) Yeah, I would love to, actually, this has been really the high point of my time at Rembrandt so far. I'll take it back to the very beginning. in 2019, I wasn't working for Rembrandt at the time. I was working for a company called Oregon Freeze Dry in Oregon in Albany, Oregon. And, I had signed up and attended the San Diego IMA conference. And that's where I met, a gentleman named Daniel Smith, who I've been working with on this project, really, really great guy. If you ever get a chance to work with him, you should do it. But he sat next to me during a lunch. I believe it was a lunch and learn or a, just, we had a table full of full of experts and accountants and IMA members where we were just talking through different issues.   Greg: (12:09) And I was seated next to him. And we started talking about Python. We started talking about technology. There were a lot of other CMAs from the Philippines at our table as well, really good conversation convinced most of us at that table. Daniel did to go to his class, that he was teaching, the seminar that he had on Python and just making Python understandable for people like me, who aren't really programmers, aren't really data scientists. And really just got me thinking about technology. I switched companies and really came across these problems that I just talked about with the counters. We had a myriad of other problems as well, but it really occurred to me. I watched, I followed Daniel on LinkedIn and he was demystifying facial recognition and AI. And, I thought to myself at that point, well, if AI can recognize faces people, individuals, and all the different details that it takes to really identify who somebody is, then it should be able to identify an egg and eggs generally look the same they're different sizes.   Greg: (13:21) And generally the same shape. And so went down that path, contacted Daniel through LinkedIn, and that's where it started. I think it took us about two months to really get a proof of concept and a quote together to say, this is what it will take to do the project. And then we started really down that path of building a software system and developing that software to count these eggs and just the scale of these eggs. And I think I mentioned this in the article, but we've got 6 million birds on our site. And each of those birds, they lay eggs a little over six times a week on average. So it's about 92% of the time, of days they're laying eggs. So it's about 500, or sorry, about five, five point, I'll just say 5.5 million eggs a day, and the are all different sizes.   Greg: (14:17) So we have a big problem of trying to understand how efficient we are at converting the feed into egg, and then breaking those eggs into liquid, and then trying to identify where the loss is happening. So it seemed like a very complex problem that AI could solve. And what we found is that it works now, the hardest part has been, convincing people that this isn't Skynet. I think that, in the Ag side of the world, there's a lot of technology, a lot of AI, actually, if you read up on the Ag side of just Ag industry, AI is really taking hold. I haven't seen it yet in the egg industry, but, or I hope we're pioneering here and I hope it catches on, but it's, it's definitely an industry that, that requires something like this. There's just so much volume. When you think about feeding a nation and feeding the world, the Ag industry really is in need of really in depth complex models, which I think AI is really the answer to, to that problem of feeding the world efficiently.   Mitch: (15:34) Now, just real quick for our listeners. This was an article that was published in the February issue of the Strategic Finance magazine. And, we have a link to this article in the show notes here of the episode. And, you know, I just reiterating what you said. The article does a great job outlining the different phases and the different considerations that you went through. So as far as technology implementation and, you know, a real case on how it works and the benefits of it, you know, I think, it's a great example. And, you know, we're certainly appreciative of you writing the article for IMA and sharing your story here with us on the podcast, right before we wrap up, I just want kind of close out the conversation. At the end of the day, when it comes to technology and change management, you've had, you know, different experiences now and success with it. You know, some of the other considerations with technology that you, you briefly mentioned as far as the data and the governance, and, you know, really making sure that, you have your own policies in place. I'm just curious if there are any major lessons learned that really stand out, or maybe even, you know, more importantly, some key takeaways that our listeners can, you know, think about in their own technology implementation projects, as far, you know, things to remember.   Greg: (16:50) I really think the first thing that comes to my, for me here is, is so the president of my company now, he preaches people process tools, his name's Paul Hardy, great president. I think for me, what I'll take it back a second. So I love to build I'm a, I love to create things and we had so many things to fix. When I first go out here at Rembrandt I always ask for three years of financial statements before I accept a job offer. I think that's a good, a good habit to form for all of the accountants out there. You should know what you're getting into. And I knew I was getting into something that needed to be fixed. And that's kind of what that's my M.O. I really like to, to build. I like to fix, I like to, I think I understand manufacturing enough that I figured out the algorithm of how to make manufacturing work, but there were so many things, there were so many things to change, so many things to, to improve.   Greg: (17:50) I think I, I was thinking about this the other day, and there were 15 major projects that I undertook in less than two years. And we were successful in all of them when it came to implementing technology, when it came to building process and building the tools, what I wasn't as successful at, and only looking back, this was about in February last year, I realized that I had done all of these things and I left everybody else in the dust. I left the people out of it, and that was devastating for me. It was devastating for me to, to know that I did all of this work. I built all of these tools. I built all of the, the process, but in the end of the day, if the people don't come with you, then you're just left with a tool on the shelf.   Greg: (18:40) And that's what if I had to go back and change it? I would, I think, taking on less projects and spending more time communicating with the people, helping them understand why it's so important, maybe modeling and showing why it's so important before going off and, and just getting it done. I think that would've been helpful for me and something that I will definitely take with me going forward. That being said, we did a lot of projects, and I think we're getting the people caught up with us. So it's not like we wasted all of our time on the 15 different things. But yeah, I just have to say people, perceptions. Those are the most important part of change management, because a tool won't do the work for you, a process won't of the work for you in the end, there are people that are the most important thing that we have, the most important resources that we have. And if we leave them in the dust, then what good is the tool that we've put in place. So that's the lesson I've learned in the last two years.   Speaker 4: (19:51) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard. And you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Pedro Barros: https://www.linkedin.com/in/pedromonteirobarros/Remote: https://remote.com/FULL EPISODE TRANSCRIPT:Adam: (00:04) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host Adam Larson and today you are listening to episode 174 of our series. In this episode, you'll hear from Pedro Barros, VP of Finance at Remote. At Remote, Pedro was responsible for analyzing financial performance for budgeting and forecasting, managing all accounting operations and providing strategic guidance to accelerate business expansion. Over the last five years, he has been focusing on high growth tech companies and was previously Head of Finance at Codacy. He joined Count Me In to share his knowledge on building, scaling, and managing a successful global finance team. So keep listening as we head over to the conversation now.  Mitch: (00:57) So I understand Remote, your company is growing very rapidly. And, I'm just curious to kind of kick off our conversation here. How are you thinking about structuring the finance team during this growth phase and what are some of the key positions or key areas within the finance team you're really focusing on?  Pedro: (01:13) Thanks Mitchell. I joined the team as the first finance hire around two years ago, and it's a team of over 50 people today. I started the team top down, so we really went for, expertise and individuals with, subject matter expertise. But, it was a hard combination because we also wanted folks that could settle in, in well, in a very fast and growing, entity company. And, we found them like I've hired, two or three directors that really accelerated all the finance functions, a Group Controller and a Treasurer. And, a bit later than that, Director of Tax and all of these individuals really, really accelerated how the finance function was structured, how we were delivering to the business and how the finance was partnering across the organization.  Mitch: (02:17) And now I know we will talk a little bit, you know, as far as, scaling everything and how all this ultimately plays out, you know, for the finance function, but as far as the individuals go and as you're going through this hiring process, you know, for our listeners who maybe are looking to jump into new finance roles and things that are evolving across the profession in various industries, what are some of the qualities that you're really looking for in a finance hire and, you know, as everything is growing so rapidly, you know, a fast growing company like Remote, what are some of the skills that you're really, you know, targeting?  Pedro: (02:50) I touched, on my previous question around the deep subject matter expertise, it's folks, that can have a lot of ownership in their role. So someone that can compliment what I'm doing and, not necessarily build redundancy. So having folks that have done it in the past and can come very quickly, has done and have a high impact is critical. Someone that can nurture teams, because we knew at the place that we were going, that we would have to grow, teams very rapidly. And at the same time, we had to hire individuals that were very, tech savvy on the aspect of automation and how to make systems work for them and not just grow the team to address the growing pains and the growing needs of the organization as we're scaling very, very fast.  Mitch: (03:50) And you, you kind of just alluded to it a little bit. but you know, we were talking about individuals, the finance team, how does that really fit into the overall organization? Right? So what we're really trying to figure out here is, you know, how does Remote manage the company culture and make sure that everybody, you know, plays their part and, fits in, in a cohesive team?  Pedro: (04:11) Yeah. On your first point, the finance team at Remote is a bit different from many other organizations, as we are core to a lot of the product development that we do, a lot of the services that we provide. So we tend to, it's a subject like global employment is a subject is very close historically with, finance teams. And we have a lot of expertise in the team to help enable the overall company in terms of how Remote culture is managed in terms of fast growing and how we can sustain it. It was something that was designed even before the company was created, which were our values. Both the Auburn, Marcel, our founders, are very committed to the culture of the company through values alignment. We have a lot of cultural diversity, as you can imagine, by having folks in 60 plus countries across the globe working for us. So our expectation is we'll have a lot of cultural diversity, but an ambition is that folks will always work, at Remote with deep values alignment. And this goes with excellence ownership, kindness. It's one of the, I think it's the glue of the company. It is the value of kindness and something I have to in terms of automation and the scalability of the business.  Mitch: (05:41) That's great. I know you, oftentimes historically I think accounting, finance teams, at least the perception is they've kind of been siloed, right. Kind of the smaller group, you know, very focused on the numbers and getting the job done, but, you know, that has evolved so much. And, companies like yours, the finance function is really more or less the backbone for everything. And kind of, you know, what I've seen through various conversations here, you know, the team that's really driving those core values and just the cross-functional collaboration, the finance team, and those are the individuals who can really, you know, portray those values and gain support, and really partner to bring the business forward. So, I think, you know, aligning core values like that is certainly key. With that sentiment, you know, the idea that, global diversity and following these values, what else is it that your company is doing, that we can share with our listeners that would help other accounting, finance functions, finance teams, you know, grow and manage successfully like you are, you know, on this global basis, getting back to the topic here, how can we help other accounting and finance teams scale globally?  Pedro: (06:58) I think there are some fundamental things that the Remote is doing well, and it's working well, for us, in term one is, the working asynchronously. Means that you do your job and you work whenever it fits you, it fits your schedule. It fits your motivation when you are stronger. And it's not from not from nine to five, or maybe it is, it's not, it's independent from that. It's much more focused on objectives and not on the achievements more than on activity per se. And, if you are on, certain hours, and, the way we are doing it, based a lot on, documentation has managed Remote to grow very, very fast. Our finance team has grown massively and, very successfully continues supporting the business and delivering to our objectives. And I have folks from Korea to San Francisco, and, we are very much independent, from where, anyone is because they, they do their thing.  Pedro: (08:06) They understand what they need to do. Their individual has a very clear objectives and drive for excellence. They take ownership on their projects and, the work they need to do. And all these documented when someone is asleep, there's a document for me to act upon. And next day, that person is live at whatever time and they can pick up on that. So there's always this sense of follow continuous work. What Remote has also enabled in terms of, global distributes companies is, hiring the best individuals anywhere in the world. So subject folks have more expertise in a subject, here or there, or have been more face to fast growing companies. For example, in US, you have a lot of expertise of individual that have faced, the growth of, companies on a very fast scale. And we can hire them. And we are very geography, agnostic. Obviously we, sometimes we need to hire for certain geographies as an objective, but where folks are it's up to them.  Mitch: (09:21) Before we get into the geographies in the different countries. I understand the continuous work and the opportunity to work independently. Is there ever a time when you do have the whole team together, are there certain points maybe it's months, or, you know, throughout the year that regardless of where you are, you try to get as many people together as possible?  Pedro: (09:40) We thought about that March 2020, but, has happened that it didn't happen. Look, we grew very, very fast. So by the time all thought that the pandemic was getting a bit slower and we could potentially connect, like the team was massively bigger, different folks in different geographies in the world were facing, challenges. And, we are very respectful of the needs of each one of us. And, we are not going to, to ask anyone to, to go through airport trips when we're facing, the heat of a pandemic. Now we've grown to a size where more likely we'll be doing, team focused, get togethers in real life, for example, finance team, or a tech team and an FP&A team, as it makes sense or some geographical focused, gettogethers but, in real life, it hasn't happened at a large scale, what we do.  Pedro: (10:43) And I think there is a lot of purpose when we do it, is, weekly, all hands between the finance team. We connect one on one, weekly, at least so that at least we direct managees and managers, and sometimes some critical stakeholders or individuals in the team that are doing certain, certain projects that require closer connection with, each other. And, it's done with a lot of purpose, because when you decide to go on a call with someone, on a zoom video, it's to really, understand what are their challenges, how can you solve them if it's a synchronous meeting it's to ensure that, it's all things are addressed there. And, we do something that is also important when you touch the in real life is, in these one oh ones. We try to connect as individuals like work can be done in documents. But, I try to spend time with my team to like, let know how I'm going, how things in my life are going connect with my colleagues, my manager, and others, how things are going on their end, and to be very frank, the connection you have across the firm is very, very strong, obviously by now, I don't know everyone personally, but, I still know a lot of people, directly. And, we have a very close connection, which is super interesting.  Mitch: (12:17) That's great. It's, you know, a very compassionate culture. It sounds like, and you know, a very compassionate approach to building the team. So, I certainly appreciate that. And then now taking a step back as we were talking about, you know, different geographies and the different individuals that you're working with, what kind of infrastructure, you know, people, processes, systems, do you look to build first, as you go across, you know, different countries and, how do you integrate these different processes and such into the overarching, you know, finance function and tying back really to those values and the goals of the organization.  Pedro: (12:59) We have, an international expansion team specialized in growing remotes and while in most of the companies, you internationalize for commercial reasons, remote by default wants to be global so we can cater for our customers. And, not that we want to expand to a certain country because we have specific commercial needs there, but we want to provide, a global reach to everyone. So we are expanding globally very, very fast. And we have an international expansion team, very focused on setting up these across the group, understanding local requirements, legal implications, working with the tax team on tax implications, et cetera. And that's usually the first couple of steps treasury as well, setting up our banking infrastructure locally. We tend to work with some of the largest global banks, so that we can accelerate also opening, locally as well. And usually these are, the first steps very quickly, with the initiation of operations in a country.  Pedro: (14:08) We set up, a local texting that we work with usually outsourced with, with one of our main partners or local partner, if they do not cover that specific geography, we have an ambition to bring as much as possible in house, so likely with time. And if it's a major geography, we'll, have that expertise in house. In terms of system, we have been implementing SAP since we were 30 people in the company. We did a very fast, implementation of, 43 countries. And now we are rolling out to over the next year to 90 plus countries with the vision of being in 150 plus countries, very, very soon. So on that, with that, what we ensured with SAPs, that we had a scalable, highly collaborative and system with a very good, expertise in, in the space and, debt in box massively, how we can scale our operations globally.  Mitch: (15:17) Now, as you scale and, you know, grow, you go into these different geographies. What is your approach to fundraising? Would you recommend going with, more opportunistic fundraising? Is there any thing that you would consider a benchmark or a line that you really want to make sure you're following?  Pedro: (15:36) Remote has been very fortunate that, we always attracted very, very good investors to the company. And we have been growing, healthy, with their support and, fundraising that's, they have an investment they have may be making in the firm. In terms of opportunistic fundraising, if it makes sense, and you have, an ambition and you know exactly where you are heading and, you know, you can make good use of those funds. It makes sense, but opportunity usually comes from you being prepared with, so, and if you're already prepared to take action, it means that there is an underlying perception that will have good use for it. You are open to it, and you understand that, by doing so you derisk the business, you achieving your vision and your mission.  Pedro: (16:36) And, which usually is a tool, and it's not, an outcome, fundraising. And I see it very much, in that way, market dynamics sometimes are more volatile or more unpredictable. And if you secure now, why should you be focusing on very lengthy process in six months or 12 months from now, instead of doing it, today, obviously fundraising comes with dilution. So it's always the other side of the coin. And I think you, as a leader in the firm finance, or, CEO, or founders optimize for that, but, usually that opportunistic fundraising comes from you being already exposed and open to it more than, oh, it happened.  Mitch: (17:23) Absolutely. And, you know, I'd like to kind of wrap up our conversation today. as we, you know, we're talking about building scaling, managing successful global finance team, and, we addressed the independence of individuals, and you know, everybody working remotely for our listeners and anybody who is interested in scaling their business, or possibly going to remote finance teams, or still struggling with that aspect of it following the last couple years, what are just some considerations or implications, you know, that you would like to point out to make sure that everybody is aware of, you know, what goes into a team such as yours?  Pedro: (18:07) I think there some fundamental points that we touched earlier earlier on which are, on the team values on the team connection, and because growing internationally remote teams, it's not easy, you must do it with purpose and you must do it with care, and understand that if you are hiring individual that, have the values alignment to succeed in such an environment and in a company that is working fully remote, I think we have been increasingly more exposed to it. So which one of us is also learning how to succeed in such an environment, but, when, when you're growing our team, that is a specific consideration that, I would very, very much focus on. Obviously then you have other more infrastructure type of, of considerations on taxation of, individuals, especially if they are nomad and they are moving around the globe, where are they going to pay their taxes?  Pedro: (19:09) Can you hire them locally? Do you do it as a contractor because it's really a contractor type of, relationship or, you by doing so you're exposing to disqualification and you rather do it as a permanent employee also for equality between them and the rest of your team that potentially are headquarters or are working in a country that you have established operations. And, for companies, this also opens the point on permanent establishment, which by having someone, operating, on your behalf in another country, do they increase the risk of the company on permanent establishment or not? And this is assessment that needs to be done on a case by case basis, almost just profile of the employee that you hire remotely can, trigger a higher risk of burn establishment and maybe others that are, seem to be similar to not. And this should be assessed, but is critical consideration that we take when hiring someone internationally.  Closing: (20:18) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession, if you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Mardi McBrien, Managing Director of the IFRS Foundation, and Brigitte de Graaff, CMA, CSCA, Chair of IMA’s Sustainable Business Management Global Task Force and PhD candidate at the department of Accounting of the Vrije Universiteit Amstedam, join Count Me In to talk about the role of women in sustainability. IMA's Manager of Brand Content and Storytelling, Margaret Michaels, hosts this mini-panel discussion in celebration of International Women's Day. International Women's Day is a global holiday celebrated annually on March 8th to commemorate the cultural, political, and socioeconomic achievements of women. The special guests for this panel were specifically chosen for their work in the area of sustainability and to talk about the pipeline of future female finance leaders as well as their own thoughts on what unique impacts women are making in the work of sustainability. In this commemorative mini-panel conversation, Margaret leads the discussion by addressing various pieces of research to substantiate the value of women in sustainability. Download and listen now!Contact Mardi McBrien: https://www.linkedin.com/in/mardimcbrien/Contact Brigitte de Graaff: https://www.linkedin.com/in/brigitte-de-graaff-134b408/Contact Margaret Michaels: https://www.linkedin.com/in/margaret-michaels/IMA's Website: https://www.imanet.org/Sustainability CFO: The CFO of the Future?: https://www.imanet.org/insights-and-trends/external-reporting-and-disclosure-management/sustainability-cfo-the-cfo-of-the-futureResearch cited: 2021 Weinreb Group Study  McKinsey’s 2021 “Women in the Workplace”  https://link.springer.com/article/10.1007/s10997-021-09604-7 Deloitte: Understanding Generation Z in the workplace Full Episode Transcript:Mitch: (00:05)Welcome back to Count Me In IMA's podcast about all things affecting the accounting and finance world. Today, we have a special conversation for you as we hosted a mini panel of speakers in honor, of International Women's Day. International Women's Day is a global holiday celebrated annually on March 8th to commemorate the cultural, political, and socioeconomic achievements of women for IMA and our management, accounting listeners, Margaret Michaels, IMA's Manager of Brand Content and Storytelling speaks with two women about their work in the area of sustainability. Marty McBrien and, and Bridget Degraph join Margaret here on, Count Me In to talk about the unique role women are playing in sustainability and the pipeline of future female finance leaders in this space. To celebrate this important day and valuable topic, keep listening as we head over to the panel conversation nowMargaret: (01:05)It is such an honor to be facilitating this discussion today. I have a strong interest in sustainability, and I know other Count Me In listeners do as well. I want to structure this discussion around proof points about women in sustainability, which have been substantiated by research. And I want to hear each of your reactions to the statements and their implications for women's work in sustainability. So the first proof point women are playing an outsized role in sustainability work. According to a 2021 wine group study, women went from holding 28% of chief sustainability officer positions in 2011 to 54% in 2021, which is a 94% increase. So let's start with you, Marty, in your role, you've connected with so many professionals in this space. Would you share your observations on working with women leaders in this area? Does it surprise you that women are playing this outsized role and what might be responsible for the dramatic increase in their participation and in the work of sustainability?Marty: (02:26)Thanks Margaret. And, thank you, IMA it's a real pleasure to be here on what is, you know, such an important day to celebrate, you know, the, really amazing community of women that have played such important roles in leadership both now and in the future and sustainability across the world. You know, I'm really, privileged to be , part of such an amazing space. And, and I guess if it doesn't surprise me the statistics that you have, I've, been lucky enough actually, to emulate the success of a series of amazing female leaders before me. I always say I'm so privileged that I've just had really fabulous female boss, female leader, female mentor in this space across my 20 plus year career, that I've just been able to, you know, grow and thrive and build off them. And so, you know, I'm going to be forever grateful for that.Marty: (03:15)but also if you think more broadly beyond me, you have, you know, sustainability women are the ones out there that are taking active steps to educate them themselves on issues linked to sustainability, whether that be within the home, in their broader community, in their lifestyles. And so as they learn more and more, they're actually looking for roles that reflect their, and I think that's what we're starting to see today. I is women taking on roles and wanting to jump into roles that you are increasing. You know, there's never been a bigger demand for roles in sustainability ever, and, and women more and more aligning their values. We can cut onto more of that later and stepping into that space. And if we think about my voluntary career, so not my professional career, but what would I do in my free time.Marty: (04:05)And, I do a lot of work with, you know, small charities that focus on livelihoods and empowerment work for women. And, and it's those women in these developing countries that are being affected by climate and sustainability issues the most. And they're the ones that are then taking action and wanting to do more. And so, you know, that's the space, I think, where we can all do a bit more maybe to help, help give those, those ladies that are really trying to take action, which will have, you know, significant impacts on our future. You know, I think there's, various different ways to take these statistics, but I think, you know, it's all encouraging and it's all the right to action of travel.Margaret: (04:39)Bridget, do you have any thoughts on, women's outside role in sustainability?Bridget: (04:47)Well, I think I mostly agree with what Marty just said and, it's, it's quite funny. I hadn't heard about these numbers before, but, when I started thinking now about the research I've done within companies on sustainability and integrated, and also about the taskers actually, a sustainable business management task forces. And if I'm thinking about that, I think we are really very much, I think either about 50, 50% male female, or even with the leaders, the sustainability officers and the leaders I spoke within those companies. I think we, a majority were us indeed female, andI never really realized that actually until now. And I start thinking about it. and I, agree that there's probably not necessarily just one reason who might explain this dramatic increase. however, what I can imagine is that as Marty just said, there are just so many roles now available within sustainability it's within that sense,it's not a new field, but it's a field where more and more roles are being created.Bridget: (05:51)And I think, as what I saw also in those companies is that sometimes women just tend to set up, step up and create a role in the way they think that is necessary in their organization. So they just start, you know, breaking down those silos, their themselves, that's what I've seen, those new roles they are available there. you just need to make it. And I think women especially are very well aware of how they can create a role and also how they can build in certain flexibility on what their responsibilities are, what they do, and don't necessarily stick into one silo, but make sure that you create these connections throughout your organization. so i think that might be, one of the reasons why you see more and more women in sustainability, just because they are stepping up and taking this chance. And also on the other hand, I mean, if you're looking at define as an accounting profession, if you compare 10, 20 years ago, until now, there are just so many more women available in the pool of accounting profession, professionals to pick up this role. So, it may also be just a natural growth of women in leader positions, nowadays. Yeah,Margaret: (07:01)That makes sense. And I think both of you, speak to sustainability and women's values and interest in the home in family and society as contributing factors. And I, I think that's very relevant. So the next, proof point, if you will, that I wanted to bring up, had to do with a finding from, McKinsey's 20, 21 women in the workplace study and not surprisingly in the year of COVID, McKinsey has said women faced special related to work life balance, but they also found that women's commitment to sustainability, especially in the arena of D&I remained unwavering. The report stated women are rising to the moment as stronger leaders and taking on the extra work that comes with D& I compared with men at the same level, women are doing more to support their teams and advance diversity equity and inclusion efforts. So let's start with you Bridget. What are your thoughts on this statement and McKinsey's finding?Bridget: (08:18)Well, I'm not sure whether I'm very much surprised about these findings. I can imagine that women having faced for a long time that maybe sometimes they just had to do the extra step in order to get to a certain place. They naturally might feel committed to a D& I, efforts basically. So I can't quite imagine that they know that's, how hard it can be, what hurdles you can, come across. And that therefore just it's, well, it's not in their nature, but it's sort of the way they, might feel like, well, we know that this is important and we cannot stop it, especially not in these times, especially not in the past year. For example, I also think that, well, they know what they know what it means, so they know what perhaps you might need if you, if you want to keep a healthy work life balance. If, you're learning your career, with personal wishes as well, besides your career that maybe they know what flexibility is required and they are much, well, maybe a little bit more, willing to accommodate that as well. So I think for the diversity equity and inclusion efforts that, I'm not very much surprised about the fact, that's, they are continuing on that even in this year. Yeah.Margaret: (09:42)And Marty, what are your thoughts on that?Marty: (09:45)I mean, I think this is something all leaders have to get better at, right? This is something that all of us have to keep challenging ourselves to evolve and get better at and think more widely. And, although as a, you know, a working mom that, that does the, you know, the sort of crazy juggle and as, you know, blaze my trail. I would say that we all need to get better at this. And I rely on all my team, all of those around me to continue to challenge, to continue to inspire me and others to do better in, you know, even everything from, you know, when we plan events to, providing everything from translation, making sure what I do is accessible to everyone around the world in a way they can access it. You know, it's not just me and my, you know, my little team and making sure, but it's diversity of thought and opinion that we're seeking on everything we do as well as gender, as well as making sure we're available in different times to talk to people, making things available so that I can, upskill other parts of the world in what I'm doing.Marty: (10:44)I'm just really privileged to have led a team for the last 10 years that have challenged me consistently on doing better on D&I issues. And I think overall, that's just made me a better person, as well and allowed me to, and to help others think about those, those issues as well. So I think this is a real team area and, personal area that I think we can, we can do better on it. And then always continually learning and evolving. You know, there's no one fixed answer to this.Margaret: (11:14)That's very encouraging to hear. And especially in IMA, diversity, equity and inclusion is a priority for our organization. And it's good to hear that it's also high on the priority list at others as well.Marty: (11:30)Margaret not to cut in, my staff would never let me get away with it. If it wasn't like culture is so important, the culture that we have, the culture, I mean, I could emulate the perfect that culture, but to be the staff saying, Marty, like, come on let's we need to do better. And that challenge just makes me want to do better. Right. And that's from men and women, you know, of all ages and that's, that's cool. That's where this, that's where this needs to be.Margaret: (11:55)I agree. And also, maybe people don't know D&I is, under the umbrella of sustainability, but, you know, it, as I get more educated about sustainability myself, I see how it's a natural fit. So, you know, I've, I've welcomed greater discussion about how de and I is a contributing factor in that.Bridget: (12:19)Yeah, well basically, if you are a sustainable organization moving more and more towards, towards a sustainable business model, part of that sustainable business model is that you recognize diversity, equity and inclusion that you just can't do it on your, on your own in just not your own way. You need to have this diversity of thought, you need to have this broader mindset. You need to think outside the box, especially if you're gonna move towards a real sustainable business model, real sustainable business management. You're just not gonna cut it with one way of few. So you really need that diversity in your team, and you really need that. That's, well, others are challenging you in a way in order to make sure that you are going to achieve those goals that you set for yourself. So it is an essential part of sustainability to have diversity equity and inclusion in your team and in your whole organization.Marty: (13:11)And it's not a tick box exercise, right? This is not one of those ones that you just tick the box and you move on.Bridget: (13:17)No, it's something you really have to work on, but you really have to live it as well. It's not something you can just align with and, and, and hire someone, that you think, well, that's creates diversity. No, you really have to live and breathe through this and really probably need to make changes to your, the way work, in order to make this happen.Margaret: (13:37)Absolutely diversity equity inclusion, as you both mentioned, encompasses gender, but it encompasses race. It encompasses age, it can encompass a whole variety of factors. but another proof point I wanted to take a look at was, the link between gender and sustainability engagement, which is kind of the thesis of this whole podcast. there have been researchers who studied the link between gender and sustainability engagement with their results published in the October, 2021 issue of the journal of management and governance, which is a peer reviewed journal. They found that the presence of women in top echelon positions is associated with greater engagement in social and environmental projects, and their presence also positively influences the mental and social performance and increases the level quality and transparency of sustainability disclosure and furthermore, the presence of women in top echelon positions and the implementation of sustainability activities improve both the firm financial performance and value. So I just kinda wanna dissect, that finding because it's pretty impactful. There are clear indications that when an organization focuses on sustainability, they see improvement in their financial performance and value. So it's not just some intangible, goal it's very tangible and what they can achieve can be measured and will speak to investors and other people that, are stakeholders in the organization. So I just wanted to get your thoughts. Marty, we can start with you. Does it surprise you that there are tangible links between sustainability and improved financial performance and value?Marty: (15:44)Not at all here. I mean, no surprises at all. Mark. Great. you mean, we've talked about it a little bit already, but diversity for, or an approach just adds to the conversation at the top. and, it allows you to challenge, allow it to create more like inclusive conversations. It creates more resilient businesses and, and it is just, companies that are going through and putting the time and effort and money invest, you know, investment into really doing high quality sustainability disclosure, you know, good sustainability reporting and disclosure, isn't a cheap exercise, right? This should have the same sort of financial resources around it as you do for your financial reporting, the same sort of controls when you go to that sort of effort and you get that commitment at, the top, and you've got that broad diversity of thought. It's no wonder they're getting better performance scores, because they're thinking about this as a whole in the round and committing to it properly. And with the, you know, with that broader, you know, resilience thinking, you know, diversity of thought you will, of course naturally get better results. It's, thinking about something differently, taking something outside the box, outside a traditional thought process about how you can evolve something or do something a bit different that has better results in the long run for the business.Margaret: (17:05)Do you agree with that?Bridget: (17:08)Oh, absolutely. Yeah. Yeah. I think, I think this really relates back to what we're just discussing about diversity equity and include, you know, if you have, diversity of thought in your team, if you have diversity of thoughts in your, in your boardroom already, because that's where it needs to be. That's where the, in the end, these strategic decisions are being made. So you really want to make sure that there is diversity, in the, and at the board level. but really if you create that, it means that you are as a team, as an organization, you are much more, willing, but also much more resilient to the changes that are the outside, outside world is giving you basically. So really there isn't this business case for sustainability and it's shown in previous research as well. You know, the board diversity that it really does create value, not only non-financial value, but also financial value.Bridget: (17:57)And I, I don't really like the separation between non-financial and financial, because I think it's, it's absolutely tightly, not tightly not to gather financial non-financial value. but that's, that's, that's where, where the, the real value creation is, and that's where it comes from a diverse team. So with women on top, and not, not just women, just a real diverse, team that you need to have to make these decisions, they are, well, I think the force behind creating value in general, for yourself as a company, as well as for society. And that's what this whole sustainability premise is about. That it's not something which, is for just for the outside world. It's not just about a reporting part. It's not just about, about showing how well you're doing to others. Now, it's really integrating this in your, organization, integrating it in your, this making, integrating it in the fibers of your organization. Meaning that you're actually, like I said before, living through this, but that is what creates value for now, but also in the future.Margaret: (19:01)Absolutely. So finally, we've talked about a lot of different things I wanted to touch on the future of female lead and sustainability, especially their involvement in sustainable business management, which is so closely tied to strong accounting and finance knowledge. Deloitte, in collaboration with the network of executive women has closely studied gen Z. Those born between 1995 and 2012, who make up 24% of the us population and found that when it comes to choosing employers, 77% of gen Z respondents say that it is important that they work in an organization whose values align with their own. And these values include working for companies that place an emphasis on making a positive impact on society. So as companies look at this future pipeline of workers, how important is it that they adopt sustainability as an integral part of how they're operating and make sure that it's part of their companywide mission and values, bridge. Do you wanna start as a, I am a global taskforce member with people who are representative of gen Z. You, you probably know very well, where their priorities lie, choosing their employers.Bridget: (20:32)They, well, it's a fair point. It's becoming more and more important for this generation in need that they are working, that they are adding value to society, that they feel like they're doing giving something back to the community that is not just about creating shareholder value, but creating broader value, in that sense. however, I do not really think that companies who haven't made those steps yet that they are missing out in a way or that they, they, they are, I think they can turn it around really quickly. So if you want to speak towards, this, this workforce, of, gen sets, I think, there are still lots of opportunities. I can imagine. There has been so much has happened in the field of sustainable business management in the past, years, that you can learn so much from other organizations around you who have changed the way they work, who have changed their business model, who have changed the way they see or look at value creation. And I think Gen Z, for example, is, a generation who might see it, even though they want to work as an organization who has these values, they might also see it as a challenge to bring it to an organization to get those values. there's a great challenge there, but there's so much to, I think you can really turn this around real quickly as an organization.Margaret: (21:48)Marty, what do you think you think companies can ramp up sustainability efforts and, and meet these demands of our, of our future leaders and pipeline of talent?Marty: (21:58)Yeah, I think they're gonna have to, to be honest, I think if they're not there yet, they haven't got long there to get there because, you know, post pandemic more and more employees are acting with their fee, right. They're aligning much more with their personal values and wanting to go and find a company that aligns with their, you know, a professional versus personal value alignment as they're, as they're stepping out the front door every day. And, and often that's more and more as we're seeing in the pandemic more and more around making more sustainable decisions, different changes to livelihood situations, different balance of work, you know, buying, you know, so much has changed in the last two years of the pandemic that I think employers don't have very long to be really ramping up their broadest sustainability, work program that they possibly can to engage, not just GenEd, but you know what, I don't even know what I am I'm.Marty: (22:48)So now a days they call me something between baby boomers and Gen Z should I say, but, you know, even I require I've recently started a new job here at the IRS foundation coming from CDB. And the first thing I was like, is there alignment of values? Am I still going to be purpose driven? You know, I want a purpose driven job. Does this organization align with my values? Yes, it does. But you know, have to work through all of these steps nowadays. And that's a really important part of me when I get up and I you know, get out of bed and I go to work. And I think if you are not aligning more and more with sustainability, you just won't get the best talent and you won't get that inclusion and diversity of thought, you will be paying for second rate talent. And I think what you really need to be doing is starting to, move the dial further on this now and working out how, how you can align your business more and more with the broadening and fast paced sustainability agenda. And, then, you know, applying that to your recruitment and retention strategies as well.Bridget: (23:47)And, and actually, I also think that, you made a fair point that,, the good talents or the talent with a lot of, of well chances there. But I really think that there is, not enough, people focused on, sustainable business management as in, there is a whole world of opportunities out there in sustainable business management and talent is scarce in this field, to get to this real, point where you are able to make a difference within organization and really see how an organization moves away from this, traditional view on value creation and to how can we really be, well, indeed purpose driven those, people in the workforce. They are very scarce. I would, in that sense, just call upon all those, women in the fields and all the men as well, actually, because we need them all, but really to, to think about what this could mean for your own career and to see the opportunities that are there, they are plenty. So just go explore this wonderous world of sustainable business management, because we need you,Marty: (24:53)I, couldn't agree more on that. There's never been more opportunities to move in sustainability at ESG, anywhere in the world than there are now. I mean, they've never paid as well either. Let's be honest, you know, so I think I, if you are thinking of that, getting into it career into sustainability, dream big, I mean, there's so many opportunities out there go and hunt for what you want. You know, I, I wish there were so many out there when I was getting into it. And, yeah. And just jump in and have a try. You know, there's so many different angles to sustainability as well. There's, there is moving into sustainable final. If you're already in accounting or management, accounting, there's so many different of ways you can move into because these streams are getting closer and closer and closer together. You know, we're after business as usual, these things need to be so, you know, so closely stacked together that in five years time, we don't know the difference, right?Marty: (25:38)It's just business management, how we managing the business to create value in the short, medium and long term. We don't need to be talking about sustainability. It's about wider business management. You know, jump in, get involved, have fun. It's fun. It's a fun space. It's evolving all the time. You know, there's never a, you know, nothing's moved ever so fast in my career. So my life, even in fact how fast the sustainability space for employment and opportunities and just growth and learning and being part of the change and part of the solution. I mean, it's yours for taking,Margaret: (26:10)I, love your optimistic views on sustainability, and I'm really glad that you both are working in this space. You're clearly making a difference in champions for sustainability.Outro: (26:25)This has been Count Me In IMA's podcast, with the latest perspectives of thought leaders from the accounting and finance profession, if you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMAS website, www dot Ima, net.org.

Contact Dan Toma: https://www.linkedin.com/in/dantoma/Outcome: https://weareoutcome.co/Dan's other podcasts: https://theinnovationshow.io/episode/ep-230-the-corporate-startup-how-established-companies-can-create-successful-innovation-ecosystems-with-dan-toma/ https://thinkers50.com/blog/thinkers-50-podcast-dan-toma-and-innovation/ https://open.spotify.com/episode/2HeJjCHvNvCrD6vydCPsG4?si=u3kBTT3yR4W1D1Z_ie3Fxg&dl_branch=1 FULL EPISODE TRANSCRIPT:Mitch: (00:05) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host Mitch Roshong, and I'm here to introduce our featured guest for episode 172 of our series. This conversation features Dan Toma, an innovation thought leader and the co-author of the award-winning book, The Corporate Startup and Innovation Accounting. He joined Count Me In to talk about elements of the book, specifically the importance of the people in the organization and further defining innovation, accounting, Dan shares practical examples from his own experience as a product owner, entrepreneur, corporate transformation leader. So keep listening as we head over to the conversation now.  Adam: (00:55) So Dan, as you know, some something that companies have always done is look at their employees as assets and many times when there's a financial crisis, the first step is let's cut half the staff and move forward. But with the ever changing times of business and acceptability, that's not acceptable anymore. And so as businesses grow, they're encouraged to grow the value of their assets and the same approach probably should be taken toward people. What benefit do you see that in the workplace?  Dan: (01:22) Right. What should I say? I mean, you know, you walk in those corporate buildings, you work into various offices and you see slogans on the wall. Employees are our biggest asset on all that stuff. Right. But when you go and look in the financial records, you actually end up seeing the fact that employees are listed as cost as liability because they have obviously a salary attached to them. Right. So, yes, it would be great to have more companies, think of their employees as real assets, beyond the slogan, beyond the mottos, if you want, and start investing in them, if they will start treating people as assets, they will obviously start investing and nurturing their skills, care about their mental wellbeing. Do all these things that you would normally do to an asset.  Dan: (02:19) Like if you have a truck you are going to wash it and, you know, change your oil and put the best parts in it. But if you have a UX designer where if you have, a great HR person, how do you make sure that you actually treat that, that particular individual as an asset? But there are actually companies that do that. And, these companies are, you know, football clubs and in general sports franchises, they have their players list as assets. I'm not saying now that we should go in that direction and trade my accounting person from my bank, with your accounting person, from the whatever automotive company. But it would be fun, right? So yeah, in general, the, the benefits will, obviously go towards the employees themselves. Like they will have the most to benefit from. And obviously by them being treated as assets, the company will, obviously benefit. But I think, short term, the benefit will be with the employees later, the benefit will come to the company as a result of the employees being, regarded as assets, however, financial accounting considers them as liabilities. Hmm.  Adam: (03:32) That makes sense. So I want to kind of bring the conversation, back to your book. My co-host mentioned has mentioned your book in our intro and in your book, you cover nine myths, about measuring innovation. And I found them very fascinating. And I was wondering if you could walk us through a couple of those on how they relate to accounting.  Dan: (03:51) Yeah. So, we've uncovered those myths as we were working with our clients and, we decided to put them in the book because we fought and we, know there is a lot of people out there that still unfortunately live by those myth. So one of the first ones, and we actually wrote about this in the first book in the corporate startup as well, is that people tend to view R&D expenditure as a synonym for innovation prowess. And, this is very far from the reality, if you go, and, I encourage you actually, the audience to go and research two tops. one top is the BCG most innovative companies, of this year, I think is 50 companies they put in the top and the other one is the, top that comes from the European commission, if I'm not mistaken.  Dan: (04:46) And it tracks the biggest R&D spenders off that year. And if you put the top side by side, you're going to realize that the company that is number one R&D spender of the year is probably where near the top three or five is, in the innovation top. Take, for example, pharma industry. In the pharma industry, they're about three to four companies on the most innovative company list. And then there's probably 12 or 15 of them on the, on the R&D spenders, same for automotive and other industries aerospace. Again, it's a good example. So this is one of the biggest myths that we uncovered, while working with, while working with the companies. The other one was that innovation can't be measured because innovation is about creativity and creativity can't be measured.  Dan: (05:42) Anybody that worked in innovation, either being, employed in a large organization, part of the innovation department, or, had their own startup know that, creativity is probably 1% of, what it means to be successful in the innovation world, the rest 99%. And again, don't quote me on the percentages here, are, the 99% refers to discipline refers to, being methodical in, in your work, being very diligent in your actions and in the follow up to your actions. So again, obviously since we're talking now about a process, processes can be measured so you can measure innovation very well. Another myth is that the success of innovation venture can only be measured once it's in the market. Actually you can measure success or the potential success of innovation ventures very early on. This is how investors live.  Dan: (06:45) This is how VCs companies, exist. The fact that you wait until something is in the market to return a certain dollar amount, it's another form of success. And, some people could see already that success happening early on. Therefore they invest in early stage in that particular startup or in that particular idea, another myth that we found, and this was well, we were researching indicators. People tend to fit that everything is a KPI, right? Everything is a key performance indicator actually. We need to make a distinction between, and everybody that's in business needs to make a distinction between KPIs and the KRIs, key results indicators. The KPI, the ones with the P referring to the performance of the process, the KRI is referred to the outcome of that particular process. So, usually if we want to improve something, we need to understand the process behind it.  Dan: (07:53) Otherwise we won't be able to improve it, say you are a manager. And, I don't know, you're working in a plant, you want to improve, output. You need to understand the process that leads to that particular output increase. if you are working in a bank and you want to increase the revenue, that's great, but, there are many ways for you to increase revenue for once you can just sell the building. Yes, that will increase revenue, definitely. But is that sustainable in the long run? I think that if you don't understand how something is made, you won't be able to improve it. So it's very important for people to pay very, clear attention to how things are being made, the process, the value creation process, if you want, and then start putting measures on top because not everything is a key performance indicator.  Dan: (08:48) Some things are key results indicators, and those are a, results I'm repeating myself here. Those are, that's a result of a process. Obviously we uncovered other things as well, like, all innovation measures, measurements work, successfully for any type of innovation. Again, that's very far from the truth because, depending on the innovation you are doing, you need to adjust the form of indicators you put on top. If you're doing, more sustainable innovation, continuous improvement, different indicators are needed, than in case of an organization that does more disruptive stuff. The indicators need to fit, the purpose and the purpose is to improve something, right. I measure it in order to improve it. I can't just copy the homework from the company across the street. And, again, I can't copy it from, one industry to the other, those need to speak to my reality. Those need to speak to my context and to my circumstances is why I very important to, first of all, define what you wanna measure and why you wanna measure that before you put indicators on top. And obviously these were just like, I let's see half of the myths we uncovered in, in the book. I would encourage people to, you know, pick up the book and find the other myths by themselves. These are the ones that are probably the closest to my heart.  Adam: (10:19) Thanks so much for that, covering those myths for us. And I wanted to kind of help our audience kind of see where you were going. This podcast is for all things affecting. It touches all things, affecting the accounting and finance world. And, you know, your book talks about innovation accounting. So maybe we can start there. What do we talking about when we talk about innovation, accounting, and then we can kind of more dig into it a little bit?  Dan: (10:42) Sure. My pleasure. Just, just so you know, topic that I had my lowest grade in the MBA was, accounting, finance, and accounting. So, yes, I'm in a great position to write the book that it's called innovation, accounting. That recommends me, the, the idea of, of innovation accounting. again, it's not to replace standard or financial accounting in any way. The idea of innovation accounting is to build a system that's fit for purpose. And that purpose is to measure, progress and to measure results in environments that are, high on uncertainty and, environments that are, let's say more volatile than the standard core business, plus environments, where there are no financial metrics to go by. What do I mean by that? There are many companies out there that are successful today, financially that probably for the first five, even 10 years were totally unsuccessful.  Dan: (11:54) However, there were investors that were willing to bat on those, Tesla is one example, Netflix, again, another example, Amazon, it's a very known example of a company that wasn't profitable for, I think at least five years, how however their valuation was through the roof. So, with innovation accounting, we're essentially proposing a complimentary set of metrics to the financial ones that are to be used in the absence of financial metrics, where in the absence of financial results, those metrics are, designed to prove to investors, to prove to decision makers that yes, this particular venture should be considered for growth in the future. You should nurture that you should invest in that further because there is a gold pot waiting on you six months down the line, five years down the line in two years down the line. So basically it takes the guessing out of investing in risky ventures.  Dan: (13:01) And again, it's there to compliment financial accounting. we're not proposing a different set of indicators. We're not proposing to scrap the, the accounting books. We are that actually accountants and innovators work together for the greater good of those particular ideas, be it startup ideas, or be it ideas within an existing organization. There is a research by professor at, New York University, Baruch Lev, and he studied, the way investors take decisions whenever they invested in companies listed at the stock exchange. And, he analyzed data for, I think, 20 years then at least if not 20. And, he concluded that, as the years have gone by the use of finance information for investors as a meaningful way of predicting the company's future has gone down. If, one in three decisions were being taken based on financial results in the nineties.  Dan: (14:09) I think now it's one in 10 being taken solely on, on financial performance. So now investors are looking at alternative sources of information when they wanna place those bats, the stock exchange, yes, some of them actually go to Twitter and see what that particular CEO tweeted about. I'm not saying that's not a good thing to do, but that's probably further from the science than other methods are. So we, this is why we encourage organizations to adopt a system that's able to, present to investors, but also internally the picture of growth over the coming future. Again, in the absence of financial results, we're talking about what's going on in your R&D, we'll actually discontinue that. How many ideas from that particular, innovation hub, can you count on to drive growth in the near future? How does your portfolio distribution look like?  Dan: (15:11) Are you heading to a Kodak moment, right? Are you heading to becoming disruptive in the near future? Are you diverse enough to go through something like COVID, that was totally unexpected, you know, talking about COVID it was very funny because just at the beginning of it, Zoom's valuation was equal to the valuation of all us based airline companies, just, you know, to get an idea, get a sense of, how COVID changed everything. And I was just wondering then how many of the CEOs of those airline companies had ideas in their pipeline three, five years ago that had to do with communication, with self disruption, essentially like, Hey dear CEO, we know that we have a lot of business travelers let's invest in a zoom like idea. I'm wondering if any of the CEOs had that on their, you know, in their pipeline and they willingly discontinue it because of fear of self disruption. I don't think I'll ever get the question to that. The answer to that question.  Adam: (16:20) I don't think you ever will. Definitely not. Yeah. So as I'm thinking about, you know, what you've been saying, you know, the examples you gave of where that applies are very applicable to many businesses, but one of the main things that a lot of companies are realizing, especially with the onset of COVID is they've gotta implement new systems all the time, like, you know, new financial systems, new Zoom systems, Teams, everything, you know, you gotta get all those things together. And so let's maybe, maybe if we can look at, you know, implementing a system, because that's a lot of things we talk about is people need to implement systems all the time. What if we look at implementing a new system, you know, obviously it looks different from company to company, but if we look at the principles that you laid out for innovation, accounting, do you think that you could apply that to implementing a new system? Obviously there are the financial aspect of it and the accountants will take care of that. You know, how much does it cost, but there's other intangibles that I think your principles kind of help out with.  Dan: (17:23) Yeah. So, essentially in the book, we talk exactly about that, about the fact that, the innovation accounting systems should speak to your company and your company needs. Obviously we propose KPIs. We propose what needs to be in the system, but I believe, or actually know from experience that what we propose, will get customized probably at least 30 to 40%, when it gets, when it gets applied because the pharma company is not an airline and the automotive industry is not the banking industry and fast mover, consumer goods are not media companies or telco companies. I mean, no, I'm not kidding myself that we build something that works across the board. However, I think that what we've built is good enough for people to start and, to customize on. What's important is to follow the principles. The tactics will follow, the customization will follow.  Dan: (18:26) So we lay down six principles. First of all, if you are building an innovation accounting system, it needs to be company wide. You should not allow your retail, banking arm to have different measures than your wholesale banking arm. Why? Because at one point, those teams need to talk with each other and the CEO or the CFO needs to have transparency over what's happening in retail, as much as he needs to see what's happening in wholesale. If the indicator is different, you won't be able to compare apples with peaches. So it's very important. That's going to be company wide. So everybody in the company is talking about the same thing. Another very important principle is that the system needs to be able to abstract information. Now, abstracting information means that you take something from the team level and you are taking it through multiple layers and taking it all the way to the executive board.  Dan: (19:24) You don't expect an executive to have time to understand, for example, the learning we're experimenting and velocity of a certain, team. However, they will understand cost of innovation or they will understand time to market, or they will understand average conversion rate of your innovation practice. This is done for abstraction. Plus abstraction for another benefit. It forces you to only track indicators that are connected to water indicators. Cause otherwise if you just track this one indicator and it doesn't do anything, but just show you a number and it's not actionable, it doesn't inform any other layer of the organization. It doesn't have any impact downstream, better not track it. So abstraction is probably, or at least the one that is the closest to my heart. The third principle will have to be around, surfacing intangible assets. The innovation accounting system needs to surface those assets such as cultures, such as skill, such as process.  Dan: (20:28) Again, we started a conversation talking about, about skills and talking about upskilling people and treating them like assets, innovation, accounting, an innovation accounting system should be able to do exactly that. Another thing that again, ties back to our previous company, you know, question, an innovation accounting system needs to highlight the risk of disruption the company is under. It needs to be there flashing that red light guys. We only have this on this core banking product, and we're only living off that. Yes, we can milk that cow for, I don't know how long, but let's not kid ourselves and be honest and say, we only have that one cash cow and there's nothing else in the pipeline. And in case people will stop using credit cards tomorrow, we are screwed. And in case people will stop flying for this tomorrow, we are screwed, right?  Dan: (21:29) That's the role of the innovation accounting system to be there, to warn people or at least, make people pay attention to the fact that disruption might happen. Nobody's saying when it will happen or what form it will take. And even if your company will be affected, but at least, have that warning sign there. That's that's flashing, Hey, you have to do something about it. Obviously, another important principle is that the innovation accounting system needs to help you improve the innovation system. Every company has an innovation system, has processes has a real governance on it. If you are using, we're thinking about deploying innovation, accounting system, that particular outcomes, that particular insight from the innovation accounting system needs to inform how you're going to go about improving your innovation system, being by upskilling people or, hiring other people. We're focusing in one area and not in the other, or deciding to go only for open innovation programs rather than internal innovation, whatever whatever's gonna end up being what's important is that that particular decision for improvements of your innovation system needs to be rooted in data.  Dan: (22:42) And that data can only come from the innovation accounting system. Financial accounting system can help. You can tell you what at the innovation accounting system is doing, but it's taking way too long for you to learn that. And, it doesn't cover everything. So this is why it's important to have an adjacent system running side by side. And lastly, probably again, an important principle to have in mind is that, whenever you're designing your system always consider the key success factors of your industry. Don't design a indicator system without understanding what it takes to win within that industry and starting from what it takes to win. Try to understand what are the indicators that are telling you if you are going to actually win. So it's very important to have that in mind when you build your innovation accounting system,  Adam: (23:39) That makes a lot of sense what you were saying about the principles. And as I'm thinking about that, and as we kind of wrap up our conversation, any initiative needs to be implemented by the people within the organization. You said that if there's an innovation accounting, it needs to be a company wide implementation, you know, so you have the one aspect of change management of getting that implemented, but then the other side of it, how are you able to take all these things that we're learning through different aspects and put it in a format that the leaders of the organization can read and digest? You know, like what, how are we looking at these KPIs or these KRIs and seeing how can, how can they digest those things? Because they have to see the big picture and understand is it actually working? And like you said, it may not, you may not see the results right away. It may take a little bit to see those results,  Dan: (24:28) Right. We usually try to keep things very simple. So top layer indicators for us usually revolve around, time being saved, money being saved, profitability being increased, and revenue being increased. That's it? Those, those four, yes, there might be another one, as I said around disruption. And how likely are you to get disrupted? Do you have a diverse portfolio? That's very qualitative if you want. Yes, it's a quantitative indicator, but it's very qualitative. You can't deposit that into a bank account, right. But what you can deposit in a bank account is profitability, is top line growth, is reduced time to market, reduced time to success. Those are things that obviously you can go and deposit to the bank, diversity of your portfolio, not really but it's good to have a check on that.  Adam: (25:25) So what about the change management and getting everybody involved? Because I can imagine that implementing this on top of everything else that somebody's doing can be overwhelming.  Dan: (25:35) Yeah, of course, no, this is not a job for one person. And, this is, definitely not a job for, for an intern or a summer student. You should actually dedicate a, a good amount, good amount of people to this initiative by good amount. I don't mean hundreds of people, but probably more like four or five people that are full time on this for probably at least a year, I would say, given our experience of having done this with, with banks, with engineering companies typically, yeah, it's like four or five people for about a year and you go going to have the system. But what's very important to remember is that you need to have innovation happening in your organization. You can't talk about let's create an innovation accounting system, but there is nobody working on innovation in our company.  Dan: (26:22) So if you are one of those companies that hasn't yet started the journey on innovation, I would encourage you. First of all, start your journey, do some mistakes, accelerate some teams, invest in the local startup community. Do those early things before you build the innovation accounting system. Innovation accounting is required for organizations that have been at this game for a good amount of time, three, five, even 10 years. They will have a need for that. Starting with innovation accounting day one is just going to be too much of a hustle, putting it together for very little benefit. I would encourage you to spend end that money doing innovation first, before building the system. Now, in terms of who's on the team, try to not having one sided, try not to have it stuffed only with people from innovation, because then they will tend to have an us versus them conversation whenever they refer to the people in finance or control. So I would encourage a cross-functional team that, includes people from HR, people from product, people from innovation, people from finance, obviously, you know, try to consider all aspects of what your organization is doing. Because innovation is not something that is done in a lab is not thing that's done on an island in the sun it's everybody's job. And, by being everybody's job, that should also be reflected in the team. That's putting together an innovation accounting system.  Speaker 4: (27:58) This has been Count Me In, IMA's podcast, providing you with the latest perspectives about leaders from the accounting and finance profession. If you like what you heard. And you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Follow Larysa Melnychuk on LinkedIn - https://www.linkedin.com/in/larysamelnychuk/ International FP&A Board: https://fpa-trends.com/fpa-boardFollow FP&A Trends Group on social media to stay on top of the latest trends and developments in the field:  Receive regular insights directly to your inbox (subscribe to FP&A Trends Digest here https://fpa-trends.com/newsletters)​ Take part in weekly discussions facilitated by a team of FP&A professionals (join the FP&A Club LinkedIn group here https://www.linkedin.com/groups/4855471/)​ Learn from experts in the field (you can watch our webinars and videos on YouTube here https://www.youtube.com/channel/UC03uGOGUAZTvcqR0PU3R0kg)​ FULL EPISODE TRANSCRIPT:Adam: (00:05) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host Adam Larson, and I'm here with you again to preview another insightful conversation about financial planning and analysis. Here in episode, 171, Mitch spoke with Larysa Melnychuk about trends in modern FP&A. Larysa is a leading FP&A professional and influencer. She held senior roles at top organizations before establishing the international FP&A board in 2013, which has since expanded to 27 chapters in 16 countries across Europe, the Middle East, Asia, Australia, and North America. In this episode, she discusses how FP&A has evolved and explained some trends, including XP&A and digital FP&A. Keep listening to learn more as we head over to the conversation now.  Mitch: (00:57) Larysa with your international FP&A board project and speaking with you previously, I understand you've traveled through many countries, 16 countries. There are 27 chapters for this project, across Europe, Asia, Australia, the Middle East, North America. You know, this is a wide covering project when it comes to the topic of FP&A. So you've obviously seen a lot. You've heard a lot. To start things off. I would like to first get your definition of modern FP&A, and how does it kind of vary across these different regions?  Larysa: (01:33) Thank you, Mitchell. first of all, thank you for inviting me, to this podcast. It's especially pleasant, to talk about, trends and FP&A at the beginning of the year, when we all look ahead, in order to understand what is happening, with our environment and with our profession. So, there are really a lot of definitions, of FP&A from, different account and boards from, different practices, practitioners. The one that I really love, it came from one of our meetings and, it was the definition, very practical definition from my former CFO at Swiss Re in Zurich in Switzerland. This definition he shared at our meeting and, actually he shared that his company really adhere to this definition in terms of their FP&A, so he said that, FP&A helps to manage the value of the company by five different ways.  Larysa: (02:38) First one is, helping to understand the value of the company, describing extraction steering, and reporting it to the key stakeholders. So fantastic definition that, really described, the strategic value of FP&A and how it helps to sustain the value of the company. Our FP&A trends definition that we checked at, 26, 27 different chapters in 16 countries around the globe. It's, that FP&A is a proactive force that helps to manage, the understanding of the business, the understanding of the value of the business. It supports a decision making process at different levels of organization, and also it integrate, organizational processes of strategic financial, and operational planning. It provides a critical, insights for the decision making. So this is my answer, what FP&A is.  Mitch: (03:41) That's excellent. And thank you for sharing, you know, I think in today's business environment, as we really try to focus on our management accountants, right, the finance and accounting professionals, you know, that definition must be top of mind because as everything that they're doing, today on the job, it really needs to be adjusted, you know, if not totally transformed because of the direction the profession is going. So to follow up on your definition and what you've shared from your experience, what are some of the trends and potentially some of the challenges really that go along with modern FP&A, as you define and supporting the transition in the evolution of the management accountants role.  Larysa: (04:24) First of all, the trends I defined, but this incredible business environment that we all experience. So, at the moment we are talking about applying and forecasting, in the environment of high uncertainty and what it means, it means that, our traditional management accounting methods, they're working only within this span of predictability, span where we can really, apply our, variance analysis method, one plan, one forecast. But, the problem, with a current environment is that the span of projectability is decreasing. So we really have to look at different methods, how we can plan and forecast, and make decisions under, uncertainty from this point of view, the first obvious, and very important trend that we observe, especially for the last two years, it's moving, not only to scenario planning, I would call this scenario management.  Larysa: (05:32) So everything at the moment, it's, about looking at, futures and deciding what is going to work. And of course, organizations that are able, to play, scenarios very quickly, practically in real time at different levels of the organization, really, with analytical insights, those organizations are at the leading stage and they really are at a good place. We looked at many different case studies and interesting to see that, practically every organization at the moment are trying to be there. But though, in order for us to be, at this, stage when, scenario management works in agile manner, we really have to look at, the way how to achieve it and, those stages, those next trends that I would like to outline here. They definitely, those important trends that are needed in order to be at this scenario management stage.  Larysa: (06:36) I would say that the second one and very important one, is driver based planning many would say, oh, we are talking about driver based planning. For many years, it's not the latest strength, but I would say that, at this particular environment we are talking about not traditional driver based planning, where you have all your defined and well known, drivers, but actually it's trying to look at those drivers, that, you never realize exist. And now we have to acknowledge that, they are helping us to define those drivers. So with help of predictive analytics, for example, we can define even behavioral factors, you know, how, behavior or expectations let's say of our customers will change the way how we do our business. So let's put it this way. A driver based planning that is at the next generation driver based planning that is based on identifying those key driver, 20% of drivers that can explain 80% of the results.  Larysa: (07:43) And also those drivers that, we never knew they existed, and, a lot of things happening now with external drivers as well, not only internal. So this is the second trend. The third trend I would say of course, is, digital FP&A. It's this, predictive prescriptive technologies that are transforming FP&A, it's artificial intelligence machine learning that helping us to automate things and also to take into consideration those things that we can't do with our human intelligence, you know, the full strength. It's FP&A architecture. What I mean by FP&A architecture is the combination of process and technology, how, FP&A can really help, to be this flexible and dynamic. Yeah. So how to, create this value chain, together with, combining both technology and process. And of course the fifth one, it's the role of FP&A digitized, we call this digitized FP&A business partner.  Larysa: (08:54) And also we have a lot of emerging roles, to the classical role of FP&A analysts, but we will talk about this a little bit later. Mitchell, those are trends if I'm talking about, the challenges, those are also quite interesting. The first one, I would say one of the biggest challenge, which is very obvious in this environment, it's, disconnect between strategic financial and operational plans in organization. Amazingly, 60, 67 organizations. They say that, they fail they're well formulated strategy, and only 2% of, leaders, are confident that they will achieve their, 80 or 100% of strategic goals. You see, and obviously, it's a big problem for organizations. And I would say that FP&A has the role to play there, through integrations, through using technology, through using cascade of drivers and so on.  Larysa: (10:01) Another challenge is, of course, reducing span of predictability, something that already mentioned the third one, it's a traditional budget and culture. It's still so much embedded in, organizational culture. You see, so all of those traditional plants, when people try to negotiate targets and allowances for the next year, not thinking about, that the environment is changing and of course, data, quality, data democratization put it this way. It's one of the biggest problems as well. And another one FP&A talent. It continues to be a problem to find well-rounded FP&A professional. And it's not only true here in the UK or in north America, but actually travel in the globe. I saw that it's happening everywhere. So those are trends and challenges that we see.  Mitch: (11:00) And you did a great job summarizing everything. Thank you. I know you mentioned briefly that we'll talk a little bit about them, later on in this conversation. I also know that we spoke before this recording, and we would love to jump back on again and dive deeper into some of these trends very specifically, but for today, we will keep things at a higher level and, you know, to get us to that next part of this conversation, I'd first like to take a step back, because when you first started your response, you talked about how some businesses are still operating with these, you know, outdated processes, outdated technologies, even FP&A cultures that are not up with where they need to today to adapt to these changes. So, you know, from your perspective, from your experiences, once again, in speaking with these professionals across the globe, what would be your advice on key steps that are needed to initiate this FP&A transformation, you know, is there a practical roadmap or a way for, FP&A professionals to lead and jump on these trends?  Larysa: (12:03) It's a great question. And before, I give my nine steps of FP&A analytical transformation or FP&A transformation, I would like to share with you, amazing results that we see similar results on our FP&A transformation, survey for the last four years. It started from year 2017. We don't see, the improvement, in the, percentage of value, activities, in FP&A teams, you know, so starting from year, 2017, the time that is spent on value and activity is only from 20 to 22% in the last four, five years. So it's amazing consistency that shows us that the things should be done, what could be done from the point of view of analytical transformation and in you that, we're all in new environment when we need, to play scenario management techniques, to be flexible and dynamic, to be, really very quick with the support and decision making. So, I would say that, even simple steps they would help.  Larysa: (13:20) And, I will, I'm about to tell you about nine steps that we defined at international FP&A board. But obviously it doesn't mean that they could be, should be in this particular order. They could be in parallel. It's a good age year to start at least from the first steps. You know, the approaches could be different. So the first one it's about analytical culture, the interesting thing that, if organizations still in traditional budget and mindset, sometimes they're not ready for this incredible change. So it's all starts from there. It all starts from the top, data quality, the obvious one, makes sure that, it's harmonization of data. It's, it's democratization of data. And many people say, oh, we have so many problems that when we fix the problems with data, we, it probably would be in the next three to five years.  Larysa: (14:17) I saw incredible examples when it could be done in parallel when, the short steps of improvement, they really make incredible difference. So just start and see what you can do, of course, collaboration, between different parts of organization, you know, between planning processes, key drivers, we already, talk about importance and the new age of, driver based planning, think about the key drivers and not those traditional that you always had, your models rely on, but those that are really hidden, we already talk about this. Many people would be, really surprised to see, how many hidden drivers are there, driver based model. It's an important one, implement the system, the six step, automate with team, as much as you can, it's quite easy to do, with the modern technologies and actually it's even not so expensive. And of course, create your scenario planning infrastructure, in order to, perform this scenario management and of course support decision making. So those are nine steps. But I would say that, those steps they're going in circle they're, always, may be in spiral. Yeah. So you are always after decision making, you adapting, your it's influencing your analytical culture. You are working on data quality and collaboration, key drivers, driver based model system. It's all working, in circle, I would say, yeah, with the improvement at every stage  Mitch: (16:04) Now, as we take these steps, and as you said, may not be that specific order. They may happen over and over again, because there are so many different trends and different things that you need to adapt to. I'd like to take this opportunity to then now transition, take a step forward into some of those trends specifically, going back to 2020 Gartner introduced a new term of XP&A. And I believe you mentioned that earlier. So I just want to get a little bit of a summary as far as what is your view on this, and is this something that's completely new, you know, going back to 2020, obviously we're now, a couple years out from the introduction of the term, but, you know, what is your perspective on what this means to today's FP&A professionals?  Larysa: (16:45) Another great question. Thank you. I would say that, definitely the concept that was introduced, it's not new. We observed this for at least the last seven to 10 years, and it's about the fact that, FP&A is becoming more strategic, and analytical, and it's, going beyond of just finance function. So this is the main concept of this extension that it's not financing in FP&A, is not the function just consolidate and operational and strategic plans, but actually it's doing this, it's collaborating and it's challenging and changing those. I would say that, other words, other definitions, that are similar to the concept of expanded planning and analysis. This is this, integrated FP&A where we have to integrate plan from different levels of organizations. And at the beginning of this conversation, I mentioned three important plans that we really have to integrate.  Larysa: (17:51) It's strategic, it's financial and operational. And if financial plan, this is our traditional role. Yeah. With, XP&A, we are going to strategic function. We are helping with strategic planning, and we connect in these to financial plan and operational plan and also help in operational plans, to realize through, one approach through, analytical, and driver based approach as well. So, and of course, it's all about, the technology. Gartner mentioned this, that it's about IML. It's about predictive and prescreen. Definitely. This is the world that is expanding at the moment, and we should expect a lot of things happening there. So this is my view.  Mitch: (18:39) Well, thank you. And, you know, I want to continue on some of these trends and things that you've mentioned previously. So in many webinars, different things that you've talked about, different things that, you know, the board and the project have discussed, digital FP&A I know it's very important to our audience, you know, our members at IMA, a lot of curiosity. So I'd like to get, your opinion on how AI, you know, artificial intelligence machine learning has changed FP&A specifically?  Larysa: (19:10) Oh, yes. We started to observe, the first strengths when, FP&A, started to use a IML, it's happened approximately, four and a half years ago. I remember, at one particular meeting in San Francisco, one of the board members shared the experience, how they started, to, experiment with a machine learning forecasting process. So from year 2018, we created, our non-for-profit, artificial intelligence machine learning FP&A committee. So, since then we, the number of meetings, all meetings are, a digital format. And, I must say that we looked, the members are coming from different countries and, different leading organizations, such as Maersk, Amazon, DWI, government of Ontario, Jaguar, all the Microsoft, Pepsi and many others. We looked at a number of amazing case studies and normally what we do, FP&A professionals and also some thought leaders.  Larysa: (20:23) We look at, the trends, how it's changing, where we are at the moment. What is the gap? The main conclusion is that definitely it's already happening. Definitely it's, creates a lot of opportunities, especially I mentioned to you that, we still continue to spend a lot of time in FP&A in non-value activity. Yeah. So one case of Microsoft, it's definitely, worth, looking at, we had several presentations from, Microsoft people, both in Japan and also in, America, in Europe as well. So in Microsoft, something that was done, by, many people within several months at the moment it's automated and done by, maybe one or two people with push of the button. So practically the revenue forecasting, and one of the biggest, company in the world, it's automated at the moment and it's automated to really, granular level.  Larysa: (21:26) And when people say that, oh, we are quite complex, we are quite big. It's not for us. It would be difficult to do this. I always say that if it's possible for one of the biggest company in the world, it's a huge, huge message to all of us. So, but the main conclusion is that, artificial intelligence machine learning matters, they create additional, opportunities for us in FP&A, because they release time, they allow us, to move away from that boring, firefight and, jobs, where we look at a lot of spreadsheets where data are not working, we really can move our profession to the next level, because our belief is that, it's artificial intelligence and human intelligence that really create, the best in class of FP&A.  Mitch: (22:18) Now, as we take a step in the direction of, you know, adapting to these trends and everything, you just mentioned, what it really means to the professional. I think our listeners need to really understand not just the concepts and the theories of what's out there, but what does it actually mean to them as an individual? So as far as, you know, the skills and the capabilities of today's FP&A professional, you just talked about it a little bit, as far as the technological skills, the human skills, but, you know, what should our listeners really be focusing on far as personal development when it comes to adapting to these emerging roles?  Larysa: (22:54) Thank you for this question. What I would say that, our traditional role in finance in management accounting is analyst. Yeah, we are really good analysts. We are, in FP&A we're really good at, model buildings in Excel, at understanding the main methods and all of these. But the reality is that our traditional role of analysts is expanding. So, really to be, at the age of FP&A professionals, we have to develop the skills, but at the same time, I don't want, to say to people that they have to become, data scientists and, influencers and, you know, they have to be programmers. It's not the point. What we have to understand that FP&A department, it's a multidiscipline department. This is department of different specialized roles and different general roles as well.  Larysa: (23:55) So, the T shape FP&A professional, it's quite a popular, subject at the moment. Isn't it? So the reality is that, yes, there are some emerging roles, and I'm about, to share those with you. We identified five key roles that should be at each FP&A department in order for this department to be a functional in order for this department to be a really effective in this incredible environment. But what I want to say, it doesn't mean that you have to have minimum five people in your department because people can combine roles. Yeah. And what I want to say that when you listen about this, please don't think that, oh, I don't have a chance because, you know, I don't have time, or I don't have capabilities in that particular role. It's about the team. it's about how it goes.  Larysa: (24:47) So, let us start from some very interesting, roles that we, identified at the marketplace. The first one is FP&A architect, emerging role, the role that previously, at least here in the UK was called system accountant. Or I can see that in the us it's called FP&A model, or in different countries it's means different things. But what I want to say that, FP&A architect, it's not only system accountant or modeler, it's much wider than this. So the term architect, so this is the building of, this infrastructure, decision making process that consists of, not only technology, but the process in order to make sure that we implement and the drivers from the raw data, it goes, directly to the systems to driver based model. the system analyze it, transform, is to decision sets where let's say storytelling, platforms, and decision makers.  Larysa: (25:54) They look at these at different levels. So obviously in order to create such, infrastructure, it would require, not only technology, but also the process. So FP&A architect is the bridge between IT and many other departments and the person who can do this. Yeah. So this is the first role emergent role, another role, we call this FP&A data scientist. It's not a classical data scientist with university degree in quotes and, so on so far, but this is the bridge between fine and data science function. So this is the problem of, today's world that, we have so many, different disciplines, and we don't have translators bridges between those disciplines. So, FP&A data scientist is someone who is skilled in using predictive technologies, such as IML to uncover those drivers and trends that will be used for the planning models here, but at the same time, this person can really translate, the land, which can be translated between in data science, world and FP&A world, other roles, that we identified, there could be more like from the IT side, of the shape, of course, FP&A storytelling, it's FP&A influence in particular influence and without the authority.  Larysa: (27:20) Yeah. So those are the roles they should be fueled. But please remember that depending on the talents and abilities people can develop in one of, or two of those, and always, could be at the age of this profession.  Mitch: (27:36) And, you know, lastly, now that we have introduced maybe some new trends to our listeners, maybe some new roles, you know, maybe the listeners have heard about these different topics, but need to know more, what are some additional resources that you would recommend as far as staying up to speed with FP&A, and everything that we've talked about today?  Larysa: (27:55) I would say that there are a lot of resources available at the moment. Yeah. And, I know that at IMA, you have a lot of resources that are so relevant for FP&A recently we started, to collaborate with your Institute as well at some of the webinars. And of course, I would like to recommend our FP&A website, where we have a lot of, articles and videos and, practically every week have, webinars and digital FP&A boards. You also can download some of the, papers that we do, research papers, survey, inside papers. And of course, there are a number of books. Some of them I can recommend, I really love, book by Steve Morlidge and Steve Player is called Future Ready: How to Master Business Forecasting. It was written some time ago, but I think it's a fantastic classical book, in order, to understand the forecasting world. Yeah. from my side, with my colleague, Michael Ko, we are writing a book that is based on the, results of the travel to 16 countries, 27 cities around the globe. Hundreds of meetings with FP&A professionals, looking at hundreds of case studies and actually looking at the trends around the globe. It should be ready somewhere this year. So it's another thing that I would like to share with people. Thank you.  Closing: (29:34) This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Alissa Vickery, Chief Accounting Officer and Senior Vice President of Accounting and Controls for FLEETCOR, joins Count Me In to talk about purpose driven leaders. Alissa has oversight of external reporting, technical accounting, and internal audit, and her leadership has helped FLEETCOR join the Fortune 1000 list and the S&P 500 Index. In this episode, she defines purpose driven leadership, the benefits and outcomes of developing purpose driven leaders, and why purpose is so valuable to the accounting and finance team. Download and listen now!Contact Alissa Vickery: https://www.linkedin.com/in/alissa-vickery-67b3986/References and Resources for Alissa Vickery and Leadership: https://accounting.cfotechoutlook.com/cxoinsights/how-being-a-purposedriven-leader-inspires-accounting-teams-nid-1672.html https://womenworthwatching.com/alissa-vickery/ https://alumni.uga.edu/2018/09/24/meet-alissa-vickery/  https://alumni.uga.edu/40u40/2017-class/  https://alumni.uga.edu/networks/women-of-uga/  https://www.bizjournals.com/atlanta/news/2017/07/12/see-who-made-the-university-of-georgias-40-under.html  https://tenthousandreasons.org/  https://www.relayexchange.org/  https://www.fleetcor.com/company/leadership/  FULL EPISODE TRANSCRIPT:Adam: (00:05) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host, Adam Larson, and we are now starting episode 170 of our series. The guest speaker you will hear from today is Alissa Vickery. Alissa is the Chief Accounting Officer for FLEETCOR, a leading global provider of global business payment solutions, headquartered in Atlanta. Alissa also serves as senior vice president of accounting and controls where she has oversight over external reporting, technical accounting and internal audit. Her leadership has helped FLEETCOR join the fortune 1000 list and the S&P 500 index. In this episode, she talks about purpose driven leaders, Alissa shares, many of her personal experiences and growth and development opportunities for aspiring leaders. So to hear more, let's head over to the conversation now.  Mitch: (01:03) So we were talking very briefly before we started recording here a little bit about leadership and there's, you know, a particular topic that we're going to focus on in today's conversation. I first want to start off by asking you who are purpose driven leaders?  Alissa: (01:17) Well, I mean, I think perhaps everybody has a different opinion here, but for me, purpose driven leaders are leaders who are really interested in powering productivity, both for the company as well as the growth of the employee. So, you know, everybody has a benefit from it, but I think if you can execute as a purpose driven leader, then you can ultimately transform some competent employees into super high performing stars of your management team and perhaps warrant their, their next progression into leadership, whether it it's at your company or into their next role.  Mitch: (01:56) So as far as what those individuals need, you know, I think a lot of people are always as working on their own leadership development, those who obviously want to climb the ladder, but as far as skills or key activities, that purpose driven leaders really partake in, what are some of the things that you recommend or you often see?  Alissa: (02:14) So, I mean, for me personally, I think it's been a bit of a journey, purpose driven leadership isn't on accident. It, you have to be the very conscientious of how the words that you use and the behaviors that you exhibit then drive behavior of your team. And I don't just mean sending an email, you know, 10 o'clock at night. I mean truly taking an interest in those individuals and their career progression as well as what's happening with them personally, because it is the whole person and remembering that these individuals, they are human beings, they have lives. And I think if the current environment has taught us anything, it's that it's not a one sided story, right? I think in the time of the great resignation, we, as leaders have been pushed harder than we probably have, in the history of our careers to try and make sure we engage at a level that's meaningful, that's personal, while not forgetting that individuals still want the progression, regardless of whether we're sitting in the office together, or we're still sitting, in our home offices trying to muddle through and get it done.  Mitch: (03:28) You know, that's a great point because leadership, and I've had a few of these conversations over the last, going on two years now, but leadership itself has changed right? Based on the work environment, everything else that we've experienced. You know, my next question, it could be a little bit more historical as far as traditional purpose driven leadership, as you've said, getting to know people face to face maybe a little bit more from the virtual component now, depending on your experiences over the last couple years, but when people are conscious and they are purpose driven leaders and they're in these efforts, what are some of the outcomes, you know, tangible or intangible, that, you know, the organizations that they're working for can really expect to see as more leaders are empowered?  Alissa: (04:12) Yeah, I mean, I think from, from my experience, it drives a culture where you have excellence, intentionality and discipline, and ultimately those trajectories will drive better results and more complimentary outcomes that support the overall business objectives that we're hoping to achieve as we try to execute on strategy as we collectively consider the projects that we take on, it's not just what happens in our department that that matters. It's, what's happening beyond that. It's what's happening beyond, traditional finance and accounting into the legal and regulatory aspects, the stocks compliance aspects, it's bringing it all together so that you truly understand the bigger picture so that when we go to execute as a broader group, that we truly are much more effective as a team. You know, I think you also fundamentally, if you are quite intentional with this leadership and with the cross-functional and working environments, both professional and personal, you end up with a truly authentic comradery, which I think ultimately produces a more loyal and effective workplace.  Alissa: (05:31) So, when I say loyal, I mean, you know, I've been very, very blessed that I haven't lost any key members of my team over the shorter course, which I'm very, very proud out of. I don't know if it's anything specific individually that we, that we do as a group, but I have to believe that acknowledging that we spend a lot of time together at the office. Right? And having things that we do as a group, sometimes silly perhaps, like dressing up for Halloween. So every year certainly pre COVID we had, we put together a slide deck actually, and come up with a theme for the entire group. And then we would encourage or coax or force individuals to participate outside of our team who were sort of like our immediate surrounding so that we could produce a really neat theme in terms of our dress up.  Alissa: (06:22) So my favorite one was we all did Harry Potter and it's a great group ensemble, right? And then another year we did the wizard of Oz, another great group ensemble. And of course, I always dress up as the villain, like I'm the wicked witch of the west, I'm Bellatrix Lestrange. And I embrace my role fully. And I think that human aspect, bringing that to the workplace and truly having fun with it and walking around the corridors here in downtown Atlanta or Midtown Atlanta and people seeing us dressed up as a group be like, oh my gosh, that's amazing. And, you know, I would tell you, it doesn't happen right across every group here. It's a handful of teams. And, quite frankly, it's something I look forward to every year. I think the team too, because this year we're like, do we dress up it's COVID year, it's sort of hybrid.  Alissa: (07:12) I said, well, if you guys want to come in, we're all for it. And so we kind of put it together that a little bit at the last minute. And you know, it's something we sort of all sort of enjoy doing as a group. You know, I would say that's one example and obviously, you know, doing holiday parties and being very purposeful about choosing times to be around each other, obviously, to the extent that we're comfortable doing so in the current environment, but having those meaningful opportunities to be around one another's, spouses or partners, because again, you know, I'm sure, my husband hears about my teammates and coworkers all the time. And so it's really meaningful, I think, to bring him into the fold. And I have to believe for my team members and our broader finance group, they feel a bit of the same way. So it's really nice to be able to bring everybody together and, you know, have a festive beverage and celebrate.  Mitch: (08:05) Thank you for sharing that. Those are great examples. And you know, it's funny because our team here at IMA specifically the education team, Halloween's a big thing for us as well. You know, it's, I have young kids, so the last couple years I haven't participated, I've been home with the kids, but I know our team, they dressed up as, everybody on the team was Flo from progressive.  Alissa: (08:28) Ah, so good.  Mitch: (08:29) Men and women alike. So, you can imagine the fun that they had with that. And there have been a couple other things in the past, as well, but I appreciate you sharing that because you know, I posed the question from an organizational perspective, as far as the benefits, I did want to follow up with taking a step down and taking a look at the team function, you know, so you certainly address that. I do want to just get your opinion on purpose driven leaders, getting to know their team, but also empowering them to become leaders of their own. Maybe it's succession planning within the organization, you know, maybe it's for their own personal development as a purpose driven leader. You know, like I said, just a quick follow up. How do you kind of balance that, you know, understanding that empowering others and creating new leaders? It actually, I don't want to say hurt you, but you know puts you in a tough spot, down the road.  Alissa: (09:21) Yeah. It's not untrue, right? Your objective is to help people grow, whether that's professionally, personally, truly understanding what their goals are and their objectives and understanding how all the pieces come together. I think having a sincere level of empathy for where they are, because everybody's at a different season in their life. You know, some have grown kids, some have no kids, some have young babies and where you are personally oftentimes drives the level to which you can press the pedal. I have a team of all women, which I kind of love, that wasn't on purpose. It was just, you know, it is who was the best fit for the role. But I think it's created this really unique environment in which we're sort of all there for each other, certainly professionally, but on a personal level, you know, since everyone is in a bit of a different season, we're there to support each other in a very unique way.  Alissa: (10:22) But back to professionally, it's having that empathy and truly understanding what people's objectives are and understanding that those objectives may change over time. And so when we're setting, our professional bonus objectives for the year, which are often times project and initiative driven, the first question I ask is, what is it you want to accomplish professionally over the next one to three and then three to five years? Is there something you want to go work on as part of setting this, these objectives that would help you get to that, those ultimate longer term or midterm objectives and what can I do to help you? And you know, it's funny if you don't ask that question very often and then you ask it out of the blue, like people are almost taken aback sometimes. It's something I will be honest. Like I've not always been great at it.  Alissa: (11:14) I've had to work on it. I have my own professional coaching that I go, that I work on and go through and to try and ensure that I'm focused on the right things that I identify my own blind spots so that when I bring that to the group, as a leader, that I'm helping them to, I'm almost like, what do you call it? Sharing and passing it down. Right. Because I don't want to be the only one that benefits from the fact that I've had this leadership development training. I want them to participate in it and go the next level or, pass it on. Right. And encourage them to think about what incremental credentials you may want to gather or what additional classes that you may want to participate in that will help you along your path to ultimately being, I don't know the best technical accountant or, Hey, I want to become a certified stock comp expert.  Alissa: (12:10) So what, what are those incremental things that I can do to help support your career? And then also gauging, you know, what is your satisfaction level right now? And again, the answer changes every time you ask. So I ask you about once a month, but, where are you professionally and personally right now on a scale of one to 10, 10 being a, I'm so excited that I'm doing cartwheels down the hallway, one being I'm crying in the fetal position. Right. And, you'd be shocked how those answers one shift, but two how much one will impact the other. Right. And so I think it makes the personal aspect, that much more vivid, but I think where your question started, and I apologize if I've gone on a tangent is how can I end up ultimately it's obviously a benefit, but it can produce an outcome where you lose an individual.  Alissa: (13:07) Right. so I had this one woman who worked in my group for the past seven years, an excellent employee. She was someone I could always lean on and look to, if I had an issue, I would pose it to her. She would break it down and then she would go execute. And then she would come back to me with all the things that she had discovered and work through. And then she would, you know, she asked me yeah. To provide her feedback along the way, obviously, but she was just someone you could count on. I knew from, I would call it halfway through our first year, working together, performing this kind of project work was perhaps not her passion. Her passion really was around fraud examination. She was a CFE by trade, had done this in her past life.  Alissa: (14:04) I had the benefit of picking her up as a team member through an acquisition. And so we sort of shifted her role, but ultimately her career objective was to get back into something more attuned to fraud, examinations, underwriting, credit risk. And ultimately there was a position internally that opened up, where she was obviously the right person for this role. And she brought it to my attention said, Hey, I would like to consider this opportunity. And I said, I think that's great. Why don't you tell me more about it? Tell me about the leader. Tell me about what it is you're hoping to achieve with this. And when she explained it all I said, I think you should go for it. And so she interviewed, she talked to the process and then she came back to me and she was genuinely, I said, has mixed emotions, right?  Alissa: (15:07) Because I think she truly enjoyed working with our team. She truly enjoyed the opportunity. She had to grow in FLEETCOR. After she had talked to the executive, hiring for the role, she came back to me with extremely mixed emotions, because I think she has genuinely enjoyed working with our team, the growth opportunities it provided for her. And I would say the amount of institutional knowledge that this woman has over how things work. And this is something that I cannot stress enough and is so hard to replace like seven years in an environment with, you know, a highly decentralized business model with leaders all over the world and knowing who to go to for whatever they ask is. And I just told her, I was like, I think that you're gonna regret this. If you don't take it. I think that this is the one you've been waiting for.  Alissa: (16:04) And she goes, but I'm going to leave you in a little bit of alert. I'm like, it doesn't matter. I was like, we'll work it out. And so a little bit behind the scenes, you know, I'm talking to the other executive, obviously I'm like, there are certain things that can't drop, and you know, working through the transition, but, you know, I'm so proud of her and I'm so proud of the story for our company, because I think building a culture where you help people achieve their ultimate career objectives, or at least their next career objective, right. I could have lost her to any other company outside of FLEETCOR, but finding a place for her here, where she's able to use the value and the institutional knowledge she's built. And quite frankly, the rapport she's built throughout the organization and taking it to this new role where I know she's gonna be a superstar and already is, I'm just, I'm so proud of us for, for making it happen. I really am,  Mitch: (17:01) Good for you, you know, personally. And from my perspective, and I was going to say, you beat me to it. It's a great story, because oftentimes you hear things like this, or maybe you read about it and you can't make that personal connection. So how true is it really does that kind of leader really exist, who is going to give me that opportunity, but to hear that it happens, you know, it gives people an idea of, you know, there's the old saying, people don't, you know, just leave jobs, they leave managers or they leave leaders or whatever it is. So it gives you an opportunity to really, you know, aspire if you are in a situation to find somebody who supports you like that along the way. So great story. I appreciate you sharing that with us. And, you know, I think, like I said, we going back a minute, we started at the organizational level, then the team level, now we're kind of talking about the individuals really breaking it down. So as far as from the individual now moving forward, what does an individual, you know, really need to do in order to become these purpose driven leaders? And, you know, I know you mentioned some leadership coaching and development. I don't need your personal specifics or anything like that, but you know, some things that maybe people should be aware of that they could, you know, take a look in the mirror and focus on.   Alissa: (18:13) Right. Well, and so may, maybe I'll take a minute to rewind and just kind of give a little bit of my background and perspective, just so that it, because I'm sure there are leaders out there who rationalize and work through things in a similar way. But I spent almost 10 years in public accounting at, two of the largest accounting firms in the world and the amount of professional growth opportunity. And I would just call it forced training and forced personal improvement that those firms encourage you to go through if you plan to progress. And I would say having natural progression, it's funny how when you leave that environment and come to the private side, trying to replicate that is quite difficult and, kudos to the professional services firms for the programs that they've established. But I came from those big firms and effectively was a department of one when I joined FLEETCOR in charge of quite a bit.  Alissa: (19:14) And just trying to get it done. And so I think sometimes we as professionals go through seasons where we sort of forget all of that mentorship and training that we received along the way and it's good, bad, and different, we've become a product of our environments. And so for me as FLEETCOR has grown into this S&P 500 company and inherently has grown our groups and departments and teams, to reflect the risk and size appropriately pivoting back to sort of where we came from. And remember, you didn't get here alone. You didn't achieve the level of success nor the level of executive presence and the ability to execute on really hard stuff, quite frankly. And so making sure that we're building teams up and mentoring those individuals and finding their niche, because when you go from a departmental one is something much larger and trying to identify the right resources.  Alissa: (20:17) Like I'm always trying to hire my weakness, because I know fundamentally that person brings something to the table. That's more than I can offer. And so they have something to teach me was I certainly have, I'll call it the executive level mentorship that and bring to the table and hopefully help them to grow as well. And I think fundamentally, if you're able to do this effectively, you're likely to retain your employees. You're likely to organically help identify what those opportunities are for their growth. And then fundamentally I just produce an output that is that much more meaningful that people feel like they actually were part of something and they did some really solid work and it wasn't just for, you know, the big company, but it was, it helped them grow as well. Right. So always looking for those opportunities for growth.  Mitch: (21:09) Yeah. You know, it's a great point. And I just want to, you know, kind of jump ahead and wrap things up a little bit, by tying it all together, really for our listeners and everything you just talked about as far as, you know, identifying gaps and, and trying to, you know, coach people along the way, particularly, or specifically to accounting and finance, the profession itself has evolved so drastically, you know, over the last few years and everything that's really impacting individual roles and the need for training and coaching and upskilling and reskilling as far as purpose again, and going back to purpose driven leadership, you know, what is specifically about purpose that's so valuable to accounting and finance professionals, you know, what is it that purpose driven leadership can really prove to be possibly the difference as the profession continues to adapt and identifies new needs and skills along the way?  Alissa: (22:06) Yeah. I mean, I think we're all forced to constantly evolve, as you said. And I think being purposeful with how you approach those changes and providing individuals, the opportunities to really soar, and grow, and quite frankly, provide them the opportunity to share new ideas, voice concerns when something doesn't feel or smell right. Ultimately an enhances our company culture and the business strategy for driving growth. I think if we learned anything over the last couple of years, it's the more things change the more, the ability to pivot and the skillset of being able to pivot is super valuable. And you know, you fundamentally grow a group, with incremental heads, but, being able to create growth opportunities for those individuals with those new requirements. And I have to say, you know, having an open door policy in terms of being available and just giving individuals the opportunity to speak, because I do think that we become a product of our calendars, whether we like it or not, especially in the Zoom driven world, which is necessary because we're hybrid, but it's created a back clog in terms of, availability is what I would say.  Alissa: (23:34) We're all trying to get certain things done every day. Sometimes meetings are part of getting it done. Sometimes meetings are just meetings, right. But I do intentionally try to make sure that if it is not immediately a big need, that if somebody need, if one of my team members needs me, I will step away from the meeting and have the discussion around whatever it is. Whether it's, you know, helping them to move to the next phase of a project address, some bigger concern that they may have. Right. And just trying to, to be the leader that I would wanna have, or that I do have now. And so being cognizant that we all need that.  Closing: (24:20) This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Michael Teape: https://www.linkedin.com/in/teapetraining/Teape Training International (TTI): https://www.teapetraininginternational.comGet my FREE eGuide 7 Best Facilitation Tips to Ensure Engagement & Learning to ensure your Online Training Success -> https://tti-signup.ck.page/eguideFULL EPISODE TRANSCRIPT: Adam: (00:04) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host, Adam Larson, and you're now listening to episode 169 of our series. Today's featured guest is Michael Teape. Michael is the owner and lead training consultant for Teape Training International. He is a thought leader in people development who brings over 25 years of corporate learning and development experience across multiple industries. He enjoys running the trainer events for facilitators globally, and works with senior leadership teams to improve their working relationships and outward facing impact in the organization. In this episode, Michael focuses on time management and building a culture around working smarter and focusing on productive work. To kick things off Michael addresses, how you can win back one whole day of your time per week. So keep listening to hear more as we head over to the conversation now.  Mitch: (01:07) So one of the things that, I know you really talk about is how to win back one day of your team's time every single week. And when I read that at first, I thought that was pretty ambitious. If you break it down, we have accounting listeners, 20% of the week is free.  Michael: (01:25) You know, I knew you'd be talking about figures, Mitchell since we got started.  Mitch: (01:27) That's right. So, you know, I just want to know your perspective on this. How do you go about achieving such kind of time management?  Michael: (01:36) Well, there's multiple streams of how you do that. And yeah, people are like 20%. They always raise their eyebrows when I say that, but truly there's a couple of things you can do. And you know, we work on, first of all, are you actually efficiently working the time you're in the office or the time you're working at home, you know, working on a strategy or, you know, a piece of technical work. In an hour, you know, how effective are you? So I ask everybody, including your listeners. The one question is, how effective are you in that hour? Are you really being productive? And I've got it down to under, I can do in 20 minutes to 30 minutes what you could do in an hour. You can get that down to half that time. If you focus, you know exactly what you're working on and you're in the zone, you're just thinking about this research.  Michael: (02:34) You're just looking up the strategy. You're just crafting it. If you're not interrupted by the noise of the world, emails, iPhones, Androids, there's just so much going on. People interrupting you all the time. If you create a bubble, it's amazing what you can write in 30 to 45 minutes. So that's one of the biggest parts of it is can I get more out of an hour? And I guarantee you can. So focus, good planning, prioritizing, knowing what you are doing for that 20 minutes. And then the other part of it is brain chemistry. So is understanding how you work. You've heard the thing you've probably heard before. What's your best time of the day, or people often say, oh, I'm best mid morning, evening. They'll offer that quite freely. So they know they're thinking about it. And it's using those times to do your more difficult work.  Michael: (03:35) Your more heavy thinking, research work. And then using the times, you know, you're not sufficient actually doing something that activates your body, something either physical or the boring, easy work, replying to emails. We'll talk, I'm sure we'll talk about emails. Everyone's always got a question about, that's a whole subject on, how do you look at emails? How do you deal with them? You've got a think of it as a strategy. So there's so much you can do even. So if you're working with others as well. So that was individual. If you're working with a team, is how effective are your meetings? Most of the startups that I work with, they never hold a meeting more than 30 minutes. Yeah. So you can imagine, even with their clients, they've got their clients in tune. We get into the conversation. We're 10, 15 minutes in people start getting really serious, real quick.  Michael: (04:27) They get to the point. And if we need to book some more time, what's it about we're going to do that. So rather than letting a meeting roll on and on and on, I don't recommend that if your first meeting a client, you know, from this strategic point of view, but once you've got to know a client, they will appreciate the fact. You can get things done in half an hour instead of an hour. So you you're shaving time by getting more done in the time. And where does your team spend the time together? You don't need to attend an update meeting. It's just a waste of time An update meeting is just somebody else reading out what you could have read on a document and in an email. It's what are we going to do with it? Let's cut that. Did you all get the update?  Michael: (05:10) Yes. Great. What are your thoughts on it? Boom. I've just shaved 15 minutes of time off your meeting, right? So there are so many different aspects to it. And I, you know, the overarching piece, I would say there's three things to consider. One is your mindset. So knowing what's going on here, how you approach work, you've heard growth mindset and fixed mindset. So that working on that piece. So you're connected as quickly as possible to your work. Secondly, is choosing goals, productivity tools, organization, tools that work for you for your work. And you personally, there is no point using tools that you is hard work for you, or you don't get, feel excited to be using. I know I used, excited and organizational tools in the same sentence, but without that, you've got to pick tools that gonna work for the work you do and suit you personally.  Michael: (06:09) And, and lastly, get good about your time and your rituals is rituals and routines are fantastic. If you can set them up to you rather than let them happen. So if you finish a piece of work today, all of your listeners, next piece of work, you finish, focus on what you're doing afterwards. What are you doing? Do you just sit back? Do you look at the phone or are you actually okay. I'm physically taking a couple of minutes, then I'm going to get into my next piece. I am going to get up, walk around the desk, grab a coffee, change my mood, get some energy going and boom, straight back into it. Cause I guarantee once you finish one piece of work, oh, yeah. You're like, oh good. That's over. And then you waste a good amount of time, relaxing, pat yourself on the back, subconsciously looking at your emails before you get into to the next piece. And before you know it, you've lost time as well. So do you see from that, just that alone, you're able to save 20% of your time and your team's time. Yeah. Just in those areas there.  Mitch: (07:12) That's, it's very interesting. And you mentioned a lot of things that I did want to bring up, through this conversation, but it kind of all ties back to this, you know, this old phrase and everybody's heard it, everybody's used it, you know, you want to work smarter, not harder. And it sounds so cliche, so much easier, you know, said than done for many people, I believe when it comes to time management. So as far as working smarter, you know, you mentioned some tools potentially, or just mindset, but you know, best practices, you know, maybe just going a little bit deeper into what you talked about, how can people really work smarter and not harder to be this, you know, to save this 20%?  Michael: (07:54) Yeah, Mitchell, working smarter, not harder is a cliche and everyone goes, oh yeah, work smarter not harder. And then they nod their heads and then they walk off and have no idea what you meant. It's like, OK. And they go back to doing what they did before. So you need something that's going to stop you from going back to just randomly looking your email. Cause you've got the email flashed up, you know, a notification came in, a notification from your calendar. So you need some kind of planner, really. You need, a planner for your mindset at the beginning of the day. I use the one I recommend to get you in the right mindset of really wanting to drive a business forward. You know, if you're designing strategy of your business, right, you're a business partner, you're building a business.  Michael: (08:42) You really have to be like, right. I'm here for a purpose. And I use the, High Performance Planner by a gentleman called Brendan Brushard. He's one of those life coaches. He's like Tony Robbins level, can be a little bit too enthusiastic. I'm just kidding. But his tools are fantastic. And I have it right here on the desk behind me, my planner, and what it is is, it's an old fashioned planner. You open it up, but it gives you some focus around, you know, what your mindset for the day, my purpose. You know, I can actually just give you an example, I suppose, just right here. Why not? You wanted practical - morning mindset. You know, what's a one thing I can get excited about today. Those kind of things. Thinking about someone who needs me to be on the A game today. One bold action I could take today. To see these are all getting your mindset into a, doing forward state, ready to challenge the day.  Michael: (09:45) And you know, in that you should really be looking at that before you start any of your work. So if you know, you're going to be busy at nine, I've got some bad news for you. You need to up before that, if your meetings start at nine, you need to be starting a little bit earlier to get yourself right, ready to go at nine o'clock. So that's one of the things, or whatever time of day you start. And then at the end of the day, you need to create some kind of ritual because you can't be on all the time. You know, we get stress, you hear burn out, particularly during COVID. You know, we don't have enough people now working for us. There's a recruitment disaster around the corner. Using strong words here. But at the end of the day, is that okay?  Michael: (10:30) How do I switch off quickly? In order to get to my own personal work or whatever I need to do, fitness, whatever it is, and you need something that's going to close it off. So a reflection tool is what you need and the high performance planner has that built into it. And, that talks about, well, what look back on the day, just for five minutes, what's a task that I handled really well, who benefited from a discussion with me? Who did I get energy from? And there's a scorecard and productivity and all those wonderful things. So I do this myself. And I'll be honest. I don't do it every day, but I do it at least three times a week. And the energy I get, gives you that that mindset, but then you've got to use a practical tool. So that's a mindset tool, and there's lots of them out there.  Michael: (11:24) You can look up if you just Google them, mindset tools, and daily set up, you'll find those. But the other one is, actually the work you're going to do. And you need some kind of one pager, like a productivity planner. And that will list out quite simply what the main things that I need to get done strategically. And then you can work on the next steps, like, okay, what are the five key things I need to do in order to achieve that overall objective? Because these are what they call big, hairy goals. They're like, Ooh, you look at it and go, oh yes, I must do my business strategy. And on my five year target and increase business by 50% next year. Sounds lovely. I'm going to go and get a cup of coffee. Thank you. And then I'll look at my emails and I'll do something tactical.  Michael: (12:10) Because I have no idea how I'm going to achieve that. So productivity planner allows you to break it down into tasks, chunk it down, and then you can prioritize what you're going to do today. Put it on a planner, put it on your calendar as if it was a meeting. So this half an hour, I'm going to be working on X because I know that's an action plan to get my big goal achieved and not overloading yourself. There's so many tips in here, Mitchell, that I'm thinking of, but that's the thing, not overloading yourself with 50 things to do. Pick five solid things that will make a big difference to your strategies that you're trying to build for the organization and leave time for the personal stuff as well. So they're the two things I would work on.  Mitch: (12:57) That's really interesting. And thank you for sharing the names of the tools. I think that's certainly helpful. You know, I do some similar things, but you're giving me a lot to think about as far as how I can improve and take that to the next level. You know, one of the things we've talked about already, and we're all guilty of it, but as far as you know, just some of this busy work, you know, we see these emails come in and it's got to be important. I have to answer it right now. When in reality, it's kind of taking away from that productive work that you were just probably in the midst of doing so as far as that problem goes, how do you go about implementing some kind of solution to really chunking the time? And you know, we can address the email dilemma or really, you know, I think a lot of it is as you said the iPhones and the different social media and the things that are always at our fingertips. So how do we solve that problem?  Michael: (13:52) Well, there is an addiction problem with having your phone tell you whenever you've got an email, tell you whenever you've got a meeting and what next on your calendar. So you've got all of these messages coming in. I challenge people to switch them all off. Switch it all off. Yeah. Don't have notifications coming in instead set times when you're going to check your email. Yeah. You don't need to check your calendar every five seconds. Yeah. If you're thinking, oh, what have I got this, check at lunchtime. What have I got this afternoon? Next three hours. Yeah. Check in the morning. What have I got coming up? You should, it's in there. You don't need to know it every time one of your meetings pings up, it just interrupts your thought process and emails are the same. So I, whenever I suggest particularly email to executives, switch off the notification, they're like, well, what if somebody wants to get hold of me?  Michael: (14:48) They go straight to this panic stage of like, whoa, whoa, whoa. It's very important. Yes. I know it's important. And I know business is very important. However, we don't need to give an instant response. So a way of dealing with this saying, okay, I will check email at certain times throughout the day. And start small, you know, start like write down. Okay. time now for arguments sake. It's 2:00 PM now, right at the top, 2:20 email on top of whatever your notes, you got tiny little thing at 2:20, I'm going to check the email, switch it up, close it down, switch off notifications. And that's how we stop getting the busy. What are it is, is email is nothing more than a place for other people to put their priorities on you. That's all it is. We should be using email for two things.  Michael: (15:42) And two things only. One is looking for who we are waiting for information on to help us complete our work. So if I'm waiting for someone, you know, I go into email just to check if I heard back from this person, this person, this point. No. Okay. Do they need a chase? Send them a quick chaser. Done. That's one use of email and the second is to see when new work comes in or updates come in. So when new pieces of work come in, you put them on your prioritization planner, you look at how you're going to fit it in. You're booking some time to look at it, if it's a big project. Yeah. And there's some great work by, for that kind of stuff, by Dave Allen, have you heard of, Getting Work Done? He's been around for many decades.  Michael: (16:28) Yeah. And, he's got some really good tools I have to say. And I'll use a lot of those executive tools and all different levels in that, but you've got to be prepared to make a process. Your day has to turn into a process. So, you know, email's a real problem. Because you just start answering an email and then you're answering the next email and you get tired and you're like, oh, look, there's a special offer for a case of wine or a golfing adventure, you know, whatever. Oh, and then you look at it and you click on the link. You look at the page and before, you know, it, you're dreaming about going to California pebble beach or something on this all inclusive resort, and play some golf next summer. You know, you wasted, your focus is completely gone and you've also wasted physical time. So you see where I'm going with that? It's, you got to make it a process. Otherwise it doesn't work.  Mitch: (17:27) Absolutely. It makes total sense. And like I said, posing the question. I think we're all guilty of it. I think we can all relate to similar situations probably sometime this week, if not today, but you know, just kind of taking a step back, everything you're talking about, as far as an individual goes, it certainly makes a lot of sense. And I think you can improve a lot of your own personal time management using some of the strategies you've shared, but I think there's also a team component to this that needs to be addressed. Right. You know, if one person is making progress, but no one else is respecting that progress. You're going to be fighting a little battle here. So what is your recommendation as far as, you know, maybe as a leader or as an individual contributor, who's trying to shift the culture of the team to, you know, support these initiatives. How do you go about doing something like that?  Michael: (18:20) I think that the culture is hugely important across the team. Hugely important. Because with, like you said, if only one or two people are not doing this well, then it all falls in. So one of the techniques a leader should do is to bring the team together and agree what, prioritization tools or communication tools we're going to use on a project, or, getting a list of clients together. You know, this is the systems we're going to use. This is how we're going to go about it. And another thing is to get them to brainstorm together, ask them about, in order to achieve whatever it is the strategy is we need to have done X, Y, and Z. So we need to have worked out whether this real issue for our clients, what the competition is doing, updating our lists, getting a communication message.  Michael: (19:14) So all of those tasks, but what I asked you to do as a leader to get the team together, to brainstorm and think, well, these are all the stages we need to do. Get some kind of ownership on a bigger project that everyone has a part to play. And they understand this is our process. And we are going to put, times and dates and people's names to it. You know, there's Racy is one example of a project management tool. You put people's responsibility, who's accountable for it. Who's responsible for getting it done, just to get them all on the same page. Now it may seem your wasting time to start with, but what you're doing, you're setting up to save time through the rest of that six months, where you're trying to build a business. Where you're trying to get more partners involved, a new system in place, a new marketing approach.  Michael: (20:05) You can imagine that if you don't have the team on the same page, so that's one thing highly recommend that you do. The other thing is that is making sure that if you are not the only person doing work on yourself, about how you stay productive mindset, manage your time is share that with everybody. If you are leaders, share, look, this is what I'm doing. And talk about expectations. My expectation of you is to also look at your work and how you're performing. So you don't have people sitting in jobs thinking, well, it's okay. I just do the standard set needed, as a management, as an accountant, you know, those, I don't just do that. I know that my expectation is to contribute and grow this business, make it more efficient, easier, automation. There's so much automation out there, for this type of industry, as well as how we communicate emails, you know, how you can get a VIP list so that people you're waiting for it highlights and tells you that.  Speaker 3: (21:09) But he won't tell you about all the other rubbish that comes into your email box. So sharing those ideas and asking the others, well, what are you trying? What are you doing in order to be as productive as possible? Sharing the thought, I thought about cutting meetings down to half an hour. What do you think? You know? So yeah, if you're gonna have a team meeting anyway, cut out the updates. I expect people to read the update, comment on that and then spend some productive time how we're going to work together to be more efficient. So, yeah, and I do a lot of training bringing teams together. Lots of models on this and the thing is, do they have clarity? Do you have a consistent tool they're using? And do they have a consistent expectation that they know that the expectations then is to drive things forward, not just do the X number of clients in front of me and then do it again next, next year.  Mitch: (22:08) You know, I'm at this point, just thinking of everything that goes into time management and prioritization and everything we've talked about. And I feel like the conversation can go on and on, different strategies and solutions. But, you know, I do want to bring this conversation to a close and I'm just thinking about other challenges that I know our listeners are facing. And really just everybody in the world at this point, anybody who has had to adapt to this hybrid workplace, right? Whether it's working, fully remote or back and forth, and you know, that work life balance with your personal lives right behind you during office hours. So everything we've talked about so far now add in that personal side of things, you know, what are the expectations that we really should have and how do we, what kind of solutions or best practices are there for really balancing to make sure that we stay productive or utilizing our time wisely? But we're not dismissing, you know, some of the other priorities that we have as well.  Michael: (23:11) Look, in the olden days, I say in the olden days, you used to go on a commute, right? We used to go into Boston on the train or New York or whichever city it is, right? We'd have time to disconnect between personal and work. Okay? Now we are remote. Now that has huge benefits and I'll mentions some in a minute, but the worst thing is there is no commute. There's you open the door and there's the dog, there's the family. Hi. And if you're like me, I've got an 8 and a 10 year old, they tend to come in, knock on the door. If they have something, they need something. And they're working in a virtual classroom, as one of my kids is this week. They'll just open the door and come in. You're like, ah, okay, so what I talk about really a lot is, building in a switch off.  Michael: (24:00) And what that means is you don't have the commute anymore, 30 minutes, hour commute. So you have to build a fake commute. And that is three things. That's the, we're closing the closed list, the closed off and the rituals. You need three things. So my recommendation is when you're coming to an an end right, I'm done is to write down five things that you must do tomorrow. That will go on your productivity planner that I talked about earlier, the, as your priorities, what's the five things I must do tomorrow. And there are five things. It's a closed list because once I've written that down, that has to be done tomorrow. Okay. So it gets you focused on what it really helps you focus the mind on what the priority is. If you get to tomorrow and that close list, something comes up as urgent.  Michael: (24:51) That's fine. But you have to take one of the five items off of your close list and put the new one on. Okay. Don't increase to 5, 6, 7, 8 list. That's burnout. So five is a lot of things you need to check. So it's called the close list. I've written down this list, it's closed. That's what I'm going to do tomorrow. Fine. It helps close it in the mind. The second thing is to close off and the close off is to switch off all the lights in your little, whether you've got a closet is your office. You know, you've converted a closet or you're actually using guest bedroom. You're lucky enough to have your own office space like mine, is to go around, right? Switch the lights off, turn off the printer. If you've got one, anything electronic, physically switch things off, close down windows on your laptop.  Michael: (25:43) I know this is crazy, right? My wife and I, we've got very used to it, working together. Just leaving stuff up that we're going to come back to. But no, no. Now we close it all down. Close everything down. Close that laptop. Lid shut. Yeah. So you're getting a thing. Everything's closed down, put everything set up. Things files away, filed away. Okay, I'm ready. I've got what I need for the first thing tomorrow. I've got my closed list. I open that door. I close that door. My mind is now free. Now the last of those three was rituals and rituals either own you or they work for you. So rituals and routines, right? We've all got our own little routine. Our way we like to go set in place. We go for a coffee. Are you a Dunkin Donuts person, or you a Starbucks person, whatever's in town because now you're at home.  Michael: (26:34) So there's a different set of you don't have it around the street corner anymore. You have to go downtown for it. and it's they can own you. They suck up time routines like, oh, I'm just going to go and do this that, before you know it, half an hour's gone. But what if you owned your routines and they became rituals. So if you had, you finished your work. One of my recommendations is when you go to virtual work is you put on a shirt or something that you wouldn't be wearing just to lounge around the house. So there's so you can change that shirt and put your Netflix clothes on. Yeah. Or your Hulu clothes, whatever is something a bit more comfortable, more relaxing. But the mistake, a lot of people is they get up, they put on their just home clothes and go and sit in front.  Michael: (27:24) It doesn't feel different. And even people who have got big meetings, virtually tend to go and put their shoes on. Again. Don't walk around in your carpet slippers, put your shoes on because it gives you that feeling different. Imagine that at the end of the day, you're changing your clothes. You would do that anyway. If you came home from the office, so I'm recreating these, become rituals and a ritual is something your routine you do regularly. So going to the gym is not a ritual. If you're only doing it once or twice a week and you might not do it next week, all right. It's ritual because it's consistent and walking the dog is a ritual. Do you, when you finish your work, what do you do? Well, I'm going to walk the dog or I'm going to walk around the neighborhood or I'm going to go and talk to my better half, partner in life, friend, family, and make something specific.  Michael: (28:19) Whatever that ritual is. Doesn't matter. If something that's important to you do it, but do it every time. Yeah. And, and make time to read something that you are interested in. Preferably, a paper version, like a book, a proper book. You know, we heard of those. We use Kindles now, we use electronics. But what I'm trying to do is close down the minds as quickly as possible. So if there is something you can read physically, or you printed out something, you wanted to read a personal article, spend five minutes, reading that, boom, your mind's out of it. So out into the next world, OK. Equally in the morning, you've got a startup routine that I talked about earlier. You know, the high performance planner is one I use, you can use whichever one you want to get you in, but you need to get out as well.  Michael: (29:04) So when you walk down the stairs, you are not worrying about where am I going to find all this money? You know, these big projects that didn't go so well. Because you had a switch off routine. So that's a closed list. Write a closed list. closed down, physically close down the electronics lights, tidy up your, your work station area. And then a ritual. Something like walking the dog, getting your Netflix clothes. You can play a bit of music. It could be anything you want it to be, but it has to be done every time. And that's how you get in and out really quickly from work to personal. And then back again.  Closing: (29:46) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's web at www.imanet.org.

Mark Marmon, VP, Finance Transformation at RGP, and Janis Parthun, VP, Advisory & Project Services at RGP, join Count Me In to talk about transformation through emerging technologies and the audit considerations and regulations to be aware of. RGP is global consulting company that serves over 2,400 clients, which includes 3/4th of the Fortune 500 companies. Mark is a Vice President within RGP’s Global Finance Transformation Practice focused on process efficiency and improving automation in the finance and accounting functions and Janis is a Vice President within RGP’s Advisory & Project Services team, leading cross functional initiatives in finance, accounting, and risk and compliance. She brings over 20 years of experience and expertise in finance and technology process design, risk management and driving continuous improvement for companies. RGP enables rapid business outcomes by bringing together the right people who together create transformative change. In this episode they look through the lens of a CFO and explain the top trends and priorities for finance leaders. Download and listen now!Contact Mark Marmon: https://www.linkedin.com/in/mark-marmon-3255414/Contact Janis Parthun: https://www.linkedin.com/in/janisparthun/IMA's Transforming the Finance Function with RPA: https://www.imanet.org/insights-and-trends/technology-enablement/transforming-the-finance-function-with-rpaMcKinsey's Bots, Algorithms, and the Future of the Finance Function: https://www.mckinsey.com/business-functions/strategy-and-corporate-finance/our-insights/bots-algorithms-and-the-future-of-the-finance-function FULL EPISODE TRANSCRIPT:Mitch: (00:05) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host Mitch Roshong, and today I will be previewing episode 168 of our series. Before I introduce our speakers we will first set the stage for the topic. The global pandemic in 2020 and 2021 has shifted how finance and accounting professionals work in a virtual environment. And this change has also triggered opportunities for the finance organization to evaluate and introduce emerging technologies. Companies want to find ways to deliver financial results faster, amid grow complexities and regulations, as well as improved financial transparency for business partners. To discuss these trends from the CFO perspective, we were fortunate to be joined by Mark Marmon and Janis Parthun. Mark is the VP of Finance Transformation at RGP, and Janis is the VP of Advisory and Project Services at RGP. They joined my co-host Adam to provide insights on what they are observing from the marketplace and their clients. So to hear about how to best manage the complexities relating to transformation through emerging technologies, keep listening as we head over to their conversation now.  Adam: (01:27) Janis and Mark, thank you so much for coming on the podcast today. And as we looking into 2022, I wanted to start off by asking you both, what are some of the top trends and priorities for financial leaders as we look into this new year?  Janis: (01:43) Adam, that's a great question and this is Janis, by the way. You know, CFOs are really playing a crucial role to drive change and to be value creators. So according to a 2021 Gartner survey on the CFO perspective, there's really a shift from a value protection to value creation and prioritization, of digital initiatives and investments, and from a value creation perspective, it's really, focusing on a strong forecasting process. And this is especially critical time for CFOs of companies who may be carrying inventory to have a strong forecasting process, to avoid inventory supply chain issues and, just overwhelming sales teams and processes. And then from a digital investment perspective, over 80% of CFOs have suggested to increase their investments. And emerging technology was one of the CFOs top five strategic business priorities for 2021 and also a significant increase from 2020.  Janis: (02:50) So it, you know, it really says a lot about the importance of having to take a look at emerging technologies, and how that can impact the CFO's role. And, you know, by the way, IMA also has a great resource on the transformation of the finance function and association with RPA. And interesting enough, the research had discussed in terms of how it's possible to have over 70 percent of general accounting operation activities that can be automated using demonstrated technologies. So I found that that was really interesting to read through, in one of the resources, from IMA.  Janis: (03:35) And so going back to the discussion on the value creation and digital investments, what does this mean? So this is stemming from the need to automate core processes and having to transition to generate more data insights and future outlook. And so according to another Gartner source in 2021, it was the top priorities for finance leaders, CFOs, controllers, and FP&A leaders now all expect to focus on digital initiatives and the top priorities that are expected to be taking more time to implement. And these top priorities mentioned included advanced data analytics, technologies, and tools and finance, and there's a wealth of data that can provide insight to make operational decisions. And it's also knowing how to use it. Another one is the robotic process automation and other workflow automation technologies. RPAs deliver speed, efficiency, and cost optimization for repeatable processes. But then if you add extendable platforms that incorporate hooks into machine learning and artificial intelligence, it really becomes more important as leaders to look beyond the simple rule based workflows.  Janis: (04:55) And I would say, thirdly is the human element, which is accelerating digital skills and that's hiring an upscaling talent to accelerate adoption of digital technologies. So now the deployment could be difficult at times and having to spend time significantly with employee engagement and retention, as well as hiring and growing digital skills, but it be beneficial to have the ability to design flexible processes and then enable aspects of self-service reporting for users. So I would say the good news is that the new generation of the workforce entrance are digital natives. So not only do they embrace the technologies, but they also expect from their employers, those are some of the key highlights that I wanted to at least talk through in terms of trends.  Adam: (05:50) Well, Janis, thanks so much for showing that. I mean, those are some great top trends and priorities that, financial leaders need to look at. One topic that I have heard that I didn't hear you bring up was financial close optimization. You know, this is one way that companies drive results faster, are able to, do budgeting. How does this change the game? And maybe Mark, we can have you start on this one.  Mark: (06:12) Yeah. Thanks Adam. So first let's define, we're talking about when we talk about, close process optimization, we're really looking at eliminating some of the activities that are really not all that critical to the close cycle. So in many cases, you know, many folks out there listening probably know that there are reports generated that really aren't read and, evaluated by anybody in the organization. There's a sequencing of efforts across the accounting team with redundancies and bottlenecks. And the whole idea of close optimization is you want to take those bottlenecks out and you want to reduce those redundancies. So traditionally, when we looked at close optimization with companies that we serve, we were really focused on taking the cost out of the process, you know, the fewer FTE's that you needed to actually perform all these manual repetitive tasks, resulted in a little bit of cost savings.  Mark: (07:13) So today, as we look at what's happening in the financial flows and looking at the close cycle, significant increase in demand for efficiency around the close cycle, the CFO is asking the accounting function to invest their time into providing analysis and really predictive analysis into what's going on for the key stakeholders of financial and, you know, financial of that financial information. So when we look at executives and investors and they want insight into the business, they want to know how those financial results compare to expectations. So it's causing a shift and that shift is taking out the routine repetitive work that we've traditionally done with spreadsheets and moving it to a more automated approach. And since frankly, the spreadsheets are somewhat unstable and they're kind of ineffective as evidence for your external audit, then a better performing automation becomes pretty critical as part of the accounting close.  Mark: (08:22) So the question becomes what types of automation are most effective. So clearly when we look at the ERP systems that are out there, they're recognizing there's an increased need for more tools as part of the close cycle to support it. And they're building in new modules, they're building new Bolton applications that can help increase the efficiency of the close process. One interesting aspect is we're seeing a number of these large ERPs start to partner up with purpose-built solutions and actually use purpose-built solutions to come in and do certain types of modules or certain types of activities like account reconciliations or transaction matching. So those purpose-built platforms that we're seeing, they're evolving because over the years, they're years ahead of the ERPs and they are much more effective at actually providing some of these key transaction based initiatives. And they're already kind of on the front end of the advanced transformation and automation life cycle.  Mark: (09:30) So they're continuing to add their capabilities based on their customer's experiences, and they're frankly, more stable and more dependable than the traditional Multilink spreadsheet. So the next iteration that's going to support those purpose-built platforms and a good example of a purpose-built platform would be BlackLine. Many of the folks out listening may be familiar with BlackLine. The next iteration is the use of robotic process automation, which Janis mentioned. The use of bots to come in and actually accelerate the speed of repetitive routine transactions. And then linking that back into a purpose built solution allows the entire close process to become streamlined and much more effective. And then frankly, the whole financial close process moving into new emerging technologies has a pretty dramatic impact on the workflow or the workforce out there, which Janis, you may want to share some thoughts on the impact on the workforce with the digital skills required.  Janis: (10:40) Yes, that's right, Mark. It's also important to be thinking about your people and the talent and having to attract and retain people with a digital skillset. Now in our current workforce, millennials and gen Z employees tend to gravitate towards firms that are embracing technology for really two reasons. They're comfortable with, or they're accustomed to the technology and as they've grown up with the technology or essentially digital natives,. And two, research shows that they're motivated by having interesting work in which they can see their contributions and using technology to provide insight and driving the organizational improvements are motivating to them. I would also say that you would want to take into consideration other stakeholders in participation outside of accounting when it comes to around people, and having to, incorporate emerging technologies. This may be CTOs and CISO's and having to take that into consideration. And also having to assess and think about the digital workforce, especially, at this current, stage and time as well, and scaling the use of the systems and tools across the regions and countries, and be able to collaborate with automation tools that's in the norm to be successful.  Adam: (12:03) So what about any emerging technologies for FP&A, we've talked about that a little bit. What does the CFO now have at their fingertips?  Mark: (12:10) Well, Adam, similar to the accounting close process, FP&A has also been historically really heavily dependent on spreadsheets. Whether we're talking about building budgets, looking at forecasts, multiple financial scenarios, the spreadsheet has been the tool of choice. And when you think about the CFOs, really asking for these days, they want greater insight into the business, they want alignment between the budgets and the business planning, they want greater accuracy and more timely forecasts. And, you know, you think about the volume of transaction activity over the past few years in the M&A space. And you realize that capital planning is more crucial than ever. And frankly, spreadsheets are really difficult to make all of this work. We also are seeing a heavy investment in private equity, into growth companies this past year. We're finding that those that work in companies are part of a PE portfolio, know that those firms create a lot of data and a lot of insights.  Mark: (13:16) And they ask for that information in real time. And frankly, they often asked for that information yesterday. So as the key investors are constantly strategizing on how they want to grow the business or add to the business or carve out of the business, or simply monetizing in real time. They want constant modeling. So as businesses are taking a look at how they can meet those needs, and then you put in the additional challenge that's come through from the pandemic over the past couple years of a change in the demand for goods and services and the ensuing, impacts of a global supply chain crisis. We're finding that companies are constantly forecasting and in many cases re forecasting, you know, maybe 2, 3, 4 times during the course of a period. So the FNA function in order to add business, or in order to add its business value, it means they can't spend days and days developing these types of spreadsheets.  Mark: (14:22) And they've got to start moving and pivoting to a more effective way for scenario planning, where they can give consideration to multiple futures, predictive analytics, seeing that information in real time, providing service reporting to the executive team and with all of these challenges, you've got to also consider where the data comes from and a CFO is looking for consistency. And we're finding that with the significant number of sources of data in an organization that oftentimes they're not getting one version of the truth. They're getting information from different source data that comes out and gives them different answers, which makes it difficult for their business decisions. So what the companies are starting to evolve into is more of an enterprise performance management concept. Now, EPM is a concept that really derives to a holistic approach to looking at financial data across an entire organization.  Mark: (15:28) You want the business to be using the same data that's being used by the accounting function for their external reporting. And you want the decisions to be coming off of the same types of data. And so purpose-built platforms that are really designed around performance management are becoming more of the norm. And one, for example, that is extremely strong in that space is One Stream. It's an opportunity to take a look at everything from the close process at the front end source all the way through to the back end business reporting with KPIs and dashboards. So looking at consistency, looking at the planning functionality, making sure you can do multiple scenarios and all of your planning in minutes, as opposed to days or weeks on a spreadsheet. That's what the beauty of all of this automation is bringing. The other part that's really impressive about some of these, platforms that are starting to become more mainstream is that the CFO can access that information very quickly. It's accurate. And the cost of this is actually being driven down. So while these new platforms are extremely robust, they are user friendly. And we're finding that the implementation is actually becoming much more cost effective and to top it all off what we're also, seeing which Janis said a couple of times, is that the workforce of the future is digitally enabled and they expect to have access to these technologies as they grow in their careers.  Adam: (17:03) For sure accuracy, accurate data is so important, especially now, in a digital world. And even when you're talking about accuracy of data it does make me think of the auditor who is trying to audit all of your books and all of those things. And so going into the next question, what impact to the auditor and regulators will all the things, different things we have spoken about today have now on the folks in that community, but also looking forward. And, Janis, I'll give that question to you.  Janis: (17:33) Great, thanks Adam. I'm happy to answer. As you've heard from Mark and the trends I've mentioned earlier, the shifts to focus on value creation and digital prioritization really leads to automation of core processes and the finance transformation, but this shift also impacts the auditor and the regulator community and the need to stay current with emerging technologies. So if you think about technologies within a scope of a financial audit, there's been an increasing trend of companies incorporating the cloud environment, the software platforms, either ERP or purpose-built, and other solutions such as in-house platforms, internet of things, and connectors just to improve the workflow. And as the accounting and the compliance profession continues to evolve, so are the auditing approach such as the technologies to improve the audit process, RPAs, bots and data analytics tools, and as according to ISACA study in 2021 serving, over 4,500 members on emerging technologies, it was interesting to see that 59% cloud related technologies weren't used in terms of top emerging technologies.  Janis: (18:55) And then what came second was 34% in artificial intelligence and 27% in the internet of things. So it's interesting, as you can see in terms of the trends and the perspectives, that's also evolving with the auditor and the regulator community. Now, typically from an auditor perspective, you'll want to consider, the objective or the business rules, or the materiality of the function or transactions process. And this could include having the change in the policy process to trigger a review of an existing rule set and essentially preventing introductions of inaccuracies or missteps in the activities. But now there are additional elements that you need to consider as more emerging technologies are incorporated into the daily financial transactions process. And this could be in terms of the full understanding of the system environment. As now, there are multiple layers associated, in incorporating emerging technologies and also having to have considerations in terms of the testing approach.  Janis: (20:05) So this can involve the change management process having to make sure it's inclusive of the systems and use having to consider appropriate, secure design and the user access and the rights, protocol in place to monitor and the alert of errors that occur and just be consistent. And these are only a few mentioned, but definitely there's a multitude of elements to consider as more complexities are, introduced. Now, examples of emerging technologies that are relevant for financial audits may include bots and RPA, as well as machine learning and artificial intelligence. For bots and RPAs, a good example would be automation of accounts receivable, reconciliation that's based on specific requirements defined to run on a recurring basis. For machine learning and AI, it could be examples, related to credit and collection management with customers. I'd say a good example of this, we had mentioned earlier in terms of, BlackLine, but there's a good example, in terms of the BlackLine AR intelligence, where they offer AI to be able to analyze customer payment behavior, to identify trends, and then to understand the payment behavior to help manage the cash management.  Janis: (21:30) So, FP&A technologies might be less material to financial audits in terms of more focusing on supporting forecasting, as well as operational functions, but you can never necessarily rule things out because it just depends on what is being leveraged and, used for in that. So having to share multiple perspectives from CFOs and controllers, to auditors and regulators, what continues to be relevant for all parties is to really just to stay current and seize opportunity for change and finance transformation. And this includes earlier, we talked about the financial close and FP&A technologies, as well as technologies utilized to improve the financial audit process. And one thing you know, let's not forget that organizations also need to embrace emerging technologies, and that includes upscaling the current talent in the workforce training and on the job experience, as well as hiring talent with the needed digital skillset. So organizations that don't embrace technologies will be unable to attract the top Millennial and Gen Z talent who may expect this.  Closing: (22:49) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Ben Taylor: https://www.linkedin.com/in/bentaylor8/SoftLedger: https://softledger.com/general-ledger-accounting-softwareFull Transcript:Adam: (00:05) Hey everyone. Thank you for coming back to listen to another episode of Count Me In, I am your host Adam Larson, and this is episode 176 of our series. As we hold conversations about various topics impacting the accounting and finance world, one of the underlying themes across most is strategy. In this episode, you'll hear from Paul Ruppert, an ambidextrous executive with deep experience in startups, as well as global fortune 100 enterprises who shares as knowledge and expertise on strategic partnerships. Keep listening to hear more about how the finance team can best support large strategic initiatives for the organization. Mitch: (00:50) So as we get through today's conversation, we're gonna look at some concepts around strategy, strategic partnerships, but I think it's first important to kick off what are some of the biggest considerations or are challenges that many are facing in today's business landscape? Paul: (01:06) I think, you know, many people get into business thinking that there's some linearity from a plus B plus C equals D equation, but in reality, it's all about adaptability and change. And change is not only the change that you experience when you start facing various types of problems and challenges and friction points, but also your ability to manifest change, create that change and live through that change. I've been involved in businesses on a global basis and how I approach the business in the US was very different than I was approaching the business when I was in Hong Kong or in Europe. And that adaptability, that agility as it's often described, you know, in technology is really the the watch word more than anything else, in my view. You know, there's, as I mentioned earlier, earlier before our call, I don't believe in a silver bullet solution. Mitch: (02:13) And as we talk about adaptability, agility, you know, the bottom line is we are looking to advance the business, right, advance the function and adapt to modern advancements. And I think you just kind of mentioned briefly technology here, but without having a crystal ball and being able to see into the future perfectly, what does the future of business really look like? And, you know, as we continue to adapt and be agile, what are we really preparing for? What is the future of the business landscape look like? Paul: (02:45) Well, you know, that's a big, big question in the context of where is everything going. If you just look at our immediate past in past history, you know, three years ago, I'm involved in the text messaging business and it's been around, it's how, you know, enterprises communicate and connect with end consumers. And we live through it on a day to day basis. When you get tested for what's called a one time password, you know, you just proving that you are who you are. And the business let's say three plus years ago was moving steadily along. And let's say let's call grocery store rates, meaning about three to 5% growth rate. This is a fairly established industry. You know, it's roughly about $200 billion of business globally. It's quite large, but people don't really experience on a day to day basis relative to cost and effect if you will, but they still utilize it. Paul: (03:47) And since the pandemic, because of the dynamics of how we behave as human beings and being working from home environments and the fact that we are now utilizing zoom and video, et cetera, the reality is that the messaging business has grown to about 30% CAGR for the next three years is what the expectation is. And I am of the belief that once human beings experience something much more convenient for them, they usually don't turn backwards and want to do something less convenient. Okay. So in all of that context, that's kind of the dynamics of where we are going, what it looks like and the over the horizon perspective, the crystal ball, as you characterized it is that your expectations often may be unexpected. Things may not go as you think they are going. And there's lots of converging factors, you know, digitalization prior to COVID, the growth of it, the speed of it, the means in which many business were able to quickly and with great agility pivot to new types of initiatives, you know, I can talk about call centers that were stripped down from being on premise in the course of four to five days and redistributed to the the call center rep's homes, because everybody shifted, you know, we couldn't be in large groups any longer, it was just too unsafe. Mitch: (05:22) Now a lot of our listeners are in, you know, the business of opportunity recognition. And I know it's very difficult and maybe unexpected as some of these you know, evolutions arise. You know, we first spoke, I know you mentioned something along the lines of you know, the business landscape reaching 6G. So with some of this uncertainty but so much opportunity, what can our listeners really take away you know, from the idea or what should they be doing really to maybe open their eyes a little bit and see what this opportunity means for their individual businesses, Paul: (06:03) Right. Yeah. You know, we all watch well, many of us watch professional football, the NFL on weekends, and, you know, the number of mobile phone companies like principally T-Mobile, AT&T, and Verizon all talking about 5G. And then if you were to turn to your spouse or friend that you're watching the game with and ask the question, so why is 5G better than 4G outside of the reach? You know the reality there is that what we're doing right now is probably gonna be the, one of the big manifestations of 5G value, which is video and speed and processing. And so as we then move to 6G, then it becomes much more engaged on such things as what's called sentiment and intent. So you might be reaching out to, you know, let's say your mobile phone provider, because you've got an issue with your iPhone or something along those lines and that inbound call or inbound message or whatever it might be that platform that you're utilizing to connect with your provider, they already have a sense of what your intent is. Paul: (07:17) Why are you calling, you know, and that's, you know, consumer data products and platforms that are looking at combining your personal behavior, as well as the fact that you might have an iPhone eight. And, you know, the lifespan of that iPhone eight is probably five years past it's optimal performance. And so soon as they start talking to you, whether or human being, or not, whether it's a chatbot that may come into the dialogue as to, would you like to upgrade your phone? We see that it's six, seven years old, something along those lines, that's the kind of stuff that'll be playing out, which is a little spooky. Mitch: (07:59) It is, it definitely is, but everybody's looking for the answers as fast as possible. Right. So if that means getting them to the solution sooner, I think we're just going to adapt and take that luxury eventually. So with that in mind, you know, I think, like I said, going back to opportunity recognition, this is an opportunity for individuals to really expand their horizon, right. And it's an opportunity to possibly, you know, take their business or their function and look to build some strategic partnerships with others who are able to bring those opportunities to us. So when it comes to strategic partnerships, what are some of the things that individuals should really pursue or make sure that they have you know, for both sides, I suppose to make sure that this endeavor is worthwhile, you know, with technology, there is so much risk and uncertainty but developing strategic partnerships, what are some of the keys to consider there? Paul: (08:59) Yeah. First and foremost is to be open-minded, don't be close-minded relative to what you're looking at because even potentially partnering with your competitor may have value I'm in a business that is cooperative and competitive at the same time. And you can't do the business without having that type of relationship that you may be competitive hammer and tongs in the marketplace, but technologically, both of you need each other to be able to provide the solution to the broad marketplace. So open mind open-mindedness flexibility. I used to, well, I still use the term agility and humility in the context of you're not walking in saying, this is what I think I want. And instead, you're thinking about where are the opportunities, as you mentioned, the opportunity recognition, the opportunity subsets, and then it's as much about what's your strategy in terms of partnerships, are you looking to influence influencers that are gonna be making buying decisions? Paul: (10:06) That's a different initiative than trying to figure out I was once in a project where myself and my technical lead in a company, we were in a hotel bar in Tokyo, and this was in 2012. And I said, you know, this whole thing about cybersecurity, we gotta figure out how to be able to provide a solution to identify potential infringements on mobile networks and text messaging. Could we do that? He was like, well, yeah, you know, and he brought, broke it down relative to the analytical functionality, but we didn't know in the platforms. So we then went hunting for who could provide that type of platform, that functionality, and we found them. And so then we reached out to 'em and said, this is what we do, you know, and this is what you guys do. We want to be able to figure out how we might be able to work together. And within nine months, that was a live trial with, at and T. And within two years, we were generating about $16 million in revenues, which was roughly about 8% of the total revenues of the business unit at that stage. Mitch: (11:16) And, you know, strategic partnerships, something for many of our listeners, accounting and finance particularly internally we address this as business partnering, right? Being able to raise awareness you know, identify some risks, not necessarily give all the answers that everybody wants to hear, but look at it strategically. so before we get to the accounting side of things, just from this risk and strategy, you know, concept and, you know, talking about foresight, looking to see that we need to do something, maybe it is working with a competitor or somebody that you've never worked with before an industry you've never dealt with before, with all this technology evolving now, how do you ensure that whatever partnership you're proposing, you know, when you bring it to the table and you have these internal discussions, how do you ensure that, you know, you get that buy-in and you, you talked about influencing, but how do you take it to the next step where you can actually see the results that you ended up seeing? Paul: (12:14) Well there's no guarantee to any of this, you know, you may be starting off on your journey with the objective of, yeah. We found this company and they do this type of process, and let's go talk to 'em and you may find that they're not very likable or they're not very cooperative, or they're not interested in having that kind of dialogue because they think that you might be stealing their IP or whatever it is. So it's as much about, oh, you know, coming with an open hand in an open mind and kind of laying out here's the opportunity. I was once in an acquisition in a company that we got approached by a visionary, and he said you know, this text messaging stuff, this was in 2006, mind you almost 15, 16 years ago, this text messaging stuff would be great in a customer relationship management software capability, which is what we do, you know, and those of us who were in the transport side messaging side, we looked at each other and thought, who would've ever thought, you know, we should have thought that. Paul: (13:19) So, you know, here's somebody who's coming forward with a potential partnership while the partnership was in acquisition is how it all played out in the end, favorably, mind you. But, you know, if we had put up our guards and weren't really interested in having that conversation that wasn't our attitude. We were open to any conversation because we had already been looked at before, you know, but we also recognized that wasn't a good play. We walked away from it. No harm, no foul type engagement. And then something else came up. We were like yeah, this might be viable. And our investors, like, this is what we should do. Mitch: (13:56) And then, you know, as far as investors, you know, M&A, a lot of that, our listeners are a part of, and I do want to bring this to our, you know, the accounting and finance side of things. We talk about a lot of the strategic partnerships, opportunity recognition, and many of us are, you know, involved in these, but you know, it's cross-functional and somebody like yourself, you said, you're not in accounting or finance. You know, it's important to have relationships with those who do understand that. So, you know, from somebody who is experienced and successful with a lot of these strategic partnerships, from your perspective, what is the value of having somebody with that accounting background Paul: (14:37) It's critical. and I think I mentioned in our pre-call in the context of how I've approached this being a commercial guy, you know, the moniker, just a sales guy, I'm not just a sales guy. You don't go from sales to M&A, unless you've, you know, laddered up and have a fair amount of skill sets to be able to support that. But in every case where I've run either a product group or even a sales group I had somebody that I designated as the financial expert, meaning somebody who I could turn to and say, I wanna model here. And here's how I want to model this type of pricing exercise or what the valuation might be relative to, you know, let's look at the business case and create that and create that quickly. You know, I can do that, but it takes too long. Paul: (15:24) And so I'd rather go off and get some, you know, younger, you know, person who literally I've walked in to an office where we thought we were gonna be firing somebody you know, and about five minutes after meeting with the guy re recognized that he was gonna be more valuable if we kept him. And I put him on my team and essentially said, would you be interested in joining the product team, even though you are in finance? And he was like, well, yeah. I mean, that seems a lot more interesting that what I do in finance, it was like, okay, you know, targeting people who would have the right affinity and the right perspective and the flexibility to be patient with those of us who are not spreadsheet monkeys, I should say, spreadsheet, masters. and you get the idea, it's it's as much an attitude in terms of being able to communicate what the objective is, you know, I used to say, I write the manifesto, you write the code and be able to put that forward so that the bridges are made and the bridges are made early on. Paul: (16:27) And that partnership is established early on, as opposed to, you know, okay, what do you want us to look at now? And even in the context of how to approach the problem, you know, recently I was in a conversation with a client where they were talking about potential acquisition. The company had no corporate development team. This was a substantial company, not publicly traded, but still nonetheless, a very substantial company, almost a billion dollars in revenues. And most of the stuff that they had done in M&A was on the fly, what I would call fire, ready, aim analysis. And you know, I looked around and I asked the question, okay, well, you guys have done a few, but they're really small. And this is a lot larger that you're thinking of, bigger scale. You're gonna have to do it swiftly. Paul: (17:16) And by the way, there's a digestion period off after the fact. So the numbers may look seemingly at first pass a good thing, but there are a lot of soft analysis and factors that need to be reflected. So we need to ensure that those are reflected in the well that, you know, was a combination of my perspective and on the operational side, as well as the financial perspective of how do we measure and reflect the impact of those as costs, you know, and put a dollar figure behind that. And that that's a collaborative effort. Mitch: (17:54) And, you know, you mentioned being able to do some of these models or analyses and doing them quickly. And I think a lot of what our accounting finance listeners are looking to do is, you know, upscale with these technologies in order to do their jobs more efficiently. But what you're kind of talking about here is really the re-skilling. Being able to take that skillset and apply it to a different function of the business. And I think a lot of what we're looking to do right, is kind of get that seat at the table. I think that's what a lot of our members and listeners want. So just, you know, you mentioned junior individuals and other finance you know, professionals, but as far as, you know, maybe the technical skills, but also some of those, the softer skills and just personality, how do you identify somebody from the finance team that you want on your team to help your strategic partnerships? Paul: (18:44) Wow. You know, I wish I could say, well, this was my plan, in each of the scenarios, and here's the plan that I'll use in the next scenario, but that's just not the case. You know, it's as much instinct, instinct is essentially inferred experience and experience is gained. I should say an inferred expertise and expertise is driven by experience. So there's a gut factor in the context of knowing what I'm looking for and, you know, it helps when you're the leader of an organization and, you know, you know, what you want based on your past experiences. I guess generally I would say back to keep an open mind and look to, as you put it re-skill and apply your capabilities in other venues, because those skills may seem routine or even mundane in what you're doing. I mean, that's why one guy was like, yeah, you know, this is gonna be a lot more exciting than, you know, what I'm doing in the accounting group. Paul: (19:52) Good. That's the whole idea, you know, that may seem mundane and routine in one environment, but then could be an extremely valuable asset in another environment. And that's how you end up by showing your judgment and skillset, et cetera. That's how you end up earning the seat at the table. As you mentioned, you know, we, there's a great book. I'm forgetting the author's name, but it's called range. And the premise of range is essentially that we have gone to the point where there's too much niche expertiers. One person does one thing really, really well, and they are viewed as the grand and therefore should be the unified leader. However you want to characterize it. But in reality, the complexities of the problems that we face, you know, there's a great example, like climate change, you just can't have one perspective. Paul: (20:46) You've gotta have a lot of different experience to be able to come to the table. And I think that's as much what I've tried to do in my career. I mean, I've kind of ambidextrous in the sense that I have a pretty solid public slash political career when I was in my twenties and then exited into the private sector when I was in my thirties, but still utilized a lot of the skills and expertise that I developed, you know, as a young person in the political world and applied in the private sector. And even in the context, I then took that and pivoted into from going from large enterprises, you know, fortune 100 companies, AT&T, into startups and leverage that polish and process, but then also having the creativity and the agility, and even the attitude of being in a buccaneer inside a startup environment. Mitch: (21:44) And so I do wanna wrap up this conversation. It's been extremely insightful. So thank you for sharing your experiences, some of the examples along the way you know, just as a last question for you, any last thing that you would like to add, you know, any advice or key takeaways from this conversation in terms of strategy, strategic partnerships, you know, earning that seat at the table, you know, what, what is a piece of advice that somebody in your position would like to share with our listeners Paul: (22:14) So often I'm not going to label accountants as being the center of this, but so often people like, you know, the minimal viable product perspective of identifying your market and identifying your functionality and moving from zero to one, and then going from zero to one and realizing that, you know, that was a great success, which is essentially approaching a startup and getting a startup up and running. But I'm of the school that, you know, Reed Hoffman, who's the founder of LinkedIn, I believe, and wrote a book called Blitzscaling. And ironically, I kind of did blitzscaling before he wrote the book, but, you know, and as he puts it think going from zero to a billion and think in that context of, you know, I characterize it as going global from the start because global markets are gonna be bigger. They may be more difficult, but if you've got network effects that you can play out, you get faster, you get bigger and you end up defining the terrain that you're operating in relative to your competitors and even your customers. And if you're in that space, you know, then you're really the lead dog in all of this. So if there's one thing that I've would suggest, you know, I would, I'll put it in the context of special air squadron motto, which is the British SAS, who dares wins. Speaker 4: (23:45) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Contact Liv: https://www.linkedin.com/in/livwatson/Contact David: https://www.linkedin.com/in/david-w-29627882/Visit Adviseers website: : www.adviseers.com  Visit David's website: https://davidwray.com FULL EPISODE TRANSCRIPT:Adam: (00:05) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson. And this is episode 166 of our series. Today we are fortunate to be joined again by Liv Watson and David Wray. Liv and David recently shared their perspective on a proposal for the digital transformation of sustainability information, in United Nations Climate Change conference sponsored site event. Attendees from around the world included policymakers, standard settlers regulators, to preparers, NGOs and funders. The goal was to leverage the worldwide momentum for climate change and sustainable economies. In this episode, they summarize their perspective and share with us their view on what the profession can do to accelerate this transformation. More specifically, they discuss how management accountants can support their organizations in managing the data life cycle of sustainability information from cradle to grave. Keep listening as we head over to the conversation now.  Mitch: (01:15) So I understand you both talked in Glasgow about the greening of data and to start off our conversation, I'd like to first to ask, what do you mean by this?  David: (01:24) It's a great question to start really setting their context for the conversation and the discussion we're going to have Mitchell, because you're right. We were in Glasgow talking last week about the data life cycle and Liv and I have coined the term greening of the data as a way to describe some of the problem, but let me be put it in context for you. So if we think back to the IFAC work, and we've talked about this in previous podcasts and some of us may be very familiar with their work, they basically look to assess the cost of prudential disclosure reporting. And it was just one example of the issue that we see around data management and the cost of that data, to the compliance and regulatory reporting that ends up happening.  David: (02:08) So we know that in the context of the IFAC report, that about 780 billion US dollars is spent every year by the financial services industry alone on this type of reporting. So what we are saying is, look, what if we could save half of that data, like half of that cost, of processing that data through digitization and structuring data at creation. So if we really started to think about it at the point of inception or origination, and we really carry that idea through to how it's processed, how it's disclosed or how the user consumes it, imagine the kinds of things that we could do in terms of environmental initiatives that we can invest in to better the planet with the money that we save. So really what we're talking about is it's about reducing the ecosystem costs for the sustainability reporting and basically reinvesting this spend into initiatives that will ultimately result in sustainable economies and business models and have better stakeholder citizenship, because that's really what it's all about.  David: (03:13) And all of this could be done without raising a single incremental tax dollar, because frankly, I think we all need to look at more creative ways to start achieving sustainability objectives without defaulting to what we've always done, which is raising taxes. And we can see the effect of these tax discussions in bipartisan decisions all around the world. It's not, you know, unique to one geography because as effectively a tug of war between fiscal responsibility and the social climate responsibility, and that's really what's tugging this discussion. So unless we can start to unlock this barrier, we might still actually be talking about this subject in 10 years time and time being a luxury that we don't have much of anymore. So greening of the data is all about reducing the cost of compliance and then reinvesting that for the better of the planet.  Mitch: (04:03) Well, you have certainly piqued my interest and I think a natural follow up question to what you just discussed is how, right? So I'd like to direct this second question to Liv. How do you make this digital vision a reality that really benefits everyone? And, you know, David just mentioned some of the stakeholders and the tug of war. How do we get everybody in alignment around the world, on this topic?  Liv: (04:28) Okay not an easy task, but Mitchell, thank you again for having us back on the IMA podcast and amazing platform to get new topics, new ideas from. I would also think IMA's and many of the listeners might not know this, but IMA was actually part of the founders of the digitization of financial and business reporting as a founding member. So, XPRL international. So our industry organization had been a thought leader in this topic for a long time. I have had lately the opportunity to lead an initiative appointed to the European commission or by the European commission to EFRAG. And for those of who don't know EFRAG, answering your question here very quickly, but the players are key to understand is that EFRAG has been kind of the similar to fast P in the United States and standard center for financial reporting.  Liv: (05:39) EFRAG is the European equivalent working with the International Accounting Standard to recommend international standards, to the European commission that they then adopt and embed into legislations. Right now, we have talking about greening of data, two drivers, right? Regulators wants to reduce the cost of compliance and standard setters has to start thinking digital from the outset. And so EFRAG, who used to be a standard take. And with now becoming after a consultation that I was appointed to a special task force, and we proposed 54 detailed proposals on how the European commission could accelerate sustainability disclosure and improve on their current reporting requirement, which was a legislation called the Non-Financial Directive Reporting Directive to now becoming a delegated act to improve. Because now they want to be thinking not just standard that are more descriptive, not only just more descriptive, but also we are in the statement.  Liv: (07:03) So for an annual report in the management discussion, we are now writing the standards, proposed standards for the European commission to mandate the data, to be disclosed in the management report. And why is this important is thinking digital from the first trying to get standards that are written by silos, and then trying to bring consistency so that you can digitize them, not just the reporting. So the taxonomy for the reported data, but also think about digitize the standards that today sit locked up in PDF files, et cetera, that they've actually become executable codes. So yes, number one, we need to start thinking digital from the outs and not digital after the standards and legislation, are put in place. So that is why we feel that now is a momentum but it took strong leadership from regulators to standard setters to a project that David and I have been very involved with under the Institute of Management project, an initiative supported by the G 7 to bring consensus to sustainability reporting and thinking digital first was a project that we got on the agenda, the standard setters.  Liv: (08:43) So yes, it takes a village. I will tell you, but I do feel right now and some of the work before I talk about some of the key findings or the challenges of digitization for the last few years, David and I have done research around the complexity of digitization for companies and David coming from the preparer side, me coming from building compliance platforms, that's used by some major companies around the world. We discovered how fragmented regulation, right? And you can't just digitize and create structured data that can be discoverable if standards are not written more structure. So that fragmentation because standards and regulators are so fragmented in our paper, the digital transformation, brief business reporting in the fourth industrial revolution that was published by IMA and thank you to IMA for letting us publish that paper. Because at the European commission, in our analysis, that supported why we needed digitization was actually drawn from some of our research within that documentation in that paper.  Liv: (10:09) But we also need data management to collect data that is like cost enabled. David and I talk about greening the data, but we also need to create discoverable data, digital's data. There is lots of it out there, but how do you find it? Where is it? So the data ecosystem is fragmented and we need key stakeholders and IMA to continue supporting this journey because it's really, truly not just, and one time kind of an event there, we are on a journey on digitizing information that is consistently changing. And in a very dynamic world, it needs what we call controlled vocabularies, And agreed interoperable, taxonomy. So not sure Mitchell, I could talk passionately about this for quite some time, but I better get back on track and turn it back to you.  Mitch: (11:10) Well, thank you, Liv. I mean, there's certainly so much to consider with this topic and you outlined so many key components of it. As you said, I'm sure you could go on for much longer, but, you know, to stay where we are in this conversation. And to flip it back to David for a moment, I do want to pick up on some of the things Liv just shared. I think for many of our listeners, particularly one of the things that they probably question is, how do you really present this issue to those who are making the business decisions within their organizations? So David, how do you bring this issue to life for finance and accounting executives?  David: (11:49) It's a great question because it is the million dollar question at the end of the day. Theory is wonderful, but what does it mean to me on the ground in my day to day role? So let me use a really simple human example to illustrate what we mean. And this is something I think that listeners, all around the world can relate to. So you're a preparer, right? You've been tasked with preparing, a sustainability disclosure, either a sustainability report or a disclosure. And imagine that you've got to try to figure out which sustainability standard or standards you have to choose to report on something like greenhouse gases. So today greenhouse gases are covered by CDP. There are also covered in IOS 14 0 6 4, and we don't stop there. They continue to be talked about in the greenhouse gas protocol and TCFD. And of course there are a number of country specific regulatory requirements as well. One example from around the world is in the UK and they've got the measuring and reporting environmental impacts guidance for business.  David: (12:53) So a preparer in the UK for example, would have to look at a number of different standards, and then they've got to start answering questions around. Okay, great. So let's assume I've read all of this and I can make sense of it. Then I've got to start thinking about questions to solve around. Well, what data exactly do I need to collect and how do I correlate that data in a way that is going to make sense and is going to relay something meaningful to someone who looks at it? Well, then how do I run that through scenario models? So if I have to run a number of models, how would I actually do that? And then how I going to assure the sustainability data? So even on the assurance side, a lot of standards that are at the moment are talking about assuring sustainability standards and data themselves in particular, which is absolutely the right idea, but it poses some very interesting challenges for the profession.  David: (13:49) So it makes us then sit back as finance or sustainability professionals and sit and think, how am I going to actually wave through just the sheer volume of data and the noise that gets created through that volume of data to actually tell them a coherent story to external stakeholders? So what we really mean is that in effect, this challenge is really four pronged. It's about data availability, data integrity, data fragmentation, and data that ultimately needs to be multifaceted, meaning it needs to serve more than one purpose. So when we talk about availability, we're talking about data that needs to be identified and known. So we've got to know where it's located, what format it's in, and is it conducive to a multi reporting environment? If you are sitting in an organization that has to report in, let's say 60 jurisdictions, that's potentially 60 different ways just on a country level, never mind an individual regulatory body within the context of that country to do the reporting.  David: (14:51) If we think about data integrity. So this is about data being trusted or capable of being trusted, which really speaks to the whole issue of audit and the ability to then audit that data. Or if we talk about data fragmentation, this is the recognition that data is effectively trapped in the number of silos systems at the moment, or potentially in some repositories. And it could hold a wide variety of formats, right? None of which necessarily are easy to automate or to integrate in any meaningful way. So we need to fundamentally change the data management process so that we really start to think about it from the context of inception. So data creation, not just disclosure. So as Liv mentioned a little bit earlier, it's thinking about the entire cycle and not just the output, which I think has been our traditional fallback strategy in years gone by.  David: (15:48) And then the fourth aspect, when we talk about this challenge of data in of the multifaceted nature of it is it's basically that the same piece of data should be able to fulfill a number of different purposes without having to be manipulated or re-keyed from one format to another. So in other words, how do we drive down the kinds of errors that are quite typical from those kinds of problems? And I think as Liv you've mentioned, we talked about this quite a lot in the paper that we published through IMA last year. So effectively, there are two key messages that really come out quite strongly from the work that we've done, that I'd like listeners to reflect on as they listen to this. So the first one being that when we talk about structured and govern into operability, it's really a foundational requirement for this digital future that we keep talking about.  David: (16:39) And it's got to be able to transcend geographical boundaries because the reality is, standard setters may not harmonize or integrate into a common set of global standards, certainly in the near term and maybe not even in the mid or the long term, you know, we can just see what happens on the financial standard side. And there really still are some differences after decades. So we need to start thinking about solutions that transcend that and allow geographies to have some flexibility. And digital is certainly one mechanism to do that. So what does that mean to us as preparers? Well, it means that we need to start insisting and putting more pressure potentially on policy makers and standard setters to consider it more concretely and directly in everything they do. So Liv, referred to it as this idea of digital from the start. And that's exactly right.  David: (17:29) So it's, it's about how the standard is designed because the standard setters or the policy makers will need to start thinking about what will that look like in digital form. So it's a very different way of thinking and therefore designing. So that's the first message. And then the second key message that I'd like to leave listeners to reflect on is we've got to mobilize together and that's the only way we're going to drive a digital solution. That's going to significantly drive down the cost of compliance for the entire ecosystem, because this isn't just about preparers. This is about everyone in the ecosystem, getting benefit out of this. Because as I said before, the money that we save could absolutely be reinvested in many areas for public good. And I think Liv said it really well a little bit earlier when she said it really takes a village to make this happen.  Mitch: (18:22) Now, David, you mentioned a couple times through that response. I know you said prepares earlier on, you said accounting and sustainability professionals. One thing I do want to keep top of mind is, you know, the target for our podcast here really being, you know, IMA members, but management accountants at large, I would like to kind of discuss their role and some, advice that they could take a bit further beyond, some of the key messages that David just left. So Liv, if I could ask you, you know, being a former IMA board member, what advice do you have for Ima members or the accounting and finance profession, in order to become advocates for this digital sustainability information transformation?  Liv: (19:07) Well, first of all, IMA as a professional organization, as I stated earlier, has been leading this, but it's also been my professional organization for over 20 years where both contributing to the body of knowledge, but also my career was built on the body of knowledge that I learned from IMA bringing in back into my work ethics and career opportunities. So IMA I think has and I'm going to quote our fearless CEO at IMA Jeff Thompson that says as the world continue to change, so too who must business change to focus more on holistically on sustainability business management for long term value creation. I think reflecting back on David and I being in the dialogues up in Glasgow's is also very interesting to see that this is not just a regulatory environment. This is a private public sector that we all have to change.  Liv: (20:20) And I think from an IMA perspective, management and accounting profession cannot better be suited to take on that challenge of greening data. It's our role tobring data forward that can drive business decisions and we need to, in our fiduciary duty and my opinion help reducing the cost of compliance and data management so that we can deliver data that is needed. So we need new skill sets. We need to think about how data is produced, discovered, and repurposed. Then we got to rethink how we contribute to the life cycle of data. So with that, I'm very excited also going back to the IMA and our now board as I stepped down. My time term limit was up this July, is that the board has now taken a decision to create a sustainability business management global task force.  Liv: (21:37) I will be a member of that task force, but it is about setting the stage for what is the kind of role of the management accountant. It also will start looking at things like, how we can become the custodian of data management and bringing this data. But it's also going to give us an opportunity to be right in the dialogue of the key topics that the world is talking about. Now you can hardly pick up a newspaper without reading about the real danger of climate change and the impact on business. So I want to emphasize that doesn't just impact big business. It impacts small businesses impact globally, and IMA is stepping out globally with this first task force. So going back to IMA, and our members, number one from a personal perspective, IMA has been the place where I get the knowledge to drive my career and opportunity.  Liv: (22:50) And I had quite a journey with being able to do so, working and traveling to over 108 countries and meeting IMA members in all parts of the world, but seeing their profession, coming together and really putting digitization first, we still have some, as I say, progress to be made. And with this new task force, I think we can get sustainability and digital thinking first onto the agenda. And greening of data is one of the greatest opportunity for our profession. I don't know David, if you wanted to add anything about that, but you and I are both very keen to say that the management, the accounting professions got to be at the table because that's where the cost of data is. The added costs that XPRL does for regulatory reporting is an added cost that bring value to the output. But the life cycle is where we got to get standards to be digitally auditable and discoverable. And we as a profession stand very well to take the opportunity to, advance this, topic.  David: (24:12) I think you summarized that brilliantly Liv and I agree a hundred percent. I think that it just needs a different level of thinking. I think it needs a higher level of thinking and frankly it needs real leadership and it's taking leadership in the, let's say the not so sexy things that we talk about in the context of accounting and finance, which is the data, the infrastructure and the plumbing. So I think it's recognizing that actually we've got a lot of potential value tapped up in that, that we need to unlock. And we can do that by creating a digital end to end environment and in doing so, driving down the cost and therefore enabling the investment of that saving, to the betterment of every, part of the world. So absolutely agree. A hundred percent.  Mitch: (25:01) This conversation obviously is, you know, beyond multifaceted, there are so many different, perspectives and different points that we can really dig into a lot of what we talked about. So valuable, as you said earlier on David, I believe, you know, it's, it's kind of been a little bit more in theory and we always really like to dig into the action, right. And some really actionable next steps. So, you know, in the essence of time as well, I'd like to just kind of ask one more question and give you both an opportunity to share what you believe the next steps may be, you know, for our listeners, how can they actively get involved? What can they really do to help realize, you know, this vision that you're discussing? And I would have to imagine, you know, obviously it starts with their individual organizations first, but as we wrap up 2021, we get into 2022, what can our listeners, the profession actively do to make progress on these initiatives?  David: (25:57) It's a great question. And it's amazing how quickly time flies chatting to you. Mitchell, it's always so much fun and ending on a forward looking question is always the best place to do that. So what can we do? There are a few things, actually, we can, some concrete steps that we can take as professionals. The first is something that is, an area, a very simple area to do, which is common on exposure drops that relate to business reporting and disclosure. And really, I think as Liv said, make sure that these requests include information, and disclosure around a digitization strategy because that's ultimately where we need to go. We need to be able to get data that's structured, standardized, has common vocabularies, common dictionaries, et cetera, because if they don't do that from the standpoint of setting the standard, then we need to push harder to make sure that they consider our preparer needs in this regard in a much more direct and concrete manner.  David: (26:57) So that's the first really easy, low hanging fruit to do. And there are gonna be a number of our opportunities to do that. Certainly I think as Liv mentioned earlier, Europe is going to have that opportunity next year and they won't be the only ones we'll also see similar, requests we already do from the SEC and others. The second concrete step that they can take is consider adopting a more cloud-based integrated business solution environment. So really, instead of thinking as of the traditional inflexible ERPs, start thinking a little bit more about the solutions that are more cloud based and more SaaS based that can end up into connecting with each other. And that's important because it provides the flexibility that companies and organizations need to be able to adapt to the rapidly changing environment that we're in. If there's one thing, the pandemic has taught us if nothing else has been taught to us around that from a business perspective, is that everything changes.  David: (27:53) And we need to be able to respond to that in a much more rapid manner than we have historically. And we need to be able to do that without having to go through significant transformation projects or programs, which frankly just add time, cost and complexity to many organizations. So even, you know, whether we're talking about SMEs or we're talking all the way up to multinationals, I think adopting this kind of a mindset for flexibility and integrated, cloud based solutions is a very healthy way to go. And then the third thing that I would suggest is a very concrete step is to start thinking about processes internally that think about data from inception, through collection processing and reporting, and start thinking about the process design, the process flow that they need to go through and start really thinking about what's the plumbing or infrastructure that needs to underpin this digital data management, right from the start within the company and thinking about it from the standpoint of, if I can extract value from this information, I can help management in a much more concrete manner around the company strategy.  David: (29:04) So really thinking about this information as being a gold mine, to helping us internally from a strategic perspective, not just, a disclosure requirement later on, because I think at the end of the day, we can't afford as a profession to sit in the backseat or in the passenger seat. We've really got to start taking a much more assertive leadership role in digital data management. If we're gonna get the kind of breakthrough change, that's absolutely gonna be necessary in 2022. And well beyond that. So on that note, thanks very much for inviting me to chat with you today. Mitchell I've really enjoyed it. And let me turn it back over to you and Liv.  Mitch: (29:44) Yeah. Thank you, David. And as you said, I would like to give Liv an opportunity as well to share her closing thoughts on this topic.  Liv: (29:52) I'm going to be quick here as, I think everybody and the key message here. This will take a journey. It's not a destination and answering your question very clearly. How do I stay involved? I always said show up, right? And I think showing up means within regards to our profession here is IMA has a lot of opportunity. We have the IT committee. We now have the sustainability management accounting, special taskforce. There are many articles. There are, discussions at our annual events and even at the local chapters events. So there are many opportunities to take an active role in, within IMA and other organizations. But IMA, like I said, is very well equipped for both educational and leadership role here. The second thing I wanted to let the members know is that David and I will be taking a very leadership role and will obviously invite a professional to the table.  Liv: (31:01) But we recently, under the umbrella of the impact management, where I am seconded to, it's a project for seven years to build on impact standards, right? So what is the impact? The company, not just their value creation is that, we have a grant from the tipping point and we will continue, foster dialogue and meetings over the next few, few months where we are going to map out what the plumbing with the right key stakeholders in the room. And IMA will obviously be at the table at this, but many of the world leaders and that's building on the success from cup 26 and our event there. We started out to be a dialogue around six to 15 people. We're going to have a couple of coffee and talk about digitization to the point we had to turn people away and now have a very good foundation of the right people in the room to drive these changes so that we can get the plumbing to really have discoverable machine readable, auditable data that we so need. If we ever gonna measure the impact on climate and this commitment that companies and cities and industries are doing toward net zero, we have to have accountability and accountability as data. So yes, let's do this while we are still young and the IMA has have a wonderful platform for us to drive this leadership globally. And thank you, Mitchell. I hope we with new updates that comes later on this year, that you and invite us back.  Mitch: (33:00) Absolutely. Thank you so much. Liv. And David, it really is a fascinating topic and Liv you took the words right out of my mouth. It's always great speaking with you. And I have a feeling with all this progress and work being done, this will not be the last update that we discuss. So thank you again. And, I hope you both take care.  Closing: (33:20) This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact David Wray: https://www.linkedin.com/in/david-w-29627882/Contact Lyna Kitamura: https://www.linkedin.com/in/lyndahawtonkitamura/FULL EPISODE TRANSCRIPT:Mitch: (00:05) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host Mitch Roshong. And today you'll be listening to episode 165 of our series. A Harvard Business Review study concluded that more than 357 billion dollars spent annually on learning and development did not achieve the desired return on investment. It turns out that only one in 10 used the learn skills and only one in four believe training actually improved their performance. So we must ask, is there a better way to learn the critical, personal and business skills we need? Fortunately, for today's episode, you will hear from Lynda Kitamura, a seasoned Chief Financial Officer with a background that covers multinational to startup. We will also hear from David Wray, the author of the Power of Potential, and the President of the International Group of the French CFO network, DF CG. They spoke with Adam about their view on what accounting professionals can do to accelerate the transition to effective continuous learning. A skill the World Economic Forum Report on the future of jobs concludes is critically important and will remain so through 2025. So now let's head over and listen to the conversation.  Adam: (01:25) So the Harvard Business Review findings that only 25% of learning attendees, find that what they learn improves their performance. What has been your experience with traditional learning approaches?  David: (01:37) Maybe I'll start that question then. Adam, it's a great question to really set the context for the discussion with Lynda and personally I've long believed that the traditional methods of learning are woefully inadequate, and that's because they use the same approach in terms of being an outside-in approach. Let me explain what I mean by that. So I've got this philosophy that says, you know, an outside-in approach is effectively when someone comes into a room and they start talking about their experience, the way they learn their techniques, their tools. And that's great for them. In fact, it's brilliant for them, but it's not necessarily good for me. It's not necessarily good for Lynda or even for you or anybody else. So what I talk about a lot more in what I've practiced my entire career is this idea of the inside out method of learning.  David: (02:28) And basically, let me give you an example of, what that inside-out method looks like. And I'll use public speaking as an example. So if you think of the traditional way of learning, you would end up going into a classroom, they would teach you about tone. They would teach you about pitch. Maybe they would teach you about what to wear, how to use media, how to walk around the stage and things like that. So all external things, but what they don't teach you for example is how do you harness your nerves as you're about ready to walk on stage and you're nervous. You've got butterflies. You're feeling that little bit of nausea. As you walk on thinking this, can I even do this? That's what they need to teach you. And when you look at experts in this, they've got a very specific technique for how they harness that nervousness and create a really positive energy for themselves.  David: (03:15) That's what I mean by inside out. So it's taking the things , you can't see the skills and attributes you can't see, and basically using that to develop expertise. And that's what I refer to as the visible versus the invisible elements of being skilled at something. And it helps to put this in context from the stages of learning. So if you think about learning from the standpoint of we've got this unconscious incompetence, meaning we don't know, we don't know something, right? And we all start there every single one of us at some point. And it's then recognizing that we have that gap in knowledge, and then how do we then move it from the first phase, which is not being aware to then the awareness we're still potentially incompetent in that context. And I use that term very loosely, but at least now we know we don't know something. Then we need to move it to having this conscious competence.  David: (04:08) Now we're starting to be aware that we've got a skill. We're applying it. We're starting to get fairly good at it. And ultimately when we move to mastery, it moves to a level of unconsciousness again. So then, you know, you look at experts and they can be incredibly talented. And when you speak to them and say, Hey, how do you do that? How do you harness your nerves before you walk on stage? And the typical answer you get at first is, I don't know, I just do it. And it's about how you get below that to say, Hey, how do you really do it? Tell me a little bit about what you go through so that you can start to understand the techniques that are basically hidden. So that's why I feel that the traditional outside-in approach of learning, doesn't work. So the Harvard Business Review finding's really don't surprise me from that perspective. What's your take Lynda?  Lynda: (04:53) Thanks, David. Certainly would concur , with everything that you are saying, just from my experience, I would say, to everyone that we wouldn't discount traditional learning. I think of it more as a foundation, but as David, as you said, you absolutely as an individual or with your teams need to build on it. So an analogy think of watching a cooking show versus going into the kitchen and cooking. Both important. But you do not know until you actually do something or as you say, David, you practice something or you try it. You don't uncover what you do know and what you don't know. You haven't taken the technical learning. Maybe it's your accounting designation. Maybe it's some other expertise and brought it to top of mind where it's more inside, it's more intuitive. So I would say, you know, build on, on those traditional, if you have them, because they do serve a purpose, but David, as you said, then how do you internalize it? How do you become self aware? This is what I do well, but these are my gaps and then start doing things and it can be a class or it can be practice, or if it can be a volunteer role or it can be an assignment on a board. There's ways, different ways of doing that practice.  Adam: (06:13) So you both raise some very interesting examples. And if you could choose one example to share with the listeners where you personally had the richest learning experience, what would that be and why that one? Lynda, can we start with you?  Lynda: (06:29) Let me think. an example. I think one of my best examples for myself was early in my career. So I was working with a multinational high tech company and I was very early mid twenties. And this company went through its first acquisition of a workstation company. And at that time there hadn't been processes or protocol. They said, Hey, Lynda, would you go over to this company's offices, other side of the city and just figure out how to integrate it. So I had my accounting and business degrees and I had that piece, but until I went over and learned, okay, where is your general ledger? Where are your systems? What do you do? And immerse yourself in it, you don't know what you do and don't know. About a company, about the business model, about the people, as David said, half of it is, the emotional intelligence and emotional quotient. And so I think for me, immersing myself in that unknown situation, where I was the only individual and these other 40 people were not very happy to have me there, was my best experience of an on-hand learning experience. David, I'm gonna turn it to you now.  David: (07:43) So I I agree with Lynda. Adam, I think it's really challenging to choose, but one example, right? Because when you think about your career, it's rich of examples that we've had in terms of learning. But let me give it a go anyway. I think for me, it was probably to be honest, when I wrote my book. Something that first really seemed so easy, turned out to be so much more challenging than I ever expected that it would. And the learning for me went well beyond the idea of a 10% new approach, which I tend to adopt a day to day. And what I mean by that is I just do one little thing every day. So if 10% of my day is a new learning, a new experience, meeting a new person, learning about a new process, as Lynda said, you know, going in and, seeing something different.  David: (08:31) This went well beyond that 10%. So I was probably at the 90% learning new, which was, definitely at the deep end. If I think about, for example, something that at least listeners will go through very commonly. And we all go through as accounting and finance professionals. It's one thing to write a report or to write an accounting paper, or even frankly, to write articles that are accounting, business, or transformation related. That's so much different than writing a book. If I think about what it took to write a book, I had to think about how do I elaborate ideas, really, not just superficially, which you tend to have to do when the writing format is much shorter. You tend to go over at a fairly high level, but when you write a book, you have to elaborate them much deeper than that.  David: (09:17) And you have to avoid repetition, which believe me is so much harder than it sounds because we do tend to repeat ourselves, as adults as well. And then I had to learn how to use humor appropriately. I love humor personally, but humor has to be situationally appropriate, right? Because it doesn't work in all cultures. It doesn't work in all contexts. So having to think about humor very differently. And then I had to be able to tell the story in a really compelling yet relatable way. Again, all sounds so easy, but when you actually get into it, you think, okay, how am I actually going to do this? So I also learned through that process, that I need to, or I had to get comfortable relying on experts. People that could do things that frankly I couldn't do. And I think that's a big learning in terms of going through career is knowing when to lean into the expertise of other people and accept that it's something we don't have ourselves.  David: (10:11) And I learned that probably the quickest through the editing process. In fact, one of the editors I had when I did the book and by the way, when we think of editing, I personally thought of just one editor. No, no, it doesn't work like that. There's a structural editor who helps set the structure of the book. So it actually makes sense. Then there's a different kind of editor that helps with the flow to make sure it all sounds cohesive and works together. Then there's a third type of editor who ends up correcting things like the spelling mistakes and the grammar, very different skill sets. And the best learning I got was from the structural editor, who frankly, when she gave me feedback on the book at first was she said to me, look, David, you've got a couple of choices. You can either go with the format that you've got, which is effectively talking about the inside-out model.  David: (11:01) And then the second part that I talked about in the original version of the book was how to build a business out of it. Because it's something I had done before, and that was the approach, I submitted in and she said, you could do that, but she said, how about you do this? How about you keep the first half of the book, which is great. And then talk about the second half from the standpoint of building it into your own life. And then talking to people about how they embed the technique in their own life, rather than talk about how to build a business. And I did that and it turned out to be a great decision because the book has done really well and it's relatable. So I think that was the learning I had as well as how do you take feedback in the spirit it's intended because it's designed ultimately to help us, right?  David: (11:43) And if we take it from that standpoint, we can end up with a much better product, which I did, and it can also provide a springboard in my case for the next book, which will end up coming out next year. So for me, it's all about being open to learning, open to change, and really seeing the whole thing as one big adventure, no matter how challenging it looks. To Lynda's point, you know, whether you walk into an acquisition or you walk into a book, it's how do you look at it as look, this is one big adventure challenge. Let me take it on.  Adam: (12:12) Now, one thing that I picked up from, our conversations that we had together, was that you two have been working together for many years and become friends and maybe I could start with asking what was one memorable thing that you did learn from each other working together and how has it impacted you now? And David let's put you in the hot seat since you reported to Lynda.  David: (12:35) Oh, thanks Adam. Nothing like being in the hot seat. So you're right. In all serious, you know, I really learned many, many things from Lynda or perhaps the most memorable one that I learned was how to be an empathetic leader. If I think about the fact that we spend hours together in meetings, honestly, sometimes some of those meetings were quite challenging, especially when we started talking about revenue recognition. And can we recognize revenue? Why can't we, and is there a way around that, or if we think about the country balance sheet review processes that we went through, where sometimes there was an item in the balance sheet and lots of questions came out and sometimes those questions were difficult to work through. And sometimes the opinions differed quite a lot as well, and they could become quite strong and do so quite quickly.  David: (13:21) And it was really helpful to watch Lynda go through this process and see her really skillfully maneuver through different motivations and think about how to connect with people wherever they happen to be as opposed to asking them to connect with her, where she happened to be. And frankly, she made it look effortless, right? In terms of putting yourself in the shoes of other people and, and being able to see why they were coming at something from the way they did. And she really took the time to explain, you know, why she thought a particular approach was perhaps more helpful or more important in the context of what we were doing or perhaps that it was unimportant, depending on the situation. And I think it's probably fair to say, and Lynda might disagree with me, but I think it's fair to say that she probably, didn't realize at the time that she was actually modeling the inside- out learning approach, that I ended up writing about in the book.  David: (14:16) So she clearly was an early pioneer, knowingly or unknowingly, and really helped me see things I think through a very different lens. And she taught me that when we start to understand those hidden motivations for doing something and how we can tap into that, then frankly we can learn any skill and perhaps the most valuable of all skills we can learn just having that mindset. And that approach is the skill of learning skills. And this is something that's been talked about by many, including the world economic forum as well. So in other words, we're on a path to continuous lifelong learning. And I think if there's one thing I've taken through my career and, Lynda has been a strong supporter of, is that lifelong learning is really important. And if we remember what I said a little bit earlier about the hidden attributes of skill mastery, when we can embed both those visible and invisible elements of the skill that unconscious part of the brain, then it becomes something that we just do, right? It's a little bit like when you drive your car home and you're not consciously thinking about the roads that you're driving down, you're not consciously thinking about the trees you're passing or the other cars on the road, other than obviously for safety, you're just doing it because it's imprinted as part of your brain. And ultimately you intuitively know where to go, you know what to do. So by learning how to model skills, frankly, I've ended up becoming a better leader myself. And I think Lynda is a big part of why that's happened.  Lynda: (15:47) Wow. Well, thank you, David. I think that I'll just sign off the podcast now. That was lovely. Yeah, kidding aside. But I do very much appreciate those thoughts and it is a mutual respect. And I think, Adam, when you ask, what have we learned from each other? I certainly have valued from the beginning in working with David, especially in finance and accounting. It takes a lot of courage for one to do what we know is the right thing. And, so, I've always said to my finance team, you know, be prepared to lose your job, to stand up for the right thing. Misreporting or misrepresentation of financials is one of the fundamental problems and risks out there. And so having the courage to know what is correct reporting, what is correct accounting, and to stand up for it and you have to build for yourself before you get into that situation.  Lynda: (16:46) And David does this and I've done this, and this is why we work well, that we recognize that you have to know you're going to stand up for the right thing before the situation comes up. You can't decide in the moment what you're going to do because you get confused. And, the other is you build resiliency in your life so that you're not so dependent on a job that you haven't set a little bit of savings aside that you, can get by week to week that not easy. Like this is not, I don't say that lightly, but try and live within your means. This isn't a financial podcast, Adam, I promise you, but it is these kind of steps to build resiliency, allow you to be your best and allow you to make the right decisions. And I would also say, you know, learning from David and, seeing what he does, enthusiasm and risk taking.  Lynda: (17:38) Now you can hear the enthusiasm in his voice and writing the book and just how much he put into that. So what does enthusiasm mean? It means being engaged. It means doing the research. It means caring about learning new techniques and then figuring out how to articulate and share them with the people around you. In David's case, writing a book and risk taking. But we're all busy and we're all sometimes afraid of doing more or doing something that's new and uncomfortable. Again, great example in David taking that on when he already had lots of other things on his plate. So I would say Adam, you know, these kinds of things, you look at your friends that you admire, look at your colleague that you admire and, pause. What do I admire? And then see if you can embrace it yourself.  Adam: (18:25) So here's a question, a little outside the box. What if you're in a situation where you don't look up to any of your colleagues inside of your workplace? What, you know, is that a reason to say, you know what, maybe I should go somewhere else where I can grow.  Lynda: (18:42) So I'll start with that one. and it's such an important question. I would say, yes, Adam. So , if you are feeling uncomfortable, pay attention to your gut, and then you consider, why am I uncomfortable? Is it something that can be addressed and managed? And if so, how would I go about it? And what would be the avenue where I could find someone in the company who shares my value set and would be a good, safe, founding place to address it. If it is a situation where it's not addressable and you've underlying concerns. And I think it is absolutely appropriate to say, do I need to remove myself from this situation? So those are very fair. And, we will all come through. I have gone through my career two or three conversations where I thought I'm gonna get fired today, because I know they're not gonna, like what I'm going to say.  Speaker 4: (19:40) However, I tried to go into those rather than just a, no. It was, we can do A, or we can do B unfortunately C is off the table. So let's talk about A and B and it just took the conversation. Granted, you pulled it back a few times to what you can do, and then as opposed to deliberately focusing on what you can't, I would just say the, last, piece of it, and I'll turn it over to David, is that in every situation, even when I was in high school, I was working in a part-time job and it was just not a great company. The processes were bad. And what I learned was what will I not do when I am someday in a position of influence. You can always learn, if you can't learn anything else, what can you take away that you won't do yourself when you have that chance. There's always learning. So David, over to you,  David: (20:35) You raised some excellent points. And I think Adam, to answer your question really simply I think if an individual, a listener is in an organization or a role where they just don't see any role models, I think to be honest, I think the easiest thing to do is definitely dust off the resume if it's not already polished. And that would be one piece of advice I would always give - I've given it to my staff my entire career - is always be market ready. And I think this is one chance or one situation where being market ready is very helpful. Because if we can't look to the individuals around us, in a workplace setting and feel some sense of pride, relation, connection, then I think we're not in the right culture. We're not in the right environment. And I think we do need to look for alternatives.  David: (21:22) I think all of the suggestions that Lynda's made are absolutely spot on. And I agree with them. I agree, it's hard sometimes to do the right thing, to make the tough calls, because to realize that we're in the wrong environment means we have to leave. And that puts us back into a risk taking position as well. Potentially we have to, you know, start all the way at the bottom, depending on where we are in our careers. Sometimes we do, sometimes we don't. But all of it is significant change, and all of it needs to be adopted, but they're all important skills to learn, right? Because the more resilient we can be in our lives, whether it's personally or professionally, the more successful we will end up being. And the more likely we are to choose environments and roles that fit for us, right. We don't feel compelled. As Lynda said, I remember taking that first part-time job at as well as a kid thinking, oh, I never want to do this when I grow up. And it was more this idea of just realizing, okay, if I want to do something different, I have to take control of what I do, and I have to be responsible for the decisions that I make. It's not down to anybody else. So I think ultimately just having that mindset from a very early age is very helpful.  Adam: (22:29) Definitely. And you guys have a very rich experiences in your career, you know, I think that was a nice segue to, you know, what would you offer individuals who are starting their career or midway through their career, or even contemplating a career change to kind of help them prepare for the next challenge. And I think we kind of started that with that last question, but, Lynda, maybe you can dig into that a little bit more?  Lynda: (22:49) So when, people look forward and a career change or a career decision is one of the biggest things that people struggle with and, deliberate on for all of the right reasons. So if you're in a role and let's say, Adam, you're in a role for five or six years, and you're thinking, should I make a change? One role of them to, ask yourself is, well, if I spend two more years in this role, what will it look like in two years time? What will I have learned that I haven't already learned? Maybe there's a lot? Maybe not much? What will I have added to my experience to what will I have practiced? And if there's a lot of change or opportunity coming, then you may say, yeah, I can see how the next two years will play out.  Lynda: (23:36) And at the end of that time, what I will have had a chance to try or to experience or to do. On the other hand, I've had many people say, you know, another two years of the same rule, I really won't have much more experience than now. And that's the first good tip to themselves that it's time to try something new. Sometimes the change is forced upon you. Like through mergers and acquisitions, and then you're in a new role you may be asked or you just be given, and this is your new role. And you're thinking, do I want to stay in it? Do I even want this new role? I had that once through when a major merger of the company went through and I was given a lovely title, but almost all of my staff was moved to other lines of business.  Lynda: (24:18) So I was expected to do the CFO role without all of the normal tools or people. And I had to do it through influence for the most part, apparently, but ultimately I decided, you know, can I learn something in this new role? And can I contribute? I boiled the situation down to those two questions. Can I learn? And can I contribute? If so, I will give it an another 12 months and let me see how it unfolds. So it wasn't an open-ended, it wasn't decide right now, it was, if it met those two criteria for me, can I learn and can I contribute? I'd be willing to see how it played out. It actually, I did stay, it played out beautifully, eventually moved to an America's and worldwide role. But in the moment crystallize your personal question is, and if you can achieve something in it, then, it's good to go for. And if not, then you move to a plan B and look for something else. And so, and David, with that, I think I'll turn it over to you.  David: (25:21) It it's interesting as you were relaying that story, Lynda, it reminded me of when we worked together. I was just wondering, was that about the same time that I was facing, or I was being taught to take a global role where you were losing me as part of that as well? Because I know we had , a conversation about that because I felt pulled, between staying with the local team, which I absolutely loved working with as opposed to going into a global organization where the influence certainly would be more, but I would have to reestablish all of the relationships. So I remember going through that at the time and you and I talking about it. So it's good segue.  Lynda: (25:58) Yes. That was the time and lots of change and lots of personal self examination. And then trying, you never really know, do you David, where the company is gonna go? All you can do is assess and then do a little bit of a leap of faith. And if it fits with some of what you feel you can learn.  David: (26:17) Yeah, absolutely. And you are right. It ended up working out really well for both of us in very different ways. And here we are today doing our podcast together. I'm very much like Lynda, I'm a forward looking eye. I really do look ahead as well. I probably do it slightly differently from Lynda. I tend to do a little bit of a longer term approach. So yes, I do look a year ahead, but I also look three to five years and more ahead as well, because some of the changes that we might want in our life might take quite a while for them to materialize. So one of the techniques I use is actually a very cool technique that was created by Walt Disney himself. And he created it for his organization to help with creative thinking, forward looking, and just this idea of dreaming.  David: (27:01) And if you think about the organization, it definitely needed to thrive on creativity, given what they created, but effectively his model was morphed to use in business. And it's called the Disney strategy. And it's a three step strategy basically. And this works, whether you're talking about your professional life, whether you're talking about your personal life. And it's really saying, well, whether I'm at the beginning of my career, the middle of it, or the end, doesn't really matter because at the end, you're just going to a new chapter. It's just a whole new set of experiences, right? That still need a plan that still need an idea and an approach and a roadmap. So basically the approach starts like this. We start by thinking through very vividly, what is it that we actually want? You know, can I picture exactly what I want to achieve, whether it's where you want to live, where you want to work, whether it's have your own business, work in a company, it doesn't really matter what it is.  David: (27:52) It, as long as you've got some level of passion for it, and that you can see very vividly how it's going to unfold. So you can imagine it happening and you can see yourself in different facets of it. That's what we refer to as the dream phase, right? It's the whole creative idea in that place we don't think about, is it possible? This doesn't even come into the realm of thinking everything is possible when we start talking about dreaming, right? So we go in with that mindset, which is great because you can effectively dream anything. The second stage that we go through then is a little bit more into reality, which is okay, I've got a dream. Wonderful, but now I need a plan. I need to actually make it happen. So then we move into this mindset of putting together a plan to make the dream come true.  David: (28:36) So in that phase, we're not thinking about whether the dream is realistic, whether or not it's achievable. Of course it's achievable because now we're just about planning. So the plan is about achieving whatever the dream happens to be. And then when we've gone through the plan and we think the plan is fairly robust, we then move into a third mindset, which is why it's a three step model. And that third mindset is all about critiquing. Now this is when we look at the plan and this is where as, accountants will be brilliant at this. We poke holes in the plan. We find flaws in the plan and this we're very, very good at. So we are not again, trying to solve the problem. We're just trying to point out weaknesses, gaps, or issues that need addressing. And then effectively there's this back and forth process we go through where we change mindsets between planning and critiquing until we get it to the point where the critique can't find any more holes or flaws or risks in it, it says, okay, the plan is solid.  David: (29:32) And then effectively we can end up then executing on that plan. And you might say to me, well, have you actually ever used the plan? You talk about it, but have you ever done it? And the answer is absolutely when I first started my career. And again, I didn't realize it was called the Disney strategy back then. When I first started my career and I first looked at this, I had in my mind a plan around what I wanted to do with my career. And I literally said, okay, from entry job over the next 10 years, what do I want to achieve? And I set out a concrete plan for myself around starting as an individual contributor, moving up to a team leader, then a supervisor, then a manager, then a director, you know, kind of the traditional path, if you will.  David: (30:14) And I narrowed it down to four companies. That's all I put in my plan now, in retrospect probably wasn't enough, but at the time it seemed to work out quite well because one of the companies on that plan, I ended up joining and it's ultimately where Lynda and I ended up meeting. And I went after that plan relentlessly, I used every lever available to me to make that plan happen and it did. And ultimately it ended up leading to a career that's become, incredibly fulfilling and I've been able to do, as Lynda said, lots of other things that have allowed me to actually tap into a passion, which I have, which is speaking and being able to share things with other people to help them in their careers. Because funnily enough, as I get a little bit older, I find that the more I can help others, the more fulfilling I find this experience.  David: (31:02) So, you know, when I think about my early career and you think about, it's all about title, it's all about money for a lot of people, not everybody clearly, but certainly it was for me when I was young. And then thinking through, as I got a little bit older thinking, you know what? Those things actually don't matter as much anymore. What matters to me is that I feel fulfilled and I feel a sense of purpose us. And ultimately, you know, am I living the kind of life that I want to be? So what's all that taught me then at the end? It's really taught me that ultimately every experience we go through, as Lynda said earlier, teaches us something. The key is to be open, to listening to what it teaches us, and making sure that we don't lose that lesson and that we embody that, in everything we do after.  Adam: (31:48) I think that's great advice, David. Being open and willing to listen to just about anything is huge for everybody. And so, as we kind of wrap up our conversation and, David, you've already talked about how you like looking into the future. And as, our listeners know, when we talk to David, he always likes to finish about talking about the future. So what's some parting advice do you have for our listeners on the skills they should be thinking about to future proof themselves? Because we have an everchanging industry, you know, COVID 19 is becoming COVID whatever, and there's so many different things happening for everybody in the world. What should we be doing right now? What should our listeners be doing as we look to the future?  David: (32:31) It's a great question. And you're right, Adam, I really do love finishing on a forward looking question. So yeah. What can accounting and finance professionals do? Well, there's a few things that we can do, right? In fact, we have many choices. I think as Lynda said a little bit earlier, it's really embracing a willingness to take control of our choices, whether they're personal or professional, right? Because at the end of the day, we alone are in control of our lives. Yes, events happen around us, but how react to them is entirely within our control. What we learn from them is within our control. So I think if we own things, we plan for them, we execute them. And then we savor the successes, no matter how big or small they are. That's important again, you know, Lynda gave me some advice many, many years ago when I was doing far too much.  David: (33:18) And she said to me, one day she said, David, do you celebrate these little things that you go through? And I sat and I thought about it and thought, you know what, no, I don't. I just go on to the next thing. So I think that's one thing that I've learned is really important because it also creates this sense of purpose and that we are not just going from one fire to the next. the other things I would say to our listeners are really think about learning from the inside out. So really think about getting below the skin, so to speak and adapt our learning, to be able to leverage our own strengths, our own preferences and our own personal style. What works for me doesn't necessarily work for everybody else. And that's okay. But it's about learning from other people to get different perspectives, to then figure out how do we embed and emulate what we wanna emulate and what we wanna model.  David: (34:11) So it's really learning it from that point of view, but doing it in our way. And that's why the inside-out learning model is so effective because we do customize it to how we are as individuals. And I think I would always say to have fun when learning, it makes it so much easier to assimilate learning and to retain it when we're having fun, when we're laughing about it. It's amazing when you laugh at a movie, you can actually recount the movie so much better than if you watch a very heavy movie and you think, oh, I need to, you know, that was a heavy movie within a day or so. You'll forget most of the movie, whereas if it was funny and it had you rolling around laughing, you'll remember a lot of the movie, because again, it's quite relatable. So I would say, because in truth, we can't afford to wait and see what happens. We've got to start and be much more assertive in our roles and in our own learning and development. And as I mentioned, it's really about finding passion and purpose. And then it doesn't feel like work. The whole thing feels really enjoyable and it's great fun. And you meet great people along the way. So I would say those are probably my parting words. As I look forward to help individuals, Lynda, what are your thoughts  Lynda: (35:20) On top of that, and I agree with having fun and learning, every day, my suggestion to all of the listeners is invest in yourself every day, every day. If you think about, what you can learn and what you can do, it all comes from within and the, and the inside of David that you write about in the power of potential and you speak to. Think about it when you're on the airplane. Remember when you get on the airplane and you're giving the advice and you're buckling up, what do they say? They say, put your own mask on first, if you're in an emergency situation. And that's where the invest in yourself is one of the best things you can do, cuz we don't always know the future. We can look for trends. We can keep informed. Here's a really easy one.  Lynda: (36:07) When I guest lecture to MBA programs that I share with them when they, when we first open a class and I ask them, what's the headline today in let's say it's a finance or accounting group like this, the audience, what's the headline in the business section? And a lot of times they'll be spending thousands and thousands of dollars doing this degree. And they don't know what the headline in the newspaper is. And this is the one easy, easy way to invest in yourself to spend. And now you don't have to subscribe to a print newspaper. You can listen to a podcast like Adam's doing with us today. You can go online and look at digital information. So there's no cost, take 10 minutes, find a headline that interests you and then say, how would I explain this to my neighbor?  Lynda: (36:55) If I'm down in the lobby or if I'm speaking to, you know, my family at dinner tonight, what are the sound bytes of, this situation. This is the company, this is the issue. This is the impact. And here's what I think about it. What do you think? If you can take an idea and invest in yourself by learning and articulate it in a few sentences, you have just given yourself a gift you've invested in yourself and you are going to be well equipped. And Adam, to your question of, you know, for future proofing ourselves, I think the best way to future proof is to stay current. Stay curious.  Closing: (37:37) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Gordon Van Wechel: https://www.linkedin.com/in/gordonvanwechel/Email Gordon Van Wechel: gordon@thealchemyconsultinggroup.comFREE DIGITAL DOWNLOAD! Gordon's best selling book "Core 5® Marketing": https://bit.ly/Core5BookOffer-IMAwww.thealchemyconsultinggroup.comwww.alchemytransitions.comFULL EPISODE TRANSCRIPT:Adam: (00:05) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson. And this is episode 164 of our series. Today's featured guest is Gordon Van Wechel. Gordon is president of the Alchemy Consulting Group. He is a business marketing strategist and he helps firms recognize the true business value, grow their business, and provide strategic support to professionals in business. In this episode, he talks with Mitch about the value of working with an agency and the benefits that come from proper advertising. Keep listening as we head over to the conversation now.  Mitch: (00:49) So Gordon, thank you again for joining us. And, you know, I just want to start off our conversation by asking, in your opinion, your experiences does a professional practice need to have an agency working for them?  Gordon: (01:02) Well, at the risk of sounding a little bit, self-serving Mitchell, because I do run an agency. I'll answer the question with a yes. But let me give you some reasons why I say that. There's such a multitude of marketing channels available today. If you think back just 15 years ago, you know, a practice had, you know, the yellow pages, they worked off of referrals. Google was in its infancy, YouTube hadn't been invented, social media, wasn't a factor, you know, they could do radio and TV, but there just wasn't that much to choose from. So it was relatively easy to get the word out. That's changed today. I mean, it would be easy for you and I in two or three minutes to come up with 50 different effective marketing channels that a professional practice can use and, and be effective. Now a lot of times when I speak with professional practice owners, they'll say, well, you know, my business is referral based, so I don't really need to do any advertising.  Gordon: (01:57) What they don't realize is that there are multiple surveys out there that say that between 85 and 90% of the people who are referred to a business will first go online and they're looking for two things. They're looking for the company's website, because that kind of proves that they're legitimate and, and they want to look at that about us page and see who they might be dealing with so they select that company. But the other thing they're looking at is the reviews. That social proof has become critically important in the mind of a prospect because they want to know that the vendor they're considering is doing an excellent job with their current client and is likely to do an excellent job with them. Well, putting all of that together, managing `that diversity of channels and keeping up with the testing, knowing where their prospects are going for information updating of campaigns, you can't legitimately run a practice plus do all of that. So for those reasons, I think that having an agency is important even for a smaller, professional practice. But the caveat to that is to find an agency that understands your business and that's willing to work with you where you're at with the budget that you have available at this time and grow with you.  Mitch: (03:13) So I think you've probably already addressed two of the answers or possible answers to my next question. But you mentioned, relying on referrals and then potentially budget concerns, my next question is what are some of the biggest mistakes that you see professional practices make for those that do pursue some form of marketing? You know, what are some of the obstacles or challenges that you find to be most familiar?  Gordon: (03:41) Sure. I think one is not having a really clearly stated value proposition in their advertising. You know, the value proposition is why should I choose you versus the multitude of other firms that are available to me in the local marketplace? Something that we enjoy doing with a new client or even a prospect is we'll have them open up their website and take a screenshot of the homepage, the portion that's above the fold, that a prospect can see when they open up the website, take a picture of that and print it out and then do the same thing with four or five or six of their competitors. And what they'll be surprised to see is how similar all of those websites are. You know, they all promise the same things. They all use the same platitudes and generalities. Many times the only difference between those pages is the phone number.  Gordon: (04:31) And if that's the case, then what your prospect is left with is the impression that everybody is the same. And if everybody's the same, all that prospect's going to be concerned about is who is going to give me the service for the cheapest price. And, that's a war that I don't want to get into. And I don't think many business owners do. Nobody wants to be in the race to the bottom. So not having that clearly stated value proposition and in today's marketplace, the absolutely most effective way to state that is in a little short, 60 to 75 second video of the business owner looking right into the camera and saying, here's who I am. Here's who my firm is. Here's what we do. And here's why you should consider using us. And just 1, 2, 3 bullet points, you know, whatever that value proposition is and state it as clearly and succinctly as possible and literally in 60 to 75 seconds. Any longer than that and people aren't going to listen.  Mitch: (05:29) So taking that a step further, what is the most overlooked marketing channel professional practices could be using more effectively based on what you just shared, it feels like potentially a lot of practices are very interested in the social media, maybe? Maybe their website is their go-to, you know, from your experience, what kind of gets overlooked and really should be focused on better?  Gordon: (05:51) Well, let's assume that a firm has a decent, basic website in place and it doesn't have to be a 10 or $12,000 major investment. It's got to be something that, as I just said, states their value proposition clearly and gives a person some insight into what the firm stands for and who some of the people are. Assuming that's in place and they have a Google business page that's in place and optimized that's the foundation. The next most overlooked step is retargeting. Now retargeting is a form of paid advertising. If you're not familiar with that term, you've certainly experienced retargeting. If you've ever shopped on eBay or Amazon or, really most any of the major retail websites anymore, you look at a product, but you don't buy it. You see ads for that product for the next week or 10 days. Well, you've been retargeted.   Gordon: (06:45) Retargeting, I like to tell our clients is the single most powerful advertising you can do because it makes all of your other advertising more effective. And if you think about it for a minute, most of us, when we do marketing for our company, we're trying to drive traffic to that website. That's our 24/7 salesperson. But when people visit that website, Google will tell us that 96% of the time, they don't take an action. They don't fill out a form. They don't click to call. If you have those links on your site, they don't pick up the phone and call. They leave. Well with retargeting, you can keep your brand, your business name in front of them for a period of time, a week, 10 days, two weeks, however long the normal person takes to make a decision for your product or service. So retargeting is critical. Related to retargeting are banner ads.  Gordon: (07:41) Now banner ads are similar to retargeting ads. They look the same. They're ads that you see on websites, but with the sensory economy that we live in today, we can really very finely hone in on target markets with those ads. And I was doing a presentation a couple of weeks, a live presentation. And I joked with the audience that if they wanted to target housewives between the ages of 35 and 45 with two children at home who drove a Volvo and ate Yoplait yogurt, I could put them in front of that audience in their town. That's how precisely we can target things these days. So for a professional practice that understands who their customers are, we can very easily expose their brand to those customers and prospects through, banner ad campaigns. And then the other aspect of paid advertising is Google ads.  Gordon: (08:32) And a lot of firms have had a bad experience with that, but that's because of the complexity of Google ads. And that, again goes back to your first question Mitchell. If somebody's going to launch down that path of spending money with Google, they really want to have an experienced agency managing that for them. But I think the most overlooked marketing channels are paid ads. A lot of companies will jump into search and to optimization and I'm not going to minimize the importance of that. But the reality is that's a long term play. You can spend a lot of money over eight to 12 months to get some of your keywords, highly ranked on Google. And a lot of firms don't want to spend the money and not get the more immediate ROI. Well, this paid advertising campaigns will give them that immediate ROI.  Mitch: (09:17) Now, obviously this is paid advertising. So we're looking for the firm to spend some kind of money with an agency to get the name out there. You also mentioned just recently that one of the bigger mistakes that some businesses make is potentially going out of budget or, you know, not spending money in the right place with the right agency or such. So when it comes to firms and a lot of our listeners work for those smaller businesses that you were discussing earlier, you know, what would be an appropriate practice for spending on advertising?  Gordon: (09:50) You know, a lot of agencies will tell you spend as much as you can, or they'll come up with some trite phrases as well. If you spend a hundred dollars and get $110 in return on it, that was a good spend. Well, that makes no sense at all. You know, that doesn't cover your cost of goods or your labor, your operating overhead. What we consult with our clients is to first understand what's the average transaction value in your company. And just a very simple example, let's say you prepare tax returns for $500. Now that's low for a business return, I understand, but just as a round number, let's say you prepare a tax return for $500 and you keep a client on an average for five years. So that's $500 a year, times, five years, that's $2,500. So the lifetime value of a client in your practice then is $2,500.  Gordon: (10:41) So the advertising budget question is how much are you willing to spend to acquire a $2,500 client? And frequently firms will spend more than the initial transaction value to acquire that client because they know that the average is $2,500. Now I've had people throw up their arms and say, oh, but we don't keep everybody for five years. And that's true, but you also keep some for more than five years, we're talking averages here. And the $500 example is overly simplified because most companies, multiple tiers of services and products that they offer. So you have to figure out what your average transaction value is in each of those tiers and, and judge it accordingly, but to calculate your budget, you want to really understand those numbers. And then you, as a business owner have to determine how much are you willing to spend to acquire that new customer. But here's a rule that we found to be true. I mean, in the 18 years we've been in business and I think it's true across every market niche, you know, finance and accounting, home improvement, trades, medical practices, the company that can spend the most to acquire a new customer will win the market share battle every time. And the only way, you know, what you can spend is to really understand that transaction value and lifetime value of the customer.  Mitch: (12:08) Now that makes a lot of sense. And the example you shared well, maybe oversimplified certainly makes it very easy to, translate to whatever the business is that our listeners are working in. As I said, you know, we focus on finance and accounting professionals. We have a lot of small business listeners. We also have those who, if they're in business on their own or aspire to be entrepreneurs and in business on their own, a big part of that is kind of, you know, taking one project and then going on to something else down the road. Right? So I think a big question is if I'm running my own business, I'm focusing on my own marketing, so on and so forth, but this is not my lifelong play. You know, I have some aspirations of potentially moving on to something else. What should I be doing today? What kind of consideration should I have short term or long term for the, you know, the sustainability of the business as it is now getting ready to move on to the next phase of my own business?  Gordon: (13:05) Yeah. I think all of us start businesses do so with the ultimate idea that we're probably going to sell it, you know, we're going to fund our retirement or our kids' education or whatever, or, we're just entrepreneurs and we want to do something different in life. And what we see in the alchemy transition side of our business, where we help business owners prepare their businesses for sale is one consistent fact is as business owners, we tend to use a rear view mirror. We look back with understandable pride on all of the things that we've created, the people that we've developed and the market that we've developed, all of the things that we've done to make our company, the profitable enterprise that it is. But a buyer doesn't care about that. A buyer is looking at what's the future cash flow of this business if I own it.  Gordon: (13:54) And what's my ROI going to be based on the amount I spend to acquire it. So when we consult with business owners who are thinking about transitioning their business in the next three to 10 years, we have eight different value drivers that we use to help them prepare that business for sale. Let me just summarize a couple of them. You know, one is recurring revenue. Recurring revenue is not the same as repeat business. Recurring revenue is where you have people that have committed to paying something every month or every quarter for your services. I'll give you an example. We are working with a CPA firm who has a focus on a niche with real estate professionals and real estate investors. And so what we've done is helped them create three tiers of support for those customers, depending upon how many investment properties they own and how much consultation they need during the year in terms of tax planning.  Gordon: (14:53) So there's three different tiers of support, three different monthly payment plans. Well, what that's done is converted a lot of their regular customers over to those monthly plans because they want that increased level of support. It's not just, here's my paperwork. Please repair my taxes. It's, okay I'm buying these next three properties. How do I need to structure them? I'm selling four properties this year. How are we going to make sure we don't have to overpay on taxes? So by creating those tiers of support, it has created a much more sustainable relationship with those clients. And in turn created, an increased value to their practice. Hub And Spoke is another tool that we use. Most businesses tend to revolve around the owner. The owners are involved in all the hiring decisions, they're involved in sales, they're involved in most of the customer transactions that they're the hub and the rest of the firm are the spokes of the wheel of their business.  Gordon: (15:53) The rule of thumb we use that is if you, as the owner know more than 15% of your clients by first name, you would recognize them if you were at the grocery store and you would call them by first name. That's not a good sign from an acquirer's point of view. The reason being that, that means there's a lot of customer loyalty to you as the business owner. And that may bode well for me as the acquirer, it may not. I know when I'm gonna acquire a financial practice, I'm probably going to lose 20 to 25% of the clients, or at least statistically, that seems to be the norm. But the more I can show that the current owner isn't the focal point for those clients, then that relationship isn't the strength of the firm. The better my opportunity is to enhance my return on acquiring that firm and therefore the more I'm willing to offer for it. So the focus of that part of our business is helping practice owners understand how their business is going to be viewed from an acquiring company or individual, and try to set it up to be the most appealing to that person as possible.  Mitch: (17:03) Very interesting. And, considering that dynamic of a business, it would make sense that you would like to see the operations and the organizational core values translate across the organization, right. Not just be, personified by one individual. So thank you for sharing that. I do have one question as a follow up to kind of wrap things up again, gearing back towards our listeners in finance and accounting. I know you said you do work with a number of firms in that space. I'm just curious what you kind of envision as far as how finance and accounting firms specifically can differentiate themselves, you know, going back to what you said earlier on, some successful practices, best practices, things like that for our listeners who may be looking to utilize some marketing to get, an extra step up on their competition.  Gordon: (17:55) Sure. Well, one is to identify a niche where you have expertise. I just used an example of a CPA firm that had a lot of experience working with real estate investors and real estate professionals. When we started with them, they had a generic website that didn't say anything about that, even though a good percentage of their clientele were in those niches. We wound up creating a completely separate website and doing marketing directly at those niches and they saw a 25% increase in firm revenue, the first year as a result of focusing on that niche. So I think for a lot of firms, they have areas that they either enjoy working or have specialized expertise in. Maybe it's it's nonprofits, maybe it's building trades and doing job cost accounting. I mean, maybe it's retail, but really focus on what your expertise is and then identify markets that you can enhance. That you can go penetrate with that expertise.  Gordon: (18:55) Another thing that you can do is consistent follow up with your clients. Most firms work really hard, five months a year, and then the rest of the year they're finishing up some business returns. They're are not following up consistently with our clients and really involving them in tax planning. They're not becoming the valued professional resource for their business clients that they could. And I think when they start to do that, they increase the relationship as well as the revenue from their current current client base. But they also generate a lot of additional revenue because they're providing that extra value add. So those are two things that come to mind that a practice can do immediately and that's even a small practice.  Speaker 4: (19:43) This has been Count Me In, IMA's podcast providing you with the latest perspectives about leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Stacey Ashley: https://www.linkedin.com/in/staceyashley/About Stacey Ashley: https://ashleycoaching.com.au/about-stacey/Leading Possibility: https://ashleycoaching.com.au/FULL EPISODE TRANSCRIPT:Mitch: (00:05) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong and this is episode 163 of our series. Today's featured guest is Stacey Ashley. Stacey is a high performance leadership and coaching expert. With over 30 years experience, Stacey has helped thousands of individuals develop their leadership, competence, confidence, and credibility. In this episode, she speaks with Adam about creating your own positive mindset, developing resilience, and developing accountability in others to learn more about these leadership skills, among others, keep listening as we head over to their conversation now.  Adam: (00:51) Stacey, thanks so much for coming on today with us. I really appreciate you joining our Count Me In audience. One of the most important factors of great leadership is having a positive mindset and resilience. So can we talk about how one goes about creating that mindset and developing resilience?  Stacey: (01:09) Yeah, and isn't it important right now after the last couple of years? I think more than ever. So look, there are so many things that you can do, but for me it's kind of like keep it simple and I think that there's some really straight forward things that everyone can do for themselves. There's some people of course kind of come with a positive mindset, which is great, so just keep going. But for those who need a little bit of help, I think, it's kind of noticing the little things. So noticing, what you do well or something great that happened today. Really you can be quite deliberate. You know, I have a session with my team every week where we actually deliberately go "what were our wins this week?" And we can kind of accumulate them, and we keep track of them.  Stacey: (01:51) So if we're having a bad week, we can always look back and go, there was some really good stuff that we've been doing. And so let's focus on that and that kind of keeps us buoyant and positive. But I think the other one, that's really important is just to remind yourself of all of the incredible resources you have and the strengths and the great things you've done in the past. And I know a lot of the clients that I work with, I kind of get them to journal it, even if they're not big on journaling, but just to start to keep a little bit of a track again. Once a day or once a week of, you know, things that they have done well or that they have accomplished or, made progress with and sort of creating that evidence of you know what, I can do this, look at this track record that I've created of things that I've been able to do or overcome, or, you know, rise to achieve.  Stacey: (02:42) Because when we are having those kind of down days and we all have ups and downs, but you know, when you have those down days, you can just open your journal and go, actually, you know what? I can do this. Look, I've done this before and I've done that before, and I've learned all these things. So I think sometimes it's just making sure that we keep balance for ourselves because often as humans, we kind of focus on the things that don't go well, are a bit negative , and those sorts of things. So we want to offer ourselves some balancing out of that. So if you start to, kind of notice the things that do go well, what you are capable of and create that history for yourself, you're balancing your own conversation. I think that alone really allows you to then kind of rise and sort of bounce back.  Stacey: (03:26) I remember, my kids a couple of years ago, well, a few more actually, when they were little kids, they did a resilience program at school and it was called bounce because it was recognizing that we don't all stay up and positive all the time. We all have ups and downs, but it's the ability to bounce back up that actually creates that resilience opportunity. And so I think if you can do that for yourself, have that evidence of your ability to cope and have great strategies and make progress and that sort of thing. I think that takes you a long way to developing that positive mindset. Because you've got all those reminders right there for you.  Speaker 2: (04:03) Yeah. Having all those reminders is important because, you know, I was thinking, as you were saying that, you know, we do have lots of ups and downs. Nobody can be positive all the time. So are there other strategies besides, you know, not everybody's good at keeping a journal, are there other strategies that, to deal with those ups and downs as you're working through that?  Stacey: (04:22) Yeah, I think so. As I said, even just noticing things in a positive way. So just asking yourself questions in the positive, you know, what did I enjoy today? What was good about today? What was one good thing that happened today? So just in the moment you can grasp, you know, that positive element, I think, you know, other things that we can do, certainly what I've noticed in the last couple of years of course, is that goals have not been achieved. Like everyone has goals in different ways, whether they articulate them or not. And organizations certainly had lots of goals and for lots of reasons, we didn't actually make them right? Because the world changed and a lot of it was out of our control. And so for, many people, teams and organizations, they can feel like we sort of failed.  Stacey: (05:07) We didn't make it and that's not great for your mindset. And so I think a better focus just even every day is to focus on progress. You know, don't focus on, did we hit the goal, but did we make progress? Did we put some effort in, did we move forward a little bit further than we were yesterday or did we actually have to change direction because that's what the circumstances dictated. So again, I think it's just noticing day to day, how you can, you know, contribute and make a difference. And you know, that you have put effort in and all of those sorts of things and recognize yourself for it and your team and you know, all those sorts of things. But I think that's the in the moment stuff is so powerful to support yourself and your mindset.  Stacey: (05:54) And then I think the other thing Adam, that's really important is, one of the things about resilience I think is not going, Hey, everything's sparkling and amazingly wonderful right now, but, having the ability to go, okay, it might not be great right now, but I do believe that I can do some things that are going to improve it over time. And so I think having that conversation with yourself as well, like, okay, it's not ideal right now, but what can I do to actually help it along a little bit in the future? And, that feeling of doing something, of taking just a little bit of power back in the moment, again, super important for your resilience and positive mindset.  Adam: (06:36) Yeah, it's almost like you're taking back that power from the down moment. It doesn't have to make it a high moment, but you're kind of bringing yourself out of the hole and you're able to kind of push through in that way. Is that what you're saying?  Stacey: (06:47) Yeah, absolutely. And so it's not about that. I'll just, you know, be a victim of circumstances and go, oh, well, there's nothing I can do. Actually, you know, I can make a choice, right? Then, you know how they say that in the moment is the choice and even choosing not to make a choice is a choice. So I can choose to be a victim of circumstances or, you know, situations, or I can say, okay, no, I'm gonna look at what can I do here? And I think that, as you said, it's very empowering even though it's not the perfect set of circumstances and that empowerment, that taking back a little bit of control is so important for people to feel like, you know, they are influencing what's going on around them. And that again yeah, adds to the resilience piece.  Adam: (07:32) Yeah. So we've been focusing a lot on like our leadership and creating that mindset, but leaders have teams and are there ways that, you know, we as leaders, if we're doing this work in ourselves, we'll notice in our teams, oh, wait, this person may be having trouble. This person's going up and down a lot. Are there some like maybe coaching concepts or ways that we can help our teams, you know, kind of start working through these same things we've been discussing?  Stacey: (07:56) Yean, absolutely. I mean, the thing that I really love there is that you said, you know, you can notice what's happening for other people. So that's the very first thing as a leader. Notice, observe, you know, check in with your people, all of those things, because that gives you the information and the insight to then be able to support them. So, absolutely that's the first thing, but from a coaching perspective, there's a couple of really simple things that you can do. You know, if you notice for example, that perhaps someone seems like they might be having a moment where they don't feel like they've got any power or, you know, they're in that what I would call below the line, you know, they're not feeling very resourceful. They're not feeling like they can actually make a difference at the moment, is to actually ask them a question to sort of just, jolt them a little bit, I guess, interrupt that thinking pattern.  Stacey: (08:47) And so ask them a reframing question. So if they say something like, oh, it's all too hard, then you would ask them a really simple question in the positive like, well, what would make it easier? You know, and it's not about solving the big problem. It's just about getting them out of that moment of, I can't do anything to I can do something or they might say I'm just so busy and overwhelmed. And then you would say, okay, what's one thing you can focus on. So rather than focusing on everything, what we are doing is we are actually passing back control to them because we're getting them to think of a solution. And again, that's that whole empowering and I can do something in the moment. And so, just that little technique as a leader can really change somebody's day, you know, by asking one question in that positive action-taking kind of way, does that make sense?  Adam: (09:38) It does make sense. It stops somebody in the midst of their down and helps them kind of get to that point of resilience and gives them the tools to get to that point of resilience.  Stacey: (09:47) Yeah, absolutely. And, not only that, if they, if they come up with an idea about, oh, I could do this instead, and then they do it well, there's achievement and progress and all of those things that you get on top. And so, you know, it's a simple thing, but it can make a really big difference.  Adam: (10:07) Yeah. It can make a really big difference. So as a leader, we have to be problem solvers and you were just talking about, that's one way of problem solving, but I read you say, we need to go from problem solving to value adding. What does that mean? Let's discuss that a little bit.  Stacey: (10:21) Yeah. Okay. So, this for me is, it's the difference between, you know, what I notice is even now after many years, too many years, probably, there are so many people who become leaders because they were really good at what they used to do. They were an expert, you know, whether it was an accountant or a salesperson or an IT - what do you call them - developer? And so they were really good at that. And so they, and someone had this bright idea let's make them a leader. And so they weren't necessarily given all those leadership skills. And so their leadership career progresses, but they still rely a lot on their expertise often. Although they do develop out their leadership toolkit. And so for me, the difference between problem solving and value adding as a leader is if you are just relying on your own expertise, then you tend to be the problem solver, right?  Stacey: (11:11) You want to find the way forward the solution and that means that you are really limiting the capacity of your team in a way to you rather than tapping into all of the people around you. And so, for me, the value adding is as a leader, you have to let go of being the expert. You have to let your people be the expert. And then your job is to tap into all, all of that amazing resource and, you know, knowledge in the people around you. And of course that's using a coaching approach. And so when you use a coaching approach, you ask the right questions to help your people solve problems, to come up with, you know, innovative solutions and, you know, tap into their ideas and that sort of thing. And so that, to me, that's the value add. So instead of having a capacity of one, I've now got a capacity of all my team. and so, you know, I can activate all of them. And so the whole is greater than the sum of the parts, because you get this amazing collaboration, innovation and everything, because your job is not to solve the problem. It's to bring all those people together, you know, to be able to come up with the way forward.  Adam: (12:22) So let's unpack that a little bit because that's, I think a really profound thing, because I think many, many leaders find themselves in a position of leadership because they were the expert. And so you mentioned, coaching, you know, coaching people to asking the right questions, to get them on board. There's also hiring people who are smarter than you, who are better experts than you, right? Are there other ways to kind of help encourage people to become those experts?  Stacey: (12:47) Yeah. I think that there's kind of a couple of components to it. So, you know, you hear, so there's the boss, who's the expert kind of, and that's can create limitation, but if we let go of being the expert, that's one aspect. But, the other thing is that we want our teams and our people in our teams to not only be good at what they do, but we want them to aspire and grow so that they can add, and that they can contribute in lots of different it ways because everyone has, you know, incredible capacity and resource and, that sort of thing, but they don't necessarily believe that they can or aspire to it or take accountability, you know, for it. And so coaching again, can support all of those things. You know, when we, when we coach our people, we are sort of expressing our belief that we know they can figure this out.  Stacey: (13:36) And again, that's a very powerful thing to do, as a leader to believe in your people and create the space for them to come up with a solution or an idea, or, you know, those sorts of things or to, actually trust in them. I'm gonna give you this, I'm gonna ask you some questions so you can figure out how you're going to do it. And then I'm just going to leave it in your care, to get that done. And that trust, I think it just creates this opportunity. People can really step into that go, you know, it feels good. You know, if your leader trusts you to do something, it, it can feel really good, but we've got a couple that with making sure that they do have enough knowledge and resources and all those sorts of things. And so for me, it's the balance between mentoring people, kind of sharing your wisdom with them so that they can tap into your expertise, but they learn it and then coaching them to apply, you know, that knowledge into whatever it is that they're trying to do. And you, as the, leader are not getting involved in because you are leading, you are not doing.  Adam: (14:36) There's a lot to think about there and can it also be accompanied with, you know, saying to them Hey, why don't you go take this course on X, Y, and Z to increase your knowledge. And then let's talk about it to help them broaden their knowledge outside of what you know, and maybe as like the leaders, the expert, but you want them to become an expert. So you want to help them expand. Is that a way to do it as well?  Stacey: (15:00) Look, absolutely. I think that, you know, gifting people knowledge and opportunity is such an incredible thing to do. And, also for fostering, you know, if they have an interest in something and, that sort of thing to grow, that this is about, you know, the collective knowledge and, that sort of thing. And, if you can expand that, you know, this is about creating possibility, right? And so as a leader, that's part of your job as well. We don't just plateau. It's, you know, we've got a world change. We always need to be growing capability, not just our own capability. In fact, we've got this big responsibility to grow the capability of everyone around us. So helping them get knowledge and then coaching them through the application of that knowledge. So it's not just, you know, we know people go and do courses and then six month months later, they can't remember anything because they didn't actually use the knowledge. So yes, go and do the learning, give them that amazing opportunity, but then coach them to apply the learning , so they retain it all and we all get great value out of it. Yeah, what an opportunity.  Adam: (16:05) Definitely. So you mentioned giving people the space and I think giving space comes with trust and accountability. How do you develop accountability? Especially in a team that may be lacking that accountability or you're trying to build that up, to apply all the things we've been talking about.  Stacey: (16:21) Yeah, I go back to my default position, which is coaching. So coaching is a really great way to help people step into that accountability space. And I do work with a lot of, not a lot, but you know, definitely there's still a theme where people say, gosh, I wish my people would step up a little bit more or, you know, I don't feel like they're taking enough initiative or those sorts of things. It's accountability basically. But if I tell you, I say, Hey Adam, I've got this thing I need you to do, and I need you to do it by this time in this way, you know, because that's my way. and you go, oh yeah, thanks very much, Stacey. I'm really looking forward to doing that. Whereas if I say, Hey Adam, we've got this thing that we need to do.  Stacey: (17:02) And I'd love to know how you would go about doing it. And what do you reckon is the best way? And what's the first thing you would do? What resources do you need to be successful? Then you are going to come up with these ideas and you know, and when you come across the idea that you think, yes, that's going to work and you say, Hey Stacey, this is the way I would do it. And I go, great. When would you like to star? But now the ownership has moved to you cuz you've made all the decisions and choices about what's gonna happen and how you gonna do it. And it's your great idea. And so instead of it being my great idea, now it's your great idea. You're much more likely to own it and be accountable for it.  Adam: (17:43) And I guess the onus goes back onto a leader to be able to let go of the fact that the way you do it may be completely different and you maybe want to be like jump out and say, no, no, no, no, no change this way. But that person has to grow in their own way and be able to fly in a sense. Right?  Stacey: (18:00) Yeah, look. Absolutely. And, of course there will be those moments when your member of your team comes up with this idea, you go, oh, oh dear that's--. But instead of going, oh no, that won't work. I would still say, use a coaching approach. So what makes you think this is the right way? What are the risks around this approach? You know, and asking them so that they think it through and they either overcome all of your doubts because they've actually thought it through and you know, it's a great idea. Or they come to realize actually, you know what, in order for this to work, I need to do something else as well. Or maybe no, it is too risky. In fact, now that I think about it, I need to go and do something else, but they're still owning it. They're still figuring it out. And you are being the coach encouraging, supporting, creating the space for them to think it through, but not taking it away from them. You're still letting them, you know, own it.  Adam: (18:57) Yeah. You're letting them own it. So as we kind of wrap up our conversation, I wanted to kind of circle back. You've been mentioning coaching a lot. What are like top three coaching tips that you can give folks as we kind of end this conversation just in light of everything we've been talking about.  Stacey: (19:12) Yeah. Great. The first one is, as a leader, you wanna ask lots of open questions and be prepared to listen to the answers. I think that's a really important one. You know, people know if you're listening. So, so great open questions, lots of listening. And I would say don't jump in too early to judge those answers. Those would be my top three.  Closing: (19:36) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you've heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact James Petrossi: https://www.linkedin.com/in/jamespetrossi/PTNL Website https://www.ptnl.com/"Know Your True Self" Podcast: https://podcasts.apple.com/us/podcast/know-your-true-self/id1575535864Know Your True Self: The Formula to Raise Human Consciousness Book https://www.amazon.com/Know-Your-True-Self-Consciousness/dp/1734669144/ref=sr_1_2?crid=V853BCIL5IQB&keywords=know+your+true+self&qid=1636492862&sprefix=kbnow+your+true+self%2Caps%2C260&sr=8-2FULL EPISODE TRANSCRIPTAdam: (00:05) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host Adam Larson, and I'm pleased to bring you episode 162 of our series with featured guest, James Petrossi. James is the founder of PTNL and a researcher on human connection. He joined my co-host Mitch to talk about individual perspective, wellbeing and employees feeling fulfilled. Burnout has been at the forefront of everyone's mind following the demands of global work environment. So James has set out to help leaders develop organizational consciousness and recreate wellness for individual purpose. Keep listening to hear more about these strategies as we head over to the conversation now.  Mitch: (00:54) So James, there's been a lot of talk about the workforce across all industries in recent times. So, you know, from your perspective, I'd like to kick things off today with asking you, why are so many employees feeling unfulfilled and why are they choosing to resign at this time?  James: (01:11) Yeah, we're definitely facing a really challenging time and one extremely unique to evolutionary history and one to really embrace, accept and learn from. And I think there's three main reasons that employees are feeling that unfulfillment right now. The first is really the inability to cope with change. We've been going through so many changes over the past couple years and living in a state of uncertainty, especially as it relates to our job. One when the pandemic first hits, we're in a state of survival, anything to keep our job, then we're adapting to technology, Zoom calls being out of the office, changing landscapes, having kids at home, then all of a sudden there's a bright light and it looks like we're going back to the office and we're preparing ourselves for that. But our children aren't necessarily prepared to go back to school. So we've been navigating change in so many different aspects of our life and our brains rely on habits and it's through habit formations and repetitive actions that neuron chains develop in our brain. And we start to do things unconsciously. If you remember the time when you did commute to work, when you were either going there or going home, you sort of got lost in the commute. You weren't thinking about how to navigate to the office or the routine about stopping to get your coffee. Those all become unconscious behaviors. So as we continue to splinter those neuron chains and try to develop new ones, it really makes us feel lonely, disconnected, searching to find peace. So that's been a really big challenge is just navigating change. Making people feel unfulfilled and just comfortable in how they're navigating life holistically. I think another one is especially with the millennial generation and all generations, but specifically millennials and the emerging centennials in the workplace. We were coming out of the experience economy, really at the pinnacle of the experience economy and inside the experience economy or concerts, activations, all of these Instagram moments that we can share with friends and all of a sudden we became so used to just experiencing so many things on a moment to moment basis. And now we're with ourselves, we're with our thoughts, we have to contend with our emotions and our unconscious mind is not going to like this. And it's gonna tell us, you deserve to have all these things like you deserve to have life the way it was. I think it was Helen Keller said something to the effect of like character can't be developed in peace and quiet. It's through suffering that the soul gets strengthened, that we learn, we grow and we develop. So, you know, we can't get back time. We can only embrace the present moment and helping employees connect with the present moment. And the reality we face on a moment to moment, day to day basis helps us cope with change, and also feel like there's no getting back what we had. We can't quit our job and earn time back. We can only address what's currently happening. And then some of the onus of why employees are feeling unfulfilled at work is really on the employers themselves. Clearly identifying the purpose that you're creating in people's life. Just because we might not feel like we're contributing to a higher purpose on a day to day basis because not all work is infused with meaning, but it's the small actions. The things that we learn from the trying relationships that we have, the way we connect with our teams, the problems that we solve, all of these small moments in the workplace help us connect to a higher purpose. And if an organization can share their purpose through their vision, their values and making sure they're showing their employees how we help serve humanity, cuz every business that's out there is serving humanity. Whether they're providing pleasure, whether they're providing food, whether they're providing connection, we're all in the business of serving humanity and employees need to know that and make sure that an organization is living up to some type of core values. I think definitely where that connection gets lost between employers and employees is core values are sort of on the placard somewhere in the office, but how do we now activate those core values? And those values bring virtue into people's lives and help them feel like they're connected to a purpose bigger than themselves. So that purpose is really about creating a unified shared experience that truly builds a culture around an organization. And one employees can really, you know, glam onto and enjoy.  Mitch: (06:05) So you touched on many things that I can personally relate to over the last year and a half. You know, this is now we're recording this end of calendar year 21. And a lot of the things that you mentioned are certainly relatable having kids around when you're trying to work on teams calls and even the idea of commuting again, I think it's interesting because I know at least I had a bit of a longer commute. It was almost an opportunity at the end of the day to kind of stop your mind from working and transition to home on your way. And you know, nowadays it's a bit of a challenge cuz there isn't really that time to break. You know, it's just one thing to the next you're living in it at all times. I'm sure that's just one of the many. So I'm curious: you mentioned a lot of reasons for unfulfillment, but I think, you know, employees certainly still have an opportunity to feel fulfilled, you know, and organizations have an opportunity to really hone in on those core values. And I think a lot of businesses, you know, if they didn't adapt right away, they certainly have by now. So what are some of the ongoing challenges even if they are fulfilled that you think employees might be facing and you know, do you have any, you know, recommendations for overcoming these challenges?  James: (07:21) Yeah, definitely. I think one of them is the loss of relationships in the workplace. You know, you brought up the commute and all the moments that were ritualized inside of their achieving peace of mind. Now let's go to the workplace and in the workplace, we all of these rich opportunistic moments to connect on a daily basis with a large group of individuals, even it's just a smile and a nod in the morning. Did you catch the game last night? The moments before a meeting when there's a little bit of levity and laughter, the moments after the meeting, when you can sort of huddle with individual of team members, congratulate them, talk about next steps. We had all of these micro moments and those micro moments have truly become lost. Even the larger moments, like a cup of coffee, having lunch together, something that can't be replicated through a zoom call. We're highly social creatures. We really rely on that entanglement of our energy to feel each other, to connect with each other, to relate with one another. So I think for employers right now, it's not about a Zoom happy hour. It's not about getting a bunch of people together on something they're already fatigued on and staring at a screen, but helping connect people again, learning about each other's lifestyle interests, their families, even sharing stories of things they've learned about during the pandemic, finding ways to connect on a truly emotional level. And if you think about the life cycle of a relationship, the first stage is initiating you talk about the weather and the sports. Then you're experimenting, likes interests, movies, sports teams then intensifying. This is when you start to get an exchange of values, then finally you become integrating and you're seeing a purpose. Each other brings to you on a personal level and a business level. And finally you enter the bonding stage and where retention happens for employees is when they bond with one another, because they like to stay because of the relationships they have. Right now, we're circumventing, initiating, experimenting, intensifying and bonding. And we're just task oriented. We're just focused on the meeting right in front of us, turned it off onto the next meeting. So those human connections are gonna be extremely important for the future of the workplace. And reinstilling, getting back to them and finding tools and mechanisms where we can connect people with one another again.  Mitch: (09:55) Now I'm sure there are plenty of reasons that these challenges, you know, have almost augmented, you know, aside from just the virtual limitations of relationship building, I think we talked about it briefly at the very start. There are other more or less habits that we have developed throughout this pandemic. And it seems like technology is in front of us 24/7, whether it's work or not. So from your experience and everything we're talking about here, as far as relationships go, what impact does technology and social media have on an individual's, you know, day to day, their overall mental health?  James: (10:37) Yeah, well first we have to express extreme gratitude for having the technology that we do, because imagine if this was to happen in the nineties, we wouldn't be able to connect with each other. We were still in the world of long distance telephone calls. So it's amazing that we can pick up a phone and see someone's face, but we've become so reliant on it that we are not necessarily using it as a tool, but we're choosing to use it as a reality and we're getting deeper and deeper into that reality. And when we use technology, when we use social media, it divides our consciousness, it takes us out of the present moment. We can be having discussions with somebody and at the same token, I'm looking at my screen and I'm seeing comments from another project I'm working on. I'm getting alerts on my phone. So our productivity starts to diminish because our consciousness is splintered in so many ways. There's been countless studies that multitasking is a myth done by Harvard University. And the list goes on of great institutions that have studied multitasking. Yet we still believe that we can accomplish all of this at once. So one thing that we just have to make sure is as we move into the future, that we use these as a tool, you know, prior to COVID, I was probably on in my business career one or two Zoom calls. And it was because we were meeting a new team from a recent acquisition or a global team for the first time. And we would never get the chance to actually see them in person. But all of our presentations were just done over the phone. We didn't have to stare at a grid of spaces feeling like I'm on Hollywood squares. You know, everyone's like face staring at you. I know that's an old reference to Hollywood squares, but it becomes really challenging for us to deal with that. Especially for those that are visual learners, auditory learners, or kinesthetic learners, it's putting us in overload. So as employers look into the future, it's really finding purpose in those tools. You know, are you expected to have Slack open while you're presenting? It's probably not a good idea. It's probably a good idea to let someone direct their consciousness to their presentation, not have a little messages about what they should or shouldn't be saying popping up, cuz that should be done in rehearsal. If you're meeting someone for the first time, it's great to see their face. We've just met. It's nice to put a face to the name, but in the future, is it required? Probably not. We can just have a conversation. Sometimes it's a lot easier just to be in our own head space and have our consciousness focused on the topic at hand, what we're communicating to each other. So we just have to use technology correctly and we need to learn from our experience in COVID of what's worked and what's not worked and not just become super reliant on it because we know it's splintering our consciousness and dividing our attention, which is that decrease in productivity.  Mitch: (13:30) Yeah, it's really interesting because besides the, you know, personal reliance on technology, I think a lot of businesses and, you know, individual teams are really stressing the different values that technology does offer even in the workplace. I know you mentioned Slack briefly and there are a ton of other applications, software tools that can be used. So, you know, I'll get your perspective if you wanna share it from the business perspective or the personal perspective, when does technology actually help us? You know, we talked, it could split our consciousness sometimes and maybe that takes away from work and it can hurt us. But you know, like I said, I think there are positive uses of it as well. So would you care to share anything on that side of the coin?  James: (14:10) Yeah, definitely. I think it's, when communicating at a distance connecting for the first time or having one to one conversations that really weren't face to face, we see this in 360 reviews, providing feedback, coaching mechanisms, those are extremely important. When it hurts us, is when it's used for everything possible, everything in the kitchen sink all at once, really focusing on what is this tool for? Think about technology as a toolbox, define the purpose and the role for each of those tools that you have in relation to your workforce needs extremely important. And I feel like the time it hurts us the most is when we rely on it to run our lives. And this is in work and in just life, you know, you don't need to enter what you just ate into an app to know if it was healthy. I mean, you know, it's healthy. You know, if you ate an ice cream, you're not gonna be able to have another unhealthy meal for dinner. We don't need to rely on technology to do things for us that we consciously already know those mechanisms give us dopamine triggers. All of those alerts give us rushes in our brain. So every time you get an alert, an email, a ding, it sending a reward signal in your brain, and that's why we're so addicted to social media. That's why we're so addicted to technology is because we're used to it running our lives. The fact that we pick up our phone on average a hundred times a day is a little bit alarming and that the majority of us are on social media three and a half hours a day is pretty alarming. It's those are very alarming statistics. That's more addictive than cigarettes. That's more time on social media than people spent smoking in the heyday. So it's something we're in denial about. It's something we have to be conscious of and it's something we really need to work hard and create discipline around on how we use these tools effectively and with purpose in order to feel good about ourselves and create more wellbeing in our lives and be able to appreciate the present moments that we're in, whether it's working with colleagues on a pitch or presentation or a new client, or whether we're just connecting with friends and family.  Mitch: (16:29) And, you know, I love the analogy you shared with the toolbox because that's what it is. You know, it's essentially, it's an asset, it's something of value, but it has an individual purpose more or less. There are very rarely tools that you can accomplish every job around the house or something like that with. So I think that's a great way to look at technology as well. We don't need our phone for every single thing that we do. We have to take a step back and look at the human elements of things, right? And I think that's, you know, excellent point and really, you know, paints a good picture for how these tools should be used. So we talked a little bit about how to kind of get around these challenges and we wanna limit the amount that we use technology for and such. I'm just curious if you have any other solutions and really any other thoughts that you would like to share as far as how can individuals find purpose? How can organizations better communicate these purposes? You know, kind of just the whole conversation we've had so far. Can you bring it together and share any last minute thoughts with us?  James: (17:33) Yeah, definitely. Organizationally, think of an organization of one connected consciousness. You have a hive of minds working together to achieve a vision all with a unique mission. And what makes them want to go on that mission is the values that you have. So holding all of that together should be your mantra, your belief system, where you're directing everyone's consciousness to the greater good, how you're serving humanity, what you're doing to make this world a better place. Because the organizations that don't do that in the future will become obsolete to those that do employees want to work for a company for more than a year and a half, two years, they don't wanna have a revolving door, especially the generation that's entering the workplace right now, all of the centennials, gen Z, but they need to learn not just where the consciousness of an organization is directed, but how to connect with the other minds within that organization. So whether you start instilling some tried and true methods, like personality tests, having people on the team learn about each other, their likes, their interests, their passions, connecting them. Unity is the key. It's not dividing your organization. It's unifying them. And unification is the beginning of diversity programming. You can't separate people. You have to unite them first and then celebrate their differences. What each group brings to the table. I think for organizations, one of the traps is often plugging the holes on culture and organizational wellness is somewhat of a new term, but it's become very reliant on something like a meditation app or an exercise class, class passes. And those only plug the holes of organizational consciousness and what you really need to focus as teaching people about themselves, how to navigate, change, how to feel good about yourself, how to accept other people, the thoughts that are generated from your mind, where are they coming from? We need to create programming within organizations that truly helps increase the mental health and self-awareness of an organization to make that united consciousness shine really bright and achieve the goals at hand. And then I think finally, you know, just making sure for people and employees that are working for companies, learn to self-regulate your tech use uncover areas that you seek to grow and develop. You have to set goals for yourself, share those self-improvement goals holistically, whether they're talent, development, goals, career goals, financial goals, physical goals, social goals with your boss and show how you're looking to grow, what you wanna achieve and take time truly to connect with yourself and create a vision for where you wanna be in the future. And the more you share that vision with others, the more you'll gain internal support and the more success you'll have growing within an organization rather than feeling like you're defeated, deflated and fighting an uphill battle just to find peace and joy at work and work is the place where we find purpose in life. That's what's so beautiful about work. We choose a passion that's right for us, those passions shift and evolve and change over time. But work is the place that we find purpose. So it's something truly to harness the potential of, and enjoy as we're on this journey of life.  Closing: (21:17) This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Omar Choucair: https://www.linkedin.com/in/omar-choucair-cpa-80264815/FULL EPISODE TRANSCRIPTMitch: (00:05) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host Mitch Roshong, and I'm pleased to introduce you to Omar Choucair. Omar is the CFO at Tritech a world class financial operations and insights company committed to transforming financial processes to best in class levels of efficiency and effectiveness. Omar is a senior level financial executive with broad experience in corporate finance, accounting, corporate governance, and FP&A management skills. Here, in episode 161 of our series, he talks about why and how corporate M&A operations are falling short and where he sees the trends going in the future. Keep listening as we head over to the conversation now.  Adam: (00:57) Omar, thanks so much for joining us today, and we're gonna jump right into things in Bain's global M&A 2021 report, they state that M&A is expected to spur 45% of revenue growth over the next three years. Up from 30% over the last three years, one of the first lines of the report says as the world locked down and masked up M&A endured, do you agree with their sentiment?  Omar: (01:23) Yes. Wholeheartedly. And, thanks for taking the time it's, you know, the last 18 months have been quite overwhelming in terms of, the things that have happened to, you know, public companies and private companies. And, you know, to the extent that, somebody would said back in, the February, March timeframe of 2020, what was about to happen? I think a lot of people wouldn't have believed it, but yes, it's, it's been astounding.  Adam: (01:50) Definitely. I think everybody's just their minds have blown what's happening. but what's great is that business seems to be booming or not really booming, but increasing, which I think is one of the things that with everything locking down, we're still moving forward, which is great.  Omar: (02:07) Yeah. It's if you go back and think about just how many companies have grappled with, employees working remotely and the technology and the processes and the procedures that all these companies had to deal with early on in the pandemic. And to think that whether it was, you know, strategics, large strategic public companies, private equity, venture capital that this M&A engine continued, and not only continued, but accelerated all the way through the end of 20. And then, continuing through the first, you know, 10 months of 2021 is absolutely stunning.  Adam: (02:48) So even with this positive outlook that we've been talking about, many corporate M&A operations seem to be falling short still, can we focus a little bit on why and how this continues to occur?  Omar: (03:01) Sure. I would say a couple of things. So first of all the large strategics, you know, they had the capital. So I don't think there was an issue with respect to capital. I think they had cash on the balance sheet. They had plentiful access to, you know, to public debt, private debt, et cetera. I think what could have happened was that these large strategics had a process and a control procedure about how to do M&A, it was like very programmatic. And I think what could have happened was when everybody went and started working from home and the remote side, that a lot of that programmatic process, it wasn't hardened for people working from home. And that's my personal belief. And I think additionally, to the extent that those companies, those large strategics had, built in technology, whether it was on the FP&A side on the financial close side, just in terms of, you know, R&D, those companies that were really hardened and connected on the IT side, I think they did extremely well versus their counterparts that maybe had not invested in technology. And they saw this like, gap between what they thought they could do and what they actually could do. And just the, the astounding pace at what's, the M&A, you know, market continued. It really, it probably put a lot of pressure and squeeze on some of those companies.  Adam: (04:28) Do you think that there was a bit of a change management gap as well for those companies that were not kind of up to par?  Omar: (04:36) I think the, the change management is always difficult. And if you kind of, you know, zoom out a little bit in terms of change management and just the integration, I know the first hundred days are just, it's almost like it's the, it's all the due diligence, you know, up until the time that there's an M&A deal that gets signed. And there's a whole process around that. And I think we can talk about that in a little bit, but in terms of the first hundred days after, those first hundred days after are critical in terms of culture, in terms of what did companies buy, did they buy technology? Did they buy, did they make customer list? Like, what is it, what was the strategic asset that they bought? And I think that's really important.  Adam: (05:16) Do you think that first hundred days is even harder when you have a remote workforce?  Omar: (05:21) I think the first hundred days are significantly harder when you have a remote workforce. And the reason is because there's two cultures that have to get fused. It's the it's, you have to prep the buyer's culture, right. In terms of now we have this additional responsibility. And a lot of times, you know, the C level and the board, they're all super excited about, you know, doing the M&A, but then it's the mid-level management. Everybody else go, wait a minute, I've got all this additional work I have to do. Right. So, sometimes there's a gap between the board and senior management and what, you know, the people that actually are doing some of the work. So I think there's that. And then I think also to the extent that, you know, the systems and the process and technology are not really running at optimum level, when you bring on an additional, you know, set of revenue streams, and HR and people and technology, it can be a very stressful period. And then if all those people are working at home and they don't have that culture. Yeah. It's a lot of work. And I think, you know, for the CEO, CFO, et cetera, there's a lot of gut checks that have to be made all along, all along the way.  Adam: (06:36) All right. So we've been talking a little bit about the, how and the why and how it affects the people, but can we focus now just what's some steps that we can take to overcome these challenges and the things we've been discussing.  Omar: (06:49) Right. I would say it's really in two pieces. So the large public companies, you know, they have obviously the large public companies versus, you know, private, you know, PE-backed companies, if you will, it's a different ballgame, right? So those public companies, they have, you know, legal obligations to have programmatic controls and processes, et cetera in place. So, so any company that's a public company. And then we can talk about the SPAC and little bit, they they've had to jump into that public company real quickly, but to the extent that they have controls and procedures, it's a little bit easier for them to solve the gaps because they have a roadmap and they have certain monthly and quarterly controls that have to get done. And they're very well documented. They're very well tested. They have third parties that are testing them all the time. So the gap is a little bit easier for public companies because I think they know what to do. I think the real question then is for the management is how do they get folks that are working at home to continue to meet those controls and procedures? Cuz that is a challenge with people working from home. That challenge is alleviated. If they have good technology and they have good systems, you know, and back office tools, cetera. On the private side, you know, whether it's to PE companies, et cetera, those controls and procedures probably aren't as robust as they would be at public companies. And I think, the private companies, they probably have a different skill set in terms of their, you know, their management team. And they probably pivot a lot quicker. They probably more nimble, more flexible. They can do things, you know, quicker and sooner than what, you know, public companies can just because of the nature of their business. So cause of that, I think they can move. They can move a lot faster.  Adam: (08:45) So do you think size matters then when it comes to this process?  Omar: (08:50) It could, I think there are some large, you know, multi-billion dollar companies that can move very quickly because they have the people that they need to move. Right? The valuations now are so competitive that if companies do not move quickly, they get eliminated very fast. So, so I think a lot of larger companies have, you know, very robust M&A that they can move pretty quickly. Other words, they have a process down to move quickly. They can get approvals, they can diligence quickly. They can get approvals quickly, et cetera. I just think there are certain ones that do a lot better job than others, right? On the private equity side, I think they can move extremely quickly, very fast. They have a lot of resources inside, you know, the PE companies, a lot of the companies have very experienced, M&A, you know, teams that can go through things quickly. They have accountants and attorneys and consultants on speed dial. That can jump in, even though it's getting harder and harder to capture those folks, cuz they're in such high demand, you can still find people that can, when you say jump, they say how high. And they can move in quickly. So, they can be pretty nimble if they need to be. And then, you know, we haven't talked about access to capital, but you know, there's a lot of cash on the sidelines, a lot of access to public and private debt.  Adam: (10:23) Do you think that's why the SPAC market has been like going through the roof too? I was reading the other day, how many have happened? And just in 2021 alone, it's like in the hundreds and you're like, what! I think that seems to be the way people are way companies are going. Why do you think that is?  Omar: (10:39) It is a completely, well, it's not a new vehicle. There used to be blank check companies that were just called blank check companies years and years ago done this for a long time. And they were always around, but I think what's happened is that there's just so many new opportunities. Just take, for example, you know the EV car companies, you know, Lucid Motors came out and I mean, there's so many different opportunities now that I think they took advantage of the SPACs. And I think the SPACs can be very lucrative for the owners of the SPACs. And so once there's a investment vehicle that is, that's interesting. A lot of people, you know, the herd mentality, they jump in and the SPACs were really popular at the end of last year and they continued to be popular. But I think in the last two months, it slowed a little bit just because the SEC came in and has, you know, has taken notice in terms of the SPACs. And, you know, they're putting a lot more, you know, public company disclosure around certain metrics inside those companies. And, you know, the values were really, really strong through the summer. And I think over the last couple of months, they they've tailed off a little bit. I think maybe some of the views may be that some of the companies that went public through a SPAC might have been a little bit early in terms of really being, game time ready to be a public company. That's just from what I've read and seen. So, I think that kind of remains to be seen, but there are lots of opportunities on this back side, just given the vehicle and given the, you know, the people these are very sophisticated investors that are in SPACs.  Adam: (12:23) Definitely. And it's almost like it's overcoming what the normal IPO used to be. Right. And the SPAC is like the new fan gold, like low gold that people are like, Hey, let's jump to that one in a sense. Right?  Speaker 3: (12:37) Well, I think they did that. Cause there was so much in terms of, excitement early and early wins. And when people saw the early wins, it just brought more and more people and you had movie stars and you just had a lot of different types of people that came into the SPACs and, and that created this massive windfall for accountants and attorneys and people it's just, you know, just massive amounts of work that went through there.  Adam: (13:06) And again, with all of that going back to earlier in our conversation, just thinking about how that affects, you know, management and then middle management, and then the other workers, as they're trying to get all these things ready and prepare this, it's creating a lot of work, which again, affects so many people, you know, being spread out through so many different places.  Omar: (13:28) Yeah. The entire M&A ecosystem, you know, impacts everybody across the spectrum, you know, impacts, you know, all your employees, not only just the C-suite and the board, but you know, everybody down because at the end of the day, a lot of times when you think about an M&A, you know, being a CFO from the finance side, you know, there's culture, and did you buy assets? Did you buy technology? Did you buy customer lists? But you know, most everybody says, well, let's grab the checkbook early. Right. So grab the checkbook early, and then you can avoid a lot of, you know, concern and confusion down the road, but there's grab the checkbook early, but then it's also provide the autonomy to the new, you know, to the new target. And then, you know, in my experience, it's always been good to have best of breed. So it's always good, you know, to line up, you know, sometimes you could have two of the same, you have two sales leaders, two finance leaders, two engineering leaders. And a lot of times it's good just to take the best of breed. And, you know, we haven't talked about synergies, but even though the synergies may be talked about early and the banks may have baked in the synergies, almost everybody looks at it down the road and says, yeah, there needs to be some synergies that come through. And I think that's when the hard part comes in terms of, you know, separating, you know, best of breed and getting the right people in the right spot because the new company, they would like to see some of their folks in leadership positions, in the combined company.  Adam: (15:07) Yeah, to make them feel like they're not being completely pushed out.  Omar: (15:11) Correct. And that can be important for a lot of different reasons. Not to mention culture is like one of 'em for sure.  Adam: (15:20) Yeah. Well, cuz you're mixing two cultures together, you know, especially if it's two, like, company, you're integrating another culture into one company and then it's helpful for people who are coming on to say, oh, I know that person or I recognize that person to kind of make, it's almost a comfort in a sense as you're adapting.  Omar: (15:41) Yeah. I mean the flip side is we haven't talked about just how difficult it is to retain talent and retain people. But a lot of times what could happen is if you're the target company and you're about to get sold most, it's just human nature. Most people think I'm about to get fired. And so that's really difficult on both companies cuz somehow you need to reach out and say, you know, don't leave. There's great opportunity for you, you know, in the combined company. And most of the time there is, but it's hard to tell people that when, you know, they don't have any information, the communication could be spotty and they have three job offers in their email to go, you know, to go make more money somewhere else. So that's the difficult part of retaining talent.  Adam: (16:30) Yeah. I was just going in that direction as I was thinking through what we've been talking about, you know, how do you retain the top talent in the midst of a big acquisition?  Omar: (16:41) It's very difficult and it's multiple factors. And I think probably to me, the most important part is if the target sees their leadership being woven directly into the combined company, in my mind, that's probably the most important piece, is that they can see that their CFO, their CEO, their sales people, that the acquirer is making a concerted effort to bring and blend in everybody. That's really important. I think the other part obviously is, you know, comp and everybody wants to be, you know, paid fairly. And, some companies have the ability to do that, you know, with stock and in different packages. So I think that's important. And I think also, what type of work are they gonna be doing?  Adam: (17:36) Yeah, for sure.  Omar: (17:39) And, you know, that kind of gets into a little different animal is just the technology. And to the extent that these companies, as they come together have they're on the leading edge of technology. I think employees today, they wanna work for companies that have invested in technology and make their job, you know, easier, you know, just on the CFO side, in our business. And we've done a lot to help companies eliminate manual processes and eliminate, you know, just procedures that are just very routine and convert them and put 'em in the cloud and just make people more streamlined and people can do more value added projects during the day, instead of doing rote recurring, you know, boring, you know, functions every day. And I think that's important for people cuz you know, as we move, you know, there's so much technology available, people would like to be with a company that has invested in the future as opposed to living in the past.  Adam: (18:38) So looking at the future, I know that you watch M&A very closely, where do you see the M&A trends going as we look maybe for 12, 24 months?  Omar: (18:47) Yeah, I think it's hard to see something that gets in the way of just continued M&A growth. And I think there's a couple things that people are hoping continue to happen. And there's a few things that, you know, may happen that could derail it. So one is just continued access to capital. So continued access to capital is important. The interest right rates associated with that capital continues to be at historic lows, even though it might have ticked up a little bit. I mean, it's, it's still really, really nice to have massive access to capital at historically low interest rates. And that in and of itself will drive a lot of, M&A. And I think if you just looked at the PE companies and the venture companies and look at the amount of money that they've raised with their, you know, investors, it's massive, right. And those funds have to be put to use, I think all the strategics that are out there, if you think about what happened over the last year, a lot of these larger companies, they cut back on travel, on sales and market. They cut back on a lot of things. So as a result, guess what all this cash is now sitting on the balance sheet. So you have tremendous amount of cash inside the strategics, right? There's a lot of money sitting with the VCs and the private equity. So the combination of all the cash and access to low capital is a nice recipe for continued like M&A work. And so that'll continue. And obviously there's lots of the valuations are, are very nice for, you know, for people that are trying to exit. So then the question would be what could get in the way of that. I don't see really anything crazy happening next 12, maybe 18 months, but I think the inflation kind of hurts people a little bit. And, you know, when, when people are paying so much more for gas and food, et cetera, I think that does kind of dim a little bit in terms of, you know, do we really feel comfortable making these big bets with inflation? I think there's continued concern about legislation in terms of tax, you know, tax regulations and tax changes, et cetera. It's maybe too early to tell, but that could have a dimming impact as well in terms of, you know, tax rates, et cetera. The supply chain obviously is tough and we're in the software business. So, you know, thankfully we're a little immune from that, but to have know 300 tankers that are sitting outside of Long Beach, I'm sure that that does bother people in terms of people that are dependent on, you know, manufacturing and, you know, the chip shortage. There's a lot of macroeconomic decisions that people go in, but my personal thought is 12 to 18 months. It should continue to be strong.  Closing: (21:50) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Katie Thomas: https://www.linkedin.com/in/katiethomascpa/ Leaders Online: www.leaders-online.com4 C Process: www.leaders-online.com/4cprocessFULL EPISODE TRANSCRIPTAdam: (00:04)Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host Adam Larson, and I'm here to preview episode 160 of our series. Katie Thomas, owner of Leaders Online, rejoins Count Me In today to talk about finding, connecting, and developing relationships with key stakeholders. Katie does a lot of marketing and social media for executives and helps them increase their presence in the industry. In her conversation with Mitch, she talks about the power of technology and social media as it pertains to increasing influence and nurturing lasting relationships. Keep listening as we head over to the main part of the episode now.Mitch: (00:51)So Katie, the first time we spoke, you talked about how technology really changed the landscape of the accounting industry. We talked about analytics, growing your business, becoming more profitable, things along those lines. But I understand a lot has changed since we spoke and that was, you know, February of 2020. So what I wanna kind of get into and, and start off is if you can kind of explain, you know, what you've seen over the last year and a half, and what else has changed across the accounting industry?Katie: (01:20)Yeah, so man, since February of 2020, I feel like technology has had to be embraced more than ever. I mean, there were a lot of firms using technology, but then there were a lot not, and I think it was this thing where the firms who weren't fully embracing technology, they knew about it, but it was kind of scary be because what you've done before, and if it was working, it's like why fix what's not broken, but then the pandemic hit and there was something that was broken. You could no longer have face-to-face meetings. You could no longer operate as you did before. And so it really forced the accounting firms and their clients into digital relationships, even if they were traditionally local relationships, like come in, meet face-to-face, it was, Hey, we've gotta find different ways to communicate with our clients. A lot of people jumped on Zoom and then managing the staff and the firm members that also had to change. So if you didn't previously use project management tool or document sharing, all of that had to be quickly learned and leveraged and utilized. So I think that the outcome of all of this is really cool because firms had to become confident in using this and they realize that they don't necessarily need as big of an office or they don't need to meet in person as much. And they can still maintain those relationships, whether it's with clients or with staff. I know a lot of firms I work with. They're like, okay, we miss getting together in person and we're still gonna do that. But you know, maybe it's, you don't have to be in the office eight to five every single day. There's some flexibility.Mitch: (03:02)Yeah. I think that's a great point. And you know, our focus for today's conversation really is on these relationships, right? Whether it's clients or key stakeholders inside or outside of the business, we'll get into, you know, how we connect with them and such, but to kind of connect the dots where we were and where we are. Can you first talk a little bit about maybe some of the things that technology can influence when it comes to stakeholder relationships and where we're going with our conversation today?Katie: (03:29)Yeah. So people really connect in two ways. There's gonna be emotional connections. So like that's just gonna be like conversations and how you feel out someone. maybe you have similar views, goals, thoughts, and people really connect this way through talking and through stories. So there is some technology that can help with this, even like Zoom or Loom or apps that just connect us. But really I see technology on the other side of how we connect the logical way that we connect and with technology, you can really see into the data and create a story through this to then help you connect and talk about why you're doing certain things, the outcome of why of what's happening. The data really gives us the facts and the technology and able to us to access the data to then create stories around this data. So technology is a key piece in communicating, but I really see it supporting a lot of that logical side of how humans can connect.Mitch: (04:28)That's really well said. And we did briefly talk about analytics last time and you know, the data and everything you just mentioned. It's, it's a great point. So to take it a step further, you mentioned Zoom and some other, you know, apps, as far as technology goes, whether they're specific tools or more broadly social media, just in general, what kind of resources can our listeners use to better find, connect and develop relationships with key stakeholders? You know, what can they go out and access in order to improve these relationships for the long term?Katie: (05:01)Yeah, so I definitely think Zoom's a really popular one. Another one I mentioned was Loom. So that's like a screen recording tool, which is super helpful if you're trying to explain something and you're not, maybe you're gonna deliver this through an email. You can walk someone through like financials or maybe a process or a report. And you can actually show yourself talking about it as well as share your screen. I think this one's great client portals are great tools. So client portals can be used to share documents, securely, communicate through them. I think that's a great one. and then social media platforms are also awesome because you can create content for a wide variety of people. You can have conversations in the direct message. You know, there's a lot of platforms out there. Maybe it's even like your project management tool where you're communicating, but really it's just identifying maybe where there's a gap in communication. And since there is a tool for about everything, if you Google that, you'll probably find someone that's found a solution or created a solution that you can utilize.Mitch: (06:02)Yeah. Google is a, it's a great tool in itself and very, you know, very helpful on a daily basis. But as I said earlier, you know, there's obviously a lot more to our conversation than technology. There's a lot more to the profession than just technology. So I do wanna take this a step further and really make sure we cover, you know, our listener side of things, the management accounting side, a little bit more of the accounting finance profession. As far as connecting with individuals, I know something that you really focus on with the marketing side of your business is enabling individuals to increase their influence. So I'd like to hear your thought on, you know, whether it's tools or strategies, what can individuals do to increase their influence and really make a greater impact on the business.Katie: (06:47)So I think one of the number one things that individuals can do to create a greater influence on the organization and individuals as a whole it's to really align their why with the company's why and why this is so important is if you can come to work every single day and you can see like your why, which if you haven't read Simon Sinek's book all about find your why I highly recommend it to everyone, but based it's your personal why is different from someone else's. And if you can figure out what yours is and how it can fit into an organization, then you can come to work every single day with a purpose and a driving force. And whenever you do that, then you can take that and you can be passionate about what you do and you can help others do the same, because if you can help others through you being passionate about it, find meaning in their work, because otherwise it's just a job, right? If you can help others do that, then they're gonna be committed to the ultimate goal of the organization. They're gonna be excited about what they do. They're gonna feel positive and enthusiastic, even when times get tough because they they're connected to something greater. I think that's so important. So as leaders, whether you're the owner of a company or you just started a company, you can still be a leader and you can still create influence, but it starts with leading by example and being passionate and connected to what you do and why you do it.Mitch: (08:20)Yeah. I think if there's something that the last 18 plus months have taught, a lot of people it's, you know, really gotta take care of yourself first and foremost and, and understanding your why you're passionate in making sure that everything you're doing is, you know, keeping you physically mentally healthy along the way. Otherwise the job just takes away from that. I think that's a big part of it. So, I certainly know where you're coming from here. And, you know, I know I mentioned the marketing, the social media side of things, and you help executives really increase their presence within the industry. I'm just wondering if you have any strategies, you know, anything that our listeners can take away from this conversation where even if they're just contributors to a team or something like that, they can really stand out. You know, what is it about understanding your passion and your why that enables anybody to stand out in the organization and make a difference?Katie: (09:11)Yeah. So this is a process that anyone can apply. And if someone is listening to this and wants to know more about it, I have a whole guide that they can download. That'll go into more depth, but it's called the 4C process. And if you go to leaders/online.com/4C, anyone can get that guide. but basically it's built around, you guessed it, the 4 C's. And, we can talk a little bit about those now, but basically you need to choose a platform to be on. And when you're trying to choose a platform to be on, when it comes to social media, think about where do your stakeholders hang out, or maybe this is where do your ideal staff hang out, whatever your goal is, think about where those people are hanging out and then about what platform plays to your strengths. So, for example, if you're someone who you don't like creating videos, then maybe don't use YouTube. Even if your stakeholders are on there or your ideal clients, or your ideal staff, like pick a platform where you can create content that you feel comfortable. So you've gotta choose a platform and just pick one. And then, you've gotta figure out how to connect with the people that you really want to connect with. So LinkedIn's really popular for professionals and people in our industry because it's a professional platform. And so with LinkedIn, you can go find people by searching by their name, their title, their location, their experience, and you know how you find these people and you connect with them. It's gonna be a little different for each platform. So Facebook, it might be, you find them in groups, Instagram, you may find them by hashtags, but you've gotta find them. You've gotta connect with them. and then the third thing you've got to do, so you've chosen your platform. You've connected with them. Then you've gotta talk to them because if you went to a brand new cocktail party, and this is a new group, and you didn't say anything, you just stood in the corner, what would happen? Probably nothing. So you've actually go out to go out and talk to these people, whether you know them, or you've never met them, start a conversation with them, ask them what they're seeing in the industry. Ask. them what they're working on. What they're excited about. Just ask them a question is whenever you ask a question, you open up the doors for a conversation and the fourth step in this is gonna be to create. So we picked our platform. We chose our platform. We connected with our ideal people that we're looking to build relationships with. We conversed with them, and they'll finally, we're gonna create and create is something that a lot of people, people can get hung up on. And it's something that should come last. So if you aren't actively going out and building your community and having conversations with these people, if you create content, then not as many people are gonna see it. So content's like the gas to your fire. It comes last. And when you create a lot of people, be like, I'm not creative, everyone's creative because everyone has a story they can share. Everyone gets emails with questions on a regular basis. Everyone's doing work. You can talk about what you're doing, what's going on in your company. What's going on in the industry, maybe how you got into the position you're at today. Maybe some of the challenges you're facing, there's so much content that can be created. And that's something that is so fun to work with professionals on to help them share their story, share. What's exciting them, what they're changing, maybe in the industry. This is where we love to help out. But, it definitely only comes last in a lot of people. They can try to do it first and then they don't see the results they're looking for.Mitch: (12:40)So I'm actually gonna rewind for a second, because as you're explaining all of this, you know, your passion for what you're doing it's very noticeable. And I can tell that, you know, you enjoy what you do. So I kind of wanna go back to the, the beginning of our conversation here and kind of ask you, you know, what's your, why, I know that you're, like I said, so passionate about this. So I'm just curious, you know, why is that? What have you been able to figure out when it comes to helping others increase their influence and increase their, their presence? What do you enjoy most about doing this?Katie: (13:12)My why is to help people be more confident in what they can do so that they can create a bigger impact. And that just excites me because I think as a profession, we do so much great work and we create a lot of changes, whether it's like helping a business succeed, that's external to us. Maybe it's our internal company, maybe it's teaching staff, like we do a lot. And a lot of us aren't confident in what we do. We aren't confident to talk about it or to share our knowledge. we like to just kind of do the work and we do it well, and we don't talk about it. So we aren't creating as big of impact as we could. We aren't having the influence that we could. and a lot of us aren't making the money that we deserve. And so my why is helping people become confident about it. And it's so cool to see that transformation that someone can have when we work with them.Mitch: (14:10)That that's awesome and I'm sure many of your clients greatly appreciate that. Like I said, it definitely comes across, even in this conversation here, but to wrap things up, you know, like I said, we spoke a year and a half ago, and you could argue that a lot has changed, but you could also say that nothing has really changed because as we said in the beginning, technology continues to evolve. Analytics is so important. Relationship buildings, you know, upscaling, rescaling everything across the profession. When we started, you know, before we started recording here, you mentioned your business has changed a little bit since we last spoke as well. So things continue to evolve is my point. And I'm just curious to get your thoughts. We wrapped up the conversation the same way the last time. How do you envision the accounting profession moving along into the future? You know, what else do you see coming up? Whether it's because of the result of the pandemic or just technology impacting the profession, how do you see things progressing for all of our listeners coming up?Katie: (15:11)There's a lot of ways that this question could be answered. It's definitely the accountants are moving into more advisory roles. As technology becomes more advanced and can do some of those lower level tasks. I think it's a lot more smaller firms are now coming into play because technology makes it easy to start up your own firm. And then it's this whole idea of digital relationships. someone doesn't need to be located in your same city or your same state to work with you, whether that's a client or a staff member, whether or not these tools and resources were available to people pre pandemic that doesn't really change anything other than the fact that now more and more people are seeing the opportunity and maybe even had the time to say, okay, during the pandemic, they got to reimagine what's possible for their self and their business or their current role. So they are changing. And I think that it's ultimately more opportunity for everyone.Closing: (16:19)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit website at www.imanet.org.

Contact Jamie Gregory: https://www.linkedin.com/in/jamie-gregory-7030455/FULL EPISODE TRANSCRIPTMitch: (00:05)Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host Mitch Roshong, and you are now listening to episode 159 of our series. Today's featured guest speaker is chief financial officer at Synovus, Jamie Gregory. In this episode, Jamie talks about strategic initiatives and leading through change during a tough economic environment. As an example, he is a part of Synovus Forward. Synovus Forward is a revenue generating and expense saving initiative that began in late 2019 with the goal of achieving top quartile performance and an annual 175 million pre-tax run rate benefit by 2022, as well as best in class experience for clients, employees, and shareholders. Keep listening to hear more about this initiative, the role of innovation and adapting to change.Adam: (01:05)Jamie, thanks so much for coming on the podcast today. We're so glad we could have you on, and we all know that the last 18 months have been really hard for many, many businesses. Some shut down other ones, you know, have struggled going forward and companies have to be strategic. And something I was reading about is Synovus Forward, an initiative that your company, has put forth recently. And can you tell us a little bit more about that?Jamie: (01:29)Yeah, absolutely. Adam first, thanks for having me today. I look forward to this discussion. Synovus Forward has been transformational for us. It all started back in 2019 when we looked at our long term plan our multiyear forecast and thought about how does that relate to our objectives to be a top quartile performer. And so we looked at that, we looked at where we expected the industry to be and our peers to be. And we realized we had a little bit of a gap there. And so we took a step back and looked internally and we realized that we had opportunities to be better. We had ways we could improve, we could, improve our delivery, to our customers through enhanced processes. We could look and then ensure that we have the right physical infrastructure. We realized that we had opportunities to improve, some of our third party, including, the partners we choose to help us deliver Synovus to our clients. But then, you know, as we progressed, the world changed on us. We started Synovus Forward in late 2019, and the first quarter of 2020, the whole world looked different. And so we had to reassess. And so it changed our outlook of what was required, to be top quartile. And we pivoted from there, but Synovus Forward started off as an initiative. It became a bigger initiative and now it's becoming just a cultural mindset of continuous improvement.Adam: (02:58)So I think that's a great example of, you know, seeing the economic environment, seeing the environment around you and adapting, you know, not just, taking, taking the initiative as you first saw it, but adapting as you went along, are there some major lessons that you can share since implementing.Jamie: (03:14)Well, you hit the nail on the head. The first thing is being willing to adapt. So you have to always be stepping back, looking at, you know, the impact in your vision and how does, what your outlook for the company, what that outlook is, how does that relate to your objectives? And so we're really clear on what our objectives are. And so as the outlook evolves, our tactics to achieve our objectives have to evolve. And so that was a piece of it. And that's what we were assessing in early 2020. But other lessons we learned is that there are win-win scenarios. If you're willing to really dig in and look for them, there are ways that everybody can be a winner. When you think about our key stakeholders, we have, you know, our shareholders, our team members, and our clients, and all of these can benefit through improvement. And so, you know, that was a big lesson that we've learned. And the last thing I would say is you do have to be persistent. Change can be tough, but you have to be there to support your team members and monitor the progress. And to see the initiatives through, to the finish lineAdam: (04:21)Change is definitely tough, especially when you're looking to kind of be agile and move and adapt with the environment and financial and accounting industries. They're highly regulated, whether it's it's banking or taxing, all that stuff, everything's highly regulated. How do you continue to be agile in those types of environments?Jamie: (04:42)Yeah. First and foremost, you have to have a strong control environment, just to ensure that as you evolve, you're evolving from a place of strength, you know, but agile is, you know, bringing that up is a great point. When you break larger initiatives into smaller components, it can actually help enhance your control environment because you're able to test as you go along rather than wait to the end of a large initiative, to look and ensure that you're maintaining, sufficient control environment. So to me, agile is an important framework, as you think about, you know, maintaining and potentially enhancing your control environment as you go through these initiatives.Adam: (05:26)So control environment, internal controls, how important having internal controls been, especially as most of the workforce went to, working from home. And then now back in the office or hybrid environments.Jamie: (05:39)It's absolutely critical. And you look at ways to enhance the internal controls, both through your processes, but also through automation. and we believe that, you know, one of the major benefits, of automation is enhancing the control environment, reducing operational risk and trying to take human error out of the equation.Adam: (06:02)That's very important. So taking human error out a lot of times involves things like innovation. We've talked about agile, but now let's talk about being innovative. Change is not far behind and how can leaders, how can leaders guide their teams effectively through an innovative process?Jamie: (06:19)Well, first the first priority is ensuring you began with the end in mind that you had a long term vision, no matter what. So that way, no matter what short term changes or what tactical changes happen during the course of an initiative or a project that everybody's aligned on long term vision, so that, you know, your tactics may change and your strategies may change and the project may evolve, but it's all driving you to the same endpoint and that's what's critical. So that the team and anybody involved internally, externally, they can see that the progress towards the end, it remains the same, even if, how you're getting there may have changed from when you began the project.Adam: (07:02)Yeah. So do you have any examples maybe, of a time where you've led a team through that innovative change that you can share with us?Jamie: (07:11)Sure, sure. You know, I want to kind of go back to the Synovus Forward as you look at how that evolved. And so I mentioned that when we started this, we had a hundred million objective. This was to get us to top quartile and then the world changed. And the world changed, you know, when you have, interest rates declining, growth slowing uncertainty on capital liquidity, our outlook evolved with that. Now one thing that's interesting about our income statement is, that we are heavier on interest income, as a percentage of total revenue, than some of our peers. And so when you have that declining rate environment, it can impact us, a little bit more than others. And so when you look at what it takes to achieve top quartile performance, it changed. And that's what, resulted in us elevating our objective from $100,000,000 to $175,000,000. And so we pivoted then, but the team was immediately in line. The team was immediately understanding of how it evolved and how our goals increased because they knew what the long term objective was. They knew that we were all, you know, striving for the top quartile performance. And so that allowed the team to lock arms on the new objective fairly easily. And so that, that type of mentality of having that longer term vision really allows for easier discussions as your strategy evolves when you're going through, change like we've experienced in the last 18 months.Adam: (08:48)But you not only had it, you shared it with the whole team so that everybody could be on the same page so that when the change did come, the whole ship moved together as opposed to moving apart in a sense.Jamie: (09:02)That's right. That's right. And when you, when you have, increased objectives, increased targets for improvement, obviously these initiatives, can be challenging and they're difficult. there's a lot that goes into them, there's a lot of, you know, give and take between internal and external partners. And so just having that long term vision, having clarity around where we are going, just allows everybody to be understanding of any potential sacrifices they may be making in that process.Adam: (09:35)Definitely. So as we look into the crystal ball toward the future, what should accounting and finance professionals be focused on as we navigate to this new normal within the industry?Jamie: (09:47)Yeah. Yeah. Great, great question. I mean, for us, you know, we, we had already been moving towards an accounting and finance model, more focused on service analytics and business insights, you know, so we can provide real time decision making capabilities, but the pandemic really put that aspiration into overdrive. It wasn't just enough to provide a one single forecast scenario. We had to adapt quickly to the volatile environment and be agile enough to prepare multiple forecast scenarios while, you know, we're still in the process of enhancing, our technology to provide real time information. But the more, you know, traditional accounting and financials, are becoming more automated, and these responsibilities are shifting towards building enterprise value, pivoting from information delivery to analysis and performance improvement. And so that those are trends that we're really excited about. We are also, you know, spending a lot of time looking at how self-service centers could develop for internal business leaders so that they can gather their own data for any of their ad hoc requests. You know, really allowing for a standardization of reports provided by, you know, the finance organization so that we can maintain efficiency, consistency, and information. And then also just increase the availability to provide value, add a strategic analysis and advice because the team is not overwhelmed with just providing information. So those are the, you know, as we evolve, those are what we are focused on, but we also see opportunities for us to get better. You know, we are continually trying to improve our own education, our own view on the outlook of, of the finance partnerships internally, and to expand our kind of our talent pool. We believe we have real opportunities to grow in our impact on this, on Synovus as a whole, to help us get better, help us achieve this, you know, top quartile performance above peer growth, all of these strategic initiatives that will allow us to outperform, our industry. And so, you know, we believe that finance is right at the heartbeat of it, and we're pretty excited about, the evolution and the new normal as we pivot from information, providing information to being that strategic partner internally.Closing: (12:23)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Dawn Emling: https://www.linkedin.com/in/dawn-emling-a04b361a/Contact Tjeerd Krumpleman: https://www.linkedin.com/in/tjeerdkrumpelman/Contact Shari Littan: https://www.linkedin.com/in/shari-littan-58bb40114/IMA's Statement of Position on Sustainable Business Information and Management: https://www.imanet.org/insights-and-trendsFULL EPISODE TRANSCRIPTAdam: (00:04) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host, Adam Larson, and I'm here to introduce you to our panel of speakers who joined our podcast to talk about sustainable business and sustainable business information. Shari Littan, IMA's Director of Corporate Reporting Research and Thought Leadership moderated the discussion between Dawn Emling and Tjeerd Krumpelman. Dawn is the head of sustainability initiatives for Lincoln Financial Group. And Tjeerd is the global head of advisory reporting and engagement as well as group sustainability at ABN AMRO Bank N.V. Together, the three of them discuss the purpose and value of sustainable business activities, the impact of reporting and how to overcome potential challenges relating to technology and streamlining processes relating to sustainable business. Keep listening as we head over to the conversation now.  Shari: (01:05) So many of the professionals who now find themselves working in the area of sustainable business came from other backgrounds, other disciplines. The younger professionals, yes, they are finding a way to this area directly from their education. And they can go directly into sustainable business or corporate responsibility teams or whatever companies are calling it. But for the rest of us, we all came from somewhere else because the field is essentially emerging and new. So I'm gonna ask Dawn and than Tjeerd to let us know, where did you come from before you got involved in sustainability? What's your basic background?   Dawn: (01:51) Yeah. Thanks Sherry. I agree with you that most people now are coming from different disciplines. I actually started out in the U.S. government and state department doing human rights work, that also included, a number of, kind of nonprofit roles. And then I was an early practitioner with Credit Suisse, in Asia and then EMIA on sustainability, the first sustainability kind of head for each of those regions so setting that up and then fast forward, I worked at Thompson Reuters on sustainability of global sustainability. And then eventually now I am with Lincoln Financial heading up their, sustainability initiatives. So yeah, kind of a long and windy road here.   Tjeerd: (02:40) Yeah. And for, for me, it's been, it's been a little less windy, because I have always worked in banking. But I worked in the private bank first with clients and then in our investment bank and our retail bank, but always with clients and always on the more commercial side of the bank. And in my recollection, I think sustainability in some sort of, some form has always been part of our conversations with clients, but, but it was like eight years ago when I moved into the group sustainability or group strategy and sustainability team, for the first time that it became, let's say a regular job. And back in that day, or in that time, it wasn't considered a promotion, right. It wasn't considered to be very fancy to move from the commercial side of the bank in a managerial role to a, let's say a cost center like sustainability. So it has evolved a over the years, to becoming quite a popular destination, for people to work, nice place to work with lots of applicants whenever we have a role available. That's interesting to see, but yeah, I came from the commercial side of the bank.   Shari: (03:53) So that's quite a bit of difference: diversity in both of your backgrounds and how you both come and arrive in almost similar roles. So I think that says a lot about the type of work and the almost entrepreneurial mindset of many of the people that you've found or have found in the sustainable business arena. Now, one thing that we are hearing over and over again is that much of the work behind the company inside the company, let me say, internally is crossdisciplinary - that there are people coming from different parts of an organization to work together on sustainable business matters. However, when the finance and accounting function get involved and they bring their skillset, it creates set of capabilities and skills to the work that's going on. And it's incredibly valuable. So if I can hear from both of you, what your experiences are in engaging the-- we'll call them management accountants or accounting and finance function members.   Tjeerd: (05:10) Happy to start to kick this one off. I mean, we need everybody in the sustainability space, right? So we need, so I'm in banking and we need everybody across the bank in all different types to step up from their own skillset. So to embed sustainability into their day to day role. So, facility management takes responsibility for the sustainability of our buildings, right? So, and of the workplace, HR needs to think of travel policies, Risk needs to think of sustainability, embedding into risk policies. And where does controlling and accounting, come into place in measuring, in reporting in disclosing all sustainability. That's where we need the talent and the skill sets of financial professionals and accountants and management accountants. And I think they are relatively late to the party, but they are most welcome. And we need them there in the reporting space, in the disclosure space, in, getting the right quality of data, getting this into the dashboarding, into the steering of companies. That's where we need management accounting. But actually I think we need everybody so I can think of, I can think of a role for IT. I can think of a role for HR, for risk finance, strategy people. We need all of them. And in that sense, we definitely need management accountants as well.   Dawn: (06:37) I would a hundred percent underscore that this is an enterprise-wide effort. We group our kind of work into 16 or 17 business lines and the E, the S, and the G cross, many of them across all of them. I would also just add that we've seen, this is a very evolving landscape. So in the last six to 12 months, for example, we are now focusing on, or we're being, you know, asked to focus on, or we're being pressured to focus on kind of new areas that we didn't six to 12 months ago. And I'll bring out, you know, human capital development, human capital management. During COVID, it was kind of a brand new issue for us to look at under the ESG umbrella or rubric. There's been a lot of focus on strategy in the last 12 to 18 months with TCFD pushing on strategy and governance. So because it's such an evolving space, you really do need senior management across the business units, and that helps you with, in my opinion, it helps you getting acceptance, across the enterprise. If senior management in every line of business is pushing this, then you, you can get enterprise-wide acceptance. You can stay ahead of the evolution because you can say, "Hey, Human Resources, I'm coming to you about this human capital management issue that we're saying, oh, yeah, we've heard about this". And then you keep the momentum going. So I completely agree that all business lines are necessary and we don't know what's coming next. I would take a big guess, as Tjeerd said, metrics, reporting dashboards. I mean, we need people with those skills and that expertise.   Shari: (08:24) Thank you both so much. As you may know, IMA has developed a set of working principles to help us as an organization respond to these global trends. And it informs how we guide our members with educational material, for members in accounting and finance. One of the most critical things that we hear from people in your position are the challenges around fragmentation, that there are too many frameworks, too many guidelines, too many reporting standards. And on top of that there's market pressure to respond to a variety of survey instruments, both the non-governmental as from CDP, but also a range of commercial survey instruments. And for us at IMA, one of the things that we are thinking about and concerned about is whether all of this additional layers of reporting is decision useful. So perhaps a world where there are fewer KPIs, but more meaningful KPIs and reporting might be a beneficial direction to think about in the ecosystem. Could you share your experiences on this?   Tjeerd: (09:45) I'll start, again, and the next question you can start, but I do have an opinion on this and I feel that I know there's a lot of talk about too many frameworks, too many KPIs, but actually I feel that there's a misunderstanding of these frameworks, that there's a lack of understanding that people, need to study first. What is the intention of the framework? The intention of the framework and of the various frameworks they differ, they can be used for different purposes. And yes, we need some sort of convergence and convergence will come. I mean, it will come, but please don't wait for it. But start work now. And I think from the management accounting perspective, they can help to make this, this stuff better, right? So they can get involved and make it better rather than stand on the sideline and be critical. You can be critical and join the game. We need you there. So, and the purpose of all these frameworks is never to come up with KPIs, it could never be the goal. The goal should be to measure progress, to disclose on progress, and ultimately to be able to steer on progress. And that's where maybe KPIs, can be a meaningful contribution. But my suggestion would be rather than to, wait for convergence or to, well, to take notes of the meaning behind these frameworks and to study them and, and then to learn from them and see where, where you can best apply which framework, and then to work on the improvement and developments together with all these sustainability folk, that I've been working on this for so long.   Shari: (11:30) You know, I'm gonna just respond to that. Cause one of the key capabilities that we hear about when management accountants get involved in the process is connecting the information and the request for information to the business model and helping to figure out which is meaningful and which is less relevant to a particular business. And this is incredibly valuable to the entire process. Dawn, do you have a follow up?   Dawn: (12:03) I do. I agree with both of you and not surprisingly, I agree with Tjeerd that these are decision useful. You know, there is a huge landscape of, let's say questions that we respond to, both the survey instruments, as well as, the data providers and the frameworks. So I think the most useful piece of that, if you look at that landscape and for us as an issuer, we probably respond anywhere from 1200 to 1500 questions every year. So it's a massive amount of questions and topics. I do find them decision useful. They guide us, they show us what's coming around the corner. Shout out to CDP for example, and TCFD. They tell us, you know, here's, what's on the horizon. You guys should be thinking about these topics. So I think in and of the themselves, they are decision useful. I think the problem comes and myself and my peers, the problem comes with the rankings based on different weightings. So if you have 1200 data points that you're releasing to the public and 10 different ratings and rankings are using data and putting you on a league table and saying, "Hey, Dawn, you're above your peers today on this ranking, but tomorrow you're gonna be 10 below on this ranking", that becomes a very confusing conversation to have with senior management. And when you start to talk about how the sauces is made on each of those rankings, people fall asleep and rightfully so. So I think what that means for a practitioner in house is that our resources are dispersed. We spend time trying to explain them. We spend trying to understand our stakeholders' favoritism, investors, clients, senior management, employees, activists, NGOs. I mean, we have a ton of stakeholders and they're all kind of focusing in on one or two rankings. And we, the practitioners, the CSR team inside have to spend our time and I'll give an example. Let's say there are three topics this year that we have to work on. It would be great if we just had three topics, my team could go out and just work on those three topics. And, oh, let's look at peer let's look at best in class. Let's look at, you know, frameworks and to improve our processes, structures and governance around those three topics. But because there are so many frameworks and so many rankings, we're dealing with something more like 20 or 30 topics that we have to address, and we don't have the bandwidth for that.   Shari: (14:51) Tjeerd, did you have something to follow up on Dawn's remarks?   Tjeerd: (14:56) Yeah, so I like the, the comment that Dawn made on these rankings and ratings. And I know, again, this is similar to the frameworks. There is conversions there, or standardization is needed. Correlation between the different ranking is too low, on the ESG front. But, and I'm not trying to smooth this out, but I'm just trying to say, I mean, from a board perspective or senior management perspective, it is surprising to me that they do understand the difference between certain credit ratings - and there are differences between credit ratings - but they, they seem to, really have a strong desire to have just one sustainability rating and that to me, or ESG rating. And that to me, is silly because there are so many definitions around sustainability. You can also see CDP is focusing primarily on carbon, MCI, DJI's, more focused on the holistic ES&G well, and there are many others, some are funded by NGOs. So you, if you know that they're funded by NGOs, they will have a different perspective. For me, as a sustainability professional, all that information is valuable. It's valuable information. And I understand that I need some sort of translation to senior management or a board. It needs a translation saying, okay, why is this rating as high or low? And what is the delta and how do we compare to peers? That is the translation that is needed. But if you were to put all these credits in front of me, without any background knowledge on credit ratings, it would need a similar translation. So from my perspective, it is a knowledge issue and a guidance issue. And that is actually how I consider my own role or my team and Dawn's role as well within her company. This stuff needs translation and ideally it doesn't, but in the real world, a lot of this stuff needs translation.   Shari: (17:05) I was just gonna follow up by saying one of the concerns in hearing that positive work by the various rating companies. On the other hand, one point to consider is that a team like Dawn's, an accounting and disclosure team is a limited resource itself. And we should think about going towards a goal where her work is being used to its best use and not continually. I mean, what we want her work and her team to be sustainable and not excessive.   Dawn: (17:46) And I think, you know, I've been in sustainability longer than I want to actually admit publicly, but I think in the last two to three years, it has become a reporting disclosure job. And it wasn't before. Before it was a change management job, it was a knowledge education transfer job. It was bringing everybody with you on this journey. And now it is primarily not just myself, but my peers. It is an ESG disclosure job.   Shari: (18:21) Well to respond to some of these trends and these burdens one thing at IMA that we look to is the power of technology. And one of the reasons I was so excited to do this podcast with Dawn is that she explained to me that she and her team have looked to technology and have built systems to facilitate the information gathering and reporting, and that there have been in enormous benefits. So Dawn, I'd like to hear from you about the process that you went through, the challenges you faced and overcame and what our members could take away from your experiences in looking to the technology.   Dawn: (19:06) Yeah, so we were-- as many, and as I was in a previous job, we were responding to requests and survey instruments, with push and pull Excel or word tracker, you know, changing, changing comments. And we decided to take the time out, you know, the six months to a year that it would take to assess what we're dealing with and look at what was available and build out some kind of automated data management system. We ended up going with, ServiceNow because Lincoln has that already. And there's a team in house that could customize it for us. And we, built out what we now call the ESG tracker. So for each, if you know, ServiceNow, it sends you-- it's a project management tool. It sends you a ticket into your inbox. You can get into the online web based and you can mess around with a ticket. It can have tabs with guidance. You can customize that ticket. We now take all 1200 to 1500 questions that come at us and create a ticket. That ticket then is designated for one or up to five subject matter experts. They get it in the first instance they update, what they think, you know, they've done in the last year. It prepopulates their answer from last year. It comes back to us for kind of ground truth and kind of fact checking, provide any links that we know and new policies that we know about. And then that goes on to, senior management for approval. Once that approval is in the system that we know we can use, the information that's in that ticket. And then we go ahead and upload it. I mean, at some point this is gonna be a direct, you know, feed into the surveys, et cetera. But we found that it's, it's helpful in a lot of ways. The SMEs are really owning it. They know these are their tickets. They know that was their question from last year. They know, oh, here's a new question, they see it come in, they look at the deadline, it's really smooth. We don't have to chase anybody. The system, you know, pings them, "Hey, you're due up". The fascinating and next step for us is the data analysis that goes on behind the themes. So we can put any kind of internal measurements on it, a red, yellow, green light system you're doing really well on this, or, "Hey guys, we can pick up some points over here". We can see, you know, certain business lines are getting a hundred or 200 questions like holy cow, do you really need to see all those? And so we're moving into kind of second phase how we, as the CSR team, to Tjeerd's point, translate that into a much more user friendly system. And we're, you know, going offsite in December to try to see if we can't, take that diversion too. The hours it has saved us is tremendous.   Tjeerd: (22:01) I think this is also a great example of where management accountants, financial accountants can really help us, right? So we are, and I mean, Dawn has done amazing work on getting the data and, and getting the system set up. But this is actually day to day work for a lot of our colleagues within finance. They have been collecting financial data for, well, for a long time. They know how that works, but, and I get the feeling sometimes that they feel that nonfinancial data is from a totally different planet. It's not - it's coming from the same planet. It needs the same checks and balances. It can go through the same type of SAP or whatever type of system that a company is using. And it really improves the quality if it's coming through the same flow. So we've had this traditional sustainability reporting and disclosure workstream in our company and we have a separate finance workstream. And then once we do our reporting or we do these benchmarks or raters, then they come together at the final end. They need to come together before, they need to come together at the point of decision making so relevant financial and non-financial data needs to meet before boards take decisions. And this is, I mean, this is where management accountants can place such an impactful role by taking that responsibility. Not because regulations are forcing us, but because they're experts in data, and, and we are not, we are experts on sustainability. We have an idea on how to save the planet, right, but we don't have an idea on how to measure carbon in all loans or in all assets of the books. And right now that is actually what we are doing. We're coming up with carbon accounting for the financial sector and it's coming and it's working reasonably well. But whenever I talk to a management accountant, he's gonna pinpoint exactly where it's failing and that is in the data gathering, and that's why need them, and we need to work together on this.   Dawn: (24:07) And I would add to that the accounting departments, for sure, and the risk departments. They also manage an incredible - I mean, obviously I'm in an insurance company, so - but they manage an incredible wealth of data also, and our geniuses at it. So if we can present our information and the demands that we're getting in an analytical database presentation, that at some point to Tjeerd's point will like match up with theirs. That would be the ideal that it now it's the same sustainability ESG data is in the risk systems and the accounting systems.   Shari: (24:52) I'm going to add to that. We hear so much about the movement toward getting assurance on ESG reported information, but in order to move to a model that allows for assurance, we need better internal controls, better governance and oversight systems. Before we think about audit in a robust way that we know in financial reporting. So I'm going to ask my final question. And a lot of what we've been talking about is going to sound very expensive, very costly for small to medium size businesses. And in fact, as we observe the regulatory movements, so much of it is focused on public companies, public company disclosure that follows along securities, disclosure, regulations. That seems to be the parallel and where we're headed in the near future, but such a large swath of our economy is non public. And so my question to both of you is how do we make sustainable business information and management relevant and actionable by small and medium size companies that are not public? Is the driver going to come, for example, from supply chain, selling to large companies that are public, or might it come through capital raising, I'd like to hear your view on making it relevant for small and medium size companies.   Tjeerd: (26:40) No, I'm very happy to start here because for me, the-- and I don't want to underestimate this or to make this, to make light of it, because I do understand that there can be a cost involved. It is time consuming. I mean, and it is continuing all the time. So it requires some sort of continuous attention, right? So I don't want to downplay that in any way, but when does it become fun? When does it become helpful? When does it become useful? And that is, if it is providing decision useful information, that is what you're looking for. So if you're approaching this and sometimes we do as a bank, right, from a regulatory perspective, you just need to deliver, you need to comply, which is, well, it's fun for some people, but not for most. If you're approaching this from decision usefulness from actually improving your business, improving your value creation, improving your, the way that you steer your company, no matter what size it is, then it's gonna really, improve your decision making. It's gonna improve the awareness of where you are heading with your company? And that can be said for a very small company and for a very large company as well in similar ways, but that's why one framework doesn't work for all these companies. You'll need to think about it. What is the information that I need? And it can be helpful in numerous ways. It can be easier for you to attract financing. It can be cheaper for you to attract financing. It can lower your risk base. It can improve, customer satisfaction. It can improve pre engagement. It can improve the planet as a whole, if you're into that thing, but ultimately, it improves your decision, making it improves your dashboarding. That is what you want to steer your company on? And you're never just steering on financials. Nobody, I've not met a single board member that says, I just need an Excel sheet with return on equity and, and core equity tier one. And that's how I steer the entire bank. They always need more information. And then the challenge becomes which of the non-financials are actually valuable for me to measure progress and to steer this company, that's the search.   Dawn: (29:04) And from a very practical perspective, I think for a small business or private business, pick one framework or one survey instrument and say, because it's, it hits on the most material issues for your business. And then run that down for two years and see, you know, who did we have to talk to? What kind of data did we have to get that we didn't have before? And then what did it organically encourage us to set as targets? And then that's what we prove to our company is of value. We are setting targets, we're setting a strategy and these questions and this instrument, or this framework have given us the guardrails. And we believe in it because it's been road tested out in the real world by a, you know, a thousand plus, you know, issuing companies. And let's go down this road. We have faith that this instrument or this framework is valuable. So let's do it for two years and don't get scared by Dawn talking about 1200 or 1500 questions like that. Doesn't have to be your world. You know, we're a Fortune, you know, under 200. So we have a lot of eyes on us, but if you're a small business or private choose one and go for it.   Shari: (30:28) I'm just going to add to that. Our view, that what it's really about is value creation, value preservation with a bit more of a long term perspective than we see in traditional financial accounting and reporting. And that so many of the factors that lead to value creation, preservation performance are not necessarily captured. Things like employee engagement. We're watching a competition for talent and we know that the younger generations look to purpose, not just profits. They look for both, and we don't capture that information in our mainstream finance and accounting world, but we know it creates value. Customers that will go the extra mile because they love our business, that's very real to small businesses and how they survive the pandemic. Customers love them and stayed with them. Suppliers stayed with them. We're hearing all sorts of supply chain issues. Well, if you have a good relationship with your suppliers, that relationship doesn't necessarily captured in mainstream traditional accounting, but we know it's creating value. It does translate to cash flows over the long term. It does lower cost of capital management oversight, reduction of risk. And this is why we think that a sustainable business is good business. So thank you both.   Closing: (32:10) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

About Wes Saber: https://www.haribo.com/en-us/about-us/meet-our-board/wes-saberAbout HARIBO: https://www.haribo.com/en-us https://www.linkedin.com/company/haribo-of-america-inc- https://www.instagram.com/haribousa/?hl=en FULL EPISODE TRANSCRIPTAdam: (00:05) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. Here with you again, as your host, Adam Larson, as I kick off episode 157 of our series, Count Me In has shared a number of conversations relating to business transformation, but today's featured guest speaker shares a unique perspective on the topic Wes Saber, CFO of HARIBO of America joined us to talk about how the finance function and finance leaders serve as best copilots for any business transformation journey. Wes is a great leader who constantly encourages his staff as he promotes change and transformation. So keep listening to hear more as we head over the conversation now.  Mitch: (00:54) We have heard a lot about business transformation, particularly in finance and accounting. So to kick off our conversation today from your perspective and through your experiences, really my first question is why? Why is this such an important topic for our listeners?  Wes: (01:09) Thank you very much for having me today. Business transformation is the constant, in the current business world. Business transformation is important to keep the business relevant, the strategy of the business agile and us as professional, very relevant in terms of competency and business acumen as we go. Business transformation is a journey that has different milestone as we grow as a business and as professional, it's very important to be able to adapt change. What makes finance and accounting professionals and overall business professionals successful in their career is the world resilience and business resilience. And us being as professionals, resilience is being demonstrated during business transformation in a form of a project in a form of system change, even culture evolution as well. So there is so many transformation that happens around us. Sometimes we're directly in the middle of it as professional as finance and accounting professional. And sometimes we are in the co-pilot seats and sometimes we're impacted with it. So it's very important to understand where we sit as professional in terms of the business transformation.  Mitch: (02:28) Well, thank you for that. Very good perspective to kick things off. And I want to go in a little bit more about your personal experiences and, you know, your company HARIBO is a 100 year old private company. Now there's been a lot of innovation and modernization since inception. So as an established company, how have you been able to manage such a digital transition over this time?  Wes: (02:51) So, I'm proud to be working me and my colleagues in a company that's privately owned and celebrate a hundred years, December, 2020. And, as we are proud of the values we live and the company, we are, very proud of the projects and the success that we achieve every year. In HARIBO of America, we started a growth journey, starting 2015 and we're embarking in building our brand and our business capability and manufacturing facility and our organization and culture. We are predominantly a European company, that adds most and the majority of the business in Europe, but the North America business is, taking off, starting 2015. So it's kind of like a startup in our hundred years old company and looking into the future, especially after what happens in 2020 with the pandemic. It's important to look at that as a challenge. However, it's more critical to look at that as an opportunity and prepare ourselves, for the future to be able to compete. digitization of business, there can be an aspect of, simply handling data to all the way to producing a product. We are, embarking on, opening our, new first North America manufacturing facility next year in 2022. And, we are talking these days about industry 4.0. Remote guided vehicles, robotics, big data, troubleshootings and to be able to actually utilize our scale and be efficient and get the best quality of our products to consumer. And as a professional and different functions, including manufacturing, engineering, sales, and finance and accounting, everybody plays role in getting that achieved. Sometimes in the most famous example of, digitization in, the finance and accounting world is the ERP implementation or the system that integrate the entire business, from end, to end. And that would include typically the costing that we have, the inventory that we look at, the analysis, the management accounting, the financial accounting, the reporting, the consolidation, of course, we all know about this, but what's changing in the digitization is how do we use PI? What tools we have in the world? What's relevant to our industry and what's relevant to our function? And how is that gonna help the company and educate from now to be competitive and continue to achieve on strategy? So digitization is no longer just, an element of the future, but actually absolutely is, how business is being done today. And it develops, and it develops in a high speed.  Mitch: (05:51) Now you just mentioned, the function specifically, right? How it's impacting the industry, and then it funnels into the individual function. So accounting and finance, how did the finance function specifically play a role in some of the transformation projects that you've been a part of so far? And what would you say are some of the top enablers when it comes to the finance function, going through business transformation, digital transformation, and along those lines?  Wes: (06:18) Absolutely. So everything starts from the strategy of the business and where the business is heading, and everybody plays a role in that, especially finance and accounting and finance and accounting always have two hats in the business, a custodian hat and a co-pilot hat, looking at the business, from a custodianship standpoint, looking at the digitization or the systems or the strategy being a custodian means finance and accounting plays such a critical role in keeping the business in, strong governance environment, understanding risk management. What will we face, during our, growth revenue invoicing, risk management to the plan we set to ourself allocating resources on budget to certain initiatives. So custodian, is very important and everybody in finance and accounting is a custodian by default, it cannot be a custodian or a co-pilot. The percentage might be different of playing a role of custodian, versus a co-pilot. But everybody has whether in account receivable or NGL accountant, or accounting manager, or a financial controller, or a CFO or a financial planner, a co-pilot is a second hat that everybody has. Understanding the business performance is always first step to drive decisions in a business to adjust plans, to, look and review what resources available resources here can be financial resources. It can be, budget. It can be, associates, people, vendor, customers. So the co-pilot is always in for finance and accounting is always in the copilot seat of different functions. So, understanding sales, understanding, marketing, understanding customer marketing service level supply, technology is always a very important part of the success of, finance and accounting professional to play an effective copilot role. I would always say that finance and accounting never sell, buy anything or make anything or purchase anything, but they are the one accountable to make sure that everything is working and delivering the right profit and the right strategy. So we're always on the co-pilot seat and making sure that the business is, under the direct governance and custodianship.  Mitch: (08:45) Yeah, that's a great point. You know, many of our previous conversations on many different topics, always somehow veer towards, you know, the importance of business partnering, right. And being the co-pilot that you're talking about. So particularly within business transformation, obviously it's such a huge responsibility understanding how the whole business is transforming, but then the impact on the financials, right? I mean, that's the number one responsibility, as you were saying, you know, you really oversee all of that sore within these projects and going through business transformation, what are some of the benchmarks or milestones or things that the accounting and finance professionals need to be aware of, keep their eyes on and, you know, ensure that the organization is hitting along this journey, as you said.  Wes: (09:32) Absolutely. From my personal experience, I lived in six different countries and I worked in over 25 countries around the world. It's important to understand the difference in terms of regional accounting standards, U.S. GAAP vs German GAAP or IFRS and not to the top level, but really having at least amazing understanding of how that work and how that impacts, the role in terms of, as well, the, industry, if working as an, accountant, for example, in a service industry is completely different than manufacturing. The way we look at, the general ledger, the trial balance, the process we follow, how we close the month, how we go through another process, it's different, the areas and the focus area might be different. So if I'm an accountant, for example, and I'm very strong in cost accounting, most probably I would be more successful in a manufacturing, in a capital and a growing business versus a service industry, for example. So it's important to have clear match between the capability and the benchmark for comparing ourselves to. During business transformation for example, we look at our competitor and the structure, and we try to set standards for ourself. So a business that's $200 million, how large an organization for accounting should be based on the complexity, a business that invoice 600 customer is different than a business that invoice 100 and the more need for technology is different, but it doesn't mean it's simpler. The lower, the number is simpler or the larger, the number it's more complex. Actually, it's much more into this, which means what's the mission of the company, because I can work for example, for an auditor in the accounting department of an auditor, and I am not immediately interfacing with the customer well, I'm responsible for the back office. So that means my focus at that time would be more in providing a robust finance operation, a robust systems, a robust governance, and, really looking from a different perspective. But if I am working for a company that works in beverages or fast moving consumer goods, product that we all buy in grocery stores, the same job will have more interaction, direct interaction with customer in terms of, collection in terms of cash management, working capital understanding. So it's very important that when we, embark on, business transformation or a project or being part of an organization that we understand where our business sit in light of the industry we operate in, the competition, competitive landscape, as well as the country we operate in. And if we work on a country or more.  Mitch: (12:10) So I really like how you, you know, structured that response because it kind of helps me go into the latter part of this conversation here. You talked a lot about, you know, the financials, but then you kind of got into some of the softer side and some of the people skills. So I I'd like to, you know, ask a couple questions in that area, you know, business transformation you're putting an entire team, or, you know, numerous people in new situations that may require completely new skills oftentimes is we were talking about technology earlier. So as far as what these team members need in order to complete their jobs, how do you go about training them or bringing them up to speed, encouraging them that this is a change that's, you know, not just useful for the organization, but it's helpful to them as an individual, as part of the team as well.  Wes: (13:04) Absolutely. There is absolutely clear two sides of this. One side is the functional side. And one side is the developmental side as a professional. If we talk first about the functional side, is we talk about the functional competency the person would have, and it is kind of like three level of functional competency. And I wanna pick an example of a functional competency, for example, of an accountant. Or for example, an accountant would be able to lead a trial balance is the competency level required for that person can be beginner, is the job just require somebody to understand what's the structure of the trial balance? How do I get data and what do I use, how do I use data, or is it, really essential? Like, somebody who's more competent in dealing with the trial balance and understanding V classes and really can do reconciliation or even professional, which mean really, like kind of an assistant accounting manager, an accounting manager, or controller who must have a professional level of understanding what trial balance. I'm just picking that as an example of a functional competency that would have three different levels. So it's important to look at each other, each one of us and understand, the level of, functional competency on the other side as, a personal development. Very important to look at other competencies like collaboration with other teams as a person working as an individual contributor, being part of a team. How do you collaborate with a team? How do you manage conflict? How do you have conflict management, for example, drive for results, business acumen? So there is the other side, is there is a long list of competency as professional that we must have and possess to be successful, not only just the functional side and not only the personal development side, but both of them comes together to prepare a person to be successful. That brings the learning. So what are we learning at work? Normally people in accounting and finance 70%, based on, studies and statistics and only, but other businesses as well, 70% of the learning happens on the job. So the job that that person is doing must be offering that learning. And I would ask everybody to think twice, if the learning is not 70% of that job, doesn't offer enough learning. And 20% of the learning, can happen in, through project. Like we talked about business transformation or through assignments or, changes that we make in our work, whether it's a system or an additional objective that we have in a year and 10% can happen actually in a classroom, in a year that can be in a classroom set, can be in a training settings or coaching or with mentoring. So 70 20 10 rule is a very famous rule for us to understand where we sit as an individuals and as well, how successful we're gonna be.  Mitch: (16:08) I'm just curious as a quick follow up as a finance leader, understanding these educational needs, essentially. How conscious are you of it, maybe not on a daily basis, but a regular basis. And how do you structure various opportunities, learning opportunities for your team to make sure that they are up to speed? You know, are you aware of particular learning benchmarks per se, anything along those lines.  Wes: (16:34) There is a structured process to do this in every business. And there is unstructured process to achieve that as well. I wanna start with the structure process. So every business would have, a performance management system that would, schedule and organize either a monthly, get together with the line manager or on a quarterly performance review where the professional and the line manager would align on the objective of the year where we are doing set to competency. We need to develop a media review is the most common one that everybody doing in the midyear and the most famous one, well is the tier end. Frequency is important and the quality is even more important and it's not more important than the frequency. So the quality of time spent on understanding, developing smart objectives, being the development areas, the functional competency required, the training needed the 70 20 10 rule, as well as understanding the personal development as a professional is very, important. So that comes and happens under the umbrella overall of the, performance management of the entire business. However, zooming in into the function itself, a finance and accounting here, and the unstructured process, having a CFO or a financial controller myself is very, very important. And it happens constantly, not on a monthly basis, not on a quarterly basis. And that dynamic of open door, on discussion between everyone of us, doesn't start only from the line manager or the leader, but it starts from everyone and a talent will always find a space and opportunity to speak, take initiatives and talk, about requirements for learning and development. And the question at that point would be how do we match the right opportunities we have in the business to their need and the development of the individuals. The more we have that fit, it would be great cause businesses would have great people and great jobs, but doesn't mean it's fit.  Mitch: (18:32) So I'd like to, kind of take what we were just talking about and then go back to the, the main part of the conversation being business transformation. I would assume that as a finance leader, through learning and development, the main goal would be to develop future leaders, right? And the more leaders you have in the organization, the more individuals that can contribute to strategic decision making and contribute to these larger organizational projects. So within business transformation and understanding the team you have working with you, how do you approach strategy, as part of this project? You know, I suppose this really could have been more the first question, you know, how do you go about approaching business transformation, but, you know, to wrap things up and kind of bring it all together, the projects, the goals and the people, how do you formulate that strategic decision making process for the organization?  Wes: (19:28) Absolutely. So, there is a, in terms of leadership, like, understanding the mission and the purpose of the organization and the business is super important for everybody to be successful in every function, including accounting and finance, and every business would have so many large number of projects running at the same time. Some of them are cross-functional and of them are specific to a function. So we may have projects specific to finance and accounting and a long list of other, projects or business transformation project that are cross-functional where finance play a role, understanding how the overall picture of how these project business transformation and fit together is the accountability of leaders to explain to the organization. And I would encourage everybody who's not having that clarity to ask and see clarity. There's absolutely no issue of asking question and understanding how is my project fit with the bigger picture or how my role help, the business transformation or the entire business to be successful? How do I work with my cross functional team, putting this all in perspective and coming to how do we make decisions and the right decision and strategically be clear about what long term looks like is very important. There is a saying that those average strategy and excellence in execution is better than excellent strategy and average execution. And that's the dilemma that every business in a professional go through every day, every month, you can have great plans and great strategy, but if you can't translate that strategy into execution into our business transformation, into our project and have that dynamic of discussion, what do we need to change and what clarity we need to add to the project? It's gonna be a challenge, not only for professionals, but for the entire structure. And with actually question is the, if the strategy is really the right one, cause we can have 10 different good strategy. The question is which one is right. We can have 10 approaches for business transformation. The question is which one is correct for our business and not only for our business, which one we are capable as an organization to do. So to your question, Mitchell, about like capability and success, they are all connected. So the staffing of the company, the style, the company follows the strategy the company has, the structure and the organization design that the business has is very important and that must fit together, to make sure that business transformation is successful as well as we, as professional play a key role in creating and adding value to the business.  Closing: (22:05) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Dr. Sean Stein Smith: https://www.linkedin.com/in/dr-sean-stein-smith-dba-cpa-63307444/President’s Working Group on Financial Markets Releases Report and Recommendations on Stablecoins: https://home.treasury.gov/news/press-releases/jy0454Stablecoins Might Be On The Hot Seat, But Are Integral For Crypto Innovation: https://www.forbes.com/sites/seansteinsmith/2021/11/29/stablecoins-might-be-on-the-hot-seat-but-are-integral-for-crypto-innovation/?sh=6628d556674dFULL EPISODE TRANSCRIPTAdam: (00:04) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host Adam Larson, and for episode 156, we welcome back Dr. Sean Stein Smith. With the constant evolution and advancements around crypto. Sean joins count me in again to talk about various reports and newsworthy information relating to stablecoins and digital assets. From standards on cryptocurrency to NFTs and decentralized finance. You'll want to keep listening to learn about what it all means and hear some of the potential future implications. Let's head over the conversation now.  Mitch: (00:48) So Sean, you've joined us for a few episodes now and in previous conversations you've discussed blockchain. Lastly, we talked about accounting standards for cryptocurrencies. Now there have been more advancements and additional considerations around crypto assets. I'd first like to get your thoughts on the report and the recommendations on stablecoins from the president's working group on financial markets. I know that came out a few weeks ago now, early November. I was just wondering if you can kind of summarize what was included in that report and why it is so important as an update.  Sean: (01:21) Absolutely Mitch. And I'm always happy to be on here talking with you blockchain, crypto asset updates, because it really is one: a hot topic and two: an area that is increasingly of importance for everybody working in accounting, finance, economic roles, whether in industry management or elsewhere. So, so in terms of sort of the highlights and the core points in the president's working group report there really what I would say is that honestly, on the one hand, I would say that the involved actors, right, be it, the OCC, FDIC, private sector corporations had done a pretty good job at outlining the, the base case and the fundamentals for how a stablecoin operates. Right. But on the other hand, they were, I believe a bit overt or unbalanced in terms of how they analyzed the whole stablecoin ecosystem, right. In terms of the pros and the cons. And especially in terms of the, risks, right, that having a actual stablecoin based payment network actually get, get to that level of being used at a commercial level by either corporations or by whole nation states. But, overall, probably the top two or three points there is that one they've, they've done a good job at researching and trying to pull out sort of who the, big players are out there. And there honestly really only are a handful of them and the, and the bulk of the transactions happening in any stablecoin outlook now are handled by a, by a handful of organizations and the bulk of those, transactions are also happen with coins backed on the one-to-one basis at the US dollar. And then two, sort of they also did a good job, I believe at outlining sort of the pros and cons, obviously more on the cons side, but, but a pretty good job at outlining the pros and cons of having a stablecoin based payment network versus the current Fiat based network. And then three. And, and here's where I think there's the most promise, but also the highest risk. On the one hand, they also outlined and by they, I mean, the members of the working group, outlined really what, what, factors and components any organizations trying to use a stablecoin payment network would have to take into account meaning who the counterparties are, who has the insurance, and then how are these platforms and these connections between these different involved organizations able to be secure. And then ultimately the end result of all of that of that conversation and I believe the actual report was about 28 pages. The end result kind of mirrors the policy paper put out by Coinbase back on October. And, and in both of those white papers, both of which were between 15, and 30 pages long. So they aren't massive documents, but the end goal or the end call to action on both documents, which I find quite interesting is this call for a new crypto specific, regulator that, that, that has powers or is imbued with powers by, by Congress to directly oversee all aspects of the, crypto asset space. So overall probably I would give it like a "B Minus" in terms of the output. Cause on the one hand, the working group did a good job at outline the issues, outlining terminology, characteristics, and traits, and, highlighting some of the core issues out there. But they were, I believe a bit unbalanced in their outlook in terms of the pros and the cons.  Mitch: (05:31) It's so funny, you bring that up because I read through the paper and as we got towards the end, you know, particularly when they summarized everything at the end, there's a statement that they gave, it says while the scope of this report is limited to stablecoins, work on digital assets and other innovations related to cryptographic and distributed ledger technology is ongoing throughout the administration. So it sounds like they are aware that they did not cover everything that they needed to necessarily, or maybe something else is in the works. You know, that's kinda where I was going with my next question. Other innovations in this space, can you take a guess at what they might be referring to?  Sean: (06:11) I mean, man, if I had access to that data, I mean, I'd be on a beach somewhere, which, but probably if I had to hazard a guess, I would say that the top two areas, and obviously there have been quite, public comments out of the SEC and the IRS in terms of their really uptick in compliance efforts, collection efforts, enforcement efforts. So I would say that probably one output or outcome that I am sort of eyeing to happen during 2022 is that there is going to be out of some agency don't know which one yet. I would say probably the SEC there is going to be some sort of, framework or guideline to help companies get a better handle on which type of crypto asset falls into which, financial instrument bucket. And by that, I actually mean if I'm issuing a token or a coin, is that gonna be treated as a, equity, security, commodity or some other form of instrument? So I say on the one hand, that's probably an area, that they are trying to work on and by they, if the White House Congress and the various, oversight agencies, and then two, what I would say is that currently I'm hearing quite a bit of, chatter about NFTs, but I haven't hearing quite a bit about NFTs because even though now the conversation around NFTs is, you know, kind of focused on like the Board Ape NFTs and you know, Beeple in March of this year. And it's more athlete and artist and artwork focused the implications for this new type of crypto asset nonfunctional token, or, NFT are actually quite broad. So I would not be surprised at all if, you know, going forward NFTs are an area that the White House and policy makers and regulators try to really get a handle on, right. Because they because on the one hand, Bitcoin is the headline news story, but that's kind of old news, in terms of hacks and other policy choices, right? Like it or not, they've sort of outlined how they view Bitcoin. And now in this president's working group, they've basically started the ball rolling on trying to regulate, any stablecoin issuers, whether, whether it's correct or not is a whole other conversation. But, and so then I would say NFTs are the next big area. And then DeFi is also probably the, the next area. I'd say NFT's more concrete, because to be honest with you, DeFi is still, a fast moving and it is so new that I don't think many policy makers have the, expertise to have a real conversation around DeFi quite yet.  Mitch: (09:28) So let's stay there for a second. I know you referenced getting to NFTs and I guess, you know, we can transition there first and we'll jump back to, to where we need to. NFTs were so hot, again, non fungible tokens, so popular. It seemed like everybody was talking about it. as early as you know, it seems like yesterday, but then at the same time, it seems like it's cooled off pretty quickly compared to something like Bitcoin or some of the other stablecoins. So what, what happened? Are we missing something or is it still heating up? You know, what's the status on NFTs?  Sean: (10:00) NFTs are an extremely interesting area, right? Because as I was saying, just, earlier that the guess one of the main focus has been on, you know, artwork and entertainers, Tom Brady's in it now. John Cena is in it now, you know, there are all of these athletes and entertainers that have either, you know, committed their own NFTs or have been endorsed by NFT trading platforms all the rest. So yes, absolutely. Right now, there is some fraud out there in the NFT space and actually during the middle of November, there actually was a headline that actually quite a few of the more recently issued as of that time NFTs dropped by 80% in economic value, which I think is obviously bad if you are a holder, of those NFTs during that drop. But, you know, it's a correction and it's painful, but it's part of how the asset class is ultimately is ultimately gonna have to grow, right. Because sure, NFTs are new and they're hot sort of frothy, but the underlying economic opportunity in a NFT niche, it's a traceable transparent immutable record of ownership in a, virtual world. And so that idea, that concept is tremendous, right? So that's really, and I know saying that that the real story is in blockchain is an old phrase, right? It's an old hope at this point, folks joke about it, but it's the first application that I've seen LIGO mainstream that highlights the true opportunity of blockchain for the individual, right? 'cause most enterprise applications at these, you know, Fortune 1000 companies, you know, aren't really comprehendible to the average person on the street. Right? But the idea of a NFT that now I own in the virtual sense, right? I own a portion. I own a share, I own some rights to some other asset and it's on the blockchain. So traceable transparent, can't be hacked and I can prove it to anybody at any time, anywhere. That opportunity is absolutely I think really untapped, but to go back your actual question. Yeah. I mean the NFT's life cycle, it, I think peaked in March, well, first peak was in March, right when we had the, people auction. And, you know, I say March and April was red, hot cooled off over the summer, much like the other crypto assets out there. And then honestly, in the fall. And I believe it was Tom Brady partnering with, I believe the company is FTX, his partnership, I believe it was him, Gronk, and a whole host of other athletes and entertainers, NBA. Top Shot's probably the, the mainstream platform that most the people have heard of in the NFT space. All of that has kind of given the NFT space, sort of a new, burst of energy. So it's hot. It isn't as hot as it had been previously, but it is, I think starting to ratchet back up to those levels.  Mitch: (13:34) Now I am most familiar with NFTs because of, you know, Top Shot, like you just mentioned, and Brady is coming out with all of his, NFTs and all the different people who are joining in on his group, having conversations outside of here and with friends and, you know, offline, I think the challenge is really identifying how is this so much different than like a picture online, essentially, you know? And I had this conversation with a couple people, and I think what you just said, as far as the blockchain technology and tracking everything is really the answer, but at a very simple level, is it the fact that it's exclusive, right? You know, if you have a tangible basketball card versus an NFT, the exclusivity of it is what adds value is that correct?  Sean: (14:20) So, so a good, parallel, right. That I've been trying to use is that if you have a NBA basketball card and it's autographed by who ever your, you know, favorite players, Kobe Bryant, Michael Jordan, Shaq, all the rest. Right? And so I have this, this basketball, and it's actually signed by that person, Michael Jordan held the Sharpie and actually signed. Okay. And then on the other hand, I have that exact same basketball. Right. But it has the autograph of Michael Jordan, but it was, you know, burned into the basketball at a factory, which one has more value? It's the, it's the basketball that is, that is actually connected to the entertainer, to the artist, to the creator of that asset. Right. And so if I have a picture, if I have the, Mona Lisa famous painting in the world price with that, I'm no art expert so I don't quite get it personally, but, either way, right. It's a, you know, internationally famous paint thing, priceless why? Right. It's priceless. And it's valuable because it is the only one out there. Right. It's the only real authentic version of it as far as we know, but, I can go online, I can Google it right now on this podcast with you, I can go online, pull a picture of it, print it out, frame it, hang it on the wall that doesn't have any economic value, but an NFT, right, tracing the, the Providence and the history of that artwork or real estate or, athletes merchandise. That's the true economic value there. It is not always the asset itself. It's the connection of the asset to the creator of that asset. Be it artwork, entertainment, real estate, it's that bright line, it's that proof of ownership and Providence, and anybody who's done any work in any supply chain over the last 18 months knows the importance of having control and having traceability in terms of, you know, Providence ownership of that asset on that path. So that's the real difference there, Mitch, is that now I have that direct connection to that basketball hand sign by Michael Jordan, as opposed to buying 85, you know, basketballs online that have his autographs, but it was a copy and paged up at some factor.  Mitch: (17:08) Perfect example. You're absolutely right. It definitely makes sense. So thank you for kind of breaking that down step by step. I think there is so much that goes on in this space and everything is changing so rapidly, you know, it, it's really good to provide updates like this, take a step back, make sure everybody really understands what everybody is talking about before something new comes out. Right. And, you know, I think you are just talking in alignment with NFTs. You mentioned defi, right? So I think it's only appropriate that we kind of stay in line here. Give us a breakdown of defi, why it's so important and what our listeners really need to know.  Sean: (17:47) Mitch, I mean, yeah. We could be here talking on DeFi for eight hours, so probably have a fresh battery. But in terms of like the baseline, right. DeFi, it's an incredibly complicated topic because it's a umbrella term, right. DeFi can actually point to anywhere between 12 and 15 different types of applications, it could be yield farming, staking block rewards, all of which are trying to maximize the, yield earned on crypto holdings, but the overall idea and the goal of any of these applications, right. And there are any number of them online to go into, you know, research learn about rest, but the overall goal here DeFi, decentralized finance, it's to try to really build out a parallel financial system. Right. Because, if we sort of pull back for a minute, the whole goal of blockchain and crypto is to help develop a parallel financial system, right. To cut out intermediaries payment processors banks, that, that hasn't happened as we've seen every major payment processor and bank and corporation, and actively now embrace blockchain, crypto payments all the rest. But the promise of, project DeFi it's really to allow individuals or institutions who are trying to, for lack of a better term exist in a crypto based world. So Mitch, if you have $8,000 cash hanging around, right, you have options could put it into bank, could put it into Apple stock, can buy some CPE courses at the IMA, or can put it into a ETF, right. But you have options. You can either grow it, use it all the rest. But if I have that same $8,000 value in tether, right. the USDT token issued by tether a stablecoin issuer that's supposedly on a one-to-one basis at the US dollar. And I could go on a hold, offshoot on that, but, but it's backed by the US dollar. And so how can I make the best use of that money? Well, the bulk of these DeFi applications out there are built to allow holders and individuals and entrepreneurs for like me who have their business or have holdings in crypto. I can't deposit those at the bank. If I can't use those to go buy Apple stock, I can't put them into a ETF or an IRA directly. So then how do I earn a rate of return on my assets? And that's the question that most of these DeFi applications are trying to answer. And so the best way to understand DeFi is to basically kind of picture it as trying to offer all of the products and services, convenience of a bank or a traditional, brokerage, except not involving a bank or a traditional brokerage. And so that's the best way to try to think about it in terms of enterprise applications, there are not all that many yet for the very reason that the regulation on these companies is kind of still murky and it's primarily been, regulation by lawsuit up until now.  Mitch: (21:35) So we've talked about a lot of different trends going on here, and, you know, a lot of our conversation has been US based and things that are happening within the United States. Just curious, before we wrap up, I have one more follow up question, but as far as the things that are happening in the US, you know, the president's working group, I know there was, the infrastructure bill that's going to include some tax reporting provisions for digital assets, in your opinion, what kind of implications will these decisions have on the global environment, as it pertains to digital assets, you know, clearly digital assets is not just the US based assets. So, what else can the global business environment expect down the road from things happening.  Sean: (22:19) And you highlight a excellent point there, Mitch, that this asset class is not based out of any market. This isn't based out of the US, based out of mainland China, or Europe, or Africa, Latin America, anywhere it's a truly global asset class and global ecosystem. And so on the one hand, I am encouraged that there are policy moves being at least put forward here in the US. On the other hand, I do fear that we are taking a bit of a heavy handed approach to trying to understand, and we're trying to force, crypto assets to fit into the current roles that current financial instrument hold and it could work on the surface, but it is not gonna work going forward. But on the other hand, even though crypto is a truly global industry, it is still worth mentioning that the US is, I believe gonna have a important voice in how these rules and frameworks are ultimately crafted. Now there are countries El Salvador Malta, other areas of the world, Estonia, Brazil, you know, there are any number of other countries that have been more active in being pro crypto out there. So it's important for us to balance our attempts to protect, investors and all the rest with the eye towards future opportunities. But my sort of wrap up point here in terms of the global impacts is that the only other global counterweight at the US level is mainland China. And whether you are a fan of this choice or not their choice on a policy, angle to ban crypto, basically over and over again, to ban trading, to ban mining to ban holding of it. I mean, that does basically open up the door for the US to basically still have a initially dominant voice in this conversation.  Mitch: (24:37) So to wrap things up, kind of in that vein, you, you have obviously done a ton of research on this. This is, you know, your passion and, and highly knowledgeable. I'm curious, you know, talking about the report that came out and some of the, movement that has been made recently, you have an opinion, and I'd just like to kind of wrap things up by asking you where you believe the focus really should be when it comes to digital assets. You know, as far as the progressing this whole industry really forward with all the different trends and all the different outcomes from these different innovations, opportunities, possibilities, what should be, as far as the focus of everybody's efforts, what would make the most sense to bring things to light for everybody who's involved in this industry.  Sean: (25:27) I think that the top two areas that should be top of mind for any policy maker, regulator, or entrepreneur out there in this space on the one, it should try to be the foster innovation and creativity, right? Crypto assets are a $3 trillion asset class, and 10 years ago they hardly existed. So it's grown incredibly fast and, and no asset class grows that quickly on a international basis if there is not some underlying economic value too. Right? So, it's important to foster innovation to try to attract as much capital and people, right. You know, intellectual capital, human capital, financial capital, as we possibly can to these projects because Mitch, you know, it's awfully tempting to, to point to, you know, incidents, right. It could be a hack, it can be the NFT bubble, you know, kind of popping here and there, but overall with blockchain and crypto one don't exist in a bubble, right? They are evolving with and being improved by automation and RPA, AI, and IOT analytics. All of these tools are developing hand in hand. And so I think that overall, everybody should be focused on trying to create a environment and a framework to foster innovation, and to try to allow people the, you know, freedom to develop the experiment and yes, fail sometimes. But it's important to have that creative process happen, to be able to get to the products and services and companies that are gonna benefit the most people going forward. And then two, it's also important that as we are doing this right, so a good parallel that I can do all the right now that's all phase highlight is that as we all know the issues around, our climate and climate change are a big issue right now, I won't get into the individual politics of it, but it's an issue, right? And so there has been a move towards more ESG, towards more investment, towards wind, water, hydro power, all the rest, but all of that can't happen overnight, right? There has to be a transition period off of the coal fossil fuel model and into a more hybrid model, right? Some fossil fuel, nuclear, wind, the water, solar all the rest. And so that has to also happen here, right? Because at a fundamental level, blockchain and crypto assets operate differently in terms of the transactions themselves and the risks and opportunities that all involve counterparties have to keep in mind as they try to move into this space. So there has to be some sort of plan, again, building on 0.1, there has to be a environment and a framework to balance innovation and creativity with this, mindset that, yeah, mean virtual payments, digital they're already here, all that we're doing now, blockchain and crypto is trying to sort of improve them. But there has to be a process to transition, you know, countries, institutions, individuals out of basically the analog world that all of us live in web 2.0 all the rest to a blockchain based crypto, augmented future. And I know that having that can kind of sound high in the sky, but it's already happening right now. Right. And there are trillions at, you know, being put to work here. Every major corporation and country in the world is actively doing this as we speak. So it really isn't so farfetched, I would just hope to see right. That going forward, that there's a more over focus paid to this.  Closing: (29:40) This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Jennifer Wolfenbarger, CMA: https://www.linkedin.com/in/jennifer-wolfenbarger-cma-5534ab1/FULL EPISODE TRANSCRIPTMitch: (00:05)Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host Mitch Roshong. And today you will be listening to episode 155 of our series. The speaker on today's podcast is Jennifer Wolfenbarger. Jennifer is the vice president of finance at Owens Corning. She is a success driven, high impact and commercially astute executive that has a history of driving value creation, excelling in dynamic, fast paced and demanding environments, and one who has a passion for driving continuous improvement. So it is only appropriate that her focus for today's episode is on business transformation. Specifically, Jennifer addresses the role the finance function plays in enabling transformation and the need for effective change management. Keep listening to hear more as we jump over to the conversation now.Adam: (01:05)So today we're talking about business transformation and it's a term we're hearing a lot in finance and accounting and to get started. I just wanted to take, get your take on why is it so important now, especially?Jennifer: (01:16)Yeah, I think, is a great question and, you know, no matter what industry you operate in and I've, I've had the opportunity to operate in, you know, heavy equipment, building construction products, automotive med tech, and now, and building construction products. And no matter what industry you operate in, it's likely competitive. And the question is how do you differentiate yourself financially from your competitors? And what I've found over the course of my experiences at margin expansion is super, super critical. And business transformation is a key enabler to, to margin expansion, process improvement, like LEAN have been around for decades and typically drive incremental gains, which is important, but transformation is really key to moving the needle on margin expansion significantly to the point where, you know, you're, you're looking at revaluing, potentially the, the value of your company, business transformation is also critical to, you know, to a business culture, to be readily adaptable, to capitalize on opportunities to improve, whether it be through business growth or cost transformation, supply chain, transformation, et cetera, you know, having a culture of business transformation where it's, it's feels as natural as it possibly can is a game changer for a company and really a differentiator.Adam: (02:46)So when we're looking at the finance function specifically, they're going to play a role in completing the, that transformation. So how does the finance function play a role and then what are some of its top enablers?Jennifer: (02:57)Sure, sure. You know, I see the finance function playing a number of key roles and oftentimes may not even feel like they're really finance roles, not only in just completing the transformation, but also really kind of, even before you, you set the set, forward on, on, transformation itself, a key key role. They play finance plays is an identifying opportunities for transformation. And, you know, no matter from my experience, no matter where you are in, in terms of organizational capability and so forth, there are always opportunities. And sometimes prioritizing those opportunities is, is half is, is a battle in and of itself. So that's where finance plays a unique role in identifying and also helping prioritize what are what's going to make, you know, give us the biggest bang for our buck, the biggest return on investment, and be key to really moving the needle from an enterprise perspective. Then once the transformation opportunities identified, finance plays another key role in establishing governments, governance structures around how we measure progress, how we stay on track, how we stay on scope, through our goals, scope creep is, is, is quite common, particularly in transformation initiatives. And so it's important that we stay, that we have guard rails and governance systems to keep us on track. And these structures may not necessarily be financial. Oftentimes they're not financial guardrails, many times they could be operational or timeline-based, what have you, but finance plays a huge role in, in establishing governance structures. These, these structures are really critical in terms of ensuring how, how we hold, the necessary and applicable leaders that are driving the transformation, how we hold them accountable and also highlight early and often where we might need to course correct, which is, which is super important to enabling the success of a transformation. Some of the top enablers for completing transformation. I would say data can't be underscored data often plays a big role in, something that I'll likely talk about as we get into the podcasts a little further, but change management is super important in any transformation. And oftentimes that really what that means is influencing. And, it might mean getting, getting key stakeholders on board, but this is not only what we need to do, but how we need to do it from a transformation perspective. And then I'd say, lastly, enterprise focus is a key enabler. This isn't about hitting an isolated goal. When we're talking about transformation, this is about really shifting the needle on our enterprise performance. And I mentioned change management that is so easily overlooked in, in transformation. And what I've found from my experience, you need to ensure that you properly invest in train change management, because what you're going to find is that no matter how much data you put out there and how convincing it is that we need to take action. And, and this is how we need to take action, not everyone in the business is going to be on board. And that could be day one day, two days, day 30. So it's important that we go through that we take the time to invest in, in change management and ensure that we have everyone that's involved in the transformation marching in the same direction.Adam: (06:47)Of course. So it's like you're steering a massive ship and you gotta make sure everybody's doing all their parts to get where you're going in a sense. Right,Jennifer: (06:56)Exactly. Exactly. I was just going to add to that, you know, I think, you know, choosing the folks, the team members that are part of the transformation are super important. You kind of touched on that a little bit, made me think of that, about this is that diversity in terms of an address diversity in terms of gender ethnicity, it's diversity of thought is super important as we, you know, we think about who we want on, the, the, the stakeholder, the leadership team of the transformation is super important, so that we do challenge one another. And, and where that change management plays a big role, as we all agree that this is the goal that we have in mind and how we get there might vary along the way as we kind of challenge one another. I think that's, that's super important too.Adam: (07:46)So we've talked like it's this massive ship, it's a big thing. Like transformation is, is big and it affects everybody. And so there's gotta be key benchmarks and milestones that you have to be aware of. Can you talk us through some of those that you, cause obviously you've gone through transformation many times.Jennifer: (08:03)Sure, sure. You know what I've seen oftentimes, and I'm going to start with a little bit of what I think it is not an acceptable benchmark. What I've seen is, is, and not to name names of, I've seen actually in previous employers, previous companies I've worked for that. We're really keen to benchmark against themselves. In other words, picking a previous period and saying, we want to improve 10%, you know, based upon our last five-year Kager or whatever. And they set targets based on internal benchmarks and what I really encourage, and I've encouraged. The last few transformations I've been through is, is encourage the business that think like an investor in what an investor is thinking about when they're looking at a company is, you know, what is the best look like for this particular industry? And it may even include other industries as well. You know, I, I picked on LEAN and the automotive industry is historically been, you know, the, the benchmark for manufacturing, automation, operational improvement, and you could easily find yourself in a space to say, well, we're not automotive, so that's not a realistic target, but it's a good starting point to say, well, who's the best at this. And it may not even be within our industry and then establishing your targets based on what you, what would shift an investor to value your business higher than it is today. What's going to be a key differentiator that they're going to look at. So it really is stepping back and thinking, putting yourself in the shoes of an investor and saying, what is it, what are the, and you may even be talking to some of your, your key, key invest investor stakeholders to say, what, what is it that you are looking for? I think that's a good starting point. This tactic also helps with change management because it's really hard to argue, you know, with wanting to shift the overall value of the company moving forward. We're all at the end of the day - and I use this often - we're all, stakeholders stockholders in the company. Oftentimes particularly if it's a public company, we're all stakeholders. So we all value. We all benefit by, the company value shifting in the upward trajectory. So, that's, that's, that's where, where I focus, you know, from a benchmark perspective is shy away from those internal benchmarks. Those can be very easy. It's so easy to get into the trap of, well, we're so different. And we don't line up perfectly to our competition. It doesn't really matter at the end of the day.Adam: (10:45)So, you know, you mentioned that at the end of the day, everybody is kind of, you know, we're all stakeholders in the organization that we're in. And you've mentioned also that change management is very important and investing in that, how do you get the people who are supposed to be invested the everyday employees involved to get on board with that change management? What are some methods that you've done to help people along the way? Because that's a big part of the transformation.Jennifer: (11:11)It is. And that's, that's where investing in spending the time in, in change management is so important because oftentimes it's, it's individual in nature and one leader can't talk to all the individuals that are, gonna play a part. So it, oftentimes I find is it's top-down and what I've found works the best is, is helping individuals that are going to be key in moving the, moving the ball forward, helping them find the connection themselves. And, it's all about, I read a book and I'm going to butcher the title, but it's around purpose. And I think that's important, not only in the book was written more about vision and mission statements, but it's also the key to any transformation is finding the purpose. And that's very individual for, you know, depending upon what function you're playing and what role you're playing in a transformation, finding your true north, your purpose in, in that transformation is it goes a long way. It's, it's super critical. It's it's table stakes in terms of, of change management. And when you get there, now you have advocates that are, are going to be peer advocates to others, in the transformation journey, they're going to be the salespeople that, that help, you know, solve a benefit and the importance of the transformation. So, yeah.Adam: (12:38)It's finding your "why" in a sense, the purpose, finding your "why", and that gets everybody kind of, it helps them find their inspiration to keep going in a sense. Right?Jennifer: (12:48)Absolutely. Absolutely.Adam: (12:51)I'm sure as you go through transformation, the team faces new situations, and we just talked about change management and helping people find their "why", but also there's new skills that sometimes we get required. How do you encourage members of your team to take on jobs they weren't necessarily trained or equipped to do?Jennifer: (13:08)Absolutely. I, you know, I think this is the key here is, and I've been super privileged to work for a few different companies that really valued development. And, you know, these opportunities to participate in business transformation are huge from a development perspective. And I found in certain circumstances, you know, if you come into a company that's not, had a lot of history in business transformation, there's not a lot of people that have that experience. And so finding, giving folks the opportunity to, to step up and along with, you know, it's important to give them a safety net, and that might be in the form of a mentor or, you know, might be formal training. It might be a regular forum to talk about where they need help or where they're hitting roadblocks. I think it's super critical not to throw team members into the deep end, without a life preserver, so to speak, but these opportunities are huge from a development opportunity and really the folks that have had the opportunity to be a part of business transformation. And that could be, that could be as, as simple as implementing a new data analytics package, or it could be as big as, you know, strategic business transformation where we're taking the business to a new level, whether it be cost transformation or growth into a new segment, and these types of opportunities don't come around all that often and it's, but when you've had the opportunity to experience it, it's just, it's huge. From a leadership perspective, I look back on my own personal experience. And, you know, when I, when I was part of my first business transformation, I had no experience, you know, I came in pretty raw, but what I learned looking back has really propelled, where I, I went in my career from that point forward and it equipped me with so much knowledge and lessons learned and not everything went right. And, you know, reflecting back on, on that super important from a transformation perspective. But what I learned from those opportunities was a game changer in my career and really helped shape where I've been able to get to in my current position. So huge, huge development opportunity, and, you know, not every, every individual is going to be is maybe cut out for business transformation. It does take some pretty thick skin, depending upon the, the lift, but what a huge opportunity. And, if there's that ambition, oftentimes the other pieces are very, very trainable and that individual is going to be in a very different spot at the end of the transformation. So, yeah.Adam: (16:01)So I would be remiss in talking about business transformation and not discuss strategic decision-making because that's a big part of this. And so as we kind of wrap up our conversation, what's your approach to strategic decision-making.Jennifer: (16:14)Yeah. So it's a big, that's a pretty big question. And so where I would kind of start in terms of strategic decision-making is, is really properly understanding and making sure that we, have a good grip on our strategy here at the company that I'm currently part of. We refresh our strategy every year, and it may not be a complete revamp, but being very, very familiar with your strategy and, and really leveraging this as a beacon in terms of decision-making is super important. And that could be, you know, whether it's determining whether or not we invest in a particular growth initiative, it starts with strategic fit. And we much like many other companies, it's not rocket science. We do a SWOT analysis and, you know, strength, weakness, opportunities, and threats, and understanding that for your company is super important. And then how, how did that, educate or inform the strategy that you set out is super important, as a guidepost for strategic decision-making. And, you know, I'd say in addition to that, so that's really kind of the starting point doing a really good job of identifying the risks and opportunities of that particular opportunity is, is really important as well. And I recommend, involving various, I talked about diversity and, and when I talk about diversity, I'm thinking diversity of thought, getting a few folks in the room that are going to bring different perspectives is super important as you're insuring the decision that you're embarking on and the direction that you're headed is a good strategic fit and we've captured properly. And we're well-informed on the risks and opportunities before heading into that different industries or move at a different pace as well. So all of that, that I said sounds like it takes an awful lot of time and building a nimbleness around this is super important because many industries are fast-paced moving. And if, if we're not able to make agile decisions, we could potentially miss the boat. And, you know, that plays, I've seen that play heavily into, let's just say merger and acquisition decisions. You know, you find a great gem of a, an opportunity likely there are five other organizations that have also lasered in on that opportunity. So being agile and really having a good grip on a strategic fit and what that means for your organization, as well as being able to quickly move through the risks and opportunities and, and kind of stay quarterly holder alignment is, is super critical.Adam: (18:57)It's almost like you need the right people in the right room all the time. And that kind of goes back to what you were saying about change management and making sure that when you're getting to these points of these decisions, there's okay. I need to make sure I have the right people here to have that diversity of thought that you were talking about. Cause everybody's had the same life decisions, same work, just work experiences to make sure that they can bring the right things to the table, not be afraid to bring up saying, Hey, Hey, I went through that same thing here, and this is my experience, as opposed to everybody just kind of being yes, Yes People, which isn't what you want in that room, right?Jennifer: (19:29)Not at all, not at all. you know, it's, it's we always say a good, good, a bit of healthy debate. And then walking out of the room unified in terms of the direction that we're headed is, is our, our goal throughout, you know, these big decisions.Closing: (19:47)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Michael Burdick: https://www.linkedin.com/in/michaeldburdick/Visit Paro: https://paro.io/Blog Posts from Paro: https://paro.io/blog/modern-finance-department-functions-roles-approaches-evolving/ https://paro.io/blog/democratization-of-professional-talent-transforming-how-we-work/ https://paro.io/blog/save-costs-through-freelance-talent/ https://paro.io/blog/expert-success-story-cfo-marine-journey/ FULL EPISODE TRANSCRIPTAdam: (00:05) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host Adam Larson, and I'm pleased to introduce Paro's CFO and Chief Strategy Officer, Michael Burdick, Michael founded his company with the goal of reimagining the finance and accounting industry via the freelance economy. In this episode, he talks with Mitch about how the future of finance really comes down to the freedom of choice and the ability to quickly solve problems for the business. Keep listening to learn more about on-demand fractional talent and the future of work,  Mitch: (00:45) The future of work, or more specifically for our listeners, you know, the future of finance. It's talked about a lot when it comes to what the profession needs to know. And I think as we were kind of just discussing it, it's been a popular topic, but obviously much has changed in the last year or so since the future of work really came to light. So I'm curious from your perspective, why is it talked about so much? How do you define the future of finance, the future of work, you know, and what does it really mean to you?  Michael: (01:17) Sure. Well, first off, thanks for having me. And I'm excited to dig in on this question and related topics in terms of the future of work. I think taking a step back, we need to discuss, you know, the, the changes that COVID had on worker preferences and how we all approach work in general. It was COVID was a giant mass social experiment in remote work. We're all forced to do it. And, and being forced to work remotely, all business professionals for the first time realized how mobile they can be. I think that's an important thing to call out here because prior to COVID, pre pandemic, people wanted to express that choice and have that flexibility and work on their own terms, but didn't necessarily have the platform or the burning platform really for that change specifically to occur. And now what we're seeing is a big shift in how worker preferences are popping up and specifically that people want to work remotely. You can't put that genie back in the bottle, business professionals want to work on their own terms. You know, you see all these big public battles going on at, major tech companies, even PWC announcing that, you know, I don't know something like a hundred thousand of their workers will be permanently remote. And the thing is in the future of work, it's all about that choice and flexibility that people want, and aligning that with what company's demands are. So that's a little bit of context and backstory, but I think this is really a major change, a major period of change, specifically as it relates to how financial institutions, accounting firms, enterprises approach work in general. And I think it's, foundational in a few different regards, specifically, allowing people to exercise that choice in an industry that was previously very hesitant to adopt. you know, we're talking about a pretty risk averse industry in general, so pretty hesitant to adopt futuristic approaches and demands that are being forced on finance departments are multifaceted and what's valued is flexibility and agility, which by the way, the future of work does offer. So I don't know, I think this is just a major period for change. You know, what the context being that COVID accelerated a lot of that change.  Mitch: (03:43) Yeah, that's exactly it. And I think we did a lot of research on the future of work, and this is going back, like you said, pre pandemic, and a lot of the ideas were quickly put into place, right? So the idea of future of finance, future of work, it's evolving just as fast as, you know, what we're seeing underneath our feet. So, you know, taking this a step further, where else can this really go in your opinion? You know, the future of work is, is now essentially. So what differentiates the current state of finance from what the new future of finance may look like?  Michael: (04:18) Current state from new future of finance? Well, let's take a step back. I think it's important to define future of work a little bit more and unpack that if it's okay, because that's a, that's a very big, bold statement that can mean multiple different things. Future of work can encompass the technology and tools that are necessary for working remotely. For example, it can also refer specifically to worker automation, right? Machine learning. It can also refer to how people work specifically for Paro and how we're looking at worker preference changes is related to the freelance economy. So I did want to highlight that for us future work and freelance economy, we sort of use those interchangeably because there are additional forces at play here. that dictate what the future of work is going to look like. But specifically for us, we're, we're looking at the freelance economy.  Mitch: (05:18) I appreciate you sharing that context because it does, you know, there are different interpretations, different definitions and, you know, to speak to the freelance economy, as you said, that's actually the first time I've heard something like that. So I think now getting your perspective on, you know, kind of, like I said, what do you anticipate becoming more prevalent in this freelance economy? I would say, freelance was something that was futuristic almost for the accounting profession, not too long ago. And now you're saying it's, it's pretty much, you know, a part of your company. so what do you see becoming more prevalent and, you know, how do you kind of differentiate the current state from your definition of the future of work?  Michael: (06:01) Yeah, so I think there are three key things that are gaining momentum very quickly, specifically as it relates to the future of work and freelance economy. One is on-demand expertise. If you really think about what a firm model or a job or working at a large company entails pretty much requires the worker to morph and change into. It's almost like a fitting around peg into a square hole. The worker has to adapt to what the company requires and on-demand expertise in the future of work. It's really enabling the individual to express their individual creativity skills and preferences. And so I think that's a key distinction, to, as remote work. I, I brought this up earlier as it relates to context and post COVID changes. We really can't put that genie back in the bottle. Once people have experienced what it's like to work remotely, if you will, again, you know, talking about Google and Apple and all these major tech companies pushing back their in person, requirements and, you know, PWC even going almost fully remote that, that, that's just something, once you experience it and, and once it's been opened up, it's really hard to revert back. So I think remote work is here to stay. And then third is related to individual choice and I was kind of alluding to this as it relates to on-demand expertise, but choice is something that I think we've all wanted to express at one point in our careers. You know, there's something that, that doesn't fit, right? Maybe it's work-life balance, you know, thinking about commuting into the office two hours each way. and all of that lost time that you could be spending with family, for example, that's a choice that we make and sometimes those choices are limited and the future work in the freelance economy. I think part of this is opening up the options and the choices that we have at our disposal. And so I think it's those three things, key things is on-demand expertise two is remote work and three is choice.  Mitch: (08:10) Those are all really good points. And, you know, I kind of want to follow up on each of them, you know, if I, can and you let me know what you think, but you know, we're talking about this idea of becoming more prevalent and you listed a bunch of companies who have bought into the remote work, right? We've all seen, indefinite, you know, remote work or at least pushing it out to sometime 2022, whatever the case may be. So if it is remote work, maybe it's the idea of freedom of choice. Like you were saying, really giving into, what the employees need within the organization. Or if it's just the on demand piece of this, I'm sure there are challenges is what I'm getting at. Right? And some of the more traditional organizations probably have organizational decision makers who don't quite buy into this, right. They still want to go back to the old ways. So what do you think it's going to take for some of these businesses, some of these individuals to really buy into these three components of the future of work that you just laid out for us.  Michael: (09:14) I'm going to bifurcate this in two, companies and workers, you know, the business professionals for companies there is on average, an old school, old guard mentality where, you know, I need face time, but I value butts in seats. I value, you know, you clocking in and clocking out and that's not what workers are looking for. They want that choice, flexibility, autonomy, freedom, also to feel like they've, self-actualized, you know, they've reached almost the peak of their worker preference pyramid. You know, if you want to think about it as the Maslow's hierarchy of needs, foundational layers for workers, or, you know, income and stability, all the way up to, at the top would be like, self-actualization, you know, feeling like they're making a difference, feeling fulfilled, you know, and in between there could be like community and, you know, feeling like it sends a comradery. And so if you look at that holistic pyramid, that's a lot for somebody to actually like, feel empowered, to leave a full-time job and go out and express that choice. So from a worker standpoint, I think there's a, still a lot that the industry needs to do industry meaning the freelance economy to enable people to express that choice because frankly, the freelance economy for most is terrifying, right? Not knowing how much you're going to make in the future having to go find the next opportunity. And how we think about it as at Paro is we'll be we're freeing experts and business professionals to leave the confines of traditional employment and go express their talents on their own terms. And that's really difficult to your point, Mitchell, which is it's a incredibly complex problem from worker preferences to enable that choice. Now having said that business professionals on average have, have experienced remote work and what it means to have some semblance of choice because of COVID and being able to work on their own terms wherever they want whenever they want. And so I think that the reversion back to the main, it's not necessarily going to occur, but we're more pushing towards that individual choice. Having said that companies and enterprises historically are slower to move up the change curve and adopt us just because they're large ships and steering, a large ship is very difficult to do. And however, if you think about the worker preference changes, if companies don't, adapt and change and think about flexibility and choice ingrained in their DNA and how they think about their cultures, then they're not going to have access to the worker population and pool that they had access to prior to COVID because those workers are going to also be in the freelance economy, working on their own terms, expressing their talents elsewhere. So it really is if enterprises and companies don't adapt, then they just won't have access to that talent. And I think that's something that's incredibly important to them.  Mitch: (12:22) I want to get your opinion on something. You know, I mentioned we did a lot of research into the future of work, you know, going on a couple of years ago now, and one of the theories or philosophies, whatever you want to call it, kind of what you were talking about here, as far as employee engagement and, and just their overall involvement with the company was kind of this 60, 30, 10 rule where, you know, employees, they dedicate, you know, 60% of their time or focus attention. However you want to break it up into their main hustle, right? Their main source of income, you know, they have to satisfy that need, but then employees also have other wants. They have other talents, I think is maybe what you're talking about here. And roughly 30% of the time, you know, they can express themselves with some kind of side hustle or something that gets, gives them more enjoyment. And then 10% goes to learning about themselves and about their skills and whatever the case may be. So, you know, like I said, this was something that popped up during research. Is that something that you're seeing as far as this freelance economy where people have different passions as well, or do you think it really is, is it income driven? Like w what is the need for this individual satisfaction as they go and search for this?  Michael: (13:36) That's a great point you bring up and it's a fantastic question. The reality is choice is very difficult to pin down and define, you know, we all want to like have a formula for what choice is, that's the ideal state. However, we're talking about individuals here, we're talking about people that are very different. There's no, there's no specific pattern because one, one person could want just to work on passion projects, to your point, one person could want to become a deep domain expert on one topic. That choice is really, really hard to empower and enable. And so to your point, I think part of it is providing the flexibility for people to choose what that route from a personal standpoint, and an individual standpoint could be so specifically thinking about the hierarchy of needs that I kind of outlined earlier. Part of it is nailing that down first, right at the foundational levels, it's income, stability, and predictability, in the middle it's career growth, income growth, community. And at the top, it's really like self-actualization realizing like their full potential. And, and, you know, for me, I use the analogy as to where I came from. So at Deloitte, it was self-actualization could be defined as you've made it to the partnership, right? It's whatever your individual goal is. However that wasn't my goal, but reaching the pinnacle and the peak, is an individual choice and defined by the business professional. And so the, the tools that you get there, I think the freelance economy provides more options than, traditional companies and enterprises and firms provide. because those, those employment structures, I came from big four, it was, you know, work two years, you get promoted to work for another two years, get promoted and yada, yada, yada, it's a very much the Deloitte way. Here's the fine pathway. Again, like that's fitting a round peg in a square hole. And, and so in the, in the freelance economy, part of it could be Mitchell, like, you know, you want a full-time job and then have a side hustle that's choice, you know, or it could be that you just want to freelance the entire time and, you know, spend more time at home with your kids, right. That's choice as well. And I think the freelance economy specifically enables more pathways towards that self-actualization.  Mitch: (16:03) So you keep going back to freedom of choice here, and I totally get where you're coming from. Like, I can relate to the ambiguity, flexibility, freedom that comes with it, but, you know, I want to take a step back and look at this from a business perspective, again, less other than individual or business people, all of our listeners here are accounting and finance professionals for the most part. So when you give employees this freedom of choice and you allow, I guess, or buy into this freelance economy, I'm sure one of the first questions that comes to mind for these listeners is what's the ROI, what are the benefits of this? So if you do get this, buy-in from organizations and the higher ups, the decision makers, and they allow for this to happen, you know, it becomes more popular. What kind of benefits can these organizations expect to reap from, like I said, buying into this and providing more choice, more freedoms.  Michael: (17:01) Yeah. So I think there are three things. It's one - speed, two - quality, and three - ultimately cost. The ROI on the cost part is a little bit more difficult to pin down. But if you think about companies, they have problems they're looking to solve. They may not have it well defined, but typically the historical way of approaching a problem is throwing a body at it, right? Let's hire more people and go solve this. However, in the future of work, I think it's very important for companies to define specifically, what are the problems they're trying to solve and what are the success metrics associated with those outcomes and giving more clarity and definition around that problem enables you to shape it into a project. And what I mean by that is the project sort of like, what I think about is like the project script, which also defines the success metrics and what you need to do to achieve that in doing that, you can very easily tap into an on-demand expert, actually not very easily. And that's where part of the problems exist today. But if you have that defined project and what it is, you're trying to solve what your problem is, then you can connect with an on-demand expert who can actually solve it. For example, let's say you've outgrown your existing ERP system and you want to, implement a new, more robust system. That's a problem, right? That you may face. So define it explicitly, lay out what your objectives and goals are, and then finding the right subject matter experts to go and do that. That talent may not be in-house that talent may not be within your network. That talent may be within the freelance economy on demand. And so our entire mission is to enable freelance or express that choice. And in doing so enable companies to tap into subject matter experts when and where they need them. And that ultimately leads back to the speed, quality, and cost components that I highlighted originally, because in the end, if we can democratize access to talent and opportunities, in doing so, we're empowering both the business professionals and the companies, to realize that ROI.  Mitch: (19:23) You know we've talked a lot here about the freelance economy and the future of work, and you obviously have great insight and, and, you know, are, you know, making great moves here and being adaptable and flexible and agile. So just, I want to give you an opportunity to close out the conversation here. Are there any other points or, you know, future predictions, whatever you want to call it, something that you see coming down the road for the future of finance?  Michael: (19:52) Well, I think it's three things that we kind of covered, you know, well first thank you all for your time and thank you, Mitchell for hosting. And I think to summarize, there are three key points that we covered. And the third one I'll expand on a little bit more. One is there's a, there's a mass change in worker preferences as it's evolving before our eyes. And now that business professionals have gotten a whiff of what working remotely looks like, because they're forced to do so, can't put that genie back in the bottle. So that's one number two is companies must, I think, rethink how work is done and adapt to worker preference changes so that they can access, the highest quality talent when and where they weren't. Right. And have, better outcomes, speedier outcomes at lower costs. So that's number two. And then three is the, I think there's this great unlock of business professionals that we, we didn't have a chance to truly unpack. I think we started to allude allude to it, but choice is a really difficult thing to nail down and specifically call out what is the pathway and deductive reasoning around accomplishing that. And I, you know, I brought it back to the business professional hierarchy of needs in the end. I think the future of work is one in which people are comfortable leaving full-time jobs and expressing their talents and their skills on their own terms. You know, I don't think we we've seen like, you know, those great resignation is what it's called right now. How are those people working in the future is a big question mark, I think 5, 10 years down the road, the number of skilled professionals, business professionals at firms at big companies within the finance and accounting industry is going to be significantly lower as I would say my, bigger projection, which I think we can unpack a little bit more if you want.  Mitch: (21:57) Yeah. I mean, I'd be happy to hear more if you'd like to share that, you know, how do you see that unfolding?  Michael: (22:05) So I'll just use my personal anecdotes and background. I mean, look like I was at Deloitte, and at the big four and you know, what I wanted to accomplish and the pathways of competition that were narrow. you know, I've used the analogy of, putting a round peg in a square hole multiple times here, but I think that was the case and leaving the, the big four and the safety net of income predictability, knowing what your future looks like, pathways to growth, that's all very well laid out and explicitly articulated, leaving that, especially for somebody who's conservative and risk averse and going out on your own or starting your own firm or freelancing or whatever it may be that that choice you're trying to pursue is frankly terrifying. Right? It's it couldn't be more scary, especially for, you know, a risk averse demographic. and so in this future of work that we're kind of talking about that choice is at the forefront. It is something that today is a gating mechanism in the future, I think is an opportunity. And specifically, if people feel like they have the safety net and comfortability to go pursue work on their own terms, however, that may be, then I think there will be a great shift away from full-time employment and more towards freelance, you know, fractional part-time on demand, whatever it may be. But that is the gating mechanism today. And I think part of what is holding back, finance, accounting, business professionals from pursuing work on their own terms.  Closing: (23:56) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Email:  heatherp@heatherpsolutions.comLinkedin:  https://www.linkedin.com/in/heatherpolivka/Design your hybrid/remote work experience:  https://www.heatherpsolutions.com/Train your new/first-time managers to lead hybrid and remote teams:  https://www.awesomepeopleleaders.com/FULL EPISODE TRANSCRIPTMitch: (00:05) Welcome back to Count Me In. Here with you again is your host Mitch Roshong and this is episode 153 of IMA's podcast series. In today's conversation. You'll hear about leadership needs that relate to hybrid or remote teams as you listen to my co-host Adam, speak with CEO advisor and speaker Heather Polivka. Heather founded Heather P solutions to work with progressive leaders of small and mid-sized businesses to accelerate revenue growth by creating work environments where people thrive. Keep listening to hear her discuss the evolution of business leadership styles and how to overcome the challenges associated with each.  Adam: (00:50) We're talking about remote work today, and it's been something, a topic that everybody's been talking about, especially with the commencing of COVID-19 and every that, how that shook the modern world as far as the work world and everything else. So we're going to focus really on a remote and hybrid work, as people are coming back to offices. And so let's start with this question. How is remote and or hybrid work benefiting teams or businesses now?  Heather: (01:17) There was a lot of benefits. I obviously, I think people know the benefits from an individual employee perspective in terms of flexibility, maybe saving on that commute. And you give some of the time back to the company and some of the time back to your, your personal life. But that also that, that benefits teams a lot, first of all, teams and business now have a broader access to talent. You're no longer stuck within your particular geography in terms of, you know, who has the skills or the experience that you're looking for. So it allows you to build the team with the skills and capabilities and experience needed to forward your business strategy. The other thing is retention of talent. You know, an employee moves away, goes to school for whatever reason gets married here, relocates, you don't have to actually lose that talent. You can keep them wherever they go. And I think that's particularly when I've worked for employers that really like to employ military veterans and their families. And so that is a whole host of talent that you get to retain even as they, as they move around. And there has been some productivity, at least maintenance and in many cases gains. And I think it's because the number of people are doing what I said at the beginning. I used to do this. Like if my commute time was an hour, I would give a half hour back to me for sleep or working out or whatever, and I'd give a half hour back to the company. and so that has helped with some productivity. And then the last thing I'd highlight is it's broken down some of the barriers between work and life. And I know that, millennials in that have not necessarily had those strict walls between work and their real life, but I know maybe for those of us a little bit older, we kind of had that separation going on. But when you've got kids hopping in the zooms and dogs barking in the background, it makes everyone more human. So while we've had less one-on-one interaction, it's also, I think, broken down some of those barriers that we used to maintain between work and life and a good way.  Adam: (03:27) It's almost like you can still be professional and then have a dog barking in the background and under, and everybody's been there and seen that, and it's no longer this taboo thing, you know, like that businessman who was talking on the phone in the news and his wife came in and the kid came in, his wife came in to just get the kid out and nowadays people are like, oh, there's your child. And they would just keep moving on, you know?  Heather: (03:48) Exactly, exactly. And I think that's, that's, I think that's healthy and that's really good. And I think it's particularly healthy for leaders to kind of shed a bit of that and make themselves a bit more human and vulnerable in the workplace.  Adam: (04:05) Speaking of leaders, how do you think they need to evolve their style to work with remote teams? And then, you know, on the other side of that, what types of leaders should companies be looking for in this type of environment?  Heather: (04:19) Yeah, that is such a great question. I think one that a lot of companies are struggling with, particularly I tend to work with more small and mid-sized businesses. And, but my background obviously is in fortune 100, many times, especially when you're talking executive leaders, regardless of the size of the organization, there is a way that we have all learned how to be successful. I pulled this lever, I do this thing and it creates those results, right? So we're now asking a whole host, a generation really of executive leaders to no longer really use the formula that they know, and that has been successful for them. And guess what, they're human and that scares them very much. And that's led to some of the defaults thinking of, we've got to get everyone back in the office and because that's the way they know how to lead. And so when we asked, like, what do we need from leaders to lead in this environment? You know, one is the old command and control model of leadership doesn't work well in hybrid and virtual work, right? Because even if you're in a hybrid work, you can see how people, when they're in the office are going to be doing more of the kinds of work that it involves interacting with other people. So a leader could walk through an area and just see a bunch of employees sort of sitting and talking in the lounge area, which quote, unquote, doesn't look like work. And yet that's the kind of work they're going to focus in on when they're in the office, because their intense focus, productivity work is the work that they can do at home. So that command and control of if you monitor and you manage employees that doesn't work well in hybrid or virtual work, instead leaders have to shift to managing the outcomes and the objectives and supporting people in whatever they need, whether it's what resources do you need, or what roadblocks do I need to break down? You know, what is it I can do as a leader to support you, to deliver on that outcome? And that's very, very different than managing people.  Adam: (06:34) For sure. So what are some of the challenges that come up when you're, when you're, when you, so let's say you've gotten that style, you're getting that style down. What are some of the challenges that you are going to start facing as you work with remote and hybrid teams?  Heather: (06:46) Yeah, there's, there's four buckets that I see most of the challenges come into and it has to do with communication, performance management, relationships and project or task management. Those are the four buckets and some kind of bleed over into, into one another, communication. What's interesting. And a couple of things with communication. The first is the thing we miss with remote work is that sort of fly by interaction or that incidental, you know, I used to catch people in the coffee line and go, oh my gosh, I was going to set up a meeting with you, but I'll just handle it right here in the coffee line. You don't get that necessarily when you're working with remote work. So it requires a little more either it requires more technology, it requires more intentionality. But there are ways to do it. You can, I've seen groups set up collaboration sessions where we're all going to log on and think about this problem and brainstorm. And it's just a, it's just a working kind of collaboration session. I've seen very successively used. What's called co-working sessions where you set up like a two hour block for whole team. And at the beginning, you kind of all say you're high in your creatings. Then after five minutes, everyone is heads down work, but you still got your zoom going on. And that way is you come up with a question or a yabba, or how about I can go out of this, this thing, do you know where that is? And you can give me that quick update and we can do that. And so we're still getting work done, but we're allowing for some of that more informal, quick touch base. And then another thing to kind of take us all back to our college days is the professor's office hours. The whole team could have office hours. It could be an hour a day, each day. And that's a time that, you know, you can informally grab anyone, you know, real quick on, you know, texts or phone or zoom or whatever, to get a question answered. So that's another way to bring more of that informal communication into remote and virtual virtual environments. So that, that would be, that'd be one I can dive into the other four, the other three, if you want Adam.  Adam: (09:03) Well, I mean, if you want to start addressing, you know, ways that they can help each of those challenges, you covered communication. Let's, you know, let's look at some of those other ones because I think it is a real problem, you know, unless I know that our company, you know, gave us all Teams, Microsoft Teams. So now we can chat with each other a lot easier because you do miss that, like, especially people who aren't necessarily in your department, people in your department, you're talking with more often, but somebody else, you may walk past their office and have that informal conversation that kind of getting to know, because you don't greet with them every day, but that's a little harder in a virtual environment.  Heather: (09:37) It really is. And that's where it does take, you know, some, it takes more intentionality there to make that happen. And I think Adam, that's an excellent point, especially for those groups outside of your team or department, but who, you know, you partner and you need each other. That's great, call-out. Performance management, we already talked on, it talked about it a little bit. I mean, first of all, most, most businesses are, we should be should quote unquote, be using smart goals, specific, measurable outcomes for, for people. And I think managing it by objective and then showing up as leader to say, what support do you need is really critical for being able to manage performance? And if you managed by your outcomes or your objectives, I mean, certainly in a performance review, that's an annual, so you have to break it down to what does a monthly or quarterly look like? What does a weekly look like depending upon what kind of team that you have, there's some way that you can measure your outcomes or your output. So then you can see where things aren't happening at the pace that they could or should or need to, and then start getting into root cause. so that's how you can approach performance management without having to keep your eyeballs on everybody, sitting at their desk for relationships. I, I think it's also about setting up time with each other where you don't talk about work. And I know that sounds a little, little crazy, but that's also that informal stuff that we miss, like when I was sharing about catching up with people in the coffee line, right. And it could be that it's a Friday morning virtual coffee, but you all agree, you're not talking about work instead. You're sharing what you're doing over the weekend, because that's also an opportunity to learn more about each other, like, oh, you're going to Comicon. I didn't know you're into that. Who's was your favorite, you know, that, that sort of stuff. I also like to encourage leaders particularly to log in early to meetings and, take those one or two minutes for chit chat to get to know employees and relate to them and find out what they're up to, what they're dealing with or questions before you, before everyone jobs jumps on the call. It has a great way to capture those little informal tidbits. And, and to your point, Adam, I would say that that's almost like critical to do when you're interacting with departments outside of your own, that you don't get to interact with as much. That would be a way to kind of capture a little bit of what you were pointing at.  Adam: (12:07) I've I found, I found that, I've had to reach out to people that I used to talk to when I was walking past their offices and like, Hey, let's have coffee, let's have virtual coffee and like we'll have tea or coffee in the afternoon and just catch up for a half hour. And that's just, a great way to connect with people.  Heather: (12:23) It is that's that intentionality, you know, we gotta be more thoughtful about it and about the, even recognizing the fact that we miss those interactions, you know, cause it wasn't like they were necessarily planned or on our calendars before. And then I think the other thing is when we were talking earlier about the zoom and the kid pops in and the dog pops in, I think there's a opportunity just, there's been more shared humanity and vulnerability during this time. And that's important to continue no matter where people are working. So I think there's something, again, particularly for leaders to share some of the more of those tidbits, like what were some of the mistakes you made? Like if you're talking about a major, let's say a tech implementation, you can use that moment to say, you know what, early in my career, I made a really big mistake. I didn't ask X, Y, Z questions. So I learned, and I'm not going to do that again. So what, what would be the answers to those questions here? So you're using an opportunity to actually forward the implementation call, right? Cause we're going to ask the three questions, you know, to ask, but you access it in a way that like shares something about yourself and makes a little more human and more approachable. It's amazing how those little pieces go a long way towards building trust, towards creating the kind of environment where people know like, oh, I I'm going to share too. And it doesn't mean the end of my career. And I can learn from you. Like you just, you just shared a mistake. So I'm going to write this down to make sure I don't make that same mistake. So it serves a lot of purposes, but it's just amazing how those little tidbits can go a long way towards building relationship.  Adam: (14:06) So as we've been talking about this, like remote hybrid stuff, it made me think of, there's gotta be these misconceptions that are hanging over all of this. You know, a lot of those misconceptions were broken down when everybody was forced into remote work. But as offices opened back up, a lot of places are just opening as hybrid. They're not going back to full-time cause I don't think people want to go back full-time into the office. And so what are some misconceptions that maybe we can break down for our audience?  Heather: (14:33) Yeah. Well I think the first one that I see in here a lot is that we all need to be together for our culture. That is a, that is a huge misconception. It's an understandable one though. And in that most workplaces that were in person before, how they work, how they make decisions, how they go about getting things done and share information, was all designed around an in-person experience. And just like if we design a desktop website experience and you go to your, your phone and it's not responsive and it's all kind of wonky, the information is still kind of data or, but it's not showing up in like the easiest way because it wasn't designed to be mobile. Well guess what? Most of our cultures and ways of working were not designed to be mobile. And that's why it has seemed wonky these last 18 months. But that does not mean, you know, your choices. You only use your desktop experience or you design a mobile friendly one and that's the same choice with culture. You can either review, you know, go back to the office if you're talented and your employees are willing to do that and stay with you. And in a sense, I would say, try to turn the clock back to 2019, not the path that I recommend, or you can design a mobile first experience that can also work when you're in person. And that's, that's, I think one of the mistakes too, not that you asked for mistakes, but with that misconception, one of the mistakes people are making is thinking that they can just go back, go to hybrid or stay virtual. And somehow it's going to become unwonky over time by itself. And it will, but that's sort of the painful way, like peeling the band-aid off one hair at a time. You know, you can do it. I'm not gonna, but there's, there's a less painful way to go about it. Or I will say it's more kind of ripping it off very quickly. And that is pausing and doing some intentional thought about what is summit, what are the ways that we have worked in the past? How have we shared information in the past and how do we redesign that for a hybrid or virtual experience? In fact, I just realized, Adam, I didn't share with you project and task management. Aha. My bad. Two things I love that I recommend: One is stealing from our agile tech world and doing daily standup meetings, the little 15 minute mini things that has everyone, like, what are your roadblocks? What are you going to do? Like easy peasy. But the other thing, and it's amazing how many teams don't have this is a single source of truth for what work is happening. Who's accountable for it. When is it due, but also like what decisions have been made? Why were those decisions made? What's some of the context, if that's not someplace that all team members can access, I mean, given some appropriate for all team members to access, then you miss some of that, that context. But that makes a huge difference when you're talking about designing a work experience where people might be hybrid, they might be virtual or they might be in office, is you think about having that single source of truth that you could get away with not having that when you were in person, you really can't get away within effectively and remote and hybrid work. So it's doing that work. And then the other thing I'd say about that is values. What does compassion look like in email? What does integrity look like on zoom calls? What does innovation look like with slack channels? And I, those sort of like, huh, I hadn't thought about it that way, but if businesses have defined their values and their behaviors that they want to perpetuate in their organization, they have to do what work to think about how those values show up in the channels and the ways that we're going to work in a remote and hybrid work. Cause that'll make it much easier. Like maybe it's okay to have short little messages and slack and you don't have to say good morning or hope you had a nice weekend and you say, we're not going to consider that root cause in this channel, you get to talk in shorthand. It's amazing how much little nuance and drama you could save by just saying that like, you don't have to do the little warm greetings. We're going to use this as a, you know, almost like text messages I'm running late, be there in five. Got it.  Adam: (19:03) It goes back to how important communication is and good communication with the whole organization. Because if you're not communicating people won't understand this new culture, all these different things you're trying to do. If, if you can't communicate that, then it just all kind of falls apart.  Heather: (19:22) Yeah, it really, it really does. And I would say the other, and I don't know that it's a misconception or even a mistake, but I think a struggle that we kind of pointed towards earlier and that we're going to ask a lot of leaders and especially executive leaders who their success and how they've produced, amazing results has not been in this way of working. And they just, as they've been asking your team members to demonstrate growth mindsets, you know, to continue to evolve and innovate the business well now it's time for leaders to demonstrate growth mindset and be willing to embrace a new way of leading. And I think as just as a human, we never want to look silly. We don't want to make mistakes. We don't want to do it wrong. And especially when you kind of feel like eyes are on you like, like executive leaders feel. And I just think it would alleviate a lot of pressure and expectation for everyone, for executive leaders to say, Hey, I've asked you to demonstrate growth mindset. Now I'm going to do that. I'm going to take on a new way of leading, cause I've not led in this environment before and guess what I'm not going to get it right. And we're not all going to get it right as we figure it out together. But what we ask is that we all have the same intention and outcome and we have a lot of grace for one another and then we'll, we'll make it through. I mean, cause if you think about it, that was a lot of the messaging at the start of the pandemic. There was a sort of, we're all in this together and we're all figuring it out. And that is the first time in decades that we've actually seen a marked increase in employee engagement was April, May, June, July of 2020. And it's because employees, they were communicated to which you just pointed to Adam, like there was a ton of communication going on. They felt their employers cared about them being safe, but there's a lot of messaging because it was the truth. Everyone was just figuring things out together. Like, I don't know, we haven't done this tech off site before, but we're going to try it in the next 24 hours. You know? And there's something about that as spree decor of that brings us all together that we'll figure it out and we can use that right now. We can use that to our benefit. And a lot of companies and leaders can use that to their benefit and it'll, it will, it will make everyone better and more cohesive as we move forward.  Closing: (21:41) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Nishant Nair: https://www.linkedin.com/in/ninair/Forbes Technology Council: https://profiles.forbes.com/members/tech/profile/Nishant-Nair-CEO-RecVue-Inc/329296c5-b50e-4cfc-a7dd-c6813580978dFintech Times article: https://thefintechtimes.com/recvue-dont-let-outdated-systems-become-your-legacy/Global FinTech Series interview: https://www.recvue.com/blog/qa-with-recvues-ceo/?utm_content=172261129&utm_medium=social&utm_source=linkedin&hss_channel=lcp-6640106FULL EPISODE TRANSCRIPTAdam: (00:05) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host, Adam Larson, and you're now listening to episode 152 of our series. The guest speaker for this series is Nishant Nair, CEO and founder of RecVue, a modern order lifecycle management solutions provider. In this episode, Nishant speaks with Mitch about the value of new financial systems over traditional legacy systems and the importance of streamlining your corporate structure to enable further innovation. Nishant believes businesses are walking when they should be running through today's business landscape of adaptable digital technology. So keep listening to hear more of what he has to say as we head to the conversation now.  Mitch: (00:54) Why is it important now more than ever for companies to implement new financial systems within their businesses?  Nishant: (01:01) Oh, that's a great question. Which, a simple way to explain this would be with an example that we are all too familiar with. Now, we don't go and get our movies from Blockbuster anymore. We have Netflix, we have Amazon, we have Hulu. Essentially we are in a digital economy and companies are changing the way they do business. They're not selling products anymore. They're converting the product into a service and selling services. So if you look at the financial and audit systems that were essentially designed for the Blockbuster world just does not meet the needs of the Netflix business model. I mean, they're just not designed for it. And it requires a completely new technology architecture and thought process.  Mitch: (01:53) Now with this new technology, these new thought processes, obviously there are a lot of opportunities. So for those businesses who are working on traditional legacy systems, what are some of the main issues that they are really coming across today?  Nishant: (02:11) Sure, sure. So the main, the main challenge, right, that we see with a traditional legacy system, it's its inflexibility, inability to scale and the need for an army of IT resources and business analysts to maintain it. Now compare that to modern cloud-based server-less platforms that lets companies be agile, right? Modern platforms built on cloud technologies make businesses nimbler and more flexible to meet the customer's need. I mean, if you look at, you know, these modern cloud platforms take away the whole operational aspects of running and managing huge software applications so that companies can now solely focus on growing the business, introducing new revenue models and making the customer successful, and then modern systems don't require an army of people to maintain it as well. So a lot of things that a, you know, a lot of challenges that we see with traditional legacy systems that, that, that we don't, or that can be avoided by transforming or with modern technology.  Mitch: (03:31) Now you've mentioned some of the challenges that businesses are facing. And again, the opportunities, the more streamlined new approaches that are available for listeners in business who are interested in taking action, right? What are some of the key actions? these business leaders can take within their organizations to accomplish a more streamlined, you know, simplified corporate structure, where the army is not needed, as you just said.  Nishant: (04:01) So it all starts with aligning your finance, your it, and revenue operations team towards a singular goal of transforming the organization and, setting the course to innovate and win in what we call a digital economy, right? And, that requires, fostering a culture that is receptive to change. That's going to be very important, right? To streamline operations. And even for these digital transformation projects to be successful, finally, it's the, it's the people that's going to make or break any transformation, like this.  Mitch: (04:48) And now you provided a great analogy, right? Going from say, Blockbuster to Amazon and the trends that are happening all across business. In general. I'm curious if you have recognized and seen other trends, you know, are there other things happening and obviously, particularly in finance financial services, what are some of the trends that are really exciting you and things that our listeners should be aware of? Maybe a little bit more interested in.  Nishant: (05:19) Yeah. From a, I mean, that is a lot of innovation. I mean, a lot of innovation that is currently happening in the financial services industry it's happening across, but specifically in the financial services industry, there is a lot of innovation that's happening that I'm really excited about. Right? I mean, if you look at, you know, if you, if you go back 10, 15, 20 years gone are the days when you had one or two large financial systems doing a mediocre job of all the different business processes. Now what I'm seeing is companies coming up using these modern cloud technologies and focusing on one particular business process and excelling it and being the best at it, right? I mean, if you look at, Cooper is a good example for procure to pay. And if you look at RecVue, which is for order to cash are prime examples of cloud technology being used to essentially improve or optimize a particular business process. And another area that I see is with cloud technology and API based architecture, it actually allows different systems to seamlessly talk to each other, and that's driving a lot of adoption as well. I mean, people, especially the next generation users are no longer compromising on any business process. They want a system that is the best for that particular business process. And today with the cloud technology and all the different integration platforms that are available, it is possible, right. And they want the best solution for each and every business process. And that is resulting in a lot of innovation in the financial services industry. It's a very exciting times with both, you know, technology and the business knowledge pretty much aligning with each other.  Mitch: (07:25) And what happens if businesses essentially don't take your advice, right? Everything we're talking about here, if a business chooses to continue using its legacy, the antiquated processes and systems, if they haven't gone digital, what are the risks? You know, what would you predict will happen to these businesses?  Nishant: (07:46) The world is changing. The world is changing. We all recognize that. I know the common example is obviously Blockbuster to Netflix, but what I see is that same change happening in each and every industry that we operate in that particular change. And, with the legacy systems, the most common phrase that I hear from businesses running legacy system is that they are there to keep the lights on. Right? And that's the most common phrase that I hear when we talk about legacy systems, what are you using your legacy systems for, or they are just there to keep the lights on now, companies can differentiate, accelerate the growth and own the digital economy by just keeping the lights on, you've got to change. Companies have realized it, that companies have to change. They've got to transform or essentially risk being obsolete. I mean, those are the, I believe the two to two choices that companies have in a digital economy where things are changing so rapidly, new revenue models are being introduced. More complex revenue models are being introduced every day. So you better have a system that can handle it, that's agile and scalable enough to take you into the next, you know, that can make you leaders in the next, I would say, in this economy.  Mitch: (09:22) Now, obviously the current state of, you know, the global business economy, we went through a lot right in the last year and a half or more with the pandemic and a lot of businesses. I'm sure a lot of those who were on these, you know, traditional systems, had to make major adjustments. They had to adapt very quickly and hopefully, you know, most did. And with that being said, assuming that, you know, anybody in business is aware of the possible consequences, as you just said, of becoming obsolete, what is your vision for business? You know, finance post pandemic, how do you see things potentially rebounding and, you know, what will this global business competition look like again?  Nishant: (10:10) Sure, sure. I mean, I think the pandemic, right. Pandemic, I mean, people talk about pandemic and it's true that what was going to happen in 10 or 20 years timeframe, the pandemic has definitely accelerated that whole process. Right. And then that whole process of cloud adoption, where we are looking at, we are no longer looking at a hundred percent going back to offices, everybody's talking about hybrid remote models, and working remotely. And that essentially brings in the need for modern collaborative platforms on, right. I mean, if you're running an old legacy, on-brand solution, that's no longer connected to the world. You're not going to be able to run your businesses anymore. Right. And it's not collaborative. And it doesn't scale plus it doesn't you know, it does not work, when most of your employees are global and working remotely, and that's a huge change. And I think that that's going to bring about an acceleration in the adoption of, cloud technologies and modern platforms, which we are actually seeing it today. We are seeing a huge demand post pandemic for modernizing legacy applications all across the financial services space.  Mitch: (11:45) So I just have one more question to wrap up our conversation today. And I think you've shared a lot of great insights on this topic. you were just talking about modernizing legacy systems and, and allowing for business to rebound and, you know, employees to collaborate teams to work together remotely. I'm just curious if you have any thoughts in regards to other possible innovations when it comes to modernizing these systems, you know, are there certain opportunities that you see that you think businesses might start to take advantage of as they begin to implement some of these either more modern systems or, you know, potentially new ideas?  Nishant: (12:32) Yeah. So, in terms of, in terms of new ideas, I think everybody all, I mean, like I said, the ecosystem for innovation is ripe at this point, right. And companies are innovating and obviously, right. There's a lot of talk around artificial intelligence and automation technologies like RPA. So I see those two areas, which is very interesting. That's essentially right. I mean, what you want to do is you want to do two things, right? You want to give people the information or the insights that they need at their fingertips. That's one, and you would want to automate any repeatable tasks, any tasks that can be, can be automated and that's repeatable, you would like to automate it that rather than a human actually going through that processing back. Right. And then those are the two areas that I see are ripe for, you know, for disruption now is mainly the areas of artificial intelligence where, you know, you can get more of a predictive capabilities in different areas. And, and even, you know, just like you have self-driving cars, we, in the next step one or two years, you're going to have self-driving. And then some of, some of the features that already come out where there's going to be a complete self driving financial systems, that's going to operate on its own. And it's going to require human intervention only when there is an exception, right? And that's the world that we are going towards. And that, that is one space that's pretty exciting.  Closing: (14:18) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Hema Vyas: https://www.linkedin.com/in/hemavyas/Hema's Website: https://www.hemavyas.com (Book a complimentary 20-minute Discovery call!)FULL EPISODE TRANSCRIPTMitch: (00:05) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host, Mitch Roshong and today I'm happy to introduce our guest speaker for episode 151, Hema Vyas. Hema is a renowned speaker on heart wisdom, human consciousness, spirituality, health, and energy. She works with individuals, corporates, startups, and diverse global audiences to provide needle turning solutions for problems of all kinds. In this episode, Hema speaks with Adam about the significance of heart, passion and emotion. When it comes to leadership and building high performance teams. Keep listening as we head over to their conversation now.  Adam: (00:52) Our initial discussions or, conversations back and forth. I was seeing you have this term omnipreneur, and I, you know, for many years there's been a celebration of the entrepreneurial spirit and business. And I was looking in like the definition of entrepreneur is a person who organizers or operates a business or businesses taking a greater risk than normal or financial risks. Cause they're usually going out there and starting their own business. So I'd like to take a step. So where is it? Where does Omnipreneurs fit into all that? And how does someone to get from an entrepreneur to an omnipreneur?  Hema: (01:26) I think an omnipreneur is what the world needs now. So, you know, we have lots of businesses. We have lots of entrepreneurs now, more than ever. We've got so many startups and people wanting to run their own business and run with their own ideas and taking the risk. As you said, you know, an entrepreneur who's willing to take risk and, and put the money behind themselves. And for me omnipreneurship is really about the next level where you align those sort of business skills. You align the financial and entrepreneurial skills together with health, wealth and meaning. So it's not just about, you know, in terms of running a successful business, it's about how we look after ourselves, how we look after other people, not just the people we employ, but also the people around us, the people, you know, when we're putting out products, how we're taking into consideration, you know, what's going to be for the benefit of the whole and also the planet. So for me, it's really a holistic approach to business, a holistic approach to life. And I believe that each of us should be omnipreneurs in our own way, where we are not only taking care of our own financial success, whether it's in a corporation or whether it's in as an entrepreneur doing, not running our own business, but also taking care of all aspects of our lives, making sure that we have time for relationships, family, making sure we have time to take care of ourselves and those around us and doing it in a way that is sustainable to the planet and the world that we live in.  Adam: (03:11) So it's taking all of the things that an entrepreneur would do, but adding in a holistic approach, it makes me think of terms like sustainability and those things are becoming more and more prevalent in business and being able to connect all those things in a holistic manner, which is not the easiest thing to do, especially when the bottom line is most important thing in any business, right? Because you have to make money to stay in business.  Hema: (03:39) Absolutely so, you know, one of the things that we teach is really how to be a tucked down business, where, you know, the people at the top are taking care of more than just the bottom line. They are taking care of people, making sure that they're fulfilling the sense of purpose that they have a sense of meaning. And they are also contributing to a sustainable business as well as a sustainable growth of business because you know, a lot of startups sort of growing exponentially and then don't have the means to take care of the people. Other dues. There's a huge turnover of staff because they're burning out and, and, and that's not healthy for anybody. It's not healthy for the people. It's not healthy for relationships, but it's also not healthy for business every few years. If they have to keep training new people or get new people involved in the vision and the goals you want people to grow in a healthy way. So really teaching the leaders how to lead in a way that takes care of, the people in such a way that the bottom line gets fed or can make do.  Adam: (04:49) That makes sense. I was reading that you say that you have to put your heart into it. So what's the role of like heart in leadership and in life, I guess, because we're trying to talk about the holistic approach.  Hema: (04:59) Yeah, absolutely. So a lot of the qualities that we teach I would say are qualities of the heart. So, you know, we have the cerebral intelligence, we have cognition, we have intellectual ability. We also have the gut intelligence, which is a body's intelligence, which is our instincts, you know, and that feeling, that knowingness that we get, which is more from an instinct place, that there's an instinct about something. And then there's heart intelligence, which I would say is more of a wisdom. And it's, you know, really tapping into that sense of wisdom that allows us to have that holistic approach. It is being able to come from our heart space to lead from our heart space, to make sure that we are being really heart-centered so that we have all the qualities, you know, that are heart centered sort of leader would have in order to be able to take care of the people in order to take of themselves. So heart has everything to do with business as far as I'm concerned, because that is where we get balanced. If we're not in balance, then whatever we're doing is not going to have the desired effect. So that's what causes extremism. And when we're too focused on one thing and not enough on another, eventually the way the universe works, that it creates his own balance. And that's what burnout is, is it, if you're not giving enough time to people to really, really take care of themselves and what's going to happen is they're going to burn out. So what you think is good, pushing people, for example, ultimately ends up not being good when we're centered in our hearts. We know what that balance is because each individual is different. So there's no sort of set of rules that says, well, you know, you have to stop people working at five. Some people might thrive working late into the evening. They might want to come in later in the day. You know, there's that flexibility that comes from not being so structured, not being, so process-oriented not being so cerebral, not being seen to lecture and not going well, this is what works, and this is how we have to do it. But actually looking at the people that you're working with, who you're working for, who's working for you and how to get the best out of that situation so that there is genuine expansion of the heart, which means that there's a, a sense of flow. And there's a sense of balance, which is really where real happiness lies, but also where prosperity lies. And if we want to be successful in business, I think we have to be successful and happy and heart centers qualities are those qualities that help us to really relate in that.  Adam: (07:48) Yeah. It's not something that you talk about often you don't, you don't pick up the Harvard business review and see, you know, things of the heart. but what you're saying makes a lot of sense where it's connecting to it's connecting to what really matters. Because if, if your employees don't understand, don't see that you care about them and that you hear them and listen to them, they will eventually get to that burnout place. If you're not helping them get there, is that what I'm am I following you right?  Hema: (08:16) Absolutely. Because, you know, we can't leave our personal lives out of it. So, you know, when you're going to work, you're carrying all of you to work. And yet there's this idea that when you go into work, you know, whoever you are, whether you're the boss, whether you're the employee, it doesn't matter that you have to leave aspects of yourself, but it all filters in. And if there's space to be seen for who you are to say, Hey, listen, you're having a tough day today. Why don't you take the time off, you know, going work out what you've got to work out and then come back in. I think you're going to get so much more from that employee. Then if you just do the same old, same old, you know, which is across the board, this is what applies to everybody. It doesn't necessarily anymore.  Adam: (09:05) So it sounds like, you know, things like truth and trust and transparency are very important in this model that we're discussing. Can you discuss more about what, what that looks like?  Hema: (09:15) Absolutely. Yeah. So the qualities of the heart that we focus on are sort of the ones that you just talked about for us. You know, it's really, really important to help people understand where heart energy and truth trust and transparency comes into that. So one of the things that I talk about is the electromagnetic field that the heart and veins the heart is always looking to put, right, whatever it considers or, you know, the wisdom of the heart could see yourself as being not really aligned with what is true. We know we feel and we connect, you know, with every sense that we have with what some, when something is truthful and our bodies respond when it's not truthful. And so the same idea that we live in a world where people are withholding information, not being transparent, you know, giving sort of information on a need to know basis. For example, it doesn't create a sense of trust. Now, when there isn't that sense of trust, I'll say instantaneously, you lose a connection with those people. If you're not inspiring trust in them, they are going to be disconnected from what you're doing. And if they're disconnected from what they're doing, they're not going to feel like they're on purpose. They're not going to be passionate about what they're doing, even if they started off loving what they were doing. And, and it's something they genuinely loved to do. That's why there's a crossover, you know, where they go to other companies or, you know, where you lose that sort of loyalty. Because often there is a lack of, you know, that transparency and it might be for genuine reasons. It might be, well, we don't need to bombard them too much information, but actually, you know, I think we have to get better skilled at really being able to identify when people do need information, whether it's useful for them to have it or not, because it's, you know, that lack of secrecy and that real transparency that I think makes people feel like they're part of something. And when we feel like we're a part of something, our hearts organically open up when our hearts are open, we're in flow. And when we're in flow, we have greater trust. Now we have greater sense of truth. And that feeling that there is something truthful here that's happening. I think, you know, increases productivity, increases creativity and increases loyalty. And I think that's really, really important.  Adam: (11:55) So how do you overcome it? Cause I heard you saying that transparency, that old mindset of you're on a need to know basis, but that's the traditional model and many businesses still hold to that. And even in an entrepreneurial space where you're a startup, there are certain secrets that you don't want getting out. How do you balance all of that? Because you want your people to feel like they're in a trusting environment, but there are certain things that are unable to be shared with everybody.  Hema: (12:25) Absolutely. I think it's less about sharing everything with everybody and more about intention. You know, it's, you know, the open door policy, when you say, Hey, listen, if you're struggling with something and I don't even care what it is, whether it's personal, whether it's social, whether it's about the business, whether it's about something that hasn't been communicated effectively to you come in and talk to you. We need those leaders who are really available and that are not going to make people feel small or insignificant for asking what they consider a silly question or, you know, wanting more information about something. Like I say, not everybody needs it, but just knowing that we can do it makes a difference just knowing we can walk into, you know, somebody's office and to say, Hey, listen that project something about it. Doesn't quite sit right with me and can you give me a bit more information so I can do my job well, and you've told me just get on and do this research, but I really like to know the context or whatever it might be. You know, when there is that ability to be able to go in and ask for what you need. And more importantly, the ability to actually be able to acknowledge to yourself, you're in a safe environment where you can acknowledge that you might need something more than what others have already got. Then it is going to create that sense of open expansiveness. And that level of trust is definitely going to be inspired in that situation. Lack a sense, not necessarily that everybody has to know it. They just have to move that if they need to know that there's someone they can ask and they'll be giving an honest answer that we can't share that with you because actually, you know, there's a big roll out and we're not ready to share it with anybody. But as soon as you know, we're able to share it with anybody, you're going to be one of the first people to know it's that sense of being, you know, sooth, that sense of being comforted. And that makes a huge amount of difference. And we live in a world where I say a lot of people have been numbed out to that and because they've numbed out to it, they don't even know that that's what's missing and they don't know how to ask for it. And leaders don't know how to give. And so that's one of the things I say so important to acknowledge, to change the way businesses are running to go from sort of more the entrepreneurial businesses to the more entrepreneurial businesses.  Adam: (15:02) So with the last two years or so since, COVID hit the world and affected all of us where most businesses moved to everybody working from home for a long time, and a lot of businesses are just getting started to bringing people back into the office. How can we take all the lessons we've learned from everybody working remotely to bringing them back into the office, to continuing to build a high performing team with all these things that we've been talking about today?  Hema: (15:31) I think the first thing is to acknowledge, you know, for some people it's been an absolute send home for other people, it's been an absolute nightmare and everything in between, you know, and to not treat everybody the same and to not think that they should or be the same and feel the same thing the same and to give people a voice. I think that's the most important thing we want to build sustainable businesses with the uncertainty that we're all faced with, you know, the uncertainty that hit us or, you know, like a rock sort of, you know, 18, 19 months ago, you know, if we really, really want to get the most out of that situation, I think we need more conversations. We need better communication. We need better communication that inspires, a set level of transparency, which will absolutely, you know, endear trust, because if you're going back and you have struggled, then you are going to want to be able to speak to somebody. And you're going to be able to be able to speak to people about, you know, what those struggles are and how to transition. And also the uncertainty that, that we might look down here. There are lots of people that are still very nervous about getting back, you know, on the commuter journey. There are people who are nervous about going back. There are those people who, you know, can't wait and they just really want to go back. And people who want to do the hybrid thing, they want to work from home a little bit, cause they definitely enjoyed it, but if they want to go and be able to, you know, come connect with other people and office and have meetings in person. So I think, you know, if the leaders are going to really bring them back and to keep them in a space where they feel safe, where they feel, they can really, really thrive and get on with their work, knowing that other things have been taken care of. Then I think that leaders definitely need to make more time to connect with people, individuals in groups, however, to it, to really, really, you know, appreciate the unique journey they won't be. And if we don't make time for them, as you said might be, they don't feel that they're being taken care of or that they are cared for that they matter as human beings, then I'll assume that, you know, they're not going to bring their best care to the situation. They're just not why should they, because if they don't exist in your eyes, why should you exist in there? You know, that's just human nature.  Adam: (18:08) So if you're looking at your employees and say, Hey, I see that you exist. Is that a step toward increasing things like innovation, creativity, creative thinking within the business because you're giving them a passion and a purpose in where in their daily work.  Hema: (18:25) Absolutely. Absolutely. One of the things that we sort of notice, you know, doing the work that I do is really the fact that, you know, if people have a voice, you'd be surprised who comes out with those jams, you'll be surprised who is creative, who might be really quiet, who might be really good at one job, but you know, has all these other insights or how, when one person opens up a conversation, you know, creativity begins to flow. Innovation begins to flow. And I think it's really, again comes back to communication, giving people a voice when people are seeing, when they felt heard they are going to speak up and you'll be surprised what treasures live within those people. And so just being able to give them a voice to just, you know, is going to give them that confidence to be able to speak up, which is good. And because, you know, sometimes when we're in a situation, we have blind spots, we all do. We all have blind spots in our own situation. And sometimes it takes somebody from the outside to look in and go, ah, this is what you need, you know, within an organization, when, no matter how big or small you don't know who might have the solution that you're looking for. And when you create an open sort of space and when you create a very trusting space where people can voice whatever it is, they want to voice. That's where creativity and ideas flow. And that's what leads to beautiful innovation. And so it's something that I think if people spend more time doing this, they are going to find that they are going to thrive. And we've certainly seen that our experience has been a real sense of, you know, the growth that comes when people individually grow. And when people really, really fall in the safe space then, because when safety is no longer an issue, when uncertainty feels like a safe space to be, then I think creativity prevails.  Adam: (20:30) What I'm hearing you say is that from a leadership perspective, there's a level of humility that needs to be there in order for you to be open enough, to hear what your employees have to say, because they may be saying something that you may not like or want to hear, and you may humanly react like, oh no, I don't like that. Or I don't want to hear that, but you have to be humble enough to take in what they're saying and take it as, okay, this is their concern. And I may not be able to do anything about it, but I have to be able to hear and listen, and actually be humble enough to be present for that. And that's not easy to do.  Hema: (21:08) Well, absolutely. And it's not because, you know, as leaders, you've got so many other things on your mind and there's so much going on. And so how do you make that time? That's one of the things that I definitely have teaching is how can we expand time? And we expand time by recognizing what is missed in those opportunities. When you think you don't have time to listen to somebody because taking that time to listen to somebody today is going to save you a hell of a lot of grief, you know, further down the line. And I think that's something that, you know, really great leaders do know and do recognize, and sort of the more newer leaders, they may be the ones who are struggling with it because they don't necessarily have the experience. And so it's recognizing that, you know, sometimes things aren't as we think they are or healthy, we think they should be. Sometimes we have to really lean into what's really needed in that moment and really come from that heart space to say, okay, I need to make time. Doesn't matter how busy I am. This is what I need to need time for, because, you know, again, I can honestly tell you that I know so many people have and are going to be leaving jobs, you know, September, because I've spoken to people, myself, my own clients who are like, you know, they haven't taken the time to really check in with us during all of this time. This is not company I want to stay with. And, you know, and I hear it across the board and, and I'm sure, you know, it's not unique to the few people I speak to. I'm sure a lot of people who are going through this now, if they're taking the time, let's say six months ago, even, you know, whenever to just touch base with everybody, you know, just really connect. Then they would be safe with themselves, the whole process of recruiting and all the rest of it that goes with losing staff. So it's so, so important.  Adam: (23:12) So I've mentioned already, like the, you know, how it takes a level of humility, but what role does things like emotion and intuition and even cognition, take in leadership, especially in, you know, in the realm of an omnipreneur.  Hema: (23:26) So I think for me, it's really about bringing balance to all of them because all of those things have such an important part to play. And in the past, we've sort of tried to keep emotion out of it. We tried to keep it very cooperative, we've tried to keep it very intellectual and the heart for me, you know the mind is where cognition happens. The gut is where our emotions happen. And the heart is where there is balance, where we balance both the instinct, as well as has seen too, where we balance those two things and get to a space and place of wisdom. And in leadership, I think, you know, you have to be like, it's not necessarily about your skills because sometimes the most skilled and the most, you know, expert, you know, people in their field don't make great leaders. And the reason why they don't make great leaders, is because, you know, they may be good at what they do, but they haven't found that balance of, you know, bringing the whole thing together and being able to have that bird's eye perspective, you know, when you step out of that situation and to really look down and really be able to say, okay, what's going on? Not everybody's like me, not everybody thinks like me, not everyone feels like me. And so to really have that kind of ability to have that sort of 3d perspective and to look down and to go what's needed in this situation. And that's where the role of intuition really, really becomes prominent because it's not necessarily about what you've done in the past. It's not necessarily about where you're going in the future, but it's about in that moment, what is the right thing to do and what is really, really needed. And when we have that present, when, when this, when we have that ability to, we all have intuition, some people are just better at being able to connect to it and name it. And, and it's, there's, it's something that we can learn. And when we really, really learn and use our intuition, I think we bring together, you know, our cognition, we bring together emotions because emotions are important. You cannot leave them out of a space because they're part of what's happening in the moment they add context to what's happening in the moment. And when we act intuitively, I think we act wisely. And when we act wisely, it's not only good for us. It's good for the people around us, but it's also good for the business or whatever our goal is, whatever our vision is, it's good at that.  Adam: (26:12) So what I hear you saying is that to have a successful business business, you no longer need to have a bunch of mindless drones. We need to have fully aware self-aware emotional people who can give all of themselves to, to what they're doing.  Hema: (26:26) Absolutely. Absolutely. We are human beings holistically inclined, and therefore this idea that we've had to compartmentalize ourselves, hasn't served us. It's created an imbalance and now you're right. We don't need this mind restraints. We absolutely need people who are willing to bring all aspects of themselves to the space and feel safe to do so and recognize it is a positive skill rather than a negative.  Closing: (27:00) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Contact Mfon Akpan: https://www.linkedin.com/in/mfon-akpan-5702325/The Hitchhiker’s Guide to Virtual Reality: https://www.biographbook.com/bookstore/hitchhikers-guide-to-virtual-reality/TED Talk - "Incorporating virtual reality in the classroom": https://www.ted.com/talks/mfon_akpan_incorporating_virtual_reality_in_the_classroomFULL EPISODE TRANSCRIPTAdam: (00:00) We're so happy you decided to come back and listen to Count Me In's 150th episode. Welcome to today's conversation. I am your host, Adam Larson, and the speaker for this milestone episode is Mfon Akpan, assistant professor of accounting at Methodist University. Mfon has a passion for emerging technologies and as an expert in virtual reality technology. He researches new technologies and educational methods to offer students occurrent effective and relative teaching experience and his conversation with my co-host Mitch, Mfon talks about the value of social media and its accounting implications for accountants and finance professionals. Stay tuned now and thanks again for listening to another episode of our series.  Mitch: (00:51) Social media is not something that many, you know, accounting and finance people probably keep top of mind, but following, you know, initial conversation here, there are a lot of dots to connect between social media and accounting. So to kick off our conversation, can you please explain why is it important for our accounting and finance listeners to really understand the value of social media?  Mfon: (01:15) Well, I would say that, well, first of all, that's a great question, Mitchell, and I would say in one word data and another word funnels. So when we look at the outage of Facebook and Instagram, that just happened, there was a huge disruption in both of those areas, one data, so information, two funnels. So you have many businesses that use social media to drive traffic, not only to their websites, but also to their physical locations. And this was completely disrupted. So, so many of those, those individuals may say, well, my business doesn't rely on, social media is not that important. What, when it was gone, many, many business owners felt the impact of that. And I think it's important as accountants for us to understand number one, to advise clients on their situation, but also the environment as a whole. And we need to also understand where the environment is going. So, one thing, and we talked about this a bit before the interview was I found out that Facebook was down because I started getting text messages from, from companies and place idea of business with that said, "Hey, come to our website, Facebook is down, this is a chance for you to check out certain things". That's how I found out because I was getting text messages from it. So, you know, understanding how this can impact the flow of business, I think is very important. And I think the outage of Facebook for many business owners was a wake up call on its importance and also the importance of having some type of backup plan, which translates to a strategy on what to do if it's not working. And or if that platform that you are on for some reason is not as popular or as not as, effective.  Mitch: (03:32) Yeah, those are great points. And, you know, we, we talk about data, obviously, data technology, evolution across accounting and finance and, you know, social media, it kind of lives on all of that. So, you know, you don't, like I said, it may not be top of mind, but through our conversation and considering everything that happened with Facebook and Instagram and, you know, we're talking events of the start of October, but, you know, I think there are, are a lot of other points to connect with our listeners. And, you know, we also heavily rely on metrics right in different benchmarks and other data points specifically. So as far as that goes, what kind of social media metrics, really affect the accounting and finance team as these, you know, events trickle down?  Mfon: (04:18) Well, I think it goes back to, as far as social media, understanding that. So from a, I guess, putting at a very simple level, understanding the dashboards on the social media platforms that you're using, that's very important from the side of the accountant, because if you're going to advise your client, you need to have some type of understanding of it, what data is there and what may be relevant to your client. Your client needs to understand it cause needs to understand who's engaging with their content. And when we think about social media, it can be broken down into three areas. So you've got owned, you got paid and earned. And when you think about your, your own accounts, so what you're posting, if it's a Instagram, if it's a Facebook or if it's a Tik Tok understanding, okay, what I post who's looking at it, who's looking at it. What are their demographics? You know, are they moving? And you can also look to, to determine where the traffic is going. Are they coming into the store? If it's a physical location, are they going to the website? If they do go to the website, are they buying same thing. If they go into the physical location, they call that conversions. So understanding that, and really that, that movement of getting people from that social media to your website and location, that's, that's a funnel, what they call a funnel. So understanding that I think is important on both sides. So from the accountant side to the, to the, business owner side, the other thing is that what I tell people is, you know, many people are, are, overwhelmed. They said, well, this is a lot of stuff to learn. And I say, you know, you don't have to become an expert at it, but you should be knowledgeable, particularly if you're, if you're using it for your business, you're posting it. You may be missing out on opportunities by understanding that information. And particularly you need to be knowledgeable if you're doing what's called paid media, you're paying for advertising. You really need to understand, are you effectively using your, advertising dollars on that platform? But if it makes sense.  Mitch: (06:46) I think, you know, for accounting and finance, everybody's looking to, you know, make sense of the numbers, right. And quantify things. And obviously everything you're talking about certainly relates to that. And I think one of the best or most common, however you want to say it, metrics really is, you know, that ROI, what is the returns? So when we talk about that, what is the actual measurement, as far as social media impact, you know, what are some scenarios where understanding ROI is really most important for, you know, the business owner, the accounting function.  Mfon: (07:22) Yeah. It is very important because you want to make sure that it's specifically would that pay media portion. You want to make sure that it's, it's being effective. It's being effective. There's measures, not in the dollar sentence, they call volume and valence, but you want to make sure that, okay, if I'm spending a thousand dollars a month, what does that equal in conversions? What, what is the return for me on that as a business owner and as an accountant, you want to be able to understand if these, these campaigns, as they call them are being a few, if you're advising your customers or your clients to, use paid media, is it being effective? So you, one of the measures as the impressions and the, the overall engagement with whatever, posts, which could lead to further awareness, or again, the end goal is conversion. So, and there's schools of thought on this, the awareness is, is more of the long game where they said that awareness will eventually lead to conversions or sales, and then the conversions. So immediate traffic and then purchases, you know, that that's the shorter term of, of the area. So it's important to understand all of that and to have some sort of strategy, whether it is formal or informal, and to be able to, to recommend and make recommendations to your clients. Also looking at trends. So looking at seeing what works and what does it work. And the, a lot of this is tied into, you know, you, you have the marketing point where there's not a really, you're putting things out in the public public domain. So, you know, some things may work is a lot of trial and error, which may be daunting to some as well.  Mitch: (09:29) So as far as keeping track of all this, right, you know, there are a number of data points that you just discussed and a number of ways to go about really figuring out that return, I suppose. But as far as, you know, providing some kind of insight, what can be used to track these different metrics, you know, are there tools out there? How can our listeners who are interested in learning and doing more in this space, start to apply what it is that we're talking about today?  Mfon: (09:57) Sure. So I'll answer this from that. The answer is, yes, there are many tools and many of the tools that you may see there's different dashboards that will measure it. They, they, from, from my research and investigation, many of these tools, the vast majority are based on something called the Eisenberg EMV. The Eisenberg EMV, and they released what they call the social media index. So, and what this index is, is they put a dollar amount on the likes, the shares, the engagement from various social media platform comments. So from Twitter to Tik Tok to Facebook, to Instagram, they have a whole list. So then you're able to put a dollar amount on your engagement. Why is that important? Well, again, we talked about the ROI, but now you can start measuring the impact and effectiveness in a dollar amount. So you may have a spin, you know, you spend 12,000, 15,000 on paid ads. Now you can take a look at that engagement from the paid ads and put a number on it and say, well, okay, this is really the net of it. This is the return on that investment. What we've gotten back from it as well. Now, the power of that ties into what they call earned media, which is outside what you post and what people are, are, really talking about you putting a value on that. And that's something that I think is very interesting, which can tie into community impact initiatives and spending money in those areas. And then posting, and then getting an ROI on that earned media from those particular initiatives.  Mitch: (11:59) So that community impact that you were just discussing, I think will probably lead nicely into the last question I have for you here, because, you know, we talked a lot about business impact and putting dollars, right. Quantifying a lot of our activity and operations, but I'm sure there are parts of social media that businesses can't necessarily quantify or measure, right. So, and I guess if the answer to that is, yes, it's probably a two-fold response, right? There are certain things that the business can't measure, but can still be valuable, I suppose, kind of like what you were just talking about, but then, you know, maybe there are parts of social media that can't be measured and actually increases risk. I don't know. so, you know, are you able to share some insights into what other, you know, qualitative data points from social media businesses should be aware of?  Mfon: (12:50) Oh, that's very good. So comments, so it's hard to measure comment what people are, are writing. I mean, you can and you'd have to read through all of the comments and try to find all of them, which can be challenging, but to find out what people are saying about you, that's, that's the hard part to measure and they call that consumer sentiment. So it's hard to quantify that, but you can take a look at your analytics as far as your, likes and, and your shares and engagement and impressions. So your engagement on your particular posts. One thing I would say for, let's say a smaller business owner that may be spending maybe $500 to $12,000 in paid advertisements. So their, their budget monthly, maybe between that $500. And, you know, let's say $12,000 range is to think about taking some of that money. And this is something we can advise our clients to, to try taking some of that money and potentially giving some of their product away, giving some of their product away, give, give $200 of the product, $2,000 of their product. If it's, let's say a t-shirt company give 2000 t-shirts to a boys club and then post it and then take a look at the engagement that they receive. Now there's indexes like the Eisenberg EMV. If you're not able to afford that, you can compare and contrast, take a look at the engagement. So this is why it's important to understand that dashboard and your data analytics, because you can take a look at your engagement from your paid ads, from your earned media. So from what you've done, and this can be an incentive for you to do some type of community initiative, right? And, and it could also generate more sales. So it could be a win-win on that side. So there's different ways to, to look at it, but I think it's important to understand it. And, and again, it comes down to, well, there's many points, but I think the two primary are the data and the funnels. So the information that engagement, and then the funnels leading to sales and understanding that.  Closing: (15:25) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, 

Contact Kevin Au: https://www.linkedin.com/in/kevinwau/Bill.com: https://www.bill.com/FULL EPISODE TRANSCRIPTMitch: (00:05) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. We're happy to have you back for episode 149 of our series. This is Mitch Roshong, and I'll be your host getting you ready for today's conversation. In this episode, you will hear from Kevin Au - bill.com's head of product marketing, accountant, and wealth management. In a moment, you'll hear him talk about lessons learned in the accounting industry and what the profession can anticipate as far as roles changing and skills needed in the future. So without further ado, let's transition over to the conversation now.  Adam: (00:47) So Kevin, thank you so much for coming on the podcast today. We really appreciate you taking some time out of your busy schedule to be a part of count me in.  Kevin: (00:54) Great. Yeah. Thanks so much. Thanks for having me. I'm a big fan of podcasts, so great to be here.  Adam: (00:59) Thank you. So there has been a tremendous lessons learned, and changes across society and business over the past 18 months, we've all been affected by it. You and I were just chatting about it before we started recording. What have you seen in the accounting industry? And do you think those changes are here to stay?  Kevin: (01:16) Yeah. So what we say in the accounting industry as small to size business markets is that the innovation and the adoption it's been accelerated about three to five years. And while every industry has been disrupted by digital transformation as a result of pandemic and working from home, right? This industry in particular has been ripe for disruption like for years. We've been just saying that over 90% of SMBs rely still on paper-based processes and checks, and that realization will be over-reliance on outdated labor and manual intensive ways to do business. As you know, bill.com works closely with the accounting community work with 85 of the top 100 firms plus 5,000 firms in total. And I remember I was talking with a couple of accounting partners and one partner in particular. I heard a horror story, literally during the pandemic, they had to use Uber and Lyft to transport documents between houses to get them signed. And they even use bike messengers. Like, I mean, this isn't sustainable, whether it's pre pandemic or post, and we believe that this community deserves innovation and we're here to deliver it.  Adam: (02:24) So when I hear innovation, I think of keywords like automation and AI, the, the buzzwords that we're hearing all around, and these are powerful tools that accountants need to have in their toolkit. Can you tell us a little bit about what bill.com harnesses, in your solution?  Kevin: (02:39) Yeah. So as, as part of the industry deception that we talked about earlier, you know, we believe that digital tools that all, that all three help our customers and partners to see it's really important, right? And automated those back office tasks and day-to-day activities. It gives our campuses actually more time and focus on areas of interests and right. So like inviting automation into the office, ultimately it just provides the accounting professionals just more time take control of their careers and just have more of a better work-life balance. As an example, you know, one of bill.com's customers is a wealth management firm and they mentioned that when they use bill.com, they experience a say percent time savings by streamlining all their accounts payable processes, but just then allows them to do something more that matters to them around financial planning and then managing their clients assets. An example for us on our platform, we do use artificial intelligence and we have a tool that we named, IVA, which stands for intelligent virtual assistant. And what IVA is, is a feature that just uses advanced technologies like machine learning that helps us extract invoices and vendor information from documents in our inbox. So that helps you actually create vendors and bills faster. So it takes information like the invoice number, like the, the amount you have to pay the due date, the amount. And it makes us so simple, like just literally imagine if you had a camera and he took a snap shot of your invoice and it gets automatically loaded in and IVA can read it and put all that data very easily for you to just help you get paid, to get paid faster. And that's, what's really exciting about, you know, automation and AI space.  Adam: (04:15) That is very exciting. Cause it, it allows you, it takes time away from the menial tasks, sometimes those tasks that take up more of your time and allows you to do other things right?  Kevin: (04:25) Exactly. Exactly. It's always about like the stuff that, you know, what would you be doing on a Friday night? Would you rather be doing all the manual checks and everything, or would you be going out having dinner with your family? And what we do is like with our technology and systems, it allows you to do the latter.  Adam: (04:39) So it sounds like the accountant's role is expanding and has been expanding, especially during the pandemic, you know, maybe they're saying, "Hey IVA, print me out my invoice". I don't, I doubt it's voice activated, but you've talked about a new Renaissance of the adversary accountant. What does that look like?  Kevin: (04:56) Yes. So even before the COVID pandemic, we saw, we heard businesses had a clear, and active need for advisory services. During the pandemic they became the go-to person, when they're helping clients through their PDP loans, through changing regulations and so much more. And they were the lifeline, they're literally the heroes, I think for a lot of the SMBs offering their clients the best, the latest information and advice actually keep them afloat. Like it was a really tough time. And we heard like accountants were just working endlessly nights and weekends to make sure, like they have to figure out how to do the PPP loans. Right. And that was a big thing that they did and their SMBs where their clients were also thankful for that. So now, as we're kind of getting out of the pandemic, right, accountants are just taking the opportunities to redesign their day-to-day jobs, especially by putting more time and focus through these advisory services. And they also offer things like client analysis and strategic counsel. And the goal here is not to add more hours to their already busy Workday, but instead it's about optimizing the work. And so for instance, you know, build a compromise, a lot of different tools, insights, and data, and we believe that data is going to be necessary to provide that efficient and essential path for that advisory services. How? It's that it can raise up all those data insights by unlocking that data in real time, in, in ways that they couldn't have done before. We're like in the past, this data will be trapped in some hidden spreadsheet or in a separate system that you can lock up. Now you have these systems and tools to bring this up to light and show it at the right time. And so we believe that the shift in like the bookkeeper's role is going to be actually more rewarding. It's also a really smart time for these firms in terms of growth and what we did like bill.com, in 2019, we had a fire hire index survey and we just asked them like what they're doing. And one of the things they said is like more than half of the S&P participants are actually looking for, accounting firms that offer a wide range of services around accounting tax and advisory services. And what we even said that there was about almost half that said that they would stop referring their accounting firms if they wouldn't offer strategic advice. So now strategic advice is almost the norm that a lot of these firms and these clients are looking for.  Adam: (07:12) So you mentioned the end of the pandemic, obviously we've got different variations of the virus happening. So there's, there's different things that are happening with the vaccines and all those things happening, but that brings in new challenges and new changes that are on the horizon. Companies going from completely remote to hybrid situations or even fully in the office. There's so many different things happening. So how can companies best prepare for a potentially unpredictable future?  Kevin: (07:39) Yeah, so I always learned the only constant in this world has changed. And as we always move into the future, changes is inevitable. And I believe that treating new technology and using automation, it's an opportunity as a key to imagine the future of accounting. And what we find is like, you know, finance and accounting leaders will need to be increasingly clear about any changes, that their company does in terms of processes or programs. And what this will do is it'll allow you to prepare for that shift and communicate any concerns before anything is set in stone, right? And as we know, speed, bumps are always going to be enough, right. And businesses should plan for it. For instance, having a buffer in their budgets for unexpected expenses, making sure that you have the right technology updates to happens, even have a plan for crisis management, that if, and when it happens. And lastly, I think one of the things I always think about when you want to prepare for changes, like stay on top of those trends. So kind of think you're joining accomplices and just reading what, you know, what are the things that are coming up so that you have a sense and have a little bit of a north star of what may be coming up in the not so distant future.  Adam: (08:48) So speaking of the future, let's put our, you know, let's look into our crystal ball, five to 10 years from now, you know, Kevin, when you're looking at an accountant, what makes a good accountant? Like what are the good skill sets and approaches that you anticipate will make that good accountant in the future?  Kevin: (09:03) Yeah, so accountants, I believe their role is morphing and in the not so distant future they'll be called upon to do more than just what I call the traditional bookkeeping, the debits and credits of bouncing box. And we've already seen these professionals step into these multifaceted roles, such as financial advisor, wealth manager, and even like a therapist as our world becomes more interconnected and just more complex. Right. And I believe the truly successful CPAs, will be able to balance the client relations and ad-lib consulting with the work that they've been traditionally been associate with. And part of that balancing that interpersonal and strictly I call them logistical aspects that we kind of lens will involve knowing when they could pass off the certain responsibilities and rely on technology and acknowledging the use of that automation taking advantage of the capabilities will differentiate the good accountants from the great.  Adam: (09:56) So to what extent do you think those roles and responsibilities will change by, like, let's say 2025.  Kevin: (10:03) Yeah. There's a lot. And, you know, considering what the pandemic that businesses have pivoted already so much and their policies and procedures in a matter of days and weeks, four years in 2025 is actually a long way. But I believe that the role is changing and for the accountants and bookkeepers, it's, it's going so fast from that traditional sense to more of the CFO advisory services. And our focus for us is to help them make this transition, providing the tool sets to make them successful, which is around data, the more automation leveraging AI to do it. And this also includes investing in employees with quality training, and also includes educational resource to help them ease into these new responsibilities so that when you do have to adopt new technology, it's not a big detractor reduction. I believe that upscaling will be a big priority in the coming years. What we did see, you know, the lights stay at the AI and the enterprise reports show that once automation solutions having to establish, you know, those good business leaders actually more sought after than those technology engineers. Why? Because they got to figure out what's the other technologies built up. They've got to have some person with a business sense, to make sense of all the, all the data and then actually figure out what you want to do in terms of the business going forward. And as more and more firms transition to digital, we expect the accountants. They can actually additional responsibilities for managing clients and offering strategic advice. I think, you know, most important about this role by having all the technologies use the accountant's role is actually it can be driven by more what they want to do as opposed to what they have to. And it's because those increase automations will just allow them more time to pursue more of their professional interests.  Adam: (11:49) So what do you think the accountants are focused on now? You know, as we look at the next, you know, two to four or five years, what should accountants be looking at? Or what should they be focusing on? You know, you said what they're interested in, but they also need to worry about, Hey, what does my job require me as well? So how do you find that balance?  Kevin: (12:08) Yeah. So there's the so many things I think of that, the jobs morphing. So if I were like, say like, if you're a new accountants and here's the five skills that you want to have, here's where I think: number one, because of what we're saying about the advisory, I think number one skills that you want to have around the strategic client, right? We're just seeing just more accountants, just doubling the hat. You can be the countless, but you're the advisor, you're the therapist. So you having the ability to think through strategically what clients are looking for. I'm thinking a little bit ahead is going to really help. Number two, technology's our friend. And so as an accountant, yes, you not, you're not that technology savvy, but you will have to be able to manage technology and be technology forward thinking. All right. The fact is, you know, using the technology as part of like one of your arsenal and your toolkits will really help and having accountants who will become the experts in managing and retaining these programs. It's kind of really be helpful. Third one, as I mentioned, it's about the customer relationships. You know, I count this is not simply just doing the books and going away, or you gotta be able to work closely with clients, address their, their questions and answers. And you have to build that relationship over time and just be able to adapt and really listen to what they really want and then figure out what you want for them. Fourth one is creative thinking, know our world is so complex and the standard way of what we did even a decade ago is much harder now. And so what we see in a lot of accountants is that they had the pandemic was this one of the situations where they had to do something that's totally different for what they ever had done before. And they had to think about creative solutions that could meet the needs of every single one of their clients. And so the accountants to be successful is going to have, be able to think outside the box and outside the books, it's going to become the norm. And then lastly, I think the last skill I think for accountants to be successful is finding that work-life balance, right? That pandemic collapse, all the boundaries about work and home life, right? We're still all working from home. And as we emerge from COVID-19, I know both employees and employers are advocating for practices that promote just better mental health and permit that flexibility. And so automation and AI simultaneously putting that time back on the accountant's calendar. So there'll be able to take more time for themselves without sacrificing their career aspirations.  Closing: (14:30) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Gregory Kogan: https://www.linkedin.com/in/gregory-kogan-083bb07/Self-Service Data Analytics and Governance for Managers (book): https://www.amazon.com/Self-Service-Data-Analytics-Governance-Managers/dp/1119773296FULL EPISODE TRANSCRIPTAdam: (00:05) Welcome back to episode 148 of Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host Adam Larson, and I'm pleased to kick off today's episode by introducing you to Gregory Kogan. Gregory is professor of practice and accounting at Long Island University, focusing on teaching undergraduate and graduate courses in accounting and finance. He is also currently pursuing his doctorate in business administration at the university of Scranton with the research focus of data analytics and accounting. So in our upcoming episode, you will hear Greg discuss self-service analytics. Keep listening as we head over to the conversation now.  Mitch: (00:49) In the field of finance and accounting, there's been a lot of talk about data and analytics. And, I know in your space you have a lot of experience. I'm just curious from your perspective, what is really driving the accelerated pace of analytics and the overall adoption at these larger enterprises?  Greg: (01:09) Yeah, so I think the biggest thing, and if we're talking about the finance function, it's really the, realization of ROI (return on investment), where companies can use these new techniques, analytics, automation to accelerate their processing, right? So in finance accounting, for years, we've been doing things manually and repetitively. And now with these new tools and these technologies, a lot of companies are adopting these tools to accelerate processing, reduced processing time, reduce hours, accelerate processes, and there are benefits like it's more accurate, there's more control, better internal control. And those are really big benefits on top of the financial benefits. So there's sort of a convergence, I think that, companies are just taking advantage of this, the, to have more smooth and streamlined processing. That's more efficient.  Mitch: (02:08) Now I know something that you focus on or, you know, you'd like to share a little bit more here are these, self service tools, right. And, you know, just for our listeners, what are some of the defining characteristics of this subset and how does it work into analytics? And, you know, when it comes to again, advancing some of these opportunities, I guess you could say, why do these tools lead to more of a decentralized pattern for your reference?  Greg: (02:36) Right? So the tools, yeah. So the tools we're talking about, you know, and coming out, you know, very much out of the what's happening in public accounting and what's happening in the finance function in terms of, financial and managerial accounting. We're really talking about Tableau and Alteryx, which are off the shelf tools. And even in higher education, we have a lot of these now in the classroom. So this is a still pretty, fairly new, but very much highly used. And we call themselves service tools because, it's not something you develop, what you end up developing is a specific process within that tool. So for example, an Alteryx, you can create a little process that say does a reconciliation or a certain reporting. And it's something that used to live in Excel. That's really now living in this tool and we call it self service. It's in that bucket of you can really do it yourself, much. Like you do Excel yourself. You could really, as a finance professional, since it's low code or really no code you pick up the tool you put in your data, which you really, you already have access to. That's really something you work with on a day to day, and you can set up these, we call them analytics, assisted automations for Alteryx and in Tableau it's really dashboards and visualizations. So it depends what part of it you're working with. But yeah.  Mitch: (04:04) That's very helpful. And I know, you know, in our space management accounts, specifically, a lot of that, you know, internal focused and we're really into, you know, the storytelling behind it and the tools that you referenced literally enable, you know, our, our listeners, our finance and accounting professionals to present this data in a way that's easily easy to understand for everybody, right. I think that's really the goal, but, you know, taking it even a step further here, try to, you know, set the stage for us a little bit. What are some of the primary motivations? And, you know, there is some kind of investment or, you know, even if it's just a learning curve in order to adopt these tools, what are the end goals, but what can our listeners expect if they're able to implement these strategies?  Greg: (04:48) Right. So what you can, what are the, some of the benefits, essentially, after some investment, what you can end up doing is something that you do on a recurring basis, manually in Excel, right? And, and we had this also, as a case study in the book that we're kind of referencing here, the self-service data analytics and governance for managers, but this is something that I've been doing as a case study with students and in the MBA. And what happens is we basically have like five years of data of balance sheet and income statement data. And, and we do this in Excel where we compute all the financial ratios, profit margin, asset turnover, return, and equity. And we do like the DuPont model, basically for all the companies in the S&P 500. So for example, what we did as a case study in the book, we put it in the Alteryx and then we set it up as like little steps, rather than Excel. It's sort of all in one big place and you could still see everything. And we do pivot tables and graphs. It's still a very, very good, but once we set it up in Alteryx, we're able to filter the data by industry. So all of a sudden we started looking just at information technology. We started looking at graphs for each company of all the ratios, and then we started looking at specific companies a little bit further down the line to see, oh, wait, we just keep looking for the best one. What is the best industry? What is the best company? And then for that company, we have four dashboards for each of the ratios over five years. And after we set that up, we thought, wow, if this was like, say this was in management accounting, and I was doing my own internal reports, it could still be profit margin by region or geography. I could really sit with that and just flip my filter from Europe to north America and see my ratios, you know, and then we were thinking about it for me to do it in Excel every month. And it's something I used to do as an accountant. I just imagine it's a lot of work, get the new data uploaded, reconcile it. And that's something that takes us a couple of dates and just the flip, the switch. And Alteryx where you just upload the new data. And it does it for you. That's what we sort of started imagining. And of course we have seen the benefits. We've talked to people who've seen the benefits, but just to feel it yourself, like that amount of work going down from three days to like 30 minutes is exciting. And I don't know, I don't think you lose anything in the process. In fact, it is still stable. It is controllable and it's more flexible because the, all the charts are, you still see them, you know, and you just, you do it yourself. It's not something you have to call an IT person too. So I think it can even feel very empowering that it's still your it's within your role and your routine. You just do it in a different way.  Speaker 2: (07:36) Just a quick follow-up on this, part of our conversation here, you just mentioned, you don't need it for this. It is your responsibility, essentially, as you know, within the finance function, but what is the learning curve? You know, what, what goes into actually being able to upload this data and, you know, work with it to a point where you're comfortable, you know, first of all, you have to trust it, right? You have to trust that everything's working because you're not the one who's actually doing it. I think that's a big thing with accountants, right? They're used to, as you said, reconciling everything and they know that it's right, but you know, the trust factor, but then the learning curve and just being able to do it all from your experience, what does that look like?  Greg: (08:14) Okay. So, the learning curve is basically, and this is something that I went through a couple of years ago is something that, it can take a couple of weeks essentially to get ramped up. And, you know, Alteryx itself has a bunch of videos on their website and a, and a guide on each one of the processes. And they give you, I believe the license. And also the licenses are very affordable or free, depending on the situation, whether you're a student or affiliated with an organization, or it might even be available within your organization. And I would say, yeah, it's a couple of weeks that are kind of playing around with the process. Following the videos, the training itself can take a couple of weeks to get set up with these, and then the setup itself, or the specific process can be a couple of hours or a little bit more. So it's not, it's not as intensive as you would think, oh, wow. I have to take a year to go study this stuff. No, it's a couple of weeks of, I would say, an hour or two a day to get caught up and then a little bit more to play around with it. And the only thing I would recommend is speaking to the other people who are using these tools and kind of try to connect whether it's online or through these podcasts, or, I know that IMA has several courses that I've taken on RPA. I'm sure now there's other ones in data analytics. So actually I've taken a couple of IMA courses on data analytics and RPA, but those are very helpful. And if you, in fact, if you start with one of those that I think that one was four hours and you build your own study and you connect it with speaking to some people. Yeah. There's really no standard way. I think because it is a little bit of a new space, but I think organizations like yours really help out because in a way I would compare it much easier than say going out and studying for the CPA. I mean, we're talking about really like a 10th or one point of the effort. So I would think, you know, start with those smaller courses and build up from there.  Greg: (10:17) That's that's perfect. And thank you for sharing that your personal experiences, you know, I think that helps our, our listeners really understand, you know, all this sounds great, but having an idea of what goes into it, you know, it makes it a little bit more, you know, feasible, I think, in their minds. So, that's great. I appreciate it. And, you know, taking this a step further now, talking about analytics and the different things you can do with data, if you've taken a couple of the IMA courses, you know, one of the things that we've put at the foundation of all of our data and analytics conversations is governance, right? And I think that's something that, you know, you might be able to automate some of these processes, but the governance needs to be in place. So what in your, you know, your voice, what is the importance of data governance and what goes into the, the requirements, you know, your recommended procedures, policies, whatever it may be.  Greg: (11:11) Yeah, yeah, absolutely. Yeah, we speak extensively about governance and, you know, I think data governance is a huge field of study, right? And, and, and it, you know, and it ends up probably the best way to enter it. And I think data governance in this context really focuses on the input level because when you, when you work with the self-service analytics tools that are very much accessible to management accountants, the biggest, most encompassing issue is on the input side, right? Much like with any Excel spreadsheet and picking the same principles, you have to make sure that those inputs are correct. That there's integrity, that there's a sort of a custody chain of data as it moves from different places, whether it's in the ERP system or a cloud to the Excel, to the Alteryx out of Alteryx to somewhere, back to the ERP. So that custody chain has to be maintained and made sure that every link is properly has proper security and integrity, privacy, accuracy, and then the extra step. So all that I think is already well-known in a way in the data governance was just like a whole field of study. And I know you focus that you focus at a time a very much, and then the additional pieces that we discussed that are specific to self-service analytics are things within the tool. So once you get in the pool and say, Alteryx, yeah, it sounds the one I described does sound kind of like simple and exciting, but I've seen some that have like 50 processing steps and they're looking for fraud. And now they're using advanced text analytics, the mine, a whole email database. So it gets more advanced. The capabilities are there and people are using them. So what we recommend is also that additional layer of each step within Alteryx has to be verified, has to be assured and has to be tested, you know, make sure what you put in is what you're expecting to get out. Make sure it doesn't seem like a black box where you don't know what's happening inside and making sure that the auditability of it is there, you know, whether it's for management, accounting, and that's going to management, or it might be a number that ends up somewhere in a report, that's going somewhere else. So there's a risk assessment part to it that we discussed where we say, Hey, we were going to build these, analytics assisted automations. We're also going to make sure that we're aware that there could be some risks and we should be auditing some of that risk and we should be monitoring the performance of those builds.  Mitch: (13:51) So just real quick on that topic. Cause I did have a follow up on that as far as risk goes. Again, some people who are new to this and may not have the governance procedures in place and, or, you know, any kind of internal control, maybe over, you know, like you said, the custody chain there, if you don't take the time and put in the effort in order to ensure that, you know, all of these policies are in place, what could the risks be? You know, sometimes you want to give them a picture of down at the end of the road. If you don't do all this, this is what could happen. So why is governance so important? What are you really hopefully preventing?  Greg: (14:31) Right. So what's going, what happens with these? And this is on one level, there's that traditional risk that we know from accounting where, you know, number's wrong and ends up on a report there's liability, there's risk, there's reputational risks. There's financial risk. Yes. That's all there. And we probably are aware of that already, but the additional piece here, is that, you know, if you go back before all of this, all of our digital processing was inside of some kind of ERP system that centralized ERP system already was designed with the controls in mind, authorizations, reconciliations, different checks, segregation of duties, and all the users were funneled into those control funnels. If you think about it, now we have people sitting there doing Tableau, doing old tricks on their desktop, you know, getting their data from wherever and inputting it in. So that's sort of what we call data. democratization where now users are using the data to do their own processing. So they're not being funneled into the central ERP system that has all the control architecture. So we need those additional controls. And one of the things that can happen is just total chaos, where everybody's doing their own processing and they're doing their own reporting and say, you're like a higher level control manager at NuCalm, and you say, how do I know any of this is right? It's not, where's the segregation duties where where's the reconciliation where are my additional system checks, that's all happening on those decentralized basis now. So without governance, it could be a situation where you actually can't really rely on any of those outputs anymore. So that's sort of a, trying to get it in advance of that. As it gets adopted, the governance can really, can really help. And the other thing we recommend, and I think you mentioned that it's also lack of governance has been known to be the number one issue in scaling the analytics. So people say, oh, all of a sudden, oh, I can't do this. Oh, this is too much. And it's partly because there's no governance and scaling analytics can be a huge digital transformation goal. So we sort of say, Hey, we want to scale digital transformation analytics. That is sort of something that's actually going to help you do that. Otherwise it's, it's really, it's kind of a steep slope without it.  Mitch: (16:57) That's perfect. That's exactly what I was looking for. And, you know, like I said, sometimes you just paint that picture upfront and give everybody the heads up, but this all sounds great. And listen, I know you briefly mentioned the book. I want to give you an opportunity to talk a little bit more about it here, as we wrap up our conversation, because it's all very valuable information. So how is all of this really presented in the book? And again, plug the name for us one more time and give us a little bit of the background story to it. Why's it all relevant? And then, you know, what kind of information or, takeaways can our readers and listeners expect from some of the work that you.  Greg: (17:33) Absolutely. Yeah. So the book is by myself and Nathan Meyers, and it's called Self-Service Data Analytics, Governance for Managers, and essentially what we do, it's sort of a two-step process where we first discuss all this analytics and service self-service analytics. And we discuss it in a way that is very accessible to accountants because we're both CPAs with an accounting background. And, Nathan has been leading these digital transformations in the corporate world, and I've been embedding analytics into accounting classes in higher education. And we sort of looking at from a perspective of making it really accessible, making it really understandable and making it really kind of down to earth. And that's the first couple of chapters where we define all of these technologies and we make the argument that where we are, where we are today in accounting is where aside from, for example, artificial intelligence and RPA, which are tremendous topics in this world, we kind of make the argument that look this world of Tableau and Alteryx is something that is really happening. And we kind of make the argument that it's something that may grow quite a bit. And I, and I have seen it growing since we started, in the past year and we'll see what happens next year, but it seems like a lot of organizations that are really using it. So, and then we go and say, we say, well, there's an issue with controls if you're doing everything in Alteryx and Tableau, because it is decentralized. And we actually propose a whole governance framework for users. And it's, it's mainly around project governance where you kind of make sure that each of these projects has proper assurance capabilities and, development standards and it's properly documented and has the proper data governance and in risk governance talks about how each one of these can be risk assessed according to unique risk dimensions, and basically treat them as a portfolio and have a whole portfolio of these builds and risk assess each, and then monitor them, monitor them, report risks, report exceptions, create risk transparency. And basically the goal is to create trust and the outputs. And now we live in the world where there's so much emphasis on, in a way mistrust with technology. And then there's also a ton of emphasis by accountants. I think we're leading the way in creating trust around that, but then that's really the goal. Each chapter includes like a, basically a checklist of governance precepts, for project risk. And then we also talk about investments. So make sure that your dollars are going through the right opportunities, make sure you are prioritizing the best processes and it's sort of to help grow your ROI. And we call that investment governance.  Mitch: (20:31) So again, before I wrap this up, we may have to bring you back and talk strictly about this governance framework. I think that's something that our listeners would really be interested in, but in the meantime, you know, before we get that reporting done, where can the listeners find this book? How can they get their hands on it?  Greg: (20:50) Absolutely. So the book is on Amazon, you get it through Amazon or through Wiley directly. And, and essentially as self service, if you go self service, data analytics, governance for managers, it comes up. Usually it's Amazon is the way to go these days, but, Wiley has a very nice thing. And the other thing I'll say is that if you are a student or part of a university, I know it's widely available in, in all the university libraries. If you just go, if you just search it in the library search box as well.  Speaker 4: (21:24) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Jason Whitley: https://www.linkedin.com/in/jason-whitley-18919711/FULL EPISODE TRANSCRIPTMitch: (00:05) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong, and today's episode is number 147 in our series. The featured guest speaker in today's conversation is Jason Whitley. Jason is the chief financial officer at Phi Inc. And he comes to count me in to share some of the knowledge he's gathered from his over 30 years of global industry experience. While talking with my cohost, Adam, Jason addresses how the CFO can become an effective business partner and emphasizes the various skills one should develop along the way. To hear more about what an aspiring CFO needs to do to contribute to sustainable organizational success, keep listening as we transition into the conversation now.   Adam: (00:57) CFOs are now being looked to for governance, risk management, business change, business resilience, technology advancement, and the list goes on from there. Are the inherited skills, finance and accounting professionals possess sufficient enough to make decisions? And if not, what are some of the crucial skills they need to evolve?   Jason: (01:16) Yeah, no, that's a, that's a great question. I would say that the, you know, the CFO role has really transformed pretty rapidly over the last several years and it's become, you know, one of the most difficult jobs in the organization to do really well because of the broad scope that you just mentioned. I know that, you know, myself, me and my colleagues who aspired to the role over the years, but it's really a job that's almost impossible to fully prepare for and I don't think the skills are easily inherited. You're expected many times to have a depth of knowledge in several different areas. The ones you mentioned, including, you know, treasury, accounting, risk management tax, IT, controls. And then on top of all that you need to really have a good in-depth knowledge of the business operations. If you want to be an effective business partner. And it probably even left out a few areas, but the point is that it's, it's really extensive. It's difficult obviously to have depth of knowledge in all of those areas. So inevitably you're going to enter the job with some, some skill gaps. And I've seen this in my role. I've seen it observed in probably every CFO that I've interacted with in my career. And I think the key is really to surround yourself with a team of folks that are they're technical experts in these areas and ensure your weaknesses are really covered by their strengths. I think it's also important to develop a strong network. I need a network of mentors and a network of you know, technology and technical aspects for service providers that you can really draw on to supplement your knowledge and some of the skill gaps that you have, or just to bounce ideas off, as the time comes and things are needed, in that fashion. I guess, in addition to, and as you alluded to in your question, and it's really imperative that you develop and hone certain skills throughout your career. And I think those can be developed in many different functions and many different roles, but you know, you're going to need these, if you really want to lead the team and be proactive and addressing the problems that come up every day in business. And I think some of those skills specifically would be, you know, leadership, analytics, planning, communication, and the strategic decision making. It's really key that you're developing these kinds of skills throughout your career. And those can be things that you develop in finance and accounting. It could be in strategy, business development, operations, or other functions, but, you know, every role should involve developing, utilizing those skills. So that you're really ready, when the time comes to take on all of the responsibility and scope, that comes along with the CFO role.   Adam: (04:07) So as I hear you talking about all the skills that are involved, one of the things I heard you mention was, having a good network surrounding yourself with people, even people that are smarter than you, I've heard, a lot of people say, it's almost like you're being, almost like you have to be an effective business partner. You have to connect with all these different people. So we've covered some of the skills needed to evolve, then what's next?   Jason: (04:30) Yeah, then I think it's, it is like you just said, you know, becoming an effective business partner. I think the, you know, the way that you do that, you know, first and foremost is you've got to have the trust and respect of, you know, whoever it is. You're partnering with the CEO, the general manager, plant manager, department manager, you know, whoever it is you're supporting as a finance leader, this comes through, you know, basically experienced performance on the job. You know, sometimes it develops quickly. Sometimes it takes some time, but every one of my CFO roles has really evolved and become more impactful, over time. So it was more impactful, I would say at the end than it was at the beginning, as you know, I've developed trust and, you know, and experience was gained, you know, with the individual that I was partnering with and supporting. So I think you have to realize you have to be flexible and, you know, one approach to partnering is not necessarily going to be sufficient, over your entire career. And I've seen really great business partnerships and I've seen some not so great business partnerships in these roles. You know, the one, you know, the ones that didn't work out were usually sort of doomed from the start. It was just, you know, a lack of trust, lack of respect, or maybe appreciation for the role or function of the, of the other person. and that was just something that was never overcome, for one reason or another. So I think, you know, as I mentioned, that's first and foremost, is that you gain trust and respect. I think it's also important to know you can have two really great people, you know, it can be world-class in their respective functions and they still don't have really an effective partnership because they can't work together as a team. So it requires a lot of effort, you need to share information, there needs to be, you know, information and thoughts being shared on a two-way basis, you're working towards common goals and as are said earlier, you really need to respect responsibilities and the focus of each other. But if you, if you get all of these in place, then you can really maximize the effectiveness of both roles. I don't think either person can be highly effective. I think, you know, they can still be effective and really good, but I don't think they can be highly effective and at their best, without really the help and support of the other person. So it's imperative that the partnership work well, you know, for the benefit of that team, for the company and really for the organization overall.   Adam: (06:53) Now, Jason, there's something I've heard, you know, other CFOs, your colleagues, your, your peers say and things I've read that in IMA's research that, you know, the CFO of an organization must not also miss not only be able to share insight, but also lead through foresight. So when it comes to innovation data value, how can the CFO navigate the challenges associated with forecasting and best position the organization for sustainable success into the future?   Jason: (07:20) Yeah, that's another really great question. I think it's one of the biggest challenges for the CFO, but I think, you know, at the end of the day, the CFO really has a great perspective with which to lead and position the organization for success. We're usually the first to see the numbers. we've got deep insight into the operations. We've got the ability to drill in, on areas of concern, come back, make sure the organization understands them and, you know, offer solutions as well, so that things can be dealt with on a quick and timely basis. I think in the, right hands, you know, this data and understanding the business can be, can be really powerful, lead to great insights about how to position the business for the future. But, you have to have the right systems in place. You have to have a coherent digital strategy, the plan to track and report, and seminate the data as well as analyze it. And that's now the subject for a whole other podcast. But ultimately, you know, having all these things in place can set the direction for the company or the strategy for the company. You can help you change what you're doing in terms of allocating capital or resources in a particular area. You can also recommend something that has been put forward or as an initiative for the company that isn't necessarily working be stopped. I mean, this last one is one that I've seen, you know, finance organization or finance individuals, take a lead on many times in many organizations in many companies. They're the ones that say, "Hey guys, it's time to stop doing what we're doing. It's time to reevaluate or course, and take a new path or sort of cut our losses and come up with a new strategy". I don't think there's that many positions in the company where you have this kind of confluence of information, and it's really powerful in helping you address challenges. And, and as I mentioned earlier, to course correct, depending on what the business dynamic is. So I think the CFO has to be ready to use this information, gotta be ready to speak up, in regards to the trends, you know, the direction of pressure in the marketplace or the organization and make sure everyone understands what the data is telling them and come up with viable strategic solutions to address them.   Adam: (09:34) So a lot of accounting and finance professionals, their goal is to get to that CFO level. What skills does a CFO need? And, you know, we've talked a lot about some of those skills already, but if you're an aspiring CFO, what, what, you know, what should you set your sights on? Where should you develop your skills, to get, you know, to get to that next level?   Jason: (09:55) Yeah, a great question. I think, you know, some of the skills I mentioned earlier, but let me, let me dive a little bit deeper into what I think are really the most important, and get a little bit more granular in terms of what, what you really need to become an effective CFO, if you're trying to get to that level. But one of the ways that I think about it, is, is a way that my mentor, you know, 20 years ago, a CFO that I worked with describing it. So basically, you know, finance, you have two different jobs, right? And they're equally important. The first one is you gotta make sure the numbers are right. And this is, you know, reporting the controls, processes, systems. I mean, ultimately you're the single source of truth for the organization. And this is where you're going to spend, you know, 51% of your time, the other 49% of your time is to help improve the numbers. So it's really that simple, you know, those two things. And by improving the numbers, now we're talking about getting involved with strategy analytics, restructuring exercises, maybe a new initiative, you know, M&A, when that comes up, business development, cost reduction, working all of these things with the operations and the commercial folks. And I think, you know, the CFO can lead and dig into both areas, or the one that, that can really lead and dig into both of those areas is going to be the most highly effective and is going to be the best advocate for all the key stakeholders in the firm. I've been involved in a couple of situations where, you know, the first one wasn't in place, you know, the, the control aspect to it and making sure the numbers are right. And we spent massive amounts of time putting the house in order. And it became the only job we had, for some period of time. So we had to build the foundation through people, processes, and systems, so that we could really move on to the more value added activities of the job, which is the second piece that I mentioned. I think the, the other piece is that there needs to be complete transparency. So you have to develop the skill for, you know, putting out not only the good news, but the bad news and make sure that there aren't any surprises. I used to have a former CEO that said, you know, bad news doesn't age well, and I think that that adage applies to every organization I've been in. You don't want to hold up the dissemination of the bad news because the situation could get worse. A lot of times they don't resolve themselves favorably. And if you can get the information out there quickly enough, you can bring to bear all the resources of the organization on the problem. And I think the key for the CFO, here, is to the set the tone at the top. So the organization falls this line of thinking, constantly. A couple other points: I think you need to build organizational rapport. It's good to have strong partnerships with all of the executive staff members, or the extended staff. And, and these will change depending on the job that you're in, but learning how to develop organizational rapport, is important because you need to be a trusted resource for, for all of those stakeholders. And you can't really have the impact you want to have in an organization unless you've got that rapport. And if you do have it, and your impact is going to be much greater than it would be otherwise. And I think, lastly, I would say you just need to approach the position with a balanced viewpoint. Don't be too conservative, don't be too aggressive in your approach. You'd never want to approach, you know, an accounting problem or our forecast now with that mindset, for instance, because you'll end up being, over time, if you continually do that, you'll end up being labeled and you'll continually get second guessed. So in an example of a forecast, I mean, when you put together a commitment, you want to have balanced lists of risk and opportunities to discuss when you talk about what the number is going to be. This ensures that everyone understands what you've put in, right? That it potentially could be an issue, right. But you've talked about and learned how to mitigate those issues. And you've talked about opportunities that maybe aren't there, that you're going to work on, to make sure that they benefit the organization. So you're trying to get to the right answer for the reporting for, you know, for our business forecast or, or any particular problem, regardless of the, you know, the accepted practice or maybe the potential organizational impact, you have to be able to do that. And over time, these forecast, terminology, these beats and messes, they should balance out, you know, solid reasoning for your decisions along the way, that's important to get your decisions or your recommendations accepted by doing that and having this, I think it's important basically to make sure you've got a strong reputation along these lines, within the organization or within the company.   Adam: (14:35) So as we wrap up our conversation, do you have any thoughts on the role of the CFO and building their organizations, as we look toward the future?   Jason: (14:44) Yeah, I do. I think overall, you have to be flexible in your approach to the organization and to the business partnership that we talked about earlier. I think, you don't want to be flexible when it comes to your approach to ethics, controls and compliance, but, you know, as the scene goes in career progression, what got you here, won't get you there. these are kinds of things that you need to think about as a CFO. And when I, when I talk about, compliance, I think it's pretty clear what, I mean, there's really no room for flexibility here. You need to possess, an exhibit to the organization and impeccable ethics. You gotta be strong because there's going to be issues that you're gonna face, on compliance or controls, or, you know, you're asked to push the limits. These just aren't areas where you can compromise, but on your approach to the business and business partnership, I would say, you know, every dynamic, you know, a CEO and a CFO is, is different. You're going to need to adapt your operating style, many times to work most effectively with, you know, see if a CEO or general manager or department manager, depending on, you know, whatever the case may be. So your principles and focus can be the same, but your approach to the job, is going to be different. And sometimes just in order to get the same result, you know, but ultimately that's what you're all aligned towards maximizing the strategic value of the enterprise. So I think flexibility is key there and it's also a key in addressing business problems and building an organization. More directly answering your question, that's capable of thriving in the future. So if a finance organization can sort of learn and grow along with the company, and the organization to be, you know, make sure they continue to be relevant, and capable of helping the group with strong analytics and strategic decision making, then they're going to be hugely valuable to the, to the organization.   Closing: (16:39) This has been Count Me In: IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Russ Porter: https://www.linkedin.com/in/russporter42/Contact Margaret Michaels: https://www.linkedin.com/in/margaret-michaels/IMA® (Institute of Management Accountants): https://www.imanet.org/IMA's Ethics Center: https://www.imanet.org/career-resources/ethics-centerMembers of IMA shall behave ethically. A commitment to ethical professional practice includes overarching principles that express our values and standards that guide member conduct. IMA’s overarching ethical principles include: Honesty, Fairness, Objectivity, and Responsibility.  Members shall act in accordance with these principles and shall encourage others within their organizations to adhere to them. IMA members have a responsibility to comply with and uphold the standards of Competence, Confidentiality, Integrity, and Credibility. Failure to comply may result in disciplinary action FULL EPISODE TRANSCRIPTMitch: (00:05) Hey, everyone. Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong. And today I will be previewing a special bonus episode in our series. October 20th is global ethics day, a day created by the Carnegie council for ethics in international affairs. Global ethics day is an annual moment to empower ethics through the actions of individuals in organizations. It takes place annually on the third Wednesday of every October, ethics lies at the heart of the management accounting profession, and IMA considers ethics to be foundational to its work in core values. For this special count me in podcast, in honor, of this day, we are delighted to have IMA's CFO, Russell Porter discuss why ethics is so important to management, accounting and financial oversight for organizations. IMA's manager of brand content and storytelling, Margaret Michaels will ask for us to share his experiences working in management, accounting, some of the ethical dilemmas that can arise and how he learned to navigate questions around ethics to steer the organizations he has worked for in the right direction. Russ will also provide information on IMA resources that are available to members who want to learn more about navigating ethics. So to hear more about this very important topic, let's head over and listen to their conversation now.  Margaret: (01:34) So welcome Russ to IMA's Count Me In. We are so happy you could join us for this special and important episode.  Russ: (01:41) Pleasure to be here, Margaret, and, thanks for, initiating this discussion about ethics. It's a personal favorite topic of mine.  Margaret: (01:48) I know you are very interested in helping IMA members navigate ethical questions and issues they face every day in their work. You even did an unscientific LinkedIn poll asking what the most important ethics issue facing accounting and finance professionals today is. What did you find out? And what do you believe is the most pressing issue they face?  Russ: (02:11) Yeah, it's funny, Margaret. Unsurprisingly, I did not get a lot of responses. And a lot of the ones I did get were in one-to-one messages, as opposed to being on the LinkedIn message board. Ethics is one of those areas that people often don't like to talk about. Despite the fact that we read about issues of ethical lapses in the papers all the time, that said, when you look for them around any business environment, you'll see plenty of ethical issues. Most of them are addressed right up front in a company's culture, but when the ethical component of culture isn't strong enough, the temptation to overlook principles can overwhelm people. Keep in mind, also there are, in my mind, two types of ethics to consider: the macro and the micro. The micro is the one people often think about where an individual or a small group has to make a decision between the right way and the wrong way as if decisions were that black and white, but there are also macro ethical issues like sustainability, equitable treatment, proper governance, those are affected by individual decisions, but they can often have a much wider impact.  Margaret: (03:25) Yes, I agree. I think we are seeing those wider impact issues around us every day. I know that I am much more aware of those macro issues. And I do think that business has really been stepping up to the plate to try to address public concerns related to the climate or income inequality or gender bias or racial injustice through their work on sustainability. In this way, sustainability really has an ethical dimension beyond just reporting non financials. Is this a change you welcome in the profession and how does sustainability change the paradigm for accounting and finance professionals from an ethical perspective?  Russ: (04:07) So Margaret, all those items you just mentioned under the umbrella of sustainability economists call them externalities because in theory, these are effects that don't directly impact an organization making the decision. And for that reason, management accountants often exclude sustainability issues from a relevant cost benefit analysis. That idea of what costs are relevant to an organization. It's really been expanding though, in the eyes of consumers, regulators, and investors, they're all taking those elements into account when making their buying or investing decisions as society increases the focus on those areas, through the lens of ethical treatment of the planet and society, accountants, ignore those issues at their peril. I would also point out that, you know, perspectives on some of these macro ethical issues can vary greatly. Different cultures, whether those cultures are based upon geography, religion, political affiliation, or any other factor, they'll interpret an ethical approach to issues differently. Now exploring these different perspectives, that can really be valuable in increasing our understanding of the topics. But it's really important to be aware of how the societies in which we operate view these issues. For an management accountant, that perspective and that understanding - that's crucial.  Margaret: (05:39) Those macro ethical issues do have many dimensions and awareness of that fact is critical for the accounting and finance profession, as well as society at large. And since we're on the topic of macro issues and changes affecting society, I think it's a good time to up something that has literally transformed the profession, which is technology and digitization. At IMA, we are acutely aware of how technologies like automation, AI, and data analytics have changed the way management accountants work. Upskilling in technology is something we champion, but while the technical skills involved with these technologies are significant, so are the ethical questions. What is your view of technology from an ethics perspective?  Russ: (06:28) So Margaret, digitization, it's not just affecting the accounting profession, it's affecting almost every element of our lives and in society today. And there's a lot of good that comes out in terms of both individual, as well as societal welfare. That said, the application of technology, if not done well. Well, that can also exacerbate existing tendencies to a detrimental effect. For example, we've been hearing the term algorithmic bias lately, and that is the propensity for technology driven algorithms to lock in the biases of maybe the people who designed them, or maybe the data sets that were used to create baseline information on which those algorithms rely. Critics would point to areas that we've been hearing about in the news, like resume filtering, neighborhood profiling and banking and loans, or even facial recognition as emerging applications that can perpetuate inappropriate biases. Now, ethics enters into the equation as does management accounting in the design and the testing of these applications to make sure that they produce appropriate truly unbiased results. That's where the management accountant can be of value. Our profession can review and "audit" these types of technologies to ensure that they provide those unbiased answers the same way we apply our bias reviews to financial forecast and analysis.  Margaret: (08:08) That's interesting. I never thought about auditing a technology, but it makes perfect sense in light of technology's pervasiveness and impact on our lives. It does sound like the perfect job for a management accountant. I wonder with COVID-19 and the rapid shift to remote work that many organizations had to quickly enable with technology, what new ethical issues and risks are arising. For instance, a recent IMA and ACCA survey found that one in five management accountants has directly or via work colleague encountered a situation where as a result of COVID-19, ethics were at risk of compromise. And these ethical dilemmas also come at a time when society at large is experiencing declining levels of trust in government, the media, and look to business to lead by example, according to the Edelman 2021 trust barometer. With so much weight being placed on management accountants and businesses in particular, to do the right thing, how can CFOs build a culture of trust within and outside their organizations? What kinds of support do they need to do this? And in addition to finance, what other departments are critical to building trust?  Russ: (09:25) That's a surprising statistic. The one in five management accountants facing an ethical compromise issue. Now COVID may have exacerbated this trend, but, you know, candidly, the pressure on individuals has always been there, whether it's protecting a company's stock price, making sure that, you know, trying to protect the company's reputation or even one's own compensation. There's always a reason for accountants and other managers to manipulate, reporting, or hide negative information that might blemish the company or otherwise, you know, mislead investors, clients, regulators, inappropriately. Now there's always that pressure, but most companies effectively reinforce their ethical principles to counteract that pressure. And that comes from a series of measures. We we've all heard about tone at the top and lately there's been an emphasis on, you know, the mood in the middle where middle managers echo and reinforced the ethical standards of an organization, but really it does matter what leaders do and how they demonstrate their own responses, both to the pressure to perform, but also to identify unethical behavior in their firms when it arises. CFOs, we've got a lot of influence here, but we've also got support from legal, internal audit, external auditors, regulators, and the general public who are going to hold companies and organizations accountable for their ethical lapses. The best ally we have though in most organizations is the CEO and the line management team. When those leaders walk the talk call for and demonstrate ethical behavior, that's going to permeate the organization.  Margaret: (11:19) Great, and it is critical for the CEO and line management to walk the talk, as you say, I'm thinking of recent financial fraud scandals like Enron, or Maydoff as examples of what happens when ethics is not part of the tone at the top. In fact, because of those scandals, many MBA programs have revamped their curriculum to include courses on ethics. Some colleges and universities even teach ethics as part of undergraduate accounting and finance programs. Why is it so important that students be taught ethics early in their career? And what was your personal experience learning about ethics? Was this something you learned as an undergraduate or did you become more aware of it as a working professional?  Russ: (12:04) So, so I think it's vital, absolutely vital for students to learn about ethics in their undergraduate courses and continue that into later education, whether that's later in academia or in the workplace, I think it should be embedded into nearly every course in business, rather than being treated as a separate concept. It's, it's really ethics applies to everything we do. Now. I was fortunate in that I took an ethics class at my freshman year at the university of Delaware. So it became a part of many projects and discussions with my study groups early on. I've also worked at two companies, IBM and now IMA, where strong, ethical principles were a foundational element of the organization's culture. Not every company has that though, which is why it's important to start ethics education early. The real key is to make ethical decisions, instinctive a natural part of the thought process so that when employees are faced with an ethical dilemma, students and employees can, number one, recognize it. Number two, analyze it thoroughly and three act accordingly and communicating, using the strength of a principle-based approach to the ethical matter.  Margaret: (13:28) I agree students who learn ethics early will be in a much better position to act in a principles based manner when issues arise. I think it also helps to have a trusted source to turn to for ethics guidance at every stage in your career. And I think that is the value of IMA. When you are a member of IMA, all ethics courses are offered on a complimentary basis, and you have a community of peers who must adhere to the IMA statement of ethical professional practice. As the condition of membership, IMA has a long history of providing resources for accounting and finance professionals to behave ethically. How important are professional associations like IMA in maintaining standards and ethics?  Russ: (14:13) Margaret, I don't think that anybody ever goes to work and decides, I think I'm going to be unethical today. We all spend our days responding to the various pressures to which businesses and individuals, you know, have to respond. Sometimes the temptation is really great to sacrifice the long-term, like our principles for the short-term of getting through the day, the earning season or the audit. Organizations like IMA offer a structure for ethical decision making, which I think is key for accounting and finance professionals. IMA's statement on ethics in the profession, provides a framework for our members and our non-members to follow including guidance on how to handle difficult situations and what principles should not be compromised regardless of circumstance. These along with our ethical helpline, which aids management accountants in understanding IMA's ethics statement. Well, they're designed to give our teams the support that they may need in a very difficult circumstances and helping them make the tough calls to predict the true integrity of their organizations. Now, if you don't mind, I'm going to end where I started. Discussions of ethics can be really, really tough. They can be gateways to our individual morality and an exploration of one's ethics is really an exploration of one's character that can be uncomfortable for some people to openly discuss. But I really believe there's a real benefit to talking about the ethical codes of our workplaces. It helps communicate our culture to new employees. It reinforces the behavior of people at all levels of the organization, and it provides the long-term benefit of maintaining the integrity of our organizations. Ethics should and must be a bedrock of the accounting and finance profession.  Closing: (16:17) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Patti Humble: https://www.linkedin.com/in/patti-humble-46651235/FULL EPISODE TRANSCRIPTAdam: (00:05) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm Adam Larson and I first like to thank you for coming back to hear episode 146 of our series today's conversation features Patti Humble, the chief accounting officer at UPS. Patty is an experienced senior leader with a broad background in both business unit and corporate headquarter environments. She is also a passionate leader who truly emphasizes personal development and the need for knowing yourself first. Next, you'll hear her discuss steps to successfully getting to know yourself and how that translates to strong leadership. So keep listening as we head over to the conversation now.  Mitch: (00:50) So I know our conversation for today is going to be about developing others, but I understand it's very important to you. And I know it's a topic that you're very passionate about. So for some background for our listeners, why don't you start off by telling us why this is so important to you?  Patti: (01:05) Well, thank you. I appreciate that. And I'm just going to begin with kind of an overarching statement that, you know, what, we all have a unique purpose in our lives, right? We all want to make a difference for our families, for our workplaces, for our country, even globally. And so just pause for a second and think about that. How do you make a difference? Because in my view, effective leaders, they have to start by knowing themselves first, before they can start paying it forward to others. So for me, self journey, my self knowledge and my journey, that was a linchpin. And that's when I really started putting some of my leadership puzzle pieces together. And I'm really passionate about this because I really want to share some of my aha moments with other people. I think what I've observed is that people are often very hesitant to go deep inside themselves. It can be intimidating, it can be a little scary, but as I look back over the course of my career, I found that I really needed to know myself first. And only then is when some of these other leadership traits, my coping mechanisms, all of that started to fall into place. So that's why I'm so passionate about it.  Mitch: (02:31) It's very fascinating. And you know, I'm curious these aha moments, you know, you said a couple of times right there, you have to know yourself first. What does that actually look like? You know, and I'm sure it's different for different people. but what do you, what does that ultimately look like to you when you make that recognition?  Patti: (02:54) Well, I think it's knowing your style, right? It's what drains you of energy when you get home at the end of the day and you're just wiped out what happened that made that happen and what gives you energy? I mean, when you think about those moments where you're just really jazzed, what was that? What gives you energy or maybe it's where you look up at the clock and you've totally lost track of time. I mean, the hours have gone by, and you just don't even know where the time went to. It's knowing that it's knowing your personality type. I think we all kind of have a sense of what our personality types are like, what are our blind spots? Where, what are the landmines that we might step on more than once. And also it's knowing your hot buttons, right? We all, we all know what those are too, but I think knowing yourself is really, it's so important because people succeed differently. So for example, extroverts and introverts, they succeed very different in the world. And you may, or you may not know where you fit along that continuum. And when I say introvert, I don't mean people that are shy. All right, there's a misunderstanding about introverts. Introverts are people that get their energy differently from thoughtful and quiet activities, right? We know our extroverts love to, to be around people and go to events. It doesn't mean that you're different, you're different than in a way that you succeed differently. That information can be really critical to adapting how you lead and how you position yourself for advancement in your workplace. So there's that piece of it by knowing yourself and even on a more personal level, you have to know yourself to know how you cope and, and to conquer sometimes your own gremlins, whatever those might be. I mean, think about what happened to us during COVID right during this pandemic, our coping mechanisms were really taxed. They were really strained. And I think that's a global phenomenon. So you probably learned some things about yourself during the pandemic that you might not have known and some of your gremlins might've been more pronounced, but I think when you know yourself, you're aware of your thoughts, you know, how you talk to yourself and you can talk yourself through moments of fear or uncertainty, you know, how to speak to yourself in the third person. So, you know, you think about the movie that runs in your head and you know, you tell yourself, oh my God, I can't believe I screwed up or I, how could I have done that? There is not a third person that would speak to you the way you speak to yourself. So try talking to yourself, like another, someone who loved you would speak to you, they'd say, you know what? You tried your best, you did the best you could with the information that you had, or yeah. You know, I didn't handle that so great. But you'll do better next time. If we speak to ourselves that way you talk to yourself, instead of listening to yourself, you try things like being grateful, when you're stressed out, because you look to the bright side of things, it's all that, that movie that, that plays on in your head. and I think that's part of knowing yourself. It just helps all those coping mechanisms work really well. A good friend of mine recommended me to me once, to create an "I love Patti" box and then fill it up with all the positive affirmations that you get that you receive. And then when you're having a really bad day and you need a boost, you just go read all those things all over again to say, you know what I do well, I am loved. And it just helps that, that inner, that inner voice. And I think that's really, really an important part of knowing yourself because knowing your style, knowing your energy, knowing how you speak to yourself is the platform for leadership.  Mitch: (07:05) I think that's all amazing advice. And as you were sharing this information, I started thinking, you know, we kicked things off talking about or setting the stage, really developing others. And it starts with you first. And as you're speaking, I kind of said, you know, developing others that other person can still be yourself. You know, it's, it's, you know, it's the other person that, you know, people see that maybe you don't always see. So, it's really interesting. And as you, I can understand the more you learn about yourself, the easier it is, as you just said to then eventually develop other people other than yourself and lead. And it's just all full circle. So you'd already just mentioned a few really great techniques, but I'm sure, you know, you're very passionate about this. You have other things that we could share with the listeners, you know, specific steps, anything that, again, how do you identify when you are successful in knowing yourself, you know, what, how, how can our listeners take this another step further?  Patti: (08:05) Yeah. well, there is a wealth of information out there on the internet about personality types. I mean, if you, if you put that into a search engine, you're going to come up with a lot of, of, material. I think, you know, people can start with something like a Myers-Briggs assessment. There's a number of things that you can do that are on the internet that are, that are free, but that's only the beginning. So like for Myers-Briggs you get come back and it's a four letter, kind of acronym that you get, but then the hard work starts. You have to read about your personality type. You have to learn about you, it's doing the homework. I mean, treat it like a treasure hunt. I mean, why do you react and behave the way you do? I, when I started digging into that and go, oh my gosh, this is, so me, how could I not have known that this is how I'm wired? And this is the way I behave. And it totally made sense. And I think once you see yourself in that light and you know, that there's other people kind of like you, it becomes, it leads to a sense of self-acceptance. And I think we all can struggle with that, at, at times, and because I'm an accountant, I actually made a small binder. I called it the Patti playbook. I think I kinda kind of figure as I went through the, the Myers-Briggs material and I did all of my homework, but it really was eye opening and it was especially eye opening when I shared it with my family, I said, you know, when this thing happens and I behave a certain way. Yeah, that's, that's, that's how I'm wired. And they're like, oh, it was really, it was really, really eye opening for them as well. And they understood what's kind of hardwired, into us. it going beyond that some companies, will support the cost of what's called a Hogan assessment, which is a little deeper than something like a, a Myers-Brigg and companies can actually put that into maybe your individual development plan. So my only advice on that, is make sure that when you get your Hogan results back, you need to have an expert read that back to you. Somebody that's familiar with how a Hogan, what a Hogan is measuring and what your results mean. So, and the reason I say that is, unfortunately for me, I spent about three years with a misunderstanding about my Hogan assessment and that misunderstanding actually sent me backwards a little bit. So just, just make sure that if you're going to have an assessment like that, that you really are getting expert advice on the, on the results. There's other taxonomies out there in this arena. There's one of them that puts, leaders into what they call the four faces. So you can, you can be a catalyst, a strategist, a steward, or an operator. Now, most accountants like us, we tend to be stewards and operators, because again, that's kind of how we're hardwired and that's why we went into the profession in the first place. But I will say, I think we all know that in a post pandemic world, our organizations more and more are going to be looking for us to be catalysts, change makers and strategists. So it's great to be a steward and an operator, but knowing where you fit on that, that fourplex helps you understand where it is you need to grow. I mean, ask your family. I mentioned that before, when, you know, I did the, my Myers-Briggs, I mean, they know you, they know your personality, they know how your energy ebbs and flows look for patterns on how you interact with them. Those are clues, right? And in every, in every family, people kind of play parts, it's kind of like a little play, but, you know, are the people that are closest to us. They know our strengths and our weaknesses and our hot buttons. So also treat that like a little bit of a treasure hunt, ask your family members about you and getting to know yourself. Next you can turn to the workplace. So what is, what's the word about you at work? What's your buzz? Both from your boss, from the folks at work, from you, from your peers, and if you don't know what that is, I would recommend that you need to find out. and don't just ask for feedback, just general feedback from them. I mean, you ask, once you're learning about yourself, ask some really, really specific questions. and let me just give you an example. So a question, a specific question might be, what's the one key thing that I could change in order to become more approachable. If that's something you're working on or another question might be, what do you know that I will never get to know, but I really need to know that that one was really open-ended question that you could ask some of your coworkers or your boss, and that really elicits a lot of, of openness from people. And I guess the last thing on this topic, I would say just, you know, getting to know yourself and your steps along the way is, remember when you're done with this, your greatest strength. Well, that's also your greatest weakness, right? So for example, accountants, we love certainty. We love detail. We love the fact that there's just one answer. That's our craft. That's what we do. But I think we also know that we need to learn to live in lots of shades of gray, rather than the black and white, organizations are asking us to see the big picture, get up to 50,000 feet, be able to speak, you know, in, non-accounting ways to other folks in our organization. And also remember your strength is your weakness. For example, going back to, if you're an introvert, how awesome is that? That's a strength where you're going to pick up on clues that other people might miss. And you're going to balance out your team with diversity of thought, but also know that you have to modulate. You have to be an extrovert. Sometimes you need to turn it on when you need to not, not 24/7, not all the time, not asking you to change who you are, but we also know that in corporate America, you need to be able to modulate back and forth. And when you can be honest with yourself along this journey, that is when you will really know that you're growing.  Mitch: (14:43) And I love how you continue to bring this back to accounting, because, you know, particularly here, obviously with IMA, we're really focused on the evolution of the profession, right? The future of the profession and upscaling, and you mentioned a lot about, you know, being able to tell the whole story to those non-finance people and a big word around IMA that we use is being adaptive. Right. And being able to take that next step, particularly the last year and a half, you know, how everybody was forced to adapt, but our real leadership strength there. So I want to keep our conversation here, going in that direction, you know, turning to adaptable leadership. What are some of the things that you've experienced and what is this dynamic really look like? How does knowing yourself and becoming adaptable tie in with leadership and, you know, just bring it full circle for this conversation.  Patti: (15:37) Yeah, well, I think people are like puzzles and most accountants really love problem solving. We probably like puzzles. So understanding people and leading people is, is rather the same because there's no two puzzles that are alike. And I mean, if you look at online again about books that are written on leadership or adaptable leadership, I mean, there are oceans of books. It's, it's actually really confusing, you know, on what you know, which is why I want you to go deep first. I want you to understand yourself first so that you can understand who you are and what you bring to leadership. And I think that also informs you, that you have to find your way in leading you won't lead like your boss, you will lead like you because you are unique, your blending, the best of the people that you've worked with and worked around and you've absorbed all of that. And you're customizing it along with your personality and adapting all of that into this, this puzzle. That's you. And I will say that I personally, I spent too much time trying to be a clone for one of my bosses thinking that that was the only way to lead, but you know what? I wasn't cut out of that same cloth. I wasn't raised to the same way in my family of origin. I didn't have the same work experiences. So I wasted a lot of time thinking that I had to be them when I should have been again, investing more in me and adaptable leadership comes back to modulating. So remember when we talked about that in the last section, right? Modulating, introvert, or extrovert, or, you know, kind of knowing yourself, managing yourself, this is the exact same thing, leaders modulate to get the most out of every person's different strengths they're putting together their puzzle, right. And their uniqueness. So when you're adjusting your style to what everybody needs, what each person needs is called situational leadership, right? It's this modulating, it's that adjusting. and it's tough. I think for accountants, again, they kind of want a single answer. When you learn how to manage a group of people, you want to be able to take that cookie cutter and move to a new group and say, okay, I know how to manage now, but you don't. Right? Because when you move, it's a whole different set of puzzles and a whole different group of people. But that's another place where we really have to live in the gray and we have to experiment right. The first time that you work about around someone, that's just argumentative. You know, you learn how to deal with an argumentative person it's called situational leadership. And then you're going to take that learning and adapt again. And you, now, you're, now you're going to know how to, how to do that. I think also adaptable leadership is how you build out your group, right? When you are comfortable in your own skin and you know yourself, and you look around your team and you can see those strengths and weaknesses in your team, you also know that you have to build a diverse group of thinkers because you don't want people around you that just agree with you or look like you, or act like you, or think like you, which is really our human tendency, right? We like being around people that are similar to us that are kind of in our tribe or the way we think. But when we welcome dissenting opinions is when we really get the best out of being an adaptable leader. And it's really fascinating to ask people that are different from you. This question, what would you do if you were me, because you're going to get a really different answer. But that diversity of thought from being an adaptable leader and welcoming those dissenting opinions are going to be really informative. And you'll be better because of the diverse group of thinkers that you brought together. But again, that's got to come back to do you know yourself, and have you looked at that situational leadership and your team to know how your, how your group needs to be rounded out with all of those skills and talents and opinions.  Mitch: (19:58) And let's keep going on that topic for just a moment here, you were talking about kind of building out your team. And I think one of the best representations of a good leader is, you know, their tree, right? The people that they develop and, and who's next, essentially. So when we are talking about our team and developing others, how should young leaders think about developing their own strengths? And, you know, obviously knowing yourself first, I think has to be first and foremost in communicating that to them. But as a leader, communicating to future leaders, what's the thought process, you know, how do we go about instilling this mindset with them?  Patti: (20:37) Yeah. I think one of the things they have to understand early, or, you know, young leaders is that, you know, your career is not a ladder, it's a jungle gym. It's going to be lots of jumping around. Early in a career I really ask young, young people, young leaders to focus really on their self-development first, right? Your path to success in general is always going to include being hardworking, reliable, results-oriented, trustworthy, and in our profession, extremely ethical. All of those things are what you have to build out in the first stages of your career. I also tell people to take notes. I mean, I mean, literally take notes, observe leaders around you. What is it that you want to emulate? What do you like, what do you think you can do when the way your built your personality? Who do you want to be like? And then also kind of who do you want to avoid? We all have those people that we work with for, or around where we go, oh, I'm never going to do that. But, but know that, I mean really study other leaders, make yourself a little cheat-sheet. It's actually fascinating if you do this over a period of years to go back and look at some of your early notes of what you were learning, because now you've absorbed them and they're really, they kind of become part of you. So I think your early career really has to focus around self-development.  Mitch: (22:10) And then how about later in the career, you know, your, mid stage, late stages of your career, and again, we're talking about leadership, how does your mindset and your approach to this mindset vary?  Patti: (22:23) Yeah. So by mid career, we hope that all of us have kind of, had that subject matter expertise. That's that's largely been mastered, right? You've got that in your rear view mirror. You've mastered your craft. Your roles that you're taking on in your mid career are now demanding kind of more ownership, more responsibility, and certainly more leadership. This is where you're transitioning from being a subject matter expert or IQ, more towards EQ or emotional knowledge. And that's also where your hard work, and investment from knowing yourself is really going to start to accelerate your effectiveness. This is where, where it really starts to gel. There's a good book for mid career that I liked. It was called, "What Got You Here Won't Get You There". It's by Marshall Goldsmith, I found that one particularly helpful just to kind of sometimes get you out of the little, the little rut, that, that you're in. The other thing kind of shifts in mid or late career about leadership is also the leaders that you have. And let me explain what I mean by that. So you need to make sure that you've got sponsors. Now, sponsors are different from mentors and coaches. What do I, what do I mean by that? So coach just like in sports or other things, they show you how mentors can give you advice, but sponsors, those are the folks that speak up for you when it's time for decision. Those are the folks that are powerful enough to be in the room when decisions are being made about you, about you and your development and your assignment. So I think that's it. It's not specifically your leadership, but it's something you need to be very mindful of about leadership in general is just to make sure that you've got sponsors. And I think the other thing that's super important in this mid-career is asking. If you don't ask you don't get, I have a quote that's actually taped on the bottom part of my monitor by my computer. And it says, if you don't go after what you want, you'll never have it. If you don't ask the answer will always be no. And if you don't step forward, you're always going to be in the same place. So it's just a really good reminder. That's super important in that mid-career ask and ask and ask. In mature career, I'll call it mature career, right? comes the ability really to influence that's where you start to really affect change. And when we get to this part of the leadership journey, I think that, you know, the leadership traits here, also include really being able to communicate with nonfinancial executives in your business. It's the part of your career where you're really taking risks outside of your comfort area. If you've always been in an accounting vertical, maybe you're taking a leap over into a business unit or planning or marketing or something like that. It's getting comfortable with being uncomfortable. That stage is where you really kind of learn to respect the culture of politics doesn't mean that you have to necessarily adopt it, but you have to respect the culture politics. You have to get comfortable in your leadership role to know enough to not to miss out on anything important, but you don't need to know it all. And I think for accountants, that's really hard because we really love knowing all the rules. We really love the detail and separating yourself from that and being okay with knowing just enough is kind of a difficult transition in that part of your career here also in this time, you're spending more and more time developing your people. And so all these things we've talked about, about your leadership, knowing yourself, taking risks, asking this is where it all comes to a crescendo, because this is where you're developing your people. You're asking lots of questions rather than you're asking more than you're telling and you're really see being able to focus on developing all, all of that learning in into your people.  Mitch: (26:53) Well, Patty, this has been incredibly insightful. I've honestly really enjoyed this whole conversation and I just, am very appreciative of everything you shared. And I want to give you an opportunity if there are any final thoughts that you have on this topic that you would like to kind of wrap up with.  Patti: (27:09) Yeah. So just you're right. Just kind of wrap this all together. So the journey of a leader, I think has several key skills. As I think about it. First, we talked about invest in your own learning and I mean your intellect and your personality, that's the investment you make in yourself. It's hiring those exceptional leaders for your team, that diversity of thought, and really developing those, those self-reliant teams. It's getting out of the details and not micro-managing as hard as that might be. We talked about communicating, right? You got to communicate in all directions up, down and sideways. And I think lastly, one of my favorites is Bernay Brown. She has a pretty famous, Ted talk. It's about vulnerability and authenticity. It's admitting when you're wrong, it's being human and it's being humble. I think every one of us has such great potential to make a difference. So I have another small reminder. That's taped my computer monitor that reminds me, and it says be who you are meant to be, and you will set the world on fire. So thank you very much for your time today. I hope that some of these thoughts have been helpful.  Closing: (28:26) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Claire Chandler: https://www.linkedin.com/in/clairechandlersphr/Claire's Website: https://www.clairechandler.net/Talent Boost: https://www.talentboost.net/checklistFULL EPISODE TRANSCRIPTMitch: (00:05) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host Mitch Roshong and I would like to say thank you for coming back and listening to another episode of our series. The guest speaker for episode 145 here today is Claire Chandler an acquisition, integration, and onboarding specialist. Claire is a corporate survivor who draws upon almost 30 years of business leadership and consulting experience. One of her specialties is business value creation. In this conversation, you will hear her discuss what finance and accounting quite often get wrong when calculating business value. Keep listening as you will now hear from Claire Chandler with Adam Larson.  Adam: (00:55) So Claire, according to stockanalysis.com, I was reading that there have been over around 703 IPOs in the US stock market in 2021 as of around mid August, which is when we're recording this, which is 331% more than the same time in 2020. So needless to say, there's been a lot of business valuation happening as companies seek to grow and expand. So as we start off our conversation, can we talk about what drives the value of business?  Claire: (01:23) Yes, please. Yeah. What a great question to open up with, right. So, you know, back in the day we lived in an industrial economy, I think a lot of people make the mistake of thinking we are still there. and back when we were more industrial close to a hundred percent, about 95% of the value of a business, any business was driven by tangible assets, right? So things like a company's technology, the products that it made and sold, their operations and of course their financial capital, but we don't live in an industrial economy anymore. We actually live in an intellectual economy. That economy is dependent primarily on the output of a human mind. And I know that sounds bizarre when I say it out loud, but think about it. We're really driven by intangible assets companies, brand its services, more so than its products, the intellectual property, that the knowledge in the heads of the human capital, right? And so with this shift that has happened gradually, but we are fully ensconced in an intellectual economy. That shift also, changed what drives business value. So before it was almost entirely driven by tangible assets today, it's well over 72% driven by the intangibles. And we're seeing this across every industry - in some industries, if you look at say tech and pharma, they're close to a hundred percent driven by intangible assets, right. The products of the human mind. and so it's really critical that businesses pay attention to that.  Adam: (03:04) And then on top of that, you not only are you having to worry about the numbers and the financials, you have to start worrying about, things like ESG and sustainability are becoming more and more essential that you have to report, not only the mind, but also how, how is my business affecting the environment?  Claire: (03:20) Yeah, and it's, and it's interesting to that point, the markets have shifted in that way as well, right? The SEC has become more stringent and, has raised its expectations on what companies do, not only in the sustainability space, but also in terms of how people are treating and nurturing the human capital. So the markets have shifted, the economy obviously has shifted and, you know, the, the more successful businesses have embraced this and sort of incorporated that into their business strategy.  Adam: (03:51) So as we're thinking about businesses and, getting investors and growing IPOs, the other thing I was reading, I saw an article on Fortune the other day, it was saying that there's been over $2 billion of mergers and acquisitions activity in just 2021. I think that was through July, like the beginning of July. We're now like to mid August, you know, how can investors reduce the risk of investing in the wrong company, especially with so many different factors that we were just talking about.  Claire: (04:17) Yeah, it's, it's a huge question. Obviously, the bottom line is investors want to make their money back, in multiples, right? And so the way that to reduce the risks starts with their value creation plan hypothesis. They need to be crystal clear on their end goal, right? The clearer they are on what they want to get out of that portfolio company on the back end, whether it's a holding period of three years, five years, you know, even longer the clearer they are on that going in, the easier it is on the front end to make sure that the company they're evaluating actually has the capacity and the capability to deliver that return for them. Because obviously that is the goal, whatever form it takes, that investor wants to get the most bang for their buck. So they've got to be really, really clear on the hypothesis going in on what they expect to get out of their VCP.  Adam: (05:09) So then on the other side, what about what should companies be doing to, to attract the right funding? You know, cause you got to think about their side too.  Claire: (05:16) Yeah, absolutely. And it's, and it's all about the right funding, right? To your point. And it's a similar process for companies on that, on that side that are looking to grow through the backing of the right investors. So they need to be really clear on their end goal as well. And it's probably not as far out for them, it may not be five or 10 years. It may be, you know, 12 months to 36 months, but they need to deeply understand where they want to take their business and how ready they are to grow in that direction with, or without funding. Right. So, and I say that to really make this point, a lot of startups make this fatal mistake of believing that money is going to solve everything right. We get to the next level. If only we have the financial capital and that's totally false, they really need to evaluate their capacity and capability just like the investor is going to do. Before that investor comes in and does that for them and finds that they're not really ready to grow and scale. So it's not just about getting investment. It's about understanding why you need that investment. Are you ready to take that investment and who is the right source of that funding?  Adam: (06:23) Yeah. Because somebody could come to your startup and say, we're going to give you $2 billion, but if you're not ready to grow, then that $2 billion would just kind of go to waste.  Claire: (06:32) It's going to be a wasted bet on, and both sides are going to be complete failures in that regard, right. Especially if you're talking about an investment to the tune of, you know, a billion dollars or more an investor is not going to do that on a wish and a prayer, they really do need to be very, very thorough in vetting the company they're about to put their money behind. And the company itself has to be really self-aware and disciplined before they take on that level of funding.  Adam: (07:00) So I can imagine that there's going to be mergers and acquisitions that aren't successful. We can, you can read about the famous ones when, I forget which company bought AOL, you know, no one really knows what AOL is anymore. You know, stuff like that. Why do most mergers and acquisitions fail to create value?  Claire: (07:18) Hey, so, you know, in my, in my defense, I still have an AOL email account. it, it's my it's the oldest one I have. And I'm a little bit nostalgic, I guess. So it's, I still use it for personal email, but I digress. Yeah. So Bain and company, it's one of the big, you know, research, houses and they do a lot of work in this space. they put out a global private equity report earlier this year that found that 58% of MNAs fail to create value. And one of the main reasons that they fail is because they over-index on the tangible side, right? They over-index, they over-focus on the due diligence side, the integration side and the management side post-close on those tangible assets that we talked about. And what's interesting is that same study by Bain found that the number one reason deals fail is the quality of the human capital within that portfolio company, specifically the top management team. And so what the sort of the good news about that and I mean, an eternal optimist. So I always look for the silver lining. The good news on that side is that the quality of that top management team, which again, is this combination of their capacity to get to the next level and their capability to, you know, to put the horsepower behind it in terms of depth of talent, et cetera. It's also the number one reason deals succeed. So if you look at that in black and white, if that is the number one variable or wildcard is your human capital on both the failure side, the success side, why wouldn't you spend way more time and attention and effort on evaluating that.  Adam: (08:55) That makes a lot of sense. Do you think that there's an element of the virtual capital? Like the things you can't see, the intangibles, besides the human capital, that could be an element of that, that it's hard to measure that we can't really see.  Claire: (09:10) Yeah. You know, that's, that's always the biggest, I think mental stumbling block when I talk to, you know, folks in the investment community and I say, you really need to spend more, more time and attention measuring and assessing those intangibles. And invariably, they come back to me and they say, okay, that's great. I get that. That's the biggest wildcard I get what Bane is telling us, I get that just from past experience, you know, the, the human behavior, performance capability, capacity, all those things are the biggest wild card. And then the products of that, right? The brand, the ability to innovate, the ability to solve problems, all of those things. but then they follow that up with saying, but they're humans, we can't measure that they're unpredictable, they're total wildcards. And the answer in fact is you can measure that there are ways. And in the work that I do, there are, there are tools, there are scientifically validated tools that will measure and assess these things that we're talking about, the capacity, the capability, the mindset, the coachability often, that's a big stumbling block for an investor coming into a company and saying, you got from point A to point B. We want to see if you can get to point C. There are ways to validate before you put your money behind that business. Whether that top management team can actually receive that coaching that advice and change the way that they do things from management by chaos to a more structured way to get to the next level.  Adam: (10:39) So as I'm kind of thinking about how this connects to our audience, you know, the accounting and finance teams, what can they do right when calculating business value, because I'm sure that they'll be integral in calculating the business value when it comes to ventures or IPO's and all that stuff.  Claire: (10:56) Yeah. They are absolutely integral. And I honestly think our friends in finance and accounting have the best opportunity to turn the tide right. To sort of tip the scales away from over indexing on tangible assets and really incorporate into their process, more of an evaluation and valuation of the, of the intangibles. So, you know, how do you do that? Well, instead of just focusing on, you know, quantifying head count, quantifying customers, taking a look at, you know, have they gotten into any legal trouble in the past, you know, counting up all of the widgets and the tangible assets that make up a company, really upskilling, starting a due diligence that, you know, their process for evaluating, the intangible side, which we already know across every industry drives the majority of the business value. So they need to find ways to evaluate that capacity and capability specifically at the top management level. but they also need to evaluate the depth of the talent behind them. And if they do that, if they find ways to do that, or if they find people like me - we are out there - to help them do that. They're going to be able to help their companies invest in the right businesses with far less risk and far more confidence in success.  Adam: (12:19) Are there specific things that they should avoid when doing that valuation? I know you gave some great pointers there, but what are some steps that they should really avoid or some, some red flags they should look out for?  Claire: (12:29) Yeah. so it's interesting that you say red flags. So I, in the work that I've done, in some of the valuations that I've done for investors, and even on the, on the, on the company side, I have a, sort of a framework that I use and I put together a checklist that I can give your audience, the link to, they can go out and in, in grab it, but it's a great way for companies and investors to, sort of do a self-check on it. It basically comprises the 11 dimensions that drive performance and profitability. So the checklist kind of takes you through each of those 11, and you can sort of self-assess on the company side, or as the investor looking into a prospective company, you know, just sort of rate those things, following the checklist and what it will yield for you is it will help you identify what are my top three profit levers, right? So what are the three dimensions that we have that we have in spades that are competitive advantages for us, that if we put the right horsepower, the right attention behind it, they can really drive the business forward. And conversely, it will help you uncover what are the top three risk flags, red flags, potential derailers that could sink your business. And so investors have used that checklist, yes, for the profit levers, but more specifically to say, are there any answers in here that are deal-breakers that if we knew this upfront, if we paid some attention to this and follow this checklist would make us walk away. So it's really, really important from, from both sides. One to help you press your advantage and play to your strengths, and also to make sure that you go in with eyes wide open and verify before you buy.  Adam: (14:12) Yeah. Verify before you buy is I think it's something that we all should keep in mind no matter what you're doing for sure.  Claire: (14:19) Yeah. Yeah.  Adam: (14:20) Well, Claire, I really appreciate you coming on our podcast today for sharing your insight. I know that our audience will be really be greatly receptive to it.  Claire: (14:30) Well, it's my absolute pleasure. if anyone in your audience does want to grab that checklist, they can go to my website. It's talentboost.net/checklist is the fastest way to get to that checklist. Otherwise, if you just go to talentboost.net, there's a button at the top click on checklist. and as you kind of go through the checklist, if you have any other questions you want to reach out and talk specifically about where you are in your business, has somebody like me can help you get ready for your next level. Go to the top of that same page. There's a big button that says, book a call, click that button, pick a time and let's chat.  Closing: (15:07) This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Sarah Hoxie: https://www.linkedin.com/in/sarah-hoxie-38b54133/FULL EPISODE TRANSCRIPTMitch: (00:05)Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host Mitch Roshong, and I'm here to preview episode 144 of our series. Today's featured guest speaker is Sarah Hoxie. Sarah is the Chief Accounting Officer at LSC Communications. In this role, she is responsible for all aspects of accounting and has overseen various projects impacting the organization. Throughout this episode, Sarah talks about her experience with business transformation projects and focuses on the people involved. Transformations can greatly affect culture, and Sarah explains how to best manage that. So keep listening as we head over to the conversation now. Adam: (00:54)Sarah, thanks so much for coming on the podcast today. And our focus today is going to be around business transformation. And so just to kind of start off, what is your take on business transformation?  Sarah: (01:05)So in my opinion, you know, business transformation, isn't a straight line journey. It's not a matter of starting at, you know, "A" and working your way to "Z", and then, and then you're done. It's really about, you know, looking at the opportunities that are out there in the environment, and adapting to those, whether it's, you know, social, economic, environmental, they're all things that need to be considered. And as you're on that journey, incorporating them as, as they change. You know, in my experience, it's a lot of business transformation is about making the business or making your area of the company continue to remain, you know, relevant and I think the scope can be, you know, as narrow or as broad as, as needed, you know, I think you see a lot of companies that do business transformation well, look at all levels of a business and they never stopped looking for the changes that are out there. Adam: (02:08)So when we look at business transformation, what approach do you take when you're leading a transformation? Sarah: (02:15)I think the first thing that I really focus on is his tone at the top. I think to get everyone in a part of the business or even the whole company engaged in business transformation, they need to view it as a priority from the leaders of the, of the business. And I think it should, you know, my approach has been to involve all levels of the organization, right from, you know, people that have just joined the company or your interns, you know, right through people that are, you know, more senior in individuals, and getting their input. I think they have got to be helping drive some of the, the change, help identify, what the issues are, what the problems are, and then work together to find solutions for them. I think when you get all levels of the business, working behind this kind of transformation, it really does drive better solutions. You've got people that are doing some of the things on a day-to-day basis that can see how they can resolve the issues are they know what the issue is, and maybe don't know how to resolve it, but if you get everyone involved, then all those ideas are coming together and everyone's working towards them. I think another key piece of it is really accountability. Once you have that tone at the top set, and, you know, people are right behind that, then, you know, you can start to encourage everyone to be accountable for the areas they're getting involved in. From an accountabilities perspective, tracking some of the progress on the areas of transformation is really helpful as well, because, you know, if you're three months into this kind of process and you can precisely communicate to everyone, the progress that has been made, you know, and you're doing that through being able to track the progress, it starts to build the momentum for everyone to really get behind, the project. But, you know, it's in, you know, in the organizations I've been with it's, the tracking can take over. You really want something that's simple. That's not taking time away from the actual transformation activity. It kind of going back to what I was saying about getting all levels involved. I think if you're going to get true business transformation, you really need to give people a, you know, a lot of free reign to come up with those ideas. You know, don't set kind of restraints on projects or ideas that can be investigated. And I think that's, that's where I've had the most success when you've really given people a, you know, a free range, maybe hold up a brainstorming session to identify all potential suggestions of how we can do transformation out there and then start to investigate them rather than, you know, giving very tight restrictions on what can be proposed. That's something else that I've seen work well is not losing track of ideas and suggestions that don't necessarily make sense today, but may make sense in the future. Keeping an eye on those is always helpful because you know, the world is continually changing and that that idea or suggestion might be a great in, you know, two or three years time. Adam: (05:47)It almost sounds like you're referring to like a cultural shift within an organization, where, you know, you're changing the tone at the top and you're listening to ideas, even writing them down and keeping them for two to three years, maybe because that idea may be different later. How would you execute like a cultural shift in an organization to make sure that the transformation is successful? Sarah: (06:07)When you think about making it stick? It has to be something that continually comes up in everyone's day to day activities. It's not something that just people focus on for a month and that it's never mentioned again. It's, you know, really keeping it in the forefront of everyone's mind, even if it's small, day-to-day kind of, activities, really, you know, any chance of, you know, small meetings as a team or a larger kind of town halls, really having it as an agenda item that people talk about, that people celebrate. Some of my teams have had a great success in that. And, you know, there's been, you know, recognition and reward for those kinds of, activities, which then starts to drive more, more change within the organization. Adam: (07:05)That makes complete sense. But then how do you avoid people from falling back into the old habits? Because, you know, you can, put it in front of people's faces, but then over time, you know, it's easy to go backwards. Sarah: (07:18)Yeah. Absolutely true. And I think it's very easy when individuals are not seeing the, kind of the fruits of their labors, right. If they don't understand what impact their projects or their involvement is having in, driving change or maybe improving results, then it's very easy to slip back. So the more that businesses and groups can communicate successes, I think it's easier to stop them falling back into the old habits, you know, and I think it's listening to all viewpoints within an organization as well. People that have been with organizations a long time, have a very different viewpoint, than people who, you know, have only been with the company a short period of time. I think it's making both of those groups feel like their thoughts are, and input is valued. You know, people that have been with the organization, you know, a longer time may think, oh, we tried this, it didn't work. and so a lot of it is encouraging those individuals to, you know, be more open to trying again, but also listening to them and say, Hey, why didn't this work previously and trying to learn from those mistakes as well? Adam: (08:44)Yeah. It's almost like the people who've been there a long time have that kind of jaded view and the people who are new may have a fresh, exciting view. And it's bringing those two together, finding that in-between to where, where can we meet in the middle to asking the right questions of the jaded view and then asking the right questions of the person who's never seen it before. Sarah: (09:03)Absolutely. Cause I think you don't want to just dismiss the, you know, the views of people that have been there a long time. There's a lot to learn from them, especially from, you know, not making the same mistakes, but you know, it is a matter of meeting in the, in the middle with it and making sure that, you know, team leaders are all focused on it. I think, you know, it's very easy for an individual team to fall back in all ways if the leadership of that team, it doesn't feel like the project's worthwhile. Adam: (09:35)So what stage of the journey would you find, would you find most businesses today? Would you say most businesses are today in the business transformation journey? Sarah: (09:45)I think it depends on a couple of factors for each individual company. You know, I think it's that where they are in the life cycle of the kind of that company, the industry, that the leadership, but I do think COVID-19 is definitely making more companies focus on transformation, in order to, you know, either to survive or continue to thrive. It's really, you know, pushing the point and making people, focus on transformation maybe earlier than they would have done. You know, I will say from experience, I don't think there should, you know, if, if leaders are debating about whether to, you know, start down a route of business transformation, don't delay it, it really is something. If you're thinking about it, it's probably something you should be starting to do today. And I think, you know, once, once you start to embed a business transformation culture into a company, then it does, it's something that, you know, becomes more natural. It's not something that you tend to focus on necessarily specifically. It just starts to come naturally and, and starts to be, you know, always part of what everyone does. Adam: (11:06)So as we wrap up our conversation, is there anything that you would want our listeners to kind of take away, as they're thinking about their own businesses transformation, thinking of the future of finance and accounting, what does that look like for them as they look today? Sarah: (11:22)Yeah, probably from a finance and accounting perspective. I think there's definitely a lot that can be done around taking out the noise from like the month end, close process, really focused on things that are, you know, very straightforward every month and looking at ways to reduce the time spent in those areas, whether it's making the process simpler for someone to do, or, you know, implementing some RPA, to, to make it, an automated process. But when you start getting, finance and accounting team to thinking that way, what can they take off their plates? That's very straightforward. What can they, that then gives them time to do some of the more interesting factor, you know, aspects of, accounting and finance, get involved in more one-off projects and that really then helps motivate, and develop staff. So it's kind of a, you know, has two great points there in terms of reducing the time, spent at month-end close, as well as you know, that development and encouragement that the staff, as you try and retain them in what is a very difficult employment world at the moment, as people try and retain staff or attract staff. Closing: (12:52)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org

Contact Michael Schmit: https://www.linkedin.com/in/michael-schmit-cpa-cia-ca-cgma-8350545/Michael's Profile Magazine Article: https://profilemagazine.com/2020/michael-schmit-swm-international/FULL EPISODE TRANSCRIPTAdam: (00:05) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson. And this is episode 143 of our series. Today's conversation features Michael Schmit, the corporate controller and chief accounting officer of SWM. The accounting team at SWM has been going through a business transformation, including the implementation of RPA, improved operational analytics and several process improvements to meet the needs of the growing business. And Michael has been the leader of these efforts. In this episode, he discusses the importance of identifying the company's why when considering a transformation and the role of technology in the process, keep listening as we head over to hear more now.   Mitch: (00:51) So business transformation is not really new when it comes to accounting and finance, but the systems, the processes, the things that are being transformed have certainly evolved. So what has accounting transformation looked like at SWM and how does that compare to previous transformation projects or other things you've seen evolve in your experiences?   Michael: (01:11) Yeah, I think that accounting and finance really isn't new, but I think the why we're doing this and the, how we'll achieve this, really has been continuing to evolve, to ensure that we're meeting customer's needs. For instance, the SWM, our accounting business transformation is really following our overall company's business transformation. SWM's has been growing at an accelerated pace, both organically and through acquisition in the last year and a half or the last, I guess two and a half years since I've been here, we've actually grown from about a billion in revenue and 22 production facilities in eight countries to now 1.5 billion in revenue with 36 production facilities in 11 countries. And now we operate in over 90 countries. So we've been really focused on integrating our acquisitions while transforming our own accounting processes, leveraging best practices from companies we've acquired as well as adding new technologies along the way. So our why wasn't to, just, you know, cut costs. It was to obtain synergies from the business, but also improve on kind of our status quo and, add more value from our roles as accountants. The vision for the accounting organization here is to operate as one team and one company to support our company's vision, their knowledge sharing and process improvements and leveraging technologies to execute world-class business partnering and fiduciary excellence. And so all those things are kind of leading the transformation and, you know, we see the fiduciary excellence piece as the absolute minimum expectation. Yeah. That includes complying with all laws and regulations, and to do that as efficiently as possible, but then also business partnering, which is partnering with companies' leadership and management, each other on our teams, and also other groups to provide actionable, insightful reporting to assist in decision-making to achieve the company's vision. So in other words, taking the rear view kind of near view of driving down the road and focus more on what's coming on the windshield and in the future of the road ahead. So this is different than past transformations, I was involved with in other companies, cause I think the why was really always focused on how do we lower costs and the, how was we're going to offshore it to a lower cost place like the Philippines or India. You know, sometimes robotics were in there as well, but really that's the main difference I see.   Mitch: (03:47) We'll get back to the specific, why at SWM and some of the goals and, you know, progress that you've seen in just a minute, we'll go to that. But I first want to, you know, take a step back. You mentioned business partnering another term that's, you know, again, not new, but it's definitely more prominent, I think these days when it comes to accounting and finance. This whole conversation has a lot to do with the future of work. And that's another hot topic, a phrase that is getting thrown around a lot. So before we really dive into what all of this means and the connection between the future of work transformation, business partnering, I'm curious what you think about the future of work. How do you define it? What are some of the main considerations are really, you know, why listeners should be aware of what's going on when people talk about the future of work?   Michael: (04:33) Yeah, to me, the future of work really boils down to value creation. In other words, how can we as accounting professionals add more value beyond what we have done historically and what can now frankly, be done at lower rates in other countries, or be replaced by technology? You know, we're evolving from the history of being just scorekeepers to being trusted business partners. And that is someone that's going to provide those insights to help drive decisions of the business. And, you know, the rate of change now is greater than it's ever been in most industries and it's going to continue to increase. So as accountants, we have to be better prepared to change and help our businesses succeed in this. So we need to be able to evolve ourselves and improve at least at the speed of our business. And why should your listeners be, you know, interested in that, frankly, so they don't get left behind. I mean, I literally, you know, having their roles outsourced overseas or replaced by technology accountants today really must focus on continuing to develop their own business skills and be able to articulate the value they're bringing to the business above, you know, debits and credits and internal controls. That's just not good enough anymore and won't be in the future.   Mitch: (05:56) So that's a great point. And we have a lot of conversations about this and the need for upskilling, reskilling, and technology is a big part of that. And we'll get to technology coming up next, but to connect the dots in our conversations so far, the accounting transformation that you talked about, the specific why at SWM other initiatives, how is that preparing you and your team for this future of work?   Michael: (06:23) You know, we're, we're focusing on, just business driven value, integrators, predictive insights, how to help the future of our enterprise, not just the enterprise today, but also getting the basics and fiduciary portion of our jobs done efficiently and effectively, leveraging technologies. We'll talk more about RPAs and advanced analytics, automated AP online account reconciliations, all those things. A great recent example has been during the COVID-19 pandemic when the world was hit in 2020, suddenly we had our a hundred plus accountants worldwide, all working from home. Luckily we had already started our journey and we'd implemented BlackLine systems, which is an online task management tool and account reconciliation tool at most of our locations. So this it's a cloud-based tool that you can really access from any browser and it's connected automatically to our GL and subledgers. So we were able to prepare, close and prepare our account recs and seamlessly, and it didn't really impact our Sox controls, internal controls. So our internal auditors and external auditors were able to audit and we were able to meet all our deadlines while other companies might have been struggling to kind of change things and have special actions taken during COVID-19. We were already prepared in that front. Similarly, on the AP side, we had implemented, automated AP software system called medias flow, where a lot of our vendors automatically are emailing or sending invoices to that. And then the entire delegation of authority is built in with them there. So, you know, whether it comes to me or our CFO or CEO, we can review the invoice online, whether it's a iPad phone, computer, whatever, and we can make sure that that gets approved appropriately once good controls. So those are great examples of things we've implemented to sort of make the blocking and tackling if you will easier. but really saved us during the pandemic. And so we weren't really behind the eight ball. We were kind of business as usual and, felt that gave us an advantage. You know, we were able to file our SEC filings on time and, you know, get our auditors, everything they needed, the board was happy and still, we executed two acquisitions during the pandemic where other companies were trying to figure out how to, you know, just do the basic internal controls. So I think that really gave us a competitive advantage.   Mitch: (09:06) Those certainly are great examples and it's great progress and a difficult time for many. I also appreciate the football reference with blocking and tackling. I can always relate to that. So good analogy there. And, you know, behind all of this, you, you started it off and talked about it a little bit, obviously the main driver behind transformation, the preparation and everything that goes into the future of work, what you were able to accomplish it's technology. And it talked a little bit about the technological advancements you've invested in you've implemented and some of the, the improvements or the capabilities that were there because of it. Can you take it a step further though, and talk a little bit about some of the benefits, the rewards, as opposed to just, you know, being able to do your business like you were talking about in a difficult time, how has technology enabled you to take a step further as well?   Michael: (09:54) You know, in addition to, you know, black, white, and medias, I mentioned the RPAs, which is robotic process automation. And what that really is, is something that is a computer software package that can mimic human behavior. So it can log in to various systems. You can give the RPA, it's an email. you can have it as long as it's kind of repeatable tasks, it can take data and manipulate it and put it in other places. So a good recent example of that was something actually we implemented during the pandemic. We used sold kind of like this on a Skype call and it all set up. And, we were able to kind of take this program rule-based tasks and eliminate non repetitive, or non value, repetitive manual work in the process. For instance, we had a controller that was spending a day during the close process, taking manufacturing, variances, and certain employee costs and allocating them to multiple sites to multiple product families and product lines. And this required downloads from lots of systems, data manipulation, and literally hundreds of uploads journal entries. So we were able to build an RPA that now does that in the background in about an hour's time. And so while that's happening, that same controller is now spending that time on analytics and helping kind of get data more quickly to the FP&A team, to the leadership team, to operations, to make better decisions quicker. So really he's not working late hours, just closing the books. The data is also happening, and we're seeing the benefits of that, you know, already, you know, other things, other tools, one stream as our consolidation tool, which is, some of your listeners may be familiar with like, Hyperion. And those are pretty common now with large multinational companies, but for a company like us, we're doing acquisitions and there's multiple ERPs. Just, the ability to consolidate quickly pull that in and be in our SEC deadlines. And, you know, we've implemented at least accelerator, which is a ASC 842, solution. And that helped us, you know, we've just bought some companies overseas who had never had to do that before. So inputting that in quickly within the quarter of being able to get them their journal entries, Workiva W-desk for the filings, and then for analytics, we're using Altryx and I've used Tableau in the past as well. And we're continuing to kind of find new ways to use that, to help drive better decisions as well.   Mitch: (12:40) So let's talk about all this a little bit more, you know, he just brought in analytics and obviously that's a key part of it. Technology, the driver behind a lot of the data that's available, as you mentioned. So you've obviously had great success. You've seen the benefits of this transformation and the use of technology. How do you recommend going about it? You know, maybe our listeners aren't working for these multinationals, these big companies that already have this in place. Maybe it's part of a transformation project they're planning, what are some of the best practices or, you know, step-by-step things that they can consider, in order to improve their accounting or finance functions?   Michael: (13:17) Sure. I would, you know, I'd say one thing is don't try to do too much too quickly, and there's going to be plenty of salespeople, vendors, consultants, who are ready to sell you technology with lots of promises that are going to fix problems you didn't even know you had. So I would say don't look for a problem to leverage this cold technology for make sure you're actually have something that is going to add value to the organization by you implementing this, do your homework, make sure there's really real value for you. For instance, if you're at a small company, you may not need an automated AP system. You know what I mean? You may have a small number. It may not be a ton of value there to implement this, or there may be a lower cost provider of some of these things online that, you know, larger companies might not look at so that won't stop vendors and consultants trying to sell you these things that you may not need. But, you know, I'd always say always start small, you know, run a pilot, a proof of concept. So let's say you think there really is value in implementing automated account reconciliation software. There's Trintech, there's Blackline there's others. I mean, I personally like BlackLine, used it at a couple of companies, but, it's very, you know, it's not cheap, it's expensive technology. So you may not need all the bells and whistles of a Blackline at a smaller company. You may not have, you know, multiple locations, multiple locations that in different countries where there may be a lower price that does everything you need. So, you know, do a pilot, do a small taste, try. And if you can, if you can afford it, I would always suggest using an implementation partner, the consultant that, has done this many times before, and maybe, also using a third-party to help kind of evaluate different vendors, because there are lots of products out there for the different, whether it's AP, whether it's RPA, whether it's analytics, there's tons of solutions. And I can't say one better than another because they're better in different situations and for different companies. So, you know, we've chosen the ones that were good for our company for various reasons, but there may be a different solution for you. So that gets back to doing your homework. So all those things, and then finally don't underestimate what it takes to make these changes. You know, you can't do it alone. accountants, sometimes aren't always the ones to get up out of their desk and partner with other people in the business, hopefully nowadays most do, but you have to work with IT. If it's an AP automation, you have to work with purchasing, you know, you can't, you can't do this in a box or you're going to fail, you know, or you're going to implement this great system and no one's going to use it. So, I think that's, it don't underestimate and bring in all those key stakeholders that, are going to be impacted by the technology.   Mitch: (16:24) That's a great recommendation, good suggestions. And I really like how everything you're sharing ties back to, you know, the individual, why or the individual is the individual, the department, the company, whatever, but it's all about what, why, you know, the value to you. So, I appreciate you sharing all that, all those steps. The last question I have for you, if it's all right. And, I like to ask this question when we're talking about transformation, the future of work, things like that, obviously nobody has a crystal ball, but it's nice to kind of think about what may be coming down the road next. Right. So when it comes to the future of work, in the role of the accountant, or, you know, the finance function, what do you predict is going to happen? You know, you talked a little bit about how transformation has changed a little bit because of different things that happen in, you know, in the industry, but what else do you think our listeners should be keeping an eye out for in the future?   Michael: (17:21) Yeah. And you know, I have thoughts on this and I would say it's probably not going to be a tidal wave of all these things happening at once. It'll happen more quickly, I think for the larger multinational companies. But you know, some of these changes may not impact, the smaller, single owner companies and things like that for quite a while. But overall, I see, you know, robotic process automation, mimicking of human actual become cheaper and more easily available. They'll just become commonplace. So that gets back to learning more valuable skillsets for the future accountants. And then as artificial intelligence continues to advance, I think especially in the businesses that can afford it and that can gain the most value from it will continue to adopt things like cognitive optimization, automation, sorry, and, and cognitive engagement is coming, which will augment human judgment, human intelligence. So utilize machine learning, ultimately predictive decision-making and, natural engagement with humans. It'll be, you know, like the robo calls we get that'll turn into business. I think in our lifetime, probably sooner than we realize eventually we'll have, AI in our ERPs. And then our other tools, I think this'll, like I mentioned, mimic human intelligence and eventually completely replicate interactions and possibly even make decisions. So we all have to stand in front of that. You know, I think our government and agencies, our auditors and others will continue to use these tools for their own use. And there'll be more continuing monitor continual monitoring of financial activities, and of accounting. And you know, like I said, it'll eventually trickle down to the smaller businesses, but I think kind of the large multinationals will probably be hit first by the auditors and government and they better stay in front of it in themselves too. So, that's how I see. And I think some of that's already happening, you know, and I just think it's going to be next five, 10 years, not, you know, 50 years.   Closing: (19:35) This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

About Sylvana Caloni: https://sylvanacaloni.com/about-me/Humble Crumbles: Savouring the crumbs of wisdom from the rise and fall of Humble Pie: https://sylvanacaloni.com/humble-crumbles/ https://www.amazon.com/HUMBLE-CRUMBLES-Savouring-crumbs-wisdom/dp/1916328571/ https://sylvanacaloni.com/book-reviews/ https://sylvanacaloni.com/testimonials-2/ FULL EPISODE TRANSCRIPTMitch: (00:05) Welcome back to count me in, IMA's podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong and today you will hear from Sylvana Caloni, as she joins us for episode 142 of our series. Sylvana is a former equities fund manager, a professional certified coach and author of the book, Humble Crumbles. She was an executive vice president when she was privileged to partner with an executive coach. She is now a leadership consultant committed to paying it forward by enabling clients to make an impact at their companies and in their communities. In this conversation, you will hear Sylvana discuss the value of failure, the benefits of clear communication and ways to propel business. Let's head over and listen to her now.   Adam: (00:57) Sylvana, I just want to thank you so much for coming on the count me in podcast today.   Sylvana: (01:01) Thank you, Adam. I really appreciate the opportunity to speak with you and to explore failure and entrepreneurship and all sorts of different ideas coming from our book, Humble Crumbles.  Adam: (01:13) So speaking of your book, Humble Crumbles, you say in that book, failure has a purpose and failure's a part of the process. So can you just start by giving us some more insight into that statement?   Sylvana: (01:25) Yeah, absolutely. So I guess we see across different cultures and across different types of businesses, if you like and academia, that there is a fear of failure. And we, as individuals often are constrained in what we do because of that fear of failure. It may be so great that we prevent ourselves from jumping in taking the leap and starting up a business, or perhaps we have started the business, but because of that fear of failure and because of a fear of not meeting the commitments we've made to our stakeholders, et cetera, again, it constrains what we can do. So if you look at tech companies, for instance, you'll often hear the phrase fail fast, fail often, or if you look at scientific revolutions and innovations and how things have pivoted during this pandemic, actually, if there had not been failures, there wouldn't have been learning. There wouldn't have been multiple iterations. There wouldn't have been new responses to the challenges that are out there. So for Paul O'Donnell my co-author and I, the idea that failure is part of the process is that we do need to sort of remove ourselves from that view that it's first time only time, and we're going to be successful from the get go, because in fact, most successful businesses have started out in some other form in their initial iterations. And it's the ability of the business owners and entrepreneurs to be flexible and to pivot and, you know, take on constructive criticism or take on impartial advice to modify their product or service, which means that ultimately it is successful.   Adam: (03:15) So when you look at these leaders who are having to transition and fail and become more successful, how do you, you know, how do you understand what makes them tick? What do you, what, what can we do to, to look at these people and see what can, what can cause you to fail and keep coming back and keep coming back?   Sylvana: (03:34) It's a great point that I think one of the key points we're trying to make in Humble Crumbles it's that the failure of the business is often attributed to external factors. So someone will say, well, you know, the economic environment deteriorated or technology changed or legislation was too prohibitive. And that's true. I mean, absolutely there can be external factors that impact the success or failure of a business. But what I found when I was an equity analyst and funds manager, was that more often than not the failure of a business was to do with the owners or the leaders, the management of the companies and the problems I often saw were whether they were not self-aware. So they didn't have a sense of, okay, well what makes me tick? What, what are my drivers? What are my motivations? How do I make sense of my world? And in having that lack of self-awareness, they're not then able to engage successfully with others because they take the view that well, it's my way or the highway, or this is the way the world works. So they don't have an appreciation that their own norms, standards, practices, ways of behaving are not universal. They could differ with other people because other people have different cultural backgrounds, ethnic backgrounds, gender backgrounds, it could be a different set of, drivers within an organization. And if at what we show in the book, Humble Crumbles, and it's full title is Humble Crumbles: Savoring the Crumbs of Wisdom From The Rise and Fall of Humble Pie. We share Paul O'Donnell's story. So Paul is my co-author and Paul like me had come from the financial services world. We had both worked at Bankers Trust. So BT co. Us company. In fact, even though we were both Australians and you can hear that in my accent. So we were working in Bankers Trust in Sydney, Australia, and Paul eventually left BT and started up a couple of his own businesses. So he's a serial entrepreneur and his first couple of businesses were in what you might call financial adjacent. So they were similar types of businesses, you know, financial advisory or publishing a financial material, fundraising, that type of thing. And then he wanted to go into a business that was more real in the sense of making something so humble pie was a business that manufactured pies for the retail sector. And then ultimately also he got into wholesale. So it was, it was pies that we eat sweet and savory pies that we eat. And he came from that financial services background with the number of ways of seeing the world behaving and business traditions, if you like, or business practices that certainly worked for him, but there were others that were more relevant to financial services, but not so much to a factory where he had people in the factory kitchen making the pies or sweeping the floors or delivering the pies to the shops, et cetera. So what we found Paul was blindsided in that he just assumed for instance, that the factory workers would, like him, have a view around equity as a way of incentivizing behavior or around bonuses as a way of, you know, promoting work, et cetera. Whereas these people had different concerns, different cares, you know, for them the weekly pay pack. It was what was really important, not some notion of equity or a bonus at the end of the year. So the blind sidedness or the lack of Paul's self-awareness, which he courageously, I have to say. I mean, he fesses up basically in the book and looks at some of the errors he made with. I think, I think he's very generous and very courageous in doing that because what he's doing is he's demonstrating how sometimes the very things that we think are our strengths, if taken to an extreme can actually turn into a weakness or can turn into a vulnerability in a negative sense.   Adam: (08:00) That almost makes me think of too much of a good thing, becomes a bad thing when you say that.   Sylvana: (08:06) Absolutely. Absolutely. And to your point earlier, and I guess I went a little off base, but you're asking me, how do we know if managers or leaders are likely to have failures or create phase? And my point about the self-awareness was that often what I would see when I was an equity analyst is when a manager or leader of a company got onto the front pages of Newsweek business week, wall street journal, quite frequently, thereafter, the company would go down the tubes or at least would not do as well. And that was because those leaders were very egocentric. They were very much about, you know, puffing their own chests and they weren't necessarily engaged with their own teams and succession plans and understanding the different communication styles or the different working styles, or, you know, what were the values of the firm? How did the employees feel aligned with the firm, et cetera? So where there is a high likelihood of failure, because as I say, the leader or the business owner, the entrepreneur isn't sufficiently self-aware to know that his or her way of seeing the world is not universal. Other people respond differently. Other people have different standards, different norms, different practices.   Adam: (09:29) That's really interesting that you say that, there's even in the sporting world, there's a video game called Madden and the person who would be highlighted each year, the next year after they were highlighted on the cover of that one would have a very bad year as in terms of their performance in the game. And I wonder if it's that same kind of, thing that you're mentioning about that, where they're so focused on themselves that they lose sight on what they're supposed to be doing from day to day. And that, that self-awareness.   Sylvana: (09:57) Yeah, I think so. And sometimes they can generate a sort of a false sense of security or a complacency actually, often you find that people become, and we mentioned it earlier about too much of a good thing. Sometimes people become so confident in their strengths that they just think they're infallible, you know, that they walk on water or that, that particular way they've done something works in all situations. But again, going back to that key point of self-awareness, if you're self aware, you'll recognize that the model you use or the way you solve a problem is relevant to a specific set of circumstances and may not be relevant across the board. And if you are self-aware, you're more likely then to be curious and ask other people, well, how do you see it? You know, how would you approach this problem? What am I missing out on? Where am I blind here? You know, I've been successful in this thing before, but tell me what you think might be different this time around. And, in fact, that's another point we make frequently in the book, Humble Crumbles is that, you know, for you to succeed, you need, you, you clearly need conviction. You know, entrepreneurs believe their stuff, right? They believe that their product or service is going to solve a problem that exists out there, and they can become again, too much of a good thing in that they can become so stubborn about that idea, that they don't do the testing, learning, and tweaking, or the, you know, the shifting in, well, how could this product be better? Or how could this service not be working here? You know, what are the nuances of this particular market or this sub segment of the market? So that idea of continually testing and tweaking, being curious, asking for impartial advice, not being offended, if someone sort of mentioned to you that there's some aspect of your product or service that, you know, just doesn't work or it's complicated, or, you know, doesn't really meet the demand.   Adam: (12:06) So it's almost like I hear you saying that, like, things like clear communication and connections are like a very essential part of business. So how can you like nurture your network to make sure that you have those people that you can have those almost fierce conversations with to, to be brutally honest, to help your business succeed and go further?   Sylvana: (12:25) Yeah, absolutely. That's, that's a great point. So the networks are really critical and, you know, often people talk about someone's who self-made millionaire or a self-made entrepreneur, or self-made something else. And I get that point to the extent that they may not have inherited their business or, or whatever the successes they're millions, but they're not self-made in the sense that they don't do it on their own. Nobody does things on their own. They will have been someone who's advised them, someone who's supported them, someone who's championed them, or for that matter, there may be someone who's been an obstacle who's criticized. And, you know, sometimes we hear of great leaders or great entrepreneurs who sort of had a grudge match as it were, it was a teacher, maybe in their youth or a, you know, a stern dad or someone who sort of told them that they were never going to succeed. So they went out of their way to prove them wrong. And that gives them the catalyst or the impetus to go out and, you know, keep working at it and improving the product or service. And as you say, you need a network, you need to cultivate a network. And I mean, that from a positive sense, I don't mean it from an manipulative sense, but ideally what you would do within your network is it you'd go out and find people who sure, are like you, because it's easier to communicate with people who have a similar view of the world or a similar sense of values or similar things that they're passionate about, but you also want to find the naysayers or the people who have very different lived experiences from you, because that will actually help you in terms of testing your idea and testing your blind spots and helping you with risk. Because if you're only mixing with the people who had the same ideas as you, then you're like, it's like group think, right? The financial crisis of 2008, 2007, 8, 9, to me, a large part of that was everybody was on the same merry-go-round and people weren't listening to the signs that things were going astray. And there were too many yes people. So the idea of cultivating a network and making sure that you find people who are very different from you and have very different lived experiences, I think is critical to success and minimizing failure, or more importantly, finding that failure much sooner, because you can, you can rebound if you like from a smaller failure, like a series of small failures, rather than a massive failure, you know, where you put your house at risk or you've put your business completely at risk.   Adam: (15:07) So I have to ask, was Paul able to rebound from his failure in his blind spots, in the factory floor?   Sylvana: (15:16) Yes and no, I mean, I guess in some cases it's tough when your business fails. I mean, we can't take away from it. It, it, you know, it does deflate your sense of self-worth or your sense of what you can do next. What I'd say has been a real strength for him in a real rebounding is that he purposely used those experiences to share his story and then write this book. And in this book, we do a sort of, he says, she says, in a way, so Paul narrates the story from A-Z or soup to nuts to some of your compatriots might say. So he gives that story of starting up this business from having previously a financial services background to moving into the retail pie, making business. And then he, through sharing those experiences starts to eliminate or reveal some of those blind spots. And then I use my lens of both that equity analysts background, and also the coach and mentor to dig a little bit deeper. One of the examples we use is that, you know, clearly Paul could do spreadsheets. In fact, he had amazing spreadsheets. He did the three scenarios of positive, negative, and neutral. What he wasn't aware of was that he has a tendency to be incredibly positive. He's always looking on the bright side and, you know, as a previous salesman, he has what some people might call happy years. So even when he did his spreadsheets, the negative scenario, frankly, was still very positive. You know? So the sales that he had projected even in negative or neutral environments were still overly optimistic. And so again, that opportunity to dig deep and start to notice, okay, so frankly, I'm always positive. So who could I go to? Who could I ask? Where could I get some impartial advice or a different set of eyes to look over my plans, to look over my assumptions, to sort of poke holes in the argument and not take it as I say, as an offense, or become defensive or become even more convicted in terms of your stubbornness around your idea, but taking it on the chin and sort of thinking, okay, all right, well, what could I do differently? And where might that chink in the armor be?   Adam: (17:41) So as we wrap up our conversation, I wanted to come back to that word failure. It's clear that you embrace that word. So can we just talk about why should we not be scared to fail? And, you know, what are some things we can learn from it? And, you know, cause there's gotta be some positives in the actual failure.   Sylvana: (17:58) Yeah, absolutely. And, and so I personally call myself a recovering perfectionist. So I'm someone that historically would have, you know, revised a piece of work 12 times, you know, wouldn't have wanted to put out something that had typos in it, or wouldn't want to lead a group until I had the argument inside out upside down, and I was the expert, et cetera. But what I've found is that if you look again at some of the greatest successes, be it in science or in business, they often did start from what were failures or from an idea that didn't reach its completion in its first iteration. So the thing about failure is if you start to see failure as just part of the process, it's, you know, part of the, the tweaking and the finessing, if you like of the idea, it's just, it comes with the territory there. If you look at Netflix, Netflix, these days is so phenomenally successful, you know, the pandemic obviously has helped. And people being glued to box sets has definitely been a positive for them, but Netflix in its current iteration is not how it started out and its founders and CEO's and management. We're able, again, to tweak, we're able to take advice or at least test the market and make adjustments, modifications, et cetera. So if we can look at failure as part of the process and the more we fail in a managed sense, right? So again, not put the whole house at risk, but you know, grow our capacity, grow our comfort zone and take it on the chin. Then we're more likely to have longer, longer success down the track. And we go to build in, in ourselves and in our businesses, a resilience that you don't have if you always been successful. You know, if you see that with university students, for instance, Paul and I mentor a number of students at entrepreneurial schools or in entrepreneurship, and they may be a star students and they're so frightened of not getting it right. That again, they don't get out of their comfort zone. They don't have resilience. So learning to take small steps coming back from the failure learning well, okay, so I didn't get it right. What could I have done differently? What have, what do I now see was the thing I missed out on? Or what do I now have experience on, or who could I go to, who can give me a different set of eyes that builds resilience that builds a new way of adapting.   Adam: (20:50) It sounds like it does. And you know, you mentioned Netflix was able to adapt itself. And then you think of the opposite of Netflix, which is blockbuster, which didn't adapt itself and ended up not being able to continue or redevelop into a new company.   Sylvana: (21:03) Yeah, absolutely. And see to me, and it's, again, something we speak about in the book is that, you know, being a successful entrepreneur or business person is about managing opposites in some ways, right? Because you have to have conviction, you have to have a sense of competence in the idea. So in a way you're stubborn, but you can't be so stubborn that you're blind and that you don't take on new information or you don't take on legitimate concerns or things that people point out to you. So it's that balancing if you like of, yes, I have conviction, so I'm not going to be swayed from my idea just from, you know, someone who doesn't believe I can do it because they don't know me very well because they're fearful, you know, they wouldn't put themselves in those shoes versus well, actually what they're pointing out to me has some real legitimacy because they have a different experience. They've seen some risks that I'm not aware of. They have had a similar business or whatever. So again, you, you know, you want to reach for the stars, but keep your feet on the ground. You want to have conviction, but not be stubborn. You want to pivot, but you also wanted to develop more in one line as well. So again, it's balancing those opposites.   Closing: (22:26) This has been count me in IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA’s website at www.imanet.org.

Contact Anders: https://www.linkedin.com/in/andersliulindberg/IMA's Count Me In Ep. 45: Anders Liu-Lindberg - "Insight x Influence = IMPACT": https://podcast.imanet.org/45Additional Resources from Anders: Link to book: https://www.amazon.co.uk/Create-value-Finance-Business-Partner/dp/1724850741 Link to the ebook: https://businesspartneringinstitute.org/research-and-networks/#insights Link to blog: https://www.linkedin.com/in/andersliulindberg/detail/recent-activity/posts/ FULL EPISODE TRANSCRIPTAdam: (00:05) Welcome back to count me in IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson. And this is episode 141 of our series. For today's conversation, we welcome back Anders Liu-Linberg. Anders is an advisor to senior finance and FP&A leaders on how to succeed with business partnering. He is a partner, the chief operating officer and the chief marketing officer for the business partnering Institute. Back in episode 45 of count me in Anders talked about how insight time influence equals impact when it comes to business partnering. In this episode, he focuses on the influence piece of that equation and shares how business professionals can increase their influence across the organization. Keep listening to hear more about business partnering and contributing to overall impact.   Mitch: (00:58) So first Anders, thank you for joining us again in our first podcast episode, I know we really talked about, business partnering at a little bit of a higher level. You know, you gave us your definition of insights, times influence equals impact, and we really appreciated all that information you shared. So we wanted to bring you back and for today's conversation, we really want to dive into the influence piece of that equation and how, developing influence leads to more effective business partnering. So to start off our conversation, you know, as far as influence goes, what is the first step? You know, what does it take to be an influential business leader?   Anders: (01:36) So if you're a finance professional today and you want to influence business leaders, I guess the first simple step that you need to take is to identify who are those business leaders that you're most likely to be supporting, because that are always clear to people, right? So who is, who's my stakeholder, who is this person or these few people that I need to influence? I think that's, that's really step number one. And then step number two, once you have intensified them is really to reach out to them and say, Hey, you know, I used to work in accounting and finance, and now when I get closer to the business and, you know, help you drive your agenda, can we have a talk about what you're doing and how it can maybe help, right? So then you can have the first conversation and of course, then you build on it from there, but at two steps, identify and engage and then, you know, we can get it into the more details.   Mitch: (02:33) And then the business leaders that you work with, they're not always just interested in data and reports, right? There's a little bit more of a relationship, I think that has to be built, especially when we talk about business partnering. So as far as influence, how can I become part of the team?   Anders: (02:49) Yeah. So, so key for someone to send to you is obviously that they trust you and in any kind of human relation, you know, we want to get to know people before we start to trust in them, of course, from a finance and accounting perspective, we come often with the numbers and with the data and, you know, the foundation is that they can trust those, right? If our accounting is not working so well and the numbers keep changing, I mean, we need to fix that foundation first because otherwise there's not going to be any trust. The second bit is then to develop the interpersonal trust and build the relationship that can best too, by spending as much time as possible with your stakeholders. So today many finance teams, you know, they sit on their own floor in the building and they sit together and they do finance stuff. But if you want to build relationships with business leaders, you got to get out from that cubicle and move your desk and your chair down to those people you want to support and sit with them, if not for a full week, then at least three to four days a week. And then maybe you can one day finance because that's the best way to build trust, to be around them, you know, have the coffee side chat and all those small info and sometimes follow up is that we need to do, because that's how you get to know people. And if you don't know people, they probably don't trust you either.   Mitch: (04:09) That's a great point. And it is a lot of times I feel some of those more casual conversations as well, where you kind of learn about each other. So putting yourself out there and kind of forcing that opportunity, I think is a great recommendation, kind of building on this, you know, a little bit more, as far as the steps, is there a proven structure, you know, that could help me to really start influencing these business leaders and the decision-making, you know, beyond the relationships. Now let's get back into the business a little bit.   Anders: (04:36) Yeah. So we generally have like a three-step process you could follow. The first step is what we already talked about is to identify your stakeholders or the business leaders that you want to support. And then do a small, let's say a desktop, a biography of analysis and say, how strong is my current relationship with these stakeholders? How much influence do they have in decision making? And what are the currently thinking about, right? Because then you sort of know, you know, that the important ones where the relationship is maybe not so strong and then maybe they don't have such a good impression of you. That's where you need to start to identify the person and say, Hey, I want to sit down, have a lunch or talk with you. So at that talk with our coffee or lunch, or virtual, whatever it might be, you sit down and talk about three things, introduce yourselves if you haven't done that already talk about how their business is going and then, you know, get an idea about what do they think about finances right now, because that tells you one of their priorities and what do they think if you. Then you had, when you've had that talk would be half an hour, an hour, it doesn't have to be long. Then you go back to them and say, thanks for having that chat with me. Now, I know more about your, let's say your top three priorities. Now I want to try to help you. So, can we discuss how it can be a part of that? And so maybe they have some priorities. Some are maybe very far out in terms of this transformation or some very customer centric things, but some of it could be very relevant also to finance and accounting to get involved in. So you might pick one of that top roads and say, I'm going to spend some time analyzing the numbers and figuring out, you know, what could be some good insights that can help you make better decisions in this area. So you spend the time, you know, then you sit behind the desk, you do analysis. Maybe we still have to work with data reports and analysis, just not as much as we do today to generate those insights. And once you have looked at it and probably have talked to some of the team members and that the business leaders team and develops a business context around it, you put it on the meeting with the stakeholder, at the meeting, you present your insights and say, here's what I've learned about your situation, your priority. And maybe you even come with some suggestions of how you can move forward, but then you discuss the insights, you discuss some actions and then you take action, right? That's how you really get involved in the decision-making of these senior business leaders. They want you there, you got to bring the right things to the table.   Mitch: (07:03) And so again, I just want to kind of recap the equation, if you will, that you put out there, insights, times influence equals impact. And I know you were just talking about insights, so tying it all together, a lot of times, as you said, finance professionals have the insights, right? They have the numbers, they have the data, and we're talking today about developing that influence. So even as you follow this proven structure, these three steps that you just summarized for us, I think it's pretty often that you'll see the decisions that are made from your insights are often relayed to you after the fact, right? So a lot of people interested in business partnering, you know, that end piece of the equation, making an impact. They want to get ahead of the curve. They want to be a part of the decisions. So how do I get ahead of that curve and how do I become, somebody who can be consulted for these decisions moving forward?   Anders: (07:54) So I think, I think it's important to state that, you know, Rome wasn't built in a day. So just because you start to come with some great insights, they might say, thank you might have a discussion with you, but there's decisions might still be made behind closed doors with other senior stakeholders, but what's high as you consistently show up with great insights. And you're a great discussion partner and the insights you give these great decisions that leads to great financial outcomes. At the end of the day, the business leaders, they will pull you in more and more. Suddenly, you're not just part of operational discussions where the budget once a year, suddenly you are in part of the strategic discussion to say, what are we going to do in three to five years from now? What do you think business partner and the gold standard of course would be that no business leader would make any important decisions without consulting you the business partner first. But to be honest, I think few people have arrived at this, this stage here. But that's the gold standard you can even go further than, but let's, let's say that for another conversation.   Mitch: (08:58) Okay. That's great. We're again, trying to go full circle here with this conversation and business partnering is such an important topic. It has been for a long time, but it's really top of mind for many finance individuals today. So let's just say I'm often involved in these business leaders decisions. Now, you know, once the decision is made, maybe I don't get the progress, the results, right? The what happens afterwards, then what's really my role. How do I continue to maintain and be a part of that conversation?   Anders: (09:28) I think that that's a great point, right? Because we often talk about business partner as a means to making better decisions in the company. But we also know that just because the decision is made, it doesn't mean that action or the right action is taken, or it could even be the right action is taken, but it doesn't lead to the desired outcome. Right? So the execution part of it while the business partner is not out there moving the nuts and bolts of things that needs to be done, he or she can follow up on these things, be the catalyst that ensures action is taken. And then once action is taken, you follow up on the results, did we achieve what we wanted? If yes, maybe you can push for more, but if, no, you should be part of the conversation to figure out why maybe you would do that independently and come with new suggestions for what to do instead. Right? So business partnering is an end to end activity, starting with, you know, getting hold of the data and the numbers, true to making the decision and going through the whole execution and feedback loop where, you know, so it's, it's a circuit and I think that's very important. It doesn't stop once the decision is made, right. You have to be part of the whole thing.   Mitch: (10:36) So I do want to ask one more question if that's okay, and we can maybe use this as a preview for the next conversation, like you said, but, the end result being impact, right? So if we develop this insight, we follow this full circle of the full feedback loop. And after a decision is made finances, such an evolving function right now, what does impact really look like? And what should a business partner really kind of be focused on when it comes to analyzing the results of the decisions that have been made?   Anders: (11:04) Yeah, so I think, you know, if we talk about the outcomes that we want to create business partners, or, you know, the fan is functioning in general and how we want to measure ourselves. And we firmly believe there are three things to look at. The first is, are we as a business achieving the goals that we want, you know, could be a relational, tactical, strategic goal, and, you know, you name it, but how are we reaching our meeting of beating those goals? That is number one, because we were failing business, we also failing in finance. We cannot succeed in finance by improving a process or, you know, making a nicer tool or something like that. We can only succeed if the business succeeds. So that's, that's number one. Number two is then are you part of it? Are you part of the success and a good measure to look at there is customer feedback or stakeholder feedback. So as a finance function or an individual with multiple stakeholders do you actually ask for feedback, am I part of creating these results here or am I just the person that comes to the report, because obviously those are two different things. And, you know, by all means it could be that the stakeholder says, yeah, you're a great support, I love the report, and I can really use it for a lot, but then you're still just doing the report. That's probably half the third step. The third step is to sort of document what have you been doing to help create this impact? And we use a simple formula there called SCRI most the situation pose the challenge we face as a business that we needed to overcome. What resolution did we come up with and what was the impact? So you sort of, as a finance professional to try to have not a few of these impact stories documented throughout the year. So at the end of it, you know, finance get some power for ourself and say, we have these 35 fantastic impact stories that we were part of to help the business succeed. And boy, did we have a good year this year? Right? So we were also part of the success finance, but those are the three things, you know, how we succeeded in the business, how are we getting good customer feedback? And can we actually document and articulate what our role was in that success?   Closing: (13:09) This has been count me in IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Dana Pascarella: https://www.linkedin.com/in/dana-catanzaro-94978a6/FULL EPISODE TRANSCRIPTAdam: (00:05) Welcome back to count me in, IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson. And this is episode 140 of our series and today's conversation. You will hear from Dana Pascarella, VP of finance at Wesco International. As she talks about staff development. Dana is a finance executive with extensive accounting experience at a global publicly held fortune 500 organization. She is particularly skilled in mergers and acquisitions, debt, financings, business growth strategies and technology upgrades, among other areas, but she is especially passionate about developing our finance staff to ensure organizational success. Let's head over to the conversation and hear more about it now.  Mitch: (00:52) So Dana, from a finance perspective to kick things off here, what are some of the key areas you focus on when it comes to staff development?  Dana: (01:01) Yeah, so ultimately I'm focused on providing my staff, you know, a foundation that will allow them to deliver solutions in the future. So, obviously that's, teaching them the skills to become an expert in their area. Right. I want them to become an expert. I need them to have the basics, the fundamentals, the technical skills, but also I think it's so important, especially with the younger staff that they really start to understand and learn those softer skills. So organization, adoptability, communication, you know, those soft skills are so important and can truly take years to learn and you want them to be able to really be able to draw upon that, that total foundation so that the technical skill plus the soft skill will really provide them something, to draw upon as they move forward in their career.  Mitch: (01:59) Yeah. You know, it's interesting at IMA obviously we focus on management accounting, you know, accounting and finance and the technical skills, the emerging skills are obviously highly important, but we also really try to make sure that the foundation, you know, the, the leadership skills and the ethics, all of that is equally emphasized, I would say, and a lot of the things that we do and now granted it's for members as opposed to staff, but I think the focus is really there. And, it's all about developing that pipeline. Right. And I think that's kind of what you were touching on. So from your experience, from again finance and staff, when it comes to developing your staff, what kind of methods or types of trainings have you attempted, implemented? You know, what kind of training has been the most effective for you and your staff?  Dana: (02:50) Yeah, so definitely every year always focus on goal setting with a couple of stretch goals, right? I want to, I want to challenge them, pull them out of their comfort zone a little bit. But you know, something as simple as regular communication, having one-on-ones and being clear and providing constructive criticism to really help them, you know, improve if you're not providing constant and regular feedback, I don't think individuals know where to begin or what to improve on. So I really think that communication is super important, cross training, getting folks into, maybe areas that aren't their area of expertise, but, allowing that cross training to really build out their, their expertise, involving folks in a new project or a responsibility for a short period of time, if something comes along again, that's part of, kind of pulling them out of their comfort zone, but also seeing how they do with these new projects and give them that role, you know, obviously guide them, but let them be the decision-maker to an extent, obviously, you know, the leader I'd have to provide guidance, but let them participate to understand the different perspectives and see how they would answer the questions. And let them feel kind of part of that process. I also think anytime you can provide a staff an offsite experience, I think that, especially in finance right, we're just the behind the scenes books and numbers. So when you can give an employee an opportunity to kind of better understand the business, the operational side of what's going on, you know, be it visit a branch, an office, accompany an internal audit to a site visit, visit a customer, a vendor. I think that really helps, especially some of the newer staff really put the full picture together. So not only understanding the numbers, but also understanding the why, the how, and how the businesses is running. I just think it helps to put that full picture together and is just so much more valuable as they move forward in their career.  Mitch: (05:10) Yeah, I totally agree. And a lot of great practices there from my own personal experiences, I can say, you know, a lot of what you've shared that I've been through, it certainly works, and it really helps with that stickiness and makes everything kind of make sense, big picture, like you were saying, but I do want to kind of just follow up on what we're talking about here. You've mentioned a few different skills, but when it comes specifically to finance, what are some of the skills you see that are most important? You know, when it comes to staff development, we talk a lot about upskilling or reskilling. Where is the focus today?  Dana: (05:43) I mean, clearly you have to have that mathematical analytical skill set, right. I think, you know, today also having pretty strong IT skills are pretty important and that's all part of kind of that technical skill. But I also think persuasiveness, decisiveness, interpersonal communication skills are, it's all part of, of finance, right? It's more than just that technical skill. It's how do you, how do you deliver that technical answer? How do you, how do you provide that with confidence? Right. It's one thing just to give a number, but if you provide it with confidence and decisiveness, then your audience is, they have comfort in you and what you're delivering. So it's, again, it goes back to, you know, not only those technical skills, but, but having strong, soft skills.  Mitch: (06:35) That's great. And, again, I can really see how everything you're sharing comes together. I can relate personally to some of my experiences. So, like I said, a lot of great ideas, perspective here. I'm curious when it comes to thinking about these ideas and trying to put a plan together, how do you go about mapping out these needs? How do you go about picking these different practices to implement? Is it an individual basis? Is it by department? You know, how do you go about planning your staff development?  Dana: (07:08) Yeah, so I think it is important to kind of first understand the individual's career aspiration, their personality. You know, you want to make sure you're stretching and challenging the right person and the person that you're giving them challenges that fit their personality. Right, so you want to align project and work with those desires because if there's a mismatch, it won't be effective. Right. But it is about understanding that person, their career goals, their personality, and providing challenges and, and stretch goals to kind of push them outside of their comfort zone and see how they perform. You know, some people they're just, you know, you're steady Eddie, but, but some people have a desire to continue to move up in their career. And so you would align projects and responsibilities accordingly. So for me, it's always been understanding that individual person and their desires and their personalities, and then aligning the working accordingly.  Mitch: (08:10) So I will wrap this conversation up in just a minute, but, you know, I want to tie everything together first, before we get to our last question. Obviously so much has changed in the last year and a half that the whole, you know, global business environment. But as far as, you know, your experience in finance over multiple years, how have you seen the skills, the training methods, the different staff development plans change over time?  Dana: (08:38) Yeah, well, I think, I think last year was an interesting example of some of that change, right? We had a, we saw a macro economic environment that could quickly became unstable. There was a tremendous amount of uncertainty globally. Companies' goals and plans changed pretty quickly. We in finance had to be flexible in our, in our approach. I think the basic skills were still important, but we quickly saw an emphasis placed on IT skills and the reliance on technology to stay connected and be successful in our day to day challenges. So, I mean, to some extent we have to change our approach. We had to figure out how to use our apply kind of those historical methods, but in a virtual environment. So I really think the skills are kind of always the fundamental skills necessary for finance, but I think last year was a great example of how we kind of had to change our approach to teach those skills and to stay connected in a day to day virtual environment.  Mitch: (09:42) This will be my last question, I promise. But, as far as the different skills that you've mentioned, the different methods that you've, again, implemented, plans you've put in place for individuals, what are some of the benefits? What can somebody expect to, what kind of rewards can they reap from effective staff development? And what does that really do? Not just for the individual, but for the organization as well.  Dana: (10:07) Well, I think when an employee feels supported, valued, cared for, they feel that the company's investing in them. I think, you know, in return, you get, you get employee engagement, you get an employee that's willing to work for a company and help to drive results. You get that loyalty, the reduction in turnover, and all of that increased employee engagement, I believe leads to improved performance. So also from a company's perspective, you have a trained up employee, if you will, that can easily be slotted within different roles in the company. So it creates not only opportunity for employees looking to kind of grow, advance in their career, but it also provides an organization, the ability to be able to look within to hire before going external. So, you know, it's beneficial for both, both the employee and the organization and it overall it's, it improves morale. It just creates a strong, healthy environment.  Closing: (11:15) This has been count me in IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard and you'd like to be counted in for more relevant accounting and finance education, visit I

Contact Jennifer Booth: https://www.linkedin.com/in/booth-jennifer/Jennifer Booth’s bio: https://leasequery.com/about-us/leadership/#jenniferLeaseQuery: https://leasequery.com/More information on LeaseQuery’s 2021 Lease Liabilities Index: https://leasequery.com/lease-liabilities-index-2021/

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IMA Website: https://www.imanet.org/About the CMA Certification: https://www.imanet.org/cma-certificationFor nearly 50 years, the CMA® (Certified Management Accountant) certification has been the global benchmark for management accountants and financial professionals. Why? Because CMAs can explain the "why" behind numbers, not just the "what." And that can give you greater credibility, higher earning potential, and ultimately a seat at the leadership table.FULL EPISODE TRANSCRIPTAdam (00:05):Welcome back for a special bonus episode of IMA's Count Me In podcast. As you know, this series is dedicated to bring you the latest perspectives and learnings on all things affecting the accounting and finance world, as told by the experts working in the field and thought leaders shaping the profession. Well, IMA is pleased to announce that it has continued to shape the profession through its CMA certification and has just officially certified it's 100,000th. To celebrate this milestone IMA has planned a month long celebration to promote the impact the CMA has had on the accounting and finance profession. To kick off the celebration, IMA's brand content and storytelling manager, Margaret Michaels, spoke with IMA's senior vice-president of certifications, exams, and constant integration, Dennis Whitney, about the state of management accounting profession and the trends impacting its future. Keep listening to hear this insightful and celebratory discussion about IMA's CMA program.Margaret (01:08):Great. Well thank you Dennis for joining the Count Me In podcast. The first question is about the certified management accountant or CMA program that was launched in 1972 by IMA. Can you tell me a little bit about what the impetus for creating a certification program like this was?Dennis (01:30):Yeah sure Margaret, thank you for having me today. I'm very happy to talk about the CMA program. Yeah, it's interesting, back in the 1960s, IMA started seriously thinking about a certification program. The impetus behind that was that rightly so they believe that management accounting was a distinct profession from public accounting and that the competencies needed inside organizations were different from public accounting. There was quite a bit of overlap. You know, financial accounting is necessary both for public accountants and accountants working inside the company, but there are distinct competencies, cost management, financial planning, and analysis that are very important for accountants working inside organization. So they identified that need and they started the planning process to develop the CMA program. And it took several years of planning, but they had their first Board of Regents meeting in the beginning of 1972 and rolled out the first exam in December of 1972.Margaret (02:44):Wow. So the CMA has a long history and how does IMA ensure that the program is relevant to the profession right now and evolves alongside it?Dennis (02:56):Yeah, the CMA program has evolved quite a bit over these, almost 50 years now. You know, when we first developed the CMA in 1972, there was more of a focus on cost accounting, but today the focus is more on a planning, analysis, decision support, and also technology and data analytics. So the way we keep up with the profession is, you know, we're constantly scanning the environment, reading research papers, talking to CFOs, corporate controllers. But what we also do is every six years or so, five to six, seven years, we do what's called a job analysis survey. So with that, we identify the tasks that management accountants do every day and what they need to know to do their job efficiently and effectively. And so from that research, we're able to develop the content specification outlines and the new exam and keep up to date with the profession.Margaret (04:02):And how does continuing education fit into the CMA program?Dennis (04:07):Yeah, well, you know, it's interesting that you use the word program because the CMA is a program. It's not just the exam. When you finish the exam, you're required to do 30 hours of continuing education every year, including two hours of ethics and the reason for that is management accountants need to stay on top of the latest trends in the profession. They need to develop new skills, new techniques. You know, if you got your CMA 20 years ago, you know, most of that knowledge is still relevant, but there are new skills and in order to maintain your relevance on your job and add value to your company and also help you develop your career, it's very important that you keep your skills current. So that's why we have the continuing education as part of the program.Margaret (04:58):That makes sense. And I'm sure that continuing education aspect appeals to a lot of professionals who are looking to stay current right now. In looking at the growth of the CMA program, it seems as if the CMA has been growing most significantly in the last five years with 50,000 CMAs added from 2016 to the present. And for perspective, it took 50 years or from 1972 to 2016 to reach the first 50,000 CMAs. So what trends do you think are contributing to the CMA's astronomical growth in the last five years?Dennis (05:39):Well there are a couple of factors that go into that. First of all, for most of our history, we were pretty much a US, primarily a US certification. I mean, we are still a US certification, but our candidate growth has expanded beyond the US. So about 10 years or so ago, we started seriously looking to develop markets overseas. So we've seen tremendous growth overseas. Now we're still, we're growing actually quite well in the US, but we're actually growing very, very well overseas, especially China. We've seen tremendous growth in China. But we've also seen growth in Europe, middle east, very strong growth in the middle east over last 10 years. And India, India is a market now that's really growing quite a bit. And also Southeast Asia, for example, in the Philippines and Vietnam. So it's a global growth and that's attributed, contributed a lot to the growth of the program. The other thing is that we've, we really work hard to communicate the value of the CMA. And for example, we have every year now for the last, I'm not exactly sure how many years, five years or so, we've been doing a commercial and an ad campaign where we make sure that we tell the public, not just our CMA's and our candidates, but tell corporations through business development and tell the public through marketing, how relevant the CMA is. So that increasing exposure has more people who know about the CMA and more people who realize the importance of the CMA, particularly hiring managers. So we're seeing, for example, more ads saying CMA preferred and I think those are the reasons primarily for the growth. Well, one other thing actually is a bigger exposure on the university campuses. So more students are interested in the program as well.Margaret (07:54):That makes a lot of sense and clearly now more than ever, hiring managers and organizations are faced with challenges revolving around rebuilding post COVID and the talent war that we hear about where there's fierce competition for CMAs in particular. So as organizations look to build a more enhanced digital capabilities and transform their finance and accounting departments, how does the CMA specifically prepare them for those types of challenges?Dennis (08:35):Well the CMA has a very unique set of skills. So, you know, for example, over the last year we all had the terrible challenge of the pandemic. A lot of companies struggled, but it really was the accountants working inside organizations, many of them CMAs, who were able to help companies manage cash better, to implement strong internal controls, to identify risks. And those risks also extend to information technology risks like cybercrime, cybersecurity is a big risk these days and management accountants, CMAs, can help in identifying those risks and identifying ways to mitigate those risks. So that's on the one hand in maintaining a company, as stewards, good stewards of the company, financial stewards, but also as we move out of the pandemic into a new world where technology as you say, will be more and more part of our lives, particularly artificial intelligence. Management accountants, CMAs in particular, have the ability to work as strategic business advisors to senior management. So they can sit at the table, help them to identify new opportunities for growth, ways of adding value to the company, because they have the critical thinking skills, the strategic insight skills, and these strong financial analysis skills to help companies create competitive advantage and become successful for the long-term sustained success for the long-term.Margaret (10:22):And sustain success for the long-term definitely involves strong competency in technology, data analytics, and other emerging areas. And so the CMA exam has to reflect those competencies and has to make sure that people that earn the CMA are entering the workforce ready and able to handle those types of challenges. And in 2020, ICMA introduced a revised CMA content specification outline to include new competencies in technology, data analytics, and other emerging areas necessary for management accountants to do their job. So what was involved in updating the CMA exam?Dennis (11:08):Yep. Well that's, you know, that's a big job and it's, you know, it goes back to what I said a little earlier about doing a job analysis survey. So, you know, we want to make sure that our exam stays relevant and as you say, you know, technology is impacting all professions and it's having a big impact on the accounting profession. So technologies like RPA, blockchain, artificial intelligence, they are currently impacting the jobs and will do so even more in the future. So, you know, we want it to reflect that in the exam to make sure that our management accountants or our CMAs have the skills that are needed now and in the future. So what we did is we surveyed all of our members around the world, plus other management accountants around the world too, you know, we had a very long survey. It's almost, it takes about 45 minutes to complete. So it's a big commitment of time on the people who participate, which is a great benefit to us, but we asked them what they do on the job basically. And when we did that, we saw that technology and data analytics is becoming more and more and more important in their everyday work. So that's why, what we did is we took those results and work with the Board of Regents who did say, a committee of CMAs who helped govern the CMA exam. We work with them to identify the actual skills and the learning outcome statements that they need to be up to date with those technology and analytical skills. So we created the new content specification outline along with the learning outcome statements, which go into a lot more depth. And then, you know, from that there's a lot more work too, because then we have to develop new questions, which is a long process. We have to make sure that we communicate the changes to our stakeholders, including our candidates of course, and our CMAs, but also our review course providers. They need to know what's going to be on the exam. So it was a big process. It really takes about, you know, from the beginning of starting the job analysis survey to actually coming out with the new exam is probably close to a two year process.Margaret (13:40):That's a really long timeframe and it certainly makes sense that you have to take into account all of those various stakeholders that you mentioned. Earlier you talked about students and how they oftentimes just learn about management accounting in either entry-level jobs, or maybe if they're lucky a professor mentions it. And they then enroll in the CMA program and take the test and study for it while they're in school. What is IMA doing specifically to help students and make them workforce ready, able to succeed in an environment where technology skills are as important and as foundational as finance and accounting ones.Dennis (14:32):Yeah, we're actually doing quite a bit. We have, for example, we have the campus influencer program, and this is a program it's managed by staff, but basically volunteers go out and they talk to students. They give presentations to students about a rewarding career in management accounting and also about the CMA exam. We have a, every year we have what we call the Student Leadership Conference, where students, really from all over the world, come to learn about the profession and in particular, they can go to sessions, for example, on data governance, which is actually a section on the CMA exam and they can learn about those skills and then apply them when they go back to school in their classes. We also have, we just started what we're calling a student series of bi-annual panel, where we invite professionals, successful management accountants, mostly CMAs, or CFOs, or corporate controllers and they talk about their career, their job and explain how interesting a career it is and what skills they need to do their job. And I mean, in terms of resources, it's a long list of resources to talk about one, is the CMA. So we actually give scholarships to students to take the exam for free. So each college and university can give up to 10 scholarships to their top students and they can take the entire exam at no cost. And that's been very successful. In fact, I think there's been close to 16,000 scholarships granted, and these are granted throughout the entire world. So it's been a very successful program. The thing about the CMA is you can take the exam while you are in college, you know, generally should be junior or senior to make sure you have the coursework and then you have seven years to get the experience to earn the CMA. So it's a great way to show that you have mastered these skills when you're looking for new jobs and including those technology skills, which you mentioned, you know, and then also just with the student memberships that we have, it's a very nominal fee and you have access to our strategic finance magazine, which has articles on technology every month. We have our research reports, you know, we did a recent report on RPA. So I think, you know, we do quite a bit for students and the future, I think, is going to be bright for the CMA program because there's a lot of young people interested in it and they're getting the skills they need to have successful careers.Margaret (17:34):It sounds like IMA puts a lot of weight on making sure that there is a pipeline of talent and grooming future leaders through all of these kinds of student initiatives. So it makes perfect sense also when we're celebrating the 100,000 CMA to talk about the future as lying with undergraduate students and making sure that we're preparing them to be workforce ready and able to handle the challenges that will come with the future.Dennis (18:09):Yep, absolutely. We look forward to the next 50 years. I certainly won't be around for that, but I look forward to seeing much success for the CMA program in the future and another 100,000 CMAs.Closing (18:28):This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Contact Demetrios Frangiskatos: https://www.linkedin.com/in/demetrios-frangiskatos-00290a7/Demetrios at BDO: https://www.bdo.com/our-people/demetrios-frangiskatosFULL EPISODE TRANSCRIPTMitch (00:06):Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong and this is episode 137 of our series. Today's conversation is between my co-host Adam and the co-leader of BDOs SPAC assurance practice, Demetrios Frangiskatos. The SPAC, Special Purpose Acquisition Company market has long-term implications that cannot be overlooked. Demetrios joins us to explain factors currently driving the market as well as other considerations and risks. To learn more, keep listening as we head over to their conversation now. Adam (00:48):Demetrios, thanks so much for coming on the podcast today. To start off our conversation, where's the SPAC market now and what factors have been driving its activity and is it still a viable option to going public today? Demetrios (01:02):Thanks for having me, Adam and looking forward to our discussion. Yeah. You know, the SPAC market has been on a roller coaster ride over the last probably 18 months and all of it is sort of been going up just at different speeds and different levels. The market right now is probably a little slower than it has been, you know, earlier on in the year with regards to initial public offerings and raising capital through the pipe market, but there's been no indication from, you know, whether, the bankers,, attorneys sponsors, what we're seeing in the marketplace that it is still a viable option. We're still seeing activity. We're still seeing SPACs raising money. We're still seeing spot sponsors, which include asset managers and strategics and high net worth individuals who have had a lot of success in doing M&A, looking to raise capital. So I don't see it slowing down. I think we were sort of in an unprecedented market at the beginning of the year and that incline had started from the year before, and that might've been a pace that was difficult to continue following. But it still seems like it's going strong and you're still also seeing even the traditional IPO market go strong. So they both seem to be viable, options that are continuing in the marketplace, as well right now. Adam (02:51):So back in April of this year, the SEC issued a new guidance regarding, related to warrants that seemed to shake up the market. Can you talk about what happened there and what implications were for sponsors and target companies alike? Demetrios (03:08):Yeah, of course. Yeah, that was, that was a bit of a splash in the market with respect to the accounting behind warrants was dealt with in a certain way for a long period time and with the SEC statement it changed the direction of that accounting from what was fairly easy to account for the warrants as equity instruments, to if the warrant instruments had certain clauses they would have to be reclassified as liabilities. And what did that do, that caused, you know, there was at least 400 SPACs out in the market that raised capital, that had to reevaluate it. That was de-SPACs that occurred in the marketplace, where the warrants carried over from the original offering into the new operating company that became public that had, restatements. So it caused quite a bit of noise. And, you know, the timing was interesting because the statement came out in April and then in March, I shouldn't say then, but prior to that in March, we had started seeing a little bit of a slowdown in the market. I think the pipe market was reaching a bit of a capacity point in how much private investment was going to go into these SPACs and the combination of those two really, really put a pause in the marketplace. And it took, it took about, you know, maybe a couple of months for the market to start getting back up and going and enough time for the companies to evaluate what the rules mean with their current equity instruments, you know, attorneys to evaluate the structure, including the bankers. And initially there was a lot of hesitation and what to do, whether to file new SPACs with, you know, the legacy terms and my ability accounting, try to restructure these agreements so that they have equity accounting, and that started shaking itself out and initially we saw mostly filings of you know, saw the restatements on the old, on the existing companies. We started seeing filings of SPACs with, warrant instruments with liability accounting, and now we're starting to see a shift where the sponsors and the bank community and the attorneys are working on instruments that will, get these warrant instruments to equity accounting and you know, we're working through several within our firm as well, so you're starting to see the market evolve and address some of the concerns that the SEC presented in their statement. Adam (06:06):Can you maybe touch on the regulatory focus that continues to increase, such as the current chair's Gensler's the statements that he's made? Demetrios (06:14):Yeah, no, of course. I think, you know, you're going through changes in the administration right now, because of the presidential change so that's, we'll probably gonna see some shifts in regulatory focus and, you know, the appointments that are being made and coupled with, you know, Gensler's comments, maybe a month, month and a half ago, he was talking generally about the capital markets and there's been an uptick both in traditional IPO's, and that there's an expectation that will continue. But did talk about SPACs, and their sort of their resurgence from, you know, these were vehicles that existed several years ago, or much longer than several years ago, but they just weren't, they weren't being used as often and obviously now the activity is tremendous. And he was, you know, he was focusing on our investors protected appropriately with these SPACs specifically. I think his focus was on retail investors and them getting the appropriate information, that they need both on the initial IPO stage and in the de-SPAC when the target is the operating companies identify and the DSPAC occurs and I think he was cuing that there should be some focus on this and make sure with the volume that's going on that the disclosures and the information flow that's getting to investors is at the right level. And, the second point he raised, which I think has always been something that's been a focus is, just generally speaking the efficiency of the vehicle and whether, you know, is how it compares to traditional IPO. Obviously, the SPAC sponsor is the ones that are raising the capital and are the ones that are looking for the operating company. There's a certain level of dilution and costs that they bring to the table. The SPACs that we're you know, in the current market, maybe several years ago, they didn't have pipes, but now they have pipes which are private investments in public equity. So there's significant capital being raised through that and that they're getting discounted pricing. So the combination of all that is a concern that gets brought up, are the retail investors aware and, are they properly, being, you know, evaluating their decisions with the information for what's going in? So it's clear that there's going to be some heightened focus on SPACs, disclosure, the right level of information for investors, and then ultimately I think when these operating companies de-Spac into the entity and become new public companies, just that there's a right level of a bigger focus on the financial reporting side. I think you had seen several statements from the SEC earlier on in the year just about things that investors should be aware of with these vehicles and some of the risks that they pose. So there's no doubt, there's no doubt and we're seeing it as well. There's a very heightened focus on these vehicles and where they're going. And, I think more to come, right, I think with the change in the regulatory body, or the individuals in the regulatory body, and some of these statements it's clear that there's going to be a, there's probably going to be more focus obviously like I mentioned, and probably some changes come. Adam (10:13):Definitely. Now you just mentioned the sponsors of a SPAC transaction. Could you maybe break down everyone that's involved in the SPAC such as like the target, the auditor, et cetera, just so we can get a full understanding of what that takes? Demetrios (10:25):Yeah, no, of course. So typically, what you see in a situation where a SPAC, is created and wants to raise capital is certain individuals that are viewed as the sponsors of the ones that are effectively driving. They're going to drive this SPAC to buy a company, formed together and come together and generally speaking, maybe they think about, you know, their expertise, areas of focus that they've had in the past, whether it's healthcare, financial services, technology, and they combine certain individuals that are viewed as the sponsors because they're the ones that have the experience and sort of having the vision of what they want this vehicle to do. And then once they do that, they get together and come up with sort of their strategy or their plan and what they want to do, you know, what kind of company they want to buy, how much money they need to raise, and what markets they want to chase that because they also want to use their experience in order to help, you know, execute on this transaction and potentially help the company in the future once that these SPAC happens. So they get together, then they identified a banker, an attorney, and an audit firm to work with them, to work through the initial process, they come up with a dollar amount, they identify who they want to raise through the counsel of the banker, that process, you know, beginning to end, probably it takes about two months, maybe two and a half months, sometimes sooner, but that's the approximate range. They raise the capital, a hundred million, 200 million, 300 million, and then they start the process. They have, the vehicles usually have 18 to 24 months to complete the transaction. If it doesn't get completed in that timeframe, the capital that was raised gets returned to the investors. So they do have a clock that they have to work on and during that period of time, they go out into market and try to identify the right target, that they wanna invest in and that wants to de-SPAC and reverse into this company and become the new public company during the process. And that usually, doesn't have a set timeframe because it could take, you know, four or five months, or it could take a year, to get to that point and figure it out. Deal gets announced and then there's a process to go through a registration statement filings with the SEC, and then ultimately once the de-SPAC process occurs, then the, that operating company that was being targeted becomes the new public company, that goes forward and changes their ticker symbol and runs the operations from there. The board, which I didn't mention initially, there's a board that's set up with the sponsor is when the initial offering happens, that carries over, but there's sometimes there's transition planning and things of that sort, after the de-SPAC happens, some board member stay, some don't in where the new operating company goes. That's the short, that's a really short summary of the process, at a high level. Bankers obviously helping the sponsors raise the capital, attorneys are working with the sponsors on various elements of, you know, structuring agreements, working through the legal and regulatory issues around initial filing, and the audit firm, which is us, we do the audit work around the sponsor company audit that's needed for the initial offering. Sometimes we'll do the audit work for the operating company. The accounting firms also help, if they can't, they can't do both there's independence issues, but they could help on financial reporting. They can help on due diligence, they can help on tax structuring. It's a fairly complicated process, and involves multiple parties to get to the ultimate execution of the operating company going public. Adam (14:47):Definitely. so what kind of considerations should that operating company be thinking about when it's time to de-SPAC? You were just talking about de-SPACing, but what should they consider? Demetrios (14:57):You know it's a big, big change for these operating companies to, go from a private reporting environment, to a public reporting environment and I think there's a lot of things they should be considering, you know, from various elements of the business, marketing timing considerations, you know, when should they be getting ready? How quickly can they be ready? If the de-SPAC happens in a short period of time, will they have the right infrastructure in place, financial reporting considerations, right? Like what type of people do they have, processes? Do they have the right technology to be a public company? The reporting timelines are dramatically different, so they need to be thinking about that. Internal control considerations. Do they have the right control processes and, you know, do they need to evaluate anything from an accounting standpoint, as well as an operational standpoint, because there's just greater consequences to getting things wrong obviously when you're a public company with shorter timeframes to get things finalized. I think corporate governance and committee considerations are super important. Do they have the right board members? Do they have the right committees? Have they set up the right audit committee to work through, you know, all things that are critical when you become a public company is something they should be thinking about. And then ultimately just an operational standpoint, have they set themselves up as well to manage through a transition like this that's going to have sort of, you know, regular evaluation over their earnings and reporting and obviously that the information their flowing to the public is, has got a high degree of quality and accuracy as well. So there's, you know, from a governance standpoint, I think there's a lot of considerations from a control standpoint. There's considerations as well, although some of those may have existed already and then, you know, financial reporting and controls are, I think, extremely critical because I think those are the biggest leaps in transitions for a company that's private to go public in a short period of time. Adam (17:33):So how can that same operating company avoid financial reporting risks? Demetrios (17:38):I think, you know, when, before they think about going public, I think they really need to sit down and have a clear plan on, you know, what does the timing look like for the financial reporting needs of a public company. You know, so if they have to do 10-Qs, they have to do a 10-K, a proxy, all those things need to go out within set timeline. What is their financial reporting department look like? Do they have adequate resources, to be able to report? Do they have the right cutoffs and things of that sort so that they can have a financial report close process that could manage through that? And then I think while they're working through that, I think they also need to evaluate some of the complexities that go with being a public company which includes, you know, if their domestic or international, or whether in the GAAP standards, IFRS standards, public company disclosure requirements, you know, which include issues related to identification predecessor entity, form accountant and financial statements, just various things that need to go into a 10-K or 10-Q that they may not have to include before. There's a various gap that may be different from them being a public company to a private company. Application of certain gap that just applies to jus public business entities like earnings per share, segment disclosures, you know, other disclosure requirements, and just various assessments I think as well. There's also considerations with respect to certain things having different timelines for private companies and public companies with regards to accounting standards. So a private company, it may be due two or three years later, for them to adopt it, for public companies sooner. So really having a detailed plan walking through all this I think is extremely important for these operating companies, because I think they'll face a lot of new challenges from a financial reporting standpoint or, you know, just differences that they have in their current structure. Adam (20:13):That makes complete sense. You briefly mentioned the board earlier when we were talking about the roles, but what role does the board play during a SPAC? Demetrios (20:24):Yeah, that's a great question and I think that's a big consideration for the sponsors early on in the process and I think, you know, when they're working through evaluating who the right board members are, I think there really needs to be a thought on their skill sets, experience, industry knowledge, have they dealt and been on public company boards before and, you know, evaluating all those skillsets, I think is extremely important and making sure that aligns with the strategic approach of the SPAC. So I think there's a balance of operational focus with strategic oversight, and needing some experience with the SEC, with the PCOB and frankly, I think there's also a lot of value in having, you know, board members that, and obviously the vehicle has gained its momentum and, you know, the period of time it's been around is long but the number of people that have had experience with it is probably within the last few years, but getting board members that maybe have some experience with the SPAC process and de-SPAC process, I think all those things can be extremely valuable with the board and because I think there's just challenges that you run into and, you know, whether it's obviously initially raising the money, compensation structure is identifying the operating companies and whether they have the right, you know, infrastructure. So a lot of that, you know, guidance is important and experience is important from a board perspective and balancing, you know, different types of experience to help the SPAC and that de-SPAC process of course. Adam (22:30):Definitely. Now when you think about all the volume of SPACs that are coming into the market, what kind of pressure do you think it's going to feel? Demetrios (22:39):Yeah, it's an interesting point, right? Cause I think when you originally asked me about the vehicle and is it something that's still viable. I think, there's no doubt that it's viable and it's going to continue being used, but I think we will see how this market plays out once you start seeing the 18 and 24 month windows start expiring and how many of the SPACs actually execute their plan to de-SPAC with an operating company and with the volume of activity that we had between last year and this year, I think there's, I don't know where the last count is, but there's at least over 400 I think out there right now chasing operating companies and I don't know how many filings are with the SEC right now. It could be in the hundreds. There's going to be a significant amount of SPACs that have capital that need to be deployed. And, I think that saturates the market with capital that needs to go to work and the question is, you know, are, you know, are there enough companies out there that are ready to go public and have the right business model and maturity to be a public company? You know, that's a big question. You know, you're seeing some of these SPACs starting to focus on foreign entities, because maybe it doesn't have the same level of saturation as the domestic markets do. So I think you may see some refocus there. You know, I think if you look at the second quarter there was definitely an uptick in that part of the market. So there's, I think it'll be very interesting and I think that's one of the challenges the market may face is, are there enough companies that can actually be public companies and ready to be public companies for the amount of SPACs that exist in the capital and I think that's gonna put a little pressure on the system and something to watch over the next, you know, 6 to 12 months. Adam (24:57):So speaking of the next 6 to 12 months, you know, as we wrap up our conversation, what's kind of the outlook for SPACs for the rest of 2021 into 2022. Demetrios (25:07):You know, I think, in all my conversations and from what I'm seeing in the marketplace, I think these vehicles are here for that timeframe. At least I think they'll probably, you know, continue to be around after that. The conversations I have with sort of the market makers, everyone views them as a viable vehicle. So I think there's still strength in, you know, the approach that they're taking. Obviously the regulatory environment may shift some of that and change some of the direction. We're seeing an increase in activity now and we actually expect based on the conversations we're having and the dealings with our sponsors that I think, you know, September, October, November timeframe, we'll probably see a bit of an uptick just cause, you know, there seems to be interest in the marketplace to start, you know, raising capital at a higher level and if some of the, it seems like there there's an intention to develop warrant instruments with equity characteristics so that could simplify some of the accounting there. So I think you're going to continue seeing momentum in this space. I think, I don't think that there's going to be, I don't think you're gonna have the same pace you had at the beginning of the year. I think it's hard to do that, but I do think you'll have a steady pace and you'll see this vehicle here next year as well and, I think it just, it seems to have found a part of the market that that's very receptive to it and feels it could really be effective in deploying capital. Closing (27:06):This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA’s website at www.imanet.org. 

Continue the conversation with David!https://www.linkedin.com/in/davidshar/FULL EPISODE TRANSCRIPTMitch (00:05):Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong and this is episode 136 of our series. Many would describe the global business environment over the last year and a half as rather turbulent. From accelerated growth due to technology, followed by the effects of COVID-19, burnout has become a very common theme in the workplace. David Shar, business psychology expert, and founder of Illuminate PMC joins us to talk about what businesses and people can do to avoid burnout and find real meaning in their work. Keep listening as we head over to the conversation now.Adam (00:49):So David, thanks so much for coming on. Burnout is a word that I've been hearing a lot lately, especially with people coming on the other side of the pandemic and coming out of their homes a little bit more, but so many people have been stuck in front of computer screens in their homes for so long. Can you just kind of talk about what is burnout?David (01:07):Yeah. First of all, thank you so much for having me Adam. So burnout is definitely becoming a little bit more of a popular topic. Fortunate for me, unfortunate for everyone, I guess. And it is, becoming more and more universal, especially with what everyone has gone through and were not done, like you said, as we are now leaving our homes and going back to work and, many of us will be teleworking and be on fully virtual teams, but whatever that means going on to that, and I know it's a horrible term because it's used so much, but to that new normal, we're not out of the weeds yet. This is when, we're all going to have to start to really cope with what we've gone through and burnout by definition is typically defined as having three pieces to it. The first one is this emotional exhaustion and emotional exhaustion is often misunderstood. It's not physical exhaustion, it's not mental exhaustion, but it does lead to those things and even lead to physical ailment, but it starts as emotional exhaustion. The second piece is a general cynicism of work and, that's where we start really putting up barriers between ourselves and our coworkers and our clients and if we have employees between ourselves and our employees, we have this general sense of cynicism and we separate ourselves from our work as much as possible, mentally. And then the final piece of, burnout would be a reduced sense of personal accomplishment. And what that is, is that we feel like we're turning our wheels twice as fast and getting half as much done, or we feel like we're putting in the effort, but not getting the reward and maybe that means the compensation, dollars and cents compensation, or maybe it just means the recognition or the positive feelings or whatever it is we're putting X in and we expect to get Y out and there's an imbalance there, which is either real or just perceived, but either way it will take you to the brink of burnout.Adam (03:48):So as you described all of those three things, I know that I've been there, I'm sure you've been there, I'm sure many of our listeners have been there. What can business leaders do to prevent that burnout?David (04:01):Yeah. Another great question. So, right. We've all sort of been there, especially over the past year and a half. You know, who hasn't felt extremely cynical, who hasn't felt emotionally exhausted as they're trying to learn to do their job, in a new reality and, you know, within accounting, a lot of your work could be done virtually and a lot of you may have been already working primarily virtually, but even those individuals didn't necessarily have their children at home trying to homeschool their kids, you know, at the same time, that's incredibly difficult. There are, there were incredible barriers that we made work harder. And, so there's a lot that can be done from a leadership perspective, as well as the individual's perspective. But the biggest thing that I would say from the very beginning is we need to reconnect with what it is that we do, right? Like, we need to reconnect with our proverbial why, like what is our firm all about, what is our business all about? We need to be able to reconnect with that because that's what we've gotten away from. We get so lost in the weeds and so overwhelmed and distracted that we lose sight of maybe it's the client interactions, maybe it's the mission of the organization, maybe it's a difference that we're making and suddenly instead of all of those things, it's just spreadsheets on the computer and it becomes very easy to lose sight of those other things and so we need to take away the noise and create the sense of why again, and we need to be able to do it in a way that, brings people, brings people back mentally and also gives them a sense of control in their lives again. Work during the pandemic, could have been part of the problem, or it could have been an escape from the problem, depending on how much control employees felt when they went to work or virtually signed into work. If they felt in control of their work, then when their entire lives felt out of control work was the haven where they were still in control. But if that wasn't the case, then work was just part of the problem.Adam (06:37):So let's dig into that, finding your why a little bit more, you know, sometimes people have very mundane jobs, when you're first starting out in accounting, you know, sometimes you just, you know, kind of crunching numbers. How are people supposed to find meaning in that work and connect with that why, if they're so far down?David (06:55):Yeah, it's really interesting. So my first job, my first real job was, I was a kennel worker. I wanted to be a veterinarian and, turned out that, to be a bio major pre-veterinary you needed chemistry and physics. So I'm like, nope. And ironically, I switched to the business college and the very first class I took, I'm like yes, I'm getting away from all the math and the very first class I took was accounting I. So you gotta be kidding me, but suddenly when you took moles off the end of a number and you put a dollar sign in front of it made a lot more sense to me. But yeah, so my very first job was working in these kennels and I was pre-veterinary, I wanted to be a vet and I remember one day as a young man, I was literally pooper scooping, like picking up poop from the floor of a kennel. And I was doing this, I was working on alongside a coworker and I remember looking over and seeing her face and realizing that the two of us were doing completely different jobs, the same exact tasks, but completely different things. She was picking up poop. I was, I was creating a cleaner and safer environment for these sick animals. You know, I was caring for animals while she was cleaning up poop, you know, and it was just in the mindset. It was in how we saw our jobs and when you're in accounting or any profession, you have a choice in how you see the actual why of what you do, how much you connect with that. And we typically find careers where we have some sort of role model that we look to somebody that we see that we're like, yeah that's what I want from my career. And there's usually not that much of a separation between our career and life outside of our career. We look for significance in our lives, we look for significance in our career, and that might mean something different to each of us. Maybe want to make a difference with the organizational mission. Maybe you want to be able to, you know, afford to travel around the world and work from wherever, whatever it is, you're looking for something from your work. Burnout occurs when you suddenly don't find that anymore. When you realize, oh my God, there's so much bureaucracy and interpersonal conflict, which by the way, over the pandemic working virtually it's like, how often are we distracted by the amount of commas that our coworker uses their emails, trying to figure out if they're angry or just crazy, you know, like we get into these things that distract us. So just because elements of our work are mundane, does not mean that they are trivial, right? Just because something is mundane does not make it trivial. It is only trivial if we can't connect the dots to how this ultimately affects the final user, the client, how are we helping our client in the end? Because while you may be just crunching numbers in Excel or working your way through QuickBooks or whatever you accountants do, right? To me as my accountant you're not doing that, you're helping me and my family survive and thrive through and through helping me manage by my budget and my taxes and my business. I need that. And if you can connect with that and understand the difference you're making in my life and what that advisory role means to me as your client, that's very different than just picking up poop. It's very different than just putting numbers in a spreadsheet.Adam (11:07):That's so true. So if we take a wider look, you know, from a leadership perspective. What signs should leaders be looking for to see, you know, are my employees going through a burnout problem?David (11:20):One of the leading signs of burnout would be turnover intention. There are a lot of reports coming out on turnover intention right now. Microsoft, I believe just came out with a study, a global study that suggests that 41% of employees are looking to leave their employer within the next year globally, 41%. That is an incredibly scary number. Most of the time when leaders look at intent to turnover or turnover intention numbers, they think that's a scary number because that's going to be an indicator of how many people leave. I would argue that the people who intend to turnover and then leave, those people are the least of your worries. It's the people who intend to turn over and stay that you should be really worried about. Because we know that turnover intention is related to burnout and related to both of those, is this decrease in productivity and efficiency. This increase in toxicity, right? We know that burnout is incredibly contagious and so when you see people are trying to leave the organization, but they're handcuffed to the organization maybe you're paying more than any of the competitors and you think that's a great thing because you're holding on to people, but is it a great thing if people that want to leave can't afford to leave. So we need to look at things like turnover intention. We need to look at things like increases in conflict, like people taking much longer to get back to you, you know, via email or whatever messaging services that you use to communicate with your people. Absenteeism, presenteeism, people who start not showing up, taking more sick days and also people who show up, but in body only. There's a lot of warning signs. The number one thing leaders need to do is to listen. They need to actively listen and when we go through crises, oftentimes our reaction to that, we think that we have to take action, right? And we have to do, but again part of that burnout recipe is this loss of control. It's this learned helplessness, which is also a leading precursor to depression, right? And so what that means is that our actions don't seem to have the reactions from the universe that we expect. And so we feel helpless, it's learned helplessness. So what leaders should be doing is empowering their people and listening to their people, as opposed to trying to do all the talking and the doing, you know, they really need to be taking the calls of their people right now.Adam (14:31):Yeah, listening seems to be that key element just for any leader, are you hearing what your people are saying? Because if you're not listening, how can you know what's going on? And how can you be productive? And if you're not listening and burnouts happening, it's ultimately affecting your bottom line, but it's also affecting people. And if the people hurting, then the business will fail.David (14:54):Yeah, absolutely.Adam (14:56):So after listening, what's the next step you take? Cause you're listening, you're seeing, okay people are burned out. What do you do after that?David (15:02):One of the things that you can do, which I highly recommend is to set up boundaries. One of the things that we saw over the past year and a half is that, people are really horrible at setting up their own boundaries, right? You know, I used to talk about work-life balance as something that was a myth that couldn't exist after the invention of the iPhone, right? Because, I mean you take work everywhere with you as long as your iPhone is in your pocket and you take family life and all the other outside elements with you to work as long as your iPhone is in your pocket. And so work-life balance has not been, an actual, you know, attainable thing forever. But especially when you're working from home, if you don't have barriers set up between your home life and your work life, if you don't have boundaries, then it's all going to become intertwined and there's going to be a lot of stress and eventual burnout there. What employers can do, what managers can do is don't trust your people to set up these boundaries on their own and don't trust them to do it just because you suggest that they do it, there's a big difference between, you know, policy and culture. We can tell people what the policies are, that's not what the policies actually are. How are the policies lived? You know, so we can tell people, you need to set up boundaries, but if we don't push that and not just push it, but, live it ourselves, model it by putting our cell phone aside between certain hours, et cetera, our people are not going to do that themselves and we know this because the early data coming out from the past year and a half is that people have been working extraordinarily longer hours since the pandemic started. Since they've been working from home, they've been putting in more hours, not less. And so, and later hours of working into the night. And so we need to protect our people from that. They need that time to psychologically recharge. So that is one of the many things we can do. And then beyond that, we need to show support. We know that both emotional support and also more instrumental support are extremely important. You know, being able to support people by being a sounding board for them, listening to them when they're stressed out, listen to what they have to tell you, giving them advice, but also jumping in there and helping them with their workload if they need it, helping them figure out, you know, how to balance things. All of that is incredibly important and highly correlated with burnout. If people are not getting support, they're much more likely to burnout.Adam (18:10):So David, I'd like to just kind of wrap up our conversation and if you could just kind of give your insight of what you think the long terms effects of this whole COVID-19, people working from home and this burnout, what long-term effects will it have on the world of work in general?David (18:28):Yeah. So I think that, we're already seeing it and what's being termed the great resignation that we're looking at these 41%, you know, some industries are way over that in terms of turnover intention. People are looking for change and, you know, as somebody who goes into organizations and helps produce change within organizations, I can tell you that it is a rare day that people are looking for change. Usually people will push up against change, but change came and found us and we don't want to go back to the way things used to be. And so people are looking for change in their life because they've been able to reevaluate their lives and their relationship with work over the past year and a half. And so I strongly believe that we are going to see a lot of turnover and a lot of churning with employment. Leaders need to invest in their people now and when I say invest, I mean emotionally invest in their people now. Give them a reason to come back and to be productive and to reengage with work. And what is that reason? It depends on your organizational culture and on the needs and wants of your employees and only they hold that ultimate answer. And so, again, it comes back to listening and understanding that now with so many people going virtual, you're not just competing with the firm down the road, you are competing nationally, if not internationally, because so many other firms have entered your marketplace because now they are looking to build fully virtual teams of people that can work right from your backyard. And so it's incredibly important to be investing in the well-being of our people and to reconnect with the ultimate meaning, that meaningfulness of the work that your organization does.Closing (20:52):This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Contact James Burton: https://www.linkedin.com/in/jcburton/Personal Capital: https://www.personalcapital.com/Advisory services are offered for a fee by Personal Capital Advisors Corporation (“PCAC”), a registered investment adviser with the Securities and Exchange Commission. Registration does not imply a certain level of skill or training. Investing involves risk. Past performance is not indicative of future returns. You may lose money. PCAC is a wholly owned subsidiary of Personal Capital Corporation (“PCC”), an Empower company. PCC is a wholly owned subsidiary of Empower Holdings, LLC. © 2021 Personal Capital Corporation.Personal Capital SRI portfolios are powered by Sustainalytics.FULL EPISODE TRANSCRIPTAdam (00:00):Welcome back to Count Me In. IMA's podcast about all things affecting the accounting and finance world. This is your host Adam Larson, and I'm here to bring you episode 135 of our series with featured guest, James Burton. In the wealth management space, a few can claim to have accomplished more than James, a 20 year veteran of the industry, he has held executive, management, and C-level positions at some of the most respected financial institutions in the world. He now serves as Chief Growth Officer at fintech trailblazer, Personal Finance, and joins Count Me In to talk about how to turn a crisis into opportunity. Keep listening as we head over to the conversation now. Mitch (00:50):So James, obviously the global pandemic of 2020 caused a crisis for many businesses. A lot of our listeners felt this impact. For you personally, I'd like to start off our conversation by just having you explain, how did you help clients and organizations navigate through these difficult times, particularly in the beginning? James (01:09):Yeah thanks, Mitchell. You know, something like a pandemic and the initial market slump that it caused, that really, that really makes you reconsider everything, right? All your assumptions about your business model, your strategy, your growth opportunities, trying to see into the future. And naturally many of our clients went through very similar reflections about their goals and their financial situations, and they had a lot of questions about the future too. And the demand for advice, financial advice and expert support definitely increased. And in this case, it turned out that our company, Personal Capital, we were highly prepared for the crisis because we already had a hybrid digital and human model advisory model is technology enabled to operate remotely. So in a very general sense, we just stuck to our knitting. That's a British term, I think, meaning, we stayed on strategy and we continued interacting with our clients and supporting them through their financial concerns during the pandemic, particularly in those early, very stressful months. But we also made a very crucial pivot to getting everyone to remote working, from home literally overnight. And we could do that because of how the company was designed and built. So, you know, the result was that despite the initial market slump that we went through, we actually saw strong growth last year. People want advice. They want to holistic advice and they mostly don't want to travel to a brick and mortar building or office with wood panels, you know, nice little offices. They certainly didn't want to travel during a pandemic, right. And now, you know, a year later they know that in fact they don't need to go any further than their kitchen or the home office, to work with us. So we were able to help them, right away and we were able to help them remotely, which was great. Mitch (03:14):And now, you know, kind of building on this conversation a little bit, in leading up to our recording today, I was told that you follow a quote from Winston Churchill. It's a bit of a mantra and if I can just read the quote, "never let a good crisis go to waste". So, to help explain for our listeners here, why, what does that mean to you? How, do you go about using that as a mantra? James (03:37):Yeah, so Winston Churchill, he certainly produced a lot of great motivational quotes and I do particularly like that one, "never let a good crisis go to waste". I find myself using it a lot actually. And, you know, a good crisis, is very often a great opportunity. And that's because it's when you're forced to reconsider everything, you know, all your assumptions, your business model, your strategy, your opportunities, even your very survival sometimes. A really good crisis puts all of that in the picture. And as a result, it's often when meaningful change is initiated and it's when we move forward from the past, you know, to the future way of thinking. And in the case of our company, as I mentioned, we found that as it happened, we designed and prepared very well for the lockdown and we could commit to this virtual first approach. And as a result, we've proved beyond doubt that virtual financial advice works very well. If you have the right technology and business model and it's here to stay. So a great crisis here, which it really was, and in many ways still is, you know, helped us prove that and move into a future where, you know, advice can look very different for Americans. Mitch (04:55):And now we are, you know, roughly 16, 17 months through this, you know, it's been a year and a half and, you mentioned going into the future a little bit more, not every bad thing that happens is a crisis necessarily for business, right? We don't always face something like the COVID-19 pandemic. How can this mantra, this quote still apply on a daily basis, you know, once we kind of returned to normal or the new normal, however you want to refer to it. Can you give us some examples and some response options for the daily ups and downs of business and responding this way? James (05:31):Sure, sure Mitchell, and look, you know, certainly these have been some strange and scary times in the past year. But you know, it's exciting to look into the future and see things improving. I'm definitely happy to share some examples, but, you know, as I've thought about this, as you point out, you know, real crises and real opportunities, they're not exactly daily events, you know, thank goodness. They tend to come along just when you think everything's going great in your business, like maybe early 2020 for example. So every few years you may get a really good crisis, you know, something really challenging or bad happens in the environment or, you know, in your business. I've got some examples of how to put, you know, a good crisis to work, but I have to mention that they're not really day to day examples, they're how to really harness the big situations. So if you'll indulge me, I'll happily proceed, but, you know, I generally wouldn't use an expression like, "never let a good crisis go to waste", in the day-to-day environments, right. That's just doing our jobs. So I'm happy to proceed with, you know, let's just say longer term, bigger picture examples. I'll go for it. Mitch (06:48):Absolutely. Yes, please do. James (06:50):That's great. So, first of all, I could go back in the time machine, maybe about 20 years. And, at the time I was working for a well-known stock broker based here in San Francisco, and the company had experienced huge growth in the late 1990s. And then along came the crisis, the tech bubble burst in 2000. For anybody who was active in the markets at that time, you'll know that the market just bond and, you know, trading activity and the interest of people investing in their financial accounts, it just fell off a cliff. And there was a lot of revenue pressure for businesses, like the one I was part of. And here's the thing, clients were asking, what should I do? You know, they wanted help. And at the time the company was known for being an online stock broker that would execute your stock or fund trades, but it wasn't known for giving advice. And here we were with a situation where, you know, the markets had completely changed, the revenue dynamic had completely changed, there was a lot of pressure in the business and there was pressure from our clients to help them in new ways. So there's the opportunity right there. So we responded by building out new financial advisory capabilities to meet this demand for advice that was emerging from the client base, you know, when the markets turned. And what we started back then in a period of considerable adversity, now in time it became a major part of that business. So that's, I just wanted to provide kind of a historical example of how some of these, pivotal market events in the financial industry actually could really generate a significant positive change if you can get through them successfully. So that was one example. I've got another one, which is about, the company I work for now, Personal Capital, and it's a little different. And I'm gonna, explain what I mean by that. So Personal Capital came out of what I think of as an industry crisis, by the way, it also came out of the financial crisis. It was, founded in 2009 and, at the time of the great recession and financial crisis that started in 2008. And at that time, most of the industry was really falling behind, in terms of, you know, not providing the kind of experiences that other companies, digitally based companies were providing. So, Mitchell, let me ask you a question if I may, just to, you know, break it up for myself a little bit here. Could you, just give me a, maybe a company or a brand that you use pretty regularly in your life, that has a digital component to it. Mitch (09:50):Oh sure. My wife always gives me a hard time of all the Amazon packages that we show up at the front door. It's almost a daily delivery for us. So I'm a prime member and Amazon is definitely something we use regularly. James (10:03):That's a great example I expect, you know, like my home, your driveway is probably like a FedEx or UPS shipping depot some days, right. So thank you, great example, you know, that's the kind of service that many of us have found that, you know we wonder how we do without it having gotten so used to it. And if you think about some other brands, like, I dunno, TripAdvisor or Uber, or Sonos or Stitch Fix, and some of those brands we haven't used much in the pandemic, but before that, they were, you know, very prevalent. These are brands and companies that cross the physical and digital worlds and you know, what they've done in their spaces as they've leveraged data and technology and in turn, they provide us the consumer, the customer with information and control and choice, great convenience, often great value as well. They undercut the existing pricing in the industry, and frankly they transformed our experience as consumers, right, and as a result, they grew exponentially. So I just wanted to remind us of that background because I can't trust sort of meanwhile, 10 or 15 years ago, you know, I think household finance, personal finance was having its very own crisis, you know, when it came to the user experience and it was really ready for transformation. Let me explain a little bit. I'll try and make this kind of, pretty real, because I think it will resonate with you. So, you know, at Personal Capital we have, almost 3 million users on the platform and as a result we can see a lot of, what they do and how they organize their lives and we can understand quite a lot about their financial situation, which is how we can then help them. But one of the things that's really notable is that we see that the typical household that's using the platform has about 15 financial accounts, which is a big number, right. And just, you know, think about your own situation. Maybe this will resonate. Probably you've got a bank account, you may have got, I don't know, maybe at high school, maybe at college at some point you've got a bank account, you've got a debit card. Maybe you've got a savings account too. And then maybe you went to work for somebody after college and you got a 401k or something like that. Maybe you changed jobs, so you've got another 401k. Maybe you were smart and you opened an IRA as well, and perhaps you got some credit cards along the way and maybe a mortgage if you bought your first home yet. And, maybe you have an awful loan, maybe you have a Bitcoin account, you know, it goes on and on, right. So you know, typical household has this great sort of array of financial accounts and, you know, it's a lot and it's, you know, the question is how do you really understand your financial situation when you've got the stuff spread all over the place? And that's, you know, think about the, all the different logins you have to know, all the different statements you might be receiving, put in whatnot, it's just a lot to really put it all together. So most people don't truly understand their financial situation and they don't have that control and understanding that you would expect them to have with the digital revolution that occurred, you know, 10, 15, 20 years ago. So how do you deal with that? Well, maybe you can use a spreadsheet if you're motivated, I've tried it, it was kind of fun for maybe an hour, right? And then, you know, and that's only if you really like numbers, which I do. And then it gets really tedious and it gets hard work to update it and pretty quickly it's out of date, it's dragging, you know, your, whatever you put in for savings and investments and values is old, whatever you put in for your debts or borrowings, it's old, it's very hard to keep it up to date. I think, you know, even very accomplished accountants would find that pretty tedious and probably give up pretty quickly, right? So that was essentially what we saw as the crisis in financial services, which was that just when life was getting more and more complicated, particularly with the financial crisis, people didn't have the resources they needed and that was an environmental crisis. So in this case, looking more from the outside, we saw the opportunity, the founders of the company saw the opportunity to really address that and change the way the industry works, by bringing everything together for you in a dashboard where frankly, with a few minutes, you can enter your financial accounts, it's safe and secure, it's very important to people by the way. And then you can see your net worth, you can track your savings and budget and you can really understand what's going on in your life. So that was an example of where, you know, what is essentially a crisis at the personal level for people and turn it into a really great opportunity to help them. I'll make a quick plug, by the way, if I may here little cheeky of me, but I'm a believer. So, Personal Capital is by the way free. So the tools on the platform are free for everyone to use and I would, you know, I would encourage people to give it a try if you find it complicated to track your financial life. I'll pause there. Mitch (15:35):Well, thank you and the examples you shared certainly do resonate with me. I can certainly relate to a lot of the examples and situations that you discussed. So, you know, definitely a conversation I think is very relevant to many of our listeners and the more we talk about finance and personal finance, you know, this is certainly the audience. So I think that resonates very well. I do want to kind of continue on this track, but bring us back to the whole idea of, you know, crisis management a little bit and a lot of what we talked about is opportunity recognition from the organizational perspective, right? We're talking about businesses and recognizing how to persevere and then come out on top, you know, never letting a good crisis go to waste. So how about from this individual level? You know, you talked a little bit about individuals being able to take advantage of these opportunities, but how does it relate to the individual and, you know, even if it's a supervisor managerial perspective, you know, understanding what an individual can do during and following a crisis, what do you have to say about that kind of perspective? James (16:40):Yeah, thank you. It's a great question. That's one I've reflected on a lot because I do feel that some of the most challenging situations I've been in, in my career have also been, the greatest opportunities. And so we talked already about how, from a company perspective, you know, you shouldn't waste a good crisis because it's when you get a chance to reconsider things. It's when change is initiated, it's when you start to move from, you know, the past into the future. But I think at the personal level, there's also a lot to this. I think it's when people are tested, they can test themselves and they get tremendous personal growth opportunities. Obviously it can be in a very stressful situation, but, if you can survive that, you know, that can be full of opportunity. It's also when teamwork, your teamworking skills, your resilience and attitude, your work ethic, they really count, you know, when things are difficult. And as a result, I think it's when, many careers are actually made. That's certainly been my experience. Oftentimes the crisis is a really a great career opportunity. And in the financial industry, you know, in years, like 2000 to 2002 or 2008 to 2010 or 2020, and we're not fully out of the woods yet either. You know, you can already learn and grow, you know, at greatly accelerated rates relative to what you would generally be doing day-to-day when things are going relatively smoothly. Because you're solving for so many problems and issues. And also, you know, I think it's very exciting you get to work in different ways. Now, sometimes you may work very intensely with people you don't usually work with, you know, teams are reformed, new problems have to be solved so people come together in different ways. New leaders emerge and you forge new relationships with colleagues or business partners, that can be very deep and can carry forward for many years. And that can be very exciting and very rewarding as well. So, you know, these situations can be many different things. They can be a big strategic place such as, an acquisition or merger deal. It doesn't matter which side you're on, it's going to be a very intense time. You know, and you may be an owner or an advisor, but still you're going to be super busy and you're going to be working with new people. It could be a legal issue. Those obviously come up in businesses from time to time and it can be very stressful, but again require the same discipline of focus and teamwork and getting the right people together. And also it could be a market crisis and it doesn't matter which of those it is, my advice is to lean in and make the most of it in terms of, you know, what you bring to the table and the people you get to meet. Mitch (19:40):Well, thank you. I know from an IMA perspective through all of this, we really emphasize the importance of upscaling and rescaling through all of this, right. We looked at this, you know, the last year and a half as a great individual learning opportunity for many of our members, you know, many of our listeners here. What can we do to better ourselves during this difficult time so that when you know, that next phase does come about, we're prepared to take advantage of it. So, you know, to kind of wrap up our conversation, I do want to kind of build on that a little bit further. I'll ask you to take out your crystal ball if you could and if you had to offer up some advice to our listeners, as far as crisis management, managing others, personal development, anything we've talked about so far today, when it comes to preparing for the future, what is your stance and what would you like to share to wrap things up? James (20:32):Thanks first, Mitchell. That's a great question and I'm, you know, I'm very fortunate to have learned so much from so many great colleagues over the years, and I try to distill it down and simplify it in terms of, you know, any perspective I would share to just really three things. And those three things are, your customers, your purpose for your mission and the people you work with. And let me just say a few words about each of those. Starting with customers. You know, so I've personally, I've spent most of my career working in direct to consumer businesses and, but I think the same would apply in that business to business environment as well. And I think the thing is to be as up close and personal as you possibly can be and remember that, you know, your customer is a person or a couple or a family. They have hopes and dreams and fears just like everyone and they're really busy people. So we need to do everything we can to understand them, what they need, what they think, what they experience, and particularly in a time of crisis and particularly a time of crisis for customers, really understand the problems they face and why they face them and get to the root causes. And if you can get to the truth as experienced by your customer set, that's incredibly valuable in helping you, frankly at any time. It should be something we all work on all the time, but it's particularly valuable in a time of crisis or stress. So that's customers. I think, you know, if we do a good job of that, we can develop and refine our purpose, our mission, you know, what are we here to do? What are we trying to achieve? How do we help our customers address their challenges and do better? And so a strong purpose is obviously very inspiring to us and to others, and it galvanizes us to make things better, drive for change. And, you know, if you have a really strong mission, it makes work so meaningful and it makes your time incredibly valuable because you'll never have enough of it, right. You're just so focused and busy all the time and so I do think that, and it's advice I give actually to, you know, younger folk who are starting out on their careers, is to find an organization where you feel very onboard with their purpose and their mission and you will find you are inspired by it and your time flies by. And so that brings me to people, my third thing that I always focus on in times of crisis, but also any other time, which is, you know, for me at least, the people that we associate with, they're the single most important decision you can make, or maybe it's accidental, but they're still the single most important factor, in how, you know, how things are going to go career wise and so on. And the sort of questions I would ask is, you know, do we share similar values? Do we believe similar things? Do we have a similar ambition to make things better and to drive positive change in the industry we're in or the world? Do we love to collaborate with each other and team up? Are we going to be courageous when faced with a crisis and obstacles? And frankly, you know, when you're thinking about joining a team or a company, are these people that we're going to enjoy spending potentially years working on something very difficult and challenging, is that going to be a rewarding experience? And if the answer is, yes, that's really fantastic. And the chances are, you know, these are the sorts of people who are going to see opportunities and they're going to be motivated to strive after them, rather than just seeing difficulties everywhere, which is the other way of seeing it, right? So that's what I would really try and synthesize down as customers and purpose and people, and then sure, you know, you need to have the right kind of talent on the team. You need to have the right technical skills and expertise. I'm kind of assuming you have that. I'm more focused on, some broader things. I would also say you need to have the right planning and operational discipline, but again, if you have the right people, those things will come. Closing (24:52):This has been Count Me In. IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Contact Karri Callahan: https://www.linkedin.com/in/karri-callahan-5219676a/FULL EPISODE TRANSCRIPTMitch (00:00):Hey everyone. Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong and this is episode 134 of our series. In today's conversation, you will hear from Karri Callahan, CFO of global real estate company, Remax. Karri spoke with my co-host Adam about the role of the CFO and shared some tips for finance leaders. From strategy and technology to diversity, equity and inclusion, Karri has great perspective on many topics business leaders should be aware of. So to hear more, keep listening as we head over to their conversation now. Adam (00:47):So Karri, thanks so much for joining us and as you know, the role of the CFO is become very multifaceted and how can aspiring finance leaders better prepare themselves for providing a strategy and insight? Karri (01:00):Great, thanks so much for having me Adam, I appreciate it. And I think there's a couple of things to consider. First and foremost, I think it's important that you always keep learning, making sure that you continue to build your network, connect with peers and think about joining the right organization for you so that you can hear from different speakers and industry leaders on a regular basis, I think is really helpful. Some organizations that you can consider and that I've found helpful include Financial Executives International or FEI, and also the Association of International Certified Professional Accountants, so the AICPA. Since I've been the CFO of a publicly traded company for the last five years or so, I've also found, NIRI or the National Investor Relations Institute, a great resource, they offer some fantastic certification courses and trainings and have just a tremendous library of events and programs that they offer. So I think that's also another resource for you. And then of course, last but not least, IMA definitely I know you all have a lot of resources to help professionals. I think the last thing I would say is just read things that are of interest to you, so that you can stay current either on recent economic trends, trends that might be impacting your business or your industry, or just business leadership in general. But I think some of the best advice I've gotten is that it's important and critical to really be intentional about how you spend your time. Your time is truly invaluable and making sure that you get the most out of every minute is critical, but if you keep really absorbing information, learning from others, the better prepared you're going to be as life and your profession throw you curve balls. Adam (02:53):Yeah, definitely. So, you know, speaking of time, we know that time, technology takes a lot of our time and technology has changed how finance and accounting operate with how, many routine tasks or many, many routine tasks are now automated, freeing up professionals to focus on higher level tasks. How well acquainted should today's accounting and finance professionals be with technology like intelligent automation or RPA? Karri (03:21):Yeah. So it's a great question. Remax LLC, president Nick Bailey, who I work closely with, he oftentimes tells our agents that if you know that technology won't put real estate agents out of business, but agents who don't embrace technology will put themselves out of business. And I think that advice is applicable to so many other professions, including mine and accounting and finance. And so I think as you think about technology and as all professionals really think about technology, it's important that we're always learning and evaluating and studying new trends from a technology perspective, that makes sense for your company and the finance and accounting operations within your organization. Our teams are constantly evaluating how to incorporate new technologies and software into our routine accounting and finance processes and the reason why that's so critical is because it frees up our team's time to really help analyze trends within the business, evaluate business opportunities and really work strategically with other leaders within our organization so that we're contributing to strategic growth initiatives. And so technology is a key point to that, you know, as part of that transformation within our business, our company now has more in-house technology expertise and firepower than we ever have. We have now about 50% of our workforce that's directly involved in technology and we've recently announced an organizational change to really create one technology team comprised of all of those professionals so that we can really maximize collaboration, focus on our customer and end user experience and operate with purpose, passion, and excellence from a technology perspective. And I think what that does over time is, you know, we expect it really will benefit the entire corporate team, including everyone from an accounting and finance perspective, as well as other services function by really enhancing the delivery and supportive technology and data to all areas of the business so that we can continue to drive the business forward. Adam (05:28):Definitely. It sounds like Remax is doing some wonderful things to, be a leader in the industry. So what do you do to stay ahead on the technology curve? Karri (05:39):Yeah, great question. So I think, you know, fortunately the piece of change in the real estate industry, it's incredibly exciting and incredibly dynamic and because of that, our leadership team has really a front row seat to the latest technologies as we implement our MNA strategies as well as just continue to focus on our organic growth as well. For example, you know, despite a global pandemic in September of last year, we announced the acquisitions of Gadberry Group and Weenlow. Gaderry Group specializes in building best in class products that help clients solve geospatial challenges through accurate and precise location data. Weenlow is a Florida based startup that is reshaping the mortgage loan processing, process within the mortgage brokerage channel and they have developed the first service cloud for mortgage brokers effectively combining third-party loan processing with an all-in-one digital platform. And so those are just two really exciting opportunities that we have been able to execute upon as we really look to stay ahead of that technology curve. You know, we're always assessing the latest technologies and innovative companies with in, in the space and in our business pursuits because we are the worldwide leader and we want to make sure that Remax, stays in that position from a real estate technology perspective is clear. That mission is hugely beneficial to my knowledge of what's currently out there and what the space is, is truly lacking. It sounds simple, but another way to stay ahead of the curve is really by surrounding myself with a healthy mix of like-minded individuals and people who really stretched me beyond my own constraints. We have a fantastic network of about 140,000 real estate agents, more than 600 headquarter employees, and we operate in over 110 countries and territories globally and I'm so fortunate to be able to work with and network alongside people who have very similar core values and yet challenge each other to continuously improve and innovate. And I think that collaboration really transcends across our headquarters organization because I think staying connected with leaders on the technology side is really important. I have a standing weekly meeting with our chief operating officer who oversees all of our technology and am integrated with other leaders across our product and engineering teams as well. And I think that's really helpful because getting their perspective helps me stay ahead and stay current in terms of what's happening from a technology perspective. Adam (08:27):So to shift gears a little bit. Recently, business leaders have become more attuned to the need to actively promote diversity, equity, and inclusion, not just because of public pressure and what's been happening just in society in general, but because there are also tangible business benefits, how has Remax supported DE&I broadly and staff members who are women and or people of color? Karri (08:49):Thanks, Adam. I think this is a great question and part of the reason I think that it's important and one of the things that I think is critical to note in response to this, is that at our core, our business is a business that builds businesses. We provide a platform for entrepreneurs of all different backgrounds and more than 110 countries and territories, to be as successful as they want to be. And our approach to supporting entrepreneurship across all of those different dimensions has really been ingrained of the fabric of our company for nearly 50 years now. However, specifically over the last year or so, we've built on this cultural foundation and taken steps to promote actionable change both at our corporate level, as a franchisor and through our network of independently owned and operated franchisees across the globe. So from a corporate perspective, we've done a number of things. First, we conducted a 10 week racial equity and social justice challenge open to all of our teammates to build more effective social justice habits, particularly those dealing with issues of race, bias, and privilege, and really by having an open dialogue around these very difficult issues. It's our hope that we can each find ways to be part of the solution. I was excited to participate in it and I found the dialogue and the engagement very satisfying from a personal perspective. We also held multiple listening sessions across our employee base to hear from teammates on these topics, including their feelings on what we're doing well, what we can improve on, and what actions they'd like to see from our company on a go-forward basis. We've also enlisted an outside consultant to help us take an inventory of what we do around social governance that spans the spectrum in terms of our sustainability efforts, diversity, philanthropy, and our governance and what we do well and what we can improve upon. And then a couple of other things that are just single points in time. We did take a stand and issued a statement in the wake of the George Floyd killing last year, we closed our headquarters on Juneteenth, both in 2020 and again this year, and then our motto mortgage division also dedicated the month of April to advance homeownership fairness with their product, "one motto, one vision", which was an educational campaign that was focused on efforts to advance equality in mortgage lending and increase awareness of these issues within our motto mortgage network, as well as the consumers that they work with. In terms of our franchisee networks, we've also done a lot in this area, not only in the last year, but really throughout our history. We've been actively promoting, the national association of realtors at home with diversity training to our membership in all of our weekly communication that goes out to our network of real estate agents and this course addresses issues of diversity, fair housing, and cultural differences. Last year in August at our spring convention, we also announced the introduction of some additional training, which is through the National Association of Realtors, which is a fair haven training through our Remax university platform. And that's a course that really tests all agents on all things, fair housing. We continue to promote diversity and inclusion at our large scale events, including securing diverse group, a diverse group of speakers. One example of that was Baratunde Thurston who gave a popular Ted Talk at our franchisee owner conference in August of last year and the topic was, "how to deconstruct racism one headline at a time". And then we also use social media channels to champion diversity and also leverage a lot of relationships that we have across the real estate industry with housing advocacy groups, like the National Association of Hispanic Real Estate Professionals, or NAHREP, the National Association of Black Real Estate Brokers, or NAREB. And then the Asian Real Estate Association of America, AREAA and the LGBTQ+ Real Estate Alliance, and we offer a lot of trainings to our franchisees and agents on our platform in support of those programs as well. Adam (13:25):That's really great. Again, just sounds like Remax is doing some great things to be a leader in the community, to stand up and to make sure that there is change in our society, which has been needed for a long time. So that's just wonderful to hear. Karri (13:40):It's very exciting and I think for me as a leader, it's something that I'm just really proud of in terms of being associated with an amazing brand and an amazing company like Remax, both professionally and personally. Adam (13:53):So as a female CFO, I know that CFOs, to be a female CFO, hasn't always been a trend, for many, many years in the accounting profession. Have you ever experienced gender bias and what did you do to overcome those challenges? Karri (14:11):Yeah, it's a great question and I think from a Remax perspective, we are so fortunate because Remax was co-founded by Gail Liniger and historically gender bias is just not something that we've seen at this company. I think the gender diversity at Remax makes us stand out even more so because it's truly ingrained in who we are. In 1973, Dave and Gail Liniger, who are co-founders, they were two very ambitious professionals and they set out to build a new company that would truly operate differently than the competitors who existed at the time and ultimately disrupt the entire real estate industry as a whole. But central to that disruption was the fact that Remax was truly built on the back of female entrepreneurs with Gail Liniger at the forefront and really because at the time female real estate agents struggled to have a prominent role in the industry before Remax was introduced to today. So if you fast forward to today and you look across the Remax franchisee and agent network, we're close to 50/50 in terms of the male/female split amongst our real estate agents and franchisees who own franchises across our networks. Two of our five executives are female and 40% of our board members are female. So we don't really talk about it being important, I think we demonstrate just in those statistics, that it truly is important. And our proven track record of elevating women to leadership positions across the company, really combined with some progressive maternity and parental leave benefits is really highlighted because Forbes recently ranked Remax at number 11 on its list of America's best employers for women. And so in general, I do think that there can be a stigma and a lack of credibility associated with female leaders. I feel extremely fortunate that I haven't experienced this in my current role, but I am always intentional about establishing myself and my credibility because I know it's something that other female leaders have had to overcome in their workplaces. Closing (16:27):This has been Count Me In. IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA’s website at www.imanet.org. 

Contact Hilla Sferruzza: https://www.linkedin.com/in/hilla-sferruzza-cpa-mba-b3170b8/Meritage Homes: https://www.meritagehomes.com/FULL EPISODE TRANSCRIPTAdam (00:05):Hey, everyone. Welcome back to Count Me In. IMA's podcast about all things affecting the accounting and finance world. Adam Larson here with you again, and I'm pleased to introduce today's featured guest speaker Hilla Sferruzza. Hilla is the CFO of Meritage Homes and spoke with my co-host Mitch about the role of today's CFOs. In their conversation, she explains why future ready executives must have a holistic view of the business and possess four lines of sight. Keep listening to hear more about finance, strategy, technology, and more. Mitch (00:42):So in today's episode, we are talking about the role of the CFO becoming more central, more complex. Let's start broadly, and then we'll kind of work our way into some more specifics. So first, what is it about today's business world and the way organizations are run that requires the CFO to have a more holistic view and a better understanding of the business. Hilla (01:05):So, thanks for having me on Mitch. In today's world everything is moving at an accelerated pace. So change digitalization, everything is causing technology to just move really fast. So the risk of taking a wrong turn can be really expensive. So I think the CFOs have to take a step back and kind of look at the entire landscape of a company and really understand all of the interconnectivity of what we're doing as a company, as an organization, and make sure that decisions that are being made really impact the organization appropriately. So whether we're looking at it through the financial lens or risk assessment lens, a technology lens, an investor stakeholder lens, you know, more recently ESG and DI lens. It's really important that we understand the implications of everything that's happening. We're much less siloed than we used to be. I think we were kind of along this path anyway, and then maybe the pandemic and working from home accelerated that where decisions are being made real time very, very quickly. I would say in the public sector, where I am the CFO, it's maybe even more accelerated and CFO is having to answer live, you know, kind of on the go conversations, whether it's from investors or from analysts, you really have to have that broad knowledge of what's happening in the market, as well as all your competitors. So you kind of are a co-leader of all this data and you have to bring it back internally and make sure the guidance that you're providing the rest of the executive team and the initiatives and strategy that you're driving as a CFO really encompass the entire company's organization and operations, not just, you know, what are we looking for on the bottom line? What's the EPS going to be, of this decision, the consequences of this decision. Mitch (03:00):Now, with this deeper understanding, this broader understanding as well that you just mentioned of the business, how are you better able to lead the strategic planning, the risk mitigation processes for the organization? We have a lot of these individual conversations about, you know, the role of the CFO, but what is it about the CFO of the finance team that really allows them to work cross-functionally and ultimately make these important strategic business decisions? Hilla (03:26):So I love to say that the finance team is agnostic, right? Our only goal is the success of the company as a whole. Every other functional area, maybe has a little bit of a different spin. Maybe it's conscious, maybe it's subconscious, but they're all driving to a different objective. Maybe if you're in sales, you're focused on a different metric and if you're in operations or in purchasing or in marketing, everyone's got a little bit of a different spin on what they think is most important to make the company successful. I think finance is agnostic, right? So we can maybe take a step back, see the entire picture, not get lost in the forest or the trees and then give counsel that is best for the organization. So I can share an example. So I work for a home builder. We always have a little bit of a push and pull on timing and on dollars. We break our teams between the folks that do what we call horizontal work, which is land and vertical work, which is the actual construction of the building. There's always a little bit of a tug of war between those two departments. The finance team can take a step back and say, well what's actually most beneficial for the organization is to take this approach. Sometimes it breaks or it's one department, other times it breaks towards another department, but maybe, you know, I keep on saying agnostic, maybe a different word is also arbiter, right? We're kind of the one that maybe can help negotiate between all the different departments and through dollars and cents explain why certain decisions are the best decisions for the organization as a whole, even though there may be not an ideal state from one department versus another. Mitch (05:06):I think that's a great way to put it, the arbiter at the end that you mentioned, it really is, you know, just the understanding that we're talking about here from both sides of the equation and making sure that things balance, you know, when it comes to accounting, making sure that everything makes sense and works out. The way you explained it right there, the push and pull really helps clarify things, so thank you for that story and that analogy. I think, another interesting part of your role as we talk about these different decisions and different teams working together, obviously you have oversight over the finance team as CFO, strategy, operations, all the regular things that the CFO has a responsibility for, but you I understand also have oversight over IT. So what are some of the advantages of having IT under your umbrella when it comes to these cross-functional teams, cross-functional conversations and things like that? Hilla (06:00):So, obviously I'm a CFO. My first love was always numbers, but I will say that my current passion maybe almost bordering on obsession is the IT function. So I kind of inherited the IT function as I think a lot of CFOs do because the underlying system of record, the accounting system is kind of my general umbrella. And IT is a role that I guess it could sit with the CEO, the COO, or the CFO in a regular organization, but they're a little bit of a, you know, they kind of get tossed around. Nobody really wants to own it. It's a little bit intimidating to have a function roll up to you that's maybe not your core level of expertise. So when the IT team became part of my CFO team, I was nervous and excited. It's been a long time since I kind of didn't know something from soup to nuts, but I really dove in and the more I dove into the IT function, the more I realized that IT was going through a metamorphosis, right. They had kind of been the back office, keep the lights on part of the organization. Nobody even knew where they sat and call them if your password didn't work. And then they've really morphed into a key contributor and everything operations. Sure we still help you with your password, right. But the real core of what we do is operational efficiency, operational excellence, and, giving us that edge, that next differentiator. So for me as a CFO, this is the lens into the business. This is the lens into ops, all of the projects, all of the requests, whether it's a wholesale change where we're pairing with the business on providing self guided tours in our models during COVID or whether we're partnering through an accounting function, but still to help the business, obviously during COVID folks were not coming into the office, so we had to figure out how to process all of our accounts payable without folks coming in and signing checks and actually not even approving invoices. So we automated the entire AP cycle, so we're constantly pushing the envelope on how we can help the business. Number one, it's good to make the company more efficient, but on the operational focus initiatives, we're really gaining some insight as to how the business itself functions and I always say, IT shows us the art of the possible, right? Their brains maybe work in a different way than our brains work. They kind of see the world as a what if we can do right. If there was an unlimited amount of money, they could do a lot of really crazy stuff. So I think it's really interesting from my perspective, it's my window to the business, but then kind of layering in the finance piece of it. We have to pull back a little bit and say, okay, but what's the ROI. Cause there's a lot of really fun things that we can do that are certainly going to help the business, but maybe the return isn't there, right? I'll give you a silly example. There was a process that we wanted to automate. It was going to cost about half a million dollars. The person that does the job costs us about $50,000. So it's literally 10 years worth of work for that individual to automate something. I don't know if that makes sense, right. But probably not a good ROI on that investment. If we look at it in two or three years, it's probably going to be significantly less expensive to take on that project and just having one person do this process is probably not too detrimental for the company and it opens up the IT team to take on other projects that are probably more beneficial. So you have to be careful when you have IT, not to just take on projects and initiatives because they're going to make things better because they can, but also to appropriately look at the return and the efficiency, which is why I think, IT teams frequently fall under the CFO umbrella because we're always thinking of that, "Okay, but what does it cost and what is the return to the business of, of this proposal"? Mitch (10:04):Yeah, absolutely and, you know, just kind of backtracking a little bit. We did say in the very beginning, we were going to start broadly and kind of look at the holistic view of the business and work our way down. So as we take a look at some of these examples that you've shared is between finance and IT, I would like to go a little bit deeper if we could, you know, I think you mentioned the ROI and some opportunities that are there, obviously emerging technologies, you know, everything surrounding data continues to evolve at a rapid pace. So there may not be a definitive answer to this question. I'm just wondering if you have been able to implement anything or there are some innovations, opportunities that you're interested in pursuing, when it comes to digital technologies that do or will have that significant ROI for you, in the end. And you know, how does that really impact the finance function? What are some of the things that the listeners might be able to, you know, bring back to their organizations possibly and say, you know, can we do this also? Hilla (11:08):Sure. So we look at the world maybe in kind of three buckets, one from an IT perspective or a digitalization perspective, one is fix what's broken, right? So that you just have to do, you know, the report's not working, the data's not pulling through correctly and there's a team that does that. The next is how can we automate administrative tasks and free people up to do what they're supposed to do. So we have, you know, over time jobs evolve and they kind of become a little bit bogged down and have teams of folks on the finance group who just kind of data enter or their job is finance analysts, but they're doing no analysis. So my big driver, is to focus people back onto their role functionality and let's take all the administrative routine tasks and automate them through RPA and free people up to do their core functionality, whether it's a finance role through, APIs and having systems talk to one another so we're not literally just data entering, or maybe through something a little bit more sophisticated on our website. Putting a chat bot feature allows our sales teams to sell homes, versus I call them human Googles, right? They literally just read what's on our website. Well, the chat bot can read to our customers or potential customers what's on our website too. So let's take those routine tasks and move them into a computer automated process or robotics process and free up our teams and make the company more efficient. And then the third area is transformative. What can we do that's going to give us that leg up operationally, competitively that's really going to be a game changer. So, for us, again, I mentioned I work for a home builder. It's taking the design studio process and automating it. So that technology of course exists and, you know, in a car market you can go online and click here and there and look at what your car or a new part is going to look like, but it's a pretty complicated technology for home construction and interior design because of the variability in what you can select to put in your phone. So that is a big initiative that we're looking at, as an organization that's really going to drive it forward. So specifically what you do in every organization is of course going to be different. Every organization is in a different place in their life cycle, in their adoption of digitalization, of course, I mean, every industry does something a little bit different too, not everyone's going to be the digital design studio like we do, but I would look at that low hanging fruit to automate and give your team back the freedom of doing their job, especially in today's tight job market. It may facilitate a more efficient workforce for you if folks are actually doing their functional jobs rather than administrative jobs or being human Googles, and then keeping that long-term eye on the bigger vision, what do we do to move the ball for, for the entire company? Mitch (14:15):So I just have, you know, one more question and it's a little detailed lengthy question here, but I think it ties everything together really well. I think everything we've discussed so far kind of goes back to this analytical maturity curve that I know, you know, IMA has talked about and we've had some episodes, I know you contributed to an article talking about the different lines of sight and all of this really goes together. So to wrap up, I'd like to get your perspective and have you kind of explain how finance operations, strategy, risk, and now technology, everything we've talked about today really go together. When you serve as a CFO and for the organization, you have your hindsight, oversight, insight, and then ultimately foresight. So can you just tell us a little bit about what all that really means and how it comes together? Hilla (15:04):Sure. I love this question, Mitch, because I think that we probably do this all the time, but maybe we don't take a breath stop and think about it and see how it all lays out. So let's kind of attack them one at a time. So hindsight to me is really based on data, whether we're getting it from our system of record from county, we buy data from research farms that's just the aggregation of data. And I guess that's one part of the CFO umbrella. It's the data aggregation, it's the actual results, it's pulling all the information that we have available to us. And then that's really the what of the business and then you migrate into the why, which is really the kind of insight diagnostic phase. And for me, this is probably a marriage between operations and finance, right? They work together to kind of analyze what happens, say, well what were the drivers, why did this occur? Is it something unique? Is it a one-off? Is it within our control? Is this what we wanted? Is this what we thought was going to happen? So that insight is kind of ops and finance, holding hands. The next phase, I think is the real fun part, which is okay, well, what are we going to do about it? Now we have all this information and we know a lot of stuff about the business. How do we use it to a competitive advantage, right? We're a for-profit business. We're in a very competitive landscape in the home building area. We compete against other builders. We compete against existing market, existing homes in the market. So what do we do with that? And I think this is really where we harvest the power of data analytics, whether it's predictive or prescriptive. We're really kind of taking that strategic thinking that happens at the executive suite and marry it with all of the technology that we have at our disposal and how do we collate and aggregate that data, in order to help us make those decisions. And, you know, I want to make sure I'm driving home this point that the proactive foresight piece has to be a joint collaboration of the functional areas. So for us, our executive team is comprised of operations, finance, which obviously is also IT and technology, legal and HR and those core functions have to work together. So those, you know, function heads take all of that data, take all of that analytics that we've done and then we try to say, we call it internally skate where the puck is going, right. You don't want to be where you're at today because other people are going to overshoot you. You got to have that vision to say, well, where is the puck going to be and start to position yourself to be in that right place to accept it and score. So that's the foresight piece kind of underlaying it all from my perspective, I guess, is oversight. And, you know, the easiest throwaway answer of course is internal audit is the oversight, but I think that the answer is probably a little bit deeper than that. And that's just making sure that all of the data that we're using in making coming to our conclusions and making our analysis and decisions is good, right, cause it's garbage in garbage out. So if that integrity of what you're looking at is not solid, if the thesis that you're building on that data is not solid, the whole, you know, to use a home metaphor, if the foundation is going to break, the house has got to fall apart. So we really have to make sure with that oversight piece and we have a lot of controls in place, and they're not just controlled on the accounting side, it's controlled on the cleanliness and accuracy of the data, so that all the decisions that we make off of that data, you know, our predictive analytics are gonna hold true. Closing (18:57):This has been Count Me In. IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Contact James Stark: https://www.linkedin.com/in/james-stark-312a2/FULL EPISODE TRANSCRIPTAdam (00:00):Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson and today I will be previewing a conversation between my co-host Rouba and her special guest, James Stark. In this episode, James shares his insight and views on the challenging global landscape and the must have skills for CFOs. He is active in Egon Zehnder's financial officer's industrial board practices and is well-versed in the financial leaders need to evolve and optimize their careers and their organizations. Keep listening to hear more from James and Rouba now. Rouba (00:42):So I want to ask you a little bit about your career in the finance and accounting industry for so many years, I mean, throughout your career you've facilitated a lot of peer to peer learning within the finance and accounting profession itself, and you're a huge advocate for creating lasting value. Can you tell us a little bit more about what it means to drive that kind of level of value in today's very volatile globalized marketplace? James (01:13):Yeah, of course. So look, I tie this to the rise of the strategic CFO, which is something that's been written about quite a bit over the last decade or so. What that means, I think in practice is that CFO, senior finance leaders are becoming much more forward looking to help drive business decisions and not just kind of the backward looking scorekeeper that they might've been 20, 30 plus years ago. I think elements of that would also include scenario analysis and how you translate corporate strategy down to business unit or functional or even product strategy. So there's much more of a focus on commercial outcomes and driving the business forward. I also think finance leaders are really well equipped to help drive this value, given their position in the organization. Especially if they can broaden their skills beyond just kind of whatever that core part of finances they kind of came in or came up through. So, you know, rotations can help with that as you think about moving around between controllership to FP&A or treasury or investor relations or strategy and corporate development, et cetera. I've had CFOs tell me over the last, maybe five plus years that, you know, technical skills now are really just more like table stakes and what truly differentiates finance talent and helping to drive value creation, is having greater impact via, you know, better strategic thinking, being both deeply analytical, but also pairing that with a willingness to embrace new technologies and then also strong leadership and interpersonal skills can really help motivate and organize and energize the broader organization and I think specifically to that peer to peer learning piece, and I think part of that is also, you know, if you're a lifelong learner, you're going to be kind of more adaptable and you're constantly being incorporating best practices that you learn from others outside your organization, or even outside your industry. Rouba (02:56):Yeah, I'm all for the life learning approach, that's really a big value, at IMA. So when you look at, when your focus in recent years has been a lot on innovation and organic growth, but let's look into this new era, this new normal that we're in, the COVID-19 pandemic pre, during, and post, and as organizations are crumbling, some are succeeding, some have completely remodeled their entire business model and they're struggling to survive. What role does innovation play, I mean, and organic growth play at this time, if at all? James (03:35):Yeah, great question. It's certainly very timely, right. So I've been talking to senior finance leaders for almost two decades now and when I asked them about their top priorities, innovation and organic growth is always at, or near the top. And that's both for the company, but also even within the finance function, right? How can you improve your operations and processes within finance? So I think there's always a role for innovation, but it's important as well of course, ebb and flow, depending on what's happening both within the company, as well as the broader macro conditions. You know, in times of crisis it's well-known that R&D spending is typically one of the first line items that gets cut or at least drastically reduced, right. Cash is king and so, yeah, totally get that, that's going to happen in a downturn. But you know, but once that storm is weathered and you start seeing a return to normalcy, I think then it becomes time to quickly pivot and identify new opportunities for growth again. And I think the earlier you can make the pivot, you know, the better the odds that you can beat your competition at it. I'd also, you know, even use Egon Zehnder as an example in terms of what we did during the pandemic. You know, as the pandemic was ramping up, we didn't lay off anyone globally. You know, it was, we did stop, we did stop hiring, but we didn't lay anyone off and, you know, given our values, we didn't think layoffs were the right thing to do at the time, but also strategically, we didn't think layoffs made sense, and I think, you know, some of our competitors actually did lay off staff and, you know, as a result now that we're seeing this strong rebound in some markets, we feel like we're in a great position. Rouba (05:02):Yeah I don't think many anticipated the pent up demand and how it's going to see them scramble to get their business back to normal. So if we look at automation, machine learning, artificial intelligence, they've already begun taking serious inroads into the professional realm and not just in the finance and accounting sector, but every single industry. So digital transformation is now the conversation at every boardroom, every discussion and it was extremely accelerated by COVID. I mean, whatever was in the works a few months ago just became a priority all of a sudden. So when you think of this post pandemic, new normal per se, what are the skills that the finance and accounting professionals are going to require in order to maneuver with this new normal? James (05:49):Yeah, you know, I think some of these kind of core skills will get amplified given what we've seen over the last 16 months or so, right. And so that's around adaptability, resilience in being able to lead through ambiguity. I think we'll see likely an acceleration of some of these pre COVID trends as we move to the new normal. I think many have already, as you said, many have already been focusing on advanced analytics, bots, robotic process automation to improve performance within the finance function. As we, move to the post pandemic normal, I think those areas are going to remain robust. I'd also expect to see many people turning to artificial intelligence, machine learning, advanced data visualization technologies, and of course, digitalization to do things better, smarter and faster and who knows at some point maybe blockchain may eventually even live up to it's hype. Rouba (06:38):Hopefully. I mean, it's the biggest conversation right now, blockchain and cryptocurrency taking over the world. So we've seen companies around the world undergo major digital transformation efforts in the region. Some of the most notable are, Emirates NBD. I mean, these guys spent 1 billion dirhams, on, their own transformation. You're talking about roughly a quarter of million dollars, and just to enhance their performance, Coca-Cola says that they were able to reallocate 40% of their finance team's resources, at their time. I mean, allocated their time, thanks to automation. How does a company go about this process in the first place and what is the role that finance and accounting professionals can play to kind of facilitate, or maybe even drive and lead that change? James (07:27):Yeah, I think this one can be a little bit tricky to answer, because I think the term digital transformation can mean different things to different people. I do, as we mentioned before, I, you know, many finance executives have been turning to bots and RPA to automate what are typically known as kind of rote or repetitive tasks and they do that in order to free up talent, to focus on some of the more higher value add or judgment intensive activities, but you know, it's not just a magical switch that you turn on. There's a lot of effort and blocking and tackling that's required to make that happen and notably that's really focusing on fixing your existing processes first. But it's also part of a mind shift, a change as well, right. You know, you need to kind of change your mindset and be open to trying new things and not just say, "Hey, you know, this is how we've always done it". And that transition is not always easy for finance professionals. I think those who are unwilling to make that pivot do risk being left behind. Rouba (08:21):And by the way, I mean, I think COVID really has given nobody choice. I mean, it's now a mandatory process. James (08:27):It's imperative. Absolutely. Rouba (08:29):What's great about it is that we've seen CFOs step up and the whole strategic direction of companies and they've, they've really taken on more of a leadership role from a finance perspective. And they're being looked at for governance, risk management, business change, business resilience and technology advancements. I mean, these are way more advanced than we've ever been in the finance sector. Are the inherited skills of finance and accounting professionals, I mean, the ones that they've been trained to the way we've done this, as you noted, are these sufficient to make such big decisions based on data and all of this reliance on RPA and all of digital transformation and what are the crucial skills that they must evolve? James (09:11):Great question. And I think, you know, what we typically see in the market place, focuses on core competencies as well as elements of potential and I'll tell you a little bit about both. I think we might be a little bit unique in that regard and that we don't just look at past performances and experience to assess a candidate's ability to succeed in a role or a particular mandate. So, you know, depending on the role, we typically see a desire for finance executives who have several, strengths in these various competencies. So one is around results orientation, you know, how well can they drive performance, make improvements using fact-based analysis. A second one's around strategic orientation, which we already discussed a little bit, but you know, how well can you articulate evolving priorities over the next three to five years? And it also, how well do you consider scenarios? A third competence is around team leadership. So do you encourage new ideas from the team and do you embrace the differences across the organization? And then you use a range of management styles to really help enforce productive behaviors within the team. And then a final one is around collaboration and influencing. So how well do you seek out input from other stakeholders, do you share best practices and you invest in building strong relationships throughout the organization. And so when we look at, candidates and assess finance leaders, you know, we have a detailed scale and kind of how we rank them across these competencies. You know, those are on the lower end are really more reactive. But then those who are very proactive and influence beyond just even the finance function are the ones that will score, kind of the strongest. So that's the competence part. Another other piece that we look at is what we consider kind of the four key elements of potentials, what are kind of the big predictors of future success and growth over the course of a career. And we have four of those that we narrow in on. One is around insights, so how well does someone gather data and connect dots to discover new ideas or new thinking for the organization? A second one is around engagement. So it's really building that connection and winning the hearts and minds of others. Third one's around determination, very straightforward, right? How well can you overcome obstacles to drive results? Do you have tenacity and grit to fight through challenging times. And the final ones around curiosity? And we don't just view it as intellectual curiosity, you know, how much are you curious about the rest of the world around you, but it's also, you know, how much does someone actively seek feedback to improve upon their self? And so that also goes back to that lifelong learning piece we talked about earlier. And I like to think that that framework would really help prepare finance leaders to thrive in kind of the ever-changing macro environment. Rouba (11:45):No, these are amazing skills I think, and kind of pandemic proof as they sound so far. James (11:52):One hopes. Rouba (11:53):And one hopes that, but this brings me really perfectly into my next question because there's, and I don't know if this is a global issue, but in the region we're seeing less and less interest, in the finance and accounting industry today as a profession. So according to this study that EY conducted, 74% of CFOs surveyed, and it's called The Changing Role of the CFO, finance organizations are really facing a talent crisis. So even though there's so much encouragement towards bringing in driving the numbers, only 25% of people in the profession say they will stay. Why do you think this is happening and what can organizations do to drive the situation in an opposite direction and keep and retain people in the profession, make it more appealing? James (12:40):Yeah, it's a very interesting question. I think we all know that the war for talent is real and that's kind of across industries and functions. I think the follow-up question I'd ask in that EY survey is if only 25% plan to stay in finance, where are the other 75% expecting to go? And is there anything about the evolving role of the finance leader that can be used to help counter that? And so, you know, I may be biased, but I believe, you know, as the role of finance leaders continue to evolve, so will the attractiveness of the function, as a potential career path. And I'd also add that the opportunities are really increasing. Even though the CFO role is becoming more challenging as CFOs are being required to kind of take on more and more capabilities and functions. But you know, with greater demand for strategic CFOs, the path to the seat has evolved quite a bit, right? This is a pretty well-publicized that now that only, you know, less than a third of Fortune 500 CFOs have a CPA, right? That number was much larger 10, 20 years ago. I'd also add the average tenure of the CFO role is actually decreasing. It's now just under five years, at least within the Fortune 500. At the same time, CFOs are getting hired later in their careers. If you've got the average age of a first-time CFO, it's much older than it was just 10, 15 years ago. And then finally they are retiring earlier. So the average retirement age for a CFO is coming at a younger age. And so, you know, I think to sum up what we've covered, that the finance function remains an exciting and an evolving place to be. One where you can have even greater impact on the success of the company and from my perspective, that makes it much more attractive. Rouba (14:18):Well hopefully, we need CFOs. I mean, if the pandemic taught us anything, is that we need them to maneuver. James (14:24):Absolutely. You know, it's a big driver of value creation for organizations. So at least from a hiring perspective, you wanna make sure you hire the right one. Closing (14:33):This has been Count Me In. IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMAs website at www.imanet.org. 

Contact Marco Otti: https://www.linkedin.com/in/marco-otti/Budgeting Revisited: https://sfmagazine.com/post-entry/may-2021-budgeting-revisited/FULL EPISODE TRANSCRIPTMitch: (00:00) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong and this is episode 131 of our series. For today's conversation my co-host Adam spoke with Marco Otti about possible solutions in different approaches to budgeting. Marco is a group controller who acts as a finance business partner to support the decision-making of Autoneum, the global market leader in acoustics and thermal management. In their conversation, Marco discusses some of the common issues with traditional budgeting and explains why CFOs need to rethink how they plan and execute their budgets. Keep listening as we head over to their conversation now.Adam: (00:50)So let's start by talking about some of the issues with traditional and better budgeting. Why change?Marco: (00:56)Yes, why is innovation in budgeting needed, right? I mean, as a group controller, I contribute to our company's annual budgeting, monthly forecasting and three-year financial planning process, and I often ask myself, how can we as management accountants do a better job at budgeting, right? Kind of process be simpler or different. I'm sure most listeners have been involved with the budgeting process in one way or another. Maybe ask yourself as well, what do you consider the most significant barrier to improving or changing your budgeting process? There can be many barriers of course, for example, organizational attitudes towards budgeting, time, cost, inflexible IT systems, or the process being controlled by another group/department, or maybe you think there are no barriers at all, then that's great. One thing to remember is that traditional budgeting is still used in the maturity of companies. At the same time, many of these organizations identify agility as their strategy, which is quite surprising because traditional budgeting is too rigid to support agility well. And if you read Kaplan and Norton, they say that the ineffectiveness of many budgets also comes from the fact that almost 60% of organizations don't link budgets to their strategy and only 25% of managers have incentives linked to the company's strategy. Most of us are aware of the limitations of traditional budgeting. So it can be a very time-consuming exercise with limited value, as assumptions are quickly outdated. Also decisions are often made too early and other to senior level. And based on my own experience, having been involved in a budgeting process, the issue with traditional budgeting is really the amount of work compared to the benefit. I mean, having annual and detailed discussions with cost centers can be quite time-consuming and usually the complaints come from us, the finance function, finance organization who manage and execute this process. So depending on how lean and improved your process is, it can be an efficient exercise as well. With better budgeting you can substantially reduce the planning effort, for example, with less meetings, less reporting requirements, more top-down guidance, shorten the process to maybe one or two months every year. However, process improvements are still a continuation of the traditional budgeting approach and does not bring fundamental changes of instruments.Adam: (03:30)So then what are the essential functions of budgets and what are they used for?Marco: (03:34)That's a good question because, the functions and what budgets are used for, are quite relevant and important, like translating your company strategy into targets, which refers again to the strategy execution, Kaplan and Norton are talking about. Budgets are, if you will, the tactical implementation of the strategy, they are about resource allocation, which again, starts with developing and validating the company strategy. Therefore, I would say you cannot just remove the budget with its functions and manage your costs and business because planning is still important to coordinate activities, in your own organization. As an example, let me share some of the different functions the budget has at my company, Autoneum. We use the budget for setting absolute targets for the year and to support the performance management throughout the year, for example, every month. So the budget really serves as a reference point for performance and based on many assumptions, it gives a prediction of the next year and how we plan to control costs. Also it is used for resource allocation and managing continuous improvement initiatives. In any organization, traditional and better budgeting is really a mix and let's say a compromise of some of these and other functions.Adam: (04:57)Okay, then, so in the context of traditional budgeting and VUCA environments, how did your company respond to the crisis last year?Marco: (05:04)Yes, I mentioned agility before, of course, in a VUCA environment, like in 2020 with the COVID-19 pandemic, traditional budgets were not very useful to compare performance against because they were basically irrelevant by the end of the first quarter. So how did we respond? On the top line we planned for different scenarios and updated them weekly. In terms of costs, we used the most recent rolling forecasts, which are updated monthly. And in discussions with the business unit locally agreed on how to best cut costs. In some cases we instructed some top-down adjustments, based on the revenue levels. So for a time really stopped focusing on a budget, right, and shifted the attention to the monthly forecast and came up with intermediate targets based on the circumstances. This is also something to think about when you put yourself in the shoes of the decision makers. What did you or your company do to respond and manage costs during the pandemic? Did you empower your local teams because they know best how to manage costs. Or on the other hand, did you centralize decisions as much as possible because in a crisis there is a need for strong leadership, right? Actually, I mean, this spectrum of self-control versus command and control is relevant when thinking about new budgeting approaches. You can manage costs with detailed annual cost budgets or increase autonomy and flexibility by using absolute or relative KPIs, or even no targets at all. Of course, this then needs strong company values and a clear direction.Adam: (06:45)What are the possible solutions for more business agility and changing to different budgeting approaches like beyond budgeting?Marco: (06:52)Actually this question, was the reason why the president of the IMA Switzerland chapter, Hessel Brouwer and myself, reached out to CFOs and academics in Switzerland to learn from their experiences of moving to more modern and agile budgeting techniques and then also publish an article in strategic finance. One of the main ideas of the beyond budgeting theory is to separate the budget functions as outlined before. The key budget functions, are target setting, forecasting, and resource allocation. So instead of having one compromised number for all these functions, you would in a first step separate targets from forecasts and from resource allocation. With that, you would have three different numbers serving different purposes. A key tool is forecasting or rolling forecast, which supports the ongoing planning and forecasts are used for the purpose of better decision-making and not as a target or application for resources. Forecast should reflect the best estimates with as little details as possible and be again, decoupled from target discussions. Forecasts, again are not targets, you don't want to hit them. They measure and correct the gap with the strategic target or your ambition and the frequency and time horizon of forecasts will depend on the business cycle. And actually the best way to start to try a different approach is by changing the target setting. This means to introduce more stretch targets that are VUCA robust as we call it and reflect the comprehensive performance evaluation. For example, by using relative instead of absolute targets, this means comparing actuals with actuals of previous periods. And it also means the focus is more on midterm relative calls, where you analyze the trend or the improvement rather than an absolute figure. Another element would be the use of benchmarks that could be external or internal instead of working with fixed targets and for resource allocation of operation expenses, again use relative KPIs with trend monitoring. The same thing can be applied to compensation using relative targets based on group performance while comparing to benchmarks. And if you look up the 12 principles of beyond budgeting theory, what I mentioned so far are mostly changes in management processes like targets, forecasts, resource allocation, performance evaluation, but it is important to be aware that management processes can influence and change your company's culture. And what is needed is really a comprehensive approach that reflects leadership principles as well.Adam: (09:49)Okay. So then did you find use cases of companies that have successfully abandoned the budgets?Marco: (09:56)Yes, there were several actually, for instance, the case of the manufacturer Hilti, which has also highlighted in a strategic finance article, so let me share some details on how they manage their business more dynamically. Hilti’s former global head of finance initiated the changes during the same time as beyond budgeting came around in the early 2000s and Hilti’s model is very much based on beyond budgeting, but it also differs, especially with respect to the focus on leading with strategic targets. And the company's current global finance director, told us that being able to adapt quickly as an organization has really become a competitive advantage in today's environment. So what's particularly interesting is what motivated Hilti to change to an innovative approach, to measure performance. Because they noticed that their financial control system was working against Hilti's company culture. So the company had invested a lot in culture development and for example, with high transparency being one of the cultural principles, the leadership saw that traditional budgets weren't really supporting building trust in the organization. So Hilti decided to replace traditional budgeting with flexible planning. First, they changed the target setting and realigned to their bonus system, linking it to the company's progress towards strategic targets, instead of linking it to short term budget targets and individual targets. And with the implementation of a rolling forecast, they were able to replace the annual budgeting process as their measurements switched from budgets to actual comparisons, to monitoring actual to actual trends. Also Hilti defined a simple financial KPI structure that fits their business model. Ambitions are derived directly from the strategy to give the organization a long-term top-down orientation and to keep the system lean and flexible. Costs are seen as an input factor to achieve those strategic targets and are managed on a continuous basis and decentralized using the rolling forecast process. Coming back to culture, Hilti believes by setting a few relative strategic targets and delegating decisions and trusting their employees while ensuring a high level of transparency on progress also creates a culture of performance. And the overall financial planning at Hilti really starts with downhill strategy review they call game planning and then the cycle of the flexible planning follows with three rolling forecasts per year. This means that they don't wait for the next budgeting process to start in order to calibrate their planning. And again, as the COVID pandemic hit, it was impossible to plan for the next quarter while having to act and respond quickly. So management at Hilti at the time had to decide whether to implement short term measures or structural adjustments. And to guide their actions, they used the updated rolling forecast as a pulse check, and they're beyond budgeting, bottom up approach and empowered the regional markets to make the decisions. This self-control mechanism helps them to take the best actions tailored to each market. Also, it isn't just about transparency, but actively engaging and moderating the decision-making process of the management. At Hilti, the finance function is very much involved at the outset of the strategy review and the finance people take part in business discussions. This really helps to improve the overall alignment within the organization.Adam: (13:43)So Marco you've made some really good points as you've been going through this whole process. And we've been talking through these questions, but I have to ask why is now the time for CFOs to rethink how they plan?Marco: (13:54)Well, if we take the case of Hilti, that decision wasn't against budgeting, but rather challenging the assumptions of how performance was measured and looking for a comprehensive approach that's in line with the company's culture. And then in the process, traditional budgets became obsolete. And again, the main idea is to incentivize the organization to achieve long-term targets and measure the progress by continuously improving towards those targets. Success ultimately depends on how well such high-level target setting is aligned between the top management, the department and the team level by using our channel methods. To answer your question what I can say is that all CFOs we spoke to conveyed a new urgency to change the budgeting process and for any CFO, it comes down to a fundamental decision whether to make incremental changes to their budgeting practices, to lower the burden on the finance organization or alternatively to reassess everything and to try innovative budgeting. And the key question to answer is not only how well your present planning and budgeting approach fits the business environment, but also how committed the company is about transforming to agile ways of working.Adam: (15:14)I mean, that makes sense. So just to kind of wrap up our conversation, could you summarize the main lessons you've learned?Marco: (15:21)Sure. We already mentioned several aspects and I can summarize them with let's say six major lessons learned from our interviews. And overall business agility is really the biggest challenge for companies continuing to operate with traditional budgets. But whether your approach can or should be changed depends on the business environment and the culture readiness of the organization. This means it might be very challenging if you have a strong existing budgeting culture so the culture aspect must be addressed first. This also means that getting buy in from the top management and board of directors is crucial. So thinking about corporate culture is really the first lesson learned. Then it also needs to be a comprehensive approach aligned with the compensation and bonus system by replacing individual bonuses with team or group bonuses for example. So lesson two would be to go with an integrated performance management system for your planning and budgeting approach. And three, adjust your compensation and bonus system to share the company's success. And next I would say is relative target setting. Using relative instead of absolute targets for the key KPIs combined with long-term financial targets. Also implementing flexible planning with frequently updated rolling forecast that are most importantly decoupled from targets. And the last lesson is conducting rigorous scenario planning to review your strategy and include the finance function in the process. The CFOs were also clear about the need for finance professionals to take the lead and become true business partners.Closing: (17:06)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Keith Terreri: https://www.linkedin.com/in/keith-terreri-595b4bb/NEC Corporation of America:  https://www.linkedin.com/company/nec-corporation-of-america  https://www.twitter.com/nec  FULL EPISODE TRANSCRIPTAdam: (00:05)Welcome to episode 130 of Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host, Adam Larson and today I'm pleased to introduce our featured guest speaker, Keith Terreri. Keith is the Chief Financial Officer and Senior Vice President of corporate operations, and IT for NEC Corporation of America. In his double role of CFO and CIO, he has developed a wealth of skill and knowledge necessary for effectively overseeing and managing accounting, FP&A, supply chain management, corporate operations and IT. In this episode, Keith describes the convergence of these two pivotal roles and explains the value each team brings to the business regardless of the organizational size. Let's head over the conversation to learn more.Mitch: (00:57)So our listeners are well aware of the changing role of the CFO. It's something we talk about all the time, you know, the need for a strategic foresight decision-making business partnering is something that's very popular. A lot of this is due to the evolution of technology, but you have a unique role. You have a double role of CFO and CIO at NEC. So what does this convergence of the two roles really look like to you on a daily basis?Keith: (01:22)Thanks, Mitchell. That's actually a great question because it's certainly different than when I was just CFO. The convergence of these two roles, it's actually been a very eyeopening experience to say the least. So the convergence has come with some great synergies, and also a significant amount of risk management. From a synergy perspective, obviously our back-office functions of OTC, which is order to cash, PTP, which is procure to pay and record to report, or RTR have been greatly enhanced, right? So finance corporate operations, and IT are all one team now and communicating regularly. The interaction in visibility for both groups has been fantastic as one team and under this scenario, we work on a daily basis to make sure not only our ERP is running smoothly, but also our network and data is secure. For a risk management perspective, obviously cybersecurity has become a major part of all IT team's responsibilities over the last several years and now it's a part of daily operations for companies. However, in this dual role it's been becoming increasingly clear to me that cyber security is everybody's responsibility, not just the IT department. As everybody knows, ransomware attacks are very prevalent right now making cybersecurity the utmost importance on a daily basis. So we constantly monitor our network for security purposes and many companies are moving towards a zero trust approach from a cyber security information perspective and so that is also part of our daily discussion. Customers are also getting much more stringent, you know, on their contract requirements, requiring information security clauses in the contracts with us, so that we have to be very cognizant of that as well. So now we are very involved as we continue to make contracts with our customers. So, I mean, all in all it makes for quite a different daily routine than just finance.Mitch: (03:32)Well, as far as finance goes, you know, I know much of your career prior to this role, prior to taking on CIO also was specifically in the finance function. So talk a little bit about how those experiences and those skills helped you prepare for the responsibilities you just discussed and what you've taken on involving IT.Keith: (03:51)That's another great question, Mitchell, thanks. I mean, primarily, it was really my training in risk management that has helped me the most. Always concerning myself with the downside of either operational or finance issues has been very helpful throughout my career and now with that, the added responsibility for IT, thinking about the downside, or any type of issues from an IT perspective, has really been a good mix for me. Also having had experience in cyber liability insurance probably since it started, or when it was first offered, I've almost kind of grown up with that. So as a CFO, financial risk management is very important and frankly cyber risk has become, definitely become a financial risk to everybody these days based on all of the cyber activity that's out there in the world. I mean don't forget, I mean risk management is not only for services you provide to your customers, but also for your own network and your data. So you've got two things you have to look at from a risk management perspective and we do this frankly, on a regular basis. So when you think about all the, you know, traditional finance experience, most of the times the CFOs are responsible for risk management insurance. I think that the cyber liability insurance, which is changing rapidly as we've seen in the last month or so is very important for both the CFO and the IT guys to understand completely. I particularly, if you have a chief information security officer, that employee needs to be very familiar with how the policy works, if you should ever have a claim.Mitch: (05:34)Now, oftentimes because of the risk management perspective, you were just talking about how that falls on the CFO's shoulders. They're usually responsible for forging a relationship with the CIO because of the cyber security, cyber liability, things like that and the joint relationship is responsible for handing the priorities of finance and IT individually. We spoke a little bit your role prior to this call and, you know, you serve both. So how do you really communicate the needs and further support the relationships of two different teams as one person?Keith: (06:08)So this was definitely something I wanted to focus on when I took over IT three years ago. And I really think, you know, as a CFO and being able to look holistically at the financial statements and also preparing our annual budgets and forecasts, it becomes slightly easier to allocate resources for cybersecurity and for IT initiatives. There's no longer in my mind, right? In the way we have things set up a competition for funds or resources between finance corporate operations and IT. So it really makes for a more collaborative approach on resources so that when we prepare our annual budgets, we go together as a team and we've already kind of vetted out, you know, the priority of funds and funding for resources. The entire team discusses and ranks the needs so that we're all in sync. You know, one of those slogans I adopted early on with the finance team was “we're all IT now”, and that has really helped kind of change the mentality and increase the collaboration between the two groups. I mean, under this type of scenario, there's no longer any finger pointing and everybody accepts accountability. You know, in a traditional scenario where you have the two teams separated, in a traditional scenario, there separation of these two teams can create friction, which is not necessary in today's ultra fast paced business world. The entire leadership team of finance and IT, and corporate operations meets once or twice a week. They think that's an update from my perspective, but really it's for them to interact and update each other so that we're all on the same page and so no one person can say, “I didn't know IT was doing this”, or “I wasn't aware of finance wanted to do that”. And this communication has brought foresight and respect, into the team's relationships and I think once you have that, if you didn't have it previously, it's almost like a revelation and I've been really proud of the team's efforts to collaborate together. So for us, it's really worked beneficially and having both of these groups together and we're definitely one team all in sync.Mitch: (08:25)So I just have a quick follow up on that and two parts, the first one might be a bit of a layup, but the, you know, what I'm interested in is you have these two different teams collaborating and working together, prioritizing, do they have different needs? And, you know, you talked a little bit about that competitive nature in the beginning. What kind of, you know, different communication styles do the different teams need to adjust to for each other?Keith: (08:50)Well I think from a communication style perspective, I think everybody on the senior leadership team, they're senior leaders, right? So they're typically a director, senior director or vice president, and they've, you know, been in their current roles either with us or other companies for a long enough time to understand and respect, you know, other divisions and other departments and I think that once you have the right bunch of people together and everybody's communicating, and there's an awareness, right. So if you have different needs and different requirements, you know, you have to provide a forum for them to explain that. So like, IT may be very focused on cybersecurity when we're putting the budget together and we may need to allocate some money there, but cut some other costs in other areas where we may want to hire a consultant or something like that and it's a trade-off. So we talk about that and you have to, you have to risk review everything and figure out what's the riskiest from a financial perspective and allocate the dollars that way. I think from the finance team's perspective, they are often financial reporting and the ERP system, and really focused on providing services to their customers, their internal customers, which are the business units, you know, being in a traditional shared services group. So I think that the IT group is focused on things from the outside and the finance group is focused on things internally and as long as you have good communication between the two, it can really be a true synergy to have the two together.Mitch: (10:32)Now, again, just to recap real quick, we're talking about the convergence of finance and IT, the role of the CFO and CIO. I think it's fair to assume the underlying need or demand for this relationship to really work, either simultaneously or independently is control, right? And we talk a lot about internal control, you talked a little bit about risk management from the finance side, cybersecurity and cyber control from the IT side. Both of these teams need relevant, reliable data, right? That's really what it comes down to. So with your dual role, you mentioned earlier, you know, who's responsible for cybersecurity and it's really everybody, but from your hands-on experience in both functions, what can businesses do to enhance their control, enhance their cyber security and ensure that the finance and IT departments are effective in doing their jobs?Keith: (11:24)Yeah, it's another great question Mitchell and maybe I have a new answer for you. I mean, basically everyone is responsible for controls and cybersecurity. That's one of the things that we've really been trying to promote, you know, over the last several years, particularly as cybersecurity has become much more of a risk on a daily basis, so that it's everybody's responsibility, not only cyber security concern from the outside and using good business judgment on things you do with your laptops, et cetera, and access and passwords, but also internally and how we provide services to our customers, if they're web based or if you're using AWS or anything like that, making sure that we're following all the policies. On the organizational chart, you know, I'm responsible for control and cybersecurity, but, without the help of all of our employees to use good business judgment, it's really an impossible task, right? You've got to use good business judgment in your daily business as an employee. Internal controls are also the responsibility of everyone all the way down to the transactional level. You know, following delegation of authority, those types of things. A lot of times, cybersecurity it's just common sense, regarding access and such things as you know, multi-factor authentication. All businesses, you know, need to make sure there's sufficient awareness regarding cybersecurity and also the company's information security policies. So continued corporate communication or IT communication however that company does it, about new cyber attack mechanisms is very important. You know, it’s really just about awareness, awareness, awareness, and good business judgment and when we do our quarterly town halls, my last slide is always about using good business judgment and making sure we're protecting our business at the end of the day. I mean, for companies with both the CFO and CIO roles separately, I would suggest a new level of communication, where in the leadership of both departments communicate on a regular basis so everyone knows what everyone is doing, not just as a regards to Oracle or SAP or whatever ERP that you use, which is your traditional interaction. Networking, cybersecurity, and those types of things are very important on the finance and corporate operations side so that people can use better judgment once they're more informed. When changes need to be made, make sure both groups are involved and buy into the change management approach so that they can then be change agents for the rest of the company. For the companies that do not have a specific CISO role or chief information security officer role, I would suggest outsourcing this type of activity. Data classification and those types of things are very important if you should ever have a cyber event and there's a ton of third parties out there that can help you do everything from penetration testing, you know, helping to develop your incidence response plan, if you should ever have an event and often, for companies this is a more economical route to take, because I think I heard a statistic the other day, there's about 4 million open cybersecurity positions across the US and the positions are very expensive to hire, you know, from the outside. So usually bringing in a consultant or a firm to help you with this is awesome. You know, a more economical route to take. I mean, lastly, make sure both senior team leaders understand the cyber risk insurance policy and how it works and don't forget to include the legal folks as well, because if you have an event, all three groups need to be involved and if you have an incidence response plan, obviously you've already worked through all this, but these are very important things that, you know, from a communication perspective between the CFO and the CIO.Mitch: (15:17)Well, those are great steps to follow and thank you for putting that together. I want to take it one step further as we close out the conversation, because I know you did just mention some companies may not have all of these different roles at their disposal, you know, internally. So we want to be sure we provide direction for some of the smaller companies too, our listeners who work at smaller companies. How does today's conversation really apply to them? You know, what can your responsibilities or your experience, you know, the convergence of the CFO and CIO, how can that be broken down so it's more relatable to individuals who might not have this kind of exposure?Keith: (15:51)Yeah, I think that's another great question, because really most likely as smaller companies, maybe you don't even have a CFO, you just got a finance director, they may already have partial or complete responsibility for the IT aspects of the business. I really think today's conversation has just as much relevance to smaller companies because there's still reputational risk to your company if there's a data breach or cyber event, and this can be devastating for your business, for your owners, you know, or if you're venture capital owned or PE owned, or just personally owned by somebody can be devastating. And there's really, there's no way to hide from cyber risky today's world. Many of the biggest companies with significant IT and cyber resources, you know, continue to get attacked and you read about in the paper almost every week, right? So what I've tried to do here is break it down into some steps, whether you're a CFO, a CIO, or a CEO, president of a company, there's four steps I would recommend. First of all, step number one, identify the risk, right? Ask yourself if my network were hacked and data stolen, or my e-commerce webpage got ransomwared, how would it affect my business? If this is a material effect on your business, then you've got to continue to go to these next steps, right? So identifying that risk, number two, step number two, define how much of that risk you're willing to retain and then get cyber insurance for the remainder of that. In any company, any size can get that type of insurance so I would highly recommend that unless you think you can retain the entire risk. Third step would be to hire an outside cybersecurity firm to help enhance whatever internal resources you have, whether it's one person, a half a person or 10 people to be vigilant with your network and your data. And four, I mentioned this earlier, but practice constant awareness with your employees, whether you have 10 employees or a thousand or a hundred thousand, the concept is still the same. Get everybody on board, using good business judgment and these are really, these four steps I think are relevant for any size company, large or small, it can really help you get your hands around what you need to do from a cybersecurity perspective.Closing: (18:19)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Denise Dettingmeijer: https://www.linkedin.com/in/denisedettingmeijer/FULL EPISODE TRANSCRIPTAdam: (00:00) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host, Adam Larson, and I'm here to kick off our conversation for episode 129 of our series. Today you will hear from Denise Dettingmeijer, Chief Financial Officer of Randstad North America. Denise is a dedicated financial leader who is passionate about bringing more women into the field. While she talks with Mitch, she explains what needs to be done and how it can be measured to ensure women are integral part of the future of finance. Let's head over to hear her perspective on the topic now.Mitch: (00:44)Thank you Denise, for joining us. Our conversation today is about bringing more women into the field of finance. I know you said this is something you're passionate about. So to begin, can you please share with our listeners kind of your perspective on the current environment, the gender gap in the industry, and really what interests you about this topic?Denise: (01:02)Yeah, I absolutely can, and thank you for having me here today. You know, starting with the current environment, we can't not speak about the pandemic, so hope everybody's safe and sound. What that has taught us as an industry, as finance professionals that flexibility, the speed, the creativity, just, you know, crisis management was always one of our skill-sets, but nothing at this level before. And putting that into an environment like a pandemic from a past where those skills were always extraordinary for us, I think just exploded, you know, what we can do for the company. When you lay that over onto the gender gap, there is definitely a gender gap as a result of COVID as well in the industry, not just in the industry, in the world with working women. So focusing down on the finance thing, the one word I have is women are definitely underrepresented in the finance worlds. Statistically there's 38% of finance majors are female and 18% of CFOs are female. Those are for fortune 500 companies., it gets lower when you include all companies, 12%. So when you start out at 38, we could argue that's too low and what can we do about the education and having people that look like me and others, you know, getting involved in the finance stream of universities then accountants and other professionals, but regardless, even at the 38%, if we could get to 38%, that would be quite an accomplishment. We're hovering much, much lower than that. So no matter how you do the math, truthfully, we're underrepresented in an industry and in a function that actually suits traditional female traits and so many career pathing for so many people.Mitch: (02:45)Now you are at the forefront of the industry as CFO and through your experience as a finance leader, you talked a little bit about the numbers, but what else have you noticed as far as progress? How have you seen the industry really progress with this topic?Denise: (02:59)Yeah, so, the industry, as I think that beginning entry level has progressed. So you see a lot of women in finance when you do finance in general. So whether it's accounting, accounts receivable, payroll, FP&A, you know, the whole scope of finance, you see more and more women at the entry level. Truthfully, I haven't personally seen it progress in the upper ranks since I've been working, it's still a unique position. There's not a lot of women when you go to CFO events, when you look at panels, it's just an underrepresented group in this area. So while the industry has progressed toward, more soft skills, being able to connect people, it used to be a really kind of a technical function. It's progressed to understanding bigger pictures and teamwork and traits that perhaps are generally more seen as female traits, the female representation and finance hasn't progressed along with that. I think there's things we can do about it, of course. But until now it's really, it's still unique for me to see another female CFO. And every time we join a meeting, we're still counting. We're like, okay, there's 20 of us, there's three, that's more than 10% great. Right. We're still counting and when we can stop counting, I think we've made a difference.Mitch: (04:23)It's very interesting and you know, very, as you just said, minimal change from the target, the goal that you're really looking for. So obviously there's room for improvement. When it comes to, you know, closing this gap, how do you recommend the industry improves? What is, what is still lacking? What needs to be done next?Denise: (04:42)Yeah. So, there's hundreds of things. I think for me, the, the big ones are, it's hard to make this change, right? And I know people talk about unconscious bias and you know, you hire people who look like you or who have the same experiences. We've got to crack that and crack it for so many reasons, not just women, but race and all of the other, you know, gender issues or diversity issues that are happening. We no longer have to, you know, 15 years ago we had to put forth the business case of why diversity matters, how come companies perform better with a diverse leadership team. Those, we don't even talk about that anymore. Everybody understands that agrees with it, it's scientific, it's proven. So I think it starts now with the humans and the fact that we can all learn and admit we have unconscious biases, here at Randstad, we switched that and go, you have to have conscious inclusion. So there's a difference between saying, yeah I'm unconsciously biased, I can't help it everybody has it. To I will consciously include, and in this case women and finance, I will consciously include them at the table. If women have trends when they enter a room of more than 10 people with, you know, eight chairs at the table and five along the wall, they'll sit against the wall cause just don't want to take up a chair. Ask them to take a seat at the table, literally. We tend to when asked what we want to do with our careers, we say, well I want to add value and be happy. Men tend to say, I want to be CFO. And so if you can not let women get away with that answer and instead of, you know, ripping off the bandaid, you can say, well, whose job do you want next? What job do you want to do, you know really help us come to the conversation in a way that will be heard because we don't answer questions the same way, we don't communicate the same way, we don't act the same way. So I really think if you change your unconscious bias, become aware of it, but flip it to that conscious inclusion and really make an effort, it'll make a huge difference. The other thing I have to call out is the elephant in the room and it's money. You gotta pay us the same. And right now for me, you can do all those other things, but if it comes down to a life-changing moment, elderly care, child care, a spouse at home, a partner at home, and somebody makes less money than somebody else, generally speaking, the one who makes less money stays home. And unless you start paying women the same, they're going to stay home. So to me, start with the pay, you're not getting a bargain if your women in your department are getting paid less now they will leave. You will have a brain drain, pay them the same and then consciously include in the conversations in the career progression, speak the way we need to be heard and help us speak so you can hear us.Mitch: (07:34)You know, I really love that conscious inclusion and we have done a lot as far as unconscious bias and we just released a report on, you know, diversity, equity and inclusion. As you said, all of these, everybody's aware of them at this point, you know, everything going on in the world as well, they're all very well known terms, but when you kind of combine those two things like you did, conscious inclusion kind of brings out the emotional intelligence, another big topic, right? We talk about self-awareness and self-management and what can we do to improve? So, you know, that definitely all melts together so well. And, you know, I really appreciate that, that's something to definitely take away from here.Denise: (08:18)Yeah. I'll say as a CFO, you know, and as a finance leader, if you're used to making plans and having detailed numbers and, you know, deployable plans that will yield actions and milestones and ensuring strategic planning outcomes or tactical outcomes, it's the same thing with DNI. If you don't have a plan with numbers and intent and milestones and outcomes and checking along the way if you're getting there, you're not going to get there. So I don't think there's a better skilled person in the company to help with the DNI plan then the CFO or a finance leader, because of how we're trained to think and how we think about the numbers. It's the same process. It's not a HR thing, it's a leader thing and everybody, whether you're a CFO, finance leader or not in finance, needs to participate and really ensure that there's clear guidance, clear goals, and clear process to get us there with adjustments when it's not working.Mitch: (09:25)That's absolutely right and you were talking earlier, I thought about that. You know, many of our listeners here in finance, they're very, you know, quantitative people, it's all about the numbers and how do we make things work, and that makes sense. But a big shift in the profession, the industry as a whole is, really taking on some more of these qualitative features, right? Some of the softer skills becoming the business partner, this is all things we talk about. And this is all part of it, this is all part of that qualitative, some of that, less numbers driven and more people driven perspective. So, really great topic very well said and obviously we have outlined many of the challenges so far, and I think, there has been some action that can be taken based on your perspective and things you've shared. Even if everyone is able to kind of implement these recommended changes and work towards bringing women into finance more and into higher positions, higher pay. You know, even with more, if our listeners decide I'm going to do this, what are some of the obstacles you can still expect to encounter as you go through this process? Even if you buy into it.Denise: (10:35)Yeah there's two angles to that. The one challenge you will have in doing this is the same we have with everything, it's time and priority. It takes time, it takes a conscious effort, it takes a plan and it takes it being a priority. And very often you'll hear people, “I just don't have time”. Well, you do have a lot of time, you just haven't prioritized it within that time. So that to me is always the biggest obstacle is where's the passion, where's the need, again, we don't have to prove any longer that diversity matters, that it makes companies better, it makes companies more profitable. So where can and how come you can't prioritize. So that's my first, is a personal make it a priority and how do you do that? There is time you work 10 hours, 12 hours, however many you have work a lot of hours. There's time. How do you prioritize that? That's for me, the biggest thing there. The other piece though, is that this is a big transition. So it's difficult to work in a world where people, when I say they don't look like you, so they don't think like you, they don't act like you, there's not a role model to look at. If you, you know, I had an advantage growing up as the only female in finance in manufacturing which is like a double whammy. I love sports. So Monday mornings and the Monday management meetings, we would talk about the game, the quarterback, and I could hang with that. I had an early career female who worked for me. We were on a plane once, and I looked at what she was reading. She was reading basketball for dummies was the name of the book. So why are you reading that? She goes, cause you guys talk about basketball, I know nothing about it. I was like, wow. So there's, there's the time and priority, but there's also the adjustment until there is more mass, until there's more percentages, higher percentages. These women are still going to be the only one or the one of a few and that takes a special time conscious inclusion, all the things we just talked about, that isn't a one and done. It's not just the Monday meeting. It's every meeting, it's every project. Don't think for us, let us think on our own. So if you're not giving the job to somebody because they just got married and now you assume they're going to have a baby, let us think on our own, you know, ask us questions and really include us until there's enough of a mass, that it doesn't become a unique situation any longer. It will take a lot of time.Mitch: (13:09)Absolutely and, it's something like we said, it's really that human driven factor, right. Wanting to more or less get to know people first upfront, right. I think that definitely helps with the relationship management and being able to, empathize with people and it doesn't always have to be about something negative, it could be about something positive as well and put yourself in those shoes. You know, a lot of steps to be taken understood, absolutely. So we talked a little bit about the future and what we can expect, but I would also like to, get your perspective on what changes you expect to see and, you know, short-term, long-term, when it comes to bringing more women into finance, what do you think that looks like? Is there enough awareness at this point, what can be done and, you know, how long do you think it takes?Denise: (14:01)Yeah, so I would have, I'll start with the end, I would have hoped by now in my career path that there were, I'm not going to go with 50, let's go with the 38%. Those who have studied it, have a career in it, right. I would have hoped we were there by now and so I'm less optimistic of the time it will take a 17 year old daughter and, you know, I am working hard to make sure her generation doesn't have to work as hard and fight like we did. COVID is putting, you know, that back quite a bit actually, so I'm less optimistic of the time it will take, I think it’ll be another generation truthfully, but if we don't start now, it will not ever be. So that's the by when. Why I think and how we can make this work is the finance world, you know, back in the day you were an accounting technician, you were a hard worker, you worked through the night, you closed your books, you worked weekends. There was this kind of pride in the effort and the energy and, you know, we talk about work-life balance, now our work-life blend, which is what I prefer to talk about, it didn't exist really, you know, back in the day, if you are a finance professional. It is table stakes now. Male, female, people don't want to work like that. So the industry is changing toward automation. It's changing toward the robotics. It's changing toward those soft skills of collaboration, of cooperation, helping the business grow. You still have to close your books, absolutely do, and pay people and do all of the, you know, real core support with your controls and everything in place. But the piece that really adds significant value to the business and the customer is that growth and collaboration, strategic planning, data analytics, insights, that piece and that soft skills that I think you can train finance skills upon. And so in that aspect, if you can find a leader traits of a human being, women as well, that exhibit those EQ type soft skills, we can teach them finance. So don't let the deterrent of the education prevent an opportunity and at the same time, I see businesses in general, switching toward this EQ soft skilled people person, motivating creative need in finance, at the same time, all the rest of the roles need to learn finance. You need to know how a P/L is structured, what you do impacts, what you do doesn't impact and how it all links together in order to be a great business person and a leader in a new organization where the data is at your fingertips, the reports are there and you're interpreting and learning also on your own. So I think as that merges together, we're going to have a bigger ecosystem of business, including finance and numbers then we will have departments. And that only sets the stage for, as I said before, anybody with the great EQ, you know, soft skills that generally are attributed more to the female gender than to the male.Closing: (17:11)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Laura Boyd: https://www.linkedin.com/in/laura-boyd-2598a853/Hunter Douglas: https://www.hunterdouglas.com/FULL EPISODE TRANSCRIPTAdam: (00:00) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host Adam Larson and this episode, “Business Partners Developing Their Soft Skills”, is number 128 of our series. Laura Boyd, Vice President, Corporate Controller at Hunter Douglas joins us to talk about a topic not addressed enough among accounting professionals, the softer skills required in the profession. Everyone assumes accountants are all about the numbers and they are, but without the ability to collaborate across departments, they cannot be true business partners to the organization. Keep listening to hear about the specific soft skills required and how to develop them throughout your career.Mitch: (00:51)So our conversation today is going to focus on the soft skills and everyone typically assumes accounting and finance professionals, they're all about the numbers and we know they are but, I think everyone's starting to realize accounting and finance professionals really must possess and further develop these soft skills. So can you kick us off by sharing your perspective on this and let us know why you think that is?Laura: (01:14)Sure. Well, I think technical skills are obviously very important in our role as accountants and finance professionals. Our ability to analyze numbers and apply technical financial guidance, whether it's cost accounting or manufacturing accounting, or U.S. GAAP, IFRS otherwise goes a long way to supporting success in our careers. However, too much emphasis or rather not enough emphasis on developing and possessing these softer skills will really limit an individual's ability to properly support their business and develop their career in accounting. When we say softer skills, what we're really talking about is our communication style, leadership skills, team building skills, ability to make decisions, et cetera. Many of these skills are people type skills or interpersonal skills and since nearly every accounting role requires engagement with others in some way, shape or form, these become critical qualities to possess as your career progresses. In addition, people don't always think of accountants as customer service professionals, but in some way we are. Our business partners are our customers. They're on the receiving end of our hopefully quality work and we have an obligation to not only support them, but work well with them. And it takes several soft skills to be able to listen to a business partner and really collaborate with them. All of these things make finance professionals more well-rounded partners for the business, which is what our ultimate goal should be as accounting professionals. Well-rounded partner is an ally for the organization. If I could make an accounting pun, a well-rounded business partner is an asset for the organization. So while the technical side of our life is incredibly important and critical, it's becoming more and more clear that the softer skills are just as important for us and for our business’ success.Mitch: (03:29)So you already named a few of them. We talked a little bit about communication and teamwork and things like that. There are many soft skills and they're all important. But when it comes to being a business partner and really taking that step forward as a leader, which of these soft skills do you believe are most important for accounting and finance professionals, and why might that be?Laura: (03:51)Well, if you research around there's many resources out there from many folks that are much smarter than I am that'll tell you what's most important and why and what the right order is, et cetera. For me, in my experience, I think the three most important soft skills are interpersonal skills, communication and adaptability. So for interpersonal skills that's kind of a broad category, but it's a very important one. When I say interpersonal skills, I really mean the ability to build and maintain relationships and develop rapport with business partners and colleagues. Having good interpersonal skills is incredibly important when you're building a team, you need to have a strong foundation of trust and accountability for accountants and finance professionals this is invaluable. We should strive to be seen as an authentic partner for the organization and a person on whom people can rely upon and trust. Without that, we're just a bunch of number crunchers. Another important skill I think is communication. I think many people know there's many types of communication. There's verbal, written, and nonverbal like body language, facial expression, et cetera. But I think the one piece of communication that people really miss is listening. When people are listening to others, this is a fairly obvious statement, but you actually hear what people are saying and what they mean. Without strong listening skills, communication is really just a one-way street and probably not very effective. The better finance professionals are at listening, the better we are business partners because we're that much closer to the pulse of the business. And then finally I think adaptability is critical. If we've learned anything from the COVID pandemic, it's that we need to be flexible and adaptable. Now, traditionally accountants are not usually the most flexible people and I can say that because I am one. But, the ability to pivot and react to an ever-changing environment is critical. Our businesses are making fast and drastic and dramatic decisions practically every day. So we have to be able to switch gears and change direction as needed. In addition, I think it's important to be able to handle tasks and responsibilities that are a little outside the norm. By demonstrating a willingness to get involved even if you don't have all the expertise that's required. It's a changing world and I think accountants are a smart group of people who can contribute beyond the numbers if they're willing.Mitch: (06:57)You know, we at IMA, we have a leadership academy and we put out all these leadership development courses and we focus a lot on these softer skills. We just did one that focused on listening and listening skills, because it truly is so invaluable to just take a step back and make sure you're paying attention, you're listening and really absorbing the message that's being shared. So I can truly appreciate that and we've seen that become more and more important with our listeners here, obviously, but, with the organization as a whole in our members. With these skills, these skills that you identified as being most important, I guess my next question for you is when are they really most necessary or required? You referenced a lot about being a business partner, demonstrating these skills, at what career stage do you typically recognize somebody or maybe whether they do or they don't possess these softer skills?Laura: (07:51)Well in reality, these skills are really necessary from day one of your career. Most people in entry-level accounting roles have the necessary technical skills to do their job as required, or at least they have the requisite education beneath them on which they can build. And in addition, accountants will do continuing education classes or sit for an exam that gives them some credentials that are important down the line. And that is all fine and good and definitely necessary, but the fact of the matter is most accountants don't possess these softer skills right out of the gate and that's unfortunate. As I said earlier, good interpersonal skills are important for accountants and although it's all relative, they’re important at all stages of your career. So what I mean is an entry-level accountant may not be leading a team of 30 professionals right away, but it's still important for that person to build relationships across the organization and likely that's what their peers. At that early stage, peer relationships are incredibly important in building up that trust and accountability that we talked about earlier. The same is true for communication skills and an entry-level accountant may not be presenting a set of financials or a budget to the board in a three hour long presentation with multiple parties involved, but the person is still emailing with others on a regular basis and that's a form of communication, or they're on zoom calls, like we all are these days, on a regular basis and that's a form of communication. So the stakes may be slightly lower on a zoom call than in the board room, but being an effective and quality communicator is equally important in both scenarios. The fact of the matter is, is that as your career progresses, these soft skills become more and more important. At a certain point everyone is good at the technical side, everyone is a smart accountant, but what differentiates you from your colleagues is really your ability to navigate the softer side. If you're both cost accounting experts, but one person has great leadership skills and problem-solving skills, and they're a little more honed than the others, well that person's going to shine a little brighter. So I think that accountants really should strive to develop and possess these skills as soon as possible. I think, a good manager can recognize pretty early on when someone is adept at certain skills or on the flip side, maybe when someone is lacking in a particular area. As a manager, if you have the right critical eye, you can pick up on some of these subtleties fairly easily, because situations present themselves all the time. You also know which of your team members is coachable or not. So even though someone may be lacking a soft skill that you, the manager, think is critical, you should be able to tell if they're coachable in that particular area or not.Mitch: (11:11)Now from a manager perspective, I suppose, or, you know, you were mentioning, maybe you're overseeing a number of professionals, but equally so maybe you are somebody who's just looking to work their way up and develop these skills. To get this message, the importance of these softer skills across your team, across the organization. How do you recommend going about developing them? What are some resources or best practices, that you're aware of? What do you typically suggest to people who are interested or you believe need to develop these softer skills?Laura: (11:45)Well first and foremost, I think you have to take an active interest in your own development. You should ask for feedback from your manager, from your peers, from your team, from your business partners, anyone who knows you well and is willing to give you feedback. You need to listen to that feedback with an open mind as you'll likely learn how you're perceived in some areas that you can use development. The next step in my mind would be to seek out appropriate training for those needs that you've learned about or identified. There's numerous resources out there that provide support and education in all aspects of soft skill development, whether it's leadership training or presentation skills, you know, going back to our communication comments from earlier. The world is ripe with possibilities and in advancing your skills, so some external training I think would be incredibly helpful. In addition, I personally have found that having a mentor or a role model has been incredibly helpful in my career. If you seek out someone or several someones that you admire and aspire to be like, if you pay careful attention to how they conduct themselves in various situations, that can be incredibly helpful. And then I think the last thing sort of relates to the first one, in taking an active interest, is that you should ask for more opportunities at your place of work. You should ask to participate in a presentation to senior members of the business, or ask to run a presentation. Ask to manage a team so you can develop some of those leadership skills. You should volunteer for an assignment that no one else wants to be part of to demonstrate some of the problem-solving skills. Basically I think, you know, it's on you to take some ownership of your own development, whether it's asking for the feedback or seeking out the training or looking for the mentor or asking for opportunities at work. I think there's a lot of opportunities at your fingertips and you need to go after them.Closing: (14:00)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Carmen Rene: https://www.linkedin.com/in/carmen-rene-a063546/FULL EPISODE TRANSCRIPTMitch: (00:00) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host Mitch Roshong, and I'm here to introduce you to our guest speaker of episode 127, Carmen Rene. Carmen is the Vice President of Finance and Corporate Controller at Salt Health. She is a passionate leader who focuses on and emphasizes team management, multidisciplinary work groups, and coaching through obstacles. In this episode, Carmen talks about what it takes to be a leader and build teams around trust. Keep listening as we head over to their conversation now. Adam: (00:46) Simon Sinek said, “a team is not a group of people who work together. A team is a group of people who trust each other”. What does that quote mean to you and how you interact with your team? Carmen: (00:57) Sure. This is one of my, certainly one of my favorite philosophers, if you will, on leadership, but certainly one of my favorite quotes by Simon Sinek, because of what it really says to me is just because you are surrounded by a group of people and just because you work with a group of people, you don't necessarily have a shared vision and a common goal and a shared interest in being successful. And so without all of those things, I don't really think that you have a team that is focused on the same thing. And my belief is that, that objective or that dynamic comes when you trust each other. If you have a group of people who you know have your best interests and a common objective in mind, then I believe you have a team and you have an opportunity of being successful. Adam: (01:53) So what I'm hearing with that, what you just said is having that common objective, having that common mind, you know, how do you get to that common mind? That seems easier said than done. Carmen: (02:05) It's always easier said than done, right? I mean, I think that's a big part of what leadership is about all day long is a constant reminder and communication and check in about what we're looking to accomplish. It's often referred to as the why. What are we looking to get out of what we're accomplishing? What are we looking to accomplish? What are we trying to get and why? And if everybody understands the why, which I believe is a common interest, but, you know, oftentimes I work in accounting, right? It's very easy for people to go, we have to close the books, or because we have month end reporting, or we have investors, we believe we work for a company that we believe in, we're working towards an objective that we believe in, we have a team of people that we care about and we want them to be successful. So our why, is not the journal entry, our why is not finishing the books, the why isn't even for the most part the day to day. The why is where are we going and how do we know when we get there? And then we all understand that what I'm doing today is a step in that journey so that we can achieve, or, you know, land at the destination at some point. I think that's that common interest. And in many cases in business, we don't know what it is, right. If the common interest is I need a job because I need to pay my bills. That's not a common interest, that's Carmen's interest. But if the common interest is to leave mankind better than it was when we got here, because we work for a company that's working on a health solution or a cancer cure, or we're looking to have renewable power so that we can save the planet, right? Then all of a sudden we have a why that means something bigger than the journal entry. But my role in that big why is this team will be successful to ensure that this company has the financing that it needs in order to continue the projects down the path to achieve the objective. And if everybody on your team and keep in mind a team is very often multi-disciplinary, right? It's not just the, in our case, the team of accountants, the team of FP&A analysts, a team of treasury management, right? It's our executive team. It's our supply chain team. It's our friends on the manufacturing side of the house. It's our, everybody who manages the shipping and receiving departments, right. If we all understand the role that we play in that greater objective, then we show up to work, ready to give people the benefit of the doubt, ready to trust that we're all here at the end of the day to accomplish the same thing. Then I think you have a team, not just a group of people that you hang out with all day long. Adam: (05:17) You mean that makes a lot of sense. And you don't always work in with people who are doing the same thing you're doing. Many times there's people from multi-disciplinary groups who come together within a group and it seems like the things that you were just describing would work very well for that group, that multi-disciplinary group would have to understand the why in order to work well together. What are some steps you've taken to make sure that these types of groups are successful? Carmen: (05:47) You know, I think that the most important thing that you can do is be curious. And what I mean by that is, for example, I just put into place, purchasing policy. Kind of boring, right? But as part of that process, I spent some time with the, Ph.D. scientists who worked in laboratory, and we were having a conversation about how they use pipettes. I’m sorry pipettes and pipette tips in the laboratory. Now, as I mentioned, I'm an accountant, right? I never used a pipette tip in my life, but as members of the supply chain, I've ordered them before. So I was sitting with them for a day, observing them in the laboratory about how they use pipettes and how the process in an experiment is impacted or how the results are impacted by the process and how clean they can keep the sample. So literally every time they would move to a step to a next step, they would change the pipette tip. Now that seemed a little excessive to me for a minute. But then later in that day, or sometime later that week, I was reviewing results of something that had come out of the laboratory, product that we had to scrap, right, we had to throw it away. And I asked the question, well, why are we throwing this stuff away? What happened? They said, well we had some contamination in the processing. And it connected me back to that exercise of watching them prepare samples and changing the pipette tips. So all of a sudden I understand a whole lot better why we need pipette tips, why we need so many of them and where contamination can occur. And I brought that back to the purchasing policy around how do I set up a policy that enables them to have a blanket purchase order, right. A standing order for pipette tips, because they use them all day long, every day, all month. Right? So, because I understand, I have a much better understanding of the why, and this is a very small example, but I have a much better understanding of the why and how these products are used, so I can understand how I need to design a process that accommodates, not just me who happens to hate blanket purchase orders, but I can accommodate my scientists who wants to know that there's just going to be a constant stream of product being delivered to their laboratory so that their experiments aren't in any way altered or impacted. I hope that makes sense as a how you can bring multi-disciplinary teams could together to just have a simple conversation. So why their day to day is impacted by my day to day. Adam: (08:51) It's a simple conversation of being able to turn off your perspective and point of view for a moment and look at things through somebody else's shoes for a moment, and then suddenly your worldview is opened up. Carmen: (09:07) Absolutely. You know, Stephen Covey was right when he said, what is it, seek to understand, “first seek to understand, then seek to be understood”. And that's all I was trying to do here is how do I understand what other people are, what their needs are. It's a very simple, it's a very simple example. What's interesting, kind of the, the by-product of that if you will, is that Ph.D. that I spent the day with in the laboratory so that I could understand how pipette tips got used so I could master the purchasing of them. We're buddies. Right. We got to know, because we spent time together, we just got to know each other in a way that was very different. And now when I have a question about science, she's the one I call. So there's a fringe benefit, if you will. That came from that. Adam: (09:56) I've got another quote that I'd like you to comment on. This one is from Shafi Qureshi. "I expect my team to make mistakes and break things, thereby enabling individual development and process improvements." Carmen: (10:08) Sure. So I work with Shafi at Salt Health and he's the head of our engineering and manufacturing teams. And I asked him, just tell me what leadership means to you, or how do you define yourself as a leader? And he said, I asked my team what they broke today. And so it was a little more refined quote around that, but his whole concept is around, I want to make sure as a leader, that I'm creating an environment that is safe for people to make mistakes. For two reasons, one is we're all people and we make mistakes, right, and sometimes they're, I missed a meeting mistakes and sometimes they're, oh God, I cut the wrong line and all of the power in the neighborhood is down, right, or somewhere in between. We make mistakes, but we almost always, if we're paying attention, we learn from those mistakes and Shafi's idea is when you're creating laboratory equipment, you're creating processes that have never existed before, something's going to break it's never been done before. The question becomes, how do we fix it? And along the way, when we fix it, do we actually make it better? So he is actively looking at processes that, you know, maybe they work, could they work better? And the only way to know is to tear it apart. Let's see, what if we put this process before that, what we put this step in front of that step, what if we instead of, we did this, right. And that's what he wants his team to be thinking about whether they actually physically break something or not, do they have the mindset that says one it's safe for me to break something and two, I wonder what that thing could be today. And then how do I put it back together? Adam: (12:07) That all kind of goes back to the building of trust because you have to trust that it's okay that it breaks and that it, you know, it will be put back together. Maybe not the same exact way, but you're building that trust that we've been talking about. Carmen: (12:20) That's right. You know, I'll add another one on there. One of my favorite managers of all time, Mike Tenori, when I was at Bose corporation, during the budgeting process he used to always say, “I can handle anything except surprises. So no surprises”. And I think about that from the making mistakes perspective as well. That making mistakes comes from, it's going to happen. The no surprises comes from, I want you to be trustful, I want you to feel comfortable knowing that I will deal with any mistake that comes up. Just tell me about it. I don't want to learn about it when I'm presenting to the board. I don't want to learn about it when we've gone to the street, we've missed our targets, right? I don't want to know about it when the customer calls and says, this is broken. I want to know about it when you know about it and we'll fix it. And that's another way of really creating trust that says, if I have a problem, I'm going to let you know. Adam: (13:17) So, you know, knowing your why, building trust, we've been talking about this whole time, these are all elements for building a great team. How have you done that whilst, hiring during a pandemic? Carmen: (13:31) It's a great question. I'm really curious to know how long we're asking questions about, or we're going back and saying things that, well I learned that during the pandemic. I think there's been tremendous learning during the pandemic. I've onboarded three people. Two of whom I didn't meet in person for six months. One of whom I knew and I'd worked with at a different place and so we were able to hit the ground running pretty easily, but to your question about how have I built trust? I have spent a lot of time, it's probably the same thing I would've done with people if we'd been in person, but it was actually easier. I spent a lot of time with these individuals that I onboarded. Oftentimes I was on a teams meeting all day and we would have the teams meeting open, which is, which is great for sharing screens right, here let me show you, I could actually demonstrate like strokes on an Excel file. Hey, here's what I'm gonna do, watch what I'm doing, watch how I'm formatting, I'll show you where I'm retrieving. So you could actually see my screen and see what I'm doing. I don't remember a time really where we did that in person in a way that was as easy as it is when I'm at my computer and you're at your computer, right? We might've done it in the conference room, but somebody wasn't able to drive at the same time that I was driving, right. So being together on teams was really helpful. I'll show what I'm talking about, we can talk it through, I'll give you a task and then I'm going to go, not really away. I'm going to go look at my other monitor and work on something else and give you a few minutes to do the next step. Might ask me questions as you go. All right. So we spent a lot of time together on teams working through projects, but I had a plan of what things I wanted them to master in their first couple of weeks or whatever. And along the way, because of this dynamic of the pandemic and we're working from home in a situation, you just get to talking about other things, right? Like for example, you know I have dogs like the dogs will come in the room and they want to meet the person on the camera because believe it or not, they pay attention. Or, you know, somebody's roommate comes in or whatever happens and you just get to talking to people while you're doing the work. So there's a rapport that gets developed by spending that amount of time with somebody. I have been thinking about how I would onboard in person again, I've never been as successful of onboarding employees as I have been during the pandemic. Something about the fact that we are maybe part of it's that we're captive, but I think my style changed dramatically in that it was much easier for us to be in the same space together without actually being in each other's space. And that's something that I think the virtual platform has really helped us and really enabled us to do. Adam: (16:40) I liked that being in the same space with each other, but not being in each other's spaces, giving that room to breathe in a sense, especially when you're a new hire, it's almost overwhelming. Carmen: (16:51) You know, I saw something on Facebook last night, a friend of mine posted it there. They returned to the office as of June 1st. And, they were given, again, everybody's workstation. There was a custom made cookie and the cookie had a microphone with the slash through it. And that cookie said, “welcome back, remember you're not on mute anymore”. And I think that, that's another thing. I think the mute button is actually really helpful because sometimes you need to, you need to just mute yourself for a minute, not leaving, not disengage. It's a very easy way to take a quick break. Wait, I'm just going to, I need to think out loud for a second I'm going to mute myself. Hard to do that when you're in each other's space together physically. So I am, I'm a little conscientious about what happens when the mute button isn't there anymore. Adam: (17:42) Yeah. So keeping, just to kind of wrap up our conversation, keeping that idea of, you know, the hiring hat. When we had talked previously, you mentioned you'd like to hire directly out of college and I'd been reading an article in a team training and development magazine called "Don't hire skills, hire to skill". And they had mentioned, although college degrees can indicate that a candidate has gained certain skills and knowledge, they don't always paint a full picture of a person's talent potential. What do you look at when you're hiring? Somebody maybe out of college or maybe not even out of college, maybe some use in working in the industry for years, but maybe doesn't have the full college or what, you know, what is your view on that? Carmen: (18:24) It's a great question. One I really have thought a lot about over the years, and I've come to realize that regardless of what position I'm hiring for, you know, whether I'm hiring a staff accountant or a senior financial analyst, I have three questions that I ask. And it's interesting because they're actually the same questions I expect somebody who's interviewing me to ask me, right. And my, so my three questions are, 1. How well does this person communicate? Now I know that's a huge question, but I have a couple of things that I'm specifically looking for. I'm looking for, I'm looking for the candidate to give me an explanation about how he or she varies the communication style. So is this going to be a, I'm really good at chitchat? I get to know this person, or I just walk in and I’ve got to get the work, I just have to get the information, right. Both are applicable, right? Both have a purpose and I'd like to know when you might use each. Some responses warrant a yes. Some responses warrant a paragraph, right. So how do they understand the distinction? I'm also looking for the mode or the method of communication and specifically the ability to vary this. Frequently in my career, I've heard somebody say, “well, he didn't call me back or I emailed him, I didn't get the information”. Okay, cool. How are you following up? Well, I emailed him. Okay. Well call him. So then I'll ask later. Well, did you call him? Well, I sent him an email, right? Like that is not going to achieve the objective. So if you've emailed somebody and they haven’t gotten back to you, then call them. If they still haven't gotten back to you, go see them in person or send them a text, right. Find a different way to communicate. And so as I'm interviewing candidates, I'm looking for those nuances. What did they mean when they say they're a good communicator? Give me some examples of what that looks like. It's a big topic on communication and a lot of times pushing information isn't the same as being able to receive information. So how well can this person provide information and receive information? Did you read what they sent you? No, I just filed it. Well, that's not really a good two-way street of communication. So that's the first thing that I'm looking for is talk to me about your communication styles and strategies, right. The second thing that I interview for is how does this person solve problems? And oftentimes we don't really know that we're, we have a process, but when you're in an interview situation, you know, I really probe about, okay, so here's a task that's been put in front of you. Like, what's the first thing you do. What's the next thing you do? How do you get through solving that problem? And I'm looking for things like, well, first of all, like Google all of the words and the requests so I make sure I understand what's being asked of me. I think that's pretty smart. Make sure you understand, get clarity on what the objective is, right. But I'm really interested in this part. How do they know when they're done? Right? What does success look like? Kind of the same thing, because if you understand what you're going for, then it's much easier to create your path. So the answer to that question, when I asked somebody, how do you solve problems? Describe for me how you solve problems. If they can say to me, I want to make sure I understand what the objective is. I want to know what success looks like, or completeness looks like, you know, the balance sheet has to balance like that's important, you know, something like that. And then I create steps that I think I need to take along the way. Like that's a pretty complete answer. A really complete answer is somebody who can say, and if I get stuck along the way I may need to rethink, or I may need to ask questions, right. That's really what I'm looking for there. None of that is taught in school, right? That's all stuff that you learned. You may learn from doing school projects, but there's not a class that I know of that's on problem solving, right? It's all about, here's a problem go solve it and here's some skills to help you. So that's what I'm looking for. And then the third one that I'm looking for, which is probably the most uncomfortable for people in the finance profession is how well do you deal with ambiguity and specifically what I mean about this is a lot of us went into finance and accounting because we thought there was an answer, right? It's a little bit black and white. It's not so nebulous. Well in the corporate world or in the non-academic world, right. We aren't given the information or the variables that we need to answer the question. So we've got to make a lot of assumptions. We have to create a lot of the information that we need. And so how comfortable is someone with that saying, well, I created a model, these are the assumptions that I made, so here's the answer. How comfortable are they with making the assumptions? Because within those assumptions, there's a lot of ambiguity. There's a lot of unknowns. Yet, they are critical to being able to solve a problem, create an output, right, but deliverable. So that's the first one. One is that the data has a lot of ambiguity in it. The second one and probably the one that we're learning the most about during this pandemic is you just don't know what comes next. And for some people that can be paralyzing, I don't know what's going to happen. No, you don't. I don't know what's going to happen next. And how comfortable are you with that in the day to day? First of all, I'm curious if somebody ever even thought about it, because if they thought about it, it makes for a great conversation. Yeah I really thought about how much I don't like not having the answers. Okay, cool. What does that look like? And then other people, like, I don't know, I never thought about it. Which suggests to me that maybe they're just doing some drifting, drifting isn't necessarily bad, but if you don't know where you're going, right. You're not going to have as easy a time getting there. Well maybe I guess we don't know where you're going anywhere will work, right, so correct that. But, anyway, so back to my thought about ambiguity, if they've given some thought to how well do I thrive in an environment where I don't have all the answers, they've given some thought to that and they say I'm really not comfortable in that. Then I wouldn't suggest they work for a startup. For example, I really want to know what my day to day is going to look like. I think there's some jobs where they might be more comfortable. Finance and accounting in a corporate setting, whether it's a public company or pre-revenue company, the unknowns every single day are pretty great. So how comfortable would you be in this role? I think that's really what I'm, what I'm looking for. Right? How comfortable are they in not having all the answers? It's even not all the answers. It's how comfortable are you not having all of the data, right? Because I don't have all of the answers and I've been doing this for a lot longer. I hope that helps you kind of explain my thoughts on ambiguity. Adam: (25:43) No, I think so. Being willing to admit, you know, I don't know everything and that's okay, but I'm willing to find the answer and it shows a willingness to kind of step outside the box and be vulnerable. Carmen: (25:55) Right. And I don't know of a single CEO or board member or probably President of the United States or any other country for that matter, who hasn't found himself or herself in a position of ambiguity. Right? Well, the question is, how much do you trust yourself and the people around you to help get some clarity, such that you can take action. Closing: (26:20) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Bob Kolodgy: https://www.linkedin.com/in/bob-kolodgy-a5849214/About Bob Kolodgy: https://www.bcbs.com/about-us/leadership/robert-kolodgyBob's Interview for Forbes CFO Network with IMA's Jeff Thomson: https://www.forbes.com/sites/jeffthomson/2020/02/07/the-finance-leader-in-health-care-an-interview-with-the-cfo-of-blue-cross-blue-shield-association/?sh=418e829169acBCBS: https://www.bcbs.com/FULL EPISODE TRANSCRIPTAdam: (00:00) Welcome to episode 126 of Count Me In. Thanks for coming back and listening to IMA's podcast. I'm your host, Adam Larson and today's expert guest is Bob Kolodgy. Bob is Executive Vice President and Chief Financial Officer for Blue Cross Blue Shield Association, a national Federation of 35 independent community-based and locally operated Blue Cross Blue Shield companies. In his role, he is responsible for the blue's federal employee program, oversees the national employee benefits administration, and has overall accountability for Blue Cross Blue Shield brand management, and the associations finance, licenser, enterprise information technology, and information security areas. During his conversation with my co-host Mitch, Bob discusses the role of the CFO in building organizations ready for the future. Keep listening to hear his perspective on innovation, data, and value. Mitch: (01:02) So for our conversation today, we really want to emphasize the role of the CFO and making sure that they are capable of building organizations ready for the future. Now, innovation certainly is a term we use often in accounting and finance as organizations seek to create and increase value. So to start off, I would really like to know what innovation means to you. Bob: (01:31) Yeah, thanks Mitch and thanks for the opportunity to address IMA today, it's a great group and I love to be part of your events, so thank you for that. You know, with respect to innovation and accounting, let's put it in perspective and I've always said this at the beginning of innovation conversations with finance people. It's like, well, we don't want you all to be all that innovative, I mean, your accountants after all. And you need to be careful, right? So there's all kinds of, accounting principles and things like that. And we don't want you to be creative with that now, maybe be creative about how you do what you do, right? And so how can you as an accountant, or a finance person in an organization, actually innovate in a way that creates value. And so, when we try to take that apart, I look at value as the sum of three things, cost or efficiency, quality, and service. And so anyone can apply those principles to what they do I think, and add value. And so for me, innovation, particularly in accounting and finance in those disciplines really is focused more on those things and keeping them in balance, right? So innovation can accelerate any one of those things and as long as it does that without detracting from the other two, it's adding value. So for me, it's kind of that simple. And, when you look at what we've been in for the last, 14 or 15 months with the pandemic, it really sort of dots the eye on the need for innovation, right? We had to pivot in so many ways that we never would have expected so quickly and, you know, true innovations have come out of that in many forms and now its a matter of advancing those and in some cases bringing them to scale. There were certain things that came out of the pandemic that were really innovative and they're going to stick whether we expected that to happen or not. The time after the pandemic will be, not like anything we expected or planned on our prior trajectory. Mitch: (03:37) Yeah, I completely agree, among these different conversations that I have, I've certainly seen many organizations who have explained that they will be adapting some of these ongoing principles moving forward and making it part of their business, because of how they had to pivot and adapt in the last year plus. My next question, continuing on this topic, as far as innovation goes and the different components that you spoke about, what is specifically the CFO's role when it comes to initiating this change, enabling innovation and driving the anticipated results, evaluating those results, where does the CFO really make an impact? Bob: (04:16) Yeah, I think innovation and enabling new thinking and so forth is really an area where the modern CFO can differentiate themselves from the more traditional financially focused leader, and if it's done well, the CFO can become the corporation's architect for business value. I saw an article recently from Accenture on this, and I found it very, very interesting and poignant. CFOs are uniquely positioned if they apply certain levers that they have access to, to be able to create this differentiation and be the architect of business value. And just to list off the levers quickly, visibility of the whole enterprise, the CFO typically because they deal with all parts of the company has a view into what is going on in all those parts and the ability to see where synergies exist across those verticals, the ability to do analytics and have access to data across the enterprise is really critical. CFOs, not only have access to financial data, but now more and more operational and market data and, a variety of things that they can bring together to bring insights that are actionable to the organization. Understanding enterprise risk is a critical role that the CFO or critical conversation, or are part of the conversation the CFO can bring, because they can measure risk and they know that you may be able to take risks in one area of the company and balance that off with some protection and hedge and the other areas of the company. The CFO can and should have a strong relationship with all the C-level executives in the company, right? So there should be good working relationships there and the CFO's ability to mentor and discuss things with his or her peers in a way that brings to life this greater business value. And finally the financial authorities, I mean the CFO obviously has a financial authority within the organization and can reinforce the economic basis for investment decisions, right? So the CFO can bring voice to somebody else's idea, in a way that that person may or may not be able to do. And so, these things can really be exploited by better collaboration with C-level peers, by leading in with unique insights, whether it's based on data, unique analytics, perspective on risk, or what have you, and then taking ownership for ensuring that value is extracted from all of the new technology and data platforms. These things are proliferating coming up all over the place. And I think it's the CFO's responsibility to make sure there's a value equation attached to each of those, or if not, make sure everybody else understands that and make sure that expectations are aligned along those vectors and CFO needs to be able to cultivate a good commercial awareness and stay ahead of the curve of the industry, right? So whether it's regulatory change, federal policy changes, the business environment, changing the competitive landscape, changing or just trends and particularly important, I think is understanding what the potential disruptors are. You know, I'm in healthcare, there are disruptors all around our industry, whether you're talking about health plans, providers, pharmaceutical companies, there all kinds of people with great ideas about how to do what we do differently. And so being aware of that is critically important as you try to bring innovation and value into your organization. Mitch: (07:38) That's great and I want to go a little bit further on some of the points you just made right there because many often relate innovation, they hear innovation and think of technology, right? That's one of the biggest things and in the recent year plus we've seen, regardless of the pandemic, some of the biggest technology innovation in accounting and finance has come through automation and the availability of data. So I think aligning our thoughts here on what you were just talking about as far as what innovation really is from your perspective, being able to take advantage of some technological advancements that have become available to us. But really, the value creation that you were just talking about. If it's in healthcare for you or accounting and finance professionals, how do you as a CFO go about harnessing the data, because there is so much of it at this point and truly making or creating value from that data? Bob: (08:31) Sure. You know, health insurance is a huge data business. We have records and you can imagine, Blue Cross Blue Shield provides health insurance for 110 million people in the country. And so we have all the claim records for them, for their medical care and for the pharmacy use. And so we know a lot, but what we know is relatively thin, right? So we know, a person went to the hospital and they went to the ER and had an x-ray and got their broken leg set, but we don't have the x-ray results. We don't have the depth of the diagnostics and stuff that were done in the hospital. So not only are we looking at our own data, which is enormous, but we're bringing in, we call it nonconforming data from other sources, right? So connecting with hospital systems, electronic medical records, for instance, to import data that makes what we have even richer and gives us the ability to do way more with the data. And I'm going to talk about a couple of those things. So just in terms of examples, one of the things that the Blue Cross Blue Shield association strives to be as a thought leader in healthcare. And so we developed this health of America report series that is a data-driven set of analytics and we do publications periodically on different topics. So using our data and the insights from our data to try to identify challenges in healthcare space, right? So last year, maybe it was even a year and a half ago, we did a study on millennials and try to understand their relative health compared to prior generations and what particular health issues were prevalent for millennials and we had some really interesting findings. First of all, millennials are more likely to have some certain chronic conditions and perhaps less likely to live a long and healthy life then the prior generation, which was a startling finding. And then additionally, a lot of behavioral health issues from millennials were evidence which enables us to say, okay, well, if that's a population cohort that we want to take care of and take good care of, then we need to adapt certain things, we need to adapt certain chronic care management approaches that are particularly important for millennials and we need to build a better behavioral health or mental health system to accompany the physical health part, right? And so it's things like that and our ability to take huge data sets and study different population cohorts within them, come out with findings that are creating actionable insights that we can build into our products, build into our service set and so forth to achieve our mission of taking better care of people for the health of America. This whole thing rides on, as I was describing earlier, the ability to combine data from disparate sources, right? So interoperability is a huge issue in healthcare. Interoperability in healthcare is really kind of scarce right now, right? So what I described, it's really easy to say, oh, health plan, it's going to just go to the big hospital systems in their network and they're going to connect with their electronic medical records systems and they're going to import all this deep rich data about people, we're going to go out and buy a market data prism clusters, whatever to understand the socioeconomics of a population and we're going to combine all that stuff and come up with all these rich insights, but there's not a standard and we're working on it. And, again, with our footprint in the industry being pretty big we can help drive interoperability solutions so that data is exchanged in a consistent way that when you particularly hit on data elements and a report, it means the same thing no matter what system you're in and that it's safe and secure. So those things are critical to interoperability and that's one of the underpinnings that we're working on, in terms of our data approach. Finally, I'll call out a few companies, the Blue Cross Blue Shield companies, and there are now 35 of them domestically and hundreds internationally. The 35 domestics that joins to do corporate venturing. And so we're in our fourth corporate venture fund right now with a total of about 900 million of assets under management and I'm just going to highlight a couple of the companies that are in the blue venture fund portfolio that are doing really interesting and relevant things with respect to data. So advocacy insights is a cloud-based data management and interoperability platform that's specifically built for healthcare. So it's able to connect the payers and the providers and the other participants in the healthcare ecosystem in a unique way. There's a company called Alacura, which provides data analytics and network optimization for services about aeromedical transport. So, you see the copiers and the airplanes that are taking people either, with respect to the helicopter, it might be from what they call a scene run. So if there was an accident on the highway, someone's really in bad shape they’ll call a copter instead of an ambulance so that they can get to the critical care center more quickly. And there are a lot of, transports of critically ill people for, transplant operations and high level things where they have to be moved from place to place really quickly. So this platform matches up air medical transport and medical capabilities. And then finally, a company called Prove. Prove provides, mobile focused identity authentication and data management platform, which improves member engagements. It reduces operating costs and streamlines digital processes. The origin of Prove was this two-factor authentication. So, Prove has tons and tons of cell phone numbers in it. So it knows if you're in a call center and you've got Prove kind of bolted onto your inbound calls. It can tell you who the person is and then your system can match that to a member record so that, that call center operator is click, click right into the information about the person calling. So really valuable and it alleviates the need to do some additional authentication when the person calls, right? So, a lot of times you call and they say, okay well, what's your mother's maiden name? Or, you know, what's the name of your first pet you had when you were a kid or something along those lines. So, Prove is another platform that the venture funds have invested in that are really helping us move in this data space. Mitch: (15:05) So it sounds like you have a tremendous amount of data, truthfully more than I could think of, but it obviously makes sense as you're explaining where it all comes from and how it all works together. As a CFO of the organization in being able to share insight like this, it sounds like it's just a tremendous amount of opportunity, right? There's a ton of opportunity with data, but just for our listeners, I think everybody also recognizes with opportunity comes challenges. So when it comes to innovation, this data, taking all of this opportunity and creating value from it, how do you navigate really through these different challenges? And, just thinking back to one of the first points you made in that last response about the health of millennials. The findings that you have from your research must prove to kind of contradict maybe some of the initial forecasts that you've had. So things like that, what goes into really leading your organization for success into the future? Bob: (16:07) Yeah. When you think about that, and particularly with financial people, it's a lot about forecasting. And so we do a whole bunch of financial forecasting, but we do all kinds of other forecasting as well. And I guess for me, the best go-to here is, our industry, right? Health insurance, and I'm going to talk about health insurance in the context of the pandemic. And I think it'll point out some things that we knew and some things that we didn't know, and probably one of the most impactful externalities that we've ever experienced in our professional careers, right? I mean, unless you're a hundred years old, you haven't been through a pandemic before. So, you know, we're not a hundred years old. What happened to us last year, when the pandemic hit was a really, a series of conflicting headwinds. So we had headwinds with our customers and our customers are the members, who subscribe and the employers who generally buy the insurance for that person, right? So it's sort of a two level customer set and what people needed because of the volatility and loss of jobs and uncertainty for business was premium relief, right? So they're asking us, “Hey, look, cut us some slack on premiums for a while”. And we did, we extended grace periods and things like that, in some cases we forgave premium for people that were in certain tough economic times and things like that. So on the customer side, that was one of the first things that came to us. So, from a financial person's perspective, oh, okay, well we're not going to collect this quickly, or we're not going to collect it all. And so what does that mean, and how much is that worth? Then it was, okay, now let's make sure that everyone has access, right? Because the last thing you want when you're a health insurer is for people, your members not to be able to get care when they need it, okay. Because that's what we're here to do. We're here to make sure you can get care when you need it, and it gets paid for. So the ability to accept access testing for COVID, the vaccines when they were available, and just services in general, right? Because the hospital system kind of shut down when COVID hit with all the elective procedures and things like that. And so we needed to make sure that people understood if they were really sick, you can still get in. You need to be protected, you need to be this and that. So it was a matter of waiving copays and some of the economic barriers in our benefit design so that people could get all of the testing and COVID treatment that they needed. And so we spent a bunch of time on there. So that's the customer step. Our supply chain, so to speak, in health insurance is the providers, right? It's the hospitals, the doctors, the drugs, the air ambulance companies, you know, all those things, the PT providers, the surgeons, et cetera. And the way we generally pay our supply chain in the industry is based upon volume, right? So they do something, we pay them, we call that fee for service, right? You go to the doctor, he checks you out, he bills us, or he or she bills us and we pay the doctor. That's called fee for service medicine. But when volume goes through the floor, like it did in March and April of 2020, we're not paying them because there's no service being provided. So providers got cash short pretty quickly and they needed help. So we put providers in some cases on interim payments, we'll pay you a certain amount per month based on what your historical spend has been, for us and we'll settle up later. So we're getting less cash from our customers and we're needing to front cash to those providers who were in kind of a tough spot. And fortunately we have the wherewithal, particularly blue plans are very well capitalized, had the wherewithal to be able to do this at least for a while. So then it's like, okay, well, what does all that mean to us? So I described with that shortage of cash need, we ourselves had COVID related costs that were new to us, right? There didn't used to be that diagnosis, there didn’t used to be treatment, there didn't used to be Regeneron use for people that are impatient, all the ventilator use that was early in the pandemic and all those things were new costs for us. On the other side of it, there was this huge downdraft in terms of the cost of medical care. And so because people were deferring care and delaying elective procedures, there was an enormous amount of reduction in our expenses. And so you put all those things together and try to make a forecast. I mean, uncertainty was just more than it's ever been before, and we'd need to look to the future now and figure out, well what's next. We know what happened in 2020, the big piece of our boss went down, some pieces went up, we also had costs for ourselves because we put our workers remote. So any employer who went remote, we had to add bandwidth, we had to have people get here to set up at home and all those kinds of things so we had all of those costs. But as we look to the future and healthcare health insurance is a long-term play, you need to know what's going to happen because of all the deferred care this year, when we look at the procedures that were deferred, they were largely good preventive medicine. People weren't going to get the care that they typically would get the routine diagnostics and stuff like that, to make sure that they don't have some underpinning chronic condition or some underpinning acute event on the way. So without having that preventive stuff, that good spend going on what is going to happen to people next, and probably what will happen to people next is there'll be more acute episodes, that'll be more expensive and probably damaging to people's overall health status. But we don't know what that is yet because we're still just coming out of the pandemic and the medical consumption while it's kind of at a normal level, it's comprised of a different distribution of things, more COVID stuff and less typical elective and diagnostic stuff. So there will be long-term implications that we just don't know what those are yet, but we're still doing forecasts, it doesn't stop us from doing forecasts. We're taking our best guess. We've got actuaries all over the place, trying to figure this stuff out and understand what's going to happen with the changing utilization patterns. The other thing that happened in the pandemic in our industry, which I think is really interesting, and again, tough to project, the uptake on telemedicine. Because people didn't want to go or couldn't go to the doctor's office, doctors made themselves available to people through things like zoom and video and a bunch of other technologies that actually are good and probably going to be more the way of the future. It won't all be that way, some of it will go back to the face-to-face doctor's office stuff, but there's a fair amount of telemedicine that will continue, and that was accelerated and as a result of the pandemic. And then finally, like everybody else, we're figuring out what this return to office looks like, right? Trying to figure out when it's going to be safe to send our people, what the office is going to look like, who's going to be in, who's not going to be in or hybrid mode, or what is it going to be? And what's the cost of that, right? Right now we've got a bunch of office space we're not using. We have to rationalize that at some point in the future. So all these things go into our projections, but I've been a CFO long enough to tell other CFOs, my advice just be careful. That's all. Know what could happen, do a lot of sensitivity analysis, but just be careful and protect your balance sheet because you've got a strong balance sheet you can weather stuff like this and if you don't have a strong balance sheet, it's going to be harder. Mitch: (23:33) Well, that's really the perfect way to kind of segue into this last question for you here. We certainly covered a lot when it comes to innovation and particularly the past year and a half, a lot of the changes. It was difficult, you know, 2020 and you said the last 14, 15 months, I think we can both agree that there are some positive outcomes that we can kind of focus on, as far as innovation goes and being able to, incorporate some of this into our business as sustainable operations, but just kind of closing thoughts from you, if you wouldn't mind sharing, when it comes to the role of the CFO and again, we're trying to lead organizations into the future successfully, sustainably. What does that look like? What are some of the last thoughts and pieces of advice you have for our listeners? Bob: (24:20) Yeah, I think some of the lessons learned in the pandemic relate to several areas. Infrastructure is one of those and not only within organizations, but within industries, it was fascinating to me to see in a totally unrelated to healthcare per se, but the way the supply chains work in the country created shortages of things that people wanted to hoard when the pandemic came up, right? So all of a sudden, this is an interesting example, but people were hoarding paper products and the way the supply chain was making paper products was a certain amount for industrial use or commercial use in office buildings, institutions, and things of that nature and a certain amount for home consumption. And what happened when the pandemic hit is home consumption went way up and institutional consumption went down and the supply chain wasn't ready to make that pivot. It took months and months for them to normalize that, cause it's the same product, it just comes in a different package, in a different shape for them to normalize that and get it figured out. Another infrastructure piece, and this is a healthcare specific one for the healthcare ecosystem is, the pandemic really put a spotlight on serious racial disparities and access to care. And we've known anybody who's been in healthcare has known for a long time that there are disparities and that people of modest means have a tougher time getting the same access and good health care that people with greater means may be able to obtain. And whether it's the prevalence of COVID in a particular population, which was higher again for populations that were more socially and economically challenged, particularly people of color and one relates to the other, but the outcomes the same outcome, there were many more cases and serious cases of COVID in populations of color. And that is a terrible thing, but I don't think it's a surprise to anyone in healthcare just sort of dotted the “I” in what we already knew. The good thing about it is that we're coming out with a greater focus on some of those things. I'll talk about that in a minute. The readiness of organizations to do these pivots was very unlevel. I think some organizations pivoted really well and others just kind of went out, you know, like almost went out of business and so think about restaurants, right? I live in Chicago and there's a lot of restaurants. Well, there aren't as many restaurants as there used to be. There are some great restaurants that obviously couldn't take patrons or indoor dining and so they pivoted to carry out and some of them did it really quickly, but some of them couldn't do it at all. I mean, you can really tell as kind of a finance person, you walked down the street and you just look at a restaurant that's doing a decent carry out business and one that's just boarded up and I think it again gets back to how much depth they get, right, to absorb that shock. And so being prepared for that is something that I think organizations really need to do and reinforcing the importance of having the resources and frameworks in place to deal with contingencies. Plan ahead, okay. Well, what if, I don't think anybody ever would have done a, “what if” on a pandemic, but you might've done “what ifs” on other catastrophes that would have had similar consequences and understanding if this, then that with your business is just a really, really important thing whether you're a big company, like a health insurance company or an entrepreneur, you know, running a shop on Alstead avenue in Chicago. Some of the positive things I mentioned earlier, the acceleration of tele-health, innovation was accelerated, digital transformation was accelerated because we had to, and I think those things will stick and they'll stick in just about every sector. I mean, think about the volume of things that are being bought through all of the delivery vendors, right? Amazon, whatever, you know, and all the likes of them. And again, we live in the city, you can get almost anything delivered to our house, whether it's food, groceries, supplies, tools, whatever it is, and in a pandemic, that's what everybody did. So the growth there, and I think, again, a certain amount of it isn't permanent, but a lot of it is permanent. And I think that, that in our case, in healthcare at the tele-health conversion was truly one that was pandemic driven to a different trajectory. And then for organizations, you don't realize you have to be nimble and agile at this point, then you haven't been paying attention because so many things happen so quickly. I mean, we took our workforce remote in a week and we decided to do and in a week later, it was done. And that was it. And 95% of those people haven't set foot in this office since, which is pretty remarkable when you think about it. And the ability to do that and continue your business really means being agile and being nimble, and being adaptable. And now it's a matter of resilience, right? So it's a matter of making sure your folks feel connected and that they feel strong every day because they're working in a whole different paradigm than they were before. So, I think, I don't know who said it, but no good crisis should go unattended, and crisis creates opportunity for those that are really thinking and willing to pivot and willing to act and I think that that's been true with this pandemic. There are things that you would never think you would do and people, many people thought just in terms of the office environment, we need to be in the office every day, everyone needs to be here, that's our culture, that's how we roll, that's just the way it needs to be and I think that what we've done in the last 14 or 15 months has shown us, it's not really the way it necessarily needs to be, might still be for some companies the best way, but not for all companies and I think people have found a different way to work. It's going to permanently change the workforce in this country. I mean, think about the idea of more jobs just being remote period, where you never have to go to an office. That puts the pool of potential employees for a company exponentially bigger than it used to be. Because if my company no longer requires people to work in Chicago five days a week, that opens up the entire country to us in terms of opportunities. And it opens up opportunities for people everywhere in the country that they wouldn't have had if they weren't local before. So I think it's really a lot of things here that have come out of this that are going to be decent improvements for us in the future. And everybody talks about back to normal, there's no going back to normal. We're going to a different spot. Not exactly sure what it is, but we're going to a different spot that isn't going to be what normal used to be and it isn't going to be where we are today. So that's what I kind of firmly believe in. That's the advice I would give to the audience. Closing: (31:12) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Professor Orpurt: https://www.linkedin.com/in/steven-orpurt-phd/"Spruce Up Your Learning", Strategic Finance (January 2021): https://sfmagazine.com/post-entry/january-2021-spruce-up-your-learning-skills/Telling Ain't Training by Harold D. Stolovitch  and Erica J. Keeps: https://www.amazon.com/Telling-Aint-Training-Expanded-Enhanced/dp/1562867016FULL EPISODE TRANSCRIPTAdam: (00:05) Hey everyone! Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson and this is episode 125 of our series. How can you spruce up your learning skills and why should you? Well, Steve Orpurt, Clinical Professor of Accountancy at Arizona State University joins our show to talk about how you can become a better learner and the benefits of doing so. Professor Orpurt teaches corporate governance, ethics, and sustainability reporting. His recent research focuses on the statement of cash flows with top tier publications and presentations to the international accounting standards board. His conversation here with Mitch was inspired by a recent article he wrote in IMA’s strategic finance magazine titled, Spruce Up Your Learning. Whether you're a seasoned professional, a young professional just starting out, or a student preparing to embark on an accounting and finance career, keeping current on your learning is imperative. So let's keep listening to learn how. Mitch: (01:08) So we started talking based on your article, Spruce Up Your Learning, in IMA’s strategic finance magazine. My first question for today is how did you really become interested in learning about learning? Steve: (01:20) That's an interesting question. I had an opportunity quite a long time ago 20-25 years ago to work at a startup company that worked with Stanford University of Chicago, Carnegie Mellon, London School of Economics, called younext.com. And when I joined that, they were trying to build an online MBA program and they hired a number of instructional designers. I had never heard of an instructional designer and I ended up working elbow to elbow with them and they taught me a lot about their profession, which is learning. So I've always had an interest since then. And as you know, I'm an academic accountant so I had no background in that area and I've just kept reading and one of the more influential books that I read over the years was a book entitled, Telling Ain't Training by Stolovitch and Keeps. The title kind of undersells the book because it really focuses on learner centered learning, not the teaching. And so that's been a substantial influence on what I do in a classroom. And so from there I just started reading all the research on learning and just kept going. So that article that I wrote was more to help students and others who are interested in improving their learning, most of that material is actually written to a teacher or an instructor to use to help students learn, but I thought it should be put in the hands of the students themselves to improve their abilities to learn. Mitch: (03:05) Following up on that and making a connection to our listeners. Why is it so important? Why do you think it's so important for someone to improve their own learning skills? And like I said, particularly for the management accountant? Steve: (03:17) Well I think learning, which is a skill, is just becoming much more valuable today than perhaps even a decade ago. If you stop and think about the management accounting role, maybe 10 or 15 years ago, it would be fair to say that it was kind of a departmental role, but now it's an enterprise wide role. And you can think of some reasons for that. We can look at things like artificial intelligence, robotic process automation, process mining, blockchain, cryptocurrencies, enterprise risk management, cloud computing, mobile computing, sustainability reporting, sustainability reporting standards. These are all topics that we didn't talk about much 10 years ago or so, and now they're front and central for our management accounting and they require substantial learning. So I think that the role of a management accountant has really moved from kind of a departmental role into an enterprise wide role. And it just requires a lot more learning and learning well, so it's just a more valuable skill. So one of the reasons I wanted to write that article was simply to say, we can learn faster and better. Mitch: (04:38) It's a great point. And, you know, particularly from the IMA perspective, all those topics you just addressed are things that we are certainly pushing out there and are very interested in upscaling or rescaling in order to learn the necessary skills on the job and for the profession, the industry at large. For our listeners who, whether they're familiar with the article or not, when it comes to improving your learning, do you have any recommendations or what's an important learning strategy that you advocate for? Steve: (05:11) Well there are a number of them. I think the, one of the most valuable and one of the easiest to implement, because you can do it right now is to ask yourself questions before you start looking at the learning material. Most of us will pick up an article or something we're learning from, we just start reading and a better approach is to take a minute or so and think through what questions you have about that material. Because when you ask questions, you engage your mind and you read more actively to try and answer those questions. Continuing with that then as you read, you create more questions that you are looking for answers for and so it just creates a more active involvement with the learning and obviously that means you'll learn better, but as it turns out, most of us that have tried this would say you learn not only better, but faster because you remember material, you can apply it better, and if you want more extensive material, you know what you're looking for. So I think this notion of asking questions before you start reading something, and then actually while you're reading it, is easy to implement and extremely valuable habit to build. Ironically, I've had really good success by asking questions before I read articles, because it's led me to actually set aside many articles that once I start questioning, I realized I'm not going to get that much out of it and I'm not that interested in it. So it's actually been a time saver just in terms of organizing material that is valuable to me. And, so again, I think even at the most basic level, this is really easy to implement this idea of asking questions and, very, very valuable in terms of time management, but also in terms of just improving your learning. Mitch: (07:18) So I know myself as a learner, one of my go-to strategies, and I think this goes for many people is, as you said, you just start reading and you start highlighting, you start taking your own notes. How does asking questions in advance and really engaging your brain? What are the benefits above and beyond taking notes and highlighting and simple learning strategies that I'm sure many of our listeners frequently do? Steve: (07:46) Something that almost all of my students do. It's extremely passive. How many of you go back and actually look at your highlights? Almost none of them. And of course I teach intermediate accounting so the whole textbook is highlighted. You're far better off, for example, if you come to a bolded word in an article that you think is valuable, rather than highlight it, write a question about it. What's the definition of this bolded term? What does it refer to in terms of research gap? Anything else? Just any question that makes sense relative to that bolded term and then what I encourage my students to do is actually write those questions on a separate sheet of paper. Have a learning session, maybe in the evening, maybe as they're sitting down to watch a TV show, go through those questions and see if you can answer them. And if you come to that question and you cannot remember the bolded term, go look it up, but almost always you'll find, you'll never forget it, done, you've learned well, and you've learned fast. Mitch: (08:59) So as far as active learning, right, and we had a conversation leading up to our recording here, and I said, for the learner, when we try and offer education through these episodes, we try to scaffold the questions and scaffold the information so that it continues to build. So from your perspective, and for our listeners, can you tell us a little bit about scaffolding and what that means in terms of their learning? How is it beneficial? How does it fit into this active learning opportunity for the students or the professionals who are interested in learning more about a certain topic? Steve: (09:35) It's a good question. One of the active learning strategies that can be very, very helpful, particularly with complicated material is after you've read something and maybe asked a bunch of questions about it, sit down and take a blank sheet of paper, write the concept across the top of the paper, and then think about the various chunks of information that support that concept that helps you to organize the material, supporting that concept. It helps you to think about that concept and all many of the details, support that concept. So you're organizing the material, you'll remember it and be able to use it better. And then what you want to try and do with scaffolding is grow the size of the concept and grow the size of the chunks of material that you're remembering. So let me give you a quick example. If you ask me about ratio analysis, something I've done for 30 years. I would say the concept ratio analysis, I'd write that across the top and I would personally have two chunks of supporting information. I'd say analysis of profitability ratios and analysis of risk ratios. That brings everything back for me. And I could talk about ratio analysis for the next 24 hours with no notes. But if you ask my students, they're going to say ratio analysis is a million details. And so they've got a concept there, ratio analysis, but they may not really understand what it's used for. And then they certainly, because they're just beginning to learn it, they don't have it organized. So if you say return on assets, they're going to grind down through a definition of return on assets. Whereas for me, that's a profitability ratio, one of the many. So the idea then is to actively look at the knowledge that you're gaining and chunk it into bigger and bigger chunks and perhaps bigger concepts. As another quick example, I teach pension accounting. That's a concept to me. And maybe there's one chunk of information under that, pension accounting. But I thought about it the other day and I was like, maybe I have two chunks there too. Defined contribution accounting and defined benefit plan accounting, brings it all back. Ask my students how many chunks they have and they'll say millions. And so they have a hard time remembering it. And I do have some students who will ask me how I organize the material and it's an interesting question to think about, and I try to show them, this is how I think about this topic area. And I don't think it's coincidental that those are the students who tend to do very well on the exams because they're well-organized with their thinking when they go into an exam and they're under a little stress, but still they've got the material organized. Mitch: (12:57) It really is fascinating and, you know, just like I said, being a lifelong learner myself and my job, really focusing on delivering education, identifying these buckets, right? These chunks of information and supporting them, throughout the design, we were talking about instructional design earlier, it's really all part of it. And just building this framework for you to truly understand the components of something, it's really valuable. And from a listener perspective, a learner perspective for this podcast, I'm sure there may be questions as far as, how can I apply this on the job, or we have individuals who I'm sure are studying for the CMA exam, right. And they're interested in getting their certification, maybe it's their continuing education to maintain their certification. So I guess to kind of wrap up our conversation with all this in mind, do you have any other suggestions for our listeners when it comes to sprucing up your learning or learning about learning better practices? What else do you suggest our listeners try to implement? Steve: (14:04) Well I mean, with this notion of scaffolding, one of the best questions that learners can ask is, oftentimes, they're learning with a professional, somebody who's an expert and has been doing, working in whatever area they're learning, ask them how they organize their material. How do you think about cryptocurrency? How should I think about cryptocurrency? And you'll discover how an expert has organized their concepts and their chunks that can help you tremendously. There are a couple of other really easy to implement ideas that my students find successful and I've found successful. One of them is, you know there are clearly times when it's a little hard to get going. You know, you open your learning material, maybe a book that's pretty dense, and it just takes you a while to get going. You're just not in the mood or distractions, things like that. One strategy to get you going is to just read cumulatively. What that means is you'll read literally the first sentence in a, maybe a textbook, then read the second sentence and ask yourself, how does that second sentence relate to the first sentence? Answer that question, go to the third. It gets you going and pretty soon you're reading a paragraph and asking how this paragraph relates to prior paragraphs. Then you're reading a section, how does this section relate to prior sections? And you're starting to really organize the material, but it also is just an important way to get your mind activated and get going and get learning fast. And then as you well know Mitch, a lot of habits, and this is a habit and a skill. It helps to just start small. And so what you might do is say today, I'm going to find an article three to five pages, something that I'm interested in, and I'm going to ask questions about what I hope to learn from that article. Then go read it to try and answer those questions. Ask yourself a few more questions as you go through it, no highlighting start your habit. And my students, a lot of them have adopted these strategies and they'll come back and say, yeah, that's a two thumbs up. It's helpful. Closing: (16:44) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Andrew Warner: https://legendarypodcasts.com/andrew-warner/FULL PODCAST TRANSCRIPTMitch: (00:05) Hey everyone! Welcome back to Count Me In, IMA’s podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong and this is episode 124 of our series. What happens when marketing, finance and data analytics collide? Well, in today's episode, Andrew Warner CEO at Marketing CFO uses his unique mix of experience in both finance and marketing to help explain how companies can combine these efforts to create a sustainable business. Hear him speak with Adam about bridging accounting and marketing as we head over to their conversation now. Adam: (00:43) Now Andrew, I've been really looking forward to speaking with you as, I been wanting to know what is a Marketing CFO and how did you get to this place? Andrew: (00:53) Sure. So, Marketing CFO is really something that, is something that I've kind of invented just because of the unique need that I've seen in the market. I think as you know that, there's a lot of data in finance and it's very easy to approach that from an analytical perspective and that's how a lot of accountants and finance people typically will approach most problems. But nowadays in marketing, you're getting to where you can track so much spending and the results and there's so much there that it's almost to the point where it's more of a finance type role than a creative role. And if you can kind of combine those two sides of the world, the marketing side with the finance, there's a lot of potential that gets unlocked for the companies that you work with. Adam: (01:40) That really makes sense how marketing and CFO kind of collide. How did you get to this role? Andrew: (01:46) Well to be honest, it was a bit of an accident. So I started out in the finance world and I was working in a accounting firm, probably like a lot of your listeners work at, and on the side I had some e-commerce businesses mainly focused on drop shipping products and there's a lot of digital marketing involved and so I actually had tempted to leave the finance world to go into that industry. I had a small exit with an e-commerce store that I owned and started consulting on the digital marketing side, but what kept happening was that a lot of my clients, even though it was supposed to help them with the marketing, I kept getting pulled back into the finance world. They didn't know if their advertising campaigns were profitable. They didn't know what their business goals were and what campaigns fit into those and which ones didn't. They had cashflow constraints and inventory issues. And so I kept fighting it for a while, I was trying to avoid going back into finance, but about three years ago I just accepted it and have been serving in that role as kind of being the bridge between those two worlds. Adam: (02:52) That's interesting how I think we all kind of fall into our profession by accident a lot of times. So many times, accountants, marketing is just another line on the income statement, but a lot happens to get it there on to the income statement. As you just mentioned, how you kind of fell into the Marketing CFO, you know, how can a CFO better connect with their company to be more effective in making sure that everything is connected? Andrew: (03:24) Yeah, that's a great question. And what's so cool is that 20 or 30 years ago, if you'd asked me that question, it would have been a much different answer and it would've been really tough for a finance person to understand everything that's going on in the marketing world, but nowadays there's so much data and there's so much information available and it's very, it's moving more and more to being quantitative where you still, it's still great to have that creative and qualitative and understanding of the mind of your customer, that's still really important for marketing, but you can also start measuring your metrics. And that's one of the things that I do a little different than most CFOs, is that just like you said, instead of marketing expense being an expense on the income statement, I normally start with the, before getting to the revenue, looking at how many users are you getting, how many new potential buyers, how many leads are you getting, and what's your conversion rate at closing those? And I think that that's really where the story needs to begin and that really hasn't. Traditional finance hasn't had a good system for tracking that and catching it. And so I think that's something that you can't really rely on the double entry accounting built in the 13th century to really help with that. But I think it is something that's essential for a CFO to focus on. Adam: (04:40) So that’s not the first time I've heard you mention like the double entry 13th century accounting, when you and I were talking before we started recording, you'd mentioned it a few times, is that still the foundation of what management accountants will face today or is, are things changing? Andrew: (04:55) Yeah, I think the cool thing for management accounting is that it really does change a lot and it really, instead of having that standard financial reporting that is, you know, gap or whatever else, when you're on the management side you're really trying to help the business grow and there's so many other pieces there. I think that the principles have stayed the same. You always want to find your constraints. You always want to try to, maximize efficiency, maximize the return on any investment that you're making. I think the big change has been that there's more data to tell you what your return is, what your investment has put forward. And I think that you have to go a little bit beyond the traditional accounting world to be able to do that. And I could probably walk you through some examples, to really show that in a different light, but the, it is really cool, that the 13th century bookkeeping system has really just with a few slight tweaks, has continued to serve our world so well. I'm not against that system by any means, but I do think you need to add some other pieces on top of that if you want to have a holistic picture of modern business. Adam: (06:07) Well, can you give us some of those examples to help illustrate that for the audience? Andrew: (06:12) Yeah, sure. So I think that, a few things you can look at, so a lot of times people will focus on the constraint of inventory, right? And so that may be something if you're in a manufacturing company and you're trying to focus on where's the constraint, and it's almost like you might have a constraint first approach to resolving that. You could also do that with the marketing side of your business. A lot of times I see people that they're really great at getting traffic to their website for example, but they do a terrible job at converting those visitors into customers, but they continue to focus on just getting more and more people when the real constraint is that conversion rate. And I think that that's something that's really a key component that a accountant could really understand well and that they can, they have that mindset to where they could really serve a marketer or just serve the business in general to better understand where is that constraint. Maybe even get more specific into specific areas, specific web pages if it's a website, specific customer targets if it's more of like a traditional Salesforce type system and then I'm starting to track that over time and seeing what the trends are and trying to determine what the levers underneath that data you can pull to really help improve that over time. I think all that's some great examples for how you can take the principles from traditional management accounting and apply them to this new digital marketing kind of data first world. Adam: (07:38) So it almost sounds like your data is more than just the numbers of like finances that are coming in, but you're talking about, customers and leads and all these different things. So the modern CFO needs to be able to understand all of that. Andrew: (07:56) Definitely, I think so. I think it would just be tough for a CFO to really understand just by looking at that one line item called marketing expense, and really understand what is it that's driving those changes in the revenue? What is it, how can you improve that spend, where are the constraints in getting to revenue? I think that it's just essential to do that. Adam: (08:16) Now we've talked, you and I have talked a number of times before we got to this conversation and you've mentioned to me, Ray Dalio and he has a book called Principles. And there's a quote from that that really sticks out, “principles are fundamental truths, that service foundations that get you what you want out of life. They can be applied in a similar situations to help you achieve your goals”. Now you've mentioned this quote to me, how does that kind of bring together what we've been talking about today? Andrew: (08:44) Yeah, so I think that Ray Dalio's book, Principles was ahead of its time, but the perfect time to implement that is now. And so what he did in the 80s and 90s, is he really solidified for his team here is what we do when the data says this. So if this changes in the market, this is what our system is going to be. And they would spend several hours for each individual little process, trying to understand that 100% what that would look like. But it was tough back in the 80s and 90s for most traditional companies to find that data and in finance, he was looking at different pieces of the market. And there was a lot of financial data there, but there wouldn't have been as much marketing data in a modern business back then. I think you can really take that same approach and say, you can almost have it to where the data runs your business for you. You can get to the point where if the data changes in certain ways and you have a predefined method to where you say, okay, going back to that example we were talking before, if our conversion rate for this particular customer segment goes down, here's the corrective actions we should take and the investigative actions we should take to immediately investigate that and really just build that feedback loop so that you can constantly improve and I think that's the direction that accounting's going to move into. I think there's so much data and it's so easy to convert. You know, a lot of times I've built dashboards for people before and I'll build these beautiful dashboards that I'm so proud of and then I'll look at the usage stats and people rarely use them, you know, they're too busy, they're, you know, it does take time to look at the dashboard and convert that into action. And a lot of times we put that on the managers to determine that and take that next step. But I think the next step for an accountant could actually be to say, if the data is changing in a certain way, and we have a predefined action step, maybe you can connect a tool like Zapier or power automate and automatically trigger a task in a task management system and that's actually some of the things I'm starting to do for my clients, but I think that's another thing that's right around the corner that's completely from the Ray Dalio's Principles mindset, but I think accounting and finance is just poised to really exploit and push that to its max now that we have all this data. Adam: (11:07) So does the modern accountant need to be a data scientist? Andrew: (11:11) I think so, but I would also say that I think the modern marketer needs to be a data scientist. I'm afraid we're getting to the point where almost anybody is going to have to be a data scientist at least to some extent. Adam: (11:21) So how do we get there? Andrew: (11:23) I think you can start out with some pretty familiar tools. I think that pivot tables and Excel can get you really, really far. And I think that's a great place to start. I think the most important thing that a lot of accountants actually miss is knowing what to do with the data. So okay, if this changes, what's the next step, and I think you can get to the point where you could connect your accounting system to some sort of management system and I think that that's really where you can almost be a data scientist that understands the accounting numbers, but then it's helping to translate that data into the next action step for a business and I think that that's maybe the most beneficial, the highest leverage point for an accountant these days and it's something that's really proactive and would set you apart from the traditional accountant for sure. Closing: (12:14) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Tracy Jackson: https://www.linkedin.com/in/tracydjackson/FULL EPISODE TRANSCRIPTMitch: (00:00) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host Mitch Roshong and I'm here to bring you episode 123 of our series. Many businesses have had difficulty and/or needed to adapt to the way they onboard, train, and culturally integrate new hires following the lockdown and virtual shift to the business landscape. To explain how organizations can overcome these challenges and better help their employees become and remain part of the team, Tracey Jackson joined my co-host Adam for a conversation about the training and culture gap. Tracey is an engaging and energetic financial and accounting executive who serves as the CFO at CVR Energy. With over 25 years of experience across corporate finance, risk management, accounting, IT, and FP&A, she has developed extensive team building and change enablement skills. Keep listening for her insight as we head over to their conversation now. Adam: (01:03) Onboarding is something that can be very difficult with or without a lockdown. How has that impacted entry-level employees, especially? Tracey: (01:18) I think it's been another challenge on top of something that's already very challenging for organizations. Organizations, some do this very well, although not many, and some have continued to struggle with it even though there've been so many studies that show that getting someone hooked into the organization and integrated into the culture is part, the first step in successful retention. And I think the pandemic just gave us a curveball on something that was already very difficult to achieve. I can say that we've done some things very well and we've continued to fumble in a lot of different areas and the prep work that I did for the podcast actually gave me a lot of things to think about in terms of what we can do better. Specifically, a lot of our new hires come in on day one to the office even though quite a few of our employees are still at least on a split schedule, 50/50, and there was a lot of appreciation for that moment where they're in the office and they can see what the home office looks like, get their badge, hear about the company's goals and objectives in an onboarding session that HR hosts, meeting with their boss, if their boss is in the office beyond that, when people have received that initial landing, sending them back out over the last 12 months to work from home for an undetermined amount of time is where we really had to swiftly adjust. And I can say across the entire organization, we've done some of that well, and some of that not so well. The things that have been successful, I used to do a monthly luncheon with all of our new hires. It doesn't matter what level of the organization you are, I just felt like it was important to sit down with me and demystify the executive leadership team a little bit and talk about us as people and how we feel about the organization, what's going well, talk about our industry and I had to transition away from that obviously, and what I replaced it with was a webcast, that we do. And we haven't really been hiring as many people, so we haven't done it every single month, but every other month or so we get all the new hires are invited to a webcast with me and they can ask whatever questions they would like to ask of me about my personal life. I'm very, I'm an open book so, and I'm a divorcee and I have three cats so I might be a crazy cat lady, but, you know, really just making sure they know that we're all human and that we're real people because they don't even see us now. At least before I could go down to one of the floors that my folks were on and wander around and they could lay eyes on me, but now all they hear is my voice. If we talk on a conference call or on the phone for something, and then quarterly at our town hall meetings, which also had to change format, we used to do those in person and now we do a webcast for those. So lots and lots of challenges with just helping people feel like they've actually joined a new company and a new culture and understanding, why we do what we do and what our values are. Adam: (04:52) Yeah it's gone from having that personal touch of the face-to-face to a phone call or seeing somebody's face in that little box on the screen, you really lose that human connection. So you have trouble feeling like you're a part of the organization now. Tracey: (05:05) Now one of the comments that I got from someone was that they, now that they're back in the office, this individual has their own office so they can shut the door on and so they feel safe, so they're here quite a bit and then as the staff that are in cubes have been rotating in and out, they've been trying to introduce themselves to these people that they've maybe never seen before and they've been startled to find that these are actually individuals, some of them, that they've had extensive conversations on projects, but they had no idea what they looked like. So it's definitely changing the way that we interact with each other and form our persona of people because when you only have a voice paint your own picture, and when you see somebody in person, you have so many more cues as to what really makes up that individual. Adam: (05:57) You know, you've already mentioned some of the things that your organization has done. What are some of the things that you can do to help these employees? Because even when you're in person, we lose the facial cues because our faces are covered up by a mask. Tracey: (06:12) Right, and this gets to just a personal philosophy. I have found that our productivity shifting from a hundred percent in the office to nearly a hundred percent out of the office was not negatively affected. If anything, we may have been more productive and my personal opinion about why that is, there's less water cooler talk, which is not necessarily a good thing, but it sure does take away from wasted time. And you, we didn't have hardly any HR issues over the last year like we would have had in the past, because we didn't have cube mates bickering over things and we didn't have silly HR scuffles that we had to deal with. They were bigger picture issues about caring for a sick loved one and how did that impact their work schedule when they're at home. And so anyway, my personal opinion is that we have to make this adaptation on a permanent basis because efficiency and productivity and lease space and all of those things, companies are going to figure out, I can save a ton of money if I don't have to lease five floors in a building. And so, things that we can do to help bring them into the fold, I think really fall to the individual's manager and the individuals commitment to come into the fold. A lot of the past has been the expectation that companies feed new employees, copious amounts of opportunities to learn and integrate and interact and become a part of the culture and do networking events and volunteer events and that dynamic, that entire landscape is gone now. And so one, we have to train our managers better about the importance of bringing someone into the fold. And two, we have to express our expectation that the employee has an obligation also to buy into the new way and be willing to do, whether it's webcast events with their entire teams. And we all, I think at this point, everybody has a camera. Whether it's on your computer or not, you still have your phone and nearly everybody has a phone with a camera on it at this point. So participate on webcasts and help demystify what people look like. Don't get on a webcast and not show your face because we don't know what you look like, we don't know what you're thinking and you may be, you know, sitting, doing your emails instead of being present as present as you can be and with the conversation and the individuals, because you do get those facial cues and I mean, people who participate in webcast with me know that I'm extremely animated with my face, I talk with my hands, I can't sit still, but if you never turn on a camera, people don't know that about you. So participate when the opportunities are given to you as an employee and ask questions. If there's something that we're not doing, make a suggestion. I think one of the things that helps the human species live this long is that, you know, if there's a problem, somebody says it out loud and then people work on it. But if you as an individual choose to never say anything didn't go well. We don't have the opportunity as a company to try and continue the adaptation that we need to be going through. Adam: (09:41) Definitely. I think you've really touched on a major point of cultural integration and part of a new company. And when you're a new hire and you're hired virtually in a remote environment, you can't get into the fold, you can't become a part of those water cooler conversations that you are, that you don't get to hear all the gossip and all the things that are happening, not that those things are good, but a lot of times, those things are part of the integration into the company. You hear about what so-and-so is doing, what happening there, outside of, you know, the day-to-day operations, you get a part of who's who and what's happening and so, some of the things you mentioned of like, what you used to do is like kind of demystify who the senior leadership is. What are some ways to get away from the traditional face-to-face interactions and how do we adjust getting people into that culture, especially now, you know, one of the big things you already said is turning your camera on. I worked remotely for a number of years and no one ever turned a camera on. Now that everybody's remote, everybody turns the camera on and I love it. But how do you get people to kind of get into that mode of turning their cameras on and, and other things that they can do to kind of integrate into the culture, outside of, you know, just your day-to-day activities. Tracey: (10:48) Yeah, it's interesting. I think there's a little bit of self-awareness that has to happen when you turn a camera on. I know for me, I mean I get dressed up every day for work, but a lot of these folks that have been working from home for months at this point need to get out of their pajamas in the morning and dress like you're going to go to work because you are going to go to work, whether you move from one room to another room or you get in your car and you drive there. And the other is just being able to look at yourself because you see this little tile of yourself, and you're not used to looking at yourself all the time and that can be startling. It's kind of like the first time you hear your recorded voice and you're like, I don't sound like that. Well, yeah you do, but not in your own head. And so for instance, I had no idea so much of my hair was white. And so this has been extremely startling for me, but I've just sucked it up and gotten over it. I've earned every one of those gray hairs. So I think there've been a lot of creativity that has come to the table. For instance, I host a women's leadership group here at my company and one of the things that we do, we used to get together in a conference room over lunch, and we would read a book together or talk about somebody's specific challenges and help each other solve problems and really create a support network outside of the normal people you interact with every day. And, we went virtual and went to the webcast and decided that, one of the meetings that we had would, we wouldn't do anything serious, we would play games. And so we did, we were 30 something of us and so we had to break up into smaller groups and use the breakout functionality that you have on some of these, tools that allow you to zoom or webcast or teams or whatever you use, they all have that functionality and play, because you learn about people and their past and their experiences through play. We did it on the playground as kids, we did it at happy hours when we could still get together and we just have to do it differently now. And so, you know, wine tasting events, I participated in many, many of those with my memberships in various locations around the world. But there's no reason why you can't do wine tasting with whatever organization. And some people used to not want to do things with their peers in off hours times because they wanted to get home and spend more time with their family while they probably, at this point, have had enough time with their family that they would like a break and getting on and doing a wine tasting with each other and you learn about people's trips and the fun things that they've done, and that can be humanizing. And I think now more than ever, we need that because we forget when we see each other on the streets and people are all wearing masks and we're all literally walking across the street and getting on the other sidewalks so we don't have to walk next to each other, that we're all still people and we need to make those efforts in all different aspects of our lives. Adam: (14:08) You know, that's super important. I know my team has done like one of those wine and paint things and we sent everybody the supplies, we were all in the zoom doing the painting with the person, and we've done virtual lunches where everybody goes out and buys a lunch, or like Uber eats to deliver lunch to their house and we all eat lunch together and chat and, we're able to connect. We've been so focused on work and you can just get lost. It's nice just to remember that we're all human and we all have different issues going on, whether you have kids or don't have kids and we all have so many different things that we have going on that we deal with each day. Tracey: (14:43) Right, right. And, to that end, I think some of the things that we've done in the past or chosen to not do in the past, like mentor programs, lots and lots of companies have done mentor programs and some not so successfully and some successfully, because I think you have to want to be a mentor to actually mentor people effectively. And so when you come into a new organization, we don't really know your personality and we don't know anything about you, but even if we just simply asked, do you want us to give you a partner, an integration partner, don't even call them a mentor, those develop organically, but you know, do you want a partnership with someone who's been here for two, three plus years, that when you're stumped on any topic you can reach out and they can help you think about what you should do, who you should reach out to, and give you some perspective into the lay of the land that you don't have. Adam: (15:48) Yeah. I like that integration partner that's a better way of saying it because calling it a mentor almost seems forced. Tracey: (15:57) Right, right. And mentors, that's a hard role because you have to, mentorship is both delivering good news and bad news and helping people deal with problems and challenges and, that's not necessarily the role we want somebody that's helping you integrate into the company to take on. Adam: (16:18) Yeah. So speaking of like integrating the company, a lot of times when you come into a company, there's a lot of learning that has to happen. You know, and some things I've been reading is a lot of companies are moving to self-paced learning to kind of help employees with training and development. But when it comes to like a professional who's like fresh out of college, this learning's going to be ever more crucial. How can teams prepare so that there's no lack of support, but they're also learning, you mentioned a integration partner, what are some other ways that we can get people up to speed so they can help support the team? Tracey: (16:47) That's a great question. And I think it's a huge concern and at the risk of outing myself, I will say we had some new hires that were right out of college and had only been on the ground working for a couple of months. And then suddenly we're working in a remote environment that are now back in the office on a 50/50 basis and we're seeing the impact because, you know, having come through the organization, so many of my leaders can see where those individuals are in their development and, they're not where we would have necessarily expected them to be if they'd been on the ground every day. So the ability to, you know, be a gopher where you stand up out of your cubicle and look over the wall and ask your cube mate, you know, how do I do this thing that is probably pretty simple and you wouldn't want to ask your boss, is gone and we've done a huge disservice, not addressing a problem I don't think we realized we had and so that is going to be, it actually is already a topic that some of my leaders are talking about because that hallway problem solving and being able to sit together in a cube and stare at a spreadsheet is gone. And even if you're both in the office, you can't sit in the same cube and stare at a spreadsheet anymore. But, you know, Microsoft gives us platforms where you can screen share, and we all are now wearing headsets and so you can still do those things, but there's more effort involved in doing those things. I do think that one of my, financial teams did that was really interesting is they just opened up a bridge in the morning and they're all signed onto the bridge and it's just a telephone bridge and they can talk to each other as if they're all together even though they're not, and otherwise just keep themselves on hold and then, you know, you can drop off or come back on for breaks or lunch or, you know, conference call you have to take, but there is a bridge there that somebody is sort of always sitting on and so you're never really alone. There's always that network there to pop into and say, Hey, I'm stuck on this. Or the other thing that has, has come up is really the IT side of integrating one of the, one of our new hires gave me a lot of great feedback. And they're in IT and basically said, you know we didn't even teach anybody when they were onboarded how to open a service ticket or who to call because it wasn't part of onboarding. It was just something you could always ask a cube mate when you had your first problem and that's when you learned it. And so we are going to start having an IT onboarding because every department has a unique set of applications and tools that they use and different people that you may have to call in IT, to get that quick help versus something serious enough to open a ticket for and try and solve through a formal process. And even simply publishing a list of people and handing it to them on the first day of, you know, here's the Microsoft office guy if you can't get signed in, or you have some problem that's quick, just call him. And if he thinks it's a bigger problem, he can tell you to open a ticket for it. So it's changing everybody's behaviors, the people that are here already, and the people that are stepping into bold around what do I really have to do to help onboard somebody into the culture and the day-to-day swim lanes that we're all in every day. Adam: (20:30) That's great. Yeah, it's going to change how we look at things even once people are back into the office, even more I think, because there's so much that's happened that it's like, wait, we've identified all these gaps, now if everybody goes back into an office, if that even happens in the future, you know, you've already adjusted how you're onboarding people even now. Tracey: (20:52) Right, and we're finding, we have a ton of remote learning capabilities that we just don't use and we're starting to use. One of the things that we had started long before the pandemic was a monthly lunch and learn and we harvest people out of our organization to teach us all kinds of things and it can be as simple as, I think this month’s lunch and learn was organization skills because you're not in an office anymore in the traditional sense, you're at home. Hopefully you're not working at your dining room table, but you very well may be. And so you need a portable, organization strategy so that in the morning you can land there and then in the afternoon you can get out of there because your family's coming to the table later. And so we actually asked one of our executive administration folks to walk us through just basic organization skills, not just paper organization, but email organization, and calendar management, and phone contacts and things like that to facilitate a more organized virtual environment and as well as just physical environment so that you can be portable if necessary and be more structured. But we also need to leverage like ADP. ADP has a module, a learning module, that you can self-populate, but you can also connect to other platforms and pull in. And so one of the things that I've asked my leadership team to do is put together, based on all of the libraries of virtual learning platforms that we have out there, what are your top 20 things that you wish everybody in your department had done and give it to everybody, but also give it to the new hires as they're coming in the door and tell the people that are there, Hey, we'd like you to spend an hour or two a month minimum and take the time to do some self-learning. And it's really, again, incumbent upon the individual to put forth the effort to do that. Before we used to say, here this is mandatory training, but we can't necessarily control what you're doing at home anymore. Closing: (23:04) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Arno Wakfer: https://www.linkedin.com/in/arnowakfer/Arno's Articles: https://www.linkedin.com/pulse/make-everyday-value-creation-day-arno-wakfer-ca-fmva-/  https://www.linkedin.com/pulse/finding-your-value-creation-opportunity-gap-arno-wakfer-ca-fmva/  https://www.linkedin.com/pulse/why-finance-needs-ask-questions-getting-closer-arno-wakfer-ca-fmva-/  FULL EPISODE TRANSCRIPTMitch: (00:00) Hey everyone. Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host Mitch Roshong, and I'm here to bring you episode 122 of our series. Today's conversation features Arno Wakfer, a former CFO with over 15 years of commercial finance and general management experience. He is now a coach and trainer focused on upskilling managers and professionals through learning programs in Power BI and business finance literacy. In this episode, he talks with my co-host Adam about value creation and how finance and accounting professionals can get closer to the business through insight and storytelling. Keep listening as we head over to their conversation now. Adam: (00:51) So Arno, what are some of the value creation ideas that the finance and accounting team can use to set reminders and form habits? Arno: (00:59) Thanks Adam, thanks for the question. I think before I go into that, I'd just like to share my own view on what I think it means to drive value in a business. To simplify these, that I think whatever finance does will contribute towards increasing the value of a business for its stakeholders. Any business, any stakeholder business, wants an asset that increases in value and I think finance should be there to help increase the future value of an asset, which is the business. Alright, so looking at some ideas around finance creating value, some ideas around that. So the first thing I do is looking at financial analysis. So what they can do is they can perform business off assessments and troubleshooting risk areas. The second one is cashflow improvements, you know, working with businesses to improve strategies, to improve the cashflow. There's many strategies that you can use to accelerate in delayed cash flow coming in and out of a business. And we all know cash is King and it keeps the doors open so we need to protect our cash. The next one is cashflow forecasting. A lot of business is done with forecasts, when it comes to cashflow I think it's vital. You need to do at least 12 weeks of cashflow forecasting and try and at least have a safety of margin of at least three months of your fixed overheads, just to give you a little bit of buffer in the time that the business struggles. So that's another way that you can create value. Maximizing profits, monitoring all the key drivers in the business that generate profits and measure that in real time if you can. And then, any early warning signals when anything's off track is not on track that management can address. The next one would be, I think where we can also add as early is auditing spreadsheets. I think a lot of managers use their own spreadsheets to make decisions on, and we come across spreadsheets that can have errors in them and those errors lead to poor decisions. So I think finance can be more involved in analyzing and checking those spreadsheets for correctness. The other idea is to, for finance to get more involved in data analytics, you know, being able to use it’s auditing data into analysis and to be able to analyze underlying transactions or key activities that drive business. For example, if we want to analyze where we bleeding on profit margins on a specific customer, on a specific product, on a specific location, I think finance should be able to analyze and give that intel financial intelligence to key decision makers, which will assist the future planning and strategy. And the next one is data visualization, which is becoming a hot trend skill in finance and accounting is being able to turn data into storytelling. Most of us are visual learners. When we see a picture it explains a story to us and I think instead of just pushing out financial reports, we can spend more time on actually visualizing and storytelling the performance. And with that, you can use business intelligence like Power BI, which is the top-rated business intelligence platform in my opinion, by Microsoft. The next one is finance literacy training. I think finance can help educate non-finance people in business about the numbers so that they can just make better business decisions. Finance speaks a foreign language to most because we understand the numbers because we've been taught that and we work with it every day, but non-finance people don't. So we need to be able to remove all the technical jargon and try and simplify the numbers for different levels of management so they can just help make better decisions. The next one is business metrics and KPIs. I think we need to work with business units through finance business partnering, to be able to define what metrics they use to make decisions. Every person's got different inputs that they need to put the full cost and their budgets together and draw strategy. So work with the business units to develop the business critical KPIs and then have regular interaction with those people to monitor those KPIs. Then we can also do businesses systemization. So, I mean, that's processes systems, improving those to create efficiencies and automation in business. Businesses want more, they want to do more with this and I think finance can help create those efficiencies in business. Alright, so that's kind of like, the key value creation ideas after I liked it that I think would add value to business. Thanks Adam. Adam: (05:31) Yeah, so I think those are wonderful ideas and now that we've kind of covered those ideas, what are some of the challenges that can prevent those same professionals from delivering value creation? Arno: (05:43) Yeah great, great question. So, the obstacles I see finance have in terms of driving value creation. Cause it's easy to say let's drive value, let's do more, but it's, for me, it's a change of a mindset. And what one is to focus on first is the need to find ways to speed up the month-end reporting process. I think before finance looks again, they're spending time on reporting again, and then when they finished the next reporting cycle starts. And reporting is looking backwards, it's not looking forwards. So, I think we need to look to find ways to do more frequent recons, to be planning and eliminating bottlenecks in the month-end reporting process, so that's the first thing. The other thing is the obstacles you'll face is the company culture, its that people don't necessarily like change. And when they do happen, they're not supported by the right people. And then people are not very clear while they're being implemented and they don't really understand the benefit to them in the business. So typically what one would need to do is cost versus benefit and being able to negotiate and be persuasive as to why we need to make changes to drive value creation. Next one is not having the right finance team. You can put all these value creation activities in place, but if you're not driving, if the leader of the team is not driving the right behavior and getting a mission statement of the finance team that's aligned to the business mission statement, and if it's not alarmed, then you're not going to be, the team's not going to be productive. A busy finance team is not necessarily productive finance team and businesses want us to be more productive, to provide more insights rather than just financial information. Next one, you know, inability to influence decisions. I think that is what finance business partnering is all about is being able to take information, provide insights, and influence decision-making. But you're not going to do that behind a desk. You need to be out there building relationships, getting to know people, getting to know the decision makers and actually understand the pain points of the business and what info they need to make better decisions impacting the future of the business. The next point is lacking of systems to provide meaningful insights. You know, businesses want information real-time these days, they can't wait for information. They need to make faster decisions, to drive the business performance, that's the reality we facing. So you need to implement systems to create efficiencies and do things faster and smarter. And I would say the last thing is the of lack of business knowledge, not understanding the key value drivers. I think finance accountants may get too technical about the numbers and they don't really understand the business model, what's driving revenue and profit. It's cost structure, it's values proposition, the mission/vision statement, it’s purpose, all those things. It's key customers, key suppliers, those things. So those are what I would say is like the key challenges that you need to overcome, get your mindset right. And they all can be addressed. You just need to just prioritize where you focus or where you're placing your efforts. Adam: (08:53) I think that's a nice segue. I was going to ask, how do you assess if you're spending time in the right areas? Arno: (08:58) So that, it's so easy, it's all about time management. It's easy to say that you need to better manage your time, but the only way you can do this is to check actually where you're spending your time. So that's why I've come up with a concept called “value creation opportunity gap”, and it's very simple. You list all your day-to-day activities, your normal activities, and then you list all the value creation activities. The things that you should be doing that draws value creation. And there, so for example, you've got a 40 hour working week, and lets say you spending 80% of your time on day-to-day activities and you want to spend say 60% on value creation activities. Then you can already identify where you spending, where need to drop time to dedicate more time to value creation activities. Now day-to-day activities I typically see as reporting and post-performance, financial working capital net asset management, we've got risk management and governance, statutory audit and tax compliance, and then things like administration meetings and operational issues, so that things are not going to go away. They are part of business and we have to deal with them on daily basis, but now the value creation activities examples are things like driving strategy planning and direction of the business, delivering insights to the business, building relationship with key stakeholders, which takes time, continuous business health monitoring, helping to improve cashflow and profitability, spoke about analyzing data, spend some time on data visualization, we need to look at process improvements and automation, a very important problem solving in decision-making discussions. We need to be in those discussions to help make better decisions, spend time on financial modeling, focus in prediction. So that's the forward looking part, not the backward looking. And then important is the finance team development and coaching, that for me is important. So those are going on, so you can all see all the different daily creation activities, you need to be able to check where you're spending your time so you can close that gap. Adam: (10:59) Just to kind of wrap up our conversation. I wonder if you could talk a little bit about how the finance and accounting team can get closer to the business. You've kind of alluded to it a little bit, but I wonder if you could speak in more detail around that. Arno: (11:11) Thanks Adam. So I took a class of business, so for me it's about to create value you need to become influential in business as a finance team. If you don't have influence you won’t necessarily get people to listen to you and the recipe to become influential, is people need to get to know you, they need to like you, and then that bolstered trust. People are not going to, you're not going to become influential sitting behind a desk. And in order to do that, finance needs to be, so you need to be more visible, not hiding behind a desk, you need to be effective at relationships, you need to be great at communication, you know, being able to get your message across to the audience is vital. And then also the ability to present and story tell the numbers, that's how you create influence. So to do that, you need to eliminate some of the pain points that the finance function has in business. And these are just general pain points. So I spoke about this previously is about, we need to provide more info instead of insights. We need to be involved when problem solving, we need to improve our communication, we need to be more proactive in driving change, we need to understand the business, the business model, how it makes money and how it operates, we need to build relationship with key decision makers, and we all need to be more involved in strategy and future planning decisions. Then finance, the finance team can't work in silos anymore. It needs to be work with the business. So, there needs to be that connection and it needs to be less backward-looking and more forward-looking through scenario planning for cost predictions, all those things. We should, people should understand our language. It shouldn't be a foreign language. Understand what we talk about when we talk about the numbers. And I think we can probably be a bit more fun and engage more with people so they get to know us. The perception is that finance is boring and I don't believe that. I think we all, I think most of us are introverts, but I think we adapt to the situation and nothing, you know, a guy like me, I like engaging with people and it takes confidence, so the more you do it, the better you get at it. And, you get better doing it if you start doing presentations, you know, it's just conquer your fear and do that. So that's kind of like a, what I would say is the focus points to get close to business. And you know, if I can maybe just summarize, my thinking is that finance needs to find the ways to get closer to business. You know, being busy is not necessarily being productive, focus on building your relationship with decision-makers, emphasizes provide more insights than just financial information, improve your skills in communication, presentation, and negotiation. Understand the business first before you just start looking at making improvements, create a team that is customer focus, customers is internal/external customers. And, you know, embrace technology to create efficiencies and drive business performance. So that would be my key points for driving value creation. Adam: (14:30) Do you think that technology is going to help bring together finance and the rest of the business together? Arno: (14:37) Yes, I think it will because, you know, the benefits of technologies enables us to do faucet or sectional processing. It enables us to get information quicker to decision makers and it frees up time for us to focus on other value creation activities. And the one thing I think we can spend more time is building relationships because that takes time. You need to get to know people, so automation is not necessarily a bad thing, it helps us to do a better job and get more insights out to business so they can drive better decisions. And, you know, people can get to know us and we can be more influential because we've actually got, we've got the insights to help drive business performance and I think in the automation enables us to be co-pilots to businesses, to help steer the plane in the right direction because our strategy, our flight plan is our strategy, so where we want to head and finance can help co-pilot that. Adam: (15:33) Yeah, I've heard you say it a few times that the finance and accounting team needs to be storytellers, you know, as with the more data analytics and those things that are coming on that we've been talking about, how can they become better storytellers as they go along? Arno: (15:50) So, so obviously there's best practice when it comes to visualization, but for me it's also about, you know, getting the right message across. Don't get too much detailed cause people get lost in the detail. Go and find out from people what they want to see and then visualize what they want to see, they need to get the story in the first 10 seconds, otherwise you would have lost them. And I think finance can analyze financial and non-financial data. Its no longer just financial data. Non-financial data could be things like your headcount stats. How does that correlate to your revenue? You can look at your customer buying patterns, what are they buying? What are they not buying? It's all those things, and it's not just give an income statement, the P&L balance sheet and cashflow anymore, it's giving more than that. It's the underlying drivers that leads to that number that we can help analyze and I think whatever efforts we give will help with future planning. I think if you've got a strategy, if you need to strategize, and you've got all this intelligence now, it surely will change your mindset and possibly changing the way that you used to budget and draw strategy. Closing: (17:05) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

IMA's website: https://www.imanet.org/International Management Accounting Day: https://www.imanet.org/about-ima/international-management-accounting-dayFULL EPISODE TRANSCRIPTAdam: (00:00) Welcome back everyone and happy International Management Accounting Day. Each year, IMA celebrates International Management Accounting day on May 6th. This global day of recognition commemorates the important role management accountants play within their organizations. Around the world, finance and accounting professionals work to bring insight and help their organizations realize untapped opportunities and operate more efficiently. While this work happens every day of the year, on May 6th management accountants are publicly recognized by IMA. So to celebrate and support the public recognition, Count Me In has a special bonus episode for you featuring IMA's President and CEO, Jeff Thomson. Jeff spoke with Margaret Michaels, IMA's Manager for Brand Content and Storytelling about the future of finance and accounting. Keep listening to hear them discuss the valuable ongoing efforts of management accountants and the race for relevance in a digital age. Margaret: (01:03) Digital transformation enabled by automation, data analytics, artificial intelligence, and other technologies has been the headline story when people talk about the future of finance, but you often bring up the fact that these are really not new technologies. Can you elaborate on that theme and talk a little bit about how the foundational concepts in competing on analytics and other texts laid the groundwork for the transformation we see today? Jeff: (01:41) Sure Margaret. Great question and two related, but somewhat different concepts. So these technologies have been around and developing for some time. Artificial intelligence, has been around for some time, blockchain has been around for some time. But what's different is that all industries have been impacted by these technologies and the applications have been exploding. You know blockchain, for example, the use cases for blockchain were just a few several years ago, but now blockchain use cases have absolutely exploded. You know, blockchain was something we've heard about several years ago, primarily in the financial services industry, but now blockchain applications are permeating many, many industries including education, non-for-profits, and when we think about artificial intelligence, it's not just artificial intelligence in certain industries, it's artificial intelligence in many industries and many applications, so the question is our ability to leverage all of these wonderful uses of these technologies. Now, and then when we think about, RPA robotics process automation, robotics process automation has actually been around for nearly a decade. So when we talk about new technologies, the technologies really aren't that new, but it's the application and comprehensiveness of these technologies across industry verticals that are new. Now, moving to your other question competing on analytics, it's actually the book, Competing on Analytics: The New Science of Winning, by Thomas Davenport and Jean Harris. It's actually a book in 2007 that really laid the groundwork for the transformation to data analytics that as you said, we're seeing today. And when you think about it, imagine it was written in 2007 and when you think about the science of winning in the marketplace, what do you think about? You normally think about cool apps, things that consumers see in front of them. Like I said applications, products and services, things you can touch and feel. You don't think about nerdy things like analytics, but if you fast forward today, analytics is the thing we're talking about. Data scientists, data scientists are the number one sought after job because data analytics is how we get to know our consumers and their needs and their wants. They’re how finance team professionals offer insight and foresight to their CEOs, to their boards of directors. So that is the competency and skillset that we as finance team professionals must really aspire to and really accelerate our competencies.   Margaret: (04:59) Great. Now you often say the race for relevance to describe the current iteration of digital transformation in accounting and finance as technology evolves faster than the skills of the people who need to use it. What are the skills finance and accounting professionals need to focus on to keep up and what competencies really stand out to employers in a time when skills are increasingly commoditized?   Jeff: (05:28) Yeah so another great question Margaret you're on a roll today. Yeah, so there's going to be the infamous hard skills and the softer skills, so we are in an absolute environment of disruption. In fact, we often talk about the VUCA world that we're in, and no it's not a Hungarian goulash, it's VUCA volatility, uncertainty, complexity, ambiguity, VUCA. And we were actually in that environment before COVID-19 tragically struck the world with non-traditional competition, climate, and I can go on and on. So when I think about behavioral characteristics for finance team professionals and CFOs, I think about agility and I know we're going to be talking about agility perhaps in a bit later. I think about adaptability because if you don't have the ability to deal with new situations, stressful situations, totally unexpected situations that your best planning could not have possibly anticipated then you're not going to be able to adjust and deal with the situation from a risk management perspective or a planning perspective. So agility, adaptability, but also being anticipatory. Having that radar at ability to plan the best you can, so from a behavioral perspective, what I call the three A's; agility, adaptability, anticipatory skills. From a harder skills perspective, and again this is for the finance team, strategic planning, strategic thinking and then of course data analytics, data science, everything data, data transformation, digital transformation. Now I don't want to lose sight of the table stakes because as we thinking about the progressive CFO and the CFO of the future, we have to be clear that there are table stakes. There are things that the CFO team must do with excellence that are expected. Things like risk management, internal controls, an ongoing and continuous commitment to ethics, leadership, executive maturity, executive presence, and the like. So we can't lose sight of what got us there and that's a unwavering and relentless focus on, as I said, ethics, internal controls, accurately and fairly representing the financial condition of the enterprise. And then we can offer that insight and foresight and having, enabling the organization to do great things and create great products and services that will change the world.   Margaret: (08:38) That makes a lot of sense and I'm glad you mentioned agility and resilience because COVID has certainly highlighted the need for leaders to help their people become more agile and resilient. How do you define agility and resilience? How equipped are finance and accounting professionals to deal with uncertainty while continuing to innovate and improve processes?   Jeff: (09:04) So agility is, and again, this is a, perhaps a Thomson un-scientific definition, but maybe those are the best. They're not particularly scientific, but agility in my mind, Margaret is the ability to quickly move employees and resources, human resources, and other types of resources, technology resources into new roles or areas of the organization to support changing business needs. And the quickness is really very important because things could change on a dime or a nickel or a penny as the case may be so ability to quickly move employees and other types of resources and the new roles or areas of the organization as conditions change. Resilience or resiliency is perhaps viewed as the physical, social, emotional, and financial wellbeing of employees. Think of it as the shock absorber weathering the storm, hurricane Sandy and the Northeast is a literal interpretation of weathering the storm. COVID-19 around the world and other examples. And when I think about, going back to agility, you know, there's a kind of a company responsibility and a company opportunity to deal with agility, attracting and attaining diverse employees, creating an inclusive culture, identifying employees with digital skills, career pathing, workforce ability offering, and providing technology and communication tools, remote collaboration, but there's also an employee responsibility to improve agility, building your competencies, building skill sets and strategy and data science and data analytics, so it's a dual responsibility when it comes to agility, both an employer and employee responsibility.   Margaret: (11:18) That makes a lot of sense. And as organizations and economies recover from COVID, what do you think the new normal will look like? And what role will management accountants play in helping their organizations recover?   Jeff: (11:34) Well, I think we as a society, Margaret are playing a role in what the new normal will look like. And look, there's no doubt about it, in some sense, tragically COVID-19 impacted lives and livelihoods, closed down small businesses, 3 million deaths, cases, hospitalizations, but the human spirit is strong we learned so much. We learned so much about ourselves, how to cope, learned about how technology can enable, learn so much about how we could deal with tragedy, how we could educate ourselves and lift the human spirit. And we also learned about the new normal of work. So we educated ourselves in so many ways we became a learning society, a world that is transformed forever. So, the new normal in many ways is a new learning world and certainly we've learned that our profession, for example, is one that is a profession that is stronger in many, many ways. It's more, we've invested in new technologies, we've learned that we don't need to be in the office nine to five, we don't all need to be in the office at the same time. We do need to be in the office some of the time, we do need to build and nurture relationships, but you know what, we can close the books remotely, we can create budgets remotely, we can close the books remotely. And so that mix we'll figure out together. We did invest more than we ever have before in data science, we've invested more than ever before in digital transformation across the value chain. Organizations are investing in new hybrid models in terms of remote work, like two-three-two, two days in the office, three days away from the office or in your home office, and then two days of time with the family or other types of models, investing in all types of technologies that enable the consumer to do great things, investing more in ESG to enable the planet to be greener and cleaner. And so, we've learned an awful lot about society ourselves, and our organization. So that is a really, really good thing and I think the new normal will be better than the old normal.   Margaret: (14:28) I agree. I do look forward to a full economic recovery and seeing everybody prosper after such a difficult year.   Jeff: (14:38) I agree, you know, IMA conducts a quarterly global economic survey, as you know, with ACCA, another prominent global accounting association. We've done it for the better part of 60 years. One of the largest quarterly economic surveys of its kind, and there's nothing but optimism in terms of global economic survey. In fact, by the end of this year, we might return to pre-pandemic conditions. You know, if things go well, it's a bit of a race between vaccinations and the variants. We need to be careful and smart in terms of not, you know, going back to relapses and things like that. But if we're smart and cautious, we might see a nice recovery.   Closing: (15:34) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Ramesh: https://www.linkedin.com/in/ramesh-shettigar-9ba1243/FULL EPISODE TRANSCRIPTAdam: (00:00) Hey everyone and welcome to Episode 121 of Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host Adam Larson, and I'm pleased to introduce you to today's featured guest, Ramesh Shettigar. Ramesh is Vice President of Investor Relations and Corporate Treasurer at Glatfelter, a leading global supplier of engineered materials. He joined my co-host Mitch to talk about ESG and its importance across the organization. Keep listening to hear about the finance team's role in ESG, prioritizing ESG over return objectives, and strategies to make ESG truly sustainable. Mitch: (00:47) So in your perspective, how have recent events increased the importance of ESG in business? And obviously for our listeners, we would like to get your perspective, particularly for the finance function. Ramesh: (01:00) Sure Mitch, I'm assuming by recent events you're referring to the pandemic, climate issues, social injustice, and corporate governance matters we've seen play out in 2020. If so I think companies play a very important role in representing to employees and their communities where they stand on these topics. The pandemic for example, has highlighted the importance of ensuring the health and safety of our employees and the communities where we operate. With regard to climate, corporations I think need to be responsible stewards of the environment in the geographies where they operate and need to abide by all local and federal environmental standards so that we can all preserve humanity's long-term health and sustainability for generations to come. We're seeing this play out in broader mega trends. For example, this move from fossil fuels and toward alternative energy sources or the plastics free movement. Working for an engineered materials company like Glatfelter, I feel incredibly proud that we have focused heavily on natural and bio-based feedstocks in our manufacturing process and our product innovation efforts are heavily focused on minimizing synthetic materials in the products we make. As it relates to social topics, employees need to know where their employers stand regarding racial, gender, and socioeconomic disparities in the workplace and if their companies are playing an active role in facilitating an environment that welcomes diversity, equity, and inclusion. Glatfelter for example, has made it very clear through an internal message from our CEO that treating people of all backgrounds fairly and consistent with our core values of mutual respect, integrity, and social responsibility is of utmost importance. We have committed to enhancing compliance training that focuses on diversity and eliminating unconscious biases. Also a meaningful portion of corporate giving will go towards causes that address social inequities and racial injustice. From a governance standpoint, I think ensuring that there is adequate board diversity in terms of experience, gender, and race is very important for investors seeking reassurance that company leadership exemplifies and values diversity. So bringing all this back to the finance question, which I think you're trying to get to, I think the long-term returns of these initiatives and the stand we take regarding ESG will ultimately be positive and rewarding for the company, its employees, and society. So I think that's how we think about what ESG does for us, particularly for the finance function. Mitch: (03:56) That really was beautifully said and thank you for taking us through step-by-step, I think it was a perfect response. Its great to hear those kinds of initiatives put in place and you know, your organization really taking a big step forward in making sure that everybody within the organization is on the same page. I think that clear communication is vital for making sure these ESG initiatives are effective, really is what it comes down to. And you talked about the finance function, the long-term returns. I think it's been a year now with this pandemic that you brought up and obviously there is a little bit of a light at the end of the tunnel. I think some people are starting to see it as businesses seek to return to their normal and that obviously has a different definition than it did a year from today. But how do you prioritize ESG in relation to these return objectives that you mentioned within finance? Ramesh: (04:53) Sure. So you know, the pandemic has clearly appended organizational priorities when it comes to ESG and I think you said it well, right? We've we see the light at the end of the tunnel. We've been through this pandemic now for a year, organizations have flexed and adapted to the marketplace and what the pandemic has brought about. But if anything, the pandemic I think has elevated the social aspect of ESG, which was already gaining momentum, keeping employees safe, facilities operational, and servicing customers are high on the priority list I think for companies and in a way represent the duty of care that businesses broadly commit to as part of their ESG focus. Therefore, I think ESG should not be seen purely from a return objective, because ESG initiatives are simply the right thing to do. Yes, companies of different sizes and complexity operate in different places along the ESG continuum depending on their resource allocation to this important endeavor. And as you know, the ESG evolution is a journey and some are further along than others, but that progress should not be driven solely by ratings outcomes or objectives. It should be guided by a company's core values and commitment to social responsibility. Businesses seek input from various constituents like investors, employees, customers, and suppliers to better understand expectations and what it means to be responsible stewards in the community and that feedback guides their actions and priorities. Mitch: (06:36) What exactly is your method for communicating these ESG objectives with stakeholders and ultimately how do you make sure they understand your efforts and get the buy-in from them? Ramesh: (06:50) Sure. So our primary method of communicating our ESG objectives with stakeholders is through our sustainability report. You know, in late 2019 we formed a cross-functional ESG steering committee within Glatfelter with a primary role of overseeing the sustainability and ESG strategy for the company and providing implementation support to Glatfelter’s businesses and facilities. We worked with a third-party consultant to conduct a materiality assessment to identify our ESG priorities. Particularly since we went through a meaningful strategic transformation as a company over the last couple of years and we wanted to make sure our latest priorities aligned with the new Glatfelter. Our materiality process included peer and industry research, internal stakeholder interviews, ESG team workshops, and application of best practices. We also took into consideration the expectations and recommendations of leading ESG ratings organizations and sustainability standards such as the SASB (Sustainability Accounting Standards Board), the GRI (The Global Reporting Initiative), and UNSDGs (The United Nations Sustainable Development Goals). We evaluated topics based on their potential impact on Glatfelter, the company's ability to impact them, and our stakeholder’s interest in these topics. And we finally settled on seven priorities which are organized along the ESG pillars. Those seven areas are environmental management, innovation and environmentally responsible products, occupational health and safety, product safety and quality, community and employee engagement, corporate governance, and ethics and integrity. So focusing and elaborating our efforts in each of these areas culminated into publishing our first sustainability report in late 2020. We believe this enhanced focus on ESG is an important element of our ongoing strategic business transformation and ability to create additional value for all stakeholders. Mitch: (09:12) It's really impressive. I think first and foremost, proper planning and outlining these initiatives, certainly positioned you for success and then as you said, effectively communicating this to everybody involved, all stakeholders certainly I'm sure helped them truly understand the background and what their role is and what the organization's position is. So once the ball kind of gets rolling here and you have this successful plan rolled out, where can you most quickly see the results and how is the rewards from the buy-in really seen? Ramesh: (09:54) Yeah so Mitch you know, we've all heard the saying, “you can't manage what you don’t measure”. Right? And we recognize that as we evolve in our ESG journey and we over time establish milestones and long-term goals against which we can track our progress. But for that to effectively happen, we need the appropriate systems in place to help gather and consolidate the data centrally through which we can compare actual results to targets and have the appropriate reporting tools. While we have the resources within our operating segments and functional management to focus on the information gathering, tracking, and reporting on each of these initiatives, we need to achieve a level of automation to become efficient and seamless so that progress can be accurately measured and there is accountability. And that level of sophistication comes over time and with scale of the business. We've just gotten started on this long-term journey, but we see ourselves eventually getting there. Mitch: (11:01) So I know you mentioned seven priorities, seven focus areas, and outlining how that all applies to the organization as far as establishing these benchmarks or KPIs, right so you can measure your success. How many would you say, do you have in place for each of those seven areas or is it benchmarks for the overall initiative? Ramesh: (11:26) I would say it's benchmark for the overall initiative. You know we, as I mentioned, we've got these seven key areas or seven key priorities that we've outlined, and then underneath them come, whether it is water quality or energy consumption or waste reduction, product recalls or first-time quality metrics from customers that measure us and measure our performance. I would say the KPIs do exist underneath each of these priorities, but they vary, in terms of scale and in terms of the tracking of how each of these KPIs are performing. So I think some are more quantitative than qualitative, clearly community and employee engagement or corporate governance, these are things that have a qualitative element to it, but when it comes to environmental management for example, carbon emissions or water consumption or energy usage, are very very specific and measurable metrics. Mitch: (12:44) That's excellent and that was definitely part of my question also is the qualitative versus quantitative aspects of it just knowing how qualitative many elements of ESG really is. So that's fantastic and, you know, you outlined such a clear plan, the communication, the benchmarking, I think it's all incredibly valuable for listeners to kind of see how it's in practice. I guess from a bit of a higher level, if you were to offer advice, what kind of strategies or best practices can you recommend for making a focus on ESG truly sustainable for the life of a business. If somebody were to be interested in bringing an ESG project forward within their organization, or maybe it's in place already and they want to drive it further, what are some of those best practices that you've seen along the way with your company? Ramesh: (13:36) Yeah so Mitch, I think for ESG to be truly sustainable it needs to become part of the company's culture and that takes time, right? But it starts with the tone at the top, having a sustainability policy that has been articulated and endorsed by the CEO and reviewed periodically by the board is good practice and evidence that the company is taking ESG seriously. This really serves as the backbone of the company's ESG mandate and investors are looking for this level of commitment from the companies they follow and the companies they invest in. There also needs to be board commitment and oversight of a company's ESG strategy and programming. Beyond that, depending on the size and complexity of an organization, we're starting to see C-suite level engagement and accountability through the establishment of chief sustainability officers that drive ESG across the organization. And like I mentioned before, I think once a company puts the measurement and reporting infrastructure in place, it can be managed more effectively. And by tying compensation to long-term sustainability, which some companies are doing, we will see meaningful progress take place over time. Here again, this will happen as ESG and sustainability become embedded in the fabric of a company's culture and business and investment decisions are made through the lens of sustainability. Closing: (15:13) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Jeff Dailey: https://www.prometric.com/about-us/leadership/jeff-daileyFULL EPISODE TRANSCRIPTMitch: (00:05) Hey everyone, welcome back for episode 120 of Count Me In. I'm your host Mitch Roshong and this is IMA's podcast about all things affecting the accounting and finance world. Our featured speaker for today is Jeffrey Dailey. Jeff is Prometrics Senior Vice President and Chief Financial Officer, and he joined my co-host Adam to talk about data and technology. During their conversation, Jeff addresses the challenges associated with mass amounts of data, how to make decisions based on data and how the CFO's role has changed because of data and technology. Keep listening as we head over to their conversation now.   Adam: (00:47) So Jeff, data is becoming more and more important each day whether it's your latest smartwatch, a smartphone, your internet, things on your refrigerator, or your washing machine. It's getting thrown at us from every direction and even more so in business and for you at Prometric, how are you facing that challenge with all the data that we have in business and how have you adapted as an organization to meet those challenges?   Jeff: (01:12) Thanks Adam. Yeah look, I think the role that I play in Prometric as the CFO is really going to be leading to driving data-driven decision-making. And in order to do that, we really leverage analytic capabilities, not just within the finance function, but across the business. Our business relies heavily on understanding volume and capacity, of our clients and global candidate base for those taking tests in our test centers, as well as new modalities around remote assessment. So we're constantly looking at opportunities to gather and understand data, but also to use that to be quicker and more agile in our decision-making, it really becomes sort of foundational to us driving, data-driven decisions across the organization, it helps enhance forecasting, it helps us understand how we're allocating resources across the operations, as well as our technology investments.   Adam: (02:11) So if you look at your technology roadmap that you're looking into the future, what does that look like for you?   Jeff: (02:18) Well, right now we're in a unique disruption coming out of the COVID-19 pandemic. And I say that it's created opportunity in some ways, given all the disruption to our clients and frankly to all of the candidates that we support. One of the areas from a global technologies we've gone from what was traditionally largely a brick and mortar business model, to enhancing our remote assessment capability, to offer assessments and opportunities for candidates to sit from any location has been key when you're going through national and regional restrictions around social distancing and access to traditionally facilities where we have tested candidates. So operationally or product, we have deep investments that we're making across the technology platform to enhance both functionality, as well as expand in those areas of key features. Within our finance organization, we've actually also taken this as an opportunity to really invest in more, I'll call it cloud native systems and financial reporting technologies that are going to enhance our ability to streamline our close that are helping us in terms of forecasting and helping drive, more data-driven insights across the business from the finance organization, so we've not only had product investment, but also investment in our core ERP platform during this time.   Adam: (03:45) So what were some of the drivers for the decision to enhance your ERP solution?   Jeff: (03:51) Yeah, so I think first off is we have for several years looked into opportunities to consolidate multiple platforms that we had that had evolved both over time in different regions as well as, you know, take advantage of what I think now is really, truly a much more secure, fundamentally sound and feature rich opportunity, in what you're seeing in the cloud native ERP platforms. We see this as an opportunity to not only attack technology as our focus for the investment, but also process improvement and there are a number of areas that are features that we're rolling out that will be further automating the closed process, automating the financial reporting and forecasting process, and also just really trying to drive process improvement in business intelligence deeper into the finance organization.   Adam: (04:48) How has it been trying to do an implementation while having, probably your workforce working from home?   Jeff: (04:55) Great question. I think we have certainly been working remote for the most part, since the onset of COVID-19 about a year ago, but that being said, I think we have a global team and we've always had deep resources in Asia, as well as here in the US. We're using new collaborative tools. Certainly we've done a lot with remote video conference, we've got consultants dialed in they were helping us with that implementation, but I think the key has been having really deep sense around understanding of our current operating model and really having developed sort of the objectives collectively, while we're working remote, but to see where we needed to have opportunity for better access, as well as enhance the security and performance overall of the system that we're investing into.   Adam: (05:53) Circling back to data across the business. Why is it important for the finance function? Cause usually the finance function looks at their data and all the numbers and make sure everything makes sense. Why does it make sense to have the data connect across the organization?   Jeff: (06:07) Sure, great question. I think for us it really starts with understanding our client programs and the candidates that we support on their behalf. Our business is relying on volume and managing capacity through a global network and I think as I mentioned, that includes both the brick and mortar global channels supporting our candidates in center testing, to anywhere else from pop-up events that we run short term and then ultimately, expansion of our remote assessment capability. When you're looking at managing that level of capacity and the different modalities that we serve, it really has become critical from an operational decision-making and performance management capability to have a deep understanding and a deep base around analytics for the business. We are, you know, obviously each day kind of managing into the changing capacity restraints for coming out of COVID. We have had analytics that have provided us more insight into candidate behavior in terms of return to test centers, in our case. We've had certainly a large increase in candidates who are opting to take large-scale global national certifications and licensure exams online through our remote assessment tool, and understanding what's driving those decisions for candidates is critical for us to both enhance the product and the modality for them to have access to our content. When I look from a pure finance perspective, it really has been about harnessing data to help us understand more quickly more accurately what the business is performing during what's been a really disruptive time. We have used this as an opportunity to enhance what we do on a week to week basis in terms of our flash reporting. We have invested heavily in terms of pivoting how we do forecasting for the business. We are deeply connected using data from across operations, IT and our technology and product teams to really help us understand and allocate resources appropriately so that we can manage what, at times or headwinds that vary by region coming out of the restrictions that we've been under through COVID. When I think of, you know again, it's really driving us to be a more data-driven organization around decision-making and I've sort of looked at that as the role of frankly myself and my organization of helping harness that data in a way that helps us make not only good decisions, but also has consistent information accessible for folks across the organization so that everybody's able to easily interpret both the financial as well as the operating metrics that we deliver to the business.  Adam: (8:34) Definitely, so you mentioned that you’ve had to adapt to different business models because of COVID, can we talk a little bit more about that?  Jeff: (09:03) Sure. You know, first as many companies that experienced we had a significant impact on our business from the outset about a year ago. We took steps to maintain and manage service levels for clients that were still able to have their candidates into our test centers to test. But through that, we experienced quite a bit of backlog in our business because we were anticipating a lot of those candidates coming back in once the restrictions eased in each jurisdiction that we operate. When I look at what also happened during that time period, as I think I mentioned, we also took it as really having to ramp up a key product that's now a key piece of our growth driver around remote assessments. The ability for us to provide not only access for candidates during COVID, but also now going forward when we're coming out and seeing more clients embrace remote assessment as a key modality for their candidate base, has been critical in our strategy around investing into a new technology to serve our existing and new clients as we grow forward. We have really tried to migrate from what has traditionally been a brick and mortar channel to ramp up this remote assessment capability. There's a lot of analysis that's gone behind in terms of which clients we anticipate, you know candidate basis to move over into that modality and overall, I think it's just allowed us to really help manage capacity on both fronts because we're also managing our tests, and our administrators, our remote proctors and frankly our overall labor model around candidate support, and customer help desk. When I look at all the data that's coming out of those different organizations, again I kind of come back to tying it all together around how it feeds into what we're forecasting and also how we're using that to make data-driven decisions around what's best in terms of our resources and capital allocation as we look ahead at the next month, the next quarter and upcoming in the next year.   Adam: (11:27) So as you make those data decisions, can we move a little bit into data visualization? How are you telling a story for the rest of the team to show what's happening?   Jeff: (11:40) Well, I think for us it really starts with simplifying the objectives across the organization. As many companies have surely experienced in COVID you've got to make sure that you've got a clear vision and set priorities so that folks remain laser focused during a time that has been so disruptive across the economy in so many different regions, for us in terms of visualizing, we start with how we're performing as a global business, but the visualization and the work that we've done to try to drill that down to a geography as well as a product level view has helped enhance not only the financial review of the business, but also from an operational perspective help really make sure that we've got the right metrics that we're measuring, we understand how we've set markers and leading indicators for each of the business units to monitor and manage, and then to help sort of show progress against those has been a real positive coming out of this frankly because we've had a much more engaged group around our weekly reporting or weekly flash and reviews like that, that are helping us understand what capacity and what scheduling habits are telling us about where we're headed in the next period. You know, I think that level of data and visualizing that for not just again across the finance function, but also across the organization is helping really sync up what operation staff and support are driving. We have a global network of test centers as well as a team of remote proctors that deliver services to our clients. But it's also around candidate support. And when we've had to connect it's been having to understand data supporting candidates coming back in to test post COVID, as those restrictions have been lifted we've had much quicker access to understand where we had to expand capacity and where we had to manage for additional resources to support that backlog. Data has been crucial to helping us clarify, not only the expectation for candidates coming back in, but also helping our clients to define where they have opportunities to expand their own capacity for some of the offerings throughout a calendar year.   Adam: (14:08) So Jeff, as we kind of wrap up this conversation, I've been listening to you talk about your role as CFO and it seems like that the role of the CFO is changing and we've seen papers written about it, we've heard people, other folks talk about it and I just wanted to get your perspective as a CFO, how do you see the role of the CFO changing and as we look forward to the other side of this pandemic, what is that going to look like for you?   Jeff: (14:37) Sure Adam thanks. I think if I look historically the key roles around core finance capabilities have traditionally been around financial reporting, accounting, the controllership function and treasury. I think as you look forward, those are obviously still important in terms of stewardship of the business and overall command of operations. I think where I'm finding myself increasingly involved are more strategic discussions around, anywhere from investments that we're going to make in the company, both in terms of internal product development as well as corporate development and M&A opportunities for the business to grow into new markets and ancillary products. But I think it also really kind of, it takes a turn when you're spending much more time with the commercial organization when you're spending more time with the operations team, to really make sure that as finance has a role, not only in reporting, the outcomes of the work of those groups, really helping be part of the decision-making and helping influence the outcome to a better result. That's been particularly important for us coming out of the COVID-19 pandemic, given not only this disruption to our business and our clients and candidates, but frankly across the team. We've had to find new ways of working remotely together and it's really been a time where we have really invested together as a leadership team with finance having a true seat at the table if you will, to influence the direction of the company. We have been involved in a number of our key client current portfolio, as well as new pursuits, helping align not only the financial plan that we expect to offer to the business to perform too, but also really helping understand the economics and how we can work better to support our clients during what's been a challenging time for their businesses as well. You know, I think adding to that, really trying to be a catalyst for change, when I think about areas that myself and my team have been involved in it's certainly been focused on business performance improvement. I think of that not just simply as cost initiatives and savings opportunities, but really how do we function better as an enterprise? We talked a little bit earlier around our opportunities that came during the pandemic around new product investment, as well as some of our financial systems and other technology investments we're making. Those are meant to really enhance what we can do as a finance organization to contribute to really overall enterprise performance. It helps us when we're getting better around using data analytics to drive pricing discussions with the commercial organization. It helps us when we're making investment allocation discussions or our investment allocation decisions with our technology and product organization and I think certainly looks at that finance has a seat at the table when we're talking about the evolution of our organization. As I mentioned, taking advantage of some of the disruption, but also really looking at where we can be much more of an innovator and really again, kind of coming back to finance having a seat at the table around being a catalyst for that change. I think this has been an opportunity for us to show the value of not just financial reporting, but also overall business performance. When we've gotten much deeper in terms of sharing with the organization how we're doing against not just plans that we set for the organization at the beginning of the year, but on a period to period basis where we're able to show where the investments are taking place, show where those are having the strongest return and make sure that we're allocating our capital and resources according to the best opportunities for us as a company.   Closing: (18:52) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Mark Forsberg: https://www.linkedin.com/in/mark-forsberg/Culligan Water: https://www.culliganwater.com/FULL EPISODE TRANSCRIPTAdam: (00:00) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson here to bring you episode 119 of our series. Today's conversation is between my co-host Mitch and the CFO of Culligan Water, Mark Forsberg. Mark is a senior leader who oversees the finance, human resources, and risk management functions. He is a distinguished Toastmaster and considers himself a lifelong learner and volunteer. In this episode, Mark emphasizes the value of one-on-one leadership and the return on time invested for the manager, the employee, and the rest of the organization. Keep listening as we go to their conversation now.  Mitch: (00:45) So the purpose of today's conversation, what I would like to start things off with is, how is one-on-one leadership and one-on-one management different than traditional leadership conversations that are typically had in the workplace?   Mark: (01:05) Well thank you Mitch, for the opportunity to be on the program today. If we give some context to this, one year ago, when COVID hit the United States, we had millions of people that went from working in their offices to working at home. And this was a real stress test on communications and managers, we all went to our bookshelves and re-read things like it's important to communicate, communicate, communicate. And another word that came up was the word essential. What's essential to happen. And I think what we all discovered with what's essential is the fundamental employee to supervisor one-to-one meeting. And in general, these meetings are weekly, biweekly, monthly check-ins with the employee and their boss and their employee directed talking about projects and priorities. Before the pandemic I would guess that many times these meetings fell off the radar, but after the work from home initiative started, they became really important. And I hope that many of the members in the community are continuing to do those because this is really not so much about why, or I should say it's more about why than it is the how. You can look up a lot of info on the web about these, but I would say that from my experience, I recommend scheduling one hour every two to three weeks, you ask open-ended questions and you get the employee to open up about things and you're there as a guide to them. As accountants, we all justify ROI on technology, on equipment purchases, on process improvement, but the ROI on that time with employees can really pay off at times. So what value do you place on investing time to gain that mutual trust and confidence? The end message really is the employee's work matters and they matter.   Mitch: (03:28) So as far as the work that matters in these conversations, I agree, there certainly was a period of time when everyone was trying to adjust and figure things out for themselves and now we have to touch base again and make sure that we are all moving in the same direction within the organization, particularly within our function. So, once these one-on-one conversations either continue or pick back up, what are the added benefits after the fact?  Mark: (03:55) The manager/employee or the supervisor/employee relationship is a special relationship and I like to give pause and think about if you're a manager, is it possible for you to compile a list of all the people that you've hired and supervised? And it may be hard to do that if you've been a supervisor manager for a couple of decades. But for all of us, leaders included, going back to that first W2 job, could you make a list of all the people that have hired you? And my guess is you get pretty darn close. There's a book, Truth About Leadership, and it gave me an insight and the insight has stuck with me for a long time and the insight was when they interviewed surveyed high school students and they asked who they envisioned as a leader in their lives. Number one was a family member, typically a parent. Behind that it was a teacher or a coach. But when they interviewed or surveyed people in their thirties and forties and asked who's a leader in their life, they said a parent, grandparent, family member, but number two was a boss. And the trust and confidence that can come with that relationship and the power of these open honest two-way conversations is not to be understated. And I think from that you really springboard to a lot of other opportunities. And I would close that question out by saying, get to know your employees as people, they're people first and what they do second. You might think of Jodi as an accountant who's been with you for eight years and she handles the Western region so on and so forth, but Jodi's got a life before coming to work for you and is doing other things on the side. Perhaps she's a mentor in the big sister program. Maybe she played college tennis, whatever it might be, get to know them as people and they will feel that. And then that's where sometimes the magic happens on employees becoming more engaged with the job and the supervisors and managers being more enlightened and you're really developing people versus supervising and managing people. They are developing right in front of your eyes.   Mitch: (06:36) And then how does this one-on-one leadership from the manager/supervisor perspective, ultimately result in what I guess we could assume is better employee growth and retention?  Mark: (06:49) Yeah in my career, the fundamentals of employee retention haven't changed all that much. You know, there are really four (fundamentals), employees like the work, they like who they report to and they trust and respect, they like what the company does and sees that the company has a future, and then they see an interesting future with the company. And I think an important message that I would share and it came out of, as I prepared for this is, you will walk into or stumble into conversations and opportunities for people to develop in their own job. You know in sports, a lot of times people will earn a position due to injury or be granted an opportunity due to injury of a player. And in business, a lot of times it's an unexpected employee turnover or planned transitions. And in those transitions, then there's an opportunity for people to grow on the job and for them to find that more interesting and holds onto a retention. I think also another point I would make is if you're doing one to ones over a period of time, let's say you have someone that reports to you for three years, you're going to have 50 one-on-ones over that time frame. What you'll get then is you'll get the opportunity with a huge sample size to really see how that person performs, their personality traits, how they fit values, are they naturally curious or assuming, do they expect responsibility or do they sometimes dodge it? And I think those are things that factor into your coaching of the employee as well as their advancement.   Mitch: (08:45) And how about the bigger picture? So obviously we have employee retention, employee growth, you know, they have an opportunity to develop this strong relationship, the supervisor is able to kind of mold the employee and really enhance their working relationship and the job that gets done. But beyond that, what other effects does a strong supervisor/employee relationship have on other aspects of the organization?   Mark: (09:11) You have to think about what's going on throughout. And these connections that happen between manager and employee throughout the organization are powerful if they're all happening, for example, if you take a CEO that wants to introduce a new program or new product, and they give an articulate 10 minute video message that gets out to the employees and the GM of the division performs well on a town hall virtual meeting, at some point you have to have a conversation between the manager and the employee about their role in this. And John, the owner of our company is good at describing rationale. And he will say, people really do need to hear it, understand it, and buy into it. And you're not always going to get a hundred percent buy in, but think about this happening across hundreds of conversations in an organization about something that's new or about something that needs to be addressed. So I would just highlight the fact that you're going to get traction throughout the organization when managers and supervisors are doing this all at the same time.   Mitch: (10:32) As far as traction goes, our listeners may be interested in ramping up their one-on-ones, or coaching others how to effectively facilitate a one-on-one with their employees. So, are there some examples or best practices that you can share with everybody to really nurture this effective relationship and ultimately reap the benefits down the road across the organization like you just said?  Mark: (10:59) Yeah, well one is you need to prepare and you really need to show up. The manager needs to think at least for a few minutes Mitch, about what they want to cover and what the employee might want to talk about because we all live in a busy environment and a lot of times we have meetings that go back to back to back, but prepare for it. Make a couple of notes, especially on recognition in that one to one, you want to identify something or have in mind something that you want to recognize the employee for, or appreciate them for and share that and have it be sincere. Mark Twain said it, “I can live two weeks on a really good compliment”. And I really, I think that's true. In terms of the beginning part, the beginning would all be on open-ended questions and you see where that takes you and you need to listen carefully. So I would recommend as a best practice if you're distracted and you don't feel that you can put your attention into the discussion, reschedule it. If the employee is too busy, if they would rather reschedule it fine, but hold them and hold at least one or two per month.   Mitch: (12:25) Now taking a step back when it comes to facilitating these conversations and really having these open lines of communication, I'm sure, there are personal skills that an effective supervisor must possess in order to get the message across and continue this employee growth. So I understand you being a Toastmaster, how has that helped you better communicate, be a better speaker and how do those skills all play a role in this conversation we're having today, as far as one-on-ones?  Mark: (13:00) Well when it comes to soft skills, you need to learn those soft skills somewhere, you need to know the techniques. And I’m mentioning, emphasizing skills. Toastmasters is a great place to learn and practice. And many people think it's all about giving speeches and it's not. It's really many aspects of leadership, speaking, and listening. And what I would invite the community do, your listeners to do, is if you have not been to a Toastmasters meeting, just go to one. And if there is more than one where you live or work, go to both and see which one might be a better fit. And it may not be something that you want to do yourself. Maybe you don't want to join. However, you think of someone on your team that you could recommend to join. And I've talked to people and people will go, well I do speaking, I think I do a pretty good job I don't really need Toastmasters, but there's probably some aspect of communication, listening, and speaking that they can improve on, or they could help others improve on and be a mentor in that club. Now, by chance, I did meet my wife through Toastmasters so I'm probably biased, but there are ways to grow your skills and speaking and I would just encourage everyone to know about the program and if you find a good club, recommend it.   Mitch: (14:36) So I always like to wrap up these conversations kind of summarizing everything that we discussed here and give the speaker an opportunity to share some future thoughts. So we talked about one-on-one leadership, we talked about communication, the soft skills, how do these skills really impact finance and accounting professionals moving forward? What are some of your thoughts as far as, how our listeners can really take this information and hold onto it for future reasons? You know, what might those reasons be and how do you see them playing a role in the profession down the road?   Mark: (15:13) Well, soft skills are critically important. They, how they will play a role down the road is as communication gets more digital, the need for that to be a clear, more articulate, our time in meetings and with employees to be clear, more articulate, I would use the example of in giving speeches, I've evaluated great speakers and I thought, that's a great speech, but wrong topic. It's really about being more effective communicators and I think that is the key for leaders, is to be able to be comfortable in that role, in one-on-ones, in department meetings, in opportunities that come up and a lot of that really comes down Mitch, to preparation and skill training over time.   Closing: (16:17) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Dr. Sean Stein Smith: https://www.linkedin.com/in/dr-sean-stein-smith-dba-cpa-63307444/Institute for Blockchain & Cryptoasset Research: https://www.ibcr.info/Bitcoin Is Hitting All Time Highs – How Are Organizations Accounting For It?: https://www.forbes.com/sites/seansteinsmith/2021/02/17/bitcoin-is-hitting-all-time-highs--how-are-organizations-accounting-for-it/FULL EPISODE TRANSCRIPTMitch: (00:00) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong and this is episode 118 of our series. For today's episode, we welcome back Assistant Professor at Lehman College, Dr. Sean Stein Smith. Sean is also the founder of the Institute for Blockchain and Crypto Asset Research and is a forbes.com contributor in the area of crypto and blockchain. In previous episodes, Sean has joined us to talk about different types of blockchain and its uses. In the conversation you're about to hear now, he talks with Adam specifically about accounting for crypto assets. Let's head over and listen to their conversation now. Adam: (00:51) So Sean in your recent article for Forbes, you talk about how Bitcoin is hitting an all time high. What does this mean for an organization's accounting as not every organization is ready to move into cryptocurrency? Sean: (01:02) Yeah and so with the price of Bitcoin and all of the other altcoins, really at their all time highs or very close to them, all of this is having a huge impact on how companies are trying to adapt, navigate in trying to onboard Bitcoin and other crypto options as a form of doing payment. Right? Because it’s always important to always keep in mind that even though Bitcoin headline prices are obviously headline news, the original idea of Bitcoin and the whole blockchain crypto asset space, it was to develop basically a alternative way to conduct payments. And it hasn't really played out that way and a big part of that is that it's awfully hard for certain firms out there to actually take a Bitcoin and other crypto as a form of payment. And I mean, there are all kinds of IT issues on how the computer systems have to interoperate, but the real issue from sort of our angle here is that the current accounting treatment really makes no business sense from a tax point of view, from a gap point of view, from a IFRS point of view, there really is a issue and a headwind out there that I believe and in all of the anecdotal conversations that I have is honestly proving to be a big headwind that firms are having a hard time trying to figure out how to one, take in these agreements and then two, after they have them what to do with them. Adam: (02:40) So is it kind of like the Wild West out there since there are no crypto specific authoritative accounting standards? Sean: (02:46) Well, there are no crypto specific authoritative standards yet, either under gap or IFRS but there is this consensus that apparently has been reached, led by the top firms trying to sort of get something out there right. And I totally understand why they were trying to get some sort of consensus out there via the white papers conversations, all the rest to have something to answer external client questions with, but the current treatment of Bitcoin and other crypto as a indefinite lived intangible asset, which kind of sounds good on paper, right? Because Bitcoin and other crypto are intangible and they have no fixed economic life. But outside of that, it honestly makes no sense because it doesn't really reflect the economic realities on the ground. And I won't go into too too much depth here, but if I have an indefinite, intangible asset on the books like Goodwill, I have to do tests for possible impairment losses every time, a change in the business outlook really causes that to happen. Okay great, but if I have Bitcoin on the books, as we all know, Bitcoin and other crypto assets have a little bit of price volatility in there. And so if it drops by 20%, 10%, which it has done multiple times, I, as the firm holding these assets now on the books, I have to do the test for impairment, write down the asset books, the cost. Okay, so far so good. But on the other hand, if and when Bitcoin goes up by 10%, 20%, 200%, I can't do anything with that under the current rules. So it's not so much the Wild Wild West out there. It's almost artificially trying to fit a square peg into a round hole Adam, right because I can't mark up correctly the current market value of the assets that I hold, or in other words, under the current accounting, consensus that has been reached in the face of no crypto specific guidance, I'm basically forced to hold these assets on the books at an artificially lower level, no matter what happens outside in the marketplace. Adam: (05:29) Now you mentioned impairment in that last answer, how does that come into play with cryptocurrency? Could you go into a little more detail? Sean: (05:36) Sure. And so probably the most obvious case as to how it could come into play is if I received payment in Bitcoin at the end of 2020 or even early 2021, Bitcoin and the other altcoins out there were on an upswing, right. They had all increased in price quite a bit. During that back half of 2020, and into the first quarter of 2021, obviously there are some pullbacks and that's where the issue really does pop up. So there was one specific weekend early in the first quarter of 2021 where the price of Bitcoin dropped over 20%. And so if I, as a firm head chosen to take Bitcoin as a form of customer payment and then also chosen to hold those Bitcoin in a hot wallet, cold wallet, all the rest of us actually hold them at the firm. So I've been paid in crypto, got the back office and go to work, he was able to interoperate with my AR AP treasury all the rest. So now I'm holding Bitcoin on the books. Okay. Then if it drops by 20%, I think it was 24% over a four or five day period. I have to book that impairment loss. Because that's an obvious change in the asset itself, market conditions, business conditions that then triggers this whole test for impairment. And so if I am correctly trying to apply the current accounting consensus, again not tailored for crypto assets, I would go ahead and I would write down that asset. I would impair the asset on the balance sheet, lowering that asset value, and then also book the cost on the income statement as an expense in the current period. Okay. Fine. But, and then if the price of Bitcoin or other cryptocurrency recovers or goes up, what you did, I can't do anything, I cannot under the current accounting consensus for Bitcoin and other crypto as an indefinite lived intangible asset, I cannot mark up or I cannot revalue that asset. So an impairment loss is a permanent entry. And so even though the market price might have recovered or even exceeded my cost or the old basis that I had in this asset, I cannot accurately reflect that on the balance sheet. Adam: (08:29) So what if an organization wanted to hold cryptocurrency as like a long-term asset, does that kind of change their outlook on it? Sean: (08:36) Well, I would say that really there have been some very interesting headlines out there of firms like Tesla, Microstrategy, Square, have been buying up Bitcoin, and I would assume other cryptocurrencies to some extent, but they have all come out publicly supporting Bitcoin and its use and as a store of value, currency, economic empowerment, all the rest. And I would argue that really those firms and those positions are twofold. One, is to provide them with the liquidity, if they have customers, either individuals or institutions who want to transact in Bitcoin, right. To be able to give them that ability to actually do so. And then two, I would say that really there’s a thought out there that in order to make a return right, because there's the whole cost of capital conversation. And even though interest rates on debt are at all time lows, for the most part, there still is a cost of capital. If we are talking about trying to raise equity and the cost of holding cash on a corporate balance sheet, all of that still has a cost linked to it. And so really, there are two angles here Adam, one is that these institutions could be holding it for the duration, right. It could be holding it for the medium term, longer term to try to enable customers to easily transact with them in Bitcoin and potentially in other cryptocurrencies. Or it could be that they're basically trying to hedge against some of the wider economic forces out there. Right. Be it the quantitative easing here in the US, be it the bond buying programs, be it the economic aid packages being passed through right now, which while absolutely needed are going to ultimately have an impact on inflation, the value of the dollar and the overall cost of capital in terms of equity capital and debt capital at some point. So I would say that while every firm is obviously different, I would say that there is this idea that if you're buying up these large stakes in Bitcoin and possibly other cryptocurrencies, it's more of a, to your question, a play for the longer term. And to kind of sort of wrap up this point here, it's also, I believe, a potential way to try to encourage accounting policy makers be at the FASB, IASB or some other entity out there to try to bring this whole crypto accounting conversation off of the back burner and onto the front burner in terms of, okay fine so we have this new asset class, this new potentially asset category out there, and how do we have these assets and these different financial instruments be shown correctly and accurately on our financial statements? Right. Cause our conversation here today is focused on specific Bitcoin crypto holdings, but there's a whole other industry out there, Defi or open finance basically, and this whole idea of the decentralized crypto exchange, enabling folks to transact, finance, lend, gain access to capital markets in a decentralized manner. So all of that is a sort of long winded way of entering the fact that if there are companies out there that are truly buying crypto or are truly taking crypto as a form of payment, with an eye towards the future, I would say that really, they probably are not as concerned with the impact of this current accounting consensus right now, because on the one hand they are buying it for the longer term and two, I do believe and I am confident that all of this action and activity and debate is going to ultimately force entities and individuals at places like the FASB, IASB and other policymaking agencies to be more proactive in trying to get crypto accounting up to par. Adam: (13:26) Do you think that, or how long do you think it'll take for them to get on board? Sean: (13:31) I mean, that's an excellent question there. I know that, actually I was the co-author of I believe what was the last agenda request item to the FASB back in 2019, specifically on this issue. And I do know that in 2019 and 2020, FASB has come out and basically said, that it's not material enough yet for them to be bothered basically. And I mean basically, and I would say that all that outlook is still probably the prevailing one at different agencies, including the FASB, IASB, all the rest. I would say that the current moves, acquisitions, and corporate allocations of capital to Bitcoin and other crypto are invariably going to have some sort of influence and impact on, how do policy makers approach crypto and hopefully it's going to happen sooner rather than later. Adam: (14:43) It almost seems like we're moving toward like the open market system that you were talking about before, even like FASB or IFRS or anything or US gap will have their standards in place the open market will take on before that even touches it. Sean: (14:59) Well I mean, I think that all of us are currently living in a very interesting time, right? Where an entirely new asset class and an entirely new way of transacting business and an entirely new way of trying to finance entities is emerging right in front of us. And obviously these, policy makers, standard setters have to be careful in how they try to develop standards, right? And so I am acutely aware of the time and the effort that goes into these processes, but to your point, I do think that this is going to be a time where there are going to be certain actors into the private sector or certain States, Wyoming is often talked about as a sort of innovator out there trying to encourage, innovative policy-making, try to encourage innovative firms to come there to incorporate and to operate. So again, I do think it's going to be sort of a push and pull here between the private sector and different sorts of policy makers trying to get out in front of these issues. But I do have confidence in the fact that ultimately we are going to get crypto specific accounting guidance. Closing: (16:31) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact John Lemmex: https://www.linkedin.com/in/johnlemmex/Covestro: https://www.covestro.comFULL EPISODE TRANSCRIPT:Adam: (00:05) And we are back with episode 117 of Count Me In, IMA's podcast about all things affecting the accounting and finance world. Once again, this is your host, Adam Larson, and today's featured guest is John Lemmex. John is Vice President, Chief Financial Officer at Covestro LLC. In that role, he is responsible for all aspects of financial management and controlling. So in this episode, he joined my co-host Mitch Roshong, to talk about digital transformation, John shares many personal experiences and great perspective on how finance leaders can play an integral role in transformation projects. So let's head over to the conversation and listen to what he has to say now. Mitch: (00:51) So John, from what you've seen, how do digital transformation projects typically get started? John: (00:56) Typically in our company, they get started in different parts of the business. It could be, you know, something happening within marketing or R&D or even finance. So it tends to be kind of individual and what our company has done is kind of putting together a digitalization group that's global, and they have kind of the skills and the ability to bring it all together. They are operating a data lake, and they have that kind of expertise, so when people put projects forward, sometimes they'll run as pilot so then you look at and see if they're scalable globally. And then we implement them, look at them and then move on from there. So anybody can kind of bring forward a digitalization project. Mitch: (01:44) Now let's focus mainly on our listeners here and we're talking about accounting and finance. So how important is digitalization for finance? Why should these finance leaders really get started on these projects as soon as possible if they haven't done so already? John: (01:59) Yeah, to me, with the digitalization projects it always comes with efficiency and cost savings and, you know, and there's a business case behind them. So generally, I found most of these cases, we've been able to find a business case, been able to save money, gain efficiencies, reduce complexity, and it helps drive the business forward and make finance more efficient. So it's been, you know, waiting doesn't help drive the business forward so you need to drive these projects to gain those efficiencies. Mitch: (02:34) Let's talk about that a little bit more, how does the finance team, or the finance leader go about building this business case, who is really the target or, the individuals who are most responsible for pushing this project forward? Who should the finance leader really focus on within these projects? John: (02:57) Well, I think that the finance leader for us is kind of internal, I'm kind of thinking of a project that we did. It was something internal in the finance area that was causing us pain. We stepped back, we took a look at it and the answer came using digitalization, using machine learning and robotics was the answer to try to solve the problem. And so then, the business case was put together, and again, it resulted in efficiency through FTE reductions, but it also ended up on a higher accuracy and more accuracy in the financial statements. Or one side, it was cost efficiency, the other side there was accuracy and when that case was put together, we piloted it and moved it forward. Mitch: (03:51) Now you talked about machine learning, obviously there's robotics, a lot that goes into these different projects and for some in finance, that might not be necessarily their first language per se. It might be something that's a little bit outside their comfort zone or they need to upskill in that area in order to drive the project forward. So how do you really engage all these stakeholders and really keep the momentum going for these digital transformation projects? John: (04:15) Yeah, the one thing that we've done to try to get people engaged is actually offer kind of a, you know, online training, in the machine learning in robotics, to get people to start to increase their skill levels so that they may not be become experts in it, or be able to run a project, but they understand what maybe the IT or the data people are going to be asking those kinds of questions and they learn through that, how to drive these projects forward or at least understand what goes into them and there's been quite an uptake rate in our people and trying to do that online learning and develop their skills. Mitch: (05:01) Are there any other obstacles that you've seen, anything else that may prohibit a digital transformation project from progressing how you anticipated? John: (05:11) I think sometimes we get into resource questions, you know, how much resources do we have, and if a project is simply kind of re-engineering a process and using the software, it's much easier maybe to get those projects forward when they maybe require, and I'm thinking of supply chain digital project, those require maybe capital investment using barcode readers, scanners, infrastructure upgrades, and then it becomes more difficult to find those resources and drive them forward. So less capital investment seems easier to drive the projects forward, more capital investment a little more difficult, but again, too is how many projects do you have going? I think sometimes, you get into project overload and there's just, you have to prioritize and get your biggest bang for your buck. Mitch: (06:05) That was actually going to be kind of my next question and obviously there are many areas of the business where you could look for digital improvements, and I'm sure, like you just said many different projects going on all at once. Have you ever come across a case where a project just didn't pan out, you know, the digital transformation just never happened, for one reason or another, can you speak to that a little bit and what the company did in order to respond? John: (06:33) We have one project that in our end to end supply chain, where we feel like we could really upgrade our ability to track materials, move materials and we try to compare ourselves say to an Amazon, we're very far behind. I kind of think of them as the leader when it comes to digitization and supply chain. We had a project we wanted to move it forward, but it stumbled on cap ex and some of it was a business downturn, other parts was then entering the pandemic, but I wouldn't say the projects are dead, but more shelved until the business environment changes. I think if there's a good business case, and then you get into a resource issue, it may not move as quickly as you might want it and get those returns, but you know, you shelve it and continue to push on at a later date. Mitch: (07:32) That's a good point. And, you know, prioritizing, like you said earlier, with so many different things going on and so many functions of the organization being involved in these projects, while it may enhance the efficiency, let's say in finance, obviously you're going to rely on IT and other departments. So, how important is the communication across the organization, with these different projects going on and really, what is that communication path? How do you typically, speak with and listen to other departments while these projects are going on? John: (08:09) Absolutely, the communication is key in all these projects and how to prioritize. And we have a, we call it a digital governance board. So all projects have to go through this digital governance board and be prioritized and that's whether it's a finance project, supply chain, innovation project, they all go through this digital governance board. In fact, our digital governance board is actually chaired by our CEO. That's how important it is to us. I think he acknowledged that he wants to drive digitalization, but the other time we have limited resources, so this board engages in the prioritization of the project. Mitch: (08:55) So it might be the same answer that you just shared, but when it comes to communicating and working, cross-functionally putting these projects out there, how do you ensure that what you're doing really aligns with the core values or the overall business strategy. I'm sure the governance board here that you've mentioned has a lot to do with that, but how do you really make sure that what you're proposing and actually doing aligns with the business strategy? John: (09:22) I think you hit on it that this digital governance board, there's always a question when presenting, how does it fit into the strategy? What is the strategy? And sometimes, if it's cross-functional, it's a little more clear how it fits into the strategy and then other times you can have a simple digitalization, maybe it doesn't have to go through the board because it's such a simple project, that there's just gains from it, but doesn't take so many resources that you can just drive it forward, because it might make sense within the finance area. Mitch: (09:54) Whether you're driving forward or working with all these different departments, you know, governance, what's the typical timeframe? Some people who might not be so familiar with these projects or are interested in starting for the first time, obviously you want to get it done. You're very results oriented in gaining those efficiencies, but what's a realistic timeframe for some of these projects. John: (10:17) Yeah I think sometimes they, when it gets involved into machine learning and into robotics, I think they take a little longer than people might think. Our first foray into that, it took a lot longer than we expected. I mean, we got the gains we expected, and the benefits and the quality we expected. It just took a little longer than I would have liked to get there. So I think you have to learn from that and okay, how do you drive the process faster going forward, and other cases, with respect to digitalization, we've been able to make very quick gains, seeing results within months, not necessarily with machine learning or that a different type of digitalization and with that I kind of refer to, here during the pandemic, or just actually prior to the pandemic, we realized we were printing checks. You know, we still print checks. We put them in an envelope, we put a stamp on it and we mail it. And well, some of the vendors are electronic we said, well why can't we go to a hundred percent electronic? It's really just changing the vendors. And again, you have some leverage with your vendors. So we went from printing 3,000 checks a month, and we're now printing 50 or 60 checks a month. But when we started that project, we started to see very quick returns because we didn't have to involve many departments. It was kind of an internal finance type thing, working with vendors to do that. But, by the time we got into the pandemic, we were no longer worried about printing checks, putting them in envelopes and mailing them to customers. Again, for me, that's kind of a digitalization taking something that was coming out of the computer and into paper and move into complete electronic transfer and we gained a lot of benefits from it. Mitch: (12:13) So that's an example that probably has a much longer return also, but I'm kind of thinking just digital transformation projects in general, what's the typical shelf life? And what I mean by that, is when you complete a project and you recognize these efficiencies, when is it that you then again, have to kind of revisit that project or that area of the business and see if it can be improved even further, how do you really prioritize what needs to be done new and what needs to be done again? John: (12:45) Yeah, that's a hard one. I think technology keeps changing and I’ve seen it through my career. What we thought was leading edge technology five years ago, today is not leading edge technology. I think sometimes report delivery and doing automated online report delivery through reporting factories, those types of things. What's cutting edge in one time quickly becomes no longer cutting edge and you have to go back and say, okay do we change the technology? What's the cost to change the technology, what are the benefits to change the technology? So, I think some things can have a shelf life of up to five years, others might be shorter. I even go up to looking at SAP, you put an SAP system in and all of a sudden, eight, nine, 10 years later, you're looking at redoing it all over again as the technology keeps changing. Those are a little bit longer shelf life I would say, like an ERP system, but still your ERP system eventually becomes outdated and you have to reevaluate and move on with them. Mitch: (14:04) Absolutely. I think it really lends itself to the fact that finance particularly, and really just organizations in general, need to stay agile, right. They need to be nimble and flexible and adapt to everything that's going on. Obviously it's really hard to predict and nobody has this crystal ball, but I like to give our guests an opportunity to kind of share their perspective. If you could look into the future a little bit, what kind of predictions do you have as far as what might be coming down the road for finance and how might digital play even more of a role and whether it's a certain aspect of the day to day or bigger projects that you look to implement, how do you see the function changing even further in the future? John: (14:49) Yeah, I think as, you know, in the future, things like, SAP HANA as those types of things change and what it does to the information that it starts to create within your system. And then how even finance closes the books, you know does things, implements new legal entities, that entire package I think is going to continue to change as the technology changes. Even the fact now that we're no longer sitting on assets and server farms anymore, it's going to the cloud. So how SAP works and how your ERP system works in the cloud, how people interact with it and work with it. I think those things, whether it's Oracle or SAP or others, how that finance function works and how things are integrated with them, I think is going to continue to change and move forward. I think I already touched on a little bit end to end supply chain. I think the Amazons and those types of companies are really good at that end to end supply chain. I think we're going to see it build those same applications in chemical companies. Obviously it's big in retail, but I think you're going to start to see it in business to business, as it goes on. I'm no expert on Bitcoin and blockchain technology, I think we're going to start to see with blockchain technology, how companies transact with each other is going to start to change. And again, we'll see the disappearance of sending checks, receiving checks. Those transactions become much more real time, and I think it starts to change how you run your business. Liquidity planning changes when things become instantaneous, and it just changes the finance people, how they look at it and then how they measure their business. Closing: (16:49) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

FULL EPISODE TRANSCRIPTAdam: (00:00) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson, and today I'm here to introduce you to the guest speaker of episode 116 of our series. My co-host Rouba Zeidan sat down with Dr. Ahmed Yamen, an Associate Professor of Accounting at the American University of the Middle East in Kuwait. During their conversation, they address whether digitalization is the beginning of the end for financial crime. With financial crimes in the rise, Dr. Yamen talks about how it is evolving and what the industry can do to limit the potential risks of becoming the next target. Let's listen to what he has to say now. Rouba: (00:43) Good afternoon Dr. Yamen and thank you so much for joining us for this episode of Count Me In. Ahmed: (00:55) Thank you for your invitation at the beginning, and thank you for IMA. Rouba: (00:59) So, a PwC survey published in March of last year found that fraud and financial crime are on the rise in the Middle East. The surveyed companies reported losses of sum $42 billion in the past 24 months alone       due to financial crimes. Can such crimes impact the economy and if so how? Ahmed: (01:22) The PwC survey actually mentioned a lot of important numbers that can highlight that the Middle East is facing a great challenge toward fighting the financial crime. For example, 42% of the respondents are suffering from procurement fraud. Actually, the problem is that this percentage is double the global percentage. Also, 47% of the respondents reported an incident for customer fraud, and also 45% of the respondents said that there are many uncovered cases of bribery and corruption. The problem is not the percentage itself, which is 45%, but the problem is that this percentage is 15% higher compared to the global percentage. So all of these percentages in the PwC survey indicates that there is a problem. From my perspective, is this the only report that is saying that? No. If we look for example from Basel Index, according to the Basel Index 2020, the risk levels in the Middle East and North Africa are higher than the global average. If we go to other things like the previous studies for example, it reveals that financial crimes have continued to increase despite the tough policy measures put in place in developed and in developing countries. The last estimate is about 1.5 trillion, which is about 2% of the GDP in both developing and developed countries, are paid only for bribes, and this is actually a huge amount. I think that all of this highlights that we are facing a big problem, especially in the Middle East, compared to the overall average. But we can go back to the question: can such crimes impact the economy? Of course, yes. We have different numbers also that can prove that it has negative consequences in the economy. For example, according to the World Bank, in 2017 they said that the poor people in developing countries pay about 6.4 to 12.6% of their income in bribes. And also, the tax evasion, if we look for another continuing of the financial crime like tax evasion for example, we will find that in Europe, for example, it was estimated in 2011 that 860 billion annually is evaded. If this has a negative consequence, it can appear in Greece. You can see what happened in Greece. We will find that there is a big economic problem in Greece and this is apparently because of the tax evasion because the tax evasion is estimated to be equal one third of the total tax revenues. And by the way this one third is equal to its budget deficit. Because as we know, tax evasion is a main source of revenue for the whole government. So, if there is a reduction in the tax revenue it means that the government will not be able to do the public service. Also, if we look for the Panama paper leaks, it's also documented that the tax evasion is likely widespread and significant everywhere. So, from all this, we can say that financial crime can affect negatively the economy and has negative consequences on the economic growth. And if we focus on tax evasion, we can see that it affects the income distribution and allocation of resources. This is a very important thing for the economy. Rouba: (05:34) When we look at regional global economies, positive anti-money laundering (AML) ratings have a significant impact on a nation’s credit ratings and their ability to attract foreign investment. This affirms the fundamental importance of initiatives that are taken on at a national level to create a business-friendly environment where strategies to fight money laundering and terrorist financing are in place. But, when we look at the numbers, particularly in a report published by the firm, Refinitiv, which found that ¾ of organizations have fallen victim to financial crime in the last year – accumulating losses of $1.45 trillion, we have to wonder: are governments actually able to deter financial crime? I mean, yes it does impact them and it is huge, but is it deterrable? Ahmed: (06:26) Of course yes, the governments are able to deter the financial crime, but they should work on this. From my perspective, there are different things that the government should do in order to be able to fight the financial crime. The first important thing is the public governance. In any country, they should care about the public governance inside the country and if we are following the World Bank, we will see that they identified 6 main indicators for public governance. So, I think that any government should work on these 6 indicators. For example, we should improve the rule of law. We should work on the control of corruption. We should work on the irregularity of quality. And also two important things are the voice and accountability in the political stability. And in addition, the government effectiveness, and I will give more attention to government effectiveness here because we can improve it through the digitalization. This is one thing, to improve the public governance. The second thing which I believe is very crucial and very important is education. I will quote something by Sir Kevan Collins, he said that “an educated population is wealthier, healthier and more law-abiding”. This is very important. Investing in education is not good only for children, but it’s also good for economies and societies. So why? Because actually when the people are well educated, they will understand the negative consequences of financial crimes on the individual level and on the aggregate level. From my perspective, the government should work on improving its public governance, and should work on investing in education, and also the third thing is culture. Of course, there is a problem in the perception of financial crime. If we look at what is financial crime we see that they are calling it white collar crime. When I see white, what is white in this? It should be black collar crime. Because actually when you're saying that it's a white collar crime, the people's feeling towards financial crime is not the same as street crimes. Their perspective is not the same especially when the people feel that the government is not dealing with them in a fair way. For example, when someone evades from tax or something like that, the people are happy that they are doing this. They are not understanding that the negative consequences is such financial crime and of course, we need to know that the financial crime can lead to street crime in the future. For example, if we look at Becker's economic theory of crime, we will find that the people resort to crime only if the cost of committing the crime are lower than the penitence gained from it and they found that poverty increases street crime. If, for example, we have financial crimes, they will increase the poverty of the people. If poverty increases, then street crime itself will increase. I believe that we need to create what’s called the shame culture of committing such crimes. The shame culture is very important. In addition to all of this, the government should work on digitalization, because from my perspective if we try to digitalize all the processes, it means that the direct relationship between the people and the fraudsters or the perpetrators will decrease and this can affect positively the situation. Rouba: (11:03) We talk about awareness as well as a key factor and when you think of the private sector and the fact that 73% of organizations across the Middle East are actually very well aware about financial crime, and in Saudi it's actually 85%, but the adoption to the tools needed to protect companies is relatively slow, so while awareness is there, adoption and adaptation are a bit lagging, why do you think that is and what do you think is causing this delay? Ahmed: (11:37) I mentioned before that we need 3 things, the public governance and the education and the culture. Rouba: (11:46) Digitalization aka digitization – though they are relatively different from each other but frequently referred to in the same context – are transforming the fight against financial crime. The migration away from traditional paper-based processes has optimized both speed and efficiency for the finance and accounting profession. Even though digital transformation is paving the way for increased protection against corruption, exploitation and data breaches, such advantages are also presenting equal opportunities for criminals, I mean we are not the only ones benefitting from this. Can we really say that digitalization and the process of it can actually help to mitigate or prevent financial crime and if so, what needs to happen, beyond the elements that you mentioned; education, awareness and those three factors, what needs to happen in order for this to take place and be fully implemented? Ahmed: (12:42) First, I believe that digitalization is more important than digitization. Because digitalization means that we are transforming the whole business process into a digital thing. But digitization means that we are just converting the data into a digital format. So, I believe that we need to talk about digitalization as a whole, this is the first thing. The second thing, I did a study on the impact of the adoption of digitalization on tax evasion. I tried to test whether the digitalization would affect negatively the tax evasion, would deter the financial crime or reduce the financial crime, or it has no effect, it’s not significant, it’s insignificant, it will not affect any of these kinds of crimes. I did this test for 139 countries by the way and the findings was that there is negative relationship between digitalization and tax evasion, which means that the digitalization will help in reducing the financial crime and actually this result was the same results whether it was a government digitalization or business digitalization or even people digitalization. Whatever is the type of digitalization that we worked on, this of course will help in reducing the financial crime and to deter the financial crime. And as we know that depending on electronic cash for example or on the blockchain technology, I think will help in reducing such kind of crimes. For example, the blockchain technology, we can see that it has main characteristics that help to reduce the crime by the lack of centralization, the lack of information on users, the transaction cannot be undone, and this is of course very important, and also the autonomy. So all these characteristics of the blockchain technology I think will help to reduce financial crime in the future. Again, it is not a guarantee, we cannot guarantee that it will reduce, till this point, because we are looking at one side which is the victims, we need to protect the victims, but there is another side to the equation which is the fraudsters and the perpetrators. Are they trying to improve themselves or not? Rouba: (15:28) Yes of course they will. Some figures really are jaw-dropping for me. According to global records, only 1% of criminal proceeds generated in the EU alone, are actually confiscated by authorities. This pretty much states the magnitude of the problem, 1%? Is digitalization a promise of more efficient outcomes ahead? Ahmed: (15:55) 1% is very low of course, and I think that if we are following the financial action task force, which sets the standards for anti-money laundering arrangements, it found that the regulatory regime is highly inefficient. I believe that digitalization will help to increase the regime efficiency. But we have another thing which is related to the allocation of resources, we are still wanting to focus the resources on the important thing which is digitalization. Also, it is very important to have skilled people in our system, who are able to highlight any problems. It is not only about having a system, we need to have qualified personnel. From my perspective, again, the adoption of digitalization will help in reducing the financial crime, but at the end, we need to look for the fraudsters and perpetrators, because also as you know, when we close one opportunity, they can create another opportunity. Rouba: (17:07) The Covid-19 pandemic and that sudden transition to remote operations exposed companies the world over to increased chances of cyberattacks. If we look at figures from June of last year and just for a period of three to four months, just into the pandemic, more than 2.57 million phishing attacks were detected, and that’s just in the Middle East. What can be done to curve that fraud triangle and prevent it from increasing during times of crisis? Ahmed: (17:51) If we are talking about the Covid-19 pandemic, we need to see whether the financial crime affects the pandemic or not at the beginning. I tested this also and I found that the tax evasion and corruption increased the risk of Covid-19. Because when the tax evasion increases, and corruption increases it means that the government are facing deficits. Of course, this deficit or budget deficit is affecting negatively the public health, because there isn't enough beds, there isn't enough resources for the people who are suffering, so it means that it increased the risk of the Covid-19 pandemic. This is the first thing. The second thing or the main question is, what can be done for the fraud triangle? Prevention during times of crises, let's talk about the fraud triangle itself. The fraud triangle has three edges, the first is pressure, the second is opportunity and the third is rationalization. And from my perspective most of the people who are committing these crimes want to rationalize to themselves that they need to do this crime. This rationalization can be for example when an employee wants to embezzle something from the company, so he is telling himself I want to do this action because they are not giving me what I deserve, I am doing a lot of work and not getting proper income, and so on, so he tries to rationalize the behavior. But, if we look deeply, inside the psychological aspect related to this fraudster, we will find that he might be affected by the person associated to him, or it can be because of his low self-control. This is for the rationalization part. The second part is the pressure. Of course, anyone wants to do a crime if he’s facing financial pressure. I believe that with poverty and with the inefficiency of the government, this might increase the pressure on people. Especially during the Covid pandemic, unemployment is for example increasing because of Covid. If unemployment increases it means that people are more under pressure, and this of course will increase the opportunity for more crimes. The third thing is opportunity. I believe that digitalization can reduce the opportunity for committing the crime, because opportunity means that there is a problem in the internal control system. If we use digitalization it can solve part of this problem. But again, this opportunity can also be increased if the fraudsters improves themselves also, because we need to talk also about the fraudsters. When we improve ourselves as victims, the fraudsters at the same time will also try to improve themselves. Rouba: (21:23) They are at the same pace, even faster. Ahmed: (21:26) Yes, yes, this is the issue. Again, I believe that we need to care about themselves and we need to think from the fraudster's perspective. Rouba: (21:39) Yes, that's a key factor, I think that's ultimately the biggest fear, that as much as we advance, they too are advancing. And look at all these latest developments in the FinTech industry. They are brilliant, unprecedented at any point in human history. They simplified so many financial transaction processes, the accounting profession is excelling because of it. It's really transforming the profession if anything. If we were to give a piece of advice to our audience who's mostly finance and accounting professionals, what can private sector companies do to ensure that they do not become the targets for financial crimes and even if they are targeted, that it is done in a way that they do not fall victims to it? And tag to that question, is investment in digital capabilities sufficient and how much reskilling and upskilling of resources, equally to those criminals are doing, are needed in the fight against financial crime in this highly evolving digital era? Ahmed: (22:48) First, investment in high technology is very important, it’s very important, especially in reducing for example one type like customer fraud. We notice that when you use high technology, the customer fraud is decreasing. But, at the same time, which is also very important, we should care about the internal control systems. We should give more attention to the internal control systems, to the corporate governance, in addition to having highly skilled people. We cannot depend on graduated people like before, since he’s graduated so it is okay, we can appoint him and that's it. No. This is not the case now. From my perspective, universities from all over the world should work on this. For example, in business schools, still till now, we are not introducing the machine learning. And of course, when we have graduated personnel, they are not well qualified now. My advice to the organizations is that they should appoint highly-skilled people who are able to collect suitable data, analyze it and define the anomalies and the variances. This is the most important thing. I believe that companies should be careful when hiring new employees, the capabilities of those employees should be high. Rouba: (24:42) But that also includes investing in existing employees and making sure that they too are accelerating along with that. Ahmed: (24:49) Yes, this is also very important, the training. I was surprised that the last years, and I understand this, there is a huge reduction in training costs everywhere. Even the training programs, if we are trying to find the training programs all over the world, we will find that there is a cut in the training programs. Rouba: (25:12) Yes, absolutely. That's the first thing that went, although it is actually more needed now than ever. Ahmed: (25:18) There is a cut in the training costs of course, but from my perspective to fault this problem we can depend on some websites that give online courses for example, so we can force the employees to take these courses, and these courses are free. So, we can cut the costs but at the same time we can make sure that our employees are improving themselves. Of course, I don't want to say examples of this, but we have many websites that can help. For example, if we are talking for the IMA, we have a lot of webinars. I think that these webinars can add value to IMA members and to everyone. And I believe that IMA is working on introducing some courses, and also these courses can help to improve the skills of people. I believe that yes we can cut the training costs, but we can find another way to improve the skills. Rouba: (26:31) Yes, when you refer to IMA there is an abundance of tools, that are accessible to IMA members maybe more specifically, but there are a lot assets that can be used, a lot of research. Beyond the periodic updates to the CMA program, you have a lot of assets that can be attained through the IMA portal and the website. There is so much information there, so much knowledge. Ahmed: (27:02) Of course, myself, if I am talking about myself, I attended many courses which added value to me and introduced me to new topics and kept me updated for a lot of things. Rouba: (27:14) Yes you are right, there are multiple ways, but I think that the life-learning approach of continuing to evolve, whether through webinars or... Ahmed: (27:25) There is a change, a huge change in education, even for our children, we can see that they are not going to school since one year ago. They are now learning online. To go back to our main topic, of course it is very important to invest in high tech, and it is very important to invest in our employees, in their skills, and it is also very important to appoint highly skilled people in the future. Closing: (28:03) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact David Wray: https://www.linkedin.com/in/david-w-29627882/David's Website: https://davidwray.com (*access David's book and/or blog here)Want to join David's LinkedIn Group?! https://www.linkedin.com/company/37817090/FULL EPISODE TRANSCRIPTMitch: (00:00) Welcome back to Count Me In, IMA’s podcast about all things affecting the accounting and finance world. This is your host Mitch Roshong and I'm here to welcome you to episode 115 of our series. Today you will once again hear from finance executive and a fortune 50 multinational and now new author David Wray. David is the author of the recently published, The Power of Potential: A Straightforward Method for Mastering Skills for Personal to Professional. In 2019, the Harvard business review investigated where learning and development goes wrong. In his book and during this podcast episode, David calls for a new mindset and approach towards acquiring new skills and achieving the level of mastery desired. Keep listening to hear about his learning approach and perspective on personal development. Adam: (00:54) The Harvard business review in October of 2019 investigated where learning and development goes wrong. They found that organizations spend about 360 billion US dollars on training and ask the provocative question whether or not it was worth it. So David, if we start with this Harvard business review article, can you share your thoughts on whether organizational spend on learning and development offers a good return on investment? David: (01:27) Yeah I can Adam, it's a great question to set the context for our discussion. So the typical organization spend on development is definitely not worth it. If we start thinking about the reoccurring themes that seem to come up, you know, survey after survey. So as you mentioned, the Harvard business review, they found that about three quarters of managers across about 50 companies give or take were quite dissatisfied with their company's learning and development function. Gardener on the other hand, found that about 7 out of 10 employees don't feel that they have the skill necessary to master their roles and the findings go on and on. So I started to undertake my own research and thought, well let me find out what's happening and most of the individuals I spoke to experienced real frustration and disappointment with what it took to learn new skills for them. So hence they tended to give up. I heard a lot of funny things and some of them were interesting things I heard with things like, “I feel like I'm faking it, hoping it just comes to me one day, perhaps I'll have an epiphany” or “I'm pressured to work harder pitches doesn't help, I can't seem to master the critical thinking skills I need”, or “I've been asked to speak at an upcoming medical conference and I'm truly petrified and end up sounding like a toddler”. And when I started hearing and seeing firsthand these stories of people really giving up while trying to acquire a new skill, I began to wonder why, why do some people struggle when others seem to manage it almost effortlessly? Why is this happening? And it was really this curiosity that motivated me to start researching, identifying, and then eventually understand the differences that make a difference between those individuals that see it through and those that give up. And from the research that I did, the model I share in the book really comes to life. It's basically a methodology that's used unconsciously by masters in their field, and it offers real value for time and effort invested to learn a new skill. And it's a really a new way of approaching learning, especially for accountants where so much of the learning happens on the job. Adam: (03:29) Okay, now you've really piqued my curiosity. We at this podcast with Count Me In, we're really trying to help accountants, whether it's through learning or seeing what's happening in the industry. Can you tell me a little bit more about your approach and about how your approach is different from everything that's already out there? David: (03:47) Yeah of course, I'm happy to give some insights into the model. If you really start to think about situations where you've undoubtedly seen a really talented individual in action and you've been sitting there secretly wishing, “gosh I wish I could do that and do it as easily and effortlessly as they do it”. Well, you can. Now you might be wondering how. Well to do so, we all simply need to just understand both the visible and the invisible workings that an expert utilizes when they're doing their thing. And basically the power of potential teaches readers about these real, but invisible internal processing mechanisms that we all go through when we receive information. And basically think of the receipt as information as something like an external event or an externality. And these externalities, they occur every single day and they can range from very benign things, something as simple as being, for example, cutoff in traffic, but they can also range to the other extreme, which is life-changing. And an example of that might be for example, hearing a terminal medical diagnosis. So clearly a life-changing and difficult thing to hear and individuals react very differently to the same information or the same events. So why is that? That's what I started to really wonder. And what I determined on, what I discovered is that the differences in how we process information, because when we process information we do so using our own view of the world. We relay each filter information as we process it. So for example, some individuals may choose to ignore information or they may generalize by associating it to some past experience. Let me give you an example of that. Imagine that you're an individual who's giving constructive feedback to a peer or to another team member. While there are one or two ways that constructive feedback can be received. It can either be seen as an opportunity by the individual receiving it, or it could be seen as a threat. Now how that's received will depend very much on the person's prior experiences and that's what I mean by the view of the world. So each of these information filters that we have is basically influenced by how we see ourselves. So things like what we believe, what we value, any kind of powerful memories, whether they're positive or negative, and also how we speak to ourselves. So for example, is our inner chatter self-critical, or is it self-respecting? And as if all of this rapid processing wasn't enough, our current state of mind also affects outcome. Let me give you another example of that, to help bring it to life. If we're cut off in traffic on a day where we've just heard some great news, the other drivers lack of consideration, will probably roll away like water off of a duck's back. But if we've just received news of a layoff that relatively minor traffic slight could become a trigger to an uncharacteristically angry outburst. And it's that, that I mean when I talk about state of mind. So these rapid information processing systems basically result in the behaviors we exhibit and in turn, how others perceive us. And it's by understanding these inner workings that basically the reader is empowered with the knowledge and tools needed to harness them to their own advantage. Which means that the learning solution that I provide is really personalized. Let me give you another, a simple example. Imagine that you dream of moving into a finance leadership role, but you're really held back by your inability to present effectively. You feel physically unwell at the idea of being behind a podium and speaking to a group of people. You've already attended a public speaking course, which focused on observable things, things like posture, attire, media aids, technology, eye contact, voice, and things like that. But it's not turned you into a good, nevermind, an expert public speaker. Well, what if I then went on to tell you that you absolutely can develop lasting mastery in public speaking simply by understanding which beliefs, values self-image and life mission and vision are critical to that success. And what if I went one step further and showed you how to incorporate what you learn with your natural preferences and tendencies so that it feels smooth and effortless to you. And basically the power of potential does all of these things and more, which is why it dramatically increases development and retention of new skills. And that's what's different about the book. Adam: (08:14) That's great. There was an aspect of the inner workings of your book that as we were discussing this conversation, I was wondering if you could talk, about the concept of unconscious competence and conscious competence. Can you share more of what this means and how listeners can use this insight to accelerate their career? David: (08:33) Yeah, sure. It might help if I explain the terms for our listeners first. So before we go too far, let's think about how people typically learn. Most of us, or mostly we learn in a very systematic way. So we basically start from a place of not knowing sometimes even from a place of being unaware that we don't know and often we've probably each heard the expression, “you don't know what you don't know”. That's basically the starting point. Learning starts to happen when we start to evolve from this into a space of knowing full well that we don't know. It's basically now the state of being aware of our conscious incompetence. That basically means that we now are aware that we don't know something. So that's actually progress, believe it or not. The third step in the process, and when comfort really starts to develop in applying this new skill, we reach a higher level of self-awareness and this is referred to as the conscious competence phase. And as I mentioned, it's basically the third step in our journey towards mastery. Now we're aware, we basically know that we know something which is great, you can start to see the evolution. Once the target skill is mastered, we of course naturally put a whole lot less conscious thought into doing it. Now we've reached the final learning phase mastery with ease. This space is referred to as unconscious competence, and this is where the true experts excellence will lie. It's also the space where we don't realize that we're masters in doing something, we just don't think about it anymore. And you might think of a simple example around that and I was talking to a friend earlier today and I, when I was talking to her, I said, you know it's one of those cases where if you think about your mom or you think about your dad, if your dad does the cooking and you think about the fact that they can literally walk into the kitchen, open the cupboard, the fridge, pull out a bunch of ingredients and end up creating something quite incredible without following a recipe and often do so without even having tried it before. That's where this level of unconscious competence comes in. They don't even realize how good they are. That's the space where real mastery lies. Let me give you another example to show in an action, this is a true story. A number of years ago, an executive said to me, he said, listen, David, we've got some incredibly smart employees that learn much more quickly than most other individuals. So I know full well, they can acquire your finance knowledge within a year or so. And you know what I want you to make that happen. That's literally what he told me. Now, keep in mind that I had nearly 20 years of experience by this point. And personally I knew full well that, that was a completely unrealistic expectation to believe that any one can master two decades of somebody else's experience, whether it's in critical thinking skills, making sound judgments, or estimates or explaining complex issues within a year. So that said, I can teach people how I use a variety of inputs, how I weigh up what's relevant and what's not. And how I ask the right questions and how I get information that perhaps other individuals aren't able to get from functional teams that may not be willing to share that information. So how did I do it? Well, I taught aspects of applying the skill that you can't see. What I was teaching people was what I think about. How I create the patterns, why I make connections, how and why I ask the questions that I do, the words that I use in asking the question became very important. The tone of voice I adopt, how I got into a curious mindset. And really what drives me and the quest to solve a given problem at hand and why any of these things even matter. And that's just a glimpse. It's really all of this hidden magic that makes it seem all so easy. So bringing this hidden skill into the light is really where learning happens. And there is a trick or two of course to doing it well, which is what the power of potential shows readers how to do. So imagine what's possible using the right techniques after extracting the secrets to presenting financial information to non-financial users for example. Or the secrets to modeling the financial plans for a new factory. Think of the opportunities to influence that this provides to you. So basically I share several techniques and a very practical and relatable way to help readers gain a rich understanding of the behaviors, the skills, the capabilities, the beliefs, and values necessary to truly excel at whatever it is that they want to do, whatever their desired skill is. And it's basically by tapping into this space within highly skilled individuals that management accountants and many others can learn in a fundamentally better way and by extension accelerate their careers. Adam: (13:25) So if we jump ahead a little, what advice would you have for a listener who is trying to self-assess their skill level? David: (13:31) Another great question Adam. There are really a number of ways to assess achievements, progress or outcomes. And it basically starts from the inside out and it moves swiftly outside. But there's nothing more damaging than someone who thinks they're amazing at something when consensus shows the opposite. And this happens very quickly to individuals who are in a position of authority or power or either no feedback is solicited from anyone or the feedback received is simply dismissed. We need to be aware of the self-defeating traps because feedback is critical. We are only ever as good as we are perceived to be. So back to the question of self-assessment, there are many questions that you could ask yourself. One approach I found that works well is being customer driven. That is, put yourself in the shoes of your customers. So for example, if you're a pianist, is your audience moved by the music and transported away as you play, or as a finance leader, do senior management ask you for your opinion because you inspire their trust and confidence. How would you objectively assess a given skill? Because after all, there's no point in kidding yourself if the objective is skill mastery. So the inside out assessment approach really starts with a self-assessment and moves outward to put yourself in the shoes of a dissatisfied customer to ultimately directly asking customers or your extended network for feedback. There are many ways to basically get there. Adam: (15:03) So David this has been a very insightful discussion, but before we wrap it up, I like to ask one last question. What parting advice do you have for our listeners as they consider learning and development in 2021? I'm thinking even beyond, the required credits you need for your certification, you're looking at your full learning and development. David: (15:24) Brilliant question, Adam and I absolutely love finishing on a forward looking question. There really is no better time to start a new chapter, no pun intended of course, than today. I might be a little biased as the author, but I openly admit that I wrote The Power of Potential to help as many aspiring professionals as possible. Soft skills are more sought after than ever in accounting advisors. So developing them is a 21st century necessity for every single finance and accounting professional. The book takes readers through a journey of self-discovery from a big idea through self-improvement and mastery of any desired skill. Each chapter provides secrets that allow readers to get a jumpstart on their careers and take control of their future. I might go so far as to say it's highly likely that our listeners will find themselves enjoying a life free of what if regrets and living the life they want. And I basically love seeing people succeed in their careers and personal lives. And it's in that spirit that I write a weekly blog on leadership and soft skill development. So if our listeners want to accelerate development of the soft skills, I really encourage them to sign up at the website and receive it right in their inbox every Monday morning or join the LinkedIn group if that's easier. After all, the world is our oyster, only we can seize the opportunity and reach our full potentials in 2021 and beyond. Thanks a lot for having me Adam, I really enjoyed sharing this story with you. Closing: (16:49) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Raef Lawson: https://www.linkedin.com/in/raef-lawson-2a27914/Download the Full Report, "The Impact of COVID-19 on the Finance Function": https://www.imanet.org/insights-and-trends/the-future-of-management-accounting/the-impact-of-covid19-on-the-finance-function?ssopc=1&utm_source=MagnetMail&utm_medium=Email&utm_term=EMAIL&utm_content=03%2D09%2D21%20Value%20Creation&utm_campaign=How%20is%20COVID%2D19%20affecting%20the%20finance%20function%3FFULL EPISODE TRANSCRIPT:Mitch: (00:00) Welcome back to Count Me In. IMA's podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong and this is episode 114 of our series. In this episode, IMA's Vice President of Research and Policy, Raef Lawson, joins our co-host Rouba Zeidan to talk about IMA’s recently released report, The Impact of COVID-19 on the Finance Function. Raef led the research and discusses his findings in regards to how this pandemic has disrupted the profession and what the perception is towards upscaling and rescaling. So, to hear more about the survey conducted and the key points from this report, we will listen in to their conversation now. Rouba: (00:44) So good morning Raef, and thank you so much for joining me. Raef: (00:55) Well, it's a pleasure to be here to talk about our study we recently completed. Rouba: (01:00) Absolutely and it's quite insightful so I'm happy to be sharing this with our listeners. So let's start from the beginning, IMA published a recent report. You were the lead researcher on this body of work, which evaluated the impact of COVID-19 on the finance function. So can you tell us a little bit about the scale of this research that you conducted, basically the countries, the sample size, demographics, and then the purpose behind it? Raef: (01:31) Sure. So it was quite a study from our perspective, it surveyed almost 1,500 people in countries from around the world and those included China, India, Saudi Arabia, the UAE and the United States, and the survey study participants were about evenly divided among those five countries by design. Slightly more than a third of the respondents were women although that percentage varied by country, ranging from say 51% in China, to 18% in Saudi Arabia. And, you know, I think though that those percentages fairly well mirror the participation of women in the workforce in those countries in the accounting and finance field. So, the purpose of the study was to really understand the impact, not just on organizations as a whole, and you know, in the news we can hear plenty about that, but you know, in keeping with IMA's mission to help advance the accounting and finance function within organizations to look a little more specifically at the finance and accounting function within organization and see what the impact of COVID-19 pandemic had been on those. Rouba: (03:05) Amazing. And, so this is technically a global piece of research, as what are some of the most notable highlights that this report uncovered? Raef: (03:15) Sure. Yeah and that was true, we selected the countries in the study to really get this global overview of the impact of COVID-19 on organizations, and our study yielded quite a huge thing of results. One not surprisingly was that there was, an across the board decline in revenues among organizations of all sizes. With very large companies, and by that I mean those with revenues over $10 billion, most likely to report having experienced a considerable decline in revenue, you know, of course, subsequent to that, we hear how larger organizations bounce back also more rapidly from the effects of the pandemic and how smaller companies are now, suffering. The pandemic has impacted employment as we've heard as well. And surprisingly about half of the companies have led some of their staff go. Rouba: (04:31) That's substantial. 50%. Raef: (04:33) It is, it is, you would think it would be much less, but that is, you know, a tremendous percentage and a lot of, obviously suffering on the employee's part. It did vary by region. So companies in the US were the least likely to have let go of staff, followed by China and India, while those in the Middle East, which again include Saudi Arabia and the UAE were most likely to have let some of their staff go. And the impact on accounting financial professionals wasn't confined to be let go or not. There was also a considerable impact on the compensation of finance and accounting professionals. And most of the respondents to our survey, reported that they had a reduction in their compensation this year, this past year, whether it was salary, bonus, or both. And again, that varied by region with companies in the US least likely to have changed the compensation of their employees, companies in China were most likely to have left salaries unchanged, but to have reduced bonuses and that reflects the larger amount of incentive compensation that Chinese companies typically pay. And finally, companies in India and the Middle East were most likely to have actually cut salaries of their employees. And then finally, another key finding was that there was a change in the findings of the priorities of finance functions, which is understandable. There was an increase in the emphasis on risk management with nearly half the company spending more time in that area, followed by cashflow forecasting new management, you know, most when the pandemic hit, a lot of companies went into crisis mode just trying to survive and these two, competencies areas became, critical for their survival. And, you know, fortunately less time was spent on business partnering and decision-making, with about a third of the company spending less time in that area, though I will say we've completed another study recently that has found that the pandemic has changed most CFO's views of their role within the organization. And most CFO’s now are becoming a business partner with their organization. Their insights are considered being key to decision making at the senior level within their organization. And I think we'll see a much greater emphasis on the CFO as a strategic business partner going forward. Rouba: (07:48) So it does bear some good news to the profession, despite all of these, negative results. But there's also one notable point that I looked at, which was basically the tourism industry was one of the most severely impacted industries. But what other sectors also fair in terms of that kind of impact? And what do the findings tell us about them? Raef: (08:11) You're right. The tourism travel and hospitality industries were the hardest hit industries. There, 13% of the respondents were furloughed or let go. 58% had their pay cut and, you know, that's clearly a result of companies quarantining, locking down and so forth. But also relatively hard hit were professionals in the government, nonprofit and education areas where another 5% of those folks were furloughed and, 52% had a decrease in their salary. So that was a significant impact for those industries. On a positive note, relatively least effected were those working for companies in the accounting and finance industries. Sorry, so good times or bad, we need our accountants. Rouba: (09:12) Absolutely, you know, I liked that there's been quite a bit of that conversation of, you know, CFO’s and finance professionals stepping up to become part of the decision-making process. And I think it's these times like a pandemic that kind of puts that in perspective because you get to see how important it is to have that kind of guidance and support and direction. Raef: (09:33) Absolutely and as you know, as I mentioned before, managing cash flow, just being able to survive it was the number one priority of many companies, especially early in the pandemic. And the CFO team was critical in that decision-making process, but next least effected were companies in related industries like financial services, banking, and real estate and I know, especially here in the United States, the real estate sector is booming. A lot of people that are working from home are looking to change their living arrangements and perhaps either get a little more space or different type of space, so some sectors of our economy, as we know, are doing quite well. Rouba: (10:27) What this report provides is kind of a global view of the impact of COVID and when you look at the spread of the impact, which regions would you say were hit the most and how badly has the impact been on say finance and accounting professionals and their respective revenue of you know, of their organization? Raef: (10:49) Right. So, the Middle East and India, were the hardest hit. It's clear that in the Middle East, especially, with this, with the decline in business activity, there was less demand for oil and that results in a steep drop in oil prices, which had a tremendous impact on the economy in that region. So they had to deal with not only the generic impact of the pandemic, but also the decline in their number one industry. On the other hand, China seemed to be the least impact. I think this was clearly a result of their ability to reduce the transmission of the COVID-19 virus by being able to lock down the country, and reduce transmission and enable it to restart it’s factories and the economy in general relatively quickly. Rouba: (11:57) IMA is considered a lifelong learning institution, which strongly believes in up-skilling and re-skilling as a means of remaining ahead of the curve. What does the research say about the impact of COVID-19 on finance and accounting professionals and their interest in up-skilling and re-skilling, has it made the process more fundamental, do you think? Raef: (12:19) Yes, absolutely. And I'm glad you're asking this question because a key mission of IMA is to make sure that accounting and finance professionals assess the skills that they need to successfully compete in the job market and have fulfilling careers. So, the answer to your question is a resounding yes. There was, a significant concern among the survey respondents as to whether their curve professional skills would be relevant post COVID-19 and 12% thought their skills would not be relevant. The other 10% were unsure. So approximately a quarter of the respondents had concerns about their skills going forward. This belief was highest in India, lowest in the United States and I think that just mirrors the employment situation in those countries where the percentage of professionals that were let go or had their pay cut was highest in that area in India, lowest in the US, but we had asked respondents about their interest in gaining new skills and the impact of COVID-19 on that and over two thirds of the respondents said the COVID-19 pandemic had increased their interest in up-skilling. And you know, clearly professionals cannot take for granted their skills and the COVID-19 pandemic has shown the need to be a well-rounded professional. So now 75% of the respondents are currently working on improving their job skills. There's belief among all the regions that up-skilling can help advance one's career and increase one's job security. And when we asked what competencies the spots were looking to up-skilling, it was across a wide range of areas. Clearly cost management, risk management, were included, but also business partnering, performance measurement, cash forecasting, basically a whole range of competencies contained in the CMA body of knowledge. Rouba: (14:50) That's brilliant, what a confirmation. I mean, it just makes the content even more relevant. We're big on research at IMA and if anyone is involved in every single piece of research, it's you Raef, so we have to cross through, and it's amazing work that you do, honestly as someone who enjoys research as well from my end and the most recent global economic conditions survey, GECs, which we do in collaboration with ACCA, it showed, I mean, I know you said that the Middle East region was one of those that were impacted the most, but we did see in Q4 of 2020, a big jump in confidence in the region. I mean, surely there's the easing of geopolitical tensions, the continued recovery in oil prices and demand amongst other factors, but with the vaccines becoming more widely available, are there any hints of, you know, potential economic bounce back in the near future? Raef: (15:45) Oh, absolutely. Absolutely. It's you know, even without the vaccine companies are learning how to cope, how to provide a safe work environment for their employees. In many industries while there was an initial steep decline in sales, there was also a rapid pickup in activity and we're seeing in many industries that the companies can't keep up, I mean even with existing demand. And the rollout of the vaccine will only accelerate the positive trend in economic activity. So specifically in relevance to the Middle East, this increase in economic activity is going to increase the demand for energy, specifically oil. I think oil is up over $60 a barrel, currently, which is, you know, great news for that region that will, again, have very positive impact on the companies in that region. And then finally get a lot of organizations, you know, it's been a tough time, but it's also forced them to rethink their strategy, rethink their business model, so it’ll be coming out of the pandemic operating in a more effective and efficient manner. And now we’ll again, have a very positive impact for companies around the world. So, you know, specifically for the Middle East, but also globally I think we'll see, a very significant increase in economic activity this year. Rouba: (17:39) Excellent. I mean, it'd be great to see the world come out leaner and stronger, and we've been resilient, all throughout. So thank you for that little spring of hope at the end of the tunnel. Raef: (17:52) It's there, it's there, it's coming, it's coming. Rouba: (17:56) So I look forward to that and thank you so much for sharing the details of this report and the amazing work that you do. And yeah, we'll be doing more of these talks more frequently Raef. Raef: (18:10) My pleasure, and thank you for inviting me. Closing: (18:13) This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Twyla Verhelst: https://www.linkedin.com/in/twylav/Twyla's Links/Resources: https://linktr.ee/twylav http://www.freshbooks.com/accountants FULL EPISODE TRANSCRIPT:Adam: (00:00) Welcome back to Count Me In. IMA's podcast about all things affecting the accounting and finance world. This is your host, Adam Larson and today I'm bringing you right up to the start of episode, 113 with our featured guest, Twyla Verhelst. As we listen to this conversation, we first need to acknowledge that many accountants got into the profession because they are really good at crunching the numbers. However, the role has changed, and accounting and finance professionals are now asked to be confident communicators and storytellers. Twyla will walk us through the evolution of the position and give us strategies for overcoming introversion to be confident business partners. Let's head over and listen now. Mitch: (00:45) The accounting profession is one that typically attracts rather introverted individuals. Now there are many stereotypes about accountants and their personality traits, but in speaking with you, I know some of these stereotypes have evolved or proven false, particularly in today's industry. So would you like to give us just a little bit of background from your perspective on today's conversation? Twyla: (01:14) Sure. So, you know, I don't necessarily think that the personality types have changed per se. I still think that the accounting profession does attract rather introverted individuals and I feel comfortable sharing that when I'm an accountant and an introvert myself. But what I do believe has happened is that we're no longer your dad's accountant, or we’re no longer your Uncle Joe that used to be an accountant. Accountants now have a very diversified skillset. We have social skills, we have relationship skills, and oftentimes these relationship skills are what are driving the service agreements. We have the clients, that's the value they're paying for. They're no longer paying for what you slide across the desk at them every year on an annual basis, coupled with their bill that you slide across, that's just different, it's changed now. And there's so much more inside of the personality of an accountant that's being shared with the client and the client is valuing. So, when I speak of this previous accountant that I'm thinking of, I actually think of my parents' accountant in my head. I think of the man that we saw on an annual basis, my parents were entrepreneurs, we went and saw him annually. They helped with their personal taxes and their corporate taxes. And I remember specifically when I told him I'm thinking of becoming an accountant, he really just had five words for me, which was, do you want a job? He didn't expand. He didn't elaborate. He was very much an introvert. So now I think we're still introverts at the profession probably still does draw in introverts, but the stereotype of the boring accountant that fits in a box and doesn't really talk and doesn't really converse has changed. And that's, what's evolved inside of the industry. Mitch: (03:07) So typically, you know, many accountants will get into the profession because they're skilled at diving into the numbers, right? They like to work at their desk and crunch these numbers rather than really work with people. But as you said, the job has evolved. And you know, these accountants are asked to embrace new identities. You know, we look to these individuals as really confident advisors. So as the job evolves and the individuals grow within this profession, again, from your perspective, what is the first step for accounting and finance professionals to take when looking to make this progression and gain a little bit of this confidence? Twyla: (03:50) Before I dive into the first step, I just want to make sure that we're clear on the type of advisors that we're looking to be, or that we're trying to strive to be. And why I want to start there is because sometimes that's the barrier to us getting there, is that we have now painted this picture of, I need to be this really professional, highly confident, so knowledgeable, and use these big words and this accounting jargon in this financial jargon in order to fit that new mold. That's not necessarily true either. And so I want to just lay that out there because sometimes that's a roadblock to thinking, how do I get started? Because you're trying to get somewhere that I would encourage you not to get too far down that road, because now you've become somebody who's no longer the introverted accountant, but now you're intimidating or now you're talking over your clients or now you're really not in relationship with your clients because they're almost too scared to bring up what's going on inside of their business because of potential shame or potential guilt or potential, you know, getting inside of a conversation that they no longer understand and that they don't even feel comfortable saying, “I don't know what you're talking about”. So I want to make sure that we start there and then once we know that, alright, let's be professional and let's be advisors and let's be inside of a relationship out there, clients, but not take that too far. Then it's a case of starting with do some personal reflection. Where do you currently have a skill gap and do that self audit. Do you have really personable skills already and, that you've evolved or developed inside of your career thus far and now you're just layering onto that. Or are you the more traditional, introverted accountant, super, super smart, but loves sitting behind your desk and you know that you need to take steps towards breaking out of your shell so that you can feel comfortable inside a relationship or inside a conversation with your client. Or is it more that you're needing to do some other sort of, upping of other skills, which could be video calls nowadays, especially, where you've got to feel comfortable getting on video, presenting, doing that virtually, being organized to do that and not losing your place and feeling confident and having a loud, clear voice that everyone can understand and hear over the internet. What do you need to do to upskill? And so it's kind of taking that step back and saying, all right, here's what I'm trying to be. So once you understand where it is you’re trying to grow to, or stretch to then, where do I need to fill in that gap in order to be that advisor. Mitch: (06:41) Now, please correct me if I'm wrong. But I would assume that technology is a big reason that this evolution within the accounting profession and an individual's ability to effectively communicate and build these relationships, you know, this change is because of technology. I would say technology is now that person who was sitting behind the desk crunching the numbers, right? We have the software and the computers to do that for us and the human, the accountant, is responsible for the communication of the data that's gathered from the technology. So, utilizing this technology and kind of having that secondary relationship, what is the best course of action for a professional to increase their comfort and confidence in changing what they do on a day-to-day basis because of technology and then communicating what comes out of it? Twyla: (07:41) I completely agree with you that technology has really paved the way for this evolution, paved the way for us being able to have the technology be the number cruncher as you said, and gather that data and pull together really timely and accurate data more efficiently and effectively than we could do a number of years ago. I was going to say how long ago, but I don't want to give away my age too much. But, you know, when I started in accounting, we'd still number crunch. We sat behind the desk. We had the work to do, it was very manual labor. Now with technology that happens automatically when we're using the right pieces of tech to get that data for our clients. And as a result, that evolution or that shift has transpired. And so now you can be the communicator of what's inside of the technology. Cause there's two things with the tech firstly, not all tech is a hundred percent accurate and sometimes it's not the tech that's at fault, it's the information. It's what I like to say, “garbage in, garbage out”. So, if the data is not clean or the data is not accurate or current, then what the tech spits out is not necessarily going to be accurate either. So firstly, recognizing the data, or the inaccuracies in the data or the accuracies in the data for that matter, looking at the data and then once you're comfortable that it's accurate, what does this mean? And the client can't interpret what it means. Otherwise, you could just plunk the client in front of the technology and then say, there, my work is done, but that's not the case. Most business owners don't have that financial savvy ability to read and interpret the data in a way that's meaningful for them. So, you're like the translator or you're like the messenger of the data. Here's what it says. Here's what this means. Here's how this impacts your future decisions. So as a modern accountant, it’s finding your way or your place inside of the technology and the relationship with the client and being that intermediary in between. Mitch: (09:57) Well, we've already talked about two different perspectives on how the profession is changing. And as far as the individual within this profession, you know, our target audience, our listeners here there is this age-old adage that growth only happens outside of your comfort zone. So, whether we are talking about developing the soft skills to communicate, or if we're looking to develop some actual technical skills, whether it's with technology or enhancing our accounting skills, what is it exactly that accounting and finance professionals can do to get out of their comfort zone and grow? You know, how would you encourage individuals to really focus on their personal and professional development so that they can creatively evolve with the profession as time goes on? Twyla: (10:45) This is a conversation that's really near and dear to my heart. It's something that honestly I've spent the last two years myself on this journey of trying to stretch professionally in some of these areas that I recognized I lacked. So basically did that self-audit, what do I need in order to be the type of professional and advisor that I want to be, and it's going to be the best for my clients and really serve my clients and my industry of accounting. And it's a journey, and it can feel really overwhelming. In fact, today I saw a post on Twitter that said, get comfortable, being uncomfortable, get comfortable, being uncomfortable. And I believe that's true. That's definitely true that we need to do that. But just thinking about as an introvert, get comfortable, being uncomfortable, that can feel exhausting or that can feel insurmountable, or it can feel like where do I start? Or am I even motivated to start? So, I rephrase this a couple of years ago and I started on this journey of pushing my boundaries and getting uncomfortable to a phrase that I call, “comfortably uncomfortable”. And what that means is that I still pushed my limits and got uncomfortable, but not to the point where it was completely exhausting or it wasn't something that I could continue doing because it was just too far of a stretch. So, a great example of this, if we think about something that's not inside of the accounting industry would be, I decided I'm going to run a marathon and you don't go from the couch to running 26 miles overnight. We all know that, that's not logical. Instead, we take steps to get to the spot where we can run and finish 26 miles. And so typically you'd take steps to get there. Maybe you start with buying running shoes. Then you come up with some sort of training schedule that maybe you begin a walk, run program, and then a five kilometer run. Then you progress to half marathon. Maybe you find a running partner, download some music or some episodes of the account man podcasts. You do all these things to progress to the point of going from the couch to running 26 miles. So, that's what I call getting, “comfortably uncomfortable”. Where from the couch to the 26 miles, that's a stretch that feels like a lot. I can't run 26 miles every day, but I can comfortably take steps every day that's pushing my limits. I'm getting off the couch to the point of now I can run 26 miles and do that comfortably even though months ago, that was a big stretch. So, it's setting yourself up for success. So, if you think about your skill gap, whether that's soft skills or technical skills, don't take it on in a way that's overwhelming and you won't stick with it, take it on in a way that's piece by piece, step by step, incremental steps to get to a spot that you didn't used to be at. And so that's why I like using the phrase of getting, “comfortably uncomfortable”, setting yourself up for success so you can keep progressing forward instead of the words of getting comfortable with being uncomfortable, because that's true. It just feels too big, too overwhelming to make steps, to get the progress and the momentum to get to a spot where now you've, up-skilled. Mitch: (14:32) I think that's a great analogy. And I think it's a perfect example again, whether it's the soft skills or the technical skills, there are plenty of resources and plenty of ways to go out and step-by-step make progress towards that bigger long-term goal, for your personal and professional development. So, perfect story thank you for sharing that. I just have one more question for you, you know, in summary, we've already talked about how the profession has changed, individuals need to up-skill, why is it so important for accountants to be aware of their personalities in today's industry and, you know, kind of wrapping up what we've talked about already, but then how do you envision the profession changing even more in the future? Why do accountants and finance professionals today need to be aware of these skill gaps in continuously taking these small steps towards that marathon? Even though that marathon might be a different race in the future, you know, using your analogy. So, what do you recommend listeners do on a daily basis and why is it so important? Twyla: (15:38) Yeah, there’s no line that the marathon will change at your rate. It's a moving target. And part of that moving target is because this industry is wrapped into now the technology industry, as well as the accounting industry, we've come together with an industry that is moving very quickly and, versus accounting, stayed relatively close to the same for a number of years. I mean, it went from pen and paper to then some software and some tech, but the evolution of the industry in the past 10 years far outweighs the evolution in the industry for probably the 50 years before that. And so it's a moving target in constant motion, which means we need to be in constant motion too. Now, when we talk about the soft skill side, you know, the technology, there's kind of this technology hot on our tails of, if you don't progress forward and up-skill or move up the value chain, and you've heard all these analogies for it, then technology could potentially replace you. And the reality is that's true in a number of industries, not just the accounting industry, but it's something we feel this pressure or this heat of make sure that you don't get replaced by technology. Now, can that happen immediately? No. Can that happen over the next course of the next 10 years, perhaps if we don't keep progressing ourselves forward. So, I think that the soft skills are part of the equation or part of the workflow or part of the relationship that our clients are looking for. That is a very, very long time away from being completely replaced by technology. I think it will be further enhanced. I think there will be more communication even in the past year with, with all that’s transpired with people working remotely and working from home and relationships going virtual. There's been communication tools that have advanced significantly in the past 12 months. So, I think that that will still evolve, but you still need the human element inside of that relationship for the business owner. There's nothing that can interpret the data the way a person can today. Now, again, it's a moving target, but today, and so at least up-skill yourself in the technology side and the technical side and the personal skill side to ensure that you're kind of the front edge of this industry, this evolution, this collaboration of the technology industry in the accounting industry. You want to be at the front side of this evolution, not the backside. So that means constant motion, constant growth, that marathon that you've trained to run will shift. Maybe it becomes an ultra marathon, or maybe it becomes a marathon in a different location that's now more hilly. A couple years ago, I ran a half marathon in San Francisco, that was certainly different than running a half marathon in a very flat city. So it changes. And so you need to change with it and you need to grow with it, which means we're in constant motion. Just the way that the industry is in constant motion. So keeping ahead of it or keeping on the, at least the front side of it will mean constantly learning, growing, being curious, being creative, being flexible, not ever trying to fit inside of a mold of what you believe accountants should look like or should be. But instead that we're being creative around what they're going to be in the future and how we're going along with that journey of that transition. Closing: (19:38) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

International Women's Day: https://www.internationalwomensday.com/IMA's Website: https://www.imanet.org/Contact the Speakers: Hanadi Khalife - https://www.linkedin.com/in/hanady-khalife-78ba5610/ Doreen Remmen - https://www.linkedin.com/in/doreen-remmen-55173812/ Alain Mulder - https://www.linkedin.com/in/alainmulder/ Nina Michels-Kim - https://www.linkedin.com/in/ninamichelskim/ FULL EPISODE TRANSCRIPTAdam: (00:00) Welcome back to Count Me In and Happy International Woman's Day. I'm your host, Adam Larson, and in this special episode, my co-host Rouba Zeidan, sits down with a few of IMA's leaders to discuss what it means to operate, manage, and breed an inclusive culture. Keep listening to hear from Hanadi Khalifa, Senior Director of Middle East and India Operations at IMA, Doreen Remmen, CFO of IMA, Alain Mulder IMA's Europe Regional Director, and Nina Michel's Kim IMA's Director of Partnerships for Japan and Korea, as they all share their perspectives on social, economic, cultural, and political achievements of women and the value of diversity, equity and inclusion in the workplace.   Rouba: (00:46) Good morning, good evening, and good afternoon to all of you. Thank you for joining me and Happy International Women's Day! We're going to kick this off with Nina and Hanadi. So this day was created to celebrate social, economic, cultural, and political achievements of women, and it encourages women around the world to choose to challenge. I mean, the theme for this year, because as I quote “A challenge world is an alert one.” So this initiative was also created to accelerate women equality around the globe, and when you contrast that with the world economic forums prediction, that it will take some 250 years before we can achieve true equality. What are some of the major problem areas that you believe need to be challenged? Both when we talk about community elements and corporate world elements, and how are you personally contributing towards that on an individual scale and maybe even on a corporate scale.   Nina: (01:52) So, you know, I believe that in order to achieve true sustainable gender equality, society and companies have to change their mindset. It's not the quantity of hours at work that make an employee productive and also support working parents equally make it normal that men equally share household tasks and childcare. And I think society and the workplace prevent people from exercising their rights for these parental benefits. For example, you know, I kind of represent Asia Pacific and in Japan, new fathers are entitled to a relatively generous paternity leave, but less than 8% of Japanese male employees take it. As opposed to a more egalitarian country like Finland, where over 80% of the men take paternity leave. And, you know, the reluctance of Japanese men that could be for a number of reasons, perhaps it's not encouraged by the company, or  they might be judged that they're a slacker and we need to change the stigma associated with that and make it mandatory thatmen also take paternity leave. And in fact, that's a new plan that the Japan's labor ministry is actually thinking of to make it mandatory, for men to take paternity leave, and it it's to counter Japan's declining birth rate, which is a huge problem in Asia, because women don't want to have children anymore since it impacts their career. And, you know, as an individual, all individuals must have the courage to exercise their rights and stand up so others can follow. And, you know, as an individual in my former company, I was sort of a trailblazer and paved the way for other women to woman to, you know, discuss remote working and part-time working. But, you know, granted that was over 15 years ago, but that former company, they did not allow any, remote work or part-time work, and, you know, they were very supportive of promoting women, but only as long as they were single or childless or, you know, dincs, dual income, no children. So I think I was one of the first women managers to say that I was pregnant, and I really felt guilty to do so. To announce my pregnancy, which, you know, should be a joyous occasion, and especially, you know, it was coming after two miscarriages, miscarriages that I kind of, embarrassingly did not say to my employees of my employers, and I found out later that many women in that, that company had miscarriages. we were working long hours and on paper, the company even had, less than, required working hours, but nobody took that. I mean, especially nobody who were a high potential person climbing the corporate ladder. So, you know, when I did announce my pregnancy to the company, I told them things like, Hey, don't worry. You will never even think that I had children. I'll be back full time. I'd be here until the very last minute, and then I will take the bare minimum of maternity leave and I'll will be back to take off where I left off. And, you know, and I actually even did that for my first born. I enrolled him full time in the daycare center. I had babysitters to take him after it was closed and or whenever I was traveling because, you know, I didn't have extended family nearby to help, but, you know, I slowly came to realize how flat I was in my head thinking and it wasn't sustainable. You know, when he was about 18 months, he started acting up at the daycare center, you know, I kind of broke down and I went to my boss and, you know, I finally said, you know, that's it I'm leaving unless the company allows me to work part-time or work remotely and you know, the company finally relented, you know, and that action is so interesting because after that a whole lot of managers became pregnant or they were able to say, I had a miscarriage to Nina, all these kind of things and, you know, and it became okay to work like part-time, at least 80% or work Fridays at home. And, you know, so kind of, I take comfort that I finally became brave and ask for support from the company and it kind of benefited former companies, former colleagues of mine in that company.   Rouba: (06:26) No, but you're right, by the way, bravery has a big role to play in this one, to dare, to ask for more or for support Hanadi, how's that been for you?   Hanadi: (06:36) Well, I think Nina touched on, on a very important point, which is the change in mindset. And I think both men and women need, need to change that, and man has to realize that actually gender equality is beneficial and it's, in their interest as much as it is in our, interests. And of course the bravery for women, they have to proactively ask for their right. But I also want to add, three more, even actually four, more challenges, that we are facing saying, maybe these apply most to upward in the Middle East,. For example, education. Although we've done tremendous, effort and improvement in education, there are still 130 million girls who are, who don't have access to schooling, and there are 12 million who are married, that are under the age of 18 every single year. Of course also the gender gap. I don't want to talk extensively about that. I know we're all aware of the gender pay gap. Although we've seen that women now are more qualified, or if I may say, as qualified as men in terms of their post-graduate studies, and of course, women participation in the political arena, where again, in our region, there's a lot of effort that needs to be done on that front. And unfortunately, as if all of this is not enough, the, the COVID the pandemic, unfortunately, as well, had, a major impact or more negative impact on women as it was on men, because women are the main caregiver and they had to, to take more, unpaid leave from their work, which affected their, their job. And there's actually a very interesting report by McKinsey, on, on, on this topic with really interesting, statistics. Now from an individual level, I really do make a conscious effort every single day to challenge and recognize biases. As, as a mother, of course, I started at all. I have a daughter and a son, and I raised them both, and I make sure that, I raised them to raise their voice and to be active, contributors and agents of change, and as a team leader in my company, IMA, of course I strive really to become a mentor and a coach, to my team to create an inclusive environment where again, as Nina has mentioned, when team member are able to attain the right work life balance, which is also something I suffered from, throughout my, my career, and I'm really fortunate to finally work with IMA with a company that, really, cared for the employees. That being said, like the work-life balance, but as also, being able to achieve our full career potential.   Rouba: (10:16) Thank you for that,, and, you're right, by the way, we're very fortunate to be working, with IMA and I agree with you, you know, personally, I consider them to be one of the most gender equal companies that I've ever worked with, in my entire career. So I I'd like to turn to the only male, on this call, Aand so I support, first of all, thank you for supporting the cause.   Alain: (10:38) I'm really supporting it. So I think it's a really important topic, and that we should to reach gender equality as soon as possible.   Rouba: (10:46) Yeah. Before 250 years, I agree. And I think people, I mean, on an IMA level, there are so many initiatives that we've taken globally to kind of drive the conversation on diversity and inclusion and, you know, put these messages outwards by sharing, say for best practices, for example, but also, I mean, the focus is indeed on the finance and accounting profession, but when you look at the messaging of diversity and inclusion, it is a very global message by default. So what are some of the initiatives that you're undertaking in your region? The European region, to promote such values, on, you know, inclusion and diversity and what has been the feedback both externally from IMA team members and from external stakeholders as well. It'd be great to learn about your experience with that.   Alain: (11:35) Yeah, so, so what we do here in Europe, is that we really provide them platform for our members, but also, non IMA members where we can have this debate. So we have to Women Leadership Summit, we started at four years ago in Amsterdam, but now also do it in Switzerland and that's really a great forum for men and women to discuss what we need to improve on. So one of the things we found out last year, for example, during the summit, when we had some very open discussion and you know, how Dutch people are, they are really bold in their opinion during the event, and this was really good because they basically said, okay, we, what you often see is when women are making a career and they are doing ajob interview , for example, for their next promotion, that's men, or to hiring men, starts to think for that woman.. So for example, okay, I want to give her that great promotion, but maybe she can not handle it at home because she has to do the households and she has to raise the children. And that's a pitfall hiringmanagers make because we need to stop thinking for them. If they are, going for the promotion, then give them that promotion, and don't think about any issues that may arise in the future. And so we get great results with holding those kinds of events, because this was really an learning opportunity for female, of course, but also for the men who are attending. So next time when they are doing an interview, then they will stop thinking for them, and I think that's really a great achievement.   Rouba: (13:21) Absolutely. Hanadi in the IMA D&I toolkit that we were just referring to as well. One of the essential approaches for leaders to create a diverse and inclusive corporate culture is for them to promote a high level of self-awareness that kind of rewards that willingness to course correct. How much of this is dependent on the team leader who's managing, you know, people on a daily basis, but also what are some of the qualities and the skills that they need to actually possess or evolve, in order to become more self-aware, and when you've been in situations like this, do you intervene in order to bypass or highlight or deal with, you know, unconscious bias or do you effectively, how do you accelerate the process of fostering this kind of allyship, if need be?   Hanadi: (14:08) I think like everything we should lead by example, and it starts with the tone at the top and with, the, with the team leader to make sure we are fostering the right environment for our staff, but most importantly, it's the sell-side reflection because we have to start by our sense. And, I remember two years back of attended at IMA when we were still able to travel, in Montvale office, a cultural awareness training, and we had, at the end of the training, we had to do, an assessment test to see where we are in our cultural awareness, and I used to, like, I proud myself of having a diverse background, worked in many countries, and it was such an eye opener for me too, to see that there are still lots of, conscious and unconscious biases that I have to to deal with to understand and, to resolve. Actually I've, I've just, I was reading that the, in one report that says like 73% of women experienced bias at work, and yet less than 30% are able to recognize bias when they see it. So this awareness of and this education around biases is extremely important. And of course, as a team leader, understanding the cultural nuances, and navigating and pointing to being vocal as a matter of fact around, about these biases and encouraging most importantly, encouraging team members to be vocal whenever they either experience, bias, or, witness bias, a bias behavior. So that is really, it's really about the team leader to embrace this culture of a D&I and again, create that safe environment where employees feel heard and their concerns addressed.  Rouba: (16:50) Doreen, your a female CFO. I mean, if anything speaks female empowerment that does, and if anything speaks loudly about the values of IMA that does. So first of all, I, we are all inspired by you. That's something that I just want to put out there. So when we go back to the IMA D&I toolkit, it also notes, you know, that the whole program, in order for it to be successful, it needs to be part of the company's overall business strategy. So it affirms that top down nature of the process. How can a business strategy be diverse and inclusive, and what does that look like for you as a regional leader, as a global leader, actually, when devising your annual business strategy, for example, which has very key operational components to it and financial targets, you know, right at the core. So how does this so-called soft element for lack of a better word come into play, and how does it influence, you know, business performance in your view and your tremendous experience?   Doreen: (17:55) Well, thank you, Ruby. You're very kind. Yeah, I think there's a misconception among accountants that business strategy is all about the numbers, right? It's all about the budget and the forecasts and all of those things, but strategy really precedes the numbers and we call these soft skills, but they're actually the hardest skills. So when we look at our environment, we recognize that our membership is extremely diverse, across the globe, and, that's true for most companies. I think they have a diverse customer base. We want to make sure that we understand the needs and the differences, amongst all of our members and that we're, we're here to support our members. So that's our strategy. We need to make sure that we have diversity amongst our staff in order to be able to communicate effectively with membership in different regions, different ages, different career points from student to professional, to CFO, to CEO, to board member, these, these things are important and you can't have a good strategy without these skills of, you know, environmental scanning and understanding your, your customers and making sure that you know what they need. Hanadi referenced, an exercise that we as staff leaders undertook a couple of years ago, that was eye opening for many of us. And, you know, one of the things that was eye opening for me personally, I'm going to bare my soul here a little bit was that I had always, all my life looked for the commonalities, you know, the commonalities amongst people. I still believe that, you know, we're all equal, that God created us equal, but I would overlook the differences in order to find the commonalities. And what we learned in that bias training was that there are real differences and that we need to be able to respect those differences, navigate those differences, support each other, in who, as we recognize differences and, you know, different cultural differences or gender differences, age differences, that was eye opening for me. I had not realized that I have that bias. and now since then I have read more, I've been reading about different cultures. I've been really trying to overcome that, and, and it's been a wonderful journey for me. So I think I went a little off track there, Rouba from your question about strategy, but I am responsible for the strategic planning process. at IMA and, recognizing our customers, understanding the differences amongst our customers and making sure that each segment of our customer base our member base, I should say, has what they need at their point in their career to support them to be able to achieve their maximum potential, and we all have the same potential.  Rouba: (21:10) And we all have, the same potential, no, that's, so much to learn from. I really hope that we rub off globally and, you know, we teach these best practices, and I refer back a lot to our, you know, DN& toolkit, because that's been really, a really a body of work that I'm extremely proud of as, you know, coming out of our team at IMA. Alain, you're using this with your team, in Europe as well, you know, to kind of distribute these, share these ideas and these best practices for that can be shared by organizations and various different functions. So these have been used a lot, the insights have been incorporated into a lot of content. you know, whether it's editorial content that's distributed to the media, or even shared with members, how has the response been, in Europe in general and maybe beyond as well, is there an appetite for this type of conversation to kind of be driven even further? and, and how, how is gender equality treated in general, you know, as, what are the common practices that you've seen, or not so common in your area?   Alain: (22:14) Yeah. Fair, good one. Though there's a greater appetite, actually, what I see at the moment, here in Europe with, especially here in the Netherlands for gender equality, you really see the, the political debate, of course. so in the Netherlands, for example, we do have an issue, in like in many other countries that there's not enough represent representation of females within the, in the top, therefore in the board really often, in all the management of companies, I believe it's below 30%. So you really see that there's momentum at the moment that people want more diversity in companies because many people or most people, at least within companies now understand, like the reset, that it's also for a strategy, much better. if you have a diverse company, then also your customers will recognize themselves, which are company more and also your brand. So that's something they see, but also, I was scrolling on social media a few weeks ago, and then I came across research from the international labor organization. and it was really interesting because it was showing, the countries where it's most likely they have a female as a boss, and Jordan was on number one, and what you often see is that people think that in Western Europe, we have equality, but actually that's not the case in Netherlands. 70% of the women are financially dependent of their husbands income, and, or 50% that says, and what you see is that 50% of the women work part-time, and then, then that's, and if you work part-time, or full-time actually, that doesn't matter because it's about the quality of your work, but what you now see in, and then on that the majority of women start working part-time when they just graduate from university, and then it can become an issue, because if there's a promotion within a few years, then the, the men, they have much more experience at that moment, and that's the debate we see here in the Netherlands at this moment that the inequality between part-time and full-time is becoming an issue here. And this also a debatewe see now here, that that's something to improve on.   Rouba: (24:44) You're right, by the way, even I have that perception that the Netherlands are the most equal, it's the most equal country in the world. So, yeah, misconception there.   Alain: (24:54) That's indeed a misconception, and, of course in many things, we are equal here. but in, in, within this issue and this topic, then it's, there's much more work to do.   Rouba: (25:05) Do you find, like, like Andy mentioned earlier that COVID has kind of, revealed that a problem even more, and especially in, in a country like yours?   Alain: (25:17) Yeah. That's something you see at a moment, because what you now see is that, women are most, they are when they work full-time or part-time, then they're also doing many things in their household to raising children. And if you have to do both, that's becoming an issue. And some men, they only work and they don't care about things going on within households, and that's something that has been refueled by COVID. And I believe that that's really something that has to be changed. I think there is no excuse for men to do nothing within the house. So yeah, so, but you have to have the discussion with your partner. What, how, what, how you define things, because for example, I'm a horrible cook, so I'm not going to do this, but I love cleaning the house. So that's something that I do, and this is how that's how, yeah, and, but my wife is much better in other things. And then she's focusing on that. So that's really the discussion you need to have within your own household. And sometimes, maybe the other one is doing a little bit more and sometimes the other one, but that's really the discussion you need to have, and once again, there is no excuse to do nothing within your household.   Rouba: (26:38) No, it's a wonderful attitude to have. I like that, and yes, if the cooking's not working, please stay from the kitchen. Alain:Oh yes, I will stay away from it.   Doreen: (26:48) I have a question for Alain. Do men have equal opportunity to work part-time in in the Netherlands? So, you know, in a family, maybe where the woman's career is where she has extreme talent and is on a track to a leadership role, is it acceptable for her husband perhaps to work part-time, and, you know, take a step back? Is that socially acceptable?   Alain: (27:19) That's actually a very good question. Unfortunately, the answer is no. So of course, when you ask people here in the Netherlands, okay. Is can men work part-time or stay at home? For example, then most people will tell you, okay, yes, that's possible, but socially it's not respectful that people will not do it, actually. So that's also what you see, for example, at schools, when you ask the discussion, when, when mothers work full-time, they blame the mother for sending the children to daycare. They don't blame the men. So that's, I think over the announcer that's, they're blaming the women for it and not to men.   Rouba: (28:03) That was a good question. Doreen. So Nina let's, let's pause this chicken and egg scenario or catch 22 situation, if you like. In many ways, diversity inclusion is considered a societal issue and that the burden truly falls on the shoulders of the community leaders, basically, you know, the grassroots level, but with so much practice or malpractice, if you like spilling over into the workplace, it kind of becomes this magnified version of the problem. How much of the responsibility is shared by corporate leaders in your view?   Nina: (28:39) Yeah, so I think Hanadi and I, we touched upon it in the, you know, the very first question about how companies should also encourage the employees to take, make the most of their parental rights and benefits, but what I think is very interesting is that in our field, in finance and accounting, there is the movement towards sustainable and integrated reporting. I hopefully think that this will improve, the attainment of gender quality, because, you know, it is part of the ESG, the environmental, social governance metrics, corporate social responsibility reporting, hopefully will also help in that. You know, Hanadi and I have written about some, articles about gender quality, number five of the UN sustainable developmental goals, and you know, you, if you're in, you're not hypercritical, if you're walking the talk, you have to, all companies have to, do their best to meet this, And, I wanted to point out that I heard a podcast recently, the CEO of Blendoor.com. This is, a very interesting podcast. Blendoor.com is a data analytical company, and they actually rank US public companies according to their D&I metrics and the CEO, she is a black woman herself in a very male dominated tech field. So, it's very inspiring, and, she formed this data analytical company to prevent unconscious bias in recruiting, but then you can use that data to actually rank the companies, and this data is very helpful for ESG reporting, but it also helps potential employees to, before they accept a position. So new diverse talents can go through and see is this company, I just say, like, Amazon, how are they ranked here? And would I fit in, in this am I, if I'm a diverse talent, would I fit in as a woman, et cetera. So this is pressuring companies to improve. and, I think this is going to be very positive for everyone.   Rouba: (31:04) Absolutely. I mean, it does start somewhere.   Hanadi: (31:07) Yeah, so I like to add just one thing here. We've talked again about the shift in mindsets, for the individual, but that also has to happen on, on the corporate level. Companies have to understand that they are a social entity above all thing, and they have a responsibility to where it's the community, the country, the market, they, they operate. And we've seen that shift, still a shy shift from the shareholder to the stakeholder, but a lot, is still to be done. And I think once, once companies, senior leaders start, acting as social, you know, as leaders of social entities, we, the impact, would it be great on the community and on individuals.   Rouba: (32:10) You're absolutely spot on, I think, you know, this perception of it being a soft element and whereas Doreen highlighted, so, you know, correctly, it's actually a very hard and difficult element to achieve, but I think, it's a misconception that, that happens on a corporate level. And when you look at the staggering evidence, like you have the likes of McKinsey global Institute, you know, their study found that gender diverse organizations have a 15% higher chance of gaining above average profitability, then, say non gender diverse companies, another study found diverse workforces experienced 35% increase in performance over non diverse ones. And then again, over that, a Boston consulting group study found that such companies generate 19 times more revenue than non diverse teams. I mean, it's really good for business, but why do you think, is it good for business? I mean, we've seen that. Why, why is it so important? Why does it work?   Hanadi: (33:11) It's actually not only good for a business it's also good on a country level because there are also a research by the World Bank and thereby, and by the IMF, that points to a strong correlation between, the countries progress in closing the gender gap, particularly in education and labor force and its economic competitiveness. So everybody's a winner on a corporate level and on a country level. Now, I think, mostly probably because women tend to work harder to prove themselves, and they are able to create a more engaging, work environment, and as a result, I think they are capable of rallying the team around the company's, goals and mission, which will also result in higher retention and in job satisfaction which we all know increases as well, productivity. It's really, really about creating this diverse workforce. Also in a diverse workforce, you, you could see resolve problems or look at opportunity from different perspective, and point of view and your team is, is I think more place, to challenge the spectra school and, the way things are done. yeah. That's, which of course will improve the decision-making, and as I mentioned, increased productivity overall.   Nina: (34:54) I actually wanted to add something there too, because I completely agree with Hanadi and what I think is interesting is very brief, but working parents in general, I think, again, I'm going back to this that, you know, it's not how long you're working, but it's how you work smarter and more efficient. And I think if you have a set end time. So I'm talking about working parents where you have to pick up somebody from the day care center, every hour working hour, that you're there, you are much more efficient. And if I compare it to, when I was single and working long hours, I had no time when I, you know, I have no set return time, then you could stay on forever. But I don't know if my productivity I don't think it was as good as now when I have, okay, now I have to do cause I want to go and correct the homework with my daughter or whatever, and I think it's much more efficient, and for the company, the event, the company performance of course improves that weight. That's what I think too.   Rouba: (35:51) Nina, I read a study today that said that the parents are saying, you know, parents who work from home and homeschool, they're saying the biggest interrupted an average of 10 times per day. Is that an accurate number? You think some people said, no, it's 10 times an hour.   Alain: (36:10) Yeah, I think so. But yeah, but that is true, and I think that, that, that's one of the positive things of that we are now all working from home is that a lot of people, a lot of companies now see that it's actually possible to work from home, because we used to have some companies or managers who were a bit reluctant of that, and they really wanted to have their stuff five days a week within the office. And maybe that's one of the improvements at this moment is they see, okay, it really doesn't matter if people are maybe for a few days working from home and a used the lunch break or a few hours during the day to do some homeschooling with the children or to, to something else. And then they work in the evening. So I think that's one of the positive things of this moment, and of course, technology is also a big enabler for that, because it doesn't matter where you are. If a thing is in the cloud, you can work wherever you want. So it doesn't really matter anymore.   Rouba: (37:07) Actually, that, that was very connected to my next question and Alain this question is to you and to Doreen, indeed, you know, this past year has been so insightful beyond measure and so educational. It disrupted some sectors, accelerated others destroyed, a multitude of others, but ultimately it put a huge burden on not just women as we noted earlier. Yes, indeed, probably women suffered the grades are grunt, but on parents and families in general, and that whole idea of working from home, but how do you think companies can actually help to reduce that pressure and, you know, at a time of pandemic, and I'm sure we've had to do a lot of that at IMA and as leaders you've had to do that for your team. So what are some of the best practices that you've seen with regards to alleviating that pressure of your team members?   Doreen: (38:03) Well, I'll start question was for me and Alain, but, know we are concerned not just about the pressure on women, but also the pressure on our male colleagues as well. And I think that both genders benefit from family friendly workplace environment, I think Alain would agree with that. So we've, you know, we've, scheduled Friday afternoons. Most of us continue to work. It's not like we have Fridays off, but, and this, of course it's different in Hanadi's region, but no meetings on the, you know, some days they're just no meetings blocked. I think that's important. We've also, brought in resources for employees to access for mental health counseling. Those kinds of things are also really important to recognize the stress and to alleviate it. I think that we need to make sure that, the man that we're working with who also worked very, very, very hard are also given opportunities to support their families and, and be, available to their families. This pandemic has, changed all of us changed the workplace. It's going to be very interesting to see, how we all come out of it in the coming year.   Alain: (39:23) Yeah, true. And in that thing, indeed, children is to share its obligation between men and women's. So, if there is something, yeah. If they are sick for, for example, then don't make a fuss about it. If you're a manager, allow them to go to school, to pick up your children and then to take care of it.  I think that's really setting an example, not to make a fuss of it. It's, they will probably do within the evening and then it's all fine again. And, yeah, as a manager, sometimes you'll do something, something, sometimes you win something. So they, for a few hours, they are way, but later on, that will, that will be fine again. So it's a shared obligation. I really believe.   Rouba: (40:04) And I mean, we talk about the, the, the role of corporations in, in all of this diversity and inclusion conversation, but when, when it comes down to it, where IMA, and IMA, has a dedicated D&I Director, I mean, their core focus is driving the practice internally, and then seeing that resonate obviously with external stakeholders, but let's be realistic here. You know, not all companies have that same level of luxury or scale or capacity to assign a dedicated D&I lead position. So, and this question is to you Doreen, because you're, you're a part of the steering committee, if you like at IMA, and if you were to give advice to corporate leaders, you know, who in the interim, until they have a dedicated D&I director, how can they create encouraged breed that kind of culture and nurture it on the long haul? And then who's supposed to actually take ownership of this when which function is it HR? Is it a C-level position? Is it a function leader? Is it all of the above? How do you go around doing it?   Doreen: (41:09) Those are really, really important questions. So it has to be owned at the top of the organization, know at the CEO level, it must be embraced diversity, equity inclusion must be core values that are embraced at the very top of the organization or anything else will be meaningless. So, you know, I think that's, that's the most important thing. there needs to be an element throughout, so HR needs to embrace diversity, equity and inclusion in its hiring practices and making sure that supervisors are acting appropriately. Of course, that's an HR function, but it's also in a, the market development function. You need to recognize who your market is and who, who you're marketing to and understand that for diversity, equity, and inclusion. I hope that we're not, that companies are not jumping on a bandwagon and thinking, okay, we need to create the diversity and inclusion role and that's it, you know, then we're done. That reminds me of tokenism. that was so prevalent when I started my career, you know, back in the seventies. That's just not going to work, you know, saying, okay, this person is the face of diversity at our organization is absolutely the wrong approach. It needs to be, throughout the organization and smaller companies can absolutely achieve that, through, consciousness raising, awareness training through, you know, embracing this as a core value through reading, through sharing, bringing in consultants there are remarkable consultants that can help organizations to recognize where they have gaps and what they need to, to fill. Our diversity toolkit that you've referenced, Rouba, is one of many resources, that companies have available to them, but it needs to be made a priority at the top of the organization and embraced throughout and not resident in one department or one role.   Rouba: (43:28) A beautiful recommendation actually. Thank you, Doreen. So this is a question that I would love to hear all of your views on, and whoever's comfortable answering first, please go right ahead. So when we look at women in senior management roles, the big, big question, you know, that everyone's been researching and investigating for years, it's probably one of the biggest challenges because no matter how much that segment has grown, it's still a minute. So when we look at say 2019, the numbers grew by 29% and that was maintained throughout 2020. and then you look at the fact that the global midmarket and global midmarket companies have at least one, a woman in a senior position, but senior position, that's 87% of them. So these are really promising figures, but then you look at, you know, the history of that when you all started your careers, this was not the scene and it was far from it. And having three women on this podcast probably you've had to really find your way to the top, to become of the senior leadership team. What was a kind of defining moment that you've been through where you thought, wow, I can see a dynamic shift. Things are not the same anymore, I'm in a new era. So what was that instant that you realize that things are really changing and I'm privileged to be in that? And I can, I can go all the way to the top.   Hanadi: (44:54) I can start actually, and without really undermining all the encouraging steps that companies and countries are making, are making two words, equal opportunity, equal, gender pay and what have you. But I cannot say that the dynamic shift has happened. I mean, to me, yeah, to me, I still see around me, women paying a very high price for their success, making huge compromises, especially if they're a working moms. And, you know, I touched a lot on that. So, and to me, as long as we still meet the quotas to ensure the equal participation of women in leadership position, that means that there's still a lot, to be made. And I, and I think it also, there's a, there's a big role for the government, especially in our region because legislations have to be made to tackle these social and cultural barriers to encourage more women to enter the workforce, and again, I also think that with the fourth and the fourth industrial revolution, the digital revolution, this also will have a great impact on women participation, because we've seen, women, presented and STEM education is still low, especially in our, region. So there's still a lot to be made to, for me to say that there's a dynamic, a dynamic shift. Yes. that are, you know, there's the willingness to change, but still a lot, a lot to be done.   Nina: (46:55) Yeah. I have to agree also with Hanadi, but what I see to be like, maybe put some positive spin. I believe that the, the generations after us, so we're, there's baby boomers on here. We're Gen X, most of us on this call. I mean, we faced a lot of, this old fashion cultures., but I think that maybe the millennials and Gen Y Gen Z, I mean, they're going to be, I think they're going to put work-life balance also, have that as major focus. I mean, we already, we hear from Alain that he has a, as a male saying, this is good, but it's actually, you know, our parents, you know, do they support that? They were also had this old fashioned ideas, you know, maybe not all I'm saying, but you know, you men couldn't take paternity leave maybe because their parents said, Hey, what, what are you? You can't do that. You're a male and things like that. But I think that's changing now, and, and that is not yet a dynamic shift. I agree with Hanadi, but I see it changing and Rouba, you know, we did that webinar last year together about reinventing organizations. You know, this teal organizations people want to get out of this toxic work culture. They don't want to be just climbing up the corporate ladder just for money. I think they want to master all of them. They're embracing more, even this pandemic. I mean, you want to have family, hobby work-life balance, you know, not be stressed, you know, meditate, all these kinds of things. I think this is going to help everybody in the end. Hopefully the, our younger generation.   Rouba: (48:41) No, you're right. That Generation Z takes, takes everything, at a much higher volume and they fight for their rights so easily. It's effortless to them. And Doreen, how's your view on this?   Doreen: (48:54) So I've been in the workforce for four decades, quite a long time and old stories I could tell, but yeah, breakthrough moment when I, when I had a great deal of hope was when my son, you know, I have three adult children. My youngest is in his thirties, and I remember when he was, you know, mid twenties and had just gotten a promotion and he was working for a leader, a female leader, and to him, it was no different. Like he wasn't, he wasn't complaining about the boss lady or he was looking to her for leadership, for mentorship, for, you know, career progression, and I thought, yes, that's great. So that was a moment for me that I remember really clearly. but there have also been other moments where, where it's a stark reminder that there's still work to be done. You know, where, you know, where a woman will be automatically tasked with taking the minutes of a meeting, for example, or, or excluded from, you know, some social aspect of work, these things still happen, and, we need to be conscious of them and we need to focus on equity and make sure that we are filling those gaps and giving women the same opportunities and the same respect in the workplace. So one, one thing that I think is really important for all of us is to pay attention to other people's daughters, to think of people entering the workplace, as you know, the sons and daughters of your friends, your family, men have always taken an interest in other people's sons and, coached them and, you know, been leaders on their sports teams and, boys grow up knowing what their, parents, friends, do, you know, the male partners. We need to make sure that we're paying attention to other people's daughters and making sure that they understand what opportunities are available to them and giving them a leg up, explaining something to them, helping them to see what the path is because it's not always clear. You don't always know. I wish I had had that as a young professional. I wish I had had somebody paying attention to me that way and giving me good advice and not having to figure it all out. So that's something that I have tried to do.   Rouba: (51:42) And yet you've done so wonderfully for yourself without all that mentorship. Can you imagine if you had mentorship, you'd be president.   Doreen: (51:52) Maybe queen, I don't know.   Rouba: (51:57) And I mean, Alain, you're the male, kind of a participant in this conversation. And so have you noticed any kind of, maybe it was like, Oh, there are quite a few women in this room, or when was it like that you noticed that women were gaining more ground and more freedom and, you know, how has that felt for you?   Alain: (52:20) Well, actually my first manager is she was a female, so I'm really used to it when I graduated from university, but, but for, well, you, you see that it's really changing now. So, of course IMA is a great example. I believe almost 50% of the global board of directors are women. Also, when I look at my colleagues within IMA, like now most of them are women. So I think that's really good, for IMA, but what I really think was a breakthrough moment was, and not for my own career, but a while ago I saw a press release from an audit firm here in Europe, announcing the new managing boards, and all of them were male. So, and that, that's not good of course, because we just had this whole discussion. So, and then you saw people within, on social media, but also on, in the media itself, questioning that company. Okay, why are you doing this? And I think that's really important. That's when we see that the companies don't have representation or really low representation, you know, female within their board, that we questioned them. And that's something we should do as a customer, as an investor, etcetera, but as an employee as well, because it's not a good thing, because of financial reasons, because of ethical reasons when there's not enough diversity. And I think that was really an important thing because you didn't see that at least I didn't see that 10 years ago.   Rouba: (53:51) That's great. I mean, I don't think anything celebrates, an International Women's Day like hearing all of these beautiful views, very empowering from the males and the females equally, and again, you know, being part of IMA is truly empowering on its own. And I'm glad that we get to record these podcasts and share these kinds of messages with the world. So thank you so much for your generous, sharing and contribution to this session, and indeed Happy International Women's day to all of you.  Closing: (54:26)This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Miguel Molina: https://www.linkedin.com/in/miguelmolinaprofile/FULL EPISODE TRANSCRIPTMitch: (00:00) Welcome back to Count Me In, IMA’s  podcast about all things affecting the accounting and finance world. I'm your host, Mitch Roshong and today's conversation will cover the topic of leadership and how finance leaders accelerate change. In episode 112 of our series, Miguel Molina, CFO at Avocados from Mexico talks about his career journey and what he has been able to overcome and accomplish through effective leadership and change management. Stay tuned as we listened to his conversation with Adam now.   Adam: (00:41) So Miguel, can you tell me a bit about your career journey?   Miguel: (00:45) Sure, Adam. Well, I'm the son of Carmen and Hector, and Carmen, my mother was a visionary woman and, my father was a successful entrepreneur in southern, Mexico. I'm a first generation going to college. Actually my, my mother was the one who convinced me to go to Northern Mexico to pursue a degree. And even she said, look, who knows, maybe you may end up working in the U S. And so I did my undergrad in accounting in northern Mexico in one of the most prestigious university in Latin America, which is Monterey tech. I graduated with honors in December, 1994. 1994-1995 was a difficult years in Mexico. There was years of economic and political turmoil. Mexican economy style deficits rose. Politics became unstable and even some politicians were assassinated. And after 75 years, the PRI to the main party in Mexico, lost government control to another party after 72 years. But, so despite all these changes as a young student, I always wanted to represent Mexico and work for an international company in the US. So I've quickly realized that I needed to improve my skills, Adam. I decided to sell my car both to Canada, I spent three months to improve my English skills. Vancouver, Canada was a great, great experience, but also my last year in college, a teacher of mine, actually a corporate executive and one of the largest tortilla corn meal companies in the world invited me to join Mission foods here in the U.S., and I did. and I started, I started internal auditor. I had been fortunate to travel to the U.S, and I spent a fantastic 18 years careers at mission foods. And I took a position in Southern California as a sales and distribution accountant. Company gave me a full region moving from Washington, Oregon, Montana, Idaho, Nevada, Arizona, and New Mexico. Eventually our corporate offices were moved to Dallas, Texas, and we relocated in 2003 and they gave me all U.S. responsibility for the sales and distribution accounting. Then in 2009, as all we know the U.S. experience a great recession, and also needed to improve my skills. So I pursued an executive MBA at Southern Methodist university, and graduated with honors in 2011. Around 2014, the former VP of marketing for Mission foods moved to Avocados from Mexico, as his precedent and CMO, and he invited me to join Avocados from Mexico.  I  accepted, and now I'm at the CFO, one of the most exciting and successful problems, marketers organizations in the U S Adam.   Adam: (03:39) That's great, and I'm a consumer of avocados from Mexico. So that's very exciting to talk with you today.   Miguel: (03:47) Excellent. You'll be surprised that eight of every 10 avocados consumed the U.S. come from Mexico. And just as a trivia, you need to know that avocados is a berry it's from the same family of a berry.   Adam: (04:01) So you have a quite, quite a journey that you've come from, you know, where you grew up in Mexico, all the way to where you are today. What leadership characteristics have enabled you to get where you are?   Miguel: (04:12) Well, there are a few topics that I can see in my career. I'm borrowing some items from the leadership tools begin with the end in mind. I think that that is very important. Be resilient and lead by example, and yes, some, some good old luck, Adam. Let me tell you a quick story about, about that. When I was in college, a classmate, invited me to spend a spring break with him at his house. He is from Queretaro, a state located in central Mexico. And during his family dinner, he talk about his plans. I remember him saying that he wanted to finish university, pursue his master's degree at the University of Michigan, go back to home to his hometown, and became the mayor of his hometown and then become the governor of his state. I was in awe. So wait a minute, here's a guy, my same age, same age, education level, both  were doing very well at school. With such plans unbelievable because until then my goals was to go back to my hometown and work for my father and my family. But I have to say that that made that night, my life change, I dare to dream. I decided to do well with school, learn English, pursue an MBA and work for an international company. So beginning with the end in mind, I think is, is important, be resilient, be consistent and always lead by example, Adam.  Adam: (05:46) Definitely, and you know, I'm sure as time has gone on your job role has changed as an expectation changes. We're in the middle of a pandemic still, you know, how have you been able to develop your change management skills and make everyone aware of the necessary changes as you've gone along?   Miguel: (06:02) Change is always being consistent, and I follow an author, Yuval Noah Harari, and he wrote one of the best sellers book, Sapien. And he's an extraordinary philosopher, historian, and storyteller, highly recommend to you and your audience to look for him, Yuval Noah Harari. So he makes an interesting analogy. He says, Hey, listen, in the past, we were thought to have any strong and deep foundations, it was very important, right? So like a house, if a hurricane or a strong wind passes, that foundation will keep you grounded. Well, today he says the knowledge is different. We need to have a mentality of a tent. Yes, like a camping tent and be ready for significant changes on a strong winds. So when that happens, now, what we need to do is to pick up a tent and move to another place. So let me say Harari talks about the most successful skills in the future will be the capacity to that capacity to change, right? Including the psychology of change, because in our lifetime, we need to reinvent ourselves so many times. I'm sure you Adam, me and all of us, your audience have we need them force or to reinvent ourselves. Right? So during my career, I've been very fortunate to work with great leaders, Adam, and it gave me the freedom and the confidence to make changes. So over the years, I have reinvented my position many times, I expanded my responsibilities to other areas, including technology, and continue process improvement, and I'm upstairs. We've improving processes and finding efficiencies and  changes come with risks. I have some battle scars for sure by that. However, if you're prepared to business case and take a small risk to test your ideas, you gain confidence and that the company where you're working with also begin building that trust in you, Adam. Adam: (08:00) Definitely trust is a huge factor, in, in any type of change management. Is that what you use to kind of get buy in from your stakeholders in your organization as you made those changes? Miguel: (08:14) Yes. Yes, Adam, listen, I would like to talk about a time when I failed and I failed badly. I was working for my previous company. I convinced your management that we needed to invest in a trade promotion application. I created a vision, tackle it at a potential savings company, senior management authorize the investment and I failed. And I failed because I used the word I all the time, and I felt that working hard was enough, but is imperative is critical to include all the stakeholder and all the senior management, but a way I have to move from the word I, to the word. We, because as the saying goes, there is no I in the word team, right? So in any new initiative, it's critical to get buy in,\, not only from a good way to test your ideas and how viable those ideas are, but also to make it a reality. So I have four main observations that I will recommend in my experience. And first we need to begin with your team or your immediate circle of influence. And so that includes people reporting to you, your supervisors, but also be mindful of those indirect hierarchies in the organization. There's always some key stakeholders that they may not have the title, but they have a big influence. Number two, is that, it's all about the why. So I read also I follow Simon Sinek. He's a best-selling author, and he talks about people come to bid the best when they believe in the why on why they do that. And of course we are the finance team, right? So we need to find a strain in the numbers we are finance. Our job is to allocate capital, to support a company goals and prepare a robust business case. That is the must. You have to have a robust business case. I mean, build others, Adam, share ownership and recognition. Bottom line if your coworkers are more likely to succeed in a project and do better if they feel ownership in whatever they do. Adam: (10:37) I wanted to just circle back. when you mentioned, when I asked you, you know, how do you get buy-in from your organization? You know, you mentioned that the first thing you mentioned is like, let me tell you about a time I failed, and I want to just ask a follow-up if you're okay with that. It seems like many times people want to focus on everything they did well, and they never mentioned the failures. How have failures helped you get where you are today? Miguel: (11:05) Listen, Adam, when you take risks, you will fail, but failure is not really a, the problem is not learning from failure by, and that seeing that taking that learning is that brings value to the organization and your practice, and we need to take that seriously and also create an environment where your team with failure is susceptible. Now, if you don't want to fail, it's likely that you don't want to move. You stay and do whatever you're doing all the time, and then everything will be okay. But like I mentioned, re-inventing our positions every time comes with some failure. So learning from it is what the value is about. Now you need to be creative by not taking massive failures, but also taking calculated risks where you prove I'm pro your ideas, and once you feel more comfortable, you move to the next step. And that is important because changing our mentality as number of people who were used to have everything calculated to move. Now, it's not quite like that. IN a digital experience, you need to be flexible test and then be flexible and test again, and then move. So I think that that flexibility in failure is important, Adam. Adam: (12:32) So how do you envision the role of a finance leader growing even more in the future? Not necessarily, the changing of what you do day to day or the building of sustainable culture, but from a leadership perspective, how do you see your position being more, even more valuable? Miguel: (12:49) I truly believe that the CFO is a new CIO, Adam. Our finance team is moving from achieving operational excellence, which is a lot of what we do right to a new emerging role, and that is to support the modern workplace, be at the center of the process, towards a customer digital experience, and really for us to be in a competitive advantage. And I would like to call out Microsoft CFO, Amy Hood, and one of her conferences she'd say in coding, by adopting innovative technologies, finance will strengthening the business leadership through compliance, accuracy and efficiency, closing quote. So really I generally believed that the CFO is the best position in organization to work with all the leaders at him and take advantage of this digital revolution.  The finance team, understand the operation. We understand the operation and all the possible efficiencies in our organization, again, where we can allocate capital and to sustain growth and really identify those key metrics to improve performance. But at the same time, Adam skill sets need to change, and we need to have a much deeper understanding enough of analytics and to have a strategic thinking, work with our precedent on the strategy. And we need to learn to influence and negotiate, right, and to advance a business, and also to understand our customer not only in our numbers, but also our customer. To have that as strong customer knowledge. Let me give an example, here at AFM, Avocados from Mexico. We recently embarked on an initiative to implement a business intelligent application, and we believe that everything begins with a digital transformation really begins with a good, solid, reliable data. We have to have good data. So, and we move all our applications on the cloud and we move our accounting system to now an SAP by design, which is a cloud solution, as our core accounting system. We connected that data to SAP concur, and we also implemented adaptive insights, bad budget planning tool, and to start synchronizing data, as well as, DocuSign as a contract management life cycle solution. After we achieved now that core data, and we felt that we were ready to start connecting data points. Now we have this structure and we've started to work for an analytics solution, and we'll move to look at multiple technologies, including SAP, Microsoft, Tableau, and we decided to move with a Microsoft power BI and to start connecting data sources. That is our next frontier item, data and analytics, and to take really our company organizations to the next level and of course contribute to our competitive advantage in the marketplace. Closing: (16:03) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Serena Wolfe: https://www.linkedin.com/in/serena-wolfe/FULL EPISODE TRANSCRIPTMitch: (00:00) Hello and welcome back for another episode of Count Me In. Mitch Roshong here with you again and today you'll be hearing my co-host Adam speak with Serena Wolf about CFO role in implementing an ESG agenda. Serena is CFO of Annaly Capital Management and has over 20 years of experience in accounting. In this episode, she addresses the importance of environmental, social, and corporate governance and how CFO is truly influenced each letter of ESG. Keep listening as we head over to the conversation now. Adam: (00:38) Serena, thanks so much for speaking with us today on the topic of ESG and to provide some background for our listeners who might not be familiar with Annaly Capital Management, it would be great. If you could begin by providing our listeners with an overview of Annaly and your industry and some your specific role within the company. Serena: (01:02) Adam, I would love to and first I want to say, thanks for having me today. Annaly is a leading diversified capital manager that invests in and finances, residential and commercial assets. We were founded in 1996, and we went public a year later on the New York stock exchange. We are in fact, the largest mortgager REIT, and we have four investment teams. That's our agency, MBS business, which represents approximately 93% of our total assets. We also have a residential credit platform, a commercial real estate division, and a middle-market lending. Currently we have a market cap of over $11 billion and over $100 billion dollars in total assets. And with that  market cap of over $11 billion, we have the largest capital base among our peers in the mortgage REIT space. And so let's talk quickly about REIT I guess, just, for your audience as well. REITs are often public companies, but specific to REITs, we are a taxable election. In fact, whereby we have to return 90% of our income to shareholders. So we're quite popular with those folks that want a dividend yielding stock, like pensioners, and things like that ..And broadly speaking REITs can be broken down into two major categories, equity REITs, which typically own and operate income producing real estate and mortgage REITs, which provide financing for purchasing or originating mortgages and MBS. Annaly, as I mentioned before, is a mortgage REIT. Mortgage REITs can be further divided into agency mortgage REITs, which invest in really just agency backed MBS and non-agency mortgage REITs, which invest in a broad variety of mortgage related assets that are not backed by the federal agencies. So for instance, Fannie and Freddie, and while Annaly is primarily an agency mortgage REIT, I mentioned before, we've got 93% of our total assets in agency MBS, our platform is differentiated based on the credit businesses that complement our core strategy and of note, we are the only REIT with a corporate credit investment arm. So, we have capabilities to invest across the capital structure in each of these, which means that not only do we own MBS and mortgages, but we also own income producing real estate assets. We have around about 180 employees. And as an executive officer of the firm, I have a broad set of duties. though as CFO, I have primary responsibility in communicating performance results to our stakeholders, managing our financial and budgeting processes and also oversight of our treasury and IT functions, but in all aspects, to be honest, I collaborate closely with the investment side of the house, as well as ESG, Strategy, and Risk. Adam: (03:41) I think that's a wonderful overview. So let's turn to our primary topic of today, which is ESG nAnaly just released its first ESG report. Let's set the stage by saying stating what is ESG, what does it mean to you and your company, and then how does ESG factor into running a business? Serena: (03:58) Yeah, so ESG and it is a nomenclature that's a bit out in the ether these days, but what it really means is environmental, social, and governance, and it refers to the three central factors in measuring the sustainability and societal impact of an investment in a company or a business. I know that's very definitive. I pulled it off, Investopedia or something, Adam, I think.. but historically many companies have focused on the G the governance aspect of ESG and less on the E and the S. That's not a new focus for us. I think we've been ahead of the curve in incorporating ESG into our business processes and culture from the start. For example, we are a female founded, company founded by Wellington Denahan, who remains a Vice Chair on our Board. And so diversity has always been a cornerstone of our company. And as you mentioned, Adam, actually on the 23rd anniversary of our IPO, we published our inaugural Corporate Responsibility Report. This provides significant disclosures about our ESG considerations that we've been incorporating implicitly and explicitly into our business for years. It's covered through five main areas; corporate governance, human capital and management, responsible investments, risk management, and the environment. Altogether, we aim to have a positive impact in the communities where we live, work, and invest. A couple of examples here, Adam, just to highlight that in 2019 we reduced our greenhouse gas emissions by 5% and we actually expect to improve that year over year in 2020. We have a social impact joint venture through which we have financed 21 community development projects and underserved communities across the country. Examples of these are things like, elder care residences and affordable housing. As of the third quarter of 2020, we have made $285 million direct investments to support community development and economic opportunity. So we, we find that, I would say that our corporate responsibility report is a great summation of all the work that we've done, but it is something that we've been working on from an ESG front really from inception of the organization. Adam: (06:23) I think that's amazing all the things that you're, you're doing from a, from that perspective. I think one of the challenging, challenging question that many businesses are thinking about these days is how do you balance the principles of ESG with return objectives with, to which remain a key priority, not only for your shareholders, but also for your employees and other stakeholders. And then how do you answer this question and what experience do you have as the CFO implementing this agenda and balancing these various strategies? Serena: (06:53) Yeah, it's a great question, Adam. And I think, the word balancing implies and either, or, and, and we don't actually view it as an either, or to be honest. We, we firmly believe that strong ESG principles are aligned with return objectives. And if you just consider a couple of basic ways that it could affect cashflow, all other things equal, you know, you do reduce your operating costs on several fronts. The risk management aspect and the governance aspect of ESG clearly mitigates regulatory and legal interventions. It's just really a great part of risk management. And we have found that it enhances employee productivity, development, and importantly, in this day and age, retention. So take the ongoing unprecedented stress test of our risk management preparation that we went through in 2020. We found that our extensive and sustained business continuity planning and infrastructure investments prepared us really well for this prolonged COVID 19 remote work environment. And had we not had that planning, you know, it would have been a much different situation, I think, and as a result, our trading teams were able to navigate the market volatility earlier this year, extraordinarily well with our support functions in lockstep. But as CFO and as a leader in general, I think it's important to recognize that change begets change. And the smartest course of action is, is to not try to swim upstream or, you know, as I say, in a lot of instances to my people, we don't need to boil the ocean here, right? We have incorporated SASB and GRI disclosures in our inaugural corporate responsibility report. And in taking a first pass at some of these indices and what they ask for, you could have included a lot of information. But the question really is what is material? What is a material piece of information that would provide value to our stakeholders? And we did this, we did these disclosures to provide high quality sustainability information of interest to our shareholders based on that we'd obtained during an outreach initiative. But it is important to be able to distill this material, ESG areas of focus for our company, as well as the industry standards, regulatory bodies and other member organizations that are evaluating disclosures are requiring today. So like I said, there's so much out there that you could do, but don't try to boil the ocean, take a really critical look at it and think about what is material because every day there's more things that are coming out there, requiring and showing that ESG is reporting is becoming expected. For instance, the SEC just recently, issued some rules requiring new human capital management disclosures.  The ILPA, The Organization for Limited Partners. They require limited partners now to participate in a set of action plans. The Investment Company Institute,  and NASDAQ, just to name a few, these are the types of organizations that are putting things out there that they expect their members to, to comply with. So there's a lot of information, and an example of an ever-changing  ESG world. The Federal Reserve announced recently as well, that they plan to join the Network for Greening the Financial System. And this is an important item to highlight because this is the first federal agency to join the group. So I really think as, as a CFO, you need to take a look at all the things that are out there and critically think about what is material, what is useful, and again, like I said, don't try to be all things to all people. Don't try to boil the ocean, focus on what's important. Adam: (10:24) What additional responsibilities do you have as a CFO in regards to ESG? How do you truly influence all three of those letters? And then, how does your finance and accounting team follow your lead in the midst of all that? Serena: (10:37) Adam, as a leader of the firm, I try to obviously lead by example, with regards to each of those letters, right? From environmental, social and governance. But as the CFO, I'm an, I'm a numbers person.  I'm in charge of the numbers and the process to generate them. And so one aspect of this is evaluating the various indices and ratings and determining which frameworks and measurements are helpful to present our story, to tell our story and what we are doing from an ESG perspective. So what we have found is that some ESG ratings tend to measure companies against industry specific standards. And sometimes that's, that's difficult, right? Because it's trying to put, like, in some instances, a square peg in a round hole, it doesn't fit perfectly. And we try to engage with these rating agencies where we believe that they've classified us incorrectly. So for instance, because we're a REIT we're often grouped in with the equity REITs, and we really don't have the same ESG risks or processes as an equity REIT. A true equity REIT, you know, for example, who owns a significant portion of, hard real estate assets. They've obviously got a lot to focus on with regards to the true environmental aspect of it, Adam, you know. Light bulbs, energy, efficient, light bulbs, and other types of sensors and things like that for us as a financial services related organization, that's less relevant to us though, obviously in, we incorporate those types of measures in our own office use, and so it's important that we make sure that we engage with, these, rating agencies and other types of organizations to make sure that we are appropriately classified. We have found that financial reporting and credit ratings provide a good point of reference though, for what to aim for. So it gives you a bit of a kind of a bar, I suppose, to try to look for and the benefits that it can be resulted in. For instance, you know, again, with the more related to the equity REIT side of things, LEED certification standards and things like that. Between the financial reporting, the indices and the ratings, we're utilizing all of this information to better inform our, our processes and policies and what have you, but also how do we use, what do we expect of our vendors, Adam? So looking outwards, what do we expect of those  who work for us. As our investors expected, ESG responsibility from us, we're trying to figure out what should we expect from our vendors. And, in turn, what this should do is contribute to systemic change that better enhances practices across industry. So we're all moving together in the same direction. And broadly speaking, we think this is indicative of a new era of ESG responsibility. As CFO though, I recognize that this is a journey. I just mentioned before five or six different, regulatory bodies and other types of organizations that have come out recently with, new expectations and standards with regards to ESG. So it is a recurring exercise to raise our standards and challenge ourselves. And it's also helpful to see how others are doing this as well. And then with regards to my team, and from a leadership perspective, I guide my team in uncovering all the facts, recognizing parallels, overlaps, and contradictions, and marrying our shareholders' interests with the industry standards. So what really does make sense for us as an organization? And what I have found is that it really ends up being a synergistic outcome. And I've been also very, very impressed at him with the entrepreneurship of my team. So I would say that given the quickly evolving nature of the space, it's been an extra ordinary time to see how employees' entrepreneurship amongst my team has evolved as they explore how best to navigate this iterative process. And, and I'm always impressed with the new ideas that are brought to me from my team. Adam: (14:34) I think, a great way to round out this conversation would be to kind of focus a little bit on COVID-19.You've mentioned it a little bit, but how do you see COVID-19 impacting the ESG discussion and its future trajectory? Serena: (14:46) Yeah, it's interesting, right? Cause we, it feels like we're still well in the thick of it, Adam, but I think it will undoubtedly have a long lasting impact. And there's obviously a lot of discussion in the marketplace as to what it means for the work environment for the use of real estate and other types of aspects. But I think it will put a premium on reporting. I think the learning curve on ESG priorities has been vertical for so many years. And so with education comes expectations, and I think that there are just higher expectations these days as to the level of reporting and what should be reported by organizations, on the health and wellness of your employees and human capital and these things that I said, you know, that the SEC is expecting as well. I don't think you can look past risk management to be honest. I think if you reflect, on what companies went through after 9/11 with regards to the business continuity planning that they did, you know, after such an event, I think that, we will see an increased focus on risk management, subsequent to this period, that will be here to stay just like that business continuity planning has been here to stay since 9/11. And I also think that there's going to be a focus on companies being responsible investors and a focus on human capital, like I mentioned before. I think COVID-19, and the, and the murder of George Floyd among other things exposed significant inequalities in the U S and across the globe even. And so these social movements have resulted in, and permeated across class, culture, industry age, and so I think it will affect how and what companies and financial firms decide to invest in going forward because stakeholders will expect it. And when I say stakeholders, I mean, our employees, as well. Our employees do expect us to have a stance and a position on these things. However, I think, you know, I've heard people to use another catch phrase, I guess, Adam, like don't boil the ocean. I think, you know, embracing ESG needs to be a movement, not a moment, and, it is becoming part of our DNA as a society. And I think that it's something that all financial professionals should, should continue to be focused on. Closing: (17:23) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession, if you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imnet.org.

FULL EPISODE TRANSCRIPT:Adam: (00:00) Welcome back to Count Me In IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson and today I have another bonus episode for you. This special conversation features my co-host, Rouba Zeidan and Alia Moubayed, an experienced economist, General Manager, and Global CFO. In this episode that discussed the impact of the COVID-19 pandemic and Alia shares her perspective on how the world has changed because of it. She also shares how finance and accounting profession can better arm itself for the next chapter of business. Stay tuned as we begin listening to their conversation now. Rouba: (00:47) Good afternoon, Adia, and thank you so much for joining me for this episode. I'm really looking forward to getting your input. You are one of the top economists in this region, and your view on the current situation and going forward, you know, as we begin, 2021 is of great importance, and so thank you. Alia: (01:07) Thank you very much for hosting me. Rouba: (01:09) How has the pandemic changed your role as an economist? Alia: (01:15) Well, I mean, the, pandemic changed the way we do our work as economists, particularly in the middle East and North Africa region at two levels. The first is, our own understanding of the economies in the light of the COVID. It requires from economists a non-traditional approach to analyzing the impact of the pandemic. So fundamentally it is hitting, people's health and therefore a key resource. So fundamentally the pandemic is affecting our work as economists at two levels. First in our approach in, analyzing, the developments in the economy, notably, understanding the impact of the pandemic, both at the macro, but also more importantly at the micro level, because, particularly that, that the pandemic is hitting, the lives and livelihoods of people, but also supply chains and therefore industries, and at the same time global economic factors like oil, and, capital flows, and trade. So our understanding of, and our approach to analyzing, economic development has been transformed. But I think also the second level is, how go about doing our work. The East and North Africa region, is a region that you cannot analyze by staying behind your desk and looking at numbers, first, because, there's less data transparency in the region, and our work as economists requires us being, in the country, traveling, talking to policymakers and to decision makers in both the public and the private sector. And obviously our, ability to travel has been challenged by the pandemic and that significantly impacted our work, but thanks to digital technology. We have, moved our work and our connectivity with people in the region, to all these platforms, Zoom and others, and they have also transformed the way we interact with decision makers in the region. Rouba: (03:52) Every quarter IMA and ACCA collaborate and we publish an economic conditions report, which details global developments, and in the most recent global economic conditions survey, which covered Q4 2020 and the middle East region recorded a huge jump in confidence. In your view, what is driving this kind of progress? Is it the easing of geopolitical tensions? is it the continued recovery in oil prices and demand? I mean, when you look at oil prices, they've jumped around 25% to $50 per barrel between September and December.,and also, what are the challenges that remain ahead for the region? Alia: (04:34) Sure, I think all the factors that you have listed have been important in shoring up, sentiment in the region, and I think, the four are essentially, first one is a sign that we have seen in Q4 that there are signs that the vaccine is at a reach and that a rollout is imminent. So that has, given hope of the resumption of economic activity, particularly in the hard hit sector, service sector, which constitute a large part of the services economy in the region, but also globally. I think certainty from that sort of, this, expectation that a, economic rebound is slowly on their way has transpired into the demand for oil, even though there are still pressures and uncertainty on the outlook for demand for oil as has been estimated recently by the IMF, but also by the International Energy Agency, however, I think the response from, all exporters, particularly in the context of the OPEC plus meeting to, to curb and continue to curb supply, has also helped, bring oil prices, to levels that, that affects sentiment in the region, I E 50 plus, level. And I think as long as, as oil prices remain in that, in that bound, the pressure, particularly on the, fiscal, and external, wind oil windfalls to the region, will be much less than what we have seen in 2020. And that takes me to the third factor, which is really, in Q4. We have seen, most with Eastern country countries, particularly in the gulf put out budgets for 2021, that confirmed their commitment to supporting, their local economies whether in Saudi Arabia or in the UAE, in Qatar. These are budgets that have maintained, some form of minimum fiscal stimulus, but also there have been a rollout of many of the liquidity packages that have been provided by the central banks or, delaying, the periods of, further exemptions from paying taxes and fees. So alleviating the pressure on, on businesses across the economies. So the kind of fiscal and policy framework, that has been maintained for 2021 also has contributed to the sentiment. And, finally I think, what we have seen is also the reduction in geopolitical tension on the back of the U S election, and this is a perception, at least so far, that, a diplomacy and not confrontation, will be the theme, when it comes to, to dealing with the, many, complicated, tensions, that has marked the region for a long time. Rouba: (08:19) Undoubtedly, the global economy is in a very fragile state at. Its worst state since 1930. COVID infection rates are increasing, was the virus continues to mutate. And what lies ahead will definitely include further lockdowns, compromise, consumer trust, and respect of spending a lot of strain on cashflow and rising, private, and public debt that to name, but a few, but the progress made on vaccine approval. And what is being dubbed the most ambitious global vaccination campaigns humanity has ever seen. It kind of raises hopes for a permanent economic improvement. How do you see its successful implementation impacting the regional and the global economy? And can we hope for an economic bounce back? Alia: (09:09) I think, bounce back is a bit, too optimistic. I mean, there certainly there are based effects we quote because we are going to go to go from a deep recession, as you rightly said, I mean, let's, let's just put some numbers here. I mean, the word economy and the world output, is estimated to have been, to have contracted by, by 4.4%, in 2020, with advanced economies  contracting by around 5.8% while emerging markets, by, a 3.3%. These are by far, a very deep recession, and obviously they will leave deep scars in, in many of the economies, therefore, why there will be a rebound from this recession, however, there is a great uncertainty first on the, extent and strengths of this, of this recovery, but also on its durability, because, first we are, we are seeing, unfortunately second waves of hitting in many countries leading to second waves of severe lockdown, particularly in Europe, and in some emerging economies, but also, the rollout of the vaccine will be a long drawn, and it will take time. It needs resources, it needs the right infrastructure. That's why maybe in the developed world, they will be able to, they are relatively well prepared, although, I mean, not all of, all of them, but in much greater part of the emerging world, that will take a long time. So, so, so the, the strengths and the, speed of the recovery, is, is extremely uncertain. I think, this is important because the recovery will need to rely on the resumption of trade and travel and, and the, and the renewed momentum in the service sector, which has been the most battered, by the city session, unlike previous recessions that hit the financial sector only, or, this time it's really core service sector and trade and, and travel, that will take time to resume. And that is particularly important for our region, which relies on the sectors quite importantly, and as I mentioned, the deep scars are, are not only on the economic level, but they are also on the social level. A recent research, particularly done by the IMF and the World Bank actually shows that the pandemic, will deepen and aggravate significantly inequalities within society because of record level of unemployment, and, difficulty in access to basic services of large swaths of the population. In particular, the scars will be left on, populations that have a large segment of youth and women, which also again, here in the Mid East region is region countries like Egypt, like Morocco, will be significantly impacted. And therefore this is why as policymakers and as economists, we, we have been saying that it's extremely important to maintain, the policy support, the liquidity,  the support to SMEs that, that are needed to absorb the impact on these fragile and vulnerable, population. And these are the kinds of challenges when you asked me about the challenges and the previous question, I think, our problem in the region, is that, whether oil exporting countries, remain, will remain, vulnerable to the volatility in oil prices, even though they have been making tremendous effort to transform the economies while in the oil importers, the, the deep scars left, will be challenged by, high levels of debt relatively constrained the fiscal resources and therefore the need, to continue to engage with international development partners to provide the finance that is needed to, limit, the impact of the crisis, and also help a more durable and speedy recovery. Rouba: (14:01) Over recent years. The Gulf region, Saudi, and UAE in particular have made great strides to migrate away from oil reliant economies, and though we've seen a number of national strategies that have been put in place to kind of formulate the next chapter. COVID-19 limited even halted progress on so many levels, but how has the COVID-19 pandemic affected those plans and how challenging is it really for governments to be balancing, you know, this balancing act between short and long-term goals, do you think? Alia: (14:35) Absolutely. I think, as we started, the pandemic has, has forced every country given sort of its level of serious, serious impact on the way it affected the lives and livelihoods of people and, hit fundamental sectors in the economy challenged the public finances of government, will imply a serious, rethink of, sort of the strategic direction of economic policy, in many countries, but more particularly in oil exporting countries. And I think this is what is happening, particularly in both Saudi and the UAE. Maybe the UAE is already rolling out this transformation towards, more, digital, based, economy, the focus on the high value added, health-related and health boosting, kind of sectors through telemedicines, investing in food security, related supply chains. I think the pandemic will bring the fundamental changes to the policy process, the economic policy process in Gulf countries.  As they assess and evaluate and absorb, the impact, the scale of the impact of the pandemic and its strategic implications, for that pursued economic paradigms and models that as you mentioned, have been embedded in that visions 2030 and 2040. Now obviously, the, the UAE has, has been going on in this direction of, adaptation and, and change and has seen a greater agility in adapting its policy, to these, to these changes. Saudi Arabia is on the way, but I guess as we, as we think about these changes, I think we need to understand them at two levels. The first one is that these changes are imperative because the shock of the pandemic has, has shown that there is a need to allocate a scarce resources, much more strategically in where you could get the bigger impact on the economy. And already these economies with lower oil prices are facing funding constraints, and therefore there is a need to review some of these strategies to align them to these new, levels of, funding and, and resource, availability and constraints that the pandemic has, has put forward. But the second and most important is really the change. The fundamental changes that it will bring to the, to the, to the paradigm, and, of economic transformation that has been set in those visions. Most of the visions, particularly Saudi division, 2030 has put a lot of onus on the service sector on, expanding it, particularly, travel tourism, sector as a major drive for employment. Now obviously, as it would need to be revisited, to be adjusted, that it will affect investments in these sectors. But I think more importantly is that it will accelerate what is in these vision in terms of embracing a digital economy faster than what has been planned. I think, investments and expansion of health, related, sectors and upgrading them faster will take priority over other sectors. But I think more importantly, moving towards sustainable and green sectors and growth, models, will be increasingly a priority, in those countries. These have been at the core of these strategies, but I think now they will be further emphasized. Rouba: (19:06) The tourism industry was noted to be hit the most. I mean, we're talking about $1 trillion in losses and over 100 million jobs that risk of being lost. One industry amongst many others have been hit. How can finance and accounting professionals become indispensable to their employers at this very critical time in history when furloughs and job loss are a daily outcome for, for so many people around the region and the world? Alia: (19:35) Well, I think it's, it's extremely important. I mean, that, that all jobs adapt to this changing environment and the finance and accounting professionals are under of course, a lot of pressure to, to, to understand, how the pandemic and the economic and the changes in economic landscape, is, is impacting, the operating environment of their businesses. So, the main challenge for them is really, building the knowledge and the capacity to quickly absorb and understand, the, the way, the pandemic, if, the pandemic is impacting, the businesses at, at the various level. So there is a part that is related to the personal knowledge because we need to know to preserve our health, but also other professional knowledge that is needed to understand, how, how this pandemic is affecting the businesses and its finances, and to, and therefore to build the strategies to limit the, the financial impact of the pandemic on their employers. Secondof course is that much of the finance and accounting, profession, will also become increasingly, if I may say, transformed by the wave of digitization and, and, and I think, facing up to this challenge will be, will be, will be critical, for anybody working in this, in this, in this field. Rouba: (21:34) Climate change is becoming a more prominent point of discussion in boardrooms the world over. The associated financial risks pose threats to, I mean, not only on a regionals, level, but also on a global economic scale. According to the UN, delays in tackling this issue could cost companies nearly $1.2 trillion over the next 15 years. This is making it critical for companies to take the impact of climate change into consideration when planning their strategies and operations and the process, which also requires a lot of transparency and disclosure of related risks. So when we look at globally, a review of over 1000 companies showed that that yes, many of them are engaging in this whole disclosure process, and this number is actually increasing, it's increased to nearly 15% over just the last two years, but how do the public and private sector, in the middle East region fair in terms of taking such consideration to account, to mitigate the risks, climate change present or not? Alia: (22:45) Well, I think, I mean, climate change is, is a major challenge that we'll face the region at the macro level. And it particularly in the, , in the Gulf countries. And I think now that we have seen, yesterday President Biden, his first, one of the first orders, to embrace back the Paris agreement for climate change, that means, essentially that we are on for fundamental changes in the global, again, a policy framework and an acceleration of the climate change agenda globally, on all fronts. And one of them obviously, is, as you mentioned the ability of companies, to, properly assess, the risk of climate change on their businesses, property costs the risk that transpired to them, and integrated into their, strategies and financial planning. And I think, Middle Eastern companies, have a long way to go, on that, particularly, maybe, maybe less so in, in some of the private sector, companies, although this is a, we are still relatively behind, but I think more so because the region is very much, driven also by, state owned or state linked companies, the state owned sector is, is, is, is first lacks the broader, transparency and relatively solid corporate governance rules, let alone, estimating and incorporating, the, necessity, the climate change related accounting and finance and the and risk assessments that, that these new, policy changes, will imply. Rouba: (25:07) We have been hearing a lot of speculation on the role of cash in today's world, as some analysts and finance professionals have made statements such as cash is no longer King, but liquidity is. So what is your view on this? Alia: (25:22) Now, obviously this is a very important saying we are living in a world of, where global, global liquidity, is example given the accommodating stance of, global central banks, at the level of their monetary policy, historically, prolonged period of low interest rates that will be with us, and in some countries, negative interest rates. So cash is, it's certainly not the right option, to, or position to, to hold on to, but rather, finding, means to, employ the liquidity in, revenue in higher yielding, assets or revenue generating, ventures, whether, in the bond or equity markets or, or even in, in investments, in productive sectors. So, so obviously the global, set up, where, the challenge now is to get the global economy, out of it's a deep recession and demand that, the scars, which the pandemic has left will, will mean that, global, monetary policy of, major central banks will remain, accommodating and interest rates historically low. And this will mean that in the short term, at least, cash is not, is not king. Rouba: (27:14) I appreciate your input Alia that was quite insightful, and you truly lived up to your evolving economist role in the region. Thank you so much for joining us, and I look forward to further discussions with you in the future. Alia: (27:28) Thank you very much, Rouba. Thank you. Closing: (27:32) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Mitch Perry: https://www.linkedin.com/in/mitch-perry-6111b61/FULL EPISODE TRANSCRIPT:Mitch: (00:00)Thanks for coming back and listening to another episode of Count Me In, I'm your host Mitch Roshong, and this is the 110th episode of IMA's podcast series. Today you will hear from Mitch Perry, CFO for Blue Cross Blue Shield of North Carolina. Mitch is an experienced executive with a demonstrated history of leading effectively across multiple industries, including healthcare, energy, and insurance. In this episode, he talks about business transformation in the context of accounting and finance. Keep listening to hear about some keys, best practices and strategies, for overcoming challenges associated with business transformation.  Adam: (00:47)Mitch, what is the current nature of business transformations and what do businesses hope to accomplish by going through a business transformation?  Mitch P.: (00:56)Yeah. Well, thanks, Adam,  for that question, it's, it was really timely. For us, we're seeing, you know, a lot of change in healthcare and trying to lead transformation in healthcare, you know, it's at its most basic form, I look at it as a need to be responsive to really what's going on in the marketplace, how rapidly business conditions are changing. What you need to do to, as a company is not only to stay current, but hopefully stay in, stay in the lead. I think about healthcare, maybe even business in general, what we're living through right now with COVID-19, has really underscored, how, how important it is to be ready, to adapt and change and transform to the external market. And what we've seen, to some extent, even gives a little bit of an opportunity to accelerate some of that transformation. I view us as an industry that is transforming right before our eyes, and I see us as Blue Cross, North Carolina as playing a role on helping to transform leading the transformation of health healthcare for the better, in our state. And the way we look at it is largely from an affordability lens that, we got to drive transform ourselves and help transform the system in a way that, is, provides for more affordable healthcare for our customers, and a major way we're doing that is through how we transform our, our payment approach with our provider partners, and you're paying them for, quality and outcomes as opposed to a fee for service. And even though we're a leader, maybe especially because we're a leader, you know, we're doing it from a position of strength, we're making certain that we're focusing on, what we should be doing for the long-term,and it kind of allows us to play offense as opposed to maybe having to react and try to transform from a position of defense later r. You know, the final point I would make on, on this question, Adam is, we have, had really strong momentum with our provider partners and transforming, the payment system before the pandemic, and it really, because of that has allowed us to maintain momentum and even accelerated, some things that weren't initially on the roadmap is, have now allowed us to even go faster. So think in terms of how we're able to add telehealth, into what we're, in, into what we're really, completing as part of our transformation, structure, and then, you know, how we're working and bringing our primary care along as well. So it really, put us in a position to not only be strong coming into it, but to maybe even go faster through it.  Adam: (04:13)So I think you've given us some great examples of how you've been able to have a successful transformation. What are some of the keys that you've been able to apply to make it a successful transformation?  Mitch P.: (04:23)Yeah, and Adam, I will acknowledge, that, you know, we are, in the middle of this and maybe all businesses are at some stage in the middle of transformation, but, you know, the good news is I think I've got some really timely, feedback, but there's also the reality that we learn and learning every day. You know, one of the things I think about is, innovation is important. I think sometimes when you talk about transformation, people think about innovation and clearly there is an aspect of that, but I think about it as, as being more than about innovation, I think about it as execution the really the most critical part. I don't know if you've had exposure to John Doerr, a very successful investor with Kleiner Perkins. He was late investor, Google, Amazon recently, Door Dash, and, I've heard him say before, that ideas are easy execution is everything. And it really hits home for me that, yeah, it's, it's great to have all these great ideas, but there are a lot of great ideas, you know, really the key to success is can you execute on those ideas? And so with that, you know, I've done a little thinking around what are some successful events and, you know, almost think about it like a little bit of a recipe. This recipe happens to have six items. I will say I'm a pretty simplistic baker. Six items is quite, quite a bit, but transformation has some complexity to it, and I think six probably makes sense and they all happen to begin with the letter C. So hopefully they're easy to remember, but not the six c's. The first one is courage. I think it takes courage to make changes to the status quo. You have to have energy to continue to be curious. You have to find ways to take measured risks so that you move forward without putting too much of your existing model at risk. The second is, communication. You know, I'd say it starts at the executive level, but it has to go all the way through the organization. Being clear about what you're driving towards, you know, what we're trying to achieve, why it's better, you know, why, you know, not just trying to make a change for change sake, but why it makes sense for what we're doing. The third is collaboration, and I think what we're doing with our provider partners provides, or will a good example of that. transformation requires partnerships. I don't think there's really any way to do it effectively unless you deal with partnerships, whether they be internal partnerships or external. And I think it's important that you invest the time is early. She can, and your transformation process there to build those partnerships so that you can get some early wins and you can withstand the challenges later, and where in, you're able to pick up momentum as you, as you move. The fourth, is change management and, you know, I think about change management as being  almost a process to itself. You have to be purposeful. We all understand that, as an organization and as individuals, we embrace change differently. We have different risk tolerances, but important, that you're able to, bring everyone along. And there's no way to do that, I think, but to be purposeful around kind of how you, how you work through the organization and when you're doing it outside the organization, how you work outside the organization to make certain, everyone has a common understanding. The fifth, and this one may become a little more obvious given the, for the fact that the four score probably has some complexity to them, but it is commitment. I'd like to say that you have to be patient, but you also have to be persistent. You can't change momentum overnight. There will be setbacks. There will be opportunities for people to say this doesn't work, but you have to make certain that you've got the commitment and fortitude to continue to move forward even during the challenges. And the final one, which I really think underpins them all is culture. And, you know, the culture of blue cross North Carolina is going to be different say than the culture of a technology company, or you know, or any other type of company. And any of those companies are, can go through transformation successfully, but you have to understand the culture you have and make certain that you're being purposeful around kind of how that culture supports the transformation. What are your norms? What are your tasks will change? you know, it's just going to have to be a structured that company. You can't be something that you're not, but it is important that the transformation as the transformation journey occurs, I think the culture continues to evolve so that the culture continues to become even more innovative and push the boundaries of our mission. So those are the six things, hopefully those are, uh, a little bit help them a little bit. None of them.  Adam: (09:56)Yeah, I think they definitely are. And as I look at this next question, I just have to laugh to myself. you know, I was going to ask you, like, can you explain some best practices or setting up an initiating a business transformation? And I think a lot of people are being thrust into it because they were suddenly hit with a worldwide pandemic. So, you know, maybe you can share some of your best practices that you've had, you know, in the midst of COVID, you know, setting up and initiating a business transformation that was kind of, it was kind of thrust upon you.  Mitch P.: (10:23)Yeah, yeah, no, I think that's a, it's a great, next question, Adam, and, and I think that the pandemic is a good example, that if you were, you know, if you were trying to start it and react to it, you'd be coming from a position of dependence, and it would be really challenging. It was because of where we were coming from and the strength and momentum we have built that we were able to withstand some of the challenges we were able to respond to it. and again, we were able to accelerate it. If I build off of the 6 C’s, I've got a few things that, maybe tease out a little bit more as part of that, and you know, the first, and I've used this word before, but it's such an important word, purposeful. Be purposeful about what you're trying to do. It doesn't have to be a detailed picture of the desired end state, but at least the objective, you know, what are you really trying to work from? What are you really trying to work your organization to? Earlier in my career, I remember I heard someone say something and it was stuck with me. That activity doesn't necessarily equal results, and so just because you're moving doesn't mean that you're actually getting the results. So, so being purposeful about the change you're trying to create and not just trying to change, because you think that, Hey, I gotta say, I gotta, I have to get out of the status quo, the, second one, and this one, I was in the 6 C’s as well, but worth calling out executive commitment is essential. It's going to be challenging. There are going to be times when, we, there are rough patches and it's important that the executives buy in, the support, the executives or the leaders, and actually have a visible presence in, in why what we're transforming to, is really going to be meaningful for the company and be meaningful for our customers. Third, I would say, not talking about having a structure and I'm not talking about trying to have something that's big and bureaucratic, but making certain that recognize the transformation as an investment you're making in the business similar to any other investment and that you've got a structure to incubate it and support it and manage through it. I think sometimes, and I've been guilty of it in my own program to work on, you try to do things off the side of the desk, as opposed to a dedicated or structured way, and it doesn't go as quickly and it's rarely as effective.  Fourth,  and I've said be purposeful, have a roadmap, but I think you can't have a roadmap, and be rigid. You gotta understand that, yeah, I know where I'm trying to drive towards, but you know, there may be some potholes, maybe some things in the middle that I've got to move around, so you need to be flexible, have to continue to make sure you've got the appetite to innovate, innovate, redefined boundaries, you know, adjust as you go. And the final, maybe best practice that I would, I would point to is the underpinning I talked about the corporate, the corporate corporate culture. Don't, don't try to be something you're not, you know, do to what you're trying to get to them, but make certain that it fits within who you are in the norms. you have, you know, the organization has a certain, tolerance, for how it will manage change and how it will overcome obstacles, and it's important to the table and manage within that co-construction.  Adam: (14:17)So you touched on this a little bit, you know, on your fourth point that you just made about being flexible because not everything's going to go smoothly, as you all thought it would. So what are some challenges that people can expect or potential pitfalls to be aware of?  Mitch P.: (14:31)Yeah, I, you know, I think one of them, it goes back to the executive, goes back to change it from a leadership standpoint of resistance to change is definitely something, any change you have, whether it's a big transformation or whether something smaller, you're going to have situations where there's resistance change. I've heard it described as the antibodies of an organization trying to fight off organization and trying to kill it. So that's where I think the executive commitment that's where, you know, you got to make certain that you've got the right, buy-in, secondly, really closely tied into that, there are going to be setbacks, no doubt about it. You know, as we've gone through our provider partnership structure setbacks with how we how we get the data of the pandemic itself, to some extent as a setback, because in the early days, the providers were, were basically had their focus was, was changed and even their cash flows. We had to figure out how are we going to deal with those, set setbacks. So it's important that you got that commitment and then you got that, willingness to adapt and push through. You know, I think third is there will likely be some, reduced productivity at the time. You know, sometimes we all know it's easier to continue to do things the same way, some your term that improve and it can cause reluctance and it can cause additional costs and additional burden, and I think that's why it's important that you have a structured approach. We call it bubble funding here at the company, but whatever you have, some type of structure that builds in for the inefficiency that you'd likely to have, in the process. You know, the fourth is maybe tightly tied to that one to the third in it. I think about this a lot is, is our company CFO, every dollar we spend as an investment, is an investment in something, whether it's an investment in yournear term priorities or, or long-term problems. And when you've got things that you've got to get done near term, sometimes it's challenging to think about how you make investments in those transformation activities over the ong-term. And so it's purposeful that you treat it like an investment and that you're able to communicate, what's the tie to the strategy, you know, how do I think about it from a priority standpoint? And then the last one really kind of, I think, relates to almost all of these and that's that, communication is, is key. There will, you know, there'll be gaps, and it makes certainly being purposeful about the change, noticeable about the communication. I like to say it's a little bit of spreading the truth, you know, making certain that everyone understands, where we are and where we're trying to go, as we're pushing through some of the challenging times with a transformation. Adam: (17:41)It's almost like these things that you've just mentioned, these pitfalls, they can almost serve as, learning, learning opportunities to improve the, even more, you know, have you seen that happen?  Mitch P.: (17:53)Yeah, yeah, no doubt, and I think the organization, does learn, does learn as, learn as they go, in a box, I guess, back to that cultural art that I've, I've talked about, you gotta take it from where you are at the time, but continue to evolve, be flexible, you know, have a basic understanding where you need to go, but also know that, Hey, I can't work out every single item or, or every single potential outcome, because there'll be some things that will need to evolve, but be flexible, be purposeful, and then you'll be able to, to adapt as you go. And again, the pandemic is a great example of, for how we've done that. Tele-health wasn't even, I mean, telehealth was on the roadmap, but it wasn't really a focal point for us as part of our provider partnership efforts, but, we've been able to successfully shifted to where now it's a meaningful part. And so it's just being open and willing to be flexible to those learnings as they occur.  Adam: (19:03)I mean, with all that being said, how important is it to make sure proper governance and internal controls is in place prior to a business transformation and why?  Speaker 2: (19:14)Yeah, Adam, I think about governance two ways. The first way is I think about governance of the transformational effort itsel,. and you know, that one is, is definitely important, for all the reasons I think we've touched on here. You have a personal plan that you can execute again, execution is the key part. Making sur  you have, visibility across the enterprise, really treating it like as a major investment activity, that is. that is important at it, that it is, has a separate governance structure and discipline and governance structure. The second way I look at governance is you've got a governance structure now over your existing processes, and you're moving to a governance structure over your new processes of mean structure. and that's also important to think about, I think it's important to be purposeful in your switching to that new, a new approach. You don't want the inner inner state to be too long because, you know, create confusion, but you don't want it to move too quickly because then the organization isn't ready to move into the, into the new structure. You know, I do think it's important, to, be purposeful about when you roll out the new governance because, it might not, in fact it probably won't fit within the legacy processes, one of the things we say here is we're, you know, as part of the transformation, not only are we trying to train to disrupt, you know, the external market, we're trying to disrupt ourselves and change our processes as well. So you just have to make certain that you ready to move to that new process that  governance, then it's the process. Otherwise you're gonna end up with confusion, and probably some lost, productivity and this, and some loss of internal goodwill around kind of what's the best approach to move forward. So just timing is key.  Adam: (21:32)That makes sense. So, as we kind of wrap up our conversation, do you have any last thoughts on business transformation that you want to share?  Mitch P.: (21:39)Yeah, I don't know if I have any new thoughts, but I, you know, maybe if it's okay, if I summarize a couple of the, the things that I think are most critical here. You know, one thing I would encourage everyone to think about transformation, you know, be driven by the confidence that you can succeed, not the fear of failure. You know, transformation's going to occur. It's been occur in every industry. You know, we didn't want to be a leader in healthcare. It’s the healthcare industry is going to transform around us, but, you know, I think we're better. I think the healthcare should be better. We were leading it. So be driven by, the, you know, the competence of success. As part of that, thinking about it, transforming when you're strong, you know, not when you in a position of weakness or you feel like you have to transform. And you know, I think as, as part of that, you know, make certain that you're purposeful around kind of how you want to introduce the transformation, because again, transformation brings disruption in that you've got the right, focus on and you’ve got the right commitment. But I would also point out again to transform to, and for purpose, not just for activity, and, of course execution again, is the key here. Not that ideas and innovation aren't important, but execution is, is ultimately likely to be the driver of the success, and so maybe just as a reminder of the 6 C’s, courage, communication, collaboration, change management, commitment, and culture. But the final thing I will say, because we're living it, yes, it's hard. Yes, there are challenges, but I am completely confident that with the right focus, with the right leadership, with the flexibility to adapt that, that, that companies, that individuals can be successful in the transformative change and make really meaningful changes within their business and even in the industry moving forward. Adam: (24:00)Well, Mitch, I thank you so much for bringing your unique perspective, especially from the healthcare industry about business transformation, and thanks for sharing your insights with our audience today.  Mitch P.: (24:09)Thank you, Adam. It was a really a pleasure to be with you.  Closing: (24:15)This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website www.imanet.org.

Contact Alan Johnson: https://www.linkedin.com/in/alan-johnson-a96601a8/Contact Loreal Jiles: https://www.linkedin.com/in/loreal-jiles-804648a1/IMA's Diversity and Inclusion Commitment and Resources: https://www.imanet.org/about-ima/diversity-and-inclusionFULL EPISODE TRANSCRIPTMitch: (00:00) Welcome back to Count Me In. IMA’s podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong and today I am previewing another special bonus episode. You will hear from IFAC President, Alan Johnson, as he speaks with IMA's Loreal Jiles about diversity, equity and inclusion. In their conversation, to the two discuss what accountants can do to promote and support diverse, inclusive, and equitable workplaces, and ultimately do a better job as a profession to attract, retain, and promote diverse talent. Keep listening as we tune into their insightful dialogue now.   Loreal: (00:40) Hello everyone. I am Loreal Jiles and I am Director of Research for Digital Technology and Finance Transformation at the Institute of Management Accountants. Today, I am joined by an accomplished executive in the accounting and finance profession, Alan Johnson, who is currently President of IFAC, the International Federation of Accountants. Throughout his career spending about four decades. Alan has worked in Africa, Europe, and Latin America in a host of finance roles, including chief financial officer, chief audit executive, and several other board roles and executive roles. We joined today in discussion of the important topic of diversity equity and inclusion in the accounting profession. And for the purposes of this discussion, when we refer to the accounting profession or the accounting and finance profession, we are collectively speaking of the public accounting segment as may be familiar to those in the US those typically working in CPA firms and audit tax or advisory capacity, or the management accounting segment, accounting and finance professionals working within business or other organizations. And so for the last few months or so, the Institute of Management Accountants and the California society of CPAs to gather with global research partner IFAC, and a host of other research partners and contributors have just concluded a look into DE&I in our profession. We discussed, and focused on three aspects of diversity, race and ethnicity, gender and persons who identify as LGBTQIA. We began with the US and this is part of the larger multi-part series that will ultimately be global, and what we found in the US was the presence of something we've termed the diversity gap. Much greater diversity across the profession, but considerable under-representation of diverse talent among senior leadership levels. For every 10 of our professions, most senior leaders, eight of them are men., nine are white and few identify as LGBTQ. We surveyed over about 3000 US accounting professionals and found that diverse talent believes aren't advancing because of inequity and exclusion that still persists and it's diverse talent, unfortunately, is leaving companies, and in some instances, the profession because of a lack of D&I. So not like to invite you, Alan, if you could help us shed a bit of light when the importance of this topic, please tell us why is DE&I an issue that should matter to the accounting profession.   Alan: (03:24) So, good afternoon, everyone and good afternoon Loreal and thank you very much for inviting me to this podcast. First of all, I just to let your listeners know that, the accountancy profession is a profession. It's a global profession of 3 million professional accountants around the world, and we support businesses. We support, which are both large and small. We support the public sector and we support indeed many organizations across the world. And, you know, at the core of what we do, we act in the public interest. Therefore, we must operate clearly with integrity and we should operate to the highest standards of ethics in line with our professional code of ethics, which I hope you're all familiar with. I think we would all agree that decisions, the best decisions that are made are those that are rigorous on analysis, robust in debate, and that the decisions are made putting the public interest or the interest of all stakeholders ahead of the personal interests. And it's also, I hope we recognize that our profession clearly is a people-centered profession, that is people at the heart of organizations. So it is obvious that we need to ensure that we have a diverse, inclusive, profession that clearly respects everyone's views. And that is why it matters to our profession. It actually also matters to all other professions, but, you know, in our case, we are purely a people centered profession and therefore ethics, which ethics equality. And, and I would actually say that, diversity equality and inclusivity or inclusiveness is actually also, you could argue is an ethical issue. And as ethics is at the heart of what we do and how we operate it is of course, pretty obvious. I hope that DE&I is so important to our profession.   Loreal: (05:26) Absolutely. Thanks so much for that, Alan. If we shift gears a bit more building on the importance of this for our profession, what can, and should individual accountants do to promote and support diverse, inclusive, and equitable workplaces?   Alan: (05:45) Well, as I've said, you know, all professions should, in fact, all aspects of society should be promoting inclusivity, diversity and equity, that goes saying. But I would love to start by saying one thing, which pleased me, what, on Wednesday morning, when I read the press, the president Biden had signed for executive actions on Tuesday, aiming to increase racial equality across the nation. I was very pleased to read that, but on the other hand, I was also saddened that it needs a presidential executive action to address the issue of racial inequality. Honestly, in societies today, it should not need a presidential act of that kind, but if it needs it it's been done and I applaud your new president, and I hope that everybody takes note of the importance of this. But let's go back to our profession in terms of promoting D&I. First of all, I would say it starts with leadership. Leaders have to demand that their organizations embrace diversity, equality and inclusivity everywhere. But just by saying it doesn't mean it gets done. So it's about leading by example, our professional leaders need also to make appointments that reflect society, which means more diverse, more inclusive and more equitable. Cause these are the basic principles of humanity. They then need to hold their own teams accountable to ensure that they live up to those values. They need to set targets, they need to set objectives, and they need to measure that the organizations are moving in the right direction to achieve these. Personally. I'm not one that believes that you need to set quotas and things, or I didn't for many, many years, but I now realize based on what I see around the world, that unfortunately it's probably time to do so and to hold leaders to account for meeting those targets. That because they're not, arborous your targets they're targets, which mean that we reflect, as I said earlier, our society, because that's what we want to see around us. So it starts with the leadership, but it's not only about leaders as individuals. We must show tolerance for DE&I, but we should also show intolerance to behaviors that do not hold up, uphold those values. We should call them out. We should speak up. We should not accept it. And maybe what I heard you say Loreal is that people are leaving our profession. Sadly might be a reflection that they are speaking out. They are raising the issues, but they do not have the confidence that there'll be addressed and therefore they decide to leave. And I think that's very sad. It's very sad for the individuals. It's very sad for their organizations because they're losing access to talent, which will make the difference in terms of how they perform, and it's very sad for society at large, that people have to walk away, excuse me, walk away because they don't feel that they are valued as equals. So that's how I feel about this. It's got to be leaders, but it's got to be all of us, because it's so easy to say, let somebody else take care of it. We can't be passive bystanders in this discussion. We've got to be part of the discussion, and we've got to be part of the actions that need to be taken to address this. We are in the 21st century, and we should not be talking about this as an issue today. Sadly, it clearly is, but I believe we can do something about it.   Loreal: (09:57) Absolutely. Thank you. That, that came across so clearly in the research that we have been conducting for the past few months and what our respondents went so far as to say, which is in perfect alignment with your remarks, that it will take a village to make the amounts of improvement that's truly needed in DE&I, and in this instance, of course, particularly in the US but it's not a US specific problem. Of course, the entirety of the accounting ecosystem is viewed the professional accountancy bodies, the leaders, the academics practitioners. and so as we bear those things in mind, how can we ensure future accounts and see leaders? So the next generation of leaders with our profession and around the world, understand the importance of DE&I, how do we ensure that that message gets received?   Alan: (10:47) Okay, well, first of all, we need to talk about it. We need to be honest with ourselves. We need to confront the facts and the evidence, and then be committed to do something about it. So, you know, I am what I see from my perspective that increasingly this subject is on the agenda of the accountancy bodies around the world. And, you know, the sheer fact that IMA together with CaLCPA, how was your panel discussion on diversity, equity, and inclusion on, I think it was January 14th, if I'm not mistaken and you gave me the honor and the opportunity to speak at that event, and I appreciate that as my thank you for that. I think is a clear demonstration that this is important to our profession. I listened to some of the comments that were made, and I read clearly the results of your survey that you referred to. And I must say that I was alarmed initially at the results on the survey, because I didn't expect to see them. You are right. You mentioned that it's not just limited to the US and, and I've seen some, since I joined your panel, I was curious to know what, what it might look like elsewhere. and ACCA has done a similar, piece of research based on, covering 10 or 11,000 responses to their survey. And the statistics were slightly better than yours, but there were not significantly better than yours. So that kind of validates what you say, that it is not a US specific issue, it's a worldwide issue, and we need to address it, but I would congratulate you for conducting the survey, because if we don't know about it and we don't talk about it, we will definitely not do anything about it. So it it's good you've done it, and I, I'm confident that everyone listening to this podcast and everybody else will commit to take the necessary actions to make a difference. At the end of the day, we want to live in a society that we feel everybody is treated equally, whatever you look like, whatever your color, whatever your race, whatever your gender, whatever your sexual orientations are for me is irrelevant. We are all equal and we should be treated equally, and that's why I think it's important. Particularly they've said we are a people centered organization, and if we miss the opportunity of having access to the talent, that's out there, because we base our decisions on who you are, where you come from and what you looked like and what you do in your private life. We are missing out on a huge talent pool, which as a profession, we will pay the price of down the road. Plus of course, and I think it might, we might come back to talking about attraction and retention and all of that stuff. We will impact those important issues, so that's why it's important. That's why it accounting leaders must take the seriously. It must be a feature of their discussion with their leadership team. They must put in, you know, top reasonable targets to deliver the change, to make the change and to see the change.   Loreal: (14:20) Absolutely. One of the key things that came up when we asked respondents about solutions was having to implement metrics, fortunately, or unfortunately. The theme came across what gets measured gets done, and, and if there are supply chain issues, then the whole lot of the organization gets together to resolve the supply chain issue with urgency. And I think the more we further this conversation, then hopefully we're able to treat this issue similar urgency and affect the change that's needed. As you reflect on your career, you've had much more, I'd say international and global experience than most. would you mind sharing with us some of your personal experience, how have you seen DE&I impact workplace culture and business throughout your career?   Alan: (15:14) Yes, but I, you know, I'd been fortunate that I've had an international career and I've lived and worked in seven different countries across three different continents, and I've had the opportunity in the jobs I've had to travel extensively around the world. And I have, I'll just start off, you know, and reflect on that. One of the things that it is done for me, by having the ability and I, you know, I'm grateful to my employers in the past have given me the opportunity in the first place, is that it's made me understand the importance of diversity, because we can talk about it in the abstract sense, but it's only when you see what it does and how it impacts people and behaviors, and then how teams are formed and how they perform. Then you really, really understand that it's not just an abstract concept. It's a really real value to organizations and to society to have diversity. I had the opportunity early in my career, to work for an international company in, based in the UK, which, I joined it because I felt that it was an embraced all the values that I honestly, believed in at the time. And some of those values, enhanced even further. I joined it because I felt it was a company that took, diversity and equality seriously, and it needed to, because it was formed in 1888 and most of its operations, but outside the UK in, in the Philippines, in Africa and in Asia when it started, and then lastly in Latin America. So it dealt with diversity, real diversity issues on the ground light from 1888. So, you know, almost 130, 132, 133 years ago. So that's why I joined, but the reason why I stayed, because it wasn't just what I thought it was. It was actually what it was. and I had the opportunity, and as you look at me, I was a young black man in London, going about getting to the late seventies when I started working, in what was, you know, a difficult time in terms of, I can remember my, you know, my parents, a black father and a white mother, marrying in the fifties and living in the UK in the sixties, wasn't easy for them. I remember my grandmother telling me stories about what some of her friends told her when she informed them that her daughter, her only daughter was going to marry a black man in the fifties. It was quite painful for her to see friends that she'd known for, I don't know, 20, 30, 40 years maybe say those kinds of things, but that was what it was like. Now you can respond to this in two ways. You can either allow it to impact you and hate society because of that, or you can say, you know, what part of what I need to do is to show them that I'm not like that, that I don't hold grudges and I will have, I will show them that there is another way, and that was very much what I think my father tried to do. And that's very much what I tried to do. Of course, 20 odd years later, when I started working, things had moved on a little bit, not as much as I would have hoped, but I didn't have to suffer the racial abuse that my parents would have suffered in the, in the late fifties. So I've had great opportunities to work and live around the world, to learn other languages, to work with people with different cultures, and what it shows you is there are lots of great people around. They may not think like you, they may not look like you, they may not have had the opportunities you've had, but they have value, and your task is to help get the value that they have. And therefore I made it my task to always work in diverse teams, and I was very lucky. I remember, one of my, my first job at Unilever, the head of department was a lady and one evening I was late in the office and she asked to see me and I thought I had done something wrong. So I was a bit terrified, and I went into her office. Her name was Margaret and I went into her office, and so she said, sit down, so I sat down. She  said, there is something I've been meaning to say to you. I was deeply concerned about what she was going to say, beause I had only been in the job about nine months or so, and she said, you and I have something in common now I was thinking, what could that be? And she says, we're both minorities. I'm a woman in a man's world, and you're a black man in a white man's world. And you know, I'd never thought of it like that. I, you know, I hadn't seen her as, I mean, of course she was a woman, but I hadn't, I didn't describe my boss as  a woman. I said, Margaret is obviously as a woman, I never reflected nor did I actually think of myself as, and it's only when she said that I kind of looked around and realized, indeed I was the only black person on the team. Now, why do I say that? It didn't, it didn't in any way. I mean, I didn't face racial discrimination, obviously not because Unilever would never have tolerated that they wouldn't have employed me if I, if they, if that was their value system. But it just made me realize that these are real issues because she had been struggling with that fact herself, because I think she was the most senior female in Unilever, at least, no, probably not only in  the UK, in the world at the time, there were only two very senior females at that level in Unilever at the time, and she was one of them, and clearly she'd not been able to say what she said to me with anybody else. So that was great. The second thing is I, I was a few years later sent to work in Brazil, and I was nominated and I was delighted to go to Brazil. I'd heard about Brazil. I was soccer, crazy or futbol as you call it America crazy at the time. So you want to go to the country that which plays the most beautiful futbol or soccer. So, I just got excited, but I was young, I was single, so I thought, yeah, why not? But there was only one issue. The Unilever in London asked the chairman in Brazil. There might be one issue, and he said, what would that be? And he said, well, he's black. And he said, well, that's not an issue. Brazil is a multicultural, diverse country. And they said how many black managers do you have in Unilever, Brazil? None. So they, so I went there and I was the first at management level, and I think that was, it was great for me because it gave me an opportunity to see another culture, to love another language work with different people, multicultural. It really is, but I think it was probably the first sign that other parts of the Unilever world really understood what diversity was. And I mentioned about, you've got to see it to understand it, and I think my going there made them realize what it really meant. So, you know, fast forward, the rest as they say is history. That's my personal experience. I was very lucky. I worked for a wonderful company, that allowed me to see the world work with wonderful people, learn languages, respect, diversity, understand and  value in different cultures, and that's what drives me. and when I now look at, when I bring into myself to where I am today, in terms of, you know, being the president of the International Federation of Accountants, we have a very diverse board, 22, we should have 23, but we're currently 22 board members, 18 nationalities, multiple languages spoken, extremely diverse, Today, we have, 12 females, and 10. I think it is one female had to step down because of work commitments. But we were, we for the last three years, we've had a female, majority on the board, which is fantastic. We have many shades and colors on the board, which is fantastic, and I do believe the quality of the discussion and the quality of the decision is enhanced by that level of diversity. I can honestly say that I've been on the board now for just over five years, and this is certainly one of the most diverse boards I've worked on, and it's the most fun board I work on at the moment. I mean, I'm on other boards and they're fun too, but this is true diversity in all, in all of its definitions, and I would encourage every organization to look for that level of diversity. It's fun. It's a fun place to be, and you do much, you do much more and you do much better as a result.   Loreal: (25:20) No, that's outstanding. I appreciate the aspect of this. We often talk about the less comfortable components of diversity, but I think as we shift our focus more toward the value that diversity brings the value of, of being equitable and being inclusive and people bringing their whole selves to conversations and environments, then, then hopefully people become even more inspired to progress and, and enact change. And so I'll shift gears lastly, here into just this action-based focus. If we, if we could go there. How can the accountancy profession do a better job of attracting retaining and promoting diverse talent? What action needs to be taken?   Alan: (26:04) Well, the first thing I would say, and again, it's probably not specific to a profession, but, but it is certainly applicable to  our profession is that the first thing we need to do is people need to see that people like them are in leadership positions, and you know, you can't undervalue the importance of that. If you don't see yourself there, you don't, you don't want to go there. I mean, you know, it's just human nature. You want to be with, you want to see a reflection of yourself to work in a team in an organization. So back to, and I, sorry, I keep going on about people-centered profession, but if we want to have a successful profession, we need to attract the best, the brightest and people that don't think like us, because diversity is not just about color, race, religion, personal orientation, or whatever. It's more than that. It's diversity of views, diversity of experiences, and you're only going to make the best decisions when all of those come together. So that's why I think it's important that we, we, we, what we are seen as is a truly diverse, equal inclusive profession. That will be the first thing that will make us attractive. Now I must say, when I look at, the facts, around the world, we are a profession that is attracting great talent, diverse talent. I think the attraction piece is probably not done because it's never done, but I think we've, we know what to do now. I think the retention is the challenge because people will always join an organization and give it a chance and say, okay, it may not be perfect, but I can be part of making a change, and it won't happen unless people like me, not me personally, but you are there to make that change happen. So you're always going to give it a go. You're always going to say, okay, let me be part of the change I want to see about me, and I can't just talk about it from the outside, I need to be on the inside. So you, you do that. But if you get disillusioned by the fact that no change is happening, or there's no willingness to change, then what do you do? You leave? So, you know, it's back to leadership, getting people in, partly done, getting people to stay needs a lot of hard work. You've got to do the hard yards. It's not just saying it. As I said, saying is easy it is the doing that matters and being sincere, genuine on honest that you want to make a change. So, and retention is critical because we are a profession that is growing. We are a profession that is relevant to all aspects of society under the current world, in which we live, but particularly the epidemic world, what organizations need the talent, the knowledge, the expertise that we have to offer. So it is simply competent of us to make sure that we work hard on the retention. And then that of course is linked to promotions because you join for a reason. But if the purpose is no longer there, you don't stay. And it's not just about promoting people, because at the end of the day, people see through this. You can give people token promotions to make the statistics look good. And look this, you know, you have a picture of the board and it all looks merrily diverse, but if underlying that, it's not actually operating in a diverse way, then that's just a smoke screens, and people see through that very quickly. So I think the promotions need to be genuine. and they, they need to be impactful. now, as I said, I I've personally never experienced an issue of discrimination in the workplace, personally. Things have been said, which were not, right and offensive sometimes, but I put that down to, you know, they need some help themselves. And, therefore we should allow, we should accept that there will always be some residual resistance to this. Okay, but that should not prevent us from understanding that it's the right thing to do and pursue and persevere, to make the changes that, you know, that will make us a much more inclusive, diverse, and equitable society. So it is about leadership, but it's also about what we do individually. We need to have role models. I mentioned Margaret, she was a role model to me. She explained me what diversity, equality, inclusion meant. I never thought about those words, but what she did was just that I wouldn't have ever called it that because now I know what it means, and I've read your reports. I definitely know what it means, but that's what she was doing. She was a role model to me. She didn't say that at the time,. She didn't say, I want to be your role model. I didn't want to be your mentor. That's exactly what she was doing. So we need a lot more role models. We need a lot more formal mentoring to help people navigate through these difficulties because a diverse team, I've always said, this is a very difficult team to manage by definition, because you're going to get lots of different views thrown at you, and it takes longer to understand them, to take them into account and to put them together. It's much easier if everybody says, yes, I agree. Meeting's over, done. Well, you might think that, but it's not necessarily going to deliver the right outcome. So I've learned this, not the hard way I've learned this because I've, as I said earlier, I've been lucky that I always worked in, when I've been leading, managed and led diverse teams. I've made it a mission of mine that I have to make sure I have diversity around me. It makes me a better person, but it's not easy. It takes much more work to do and get right, but the rewards are rich. So I would encourage the profession to embrace it, to do the work and have the fun that comes from diversity, equality and inclusivity.  Loreal: (33:05) Thank you so much. Allen, I thank you for sharing your experiences and your insights on where we are today and really where the journey our profession is on to becoming more diverse, equitable, and inclusive. We encourage all members of the profession to play an active role in this journey. And we speak on behalf of both of our organizations to say that we intend to collaborate together, and to progress the state of DE&I within our profession. With that, we invite people to continue to listen more. This is the first in a series of discussions, we intend to continue the conversation until now.   Alan: (33:45) Thank you very much, everyone. Thank you, Loreal. Loreal :Thank you.   Closing: (33:51) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website www.imanet.org.

Contact Brian Suthoff: https://www.linkedin.com/in/suthoff/Visit Tally Street: https://tallystreet.com/ Get a Free Retention Report! https://tallystreet.com/retention/ FULL EPISODE TRANSCRIPTAdam: (00:05) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. Once again, this is your host Adam Larson, and I'm pleased to bring you another engaging episode of our series as Iintroduced to you episode 109, and our featured guest, Brian Suthoff. Brian is the CEO and Co-Founder of Tally Street, a company that helps small to mid-sized businesses keep and grow customers through actionable insights automatically generated from various sales data. In his conversation with Mitch, Brian discusses, how big data translates to great opportunities and explains why management accountants are best fit for driving this growth in these businesses. We'll hear more as we transition over to the rest of the episode now. Mitch: (00:52) So Brian, before we kick things off, why don't you tell me a little bit about yourself and give us some background on Tally Street and exactly what you do. Brian: (01:00) Yeah, great. Thanks, and thanks for having me. So Tally Street is focused on helping small and mid-sized businesses who want to grow and get paid, generate more value from the financial data or the accounting data that the businesses are already managing. The inspiration for Tally Street really came from a couple prior experiences of my own. Most of my background has been in big data and analytics, but then about four years ago, I started a liquor distributorship in Boston. Very traditional small business, just me and a couple other people. And, you know, we were successful in growing that business across Massachusetts, but very quickly ran to the point where we had, you know, a couple hundred customers and couldn't keep them all in our heads, and we're basically missing having access to the kinds of customer analytics and insights that I was used to having and more tech focused businesses. So as we looked at ways to try to solve that problem, what we found is that accounting and finance teams are really sitting on a wealth of customer data inside that accounting system. That's really being untapped in most small and mid-sized businesses. So that's really, our goal is to help managerial accountants generate the insights, the customer insights and information that large businesses have had for a long time, but to do that at kind of a scale and a cost that's appropriate for small businesses, so they can make better decisions and be more profitable and successful. Mitch: (02:32) So I know for us, you know, our accounting and finance listeners, our members, a big focus for us is using this data and making some kind of actionable insight, you know, something where we can make more strategic business decisions, but again, we're targeting accounting and finance professionals. Now you don't necessarily have that background in accounting. You come from the big data side of things. So, you know, how have you been able to kind of adapt with that target audience and then, you know, what kind of opportunities do you recognize with this diverse background? Brian: (03:04) Yeah, learned a lot over the last couple of years, as I've been speaking to more accountants and financial professionals and just catching up always on the industry and changes on the industry, and one thing I noticed in the recent issue of the Strategic Finance magazine is they had a great article on data visualization. And, you know, I think the reason that article is published is plenty of people have said, you know, everybody's an analyst these days, right? And roles are changing, and managerial accounts role is also changing from being mostly a record keeper or compliance cop to now also providing those insights and helping the businesses make better decisions. But the problem that a lot of these businesses have, and what I've seen is that they don't have the kind of the data lakes, the big data sets, the pristine sets of data that large enterprises tend to spend a lot of money managing, but they do have, or the best set of data they do have is their accounting system. And that's where we think that managerial accountants can, can really win, right. Is they're sitting on the best data set, that typically exists in most small and mid-sized businesses. So it's an area where they can start to apply those, analytic skills, presentation skills, using the data they already have, and they're already familiar with and generate a lot of additional value for the organization. If you just think about what's in that accounting system, the sales transactions, payment transactions, it has  what every customer bought the price they paid when they bought how often they purchased, how much money they've spent, just a wealth of information that can be shared across the organization and in a number of visualizations, but also putting it into other systems like CRMs that sales and marketing teams use. Mitch: (04:58) And then ultimately, what is the opportunity that would come out of this once they start tapping into this data? What are some of the examples or some of the outcomes that you've seen typically? Brian: (05:09) Yeah, great question. There are, there are examples across the entire organization. I tend to think of things, you know, they start with generating revenue, of course, but move on to managing costs, forecasting, customer behavior, forecasting, cashflow, understanding customer profitability, you know, just to take an example on the revenue side, again, that, you know, the accounting platform, whatever it is, has records of every sales transaction, which is connected to a customer and exactly what they bought and the kind of smart software that exists today, and what we're building at Tally Street can analyze all that data and start to group those customers based on, on those patterns, those buying patterns. So for example, you could look at customers who they've been around for a long time. They buy quite frequently and they spend a lot of money. So they have high lifetime value, which is a key metric that you often hear. Those are kind of your champions, and then on the other end of the spectrum you might have the ones who were just never a good fit to start with. maybe they only bought once. They didn't spend that much. They didn't, you know, obviously it didn't stick around that long if they only bought once. If you start to then understand work with the rest of the organization, once those groups are made of customers, you know, what are the common characteristics or profiles of the champions and how does that compare to the common characteristics or profiles of those kinds of poor fits or mismatches. And then that can really drive a much smarter sales strategy. We have a customer who, who did this and basically boosted their net revenue retention rates. So, you know, a measure of how they retain customers and the revenue from those customers over time from kind of the mid 80% range to 105% in 2020, which is really saying a lot given the crazy year that 2020 has been. Mitch: (07:02) That's very impressive. And, you know, especially as you said, recent times, you know, I just taking it a little bit further here to some of the analysis, you know, often requires, a lot of invoices and payment data, and you said that there's just so much information at the fingertips of accounting and finance professionals, you know, different platforms presented in different ways, but I'm sure there's gotta be a better way, to really organize and make sense of this data. Right. So, you know, in your opinion, what you work with your clients, or, you know, your personal preference, what is the most cost effective way to go about doing what you're talking about here today? Brian: (07:41) Yeah, there's, there's been a huge change across the industry in the last, five or 10 years and really accelerated this year that makes all of this possible in terms of analyzing the data and then presenting it. And that's really been the move to cloud-based accounting systems. So QuickBooks online, NetSuite are great examples, but when we move from having all the data in a, in a back office server and instead shifted to the cloud, it's now available and accessible to other tools really for the first time at a very affordable and cost effective way. As I said, this change has been going on for awhile, but it really accelerated this year and in 2020, and then combined with that software has gotten smarter and better. So artificial intelligence machine learning, have made it more cost effective to analyze these large data sets all the invoices and other information, and then to discover the insights inside them. Right? So the, this combination of, of changes really is providing accountants the tools they need to move up the value chain from doing that again, kind of compliance oriented work to discovering these insights and, presenting them and making them available throughout the organization. Mitch: (09:00) We're talking like everything obviously would just flow seamlessly and we're able to do all of this, and, you know, it makes it, obviously much more cost-effective businesses become profitable, but in order to get to that point, I'm sure there have to be challenges, you know, with so much data available and so much information, you know, how do you advise clients to make sense of everything? You know, what are some of the common challenges I guess, is what I'm getting at and how do you help them tackle those challenges and overcome it to reach this point of, you know, increased revenue and profitability and everything else? Brian: (09:38) Yeah, so there's a, you know, famous quote, what gets measured gets done. But it's not only measuring it, measuring something, but being able to communicate it and present it in a good way. And that goes back to the, you know, the magazine article we talked about at the beginning. But the first challenge is getting access to the data and being able to analyze it. That's helped and help solve by this move to cloud-based systems. Next, is being able to actually just crunch that massive volume of data, smart software helps that. And then third is really doing the presentations and, again, producing it or smart software can help organize it and get you a long way towards that goal. But then you can put it in other tools as well. So you can take the same information and, and move it into spreadsheets. You can move it into a CRM, you can make it available to other parts of the organization for presentation. And that really drives, you know, the first goal really is to help people ask the right questions. So then you know where to dig into more detail to find the right answers. Mitch: (10:48) So something you just mentioned was ultimately tackling these challenges, coming up with some kind of decision, some kind of insight and sharing with the rest of the organization. So how do you go about sharing this data across the organization? And, you know, going back to that article, I'm familiar with it, and we talk about how you need to understand that not everybody in the organization necessarily has a finance and accounting background and can interpret this data. Right, but the information that's in that data, the story behind it is so important. So, you know, how do you go about sharing that and telling that story so that it makes sense to everybody in the organization. Brian: (11:25) Yeah, as I, you know, again with my data analytics background or, you know, a lot of the accountants, love spreadsheets, love getting into the data, but not everybody else does, right? So, many people prefer charts, many people won't understand, an accounting system if they're given access to it. So a great way is to democratize the data. So democratize that analysis and get it to people in a way they can best consume it. For some executives that might be giving them a prebuilt report of the, you know, the slides, the charts, that they need to track on a regular basis for others in the organization like sales and marketing. They often, instead of living in the accounting system, they live in a CRM. So they spend all of their time in HubSpot or Salesforce, which is where they're managing customer interactions, upsells, cross sells, support issues. So we think a key opportunity is to basically take that those insights and information like customer lifetime value, churn risk, credit, risk, et cetera, that are produced from the accounting system and make it available in the CRM, which is where the rest of the, of the sales and marketing teams, especially in support teams will tend to access it. And it's really easy to get started. Tally Street connects to most cloud-based accounting systems in just a few seconds after the initial sales and customer data are gathered and analyzed, then connecting to a CRM like HubSpot or Salesforce takes just another few seconds, and then the information is there for you and your team to use, to make better decisions and create new visualizations within the platforms that everybody is already using. and those visualizations can really be con you know, created there. So maybe going back to that article one area where I might disagree with that a little bit is, you know, instead of using something like power BI or Tableau to create visualizations, use the tools that already exist, for example, the tools in the CRM, where people are already logging in accessing dashboards and accessing information, and you know, if you have any doubt that that's where things are going, you just have to look at Salesforce spending about $16 billion to acquire Tableau last year. Mitch: (13:48) So certainly a lot has changed this year, and it sounds like you are doing a great job at helping people take advantage of these changes for their businesses. you know, I always like to wrap up conversations by kind of taking a step back and then looking into the future. So now that we've kind of summarized what's going on, we look ahead, you know, 2021, what are some trends that maybe have started, or you think are going to start, at, for accounting professionals and what do they really need to know? What do our listeners need to know and make sure they take advantage of in the year to come? Brian: (14:19) I think a key thing to keep an eye on in 2021 is a new function or group called revenue operations. We first saw this and we're seeing this really in more of the tech world or high tech companies, but really at its edit's core rev ops is a, a new function or an evolution of a function that better align sales, marketing support, and accounting and finance across the customer life cycle. . So you'll often hear to customer 360, right? That full view of, of the interaction and engagement with a customer and organizing that under revenue operations to support those different functions really helps companies have greater predictability over their own growth and their own revenue by sharing information across all those teams. We think the ideas and functions that you see in revenue, operations organizations in the tech world are gonna migrate to other industries in 2021 in the following years.,and this is just a fantastic, a phenomenal opportunity for our accounting and financial professionals to kind of get out in front and take advantage of this function to really help their organizations grow. Closing: (15:39) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Gary Piscatelli: https://www.linkedin.com/in/gary-piscatelli-5a64766/Hunter Douglas: https://www.hunterdouglas.com/FULL EPISODE TRANSCRIPTAdam: (00:00) Welcome back to Count Me In IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson, and this is episode 108 of our series. Today’s conversation features Gary Piscatelli, Senior Vice President and CFO of Hunter Douglas North America. Hunter Douglas is the worldwide leader in custom window treatments as well as a major manufacturer of architectural products. Gary joins us to talk about business transformation and what kind of leadership is necessary to successfully complete a business transformation. Now let's jump into the conversation. Mitch: (00:44) What does business transformation really mean for today's business leaders? Gary: (00:49) You know, it's an interesting one. You probably ask, you know, 10 people, you get 10 different answers, but for me, it's pretty simple. It's getting better at delivering on your strategic objectives, you know, or whatever they may be. You know, in some companies they're, you know, financially focused, it could be sales, it could be profit, it could be market share. It could be market position. It could be long term  stability, customer acquisition, quality, product innovation, et cetera. Whatever those goals are, it's finding ways to accelerate, achieving those goals. It's as simple as that. Mitch: (01:28) That's a very clean cut definition and something much simpler than I've heard in the past, but definitely makes sense, and definitely the goal of a whole business transformation is improvement and acceleration. So, you know, when business leaders look to make these improvements and they hope to improve the organization, is there a  type of culture that is really needed for a successful business transformation, and in that culture, in implementing this, are there certain challenges that a business leader needs to be aware of as they're going through the process? Gary: (01:58) Yeah. I mean, certainly some cultures are, you know, more conducive to accepting change than others, but you can't control the culture.. Certainly, you know, when you're starting to make a change and culture change takes a long, long time. So you have to really work within that culture, but there, there is something even more important than culture when it comes to change and that's leadership, and you know, without, you know, buy-in from leadership, even if it's just a CEO, but you need someone with decision-making authority, but then it, you know, has the ability to control that change to buy in, and if you don't have that, it doesn't really matter what culture you have. And, you know, I find leadership to be 100% accountable for results, including change. And it doesn't really matter what that culture is. You know, and there's some common things, to driving change, regardless of the culture. And the first thing is, Hey, no one wants to be changed. You know, if I asked you, you know, Hey Mitch, do you want me to change you? You know, you would say no, and you know, I would answer it the same way. So you have to go into it knowing that no one wants to be changed. Everyone thinks everyone else needs to change typically as well. So what you have to do is you have to find a way to talk to people at a level that they want to be talked to, and everyone would like their problem solved. Everyone wants their life to get better, right? So the first thing you have to identify is what are the things that are really wrong in an organization that you can get some alignment around.  The people would generally agree that yeah, you know what, that's a problem. We need to make that better. You don't even have to have, have a solution. You just have to identify a problem, right, and try and get alignment that people would say, yeah, I want that to be changed at that point in time, everyone's probably pointing the finger at everyone else. I think it's someone else's fault. It doesn't matter. That's okay. Even first step is get recognition of a problem. The second thing is to try and get people to fundamentally it without pointing fingers too much as to what do we think the root cause of that problem is? Right? So we can actually start to develop solutions around, change around how we fix it. And the third piece is, you know, even if you get people to say, Hey, we have a problem and we have a problem. You know, we definitely want to get better at X, Y, and Z, and we even know how to do that. You know what I've found? And I was kinda shocked. you know, I think it was probably that my third big change, I had a room of people, all finance leaders, and I spent 20 minutes talking about what needed to be different. Everyone in the room nodded their head, complete alignment. So then I said, who's with me and no one was with me and I just didn't get it. I'm like, why, why won't these guys? Why don't these guys have just told me, they'll have a problem. They're all senior leaders in a company. You know, they they're responsible as far as I'm concerned for driving improvement, but they're not interested. And that's when I figured, well, gee, I've got to have in advance figured out what's in it for them. Right, So I've also had to figure out how can I talk to them so they're going to get on board. Right. And, you know, everyone is motivated by different things, right? Some people are motivated by money. You know, some people are motivated by job security. Some people are motivated, motivated by, you know, career progression. Right, so, and you can't just come up with one solution, right, because everyone's got different factors, they're going to drive their ability to get on board because change comes with risks and they're in risk and work. Right. You know, it's not easy to change, right. So people are like, why should I, you know, spend a lot of time working on this when I'm, I'm happy, you know, doing my job as it is today and getting paid as I am today and what's in it for me? So you really have to think through those things, at least with, you know, a handful of leaders so they understand, you know, why it's going to be good for them. At the same time, what you can do is, you know, outside of that change, you can start to change your incentive program because you know, pay does motivate people. So, you know, even ahead of that change, you may want to restructure whether it's short-term incentives, long-term incentives, even your annual review process. So that, to the extent people get on board, they're going to get rewarded and that's something I've, I've done in the last two places I've worked, you know, ahead of the change was to change the incentive program. So at least the compensation elements somewhat addressed, you know, getting on board and compensating people for delivering. And that's why I go back to transformation is about accelerating achievement of business results, right? So you should be doing it because it's going to make the company better. From there, there's more, you know, the other mistake people make is, you know, especially a lot of, a lot of financially driven changes there's associated cost reduction and people make too big a deal out of cost reduction, especially around people. And if you try and sell a change that says, Hey, it's going to result in 25 or 30% of the people losing their jobs, and you then want people to work really hard to make changes so that they won't have a job that's hard to do. So, you know, as I've kind of moved through changes in my career, especially the last one that I worked on at the company, right now, we didn't even address that because here's what I've found. You know, I worked for a company and I led a finance transformation there and handled change differently. It was a top-down driven change sponsored by the CEO, and it's like, you will do it or you'll get fired. Right. That was their approach. It worked, it wasn't so nice. Right, and we probably could have done it differently, and it did deliver on objectives, but people were scared to death because we said at the end of this we're going to fire 35% of our staff. All right. So try and get people to work like 12 hours a day, 13 hours a day, work weekends when the reward is to get fired, right. The economy was at the right point in time, there weren't a lot of options. We were able to do it, but it didn't make it easier. And what I've learned in that process is didn't have to fire that many people, because a lot of poor performers were so scared of getting fired. They quit. So by the time we got to the point where we needed to terminate people, a lot of most people didn't get terminated, very few people lost their jobs. So we, in hindsight, we could've gone about it differently. We probably still wouldn't have the same level of attrition. We wouldn't have that scare the crap out of people to be, to be blunt and would have done it in a nicer way. I think people would have been more comfortable operating in the change. It was a good learning for me, and when I moved into another company. We did some finance transformation. You know, I talked about, you know, reorganizing staff and moving, you know, bodies around, because A lot of this, isn't a net reduction. It's trying to create business partnering roles and, and minimize accounting roles, which you'll hear a lot. And again, we didn't really have to get rid of a lot of people. You know, the people left and the people that left, we had poor performers and they should have left anyway. Right. I mean, they were the people that they, weren't going to survive because, you know, typically when you make these kinds of changes, you know, the accountability is, is, is kind of twerked up a bit, and people know that it's going to be hard to hide, right, in a new environment and people that are afraid of accountability and don't necessarily have the skillset to keep up, just leave. So that very few people end up getting terminated, and these organizational changes and even where I am now, you know, it's kind of the same thing. So what we did here was different culture. They weren't as interested in driving immediate cost reduction. So we said, look, it's not about cost reduction. If it happens, because you know, that's what the business requires, then we'll go for it. But we're not going to make these changes, you know, simply to try and reduce head count. And that was a message that was communicated over and over again. And it just made people feel a lot more comfortable and we haven't gotten rid of a lot of people cause we didn't need to. So, you know, if you can afford to procrastinate on communicating some of the harsher decisions associated with the change, you're better off procrastinating because you may find, you know, your original thinking about all these folks you're going to fire just, isn't true. And that's happened multiple times in my career. So either I'm lucky or I'm right. It's one of the two, maybe, maybe both. You know, the other piece is adapting. You have to adapt constantly. Everyone always wants this huge change and you should create a vision that really gets you to this place that maybe you'll never achieve, but you set, you set the goal really high, but the reality you said, you accept every incremental change you can get because as you inch forward, you get closer to that goal. And some folks, you know, have an all or nothing perspective, Hey, if I can't get this done, I'm going to do nothing, and you'll get faced with a lot of challenges. You won't be allowed to do everything you think you should do. And that's perfectly fine. You take what an organization will give you, and then you continue to focus on the end goal, but as you get closer and closer, it gets easier to get there. And another thing, and these are all lessons, is you have to do use failure as an opportunity to re-plan and address immediately. You can't beat people up for failures, because change is hard. If you failed as a leader, you're responding for that failure and you take full accountability for that and say, what do we need to do differently to get back on track? And no one should be penalized for failing. They should be rewarded for immediately bringing it up, so you still have an opportunity hopefully to try and, you know, readdress and get where you want it to go. The last piece, cause I know I've gone on, but this this is my longest answer to any question. Right? And I have, so just to, you know, is to constantly remind people of that ultimate goal, constantly remind people of the progress you've made and constantly remind people of, you know, what you've got left to do. And all three are important because people forget where you're heading. People forget about what they've already delivered and they take it for granted. So you already done some good things and you know, you should feel good about that and remind them, but always let them know that we want to be. You know, sometimes I use the words and it's simple. I was doing this the other day with someone, we were trying to set a goal and it was for a finance supply chain organization that we're setting up. It's a new, new organization, we're restructuring. And I said, remember what I told you, because this person was on my team for, for an overall company transformation for am right now. And I said, what was the goal that we had set for ourselves? And, and I can't quite say, cause it's not, not too clean, but I said, we want to be something awesome. All right. That was, that was the goal we set for the team, right? It was, it was an aspirational goal. And I said, so when you set goals for this organization, what do you want to be? And then below that, you'll describe what that means, but you need to set a vision for people that they can get behind that really inspires them to want to get on board, and you know, it can be as simple as you, you want to be awesome. And then you can explain to people what awesome looks like, but it's important to keep reminding people that we never, never get to awesome, but awesome is what we want to be. Mitch: (13:13) A few of the things that I really enjoyed listening to, and kind of pulled out, I think lead us through the rest of the conversation here. You know, you talked a lot about the individual within the organization and ultimately with transformation, essentially reallocating resources, right? You talk about human talent. You know, how do we up-skill re-skill, you know, adapt to what's going on and what change is necessary. A big part of the finance function and, and adapting and upskilling reskilling is about the digital evolution and everything that has come in through the finance function, and my next question is, you know, what role does digital actually play in these transformations? And how can you adapt and adopt these new advancements? And then really with all of this potential and opportunity, is there a right time for it? So how does that fit into everything you just discussed? Gary: (14:09) Yeah. I mean, digital has been the buzz word for the prior, the past two or three years, and it's one of those things that depending on what consultant you're talking to, they'll tell you digital means something different. And you know, it reminds me a little bit of Sarbanes-Oxley from years ago when everyone was scared of Sarbanes-Oxley, it wasn't really defined and the consultants would define Sarbanes-Oxley and what it really meant. And I think we've got a little bit of that going on right now. So when I think about digital, I think about multiple things, you know, I think it could mean just improving your base systems, ERP systems, you know, you know, customer support systems, you know, manufacturing inventory management systems, but it could also there'll be on, it can be artificial intelligence can be artificial intelligence about data analytics and reporting. It could be artificial intelligence about robotics and, you know, automating, you know, transactional systems. Right. So, and I think it's just so broad when you think about digital. So when I think about transformation, as I said, the first thing you think about is having a common understanding of a problem, right? Having a goal of where you want to get to and thinking then thinking about what role does technology play now and possibly in the future in helping you get there is really, cause we're just talking about technology, right? So, and as you think through solutions, you have to think about technology. Now technology comes with a cost, both from a dollar perspective, you know, because it may cost you more to implement technology, but it also comes with a human capital cost, and what I mean by that is when you think about change, let's say you were going to go through a shared services project and you had people all over the place, and, you know, as one of those first steps, you know, let's say it's accounts payable. You wanted to have a common process for handling, you know, accounts payable. Accounts payable is a place you could all also implement robotics as well to try and, reduce your human capital needs. But if, if I were thinking about this one, I would probably look at that and say, well, Hey, if I was going to look at accounts payable, I'd probably first bring it together, make things common, right. You know, see how efficient I can get it, think about, you know, how much more technology might buy me once I've done that and then evaluate technology. And whether that's accounts payable, payroll, you know, general accounting, where areas, customer services is another one if you go outside of finance, right. That, you know, there's a lot of robotics in place right now, but I think you want to optimize the process first. You want to standardize, optimize the process, get your, your root systems standardized, and then think about things like robotics as an example. When I think about things like artificial intelligence and reporting, which is another thing that, you know, everyone's trying to sell everyone on artificial intelligence and reporting, Hey, the machine can actually figure this out for you and point you in the right direction. Right? There's a lot of work that goes into thinking about what's important, right? And if you don't know, what's important, you know, garbage in garbage out. So you really have to upskill your organization to have an organization in people that really are at that level first, before you would then invest in technology to try and help automate a lot of that solutioning. So I think technology comes in at the end, you know, not at the beginning and it's, it's no different than where you're in, you're implementing an ERP system, right? And you've probably heard people that have failed in ERP implementation was because they made them technological projects, right? They're not technology projects, they're business projects. The most important part of getting an ERP implemented is making sure you understand how are you going to do things who's going to do it, how you're going to do it. And that, that blueprint that some consultant use that design phase and getting that design right, is the most important piece, and I think the same applies to some of these other forms of technology, whether it's robotics or artificial intelligence on, on reporting. I think it comes at the end, not at the beginning, unless you're already ready, and a lot of companies are, I don't think are ready. Mitch: (18:15) So I'm going to kind of combine two questions here because you, you just started to touch on something that I did want to get to a little bit later. So you talked about kind of testing out certain departments, certain tasks maybe. And I wanted to know, you know, what your thoughts are as far as, is there a way to determine if transformation is even right and whether it's the right time, the right place, so on and so forth. And many times we hear finances usually, the first function that, you know, should be assessed for transformation because of a lot of the technology that you just talked about. So what really is the finance departments function or a responsibility when it comes to, you know, assessing and testing out different transformation across the organization? Gary: (19:03) And then there's, there's finance and then there's, just business leaders, right? And I think folks who work in finance, you know, wear their finance hat, but I also think that is where general business hat. You know, so from a pure functional perspective, you know, finance plays the role, you know, as the, objective function to provide data, to really understand the current situation and, provide a perspective and objective way as to what do we think improvement looks like, what will it deliver in benefit and what will it cost? Right. So the finance function needs to play the role of making sure the organization objectively looks at both the need for change and the benefits associated with change costs and benefits associate with change. So that's the functional responsibility. The, the business, responsibility is to go back to question one, right? How do we drive business improvement, and what's our role as leaders in the company and driving business improvement, and where do we see opportunities? How do we tee up those opportunities in a way that people understand them? How do we try and push those opportunities and agitate action, you know, where we can, and then how do we take a more responsible role in driving that change, if that's what it's going to take, to help us accelerate achievement of those objectives and that active role could be in the function or that active role could be in working on, helping another function achieve those objectives. It doesn't have to be within finance. Mitch: (20:42) I guess this is a good way to wrap it up. You know, just also considering what you just business leaders, organizational leaders, whether it's in finance or not, depending on what hat you're wearing, what role do you have when it comes to responding to subsequent results from business transformation. Meaning evaluating the outputs and, you know, establishing those benchmarks for the improvement, the acceleration, the success as an organizational leader, how do you communicate that, and what's your role as this continues to evolve over time? Gary: (21:19) Yeah, I think it's just to remind people, you know, so a lot of, a lot of benefits associated with change, some are very tangible and easy to look at and others are squishier, right. So for example, if you are looking to drive, improve sales, you know, tying your change effort directly to improve sales can be very difficult, right. Or if you're looking to improve quality or customer service or, or some things that, Hey, your change effort probably influenced it, but can you specifically point to, was that the only thing and it's unlikely, right. So I think, I think we make a lot of the analysis a little bit too binary and, you know, and cause, and effect, and there's multiple causes and multiple effects. So it becomes very difficult. So what I try and do is just step back and say, Hey, look, if we look at the big picture, do you be seeing an improvement here? Yes or no. Do we think the situation is better or worse based upon how we're operating today? Then we can talk about how we operated before and how we're operating today. Did it improve things or not? Did it improve things enough? You know, you can answer that question and say, we had a goal. Whether or not, the change effort and enabled enough or not. It's hard to say, but you still might have the same goal. And then you, it becomes somewhat irrelevant. I don't care if the change effort did more in something else compensated to offset that. Or I don't, I don't care if the change effort didn't get all the way there. I still have a goal. So it goes back to one of the earlier questions. You're constantly looking at the end, end goal and trying to figure out how to get there. And it doesn't really matter at that point, whether or not you perfectly delivered or over-delivered, you know, you have a goal, you might have a new goal that's even more aggressive. You're constantly trying to get better. So what I try and point to is, Hey, here are the benefits. I think we achieved. Here's the ones that a little clearer to look at versus others. I still think we have opportunity for improvement because you always do, even if you're at your goal and what do we do next to get there. And the, and the finance function, should be continuing to agitate continuous improvement. As the CFO, you know, you should be agitating to try and make the organization better all the time. Closing: (23:33) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard. And you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

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Contact Clive Webb: https://www.linkedin.com/in/clive-webb/ACCA and IMA "The CFO of the Future": https://www.imanet.org/insights-and-trends/business-leadership-and-ethics/the-changing-role-of-the-cfoFULL EPISODE TRANSCRIPT:Mitch: (00:00) Welcome to Count Me In IMA's podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong and I'm here to kick off episode 107 of our series. The role of the CFO has evolved and in turn  the skills required of aspiring CFOs have changed too. In this episode, Clive Webb Senior Insights Manager at ACCA shares his perspective on what today's CFO is responsible for, what skills are needed, how the pandemic impacted the role and the best ways to prepare for becoming a CFO. Keep listening as we transition over to the conversation now. Adam: (00:46) So Clive, how was the role of the CFO changing.? Clive: (00:49) Well,Adam. I think that's actually quite an interesting question its is, right. I think for a lot of CFOs, the role it is broadening, perhaps you could even say dramatically broadening, and its focus and how it is perceived are changing quite substantially. And what I mean by that is that certainly from the research work that IMA and ACCA did together, we felt that the role of the CFO was either increasing or significantly increasing. And in our survey about 72% of the respondents felt that the role was broadening out, and I'll talk about that in a second. But actually quite crucially, and one of the things that was quite strong in the report, we also asked a small selection of CEO's their perception. And if you asked the same question to them, you've got about 82%. So one of the things that we repeatedly saw through the report was if you're going to demand and supply side difference between the CEOs, who really expected the CFO's to go even further than perhaps they thought that they were going, and I think that broadening of the role is characterized by a broader set of stakeholders, a broader set of capitals, a broader set of responsibilities that all fall within the CFO's domain. Adam: (02:30) That makes sense, so then what do you consider to be included in the role CFO? Clive: (02:36) So I think the heart of the role remains the traditional financial acumen and financial skill. And as one of the interviewees put it, if the CFO doesn't get that right, then that's the end of that CFO, you know. So that stewardship, guardianship, asset safeguarding, traditional finance, recording, acumen, all those sorts of things, risk management, internal control, they are at the heart of the role.and very much still at the heart of the role. However, the CFO, I think you can counter itin two ways. Now the first of which is thou the, the right hand, the conscience of the CEO. So where the CEO particularly is looking more towards, sales, towards business growth, towards strategic opportunities, the CFO, yes is looking towards those, but also is the voice of dare I say, sanity. The voice of check the constructive right hand in that process. So not only do you need a view of the financial capital, the liquidity, the organization, which we've seen through the pandemic, it is absolutely vitally important. But if we think broader, it is a role that now embraces  strategy. It still has that risk and control side, but that risk and control side itself is changing. And technology and data are playing fundamental parts. A lot of CFOs increasingly talk about scenario modeling and growth optimization as the future, and to do that, you need good technology and that good technology has to be embedded in data and that data has to align to the business strategy. They are therefore leaders in the organization, and as we've seen supply chains become increasingly challenge due to the pandemic they need to be on top of that agenda and also the customer centric agenda as well. And any of these broaden out into broader sense of what your stakeholders may be, how you think about the different capitals if you use the Integrated Reporting Councils Framework of six capitals. A lot of our interviewees thought the CFO increasingly needs to take view and manage stakeholder relationships at senior level across all of those capitals. So your investors are different. You are the ultimate consultant in business sense, and you've got to have a mind of transactions, M&A,  growth or divestiture, which, you know, the pandemic is going to place, an increasing focus on as well. So that's what I mean, it's a very much a broader role. Adam: (05:52) Yeah, it's definitely a lot broader and you've briefly mentioned the pandemic and we're still in this pandemic and for the foreseeable future and the vaccines and all those things put aside, how has the pandemic impacted the role of the CFO? Clive: (06:06) I'll go back to a couple of comments, I think from some of our interviewees, and one of them who actually was a CEO, but a former CFO of a finance institution said, yeah, the role of the CFO has been tested by the pandemic, and it's the reliance on the CFO. That's going to become more important to give those perspectives, to give that ability to see further, and it's becoming an agile role is another one put it that there's no place for perfectionism, but there is a place for being able to be agile and to drive the business forward with a sense of confidence and, and therefore understanding the various leavers that are pulled. So in those two contexts, I think what we're seeing and back to my point about the right hand of the CEO is the CFO increases become a very important role in helping organizations understand what the art of the possible is, what the various scenarios that may play out will lead to, and therefore how basically the organization can survive. And I think the pandemic has reinforced the role of the CFO in very much making that happen. Adam: (07:33) In the report, there's a six hypotheses and do these six hypotheses, illustrate the changes happening now for many CFOs? Clive: (07:43) Yeah. But that's right. I think it's probably worth me just explaining quickly for the benefit of those listening, that what those hypotheses were, and some of them I've touched on already. The first is that the CFO role broadens out purely from the financial investor and stakeholder management into a broader sense. So keeping that safeguards in reporting, but broadening out what that stakeholder focus actually is. And that the CFO therefore has to have a leading responsibility for business strategy, formulation and validation and its execution, and to do that in the third hypothesis, it becomes around, shifting from a cost centric view to a grow centric view, and I know at the moment that may seem a challenge, but in reality, I think more organizations increasingly focusing on the three P's and that growth becomes a more clear agenda, and to do that, there's a wider view of performance, and this is where those sits capitals come back in. And it therefore is a role that is looking forward, and that underpins, I think that scenario modeling that I've talked about, and it becomes a role that is about forward insight, and I think the pandemic has very much reinforced that. In ourI last hypothesis and perhaps the most interesting one, became about career progression and whether the CFO was a step towards the CEO role. And the reason I say that's interesting is on a global level, when you looked to the results and we asked several respondents to give us insight into this. The majority of the early ones were yes, sort of being achieved or went on the road to being achieved. You come to career progression, you start see a fairly sharp geographic difference. And in the Asian economies, very much the CFOs is the CEO in waiting, and there is a clear set path. In the UK and in Ireland, and some in the US, the CFO role is very distinct from the CEO and some of our round table participants sort of said, well, actually, the CEO is, is too sales focus is too dynamic, and I'm a more conservative individual. So you see a difference opening up between career ambitions between sort of developed and other economies, if I can put it that way. Adam: (10:22) So we've talked a bit about, you know, how the role is changing and how the pandemic has impacted the roles. So let's shift a little bit, can we talk about what, what skills does a CFO need and an inspiring CFO need to develop? Clive: (10:37) I get back to the sort of nine areas I outlined a few minutes ago, but I think fundamentally from those understanding data on understanding  technology are absolutely fundamental. And that probably is as fundamental now to successful organizations as that financial acumen and financial stewardship piece is. So if you align that to the strategy that becoming increasingly a more operational focus role, and I think that particularly in smaller entities, that is absolutely fundamental, because the CFO is the, the super connector, if you like, and being the super connector is, a role that requires leadership across the organization, but a role that requires leadership across the communities as well. So it's the ability to tell story, to give the message, to understand the message to see the future. So there's a very strong interpersonal skillset.  There is a  a very strong, perhaps what I might term quiz or consulting skillset, and then you have the financial, the technology and the risk scale sense. And I think those are the fundamental bits. Adam: (11:55) You have, the fundamental ones are there, other skills that are needed beyond the traditional skills to, as the, you know, the future of the CFO continues to develop as in the constantly changing environment. Clive: (12:07) I think probably we will say this continuous evolution, transformation and change, and they need to be ultimate change leaders in organizations and as increasing, I think, and this is probably also from what we gather a result in parts of the pandemic, back office functions becoming more centralized, more coalesced with finance very much at the core of that. It is leadership across that, but it is also how this ever constant change cycle, digital transformation, agility, whatever phrases you want to call it by, that sense of constant change and leadership in the time of constant change and reassuring the teams and bring their teams with them as part of that change is an absolutely fundamental skill set and now needs to be developed. Adam: (13:03) So what's the best way to develop these skills? Clive: (13:07) That, that itself is an interesting question, and I go back to the, sort of the survey results and only about 25% of the CFO's and other respondents thought enough attention was being paid to developing these skills, but I think a lot of our round table participants characterized it in two ways, obviously that there is the core financial qualification, and that is absolutely fundamental and vital. I think, as this role becomes increasingly growth centric and scenario centric that financial acumen is fundamental. So the qualification is a bedrock, and one of our round table participants then added to that statement that actually on what an MBA taught them to do was remember what they've forgotten about their accounts see qualification, and they should learn how to reapply it, if you like, which I thought was interesting comment. I think a lot of it is actually about on the job learning. And a lot of our CFOs talked about the need to make sure that they develop the next generation and mentored and coached. And quite a few of them talked about, you know, as their own careers progressed, the need to leave behind one or two viable options in an organization who will be prepared to succeed them. So I think continuous learning, mentoring the role of peer to peer networks, being involved in CFOs communities, they're all very, very important grounds to learn the skills. Yes, the bits of technology you can learn micro qualifications in some areas absolutely important, but it is being coached and developed in that skillset. And rather interesting where we ask people where they thought the next CFO was going to start coming from the most important experience that they need to have in their CV, If you like, is that a real finance business partner and that traditional path, perhaps a being from, you know, a senior manager or a director in one of the big four firms, and then swapping over to be a CFO, that path seems to have slightly closed down. And there's more emphasis on in-house experience, but broader experience such as a finance business partner role and such as working in the business in other areas is important. the other contents I would add to that is another theme from the report, which talked about the concept of a world view and the sense that yes, you need to know your industry, but more importantly, you need to know the world in which your industry exists. So therefore industry specialization is not necessarily fundamental to develop in skills. What is fundamentally is to have a view of where the organization is set in the greater economic ecosystem, if you like. Adam: (16:26) Well, Clive I thank you so much for sharing your insights with us today on the podcast. Clive: (16:31) It's my pleasure. Thank you, Adam, for giving me the opportunity and yeah, there's a lot more in the report, so please go and read it. Adam: (16:39) Yeah. And to our listeners, just check out the show notes we'll have the link to her directly to the report that Clive is mentioning. Closing: (16:48) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Loreal Jiles: https://www.linkedin.com/in/loreal-jiles-804648a1/FULL EPISODE TRANSCRIPTAdam: (00:00) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson, and today I'll be kicking off episode 106 for you. As our series continues to grow and evolve, we try to target new topics and areas of interest for our listeners. In this episode, Loreal Jiles, IMA's Director of Research for Digital Technology and Finance Transformation joins us to talk about the popular topic of agile. In our conversation with Mitch, she talks about how management accountants can take an agile approach to finance transformation. To learn more about agile, scrum and project management, keep listening as we head over to their conversation now. Mitch: (00:50) So it seems like one of the trending things people are talking about these days is agile. Can you tell us a little bit exactly about what is agile and where did it originate? Loreal: (01:00) Sure, sure. So, while I'd say agile approaches to delivery date as far back as the 1950s. In the 1950s Toyota, kind of undertook this transformational introduction of lean manufacturing, and it hadn't really been done in that manner before. And so I'd say way as far back as the 1950s, it had been in use in general, but I'd say agile didn't really pick up speed for software development until maybe the nineties or so the 1990s. And so prior to the nineties software development was, was delivered largely in alignment with something they call the Waterfall Model. And so we'll talk about that in a few minutes, but, what agile is specifically agile methodology as a software development life cycle, and it focuses on iterative incremental delivery, and that delivery happens by self-organizing and usually cross-functional teams. So it's a people centric, results oriented approach to software development. And again, it's become recently popular and has been, I'd say proven adaptable for business teams, delivering products and projects as well. So it started to kind of broadly from a manufacturing perspective, it grew in popularity from a software development perspective, and now what people are seeing is that the same attributes and values that, that agile have, are applicable widely in a host of project management settings. And that can be for any type of project or any type of product as it's typically characterized. And I'd say the only other thing I'd call out as we talk about what agile really is, is there's this concept of being agile and demonstrating agility. And then there's another specific agile methodology, which is used for software development or project management. So, so we could talk through through both of those as we keep going here, but I'm just really excited to be talking through what agile is and then start kind of breaking down some of those barriers. Mitch: (03:12) Yeah, absolutely. So let's talk a little bit about applicability to our listeners now. So accounting and finance professionals, what does an agile finance function look like and what role, or what role is really, does add agility play for finance transformation? Loreal: (03:29) Yes. So everyone's aware of finances going through probably the largest transformation in its history, and that's not limited to just the digital technology aspects that we've traditionally focused on, but it's also about how the finance function delivers value more efficiently supports strategic decisions of the businesses that they operate in. And so, as we think about agile finance functions, they're creating value by, I'd say employing scalable, efficient operations. They usually have transparent and accessible data and metrics. There's frequent inspection of, of the work product that's being produced and that's to ensure fit for purpose insights. The agile finance functions are also quick and, and responsible. They demonstrate quick and responsible adaptation to change, and so this concept of failing fast is really prevalent and agile finance functions, and I think lastly, I'd say they're empowered, and capable multidisciplinary teams. And so often we see teams operating in silos and that's not customary of an agile finance function. So there's much more collaborative environment where multiple people may weigh in on, on a certain decision, but it's structured such that there is increased transparency and, and everyone is working together for the same objectives. And so when you pair kind of those attributes with advancing technologies, position, finances, kind of position to streamline their day-to-day tasks, and then accelerate project delivery, and so when we think about agile functions, they're typically well-versed in, in one or more branches of agile methodology as well,and that can be anything from Kanban, all the way to the most increasingly popular scrum. Mitch: (05:27) Well, you just read my mind because I know I've done a little bit of research on agile and anytime you look at agile methodologies, often you come across scrum. So what exactly is scrum? Loreal: (05:38) Yeah, so scrum is a process framework, and that framework has been used to manage work on complex products easily since the early 1990s and probably a bit before that. So scrum is not a process. It's not a technique or, or a method. The way that it's characterized by its founders is scrum is a framework, and it's a framework within which you can employ various processes and techniques to, to get the outcome that's needed. So scrum is a framework within which people can address complex adaptive problems while productively and creatively delivering products of the highest possible value. and so when we think about what the scrum framework consists of, there are scrum teams and their associated roles. there are scrum events. And so those are different, meetings or sessions that you'd need to have or ceremonies, they call them, in some instances, scrum artifacts are the, there could be things like a backlog where you've got a list of all the things that needs to be delivered for a product, and then there are some rules that, that kind of govern each of those aspects of scrum. Each component within the framework serves a specific purpose and it's essential to scrums success and usage. And so the one other thing that I'll call out is when, when agile became popular back in the nineties, there a group I'd say maybe a decade later of 17 people wrote something called the agile manifesto and that agile manifesto kind of outlined the principles and the values of agile and two of those 17 members, Ken Schwaber and Jeff Sutherland partner together to deliver something called the scrum guide. And so that's widely viewed as kind of the Bible of scrum and most people, if anyone wants to learn more about it can access it at scrum.org, but in its purest form a framework for how we get things done that are really complex where we can break it down into bite sized chunks. Mitch: (07:47) Okay. That makes sense to me. And I know we talked about agile finance functions. So now let's take a step further and let's apply scrum to the finance function to, how exactly do the agile methodology and scrum framework relate to, as you said, complex adaptive problems, something in finance like finance transformation. Loreal: (08:06) Yep, absolutely. So, agile and scrum are used to expedite delivery within the finance function. if you're employing these, these techniques, then you're fostering a culture of failing fast, projects get delivered with fit for purpose solutions, the function is better positioned to accommodate time sensitive analysis requests as data analytics is, is certainly becoming more prevalent within the function, and within the profession broadly, we get lots of ad hoc requests. And so accommodating those in a responsible manner happens regularly through the use of agile and scrum. We, we coordinate better with IT groups who are progressing more holistic, digital transformation journeys within our organizations. And so your  IT  group in most instances already employing agile, and it's important as we embark upon this digital transformation, that component of what finance is doing more broadly, that we become well versed in what IT is doing as well. And so in a lot of instances, we have to wear a certain hats, as finance members to work with the it organizations and we would enable their delivery if we're more well versed with that also. And lastly, I'd say we manage our projects more efficiently and ultimately deliver greater value to the businesses we support when we're using agile and scrum. Mitch: (09:33) Do you have any use cases or specific examples, something that our listeners could hear and potentially apply as you know, an example of a finance team that's using agile and scrum? Loreal: (09:45) Absolutely. So I'll start with saying the roles that we play in a scrum team. So in a scrum team, there is no project manager and in a scrum team, there's only a product owner, a scrum master, and the development team. And the development team we traditionally think of as a group of IT folk. And that's absolutely the case in a lot of instances, but when you're adapting this, these concepts in this framework to business solutions or finance and accounting processes, then the development team could just be a group of financial analysts or a rep from your policy team. If you're needing to change a new process to accommodate a new regulation that's come out. So what I'd say the most popular applications of scrum is the role of the product owner. The role of the product owner, the product owner is accountable for overall product value delivery and prioritizing the backlog or the list of things that needs to get done to maximize that value. And so I, when I worked in an industry, I was working on robotic process automation and I served as the product owner. I was sitting within the finance organization and there was a team of, of finance as well as IT persons that were on the development team. But I served as the product owner overseeing, you know, this is exactly what we want to get out of this particular product. And in that scenario, the product was robotic process automation or RPA. So that's a really specific example, but I'd like to give a few others that may resonate with people in the audience, more who aren't as close to this. So the most popular application, again, using the product owner role, or just in project management and analytics in general. So if you've got complex initiatives with unknown solutions, and there's a high reliance for feedback on the end users and the end users could be stakeholders within your finance team, it might be some of your leaders, the controller. In finance and accounting. This can be found in project management when implementing new digital technologies or enhancing existing systems. So if you've got your ERP, if you're using SAP and you need some things to be changed to that. Then you're putting in a request with your IT team. In most instances, that request is being added to the it team is backlog. And so this is where all this kind of comes full circle. So if you need to enhance existing systems, you're adding items to the backlog. If you're modifying processes against and meet new regulatory requirements, then the outputs would be the product. So in that scenario, you would have, I'd say, you know, this new process that we need to define to make sure that we can meet the regulatory requirement or complete a new report, then that output would be the product and everything we need to do to be able to deliver that. If that means we need to, you know, do research on what the policies are, do research on what our existing compliance processes look like, do research on what needs to happen within the system itself, and then implement that. All of those things would be on the product backlog for us to modify our processes, to meet new regulatory requirements. and then of course there's the delivering kind of ad hoc financial reports or analysis. So the finance function can strengthen its analytics capability as we're already doing, and scrum in that instance would be used as kind of the perfect delivery mode to efficiently respond to unplanned requests in some instances as well. And then two other examples that I'll give, one is financial planning and budgeting or financial planning and analysis. Rather than developing a static annual plan and holding teams accountable for delivery against those plans, which is most customary. Some organizations have employed a scrum approach to fiscal planning, and that begins with the full year plan just as we normally put together, but then treats that plan as a true estimate. So management accountants, and a lot of instances when they're partnering with the operational leads would update the full year plan by maintaining a 12 month outlook on a rolling basis. And they also allow for updates quarterly. In some instances, performance then would be judged against quarterly plans. That account for external environmental factors, market conditions, changes in risk profiles. And this model would allow for regular inspection of the product and the product in this example would be the budget. So the budget is what you're trying to tackle. Then you're applying an agile approach or a scrum based approach to putting that together in an iterative manner and having it updated regularly. And the last example would be kind of finance operations. So this example, I really like it was employed by Scrum Inc., from by that organization. And this is nearly a decade ago. So well before we're talking finance and accounting transformation or modernization.Their leaders determined that the absence of finance tasks from their backlog was a company impediment. Which I think is really fascinating because they, if we don't have, a list of everything that needs to get done from a finance and accounting perspective and a way to attack it in an iterative and incremental manner, then we believe that this poses risk to the organization. So the team identified all of their accounting activities. they organize them by process type and that could have been all the account reconciliation activities on one side, all the reporting activities on another side, vendor payments, et cetera. And then they assigned all the tasks to the backlog, to the product backlog. And so their product owner would be one of the team leads that's within the finance group, their assignment of the cyclical and ad hoc tasks, even. So that's a unique one because you're using the routine processes that we're accustomed to working on, but when they applied them to the backlog, then they were able to eliminate the handoffs between departments because now everyone has visibility to what each team member is working on. They can weigh in on it and they no longer have to ask one team member, what's the status? Where are you? Because they can see it in real time on this backlog. And so that increased visibility to activities and eliminated silos between accounting and operational teams. And so those are some of the most prevalent examples that come to my mind when I think about this and what we can truly leverage agile and scrum for as we propel the transformation forward. Mitch: (16:18) Those are absolutely very relevant examples for our listeners. So thank you for putting all that out and kind of setting the stage for us. You know, the whole conversation has been great, very helpful, very informative. And thank you for sharing all of this. You know, I think some of our listeners may have a great interest in this moving forward and, you know, accountants and finance professionals who are hoping to get started with agile and scrum. Can you share exactly where they can go for more information or what they can do to actually start for their organization? Loreal: (16:47) Absolutely. So, the first thing I'd say is IMA is working up a suite of resources related to agile and scrum. So in early 2021, we'll have a couple of courses for agile and scrum that people can take, and these are pretty painless. So it'll take you an hour or less. One of those would be Agile and Scrum 101 and another would be focused on the application of agile and scrum specifically in finance and accounting teams. So the first one just demystifies it a bit and the second, takes it home and allows you, or I'd say empowers you even to, to make that happen or make it real within your team. We're also progressing lots of research in that area. So stay tuned for that. The piece beyond those resources that would be available, if you want to learn more, you can go to scrum.org. You can also go to Scrum Alliance. So if you search for Scrum Alliance, on the web as well, and there are resources on those sites that will support you to becoming certified as a scrum master. So I'm certified as a Professional Scrum Master. you can also get certifications in the areas of being a product owner, which for those of you who are not necessarily trying to dive all the way in and lead scrum teams, you don't necessarily have to go that far, but the role of the product owner is more popular, I'd say these days within the finance and accounting function. And so you can go to either of those websites to learn more about, the scrum process in general. The scrum guide is available for free@scrum.org. so hopefully that the IMA resources, as well as those that are available on these sites will prove beneficial to you. Closing: (18:32) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website www.imanet.org.

Contact Roland Abi Najem: https://www.linkedin.com/in/rolandabinajem/Roland Abi Najem's Website: https://www.rolandabinajem.com/FULL EPISODE TRANSCRIPT:Mitch: (00:00) Welcome back for episode 105 of Count Me In, IMA’s  podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong, and today's episode features cybersecurity and digital transformation expert Roland Abi Najem. Roland is founder and CEO of Revotips, Expert Tech Consultants, and Solutions. In this episode, my co-host Rouba dives into better understand the evolution of cybersecurity, including the risk areas and how finance and accounting professionals can better enhance digital safety measures across their organizations. Keep listening as we head over to the conversation now. Rouba: (00:46) You’re a cyber security expert in the region, you have been one for many years. What does the work that you do entail? Roland: (00:57) Well, basically it's the most important thing to me on a personal level I should work on is, being up to date on daily basis. And I really mean it on daily basis because sometimes if you, for me, on a personal level, I have at least for example, a minimum three to four hours readings per day. And, I have to stay up to date with all technology related issues about, all type of, technology, the less the news and cyber attack happened, worldwide and so on. So because we always learn from case study happened worldwide. Moreover, I have to say after this was all a governance issue about new laws, new regulations, because also those, rules and regulation of, being up to date, also kind of on daily basis. And, we have, let's say GDPR in Europe, perhaps a hundred rules and regulation here in the region. So we must follow those guidance as there'll be, for example, in GDPR, if you don't follow the guidance and regulation, you'll have fin, 10 million euros and so on. Moreover when it comes to cybersecurity, it's not only about the technical know-how of each person, what, what any company will look for when they are working with a certain cybersecurity company or consult them, they will look first for personal know-how. They will look first for, as a company reputation and a brand name and the look for the person or the petition of each individual who's going to work in cybersecurity because, you know, when you are working on cybersecurity, sometimes when I'm doing, let's say a penetration testing and so on. So, you might have access to very confidential data and so on. So for other companies, they will need to make sure that they have full trust in the company and each individual working on the project. Plus we all know that, working in the GCC region, is really challenging because you are working like, with, a different type of culture and society. Within in one company was in one country is so working with a different culture, different society, different mentality, you are working in different industries like, government, all I'm guys, banking, staffed up everything. So, you need to be, aligned with all types of cultures and societies in order to understand the needs and the requirements and how they think and how they perceive things. So actually it's kind of hectic to be combined and I'll combine all those together and to stay up to date with them. But actually this is what makes, let's say the thing different, and, this is what gives me added value, in this industry. Rouba: (03:43) No, that's quite a task that you have on hand. When we look at the, the Middle East and Africa cybersecurity market, I mean, it's witnessed some tremendous growth over the last, few years, more than a decade even, and it's projected to grow even further from an estimated 15.6 billion in 2020 to 29.9 billion in 2025. And the compound annual growth rate is 13.8, which is exponential. And this is based on the post COVID scenario forecast. Now, the lion's share really goes to Saudi Arabia and the UAE, and some parts of Africa when you look at these figures, but what are some of the most notable initiatives that are taking place in the region? Roland: (04:24) Well, this is a very important question based on what you said on the growth of, everything regarding to, cyber security in terms of spending, nowadays, lots of, government issues and rules and regulations. They are forcing by law each company, especially when I talk about big companies that have billions of dollars, to have at least three cyber security providers, because we all know that when it comes to security, is that is no, let's say a one plus one equals two. It's not that simple. So you need to have the different providers see different companies that are working in cybersecurity for you, because we all know there is nothing called 100% security and no company can be 100% secure of the time. If you are currently secured, you are secured, let's say up to 70, 80% maximum and so on. So there are still gaps. That's why I asked to have multiple companies under 10 providers. And this is what makes the industry, let's say, growing up so fast because for each company needs at least three companies for cybersecurity. This is number one. Number two, a few days back in the UAE is a consult ministers form, a concept for cybersecurity, which is, which shows clearly important nowadays for everything we got in cybersecurity, because let's say sometimes now we're on, we're talking about what, what we're talking about, the Cyber War, not the normal wars, is that like a World War One and World War Two. So I'll talk about the Cyber War and we all know that everything is happening between, uh, let's say, North Korea and Iran and Saudi Arabia and USA and so on, and we're not talking about a cyber war. It doesn't come with only with what you call it say about, only a just hacking and cyber attacks and so on. It's all sometimes about data. And we all know, for example, what's happened between Donald Trump and the big fight. And most of the big parts of it was political and part of it was economic, but the biggest part is about the data. Where am I going to store  the data and how we are going to, to store it somewhere. So I'm not sure the initiative is, in Saudi Arabia, they have what we call the National Security Authorities, where you can, for example, if you are under attack or do you have, now you can claim directly online and they will support you, and in many ways. Here in Kuwait, since I'm based in Kuwait, we have, two laws, you have the Image alone, and we have a Cyber law, every since cyber crime law, and so on. So, the biggest challenge, and, here, I think is, how we can join all those laws with international laws in order to, to be aware of all the laws and regulations worldwide in order to try to make for everyone. Because let me give you an example, let's say in the UAE or the Kuwait or whatever, they have lots of European people. So if you are working with an European person, you have to follow. So those initiative, done by the government here, they are trying to help people understand people in companies understanding more cybersecurity, support them by putting guidelines, not only laws and regulations putting guidelines, because currently for lots of people, cybersecurity is still kind of new., Okay, we are under attack. What you should, what's your to do. What is the next process? And again, here, I'm going to mention something very important that cybersecurity is not a pure technical issue. So let's say when you are under attack, you should not only solve the technical part. For example, you should also, know how you should address the press, to people, how you should, put a legal case against the hackers, what you should do as a government and so on and so on. So it's kind of a complicated issue. Rouba: (08:16) Yeah. I mean, from the looks of it, I mean, if you look at this region, they're very eager to enable economic diversity. And so markets like UAE and Saudi Arabia, where, as you said, there's been a tremendous amount of investment towards technology and the adoption of transformative digital technologies to be specific. I mean, they've been some of the highest in the world. You have the highest mobile penetration here. You have a massive penetration of internet, IOT, cloud, so successful examples that are mind blowing. You have, Emirates National Bank of Dubai, one of the leading banks in the region, they've invested more than $1 billion on digital transformation, but this amazing transition has opened up a new gateway for global cyber attacks. Where does the Middle East stand relative to other regions in terms of both the rates of cybersecurity, cyber attacks and back-end preparation? Roland: (09:10) Well, basically, what you said is very important. I will give you a similar example, but, in a different way. Here in Kuwait, we had the Gulf bank here in Kuwait, a few months back, they got hacked and, hackers stole like 20 million KD, which is around the $66 million. And, after maybe a few weeks, they were able to get some of them, and, by the end of the whole case, there was a shortage of, three to $4 million. So actually, when you are investing on cybersecurity, you are not just investing. And this is a top formation. You have also some impressive big amount on cybersecurity, because again, if you don't invest, you are going to lose them through cyber attacks and so on. And, I'm going to mention something very important here in the GCC region, and the actually it started to happen in a very speed way after the COVID 19, which is the nationalization for all locals. For example, we all know about quite a position of authorization and so on and so on. So I, I totally, this aspect because every company is, are trying to, give more of a, let's say advantage for locals over experts and so on and so on. But, the main questions that we should ask is that are the locals put in any context with regards , the country, as they ready to handle such a critical position as a Fiesel, or let's say CIO, or some key position in any company like banking or oil and gas and so on to be able to cover all the cyber security threats and technical issues. This is the biggest concern. So for example, in Kuwait, before COVID-19, there was, about 10.3 million local Kuwaitism and around 3.3 million expats.. Sorry. So now until now the 3.3 million expats, they went down to 2.6, and lots of companies that are, investing in, let's say, instead of paying big salaries for experts who are, handling critical position, they are sorry they are fighting them. So, that's why, we are having a big problem here is that there are some people who are not the fit between the qualified 200 positions. They are handling people positions and, banking, oil, and gas and so on. So, I think this is the biggest challenge here in the region. and they should take action immediately in order, let's say, if you want to, to make a localization and let people work, from, the local company, it's great, its amazing, but you have to set your people ready and do the proper training for them in order to be able to handle such key positions. Rouba: (12:01) Absolutely. you, you deal with the C-level leaders all the time, and then though it's taken, I mean, you mentioned it earlier that it's taken a while for everyone to take the whole threat of cybersecurity a bit more seriously, and that this has been kind of a common also amongst family businesses in the region, which are a huge part of the economy. So has it been really difficult first of all, to convince them, about the whole concept of cybersecurity and have you had to drop some of the stats, which to me are convincing for anyone relatively, like, for example, if you take the fact that 80% of organizations in the UAE, for example, reported at least one cyber attack in 2019, that's pre COVID and we will get to the post COVID era or during COVID, but how do the professionals that you deal with, perceive the whole impact, even the viability of such a threat, like cybersecurity, do they take it seriously or do you have to make the case for them? Roland: (12:57) Well, actually, I'll tell you something, in cybersecurity, you are either hacked and your know or you don't know, but in all cases you are already hacked. So this, again, based on the fact that there's nothing called 100% security, but what you mentioned about also the family businesses is really critical because, one of the biggest challenge here is when dealing with the people's mentality, especially the C-levels and decision makers of companies. One of the biggest challenge, I would say some of the challenges and the, how we should, how we can deal with them. One was the biggest challenge is that when they, when people tell us that, okay, Oracle got hacked, Microsoft got hacked, White house got hacked. So even my company can be hacked easily, and, there's no shame in this. So, we don't have any problem. So I don't want to invest in cybersecurity. This is one biggest challenge. Another big challenge  is that, most of the, let's say the big boss, I should have access to everything. I should have all usernames and passwords and so on, and so on, regardless if I know how to store them, regardless if I know how to use them and so on, which make things very clear because for someone to have a very critical information and access to certain service or whatever, without knowing how to source them and how to protect them. And, the third and biggest problems that we have nowadays is that when you go to meet certain company or whatever, or the, some executive level CEO or whatever, he will start by asking you, okay, what'd you have solution for cybersecurity. Again, it's like, you going to the doctor and tell him, what do you have medicine for me? So cybersecurity, it's not about you. There's no solution fits all, and we cannot say that, for example, for those companies, this is the best solution. Rouba: (14:47) I think the vulnerabilities are different, right? I mean, the vulnerable vulnerabilities of each company and their operation differ. Roland: (14:53) Everything is different. Everything is different. That's why we have what you call a cybersecurity management framework, which is first, we have to identify, what are we trying to protect before starting protecting. Like when you go to the doctor, he needs to check you first, you know, what is your case in order to give you medicine? So when it comes to cybersecurity, first, you need to identify what lot like to protect. Then we need to protect it. Then we need to set a monitoring tool in order to detect, when you are under attack, then we need to respond then the need to recover. So there is a continuous process that we to proceed and it on a daily basis. And that should be a, let's say a policies and procedures and regulations to know, let's say, when we are under attack, what is your role? What is my role? Because we all know that say if that if there is a fight into building, everyone will start running. If there is no, let's say, documentation on what is your role and what is my role? Nobody will notice and everything, everyone will, will be panicked. And everyone will start running. So, that's why, we always convinced, companies that, don't let perfection be the enemy of baptism before, because again, anybody can go inside your house and break your door and go inside and the steal house, okay, it's can  happen. But does this means that we will see by keeping the door open? No, for sure. We need to lock at and try to make this as safe as possible and to enhance our security yet, because again, I always give this example for the hacker he's investing time, and for him, time is money in order to hack your system. So if he will take him, let's say few hours to hack your system. It's so easy for him. If it was takes, it will take him few days. It will be more difficult. It will take him weeks. Okay. I will not hack the system anymore. It's too complicated. Rouba: (16:46) The COVID-19 pandemic helped with this. I mean, in a way it catapulted the whole digitalization of, even at like to the highest level now, all overnight, the entire planet transited into remote work. So using online collaborative tools, moderating entire operations remotely, and suddenly the need for storage analysis, data sharing became like an emergency again overnight, but along with that came, malware, ransomware hacking, cracking, and so many other forms of cyber breaches. This increased vulnerability of commercial and financial data in a way accelerated, the implementation of cybersecurity measures made it a bit more convincing. So for example, if you takefrom April to the end of June, more than 2.5 million phishing attacks were detected across the middle East region, what do you think makes this region more prone to cyber attacks, especially during a pandemic. Roland: (17:45) What Covid-19 medically here, especially inthis region lots of companies, they don't invest in their people. They invest in technologies, they invest in latest updates, latest firewall, latest systems and so on maybe, but they not invest in people. And when it comes to cybersecurity, it's just as much equal as to have a strong people well-trained and what our people have also cybersecurity risks. In addition to, investing, to technology. It has the same level, because as you mentioned, when I talk about phishing emails, phishing emails, it's targeting the individuals. It's not, when I'm going to hack a certain system on infrastructure, I don't try to hide the biggest firewall and the biggest, I don't know, a cyber security, protection they have in the system. I will try, I will try to hack the weakest point in this system, which is the human resource, which is the personnel that are working inthe system. And he had what he knows a debate between them as a CFO and a CEO. For example, we should invest in our team. What if, what if they left? What is their state? Okay, so what happened now after COVID-19 and remote work is that basically we used to have, let's say a, let's say a closed system inside the company where all PCs are protected from internally. No one can put a USB inside the laptop or whatever. That's secured internet. All our data are secured and our servers, nobody can access our data from outside our location and so on, and so on. Then COVID-19 came COVID-19 came everything changed. So we're not talking about remote work. Let's I about people working from their mobile or laptop from anywhere. So maybe they  jumping from an airplane and working. Okay one of them was for example, sometimes you have very confidential data that you need. You don't need to get access to those data from outside from the internet, but nowadays you have to, because again, if you don't give access to this data, to the internet, none of the employees will have access to it because they are working on it. And since you opened up internet, you expose those data for a public list. This is number one. Number two, when we are talking about phishing emails and phishing I would give you a very funny example that happened. I was in a seminar for, as a cybersecurity consultant for, President Barack Obama, between 20012 and 2016. They told us a case where, the whitehouse was under attack. So, they did analysis and they knew that that, that attacked started from inside, not from outside because of a human mistake. So, what they did is that they did a, phishing tests. They sent a phishing email to test how the how's that employee will respond to the phishing email. And listen, you are not talking about the region here. We're talking about  2000 employee in the white house, whereas they should be all experts hour and so on. So they sent them efficient email. And inside this image, they sent the wrote, please don't click on this link and say, put efficient link. And guess what? 95 OF the 2000, they already clicked on this link. Yeah. And as I mentioned, I want to mention, another, example, two weeks back, we went and a small cyber security conference for top executives in cybersecurity. I'm not talking about CEOs, I'm talking about a CIO, a CSO and so on and so on. So one of them were saying things that me, on a personal level, I was subject to click on a phishing link and fishing email Why? Because we all know that most of our work nowadays, while working on mobiles, while working on smart phones with a small screen where you can by mistake, click on a certain link instead of clicking on something else, this is number one. And sometimes lots of people they are answering emails and replying and working whiledriving, or while playing with the kids and so on. So by any means you can click on any link by mistake and makes the whole damage. So that's why that's what, what made the phishing emails very critical nowadays. And especially due to, COVID-19 not so on, people, they decrease that investment in training and awareness and so on. And we all know the effectiveness of training online is not the same as the live training and physical training. So, that's why the damage is becoming so, so, so, so, so big. Rouba: (22:23) And, and I mean, if we want to like, kind of wrap this one up, by giving or empowering, you know, the finance and accounting sector, I have, a dual question for you. So the regional cybersecurity market, is becoming very competitive and it consists of a lot of major players, some of which have been homegrown, some of which have come over, from Western markets and offering cybersecurity services. So my question here is, first of all, in your experience, must there be a dedicated function within private organizations or even government that are purely dedicated to cybersecurity solutions and prevention beyond the IT. So that's one fold. And then the second part of it, how do finance and accounting professionals who are definitely involved in this process because of the financial implications of data as well, being the most, the highest risk, how do they go about searching and actually recruiting the right partners? And what should they be looking for in terms of track record capabilities and services and solutions being offered? Roland: (23:27) Let me, let me be clear, regarding  the first question, when it comes to cyber security to you, the traditional ways that, cyber security was part and under the IT is totally wrong. And now we can see that most of the, let's say, especially in banking sectors, the cybersecurity team is  either under risk department or a dedicated department under the CEO directly. So it's really now the, people that are related to cybersecurity is very important because you cannot be, you cannot put the cyber security team or any cyber security expert under the IT department because he should be auditing the IT team. Like for example, are putting a, as a senior audit on the accounting and finance team, it cannot happen like this. Need to have, do you need to give power for a certain people to be, let's say, on the left, say this department or directly under the CEO in order to, be able to audit and govern all the solution, by done and implemented by, by, by  IT.This is number one, number two, regarding, for the finance and, I team him in order to know which pockets to deal with. And so on. I want also to be very frank about what's happening currently in the region here. What is happening now, nowadays, when it comes to cybersecurity companies, it's kind of unfair competition. Why? Because, when it comes to standards, lots of, government entities or private entities or whatever, they don't have the technical know-how to derive technical requirements for standard. And this is very critical. Why, because actually they don't know what they want. All they know is that we have, let's say a security features, we have problems, we have concerns, and so on. We need someone to provide a solution, but we don't, we cannot write technical requirements in order to say, we need something for, let's say, we need something for the hardware we need, whatever we need, whatever. Rouba: (25:31) But wouldn't that, then wouldn't that then be part of a kind of audit of the systems in question, by a cybersecurity specialist, for example, and then they would then make the list of, solutions required. Roland: (26:57) Actually this is how it should go. So we can not let say, for example, if, let's say this company took a ax solution from this company and a solution, worked very well and so on. So I can take the same solution and implemented, on my own. We need to do like exactly what you said Rouba. We need to assess what are our requirements, what are our needs, who are our team, what type of training and education and awareness we should have for our team, what type of data we need to protect. So I will give you one, one, one quick example on the, for example, let's say if you have a university, a website, okay. This university website it's can, for example, it can go down for, let's say one hour or two hours for maintenance purposes or whatever in order to do something. But let's say if you are talking about bank account bank website, you cannot take down the bank. So, your main priority for, for a website for a bank is that to keep it live 24 seven with zero downtime, because people will think lots of time, but why is the website down and maybe they are under attack. My money is not safe and so on. And so on us on, so you're the main priority when you're talking about bank and so on. It's stability, not taking anything down and so on and so on. Why, for example, in, let's say university, a website it's okay, it's fine. It's site go down for one hour or two hours or whatever. So there are different priorities based on different industries, different aspects and so on. So that's why, what is good for you? What is the frequencies of fixtures does not fix me? So this is very important. Rouba: (28:36) No, I mean, it's also amazing to see, like, despite the very and highly advanced kind of state of, of, digital penetration in this region, there's still so much education, to be done. And, and so I guess, you know, you have your work cut out for you. Roland. You have a lot of work to do. Roland: (28:56) Actually this is what they are doing, and, many again, when it comes to also training and efficient learners. We differentiate between two things. We have the technical training for the, technical teams up. There are, for example, the, IT teams, the cyber security team and so on and so on, but still we have awareness training, and as a basic technical awareness for everybody in the company from maybe the entry level personto the CEO, they should all know, for example, what you should, if you can click on this link or know how to protect your passwords, how to protect, because there are common mistakes that are still now that are being done by everyone, for example, like, and I, I don't want to call stupid mistakes, but for example, last password password, or one, two, three, four, five, and so on, they would write their password on a note on their mobile and so on, as they would use the same password across Facebook, Instagram personally made business email and so on because our, okay, I can't remember all the password, the password, like a birthday date or marriageit and so on, which is now many easy to guetand very easy to know. And, it would be very critical for the organization and on a personal level Closing: (30:11) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Ed Lam: https://www.linkedin.com/in/edward-lam-9b97258/FULL EPISODE TRANSCRIPTAdam: (00:05) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson, and this is episode 104 of our series. Today's conversation features Ed Lam, the Chief Accounting Officer at Exeter Finance. Ed is an accounting and finance professional who has seen many changes to the profession over the years. In this episode, he talks with Mitch about his thoughts on the future of work and how he envisions the role of the finance leader, evolving even more. From change management and continuous improvement to leadership and organizational culture development, Ed offers great perspective on what is needed to gain buy-in and succeed. Keep listening as we head over to the conversation now. Mitch: (00:55) So Ed to the kick off this conversation, can you tell us a little bit about how your job has changed in the last three to five years and then taking it a step further? You know, what do you anticipate kind of happening even more in the next three to five years for the future of work? Ed: (01:09) Yeah. you know, I'll basically, define the last three to five years in three phases. It's basically a stabilized standardized and optimized. So when I first came in, I think we had a, basically an under-resourced accounting group, without the right technology and, you know, basically, inconsistent processing. So the first two years was just looking under rocks and finding and identifying and addressing any risks and any, any errors in our process. So it took a little while, a lot of hard work, but I think we were always looking to kind of develop a stable and repeatable process and that just has to be built, over, over time. And, as a transition from fighting fires into having more reliable processes. So that was basically about year three heading into year four. But then starting, back in early 2019, we started to look for the opportunities to start optimizing processes and bringing on new technologies. So, you know, I think the optimized stage has been the most fun, just because you start seeing a lot more buy-in from the organization now that we built the trust and credibility, we need to basically, stack on, improvements in how we do things. So that's the, you know, for the last five years, just an evolution, it's been ongoing. We still have a ways to go, but we can definitely see the opportunities from there. So when we talk about the future, the next three to five years, I'd say over the coming years, my role, in directly managing my operations is going to continue to diminish actually. And that's the due to the strength of my staff and having efficient processes in place. So, you know, the focus then she has really a way from day to do day to day doing and managing, and just really a lot more on those continuous coaching and development. I've had to learn to embrace that a little bit, because it's a different aspect of being a hands-on manager. But it's actually a little more meaningful than, what I started doing, which was basically, giving bad news to my CFO whenever we found a mistake. Mitch: (03:32) That's really interesting. you know, you talked about optimizing and some of the changes to your role, obviously expectations of you the organization in general, but how have you been able to kind of change your management skills? Like you were just kind of talking about, but in a way so that everybody you're working with understands what the necessary changes are for the organization to truly optimize its processes and move forward? Ed: (03:56) Yeah, I think changing the management skills comes down to, you know, you go from, individual contributor skills, you know, and just being a subject matter expert in areas and basically telling people, you know, what the right answer is to basically focusing more on, encouraging communication and collaboration, and specifically outside of the department, because that's been a shift, you start off early on just looking inward and saying like, how can we, ensure that we put out a good product for our customers? But once you've done that, then basically the collaboration is a means of allowing you to influence the larger organization. So it does take a lot of time to build, those strong relationships with other groups, and that has to be encouraged. It's not just me talking to my counterparts and other divisions, but it's encouraging, all of the staff that part of the role is to not just give output to other groups, but to also communicate and understand, you know, why they need the things that they asked for. So, you know, again, taking the time to increase collaboration, encouraging that within, my org, and then supporting it and staying engaged with any change management initiatives. I mean, it's a way of basically, you know, evangelizing for transformation, right? So, you know, we're actually lucky to have a change governance committee at Exeter and that's something we can engage in where, anytime there's a change that impacts more than one division, it does need to get brought up through an intake process with change governance. So we stayed very engaged in that group, and it does involve executives and that's pretty important as well. So, you know, a lot of, how, I changed my management skills is just taking, any of those intake forms that has the potential for impacting my group or other groups that are aligned or adjacent to mine, and basically sharing that information in a meaningful way. Mitch: (06:02) That's great. I know any, conversation that we've had around the future of work and the changing profession, the word influence always comes up. So for you to bring that up again, you know, it's, it's right on target with what we're hearing, but I really liked the encouraging communication collaboration. That's something that I think will really stick, and truly shows the shift right, in the roles of the profession, the individual, is no longer just that contributor, like you said. So I think, some people who are maybe not as familiar with some of these changes, you know, they might have a little difficulty straying from the traditional, you know, finance and accounting work. And then the day to day that you were talking about the management style, how do you go about getting the buy-in from these different stakeholders in your department or these cross-functional teams across the organization that you're working with? What role do you get the team, you know, how do you get your team to really buy into this kind of new initiative? Ed: (06:59) Yeah, that's a, that's a great question. And, you know, one thing that you hear a lot of success begets more success, right? So, I think part of this is just attacking incremental improvements early on, and they can be very, very incremental. They could be small improvements, but you celebrate those accomplishments, and then also behind that consistently discussing what's next on our roadmap. We're gonna discuss roadmap from a little bit, but just the possibilities, and then periodically visioning kind of like the optimal state. So, let me give you an example. when I first started with Exter, our close process took more than seven days, and sometimes just to address like an issue or, you know, something that was broken, it could be up to 10 days to close the books. So, you know, with some of the technology that we've introduced, including a new general ledger and an account, sorry, loan sub-ledger, with a lot of the process improvements we put in place, including a close checklist and some management workflow, and the, obviously a lot of staff development we've been able to bring the accounting close down to consistently less than four days. Now that was basically incremental going from seven to six to five, I think two or three years ago, we were targeting five days now we're targeting three, but since last year I've been talking about completing the close in one to two days and eventually a continuous close. And that's the vision, that's a long-term vision, but you basically sell that once you actually have small successes and the team is actually open to more change. Right. And so team members are now seeing that that's a very achievable goal, actually. And, so this is about consistent visioning, not saying that, Hey, we're going to get there overnight. Okay. You have to basically talk about that when people are in the right frame of mind and then just being really earnest about belief in the team and their ability to get there. So I think that's worked pretty well as far as the buy-in, because I think all the entire team in Jays are waiting to kind of hear, you know, what's next, we're working on the 2021 technology roadmap. We're a little behind, but when that rolls out, I think there were basically write a sink, their teeth into it. Mitch: (09:18) So beyond these necessary changes, right. You just talked about 10 plus day close, obviously that that's something that needs to change, you know, beyond the necessary day-to-day tasks and things like that. I'm sure something that really, you know, goes along with success, begets more success is the culture, right. So how do you, you know, how do you go about building a culture around continuous improvement? How do you normalize change so that people expect this? You know, I know you're talking about a roadmap coming up and, you know, they, they're anxious to get into that because of the change, but how do you build this desire for improvement or in the whole culture of your team? Ed: (09:57) Yeah. You know, there's a couple of things, you know, and one of the first things that, I think about is making sure that you join an organization, that's open to basically cultural change. And that there's the potential for a cultural shift and that's kind of what stirs the drink. So, you know, I signed on to Exeter or knowing that it actually had the potential for that kind of like, you know, a significant change and transformation. And then you also need to make sure that the people on your team  are willing to learn new things. Okay. I mean, they don't come in saying, Hey, I've transformed organizations, but they have to be open to those possibilities. And, you know, it's a little tricky when you're in the interview process, that actually has to be something you seek out. But then beyond that, you know, we're lucky in that the change is kind of built into the evaluation processes. You know our semi annual evaluation is very similar to other organizations where we talk about core competencies are graded, but then also, goals. Right. And so, you know, obviously, you know, sort of competencies are, you know, are, are needed, to be in place so that you of consistent work quality, they reflect doing the job, but sometimes that's it, right. The goal setting is what's really important. Okay. With respect to, you know, changing the culture, you know, the goal setting is continuous, and it has to establish that there's always something new on the horizon and the, and then the right behavior then gets rewarded because obviously, you know, those are basically embracing those initiatives and, you know, up and down the chain in our org, okay. Even at a, junior staff level, there's always going to be goals that reflect changing or improving some aspect of their job. Right, and we focus on that type of behavior because if they do it right, then they get rewarded and again, success to get success. They basically embraced the next goal because they can see, basically direct alignment, right, with their career development, with their compensation and that ultimately the vision that we have for them. Mitch: (12:22) So along with all of this, you know, I'd be remissed if I didn't discuss the technological advancements that are being implemented, you know, across the whole profession. You know, and it's very hard to envision how that will continue to evolve, but, you know, if I could just ask you, how do you envision the role of a finance leader growing even more in the future, taking into account the necessary changes that you discussed? The technological changes, which we haven't really discussed, but we know it was a part of the role, you know, maybe not the day-to-day stuff, but the bigger picture sustaining this culture, continuing improvement, all that. How do you see your position becoming more valuable for the organization as a finance leader? Ed: (13:04) You know, and this is a little counterintuitive and it might be more specific to my experience at Exeter, but I built a lot of, functions, with them, my direct management, work. But then I ended up giving some of that up. So, so I think one of the lessons I've learned is building from within, but not being afraid to let go and so let me kind of tell a story around what happened over the last three to five years. And this relates to actually like the data and, technology transformation, which oftentimes I find that finance takes the backseat to operations with respect to kind of resourcing and prioritization. So when I started, I hired on a director of financial systems, that would basically act as kind of a project manager for all our finance apps. And then I also hired on a senior financial analyst that basically did a lot of like the data analytics, pulling in like, databases to provide the ability to, you know, do more analysis. And I grew both those functions, but as they became more successful and put on product that other departments and, that sectors notice, it really drew their attention. So, you know, over time, the director of financial systems and the team that she built, got annexed by the IT group, and my senior financial analyst got brought in under our strategy and BI groups, and both of those are outside of finance, but they were very critical players. They and their teams in the delivery of two transformational initiatives. One was our loan sub ledger, which basically takes millions of transaction records and captures in a database and automates the generation of all the journal entries we need to maintain our books and records, and this was developed over two and a half, three years, and then our new general ledger system, which is transformational, and that is a high capacity, low code, no code, platform, and it's allowed a lot of flexibility just within a general ledger functionality. Okay, so, you know, basically I, I started developing these functions with my group, and then I had to give them up to the, the, the functions and the divisions that actually managed you know, data and technology. But they basically in turn, gave me the mandate and commitment to serve the finance division. So it's no longer a function owned by me, but I'm now basically the primary customer. So, I guess, you know, when you talk about the role of the finance leader, sometimes it's not about having, a lot of FPE or, a larger, larger function. Sometimes it's about, um, you know, seeding the organization and then allow others to pick it up. And, I feel like I've gained more influence just by letting go of those functions and putting them in departments or divisions where they belong, but actually, you know, having those individuals that, I hired, showcase their competence, right. And basically kind of spreading, you know, a lot of the knowledge that they gain through these initiatives, to the rest of the organization. I think that's been kind of my role. I think it's just bringing the right people, giving them challenges to meet, and then at some point in time, you know, they can kind of share their knowledge with the rest of the org. Closing: (16:55) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession, if you like, what you heard. And you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

IMA Diversity & Inclusion: https://www.imanet.org/about-ima/diversity-and-inclusionD&I Toolkit Press Release: https://www.imanet.org/about-ima/news-and-media-relations/press-releases/2020/6/3/ima-unveils-diversity-and-inclusion-toolkitThe D&I Toolkit: https://www.imanet.org/-/media/1cb71380a29540f2af5aad35e04f2930.ashx?la=enContact Karmin Bailey: https://www.linkedin.com/in/karmin-bailey-0a849346/

Contact Matthias Tillmann: https://www.linkedin.com/in/matthias-tillmann-58997a53/Trivago: https://www.trivago.com/FULL EPISODE TRANSCRIPTAdam: (00:00) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson. And I'm here with episode 103 of our series. Today's expert guest is Matthias Tillmann, CFO of Trivago. In this episode, he speaks with Mitch about how COVID-19 crisis impacted the travel industry and speaks to the various crisis management plans he implemented to maintain operations. For an interesting discussion around business continuity, technology, enablement, and finance in the travel industry, keep listening as we head over to the conversation now. Mitch: (00:42) The COVID-19 crisis disrupted the global travel and hospitality industry immensely, and I know it affected everything from air travel to hotel accommodations. So in your line of business, what were the immediate steps that you took to ensure business continuity at Trivago? Matthias: (01:01) Yeah, that is right, the COVID crisis had a huge impact on our business. And let me start with giving you an idea of the magnitude of that effect, and just for context, we are an accommodation  meta search platform. So comparing price of hotels, apartments, vacation rentals, and other accommodations on this, so we're not active in the air space, for example. So while we run and operate over 50 countries, only a minor part of our business is in Asia and we have no presence in China. So when the virus first broke out there, we got an idea of what this could mean to our business, but we did not see it immediately in our numbers. That quickly changed when infection started to spread in Italy, end of February. Within a couple of days we lost all of our revenue in that country, and as the virus spread throughout, Europe first and then Americas, our revenue declined more than 95% year over year by end of March. So why, I'm  telling you this, we did not have much time to react. Our cost structure pre COVID was roughly 80% variable, which is predominantly marketing and 20% fixed costs. So  to preserve our cash, we first focused on cutting our marketing spend and on the performance marketing side, you can do that immediately as you just lower your bids  or stop campaigns altogether. On the other hand, on the brand marketing side, it is a bit more tricky. So we usually have part of our budget committed with certain TV channels, and you also need to brief the channels and commit budgets a bit in advance to go through clearing and secure the desired ad products, et cetera. So we started right away to cancel commitments and negotiated to post campaigns. And that was very important. As every dollar on TV advertisement obviously would have been wasted and might've had a negative effect as during a global pandemic countries and countries being in lockdowns. The last thing you want to do is to promote travel. So after we had taken care off of the 80% of our costs, we started to analyze our overhead structure as well. We are based in Germany. So as an immediate action, we utilized short labor, a government aid scheme where people work reduced hours and the government subsidized the salaries. This bought us some time to think about the implication of the pandemic, not only for us, but for the overall industry for the next couple of years and then we spoke to other industry participants to get different perspectives and try to understand how the action would impact the dynamics and all that occurred. And based on that, we formed a hypothesis around different phases of recovery. And by doing that, it became apparent that we cannot manage, through the spirit by just putting people on short labor, but we needed to restructure the business. That means reducing complexity, streamlining operations, and certainly also letting some of our talents go.As a consequence we closed or sold our remote offices and moved to everybody to our headquarter in Dusseldorf. And we reduced our headcount. but on the other hand, brought back everyone from, from short labor. And then lastly, I would mention that on the B2B side, we proactively reached out to our partners and implemented payment plans for those being in a difficult financial situation. And, that was very important because, at that moment we had a high amount of outstanding accounts receivable, but as we acted as a partner of trust and we collected almost all of the receivables, by the end of the second quarter, and as a result of all these measures, we did not burn any cash over six months period since the outbreak of the virus. Mitch: (04:59) So it sounds like you had to, you had to take a lot of steps upfront, but I'm just curious if you had any crisis management plans or any of these ideas in place prior to actually having the change the business. Matthias: (05:13) Yeah. We have operated in a very dynamic environment over many years and despite our global footprint and, a well known brand, we are still a small company, thus we always had to adapt change and innovate in order to be able to compete with large global companies. And this, I believe has fostered a very agile culture. So we always had to prepare for big changes and learn to stay flexible and adapt fast. So when the crisis hit, it did not take us long to adapt, and also, we also have a relatively simple business, with key leavers and product marketplace and marketing, and the biggest short-term, is clearly marketing. I mentioned it before. however, during, even during normal times, our marketing channels can be very volatile. And so we constantly reassess what we are doing there, and we always keep the flexibility to adjust quickly. So in a way we are at any time prepared for different scenarios, on the fixed cost side, our largest cost category by far is personnel and related costs. And, we are investing in people, thus we constantly have to evaluate how to allocate this precious resource. And when the crisis hit, we had to reassess our investment and projects outside of our core. And based on that, we came up with a restructionplan. So in a nutshell, I think we almost always operate, in an environment where we do have, a plan for all kinds of different scenarios and didn't need a specific one for this crisis. Mitch: (06:54) Well, that's great. And I know, you know, you've mentioned talent a few times now, already in this conversation, and I'd like to kind of talk about that a little bit further. You know, obviously you had urgent financial needs going into this crisis and you certainly had to adapt the business, but how did you really balance that with your desire to maintain the top talent in your organization and also, you know, address the concerns of the talent and the organization? Matthias: (07:18) Yeah, absolutely. So our first reaction was to focus on preserving our cash. and that means that we, cut all unnecessary costs and, came up with a reconstruction plan, as I mentioned, and have all partners with flexible payment terms. Internally we were very open-ended and transparent about this. So for example, we established weekly all hands Q&A's where we as management gave updates on our view of the industry, the implications for us and how we need to react. And the feedback from our talents was very positive on that, and I believe that the transparency about how we are approaching the crisis increased the acceptance of our measures. And, just to remind you that we had to take some very difficult decisions, like the headcount reduction. On the other hand, we clearly communicated as well that we will continue to invest in key projects and won't just sit, the crisis out. We do have a clear plan and product roadmap, and it is very important that all talents can look through the short-term challenges. Thus we have them to understand what we believe the long-term consequences will be by us continuing to invest. And in addition, we implemented several measures to help our talents, through this difficult time. So for example, we allowed them to take, office equipment home to have optimal working hours, working conditions from home, prepared the office to be as safe as possible for those who cannot or do not want to work from home, and organize different recognition programs, and as a reside of all these measures, we believe that our productivity even went up during that period, and then we, we spontaneously granted the whole company, one, one extra, mandatory, holiday week in August, what we called a true vacation. So that was also an initiative to show recognition and, to show that we are in this together, and if we go through this that our people were, would still get the benefits. And I believe those little things are very important, it shows that you care and there are so many ways you can give recognition that motivate the team. And in the end, we are still in a very exciting industry and it's important to, to remind people of that. Mitch: (09:55) So as far as continuing to invest in your talent, I like the different initiatives that you mentioned here. However, I assume there are still some questions about the industry in general, and I'll give you an opportunity to address that if you'd like, but just hearing some of the new increases in the virus across the world, and some new restrictions coming out again, I'm curious about the current status and really ultimately what you are doing to continue to maintain and potentially even attract new talent to the organization with all these questions looming. Matthias: (10:27) Yup. Very good question, indeed. And, I mean as I mentioned before, the beginning of focus was on restructuring the company. So we even had to let go some talents, unfortunately and that also meant that our recruitment activities were very limited at that time and we just focused on filling, replacements for key positions, but then during the third quarter, entering the summer season, we already saw a decent recovery in our business in particular in Europe, and we could clearly see that people do want to travel when it's possible. And we see a similar pattern right now in countries that are approaching the summer season like Brazil. And this gives us comfort, comfort that, when we will enter the peak summer season in the Northern hemisphere next year, again, that our business would decently recover. And those, I mean, those are answers to potential new talents and obviously, some were worried about, or still are worried about, the situation. And I personally received more questions from candidates on our view and outlook of the industry and Trivago's plan as a reaction to that. And then I have to say, we do have a clear plan and strategy, and we energize our company that also means that we adjust in the way we work. So for example, we are currently testing a hybrid working setup, giving talents a lot of flexibility, without losing the benefit of working together, collaborating and shaping our  new culture. And I think our talents and new talents as well, appreciate that. And just as an interesting data point currently we even get, on average, the same number of application for an open position, compared to the pre COVID time. Mitch: (12:18) Well, that's certainly very reassuring, for travel and I'm sure for many consumers listening, so thank you for sharing that. And, you know, the last thing I'd like to discuss here, as we wrap up, you kind of just talked about some of the numbers, you know, obviously in a strategic leadership position, coming from the finance function, technology and data plays a big role, I'm sure in a lot of the decisions you make for your company. So how has technology played a role in, and what kind of data are you really utilizing to make these informed decisions? You know, I know you just talked a little bit about some qualitative data and some concerns, so how does that go into it as well as the quantitative information, that you're taking into consideration? Matthias: (13:00) Yeah. So technology is obviously key to us. I mean, we consider ourselves a tech company, for sure and so when the crisis hit and our revenue went literally to zero, it was very difficult to come up with an estimate of what that means for the industry for the rest of this year, let alone 2021. So we started to talk to adjacent businesses and piece together, any information we could get and we also started the European Traveler Alliacez with leading travel companies, a project to support the local tourism industry. And the idea was to provide accessible data free of charge, creating a resource for consumers and enabling travel institutions and companies to deliver the information to the users across their own product, regarding any given restriction for chosen destination. So, that we, we formed a hypothesis that when travel recovers, it will be mostly local and we assume that domestic travel to nature destination would come back first, then city trips and international and business travel last. And hence we decided to use, technology to build a better product for our users reflecting, the shift. And the result is our Discover product that we ship in in less than six months. So it's now live globally in our app and on desktop, and as demand for travelers coming back, we will again use technology to find out how user behavior is shifting and we'll adjust our product roadmap accordingly. Another example is the shift from traditional hotels to alternative accommodations like apartments and we clearly see that in our data and hands are preparing to invest further in that vertical as well. So clearly technology and data key to drive all the decisions and, that, that is very important to us and, something that has us helped now, through the crisis to, set up, the product, and in a new direction and have our users, to get more out of that. Mitch: (15:11) Well, I certainly appreciate your perspective on all of this and thank you for sharing everything that you and your organization are doing. You know, I always like to wrap up conversations by giving you an opportunity to kind of share your thoughts or, you know, insights into what the future may hold. So again, as a, you know, the finance leader in the organization of a tech company, as you said, particularly with the challenges that you've faced over the last year, you know, what do you expect going forward for your company and even for finance and business as a whole? Matthias: (15:46) Yeah, sure. So I think it's two fold. On the one hand travel, we are optimistic and I'm personally, positive on the second half of next year, for travel, for the industry overall. And why is that? One is, we have seen this some already that, when people can travel, they do want to travel. And we currently see that again in Latin America where, they are approaching their summer season now, and we see a similar trend, that, people want to travel, even if there are shifts towards domestic travel, because you cannot go international, but when summer comes, people want to get out and want to travel, and, certainly we recently got the positive news on the vaccine. So it seems like we will have, a vaccine available, in the near future. Obviously distribution will take time and it won't have a big impact, in my view of what next year, but will be more important for the years to come. But even, even that shows that we are making progress. and it's not only the vaccine, it's improved testing as well and, obviously we now have all the experience of, what it feels like to travel under COVID restrictions. We all used to wearing masks and having a kind of precautions in place. So that will increase the acceptance next year. And we have one more year until the summer peak season to prepare for that. And, that I believe, will, positively, impact travel, demand overall. And then on the technology side, I think that's a development that we've seen right now as well where the crisis at rather accelerated it's very, very fascinating to see how technology can enable us and make things happen that think about like, even just before the crisis. Now we see a lot of companies are going into home office and it's working and it's working perfectly well. All that business travel that is normally happening, is only happening to a very limited extent right now, and companies, get the experience that through technology, they can do a lot of things that they thought wouldn't be possible. And, for us as a company as well, it's, on the products, actually, I mentioned the example of the Discover product, where we now had to use technology to come up with a innovative product idea to help users, address their changing needs, due to the crisis and that's a beautiful example. And then on the other end on the finance side, as well, we, as a company obviously are, are challenged. And, we have fewer resources now. I mentioned the head count reduction, and that means we need to become more efficient also in how we are set up in our finance function and one way to become more efficient obviously is technology. And then we also looked at solutions. Some things we would probably would have pushed out and, and still continue to do manually and now we are in a way forced to accelerate that process and use technology to have a more efficient setup. And, that's why I'm a big believer that there's a big chance and opportunity in every crisis, and I certainly see that in this one as well. Closing: (19:26) This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Liv: https://www.linkedin.com/in/livwatson/Contact David: https://www.linkedin.com/in/david-w-29627882/IMA's Paper - https://www.imanet.org/insights-and-trends/external-reporting-and-disclosure-management/a-digital-transformation-brief-business-reporting-in-the-fourth-industrial-revolutionFULL EPISODE TRANSCRIPTMitch: (00:00) Hey everybody, welcome back. This is episode 102 of Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong and I'm here to open up today's conversation by reintroducing you to Liv Watson & David Wray. If you'll recall, Liv and David joined us a while back to talk about business reporting in the fourth industrial revolution. Today we'll hear them talk with Adam about their paper on nonfinancial standards, digitizing transformation. Liv and David are leaders in the process of assessing the infrastructure required for the digitization of nonfinancial information, and they are here to share their perspectives with us again now. Let's head over to the conversation. Adam: (00:51) What does digital transformation of nonfinancial disclosures mean? Liv: (00:55) Thank you for the question here. What does digital transformation for non-financial disclosure mean is it's fragmented how people look at it, but let me try and put some perspective into it.  At the bottom or at the end goal, if we put it that way. We want auditable, traceable data. One truth to the data, and as long as we create data sitting locked up in proprietary documents or PDFs, there is a copy and paste process that is very human intensive and error prone. So what we really need is a digital transformation to create non-financial data and bring that into the same kind of environment where financial data is today, where regulator mandates companies to disclose XBRL as an open standard for financial information. And if you look today at a data captured from analysis, which used to be a cumbersome process from the U S Security Exchange Commission. Today, 89% of that data is captured in bots and becomes machine-readable data to automate analysis. So we need to take this whole non-financial data into a digital transformation, into a taxonomies ecosystem, where there are trusted available taxonomies for non-financial data. And it allows then also for companies to use this taxonomies is to improve their internal system so that you truly can create one truth to the data and link to multiple reports. And I know we will speak a little bit more about that later, but the regulators now are stepping out and understanding that non-financial data, sustainability data or ESG, however you want to put it, it's actually just as important to making economic decisions, but also policy makers wanting this to try and drive economies, to align with the global goals. So we need a data revolution. Thank you. Adam: (03:38) So that we've discussed what it means. Why is the digital transformation of nonfinancial disclosures, a burning platform need? David: (03:47) That's a great question, Adam. I'll answer it from two different perspectives. So firstly, as a working group member and then as a preparer. so let me look at the working group member perspective first. So despite the increasing attention in the role of sustainability disclosure, there clearly is a lack of trust taxonomies for non-financial standards and frameworks. And what this basically means is that the prepare of information is really limited in the way that they can access and disclose information against these nonfinancial standards as Liv alluded to earlier. So one possible outcome is that the data that's being passed from the preparer to the user, really risks being misinterpreted without contextual information being provided. So that results in restricted access potentially limited visibility and compareability of the information for the user. And ultimately it really hampers the uptake and growth of sustainability disclosure standards, which is not great. So a taxonomy therefore would go a long way to help address these issues by enabling a steady flow of machine readable, really comprehensive and accurate information for users to be able to make much more informed decisions. So now, if I look at this from the perspective of a preparer, the burning platform at its most basic level is the cost of compliance, and we talked about this in our paper, digital transformation, brief business reporting in the fourth industrial revolution, where we said that the international Federation of accountants or IFAC as it's commonly known estimates, that fragmented regulation really costs the financial industry sector alone 780 billion every year. Now multiply that out across all sectors and the numbers become absolutely astronomical. Imagine what we might achieve if we could spend that same money in sustainability areas. So think about education, equality, clean water so much would be possible if we weren't spending well over a trillion dollars on compliance costs around the world. Adam: (05:52) Then how do we practically propose to tackle these issues? Liv: (05:58) Thanks, Adam. At the heart of this, is that just like the rail road, right? If we only had rail cars without the railroads, those cars would not be mobilized. So we need an infrastructure when it comes to, digitizing non-financial data and what we truly need, and I speak a little bit about that from my, involvement and appointment to the European Lab steering group that was appointed by the European Commission to, look at what kind of digital infrastructure as well as what kind of standards should be mandated as they update their next release of the non-financial directive that impacts any company with over 500 employees that they have to disclose their ESG, to the market place. So Europe being a driver of this is trying to understand that this time around let's do it right. Let's not ask for more glossy, colorful PDF files that are totally unsustainable and not reusable, as David alluded to earlier. This task force is giving recommendation. We are currently in the recommendation stage and one of the things that we as a group have assessed, is the fact that we need a digital infrastructure with that. David also alluded to being involved with, I&P who he has created a task force which IMA is a part of as well, to be able to make that assessment. What kind of an infrastructure would that look like? So what do I mean by that? We believe that unless there is a central repository with taxonomies, for disclosure, for non-financial information that this taxonomy registry can help the standard setters to disseminate their standards to the marketplace in a digital way where software vendors and users can then take that to easily embed them to solutions and search engines so that we can start retrieving information and pinpoint this data looking into the needle in the haystack, as we said. So what is that mean? It means that there's digital taxonomy registrywill be a place for the taxonomy I mean, for the standard sharing to disseminate their standards digitally and also to collaborate, to start harmonizing the definitions around the metrics, because often your standards shared in the non-financial space as for the same metrics, they've kind of defined them differently. So trying to build that kind of harmonize station infrastructure allows for, digital transformation versus just an alphabet soup of taxonomies out there that will create, disconnection of the information. So we have had long discussion with this, and I think that there is a consensus now we're around the world that, a broader understanding of what that infrastructure would look like. It's now, brought to the forefront. So both David and I are involved with, writing this and, and bringing  consensus to the market. So we hope to come back obviously and shared with you what those outcome of this assessment is, but from a European's perspective, they are going to have a recommendation out early next year, what should the new non-financial mandate look like? And what is that digital infrastructure? And when you think about, the regulatory drivers in Europe right now is that they have something called the green, not the green, but a taxonomy regulation in Europe, that will go into effect in 2021 as well, which will drive asset managers to have to classify each investment and assess each investment over ESG, criteria as in the taxonomy to afford its impact on thee environment, and to start identifying what we call stranded assets, when are you going to face these assets that are actually negative impact? So when we start looking at these impact on both our profession, as well as impact on companies, this is no longer just about public companies or the big companies. A policy maker wants to bring the smaller company into the gym as well. So, it will be an interesting, evolution that we have coming because they never in my life seen all of the stakeholders coming together now and addressing the issue that non-financial data is just as important as financial, if we ever going to think about dreaming meeting the global goals. So yes, thank you for that question, Adam, because helping us getting the message out and getting feedback from the public on what a public good infrastructure for taxonomy would, would be, is very key to the success for this. And then as a board member of IMA globally, I am so honored to also represent IMA to this initiative. So I will turn it back to David. He might have some comments because we recently together went on the journey for two years to do research and then publish a paper on why this digital infrastructure needs to be there. So, David, would you have a comment that you liked that. David: (12:53) You know, Liv, I think you summarized it brilliantly. I think that you're exactly right. This journey is one that's long overdue, and it's not just from a regulatory perspective or a standard set or perspective it's from a preparer perspective and every other stakeholder involved in the ecosystem. So I think everybody is now coalescing exactly as you said around this consensus view, that's emerging. So it's really, really exciting to see this coming together. And I think the two of us have a real passion around transformative processes, but also moving to digitization and using technology to end up driving such positive change. So I couldn't agree with you more. Adam: (13:37) It's so great to hear that so many people are coming to the table and being a part of the conversation because it's in the past, you've had, you know, certain one group doing things and other group doing things, but having everybody at the table is just, it's really kind of exciting. but since this is a podcast for accounting professionals, how can the accounting profession support this important transformation? David: (13:58) It's a really good question as well, Adam. I think it's really important to acknowledge that as Liv and I are talking these transformative changes, not only affect entities and the wider ecosystem stakeholders as we just talked about, but really they affect people. So if we look at this from an accounting profession point of view, of course we need to adapt. There's no question about it. We refer to this in our paper as the paradigm shift in the development of future ready skills, but what does that mean? Well, in practice, it means that the accounting professionals really need to sharpen two fundamental types of skills as we move forward. The first one is greater emphasis on soft skills and here, what, what I mean by soft skills is really this idea of how we communicate better. It's leadership. It's about active listening, not just listening, but active listening, or effective listening. It's about collaboration. When we talked about this ecosystem, there are many different stakeholders with many different points of view and, and different objectives. You know, so it's about collaborating with, with those different perspectives. So people in the process that are not necessarily like-minded. That requires a skill to be able to do, and then other similar interpersonal skills are also essential. All of these things of course fit into and lead into business partnering and how we lead teams and how we manage change. So I think this focus on soft skill is absolutely critical, and one that, that needs renewed emphasis in. The second type of critical skill, I think is technology and data analytics. So of course, we're talking about digitization, we're talking about technology. So it goes without saying that this would be an area of significant focus, but it means really understanding more about emerging technologies. Like for example, what are the use cases for blockchain? What about machine learning or natural language processing or robotics, for example? So how do we take those as a profession and embed them into the organization in a way that makes sense? And these skills are clearly critical. If our profession is going to continue to advise, for example, our employers, our clients, or other stakeholders on what digitized solutions we should be looking at that ultimately will be fit for purpose. So how we digitize non-financial information is a great example of leveraging these skills, as we think about the most effective ways of communicating about the transformative change that we're talking about with interested parties, or as we think about the intersection, for example of technology process and people and digitizing non-financial taxonomies or reporting itself. Adam: (16:39) So if we look into the crystal ball a little bit, here's a quote from your paper, “Change is inevitable. The forward-thinking accounting and compliance professionals must prepare for changes and play and even more active role in data governance, the fast changing transactional and business landscape demands, fundamental altercations and the way we work”. So what does this statement mean for the each, for each of you. Liv let's start with you. Liv: (17:05) Thank you. Well, first of all, looking into the crystal ball, think about it, it isn't long since our profession is used to spreadsheets and now online and now cloud and those kinds of things, and I think that what is becoming clear is that the accounting profession, as David stated earlier, the cost of compliance or even cost of managing data has skyrocketed. As our profession, we need to become good data governance, not just domain expert and think about how data is used, repurposed and disseminated throughout this life cycle, so that we can, advisable have one truth of the data linked to multiple version. So my thinking of the skillset, but I also want to remember that I feel that it's more important to our profession in the future, and that is the paradigm shift over. It's not about disclosure, its the impact that we have as we move toward a more greener economies, right? So what is the impact and risk associated with companies because now, you know, just dealing with data that sits in your own system, if you're going to do scenario analysis, looking at external risk of carbon or, or, weather related, impact that can have, then you are now dealing with a lot of external data as well. So be part of the solution and, and adopt open data standard and, and become a good data stewardess and reduce the cost of data management, do not work in silos and sit there. In the future into the crystal ball, I see us very best suited as professionals. We understand that data. We need to understand the broader impact that this data has, and I think that we, as a professional, we can help management and communicate to stakeholders the value long-term value that the companies or the, that the companies do so more about what impact that this data and what positive impact can we help our organization have, and how do we meet those global goals, which are set for 2030, but when you start looking into the future, wow, the digital transformation and the power, I just see, us becoming, not data scientists where we can do programming, but what we need to do is be able to understand a much broader data set than the impact on the financial that we do today. And I think our profession is to involve to do that. It also needs to support that we can not just have this old way of looking at assurance like, yeah, look at it like shooting the wounded, going in after the war, we need to get more forward thinking and give good real time data assurance and monitoring embedded into these processes. So to me, the crystal ball is two key things that I want his audience to take away. Number one, our profession, we are the best suited to manage this and, and take control and help guide the companies, and second embrace the digital transformation, or you're going to be left off that train that just left the station. Thank you, Adam. Adam: (21:33) Thanks Liv. David, how about you? How would you answer this quote? David: (21:37) Thanks Adam. I always enjoy ending on a crystal ball note. It's always fun to do this. In addition to the two types of capabilities I just talked about as well as those so eloquently covered by Liv. There's another category. I think that plays a key role here and that's professional ethics and values. So governance is really premised in my mind on being able to identify risks and be able to apply really critical thinking to address them. So it means being able to, for example, be objective, be skeptical in some cases, and really challenge to make sure that what we're seeing is in fact, a single version of the truth that Liv mentioned earlier. So in reality, it means recognizing and prevents, preventing for example, lapses and ethical behavior. Particularly as we think about automation and the black box issues, right where the black box issue being one that we don't understand how it works. We only see the output, but that's not good enough. We have to understand how it works, because how do we provide any kind of guidance or assurance on whether or not it's functioning correctly? And of course it means that we also have to be able to identify and manage any kind of legal and regulatory requirements. As accountants, we have to have a sense for that particular area. It's not just allocated to the lawyers. It's very much to the accountants to interpret as well, not so much the legal issues, but the accounting implication of those illegal requirements. So of course the future is full of challenges and full of possibilities. And it's up to each and every one of us as professionals to seize upon it and make sure that we continuously develop the capabilities within our own toolboxes to do so. Closing: (23:29) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Kavya Ramesh: https://www.linkedin.com/in/kavyavramesh/IMA Life: Earn What You Deserve, by Kavya Ramesh: https://sfmagazine.com/post-entry/february-2020-ima-life-earn-what-you-deserve/IMA Launches Global Ad Campaign to Highlight How CMAs Make a Difference in Business:https://www.imanet.org/about-ima/news-and-media-relations/press-releases/2020/9/14/ima-launches-global-ad-campaign-to-highlight-how-cmas-make-a-difference-in-businessWatch IMA’s “The CMA makes all the difference” television commercials on YouTube: https://www.youtube.com/watch?v=Q9TUx2zNJuk&list=PL_PvlGddtOgFQUwJV7pWyXJoBox5f33Or&index=1FULL EPISODE TRANSCRIPTMitch: (00:05) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong, and today I'm going to bring you a bonus episode of our series. In this episode, we're featuring one of our CMAs Making a Difference. The CMA is Making a Difference campaign is a part of a worldwide initiative at IMA its goal is to showcase the many ways that earning IMA's Certified Management Accountant certification can set your career on an incredible new path, giving accounting and finance professionals access to exciting career and leadership opportunities. The campaign also tells stories of CMAs who are truly making an impact within their organizations, and in some cases around the world. Today, we're speaking with Kavya Ramesh, a CMA who is the co-founder and Chief Operating Officer of Techno Grow Analytics, LLP Techno Grow provides technology consulting services to the hospitality industry. Kavya is based in Bangalore, and she speaks with my co-host Adam about earning her CMA and the various opportunities it has presented. So now let's head over to the conversation and hear how this CMA is Making a Difference. Adam: (01:19) So can you share something specific that the CMA has enabled you to do? Kavya: (01:24) All right, so this might come off as a bit unusual, but for me it wasn't just the accounting part of the course, but actually the non-accounting part of the CMA that gave me an incredible edge.  It was strategic planning, decision analysis, risk management, investment decision-making, and to an extent, even the technology and analytics part that, helped me to broaden my horizon and to look for continued innovation and everything I did. So soon after graduating and passing my CMA exams, this is an interesting story, right? So I joined this company, as an associate consultant, and I was a part of their projects division. So I was involved in budgeting and financing projects from scratch. This firm operates in the hospitality sector, and while working here, I got the opportunity to explore a lot of operational aspects of the industry. So the above-mentioned concepts, right, that I learned from the US CMA, they drove a spirit of innovation if I could say. And I realized that I could bring a sort of change in the setup of the form.A new extort process, if you will, that could bring in a lot of change in the way the company operates. So while we were delving into this, I actually got struck by an idea that could in the very near future change the way the entire industry operated. So as a result of that, we have formed a startup today that is called Techno and Analytics, LLP, and I'm one of their co-founding partners. So our startup is basically in the process of free thinking and reinventing the role of technology in the hospitality industry. So we currently have a very diverse team working on our applications, and we're now ready to launch in the market. In fact, as I mentioned earlier, this is brought in our new marketing team and we're working on, how we can strategize our market entry. So all said and done, whatever the case may be, the ability to develop and conceptualize a new idea and to lead a team and to see it grow to this extent, all of this came to me, thanks to the CMA. Adam: (03:36) So I think it's amazing that you're part of a startup so early in your career. So what's that like being part of a startup? Kavya: (03:41) So I always knew I wanted to do something by myself that I could really connect to and I could make an impact with, right. So when we had this idea of, we jumped right into forming a team and all the process, every step, every day was a learning curve. Seeing that my day starts by working with 50 year olds, people who have seen generations together before I was born and seeing people my age step in and take the lead on the forefront of operations. It's been a great mix of people that I could learn so much from. And technology and analytics was something new to me. So while working towards the startup and these, the applications that we working on, I in fact, got to do a lot of up-skilling or cross skilling for that matter. So I took up some coding lessons. I took a few, designing because we worked on most of this from scratch. So it's like, it's like seeing a baby grow up, you know, infancy to say a toddlers is so far. It's been great every day, I wake up with a drive to, to see, you know, what this day holds for me. Adam: (04:57) That's amazing. So looking at that beautiful story that you just told, where do you kind of envision yourself in 5to 10 years? Kavya: (05:05) In the next 5-10 years, I envisioned myself as a happy leader who is devoted to serving causes that empower people around me. I see myself as the head of my startup that's on itself, great trust and confidence from the industry. I also see myself as a loving individual doing the best I can for everyone around me. On a personal note, I see myself devoting a lot more time of my day and teaching yoga. So a lesson on fact about me is that I'm a certified yoga instructor. So there's nothing better than seeing my students leave the class with a smile. So that's the way I love to begin my day. And I'd like to see myself doing more of that five years down the line. I think in the next 10 years, I'd have gained a lot more volunteering experience too, and what opportunities IMA would have for me then are only imaginable. And so I really can't wait to give back my most of this institution that has so wonderfully shaped my career. So my goal in the next five to 10 years is basically channeled all that I have learned so far into giving back. Adam: (06:08) What's one goal that you want to accomplish in your career? Kavya: (06:12) Alright, so my goal in courier and also in life is to have harmony. I believe that for all of us, there are three aspects of life, that make and break who we are and how we living. So these three aspects for me are health, wealth, and love. I would see my career as a successful one. If every day, all my actions are bringing harmony in these three facets of life, health, wealth, and love. I've given this quite a lot of thought since I started at university with the rights and CRT competence and motivation, excellence would follow. But what is that? What truly matters, right? For me, it isn't just the materialistic success it's and that's why my goal is to succeed in all these three aspects, have great health, create wealth and create love. And this isn't something that I look to achieve one day, the goal is to keep accomplishing this everyday in my career. And so when I see I've done this every day so far, that's when I feel a sense of accomplishment in my career. Adam: (07:16) That's wonderful. So then what's your highest priority as you move forward in your career? Kavya: (07:21) So my highest priority in life and also in my career, of course, is happiness. If that doesn't exist in what I do, then what I do, doesn't matter. To be happy and to be able to share that happiness with all the stakeholders I interact with, be it, my family, my peers, my friends and colleagues, or even my clients for that matter is what makes me feel fulfilled. It's also what drives me to do better. So here's the thing, right? I do this exercise when things don't make sense to me, I close my eyes and I take a five. I think about, what I'm feeling right now and how I exactly want to feel. And then I think about how I got here and all that led me to reach this place. And once I have these answers, there's this huge sense of gratitude in me. And I'm back to work with a smile. So as young professionals, we usually prioritize a lot of other things over happiness, but I'm of the opinion that it is actually a quintessential priority. So yes, happiness is my highest priority in my career. Adam: (08:23) You've done some amazing things and you've shared some wonderful stories. I wonder if you could share, who is your role model and why? Kavya: (08:30) Oh, yes, I do have a role model. My father is my role model. So he is so because he's the one who taught me to think for myself. He taught me to understand all the things I could be and above all to be kind and grateful. All the ambition, the genius, If anyone sees in me, I owe it to his endless encouragement and guidance. He also led me to know I can do more of my life then just working a job. And he showed me that quality life means to nourish and to grow with every passing day. So I wouldn't be this and say what I'm saying right now. If it weren't for him, Closing: (09:11) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard. And you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Dell Ann Janney: https://www.linkedin.com/in/dell-ann-janney-at-c-sc/Contact Wendy Tietz: https://www.linkedin.com/in/wendytietz/FULL EPISODE TRANSCRIPTMitch: (00:00) Welcome back to Count Me In IMA’s a podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong. And this is episode 101 of our series. Today's conversation includes my co-host Adam Larson, Wendy Tietz, and Dell Ann Janney. Wendy and Dell Ann are two academic leaders in accounting, higher education. In this episode, they discuss the high flex teaching model, which has gained value in popularity, following the recent educational and economic environments around the world. Keep listening to hear how high flex teaching is being implemented and can be used to help accounting education. Adam: (00:45) So let's start by defining what is high flex teaching? What is the high flex teaching model, and how has it affected the accounting classroom? Wendy: (00:53) So I'll answer that. The high flex teaching model gives students a choice of how to attend class. So they're going to be able to attend face to face,  traditional classroom, or they can attend during class time online and to be able to see what's going on in the classroom or the screen, and have a chat room to communicate with and/or video cameras and microphones. And then the third option is allowing students to view the recording at their own time. So that's the high flex model teaching like that, giving students the option and with this pandemic that really comes in handy to be able to accommodate all the student needs, and at my school I've been doing high flex for about 10 years because I teach large classes and this has worked very well for us. It's especially nice now. I'm not, we don't have the face-to-face option in the large classes right now, but we're still operating under that same mode. And I know Dell Ann has been in the high flex model. So Dell Ann. Dell Ann: (02:03) Sure. So last May, when, if we go back to May, when the spring semester ended and all classes went online and students were taking classes remotely, I think that all academic leaders began to contemplate what a fall semester would look like. And Culver Stockton College is located in a rural area, and at the time we had no cases whatsoever of COVID. However, we have students from all across the country and even around the globe. So we anticipated the likelihood that students traveling from more populated areas would arrive and land in quarantine or isolation. So as we began to plan, we decided that faculty needed to prepare to teach both face-to-face, but also allow those students that are in quarantine isolation to attend synchronously online from luxuries of their gorgeous residence halls. So some faculty would have students that were unable to attend completely due to the COVID illness and thus would record their class session for those students to watch the video asynchronously at a later time. So this approach is referred to as high flex. Adam: (03:22) So, and I know you have both different, schools that you teach at and they are different models, but what are some of the challenges you've encountered with this teaching model? Dell Ann: (03:34) Well, the challenges are many. We can start out with equipment. So in May, we began to determine that faculty would need to bring in their own lab laptops into the classroom, in order to zoom, the, the faculty would need Zoom pro accounts, they would need external web cameras, headsets, and stylists and pad in order to stay at their computer to, to teach their classes. We had all classrooms reconfigured so that the chairs were all six feet apart. That was pretty crazy. In fact, there were a lot of our faculty leaders who were going room to room to rearrange and ensure that that the rooms would actually accommodate the number of students that were originally assigned to it. So for example, our chapel, which normally seats 200 students, ended up becoming a classroom and was re reconfigured to seat 30 students in it. One of the other interesting changes that we made was that all students would be required to sit in the same seat for the purpose of contract contact tracing,and so faculty, we actually created seating chart, which felt very elementary school. And although the students are six feet apart, we still felt that that was important to be able to verify. So I would mention that actually ends up being a pandemic positive if there are any we'll, we'll count this one, because those seating charts have been really a win, not for the purpose of contact tracing, but more so it's really helped the faculty to become much quicker at learning names. So I think the combination of faculty, of the students sitting in that same seat, each class period, and then having the seating chart to glance down at and learn their names, it was definitely a win. I think another challenge was the sanitizing. We felt that as the students entered, we would expect them to sanitize the desk upon their arrival and at their departure. So faculty really needed to monitor and ensure that that happened. And probably one of the biggest challenges with the students that were in person in the classroom was of course we do require all students to wear mask. And it's often difficult to hear students through their mask when they were speaking. Now, the challenges with the students that are online synchronously probably was getting them to participate and keeping them engaged, you know, certainly the opportunity for them to just log in on Zoom, turn off their camera and then possibly head back to bed and fall asleep was pretty good. So, and occasionally of course there were the dreaded technology, wifi issues for students attending via Zoom. As I previously mentioned, we're a pretty rural area. So there are students that live out in the country with limited internet access. And I think from a teaching perspective, probably one of the biggest challenges was staying in front of the computer at all times. So that the camera was on you not being able to write on the board. I'm a very animated professor. So when I'm teaching, I'm moving around, I'm helping my students and all of this makes it incredibly challenging, especially when you're trying to help a student with an Excel issue and you're trying to stay six feet away from them. So the, the last challenge I'd mentioned would be really no breaks. We consolidated, we removed every single break from this semester. So students definitely felt that you could see it in their eyes, and certainly for the students that were here in person, as it got into week eight and nine, that you could just see in their eyes, how stressed they were. So I know that the students needed breaks, and I think I could say that our faculty needed breaks as well. Wendy: (07:46) Okay. We had some of the same challenges. Our classrooms were equipped with, cameras that would follow faculty moving around the room. So that was over the summer. That was a nice add on. We also have got camps in every room and every classroom has the same exact, equipment layout so faculty could go,.Of course, my classes with hundreds of students, are not being held in person. Anything above 50 cannot be held in person. So we're just doing the online. But I would, thinking back to when I started doing high flex several years ago, high flex, it's certainly harder to engage students, whether they're in front of you, whether they're online with you or whether they're watching the recording. So you always have to keep those three modes as you're teaching, as you're designing the class, because the class isn't like a face-to-face class anymore because you have these multiple audiences. So engaging students is definitely more challenging. You also need to somehow incentivize attendance in some way, because like, Dell Ann referred, that students could log in and go to sleep, or students will say, I'll watch the recording, and they have the best intentions in the world of watching the recording, but it comes Saturday night when it's due and something else comes up and they're like, Oh, I'll get it next week, and won't watch it, and so the class, because it is so flexible gets deprioritized. So we have to communicate that this is important and have to incentivize it some way. And then the other big thing is to don't assume students know how to use the technology natively, because I found in many cases, students don't know what they're doing, even though we think, Oh, they're young, they know what they're doing. So we do have to address that is so that everyone is able to use the technology and not make that assumption. Adam: (09:50) I'm sure many of our listeners who are listening, whether they're faculty or not, if you're a parent of grade school children, you've seen these challenges, watching your children try to, try to attend, school, remotely, as schools have opened in many ways. So I'm sure everybody can relate to a lot of those challenges, but now that we've discussed all those challenges, what are some ways that we can improve this, this method of teaching? Dell Ann: (10:14) So I think that having a streamlined effort in terms of having the students come directly in ensuring that they are sanitizing on their own, giving them clear directions of expectations is so important. The second factor I would say would be to create a more streamlined process for those students that are online. We of course, are using Zoom and setting up a Zoom recurring meeting so that you're not recreating that invite every time was really helpful and creating a redirect tool, which is an app in our learning management system. Copying that Zoom link invitation and providing it in that same spot in the learning management system, navigation menu is really valuable. Then the students know exactly where to go every time when they're online. I think requiring the students to turn on their video cameras is really critical. And I know that for a lot of reasons and there are a lot of great memes out there with the dog, that's got the really bad looking scruffy do versus the dog that's been all groomed, you know, asking them to turn on their video cameras. I don't think is that much. I know we discussed it as a faculty and the academic leadership, and actually the administration said, Oh, we're not going to make a policy on it per se, but rather allow the individual faculty members to kind of set, this is what I expect, and then certainly allow a student to have a reason if they did not. But I think, you know, using Zoom virtual backgrounds is another easy win, to just ensure that you're not looking at their childhood bedrooms and, you know, such when they're for those students that are already back at home. One of the big changes that I made and actually did this a year ago is that I, I began using a game-based learning platform in my intermediate accounting class. So in the Fall actually, 2019, I started creating Kahoots for every chapter in intermediate accounting. Part of the reason I did this was because of the students, smartphones are such a distraction and it seems very junior high, high school to tell them, you know, please put up your phones. So I began using Kahoot and created a Kahoot for every chapter in my intermediate accounting class, and I literally teach using Kahoot. So it's basically forcing them to answer a question every few minutes. Now Kahoot does actually let me insert teaching slides so I can pause the quiz feature to do a short two minute mini lecture or talk over a topic, but it really turned out to be a big blessing this year, because again, it's a game format. So it's constantly quizzing the students to keep them actively participating. But I found that the students that were online via Zoom would also participate in the Kahoot quite easily. And it was pretty cool to find out that some of them, you know, from whether it be their residence hall rooms or from their, their home, that they would even score higher than some of the students that were in the classroom. So I can say I was just incredibly excited to see that they were actually engaged in the learning and competing in the Kahoot. Wendy: (13:54) Okay, I'm going to jump in here. I use polling questions in my class. I use a combination of polling questions and Kahoot, and let me tell you why, why they're different. With Kahoot there is no way to trace a student's name. And when I talked about incentivizing attendance, one of those ways is to say, well, let's answer polling questions during class. So I use polling software that does collect the student's name and their score, which is basically did they participate. And I use polling questions much like Dell Ann does to engage with students to gauge how they're understanding, and, the poly software I use can also be used in an asynchronous environment. So if you attend my class live, you're answering polling questions throughout class. Those polling questions can take the form of multiple choice, word clouds, fill in the number, just depends. We're doing how those questions are asked. And then we use, we also use Kahoot. I use it as an optional review activity for exams. So I think Kahoot is a wonderful tool. I'm just dealing with a larger population, so I have to be able to track them some way. The other thing that we do that's different is we do not require video cameras, I guess, we are the other, the other side of the coin, there's a very compelling argument for both sides. We tend to be more concerned about students not having equitable access because some students may not have the bandwidth to support video. The students who are attending asynchronously don't have the option to have video on, and some students don't have a place where they can show video. So we do not require video and I guess that's me, some instructors could, I guess. But I haven't found it to be a problem because I've gotten used to interacting with the chat room. So I focus very much on that chat room, and I'm currently using Microsoft teams meetings for class, and we have a chat room going all the time and we start that chat before class even starts. So before classes starts, I'm talking with the students in the chat room, I'm asking them they're typing back, but we do a lot with, memes and gifs before class starts. And then I always start class with a chatroom question, like, how are you doing this week? Or, did anyone see any movies this week or anything like that just to get them loosened up and starting to talk. And the chat room works really well combined with polling question. The other thing that I think it's important to do when you’re designing the class, if you are going to be teaching in this high flex mode is to design the class, to give students, an intrinsic reason to attend class. If you're just going to get on Zoom or Team meetings or whatever, and lecture, that's something that can easily be done in a recording and they can watch it on their own. So you have to think about when you design your class, designing the engagement into the class. So not only do we have polling questions, but we do things like, Dell Ann mentioned where we do Excel assignments in class, and when I'm doing the Excel assignments, I'm pausing and stopping and asking if they have questions so they can do the Excel along with me and I can give them real time help. So I think that's important to design the class with engagement in mind, how's that engagement going to work. And then finally, when you have a high flex model, you still need to support the high flex model in an asynchronous manner with discussion boards. So that students who are not able to attend the synchronous class, have some way to chat back and forth with each other and with the instructor. Adam: (17:51) That's great. So, and we can tell from all the things you guys have been saying that, you have varying levels of, experience with high flex. What do you wish someone would have told you before you started using the high flex teaching model? Maybe there's things that people can avoid, pitfalls that you've run into, as they probably are, have been getting into it this first semester, if they hadn't even started in, back in the spring, like you did Dell Ann, what are some things that you wish somebody would have told you before you got started? Dell Ann: (18:18) I think that probably the biggest pitfall truly is, and Wendy mentioned this as well is just keeping those students engaged. You know, they're in their rooms they're in their comfort zone. They're near probably at least on our campus. Their rooms are very small, they're in a bed potentially. So I think knowing that it's maybe too comfortable, it would be beneficial to know, and to acknowledge that you really, you know, you have to ask them, these are set expectations, tell them you expect them to get out of bed. You expect them to get dressed, comb their hair, and for us, turn your camera on. It's going to indeed set the learning environment, making it much more effective. And for me, I really am, I can't stress enough that being able to do those Kahoots and seeing my remote learner participating as well as my students that are right there in person to see them engaged and participating in class has been really, really beneficial. Wendy: (19:29) I would. My biggest piece of advice is to communicate often and frequently with students about how the class was going to work starting with before the semester even starts for this fall. I emailed my students in early July, and I followed up with an email about every two weeks after that, just to let them know what to expect because students right now are very, insecure and are worried and they have all these different classes going on. So I think communication is key, frequent communication, and then they may not get it the first time you send it because they've got lots of things going on. So just following up with communication and being flexible. Right now, we need flexibility in the classroom more than anything. So maybe your students don't fit in the standard box, or maybe they need to be told something 12 times, but that's how life is right now. Closing: (20:28) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Rachael Bertrandt Crump: https://www.linkedin.com/in/rachael-bertrandt-crump-cpa-cgma-303b057/About Rachael Bertrandt Crump: https://www.insight.com/en_US/about/management/rachael-bertrandt.htmlLeadership Article with Rachael: https://profilemagazine.com/2020/rachael-bertrandt-insight/FULL EPISODE TRANSCRIPT:Adam: (00:04) Welcome back for the hundredth episode of Count Me In IMA's podcast about all things affecting the accounting and finance world. Once again, I'm your host Adam Larson, and I'm pleased to introduce the featured guest for today's episode Rachael Bertrandt Crump. Rachel is a Global Corporate Controller and Principal Accounting Officer for Insight, a leading provider of computer hardware, software cloud solutions, and IT services. In her conversation with Mitch, she discusses what it means to be a global leader, the importance of culture, and how to develop top leadership talent. Let's head over and listen to the full episode now. Mitch: (00:44) So our conversation today revolves around a leadership article that you wrote earlier this year about being a global leader, to kick off the conversation. Let's first start by getting your definition of a leader. You know, I'd really like to get an idea of who it is that you see as a leader or who can be a leader in the organization, and then particularly for this conversation, we're going to focus on global leadership and global organization. So what does all of that really mean to you? What does that look like? Rachael: (01:12) Sure. So to me, my definition of a leader is anyone or someone who's driven to influence a particular outcome. So really in any organization that can be anyone who has a passion or a drive, around a particular topic, or to achieve a particular outcome. So if everyone can be a leader, right, and an organization just isn't what we might do in our nine to five or how we interact during that work time. I'm a firm believer that, you know, we're training our future leaders, in all of our organizational units today, in our family units, and our schools and the volunteer work and everything we do. And those are, those are our future global leaders, global citizens. So it, it's almost  most important that everyone who steps up to lead is their leading, where their passion drives them to. I think that the diversity and experience that everyone brings, is really what, what kind of brings out passion in someone. And, and that's what makes a good leader to me. Mitch: (02:30) Well, I really liked the fact that you brought up, you know, home in school particular. Just my personal background, I actually come from classroom teaching before I started this. I was working with students and coaching and, you know, I think a big part of that growth in an individual is the leadership that they see on a daily basis. So now from our perspective, you know, obviously more professionally, the organizational culture will certainly shape a leader as well. So I'm curious, you know, how exactly does that happen and can culture affect an individual's ability to be a leader, particularly globally? Rachael: (03:12) I absolutely believe that that culture, impacts leadership. I think it can propel leadership forward, kind of that Lightspeed, if you will, but I also think the wrong culture can stifle would be leaders. particularly if they have less direct leadership experience and they're looking to step into, you know, a leadership role, whether it's, you know, official or unofficial. They can lose confidence if the organization and the culture doesn't embrace diversity and experience. I think that, you know, maybe many decades ago, experience was measured mainly, based on jobs months, years, sorry, days, months, years in a job and now I think there's a lot more that defines experience based more than just on kind of the time in the seat or the time in the job and I think it's that, you know, that diversity of experience that really gets about how global organizations can be so effective today. Someone coming into the workforce today that, and I use myself as an example, you know, went to the same university in Wisconsin, got the same degree I did, you know, few decades ago. Their experiences actually entirely different than mine. Their context, how they learn the tools, the office tools with which they learned on, and that puts them at a different starting point than it did me, and that experience just because, you know, I've been in the workforce, then maybe I've learned my tools on the job. Doesn't put me, you know, necessarily at an advantage, from a leadership perspective over what their experience might have to offer. So I really think that that is, you know, important in our global organizations today, that we acknowledge the diversity in experience, and how people, how people achieve experience in what we define as experience, because I think that's what really takes, an organization to the next level. And culture has to embrace that, right? I mean, culture can be a whole other  podcast, right. But, you know, culture really has to embrace diversity and to draw it out, to draw out your, your future leaders, because I mean, if we don't, if we don't train ourselves, train up ourselves, right, we're going to be in a, I think a world of hurt, we'll be at a disadvantage, as an organization. Mitch: (06:01) Well, you certainly make great points, and I think the one thing that I want to emphasize is, you know, there has been a shift in what someone's experience is, you know, you mentioned that the time piece of it, and I think a lot of businesses today are recognizing that certain skills certainly differentiate, applicants, regardless of, you know, how many years they have on the job, but to your other point, you know, culture, it certainly has existing barriers still when it comes to leadership development. And while, you know, there might be a shift in mindset as far as experience and skills and whatnot. What are some of the other barriers that you think are really affecting these organizations? And then what is hindering individuals from reaping some leadership development from their organization? Rachael: (06:52) So I tend to believe that that we ourselves and our unconscious bias is one of our biggest barriers to effective global leadership. We have to think bigger than our own, you know, kind of universe right in the moment. And that can be super fun, mindblowing, but it can also be a bit overwhelming. I also think desire and passion have to come naturally. I believe every human, you know, it, they have it for something in their life, but it, it  they have to feel it and want it for it to come out, and kind of break through their own natural barrier. And then, you know, kind of along the same lines, we're, we're our own best advocate and our own worst enemy, maybe. But other barriers showing compassion and empathy and being vulnerable. So when you think of global leadership that the people that you are leading likely are, you know, very, diverse geographically, across many different regions. And, and so you're serving them as a leader and you're not in there, you know, you're not in their seat. You don't know your day to day in your region likely looks very different than their day to day in their region. And so really being vulnerable and having, that empathetic view for what they, you know, may be going through, I think really makes a difference as to whether you'll be an effective global leader or not. Mitch: (08:33) And then, you know, obviously ideally these individuals are able to develop their global leadership skills. You know, organizations recognize, as you said, the unconscious bias, or maybe there are, you know, other avenues to really taking advantage of, leadership development for their employees. So what are the ultimate benefits that, and why should people be so focused on overcoming these barriers conscious or not? You know, as far as internally, externally, personally, anybody who's involved with the organization, what does strong leadership really do for the organization and its talent? Rachael: (09:11) Yeah, for sure. I believe strong leadership builds an organization to be resilient, for what's to come in the future of that organization. There's, there's lots of variables in our daily world, particularly in global organizations. So having that strong leadership to build the base of trust, that helps you deliver today and, and in the future as an organization. You know, becoming better global citizens with more awareness is, is really, you know, where strong leadership can help play in. You know, it's interesting, as, as we kind of work through in a day to day type of scenario, I believe that, you know, everybody plays a leadership role in it's almost conversation by conversation, and you know, you don't, you don't always agree a hundred percent. There's not, you know, a hundred percent euphoric kind of level that you get to. But if you have that trust and that strong leadership, you can step back and say, look, now I might, I might not agree with where Sally or Fred is going, but they have the best interest of the global organization in mind, you know, the teammates, the shareholders, whatever that organization serves. And I trust him so I can get behind I'm in, might not have been how I would have, you know, kind of set out to do it would have been my initial response, but because I trust them, I'm going to get behind their idea, and, you know, the more, the more that you have that the further the organization can go at a faster pace. When you think of the global scale of operations, I, I mean, it's just almost a 24 hour clock, right? And so if you, if you don't kind of have the majority of, of the teammates and of the organization going after the same, kind of outcome you could really stifle. And so I think that's, that's where strong leadership really comes in is, is building that foundation of trust and, you know, getting, getting the whole organization behind, behind a similar objective. Mitch: (11:37) I really liked that response, and very often we have these leadership conversations and trust is really the foundation. It's the word that comes up so frequently when we talk about good leadership. So I think that's really important to point out. And, like I said, I really liked that being able to, you know, just trust in somebody and listen to what they have to say. So I think that leads us nicely into kind of just this last question I have for you. You know, when you are seeking to build this trust, or you want to develop leadership, you want to develop the leadership skills of others, you know, really improve the talent within your organization. How can confirms go about doing that? What can organizations do so that they are constantly developing a leadership at the top, but then also the future leaders of the organization? Rachael: (12:27) Yeah. So I think a couple of things there, you know, look around to organizations you want to emulate and, and don't just look at what may be an exact pure organization, because maybe that's your differentiator right? In your marketplace is, could be your, you know, your leadership, approach in your organization. And so if you look, just, just look around and see what you, you know, want to be like from a leadership perspective. I would also, on a global basis considered cultural training. You know, there are business classes at universities around the world that, you know, really we'll spend a whole semester on cultural training within business. So find one, that sounds interesting, reach out to the professor, you know, see if you can bring them into your organization for a day or, or, or a few, however, that looks. But most important to me, is to handle internal development, look for your leaders internally, at insight, we refer to each other as teammates, and we believe teammates are our biggest assets with the highest rate of return. And so make the investment in your teammates and you won't be disappointed. I think you'll enhance the trust factor, and, and it'll help propel the organization while you're building your future leadership base. Closing: (14:03) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession, if you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Andrea Williams: https://www.linkedin.com/in/andrea-williams-201a9a12/FULL EPISODE TRANSCRIPT:Mitch: (00:05) Welcome back to Count Me In. IMA's podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong, and this is episode 99 of our series. Today's conversation features Andrea Williams, Senior Vice President and Controller at Perdue Foods. In this episode, Andrea talks with Adam about the future of accounting work and the ethical challenges management accountants need to be aware of as their roles continue to evolve. Let's get over to the discussion and hear more about the topic now.   Adam: (00:40) What do you see as the differences between management reporting and financial reporting?   Andrea: (00:45) Well, financial reporting certainly has to follow all of the accounting roles that we were trained on as accounting professionals and those roles continue to evolve over time. Management reporting should certainly follow all those rules, but normally management reporting looks at slices of the business and targets insights into subsets of the financial statement. And so it's really important for the management accounting teams that are preparing that information to keep the financial reporting in mind and certainly tied to it and every possible way that they can, but to recognize that they're peeling the onion and that they really need to be careful in how they represent those pieces, that they would still represent what is in the ultimate financial statements. In our business, we have, we use management reporting for certainly for what I  would call, accountability reporting. We provide levels of reporting for all layers of management, from folks that are running a subset of the production floor all the way up, of course, to the executive. And we also provide reporting that is targeted to certain functional areas, you know, the sales teams and the marketing teams and the, the critical aspect of this is that as management accountants, again, we need to really be sure that ultimately these are subsets of the financial reporting and be really careful that we don't mislead folks as we're just providing their slice of the pie.AdamSo how do those differences, provide some additional ethical challenges that management accountants need to be aware of? Andrea:Well, providing the multiple views, doesn't always easily coalesce, into the total. And so an example of that is, we actually provide, what we call sales value of production to each of our plant facilities. Sometimes they like to call them income statements. We always correct them and say, no, this isn't an income statement. This is a sales value of production. And the critical difference there is that from a production perspective, they're interested in understanding a margin related to products they produce that week or that month or that quarter, even. And of course we are as many businesses, we don't sell out everything that we produce in a particular alignment with a financial week or financial close, and so consequently, we are put in a position of bringing in what we call a representative sales value. It may end up being more or less than what we ultimately realized as the invoice value. And so where this becomes an ethical challenge is that, of course we have algorithms that go out and choose what sales value to use, for example, that's based on history. And so everyone's happy to use that sales value when it, when we're in a rising market, unless happy to use it when we're in a declining market or in a business that is impacted by some commodity values. And, that becomes, can become an ethical challenge because obviously you can't play both sides of the coin and because it isn't, tied to invoice sale, we get into very interesting conversations with our production folks, and we all just need to remember what was the point of what we're trying to represent and be as honest as we can with the business and ourselves and what we're representing.   Adam: (04:35) Definitely. So, you know, you're kind of referring to how, you know, things are constantly changing in the industry and all over the world, and obviously we're still in a pandemic that's happening. how have you seen like the management accountant role evolve over time, especially with all the, everything that's been happening?   Andrea: (04:52) Well, in the most recent day, I would say the, just like everyone else, we all have to learn how to work from our homes, where we were traditionally more used to being in the offices or in the plant, the plant, buildings. So certainly our technology skills have had to improve and our collaborative skills, you know, building  itand, you know, as everyone in the world that seems to be doing as our zoom meetings. So that's in the more recent, the more recent days of how we've had to evolve. I would say over time in my career, there's really been an evolution of what the management accountants are expected to do. When I started, the roles were very, closing focused. The closing calendar was paramount. We, you know, work through task lists that were either leading to, or coming out of closing cycles, and it was still very much, an accounting role. And although we still have those responsibilities, our business partners really, don't expect to live and die by a resource that is connected to closing calendars, and consequently we've had to smooth out our tasks, and actually provide information in a more consistent basis every single week. And then some, some cases every single day. That is not really impacted, by the strict financial reporting. And what that means is then we've added to our plate, a significant amount of what we call estimates. We do a weekly estimate, all throughout the entire business of what we based on information that, you know, certainly happened in that prior week. But, you know, we're making, you know, educated guesses of what something will actually realize based on education and history and foresight and those types of activitieswe're not anywhere in the role when we, when I first started. And so then that's transitioned to not just, you know, that's still looking backwards, and so in the last several years, of course, then now we're being asked to look forward and providing, much more of our time is providing information of what we believe will happen, not reporting on what has happened. That's a significant shift and it requires, um, very demanding skills on, on accounting folks, very different than, you know, the traditional auditing skills or traditional just financial closing skills.  Adam: (07:39) For sure. So you, you know, you've described kind of how the roles evolved for that you've seen over time, but where do you kind of see it going in the future?   Andrea: (07:47) So, interestingly enough, I feel like the profession's at a crossroads. A  crossroads being that, are we going to continue as management accountants covering both roles? Are we going to continue to be the ones that, you know, shepherd the books and really make sure that things are tied out, in addition to all the analytical demands, or are we going to split into separate groups? That one group is handling the accounting and one group is deeper into the analytics. I've seen that certainly some of the other bigger companies as they, as they create separate FP&Agroups. and I feel like I'm seeing a trend of that, that's more and more what's requested, certainly at the, at the bigger, at the bigger companies. And so what happens there is that then how do those teams work together? We see additional rolescoming in for folks that, are more data analysts. I would say, and their background isn't necessarily accounting. Certainly the folks that we've been hiring are more IT related, but instead of a management accountant, attempting to cover all those bases themselves, they're becoming part of perhaps a bigger collaborative team where there's an IT skill set that's coming in that, you know, working with these big data pools and using, you know, increasingly new tools to access more, concrete data, and then collaborating with folks that really do understand the accounting and how things need to come together and can represent a, you know, element of this is absolutely the truth of what has happened, but then, enhancing that with skillsets of these folks that are more analytical in nature that are more closely aligned with the businesses and explaining what has happened and also being able to do that forecasting part that we talked about earlier.   Adam: (10:02) So with that evolving role that you just kind of described, are there additional challenges that could impact ethics with as the role evolves? Because you know, with new roles comes new opportunities, I guess.   Andrea: (10:16) Well, I agree, and I think there's the additional ethical challenges are that anytime that you are springing away from reconciling to something, you know, is absolutely true, then you are moving out on a, on a journey of, potentially being influenced to represent information that is not as true as maybe it should be. You know, the closer that, you are subsetting information or filtering information and not being required to fully reconcile it back to a base that everyone agrees is facts. It really poses ethical challenges for folks. You can filter, you can take a big data pool and filter and tease it out to say what you want it to say, if you're, if you're not careful and if you don't have the right, guardrails in place. I once worked for a, a plant manager and he, you know, would be frustrated sometimes. And he would say, well, I really, I really wish that you were more of   a statistician sometimes than an accountant. And I, you know, I asked him, I'm not sure if what you mean by that. And he said, well, a statistician knows that you're supposed to provide the data that I'm looking for an account and always wants to provide the data that actually is true. And so I was like, Oh, well, okay, I'm glad I don't fall into the statistician description then, because I'm not comfortable with that. But, you know, especially when we are mining this data and perhaps folks that are, you know, using greatly expanded tools are doing it, you have to be really careful of, you know, what, what was put in and filters. What was the ask, especially if, if, when you bring that, that answer back, you're not making, you're not absolutely making sure that all of the pieces add up to the total. There's, there's some risks there and some ethical challenges in making sure that it is done properly.   Adam: (12:22) Do you think in this world of big data, that there's going to be more people wanting to look for that person to be the statistician  since there is so much more data at our fingertips?   Andrea: (12:32) I hope not, but I think that, you know, when we all have to watch out for, as accounting professionals and, and even a professional, working on an collaborative team like that is that one, the business decisions that will, resolve from what this information is provided can be really critical to a business. So you, you would hope that everybody is in it for the same mission that they want to, to realize the best information possible, but sometimes that those activities can also be used to report out on how business has done. And that's where you really have to be careful because, in many cases, those subsets are linked to people's incentives and their bonuses, and as soon as you're touching someone's results that relate into an alignment with their pocket book, you have to be really sure that, you know, the information is buttoned up and that we have the right safeguards in place.   Adam: (13:35) So what advice would you give to management accountant who's listening to this as they consider their own future?   Andrea: (13:41) Well, I would say that, still really important, the fundamentals are really important. Understanding in a great variance analysis, understanding and keeping up with the financial requirements as they change over time. Those fundamentals never change, and it shouldn't be overlooked, as we're, as we evolve in our careers. I think that the other part that is really actually exciting for the profession is this opportunity to work more closely with the businesses and become more and more and more that business partner that sits at the table, and is part of this conversation of where do we go from here so much more exciting to being in those roles quite honestly then, and just the roles that are talking about what has happened and reporting out on what has happened. So to, someone that's working on their career now and thinking about how can I get from maybe a more junior level into something more senior. What I would say is, certainly work on your skillset and work on it from a, from the fundamentals. Like I said, the certifications, making sure that you really, you know, know the core of your profession, but then also spring from that. And, you know, read, you know, read, read read, you know, we have great accounting publication to keep us up to speed, but I would say, you know, we need to be accessing all of the business resources we have. The Forbes magazine and The Wall Street Journal, and, you know, acquainting yourself with the world of business. Don't stay in your little silo of your own company, or, through an experience because the more that you understand about how business works in a, in a greater global setting, the more valuable you will be to the business that you're working in now, and also more valuable to perhaps the business that you would like to move to in the future. It's those folks that have a curiosity and a desire to really understand where the world is going are the ones that are really, you know, springing ahead of their peer set.   Closing: (16:00) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Nicole Gonzalez Cumberbatch: https://www.linkedin.com/in/nicoleggonzalez/IMA's Commitment to Diversity & Inclusion: https://www.imanet.org/about-ima/diversity-and-inclusionFULL EPISODE TRANSCRIPTMitch: (00:00) Welcome back to Count Me In. IMA's podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong and this is episode 98 of our podcast series. Today's episode features a conversation between my co-host Adam and member of IMA's Diversity and Inclusion committee, Nicole Gonzalez Cumberbatch. Nicole is a senior accounting professional with over 17 years of experience. She is an advocate for leadership and mentorship, and in this episode, she shares some strategies for the working parents who find themselves juggling various priorities on a daily basis. This timely conversation is helpful for many accounting and finance professionals who find themselves working from home and looking for some tips to better balance their time. So to hear more action that you can take, keep listening as we head over to the conversation now. Adam: (00:52) So Nicole given the COVID pandemic, so many of us parents have found ourselves in a unique environment of juggling our careers and family without substantial caregiver or employer support. What impact has that had on the workforce? Nicole: (01:12) Well, Adam it has had a tremendous impact Obviously, economically, you know, we see change drastically due to high unemployment, massive lay-offs companies going out of business. So in that aspect, it's, you know, working parents are now out of work, right? Trying to figure out how to support their families. But on the flip side of that, for working parents, especially with young children, it's been extremely challenging just recently. I read a New York times op-ed that said, there was a quote that said, “You can have a kid or a job. You can't have both.” And I was like, Oh gosh, that's so, you know, that really, I think summed up a good portion of the last seven months. And then just briefly to kind of pivot, and I know you're a male and I'm a female, not trying to be biased, but more specifically female working, working parents only because in general women are the ones who kind of run the household and they were usually the ones that stayed at home. So another statistic I have is that it said, according to this benefits platform called Cleo, one-third of working parents have already left the workforce, and that was from July, do or gone part-time due to COVID related reasons, and 70% of those parents were women. And the reason why that affects the workforce is because as I previous, previously stated, women were usually the ones that worked from home, the mentor, their breadwinners, the ones who worked out outside of the home, and you know, where the support system for the family over the past 10, 20 years, women were joining the, joining the workforce at tremendous numbers. I think recently it said it was like up 50% and equal to men in the workforce. So now we're seeing a setback of that, right? So you see women going back and having to choose. And if that is 70% of women back in July, we're in October, you know, so I'm assuming that the numbers have either have probably more so gone up, and I guess the bigger question is what does that do for the future? I know I've read articles that say, some women will not be going back because there's so much uncertainty with childcare and not having support. sSo it's, it's had a tremendous impact, and I think it's actually frightening, for what the future holds, you know, working parents in general, again, had to struggle with before the pandemic of trying to find support and balance and, all of those things. And now even more so in trying to find childcare amongst the pandemic, when, who else can watch your children, but yourself. Adam: (03:50) So what are some actions that parents can take, you know, to work through and to be better prepared during, as these challenges continue to come up, because as we see it, you know, the pandemics not really going away as, as soon as we all thought it may be. Nicole: (04:04) You know, I think first off, I think you have to surrender and accept the fact that this is what it is. And that's, I think important in all things of life, right? You just got to kind of surrender to it. I think it's kinda ingrained in us that we want things to go this way, especially as a parents in general. You know, we may want our children to act a certain way or we want to react this way, but that's just not life. And especially during a pandemic, as I'm sure you've seen and myself, you know, things just arise that we can't control. So surrender. Next I would say, adjust your expectations, allow yourself grace for the chaos and imperfect reality that's going to ensue, like we just know that's going to happen and allow for flexibility. you know, I think it's important again, as parents in general, but more so when you're trying to work from home and, and be a caregiver to your children at the same time, like you just have to allow yourself that grace and know some days are going to be more chaotic. Some days are not going to run smoothly and you just have to be okay with that. And then I would say aesthetically, you know, make sure that you have a comfortable working space for yourself and for your children, if they are, you know, doing virtual school, if you have a younger child turn on your TV and Disney plus, you know, just kidding, but no, you have to find ways of maybe creating spaces for them that next to your desk that makes them feel comfortable that mommy and daddy are right there, but they kind of have a comfortable space. And then just a few other things I would say, create a routine, this way you and your child goals kind of know what the day is like, as opposed to just waking up and be like, Hey, what's going to happen today. Make sure you have the right equipment supplies and honestly ask, ask for help. I think one of the biggest things, is again, prior to the pandemic working parents had these issues of trying to balance and finding childcare and all these things and get proper time off, and now in the pandemic everybody's having these issues. I think men are seeing the struggles women have had of trying to run a household and work while the children are kind of there. You know? so I think it's had everyone kind of slowed down and realized like, Oh, wow, this is a thing, this is something that's major. So I would say, ask for help, you know, whatever that, whatever that is, you know, that you need, but ask for help from your employer, your village, your community, and go from there. Adam: (06:34) Definitely. I mean, because there's so many new challenges and you kind of have to be flexible. That's the kind of the thing I kind of centered it on is like being flexible because not only do you have, you know, kids working from kids doing their school from home, but then they also have projects that they need to do and you have your work that you have to do and you have to kind of balance it all You have to be flexible and not only do we have to be flexible, but companies have to be flexible with their employees. Like, Hey, this person can't come to this meeting at this time because their kid has something that they need to help them with at that time, and they need to be able to be flexible in that as well. Nicole: (07:06) Yeah. And I think the struggles with the smaller companies are probably the biggest thing, like some of the biggest bigger companies, and I'm sure we'll get into what companies are kind of doing this quote unquote the right way. but I think that's a bigger challenge in smaller companies, right? When, if you're, if you're, in a position that you wear multiple hats, you know, and you're really the kind of one that does just this job and this job, you can't really rely on someone else because it's you, but that's why it's even more important for companies ,to kind of have certain things in place because we are all kind of all going through the same thing, you know? Adam: (07:39) Do you have some examples of some things that companies have done to kind of step up and support working parents during the pandemic? Nicole: (07:46) Yes, and you know, for my research, it's been a lot of the bigger companies again, right? The Microsofts, the Googles, Target, Salesforce, Uber. I mean, I can go down the list of these larger companies, but again, they're larger companies. Some can say they can afford to have certain things, and you know, a lot of the policies, which is actually crazy to me are policies that should have been again, instilled before the pandemic. But a lot of it is, extending paid time off. There was one company I saw this actually was allowing their employees to take a sabbatical and that they would pay them up to 20% of their salary to take the sabbatical, to take time off if they needed it. I think it was actually a tech company, gosh, I wish I had written down the name, but I'm sure you could probably Google, like company that offers sabbatical, but really it's just creating expansive benefits packages like the increased time off, flexible work hours, childcare reimbursements for the ones that do have some childcare, options available to them. But really, and truly it was just showing support. I think it goes a long way for a company to say, we see you, we hear you, we understand you and we're here for you. And if I can say, to any, you know, CEO or HR director out there is really, that's the biggest thing that an employee wants to hear. And I think you can have these high level, benefit packages, but really, and truly it's an employee or going to an employee and saying, what can I do for you? Because maybe childcare, isn't your issue. Maybe you just need a mental health day. Maybe you just need a day to say, look, I need time for myself. I needed a mental health day today. I was going to take a half day for this podcast. And I was like, you know what? And then to take the full day, I'm going to send my son to daycare and I'm just going to use a time for myself. So it's really as an employer recognizing that and having the relationship with your employees so that they feel comfortable enough to come to you and say, Hey, I need, I need this from you. Can you help me with that? Adam: (09:49) It's almost like being, they need to be open to, more requests and they need to be flexible as well, because there's going to be things that we're all going to encounter that they haven't had to address before. Nicole: (10:00) Correct. You know, it's interesting. I wrote an article for aStrategic Finance that was published March 1st and I had just thought about it cause I was like looking at the publishing date and it was specifically related to supporting working parents in the workforce in general. And when I went back to it and I wrote that, gosh, probably January, February published March right before all of this chaos started, and a lot of it was just the same stuff that we're talking about. I mean, some of it was mainly like being in the office, but it was that support being flexible, allowing for grace from your employee, paid time off for working parents. And I think also not making, an employee fear, fear losing their job, right? The stability and knowing like, if I need this time off instilling in them that look you're okay. If you need this it's okay. and I think that's another big thing because when employees do want to ask for the help and you're afraid that there'll be a repercussion for it. Adam: (11:02) So let's say you are a company and you're a leader in that company. You're like, okay, are there some effective policies and strategies that they can adopt to help these parents feel supported and empowered during this time? Nicole: (11:16) Yeah. You know, I think it goes back. A lot of it is just being, being supportive. It's increasing work, pay time off, it's increasing flexible hours. I mean, I think in general, that's what has had to happen right? Only because of people having technology issues and trying to build, or, you know, trying to build a work from home atmosphere, you know? So I think companies have had no choice, otherwise you wouldn't probably have employees, you know, of having, you know, implementing some of those, flexibility. But I think really, and that's what it comes down to as far as effective strategies and policies is having open communication, showing support, allowing for some flex time. And even if you are a small company, I think there's ways to be flexible in saying, okay, well maybe if I can't pay me, I can't give you a robust, extra eight weeks of paid time off. I can maybe let you take off on a Tuesday, Wednesday, and you can make it up on a weekend. Like there has to be a communication though,and I think that's like the main key is just communicating what works for your employees. Maybe have a survey and say, Hey, what are you guys needing? What, what can we do for you? And again, in my research, that's just what a lot of these companies are doing. They're having these open door policies, they're making their employees feel comfortable to say, Hey, I need help. And this is what I need from you making it okay to say, I do need time off without fear of losing their job. and that's been the most, the biggest thing. I know for me personally, I was, I, I was home with my son for about three months, but having to go right with it started the pandemic and home with my son and had to go into work because it was such an antiquated system that we had. We were not able to work from home and it was at the height of the pandemic. And I was freaking out because I'm like, Oh gosh, I have to go into work. Even though it was kind of by myself. But there were still people going in and out. My son is two and a half at that time. So I was freaking out and I was just like, I, I can't do this, and luckily I went on FMLA and I was off for about a month or so before my son's daycare opened and we felt comfortable sending him back, but that's like my little snippet of story, and I'm sure there's hundreds out there, including your own of you trying to figure out what am I going to do with my children and how I'm going to balance work. and I eventually ended up being laid off from that position, which worked out. But I do believe it's because I chose to take the FMLA to be with my family, but I was like, I'm sorry, I have to choose my family over anything else because it's what's important for us right now. Adam: (13:53) Definitely. It almost sounds like, companies are actually having to,, they're almost being forced to do what they're supposed to do, which is put their effort into their employees because there's many studies that have shown that if you put that effort into the employee and make them see that they're valued, then their production as an employee goes up exponentially for the company. And they're actually having to do that. And the companies are actually seeing like it paying off when they do that. Nicole: (14:23) Correct. A hundred percent. I think that's exactly it. It's things that should have been done for the longest of time, things as simple as increased time off or flexibility, working from home, childcare possible reimbursement, all these things that have kind of been floating out there that some companies are implementing that again, people are realizing, cause the whole world had to stop and say, Oh wow. You know the labor for, even though we have essential. And obviously that is, you know, we have our nurses and our doctors and our policemen and all of that. But the workforce in general of these companies being like, wow, if I don't support and we don't, then we're not going to have a workforce, especially for the ones who are working parents and are trying to juggle the two. So I think it's correct. It's forced them to kind of basically have no choice, but to implement some of these things. I think there's also studies that have shown in general when you have enriching or enrich, PTO plans that, you know, employees are more apt to be more productive before they leave to go on vacation because they want to make sure everything's done correctly, etcetera, so that when they come back. So it's the same kind of concept, you know, had my previous job just a lot, and all I asked for was flexibility. I'll come in on the weekend when my husband's off, like I just needed some flexibility. I was like, I'll take a pay cut. Like I was like something and they weren't willing to work with me. And I think that's where it goes of. Just ask your employee what they want. I didn't want to not work. I just wanted flexibility. So to your point, correct. I think employees have had employers have had to realize this is what the new norm is. And I do believe if there's goodness to come out of this is that, you know, companies are adopting these, these plans to support working parents now and in the future. Adam: (16:12) Definitelyk and I feel like the many companies who are against working from home have seen, Oh, wait, it can be productive when we can have people productive at home, and they can have kids at home and be productive and still get things done. So it's really changing the mindset of, of, of companies as we move forward, and I think it'll, I think in the end, like you said, there can be some good that comes out of this horrible pandemic that we've been in. Nicole: (16:37) A hundred percent. I mean, obviously it's still related to what your position is, what your job is and what you do. But yes. I mean, I know people that say, yeah, even though working from home, they might think an employer might think, Oh, but you're going to be lazy and maybe do a load of laundry, but employees have said, yeah, but on the flip side, I'm also answering emails now at 6:00 PM or 7:00 PM. So you're actually getting more out of me because instead of me having to do an hour commute to the office and an hour commute home and being a little bit more mentally drained, right. I can get up, start my computer at seven, o'clock get the day rolling. So again, you know, I think, yeah, and I think statistically, we will see that. I think we will see overall. And of course there are exceptions to the rule. we will see that it's, it's benefit a lot of companies of having people in and seeing that companies are working from home. I know many businesses are not even investing in opening more offices, so they're actually saving money because they're seeing that people can tela-commute or, you know, work from home. So yes, I think overall there will be, there will be some good that comes from this. Closing: (17:44) This has been Count Me In IMA's podcast, providing you with the latest of thought leaders from the accounting and finance profession, if you like, what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Eli Amdur: https://www.linkedin.com/in/eliamdur/Email Eli Amdur: eli.amdur@amdurcoaching.comEli Amdur Website and Contact info: http://eliamdur.com/Eli's Blog: http://eliamdur.com/index.php/blog/FULL EPISODE TRANSCRIPTAdam: (00:05) Welcome back for episode 97 of Count Me iIn, IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson, and I'm happy to bring you our latest episode on the work environment and personal development, Eli Amdur, Career and Executive coach, Journalist, and Keynote Speaker, joined my cohost Mitch to talk about recent business decisions, what they've meant to those in the workforce and what individuals can do to best prepare themselves for the future. I'm sure you will enjoy this conversation. So let's go listen. Mitch: (00:34) What is your perspective on the current business environment and how would you rate businesses in their response to the COVID-19 pandemic? Eli: (00:51) Mitch, good question. First, let me say, thanks for inviting me here. I'm happy to be with you and your membership. Current business environment, for sure, it's unlike any we've ever experienced. It's, it's being, it's being influenced by as many serious, conditions as has ever existed together at one time in an  economic meltdown, massive job losses, COVID-19 social and racial and gender unrest. We're doing, we're experiencing as much as we've ever experienced before. What I'm afraid of is knee jerk reactions on the parts of employers, entire industries, even government agencies, but it's, it's natural, but it's something that I think is way overboard. For instance, the thing about working remote. Well, we didn't have a choice on that. We understand that. And having technology that permits us to do it is a pretty awesome thing, but companies already having said that we're going to work remote until 2022. They're getting out of lease deals, they're selling office space. I think they're making decisions that one day soon, they're going to be kind of sorry, they've made as, as suddenly, and as, I should say thoughtlessly as they have made them. I don't think enough thought has gone into it. Mitch: (02:37) Well, what are the potential outcomes of these decisions? You know, it's something you're afraid of. It. It might be a little thoughtlessness, but you know, as far as businesses and their sustainability longevity, why might these decisions may not be the best ones for the business? Eli: (02:52) That's a, that's a great question, and I think it's because we're reacting to things we can see immediately. We're not holding off on our decisions. You know, I'm very fond of saying, and I've said this for many years, going way, way back to like corporate leadership roles. That if we thought about the consequences of our decisions before we made them, we would make better decisions. So yeah, COVID hits and we got to get everybody out of each other's ways. Otherwise the transmission of the disease will be increasing, which it is now anyway, as you know, but the things we can't see are things that have now become a little clearer to a lot of people, both workers and leaders, and decision-makers in organizations. And that is that we're missing the interpersonal connections that we so very much we rely on and enjoy during our work days and our careers. We are social creatures. We rely on belonging to groups. In human history, those groups have taken all kinds of shapes, like a corporate division of religion, a fan club, a, a community we need that. It is one of the most basic of all human needs. Abraham Maslow pointed that asked to us very well. Once we get done with our physiological needs, for food, clothing, and shelter and things like that, and our longer term security needs the most basic need of all his belongings. We're missing that, people are lonely. They don't like being alone. They want to be part of a team where somebody slapped somebody on the back or shakes hands and  nods approval in a conference room. And those, the lack of those things tend to decrease the effectiveness and the efficiency of performance, but not, not enough companies are realizing that yet. There's still an element of their technology and their ability to work remotely. Mitch: (05:00) Now, obviously there are circumstances that are preventing businesses from reopening and people being able to gather in the manner that you're discussing. there are going to obviously be those who have their concerns going forward. Long-term so what can businesses do? How can businesses accommodate the needs of the human being of their employees, keeping in mind their safety, most importantly, but also being able to offer this human interaction and this gathering so that they may be able to feel slightly more accomplished and, and achieve all the benefits that you previously mentioned. Eli: (05:37) Well, let me answer that two ways in the very, very short term, nothing. We've got to continue doing what we're doing, because we don't have a way to prevent this disease, and we don't have a way to treat this disease. And with the spikes that are going on predominantly in the United States, more than any other country, now we're headed into the third wave and winter time, it's, it's serious business. We're going to have to sacrifice something and that's our belongingness, our togetherness, our interaction. So in the short term, until there is a vaccine that is safe, effective, and plentiful, because we don't know if it's going to be a one time, or if you have to do a second booster, we don't know that any of that yet. Until that time, there's just very little we can do other than continue to reach out remotely as much as we possibly can, but go longer term, and I can't tell you exactly what that long return is. It's going to be six months from now. Is it going to be eight months? Don't know, but I can tell you that there's, there are indications that companies have already realized this. Recent news has shown that in the world of big tech and I referred to the big four, which is Google, Amazon, Facebook, and, Microsoft have taken up new leases on a couple of million square feet of office space in Manhattan. So they apparently have given this some thought and Facebook is a company, but that early on in this pandemic said that they have that their employees could work remote until 2021 and 2022, but they're buying up office space. I think they know what's going on. Maybe they're getting good deals because of the situation, but, they're going to be calling employees back into work, and I think they understand the thing about the consequences of their decisions. And so I think what companies can do is to let their employees know and their vendors and their customers as well, we're not running away, we're not going to be a one 800 don't bother me.com type of business. but that they are indeed intending to get back to working closely together and to strengthen the interpersonal bonds. If I were to advise corporations and not just big tech, but all corporations, that's exactly where I would go. Mitch: (08:11) Now, how about logistically more specific to our audience? Right? We work for accounting and finance professionals at large, you know, their role was already changing prior to this pandemic. And then you add the remote aspect to everything, you know, their jobs have shifted. What can you recommend as far as, you know, accounting and finance professionals, accounting and finance organizations to, you know, best again, accommodate these needs while maintaining the safety of their employees? Eli: (08:41) Well, couple of ways to answer that, and I'll try as hard as I can. First of all, much of the work that an accounting and finance professional does, can be done remotely. We know that. But if you're working for a firm, whether it's a small bookkeeping firm or a very large accounting firm, you still need that interaction, and I think what the companies, the employers can be doing in advance is to plan for what that  is going to look like when we do get back together again and let their employees know in a very transparent way, what they have to look forward to. One of the, one of the characteristics that I'm seeing when I talk to employers, when I talk to employees, when I talk to people who have been furloughed or laid off, or just completely dumped out on the street, or people who are working productively is that there's an atmosphere of being forlorn employers need to be able to assure their employees, that this is not the way it's going to continue to be, but why we're doing what we have to do, let's just do what we have to do. I think that's a clear message. And I think that there are very few people who wouldn't get that message, because if we're always together, we feel better about it. And sooner or later, we'll get back. Look on my, on my career coaching, when I wear my career coaching hat, I can tell you that since April 6th, when this thing really took hold, I've had 34 clients of mine who either during COVID or just before COVID, or before COVID really gripped us, landed jobs. Now that tells me something interesting. It tells me that employers, when they realize they need someone to fill a job, whether they can do it in person or not, they're going to fill that job. So  the element of despair needs to be combated with an element of optimism saying that if my company needs me to do this, if I have to do it alone in my, in my office at home or my basement or whatever, it's just not going to be a forever thing. I think the morale issue is something that employers have got to strengthen and let everybody know that the minute we can get back, we will. Mitch: (11:16) Now let's take a step back and talk a little bit about the skills, right? Whenever it is that we returned to the office, the environment's going to be different. There are going to be changes, but as you said, much of the job that we're doing right now, can be remotely can be automated. So as far as accounting and finance professionals, you know, moving forward through this pandemic, into the future, what are some of the skills or qualifications that you would recommend? You know, our listeners really focused on to best prepare themselves for that new norm. Eli: (11:46) I'm going to answer that question two ways. I want to talk about skills, but I want to also talk about where those skills are going to be applied. So you're right, a lot of what an accounting and finance professional does can be automated, but we have been through plenty of historic, current and waves in which automation was feared as something that would take away everybody's job, and it did just the opposite. The most recent of which of course was one that the PC in 1981, the IBM 51 58, if you remember that wasn't the first PC, but it was the first successfully marketed PC. Everybody was running around like chicken little saying the sky was gonna fall on PCs and computers go take away all our jobs. Well, here it is 40 years later and PCs have created 40 million jobs. What they did was they didn't eliminate jobs. They shifted them. They moved them over, and automation technology does that. Robotics is what everybody's afraid of today. But by the same token that a robot using ultraviolet light can clean a room to within 99.99% of infectious bacteria and other germs, and take away the need for somebody to come in and swab that room down for the three, you got it in 50 bed hospital to be able to do that. They're going to need a hundred to 150 of those robots. Well, who's going to build them. Who's going to program them. Who's going to sell them. Who's going to train everybody on them. Who's going to maintain them, and who in the accounting profession is going to recognize the companies that are making those products and say, that's where I'm going. So that's the second part of my answer. If you give some thought and do a lot of research to where jobs are going to develop. So let's say in artificial intelligence or algorithm development, or quantum computing, I'm trying to pick the very high tech jobs.  An accountant or a finance professional may may say, well, I'm not a quantum computing scientist, but the companies that are doing that are going to need the same kind of services that I'm providing, let's say to a waste management company or to a sports promotion company or whatever. And so the question then becomes none. What skills do I need? Which, which are skills that are much more soft than hard, decision-making, interpersonal skills, creative thinking, problem solving, but they're also, who's going to need them, and then you start getting into these very attractive lists, like clean energy companies, garbages energy storage companies, dealing with quantum computing, nano technology, smart homes, urban planning, ocean literacy, things like that. The question is, and for the job seeker, the job seeker has to do this for herself or himself. Where are those future jobs? I mean, I can get into that conversation with you, Mitch, but you and I don't have that kind of time today. So the question is good, or the answer rather is you're going to need to develop your soft skills more prominently now than the hard skills that you've already proven that you have. And then you're going to have to say, who's going to be paying me to, to bring those skills to the workforce. Mitch: (15:27) It's a really good point. And, you know, I think the next step here is, okay. So as far as my personal development, much of my skills, technical skills probably will not change. We certainly need to upskill in the soft skills, as you said, potentially a little bit of rescaling, but as far as personal development and moving forward, what should our listeners really do on their own? What should the employers and the various organizations be doing right now, whether it's virtually or planning for the future, how do we really get these employees ready for this change for this transformation and be able to adapt to these new work environments and these new roles that could be coming? Eli: (16:08) Yeah, you know Mitch every time you ask the question, because I say to myself, that's the best question he's asked and that you you've, you've done it again. From the employee's point of view, there has to be a commitment to, on going professional development. You cannot sit on what you've got. Now for the really skilled high level accounting person or finance person that means taking those courses, workshops, professional development webinars, and seminars that will teach you skills if you better already have them in planning and management. Because if you want to sit and do accounting work all day long day after day after day, you're going to be automated out of there. But if you, if you learn those things that are necessary to help lead businesses into the next year or the next decade and the next generation you're going to be doing that, you're going to be taking courses that may not have anything to do with your hard skills. What's it like to do business with the European Union for argument's sake, which is our largest trading partner. What are the cultural differences? What are the, what are the social necessities needed to do that kind of business? So, what the individual has to do is make a commitment to ongoing professional development. I have clients who have been smart enough, and I wish I could say it was my idea, but it was theirs. But I'll tell you what it is, who budget their annual household, the building to the annual household budget courses at their local community college. Now community colleges are treasure troves, and we all know that. To take courses in accounting, finance, computer science, urban planning, allied health, et cetera. They are  are all over the place. Every community, every County has one they're inexpensive, they're available, they're frequent. But my many of my clients that I'm talking to now are committing a certain part of their annual budget to learning Now, once you commit to it and you put money to it, it's going to happen, and you're going to stay up to snuff. Now, how much better do you think your resume looks when under continuing professional education, it shows that you are in progress of taking this course. You know, maybe it's a six, Six Sigma course, maybe it's a lean manufacturing course. Maybe it's a course that teaches you about the industry you're in not the occupation that you own. Now, I think there has to be a commitment on the part of employers and higher education to work together for the employers to tell community colleges or colleges and universities, look, this is what we see. We're going to be meeting over the next 10, 20 years as far as workforce development. How can you and we work together to, how can we tell you what you want, what we want you to build and how can you go about building it? And there'll be a wonderful relationship between the university or the community college and the employer. This is going on around the country, by the way. Technical colleges are doing that very, very well. I also think the government has to get involved, but the sad fact is that stategovernance, subsidies of private, of public colleges are down in all 50 States. And I think that it's going to come with government support to build those curricula that will help the businesses and the institutions of higher learning, attract the employee who is committed to doing the professional development. So you have a four-way partnership here, the individual, the corporation, the institution of higher learning and the government to whatever extent it is capable of doing that. That's a big, it's a big answer I just gave, but it's the answer to a very good question you asked. Mitch: (20:30) Well, I certainly appreciate that, and you know, all the backstory there, I think it certainly paints a good picture for, you know, what the question was intended to answer. So, you know, we started this conversation talking about the current business environment and we transitioned to the future of work, and now we've kind of got into some career development. So to wrap things up, I'd just like to give you an opportunity to, you know, share your insights or your perspective on, you know, anything else that you would like to share about career development, personal development, the future of work, and you know, what our listeners might be interested in knowing as they prepare to take the next step in their own careers. Eli: (21:07) Well, okay. So, you just asked me to talk to you for about two hours, Mitch. Mitch: (21:14) Well, we'll try and keep it as short as the last question. Eli: (21:18) As far as career development is concerned, there are, there are employers that do a good job of supporting that, but the employee has got to accept this as his or her responsibility. No one is going to do it for you. When you get help, where you get support when you get reinforcement. Yes, but no one is going to do it for you. A couple more points that while jobs are changing, they're not going away. You've got to look at where the jobs are going to be. And I mentioned before, lots of areas like nanotechnology or smart homes or vertical farming and things like that, you can do what you do now for a company that may not be growing into the future for a company that is doing exactly that. So we're, we're in more than ever before a job shift economy. I recently wrote a column that it was entitled, Everything I Ever Learned about the Job Market, but that, that the end and the completion of that was I learned during a recession because good times make poor teachers, but when things get tough, our learning mechanisms at our survivor mechanisms engage. What I've learned is this, that we're facing a new world. The job market is going to be different from now. None of us knows exactly what it'll look like a year and three years and five years from now, but it will be different. And for those who are saying, well, I'm 62, I'm 64 years old. I don't need to know about that. Oh yes, you do. Because it's happening that fast, and if you are going to be in the market in the job market for three years or more, you would better understand that second point is you better be ready for anything, because if anything can happen, it will. Whoever thought that Ford motor company, the company would basically started the auto industry, wouldn't stop making sedans, and they had. Unthinkable. If that can happen, anything can happen. Another thing is that that being ready by burning up on your skills, understanding where the workplace is going readiness will, will become more important than expertise, but you still need to be an expert at something you got to get really, really good at something, but you got to get ready for anything. Closing: (23:46) This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Amir Tabch: https://www.linkedin.com/in/amir-tabch/FULL EPISODE TRANSCRIPTMitch: (00:00) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. In this special new episode, my co-host Rouba dives into the world of FinTech in the Middle East region through an elaborate discussion with Amir Tabch. Amir has close to two decades of experience as a finance professional advisory board member for multinational companies in various FinTech and wealth tech initiatives. This conversation features the state of the sector in the region, and Amir explains how finance and accounting professionals can leverage these technologies to better support their organizations. Keep listening as we head over to their conversation now. Rouba: (00:47) I mean, you're someone who's acquired a successful career mainly because of your ability to read the trends and the patterns with passion. I mean, looking at the chart, I remember it, one of the stories was that whether it was your wife's contraction monitor or a financial chart, you have an eye for seeing the patterns behind the, when they manifest. So you pride yourself on looking past the complexity to see the certainty. How does one develop such an outlook, especially at a critical time, like now where God knows where the global economy is headed and trends are being accelerated or even annihilated , in some cases overnight? Amir: (01:26) Well, as much as I'd like to claim that identifying trends and patterns and forecasting is an inherent skill, it really isn't. Of course, on the other hand the creation is. Now there are essentially a lot of things that can take credit for being responsible when it comes to analyzing these prices and trends and patterns either when one's inspecting them in isolation or in totality. So, first of all, when it comes to looking at trends and patterns, it goes without saying that these analytical skills need to be honed. So one has to be in touch with market realities. We have to also look at human behavior industry changes, social and economic forces, and no amount of experience in the industry can make up for constant and consistent research. To be ever updated and in touch, not just with the events they can place in our industry, but all other events, whether it's culture, whether it's fashion. And the point I mentioned earlier, which is inclination. So being inquisitive by nature allowed me to always look beyond the final results and really go into these matters of causation behind those results. That being said, all who believed that being a man of numbers, someone like me, boring is not really accurate,  To be able to analyze these trends and immediately place the ones that are not in tandem with the market environment, which requires an extremely creative bent of mind. You have to be able to think outside the box when predicting matters of extreme relevance. And one also needs to be very well versed with consumer behavior and producer behavior trends that are a consequence of human psychology. And you have to have an approachable and inclusive outlook to things which allows you more room to acknowledge the possible mistakes and even benefit in detecting trends that would otherwise go unnoticed. And like you said, in such uncertain times, the only thing we can be certain of is the constant, unpredictable nature of things. And that's when we look at these trends and these patterns and these price formations, we can only doing so by living in the moment. And that is something I learned from, from Master Oogway in Kung Fu Panda, one of my son's favorite movies. He said, yesterday's history, tomorrow's a mystery, but today is a gift. That's why it's called the present. So Master Oogway a fantastic follower and really good at pattern. So basically living in the moment. Rouba: (04:23) If we were to look at this particular area, which is your area of expertise and, you know, something that's been on an evolutionary scale for the past three decades, we see most of   e-trading online banking and wealth tech driving it, but there's a recent report by KPMG that stated that over $135 billion were invested in FinTech last year globally. And, that the transactional transaction value is expected to grow to some $10 trillion in 2023. The Middle East financial services revenue will account for 8% of these figures. So experts find that this growth is directly related to the increasing number of FinTech, startups, growth of the Islamic banking sector and the high mobile penetration, which is above the entire planet. I mean the UAE loan has 173% So the UAE also accounts for one third of the total number of FinTech startups. We talk about 46% in the world, but in your opinion, what is really driving such an exponential growth? Amir: (05:29) Well, the underlying cause behind such results is the foundation really to building Syntech development, by the UAE policy makers. They began to implement these forward thinking policies, regarding the FinTech since 2017. Two leading, financial free zones, I've actually development and some tech space global markets on one hand and the IFC Dubai International Financial Center. Now the IFC created the FinTech hive, which was essentially a a hundred million dollar fund that gave companies access to accelerate a program mentorship from leading financial institutions and insurance partners. And in 2018 IFC I see an Accenture, which is a firm I'm sure everyone knows about, but to those that don't, it's a prominent consulting company. They signed a MOU to foster growth of FinTechs and enabled such types of collaboration in the region. ADGM created the reg lab FinTech sandbox where FinTech participants could actually develop and innovate FinTech solutions in a controlled environment. And obviously the after effect of these efforts have not only provided FinTEch startup much confidence and support, you know, also kind of generated an acceptance from the public, making them popular, so to speak. It's kind of like in football or any other sport for that matter when sponsorships not only provide teams with the financial support they require, but also the added benefit of being part of the sponsors, PR tactics, which can help grow the public state and the team. On another front, the demographics and these kind of things definitely play a role. almost half of the population in the MENA region is younger than 25. And this factor alone allows for growing market of early technological adopters. Now, the younger, the population, the more flexible and adaptable they are to these types of technological investments and UAE in particular acts as a gateway to a wider region, and enables FinTechs to enter emerging markets across Africa, South Asia, and of course the middle East. Now this expanded region along with being an $8 trillion market is home to 3 billion people, with 70% of them, having limited to no access to financial services. Now, although the middle East constitutes about 1% of the global FinTech investment, this sector is growing at a compounded annual growth rate of 30%. This means that for a mere and significantly smaller investments, the growth levels are multifold in amount. Now at the same time as ADJM and BRC created these environments to foster FinTechs and enabled them to grow, the Central Bank of the UAE and the SCA, the Securities and Commodity Authority, they established a dedicated  FinTech office to set national regulations specific to the industry. In 2018, they launched the production strategy, which aims to convert 50% of government transactions to e-payment services to allow these FinTechs to partake in the game. And they're also then, different investment funds who have come up over the years, like the, [inaudible] funds, which have raised almost $1.5 billion capital for tech opportunities. And, and this has led to the emergence of startups focusing on digital banking, blockchain, cryptocurrencies, InserTech, and so much more and close to 85% of FinTech friends in UAE region, are all involved in the payments and transfer sector. Now these developments, are inevitably a product of strategic initiative, champion by a variety of stakeholders. And last but not least UAE FinTech sector has been embraced by, and Emirati banks. And there's some BD ADCB must sort of continua few who are now contributing a significant portion of opportunities for the FinTech sector by involving digital payments, mobile banking, and in 2018 FAB and Abu Dhabi they collaborated to launch the Abu Dhabi Digital Authority to help simplify these types of payments. So I guess I have a strong reason to believe that it was the onset of a mix of various investment political factors and focus growth oriented towards policies that it had set the tone for the FinTech startup, the banking sector, and others to help UAE come through, on different tech accomplishments. Rouba: (10:22) I mean, it's, it's brilliant to see also this, exponential growth here in the UAE. I mean, really they're exemplary. I, as a resident and someone who who's been observing, you know, the kind of commitment that the government has had in identifying, you know, the key trends to follow, it's been really remarkable, but you, you mentioned that the banking sector as well. In Australia, there's data that shows that 300 branches of banks closed last year and, 200 and the fiscal year before that in the middle East, the impact is equally staggering with, like, for example, you mentioned Emirates NBD, they've been leading this change. I mean, they've invested some, 1 billion datums, UAE datums, in digital transformation initiatives in, but like improving their tech infrastructure bank offering, customer experience. But would you agree that the banking sector is behind these exponential figures that we're seeing today? And if so, why is that here more than anywhere else? Amir: (11:20) Definitely the banking sector has played an important role in the emergence of the FinTech sector. As I already mentioned, UAE banks have adopted fintechs innovations with the significant ease, whether it's ADCB, FAB, MSMBD, they have made it one of their primary objectives, so to speak, to actually employ digital modes of payment and other such services, which have a strong implication on securing the future of FinTech. And these banks have also forged very strong partnerships. We've got the ABCB link, partnership with Plug and Play in order to bring the Silicon Valley accelerator to open the offices in Abu Dhabi and integrate some of the best startups with the UAE comparable institution, and the objective of this partnership, because the promote the MENA region and primary as a finance, travel hospitality and healthcare. Furthermore MSMBD, they announced the partnership in order to certify digital FinTech startups that incorporated Emirates NBD is application programming, interface, sandbox. The API sandbox and is a first in three region and has been an important target met individually bank starts permission program. Now this has been a significant large milestone in the coming of age of FinTech, and to be able to garner support from the companies, banks has been quite a victory to the industry. We definitely can't take these investments lightly since they've had such a major impact on fueling a relatively less popular sector, so to speak. They've also been large scale initiatives and partnerships, undertaken by US financial services company. In 2019 Citi, they have their first, MENA FinTech challenge, offering the FinTech community to rise up to the challenge and set forth their innovations into practical solutions. Through my own experience, I can say that such a move can have an immense the motivating impact on the innovators and founders of these startups. I for one can surely relate to the times when I was in business school, when we had to give mock presentations on business ideas and having these discussion forums often helps, when professors would come in and take part in them, it just helps you to, realign your goals and take a leaf out of the notebook of people who've already been there and done all that. Similarly, in 2018, also MasterCard, they conducted their first Start Path Summit in Dubai. They brought together the FinTech startup regimen on the spheres of artificial intelligence, big data, e-commerce, security, financial, including on payments. To pitch their ideas and solutions regarding financial services of the summit. Such partnerships specifically the one providing them with somebody has definitely allowed the banks to capitalize on these ideas and the technical expertise of FinTech. at a time when technology is the only indication of moving forward. And, all of these developments, if we want to call them, we're bound to have a kind of a trickle down effect as local banks begin to partner with FinTech firms in order to digitalize quickly. For example, on a close interaction I had with one of the local banks, I learned that they adopted the FinTech solution and developed, the digital wallet, which stores users' funds allows them to transfer money through the wallet security. Now, when these big players in the market start adopting changes in their operating and business model, and it's, without a doubt that the smaller one, often they begin to follow suit, and the outcome of this domino effect, if you want to call it, cause, uh, an enormous rise in growth, Fintech, especially in the MENA region and so many other parts of the world, like you, you, you, you stated. FinTech the question as to why simply it's kind of a supply and demand the factories supply, and the manufacturers want to call them, advances in computing power have made available and doable, innovations they're sharing data storage, online modes of business operated through lower transaction costs. In addition, in the wake of the previous financial crisis, various services, such as micro-lending have been minimized, by financial institutions, such as banks, however they've been made available publicly by different tech companies. UAE bank, they were quick to embrace such, such a little bit technology transformations and digitization. Well, that being said, there has been a certain degree of, contradiction in the sector is ability to embrace FinTech as well. There are still cases where some banks are reluctant to integrate FinTechs into their strategy. They're following more of a wait and see approach. Obviously these banks are not yet ready, to leverage the full suite of FinTech at the moment, but they need to partner more with FinTech startups to provide a, a better experience to customer at lower cost. However, the surge is on to constantly adapt and stay connected with a much larger global circuit of changing customer preference and the banking sector. (Inaudible) hesitant has definitely engaged in these significant partnerships and investments and ensuring their own future and in the global  FinTech market scenario. Rouba: (17:26) I mean, all of these things are mainly driven by, you know, digital disruption. So when we look at this universe that we're living in currently, you know, a highly digitalized world where all sectors, I mean, nobody's exempt has been either a disrupted or in some cases, knocked off, you know, upside down. This includes the finance and accounting profession, which is, you know, this mainly the audience that we address here at Count Me In and where many of the road tack tasks that, you know, have been taken over by automation are, you know, putting a big question ,ark on what is really the future skillset that people need to kind of maneuver. But if you were to look at the two sides of this coin of this transition, meaning what are the negative implications of say, FinTech on finance and accounting, and on the flip side, how do you think this is actually improving the profession? Amir: (18:21) Well, as we know, the government has reinforced for pushing for digital transformation with regard to the financial service industry. And that is in order to remain competitive in the global arena, as well as stay on the forefront of evolving customer prime. Now, the Metro region, for example, Middle East, Turkey, Africa is expected to invest $20 billion on digital transformation this year. And up to $40 billion by 2022. And in fact, 30% of the, of the MENA FinTech firms are based in UAE. It goes without saying that such a campaign of this stature is bound to have a major impact on the main industry targeted by the growth of FinTech, whether it's the banking sector and the effect is either direct or spillover effects. Now, if you asked me specifically about the job market, I'd say that it is expected that a considerable shift will take place, with the average age of UAE employee being under 30. Revenue forecasting is seeing the crucial component of planning, and as a result, there have been become a demand for financial planning, analyst, financial managers and developers in 2019. It was just a game of demand. For example, as more and more people switched from traditional cable TV to avidly watching content streaming platforms like Netflix, it obviously created a demand for such platforms to pop up in the near future. The same is true with the job market and demand for financial analysts. And if we talk about the banking sector as more and more customers visit their premises toward digital services, banks have interned also begun to restructure and digitally transform their departments. This has led to a surge in hiring of mixed talent and recruitment of, overseas talent, to the region and the key changes we're witnessing and that these banks are focusing on retraining, redeployment of employees as automation trends, make its way to the banking sector, which is allowing UAE to move towards a more efficient and improved workforce in the long run. However though, the long term effects of this structural shift are positive in the immediate scenario, a majority of your workforce is employed in relatively rote tasks. and this shift has definitely taken a toll on that specific section. And even it kind of created considerable pressure on the current shortage of skilled employees in the market. The ambiguity, the ambiguity of the result is obvious, and I think only time can tell just how well FinTech has allowed for the positive restructuring of the banking sector workforce. But in terms of looking at the banks, the profitability of the banks, I'd say the, the, the FinTech revolution could actually reduce the profitability of some lines of DC banks and change the way they operate. However, major disruption in their lending activity is not expected. That being said, there are some definite negative effects of the same on retail banking that is money transfer and foreign currency exchange as blockchain and cryptocurrencies pose a serious competition for these services. And of course, banks in the UAE you have not been oblivious to the, the growing technological trends. They've invested actively in areas of digital and artificial intelligence. Now their profitability has been, on the down low  since the biggest oil slump took place after the 2009 financial crisis. But for the time being, the bulk of the banks main business and the region that is lending, but I think would remain kind of insulted for a significant period of time as it is relationship based on the human added value significantly from corporate relationship managers to decision makers. Yet we can't deny that most or the most of this disruption is the payment business model, since it is more technology intensive and thus it can cause banks to adjust their operations through, staff rationalization, and, brush up reproduction. Now on average banks in city are still extremely profitable and efficient by global standards. When in fact, I believe that FinTech may even continue to be conducive in enhancing efficiency of lending operations rather than disrupt them as a significant proportion of the bank's revenues related to lending, and to advisory activity. Now, statistically speaking, 86% of the banks estimated that no more than 15% of banks, a business would be lost to FinTech in the next five years and allowing for fund transfer and brokerage to be the main business line that will account for the disruption. Rouba: (23:45) I mean, these are, by the way, some that's pretty mild. I mean, 15% is, is mild in contrast to the larger figures that we're seeing on, on AI taking over and the automation just overruling. Most of those wrote tests, which you mentioned, I'm sure that they, they represent more than 15% and that's scale. So when we look at the online collaboration, that's becoming the new modem operandi, realistically we're talking about an entire ecosystem that's been potentially founded in the cloud, you know, with even financial management systems becoming cloud-based, but despite the new laws being applied by regulatory bodies, the GCC naming the net, for example, in the UAE and Saudi, those were the more, most mature markets really at that scale. There are major concerns about around security and data protection when it comes to Findex solutions, amongst other things. this is validated for example, through a substantial increase in the number of cybersecurity focus, FinTech companies, how can accounting and finance professionals ensure that, you know, it's not just ethical, but also secure integration and implementation when it comes to incorporating these technologies in their day to day, once of course, you know, aligning with regulatory compliance and mitigated risk. Amir: (25:10) Oh, threat of cyber attacks is now everywhere. Be it some using social media networking sites, or even something that my wife and son, sorry, with this online shopping. on average though, they exist almost 45 to 50% and trading of personal information through these social media sites. So really, how safe can this, all banks be in all of this as well? According to a study I read that was conducted by, immune Hub. They are a Geneva based application security company. They stated that approximately 98% of the top 100 global FinTech startups are vulnerable to cyber attacks. Now you can really see just how serious are the threat they pose to financial institutions to risk of data breach, cloud environment, security, risks of innovative curriculum systems and even application security. And now we do with the economy trying to slowly pay its way through the pandemic this year, FinTech innovations deform, a crucial element of the survival. If my years of forecasting and trend analysis has taught me anything, is that the future of the financial system or the financial system itself lies in building a cyber risk free ecosystem, and although it is largely the FinTech startups, that must be responsible to maintain the security, finance and accounting professionals can contribute significantly to strengthening the system o various ways to adapt. And often the question arises as to why our finance and accounting professionals well-placed to type of cyber crime. I know it sounds strange, but it's actually true, and there are three main reasons that I know of when in the field are absolute winners for why these professionals can contribute in battling cyber crime. The first of them is the accountants to assess professional qualification that allowed them to actually quantify costs and perform comparative measures on the cost effectiveness of different security measures. And secondly, finance professionals possess required industry knowledge and extensive strategy input all about not directly in the IP field. And lastly, mitigating and ensuring that risks are managed and come a second nature for accounting and finance professionals. Who've been, who can assess and identify the threats and risks that may endanger their clients and even their organizations. Now with these professionals, think from mine, finance and accounting professionals can become actively involved in planning their company's strategy with regard to countering cyber crime, beginning from the very top of the hierarchy. So CFOs can become and integrally acquainted with the roles and responsibilities of the chief information security officer, and similarly, professionals can also tend to bridge the finance and IP department of their organization and even students, they can opt for streams and their coursework that links to both these fields. It is my understanding that within the organization, finance professionals can determine and analyze the financial impact, even cyber attacks by advising leadership on matters of company-wide preparedness. Defining risk management strategies and other important tasks that can be carried out along with identifying where to best utilize resources, to actually counter cyber threats. Accountants, they can leverage their familiarity with compliance issues, in order to stay on the forefront of legal and regulatory measures that increase liabilities and penalties for organizations in the event of data breaches. And along this thing on the frontline of protecting the company's valuable financial data, complying with protocols and regulations initiated by various organizations and governments to ensure cyber security systems is the bare minimum that any professional within the organization can do. Now UAE banking. And finally security innovation drove the GCC cyber security market to an $8 billion market in 2019. And as a result, finance and accounting professionals who can actively manage it, issues will have an edge over their peers and be in high demand. Closing: (30:01) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at wwwimanet.org.

About Brad Ledford: https://www.dhg.com/people/userid/278?filter=bledfordContact Brad Ledford: bledford@dhgsearch.com or https://www.linkedin.com/in/expertrecruiterbradledford/DHG Search:https://www.dhgsearch.com/FULL EPISODE TRANSCRIPT:Adam: (00:00) Welcome back to episode 95 of Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host Adam Larson, and I'm here to preview today's conversation and introduce our featured guest speaker, Brad Ledford. My cohost Mitch talked to Brad about the changing job market and the new norms and job seeking, interviewing and hiring. Brad is the President of DHG Search, where he provides advisory and recruiting services for candidates in finance, accounting, audit and tax. In this episode, he explains what recruiting looks like today and describe some new opportunities in the workforce to hear a great career-related discussion, keep listening as we head over the conversation now. Mitch: (00:48) So Brad, to start in broad terms, from what you've seen, how has the job market really changed over the last six months? How did companies change their approach for hiring? What did the overall job availability look like? You know, just from your perspective, what has this last few months done for the job market? Brad: (01:09) Yeah. Great question, and there's no doubt, it looks different. The one thing the unemployment rate has jumped from 2.4% approximately now up to 8.4%, and that's down to slightly where it was maybe just just a few weeks ago. So that, that right there in itself is a very good indicator of some significant change in the job market. And what I saw during that window, as COVID-19 started to impact the marketplace, were companies really pushing the pause button or, in some cases, opportunities just drying up. And really from that, I'd say that March to May or February to June window is where that started to really show,and of course, unemployment rates started to spike. You then saw in that same window of times, companies starting to lag their process or slow their process significantly. Even if they already had just started a search or recruiting process. So a lot of times individuals would be, in the beginning stages and all of a sudden feel like, Hey we're where did that search go? Where does that process, end up and companies were kind of, Hey, wait and see mode during that window. And then some just really were not interested at all in hiring, during this last six months. So you've seen a little bit of pockets in both areas where, you know, some companies are starting to come back, but, you know, from that last six months, we've, we've seen a big change and, and how, the market has been impacted. And then part is your second question, I guess, how the companies approach hiring and what does it mean to overall job availability? You know, I think companies started to realize there are some candidates coming on to the marketplace and then they started looking at their job profile and their role and what they needed. And what I saw was companies starting to add more boxes to the checklist that they needed. So instead of it being, Hey, at 2.4, under 3% unemployment, and if these people had these couple of things and then this good accounting skills or certification or background, it jumped to, wow, I need these 10 things checked and their background to consider them for the position. So it really did change how companies were approaching, hiring, and then also, you know, availability, job availability changed. Now I'll also say it was interesting that there was, there was some organizations that looked at this as a scenario of, hey, there's an opportunity to add resumes to their database or add connections or contacts. And so you may have still saw some folks, I guess, taking candidates, but it just, it just slowed significantly. Mitch: (04:19) So our listeners, accounting and finance professionals, they span many industries, and I'm just curious again, from what you've seen, are there particular industries that remain more active or even successful in hiring through this? And then I'd like to get your thoughts on the opposite as well. Are there any roles or industries that really suffered more because of the change in the hiring process and the availability and everything you just mentioned? Brad: (04:47) Yeah. Great, great question. At the firm, I'm part of Dixon Hughes Goodman, and the team I lead within DHG Search. We go to market as an industry and service specialists, of course. And so that industry piece was very important that we had a wide range of industries we serve during this time, because there were, there was significant change in that as well. You know, a few of the industries that stood out as continuing to hire with course ones that had the essential business aspect to them, and those were construction, healthcare, some real estate, and then the other one that you saw kind of spike during this window of time, is IT, and IT companies, or IT roles because as people were going more remote, IT needed to step in and really add to their team to be able to service their own internal teams or external clients that they were serving. So those, those are a few industries that jump out to me as, as, we saw continued, activity in. And another one that was kind of surprising was automotive space, the automotive dealership space. I have a team, and a leader that does a great job in that space,  and what she saw was definitely they pushed the pause button, but it kind of came back a little quicker than others. And I don't know if that was just where some confidence was or some opportunity was there for individuals to, with low interest rates or whatever the case may be to, to purchase a vehicle. And so we saw that bounce back a little quicker as well. But then there's others that were a mix I'll, I'll put healthcare in that space too, because in some areas of healthcare, it was, we need talent and we need to find talent, but there was some specialty areas where people were not being able to utilize or get out to that then also were impacted. And then the other one that was significantly hurt was hospitality, and the restaurant space. That space, there, there were companies that are no longer in business now due to this pandemic. Mitch: (06:57) And how about what things look like today? What is recruiting, as far as what's available and, you know, for our listeners, whether they are passively looking for work or, you know, actively looking for work, maybe they came from one of those industries that really suffered, you know, what can those looking for a job? Or those looking for recruiting help, expect today? Brad: (07:19) Yeah. So it looks a lot different today. the first thing I would say you want to do today is make sure you have your own technology ready to be able to do Zoom videos, paint team videos, videos, remotely of course, for these interviews. So that, that's the first thing I would say. That looks way different. A video, a viral video comes to mind as you asked that question and our world looks a little different in, and I think it was several years ago, maybe 2017, 2018, a reporter maybe in the BBC or a professor was on a reporting segment and his child walked through the background of the video, and then the wife walked through the background of the video and he he's trying to do this very serious news report and just, it just goes wrong. Right. So what I would say today, is the first thing is making sure you have your technology in place, and then also make sure you got a spot or a space where you can be, away from distraction and activity. Now, I think because that's what our world looks like today, and everybody's had a dog bark or, or maybe even a child coming to all these videos and Zoom meetings we're doing. I think the environment would be a little more forgiving in this case, but, but again, that's the first thing that looks way different is, is being prepared for those type of meetings and interviews that have to take place in today's market. A couple other bullet points that really jump out to me as, as you're thinking about recruiting today, and some of these are staples, but, but of course this is review strengths and your skills gap, you know. Do your planning and, and do your homework before you go into a recruiting process. Building the resume, making sure if there's skill gaps that you can improve on or education CPE or certifications, of course, great ones that we have through the IMA and other other organizations have, make sure you're doing those things to build the resume and your skills. And then, and then the one thing that I think is important when you're starting this process, whether you're actively looking, as you talked about or passively looking, what that means is actively looking, you may be, you may have been impacted and now you are proactively looking for the next role and then passively, maybe you are, Hey, I'm in a role. There's some uncertainty in my business, there's some uncertainty in the future of the role that I'm in, or I'm just wanting that next career step. Those are two different, aspects.  Some pieces are the same and some are different. Clearly if you're actively looking, you know, you need to create a process for tracking your activity, and that can be a simple Excel spreadsheet with date company, contact information, position responses, just so you can go about this with a strategic mindset, and  a good clear process that helps you track the activity in it. And sometimes it even helps you make sure you put activity on your calendar to go do that proactive work. It takes to find the next job, especially in today's market. And then, you know, the other piece of that is the fourth thing that comes to mind is target connections and relationships, and the companies you want to work with, you know, that's something you can do in a passive mindset, as well as the active role, looking for that next role. So really you want to look at the target, the connections relationships, and then the roles that fit your background, and then, and then identify the things that fit your background, your interest, or your skills, and make sure it lines up with that opportunity. So, you know, if you're actively looking, you're definitely going to be looking at job boards, such as Indeed, of course, LinkedIn, as well as look at your professional associations as well, that you're connected to that have maybe jobs very much aligned with your background, such as the IMA and accounting association, they have a job board and you can use that as well,and that's a different, tip and trick versus just looking at Indeed where many other type of jobs filter into that search search tool. So those are a few things that jump out to me, kind of recap there, you know, definitely plan review your strengths and skill gaps, build that resume, create a process for tracking and then truly become strategic about the target, the connection relationships that you have, and being able to connect with those and then identify the fit, the role that really fit your background and, and pursue those. Mitch: (11:53) Thank you for sharing those very specific and more importantly, actionable points for our listeners to go through, and, you know, again, going back to actively looking or passively looking, hopefully those who are listening to this podcast, one way or the other, get the opportunity to take the next step with a company and go through the interview process. Now I'm assuming with this remote work and virtual environment, the interviews are also changing. So what can our listeners expect if they do get that call and they get to sit down for an interview with a new company? Brad: (12:27) Yeah, the process does look a little different. I think you need to be prepared for the step before would be, Hey, I'm getting a call and I'm moving to a direct in-person interview today. Of course, I'm seeing a few more steps added to that process versus directly to that in-person piece, and that might look like an initial phone interview or, or that ideo interview or phone interview, and then video interview, in part of that process. So, you know, and then also you are seeing in today's marketplace, sometimes some pre-screening questions, even that you may have to answer before getting that interview and submitting that information. So there's, there's a few different steps there that I think companies are doing to, to of course, understand and appreciate the environment we're in and safety and wanting to be safe through this process. And then, and then even at that point, it looks a little different because what I've seen with clients today is you need to be prepared for, Hey, is this interview going to be an open air setting? Is it going to be something where I need to wear a mask throughout the whole interview? Is there going to be room for social distancing in the conference room that I'm going to, and that's where I think feel comfortable to ask those questions or speak up beforehand. So you were prepared to walk into that interview and not be thrown off guard, if two people, you know, are six feet and don't want to shake hands before, which is normal, it will feel a little different if you don't prepare for it a little differently and be prepared for those type of aspects. It's kind of interesting. We have a construction client we work with, and, and of course during this window, that was one of those industries that kept interviewing. So we had to figure out a way, and the client had to figure out a way to, do interviews and they still wanted to meet people in person. So they came up with the tailgate interview, so they would meet outside and, and, and make sure they remain there social distance, but still got to meet folks in person for some of these operational roles in the construction space, and then even in the finance space, we made sure there was social distancing, in those types of interviews. So it does look a little different in today's market. Mitch: (14:48) So we've talked a lot about the remote and the virtual aspect of the recruiting and hiring process here. you know, but what other challenges are job seekers faced with today? And if you could share some of your perspective, how can the listeners overcome some of those challenges as well? Brad: (15:09) Yeah. You know, I think what I'm learning and adapting to, as well as, as an executive search recruiter and understanding what clients are needing and what individuals that are going through that process are adapting to, you know, there clearly are some challenges in the industry markets are down right now. So, you know, that is the first challenge that comes to mind is, more people are available, and so you need to be thinking of skills and the building, the correct skills needed for the current market, but also that future market. So, you know, I think do, a skills assessment and tools, and I know we have tools like that within the IMA as well use, use different tools that are out there to help you assess, Hey, where are some of those gaps and where can I be improving? I think the process and scheduling challenges has increased significantly because of this. And you think it'd be simpler, but the reality is it's been more steps added to it and, aTd just needed more patience So the way to overcome that is making sure you have your technology in place, being flexible, meeting locations and some pay patience The third one that jumps out to me is networking is different. You know, we, we aren't having live CPE. There aren't as many social events where you would be able to network, in, in the normal process, you would maybe have passed the, information along or connected with folks and let them know you were looking. That looks a lot different today. So don't be afraid of virtual events, and that's what I see companies like ourselves and others are going to doing virtual events to stay connected. And, and what that might mean is a phone call versus, you know, being able to see somebody in person still don't be afraid to reach out and stay connected, and then look for those opportunities to connect in those virtual events, because if you do even see, maybe it's not the same, you don't get to speak to them in the virtual event. If you see them in that virtual event, it gives you an easy touch point to follow up with them afterwards. So, you know, I encourage you to stay connected that way. And then the last one is in adding to that connections is the communities that we are part of the accounting profession, the organizations that were part of staying plugged in, being active in a very big proponent of volunteering and learning, that way through organizations, you know, stay plugged into your communities that you were part of. And the accounting community is a great community. And one I enjoy being part of and missing some of that connection. So you've got to find ways to reconnect. Mitch: (17:56) All right. So now let's end on a positive note. We talked a lot about some of the opportunities that have come up because of this virtual environment, but just like we said, there are other things out there. So what are some of the new opportunities available because of what we'll call this new environment? Brad: (18:14) Yeah. You know, there are still, changing opportunities and there's new opportunities that are coming because of this environment we're in today. The biggest one that I've seen so far and talking to the number of clients and searches that I'm working on is organizations and companies are way more open to remote work. Being able to do the project, we're proving that we can do that now through a six month period. So therefore I have a company in Jacksonville, Florida that I'm working with that is literally has a remote team now. So when I went to do the search, wow, it opened up a great new pool of candidates that were, open to those roles. So, you know, that's a huge opportunity coming out of this new environment to research and see if that might work for you. Of course the reduced travel is an opportunity in this. There may be been some other roles before you couldn't do, because Hey, it required a ton of travel. Well, now those opportunities don't require a ton of travel, and so there's some new positions that are opening up that maybe you didn't think of before that now you could apply to, or could seek and go and compete for in a different way than ever before. So that's very exciting to me as someone that just six months ago, when unemployment was so low, it was tough for any company and any recruiter to find talent. Now it's an opportunity to see it as a much broader playing field and go compete for roles that maybe you didn't think of before and there's talent available right now. So the other piece of that is also, don't be afraid to look, to make a move during this market. I would, I would say, do your homework, of course, some people, what I'm finding is candidates in that passive bucket, maybe saying, Hey, is it the right time for me to make a change? I'm concerned about the still the environment we're in, and am I going to jump into another company that may have some challenges or issues. Well that doesn’t c change to when you would change before and that you need to do your research, go through the multi-step interview process, ask the great questions to make sure it is the company that you want to be part of. And you still can make that move even during, this environment of COVID-19 and the pandemic. There's there's opportunities out there, So I encourage you to continue to be positive, be optimistic, and then look for those new ways, to plug in, in this new environment and find a new role. Closing: (20:48) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

FULL EPISODE TRANSCRIPTAdam: (00:05) Welcome back to Count Me In. IMA’s podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson, and I'm pleased to bring you another bonus episode for my co-host Rouba Zeidan. For this conversation, Rouba talks with Asha Merugu, senior manager at EY. Asha explains her career journey in the finance industry and shares her perspective on how gender parody is being driven in many private and government sectors in India. Let's head over and take a listen to the full conversation now. Rouba: (00:38) So according to the Global Findex database released by the World Bank, roughly one out of two bank accounts in India remain inactive, which is about twice the average of other developing economies. What is the worst, you know, is notable in terms of the gender gap when it comes to this amount? So for example, 54% of women account holders report not actually using their accounts as opposed to 43% of male holders. Do you think that there's a need for financial education amongst women in order to render the more financially savvy? Asha: (01:18) No, it's a great question. Obviously, yes, right. So there has to be a financial education amongst women. There is no secondary view about it, but if you look at like in today's era, what is very important, is it just not awomen, like, even men need financial education, but of course they are considering, you know, I have gone in a very small region India and you know, so my mother is a working professional. She was, she is a doctor, and then I have seen as a kid, how challenging it is for working mothers to manage a finance and a home and a work. So finance was always in the hands of the father, right? Like the major decisions were made by fathers and anything to do with the major investments in India is always made by of, you know, father of the family. So that's how the most Indian families, which are traditionally like, you know, middle class and maybe a little bit higher upper middle class families would do except for some exceptions. But, but I agree with you, I think considering the way, you know, the India is going on. Oh, you're right. Like most of the wommen in India does not have active bank accounts. You know there could be majority of the reasons, like, for example, if you take working women, they do have bank accounts, right? So because salary gets credited to bank, but look at the number of transactions that happens in the account. Oh, I mean the service here sees that most women are not very, very, investment savvy. They don't really want to invest and take risks. This is like a majority of the mindset because it's, it's always a protective or culture that we have grown up. Right. We have been grown up as a kid that, okay, you have to save, you have to take care. You know, you have to, or you have to secure yourself, and this is how I think the education system in India works too. And this is what makes women very conservative, especially I feel in India. And most of the women though, they earn salaries and their bank account would be limited to the salary account. You don't find them making the investments, which meant there to make it aggressively. Right. They don't actually spend the portfolios aggressively. Now coming to the question of, you know, like how do you give this education to your question that, do you think there's a need for financial education? Yes. I think there's a very, very, very important need for financial education, especially amongst I think the middle class families and, you know, the working woman category, the Indian government is also doing quite a few things to get this education spread amongst the communities. In fact, I think if you look at Jonathan Yogendra that India, God, which makes every household to have an account bank account, you know, compulsory for the purpose of getting the pension or maybe for the purpose of getting any of the amenities, which our government is passing on, the government made it mandatory. I think that was a great initiative from a government perspective to get women  data, at least as a concept of saving. And there's a concept of you having an account to get your money. That way the woman doesn't just take all the money and put it in the hands of men. In some families, I think it's very unfortunate that this will happen so that the government has done some initiatives by having this agenda huge now. And I think bringing some education, bringing all the schemes through which the small amount of the money reaches, right. It reaches through an account itself. So even though I think the report says a lot, gradually my view is that is India speaking up. You know, the people are becoming extremely, you know, now savvy about using the bank accounts, you know, using digital means and more so because of the COVID right. In the last six months, I think we have seen a great transformation in India. Maybe this question would have been definitely very relevant six months ago. And I see, Oh, you know, because there was an option for people to use and not to use digital means and accounts and et cetera, or, you know, people may be what I think, not, not really compelled to do it, but if you look at now, I think because of all of these initiatives of a government and the COVID and the digital initiatives, which are coming up in India. Digital India is a biggest initiative in India where everybody is forced to use it. I'll give you like a very small examples of how I see in, you know, women are using, you know, bank accounts now, because they're compelled to have ATM's and pay apps and, you know, all of those digital wallets. You know, I live in a very small place, like, you know, like it's actually cost mobility. And I live in Bangalore, you know, which is, which is a very good city, but there are some places of the Bangalore, which has got, you know, a small streets where all the women sit on the floor and they sell jewelry, they sell vegetables and they sell all the types of items. And I see a biggest advancement amongst them, as they do accept digital mode of cash, which means they're getting comfortable, right, to start using digital initiatives. I think I feel, yes, there is definitely a need. I mean, it is definitely important for government to think through more, to provide a financial education, but there is definitely some kind of an advancement happening in India. So that's what I feel. Rouba: (06:20) Amazing initiatives actually. It kind of gives you a very promising view of the future, but I mean, despite this rapid, rapid and consistent growth of the financial sectors, we want to zoom in on that. And specifically in India, there's a widening gender gap in the country's financial industry. I mean, with women, underrepresented, underrepresented in employment, at nearly every single level, this is the very same ecosystem that you rose to a leadership position, and yet you remain undeterred. So how has your experience been, and what were some of your guiding principles? Asha: (06:59) Yeah. So it's, it's a journey, Rouba, isn't it? It's all about a journey. Leadership is all about, I think the purpose of a life and living life. And I truly believe in it, you would not be able to achieve anything overnight, you know, in life, right. You have to really strive for it and you have to dream for it. And I've believed in this principle that, you know, you're all about your thoughts. If you think you can, you can, if you think you can't you're right, because you thought that you can't, right. So the human mindset is always about the thoughts and the thoughts makes you and, and thoughts breaks you. So of course, I think the women in India definitely has to, you know, has to support each other to, you know, like get into the ecosystem and understand each other and understand that leadership is not just a position in the organization. You know, I keep telling this to people like, you know, just because somebody is holding a directorship in an MNC, or somebody is holding a senior vice president position, you know, in a large company that is not leadership. According to me, you know, leadership is, is just a dedicated intention to do something really great, right? Something, something which you ask buyer to do it, you have to be a problem solver. You have to be, you know, you have to be a person with great aspiration. You have to be a driver, right. I mean, in the workplace, in the community and at home, we have all the opportunity to show leadership skills and it just, I think we just have to live with that purpose. We have to understand that leadership is all about assuming that you are a leader by your self and self drive things for you. Find an opportunity in every challenge, right? Find the solution in every problem. It just stand up like as small as a woman who stand up for the family and gives the support to the families of, true leader. And we find, I mean, take an example of an Indian prime minister, right? He is what he is because of his mother. And he keeps saying it in all the forums that his mother was, I was a leader, true leader for him. Though, I think she hasn't was holding any big positions that she wasn't educated, but the dedication commitment that she got to self-drive herself, she's known, I think, you know, more than 90 years old,and she does all her work on her own. She lives by herself. And these are what I think are the leadership skills, which is what all of us have to understand. We should never be like de-motivated or disappointed by looking at someone's position because all of these are, you know, materialistic, right. A leadership is, is a state of mind if you believe that you can achieve and whatever you achieved in an area that you truly believe in, you are a leader. And my guiding principle always been lead by example. Right? You have to lead by example to build a more inclusive culture. Rouba: (09:39) And then if you were to look at, the, you know, beyond multinational companies, initiatives, do you believe that the private sector is indeed presenting women with equal opportunities to rise to their full career potential? And what are some of the initiatives that you can kind of, refer to or commend as well within that spectrum? Asha: (10:01) Yeah. No, it's a great, great question. See, I'm giving more from an Indian context. Of course I can generalize, but, but yeah, in India, you know, yes, there are public sector undertakings, there is private sector, and of course there is a multinational sector, which is like a larger, you larger segment of a private sector. Yes, I agree with you. Okay, so I think, you know, to the extent the, as I believe that the private sector is indeed or giving fairly more opportunities for elementeries up to that, you know, carrier potential compared to the, public sectors. I mean, I'm not kind of making it a way statement to say, no public sector doesn't do anything, but that's not what I meant is they do, but of course, because of, you know, the culture in which the private sectors have grown up and because of, you know, segmentizing the entire company, right? Like by way of introducing departments like headshot and, you know, introducing departments like talent culture, and, you know, some of these, assigning the responsibilities to get the diversity and inclusion as part of the agenda is of course driving private sectors much more faster than the public sectors now, because public sectors I think are doing better, but is there like a top, most part of their agenda, maybe not, you know, it is just, okay, because some, some schemes of the government also compares here that you have to have an X percentage of women. I'm sure, you know, when the entire elections were happening in India, there was, there was this entire thought process that, okay, some 30% of the entire seats have to be filled by women, right. And they'll say some force and something is made mandatory. And therefore, you know, some companies justtend to pick in the box and say, yes, we hired women because we have, we have need to have that gender gap in the organization, but some companies are truly taken it as an agenda and truly want to drive that initiative. Like, you know, where, where I work, I work for EYi, and EY truly this initiative. Right. And I see a diversity and inclusion being very seriously taken. And women employees are given a lot of flexibility when, I mean, flexibility or, you know, I'm sorry if I have to like call flexibility as, you know, less working hours, right, less pressure job than it is not a flexibility than it is taking away your opportunity. Right. Flexibility is where they're allowing you to do the work, you know, maybe at a, at a different timelines, but you're doing equally what the men is doing. You know men, isgetting up at like 10:00 AM to like seven, eight, 9:00 PM. Maybe women when needs a little more flexibility, you know, like maybe I'll start in the morning and then, you know, I will continue my schedule is because we have lot of things to manage. We own up the family and right. There's a lot of ownership, you know, as small as like, you know, if there's no toothpaste at home, we have responsibility to just get it replaced. And, and like we, as a store's manager, we are the producer, you know, we are the cook and we are like heart and soul of the entire family.So there's a lot of pleasure, right? So there is, the companies are doing a lot to give that flexibility, especially, you know, the woman needs a lot of support a couple of times in the carrier, right? Like one, whenever there is a marital status getting changed and you know, and there's a marriage happening, is there are companies who actually have the flexibility for them to relocate from one place to another place so that she doesn't lose job. And then, you know, also, continue to be a part of the same organization. So there are relocation policies, you know, there are some  good initiatives. When it comes to like a maternity, which is like the biggest phase where most, women, you know, it is like a boat. Either, we sail, or we draw. We keep thinking, you know, should I, or should I not? And some people just make a very bold step that okay, I should. And some people will think, Oh my God, you know, I'm losing on the motherhood. I'm not able to take care of the kid, and some people will draw. So you see a lot of women in a way when I put like a organization structured as a triangle, a lot of women drops as the start reaching on the top. Not because they don't have the ability to reach on the top because the, the age at which they started to age at which they get into a middle management is an age where they also got into the, you know, family pressure. They got into a lot of, you know, the, I mean, a lot of social of circumstances. It's like something that, you know, there's a comment by a lot of forces and that is where a woman has to take a good step, and some companies are helping. Some companies that are having flexible, no maternity leaves like, you know, the organization that I used to work for had something called shared leave concept. Okay, well, let's say six months as a maternity leave. And I think by the way, if, you know, in India, that's a greatest change in India. It used to be three months, you know, offer maternity leave, which technically means like 12 weeks and India was I think, a good enough, you know, I think the Indian government was really great in putting those efforts to make it six months, which means the women can go to maternity leave for six months in India for the statue here. Rouba: (14:53) As a woman who had to fend through competition injustice and to some extent, unequal business worlds, and obviously you mentioned that your current experiences, has been great with EY. And so maybe in your past and going into this career in finance and coming through with flying colors, what advice do you have for women who are looking to make it in the finance sector or even any business sector for that matter? Asha: (15:22) Yeah. Okay. No, it's a great thing. I can share insights, not really an advice, but I can just share my experiences of how one should look at the finance sector. You know, I, before I shared that, what I really want to say to a lot of women is, I mean, we are definitely changing, right? The world is changing. think about like womens’ you know, enrollment in higher education, like before the, before, like, you know, even if you talk about, like little bit in a while ago, maybe in the year 19 hundreds, if I go with less than 10% and it's, it's great to see now you will see around 48.6% as per the surveyconducted by higher education. you know, the body, the reported that like more than 48% of the women are now enrollingfor higher education. Right. And that's excellent exactly. And which is a greatest change by itself. So now, where am I trying to give that, like, most of these people who are going for higher education, the women tend to choose like, you know, different parts of their career. Yes. Okay. There's an aviation that is finance and, you know, there are different, you know, different, I think the sectors available for you to choose,and I'm not going to comment on the rest of the sectors. I've been all my life in the, in the, you know, in the finance sector and finance is like the blood of the organizations. There's a lot of pressure. You have to be like 24 by seven all the time thinking about, you know, what is changing, what are the new things coming up? You know, we have to update because of the law and the regulations, which comes up like, you know, in any country keeps on evolving, right? We just can't live with the same regulation, which was there 10 years ago. It puts you a lot of pressure to update it accustomed. Like, you know, and, and finance has now become a business partner. If you look at the way or the function of the finances looked in across the board. And of course in India too, is like finance is considered to be a business partner. It is no more just collecting and paying checks, and you know, this, this clearing some bills it's considered to be a value partner for the entire organization. And finance now lies with sales, finance now coordinates you know, supply chain,finance coordinates with the technology finance coordinate with social, or maybe for that matter, CSR, you know, it coordinates with the entire organization. And what is my, you know, in my advice to most of the women is be very in your career plan, right? So that's what I'm going to advise people of. We have multiple options. Once you get into a field of finance, to their multiple, multiple choices, you get including a choice to just drop down to choice, to raise up to a next level in your career, the choices in your hand. And even if I want to raise up to a next level, you know, we always believe that, okay, you know, should I stick to this company? Or just because I need a promotion, I want to jump to another company, you know, I'm not doing well therefore, I have to go to another company. So most, I think, you know, most I've seen that, you know, most of the people keep thinking about this hopping in my mind. One has to be very clear in their career and have a long-term plan and be visible, make your own brand, right. If you have to be very successful in the field of finance, you have to be brand by yourself. And this is what I keep talking to my peers, and especially when we are in, you know, in the girls gang, and we talk about, is some people walk up to me and say, how did you do it? Like, you know, I have two kids and managing is definitely a task. Okay, but should we give up answer is no, we should never, we have to just make a brand by ourselves. You're working for the brand is great, but are you a brand by yourselves should be the choice for women. And once they make the choice and they're, self-reliant, you know, they, they know that people are admiring the kind of compromises they're doing, the kind of sacrifices that you're bringing, you know, the kind of initiative that you take up, you will automatically grow up in your career. So don't, I think, see a position and then start working for the position. Start working, you'll automatically get a position. Closing: (19:29) This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard. And you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Neta Meidav: https://www.linkedin.com/in/netameidav/Vault: https://vaultplatform.com/FULL EPISODE TRANSCRIPTAdam: (00:05) Welcome back for episode 94 of Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson, and today I'll be bringing you right up to a conversation between my cohost Mitch Roshong and Neta Meidav. Neta is the Co-founder and CEO of Vault, a reporting platform designed to resolve workplace misconduct incidents. In this episode, she discusses the pitfalls with traditional internal reporting or whistleblower policies within organizations, and how technology such as her platform can enhance internal, ethical reporting moving forward. So without further ado, let's hear their conversation now. Mitch: (00:45) So we're here today to talk about alternative and innovative solutions to traditional whistleblower policies within organizations. I'd first like to set the stage for our listeners and kind of explain the why for our conversation. So can you share some examples of activities that would require employees to act as whistleblowers? Neta: (01:04) Sure, of course. I'm happy to do so. Maybe first it would be helpful to distinguish for the purpose of this conversation, between whistle-blowing and internal, reporting. I think it's important to explain that, the way we see it, whistleblowing is the act of reporting misconduct or ethical breaches externally. For example, to an enforcement agency of sorts like the SEC, whilst, internal reporting is really what, we want to be talking about today and the process which we want to fix and optimize, for, for everyone's benefit. So when we talk about kind of activities that would require employees to act as whistleblowers, I think that the past year showed how that category for internal reporting has it has expanded. So, we of course consider the traditional corporate and financial fraud and corruption issues that require people to, come forward and report, and only today, I, woke up to, the interesting article on the Wall Street Journal about, Volkswagen, which I'll, I'll come back to, later on in this conversation, because I think it's, it's crucial, but the things that happen in every organization, that require, to kind of surface up concerns and, and make management aware. Mitch: (02:43) So then in response to these activities and the various things that go on within an organization, what are some of the traditional solutions or policies that companies have in place, whether it is the internal or the external, like you mentioned, and what are some of those normal outcomes in your opinion? Neta: (02:59) Sure. So I think, you know, I think company’s are largely trying to do the right thing by saying, come forward to us internally. Speak to your manager speak to someone in the organization, speak to our compliance office, but if you cannot, here's a hotline for you, right. And that's the, the traditional mechanism that we've seen for decades that was, you know, became specifically popular, due to, the Sarbanes Oxley Act and the requirements on, on a third party operated whistleblowing platform that was put in place back in 2002. The issue with such legacy solution such as, third party hotlines is that number one, they don't really do much to build trust, right? They're not helping with building the internal trust that we need to see today, in every modern organization, because essentially what they're saying is if there's an issue, well, call this call center and report a problem, and the company will communicate with this call center and pick it up. But here's an intermediary for you and this is how you need to come forward because the act of reporting is just so scary and difficult, and so here's, here's a route for you. The second thing is if you look at the data and the statistics, they actually tell you that hotlines are in many cases, not only are there not the solution, but I would say that they're part of the problem, because if you look at, the global business ethics survey that was published this year, it talks about, the fact that only 6% of all cases that are reported internally in corporate America are reported to the hotline. In other cases, you find, so one of the biggest providers of hotlines in the world, I was talking about 11% of reporting happens to its platform. So that's a very low number, and that comes to show that people essentially do not really trust that option, and do not find it as a, as an optimal solution for when they are experiencing something that is in fact very difficult, to come forward and speak up about. And I think that is perhaps one of the reasons that we're seeing, the Department of Justice just published its guidelines a few months ago, to measure the effectiveness of your ethics and compliance program, and, now it's time to do so because humanity has moved on and so did technology, and there are other ways to create today. And there are other ways to ensure that people feel like they're comfortable, in, in coming forward and reporting misconduct when, when and where it happens Mitch: (06:10) So let's talk a little bit more about your thought process when it comes to this whole situation here. Obviously you looked at these outcomes and recognize there's a gap or there's insufficient resolutions going on. So what did you really try to come up with as far as a need that you recognized when evaluating these outcomes and where did your thought process take you, before we get into these actual innovative solutions? Neta: (06:36) Sure. The few guiding principles, that have guided us in looking at this is that we need to look at, these legacy solutions and processes that are in place, and we need to completely, reinvent them by putting the employee at the center of the experience, right? So we need to look at the solution from the outlook of the employee, because essentially we want to encourage people to come forward and report more. So when we're thinking about creating this new employee centric experience, we need to consider several things. Technology is just one of them. It's really, it's an, it's a very important element of it, but it's just one of the elements. And indeed, you know, this we're, you know, the year is 2020. people communicate through their phones through, apps. They're used to digital solutions that are serving them. That's how, that's how the workforce is communicating today, and it's important to bring those solutions forward, to meet, uh, where, where we are and to meet your employees where they are. So that's, that's the first element. The second element is to do with trust and, and there's, you know, that's really important to highlight that trust can only be rebuilt if there is a direct communication between reporter and company. Be it, if the employee is anonymous or not anonymous, it's really important to create that trust internally, and we can do that by taking the intermediary outside of the equation and empowering people to come forward and report.  The third element is to do with psychological safety. So one of the things we looked at with our technology is not only how you create a sense of, you know, not only how you digitize the old ways of reporting, but how you can really create a sense of psychological safety, and, empower more people to report who would have otherwise not reported misconduct when they experienced it. So we were thinking about how can that be created, and  recreated the technology in a way that empowers people to speak up still safeguards everyone's data and privacy from each other, but ensures that people have that sense of, what we call a blind network and that being part of a network of other people, and the ability to come forward and, and report, jointly. And that psychologically, that creates a very, a very meaningful effect on people, willingness to come forward. Mitch: (09:28) So let's get into the actual solution, now. What are some of the new internal ethical reporting practices that you identified? And I know just taking a step back, you talked a little bit about technology, but, how exactly is it being utilized in this process to better support the employees that you're targeting? Neta: (09:47) Sure. So maybe I'll start by describing it from the employee side of things, because our, our platform is indeed an end to end platform. So it services the employee, but also the employer in managing more effective and timely investigations, from the employee perspective, Vault acts as a safe space. So just like the name suggests it's a place in which, they can create safe, a safe, record of an event that they have observed, or experience at work, including the opportunity to, read any of the companies, policies or any of the content of the company wants to, push, to the forefront, of the app. So essentially employees can create safe records, save evidence of any events that happened to them, such as screenshots or any other events, and our technology would then timestamp that record on the employee phone. So that timestamp means that when the company investigates the case, they have full visibility into the date in which the record has been taken, even if there's been quite a gap between the time that the event has been taken and when it was reported. And that is very much there to assist the investigation, in terms of its quality. When it comes to coming forward, there are different ways in which employees can come forward and report misconduct, but they're all at the end of the day, they're all internal, right? So you would report to someone within your own organization, and those different ways are, anonymous, not anonymous and a third, route is called go together, which essentially means I will submit my complaint if I'm not the first or only one to be experiencing this issue either by an individual or experiencing a problem that I've just observed. And, our technology then connects the dots on these repeated patterns of harm when a threshold of two or more is being met. It's being released to, to the company. And what we found is that people are up to eight times more likely to report knowing that they're part of a wider group, knowing that they are part of a pattern. So that's an extremely powerful tool for companies that really want to know what's happening at the stern of the ship. Additional innovation that is really important is that when people do come forward and report, they have the opportunity to have direct channel of communication with their case managers. So it looks like, any messenger software on your, from your app. So it would remind you of your WhatsApp or your, Facebook Messenger, but it will maintain your anonymity if you chose to come forward as anonymous, but it would still allow the company to ask you as a reporter for any additional information and anything else that they need to know, and send you any message that they need to send. And that is a direct, again, a direct channel, which became very, very important, especially during COVID times when people's appetite of reporting is even more reduced than usual given job insecurity and the, and the volatility in the market. So it became an incredibly important channel for people to communicate with their employer be it anonymousy or a name. Mitch: (13:39) This is all really interesting, and I'd like to keep talking about this, but I know we need to wrap it up. So I just have one more question for you. I know you mentioned employees are 8% more likely to report cases, I believe is what you said, because of being able to create or connect these patterns. But do you have any other data, you know, maybe some resolution data or additional, additional usage that you could share with us, and are there any other possible future improvements to this internal ethical reporting practice that you're considering at this point in time? Neta: (14:11) Sure. So I mean, we're, you know, we're very cautious on data. One of the things that you should know about us is that actually we collect as a company, very little data, on our, on our customers. We've, taken a very, very serious approach to data privacy. And we respect, the fact that one of the advantages of using a technology as opposed to a third party service is the fact that you can keep things to yourself as a company. So we indeed we collect very little data, but one of the things that I can share is that, by using, by putting vault in place, we always see an uptick in reporting. We, it's not, you know, it's not, no one needs to fear that it becomes something, that is overwhelming, but there is always uptick in reporting. And that's a good thing. That means that, that essentially, employees are entrusting the system with their misconduct stories and be able to come forward and report ethical breaches when they happen. What we also see, and that we know, clients are telling us is that usually the fact that the trust is happening is not all due to just the mere use of the app. Though of course, that's really innovative and helpful, but it's the fact that your employer has put something like this in place and communicated about it the way they did. That makes a huge difference for people,people's perception of how important this issue is to their employer. And, that on its own is a big encouragement for people to come forward and report. So, you know, intention matters and it's a great opportunity, to say to your employees, your people, we're not just taking a box here, we really are interested in hearing you and we're giving you the best opportunity out there to speak up. Closing: (16:22) This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Jolene Lampton: https://www.linkedin.com/in/jolene-lampton-b40127164/IMA's Ethics Center: https://www.imanet.org/career-resources/ethics-centerFULL EPISODE TRANSCRIPTMitch: (00:05) Welcome back to Count Me In. IMA's podcast about all things affecting the accounting and finance world. This is your host Mitch Roshong, and today you'll be listening to a bonus episode featuring a conversation about Global Ethics Day. Jolene Lampton, Professor of Management, Accounting, and Area coordinator for MBA and Accounting Programs at Park University, joined Count Me In cohost, Adam Larson, to talk about the significance of ethics and values. Jolene is also a member of IMA's Committee on Ethics and was kind enough to share her perspectives with us on this very important day. To hear more, keep listening as we head over to their conversation now. Adam: (00:47) Since we're releasing this podcast on Global Ethics Day, I wanted to start out by asking why is this day important, And what does it mean to you? Jolene: (00:53) On this global ethics day, I believe it is a day for all of us to search within ourselves, our beings, to bring our values to the surface as we think about a common set of values. People with high self efficacy have conviction within their beings to do the right thing. This in turn gives them confidence. They do not second guess their own intentions. They act in accordance with their convictions. People with high self efficacy can speak about it. They can articulate their values. This is called efficacy. It means you have the ability to produce an intended result. It is intrinsic. It comes from within one's being, your persona. With  conviction, you feel willing or even compelled to speak your beliefs. This is a point where you can exude confidence to others, and this will show in your behavior. On the other hand, people with low self efficacy cannot do this. Rather, they doubt themselves. They are intimidated. When speaking with others about a situation, they do not feel confident on how to act on their own convictions. So you want to achieve high self efficacy. You want to feel good about yourself and be motivated and confident to take action accordingly. On this global ethics day, I hope you will examine your own values and start to speak about them. Adam: (02:56) So when we look at ethics from an organization perspective, how important is it for an organization to have its foundation rooted in those ethics? Jolene: (03:06) Your values are rooted in your internal beat. They come from within. Even before you go to work for an employer, you should check on their websites to see if their values align with your own. And if you can't find the employer's core values on their website, it's a great interview question. You should ask them what their core values are. When this alignment is achieved. That is the best fit for both the organization and the individual. It's an ideal cultural fit. You want to work for an organization with your same core values, your intrinsic values. Adam: (03:57) So you just mentioned that, you know, you want to work with an organization that has your same values and organizations are made up with lots of different people, and how can someone build the confidence to do the right thing and to speak up when they need to? So let's say they've done all that legwork that you said the organization meets up, but then they notice something that doesn't, that doesn't match up with their values. How do they build that confidence to do the right thing? Jolene: (04:22) Human beings have special abilities related to learning that sets him apart from other species. Social cognition theory says we learn by modeling and imitating others. Think about it. This is how your own youngster learn to walk and talk. They looked at you as a role model. Then you grew up and you mastered performance, gaining some morals and we acquire the ability to function independently, which is a good thing, and we gain the unique ability to self reflect, which gives us the ability to have self efficacy, which gives you confidence to do the right thing. Giving Voice to Values is an approach that will let this happen more readily. Giving Voice to Values was created by Mary Gentilly in 2010. This approach advocates that you will speak your mind when you know what is right. What you really should do is prepare and practice for actions and not just any action, but the difficult, hard, and risky intricate values-based actions. This is a first step to building ethical muscles, which will give you confidence to act on your own values. The habit of voicing one's values takes practice to make our values just come out instantaneously. So start by crafting your own scripts and responding to others, when you feel compelled to come up with a response, let's begin with the scenario of shared values. When talking about cheating in a cheating episode that you witnessed. There is a shared respect for academic integrity that you should work to build upon in order to reduce cheating behavior. Giving Voice to Values empowers anyone and all of us to voice a sense of doing the right thing. This scenario requires for you to look clear eyed and honestly about the act of cheating. Who we are, who we have been, we can be. To speak up about or wrong, takes a kind of courage that requires a special set of skills like those needed to speak up when you see, when you witnessed your first episode of fraud in action. You need to prepare your script in advance and practice that message out loud in front of a mirror. Remember in such instances, you may need allies and supporters. You may even need to convince your own boss or other official, and you will need credibility with others when you speak or take action, or you may need to just pause and gather more data to make a compelling case. As a mature and capable performer. You are the determinant to take action or select a time after which you've gathered sufficient data. You will decide. If you've prepared scripts in advance, you develop your ethical muscles, just like a weight builder develops muscles. This takes practice a lot of practice. This is what Giving Voice to Values does for you. It prepares your ethical muscles. So you normalize your behavior. Individuals who have exercised their ethical muscles often enough find that it becomes a part of their own self-definition the trick is that when it's normalized and you come up with a stressful situation, you will, calmly react and respond to the case at hand, if you practice voicing your values. This is the position for your behavior to be values-based, and it'll give you a can do attitude. The more you begin voicing your values, the better off you will be. Adam: (09:16) So as each person finds that ability to bring that voice to the values, and it's important to know what your values are, how can each person see how their values align to the organization that they're a part of. Jolene: (09:30) You should know, your organization's values. Core values should be on your company website. They should be in your policy and procedure manuals. They should be in on your bulletin board or other requisite sheets. And more importantly, they should be in your mind. Begin today, looking for your corporate values and speak about them in your workplace. As you work today, examine how your work reflects your core values. As you're performing reconciliations or preparing reports, think about it. Start sharing with others in your own department, share with your supervisor and your colleagues. They too should be reminded that procedures should align with core values. Be a culture champion in your own organization. In the book, The Culture Engine by Chris Edmonds, you found that 70% of respondents to a value survey did not have values in their organization, and of those 70%, only about half of people could identify their own values and their organization. On this Global Ethics Day. I hope you will find a way to see your values and how your work aligns with those values and start to speak them today. Closing: (11:17) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you liked what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Loutfi Echehade: https://www.linkedin.com/in/loutfi-echhade-5b3601/FULL EPISODE TRANSCRIPTAdam: (00:00) Hi everyone. Thanks for listening to another episode of Count Me In. I'm your host Adam Larson, and this is the 93rd episode in our series. Today's conversation is between my cohost Rouba, and IMAboard member and financial advisor, Loutfi Echehade. Loutfi is a seasoned financial advisor to family businesses in Saudi Arabia and the region and joins Count Me In to talk about the implications of COVID-19 and the current economic landscape. For advice and how such owners can maneuver their businesses. During these times, keep listening as we go to their conversation now. Rouba: (00:42) So, let’s get straight into it. I’m excited to get your insights on the family business segment in the region. So analysts and economists consider family businesses to be the lifeblood of the Middle East region, and crucial to the region’s economic prosperity and stability. Why do you think that is? Loutfi: (00:59) Well I mean, you know, family businesses, as you indicated, I mean it represent at least 80 percent, some statistics say 85 to 90 percent of the economy is driven by family businesses. In our region, the largest family businesses are the most critical. They play e a critical factor not only in employment and number of employment, but in contributing to the local economies. So, they drive the whole business, you know, and this is not only in our region. Globally, family businesses really are the main drivers of economic developments, in most of the world. Rouba: (01:46) According to the Middle East family survey conducted last year, they found that 78 percent of family businesses report economic environment as their top challenge. How does such a limitation play out when you are facing one of the biggest challenging moments in the economic history since the 1930s, COVID-19? Loutfi: (02:09) Family businesses are just like any other businesses. They go through, of course, cycles and they face these kinds of challenges every once in a while. We had a financial crisis in 2007 and in 2008, before that we had the September 11 events, and before that there were a lot of events and major developments in the world. Family businesses, just like any other business, they were able to sustain and maintain their structure and business, primarily because they have certain features that allow them to do that. The flexibility, transparency, level of commitment, long term commitment. But still, they face external pressure, just like everybody else. I work on a number of family businesses in the region, particularly in Saudi Arabia, and the pandemic, COVID-19 has a significant impact on their operations. So they face the same thing just like any other business. If they are one structure, they can manage to go through these events, major events, and heavy burdens in the future, you know. Rouba: (03:34) How equipped are regional family businesses for this huge task and what are some of the best practices you have noticed from your practice? Loutfi: (03:44) By their nature, family businesses are family-oriented, family-directed. They have a clear strategic planning, they commit to the family values, the family culture. So there weree ups and downs for most of their lives, business lives. They go through a lot of turmoil, roadblocks, headaches, pressures. If they are really well managed, and have proper structure, and that’s where comes family governance. If they really have proper family governance, that unites them, that puts them together. As I said, they are not like the corporate world, like businesses for profit. They don’t focus just on the short term, they focus on the long term. There is also the level of loyalty. In family businesses you find a lot, of course, a lot of family members being united and being committed, but at the same time, there a lot of non-family members aligned, committed and work aggressively, even sometimes more than the family members. So, you have that combination of commitment to the long term, not to focus on the short term, the willingness, the desire, the interest, and the commitment to continue to the following generation. And then they have the loyalty part which also drives them into the future, and into the long term. The way I see family business, just to give you an example, there are a lot of companies now in our region and globally they are firing people of course. They put people on furloughs or extended long leaves and they cut salaries. The family businesses that I deal with face the same problems, but they manage, you know, in a way, to keep these employees with them because they have been with them during tough times, difficult times, as well as in good times. So they look at them as really part of their commitment not only to their employees but to the society in a whole to the community. And that is a little different from directional-wise, different from other businesses. Rouba: (06:24) You noted governance, which was going to be my next question. You’ve been providing advisory to family businesses in the region for many years, how committed are they to governance and do they value it? What has been your experience wit this essential aspect of the sector, as you have mentioned as well? Loutfi: (06:44) We are on a journey. In the Middle East, you know, of course you know, if you talk about governance, corporate or family governance, not many people will understand, not many people will really decipher it, if you wish.  Everyone will give you different. It did not really have a lot of meaning. But you know, things have changed, I would say in the last decade, in the last 10-15 years, things have changed. In the corporate side, governance regulators have put governance regulations, protocols to ensure that corporations have proper structures to maintain their operations as well to really ensure that they provide right and correct information. On the other hand, the family governance is also something that is a process, a set of protocols.. Most family businesses they have hurdles they understand it, but if you are to tell me, are they committed to implementing it, that’s still, we still have a long way to go. I know a well-known large number of family businesses, well known family businesses. They have already proper structures, proper family governance structure. They have what we call a family constitution that defines roles and responsibilities of family members who share on the corporate side, either as board members or on the C-suite level. They also have what we call certain committers to ensure that there is proper alignment between the corporate side and the family side, and also defines who can be employed in the company and who cannot, the matter of dividend, conflict resolution issues, succession planning, all these are critical components of ensuring a successful and easy and smooth transition into the following generations. Rouba: (08:59) With a GPD contribution of more than 60 percent, workforce contribution of 80 percent, a broad range of sectors including food and drink, manufacturing, construction, education and health, and trillions of dollars in revenue, how will the current situation impact employment within the family business segment in the region, and what are governments doing to support and to mitigate this impact? Loutfi: (09:25) Of course, you know, the pandemic, COVID-19, as we said earlier, has significant impact on all businesses, all over the world. In the US, we have unemployment reaching over 14 percent. Although I don’t have statistics on the Middle East, like in Saudi Arabia and the GC, but I see a lot of companies that are working at 20 percent or 30 percent capacity. Yes, all are suffering, and all are going through the same issues, of course the focus now is on really maintaining, as much as possible, on moving and operating with what we call the leanest type structure. So, meaning just focusing on cash-flow positions, reducing the impact on the working capital gap, ensuring that they have bloodline over credit, and the governments on the other side are doing. They have initiated a lot of initiatives, put a lot of programs, to help small and medium size companies. That came in handy and it has a lot of positive and contributing factors to maintaining these companies to survive, to continue. And of course, there is also the fact that banks and financial institutions have been a little bit lenient and flexible in extending loans to these companies and waiving some of the covenants, if you wish, in some areas, but it is an extremely difficult and different kind of animal we are fighting now and the fact that it is prolonged, it will have significant long-term repercussions. These companies, family businesses or others, will have to just ensure that they have a proper, well-designed, and carefully planned budget and forecasts for the near future, at least for the remaining 2020 and 2021. Rouba: (12:00) Surely! I mean, some legacy businesses have endured the unendurable in some cases. But, in your view and experience, how are they coping with digitization and digitalization and the whole digital transformation altogether? There was a survey that was conducted pre-COVID-19, that stated that 44 percent of family business-owners are committed, 63 percent of them have confirmed that they do need more innovation. But how likely is that commitment to manifest in-light of post-COVID-19 scenario, even though most businesses are operating remotely for the time being? Loutfi: (12:39) The digital transformation era has started long before COVID-19 and many family businesses, leading family businesses, they have already been on that journey. They have done a lot of the steps and initiatives required, to move into the digitalization era. Of course, most of the other family businesses, I would say, are still lagging, they are still behind. They will have a difficult time if they really do not invest in improving in innovation, in new technologies, artificial intelligence, machine learning. All these initiatives and platforms are being introduced and I know some family businesses, as well as other businesses, to be honest with you, they have already invested in that, and I’ve been on their board meetings just a couple of weeks ago. In one, we actually talked about stopping some of these initiatives where we invest in new technologies, new programs, to enhance the business on the technology side, and I said we are not going to stop these initiatives because they are very important, they are more critical at this time than ever before. Most of the retail business now is done now, as we know, online. If you look at the businesses that are thriving now and those that are lagging, you will see that the technology innovations and the digitalization have really helped those that have already invested. This will continue and there is no escape from it. I think that if we have learned a lesson from this pandemic, it is that there will be more significant investment in the digital areas and in the technological innovations and that’s the only way to go, because, as we know, it affected every facet of life, it affected every business. Rouba: (14:58) In some of the recent discussions that we’ve had over the last few weeks and few months, there has been a lot of emphasis on cashflow management. How does that work for family businesses and what have been some of the lessons learned, from where you stand? Loutfi: (15:13) One of the, one of the key, uh, attributes or key features, , success factors of family businesses is that they, they don't focus on the early distributions of dividends. I have seen a lot of companies. If you look at the balance sheet, you will see that the capital is, let's say an X a month, and then the retained earnings figure is like five times or, or, or even more. What that means is that, you know, it depends, you know, they have never focused on just making distribution as part of their normal process. We know that corporations, you know, we'll distribute, we'll have to distribute dividends to shareholders almost either on an annual basis, semiannual or quarterly. Family business, don't do that. At the same time. family businesses by their nature more resilient, their decision-making process is much easier. The level of commitment is there, so they can manage and control the flow of their cash much smoother much easier and more direct. So in the family business side, where I have served on the audit committee, they look at the cashflow almost weekly, because that is very, very important. They want to ensure that they have enough cash really to manage their operations. Some of the matters, initiatives, that they have done is of course not to cut salaries, but they let their employees take their unearned vacations and also maybe have some time-offs. This is on the salaried side. On the other side, for example work with the suppliers, long-term suppliers, and vendors on extended credit facilities. Instead of paying every 30 or 60 days, they will really try to manage a more flexible payment schedule. They also work on reducing unnecessary costs, maybe closing some unessential/nonessential businesses or operations. They take a lot of initiatives. As I said, also, they kept down on their withdrawals, they stopped paying dividends to themselves. They do not take salaries. So all that helps a lot in at least managing the situation until things improve. Rouba: (18:05) You have covered quite a lot of ground on that one and what I wanted to ask you in my last questions is, what advice do you have for family business-owners in the region and is there light at the end of the tunnel? Please say yes! Loutfi: (18:19) Yes. In life, you know, we have lived through some difficult times and the world goes through a lot of turmoils once in a while, and I am sure that we will get out of this. It is not easy, it is not simple, and it is costly, unfortunately. Lives, businesses, human beings will suffer all over place, all over the world, but we will get out of it. Life will go on. My advice to family businesses and for all other businesses is to really focus on the long term. Stay the course. Stay focused on what has made you successful so far. If you read the history of well-known family businesses, they have gone through disruptions, they have gone through foreclosure. Some almost went bankrupt and they came back and thrived, and  became much stronger. Just keep your head up and keep your focus on the future. And yes, there is light …. Rouba: (19:18) … at the end of the tunnel. Loutfi: (19:18) There is light, and there is going to be bright light. Rouba: (19:57) Amazing! Amazing that is what I wanted to hear. Brilliant! Loutfi, thank you so much for your insight, I am sure that a lot of family business-owners and, as you said, a lot of regular business leaders in the region are going to benefit from this conversation. So, thanks again for all your time. Loutfi: (19:57) Thank you, it was my pleasure. Closing: (20:17) This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Liv: https://www.linkedin.com/in/livwatson/Contact David: https://www.linkedin.com/in/david-w-29627882/IMA's Paper - "A Digital Transformation Brief: Business Reporting in the Fourth Industrial Revolution": https://www.imanet.org/-/media/e8faf3260e904bf5984fff9c9cf70382.ashxFULL EPISODE TRANSCRIPTAdam: (00:05) Welcome back to Count Me In. IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson, and I'm here to bring you episode 92 of our series. Today's conversation features two guest speakers, Liv Watson and David Wray. They joined my cohost, Mitch to talk about a paper they coauthored with others about digital transformation. The paper, A digital Transformation Brief Business Reporting and the Fourth Industrial Revolution, highlights the staggering compliance costs and boldly calls for digital transformation across businesses. Liv and David share their perspectives with Mitch as they share many facts and examples of what businesses should do to maintain compliance through the data revolution. Let's listen to their conversation now.  Mitch: (00:55) From the research paper, you classify six reg data ecosystem challenges that are contributing factors to the material costs and risk in global compliance that you discovered during the Workiva research. Is that correct?  Liv: (01:08) Yeah, not that the paper really was exhaustedly addressing all of the spectrum, but some of the key challenges for companies to produce regulatory reporting is obviously set in their reg data. The regulatory data, they got it captured that sits in silos in different types of systems throughout the organization, and then sometimes as a reporting goes beyond just financial systems, they are integrating non-financial data. That data is not hardly accessible in any system. So the data processes being able to access data is kind of key to be able to digitize that data. Some of the challenges are the data types, right? You have different data types, different formats of data. So they sit locked up in documents. So the data, even if it's stored digitally, it's not accessible. Standards and supporting documents. I mean, you have many standards to follow many frameworks to follow multiple regulators, asking for multiple data points that are aligned with different supporting documents and regulation. We need to digitize these documents and they need to be machine readable. They need to be discoverable. They can't just be digitized into a word document. Technical standards. There are XBRL. There is XML, there is Excel, there is Word, there is PDF. When regulators ask for data, they need to start considering one data format because, and in machine readable way, because just aggregating all of this data and then try to create documents and report both internally and externally. There's some mission marbles. There are many different ways. Some allows the software vendor to directly connect to these digital repositories, but some you have to upload some, you have to fill out an online form. We need one way or connecting, and then the digital way and data definitions. Let's not forget that. Data definitions is just an issue all around standard sharing many data definition are the same, but mean something different. Some are the same, but describe the front. We need the digital transformation in a central place, just like a library to register these data definition into taxonomies so they can be discoverable machine readable. So during this paper, we discovered some of the key points that is costing industry today. IFAC recently said  over $780 billion a year costing the industry just to address many of these problems that we discovered in our research. So yes, quite a technical challenge that we still have today, Mitchchell, thank you.   Mitch: (04:33) Well, thank you for that, and with this whole data revolution, you know, I'd like to direct this question to David as the seasoned finance leader, I know you were both in a publicly traded and privately held Fortune 500 companies. What is your personal observation on the willingness of compliance teams to really embrace this whole digital transformation?   David: (04:56) Thanks, Mitch. It's a great question. I mean what I've noticed throughout my career, and I think it's really accelerating the last few years is that users on the ground are really beyond crying and now screaming out for digital transformation. And that's now being echoed in a very loud way by CFOs. In fact, in 2018, Accenture conducted a study, which is called From the Bottom Line to the Frontline, and they found that about 80% of CFOs said that control compliance and reporting is largely going to be digitized because they want to free up those resources to be able to business partner. That's where they see value. Additionally risk and compliance data accounts for almost three quarters of all of the data requests. So the issue is definitely not going away, and of course it naturally prompts the question around how can we digitize the end to end process, so the talented finance resources can in fact be deployed to better support the business and drive value for organizations. Our paper really captures this at its most basic level, right? The ultimate reporting objective is really trustworthy auditable accessible and machine readable information that is definitely relevant to user groups. And to do so, we've gotta be near real time as Liv alluded to earlier. It probably goes without saying that any transformation success is really going to depend on robust data governance and each business reporting data and compliance framework as well.   Mitch: (06:20) Thank you, David. And now leave, I'd like to pose the same question to you, but from a software service provider, I know you were supporting roughly three quarters of the Fortune 500 companies. What are your observations on the willingness of companies and their compliance teams to embrace this and the data revolution as well?   Liv: (06:38) It's an interesting question because as our company tried to build a compliance platform that allowed companies to digitize their processes 10 years ago, we spent most of the time educating the market, what the cloud was, because sitting on system on local hard drive and data setting, you had to change your mind and trust the cloud. What we are seeing 10 years later is something that a cloud is no longer an issue. And now with the virus and these externality that must allow data to be accessible from anywhere. We are seeing a huge change in the demand of, of the solutions that can bring this, technology transfer nation, because business reporting has never been more complex. If you were to kind of just even talk about the cost of compliance and how much data that is being generated today, just in the last five years, 90% of the data has been is being generated. There is a $221 billion last year and spent on data management. The risk of noncompliance and fines are getting much higher. So the challenge is good data governance is what is going to be a use differentiator to the profession and this, and David I also say I am a, new, competency frameworks allows for a lot of these new technology skills says that the profession needs to adapt to be able to drive the digital transformation. And in our research that David, my coauthor here and we did, we also discovered speaking to accounting professionals that yes, they know they need to change and transform and software and embrace the cloud and digital technology like digital distribution blockchains. And so with that, I do think that we are reached a total new milestone where  driven by the fact that we need to have good data quality from anywhere and our profession as accountants. We need to step up and take that opportunity to not just be professionals, but also become good data governance stewardess within our organization to reduce the cost of compliance and data management and not add to the cost of compliance by storing data in local hard drive. So we need to start thinking about how that data we produced is repurposed throughout this life cycle. Thanks again, Mitchell.   Mitch: (09:51) What you're point right there about management accountants and really the whole response is a very nice bridge into the next question that I'd like to bring back to David. I know in the paper you made a bold statement and really valuable point by sharing your perspective that you believe accounting and compliance professionals who master this critical data in internal and external reports, it's really going to be invaluable, come the fourth industrial revolution. So I'd like you to share a little bit more about that perspective, and can you tell us what that really means to the management accounting profession?   David: (10:26) Sure. Thanks Mitchell. Let's really take a look at this from a reg data centric approach to illustrate the points that Liv is calling out and the ones that we've made in the paper together, along with our other coauthors. So digitization is really inevitable, right? And it's going to create much greater emphasis on data management and data governance, which is naturally going to fall to the custodians of this important asset in terms of accounting and compliance professionals. That's where it's just going to naturally sit. So that change means that the compliance and reporting environment is inevitably going to create demand for a holistic, connected and real time monitoring and reporting solution. And that's exactly what Liv as I alluded to a little bit earlier. So the specific implementation of reg data life cycles will of course vary by entity, and it probably is fairly obvious to the listeners and the reason for that. So quite simply, because it's going to depend on the nature of the data, the system disparity, because we all know that enterprise data is often housed in multiple systems in very different data types and in multiple formats. And it's further going to depend on the quantity of the data and naturally the way that the information is consumed. So there were a lot of moving parts around this and what that means to accounting and finance professionals is there's going to be a need to contribute their unique skillset and insight at every single stage of the data life cycle, and that's because they need to be able to ensure that as mentioned earlier, that the data is machine readable, it's auditable and it's fit for purpose, not only through this revolution, but well, beyond that point. So for the profession, digitalization really means acquiring new skills and data science, data visualization, and of course, new technologies. And we see that in all of the accounting bodies, including IMA, adapting, the educational programs to reflect that. So long gone are the days when the roles of accountants and finance professionals mainly revolve around accounts and financial reporting. Today's accounting and finance professionals are really expected to provide value. That goes way beyond the original scope of work. And that's really the challenge that we're all grappling with today. We're called upon as a profession to provide insights, which depend very much on the quality of the underlying data that's being processed or has been processed, but we're also expected to apply knowledge and experience, partner on business strategy, support the business to achieve their targets. And if that's not enough, we're also relied on to develop mechanisms, to review and monitor, to measure business performance or offer proactive and real time advice on either internal or external pivots that need to happen to avert those nasty business surprises that every CFO dreads. So basically the pace and scale of change is taking place around stakeholders, coupled with the increasing availability of tools and techniques such as machine readable, data cloud computing, machine learning, business analytics, big data, blockchain, distributed ledgers amongst other things, and they provide the means to effectively adapt to new key management and strategic roles. So the world has, we know it is becoming so much more exciting for accounting and finance professionals. Thanks for the question, Mitchell.   Mitch: (13:37) Oh no, thank you for the response, and in the middle of that, I know you said beyond this revolution, right? It's not just now it's ongoing, and I always like to wrap up these conversations by getting the speaker's perspective on their thoughts in the future. Right? What does the future of the profession look like? What other trends will we see in the industry? So I know you shared with me, the World Economic Forum recently said that this revolution, all of these emerging technologies, unprecedented connectivity, there's going to be a lot more to come, right? And I know you, I believe it was Liv who started mentioning XBRL and you just talked about innovations like blockchain. What is next? Right, I guess that's the big question. And I'd like to get both of your perspectives on this. I guess we could start with David here, but what is the next wave of reg tech or soup tech supervisory technology innovation, and what else do you see coming for this profession?   David: (14:34) It's a great question. And I, I love looking into the future, that's such an interesting part of, of being creative. So inevitably I really believe that data sciences and the underlying technologies that are going to be needed to both analyze understand, and to really make sense of the vast amounts of data are going to create real challenges over the next few years that are frankly, going to make the current environment look akin to stone, tablets and chisels. We really have a golden opportunity to leverage the emergence of artificial intelligence and to create smarter solutions in a way we never dreamed possible in the past. So for instance, if we look at what's happening this year with COVID-19, it's raised public consciousness in several really important areas like climate change, healthcare and social responsibility. So our paper actually can become an enabler to help accelerate the right conversations and create that kind of discussion, which will lead to meaningful action. Management accountants need to then embrace these new skills and continuously upscale themselves, not only to keep up, but frankly, to get ahead, and the world is definitely not slowing down, Mitchell  Mitch: (15:43) Well, those are great points, David, and thank you once again, Liv, I'd love to get your perspective on this as well.   Liv: (15:50) Well, as I always say, we looking into the future is kind of the exciting part, right? But it's still go backs to the basic on, we need data. We need that data to turn into information. We need that information to turn into knowledge. We need that knowledge to bring insight, and then we have to turn that into this system, right? And what is the underlying basic infrastructure to digitally transform that, because these tasks are going to be just like the rules that we sit and read and proclaim to be our domain skills. So those going to be rules as code, coded into the machine. And, and so we need to, like David said, our whole profession is changing, our skill set is needed. Then as a board member of IMA and someone that was very involved with the framework for our skillsets to be adapted, we really need to become more than just domain skillset owners, because those rules and regulations that we kind of claim to be the expert in, they are going to be rules or code. So we need to be able to bring that last mile, some of the data information, knowledge, insight, and this stuff. But if I look into the future, what smart regulation will be, it will be not what we see today. Auditing is like shooting the wounded. We need continuous auditing and monitoring. Contracts will be digitized into smart contracts. So where is the future digital transformation? This train has left the station. The question, which one of us are on board.  Mitch: (17:45) Well, Liv and David, thank you very much for your time. I know you contributing authors, but once again, as referenced the paper, Digital transformation, Brief business Reporting and the Fourth Industrial Revolution. Thank you very much for all of your information and perspectives here. David: Thanks Mitchell.   Closing: (18:04) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Deepika Chawla is a business woman, presently serving as Vice President of a Fortune 100 company. With 27+ years of rich and diverse work experience in Financial Shared Services and Banking Industry, Deepika believes She believes “Your legacy is in the leaders you create and the knowledge you share”. She is a Qualified Chartered Accountant who is extremely passionate about supporting women and the community she serves. Deepika has won various recognitions for promoting Diversity in the workplace & society.  She has been named as one of the 25 most inspiring women in the Coffee Book ‘Big Dreams Bigger Achievement’s and has also been decorated with the Champion Award from ‘We Are The City, Organization in collaboration with EY, for her passion, resilience and tenacity in supporting diversity. She is actively involved in mentoring youth / next generation leaders across organizations & colleges and has attended a number of events at various universities and colleges as a speaker and panelist. A TEDx speaker, Deepika supports multiple NGO’s of Cancer, Education & Thalassemia and is also on the advisory board of two of them. A mother of two children - boy 24 and girl 20 - she recently celebrated 27 years of marriage.Contact Deepika Chawla: https://www.linkedin.com/in/deepika-chawla-181a319/FULL EPISODE TRANSCRIPT:Adam: (00:00) Welcome to episode 90. One of Count Me In, IMA's a podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson, and I'm here to introduce you to our next featured guest Deepika Chawla. Deepika is a senior finance professional and qualified chartered accountant in India. She currently serves as the vice president of a fortune 100 company and has over 27 years of diverse work experience in financial services and the banking industry. In this episode, she speaks with my cohost Rouba Zeidan about her journey to the top, and the challenges she and other women face in the finance industry to hear Deepika’s, perspective on how women can make the most out of their careers and finance, keep listening as we head over to the conversation now. Rouba: (00:55) So good afternoon, Deepika, thank you so much for joining us. Deepika: (01:01) Hi Rouba, thank you so much for having me here to talk something, which I am so passionate about. Rouba: (01:09) Same here. I'm looking forward to your thoughts and your experience. So, women in Asia occupied just 1.1% of CEO and CFO positions and country held positions, according to a 2012 capitalist study, why do you think that is? Deepika: (01:29) Yeah, good question, and really close to a lot of women's heart. So, most of the people feel that women spend more time performing unpaid work in childcare and housework and may not be able to handle a senior position. Remember they feel that they may not be able to handle this a senior position. Not to shatter the unconscious bias that assumes women should be the sole caregiver or associated with housework organizations should really create a safe and inclusive workplace where men feel comfortable being with [inaudible] and do duties and household activities, giving both men and women an equal opportunity to look at their by supporting each other. Now, really from that perspective, it is so very important that that comfort should be there to the women that they can go and work or, you know, they could be CEOs and CFOs because somebody else can do the caregiver job. Now, secondly, as you go higher women themselves have self-doubts and this will come into our conversation very often because whether they can do the job or not, and they hold back because that is very, very important. They have this self-doubt. Should I be perfect before I applied to a job? While men, at the same time even if they are at a 60% at that job, they convince you that they're the right candidate. And thirdly, and lastly, in my mind, you know, unless the top leadership does not drive the message, this may still go on as these numbers, only what you shared with me. Whichever news you're hearing today, whether it is Uber, Fidelity, lots of companies or, you know, otherwise senior women positions are coming up. When you open the LinkedIn these days, you would see one announcement or the other coming. Now that's primarily because the top, you know, the top leadership approach is to focus on the, the women candidate on the CEO positions. So, I think that's really important. And in my early career, I have seen women having children and taking promotions in the same year. So, you need both the women and the company, and of course the men to believe in that they can do it. So really that is what I think. Rouba: (04:07) Makes a lot of sense, actually. I mean, that's, that was a, I'm going to ask you a bit more about your personal experience as a seasoned professional who's been at the forefront of your sector throughout your career. How do you find the industry has changed over the last 20 years? And what are some of the plus points that you've noticed, which mark positive elements of change, evolution and progress. Deepika: (04:34) Yeah. Good question, you know, because, let me share because it's important to let people know, and they say, you know, women shouldn't share the age and I always feel very proud of sharing that. So 27 years back Rouba, I'm 51 now this year, but 27 years back when I completed my chartered accountancy, I was really one of those few women who was trying to enter the finance field and not to an MBA, but see basically like a CPA from US, right, or a CA in India. And when I went on to do my first job, I landed up in a different city from my hometown, and trust me, I went through interviews where they actually called me to say, we don't hire women, and I was in shock.  Big, big financial companies. And, I had just completed my CA. I was one 22 and a half years old, and I was in shock. I thought I was like super. And it had really hit me hard, but really, I'm not going to get a job up to doing such a qualification. And from there to where now the plus points, which I noticed to the journey, which I had, and now where we see, we are creating flexible and adaptive operating models, right? We, as companies, we are actually saying focus on diversity. In India, diversity primarily is gender that, right? And then you go on to other things, but primarily first you're looking at women because that itself is a small number. And today we actually have our own focus, making sure that you have equal number of CVs on the table so that you give an equal opportunity to them, right? You ensure that at least they get a proportion to be interviewed, and then you keep tracking till the end to see how many people were hired and was there, you know, some biasness of making, you know, not having always  men into the positions. So that's the second piece. The first one was creating flexible and adaptive operating models that, which never existed that today you would have a daycare center in a lot of cities, right? Under the place of work, where you can think in nuclear families that I can leave my child and pick it up. Virtual has become a very big reality. This is a good opportunity also that I can work, and I can take care of also.  Third is really drawing on nontraditional resources and partnerships. Where I really want to bring the focus on that, you know, we never used to look at secondary means where we want to get women back, but a lot of finance companies are looking at women coming back, from there, after childbirth, or if they have taken a break for getting married at or whatever. It is promoted, it is really well accepted. Adopting a growth and innovation mindset. Which is from the company's mindset, also a woman's mindset, also, a man's mindset. That, you know, innovation or any kind of growth is not limited to a gender. Innovation comes from a creative mind and women do have creative minds. How do we make sure we get them on the table? So, you know, that's something which is really, really, changing over the time and the way the companies are focusing, which never happened at that time. If you went for an interview, or even after I joined, you know, HDFC bank, one of the biggest private banks, I was the first woman hired in that branch. And I had to make sure by the end of it, I really felt that we need to have more women here. We can do this job great. And by the time I left that branch in two years, we had hired some seven more women. I didn't even know I was supporting diversity. I just knew that people needed a portrait because there was no topic of diversity at that age, right. I'm talking about 25 years back. Rouba: (09:15) Well what do you think triggers this kind of gender discrimination and inequality? For example, in the finance sector, something that you've experienced personally, what is the trigger for it? Where did it come from? Deepika: (09:30) Sure, I think it does come from the fact,-one is of course, I think a big one is from the kind of stereotyping which we did or the culture we were born or brought up in, it is very big one. So, from the beginning, we tell the daughters that, you know, these are numbers are not, you know, this is not stuff for you. Why don't you take something simpler? When I wanted to do chartered accountancy, my grandmother was more concerned, Will I pass the exam, and if I don't pass the exam, who will marry me. She was not concerned if failed, she was more concerned how like it married. So I think it's the culture, you know, the way we distinguish between that, we want to give softer things to the women or the men, or from the fact of the way the children saw how the parents were. Today, when my children are growing up, my son's 25 and my daughter's 21, they've always seen their mother working. I'm a little doubtful if my son would not understand how to support his wife when she's working, because he seen it in his house. It's very important for me to train my son better than my daughter, because he'll not be happy, Rouba, I'm very clear. Because women are finding their space. But that's one piece. It's the society, the culture, I think the second piece is the organizations don't create, equal opportunities, you know, While many leading financial services have created, you know, active steps to promote gender diversity. This behavior has to become a norm throughout the industry. For example, I can give you a very good example of Fidelity, I was reading. That in the United States has found that women want to totally understand what the company's products mean for them, as opposed to receiving the condensed version men commonly want. And you would understand Fidelity gives financial products. So we've always designed the products, keeping men in mind,  they are spending their time with their women colleagues to make them understand what the products are and take the inputs to design the products in such a way. Just look at the 360 degree, how an organization is creating inclusiveness. So, I think that's the piece. And of course, I keep coming back to the fact of women's on, you know, their own ability to put themselves forward. As long as you're good at job, you're approachable, would work well in the team, then you can work well everywhere and whether it's men or women. Now, what becomes the biggest challenges that women in general tend to strive to achieve perfection. Like I shared earlier a little bit more than men do. Now, this results in a lot of insecurities and fear that if can I do this, will I be able to do this? And I start bashing myself up, and I used to do this quite a lot in the beginning of the, you know, career and when I wanted to take a plunge and yes, I can do that. I had to really teach myself, and there was a women's senior leader [inaudible] who once shared with me and you can look it up on LinkedIn, wonderful thing she has shared with me. She said long are the times are gone, when you have to just look down at your work and think that somebody is going to give you the credit for that work. It's okay to raise your head. Know what's happening on your left and right. Raise a hand and say, I want to do this project. I am good enough to do this. These are my strengths. Talk for yourself. Don't shy away. There is no such thing that you can't share your strengths with people, and it's in a modest way. And half of the time we think, Oh, am I showing off and am I holding back? So really three things, society, the culture we are brought in, organizations themselves, how they define it and third women, how they should do it.   Rouba: (13:56) These are very, very sound pillars, actually. Would you say that the finance industry is progressive enough to welcome gender equality? And if not, where do you think those limitations lie?   Deepika: (14:10) A direct answer? Yes, it is progressive. Is it enough? No, there is a lot of work to be done. And, really, I feel that there's a lot of focus which has to be there real focus. So, if I put some numbers to you in 2017 world economic for global gender gap report, female talent remains one of the most underutilized business resources. And in some of the industries and especially finance, it is especially clear that career as the career level rises, the female representation declines. Although,  45% of the financial services, employees, women at the executive level, it's only 15%. And as I shared with you, you know, in 1993, when I wanted a job that was an entry job, and they were saying that, you know, we don't hire women. We just want to be making sure that, you know, you are a woman. My CV said, I'm a woman. And I was like, really mocked about it. Joining a bank and being the only woman in there was something which I really wanted to challenge. And, you know, really taking perceptions, which I shared, which becomes stereotyping. These are the limitations. Women are not good with numbers, right? That's something we've always talked about that.[inaudible] And I really, exactly picking that up. They, they are the best managers. They are so organized. They can multitask so well. They can look at multiple funds at the same time. What have you seen? And if you look at the results, the numbers results in any of the examination, you will see them in topic. It's only when you are trying to reach the higher levels. I think the, the marketing standard, you need to really get up and say, I can do this, hold some back. So, the second is that, you know, in the society, women really should have more responsibilities at home. If we can make that equal and we can let the talent come out and work on with the site, I think it will make a huge difference. And a big lesson page really thinks that they may not be able to do higher roles. Like I shared with you. They don't ask for the project 100% sure and it's really not an ambition game, but it's a perspective game. Women need to reframe their own unconscious bias to say that I can do it. I'm a strong person. I don't have to shy away or feel bad. And I read this very often for myself, you know, and if I can do things and I don't have to sit late, it's okay. And a couple of things, you know, and we were really looking at it from the fact of what you talked, you know, the perspective, what are those limitations? I would like to really, really call that out that things are changing in this COVID situation, and we, women should take advantage of that also, and not feel anything about it from a negative way, because there are no football clubs now. Everybody works home from home. It's virtual, so make the most of it, because now it's an equal playground. Network the way everyone networks.  I probably missed a point, a while talking to you, and it just came, and I talked about networking. Today there are so many forums Rouba, that go beyond diversity. The star in me, there are so many organizations who are out there to support you, help you create that, like work for you. I think we should use it. We should really use it.   Rouba: (18:13) There's kind of a perception that women have a tendency to not push themselves forward as ambitiously as say, you know, their male counterparts and you know, what would you say? Is this a cultural thing? Is it a historical, progression that just remained with us as women in general? And you said you questioned yourself and whether you were capable of doing certain things that limit your, your, your thrusts forward.   Deepika: (18:42) Yeah, it does. Because every time, if you are going to judge yourself, if you're going to judge yourself, trust me, they're going to be many people outside there judging. What you have to do is you don't have to judge yourself. You have to have faith. See, you've got to be aware whether you're a woman leader or male leader being aware is so important. So, you'll have to know your strengths and your development areas. If you know your strengths, you can push yourself any way through. Culturally, yes, it is because everywhere, I think it'll change with the generations coming, Rouba, the culture part, but we still try to make it more comfortable. No, you know, it's okay. And I’ll share one example with you. When I was trying to grow in the last 10 years, there were a lot of my male colleagues who said, come on, you have a great life. Your husband's working great. You are earning so well; your children are doing so well. Everything else is going great. Does not mean that I can't grow. I mean, that's not a compensation you're giving me for what I am driving myself, and I always say, besides loving my family, the other thing I do great. As I work very well and I'm okay with that. So, I think there is a big piece cultural, and the second piece is our own self-doubts, which I spoke about the fact that I feel I have to be perfect. No, you don't have to be perfect. It took me lots of years to realize that that if I'm 80% there, the balance 20%, I can learn that. I have to have the confidence and I'm going to work strive towards it.   Closing: (20:22) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Andy Kettlewell: https://www.linkedin.com/in/andykettlewell/"Reimagining Supply Chains to Navigate a Pandemic and Beyond" with the Chicago Council of Global Affairs: https://youtu.be/zAGPc9vlaxUAndy Kettlewell video for Satya Nadella, CEO, Microsoft, Inventory Management: https://youtu.be/vkSNW6CJN7Q?t=570FULL EPISODE TRANSCRIPTMitch: (00:05) Welcome to episode 90 of Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong, and I'm here to introduce you to our featured guest speaker for today's conversation, Andy Kettlewell. Andy is the Vice President of Inventory and Analytics for Walgreens after serving many years prior in various supply chain and inventory management roles with the company. He spoke to my cohost, Adam, about all the disruption across business and how he has managed to handle the volatility in the marketplace. Andy addresses the impact of supply and demand budgeting for these unexpected factors and how technology has enabled him to make better business decisions. Keep listening as we head over to their conversation now.   Adam: (00:54) Andy, COVID-19 has been disruptive across all aspects of business. How have you handled the demand volatility in the marketplace, and then in turn its impact on operations?  Andy: (01:08) It's a very important question for where we are in a post COVID-19 economy. So we've seen dramatic changes in not only the magnitude of demand changes and demand volatility, but also the frequency and the pace of those changes. And, and to make that real and what we've all experienced in our lives, it's everything from, you know, the run on toilet paper, and you've probably experienced those shortages firsthand and how the news media kind of helped to extrapolate and share that story widely, thus creating a run in a panic situation to other commodity items like hand sanitizer and masks and other items that were needed for a shift in consumer behavior, right? With, with COVID-19 that the marketplace has had to respond to, but what we're also seeing is a shift, in everyday items. So with the traffic patterns and how, how's it impacted all of our lives. So likely you're not going to your office right now. So that means you're not passing the convenient Duane Reade in Manhattan, or your Walgreens, you know across from your office in downtown Chicago and that's changed our consumer behavior away from maybe those instant consumption items to more of those take-home items, right? That as we shift our behavior. There's been a couple of other interesting transformations here across all aspects of the business. So Satya Nadella, the CEO of Microsoft, in their last earnings call, likened  the digital transformation of two years of digital transformation that happened in two months. McKinsey and Company's research has shown that we've seen 10 years worth of growth in eCommerce penetration in only three months. And so we're, eCommerce penetration is now North of 30% across all of retail. These are dramatic shifts in consumer behavior that, you know, our organization at Walgreens and every retailer is having to accommodate to. So in the reaction and the operationalization of that, right first and foremost, every firm is having to keep their team members safe and so when within a global supply chain, right, that means, you know, new protocols, new efficiency measures, but everything from how we keep our distribution center team members safe, to our truck drivers, to our store team members to keep operations moving was, was point number one. And that means everything from personal protective equipment to new policies, procedures, different shifts in labor management, to help keep our employees safe, to then keep the product moving. And then from there, very tactical impacts within our supply chain that we've had to address including, we've redesigned all of our demand, forecasting and replenishment algorithms. Now what that means is right, all those consumer behaviors, the systems that go behind that, that use artificial intelligence and machine learning to identify what you're going to buy in Walgreens tomorrow, have to be much more dynamic. I liken this to a, for most firms like a sand mandala, if you're familiar with that term.The Tibetan Buddhist monks, you know, spend hours and days, you know, building the perfect sand mandala and then they have to wipe it away and then start fresh. That's exactly what most firms are doing with their forecast models across their entire end to end supply chain to become more adaptive and responsive to consumer demand. And then sourcing, right. you know, at the heart of COVID-19, we found areas within the end end supply chain that were very efficient, but didn't have many redundant sources. And what I mean by that, right. is that, I think about that toilet paper example, right? A very efficient supply chain, the factories run 24 by seven to spit out the exact right amount of product that matches demand usage for commercial toilet paper and consumer toilet paper. With everybody not going to their offices or to sports stadiums anymore, the demand for consumer product goes up, that's manufactured on different machines and, and requires, you know, sourcing new partners and, and the capabilities to build that new product. And then lastly, I kind of on the business of response to the demand volatility is around longterm planning, right? A lot of what we do to figure out what consumers will buy  and needis really sociology at the end of the day. Right. and we have to predict how consumers are going to behave in the future, and so that means longterm planning, right? In March, we were trying to figure out gosh are public pools going to be open. And are we going to sell many swim toys at Walgreens to our consumers, to trying to predict whether or not trick or treat is going to happen right now, coming up with, Halloween season. You know, Walgreens is the number two Candide retailer in the United States and whether or not trick or treat happens is a very big deal that has massive balance sheet and cash flow impacts if, those sales don't happen as they normally would, that we have to work through in plan, and to do that, you know, we're trying to tap into new and novel data sources to, you know, try to predict what the next big thing is going to be for consumers or how our consumers behavior will change, versus, you know, the past precedence that's been is that over the number of years.   Adam: (06:20) So you've talked a lot about how you know, consumers are effective in your operations, and one of the examples you mentioned was like the toilet paper, the great toilet paper shortage that happened when the pandemic started, you know. Can we talk a little bit more about the volatility of the supply impact, especially on the balance sheet, because, you know, you need that supply to be able to sell the products to the consumers.   Andy: (06:40) Yeah, absolutely. I would, I would suggest that what we've seen through COVID-19 is the most volatile and widespread supply disruption that most supply chains have seen in the last several decades. And the difference here is, is most supply chains are built to withstand normal levels of volatility, and this is everything from gosh, the semi had a flat tire, right, and arrived a day or two late to, you know, if we're doing manufacturing, operations in areas that are prone to getting hurricanes in the Caribbean or in Florida or in Texas, you know, we're, we're, we're prepared to have redundancy in manufacturing or planning to be able to shift assets around in the supply chain to accommodate those very short term disruptive events. And what's different about COVID-19 versus many of those short term disruptive events like hurricanes typhoons, earthquakes, even the volcano explosions that that happened to release ash into the atmosphere is that they're usually very localized and they're very limited in duration of immediate impact. Sometimes longer term impact when destruction happens with this pandemic impacting the entire globe, it's been very different and it's across our manufacturers, you know, they've really had to adapt and to, to manage through the, this impact, and so it's everything from reduced manufacturing throughput because of absenteeism, because there's a greater part of the population that's sick or has to quarantine, and how do you deal with that? To having to realize that I have lower throughputs, so how do I prioritize my manufacturing? And you see this on store shelves today with, tyou might not have every scent or flavor of a product..  You can have any flavor of Clorox wipe that you want right now, as long as it's lemon scented, because to increase manufacturing throughput, we rationalized down the skews that can be produced. But also we're seeing, you know, natural logistical challenges, it takes human beings to, to move product through boats, airplanes, trucks, and, and that does create constraints within logistical networks. But also on the financial side, right? All of these constraints that COVID has cause greater investments in operational spending, right? It costs more money to provide your employees personal protective equipment. It costs more money to run overtime in your factories, right? Because you might have be able to have fewer folks, you know, shoulder to shoulder factories safely. and with that increased operational spending, right, it's pushing, putting some compression on margins, across many firms. and for, for many suppliers that are, that are smaller in nature, it does provide some liquidity challenges that they're going to have to navigate through from, from a capital investment standpoint. The other bit that's impacting supply that I don't want to be dismissive of is external factors, especially governmental factors, right? So we saw at  the heart of the pandemic, the government's shutting down nonessential workplaces, and that does impact parts of the supply chain that, at points manufacturer components that go into other products, right, or what are deemed non essential supplies during that period. There were, for example, in our business cosmetic suppliers who had to shut down manufacturing for several weeks deemed non-essential, and that puts another strain on the overall economy, but also, puts some shortages on, on some raw materials as it relates to, you know, pharmaceutical ingredients globally. Additionally, I saw a bit more nationalization and governmental protections policies that happened. you know, so for example, China, and, a number of other Southeast Asian countries look to protect their own workforce and their own citizens first, and put some restrictions on exports of personal protective equipment or pharmaceutical ingredients at the height of the pandemic, to take care of their citizens and their economy ahead of the export channels. And so this, this global connectivity, around the entire supply chain flowing through with these external dynamic factors, are really, making it a challenge on supply across many, many commodities and markets to, to keep up with and putting strains on, and requiring new investments. And, you know, lastly in my role, right, in, in helping to lead inventory management for a very large retailer, right, that means we have to make different investments in inventory and stock holdings because of that dynamic nature, which if done thoughtfully, might not have an impact on the balance sheet, but, but in the short term, well, right, you know, we've provided guidance that there will be an inventory increase as we increase our stock holdings to maintain continuity of supply for our customers and our patients, so that we can ensure we have that supply, knowing that there's more volatility happening in supply base right now, and being realistic that in some cases we're going to have to spend a little bit more money to be able to accelerate how we get those goods to market. Might be more air freight versus, you know, ocean carrier shipments, which is at a significant premium to make sure that we can drive that product availability. So it's going to affect both that, that operational costs that OPEX spend as well as the, the inventory on the balance sheet as we migrate through this. But as the market settles down, right, as the new ways of working, continue to cement themselves into the supply base, and as those longer term capital investments in the factories and the machinery come on to bring more capacity, you'll see a waning in this come through. But it could take several years when you think about building more capacity into certain parts of the global supply chain.   Adam: (12:46) Definitely. So we've mentioned, you mentioned a lot of different factors, and I can only think about the accounting and finance team is probably having a crazy field day, just trying to work on a budget and trying to take all these factors into account. How have you worked with that team to kind of create a budget to take into account all these different things?   Andy: (13:03) Yeah, I would say the importance of the forecast versus the budget, you know, is becomes very important in this and our partnership with our internal finance and accounting teams is critical to make sure that we're putting the jet fuel into the company, right? When you think about a retailer, I can only sell the inventory I have, right? And so we have to make very thoughtful inventory investments that meet that dynamic consumer demand that we had talked about, and so we need to not only free up the working capital of the, the less productive inventory, or the, the items that our consumers aren't buying, so that we can invest into the, the items that we expect our consumers to really need. And so we've actually moved to a more granular budgeting and forecasting process as a result, right? To capture those nuances of where we think we're going to have to make spot investments, and that's really helped us to help tell the story, you know, as I meet with our CFO and all of our finance partners for the division to help folks understand where the thoughtful investments are, how long we expect to sustain those investments and the drivers that are those risk factors that I mentioned in the supply base, or the demand volatility are causing us to make those investments. And so, you know, we're, we're more frequently forecasting our inventory and receipt flows as well as our demands. So moving from monthly processes to weekly. Moving from high level categories. So example of paper goods versus toilet paper, and, you know, facial tissue and paper towels, and really breaking that down to a very finite, granular levels, and even regionally has been critical for us so that we can track where we're waiting on those investments and those bets that we're making with inventory and where we're losing as well, and we to take quicker action to, exit out of some of those businesses and reinvest into where we expect the demand to go so that the inventory investments don't just kind of run out of control on us. And so it's been a very good partnership with, with our finance partners, but it's required us to revisit those processes. It's also required our finance and accounting team members to get closer to the business drivers. And I would say that that's the advice that I would put out to all of our, you know, management, accounting and finance professionals out there is really embed yourself with your business partners to learn about the risk factors, right? Those external factors that are impacting the business decisions like I talked about in supply and demand volatility is going to help you understand, you know, those, those forecasting biases or the, the range of accuracy that, you know, we may or may not have in such a dynamic environment and your business partners would have, and this kind of environment.   Adam: (15:51) So to kind of round out our conversation, you know, you've mentioned a couple of times the different technologies you use, and I'm sure that AI and RPA have come into play, to help make better, better decisions in your supply chain. So how has the digitalization of the supply chain helps you as a retailer, but also flown down to your consumers as well?   Andy: (16:11) Yeah, it's we couldn't have responded to COVID-19 without the digitalization of our supply chain. It's critical. What we do at Walgreens is, the, the non-pharmaceutical, so the non-prescription side of the business is we have to forecast and replenish 200 million items store combinations every day, and try to predict that demand there. And, and we do that as a central function and to, to be able to process through that much data and it ingests, what are the data around what our consumers are telling us they need and want and don't need, and don't want at any given time it's critical. You know, we've invested heavily in tools like RPA to automate more of the repetitive tasks to operate the machine. I like in the supply chain machine that most firms are using, like one of those great Rube Goldberg devices, right? We've got the bird that you're not over the glass and moves the marble down. You know, we can automate a lot of those tasks so that we can free up our human capital into tuning that machine and making it as agile and responsive as possible. And the RPA has been a great investment there, but when where see a lot of growth is in the machine learning and the artificial intelligence space, right. You know, gone are the days where you might increase a forecast for a category by 30% and let it aggregate to every store or for every item in that category. Our consumers don't shop that way. You know, we don't supply that way. And so we need to ensure that we're micro tuning every note in the supply chain to be as responsible as possible. So if we see a trend that, you know, a certain category say, hand sanitizer is spiking in a college town, right? Because that, that college town went back to school, and then two weeks later that the, you know, the campus, you decided to go to full e-learning. We need to be able to capture that in real time, and from disparate external data sources, news feeds social media to be able to influence those micro forecasts that thus drive all of the orders and all of that inventory flow and the millions and billions of dollars of inventory that's flowing through these supply chains. So that that's responsive to how quickly the market can move, especially during a pandemic, but also through the growth in the digital and the e-commerce economy, because we see a lot of shifting happening there so that we can, utilize that customer data to put the best offer in front of our customer. And sure we have the availability and can meet those needs as they change. Adam:Well, Andy, I really appreciate you sharing your insight and expertise with us on the podcast. I know that our audience is going to really enjoy this conversation.  Andy:Thanks, Adam. And thanks for the time today. Really appreciate you sharing our story and, you know, helping to share about how supply chain impacts, you know, everything through the management, accounting, finance space, because we're at the end of the day, we're all one team, growing our business and our firms value and how we deliver that. So happy to share that story.   Closing: (19:18) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Mai Luu: https://www.linkedin.com/in/mai-luu-693596168/"Small Business Planning During COVID-19": https://www.imanet.org/insights-and-trends/risk-management/small-business-planning-during-covid19FULL EPISODE TRANSCRIPTMitch: (00:05) Thanks for coming back for another episode of Count Me In this is your host Mitch Roshong, and I'm here to bring you episode 89 of our series. We all know small to medium sized enterprises are a huge part of our management accounting profession, and COVID-19 has greatly affected the way these businesses are run along with the economy as a whole. In this episode, my cohost Adam talks with Mai Luu. Chief Operating Officer at Commonwealth Capital, LLC. She has also funded businesses and is very familiar with the small to medium sized business landscape. While talking with Adam, Mai discusses  various cashflow activities, venture capital funding, and other ways these businesses can obtain funding to renew themselves while still staying true to their original business purpose. Keep listening as we head over to their conversation now. Adam: (00:58) Small- medium sized enterprises have been affected greatly by COVID-19. How can businesses find a way to renew themselves and become new all over again? Mai: (01:09) COVID-19 has a far reaching economic impact in so many areas. Most every industry in every state has experienced the impact of COVID-19.  Second quarter GDP job, 9.5%. To put it in perspective, since record keeping began in 1947, quarterly job has never been more than 3%. With so much spending, making up two thirds of the US economy declines 12% percent between April and June, 2020. National debt and monetary policy for coronavirus stimulus packages are added to the national debt. With the Fed loaning money and buying financial assets,  1.41 million daily, the money supply, and two has recent sharply despite the injection of money into the system. Inflation stays close to zero, which could be a signal of a looming deflation in a near future. Disrupted supply chains and shortage of products, especially PPE products. Employment has been heavily affected. Job losses were worse than in the Great d\Depression, 50 million people out of a job. As many businesses closed, permanently and restrictions continue in several parts of the country. How business reinvent themselves in the wake of COVID-19 requires serious reevaluation of their business models, product and service offerings and financing methods to adapt and thrive in the new normal. Some of the old way of doing business are no longer effective and some products and services are no longer relevant. So understanding the renewed needs for both customers and service providers should play the central role in researching for the new business models, strategies, and product and services. While the pandemic reveals business weaknesses, it also presents opportunities for resetting strategy and business residents. With working from home businesses, adapt and embrace flexibility. So work life balance becomes work life integration, automation, core self-service portals, virtual help desk, and the use of productivity tools increase efficiency and adaptation. So this set of changes in our lifestyle transform how we consume products and services and how business operates. One thing that I can think of is cashflow and liquidity. This is one of the most important areas of business continuity. I can think of a few basic principles in managing cash that include one, reduce cost as much as possible and seek alternative financing, including the use of government support policies and working with landlord vendors and suppliers for favorable payment terms. Two, focus on generating cash, also turning a profit. Three, be transparent and fair to employees and share resources in case you end up having to cut staff. Adam: (04:48) I think you gave some great advice as people are looking to start new, and one thing I didn't hear you mentioned was something like venture capital. what are some of the considerations that SMEs should look at when seeking venture capital funding if they are trying to use that as starting new Mai: (05:05) A traditional venture capital VC business model is built based on hitting a few home runs to make up for many losing backs. Due to the high-risk nature of startup and early stage companies, VCs are extremely selective, only 0.1% of new ventures receive venture capital in any stage that leaps 99 point 99% of startups not receiving VC funding.  Ofthose that seek VC funding only 1.5% receives it. Even at this level of selectiveness, the majority of VC investments have  attractive returns. VCs prefer to fund high potential disruptive ventures in emerging industries that can offer high returns in a short period of with attractive exit options, acquisition or IPO. So those firms are known as unicorns. Businesses that can benefit from venture capital are disrupted capital intensive high growth ventures in emerging industries, host competitors are also getting venture capital funding. So when you're working with VCs, you need research to find the right VC fund. Some VC funds have restrictions that affect the investment choices. Some VC funds are geographical based or industry based or impact investing, etcetera. With that in mind when seeking venture capital you should first five venture capital funds that invest in companies like yours. Two,ensure that the VC firms invest in the stage of funding, that you are seeking. TThree, check out the VC firms past deals, and four consider location of the VC firm. I can think of as a few other considerations when seeking venture capital. One VC may seek control at the startup by taking a large portion of the equity, selling out common equity in the early stages of the company's existence, generally result in selling out the company's most precious element, which is the common equity ownership. This is a critical mistake made by a lot of entrepreneurs. Two VCs. also set the tone of the deal to make sure that they get multiples of the investment before anyone else, so entrepreneurs usually come last.. Thirdly, VC might replace startup to-dos with higher manager that could lead to the loss of the entrepreneurs, original vision and passion. Lastly, with your VC investors, sitting on the board and closely overseeing the company strategy and operations, your dream might become another job. Adam: (08:10) So in a lot of ways, venture capital is a really good investment, and if you're that unicorn that gets that, that gets that funding, it can be really important for you, but then these considerations that you just mentioned, it may not be, it may not always be the best option. Are there any alternatives? Mai: (08:26) Correct. Yes. Fortunately entrepreneurs can seek capital for their startup and early stage company without relying solely on the mercy of institutional money. So for the, for the entrepreneurs who understand the private capital markets, they can raise a substantial, substantial amount of capital through something called exempt securities offering without having to give up too much of their equity at the early stage for too little money. Keeping the vast majority of equity ownership and voting control that an entrepreneur can stay the course of their original vision and passion. The JOBS Act of 2012, brought the single most significant change to the securities law since 1933. The JOBS act lowers the barriers in the several area of the securities law permitting smart business to raise capital directly from the general public. So basically they are legally by passing VCs. With less restrictive registration requirements and expansion of the exemption from securities registration, normally cost prohibitive for most startups that makes a security offering to raise capital very attractive. So the most significant improvement the regulation was the lifting of the ban on general solicitation of privately placed security that allows startups to advertise their securities offering to a larger pool of potential investors. Under the JOBS act exempt securities offerings include regulation D rule 506B for private placement. Rule number 506C private placement that allow general solicitation specifically to accredited investors and limited offerings. Rule number 504 regulation A plus, and lastly regulation crowdfunding. In 2019, much more money is invested in exempt offerings than register offerings during which register offerings accounted for 1.2 trillion, which is 30.8% of new capital compared to approximately 2.7 trillion or 69.2% that was raised through exempt offerings. Adam: (11:15) So can we talk a little bit about what the current environment looks like for raising capital during COVID-19. Everybody's at their homes and their, there's so many things going on and there's so many other elements involved, but you still need to, run your business. Mai: (11:32) Yeah, sure. Yes, absolutely. Experts predict an economic recession that could last several months. From several months to two years. VC's are focused on the existing portfolio companies instead of adding new investments to their, portfolio, however deals are still getting done, but investors are cautious in making new deals and they are staying in the wait and see mode. The good news for founders is that investors are sitting on a record number of capital, 189 billion of dry powder, which is 50% more capital than it was available during the last economic downturn in 2008. Despite the pandemic though, what VCs and investors and target markets look for, hasn't changed. They want great intellectual property, a big market, strong value upside, and a product that has commercial promise and a leader or leadership team that is coachable or has a self awareness awareness of humility to step aside for a more experienced leader on the investor side investor. Also look for leaders that have experienced in building companies, can uplift and empower a team and have a deep network of key opinion leader advocates. Adam: (13:05) So it's really high risk to invest in a startup, you know, especially in this market, like you just mentioned, you know, how can SMEs help to keep their initial interests at heart, but also that of the capital investor, how do you balance both. Mai: (13:21) Through proper corporate engineering and deal structuring of an exam securities offering one can increase the success rate of raising capital while providing the investors with a good level of protection. So earlier I mentioned, corporate engineering. Corporate engineering is the process of developing, implementing, and maintaining all of the corporate governance policies, procedures, and protocols necessary to prepare and qualify a company and its securities for a public publicly traded listing on the US securities exchange. Secondly, attractive deal structure provide good returns and liquidity for investors. Liquidity in the private market has always been a problem. Hence, a deal structure that has a built in exit is very desirable. Also the use of hybrid convertible securities inherently enables one to raise the maximum amount of capital at the lowest possible cost of capital convertible preferred equity can be temporary equity that have little or no repercussion for investors, if engineered correctly. With respect to the return of principal and profit to investor, the philosophy behind creating a marketable deal structure is primarily based on the priority afforded to investor financials, interests that provide for the maximum amount of security of investment principle, combined with the maximum amount of return on investment. By doing so with hybrid securities, you also accomplish the goal of raising substantial amounts of capital without giving up too much at your company for too little too early. Closing: (15:20) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Karin Baggstrom: https://www.linkedin.com/in/karin-baggstr%C3%B6m-9233a72/STARZPLAY: https://arabia.starzplay.com/FULL EPISODE TRANSCRIPTAdam: (00:05) Hey everyone. Welcome back to Count Me In, I'm your host, Adam Larson, and I'm excited to bring you episode 88 of our series. Our expert guest for today's conversation is Karen Baggstrom. Karen is a Founder and CFO of Starz Play, the leading subscription video on demand service that streams to over 20 countries across Asia, middle East and North Africa. In this episode, my cohost Rouba talks with Karen about how the COVID-19 pandemic has actually accelerated her business. During their conversation. Karen uncovers, how stars play as harnessing the power of technology to optimize the finance function and leveraging data analytics to enhance future growth. Even despite the current challenges. Keep listening, how amid digital disruption, recessions, and pandemics finance and accounting professionals remain ahead of the curve.   Rouba: (00:58) So good morning, Karen, and thank you so much for joining us today.   Karen: (01:03) Good morning, Rouba. Thank you for having me.  Rouba: (01:05) I'm actually looking forward to hearing from you as Starz Play has been a really beautiful example of organic growth out of the middle East region. So kudos to you guys.   Karen: (01:15) Thank you. Thank you. Yeah, we're excited as well, even though the whole of COVID  epidemic is of course, nothing that we would like to have, or see of course.   Rouba: (01:28) So I want to dive right into it. has, I mean, as somebody who works in finance and accounting and you're the CFO of Starz Play, has the digital transformation of finance impacted the roles and responsibilities of today's CFO and what are the skills needed to maneuver during such trialing time, like you just mentioned now, in your opinion.   Karen: (01:51) Sure. I mean, I think in general, moving to digital environment has changed and impacted many roles in, in businesses around the world, not just finance also, of course, however, I do think that in finance, the CFO and the finance department has a little bit stepped out of just being the accounting and reporting team from, you know, looking at the actuals, just comparing things to budget. Moving into this digital environment has allowed this team to become more part of the business integral part of the business, I would say, because back in the old days, the finance department was only always the one that was just looking at, you know, this is what happened, we'll book it in the balance sheet and the P/L, and then we compare it to the budget and then you send off a report. But now I think there's so much more involvement between the finance team and all the other teams and going digital of course, is a big part of this, because when you move into the digital world, you all of a sudden needs two different systems. And I also think that the finance team has become more analytical in their way that they work. They, you need to be able to analyze what comes in and not just take, you know, the cost as they are, and just look at them and say, okay, that's it that you're challenging the rest of the business, that your, you know, questioning the other departments in the business and saying, yeah, but is that really so, or can we change anything or why is that so? So I think that the finance team has become much more analytical in the way that we work and going digital is a big part of that. I was gonna say, I mean, for us, at Starz Play, we are a hundred percent digital. I mean, we work in the digital space. Our product is in the digital space. Everything is digital. So for us, it's natural and we have a lot of data around us all the time, you know, all this subscriber data or anything that touches our service, we have data on it. So, you know, I think from our point of view, we haven't gone digital as such. We are always work that's in our DNA. It's how we started this business. But no, I for sure, I see that my team, if I compare, you know, when I started in, in finance way, way, way back when now it's way more analytic, and the finance team is challenging the rest of the business much more, and that is a big difference.   Rouba: (04:47) And you mentioned the breaking down of silos and the interconnectedness of it all with finance teams becoming more involved in other departments, and I'm sure that includes the likes of marketing and product development, what have you, and do you find that the lines between CFO and CIO for example, are also blurred and then what role does digital transformation play at Starz Play? I mean, it'd be curious to know how that's working since you mentioned it's a digital product by default and in your current business model, especially, you know, within the finance team spectrum.   Karen: (05:19) Yeah. I mean, for a lot of companies, I do think that you will see a blurred line between the CFO and the CIO, especially in companies where you cannot afford to have a big C-suite where it does not make sense. You might have a CEO and a CFO and that's it. So you cannot have, you know, add on more C level people. So I definitely think that, and it makes sense from a certain perspective to do that. For us at Starz Play, we haven't really that structure because we're such an, you know, digitalized company. We have, we have the CFO and the finance team and we manage everything that has to do with finance and analytics and so on, and then we have a very big tech team and development team. And under that tech and development team, we have, data analysts. We have a big data analyst team, that is also working on, AI. So that kind of sits for us in our company. It sits under the tech team, but I'm definitely sure that in other companies, the blending of the CFO and the CIO does make sense for sure. And then your second question on how, you know, the digital transformation, what, how has this impacted us at Starz Play and add the business model that we have? as I said earlier on we, because we're a company within the digital space, we haven't really transformed as such, you know, from something being brick and mortar to transform, but what is happening is that we are evolving all the time. So we are, you know, we, we see that we need new tools to analyze certain type of data. We see that we want to go more granular into things, into information that we have, be it, you know, just simple, we get a supplier invoice and we want to be able to challenge what is that, you know, that data that is on that invoice and we can go more and more granular. So I think we didn't go from brick and mortar to become digitalized, but we are digitalized, but we're becoming more and more sophisticated.  Rouba: (07:41) But I think it's such a model is yours was actually born as a result of the digital, disruption. You're a disruptor! So successful leaders around the world, pride themselves on being lifetime learners and the, and they say that this is the secret for ongoing success, you know, especially in this era where there's new ways of doing things every day, what is your view on the need for continuous upskilling and reskilling, and obviously wellbeing a lifetime learner, you know, and not just for you for also your team and how do you apply that as well?   Karen: (08:24) I mean, I can only agree with that statement that, you know, you need to continue to learn as long as you live. You can't just say one day, sit down and say, you know, I know everything. I think you need to be, you need to be very humble towards what you don't know and, and it doesn't, you know, it doesn't matter where you are in life or what position you have. There's always so much more to learn.  And the thing that I find fascinating is when you learn from the younger people, for example, in our company, we have, you know, the marketing team and the team that is running the social marketing. They're a group of very young people, and they know exactly which apps is the app of the week, or, you know, what are the trends right now going on and, you know, all the different apps and they mentioned apps and things, and I'm like, I have no idea what you're talking about, but I'm learning. And, you know, it's a good thing. So you also need to be able to, you know, just sit down and listen to the young people because they have a lot to learn you as well to teach you. But no, for sure. I mean, learning is important. And I think the thing that you also need to, you know, be comfortable with is that learning, isn't just sitting in the school bench and getting a grade, you know, doing a long course or so. It can just be as simple as, you know, reading articles, reading blogs, watching lectures on YouTube, or, you know, any type of means is learning, but you need to continue to challenge yourself and, you know. Hmm, I don't know that I need to explore that venue, and then you go and search information on it. I think, and then also when you, you know, you know, how do we work as a team? I mean, that's something that I encourage my team to do, you know, find information or find something. If you don't know anything, go out and look for it. If there is a course in something, then, you know, we'll figure that out. But very often, you know, you can just go out and find information yourself, and then when you get stuck, then we get help.   Rouba: (10:35) At least knowing your strengths and your weaknesses gets you, you know, halfway there. I know it's a very good at the view and especially keeping an open mind, I think, as you said, you can find that learning anywhere. It doesn't. So COVID-19 is, you know, the disruptor of the disruptors, the mega disruptor, and has disrupted so many different industries, but in some cases it's also accelerated them. So, I mean, we've looked at figures in the, in the middle East region and the Gulf specifically UAE, there were some companies that reported up to 800% growth during the pandemic and Starz Play was one of those that report that an increase in the number of paid subscribers. How significant was that growth and was your platform actually ready to handle such an increase in numbers of subscribers and transactions?   Karen: (11:27) Yeah, so, I mean, we were, one of the fortunate companies, during this, this pandemic time, that actually has benefited, to some extent, and we did see a very big growth, especially here in the MENA region during lockdown. So during Q2, when, at least for two months, we saw everyone was under lockdown. We saw a huge increase in the number of new subscribers, but also even what we actually pride ourselves more in, in the, in the consumption, how much people were actually watching. So that's a measuring tool that we use and how much content, how many minutes are our viewers actually watching on our service and to give you a benchmark on how much it actually increased. So we manage in this quarter, we managed to triple the consumption with what we've done over the last five years since we launched. So, I mean, we were super happy with that, and, and to your question, you know, how did the system hold up? Because that was what, you know, our concern as well, because all of a sudden you see this massive spike in people coming into your service and wanting to view content at the same time. So everyone is pressing play and wants to stream at the same time. And the platform scaled perfectly. We didn't have any, we didn't have any outages or any issues. we, the way that we've built the whole technical platform that we have, which we've built, mostly in house, is that we can scale it very quickly. So the more subscribers we have, we can expand it, and then if the subscriber base  decreases slightly, we can decrease it A bit. And then, so we can expand and go back and forth depending on, and we see the seasonality, on a weekly basis. So, you know, consumption goes up Thursday, Friday, and Saturday, and then it goes down again, because then it's weekdays, people are working. We see seasonality also that COVID period is, is exceptional, but normally, but normally areas we would see, you know, we have a higher consumption, when we  release certain box sets. So for example, when we launched Vikings, the new episodes for that season, we see a big spike in consumption, and then that drops down again, and then we launched another new series. It goes up again. So we're very happy with how, the technical platform scale during this period.  Rouba: (14:10) Brilliant and looking at other businesses, because they're are obviously other, businesses in the region that are experiencing similar, exponential growth, and particularly those who are able to in time, convert their business from, or migrate their business from brick and mortar to e-commerce, which is a very difficult task obviously to do overnight. But do you think that they have the right financial reporting systems and data analytics that would enable them to kind of deal with this increased flow of revenue? And then what advice would you have to give when it comes to having that pillar of digital elements on the financial spectrum of their business?   Karen: (14:50) I definitely think that some businesses, for sure, struggled with the scaling up or ramping up their eCommerce or their, their online presence, I should say, the companies that didn't really have an online presence before COVID-19, they would probably have struggled a bit more, but the, the ones that did have a presence, you know, they had an online store or any type of online service. as long as their systems could scale, they would have been fine. Of course, now reporting wise, that's always the tricky one, because if you're not prepared for the volumes, then the reporting can always be, you know, lagging or you actually don't capture everything, and did you bill all the customers that bought the product, which is, of course, as a CFO, the one that you're nervous about, did we actually build the customer? You don't want that to be the problem. And I do think that potentially some businesses did struggle a bit. I hope not too many. I hope most people, you know, had their, their fundamentals done. And the thing is that even if you, as long as the billing is done, as long as you did charge a customer and the customer got their product or their service, whatever they bought, you can always, after the fact, figure out the reporting, even though it's a big job to go back and try and reconcile and do all that, we know how reconciling is in finance, but you can always do that. But I do think that, you know, now the learning for a lot of businesses, or like, what's actually say most businesses that has some type of online presence is that you need to have these fundamentals in place, because by now people are so used to buying everything online. We did that before COVID as well, but more so now and much more so now, and even things that you might previously not have thought about as hardware, for example, like a hardware store, you would go to the hardware store and, you know, buy or garden things and so on, but now they also need to deliver, or you need to be able to go there and pick up, and there needs to be a proper online store. So I mean, the, my, the learning from this and the advices is of course, that if we've come to this place now in time, you just need to get all the fundamentals price. You need to make sure that you have a proper billing system in place. You, you need to know that your system can scale. It doesn't need to scale maybe to COVID measurements, but it needs to be able to manage increasing volumes. You don't need to build things in house. There are perfect third party services that you can, that you can get, but you want to make sure that, you know, the, the flow of the reporting, the flow of the payments and the flow of if you're shipping actual products that is actually working and that you've tested, and that you've stress tested yourself before you put it out to market.   Rouba: (17:58) And especially when, you know, things like how data set, this kind of data informs your, you know, your future strategy and how you're adjusting to meet the demand. So, yes, I agree. It's vital, whatever it is, put it in place.   Karen: (18:12) Yeah, no, I definitely, for sure. And the thing is also, as you mentioned, mentioned with data, I mean, the data is produced very quickly, but you also need to know how to read the data or to manage the data and analyze the data. So just having a lot of data on a server, it doesn't help your business and the hands and other skill is born. So you need to be able to decipher what that data is telling you. And that's a new skillset for a lot of businesses.   Rouba: (18:44) Hence that the constant need of, you know, being the lifetime learner comes into play. It's a nonstop process. Yeah. But I, you know, I must say we're fortunate in a way to be in this era because there's so much, material that we have access to that enables us to, you know, perform better that imagine like 20 years ago, how, how slow the process is where compared to now, so amid all of this beautiful disruption, which I find really fascinating, recessions, pandemics and all of that, how can finance and accounting professionals remain ahead of the curve and continue to add value to their organization?   Karen: (19:22) I think, you know, the finance team can add value by being proactive in what they provide to the business. So they need to, as I said earlier, the finance team has become so much more analytical than what it was, years ago. and the way that we put together data and the way that we present it to the business, and the way that we then can, you know, steer the business in a direction, which is positive, which is based on, of course it's, it's based on historical numbers. So we're not projecting as such, but we can at least say, you know, these are the trends, this is what we're seeing in the data that we're collecting, and this is how the finance team stays ahead, and, you know, continues to deliver. I just think that the world has become we're so data driven today. So pretty much any team that you have within the company needs to analyze data, correct. In one way or the other, it's not just the finance team. It's the marketing team needs to analyze data in their way the product team needs to analyze. So we're so data driven, and I think that for any business to stay ahead, you need to be able to understand, read the data.   Rouba: (21:00) Can't agree more, Karen, this has been really insightful. Thank you so much for your time. Really appreciate it. And, look forward to connecting with you again really soon. Karen: (19:22)All right. Brilliant. Thank you so much.   Closing: (21:16) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Jason Pierce: https://www.linkedin.com/in/jasonrpierce/ About Jason Pierce: https://edelsteincpa.com/our-team/jason-r-pierce/ Forensic Accounting Video, "Does my balance sheet balance?": https://edelsteincpa.com/does-my-balance-sheet-balance/FULL EPISODE TRANSCRIPTAdam: (00:00) Welcome back to episode 87 of Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host Adam Larson, and I'm excited to introduce you to our featured guest, Jason Pierce. Jason is a partner with the firm Edelstein and Company in Boston, Massachusetts, where he specializes in financial forensics and business valuations. In this episode, he talks with my co-host Mitch, about how a background in audit lends itself nicely to forensic accounting and business valuations. He also explains how the emergence of data and data analytics has played a major role in his job today. To hear more about fraud forensics and financial valuations, keep listening for upcoming conversation. Mitch: (00:45) So, Jason, I know you have a very interesting background and I'd like to start this conversation with you just kind of explaining how you started off in your accounting career. Jason: (01:01) Yeah, thanks Mitchell. So I'm a military brat, which means we bounced around the country, from place to place, which I also think kind of helps with fill in with this, forensic accounting stuff which we'll talk about in a little bit just from looking at things as an outsider, but where we landed when I graduated from high school and college was an in Tennessee. And so after I graduated, I was looking at, at the time, going through another year of school due to the 150 hours necessary to get my CPA. But meanwhile, my dad had shipped off to Alaska and I would go visit in the summers and see how awesome the summers were up there. And it just kind of drew me up to that place. Those of you who have been there, know exactly what I'm talking about. So after, after graduation, then I moved up to Alaska, started working at a small CPA firm up there, and I did specialize in auditing for about 10 years before I jumped into this forensic accounting and business valuation area. Mitch: (02:10) So how exactly does auditing turn into forensic accounting and your business valuation? Jason: (02:16) Yeah, for me, it was, it was overtime, you know, so if somebody would have asked me in college, like what would I be doing today? You know, forensic, accounting side of things. I wouldn't even have known what that was. So, so just for the listeners, let's defined forensic accounting. The easy definition of that is really the art and science of investigating people and money. Or I think a lot of the misconception is, is just kind of chasing the money. But once you figure out the people's side, then the money side becomes easier to figure out. So there is a relationship between the two. But so how it happened for me was, as I said, being a staff auditor in Alaska meant a lot of trips out to the rural communities, which we call the Bush, right, where there's no road system and, but I'd be out there and every now and then there would be a situation where the records are gone, the former managers are gone or that the city administrator, what have you and so those audit then turned into a forensic investigation. And, sometimes that meant just kind of figuring out what the heck happened. And it also, sometimes it meant like people made off with some money. And so we had to just kind of figure out, what we call like pick and shovel sort of methodology is understanding what happened and when, and how that translates to the financial statements at the end of the day. Mitch: (03:48) So, with that in mind, you know, can you kind of tell us what it means to have a forensic mindset and how you were able to kind of apply some of, you know, your auditing and accounting background into what you were doing with forensics? Jason: (04:00) Yeah. You know, it's interesting with the, with the forensic mindset compared to what one would traditionally think of as an auditor, that in an audit you're looking for matching. So like uniformity, consistency, you know, does, does the check or purchase order or invoice agree from the date, the payee or the vendor, the amount and the expense or whatever account code do all those match with what's going through the general ledger. And so on the surface, you have this forensic or the audit mindset where you're digging through the general ledger, making sure that the financial statements agree in all material respects and all that good stuff, but what the difference is from a forensic side of things is you're looking for differences. In other words, whereas on one hand, we're looking for that uniformity where on a forensic side, we're looking for, let's say there's a $2,000 dual signing  check limit where in other words, if there's two check issued for more than say $2,000, it requires dual check signers, but lo and behold, there's a lot of checks for $1900. In other words, if we're looking at things where we have the ability to look to see if is there round numbers, is there what we call like, there's a technique called Benford's law, where you could look to see from the placement of the digits in whatever sort of metric you're looking at, there should be some uniformity to it. And without getting into that there's ways where you can test from a risk based approach to identify like the nice round numbers, or there's a lot of checks that start with say threes and that's disproportionate to what would be expected. So there's ways to look things from a forensic perspective, that are different from say a traditional audit mindset where you're just grabbing 40 to 60 cash disbursements and kind of checking those against the general ledger. Mitch: (06:16) So now you have these two different mindsets and you've got experience with both, but today I know you do a lot of work on business valuation. So how do auditing and forensic accounting mesh and ultimately allow you to come up with these business valuations. Jason: (06:34) Yea well, surprisingly or not surprisingly, there's a lot of accountants that are in this field. And I think primarily is because we know how things flow through the general ledger. We're also detail oriented folks, and I think that's a key element. I'll come back to that. We know where to go on the tax returns for, to find information, or what's missing from a tax return oftentimes. And really it's back to that, getting the story behind the numbers, right? We want to be able to take a situation where we're analyzing a business and see where it's been, but where the business valuation kicks in. It's really, what is the, what's the worth going forward? So we're where it's been, it's important to understand the risk and, you know, we could do some diagnostics from the financial statement analysis aspect, but the business valuation side of things, it's really like the present value of what the business is going to do. And so when we look to see, and that's where the forensic kind of overlays and with this, the valuation analysis is because we are looking at, sometimes individual transactions, but sometimes it is just uniformity from year to year. And let's say like the marketing expense was, let's call it 1% of revenue for the first four years, and then in the last two years, it's been three to 5%. So we kind of wonder what's what's in that is, is that really just an investment in the business that we could use to justify why we're going to grow revenues? Or is it because there's, there's a brand new luxury vehicle that's getting run through the, the general ledger or some, some trips to Vegas pre COVID, what have you that don't need to be in there? And so from, from a valuation side, we would adjust for those, those sort of transactions. But yeah, from a transition, from an accounting based perspective to forensic based analysis and business valuation, call it forecasting, there is a lot of overlap, but where I think I would caution listeners, is to have a solid understanding of finance rather than just kind of assume that we can do a present value formula in an Excel and think that we can just kind of run some of this stuff, because the way that I know that I'm improving is to look to see how my previous valuation reports look. And I can tell you with certainty because it's been long enough from statute of limitations that these things don't matter anymore. But my first business valuations were just that, where I thought I knew what I was doing, but when you look at them today, it's like, wow, there was, there's, there's a lot more nuance. Mitch: (09:25) So you talked about diagnostics, you talked a little bit about analysis, you know, my next question deals with those detailed analyses, some of the nuance that you were talking about, and how do you go about identifying some of that, you know, particularly in your perspective, I'd like you to share, what role does data analytics play in your business valuation today? And does it tie into forensic accounting even in taking a step back further? Jason: (09:49) Oh, you bet. So let's, let's take a situation where most of the, the activities that we look at, you know, whether we're dumping things out of the general ledger into Excel, or we just are doing our own calculations in Excel, most things can be done in that or, I don't want to just limit it to Excel, but, you know, spreadsheet type activity, but what happens if you have millions of transactions, you know, or you're looking for something specific where you have two different databases, where in those situations we rely on that, those data analytics, software. Think like IDEA or ACL, if that's a familiar term for folks. Where, as an example, we had a food delivery business case, with, with 12 million transactions, we had to do some analytics on that. It just wasn't real convenient in Excel. So we put that information into the data analytics software, where you could look to see, like what about entries on weekends? You know, I talked about the Benford's law. That's, that's certainly part of that analysis. You can, you can look to see is, you know, compared the vendor database to the employee database and see if there's some commonalities between either phone numbers or addresses, you know, things like that, that you just can't do with the day to day sort of spreadsheet analysis. So, the data analytics is a big piece of this, as I was saying, like the important characteristics of a forensic accountant, is that data analytics side of things. But there is, for those of you who are interested in it, there is a course offered by the IMA that, you could get 21 hours of CPE and it's literally called Data Analytics and Visualization it's put on by the University of Illinois and it gets, gets into some Excel stuff, but it also gets into Tableau, and some other areas of that, your average say CFO or controller might not be familiar with either because of their job duties or, you know, just without having the need to, perform those types of activities. But yeah, that's a great course. I'm halfway through it right now. Mitch: (12:08) So with these analytics and, you know, the different mindsets that you put in place on the day to day with the different clients or companies you're working with, what are some of the warning signs of fraudulent numbers? Like what are some of the things that really stick out to you and make it obvious that you need to dig into these numbers a little bit more? Jason: (12:25) Yeah, well, you know, what's most common on my side cause I mean, I'm not in industry right now. I'm working at a CPA firm, is where people will come to me and say, you know, Jason, I don't know what's wrong. I'm bouncing a lot of checks. Meanwhile, I think I'm making money. So like, that's very common other activities where this comes into play. It's, the mindset that having the ability to trust people, but verify. And if you think of that, I don't want to keep going back or go to the fraud triangle, but it is appropriate. So for those of you who don't know, that's where the opportunity, the pressure and rationalization meet to where a fraudster will then, you're more likely than not to have some, some fraud occur in your organization. So we can't do anything about the pressure or the rationalization cause that's to the individual, but we can do a lot for the opportunity and minimize that. And if even if people think that you're watching, then they're less likely to do so. And if you haven't seen it, there is an article in the Strategic Finance publication by the IMA last month called Fighting Fraud in the Workplace. It gets into some of the areas that one can do to strengthen up the internal controls or analysis of transactions or surprise audits. You know, those types of things that, while we trust our employees and we want to make sure that they learn and grow, we also want to let them know that somebody is watching. Mitch: (14:01) I think a good way to really wrap it up for this conversation is, you know, do you have any, notable cases or anything that really highlights something that was most interesting to you through your career? Whether it was, you know, early on with the audits or the forensic trails, you know, what is it about this that's so interesting and anything specific you can share with our listeners, that maybe they can apply or pursue? Jason: (14:25) You know, if we think about what are the ways that without talking just litigation is, is a situation that I've come across regularly, which is more the use of multiple entities to basically have a workaround from the general ledger. We see that with the Enron, companies with the SPE's, right? So one of the things I see is say where you have a business owner that has a related entity, whether it's the real estate or just, you know, like a subcontractor kind of management type entity, where they have the ability to kind of shuffle costs, or fees around, and if we don't have the ability to look to see what's on the other side of that, then we're at a disadvantage. So I would say to be cautious as I'm putting myself as is a user of one of us as a listener of this podcast, like a CFO controller type person that we would want to have the, say the data analytics capability, where we could do that merging of databases. You know, it's easy to say, right? Everybody's this is all on our free time. But having the ability to think critically of, you know, say shareholder loan accounts or due to due from accounts or, you know, management fees with this related company or rental expense. So, there's a lot of areas, a lot of accounts that have the potential for abuse, even things like employee expense reimbursements, that data analytics works well with, expense reimbursements. And again, if people think that their expense reimbursements are getting looked at, they're less likely to try to push things through the system, when they know somebody is going to be looking at it. So, yeah, I think some of the lessons that I've learned from like the litigation side and quite frankly, like the criminal cases, I've had to, tend to fall into some of those accounts where, you know, it's absent just straight cash, or it's not going to hit the books anyway. But if, if we're just thinking of, you know, there is a transaction that has a debit and a credit, and we see that there's, let's call it an expense, like the debit side of things that's floating through the general ledger, where could that credit go? I mean, it, it could go in that shareholder loan account. It could be from, you know, shareholder contributions. It could be in that due to due from account. There's lots of ways that this thing can go. And quite frankly, I still get out the T accounts and just kind of walk through like, well, wait, how does this even make sense? Closing: (17:22) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession, if you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Mitchell Powell: https://www.linkedin.com/in/mitchpowell2/FULL EPISODE TRANSCRIPTMitch: (00:05) Hello and welcome back for episode 86 of Count Me In on your host Mitch Roshong and I'm happy to bring you another engaging conversation on this accounting and finance podcast. Today's guest, Mitchell Powell, joins my cohost Adam to talk about financial performance management. Mitchell is the CFO at HJ Russell company, construction services, business, specializing in construction program management and property management. In this conversation, he introduces the concepts and uses for financial performance management software, and he also offers insight into how it can benefit your operations. So to learn and hear more, let's go over to the full episode now.   Adam: (00:51) So can you give us an overview of what financial performance management software is and how it is beneficial?   Mitchell: (01:03) Absolutely. So, I could talk all day about this stuff, generally, you know, in tech, finance generally and financial performance management particular, because, let's see, I probably started using this about 15 years ago and it has continued to evolve in terms of the sophistication and capabilities as well as pricing. So, you know, these products are now available to, you know, wider variety of companies that used to could afford them if you will. But for me, it's, you know, it's kind of financial performance management is just, you know, kind of one tool in the toolbox. If you think about all the tech involved in the finance operations, obviously the ERP systems to Excel, you know, whatever, this is just another one of those tools, but it's, it's kind of a critical one because it's kind of the glue that pulls everything together. And I guess as we talk about it, I'll illustrate with some examples, but it's funny, I actually came up with an analogy just before this call, and it's kinda like a carpenter, right? So all carpenters have their tools and there's some basics, right? So there's some fancy gizmos, not all of them need, but you know, you've got to have a hammer and you’ve got to have a saw. And so to me, it's like, if you see a carpenter with a handsaw spending all day, you know, kind of sawing wood and I show up and say, well, why don't you get an electric buzzsaw circular saw and you can do in 10 minutes, what you did, what's taking you all day. So it's really applying the right tech to what is a pretty complex operation, ultimately trying to pull together a lot of information in one place. You know, as I look back over the three years, I've been with my current employer and, you know, close to 10 at the previous, butwe do and I have to credit financial performance management applications with this, probably twice as much work if you will, in terms of, reporting and information provided, but we do it with less people. And so in the transformation that can be enabled through the appropriate application of technology in general, and in the case of this conversation for financial performance management properly implemented, it's a tool that really pulls together, all of your information in a single database. And so maybe what I should do is just give you just a broad overview of kind of what performance management software is and how it works. So, you know, many of your listeners have probably either had some exposure or have heard of some of the brands out there. There is Anaplan, Oracle, Hyperion, Adaptive planning. We use IBM Planning Analytics, which used to be called TM1 And it's subsequently been rebranded as IBM Planning Analytics through our acquisition, but that's the class of software that this is, and, you know, properly implemented, it pulls together in one place, all of our actuals from our GL and pulls together or budgets. And so you have a one place, the ability to kind of drill in and report with an agility and flexibility that you just couldn't, if you either had your data sets and different disparate places like budgets and Excel and all your actuals in your ERP. So this enables that kind of flexibility. So that in a nutshell is what financial performance management software is. Maybe what I should do is let me give you a kind of an example. It is, financial performance management software is a multidimensional database. So you, when you, when your data comes in, it's categorized, according to the typical ways you typically think about it in your business. And I'd say probably the five usual suspects, are of course the entity or company, the accounts, the period versions, whether that's a budget or a current forecast or actuals or whatever, more on that later, because that's a very powerful capability. And then lastly, the measure, he's talking about balances, activity so forth and so on. And so when data comes in, either through your budgeting process or your ERP, it's already, pre-calculated internally, according to the hierarchies you set up in those various dimensions. So obviously we have hierarchy set up for periods often for the companies and consolidations, obviously there's an account tree. And so to put all that in one place and then kind of categorized in those ways enables quite a bit of flexibility. So that, that's one of the two components generally in terms of how these various packages work. Is it's based on dimensions. and it's a typically called a multidimensional structure. The second is it's kind of like a blank slate.. So there are various BI packages that you can often buy. Some are associated with the various ERP systems. Some are offered by third party vendors, and often they are directed at a particular industry vertical or a particular solution. The class of products I'm referring to on the Anaplan, the IBM Planning Analytics, Adaptive planning, those are really more of a blank slates. So if you think about opening up an Excel spreadsheet, you have a blank slate. You can do anything you want to with it, and so these are products that you can, the sky is kind of the limit in terms of the kinds of things you can do with it in the same way as you think about an Excel spreadsheet. So it's extremely flexible to set up however you want to meet the needs of your particular business. So in terms of, you know, typical uses for these, I'd say there's probably two main things that they're often used for, reporting is a big one. I mean, it's a great reporting package. People struggle with reporting the export data to Excel and manipulate it, and so, you know, once your data is in this system and categorized correctly, and especially if you have, if whatever product you end up with operates through Excel as a reporting interface, which I think most of them do, certainly the one we use.Then you have a very flexible reporting interface, a very agile, and you can do some great ad hoc reporting. So reporting is number one, and then budgeting and planning, forecasting is the second kind of major category that people use these products for. And so I could talk all day about, you know, kind of the things that it will help you do to streamline your budgeting process, but maybe we'll talk about that a little later and then some other benefits besides those two main buckets, we have found that to be a tremendous benefit in streamlining our monthly close. We have found it to be a benefit in, various, consolidation exercises, ad hoc query and drill downs, great for that. And it's lastly a great, great control mechanism, both in the monthly close, as well as I could go through a whole list of stuff I probably will later. And it's also a great control mechanism. So in a nutshell, it's the place that everything comes together. It's kind of the glue that pulls your disparate data sources together and gives you a great deal of flexibility and agility on your reporting  Adam: (10:38) So reporting and consolidations were one of the several uses you mentioned. Can you give us some examples of how FPM improves that process in your organization?   Mitchell: (10:48) Absolutely. So, as I said, that's one of the main uses and, you know, the, the agility that this has given us and others who use these products, like what you do is just, it's just incredible. Again, thinking back to the basic structure where you've got the, your data as it comes in from either your ERP system or your budgeting is categorized by various hierarchies that you define. So if you just think about that, in combination with typically Excel as a reporting interface, you have a tremendous amount of flexibility to do some pretty agile reporting. One example that comes to mind, and this kind of gets to the setup as well. So none of this happens automatically. So, you know, you have the power of the product, but back to the blank slate Excel analogy you know, you can do all kinds of very complex things in Excel, but you have to kind of know how to use Excel as well. And so, you know, this example illustrates both the agility, but also the need to kind of think through your set up properly. We had a situation in which we wanted to look at, behavior of our accounts receivable for the first six months of the year, and so we have about 25 major customers in this particular use case. And so I looked at the cash flow statements and I said, okay, here's our, you know, kind of trend. It looks like our AR is building up.,and so I went to my controller and I said, I need to understand, you know, of these 25, which are kind of contributing to this trend that I'm seeing. And so she started by, as you would expect printing a listing of balances at the end of June. And I said, okay, that's fine, but if I want to look at the trend, I need to know what they were at the end of the previous month, and the previous month, previous months. In other words, in order to get to, the trend over time, which shows up, of course, on the cashflow statement, we need to know the balance each month. And so she spent about a day and a half kind of going through a little mini archeological dig and compiling that information. The thought occurred to us, okay, we've done this, let's go ahead and incorporate that into our data load so that we don't have to do this again. It's just part of our reporting, which we did. And so now, instead of having to go through an archeological dig, the next time that question is asked of us, we can literally just double click on a spreadsheet and it pulls out automatically the trend in, in those 25 different customers over time. And so we turned, and this is my point, we turned a day and a half process on an ad hoc process into a doubleclick, and I could go through example after example, after example where that kind of reporting flexibility, saves so much time and effort. And again, it comes down to value, right? So that the day and a half exercise was a low value add, right? I don't want my staff spending time on low value add activities,and so that's a pretty good example of the kinds of things that from a reporting perspective, it gives you. We'll probably talk about budgets maybe a little later on, but another area and reporting is a lot of people do this and they want to report some version of, you know, actuals to date forecast of some sort for the rest of the year and various mechanisms exist to do those kinds of things. But again, when you think about all your actually being in this, in this database and your forecast, whether it's the original budget or a current forecast, if you do rolling forecast and it's all in one place, and you have the ability very quickly to do that kind of actuals plus forecast, reporting, and there's some other things I'll probably talk about a little bit later, but you can, you can also do things like compare to previous forecasts and so forth. So that's reporting in a nutshell. From a consolidations standpoint, you know, that's probably another one of the biggest uses for these products, and I would probably divide that into kind of two buckets. One is the real simple one, which is just basically kind of thinking about your entity structure. A lot of companies, certainly that I've been involved with have a number of companies and areas and so forth, and they roll up into a certain way. It's pretty easy to define those kinds of hierarchies in your, in your data. And you can just report on various, report on your hierarchy. That's pretty easy. I think another area where it's very commonly used and we're starting to do more of this and I see a lot of companies do this, which is integrate disparate companies either through an acquisition or for some other reason that have different accounting systems. So if you think about, and we have this here, we don't, we don't have an acquisition per se, but we have entities and companies that have evolved over time, and so it's really a systems integration issue. So you get your data out of this RPE for one company and a different one for another company. And of course, it's all mapped to a master chart of accounts all the way in, but once it's in, then you have the ability to do reporting. And so this is very commonly used in the case of acquisitions in particular, or if you have the need to bring in data from other, other systems.   Adam: (18:01) So you keep mentioning planning and budgeting, you know, can we see how FPM addresses those needs?   Mitchell: (18:07) Absolutely. Again, that's one of the two major use cases here. You know, I can't even imagine, doing any kind of sophisticated budgeting, forecasting planning, without a capable FPM product, and you know, budgets in spreadsheets are the old way, of course, you know. I've seen countless situations where, you know, you'd do a bunch of budgets. Especially if you have a number of companies. I mean, it can get fairly complex. So in our case it is probably a decent example. We have, we have four divisions, in addition to four divisions, we have seven shared services, costs centers, you know, legal, IT, accounting, so forth, and so on, those of course get allocated out. And so if you think about a typical budgeting process, ah, you know, it's probably three months. It's Excel base, you've got spreadsheets being emailed back and forth. You'll have a who's on first version in question all the time. If something changes in one place, how do you roll it up and reflect it in the consolidations? And, it's just a miserable process. Everybody hates it.  It's time consuming, it's error prone, it's low value add. And so, you know, we have moved that situation to one where we do a rolling monthly forecast updates. And the only way you can possibly do that is if you have the systems to support that, right. You couldn't possibly go through that miserable process, I just described with any regularity at all, not even in quarterly. And so we've literally got it down to the point where people don't really even realize we're doing budget updates, because it has simply become part of our monthly close process. There are certain things that get updated. Some of them get updated automatically. Others are very automated  for those that require some degree of thought or input, and it's very, very powerful. And so we have, I would go as far as to say, completely eliminated the dreaded annual budget process. And the only way we could do that as having the proper technology. And so, just to drill down a little bit, to give you a kind of a real world sense of how that works, people still need to input budget stuff, right? And so there's a number of ways to get data into the system. as I mentioned, most of these products operate with an Excel interface. So we still have the option of entering budget data in Excel, but it doesn't live in Excel. It's written back to the database, and so that's key difference. So everything is in this one station, you have a point of control. So, that's the primary difference. To give you another little example. I had mentioned that we have several shared service cost centers that get allocated. If you think about what it would take to do that in Excel spreadsheets, perform the math, import that into other, to, you know, the operating expenses of the divisions that received those allocations, pretty miserable, prettyerror prone. We've got it to the point where it flows automatically from we actually created a little web based data input template for each of the shared services divisions. You change the number in the projection for the shared services division. It goes through and it gets automatically allocated and automatically shows up on the operating divisions financials. And there's nothing to think about. There's nothing manual. So what used to be a very time consuming error prone process is something that we don’t  think about it. And so it's pretty amazing when you think about the power that that can bring to an organization and the ability to do these kinds of rolling forecasts. You know, I think the concept of rolling forecast is generally becoming more accepted as best practices. The question is how you implement that. And, again, I don't think you could really do it with any efficiency at all without the proper technology. And so, like I say, we've got it down to the point that it's almost invisible. And, so, and another very powerful feature on the budgeting and forecasting I should probably mention, and this is pretty standard on these FPM applications is versioning. So if you think about, you know, your typical versions, you have actuals and budget, of course. And then if you have a, you want to do some form of rolling forecast or update your budget, so whatever you decide to do that, that's your current forecast. That's a version. You can take it a step further and do what we do, which is  do it monthly. And so we archive those numbers every time, every time we do the close and we update the forecast, it gets archived into a March forecast, April forecast, May forecast, and so on. There is a standard version that's called previous forecast. And so that, I may be getting ahead of myself cause I want to talk a little bit about the monthly close process, but, being able to compare to what you thought the numbers would be last time you did this to what they are now, which is to say, give me, compare my current numbers to my previous numbers. And it's automatic, I mean as long as you've got all your versions and your data, there is also a very powerful thing. So  in a  nutshell, you know, these, these, this is the magic that enables that kind of rolling forecast processes that are increasingly becoming accepted as, as best practice across the board.   Adam: (25:02) Definitely. So you keep mentioning this monthly close process and anybody who works in an accounting department knows how important it is to have an efficient, monthly close process. You know, you've even mentioned that you want to get rid of low value add activities for your, for the people that work for you is to make sure that they're doing things efficiently. You know, how has, can you give us some examples on how, the FPMs have been able to make the monthly close process more efficient?   Mitchell: (25:29) Yeah, absolutely. And so, I mean, there's a number of, typical things that happen in a monthly close. A lot of times the numbers are exported from your ERP into Excel, for manipulation and whatever, all kinds of things. Everybody knows that, we've pretty much eliminated, the need to export and manipulate. And if you think about this, I'll, I'll digress for just a moment, because this is for me, a fundamental guiding principle to the extent possible. You want an unbroken chain from your transaction level to the final report. There should be no case in that chain in which, the chain is broken, if you will, because if something changes back at your transaction level, you need to make an adjustment. You have to re-export re-manipulate and you have all kinds of possibilities for bad things to happen. Not to mention that it's inefficient. And so something as simple as exporting data to Excel to do various account reconciliations has now been replaced by, an Excel report that's hooked into the database. So it sounds pretty simple, you know, as you recall, Excel is one of the primary interfaces for many of these products. And so once you kind of write your report, you can pull in anything you want. And so that's live, if you need to make change, and then you just make your change, back in the GL, you pull a report on there it is. And so that kind of solves the problem of disconnected data, and so pretty basic stuff. There's a couple, I mean there that, so that's basic, I would consider that basic, you know, there's a number of very sophisticated things you can do, that's, again, replace, time consuming error prone processes with, with automation. And so I give you just a couple of examples. I mentioned that we have several shared services departments and, you know, not uncommon I'm sure. So I'm sure many of your listeners can relate, but each of these departments have costs for the month in question, and there's an allocation of some sort that goes out to operating divisions. And, so how do you do that? Right? And so the way it used to be done is print a GL for the month and key it into Excel and do the math, and take that and make a journal entry on the operating divisions. And again, you have several problems there, it's time consuming, you have the broken chain again. So now what we do is, it's been an evolution actually, I'll tell you where it, where the first step in the evolution and the second. The first step in the evolution was to say, okay, now that we have an FPM product that's hooked them to our GL effectively, let's write a report in Excel that just pulls that data in and does the math and creates a journal entry, which we might, could then say, upload if you structure it correctly. So that's a big improvement. You don't have to print anything, you don't have to rekey into Excel, and you can even maybe have that create an uploaded journal entry for you. It was a big improvement. So we were  pretty proud of that. I mean, that's, it helped us, I would say that was a benefit, so great. But then we got to thinking about and we said  you know, we can take this a step further rather than actually through the stuff, because we back up a second, what happens when something changes and it inevitably does, somebody reviews their numbers for whatever reason I changed while you've got to run it through that entire process again. And so you're kind of chasing our tails a little bit. So we said, wouldn't it be cool if instead of going through that, what is still a manual process, albeit somewhat more automated than it was, what if we set this up so that whatever numbers exist in a shared services department get automatically within the system, within the FPM product, to the associated operating division. So I'll stop there for a second and say, this is basically a top side entry. Most people in finance are familiar with the concept of the top side entry, where it's really an adjustment or entry that's made at the reporting level and not at the GL level. And so mechanically  , we set our FPM to, to take whatever's there and automatically via formula, not a process, a formula, allocate that to the divisions and what that means is two things. There is an unbroken chain. It's impossible for there to be an error or a lag or anything happened in the process of pulling data from the GL, doing the math, and then allocating it to the division. When a number is changed in any of the shared services department, it is automatically instantaneously reflected on all of the operations that receive an allocation of that department. And so we no longer have the chasing our tails doing this two or three times, you know, to fix errors or to repost when something changes. So we've basically taken, and this is the takeaway here, the entire process of allocating our shared services departments has been entirely eliminated from the close, think about that for the minute, entirely eliminated. And we're sure that it's always right instantaneously, because it's like an Excel spits a formula in Excel with one number changes, the associates number changes, right? It's that integrated. And then once we're done and we've issued the financials after the, after the close, then we go back and we take those entries that were computed and posted if you will, as a top site and post them in the GL. So it's basically a moving something from the monthend peak to sometime afterwards. So, and again, that's a basic principle of a fast close, when you can take things and you can move it, you can do it either before or in a rears. And that's what we've done.   Closing: (33:05) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession, if you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Sangeeta Sumesh: https://www.linkedin.com/in/sangeetasumesh/Sangeeta's Website: http://sss.coach/"What the Finance" Book: https://www.amazon.in/What-Finance-Easy-learn-entrepreneurs/dp/1645467961FULL EPISODE TRANSCRIPTAdam: (00:00) Welcome back to Count Me In. IMA's podcast about all things affecting the accounting and finance world. This is Adam Larson, and I'm your host who will be introducing you to our bonus episode's guest speaker, Sangeeta Shankaran Sumesh. Sangeeta is a chartered accountant and management accountant with over two decades of experience, including leadership positions with multinationals across geographies, and most recently serving as executive director and CFO of Dun & Bradstreet Technologies. In this conversation by cohost Rouba Zeidan talks with Sangeeta about various aspects of being an influential woman in finance, including gender equality, rising up the corporate ladder and the importance of leadership and career optimization amid COVID-19. So to hear more, let's head over to their conversation now. Rouba: (00:59) So good morning Sangeeta, and thank you so much for joining us on Count Me In’s podcast this morning. Sangeeta: (01:07) Very good morning Rouba. It is great to connect with you, and pleasure being on your show. Rouba: (01:13) So I have so many questions for you because India is one of our biggest regions for IMA globally, and we're very keen to learn more about your experience as a seasoned finance professional and a woman. So women in finance in India represent a mere 11% compared to 16% globally. I personally find these figures a little shocking and an indication that much work, I mean, even on the global stage, don't get me wrong and that much work still needs to be done to establish gender equality within the finance sector. But what comes to mind when I mentioned this to you? I mean, what is your takeout from this. Sangeeta: (01:50) To be honest I find it ironical and surprising as well because you're right to say that the percentage is pretty less, but you know, if you look at women, I think woman are actually so good with money management. It is woman who are actually running them,  how big or small the budget, maybe, you know, they like to fit everything in within that, and it's so beautiful and they're so efficient and they don't even need assistance there. To come to think, logically speaking, there must be a lot more women in finance, which I find it surprising that it's not the case. But having said that I think  there are a lot more of the women who are a lot younger who want to get into finance, and I think there are  already quite a few of them in the finance domain compared to lets say a you know few decades ago. So in that way, it's kind of promising, and I think it all it needs is I think most women have to overcome this mental resistance. I think some of them tend to get bogged down because if you look at the CFO's nominee, you know the number two position, you know right hand of the CEO and stuff like that, so woman need to come out of this mental resistance and at the same time, I think they need a lot more motivation and they need to be encouraged by the seniors, the male colleagues, and definitely their family as well. Rouba: (03:08) From your personal experience. Have there been any particular challenges that you faced when it came to promotions and climbing up the corporate ladder? I mean, as you mentioned, it's important to have a support system at home, as well as within the companies that you work in, but for you personally, how has it been? Has there been a limitation and you know, the, the facilitation of you're climbing up that ladder, professionally? Sangeeta: (03:31) I think I have been really blessed, you know, because the kind of mindset my parents in calculating within me when I was younger was that gender has never been an issue. So it's either that you are capable of achieving what you want to achieve or not. So it was like, you know, coming down to my individual cells and I think ignorance is bliss because, you know, during my growing up years in, especially in my career, it was not this so much stops on this gender equality and all that. So, and coming from this background and the mindset, so it was more like, you know, am I capable of achieving this? Can I do this? Can I grow? Can I balance my family and my career? It was always those types of thoughts. So I strongly believe that, you know, a person, I mean, male or female, whoever is able to add value. I think, you know, all the promotions and everything else becomes secondary. So firstly, you must have the confidence in you. You know, I always say, when you want to start off your career, you should just take a pause and ask yourself, why do you want the career for yourself? What is it? Yes, yes. So you need to first be aware and clear of why you want to get up. And of course, if not, you can always explore other options, like, you know, work from home or entrepreneurship or anything like that. So I think this gender thing, you know, I think a person must remove doubt and, you know, focus on adding value. And what is it, how are you contributing to the organization. Then I think your growth becomes quite automatic. In my instance, I think I was really, really blessed. When my son was born, I was promoted as assistant manager, my daughter was born, I was promoted as a manager. You know, everything happened at the same time and yes, I must admit, yeah, it was actually overwhelming because I was a new mom and the new responsibilities at work, and you already facing the postpartum blues as well. So it was a bit of a challenge that way. But I think, you know, once you're able to tide over that and you know, you have your set career goals, your own self. And go by that, I think that's a lot better. Rouba: (05:42) Brilliant and very empowering advice, by the way, in the Arab world, we have a saying that every child comes with his own fortune. So I guess that manifested in the promotions that you are in Sangeeta: (05:53) Yeah. Rouba: (05:53) So you've done really well in your career and as a leader in your industry and amidst such a turning point in history, not just on the Indian economies platform, but also globally. So what kind of leadership transformation are you looking to implement or at least propose and suggest and facilitate within your organization? And is that something that you're working on currently in your capacity? Sangeeta: (06:19) Right, before we even dive into this.. You know, I want to talk about this wonderful experience that I had. So I'm also a high performance business coach. So I think about a year ago, I conducted a leadership workshop for some of the CXOs. You know, we have a CXO club here and I did like a workshop on leadership. So it was all very senior leaders from different industries were present. And what emerged the end of the workshop was something so beautiful.  They came of with five very important aspects for any leader. This will get more out of self realization and everything, and the reason I want to share this here is I think, you know, in respect to the current crisis,  or anything you know as a leader, I think these are very valuable things. So the first thing that they said was, you know, the listening skills. Many times leaders, you know, we're so caught up in our own things that, you know, we don't even listen to what the team members feeling, what are they viewpoints? Yeah, so that becomes very important. So it was surprising that not a lot of them even admitted to the fact that their listening skills are a good thing. Everybody committed to working on them. So once this awareness is there, I think that had, so the first is the listening skills. The second was on appreciation. You know, do we even go out and appreciate our team members for work That they done well, whatever you like you know. Yeah, okay, fine, you're done with this, okay, what's next? Or, you know, criticizing and saying, you know, this was not done, right. This is not done we. It was not on time, it could have been better, but you know, if it comes out in a positive way, in an appreciating manner, I think the team was also motivated to do more. The second was the appreciation. The third aspect was the learning. Even though you may be a leader, I think it's really important for you to keep learning and, you know, being up to date with what's happening in your industries and you know, knowledge is power. So once you know everything, you're also in a position to guide your team in a better matter. So third was on the learning and the fourth was ego., You know, they were saying ego sometimes, yeah, tends to come in the way, because, you know, as a leader, you think, you know more, but if somebody wants to, you know, saying something,. Rouba: (08:39) And you're expected to always have the answers. I mean, it's that kind of a catch 22 for leaders? Sangeeta: (08:44) Absolutely. Absolutely Yes. Yes. So the ego was also playing and the last point was, you know, how mindful are you in your actions? Because the team is always like, you know, looking upon you as a leader. So, you know, every little thing that you do, how mindful are you doing? You know, take them along with you. How was your presence being said? So you know all the actions that you take and all this. So, I think these five points that I mentioned that is like, you know, listening, appreciation, learning, ego and the mindfulness, I think it's very relevant at any point in time for a leader. So once you go that extra mile, you may be like, you know, very, very good in your domain, you may be expert. But if you don't have good team handling skills and you know, if you're not able to come across as a leader, a leader is not necessarily being a boss. Rouba: (09:43) Absolutely, that's one of the biggest misconceptions of the 21st century. Sangeeta: (09:46) That's right. That's right. That's right. So I think these were very good lessons that remained with a lot of people. I love to share them because I think it's, you know, the kind of transformation that I would really like is since I'm a coach, I like to have the coaching mindset on and you know, I like to wear the hat of a coach. So I'm like, you know, always trying to see what way I can maximize potentials, nurture the team. Rouba: (10:13) I can sense a lot of empowerment coming from you. So I think the coaching element is quite a good fit for you and which, which brings me to my next point about the human element, you know, being such a fundamental aspect of organizations everywhere in the world. And so trying to juggle business priorities with staff's mental wellness, for example, would be a potential challenge. But how much of a priority is that for you personally? And then what are the steps? I mean, you've mentioned all of the work that you've been doing on a leadership level because that's the top down animal, which is wonderful, but what other steps are you taking to safeguard your teams as they operate within this abnormal, normal? Sangeeta: (10:58) So, contradictory you know, to most finance people, I normally wouldn't like to say human resources, but I would say human capital, because I think, you know, the people are the most important asset of any organization. You know, I remember when I've been on a holiday to Glasgow in Scotland, there were huge banners that say  “ The people make Glasgow,” which is so true even for an organization. I mean, it's people who actually make what the organization is all about. So once we are able to acknowledge this to say, you know, the people are the most important asset and everything else becomes secondary. So people are not machines, we're not global, right? So we need to have feelings and, you know, we need to see how to capitalize on that. Especially as leaders, we need to display empathy, we have to see what sort of mental support can be given to people at times they require. So I think those are very critical, you know, you're like, you know, it cant be all about just work, you know, there's a lot more to it, you need to have that relationship build, and then the rapport and the progress meter. So I think what has worked pretty well for me personally, and, you know, I do tell my other colleagues team members what I follow is yoga and meditation. So I have personally been into active living for I think the last what 15 some odd years, and its sincerely helped me is simple breathing exercises. So like every morning, itt's like become a routine like how you brush your teeth and bathe every morning. I set aside about 15-20 minutes, you know I ensure I do these  simple breathing exercises and that has really helped me to de-stress and has taken me all the way to, I would say so I definitely encourage people. So even at work, you know, we keep having shop workshops or, you know, desktop yoga, you have people coming in talking about nutrition and stuff like that, so that people, you know, you need to look at it from the other side as well, trying to see what, what is the best thing that can be done Rouba: (13:03) So, that kind of puts a lot of focus on, as you mentioned, the human capital, not the human element, which is wonderful. It is capital indeed, but then you know contrasting that with the essential role of the business element, you know, the business continuity side of things. So one of the 101 statements that business figures are extremely familiar with is cashflow is king, and how does that play out at such a turning point in history and how can companies safeguard that cashflow without having to let go of their staff or putting them on furloughs, which is kind of the magic switch that immediately manages cash flow. Sangeeta: (13:40) So like you said, yeah, cash is King, cash is also oxygen, I would say, you know, because even without cash you can't do any business. So what is required is a whole lot of cash planning. So, you know, what I always say is your cash outflows under your control, but not your cash inflow. So especially in places like this, you know, what you can really control at this point in time is your cash out flow. So I would like restate the five things again on how you can be proactive and see how you can get tons of cash. So the first thing I would say is, you know, bucket all your cash out flow into highly essential, essential, and non essential. So that way, you know which one to prioritize.  If it is something highly essentially, you definitely have to go for it . Essential is your are depending on your cash situation, and of course non-essential during times of crisis. So one is planning these expenses. Two can be on the tax planning. What can you really do as an offer from the organization perspective, so right now, you know, every drop matters. So maybe a good idea to go to and see what sort of tax planning can be done. Third would also be to see if there are any special government fees or benefits that are being offered. So, you know, considering the crisis, I mean, even globally, it may be a good option to check what are the schemes that are typical, how you get benefited from them So that would be option number three. Fourth would obviously be to renegotiate for better terms and conditions of both your customers and your suppliers to see how you can go that extra mile and create better cash situation for you.  And fifth would be to explore the possibilities, you know, along with your teams, because, you know, once you take the team as part of the bigger team, then you can actually end up creating a win-win  situation. Like I know of a friend, you know, he runs a small business, and obviously the business it was greatly affected by the crisis and what he actually did , and he did not have a cash run he didn't have enough cash. So what he actually did was he took it upon himself, and got a team and this is the cash situation I have and you know how business is right now, so what is it that you want me to do? And when he put this out, so the team said like, you know, it's all right, let's all go for a 50% salary cut right now. And then, you know,  at a later date, when the business picks up, probably we could be compensated with bonuses and stuff. So he like makes a lot of difference when it comes from the staff, rather than you telling them, Hey, you know, I am going to cut 50% of your salary, or I want you to go on furlough.  You know there is a lot of difference when it's created from within. So I think that if you take everybody together as a team and definitely, you know, many brains is better than one single brain, you get a lot more ideas as well. Rouba: (16:55) If they're willing to listen, of course, and ego is not in the way. Sangeeta: (17:01) Yeah, but I think the beauty of the human being is, you know, especially during times of crisis and challenging times, I think most of the times, most people can come together, and support each other. It's in the welfare of everybody, the individual and the organization, so I think that is pretty good. So the important thing is to communicate, you know, obviously communicate, communicate, communicate, because getting everybody to be aware of what's really happening, and how they are being affecting. I always, not to sound preachy, but then I like to keep stressing on the importance of cash. So I have looked to this book. called "What The Finance, "it has become a best seller. So based on that, every week I keep posting on  my YouTube channel. It’s called, “  “ so I keep posting different 3-4 minute tid-bits on finance, and most of these are on cash especially on the current scenario. I keep telling people like how you need to conserve cash, especially if you’re an entrepreneur or SME how cash is crucial.  And it is funny before this crisis, I always used to say that you really need to get into the habit of creating reserves. So if you notice right now people who had good amount of reserves, at least they can manage and get ends meet. So I think that is important. And what I also normally like to give is an acronym, and the acronym is C.A.S.H. C is to collect on time. A is to anticipate your inflow and outflow. S is to systematically monitor. And H is the habit of reserves. So these are the basic principles for any business. Rouba: (18:59) So cashflow is queen indeed. That's amazing advice. Thank you for that. I'm sure our listeners are gonna benefit from especially people within the finance function. I have one last question for you as an ambitious career-driven woman. What is your advice to, you know, young, I was going to say women only, but in your case, since you've completely neutralized the gender gap, something that I genuinely value, and I respect you for, what would you say to a young woman or man who are entering the finance profession today? What would be your advice to them? Sangeeta: (19:39) Just one thing: let your work speak for itself. So once you've given your very best, nobody can really dispute that, you know, once you're able to add value and contribute to the organization with growth and success. Everything else becomes secondary like gender or difference of opinion everything else will fall apart. So the best way to shut the voices of others is to just prove yourself, believe in yourself, know that you have the capacity and potential to really get what you want. I think that is your driving factor, then it makes life a whole lot easier for everybody. Closing: (20:24) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Russell Porter: https://www.linkedin.com/in/russporter42/FULL EPISODE TRANSCRIPTAdam: (00:05) Welcome back for episode 85 of Count Me In I'm your host, Adam Larson and today's conversation features IBM's Vice President of Finance and Global Business Services, Russell Porter. Russell has been with IBM for over 20 years, serving in roles spanning most financial disciplines in business units. He is a strong leader with a high aptitude for merging strategy and operations. In this episode, he really focuses his insights on how to lead and manage remote teams during these ongoing times of uncertainty. Russell explains IBM's current status and upcoming plans, as well as what he has done along the way to keep his team motivated and achieving. Keep listening, as we head over to this very timely and valuable conversation. Mitch: (00:55) Many leaders were faced with a task of quickly adapting their management strategies to remote work following the coronavirus pandemic. What were some of the strategies that you implemented in the beginning of this for the whole work from home environment, and how did you go about keeping your team together? Russell: (01:13) Mitch, in any situation, you know, one of the best things we can do is provide some clarity for our people. Discussing what we expect to happen, what we know, what we don't know and, and how we're going to make decisions as we all work through the issues that face us. In addition, one of the things we did was reinforced clarity around our organization's mission, and tried to make sure that each person continually understood their role in that overall mission. That helps people to stay connected and engaged, as we went through, you know, the, the vast uncertainty of those early days of the pandemic. We also noted that we needed a greater focus on empathy. You know, our team members all face different situations from those who are suddenly homeschooling their children to others who are concerned about aging parents and some who were cut off from the bulk of the social engagement that they had by not being able to go to work. You know, there's a saying that everyone's fighting a battle that we know nothing about, and we need to keep that in mind as leaders when we're working with our people, especially when we can't be physically with them, as much as we're used to.  That led us to realize we also had to be more flexible. You know, the work getting done is more important than exactly how it gets done. So at IBM we've got existing flex time programs that we just leveraged across the board. You know it allows people to attend to their daily needs while getting work done at what some would consider off shift hours. Now, not everything can happen that way, but to a great extent, our teams could modify their workdays to be early in the morning, late at night, or even split into pieces based upon all the other priorities they had to address. That took some creativity at times, and we had to change some structures like the workday times or some job design. And it was a great time actually to tap into our team's creativity, because they helped us develop some of those solutions to address the individual’s responsibilities and the individual's requirements and the job environment. The biggest thing we did though was communication, communication, communication. We were fortunate in IBM, we we've implemented agile methodologies in a lot of our work within finance and operations. So one of those, one of those methods is a daily standup meeting, and that really provided us a great check-in opportunity for our leaders and our teams to share those experiences and their concerns, and to make sure that our teams remained engaged in the work, but also that we could talk to them about what was going on outside of the work environment. That regular communication has really helped us to communicate both vertically and laterally across the organization. So a regular checkpoint with the team is key. But also as, as I've seen lots of people talking about the one thing that's missing in this virtual environment is the impromptu run into the hallways connection. That time when you're just walking down the hall and you see somebody and you think, oh, I meant to talk to them about an idea. So reaching out and keeping up networking and your contacts within your organization and outside, and being able to communicate across the small teams that we work in, that was also a big thing. And that was enabled by the technology and tools that we had adopted already. We were already doing video conferencing with WebEx and instant messaging, which we adopted with Slack earlier this year. Cloud based file repositories. All of these went from being ancillary to becoming like the primary mode of communication around the, around the organization, and I think the fact that we are already progressed with those tools, or at least had started with them, helped us adopt and adapt very, very quickly to what became a full time virtual environment. Mitch: (05:14) That's great that you had so much prepared and were able to implement so quickly, you know, I'm sure during this rapid change, and it was certainly a lot of uncertainty for everybody, even with plans in place like this, there must've still been a lot of questions from the team members, right? So what were some of the main concerns that you were hearing from your team while all this was going on, and how did you as a leader, go about addressing them? Russell: (05:40) So I'll tell you the number one question I kept getting was when are we going back to back to the office? And here again, knowing individual circumstances, I've got extroverts and introverts on my team, and the extroverts, you know, when they heard that we are going to be working virtually for a while., they wanted to get back to the office as quickly as possible. And, and working from home, working from bedrooms or living rooms on their own was really driving them a little nuts. So a lot of people thought it was going to be a one or two week closure of the offices to get past a peak period. But as the days turned into weeks, that question of when are we going back to the office became more and more insistent. You know, again, the best we could do was provide the clarity that we didn't know. And, and I'm in the Northeast. So, you know, in the Connecticut, New York area, and we had to tell our people, we didn't know. It was dependent first firstly, upon state regulations, but then also upon, the company's way that they wanted to approach coming back to the office, given that we've never had a time when the virus wasn't somewhere in the IBM office offices, or in the environments, I should say the States where, IBM operates. So, number one question was when are we gonna get back to the office? And we gave as much clarity as we could. Number two, job was, well, how are we going to get our jobs done the way we're used to doing them? And the answer was, we're not. We’re simply we needed to adapt to this new virtual environment there, wasn't going to be, you know, printing of documents, and, and there wasn't going to be the huddling in a physical conference room to go over charts, to go over analysis, to, to present ideas. Suddenly we all had to go virtual and that required a little bit of change, and the way we did things and the way we shared. It wasn't marking up and standing in front of a screen. It was, you know, trying to point at something with your, with your mouse and a little arrow on WebEx. but here again, it was adoption of the technology that helped us adapt and, and continue to be productive as a finance and operations organization. And what we actually found was within FNO, we really didn't skip a beat. We were able to modify the way we did things, everything from presentations and analysis to, you know, approvals, everything got, got swept up very quickly. And within, I would say 30 days, we were operating, like we'd been operating in this form forever. Mitch: (08:17) That's great, and that's a very, quick, you know, adaption to the new way of doing business, and, you know, you mentioned this was a couple months ago now, right? And within 30 days, things certainly picked up for you. I know here in the United States and many other places across the world, there are businesses that are opening up. So, you know, based on what you've shared already, can you please tell us, you know, how is IBM currently conducting their business? And is there anything that you have already planned, as far as a return to work policy and how you would support those who maybe are those introverts like you, or those who are hesitant to go back for whatever reason and are not comfortable in the office? Russell: (09:04) Now, I completely understand that hesitation, and right now there are so many discussions and debates going on around the country about opening offices and schools. No one wants to see the infection rates start to spike up again. So at IBM, we're still operating at well over 90% virtual capacity right now around the world. And we're engaging with our clients, our suppliers, our team members, all through only virtual means. And to a large part, we found it largely effective. That said there are some countries and some cultures around the world where in person meetings are really difficult to replace. Now, we've been really public about the fact that IBM is going to take a conservative approach in our return to our offices. And we're seeing lots of other companies that are saying the same thing, that this is going to be out of the office for an extended period of time. For us, we're going to have a multi wave plan in which our critical client facing and our teams where collaboration is absolutely critical. They're going to be the first back in the office, and they'll be observing a lot of new protocols to help ensure that they're doing so safely. Everything from lower space density usage, and daily checkpoints of health conditions. Minimization of use of conference rooms, and obviously masks and social distancing are going to be a big part of that. IBM's actually develops a new tools to facilitate that transition transition for us and for our clients called Watson Works, which is designed to help assess, help employee assess themselves before they come into the office and help manage the interior office space to make sure that we're not overcrowding or putting our people into a difficult situation. Now, after that initial re-introduction, we're going to gradually increase the percent of the population going back to the office slowly and deliberately over time. And we're going to put priority on those organizations where face to face interaction is pivotable. Now my organization in finance and operations, we're likely going to be in the later stages. We've been pretty effective in working virtually for, for a long period of time. So I'm expecting, we'll be working from home at least through the end of the year and probably beyond that. And I'm sure that, and this is true for everybody, I'm sure. We won't go back to our offices and same way we did before. Masks, social distancing, staggered scheduling, low density, that's going to be the norm for the foreseeable future. And from my perspective, it follows that if part of our team is always going to be off site, because I don't think my whole team will be onsite altogether again, for quite some time. Then our practices of engaging the remote teams through video conferencing and Slack and file sharing. All of that's going to continue for the foreseeable future as well. So the office may become less of a place, we go to work our nine to five, and more of a place where we go to have those critical in person meetings, but most of the work will continue to be conducted offsite, wherever possible with a digital connection to those who might be in the office, but really the majority who are going to be continuing to work from home. Mitch: (12:25) Well, it sounds like those are great solutions, and I know just in reading through the news and watching, you know, as you said, it sounds pretty standard for many businesses these days. but everything you just discussed really has a very positive spin on it, and that's something I really want to emphasize. I feel like we talk about this and it's always kind of the downside of what's going on, but how about some of the positives that you have realized? What have you seen over the last three, four months, however long it's been that has really enhanced your business, or some individuals productivity or engagement, you know, what's the positive side of everything going on right now? Russell: (13:03) So there are a lot of positives. There's always a, a silver lining around the cloud.  From IBM's perspective, first of all, we've got a global workforce, and within finance and operations, we've always had a number of people who work away from IBM's primary sites, whether it's in their home or in a satellite site, and as managers and leaders, we now have a greater appreciation for the challenges that those people have faced for a long time. Those people who are already working remote, they adapted like it was nothing because it was continuing to do what they've always done. So as managers and leaders, we understand a little bit more of that perspective. In addition, as, as our clients have gone through this transition, it has created opportunities for IBM to serve our clients in new and different ways, helping them get farther along in their own digital strategies. So, there are elements of our business that we've been able to leverage to help our clients adapt to these environments as well. Internally, we've also been able to help, adopt our collaboration tools like the ones I've mentioned before Slack and WebEx. A lot of these were on our plate, prior to the pandemic, but they've been far more readily adopted as a result of the pandemic than they would have been earlier. And I think that's going to have a permanent and beneficial change to the way that IBM can operate, and that's true of almost any organization. It's another tool in the toolbox to allow for collaboration, communication, leadership of our teams, wherever they may sit. And of course the one, the one benefit I hear a lot is a no commute. I work in an area where typically people are commuting 45 minutes to an hour each way every day, and people have, people have really used that extra time for a lot of beneficial reasons. They've, they've improved their home lives. They're more engaged, they're sleeping better, they're exercising more frequently, and the number of new dogs that have shown up on my WebEx is in the background, have been, has been one of the joys of seeing how people have expanded their families in a variety of different ways. Mitch: (15:25) That's great. I know we have very similar circumstances as well, and, situations that a little impromptu, a sigh of relief and nice smile. It's something that's certainly welcomed throughout the day. You know, just to wrap up this conversation, this has been great, and I appreciate all your insight. You know, a lot of people have adapted and are doing well, as you said, there are many positives, but you know, looking ahead, those who are going to continue to work remotely, in your opinion, how do you suggest maintaining motivation? What can you share with our listeners who are leading remote teams or are remote workers and are looking for some added incentive, what do you have to offer them? Russell: (16:06) So I always, I go back to the basics on this and I'm going to end where I started, I think. Number one, you know, keeping our teams productive means keeping them engaged, making sure they understand, you know, our mission as an organization, and again, they're part of it. People want to see the value of the work they do, and how it contributes to the team. And in order to really engage people, you need to be empathetic. You need to be able to understand the off-camera issues that your, our team members are facing, and discuss those issues with them, be creative, helping them find solutions, or even just to listen. Some of our team members are likely experiencing, you know, loneliness away from the office, spending time, just being with those people, and helping them to, you know, showing that you really care about them as people, not just as workers. It does help to keep them engaged and keep them productive. But I think it also just helps them deal better with the challenges that might be coming their way. e\Even those that we don't see. And also a little bit of flexibility, creativity and fun. We've got a WebEx coffee hour or a happy hour every two weeks or so. One of the rules is we're not allowed to talk about work, we invariably do. But we try to spend time talking about what's going on in our families. What interesting things we've been doing for, you know, adventure, whether that's hiking or kayaking or, going out and running. And as I said, you know, we get to, we get introduced to new family members, you know, dogs, cats, a turtle in one case. And in one case recently, a new baby that joined the family. So, helping to keep it fun, keep it lighthearted, keep the teams engaged, that pays a lot of dividends in terms of people's willingness to put forward the extra effort when it's required, and these days to put forward the extra effort when it feels like at times, you know, they're on their own. Making the time to socialize, making the time to spend some quality time with our teams, that's really critical in, in helping all of our organizations achieve their end objectives and keeping our teams engaged, and, and dare I say, happy. Closing: (18:33) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Jason Krantz: https://www.linkedin.com/in/jasonkrantz/Strategy Titan: www.strategytitan.com https://www.linkedin.com/company/strategytitan/about/ "Data & Analytics in the Boardroom: Raising Your Digital Quotient" Video Series: https://www.strategytitan.com/blog/data-analytics-in-the-boardroom-raising-your-digital-quotient-video-series Build out your “business and finance” centric data and analytical skills with our practice dataset. Perfect for accounting and finance pros looking to develop their data skills: https://www.strategytitan.com/blog/titanized-real-world-dataset-to-develop-your-analytics-muscle Podcast: https://anchor.fm/transformationnationAdditional Work: Using data and analytics to make business decisions with confidence during times of uncertainty: https://www.forbes.com/sites/brentdykes/2020/04/29/why-your-business-must-double-down-on-data/#6e180f597a68FULL EPISODE TRANSCRIPTAdam: (00:05) Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson. I'm here to bring you episode 84 of our series. Today's feature presenter is Founder and CEO of Strategy Titan, Jason Krantz. Strategy Titan is a strategic management data and analytics advisory firm, and Jason is a business professional with over 10 years of business analytics, data science, and strategic leadership experience. In this episode, he shares his perspective on data, analytics and strategy and explains how these functions of the organization need to ultimately drive your overall business strategy. Jason talks about the products that have great opportunity to increase your firm's revenue by connecting these strategies, and how aligning your businesses strategies helps mitigate risk. Keep listening and will now head over to a very insightful and analytical conversation.   Mitch: (01:05) Alright, so Jason we just were having a brief conversation before we started here and, you know, we were talking a lot about the importance and the value of this conversation. So to start us off, why is a data and analytics strategy so important for innovation today?   Jason: (01:21) Yeah, in my mind, really what it does is it gets down to identifying opportunities. They're going to move the needle strategically and financially ever. All of us have financial goals, revenue, goals, growth goals, whatever it may be. I'll just give a real example. I like to use examples to illustrate these concepts, to move them from fuzzy to concrete. I used to work for a company $2 billion company. We are an industry consolidators. We acquired numerous companies. We had everybody on different ERP platforms, something I'm sure a lot of people can relate to. Each company really had a different behavior profile on the way that they did things. So, me being in analytics for practicing this company, one of my first jobs was to consolidate all this information and start looking at it, look for opportunities. Now we had pretty big, EBITDA growth goals. We were tightly focused on EBITDA growth as, our strategic objectives. And so as we're looking through this, we find out that we have well over $10 million in uncollected freight. Now this was freight that we're owed. You know, we just had not gone out and collected it. And as we looked at it, started asking questions saying, Hey, why is it that we do this? Like, Oh, well, you know, it's in our contract that we can do this, but we typically let it go. Or, you know, it's just, we we've done it this way for so long. So every company was doing it a different way, but the common theme was this freight recovery. So as we looked at it, we're like, you know, we can actually make about $14 million if we just collect the freight that we're owed. Not only, let's not even account for freight increases for gas, whatever it may be surcharges. And as we brought to some management team, they're like, how could this be? And this is, we got everybody aligned behind it, they said, this was a serious opportunity. This is a process improvement opportunity. This is real money that will impact the bottom line and help us meet our objectives. Now, the reason I share that story is analytics by itself didn't do anything. We didn't actually collect that money or drive that force forward. But what it did is it served as a tool to identify the opportunity that if we never went, I would have gone through that process. We never would have identified that opportunity. We would not have socialized it and gotten everybody to see, wow, this is something very significant and a lot of times, growth comes from, you know, looking outside for new initiatives or whatever it may be, but a lot of times now you've seen this time and time. Again, a lot of times there's opportunities sitting right underneath our noses. I call these piles of money, just sitting around, waiting to be picked up. And it's, you know, it's one of these things where this insight it wasn't anything revolutionary, but it was very significant in that it could help us move the financial needle. And that's what gets me excited about analytics ant data is its ability to identify concrete opportunities like that, to help improve business results. You know, it's not all ponies and unicorns. This is real stuff.   Mitch: (04:31) So I just want to pause for one second. You just said analytics and data,and for clarification, my first question I did ask data and analytics. So what I would like to do is for our listeners, if you can offer a distinction and define the difference between data and analytics like we're talking about and data analytics in your perspective  Jason: (04:50) Yeah, sure. Great question. So, you know, I separate data and analytics as I see them as being vastly different topics. Now I will fully admit  upfront, these are my biases. These are the ways that I view the world and not saying it's necessarily a correct quote unquote, but for me, data has a much heavier infrastructure and asset management perspective to me. Now I say asset management, because I do look at data as an asset. I know it's not on the balance sheet,as an intangible asset, but it is.Our accounting rules have not evolved it, but I think we will get to that point. So things like master data management, governance, security, database management, and other backend activities, these are really important. But from my perspective, they mean little to the strategic side of the equation, from the perspective of the business. Now, again, that's not to say that it's not important, you know, data breaches things, we've all seen. Those are extremely serious things, but it's a different process, where analytics is more front end and strategy focused to me, the business's extremely interested in that. So that's why I look at these things as two totally separate things. The analogy I use is, you know, and it's very cliche, but data is oil, and then the analytic process, is plastic. Oil serves as the raw material to make a bunch of different things out of plastic, and in the same way, data serves as a raw material to do all sorts of strategic analytic and business analytic things. but in both cases you can't have that end product without the raw material. So the process though of sourcing and transforming that raw material is a process in and of itself. So getting that oil and transforming it is a process, getting the data, storing a transforming, it is a process, but then the design creation, marketing sales and distribution of those end products, you know, that analytics process is totally different. Data analytics, to me, it conveys a heavier focus on the mechanics of analysis. And so you're just for me, I prefer to take a very heavy output in business results perspective, because what I've observed is that we focused on the genetics. It tends to be harder to be effective with kind of the implementation of these findings and drive strategy, drive results, and persuade people to do things different.   Mitch: (07:26) All right. Thank you for clarifying that. I think it makes total sense and I appreciate your distinction there, and now we're going to kind of take a step forward with all that in mind. Why does this strategy really need to be an executive or even board level topic, you know, depending on our audience, why is this such a valuable topic to be discussed?   Jason: (07:47) Yeah, so I would say one thing is it depends on your industry, right? As always, it depends. But I would say for most industries, you know, at least the industries, I work in manufacturing, wholesale trade, kind of industrial, what I call dirtier industries in general. And I'll say in general, very broad brush strokes. They tend to be less further along on the data and analytics, maturation curve, you know, manufacturing let's use as an example. Within the four walls, they're incredibly skilled at that year. You got your Kanban  six Sigma, continuous improvement, all these different things that within the four walls are very well oiled machines. These are things they've been doing for since World War one, I think. But when you look outside your four walls, that process tends to be far less developed and in a lot of what I've done in my career, in manufacturing and wholesale trade and industrial, a lot of the significant value has been derived from looking at those things outside the four walls. And the reason why I kind of preface my response with that is that if you're used to looking within the four walls, you need to build a new innovation in mindset and strategic muscles to really start looking at what can we do outside of our four walls, and that's a big muscle to build because we're creatures of habit. We do things that we're familiar with. Change is hard. So as we look at this as an executive or board level topic, the reason why it's important is because I personally see this as being one of the most effective approaches for identifying and creating new and innovative strategies. You know, it's the raw materials for understanding your markets better. It's really important for deploying your resources effectively and mitigating risk, and when I say deploying resources effectively, it gets down to that ROI equation. What are the strategic items that you have on your agenda? What is the risk associated with those? What is the potential return, but sometimes, and I've observed this time and time in my career, which is why I'm so passionate about this. Sometimes there'll be strategic opportunities that are very significant, extremely low risk that are right underneath our noses, Aad we might not even be aware of them. And I go back to that freight example. That is a real example that I've seen play out time and time and time again in multiple organizations. It's almost, it's almost like, well, how, you know, you assume that you're doing these things, but if nobody really looks at it or, you know, another great example is our total cost to serve for your customer base. Like, okay, you've got your gross margin, your contribution margin, material margin, but what's your, you know, after you look at all that stuff, what's your total cost of care for your customer base. Most companies will be blown away to observe that most of those customers that they thought they were probably making a lot of money on after you account for all things like freight being a part of that equation, you're gonna actually be losing significant sums of money. And again, I say that just because I personally have observed that that's how I've made a career out of this stuff is finding these things that they're not crazy. They're not revolutionary. And as a result, you know, they're not the sexiest thing in the world, but for a lot of executive, executive teams or boards, these can move the needle in major, major, major ways. And they don't require massive ERP implementations or massive, massive, big bang projects that can be started and piloted quite quickly and easily, but they can develop like unusually huge ROI if, if done appropriately.   Mitch: (11:29) And let's talk strategy a little bit here. We've mentioned data and analytics strategy a couple of times. what's actually included in this strategy? Can you walk us through what the process looks like of creating a data and analytic strategy?   Jason: (11:43) Yeah, so, my approach, again, it depends on where company is at in their life cycle. You know, are they in a turnaround mode? Is it a younger company looking for growth? Most of the companies that I have been in have been more mature organization. So I will preface it by saying that I approach it from that lens. But many of the times the companies I've been a part of in most companies, I think have strategic goals related to, revenue, goal, revenue, growth, EBITDA growth, market share game, things like that. So as we're looking at this, I tend to look at it as what are those projects that have probably very, or what of those areas that have low analytical sophistication have significant upside in terms of we can get up the analytics curve quickly. What is, what is going to be those projects that are most likely to get people excited and show the potential of data and analytics, and then most importantly, which projects are most likely to actually physically move the financial needle either directly or indirectly. And I'll give you some examples. One of my favorites, to go after is, sales analytics along with pricing analytics, because these two are extremely closely related. Pricing analytics is something that can directly impact, you know, revenue and EBITDA growth. It's the most powerful profit lever we have, but there's complexity that goes into that as you know, sales incentive plans, comp plans, all these different factors go into effectively deploying a price increase in being successful in that price increase without shedding business. So that one introduces a very significant human as most analytics projects do. We don't want, we don't for the sake of time, we're not going to dig into that, but that's a very significant it's actually probably the most significant challenge in an analytics initiative is, is people sign it the change in the culture related to it. But focusing on the projects themselves right now, the sales analytics is one that I personally always start with. Always, always, always because I found time and time again, that if you can help revenue drivers do better and do their jobs better with less work, everybody benefits from that. So, you know, I'll give you an example. One organization that I went into to start up an analytics capability, sales reps are spending five hours a week putting together various types of report, either for their customers or preparing for meetings or whatever it could be. As we look at that, we're like, wow, we have 80 reps. So, you know, that's a lot of time every single week putting into a no value add activity for a sales rep, right? If your sales rep and you're creating reports thats opportunity costs that you're not out selling. So it was like, okay, well, if you have revenue growth goals and market share growth goals, you're going to have to sell more, sell more, requires more prospect, but there's a finite amount of time. So if one of our objectives is to sell more, what if we could put together this analytics platform to free up the time so that sales reps aren't putting together reports anymore. We're automatically delivering standardized content to them on a regular basis that they can deploy to their customers are used for internal reporting purposes. We create that standard. Not only that a lot of times there'll be errors through no fault of their own, maybe a filter's wrong and a pivot, or, you know, whatever could be. There's a variety of situations. But what we're doing is we're taking  that time and this was one of these things that the five hours a week as an illustration happens every single week, let's say, it doesn't go away. And it probably gets worse during strategic planning cycles and your operating plans, the budgets, all that stuff. So what we're doing is you're taking every single week, then that fictional five hours and you're reallocating it to selling, which should help you hit your goals of more sales growth, more revenue, more revenue, whatever it may be. So that's just one example of how it can be used as a tool to free people up to do the things that you hired them to do, right? You hired a sales team to sell, you know, whether it's farmers or hunters, whatever it may be. You hired them to sell, not do reports. And then, you know, by creating the standardized perspective around the numbers and the views that you take, everybody starts to speak the same language and they understand more intuitively what the other party is doing, because everybody's looking at the same thing. And this is one of, this is an example of one of those that sounds extremely simple and common sense, and it is, but I've observed it's remarkably rare  in a lot of organizations.   Mitch: (16:36) Yeah. You know, that makes total sense once again, and I'm going to keep this conversation moving forward here one more step. We looked at the analytics strategy from, you know, you mentioned different departments, right? The different functions of a business, but how did these different strategies ultimately drive the overall business strategy for the organization then?   Jason: (16:55) Sure. Great, great question. So this is one of those where, you know, let's, let's take a fictional organization and again, they have the, the goal of revenue growth. Okay. So now what happens is by having kind of the standardized framework, there's this understanding that you've got this team quarterbacking, this effort right.  In my mind, that's the benefit of having an analytics team or an organization within, or I'm sorry, a group within the organization that is responsible for quarterbacking these efforts, because what they can do then is they can take care of a lot of the stuff, right? Some, some organizations try it out and they put the analytics function in IT. frequently though, at least in the people that I've talked to in my experience, that's when that runs into a hurdle very quickly, because so much communication across the organization in coordination or coordination across your organization has to happen that this team, it really has to be involved in all components of the business, right? Again, using the manufacturing example, if you've got a revenue growth goal that has a sales management team, a management team, internals sales, incentive plans, are you comping people based on revenue, profitability, whatever it is, it takes coordination on that front. On the sales side, it gets people to understand their comp plans and track performance against those goals. If you're men, if you're manufacturing something, it takes coordination with operations to make sure you've got the capacity to make the stuff that you're selling right. With finance, itt gets, it comes into coordinating with finance. You understand, along with operations and others, this is the product mix that we're going to bring to the table. This is the margin profile of all these different pieces that come together, but that, that piece of working together is really what gives the analytical power. You know, it gives it all because that coordination is where it's getting everybody on the same page to march together to address these key strategic agendas. You know, in this example, revenue growth, it takes a lot to get everybody on the same page, and in my mind, data and analytics creates a common language, a common view, a common framework and approach for identifying opportunities, executing against those and tracking success, but it's really, again, I get back to the point of having that one group that is responsible for quarterbacking that is so massively important because if you do not have that, then what you have is, well, you're taking care of this well you're taking care of this, welll you’re taking care of this. Nobody's responsible for it. As a result, nothing gets done, and then your analytics initiatives, they get a bad name. Nobody's nobody, no individual entities fault, but they've got competing priorities. So if you have that entity that is responsible for driving the strategic agenda through analytics, in conjunction with everybody else, I think you've got a winning formula.   Mitch: (19:54) All right. So I'm going to jump ahead into our last question here for our conversation, and this really is kind of what prompted, you know, ultimately getting together on this call and, and having this conversation here. You know, we talked about the different strategies and what that means. So how does the marriage of these strategies ultimately mitigate organizational risks and really, you know, enhance the opportunity for the organization to succeed?   Jason: (20:19) This depends on the individual entity, but, I'll give you a one example, using pricing, right. So from a risk perspective, you know, there's a lot of dry powder on the M&A front, sit on the sidelines. Industry consolidation is extremely common across a number of industries, and it's going to probably, as you get more distressed businesses coming forward, it's probably going to be even more. Now, one of the things, especially for larger companies as they're acquiring, is to be cognizant of the pricing exposure. So let's take an example. Let's take customer X is let's call it Walmart. You're selling a widget to Walmart for a dollar. And let's say that there is a customer that Walmart just acquired that you're selling to for that same widget for 90 cents. Now that little company that Walmart just acquired buys one, 1000th of the volume that they've got, but now Walmart buys and says, Hey, wait, you're giving this company a 10 cent better price than us.You know what, we want that price. So now as you're looking at, you have legitimate pricing, exposure, risk, to the tune of ungodly sums of money, due to poor price management, right? And I use the pricing one just because I think that that's extremely common. If you sell something, you have pricing. And while that exact example, it could be unique to manufacturing, I'm sure there's some lesson in there that could be teased out to other industries, but the idea is, is that risk mitigation, there's, there's that type of risk mitigation where you've got an kind of exposure due to process controller or whatever it may be. But it's also that when you're marching into a project, by going through the due diligence, using an analytical framework and data, right, gut feel is very valuable, but gut feels even more valuable. If you supplement it with data and analytics. You can have a better understanding of the risk profile associated with a particular project, then maybe you would, if you didn't do that, and I'll give another example using pricing again, is that, you know, price increases typically are met with fear people, fear that business is going to be put at risk. whatever it may be I'm in, this is a real example that I've done numerous times in my past job. With eCommerce channel becoming more and more prevalent, you know, that's a good thing, but it also brings pricing transparency. So let's say you're going to go do a price increase and you sell the widget for a $100 and you're going to increase it to $120. Let's say again for illustrative purposes. Now you've got a 20% price increase. That's, that is scary. If I'm a sales rep, I'm looking at that petrified that I am virtually guaranteed to lose that business. So now what if we can use analytics to mine our quote data, and also web scraped pricing from, you know, e-commerce sites, our main competitors, or whoever's selling these things. And then you learn through these pricing analytics, using data, you've already got an sourcing, external data that the market will actually support a price of $150, that your nearest competitor for an equivalent product is selling it at 150. You know, all of a sudden at one 20 doesn't look nearly as risky. So while you haven't technically mitigated risk, per se, you've mitigated the perception of risk in the mind of the person that is responsible for selling that price increase. That's the one thing I've learned is that if somebody who doesn't believe that a price increase is justified or that they can sell it, they have an extremely difficult time selling that. So that's an example, those are two examples of how analytics can help mitigate different types of risk, both real and perceived risk.   Closing: (24:22) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Sandhya Sriram: https://www.linkedin.com/in/sandhyasriram2005/FULL EPISODE TRANSCRIPT:Mitch: (00:05) Welcome back to Count Me In,  IMA's podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong and I'm here to bring you episode 83 of our series. With most finance professionals looking to make sense of the current economic climate, my cohost Rouba Zeidan speaks with Sandhya Sriram to find out more about where certain priorities lie in business. In this episode, Sandhya shares her expertise on strategic planning during a pandemic and how professionals can best balance organizational priorities while managing their teams, particularly remotely. With so much changing in business on a regular basis, it's important to strategize, prioritize, and stay motivated. So now, let's keep listening for some practical insights on how to do just that. Rouba: (00:57) So let, let's get right into it with, with all companies around the world, migrating to remote work, more specifically work from home, major compromises that have to be made that's ensure that business continuity is done under extremely limited data security circumstances. So that being the case of staff connecting from home, what are some of the best practices you have identified within your practice to protect company data? Sandhya : (01:26) So, I think there are different aspects of remote working. One is how do you secure access to your network when people are connecting remotely? How do you secure access? Now, both of them is not a COVID thing, it was existing pre-COVID as well. But what has really changed is the scale. . Now I am for a minute, not talking about knowledge workers who work with sensitive data, so where they have to be, have to have restricted physical access, you know. Some of these KPOs where people can't take their mobile cant take pictures because they deal with  really sensitive stuff. Now I'm not talking about that, I'm talking about operations in general. I think the new aspect of remote working, which was also there before, but has significantly amplified, is who else can potentially access your data. So everyone is working from everywhere. So your employee could be in a PG. The person in the adjacent room or the adjacent bed, as she or he can afford may have access to the phone calls that your employee makes. Maybe they have access to the data that he or she is viewing, and therefore the level of what can be compromised is what is maybe worrying companies or what they're faced with. Now under normal circumstances, physical security used to give that extra layer of comforting. Yes, it's all within my office. But now what most companies are doing is that they've heightened the security checks, they perform. A lot of companies are doing self testing, vulnerability testing, where they are creating like a Trojan. They are creating circumstances of compromise and they're trying to affect their systems themselves to see where the system can be compromised. They're also heightening the, governance or the control that they have on the data leakage tools that they have deployed. So like you are aware most devices, most laptops, desktops have data leakage tools, depending on the nature or the sensitivity of the work that you do. For example, some companies do not allow say pen drive or any drive to be attached to the laptop. Some companies do not allow, from your phone to be able to, share data into a WhatsApp or your Gmail. Some companies do not allow upload into public server. So they're are a lot of data leakage techniques that exist, and what companies have started doing is to start monitoring the noise that comes out of this, these data leakage tools, because these are continuously looking at data, that's passing through the network and are continuously flagging alerts, saying these are the type of activities that are happening with the data. So they have strengthened the monitoring of these alerts that go. But this is a evolution. You know, there are a lot of tools that are there, deployment and enhancement will be to what people specifically need, but they have to build more tools as well. So for example, what prevents me working from home, taking a picture, no matter what security you put on my laptop, I can still take a picture from my mobile ofmy laptop screen. And I can still, you know, compromise a particular data element. And therefore then companies are looking at how do I look what activities happening on the camera. Now, when companies start looking at your camera, then are they breaching your privacy? Then that becomes the next question. So there is a evolution also that is happening in this space on where companies will draw a line, and that line  will be dependent on what level of security they need from their operations. But if you ask me personally, it is a problem that will solve. It's not an answer. It's not, for example, if you ask me today saying when will economies recover? You know, I don't think that is an answer to that problem yet today, but this is a problem that will solve. People are solving it as we speak. They will enhance and upgrade their solutions to what their needs are, and they will figure answers. Now, some answers may come at a price like compromise of personal, of privacy or, you know, enhanced monitoring. Some answers may come simply with y like more costs, you know, utilization of better tools, and therefore there may be a cost impact of that, but answers will  come Rouba: (06:30) It's ongoing. As you said, that's, by the minute, there are ongoing developments that are unfolding, changes in decision making amid this pandemic. What are some of the top priorities that organizations need to consider in your view and what are some of the measures that they can take to manage them? Sandhya : (06:50) So, first really, first priority of organizations is to ensure safety of the people. Now, I'm not saying that, you know, everyone should continue to work from home, because in some cases  for certain business outcomes, certain people have to come out of their homes, but we need to find that balance. And more importantly, organizations need to make the whatever will be the working environment for the employee, whether it is in home or outside their homes, safe so that they can perform their roles in an effective way. That's the first priority for any organization, and especially in countries like India, where, the number of cases have significantly increased. It's extremely important for companies to ensure safety of their employees. The second priority, according to me is to have an Eagle eye on cash. Now this is the time where revenue profits, all the 20,000 different dashboards that people make are subservient to the cash that the company has in its bank account. If the company is not going to be able to pay its bills in the next quarter, then it's going to be very difficult for companies to find way forward on the business. So immediate action is how do they conserve cash? How do they create adequate measures to keep bringing cash into their bank account? And that means they have to continuously assess how they can build resilience and sustenance in the way they work. The third one for me is adaptability. You know, there are many, many that are seeing significant downturn, but there are pockets that are opening up. We saw Lam making face masks, you know.  There is a saying that says that only the grass that can bend with the wind can sustain the force of the wind. You know, so there is a burning need today for companies than ever before to be adaptable to what is relevant in today’s climate. andHow they can make them sense have a piece of the small pie that is available. The last for me, there are many, but like these are my top four. So the last and not the least is the stress in the system. People are under tremendous stress. You know, many people are experiencing, pay cuts they're experiencing no variable pays. They're experiencing job losses in their family extended family. So therefore people are going to be under stress, not just from a work point of view, but also from a personal context. This is, yes, this is where the, you know, the integrity framework of the organization, the value systems of the organization, get tested. And this is where leaders of organizations have to stand tall, what their values and reinforce the same every minute they talk to their people. You know. keep  their  ears strongly to the ground so they can sense what people are going through and how they can help them and be able to maintain the integrity borders of the organization infact. So these are, according to me, the four top priorities, which organizations should look at. Rouba: (10:16) Very valid concerns, actually some great advice back to it. So would this entire planet facing one of its most challenging blows at least, I mean, both economically and from a humanitarian standpoint, since the 1930s. h\How is that impacting your strategic planning for business continuity and what are some of the challenges that you're facing within that parameter? Sandhya : (10:39) So from that perspective, I will give a more generic view. For me, I think if I have to simplify the business continuity situation, I would say there are three pillars. The first pillar is cash. I spoke about it quite a bit earlier, and I'm not repeating myself, but the biggest challenge that most organizations are facing is cash. Now the government is trying to do a lot of things to put cash in the hands of people. but then for each country has its own complexity and for a country like India for the size scale and the disparate manner in which entrepreneurship has evolved in this country, it is, very, very, difficult for the the government to be  able to make the current country, find answers. So each company has to find their own answers for their cash needs. Now, the second one is continuity. Now say, I may be a small company that may be producing some small component in a very efficient way to a large manufacturing facility. Now that large manufacturing facility is shut because there is no deep demand for their product, the large company, they will have the capital, they have the borrowing ability, they will find other ways to redivert their capability and build something in. So for example, we saw a lot of paint companies started making sanitizers. Let's say if I was a small supplier that is supplying a certain component to the paint company, and that's where all my skills are, then I'm faced with this big challenge of how do I give myself continuity. So that's the second, I think, big, big piece. Now that then leads me to the third piece, which is capability. Now, then how do I have the agility to create something that is relevant in today's context? And so how do I pivot myself,  re-divert, my resources, relook at my ability and create something that can bring cash, that can give me continuity and that can build on my capability. So I think these three C's is the biggest challenge and the biggest opportunity for companies in today’s times. Rouba: (13:16) How does the post COVID-19 ecosystem look like? And specifically for female professionals in finance? Sandhya :So obviously the work as we call, it will definitely change, and so many people have spoken about it. And there are companies that have said they only want to bring 25% of the people back to office. Some companies, they've gone on record and they want to shut down their office and not want to have people, working from your office locations. So a lot is changing in people's mind about how work can be delivered, and I feel that the biggest beneficiary of this change will be women. Now, if you look at the traditional reasons why, and I'm not trying to stereotype, but if you talk, if you empirically and based on a lot of research that people would have done what you see the reasons why female professionals drop out or, you know, fall back in the race is because either they are not able to continue in the location in which opportunity exists for their skills. They are not able to give the requisite amount of time that the job requires, and they are not able to network or be part of the informal clubs. You know, the, and I'm not saying women smoke, but you know, more as a common example, the smokers clubs and the, you know, the evening dinner clubs and women are not able to be part of it, and therefore they miss out on that informal networking. Now, a lot of these, when the paradigm of work changes when half your people are never going to come to work, the way people will behave in the work environment will significantly change. And therefore formal structures will become more important. Formal networks will gain equal strength. Informal networks will still be there, but there will be a value to how the formal networks operate. That's one part of it. The second part of it, of course, the most obvious one, which is location. This will give tremendous flexibility for women to work from the location which they have to be in, and still be able to work for a particular company or a particular activity, where their heart lies or, their skills lies. So that's going to make a big difference. I think another aspect is that this lockdown has significantly improved the sensitivity towards the role of the woman in the family. So if you open WhatsApp and now its  it's reduced, but a little while earlier every day, there would be one joke on how the man in the family is learning to wash vessels or how he is learning to cut onions. And, you know, there is some joke or some video, it just shows that it was so alien to people in the past that they can give a hand and help their wife. And it's not just about spouses. It's also about the children. The way children have stepped up to help their parents, and the way the concept of sharing responsibility in families have got established during the pandemic willcreate a big culture change in the way people are going to come back, and that I think will be a big benefit for women, not just in finance, but then every profession.    Rouba: (17:17) So as a leader, a female leader in the finance industry, how do you intend to use your position to disrupt the status quo going forward? And how have you been leveraging your position this far in your career to empower others and empower women as well? Sandhya : (17:36) I am a believer, that women don't need any concessions. They just need to be understood. Everyone wants to be valued for the skills that they bring to the table, and sometimes, I'm the consultants call me. And then they say, you know, they are very specific that this position has to be a diversity hire, and hence I'm calling you. And most of the time I tell them, you know, respectfully, that you please call me for who I am. Please call me for what skills I bring to the table. Don't call me because I'm a woman. So I personally feel... I am not a believer that you must do something for women specifically, but I definitely feel is that the more we create women leaders, the more we are able to allow them to express themselves, create opportunities for them to flourish,. The more they will be equally understanding and more women will come. And it's not about bringing women, but it's about bringing talent and every talent comes with their unique value. By bringing more women into the workforce, we are just creating the talent pool. We are just making the horizon of the talent pool to become much, much, much larger. So I think it's in the interest of organizations to be able to succeed in a world where creativity, adaptability, and being able to respond quickly to the changing timesis  so important. They have the right talent mix, so you are able to respond to it. So in my own selfish interest, I need to have the right talent on board. And therefore I need to find a way to make it work for women. And it's not just to, for me as a woman leader, but it's true for every leader. Now, having said that, what could people do now? One of the things that people, which we've also done, and I have always been a big proponent of that is being able to give women the choice of career, they give them the choice of timing, be able to do project engagements. So when women have to take breaks, they can stay engaged with work and be able to add value to themselves and to organizations. So there is a program called My Career, My Choice, which we run in ourorganization, where women can come and work part time at hours of their choice and can pick up projects and run. So that's one intervention, the data of course, series of interventions that my organization does, but I don't want to talk about it in this forum. For me, what is most important for every leader, not just women is to understand the value of what every talent brings to the table at one end and understand the constraints or the situations under which the talent operates. And therefore, how do we enable in a way that they're able to express themselves in the best way possible? And how do we marry the two to create value for the organization? Rouba: (20:57) I completely agree with you. And I want it to also, I mean, you seem like an amazing leader in your own, right? And I wanted to know more about under these grants, economic and humanitarian circumstances. How do you keep your team motivated? I know you're not representing your company, but if you're just to consider your small cluster, your little silo, if you like, how are you keeping them motivated? Sandhya : (21:22) So, I think it's true for me, and it's true for organizations in general. We have to be honest with our people. Now it's not an easy time for anybody and each individual in any capacity is making choices, and those choices may not be what you would have done under under normal circumstances and what you would like to do as well. But one of the most important trait that any leader has to bring to the table and which I tried to bring in my interaction in my little cluster is to be as honest as possible about the choices we make and be as honest about why we're doing what we're doing, and be honest with people in where our mind is and what we are thinking and be able to have open conversations on what are the, future, problems or difficulties we may face. There is uncertainty. Therefore, there are certain things we can do, certain things we cant do. Certain answers we have found certain answers we have not found. So keeping that open line of communication and being honest with the team is extremely important. The second aspect is to buildcollective resilience in the team. Now it's not an easy thing for the team. So I have team members that are youngsters living alone, their parents in some place, and they all worried because they can't go back to their parents. The parents are worried that they're alone here, what will happen if they fall sick, there are lots of fear that runs in people's mind. Being able to make people feel confident that whatever it is, we will stand behind them, and we will ensure that they're kept safely. It's something that builds resilience and builds confidence for you and builds confidence for your people back home, wherever you are from. So that I think is another thing that we are trying actively to stay with our people and be resilient yourself and help them be resilient  themselves in their capacity. A third aspect of, the current situation is this entire thing around how our work packets are getting delivered. And there is a very fine line that one has to draw between trust and verify, you know.  Obviously everything runs on trust, but we have to have reasonable governances reasonable reviews so that you're connected with your people. And you are able to ensure that your work packets are delivered effectively. So finding that right balance between trust and verifying. Giving the right guidance and support to people, especially when they're working remotely and therefore be able to make them effective. See, all of us don't have all the answers. We haven't found answers to some work problems which didn't exist in the past and have now come up, be able to to back your people to solve them is another aspect of keeping that conversation going. That is one more part of keeping people motivated. Now, having said that, I think it all comes down to people feeling that they belong. No as long as we as individuals. We may have a disagreement with our father. We may have fought with our sister, but at any point in time, what keeps us bonded with our family is because of the feeling of belonging to a family. We know we belong here and therefore, whatever it is  we find an answer creating that same sense of belonging with our people, making them feel that they are part of the family. Closing: (25:39) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Ben Jackson: https://www.linkedin.com/in/bmgjmba/FULL EPISODE TRANSCRIPTMitch: (00:00) Welcome back for episode 82 of Count Me In. I'm your host, Mitch Roshong, and I'm here to bring you another conversation about all things affecting the accounting and finance world. Today's guest is Ben Jackson. Ben is a Certified Coach, Speaker, teacher, and trainer, and he's also the managing partner of Ben Stu LLC, a business and leadership consulting company. Ben joined Adam to talk about the importance of internal controls, and having the proper policies in place to manage the emergence of AI and RPA in the accounting world. He addresses some of the risks presented, particularly with the recent remote work environment and how to overcome additional challenges when looking to lead the finance and accounting function. Let's go ahead and listen to their conversation now. Adam: (00:58) So with the advancements of technology, such as AI and RPA across the accounting space, can you discuss your thoughts on internal controls and the new policies and procedures that should be implemented because of these new technologies? Ben: (01:13) Well, you know, with the new technology that's going on, I don't really think that the internal controls really need to change. What I think they need is they need to be updated. See one of the things that we talk about with internal controls is who's responsible. When you have AI and you have, you know, the automatic accounting processes that are working, you need to establish who is that responsible person to make sure that they're working in the best way. So once you establish that responsibility, then you have to go back to where the next step is segregation of duties. Somebody is responsible to make sure that it's working the way it's supposed to work, as in the program. So whoever's that programmer needs to validate it. That the program is executing as expected, and then you need to add in the controller or the accountant who needs to come in and make sure that before you post an action, an action that it's reviewed. So you're really adding a couple extra steps to ensure, but you changed what goes on. So I think that you need to add some testing procedures to make sure that'd be for execution that it's there, and then also as you let these things automatically run, you need to have some spot checks and audits internally that bring forth those changes and then you'll know whether or not something is wrong. Adam: (02:51) So that makes sense. So you're saying that you don't need to change anything. It just needs to be maybe brought into the new age of what's happening around us. Cause internal controls aren't going to change, but we need to make sure that people, the right people are in place to make sure that the they're responsible for doing their duties in essence Ben: (03:10) Correct. You know, one of the things that happens is, you know, when you think about the top six things that happen with internal controls, you know, the first two are really talking about establishing the responsibility, and then segregation of duties. The next thing becomes documenting the procedure. That is a very important thing with internal controls is having a documented procedures. When you have those procedures documented, it makes it easy for somebody to take on a role. For example, if you have change in, people. People changes always make things difficult. Well, if I have AI and you know, automatic processing running, then I need to give the new person who goes and sits in those seats, what really happens and what they need to check for. So if I don't give them what the documented process is, then they're sort of stuck and they don't know that something's automated running in the background, and then they don't know how to fix it, how to look at it, if there's a problem, and who do they go and talk to. So that becomes very important, you know,  in the next step. So, you know, when you talk about AI and you talk about automated processing and letting things just run, you know, we've already established who was responsible, between a tech person and an accountant, to make sure that those two roles are responsible. We've segregated who's really responsible for whatever, and then we have that next thing, which is a documented procedures. One of the things that I like to do when I look at internal controls is to create a RACI. Who's responsible, who's accountable, who's consulted and who's informed. So that actually helps with internal controls because then you know exactly who you need to go to if something is wrong or when you noticed, things during an audit, you can go, okay, you should know who, who entered the, program for the automatic entries. Now, the problem with AI is AI is always thinking, and because it's always thinking you sort of control the parameters, that it looks at, and that control will always be a consistent review. And again, it doesn't change the fact that the internal control is there. It changes what the internal control should be. Adam: (06:12) Definitely. So do you have some examples maybe you can give of, maybe updating internal controls, or some of the things you've been talking about, some specific examples that you could share? Ben: (06:24) For updating internal controls, I recently consulted with an organization who didn't have a lot of internal controls. And, during the process, I noticed that there were open system users that had the ability to do some things that they shouldn't be doing. So we put in plan in a place where we actually created a table for what the internal control could be or should be based on their current platform. So in doing so, what you do is you sorta look at their current processes and then you assign someone in the finance group to monitor what's really going on. Because the system, the company is a small company. So a lot of people wear many hats. So locking down the system is not a great idea. The better idea is saying, okay, I know what my parameters are. How do I validate that everybody is doing things correctly? So when you do notice an error, we you bring it up to the CFO and the management team and make some decisions on what do we need to change in a process and how do we correct some things so that consistency is improved. One of the things that you do with these controls as you're growing your company, you want to make sure that they're in place so that everybody knows the rules and that it's not risked, there's no risk to the company. So in implementing this, we also identify what the potential risk is. If somebody doesn't catch it, and that becomes important for the stockholders, and when I say stockholders or the stakeholders, it's who we have to report to, because it could be on any scale of company, who you're giving these reports to. They have to know that they could be confident in the data, and that accounting is really looking at what's transactionally happening, whether through systemic processes or manual processes. Adam: (09:05) You mentioned that there are always risks involved with any internal control, knowing that the main risk is what if the internal control fails? Are there some pitfalls that people can look out for as they're looking to maybe update their internal controls or looking to make them more holistic? Ben: (09:23) Are there things that people can do to mitigate risk? Of course. One of the things that I suggest is having a quarterly review, and sort of keeping the scorecard from the review to see how many errors were caught, what were the risks? So it's like doing a risk assessment, and in doing the risk assessment and you sit there and you say, okay, did this control work? You know, how many, how many purchase orders do I have to look at? How many sales invoices would I have to look at? Do I look at bank reconciliations to ensure that cash is being recorded accurately and timely? These are some of the things that you want to make sure. So when you write down the risk, you want to be as specific and as broad as possible so that people know what to look for. And if you do a biannual review, that can be a bigger scope, where you bring in some key stakeholders. So for example, quarterly, you would review with the CFO and the controller, here are the things that happen that we caught. And then, you know, mid year and end of year, you would have a review with your management team, where you bring in your operations and your sales managers, and you sit down and say, okay, here's what we found over the quarter, and then what you hope is that by the time you get to the end of the year, a lot of those risks have been eliminated. So that this way you become comfortable with the process. Now, if you're an established company that has already had internal controls, what you tend to do is you would tend to always want to look again, and see and make sure that things are not changing and that your risks are not there. There might be new risks. So we talked about earlier, AI and automated entries, right? So since AI is constantly thinking, the risk becomes exponentially greater, because what you want to do is you want to control how that AI is thinking and what those parameters become, so there's risk in that. So, because there's an additional risk with that level, that control probably is reviewed a lot more than something else. So I would liken it to cycle count inventories, where there are controls that you look at more frequently, where, because the turns happen a lot in inventory. So those are like AI items. And so we would have a controls and those controls would be things that deal with day to day inventory postings. If they're an AI, you know, thought processes, we would think about looking at those and saying, okay, what do we need to look at in this program? What did we give the program, the ability to think, and do we need to look at those on a monthly basis? So those would be reviewed, and that would be where that control would be set. If we think about something that doesn't happen that often, and you know, that would be something like a full physical inventory. So whatever controls you would set up in place for full physical inventory, your internal controls would happen to align the same. And as you're looking at that, you're saying, okay, you know, did these controls work? And then what you want to do is you want to sit there and say for inventory, I created a list of procedures to reduce shrinkage, and in those procedures to reduce shrinkage, did they work when I did the physical inventory, because then you're looking at the variance. So if you start ed with a 10% variance, and now you're down to a 5% variance, you know, that something worked in your controls, and if 5% is your standard, then you feel good. You feel comfortable. If you want to get it down a little bit lower, then you say, okay, now we got to look at what some of those challenges were during the course of the period. And during that course of the period, you then would say, okay, here's risk, and you know, risk is sorta like a survey. You have a plus or minus error ratio, and in that you sit there and you make your determination of how deep down the rabbit hole do you go. One of the terms that some people say is the juice worth, the squeeze? And what that means is how close to perfect do I want to get? And is if 5% is close enough, let's see what happens the next time, or do I really have to do deep dives when that 5% and leave some other things on the table? Cause there could be other risk that I'm not going to pay attention to, to get this better. Adam: (15:23) You know, shifting gears a little bit because of COVID-19, a lot of companies are moving to work from home. I have been working from home and for the foreseeable future, they will be working from home or some sort of hybrid office home setup. What are the added risks and obstacles that companies face, especially the accounting team faces as everybody's in a different location? Ben: (15:44) Well, there's pros and cons to it. One of the biggest cons is communication, because you're remote having meetings is now a virtual thing and you probably have more meetings. So it makes doing a couple of things a little bit harder. As I currently work remotely, it's closing the books becomes difficult, because where you were in the office and you had a question, you can immediately go to somebody and ask that question. Now it's an IM, it's a phone call, it's an email, and you're waiting. And so timeliness becomes hard. So now you have something that you had a tighter timeline on that okay, you know, I'm waiting for somebody to respond and it depends on where they are. So it becomes a little bit more challenging. The other thing that becomes challenging is, as I said timeliness is there. So what is my timeframe? So where I could check something in an office full of people quickly, and be able to get my timelines down and have things sent out, and be able to hold meetings quickly. Now you don't have that luxury. And a lot of people are getting pulled in different directions. So your internal controls don't suffer, they become more time sensitive and communication sensitive. One of the other things that I see with COVID is  it does create better focus. So there's a pros and cons to the communication and timeliness. The con is I can't get a quick response. The pro becomes I can focus, because I don't have a lot of people in my face. So it's like that double edged sword where you think about it, and when you're in the office, you get what we call drive-bys where somebody needs something and they just pop in, and you're like in the middle of doing something and you're sitting there like, Oh man, like you just wrecked my concentration. So one of the things I've said to somebody is when somebody interrupts you, it's a least a half hour of disconnecting, which gets you unfocused. So if you take up five minutes of my time, there's another 20 minutes, to 25 minutes that I have to use to get refocused, because I could have been in the middle of something and in a thought process, and now I gotta go find it. And so what do most people do? They get up, they walk around to clear their head because this conversation just distracted them. Right? So, but working from home, you find that you can be a little bit more focused. Now we're going to flip the script a little bit with that. It depends on if you have small kids or not. Small kids could be challenging depending on what your house is like. So the focus could be a little bit different. The focus does become, I know when I need to work and I know what I need to do. So, you know, when you have to do those things you plan your time accordingly. What could also be a challenge when we go back to time is when does something get done? We talked about the family and having, you know, small kids at home. Well, if I have to take care of them for a period of time, then I'm not focused on my work, and so something that might be expected to be done by 10, 11 o'clock in the morning, sort of takes a back seat because you're coming on later, you're showing up later. So those types of things that happen from home need to be in place. As it relates to the internal controls, it's again, not really an impact to it because we already know who's doing what. Adam: (20:42) So what are some ways to overcome that time issue? Because as you mentioned, time takes a different route. Like if you have small kids, you need to take care of them, you need to feed them, you need to do different things or whatever your home situation is. How do you try to overcome that timeliness? Do the internal controls change as far as like when the things need to get done or is it like, Hey, it doesn't have to be done by 5:000 PM, you can finish it by 11:00 PM after the kids are in bed, you know, how do you overcome that challenge? Ben: (21:10) While communication is a bad thing, but communication becomes a good thing, right? So the way that I would proceed is during close process, that's when you would probably have a daily meeting, to talk about what needs to happen for the day. And it's basically like a check in, and if something needs to get done by after five o'clock, you've made the team aware and everybody sort of understands that impact. So if you're constant communication with your team, and you have a check-in daily check-in during the close, those types of things are mitigated. And those aren't really part of internal controls, but those become things that we put into place to ensure accuracy of reporting. So if I have a deadline and I understand the deadline, so in a company that I worked for, the deadline was three days. If it was in this situation where the deadlines in three days, when we had our close meeting, I would say, okay, we're going to have a daily check in to see where everybody is and know that our deadline is still three days. So who has to work later and who has to work earlier to make those changes and live up to the commitment we have to hold people accountable, and so in the control, we need to accurately state the finances. If there's something that comes up, we then have to know who who's the backup to the person who can't do it. So it's putting things into place before COVID that are still going to  be there. So if you had backups before, you're going to have backups  now , and once you have a documented procedure, it's easier for somebody to take on that, that role and at least follow the procedure, right? A lot of what you also do is you do cross training. So this way, you know, if something goes south, you have a documented procedure and somebody else can pick up the slack for that. Because if you think about it, anything could happen to somebody. So you need to have those controls in place to say the, what if scenario, somebody got sick? What if somebody went on vacation and there was a problem, you know? who could troubleshoot and who could do these things? So that's why key to 90% of everything is going to be document, document, document. Closing: (24:13) This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Andrew Royer: Facebook: https://www.facebook.com/royeraccounting/ LinkedIn: https://www.linkedin.com/company/royer-accounting/ Royer Accounting: https://www.royeraccounting.ca/Andrew's Recommended Readings: Tim Ferris, 4-Hour Work Week: https://fourhourworkweek.com/ Mike Michalowicz, Profit First: https://profitfirstbook.com/ Dave Chilton, The Wealthy Barber: http://www.wealthybarber.com/ FULL EPISODE TRANSCRIPTAdam: (00:00) Welcome back for episode 81 of Count Me In. I'm your host, Adam Larson, and I'm happy to share another conversation with you about various things affecting the accounting and finance world. Today's conversation features Andrew Royer, Founder and CEO of Royer Accounting in British Columbia, Canada. Andrew is an entrepreneur who uses the tagline, “Transform Your Business from a Cash Eating Monster to a Moneymaking Machine.” He loves working with other entrepreneurs to help them see cashflow issues and showing them how growth and profit go hand in hand. In this episode, Andrew shares a perspective on various accounting software options, and how it can enhance work productivity to ultimately lead to a more profitable business. For a further explanation on what it means to be efficient and effective in business, keep listening as we head over to the conversation now.   Mitch: (01:01) So from your experience working with accountants and clients, what are some of the advantages to utilizing a desktop accounting software?   Andrew: (01:09) Okay, well in some cases you don't really have a choice. If you're in an area that's got a slow or unstable internet connection, you're not going to be able to use an online application. Another benefit is that the, the applications, the desktop versions that are installed on your computer tend to be a lot more robust and have more features available to them. And a couple other, you just, you'll, there's a onetime cost option, which you don't get online generally, and, you have more control over the upgrades. You can decide, you know, when you're going to install it, you don't have to worry about them installing it when you're, you know, you're busy with something.   Mitch: (01:52) That makes sense. And then I guess the opposite here, the online accounting software, what are some advantages to utilizing some of that?   Andrew: (01:59) Yeah, I mean, the, the biggest advantage is that you're not tied to your computer. So a lot of the software, you can access it on your phone. Take your laptop, you sit on the beach, not that you want to be working on the beach, but, it's better than working in an office. But yeah, I mean if you get a call at home, you're able to look information up thats, and enter information when you need to. You don't have to worry about like, so the benefit of the desktop is that you, you get control over the installations, the downside, or the benefit of the online,you don't, have to worry about the installation. Somebody is doing the installations, they're backing up the software, they're installing the updates for you. It's also easy to give access to your staff. You give access to, accountants and bookkeepers, whereas on a desktop version, unless you're getting into a really expensive enterprise kind of options, it's hard to get multiple people involved. And the online makes that, you know, the interconnectedness  is very powerful. You can also make up, so the shortfall of the online, which I had mentioned before was that you have less power than the desktop, but, with the online, you can actually integrate with thousands of apps that will increase the power of the online. So there's a lot of benefits you're not closed and tied to what the desktop gives you. You can add whatever features you want.   Mitch: (03:21) So I guess a lot of it sounds like, you know, there are pros and cons to both of these, for those who are interested in, you know, looking at different software options, whether it's desktop or online, we'll start with desktop to stay consistent here. How do you go about determining which desktop software is right for you?   Andrew: (03:40) In my opinion, it's, it's largely preference. I've used.,I've used most of the different options out there, the big names anyway. So, the primary options are QuickBooks Desktop, and then the Simply Accounting or the Sage version. So those are, those are the two main competitors. There may be some advantages to one or the other based on the size of the company or the particular industry that you're in. But otherwise I find that it's mostly preference. I find more technically minded tend to prefer the Simply Accounting and, the QuickBooks, if you're just getting started, QuickBooks tends to be simpler, easier to use. So a lot of people start with that.   Mitch: (04:21) Then what are some of your options on the flip side? Like I said, what are some of the ways that you can choose the right online accounting software and what are some of those examples?   Andrew: (04:31) Yeah, I think so picking the right online software is probably a little tougher. For our firm, what we've done is we've gone just to be consistent. We've gone with QuickBooks online, just across the board for everybody. This is QuickBooks has been in the market the longest and online,aAnd so they have the most integrations with other software out there. They're, it's easier to find people that are more familiar with it and able, so it's easier to find people in, to work with it and so there's less training involved with that. And, I mean, it's not, it's not perfect. I'd like there's issues with it that drive me nuts, but it's kind of, I can say it's the worst system until you consider the alternatives. So then we look at, like Sage has started the game a little bit later. I think they were digging their claws into the desktop version and really just didn't want to let it go. And so they joined the game a little bit later and, they have a lot less integrations thanthan QuickBooks and otherwise I think between the two, it's more of a, just a preference thing. And then the last one, the one that I've been keeping my eye on a lot is XERO. So they never had a desktop version. So both QuickBooks and Sage, they were basically competing with themselves, trying to create some of the same features that they had in the desktop version. XERO didn't have that liability. So they were able to just create something from scratch, make it the way that they wanted to, with an online interface. Some of the issues that they ended up getting into with that is that, people are used to doing things a certain way with all other accounting software and they've kind of done just something completely different. The biggest benefit with XERO isit works great with the foreign exchange transactions, which can be tougher in both, you know, QuickBooks online and Sage. And really, the only reason that we haven't moved everybody over to it is it's really lacking in the Canadian sales side. So the sales tax handling, they're working on it, but, until that's done, I can't even, consider it, but we're definitely keeping our eye on that one is potentially a future leader in this industry.  Mitch: (06:50) So you've said it a few times where it really comes down to personal preference, and I assume that goes for most people who are considering any of these different options. You know, I assume it really revolves around what your ultimate goals are. And one of them I'm sure for most is overall productivity, right? Your ability to be flexible and get the job done efficiently and effectively. So how do these various software options ultimately lead to a more productive, accounting and finance team?   Andrew: (07:22) Well, I think all of these options, whether it's desktop or online, they're, I mean, what they're doing is they're computerizing a process that was originally, you know, journals and pens and beyond that, I really think like the advantages for the productivity start, you start to see that a lot more in, on the online world where you're able to have all of those sort of integrations. And that's really, and that's the main reason that we went with QuickBooks online is because of all of the other integrations that it has and the automations that we're able to do with it. So that productivity is, when you, you can audit, obviously the first thing you want to do is try and see what tasks that you can just get rid of, and then once you've gotten rid of the tasks, you try and automate as much as you can. And so this software allows you to do that, which will free up a lot of your time. Also if you're, if you're using a whole bunch of different systems, if you can get them to communicate and integrate with one another, then you can get rid of some of those redundancies, that human error entering it in multiple systems, and I guess the, ultimately goal is that you're trying to get some solid financials as quickly as possible, but the faster you get those financial sitting in front of you, the faster that you can review those numbers and see where you need to make changes, you can, you know, shift your business, you know, especially say something, you know, catastrophic, like COVID happens, it gives you that information faster. So can see maybe where your expenses have gotten out of control and where you need to make some cuts.   Mitch: (09:00) Yeah. I mean, that leads right into my next question. You kind of just hit on it there, but, you know, with this productivity and additional available time, I'm sure everyone else's goal is, you know, you want to make a profit. So from the firm side of things, how does all of this ultimately lead to a more profitable business?   Andrew: (09:19) Yeah, I mean, so you, you get lower costs, you should less staff time, potentially delaying hiring staff, so you can reduce some costs by getting, you know, more of the stuff automated and more efficient. And so one person can do more. And it frees up some of your time to do things like looking at cashflow management. So you can figure out how you're going to survive over the next three, six months, you know, three to six months or a year and yeah, and you get that information in front of you faster and just be able to make better decisions, be able to capitalize on opportunities as they arise and try and mitigate some of those risks as you see them.   Mitch: (10:00) Ultimately, you have this profitable business now, you know, you're working productively. Again from the firm side, what is your definition of an efficient and effective business? You know, obviously we're aiming for these profitable goals, but what does that look like on the daily basis or weekly, monthly, some of the key indicators of a business that's running well.   Andrew: (10:25) Yeah, I mean, we need to do is we need to, communicate with our clients on a weekly basis and make sure that we're getting the information from them and make sure that we're giving them, you know, the information that they need to be able to make their decisions on. Generally what we do is on a monthly basis, we produce reports for our clients, and I think what's important is that we have to look at those numbers frequently. This is why I prefer, like in our business, we do primarily, we do both tax, we do tax and bookkeeping, but our focus has been on the bookkeeping cause we want to be involved on the client on that on a month to month basis. And the key is to get to being efficient and to being effective, for ourselves and to help our clients to be efficient and effective is to, we need to be able to not only provide those numbers, but be able to give feedback, give advice on those numbers, to see where changes need to be made and start to indicate where some problems might be coming up. And the soft the software is necessary. There's no way that we would be able to do what we do without the software that allows us to essentially be a fairly smaller companies that can't afford to hire, you know full accounting teams internally. It allows them to hire a company like ourselves that, can advise them with, you know, much we're able to do this at a much with a much smaller staff and with a much lower price than it would be to hire somebody internally.   Mitch: (12:03) Well, my last question for you today, I know you have various areas of expertise and, you know, your accounting background is pretty diverse into where you got today with your entrepreneurial mindset. So I'm just curious about your perspective on how you see, accounting evolving even more in the future. You know, you talked about going from desktop to online. There's a lot of automation, a lot of talk about different technology in your, in your mind, what do you think may be next for the industry?   Andrew: (12:41) Well, I still think a lot of the technology that's out there and I know there's a big concern that it's going to, I've heard talk of it, replacing accountants and bookkeepers, and I, don't see that happening anytime soon. But I do see that there's going to be a surge. Like there's going to be a growth in the software industry. This automation is going to become a big thing. I think people that are remaining on, the desktop versions are going to suffer in the long run. I think the online world is going to continue to grow, become a lot more powerful and I think, accountants and bookkeepers are just going to have to, are going to have to get on board that and take advantage of that, and I think what it'll do is it'll allow us to do, be able to offer a lot more with a lot less staff and resources, which I think is going to be important because we're not where we're going to be seeing, a big exit of the accounting professionals. And so it's going to be a lot less of us required to do the same amount, if not more work.   Closing: (13:42) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Michael High:linkedin.com/in/michaelhigh Michael High in the Media:https://www.afponline.org/ideas-inspiration/topics/articles/Details/bridging-the-gap-between-it-and-finance/https://www.afponline.org/ideas-inspiration/topics/articles/Details/the-power-of-diversity-in-finance/?utm_source=linkedin&utm_medium=social_media&utm_campaign=May20_week2 Michael High Articles:https://www.afponline.org/ideas-inspiration/discussions/afp-conversations-podcast/Details/shell-oil's-michael-high-on-the-challenge-of-bringing-fp-a-to-deepwater-drillinghttps://www.linkedin.com/pulse/dont-vacuum-cleaner-youll-replaced-one-michael-high%2F/https://www.linkedin.com/pulse/senior-management-do-your-best-leaders-have-ax-grind-michael-l-high/FULL EPISODE TRANSCRIPTAdam: (00:05) Welcome back for episode 80 of Count Me In I'm your host, Adam Larson, and this is IMA's podcast about all things affecting the accounting and finance world. Today's episode features Shell's, Deep Water Gulf of Mexico Business Unit CFO, Michael High. Mike is passionate about thought and people leadership, diversity and inclusiveness, digital transformation and personal development. In his upcoming conversation you have with my cohost Mitch, Mike highlights the different states of going digital, finance's role in business transformation, and what it takes to effectively lead a business transformation. Thanks for joining us, and we hope you enjoy the episode.   Mitch: (00:49) For a little background and context and this conversation, can you please tell us what finance digitalization is?   Michael: (00:57) Thanks for the question. So in terms of what the finance digitalization is to me, I like to start a bit with a kind of vocabulary for me, at least a lesson that I learned on this journey, and there are three terms that seem to get thrown out together at the same time, and sometimes try to mean the same thing, but I think they have a bit distinct meaning. So the first one for me is just this idea of digitization, which I think is something we've experienced mostly through our lifetime. This is that switch from analog to digital, where we went from filling out paper forms to doing so electronically. And so for some people, when they hear digitalization or even finance digitization, they're, they're thinking about that element of it. And for me, that's at a minimum step one, and then most places were far beyond it, but there are still pockets where actually this is an important part of digital transformation. The second one is digitalization, which for me is kind of a second phase to that. And this is where we're for me thinking about the current ways that we do work and how can we make those current ways and this current business models more productive or perhaps simpler, or make it a little bit easier to collaborate, but it's, by and large within the paradigm of the existing way that work is done. And the third phase for me is this concept of digital transformation, which is actually where you're opening up entirely new ways of doing business, perhaps even new business models, new ways to even approach the market and fundamentally different ways of working. And so, for me, that's where the most value ultimately lies is in that, and I think it's also where you get beyond things like just looking at the IT cost or even the IT side of the equation to actually looking more fundamentally at a minimum data, but also process and also business models.   Mitch: (02:39) So with all those considerations, what is the role of finance in the bigger business transformation for an organization?  Michael: (02:48) I think are some of our foundational skills, even around understanding value management, understanding cost management, these, these core skills actually come to the forefront. And it's really important that we help our business colleagues let's say frame the decision appropriately and evaluate it  appropriately. I think it's kind of easy, especially if you're thinking about digital transformation, just simply from that digitization or even digitalization perspective, the kind of first and second steps that are referred to that, you only think about the first order cost effects of this. And I often have found myself in conversations where it's challenged by, well, Excel is free, so why would I possibly spend more money to do something? And of course, when it's framed that way, it is hard to actually talk your way out of that argument. But when you actually step back and say, actually what we're after here is a fundamentally different way of doing business. You start to realize that the cost side of the equation is actually only a very small part of it. The value side of it actually is an enormous part of it, and you have to actually be thinking about things like at a minimum total cost of ownership, of an overall suite of technology, thatpeople productivity in terms of, you know, if you've got the hidden factory of work that is caused by late nights and shuffling between spreadsheets, that ultimately takes a direct toll on people, but also direct toll on your cost, employee engagement, the value of improved decision making these become actually important parts of the frame on this to actually make sure you're making a good long term and sustainable decision for your organization.   Mitch: (04:22) Well, that's just it right there. You know, you just said sustainability. Once you have this fundamental difference in the way you look at your business and you've gone through this transformation, you know, what is the impact on your forecasting and your strategic business planning going forward?   Michael: (04:41) Yeah. So I think maybe to take, take forecasting as a first part, and then I'll talk maybe wider around. business transformation. On the forecasting front, I think there, there's a recognition that, of course there's no crystal ball that'll tell you a precise answer about the future, and unfortunately, when many of us are trained to try to get as precise of an answer as possible about the past, and there probably are facts that we can ultimately uncover if we just dig deeper and deeper and deeper. Applying that mindset to a forward looking forecast, actually I think undermines the general quality of it, and, you know, there's a, there's an adage around, you're better to be approximately right than precisely wrong. And I think that is a, that is a transition that those of us who've been on this kind of a journey in accounting and finance have to ultimately make as recognizing, letting go of some of that precision might be the key to finding that approximately right  view of the future. And I think one of the things that digital transformation enables related to that is, is the way I'd almost describe it as it's so much effort to just find one number. So if that's one business plan CFO number at the end of the day. When our company, at least the process of getting to that can take months, if not an entire year to just get the one number., Whereas, you know, digital transformation potentially you to find three or four approximately right numbers across a range and across a set of scenarios that in sensitivities that allows you to actually recognize, okay, the outcome could be this, this or this,this and if I want to use a number four, for example, performance management and target setting, I may choose one, which is a bit more aggressive in the range to be able to drive performance. And at the same time, if I'm going to use a number to try to take the best guess of what I think is going to happen, I'm going to take something that's probably in the middle of the range. And if actually I'm going to give a commitment to the external market, something that the market is going to hold me against to see whether I deliver, I may actually take a more conservative number in the range. And I think digital transformation allows us to with the same amount of effort, or even less be able to generate three or four numbers in the time that it actually take us to generate one. In terms of wider business transformation, you know, one of the phrases I've kind of find myself referring back to is this idea of putting the business back in business planning. And one of the things I think that's happened with having this process, which is so arduous, and so difficult is that basically it ends up being a finance and an IT process mainly because finance kind of knows that knows the numbers and knows the details. IT knows how to use the technology and the systems that are very complex and difficult. And it leaves very little room actually for the business itself, ultimately should be the end owner of the numbers and the forecast to be able to spend a lot of time just soaking and thinking and reflecting on it. You know, if 99% of your process is just getting to that one number, you leave 1% for the business to actually sit and reflect upon it. You got to guess that's not leading to great business outcomes. So I think part of this transformation will be changing the portion of time between call it the IT and the finance part of it, actually allowing much more of the process to be driven and owned by our business counterparts as well.   Mitch: (07:50) So there are certainly a number of considerations and, you know, you've mentioned quite a few different benefits, great value to be realized through this process, but I'm sure it's not just a matter of saying, okay, we're going to do this right. So, can you name a few, maybe some of the common challenges that you have come across or are aware of and, you know, things for our listeners to consider as far as, potential pitfalls as they look for this transformation?   Michael: (08:16) Indeed, quite a bit, and I would actually say a good sign of that you're going about this in the right way, is that you're hopefully coming across pitfalls quite frequently. And what I mean by that, it's a little bit, this fail fast adage, but you know, traditionally our approach around technology implementation has followed a very waterfall like project management approach, which is, you know, you spend quite a bit of time defining requirements and then in a sequence set of steps, perhaps lasting over a course of years, you hand off from one team to the next, until an end product is produced that the original customer may still not even be around, gets the output. And it's a comparison against those original requirements from years before. And it hasn't been a lot of customer involvement on the way, and so I think, so one of the outages would be if you're finding pitfalls, it means you're probably failing fast enough to actually go about this in the right way. So a couple of those things that we learned as we kind of shifted from a waterfall mindset to an agile mindset around project management of digital projects. One is that is, your ecosystem in and around the project has to also be agile or it actually can undermine the overall agile effort. And what I'm meaning by that is if, for example, you have a scrum team who’s come together, they're meeting daily, they're, we have a product owner, they're finding requirements, they're testing things with their customer on and on and on, but things like either IT security, especially if you're moving into the cloud or contracting and procurement in terms of making a contract with the IT service provider, a SAS provider that you want, if they are not thinking agile, you can still have a very, very long process and series of steps there that actually slows down the overall effort of the project and makes the whole thing effectively not be agile. I think the second one in that is time. One of the learnings there is, you know, taking again, this waterfall, agile comparison is like to think of an agile project is takes one third of the time of a waterfall project, but fit, into, half of the effort or half of the effort fitting into that one third of the time. So when I'm going out there is the intensity of the effort actually is higher. It just happens to calendar day, days wise, last a lot less. And so, if you're used to the idea of, I'm just going to define my requirements hand ut off to it and the consultants in two years come back and I don't have to do a lot between now and then, you're not going to have a great project. You have to recognize that as the stakeholder of the project, you actually have to invest more time than you did before you just get the benefit of getting the output a lot faster. With that, of course, as a commitment around resources. So the first agile project I did, I said, okay, I've got somebody on my team. I'm going to dedicate them half of their time they're going to focus on this project. And very quickly I realized actually half was not enough. I needed to actually put three people into the project and most of them full time, and we did get the output and a third of the time, but it took investing two to three times the, the resources to do it. Maybe two others I'll just leave you with. I think another one is that, you know, not everyone has your interest at heart ,and of course there's internal politics that may have that and the case. And you can run into that. And I'm thinking a little more externally in this case. So obviously a technology provider or salesperson has in their own interest, the idea of selling their product. Now, some companies are better at partnering with you to really try to understand what your needs are and really try to solve your problem as opposed to just selling you something that doesn't work. But there is that risk. The one that surprised me a little bit was the kind of consulting ecosystem in and around these projects that, you know, these companies make money a certain, in some cases it's been by implementing certain technologies and working with certain technology providers and they know that they make more money off of that than other technologies that may not be familiar with. And that you can run into a little bit of a fiduciary issue, I think around that. And you have to recognize that you can't just rely even on third party advisors who in theory are supposed to be agnostic, to be truly agnostic and have your interest at heart. And so, you know, being a bit open-minded to the fact that you're going to have to do your own research and advocate for yourself, and can't just trust every little bit of advice that you get from folks, because again, there may be driven by different interests. And then the last piece I think, is a debate around what it really means to move to a market standard or off the shelf technology.  And being in the energy industry, you know, we like probably many industries, we love to think of ourselves as different than other industries. And therefore, sometimes when we think about what's the standard technology to choose off the shelf, we already narrowed the frame on it by looking at technologies that are available to our competitors and they're using. So if it's, you know, what another major oil and gas company would be using, we would say, aha, that must be the market standard. Well, the reality is things like planning and forecasting are quite industry agnostic. And so I think a better way to frame that question is to say, you know, given the 80% of our process is industry agnostic, what is the multi-industry market standard? So I'd rather look at things that 40 or 50 industries are using, because the other reality is even in a company like ours is an integrated energy company. We have multiple industries represented in our own company, and we've sometimes found ourselves by choosing just oil and gas market standard technologies that are not even usable and other parts of our own company. And so I think reframing that is one of the learnings that we have on the journey as well.   Mitch: (13:46) Your experiences are really interesting and the examples you've been able to share have been great. So, I mean, it's, it's obvious you have a great leadership in moving these transformations, and you know, leadership is certainly an area of interest of mine. So when it comes to you know, pointing out a leader if you're looking to identify somebody who would be good at leading a business transformation, who does that look like to you and what kind of skills or attributes do you think a one individual needs if they want to bring this to their organization?   Michael: (14:19) Thank you. Thank you for the question. I think, for me it  first and foremost starts with a learning mindset and there's a lot of discussion around this new kind of idea between fixed and learning mindsets that even underpins our current discussion, our company around safety performance, and you've got to switch to a world where you recognize you don't know everything and that's okay. And you gotta be willing to admit mistakes and learn from them and go on and recognize that, when someone else knows something, that's an opportunity to learn from them, not something that is competition. And so I think it starts there. And, you know, if I even think about my own journey on this, you know, two, three years ago, I honestly did not know all that much about digital transformation. It was a bit of a joke in my family, which was, you know, when you come to the dinner table, I was the least competent from a technology perspective. You know, I had a brother who worked in IT, a dad who worked in IT and so I was a bit of the black sheep when it came to technology and adoption. And so, you know, some of this is the humility of recognizing you don't know it, but then a curiosity and going after and learning as that's probably the second piece. I think the third one then would be persistence. you know, this is not an easy thing to advocate for, again, back to this idea of first order effects on cost versus second and third order effects. You know, when you're, especially in an economic environment like this advocating for spending money on something, especially from the lens of finance, that's a difficult sale and especially where most of the value is in things it's a little bit harder to measure, everything from, again, the user experience and employee engagement through to total cost to ownership. You know, these aren't as easy to measure as just looking up the contract price of a piece of software. And so, you know, kind of staying with the struggle and going after it and persisting and staying on message, sometimes in the case for a year or so. I kind of find this as an exponential journey, not a linear one. And so, the payoff has been massive, but it only came in the last 10% of the timeline, not in the first 90%. And then I think two other things that come to mind is, having a strategic view. And what I mean by that is, again, back to this idea, if I'm just trying to solve a problem for my immediate business line, I'm not necessarily solving it in a way that will help my overall company. and again, if I'm only looking at my industry and not looking at other industries, I'm potentially, you know, sub-optimizing on an industry specific solution versus a bigger one. And so I think having that bigger picture in mind, the other part of bigger picture in mind could even be cross-functional. Because I tend to believe that most of the value in companies is actually lost between interfaces, whether it's interfaces between departments or interfaces between businesses. I've seen it a lot in the space between functions and in the flip side of it is I think back all by proudest achievements, and you know, since I've been working in my company for almost 15 years now, they've almost all come when I partnered with another function. So whether that's what HR or it or legal, or, or many other functions that that combination of functions and the different perspectives can be very valuable. And so, that also is part of the strategic view of recognizing this is a cross functional thing to go after. And then maybe the last one is, you know, putting your skin in the game. And so that ultimately comes down to this willingness to commit resources and time. And so if I'm not willing to have my team reprioritize what it's working on and go from half a person to those three people working on a project to make sure the right knowledge was in the project to get it delivered on time, that I'm not drinking my own Kool-Aid right.   Mitch: (17:57) So I'm actually going to take a step back, to the beginning of the conversation you even said, you know, nobody has a crystal ball, nobody can really predict the future, but you've seen your organization change. You realized you yourself needed to change and all that goes back to learning. So with this ongoing,need to learn and the new skills that are needed in today's business environment, what do you think individuals or organizations, you know, what should they be working on to best prepare themselves for the future here?   Michael: (18:30) I think, you know, one of the things that will prepare us best for the future, and I know I have said it a few times, but probably good to continue to emphasize it is, you know, we have to pivot as individuals from being the knowers and the people with the answers to the people with the best questions. And that for me, again, is underpinned by this idea of a learner mindset. You know, the reality is whatever skills are going to be needed to navigate us through the future. We probably don't have all of them right now and may not have any of them in some, in some cases. And I think just what we've all experienced in the last six months should show us that. You know, maybe, just an interesting anecdote, I'll share as well. Cause I think the second one we need to do is we clearly need to have a more diverse and more inclusive function as finance. And I think it doesn't even just take the external events that have been occurring with George Floyd and others too, to acknowledge that. But I even reflect on something very close to home. Which is just strictly about our capability as finance and around risk management. I attended a finance conference back in October and, and in that I attended a workshop that was on scenario planning and risk management. And there were 140 people in the audience representing perhaps 30 to 40 different industries. And so as part of the talk, the speaker had us list the top five risks that our business we thought was going to encounter in the coming years. And so if you take an audience of 140 and multiply that times, the five risks you come up with 700 potential risks that could be identified again across 30 or 40 industries. And what was fascinating was, you know, this was an October and out of 700 potential risks identified cutting across these industries. There was not a single person who identified a pandemic as one of the primary risks that their business was going to be exposed to. And one of my reflections and the linkage to diversity and inclusiveness and the ability to forecast as a function and why we need to change is, you know, there were clearly people on this planet at that time who knew that a pandemic was a significant risk that we needed to be thinking and planning for. And so what is it about our function that, you know, in that cross section of 140 people, we did not manage to have anyone who was thinking in that way. And if there's anything that kind of sells the point me on the value of diversity, it's this ability to recognize risk and understand from different life experiences and perspectives and education and training and all these things that there are many different outcomes that the world could be experiencing and things that we're exposed to and being able to then link it to inclusion, which has maybe there are people who do see it, but they don't feel like they can speak up about it. You know, creating an environment where they can is going to be a really important part of our function as we go forward.   Closing: (21:16) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Rob Mars: https://www.linkedin.com/in/rob-mars-3738402/CMA Certification Overview: https://www.imanet.org/cma-certificationIMA's Website: https://www.imanet.org/FULL EPISODE TRANSCRIPTAdam: (00:00) Welcome back to Count Me In. IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson, and today I'm sharing with you another bonus episode in our series. As hopefully you've recently heard on our podcast IMA's Senior Vice President of Certifications and Exams and Content Integration, Dennis Whitney, joined us again to talk about how IMA responded to the challenging times, brought by COVID-19 and share some updates on sitting for the CMA exam. In that conversation, he also mentioned how CMA's have been able to help their organizations, weather the storm across the globe, which is a perfect segue for today's episode, where we will hear from Rob Mars and experienced financial executive and proponent of IMA CMA certification. Rob talks about the value of having a CMA and validates many of the points made by Dennis in our previous episode. Rob referred to the CMA as your global passport. So keep listening to hear what that means and other insights from this experienced management accountant. Mitch: (01:09) When we first spoke, we Identified the CMA as really being this global credential. So in your opinion, how has the CMA really helped you from the start of your career to where you are now? Rob: (01:23) Long time ago in the eighties, I started my finance career with Borg Warner. I joined this American multinational as a financial analysist in the European head office in Amsterdam. It was a great organization to work for. Plenty of room for development, with young people, senior jobs, and a strong emphasis on financial reporting, performance analysis and forecasting. I do still recall we put lots of hours into variance analysis and filling up the ROI chart. One of the seniors in the finance division in the US was the key promoter of the CMA, and Borg Warner was also a corporate supporter of IMA. I decided to go for the CMA. At the time, it was still a five-part exam. I had to travel to the US. I remember driving with our Finance Director to Columbus, Ohio, to attend the exam together, and it went well, and onthea way back, you know, I was tasting my first root beer. That was a different taste. I was keen to study for further develop, but a full postgraduate study, found to have it. So CMA was a good choice for me. It gave me a good overview of relevant topics. It gave me training and practical tools for my work, and it gave me more understanding of the US context. In our company we had many CMAs, and the fact that we had gone through the same training also helped us to work across borders and communicate. We had a common language and understood each other better when we discussed things like breakeven, contribution margin, variable costing, absorption costing, financial analysis, etcetera. And if we got in doubt, we could either refer to the same textbooks. So it was a good way to, to work across the borders. Mitch: (03:21) So that leads us very nicely into the next question here. You know, you referred to the CMA as a passport. So what do you really mean by that and how is this really, an international credential? Rob: (03:37) Yeah. What, I worked for seven years with Borg Warner after I joined Nedloyd, an international shipping company. And after two years in the Netherlands, I moved to Tokyo with my family. Later, we moved on to Hong Kong, London in Singapore and South Korea as well. So we enjoyed working and living in Asia and Europe and meeting new people and learning from different cultures. But when it comes to CMA at the time, it was all very different in my home country. When I did my CMA exam, there was no Netherlands chapter, no CMA exam site at all. I got my CMA in 88. To get a university, free university in Amsterdam, we managed to start an exam site first as a trial, and then they started a CMA review course. It's great to see it for more than 25 years, they have run it successfully. And now over two separate CMA training courses, one in Dutch and one in English. Amsterdam is the largest chapter in Europe. Right now, you can find chapters in many more countries. It's a good way to meet like minded finance professionals and network and learn from their experiences. All those countries didn't have them when I lived there. Now more than half of IMA membership is outside of the US. They are fairly active region offices, Amsterdam, Dubai, Singapore, China is truly global now. This is an incredible achievement, and I'm glad to be part of this. Mitch: (05:11) What exactly do all of these chapters have in common when it comes to management accounting, and what are these professionals have to offer with their CMA that really add value to their businesses? Rob: (05:25) What I find with the CMA, it's a part I like, you know, I always love to work on management accounting sideof finance. I have a great respect for all those who are experts in statutory and financial accounting, but I enjoyed the business part role more. I find it important to have people in the team who are experts in both fields. I saw that we could add value to the business with things like decision support and quotation tools, financial analysis, customer product profitability, performance measurement, etcetera. With this we could help steer the business and create more value added. At the time in my team, many people were trained in CPA, local CPA, mostly. And the benefits of those is that you learn the statutory texts and, financial reporting, focused on your own country. The difference with the CMA, you know, business and management, accounting, financial analysis is very of global. It's very international. Mitch: (06:39) So what additionally, working with IMA and the different chapters that holding the CMA, you know, volunteering all the work that you do. Now you're a global board member. What personally do you want to share as far as your perspective on IMA and everything that it's done for you and your career? Rob: (07:03) Good point. So another aspect I enjoyed very much being part of this IMA family. As I mentioned before, IMA  was in my early days, pretty much US focused and centered. Now with a substantial presence in the regions and more than half of our members live outside the US and IMA Board we also have now a more diverse and international members. To meet up with chapter leaders, and members from countries all over the world during conferences is great and I find very valuable. Apart from such networking, I also believe that as an IMA volunteer, gives you an opportunity to train and practice leadership skills, it is an intangible benefits, and truly rewarding. You can start in a local chapter or getting involved into regional or global board or a technical committee. There's a lot to choose from if you want to put yourself into a volunteering role . I  really get delighted to hear from young people, students, young professionals, how CMA is helping them in a career developmet. It's very encouraging. They could improve their harness skills by being part of his IMA community and connect with like minded people from the world. It's great to see this happening. Closing: (08:17) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

IMA: https://www.imanet.org/CMA: https://www.imanet.org/cma-certificationExam Changes: https://www.imanet.org/cma-certification/getting-started/cma-2020-exam-changesUpdate for CMA Candidates: https://www.imanet.org/cma-certification/getting-started/cma-noticeCoronavirus Update from IMA: https://www.imanet.org/about-ima/jeff-thomson-on-the-coronavirusFULL EPISODE TRANSCRIPTAdam: (00:00) Welcome back to Count Me In. IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson, and I'm happy to bring you another bonus episode with, IMA's Senior Vice President of Certifications Exam and Constant Integration, Dennis Whitney. Last December, I had the chance to sit down with Dennis and he talked about the changes to the CMA exam. This time around Dennis spoke with Mitch and they discussed how IMA and CMAs can make a difference through this time of need. Dennis also shared updates on CMA testing centers, exam windows  and pass rates. Keep listening to hear what IMA has been doing to support its candidates and the value CMAs have had for their organizations.   Mitch: (00:52) So thank you for joining us again, Dennis. I know last we spoke, you spoke with Adam and gave us a nice overview of the CMA exam, the certification, some of the changes that were coming up in January earlier this year. But obviously there were quite a few challenges and some changes to what's going on with the CMA. So if you wouldn't mind just starting off kind of sharing some of those challenges and obstacles that we went through earlier this year.   Dennis: (01:20) Yeah. Hi, Mitch. It's good to be with the, the program again. I appreciate you having me on. So yes, it's been a very difficult year of, in many respects in January, we introduced the new CMA content specification outline, and that went well in January and February, but then we were, toward the end of February, beginning of March, as everyone knows, we were hit with this terrible pandemic. At first it looked like it was only going to be something that was a major problem in China, and we were focused on making arrangements to change our Chinese language exam date, but then of course it spread to become a worldwide pandemic. The first impact we had was for our CSCA exam, which is the strategy certification for CMAs, and we give that exam, two windows, March and September. Unfortunately the March window, I think maybe for less than one week, some candidates were able to take the exam and then Prometric had to close all their testing centers. So that was a disappointment for us, and of course for the CSCA candidates. For the CMA exam, our testing windows don't start, you know, there's January, February, then there's May and June, and then there's September, October. So it didn't impact us or the candidates until May. Fortunately, Prometric started opening their testing sites in may, in the beginning of May, but not throughout the world. And we've seen, you know, as of now, actually all just about all testing sites, not all, but just about all Prometric testing sites are up and running and candidates are able to talk, take the exam. And, we could talk a little more about that later if you'd like, how under what conditions candidates are taking the exam, but so far, candidates are able to continue their pursuit of the certification, unfortunately, during a very difficult time.   Mitch: (03:41) So as you mentioned, this really kind of hit globally, after a couple of months, and even though the testing windows weren't effected, obviously many businesses were. So from your perspective, why have CMAs remained so essential to their workforce and why have they been able to assist their companies so much through this ongoing global pandemic?   Dennis: (04:02) Yeah, that's a great question, Mitch, and of course there, there are different categories of essential workers, including of course our frontline medical workers who have been true heroes during this pandemic. CMAs are also essential. They're essential in an economic sense. And in fact, accountants in general are critically important for the smooth functioning of businesses. They ensure that there's enough cash on hand to pay bills, to make payroll, to also ensure that processing of financial transactions are done and that managers have the results that they need to manage the business. Now, CMAs in particular, they can help companies not only survive, but they also help companies rebuild and grow. So that of course helps our economies, which are hurting during this, pandemic induced recession. And, our economies need to go rebuild and our companies need to rebuild. So this in turn, when CMAs help companies in this way, this protects jobs and it also adds jobs. So, so that workers could provide for their families. First of all, you know, from the survival perspective during the pandemic, companies need to be able to do the best to survive, to keep as many jobs as they can to meet customer demand and keep their companies in business. So that's where the risk management, cost management, and cash forecasting skills come into play. But CMAs can also use their value creation skills to help the companies not only survive, but also prosper. CMAs you know, the exam is really focused. It's a strong focused on planning analysis and decision support, and they can use these skills to help senior decision makers identify growth opportunities, which will help companies prosper, not only now, but well into the future because when the pandemic ends, and you probably reading about this, now in the business press, many companies are going to realize that they need to innovate their business models and revise their long term business strategy. So CMAs can be the trusted business advisors that they need to help guide the way in doing that.   Mitch: (06:47) I think there's a pretty good connection also to, you know, the last time you did an episode with us, you discussed the updated learning outcome statements and the different changes that went into the CMA exam, you know, incorporating a lot of the technology & analytics. So how have some of those, you know, refined skills and the different things that you're now assessing really equipped CMAs as well, and what does that look like as far as moving forward to changing these business models like you just mentioned.   Dennis: (07:20) Well, CMAs, even before this new content specification outline, CMAs, in my opinion, are well equipped to support organizations during this difficult time. But of course the profession does change as it evolves and becomes more sophisticated, more advanced, and that's reflected in the new content specification outline with a stronger emphasis on technology and analytics and decision making. And, you know, so skills like AI, RPA, data analytics, those are tools that can help CMAs provide a faster and more accurate forecast for example. Mining data, performing advanced, predictive, prescriptive analytics. These are new topics on the CMA exam, and adding these topics to actually it's part one of the content specification outline that helps the CMAs, that helps their companies, whether this pandemic. And also, it will help companies prosper while into the future because they have now the skills to better forecast the future, better manage these changing business models and help senior decision makers make the decisions that they need to, to grow their businesses. So at some point, you know, I hope soon we're going to conquer this virus, and when that happens, the companies who are planning now for the future, with the ones who are most successful for, for themselves and for their employees and their customers. Now, of course, there's these new skills applied to new CMA,s people who are taking the exam. Now beginning of January. For those who are already certified and want to develop those skills and they should, these are very important skills. IMA has ways that they can do that. In fact, IMA has two excellent certificate programs in Data analytics, which you should check out another skill that's, equally important today is strategic thinking. Cause as  I mentioned before, you know, when this pandemic ends and the future, it's probably going to be a different world. And as companies plan, they'll need to have employees on their finance teams who have strong strategic management skills and CMAs can take the CSCA certification. Which is   ertified in strategy and competitive analysis. And this will help them develop those skills. And as part of that, or even if you're not interested,  CMA is not interested in earning the certification, there's also, IMAhas a course called Strategy and Competitive Analysis Learning series, and this is something that I encourage you to take it that too can develop a strategic management skills, because in the future, not only in the future where you've been now, you need those data analytical skills, but also the strategic thinking skills.  Very important in these very difficult times.   Mitch: (10:41) So you've mentioned both exams now that IMA offers and the different certifications. Obviously, you know, we're looking to support the members and you just gave a lot of great resources, and earlier you referenced some of the different accommodations that are being made for candidates and some of the things that are going on now that testing facilities are opening and there are windows. So let's just take a step back if you don't mind for a second. And can you give us a little bit of an update on, you know, what these testing centers, what these windows are looking like right now?   Dennis: (11:10) Yeah, so as this pandemic, you know, became a worldwide problem, we quickly realized that candidates were going to have a difficult time scheduling their, their exam date, and also they would have some anxiety about taking the test. So to accommodate candidates, what we did was we wanted to give them more flexibility, and so we made some changes to the testing windows. The first thing we did is we extended the Maym June testing window to the end of July, and then we also extended the September and October testing window to include August. So this provides six consecutive months of testing, and hopefully this should alleviate some of the anxiety candidates have about scheduling the exam. Now, the other thing we did for the Chinese language exam, we postponed the April Chinese language exam to the end of July. It was supposed to happen at the beginning of April, and we've moved that to later in the month of July. As far as Prometric testing centers are concerned. As I mentioned a little earlier, they did start opening in the beginning of May and almost all of them, around the world are open now. Tt was a progression as to which ones, which countries opened first, dependent on the country and they followed the guidelines of the government and the health and safety of the examinee's is a priority for both IMA and Prometric. So, actually the first sites to open where in China, because China had pretty much moved to leveling out the, the virus situation. So they opened first and then many sites in the U S and a few sites in Europe. Sites in, for example, the Middle East opened just recently and also the Philippines, but pretty much all sites are open. Now, the testing is different, however. because of the health and safety priority, Prometric made modifications to their testing centers, and they also implemented new safety guidelines to ensure a safe testing experience. So all examinees and old Prometric employees are required to wear face mask and social distancing is enforced at all the sites. So that's one big change, the face mask in particular. Also the centers undergo continuous deep cleaning. And the good thing is that Prometric is working very closely with scientists at John Hopkins University, which is one of the leaders in this field and they are consulting. They're actually visiting testing sites to ensure that there's a safe testing environment for our candidates. So, it's going well. Since the beginning of May, we've administered almost 1500 exams. Of course, in May that was the smallest number. June the numbers got bigger. And now in July, we actually have about 3000, tests that are scheduled in the month of July. And of course, candidates are scheduled in August and September and October. So we're starting to see the momentum and people getting back on their, their journey of pursuing and finishing the goal of earning CMA.   (14:51) Well, that's all great news and that's very good progress, and thank you for sharing that update, globally, specifically, but I guess the next question is to really wrap up this conversation as far as an update on the CMA, how are the results looking? I know IMA recently released a report on the pass rates. So would you be able to share some of, or at least summarize the findings from that?   Dennis: (15:14) Yeah, sure. So, the candidates have actually done quite well. We introduced the new exam in January, and that included the new section of part one on technology and analytics. And in part two, we had the additional emphasis on business ethics and decision making. So the global pass rate for both parts during the January, February testing window was 45%. Now for part one, this is actually an increase from the 35% pass rate that we've been averaging over the last several years. And for part two, it's comparable to the 45% pass rate is comparable to what the average has been over the last several years. So in part one, where the pass rate increased, that's where we have the new technology and data analytics content domain. So to me, this shows that the candidates understand the importance of the subject matter. They really want to learn on it. Of course, it's all about passing the test, but it's also about learning, you know, and getting the skills you need for the job. So they understand the importance of this subject matter, and also, I think the review course providers have done a good job at preparing the candidates with their learning material and the instructors in the live or online courses. And then of course it also shows that the candidates studied hard. You know, the CMA exam is definitely, something that can be passed, but you do have to study. It's a rigorous exam you have to put in the time, and it really does show that candidates have studied hard. Now, you can't really project these past rates into the future. But, it's encouraging. And, you know, we will look at the pass rates again after we finished this testing window of May, June, and now it's been extended to the end of July. So far looking at the main results they look pretty good. So, it is very encouraging. And just as an aside, Mitch, you know, we've also received a lot of positive feedback from not only our candidates, but from other stakeholders, you know, corporate executives, CFOs, controllers, that this was really an important change to the exam, heading the new content with technology and analytics. It really matches well with where the finance team needs to be today.   Closing: (18:01) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession, if you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Chris Wymbs: https://www.linkedin.com/in/chris-wymbs-b4b4b789/FULL EPISODE TRANSCRIPTMitch: (00:05) Welcome back for episode 79 of Count Me In IMA's podcast about all things affecting the accounting and finance world. I'm your host, Mitch Roshong and today we will be hearing from Chris Wymbs, the Executive Vice President of Finance and Chief Accounting Officer for AMC networks. Chris has significant leadership experience at a Fortune 50 company and as a finance executive with a proven record of success and extensive background in all aspects of finance. In this episode, he speaks with my cohost Adam about the leadership qualities needed to succeed in your career and how one can effectively lead change and innovation in their organization. Keep listening to hear an insightful episode about leadership, innovation and business transformation.   Adam: (00:54) So, Chris, can you tell us a little bit about your career journey and how you got where you are?   Chris: (01:02) Yeah, sure Adam, be happy to. So, it has definitely been a journey it's a good way to depict it. So if I think of the start foundationally, it was early days at Ernst and Young progressing up through the ranks there. Was in the audit realm as well as a support in the advisory services side, worked in a lot of different industries, and I deem that to be foundational to my, as I mentioned to my career progression. From there, I moved on to a little company known as GE at the time, and to an internal audit role, in their corporate audit group, which was exciting and fun and leverage the skills I had from my audit baseline, if you will, or foundation. And then moved into a, at the time a controller role, a global controller role of one of their, financial services businesses, GE Consumer Finance. And there, I really kind of cut my teeth if you will in the operational expertise realm. We were very inquisitive. We had a lot of deals internationally and I got to travel quite a bit, see different cultures, even though I was based domestically and really built out, I'd say kind of the foundation of my leadership skills and more of the executive level, as well as just some financial skills that I really hadn't gotten involved in in my days at Ernst and Young and really owning aspects of the finance organization and building out a team which was exciting and fun. And from there, I progressed into a company, American Express, and took a controller role there. And soon thereafter, less than a year, I moved into more of an operational role. So I was in the FP&A role for a few years. I was in various segment CFO roles over the years, three or four of them. And as I progressed in those roles, it gave me an opportunity to, to steepen and the realms of operational finance, not only from a controllership perspective, but from an FP&A perspective, a corporate finance perspective, and really just continue to build out my financial tool set. And then that brings me to the current role as  I'm EVP of finance and chief accounting officer at AMC networks. And I operate in both the controllership realm as well as the operational finance realm and have a myriad of responsibilities. And as I think of the journey I've gone through, it really has set me up to, to excel in the role I'm in today. And it's, it's comprehensive and it's wide ranging across the finance spectrum. And, and I lead a reasonably sized team and I enjoy that and I am an extrovert by nature. So, being in the leadership role is exciting and fun to me, and it does get me out of bed in the morning, although these days getting out of the bed means just walking downstairs and not getting on a train. So that's kind of in a nutshell, hopefully that covers the question.   Adam: (03:52) So thinking about that journey, could you describe what leadership characteristics have enabled you to get where you are today?   Chris: (04:03) Yeah, another  great question. So leadership, it could mean different things to different people and means different things in different cultures and different companies. And as I mentioned, I've worked in a few different companies, but to me, leadership, there's just some foundational things that are absolutely, you know, core given definitions of what leadership is. And for me, it starts with kind of consistent values, and some of those, if I were to just dispel some of those fundamental values, first and foremost, it's integrity. And, everything I do and everything in the bedrock of my leadership is integrity. So my actions will match the words I speak. I, you know, I will always take the higher road whether, you know, whatever issues it might create. And, you know, if you don't have your integrity, then it's really questionable as to what leader you are. And I don't think you can have the right fabrics of a leader without the key bedrock of integrity. And then from there, it kind of builds out and you can kind of go different ways. And for me, if I were to think about the feedback I've gotten over the years from people who've worked for me, they talk about me being an empowering leader. So giving them the ability to go out and do things on their own without my direct oversight, but still providing them enough oversight and guidance to help them succeed. So that's hard as a leader to balance empowering people, but at the same time supporting people. And I think that's foundational to my leadership approach. And then around that, it's how do you develop people? And that's giving people an empowerment, but also how do you continue to develop them and build their skillset and give them confidence and create a safety net around them at some level, although you do need to let people fail at times, and that's how we often learn the best, but, you know, just giving them an ability to continue to develop and supporting them in that development, whether it be getting additional training, having conversations with them in tough areas, and as they develop and progress and become leaders of people, that's a whole different dynamic there's leadership in the entity, as far as driving things forward, but then there's leadership of your team and those mean different things and helping people develop skill sets and both project and people leadership, you know, it takes some effort and some support to do.   Adam: (06:30) So what counts as innovation in your organization? How would you define it, and what does innovation mean to your employees?   Chris: (06:39) Yeah, innovation, a tough question. Not unlike leadership. How do you define it? It's defined quite different people define it different ways. The way I think about innovation is kind of through a three-pronged definition, if you will, firstly, there's technological innovation, that's we all know what that is, right? It's the next generation of the, whether it be the app or, you know, the platform where using the next generation of, you know, Oracle so on, so forth or SAP for that matter. There's also process innovations. So that to me could be evolving and driving more efficiency and effectiveness in a process, technology unchanged. And then thirdly there's, and this is where I think most people define innovation. It's the new thing. It's the new app that didn't exist before. It's the, you know, it's the Uber, it's the, you know, however you want to define it as the Priceline if you go way back that just didn't exist previously in the travel realm. It's the ideation of something that didn't exist and that at its core is kind of foundationally innovation, but for finance organizations, it's kind of hard to focus and operate in the ideation realm of innovation. So where I tend to hone my team and more is how do we drive innovation from a tools and platform perspective and a process perspective. And as I mentioned, part of my career journey was spending time at GE, and one of the things that was incredibly pervasive at GE is six Sigma and that's around process improvement and optimization. And it started really in their industrial businesses in aircraft parts and engines, and their industrial businesses for power generation, where they were  eliminating defects in a production manufacturing process, but GE was genius and they started to apply that to their business processes, and it was a big deal for many years there. It also has its cons because it can get you really kind of wrapped up in process and not see the bigger picture at times, but, you know, so that's an area where I really think there's a lot of opportunity. And we often, you know, I challenged my team to innovate and not just do the job day to day, but to step back at times and think about how can I do it differently and more effectively. And that's, to me, innovation on the process side, and then there's technological innovation and that's reading and talking with your peers and understand what's going on in the industry. And what's the great new tool and the next, the next version of the platform and, and being zealous about bringing that in house and leveraging it more. And there's many people who are afraid of the next generation of technology, and we've all gone through system migrations in there. They have their warts and their pain points, but at the end of the day, when you typically come out the back end and you're on the next generation of the platform, there's a lot more efficiency to be gained. So, so it's multifaceted. And I think for me, I really hone in on the process aspect of it, as well as the tool or platform or technology aspect of it.   Adam: (09:58) As you were talking through that, it almost seems like the technology aspect helps build the build to the better process. So if you get the technology, it becomes a better process and then it leads to new things that happen.   Chris: (10:12) Yeah, yeah, absolutely, but at the same time, you can have the same platform, the same tool, but improve the process dramatically because, you know, there's just oftentimes a lot of human, integration or intervention and automated processes. So you can keep the platform or the tool the same, but you know, have process improvement and that it's harder to do, but it is attainable.   Adam: (10:38) Definitely. So it was different kinds of, are there different kinds of innovations that you've adopted to make your business more effective?   Chris: (10:46) Yeah, I think it gets back to, I think we've been pretty adept in my current organization at identifying the new platform of their new tool, and I've been very zealous in implementing and identifying and implementing that. So there's reconciliation tools that we've increased utilization of that make things easier, although harder at times in the short term, but ultimately easier. You know, we've standardized a lot of our ledger globally, which is kind of foundational, but it wasn't when I first started. So there's aspects of the platform, aspects of new tools that we've implemented and, you know, we're succeeding, but I'd like us to be better at the process improvement. And that's a cultural change because it's changing people's mindset of just coming in and yes, this is the way I do it and it works and it's controlled. And my SOX documentation is all in place and everything's great, but maybe I can do something inhalf the time, if I think about doing it a different way. It takes effort to, and outside the normal day to day to step back and look at a look at something and look at something holistically and not just your piece of the process, but as we used to call it a GE the wing to wing aspect of the process, which goes back to the aircraft. Or the end to end from start to finish and things that I don't necessarily own, but occur in the process. And can I do things differently or have other people do things differently to help me do my job more efficiently? And it's the taking that bigger view and that's hard to do, and it takes time and we're endeavoring, but it's, you know, it's a journey it's surely not, we're not at the destination yet.   Adam: (12:28) Do you have any advice for people who have, or having trouble with their employees, seeing the bigger picture? Cause sometimes it's easier when you're at the top to see the big picture, but how do you help the person who is doing that one little process to see the big picture to understand that this is why I'm changing your process?   Chris: (12:43) Yeah, it's really a really insightful question because like I stated, we get in our day to day and this is what I come in and what I do and how I do it. And, you know, unless you, well, firstly, you need to create the opportunity  for folks to have relationships so they're engaging with others across the process. In some instances they might not have any interaction with others that are working within the same process. So that's kind of foundational, and then you get to creating, it's a cultural change and getting pink people to think about, you know, what could I, what could I inquire of my peer who is doing certain things to understand the overall process better and work collaboratively to say, Hey, if you do X or Y a certain way, it'll make my job easier or what can I do to help make your job easier? Maybe I don't need the 20 data sets that you send me or the 20 aspects of the data that you send me. Maybe I only need 12 of the 20, and just driving that communication and that conversation is that's innovation at some level. And, you know, it takes effort and focus and a cultural dynamic to make that occur, which otherwise just goes a bit unsaid  and never gets unearthed.   Adam: (13:56) What changes have you noticed in your responsibilities and expectations during these unprecedented times that we are living in, right?   Chris: (14:03) Yeah. Yeah. great question. Unprecedented times. So when you say that, I think of two things, I think of, you know, the world of the pandemic that we've been living for the last, well, at least six months, maybe longer, in the area I live in the Metro New York area, we've been in a shelter in place since early March, mid-March if you will. And then there's a second aspect to it and it's more recent and it's the social injustice and the causes around that, that have evolved in recent weeks. And, you know, it saddens me to see some of the things that have occurred, both from a societal perspective geared towards, different aspects of our society, but also the, the physical damage that's occurred in many of our cities and towns and working in New York and seeing the things that occurred it just really saddened me outside of the videos of the injustices that have played out. It's just, it's just completely wrong. So, you know, I can go on and on about that. But if I come back to the question in this unprecedented time from a COVID perspective, there's a few things, right? It's just, we're all working remotely or working from home and when doing so there's a couple of things that I've kind of tweaked in my approach. First and foremost, it's around just significant increase in communication. And I stay close with my teams. I have one on ones with my direct reports weekly. I have leadership team meetings monthly, but I've accelerated that where I'm touching base with my leadership team weekly. I have broad town hall meetings more frequently, ideally once a month. We've had two thus far. There needs to be a better sense of community because people feel a bit disjointed today. So being more engaged in communication and, and just driving more engagement across the organization is critical. So that's one. I think, secondly, it's around, you know, how to, how do you tweak your leadership style a bit and, and how do you continue to work on projects and the business as usual, but do it in a more virtual environment. And again, I think that that comes back to a lot more communication, but a lot more frequency and interaction on projects that are special projects, but also the day to day and the business as usual. And, part of it's just leveraging technology more. And gosh, video conferencing, I never realized how important that technology would become, but it's kind of the mainstay of how I communicate today. And for me being an extrovert, as I mentioned, it's, it's a bit taxing. I need the personal interaction and to be in my home, isolated quote unquote and not being in a conference room meeting with people. It's definitely, it definitely wears on me. So for my own self personally, it's important for me to have engagement with the team. And I imagine many folks on my team feel the same way. So, from a COVID perspective, you know, we're managing the processes, we have the right technologies in place. We've realized that we can do things very effectively outside of the office, but there's the sense of community and the engagement across the teams that are critical, and we need to focus on and continue to support. So that's, that's from a COVID perspective, from a social injustice perspective, you know, I felt like, and I, when I look at my organization, I feel like as I'm on a zoom call and I've got the Brady bunch blocks up on the screen, as I look at my team, or if it's in the conference room pre COVID, I look around the room and I view that then they are being, they are representative of the environment we live in. So from a gender diversity perspective from an ethnicity and racial, diversity perspective, the room is very diverse and that's great. And it's, exciting to me and I'm proud of it, but I felt like I needed to take a moment in these times, and create a bit of a safe space or a safe place for the team to have open conversations about just how we were feeling about things that were playing out in the world, whether it be the physical damages that were occurring in cities or the horrific videos of terrible things that were happening to people, more than more than one instance. And it was a great thing to do because it just opened up the floor. And I felt, I, I espoused how I felt, how often we were talking about it at the dinner table and how I didn't have the answers for my children, I have three. and I got a lot of feedback saying it was great because it just set a bit of ease and that there is no perfect answer. We have to start through talking about these things and it's just the beginning is the conversation. And then where do we take it from here? And the question is, where do we take it? And it's just a bit unclear, but the bottom line is we need, we all need to step up and make change in today's world. And you know, the younger folks and it's great. I've seen it on TV, the younger folks, standing in front of the demonstrators in between as a shield between the other protesters and a diverse slate of folks who are standing in that front line. It's not just one race. It's, across many it's multi-racial, it's, you know, it's across both genders, it's young and old. It's just great to see that I think there is a difference in today's world and, you know, I can go on and on about this and I'm passionate about it. But I do think in the workplace, we do need to create a bit more of ease to have the tougher conversations, and that's where it starts.   Closing: (19:58) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard. And you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Heather Bain: https://www.linkedin.com/in/heather-bain-31223320/Small Business Planning During COVID-19: https://www.imanet.org/insights-and-trends/risk--management/small-business-planning-during-covid19FULL EPISODE TRANSCRIPT:Adam: (00:05) Welcome back for episode 78 of Count Me In IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson, and today you will hear my cohost Rouba talk with Heather Bain, owner of Bain CPA Business strategies, and IMA a Small Business Committee Chair. Heather has experience in numerous industries, including oil and gas, real estate and computer technologies among others. In this episode, she discusses a white paper she authored with IMA Small Business Committee on small business planning during COVID-19 the report provides insights to help small, to medium sized businesses, weather the storm, and develop strategies for survival. For another timely episode relating to today's business environment, keep listening and hear from Heather Bain now. Rouba: (00:54) I've been reading, you know, the paper that you published and that you were the lead author on, which was Small Business Planning During COVID-19. This was a white paper that was authored by IMA's small business committee, which you chair, and it was published by IMA. So it's been a really interesting subject to read up on. This paper outlines the key steps that small businesses should undertake in order to minimize the impact of the coronavirus on business operations. When publicizing this report, you noted that SMEs are very vulnerable and in dire need of support with emergency response and recovery plans. Why is that? Is there, is there a need for more resilient financial capabilities within the SME segment? Does this actually point out that these may not be at the level that they should be at present?   Heather: (01:46) Yes, that is always a concern. because small businesses don't have the same resources that large companies have. Larger organizations have many departments and they also have greater financial resources to be able to respond to the lagging in the financial markets and those sort of things. They can allocate more personnel toward different projects that might help them. For instance, you're probably familiar that data mining is very popular and it helps larger companies identify their core competencies and the needs of their  customer base, and smaller companies don't necessarily have that sort of access to know what the broader market is to be able to shift over and offer services on a broader level. They also don't have the same resources to create the technology, but the smaller businesses have the advantage of being a little bit more nimble in the market and able to respond faster because they don't have to shift a large organization. So there are pros and cons, but the smaller businesses are more vulnerable, because many times the owners of the business are dependent on that, the income directly, and they don't have the same financial resources.   Rouba: (03:32) The question was also to look at, for example, the actual skill level of financial capabilities, like not every single one of them has the opportunity to hire a CFO.   Heather: (03:42) That, that's absolutely true. They often are. They're wearing all the hats at the officer level, or they have one or two key people that they're relying on. And frankly, many of them don't have any plan in place in the event that one of the key persons is taken out by a COVID virus or is unavailable because of the restrictions in quarantine and that sort of thing. If they're taking care of a loved one during this crisis, and they're not available as much as they were before many small businesses don't have the resources to respond.   Rouba: (04:27) Would you  in such an instance, is it maybe a potentially as a kind of support that they could outsource at a time like this, where they desperately needed it in order for their business to be, to survive. Would they need this kind of input from third parties potentially?   Heather: (04:46) Yes. They definitely need to hire a team of experts as much as possible. They need to consult, experienced accountants, attorneys, anyone that that would know how to put a plan in place and then help them have accountability for implementing that plan.   Rouba: (05:09) The report also provides some major insights on you know, to help SMEs weather the storm and the hope of a quicker recovery post COVID-19. And it's structured around three key steps. Can you, can you tell us a little bit about these steps?   Heather: (05:24) Yes. Well, the first step is, A: assess the situation.  Taking a completely comprehensive overview of the scenario that each individual business  organization is facing is crucial. So many businesses overlook certain details as they're just in a reactive mode. So there's a financial crunch. Cashflow doesn't look good, so they just react. They start cutting employees, but then that may have unintended consequences for being able to service the customer or they, the small business owner may, may not even be aware that that their rent is not going to be forgiven or there won't be an exception for certain customer contracts. So they need to look at all of the components of their business in order to see what areas they may have weakness so that they can identify potential problems and be proactive rather than reactive in the market. So we advise that cashflow is the most important thing to focus on in the assessment, but also looking at your human capital and looking at the relationships with customers and vendors because supply chain issues have certainly been a major concern. So we say, look at your  legal issues, your financial issues, your human resources issues. I'm looking at the whole picture, your communication and technology piece with your operations and pulling an entire plan together, which is what step two is all about building the plan and you'll need the expertise of people outside of your business. Most likely if you're a small business, since most likely you don't have those resources within your organization. Having a finance expert, having an accountant, an attorney, human resource advice. Sometimes, if you work with government grants, you'll need someone who specializes in government grant contracts. Those sorts of experts can help you pull a plan together so that you, as the person business owner or leader, are able to move forward confident that you're, even though your plan will change, and it is dynamic, you'll still have a total proactive plan in place rather than just responding on the fly as we say. So the third, is the third step is to communicate clearly and calmly. And that is another area that small businesses can be a bit weak in it because the leader and leaders tend to keep many  of these plans and they're in their own heads, rather than communicating effectively to their entire team. There can be a lot of miscommunication and people acting on their own instincts or their own judgment rather than sticking to the plan. And also in this time of crisis, a lot of employees are panicked and there's a lot of fear. And so keeping calm, clear communication, making sure that everyone understands what they need to do and what the end goal is will help to hold the organization together and to still present a cohesive brand to the customer and to clearly identify any issues that might be coming up. For instance, if a customer has a new need that the company can meet, then if there's clear two way communication between the company leaders and the employees on the front line, dealing with the customer directly, then there's an opportunity to service that new need and create a new revenue stream. So it's very important that the customer and employee and the leaders are all communicating clearly about needs, about ability to meet the needs, and the same thing is true with vendors. When a vendor can't meet a need, it's good for the leaders of the organization to be able to clearly communicate with, with the vendors as well. So everyone involved needs to be engaged in two way communication, rather than the leaders just pushing information down through the organization without getting feedback from all levels of the organization and all of the outside influences and relationships that they have. Does that answer your question?   Rouba: (10:54) Yes, absolutely, and these are very constructive and helpful steps. I'm sure that a lot of leaders in the SME segment would really benefit from this and we will provide the link so that they could, you know, read through this, a bit more in detail. You have extensive expertise in numerous industries. I mean, you've gone through oil and gas, real estate, human resources, computer and technology, and training. In your experience, should SMEs be hopeful? I mean, can they be hopeful? Can they survive this pandemic and come out of it as ambitious and capable as they once were?   Heather: (11:29) Yes, they can assuming that they create a plan as early as possible. Assuming that they are, that they are in their rational mind, then they actually can come out stronger. They will have setbacks. Every organization I've interacted with since the beginning of March has indicated that they've definitely had setbacks. They've had interruptions in cashflow and limitations on some of their resources, but many of them are very hopeful that they can create a plan, and that once we're past this, they will actually be a more dynamic organization and able to respond to future disruptions in their business.   Rouba: (12:20) You consult for, for various companies perhaps more so at present than ever. At a time when your guidance is crucial. Are you finding that some companies are doing better than others? And what are the reasons behind that? Is it because of their industry? Is it because of strategy? Is it agility? And what are some of the qualities that you find are fundamental to survival at this kind of time?   Heather: (12:45) Well, the businesses that are doing better than others are the ones that are the most creative. They've created a plan and they're executing the plan to meet the new needs. They understand that we're in an age of a new normal. Things are, are evolving, and many of these companies are just not looking back at the past saying, this is the way we've always done it. They're looking forward and saying, we are going to build a new business model. We'll address new needs of our customers and we'll deliver our services in whatever mode we're allowed to and keep as many of our employees and vendors as possible. So many of the companies that I've worked with have shifted over to a more, COVID  oriented business. For instance, I know of a company that shifted from a small manufacturing company to a much larger one, simply by, by offering a COVID face shield because they were in a, they were in a market that would allow them to manufacture these face shields and they already had the facilities to do it. They just said, okay, well, this is where the need is right now. This is how we'll meet that need, and they were actually able to increase their workforce during this time. So they, they positioned themselves to look forward rather than just shutting their doors and saying, well, there's no market for what we offer right now. The same thing was true with an exercise clothing manufacturer, they cut up all of their t-shirts and made masks out of them. And then we're selling them to hospitals because the hospitals were short of masks, and this is a special fabric that is antibacterial. So it can be washed over and over and doesn't collect bacteria, and it was really a unique selling point for this particular company. And they they've been able to actually increase their, their sales during this time, rather than decrease their sales. Obviously technology companies can increase, and biotechnology companies can increase their sales as well because globally we're all looking for better technology, and those of us who are quarantined are very interested in any way that we can communicate better with the people we can't see face to face. So all of these emerging markets are opportunities for businesses to shift their business model and their service offerings to actually improve their quality of service and their, their revenue stream and survive through this time.   Closing: (15:54) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Ron Guymon: https://www.linkedin.com/in/ronald-guymon-369b1710/Ron Guymon at U of Illinois: https://giesbusiness.illinois.edu/profile/ronald-guymonIMA Data Analytics & Visualization Fundamentals Certificate®: https://bit.ly/38Iy90lU of Illinois and IMA - Beyond the Basics: Data Analytics and Visualization for Accounting Professionals: https://giesbusiness-ima.thinkific.com/courses/btb-davapRon's Articles Published: The Effect of Task Interdependence and Type of Incentive Contract on Group Performance: https://meridian.allenpress.com/jmar/issue/20/s1 Controls and the Asymmetric Stickiness of Norms: https://meridian.allenpress.com/accounting-horizons/article-abstract/33/4/119/427557/Controls-and-the-Asymmetric-Stickiness-of-Norms FULL EPISODE TRANSCRIPT:Adam: (00:00)Welcome back for episode 77 of Count Me In. IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson and today's conversation revolves around the future of accounting education. For this episode, Mitch sat with Ron Guymon, Senior Lecturer at University of Illinois. There, he teaches data analytics to online master of accountancy students. Ron also has experience helping small to midsize companies assemble, analyze, and visualize data to find actionable insights. In his conversation with Mitch, Ron discusses, what he has already seen in accounting education as universities seek to prepare the future of our profession and share what he believes to be the most valuable skills for students going forward. So without further ado, let's get over to their conversation now.Mitch: (00:58)What has your role been in accounting education and how have you seen the curriculum or the required components change along your journey? Ron: (01:07)  I had been in academics for a while and there had been a growing awareness in  academics, at least since about 2010 of the need to teach students more data analytics skills. Most of it was in Excel at the time. Because my academic background, I had some data analytics skills with SAS that I learned for academic research purposes, but those skills and some relationships led to an opportunity for me to leave academics and join a small, but growing business intelligence company called New Metric. And it was a risky decision at the time, but I knew the analytics were important. And I thought that if anything, this would give me some good experience that I could eventually use in class. I was also motivated by some family reasons. So, anyway, there was that side of things, but it turned out to be a great learning experience. And, you know, some things I learned have benefited me in the classroom as I had hoped, I guess. I learned how to use some proprietary data visualization software, and I also learned how to use R. So I had used SAS a lot for academics, but I learned about some other  skill or, analysis technique. And when I looked at, when I researched about it, I found a lot of references to R and so, that's what got me into R. So my academic training was really helpful and it gave me a leg up on the statistical concepts, however, I think I can relate to many business professionals who have primarily relied on Excel and they're worried about the learning curve associated with learning a data analytic language. So, anyway, so I've come back into academics with, some experience using data analytics software that has been very helpful. Mitch: (03:03)So you touched on it just now and you said, it may be difficult for some business professionals to run either, maybe want to pursue learning this new language as you put it, or the fear of being able to. So what is your perspective or what have you seen as far as particularly accounting and finance professionals really interested in this sophisticated data analytic competencies and, you know, even going back to students. Are they aware of this growing need and the fact that it will benefit them in the future? Ron: (03:40)I think the professionals are aware of it, and I think that's because data is seeping into every part of an organization. And so I think they're becoming aware of it, or at least the need to be able to process more data and a desire to do that. They may not know that a data analytic language is, a tremendous way to help process more data. I know there are other tools available like Tableau for visualizing data, and some other tools for automating processes. But, I've definitely seen a need for, pretty much everyone in an organization, at least in my opinion, could benefit from learning a data analytic language. Cause you can just automate things. Students, I think are less aware of that at least undergraduate studentsk and, and so it's a little bit harder for them, but MBA students and masters students, I think they're, they're more aware of it cause they're a lot of them are working professionals as well, and so they've realized the limitations that come with point and click software, the benefits as well as the limitations, and so I think they're aware of the need to learn about it. But, yeah, the way, you know, it's kinda tough to transition from Excel or a Google sheets to a data analytical language. So that's the part that I think a lot of people are trying to navigate right now and it's not easy cause it takes time and people are working, they have families, and, and how do you learn something that's a pretty dense topic and, it takes a while to really be proficient at, but, anyway, so I think, I hope that's what I'm helping people do now as a professor at the University of Illinois, so anyway. Mitch: (05:33)No, that's great, and you know, I'm sure you have your own preferences, but for our listeners here, if you could just offer up some kind of recommendation for those who are interested in pursuing more of this deep dive education, whether they are in the classroom, looking for some outside resources, professionals looking for some continuing education, where do you start and how do you really get feet into learning this new language? Ron: (06:00)Yeah, that's a great question. There are so many resources out there. You could probably find a bunch on YouTube that are free. The problem is it's hard to know where to start and so I, yeah, like you said, I'm biased. I think the resources that the University of Illinois put up on Coursera are fantastic and we've tried to help people identify where to start and made a smooth transition from Excel, working parallel with Excel and AR or Python, so that you can really see what the language is doing. So yeah, that's my, you know, that's my bias. But before I was doing this, I found, I stumbled upon some great resources and I don't think it was stumbling. It was a result of going to meet ups and talking with others, but there's this group, or maybe it's more of a philosophy in the R environment, the R ecosystem, and it's called Tidyverse. And, there's this guy Hadley Wickham, who's like the leader, and he just has a way of thinking about manipulating data and has created a language that goes with that. That makes it really easy to take raw data and put it into a format that you can then analyze. And so there are some online resources from our studio that's where Hadley Wickham currently works. So our studio has a ton of great resources that will help you get started using R and analyzing the data in R as well. But I think for most people, the initial starting point is just learning how to read in data into Python or R and then start assembling it so that you can then visualize it or analyze it. And frankly, that's one of the, I think, maybe hurdles that a lot of people face is that they think, oh, I have to be a data scientist before I can start getting any gains out of using a data analytic language. But that is not the case at all. I think if you just learn how to automate a process of just reading end data, cleaning it up and maybe reshaping it and set that to run so that it happens every day so you don't have to manually do it. That'll save tons of time and you don't. And that, so let's, before you even know anything about neural networks or regression or anything that is a more deep. Mitch: (08:37)Yeah, for sure. And I know where to start and that kind of fear as you were talking about some of the stuff going really deep, you know, we recognize that as an association at here at IMA and, you know, we started, our own data analytics courseware, really focusing on our data analytics and visualization fundamentals certificate, because like you said, some students, professionals who want to learn this stuff, but they really need that foundation. You know, that's what we wanted to make sure that we had to offer these fundamentals. So, you know, I would just like to plug for ourselves there and add a little extra resource that, you know, that's a really good starting point. And then you mentioned all the Coursera work that, the University of Illinois has out there. And, you know, we came across that and fortunately enough, IMA and University of Illinois, as, you know, we're able to use one of your courses. So, you know, I I'll plug that for you right here. You have the, the Beyond the Basics Data Analytics and Visualization for Accounting Professionals. And, you know, I went through that course myself and I must say, you know, it's, it's a little bit deeper and it's a great launching point for those who are interested in these different languages. So, is there anything specific about those, about your course, I guess, and, you know, the University of Illinois that you'd like to share as far as what data analytics and visualization really means for the accounting professional? Ron: (10:07)Yeah. Well, thanks. That's nice of you to say, so I know there's always room for improvement, but I do hope it is an easy way to get into the area. Yeah, so I would say about that course, we have tried, I've had some experience teaching data analytics, and I think this course is a good, we finally found something that is, makes it more available for the masses data analytics, more available. At least learning about it, because it's so easy to forget what you don't know, and I think a lot of times when we start teaching data analytics, we want to get people up to speed where we're at, and we forget what we didn't know when we were starting. So this course really focuses on using Excel and showing people now using the great visual nature of Excel to manipulate data. We use that to show people what it means to  convert data from wide to long, and what's happening when you do cluster analysis. And so I think it's a, you know, that this course helps people get an idea, just kind of have that understanding that mental mindset that's required to know what's happening when you use a language, because language does everything in the background and you can't really see what's going on. That's, what's beautiful cause it happens so quickly. But if you don't know what's going on, it's, it's like magic. So I, so we've tried to kind of walk people through the process in Excel, something they're familiar with and get them to a point where they appreciate, okay, I don't want to have to drag it's the bottom of every column every time and rearrange columns before I can start doing a regression analysis or standardize the data manually using Excel for every row. And so, you know, then at the end of that course, we introduce visual basic for applications. The data analytical script language for Excel and we show people, hey, this is, this is a benefit of using a language. You can do these things with the click of a button, and, and so I hope we get people to a point where they're able to appreciate the value of a data analytic language and, you know, frankly, even if they just start using more visual basic for applications in Excel, I think that would save them a bunch of time. So, I think that's what, at least I hope that's what this course does it helps gently introduce people to this mindset so that when they start using Python or R they'll understand the analytic side of things and it's, you know, just learning the language side of things. And then you also asked for accounting professionals and, the importance of visualization. I think for, but almost well, not just accounting, but, in I don't know, probably every domain I'll qualify that because there's always an exception to the rule, but almost every domain has, or it could benefit from visualizing data because you're able to see relationships so much faster than when you're just looking at numbers. I think accounting and finance people are really good with numbers and we want to see the details. And so there's maybe less of a need for visualization in some sense, because people want to see the exact numbers want to understand, you know, how, how do the line items add up? But the same time I think being able to visualize trends is, is obviously very important. And so being able to create those visualizations on your own, I think is really powerful, and that's just a starting point. There's so many things that you could use analytics for such as finding or maybe identifying, prioritizing the list of customers who aren't paying on time, and so who's most likely to, end up paying, right? And who should you contact first? If you've got a lot of customers who you need to collect from, then you could create a model to help identify who those people are. You could also use analytics, especially for management accounting topics, one couple of areas that I've thought of a lot about our and  I'd love to get into more is identifying cost drivers for allocating overhead, cause there's so many different potential cost drivers you could easily, well, maybe not easily, but you could set up a script to look at the relationships between a number of different drivers and see which one is most accurate in leading, you know, forecasting costs are what overhead costs are. I think it'd give you a lot of insight along with standard costing. Being able to aggregate standard costs, start at a disaggregate level, bring them, roll them all up to see the overall favorable and unfavorable amounts and then break it down again and visualizing that I there's a lot of room for analytics to help with those processes. Mitch: (15:24)So it sounds like there's a tremendous amount of opportunity when it comes to incorporating analytics into accounting in general. You know, when we first started discussing this conversation, I'd said, I really want to focus on, you know, the changing need of accounting education and I want to make sure that applies to continuing education as well. but I think, you know, what I would really like to kind of wrap things up with here is, you know, what is your recommendation moving forward for anybody interested in any aspect of accounting, as far as the skills and competencies needed, you know, resources that are available, tasks on the job that you think would be beneficial, different projects to work on, what is it that you would recommend a student or a professional to really focus on to ensure that they are maximizing their personal value with these data analytic tools? Ron: (16:21)Yeah, let's see. I would say, don't try, don't bite off more than you can chew at once. I think if you try to just learn, you know, if you say, I just want to learn how to program or code, it's very abstract and that's really a hard way, especially as you're working, you're not a, if you're not a full time student, that's a hard way to go doubt things cause you just don't have time. So I think if you can just take whatever project you're working on and you could just try to start with that and think about what could I do to make this faster, make it more efficient. And I realized that you may not have, you may not know the terminology where to start what, even to Google. But if you could maybe contact someone who maybe there's a data scientist in your organization, or a friend or someone who, you know, that it was good, you know, with data analytics and describe the problem to them or what your tasks are, and they might be able to recommend to you where you could get started and what kind of tools to look at. And I think if you start with that, you'll learn some things that you can apply right away. It'll be productive for you. It's not just simply theory. It's not something that you're going to learn about and then forget because you don't use it, but it's something that you'll be able to put into practice right away. And so you'll remember it. And then there you'll learn a ton. They'll probably take a little bit of time to set things up, right. Just to start using Python or R. I know for me initially it was  like this is what developers do. I have no idea how to do this. And so just getting started with it was a huge hurdle, but, once you get past a few of those huge hurdles, every additional hurdle becomes easier to overcome and it makes it a whole lot easier to work on those hurdles, if you're working on a problem that is paying you, you know, it's a problem you have to work on for your job or, or something that you're super interested in that you would worked on anyway. If you, you know, if you have a hobby for, sports, for instance, you might be able to analyze sports data or cars or whatever the case may be. We live in a world where data is everywhere, so you can probably get data about anything, and so just find a project that you're interested in and try to, you know, think about what you might do in Excel. And then think about what you, how you could, you know, start learning how to automate that so you don't have to copy and paste things as often,you can automat itClosing: (18:57)This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Colorado State University - Global: https://csuglobal.edu/CSU - Global's Online Master's Degree in Professional Accounting: https://youtu.be/mLg6UTW0axoContact Nicole Hulet: https://www.linkedin.com/in/nicolekhulet/FULL EPISODE TRANSCRIPT:Adam: (00:00)Welcome back to Count Me In IMA's podcast about all things affecting the accounting and finance world. I am your host, Adam Larson, and I'm happy to bring you another bonus episode of our series. As we focus on IMA's theme of accounting education here in the month of August, Mitch sat down with Nicole Hulet, a graduate student at Colorado State University Global in the professional accounting program. In the conversation Nicole discusses, how she has gone about balancing her graduate coursework, full time accounting work and studying for professional certification. Accounting studies have changed as new skills are needed and finance and accounting professionals are serving in new roles. This episode highlights what students need to do to succeed and differentiate themselves as they enter today's accounting environment. Keep listening as we head over to this impressive conversation. Mitch: (01:02)As an accounting student, what has been the most challenging part of your studies? Nicole: (01:07)I would say the large amount of information I'm trying to learn in a pretty short amount of time. So the structure of my classes right now are eight week semesters basically, and in that we cover one class. And so it's very condensed. It's nice that it's just the one class, but we are having to learn a lot of info really quickly, and then to change topics really quickly as well. And I I'm an international accounting class right now, and I have never done any international accounting or any foreign exchange, you know, currency, and I never worked with any of that. So it's all very new information, but it's so relevant that that's been a challenging, but also really exciting for me as an accounting student. Mitch: (02:00)Now, while you're taking these classes, you know, I know you're obviously doing a number of other things outside of the classroom. So, whether it's something related to school or outside of school, how have you gone about differentiating yourself or, you know, really separating yourself so that you can exceed as an accounting professional in the next stage? Nicole: (02:20)I'd say that partially I work full time. I'm a student full time. I'm just a human being as well. So I do other things in my free time, but I'd say that I try to do, you know, extra. So I'm on the Board of Bovernors for the Colorado uUniversity System. And it's really neat being an accounting student and being on the board of governors, because I think that part partially like that position kind of sets me aside because I think often there's that like stereotype of accountants and accounting students. And so, to, to be in a cool leadership role and people to be able to talk to me about accounting and they always say, I never liked accounting when I was an undergrad or when I was in my business program, I didn't really like accounting. Like how can you do it? And I liked that I'm able to make it enjoyable and also help people understand like why I enjoy it and why I'm doing what I do. And it kind of changes some people's minds on like accounting and how they wish they would have taken it more seriously, but you know, I really pride myself in working on being a professional. I think I'm getting there. I like to consider myself a professional, but being  still in classes I'm, you know, looking forward to having completed my degree. Mitch: (03:49)So you said you're working full time. You're a full time student. You're serving on the, on the board of governors here and now I understand you're also studying for an accounting certification. So with all of this on your plate, you mentioned free time, I suppose, that was in quotes previously. So how do you balance all of that exactly. Nicole: (04:10)I whine. No, I'm just kidding. I have several planners that I of course use, and I have to do a online calendar and then I of course have like a physical calendar and a lot of it is just, you know, time management and allocating, I mean, hour by hour throughout the day, allocating time for me, you know, waking up at a reasonable time, going to bed at a reasonable time. I have to be really focused on, I'd say even each half an hour during the day. So I usually work from 8:00 AM until 5:00 PM. And I take between a 30 minute and an hour long lunch. During my lunch, I'm usually I'm either reading my textbook for my class or working on my homework for that week. I'm, you know, utilizing those times, and it's been a one thing that I've really had to learn is how to switch hats very quickly so that I'm able to be efficient. So I do my homework during lunch and then on my drive home, I have about a 30 minute commute. I take that time to listen to my podcasts or catch up on current events  in the car. And then in the evening I come home and allocate time to eat dinner and make dinner, or we, you know, have something premade and then I'll usually try to train for triathlons also. So I try to do some training usually before dinner. And then after dinner, I go back to homework and certification studying, and I'd say my Sundays are full of certification studying and homework. Then Saturdays, I try to really allocate to, you know, enjoying my one weekend day, and try not to do anything work-wise or a school or certification studying wise. So it's just really being intentional with my entire day, every day of the week, and then planning ahead as well and one of my biggest things to is just upfront being communicative, with my boss and letting him know like how my week's looking when I have board meetings and what it will mean if I have a board meeting that I'll need to work from home, you know, for  that Friday afternoon, just really planning things out and having a little bit of, I'd say some patience with myself too. And, you know, if I'm running late for something, just letting people know and  working things out, but for the most part I've had pretty nailed down to a science and just making sure that I'm making time for the stuff that's important to m,. and also realizing that this is, you know, it's going to be a few years, but it's not forever. So I think just pushing through right now with school, with working and my cert, which all kind of go hand in hand too, you know, realizing this isn't forever and that there is an end date and that I'll be getting my certificate and I'll have my  master's degree and I'll continue working so.Mitch: (07:32)Well, that's really impressive and, you know, I think you emphasized a few different times, the importance of communication. I think that cannot be understated when you're juggling so many different things, working with so many different people, you know, you mentioned wearing a whole bunch of different hats. You certainly have a lot on your plate, but you know, there is an end, right. And you just said it. So what is that end? What's your goal? Where do you hope to be professionally, once all of this is done?Nicole: (08:00)Well, my current role on my business card says I'm an accounting professional. So I, my boss is actually my father. So I work in our family business. We're very small, there's only five of us. We have another, accountant and then my dad, we've got, you know, our front desk gal. Well, and then, my mom is the office manager and then myself. So I'd say that's another role that I kind of have to handle kind of differently having a business relationship with my dad. And ultimately my plan is to become the business owner, you know, with my certificate, I'll be able to do that and from there, I don't think necessarily being a business owner and having my certificate is the end for me. I am constantly doing things to try to improve myself personally and professionally. So right now, my position with the board of governors is kind of my professional development role, but I'm hoping to join, you know, a chamber in the future or, you know, things like that. I try to get, you know, stay involved with my community, but yeah, that would be my ultimate goal. Be a business owner, have my certificate and just keep growing as a professional. Mitch: (09:16)Well, you just mentioned, you know, being involved in the community and things like that will certainly help, but the next question I had for you is if you were to pursue being a business owner and, and that's, you know, at least the first goal, how do you plan on developing those business skills? You know, I know you were talking about studying a very specific accounting skills, but obviously  say there's more to running a business, you know, strategy planning, daily operations. How do you gain that kind of experience to handle the, from day to day and then longterm? Nicole: (09:50)You know, I feel pretty blessed to be able to have my dad as my dad and my boss, but he's also an incredible teacher. So he's a big influence in that realm, and he's kept, you know, kept me pretty apart of the business decisions. I do think that my time with CSU Global, because we have a lot of like organizational leadership and business management programs that I will likely pursue, from an educational point or from an experience like experiential point, I think I'll continue really watching my dad. Obviously my investment in our company is a little bit different than say our other accountant with my intention to, to take over. So with some of the clients, you know, he's been slowly kind of working with me on how to communicate and decisions that he makes, you know, when not that this is on the table, but, you know, if hard decisions have to be made even, even a silly decision, like, are we going to move our office out of Boulder? He's been good about communicating with me, about why he would make that decision, and we also sometimes make recommendations for clients for business decisions. So a lot of involvement I would love to, you know, pursue another degree in business management, just, I think it would be important to have, and I think the educational piece, how, how well my program is going and the accounting, the Master's in professional accounting has been. It's so much less about the numbers, and it's so much more just about accounting as a whole, that I imagine the business side of some of the CSU Global programs, it would be just exceptional to be a part of and to have as a business professional. Mitch: (11:45)That's another really impressive perspective, and I can certainly appreciate, you know, your eagerness to learn and, you know, lifelong learning, continuous learning  that's all something that, you know, we at IMA are a big proponent of, and obviously why you know, we have conversations like this, so we can discuss different elements that go into an accounting career. And, you know, as I said, we are I to focus on a little bit of the accounting studies and the student perspective for this conversation and part of our theme throughout the month. So, you know, if you were to offer up some recommendations to current or future accounting students, you know, through your educational experience or professional experience, you know, what can you offer to some of our student listeners to allow them to better prepare for what today's accounting environment really looks like? Nicole: (12:38)That's a big question. I would say for future students, it's really important to find a program that fits in your life. So my program was CSU Global. I would not be where I'm at without the program through CSU Global. Just the flexibility, you know, it's affordable. It lets me, you know, get really good quality education on my own time, but there's still accountability. I still have a professor that I'm speaking with. And what's really neat too, is a lot of the professors from their certificate side, they're all, they all have certificates, and, you know I have a couple of lawyers that were professors and they all are looking for resources for us as students, and so it's super important. What I've done is taken advantage of some of those free resources that our professors are offering. just, you know, little webinars that you can join that my current professor has offered, which has just been amazing in getting prepared for current students. I think it's just as important to make sure that, you know, the program's working in your favor and also, I think it's the program that I'm currently in, I am finding that my investment is different. than You know, undergrad I feel like everybody was just trying to get by graduate and get to the next step. And now it's, so it's such a different mentality for me and where I genuinely not only do I need to learn these things, but I want to learn these things because I genuinely want to be the best professional that I can be. And so I think, you know, time management and just finding the right program, being in the right program and just really realizing the investment of your time and of course, you know, money with the program that you're in. I think it's just really important to know and take advantage of resources that are there even, you know, even if you're planning on doing your certificate in a couple of years, educating yourself as much as possible ahead of time, I think just sets you up for better success. Closing: (14:48)This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Shaila Bettadapur: https://www.linkedin.com/in/bettadapur/FULL EPISODE TRANSCRIPTAdam: (00:05)Welcome back for episode 76 of Count Me In, IMA's podcast about all things affecting the accounting and finance world. Technology had previously changed many roles and forced management accountants to upskill and grow at a rapid rate. Then recent events have caused the accounting and finance profession to evolve even faster than ever, but that only leads us to believe that the future of work will look even more different. In this episode, Mitch talks to Shaila Bettadapur, Corporate Treasurer and VP of Investor Relations at Mohawk Industries. Shaila is a global executive with deep knowledge across multiple disciplines, industries and geographies leading to an informed perspective on what the future of work will look like and what finance leaders need to do in order to best prepare their organizations. So let's head over to the conversation and hear what he has to say now. Mitch: (01:01)So we're at an interesting time now where the future of work really came at us pretty quickly, but I'm just curious if you have any perspective on what the future of work may still evolve into and, you know, what does that really look like in your eyes for the accounting and finance professionals? Shaila: (01:19)I think, even, you know, pre COVID, you were starting to see, changes in the workplace overall. Just as, you know, telecommunications gets better, AI gets better, and so on. And of course yesterday you saw a news article where Facebook and others were talking about certain people working from home or working remotely kind of forever. Right. You know, we'll see if that actually happens. But I think, you know, so even pre COVID, you know, let's dial back the clock a little bit. If you went back, let's say  30 years or even 20 years for that matter, what an accountant might do or what a treasury person might do, is materially different than what they do today. A lot of what people did in those days, which was really, you know, getting the data, you know, recording the data and so on, which is what a lot of data entry , you know, kind of basic stuff is all automated. So for example, as the treasurer I had, we installed a treasury workstation close to eight years ago now, which automated a bunch of these things, and allowed, my people, which, you know, have it fairly lean staff, allow my people to, do higher level analysis and actually stuff that matters, as opposed to just data manipulation and so forth. I think that's true on the accounting side. I think that's true on the legal side, you've been reading a lot of stuff about how, you know, people coming out of law school or having a little bit more trouble finding work, because you know, a lot of stuff is being done by paralegals. A lot of stuff is being done, through AI simulation, right? My computer's right. You don't need to go to a lawyer to do your estate planning anymore and so on and so forth. So I think to a large extent, the middle starts to go away. That led to what I call the middle, being the, you know, where you're not really adding value, but you are, basically doing something that a machine or a computer program can do as software, it gets better as artificial intelligence gets better. That's going to happen more and more. Mitch: (04:11)So that's really interesting perspective because, you know, it leads us nicely into what exactly have you noticed as a finance leader, as far as changes to your, whether it's day to day responsibilities or overall responsibilities because of AI and everything that has changed in the work environment, you know, how have you realized some of these changes before they actually become wholesale changes like you just referenced? Shaila: (04:40)I think, the mistake that people make, is thinking about finance as a numbers oriented exercise. It is true that you need to understand the numbers. That's true. But again, if you dial back the clock, you know, 30 years let's say, a chief financial officer, and by extension everybody who works with the chief financial officer, just focused on the numbers, right? Not so basically, okay, the numbers are this and this X and Y, but less about why those numbers look that way, and what does that mean for the future? Because at the end of the day, the past is only as good as, you know, I mean, it's great for a topic of conversation, but it's only good if it informed you of what will happen in the future and therefore, what kinds of decisions you have to make, going forward. And that I think is the biggest difference. So if you look at the role of a CFO today, it is, it is more around strategy and the decision making process. Yes, you have to obviously, do the, do the accounting work. You have to obviously do the reporting that you have public filings, you have all of these things. These are all necessary things that you have to do, but they are not sufficient, to be a good CFO or a good treasurer or a good controller. It's really about what should I do next? How should I behave next? And that's really the key. And so the extent to which, you know, you are focused on just pulling numbers and putting numbers down on a page, but not being able to translate those numbers to a broader audience, that is a flaw and that will get exposed rather quickly. Mitch: (06:55)I like how you just mentioned, you know, what should I do next? How should I behave? Because from our perspective, you know, the foundation of the management accounting profession is really rooted in ethics. And when you have a number of decisions to be made as a finance leader, and there is so much data at your fingertips and there's AI to be aware of. Ethics becomes a very strong part of your job, I would assume on a day to day basis, especially longterm planning. So, you know, as far as the future of work, your role, what role does ethics play in the behavior of you and your organization? Shaila: (07:33)Well, and so I don't think that this has ever changed why ethics is huge. And I would go so far as to argue that, the rise of the whole Western world, is, is built on, you know, fundamentally on ethics, because in the end, contracts can only protect you to an extent. In the end when you do business with someone, or when you enter into any sort of agreement with someone you are, and you're doing so based on trust, based on your counterpart acting in good faith, and conversely your counterpart is doing that, assuming that you're acting in good faith, at the end of the day, if you don't have that, then it's very difficult to do business. And so, I would argue that ethics, if you want to call that ethics, but being open and transparent and ethical as you put it, is the foundation of doing business well and doing it properly, without which nothing actually works. So from an accounting , you know, you know, treasury and what we report to the banks, what we report, you know, to, you know, the, when we go raise money in the in the bond market, you know, all of those need to be honest, they can't be that you are not going to be, you are not going to do well if you are deceptive, particularly deliberately deceptive, because, because frankly, people aren't going to trust you and people are not going to lend you money. And if they do, they're going to charge you a premium, and so all it does was raised the cost of everything and that in the end, doesn't help you. Mitch: (09:38)So with everything we've talked about so far, I'd like to kind of wrap things up by offering some kind of advice, or, you know, your perspective on this, going into the future of work, the changing role of finance and finance leaders, and again, rooted in ethics. How do you go about preparing your team, yourself, maybe others that you work with, mentees, things like that. What's your strategy for bringing everybody up to speed on what's needed for the industry today and the future? Shaila: (10:11)I try, with my team and again, I have a fairly lean team, but even if I didn't, I try to give people as many experiences as they can handle, because I think the more things that you're exposed to, you know, the better off you are. And by the way, you know, you're going to have to learn some of these things, you know, going forward, I'm not going to be around forever and, you know, you want to learn these things. It is not in my mind, a function of, per se, what your training is you know, I believe, and I've always operated this way that, if you have the energy and if you have the gray matter, and if you have integrity or ethics, since you've been talking about that, I believe that I can teach you anything. I believe that you could probably do anything because none of this stuff is rocket science. We can all learn it, you know, there are certain rules and things like that, but these are not difficult things to learn. You just have to have the willingness and the energy to do it. And so that's what I try to do. I try to give people as many different experiences as I can get. And even if they're starting from ground zero, I am confident that, you know, I can teach them something or somebody else can teach them something and they can learn that. The extent to which you can't, or are unwilling to do. So that's the limiting factor that you're limiting yourself at that point. And so, but I think it's a good way to sort of segregate out, you know, who's gonna make it, and who's not.Closing: (12:13)This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession, if you like, what you heard. And you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Linda Devonish-Mills: https://www.linkedin.com/in/linda-devonish-mills-cma-cpa-cae-mba-88534610/Contact Derek Fuzzell: https://www.linkedin.com/in/derek-a-fuzzell-cpa-cma/IMA's D&I Toolkit: https://www.imanet.org/about-ima/diversity-and-inclusionFULL EPISODE TRANSCRIPTMitch: (00:04)Welcome back to Count Me In IMA's podcast about all things affecting the accounting and finance world. I'm your host, Mitch Roshong, and today we have another special bonus episode relating to diversity and inclusion in the workplace during these challenging times. My cohost Adam spoke with IMA's Director of Diversity and Inclusion, Linda Devonish-Mills, and Derek Fuzzell CFO at a Federal Credit Union and Chair of IMA's Diversity and Inclusion Committee, Linda and Derek share their perspectives on recent tragedies. What that means to organizational leaders and its employees, and what IMA is doing to support these initiatives. For genuine and informative dialogue keep listening as we head over to the group's conversation now.Adam: (00:52)The killing of George Floyd has shaken the US and many communities around the world. We are sickened by this tragedy and many peaceful process, as well as riots have happened as a result. Can you share a little of your feelings and how this has affected you? Linda: (01:12)Sure. It's affected me, in so many ways where I shared some thoughts a couple of weeks ago with my, teammate and, you know, I was surprised in terms of how my emotions got the best of me. So, as to say time heals all wounds, so at least I can talk about it now without a whole lot of emotion, but what really upsets me about it is that, you know, when I think about it bad enough that, my parents, as I was growing up would talk to me about their struggles, their personal struggles with racial injustice. And it was like if it was a preparation for what they thought I would go through, and then unfortunately I have my own theories, experiences and yet, no, I think the saving grace for whatever it's worth that, you know, as I've gotten older, you know, to a certain degree, with certain things still, you know, coming into play with personal interactions, I may have with people I have gotten unfortunately accustomed to certain interactions that I've had with people I've gotten, you know, to the point where I've gotten numb over it, where it just doesn't affect me anymore. And just to position that as long as it's just affected me and not my daughters and their generation in  general, I'm good. Whereas when my daughters were growing up, they could not understand since they grew up in a diverse population, in the town of Teaneck, New Jersey and went to schools that have diverse student populations, they could not understand why I seem to be so racially conscious. You know, I was always talking about, racial issueswith them and they just could not understand that. So now what really hurts me is that they're grown young, successful women I may add, and it seems like it's like they're playing catch up now in terms of how it's affecting them. And with my oldest daughter now being the mother of my grandson for her to say to me one time that she is frightened to raise an African American boy in this world. So it just provokes, you know, anger side of me that now is affecting my family and, you know, us to have conversations that we shouldn't even feel the need to have conversations about. So, you know, so that is where it really comes to the core of hurt for me for anger, but again, you know, time does heal all wounds and, you know, the way I'm trying to look at these thing now is what can I do personally to contribute, towards part of a solution and just have the mindset every single day, more so than ever of being hopeful, instead of relying on hopelessness. Derek: (04:45)You know, I would just say my perspective on this, on this question is a bit different. You know, I'm approaching this as a Caucasian male, you know, living in the United States. I understand from experiences of my friends and even some experiences where I've been in situations where I've seen quite frankly, police treat people who are Black or Latino or other race, other ethnicity very differently than they've treated me in that same situation. You know, I'll say it really, it really upset me. I thought we had come a lot further as a country. I had hoped, you know, this reminds me of a lot of the Rodney King issue in the early nineties in LA. And one would hope that we had progressed a little bit from the nineties, and I'll be honest, this and several of the other incidents that have led up to this over the last decade have really told me, no, we haven't progressed as far as I would hope. You know, I think that what I can see and where I do have hope in this situation is that people's response is very different than the Rodney King situation. Rodney King seemed to be very isolated to the Los Angeles area that people seem to pick up the banner and while news coverage picked up what was going on in LA. It wasn't the mass protest that you've seen throughout the United States and elsewhere for that matter. You know, what, what gives me hope in this situation is that there seems to be a shift in mindset of people, both Bllack and White and Latino and Asian who are willing to step in and finally stand up for creating a system of equity within our, in our criminal justice system, which wasn't there before. In the nineties, you didn't see that even six years ago, you didn't see that as events, you know, foiled, out in Ferguson, Missouri, you just didn't see that same kind of response, and so I think I am happy to see that people are taking this a lot  more seriously, but it does disappoint me that we are still having this conversation about police brutality, especially with the African American community in the United States here 30 years later. Adam: (07:04)Thank you both for being open and honest with us, and I'm sure that many people listening to this conversation have very similar feelings and many of them may be even leaders. And if you look at an organization, what can leaders of organizations do at this time to support their workforce and be mindful that people are going through the same, having the same feelings that you guys are feeling even themselves are going through those feelings, what can they do to support their workforce during this time? Derek: (07:34)I think it's important as, as we consider our workforce, you know, not every organization is going to be as racially diverse as others. I happen to work for a very racially diverse organization that has a huge tie to the Hispanic  community, but even within the Hispanic community, you, you do have a Black, Hispanic community and that White Hispanic community. And we have made it a point within our organization to reach out and listen to every single employee. Give them the opportunity to speak to us, to come to us, to talk with us about their frustrations, to understand what may be impacting them. I'll say one point of personal reflection on this was as DC started to impose curfews, and some of the curfews happened pretty early in the evening, and they lasted until pretty late in the morning, comparatively, I was often concerned about, can I get my employees out of the office and back home in time to avoid curfew, to avoid interaction with the police to be, to be blunt. One of my employees is a gentleman from the Dominican Republic who is Black, and my concern really was what will the police interaction be if he's caught out before or after curfew has expired? How, how will this be? How will this play out for him? How do I help support him in this situation? And so I sat down and had a frank conversation with him to say, I'm concerned, I'm happy to hear your perspective, but please, you know, for me, at least I would like for you to get home before curfew begins, I would like for you to come in after work and not even chance, it don't be a minute early, don't be 10 minutes early. Let's not play that game, and I think that that, that in and of itself is a little concerning that I have to have these thoughts or this conversation at this point in time. I think the things that organizations can do is truly commit themselves to, to diversity and inclusion initiatives and equity initiatives for that matter. And not just say that they're going to do something, but actually put their money where their mouth is, put their public face forward. That says, this is what we are doing, and act in a way that really resembles the words that they're putting forward. Linda: (09:57)Yeah, actually it's times like this at this point in my life in general, I like to embrace, younger generations, as my role models. Getting to their, you know, mindset in terms of, you know, what excites them in general, even before these series of events happen, you know, what appeals to them when they are considering, employment, at future prospective employers. So, you know, even amongst, IMA’s Diversity and Inclusion, you know, community, it has been talks about, how we can make, IMA, as an organization that will be attractive to young professionals in terms of what we could have on our website, in terms of, positions, as it relates to diversity and inclusion, and probably will have to eventually refer to it as diversity, equity and inclusion. We've had those, you know, conversations as well. So based on conversations that I've had with people from a younger generations specifically, you know, what they're looking for is empathy, you know, from their employees, as it relates to these, you know, unfortunate series of events. You know, a refused to work for not only employers, but, you know, direct supervisors that come across as if not only they don't care about what's going on, they're not trying to even educate themselves in terms of how they support their subordinates. You know, that is like the absolutely first red flag that would come across to young professionals now. And they just have no tolerance for it where, my, daughter-in-law actually informed me about one of her friends personally felt had to make a decision recently take the dust off of her resume to get back on the job market, because she just has not seen the support, not only from her employer, but her direct supervisor where her direct supervisor pretty much told her that these issues, she just cannot relate to. You know, so that was unfortunate that she had that experience, that particular young lady and, you know, she just could not work, someone under those circumstances with the lack of empathy. So I say all that to say is that I think organizations have to do whatever they can, whether it's, formal training, which quite frankly, I have a biased opinion on that. I think, you know, formal training may be good in the long run, but right now, and I'm glad IMA, is allowing staff to conduct such a informal farm next week that, you know, I think organizations needs to set up their environment where employees can talk very openly about their raw emotions. And definitely when you're working for a global organization, yes, first and foremost, you need to hear from the African American community, but I do see this in a lot of respects as a global issue as well, because, if I was travel right now to international countries, I would expect, even from those countries, some type of concern as how the US is dealing with these issues and how they can help. So, you know, as I tell people in preparation for, the conversation that we're going to have among staff next week, is that just important for those that have reached out to me and said that they just want to sit back and listen, because I think part of the solution is doing just that By just sitting back and listening and hearing firsthand what some of your colleagues are going through in order for you to play an integral role with, a solution. Adam: (14:29)So I was reading an article the other day and, it was, it had been interviewing some of the people who had been, on the front lines, part of the peaceful protests, they, and they were expressing just frustration and just burn out, you know, this is very taxing as you consume everything that's happening, you know, and another, another aspect of being a manager is, you know, how do you address the accessibility and even mental health of your employees as they deal with these issues? Linda: (15:00)Yes. So I can say that I can speak to that personally and want to give an opportunity to  applaud my, supervisor at this time where she really has appreciated what I did with her, online, offline, and, and appreciated her honesty that, prior to me sharing some of my thoughts with her and with our group as a team, that she did not know how to approach me. You know, I think some people, also hung up on being more sensitive and not knowing how to approach the subject, thinking that would be more upsetting to talk about it, but not realizing that for some, it's important to talk about it. When I share my feelings, I experienced emotions that come out of nowhere that day. That obviously was being built up, even way beyond and series of events occurred, you know? I felt like, all the frustrations that again my parents experienced, I experienced and now my daughters are facing it, all overwhelmed me that the day that I opened up with my feelings and, you know, even under normal circumstances, I'm probably the worst with, not takingin advantage of our generous, you know, package and even, you know, if I need the services, you know, not really taking advantage of it. And you know, when I am on vacation, I am the typle that will still  check emails, not respond to them, but I always feel like I need to know what's going on. And I would say the first time in many years, I really took a mental health break from work. And I was proud of myself where, I literally shut down my laptop. I did not check emails that whole day. You know, I had gotten some text messages about work related stuff, and I just kindly told those people, I'm off today, you know, do the best you can to resolve the issue. I'll talk to you tomorrow about it. And I still, and that was over a week ago, and I feel like, you know, just like most of us, we have, feelings of being overwhelmed with work. I'm handling it because I took that day off. So, I think that's the best gift, that, employers can do their employees right now to remind them and just assure them that if they do decide to take the date off. They will not be penalized. It will not be looked at differently. They won't be looked at as being less productive because in the long run, any smart employer would know that you want a certain level of productivity from their employees, they need to encourage them to take time off. Derek: (18:18)I think to add to that is for an employer from the employer side, what you have at your disposal is your managers, your managers on a day in and day out basis should be getting to know your employees. You should get to understand where they're coming from, what their perspectives are. I think that if you've done that research already, if you've done that work and getting to know your employees, you know, who may be a little bit more vulnerable in this time, and it doesn't hurt to reach out to them and check in to make sure that they're okay, that they're processing everything in a healthy way. You know, quite frankly, this situation along with the Coronavirus situation is giving a lot of people, grief and anxiety and loneliness. And just having that conversation, you know, maybe in a virtual capacity, but having that conversation with your employee is a huge advantage of how to deal with this from an emotional and mental standpoint. You know, it's important to look at things like taking a day off, or maybe it's taking a couple of days off. Maybe it is looking at your employee assistance program and referring them to call someone that there are people there to help. I think from the employee side, the things that we have to do for ourselves is if we are in facing that challenge, it may be difficult to ask for time off. It may be difficult to ask your boss for leeway on something, but maybe to delay a project or delay a deadline. But I think that in the long run, we are better off if we actually identify where, when we're at our breaking point, whatever that may be, you know. This situation, I think compounded with, again, the pandemic that is going on has created this multitude of emotions. You know, I I'll say personally, there have been times when I'm at home watching a movie that I think is, you know, just it's fluff, it's, it's easy going and it's not going to affect me emotionally. Then about halfway through the movie, I find myself almost in tears and I'm like, well, why am I having this response? And I think it really is because of everything else that's going on in our lives. So finding ways to process that in healthy ways, you know, I, I can say that there are people out there who may, go to eating too much  to binge eating into food, but let's not do that necessarily. There, there are healthy ways to deal with any these situations. And I think first and foremost is finding that support network that, that circle of trust, those people that you can talk to.You know, it may be your parents, it may be your siblings  it may be your children, or it may be just friends who've had similar shared experiences. You know, what I have found to be helpful for me is to reach out to that support network. And I'll say I've even expanded my support networks through this pandemic, just because of the social distancing, where I would normally get those social interactions, otherwise. I've expanded that support network. And a lot of that support network has also been just me listening. Let me reconnect with friends from high school, who quite frankly, are having a very different experience. You know, that they're personalizing this a lot more. I had a couple of friends from college who moved to Minneapolis, and I just checked in with them to say, how were you dealing with this? This is happening in your backyard. You know, for them, they are White Americans. They're experiencing this in a very different mindset, but having something like this happen so close to home for them was troubling. And I think just hearing how they were processing, it was healthy for me. It helped me to process my emotions and what I was feeling about this as well. Adam: (22:02)So as we try to find our way forward as people, as organizations, I think one of the best ways for us is to find ways to hire, to make sure your workforce is diverse. Do you guys have some tips that the hiring managers can and managers can have, and when they're trying to go this route? Derek: (22:22)Absolutely. I would say first and foremost is if you see in your, in your application pool, that you are not getting a diversity of candidates, maybe even diversity of experience, you should ask yourself why. There's probably something that's underlying there. That really is the root cause. For some businesses, it may be that they have a bad track record. There are businesses in the country who have had bad track records with either the African American community or the LGBTQ community or others. And so people in those communities do not want to work for those companies. And I think it's on those companies that they really need to rebrand to re-focus their attentions, to help actually make a difference in those areas. You know, I think a great example of that is if you take Cracker Barrel from the late 1990s, they had issues with LGBTQ community, but in the early two thousands they actually took proactive steps to challenge their, their perception in that community. They went out and hired a lot of LGBT consultants as well as managers to help manage their shops. And I think that that's important for them to make that change because it's only once they made that change, that they started to actually get traction from that community. And I think the same is probably true of the Asian American community, the African American community, the Hispanic community and others. What I think is also important though, is as a hiring manager, sometimes you need to find out where those diverse candidates are looking for jobs. One thing that I was very proud of in my prior employment, I was hiring for a Senior Financial Analyst and it wasn't just posting on LinkedIn and calling you today. I wanted to ensure that I had the most diverse pool of candidates that I could find. So I approached organizations like the National Association of Black Accountants. I approach Ascend, The Asian American Business Professional Organization and Alpha, The Association for Latino Professionals for America and posted on their job boards so that I could get more diverse candidates in my pool. And I think that is part of it. We, as hiring managers have to take proactive steps. I think the second part of it though, is we really have to look at our own biases when we look at resumes, when we look at applications, when we look at whatever it may be, whatever data is in front of this, or even in the interview, you know. There was a study done by Harvard University Professors who said that if you have four candidates on an interview and three of them are male, and one of them is female. The female only has a 5% chance of being hired. Statistically she should have a 25% chance, but the fact that you do not have a diverse pool of candidates that you're interviewing plays negatively against that female candidate. And I think that as we think about building our applicant pool and building our candidate pool and interviews, we really have to start considering, is this a diverse cross section of the applicants that are there? And again, if you're not getting diverse candidates, you need to ask yourself why. And some organizations, it may be history, but some organizations that maybe they're just not advertising in the right space. Maybe they're not getting that word of mouth from their employees. And so they should reach out to them and ask them what they could do to better, you know, get candidates from those communities, whatever those communities may be. Linda: (25:50)And, I don't know if I can add so much to that, because that was a great overview in terms of what organizations can do. But, what I would say is that more than ever, I think organizations in general need to reach out to young professionals and I would say budding young professionals. And that is to start with, you know, doing conducting more outreach, you know, having conversation while, you know, budding young professionals are students in college. I think part of the problem is that, you know, young budding professionals, they're not really sure what career path they want to pursue. Some professions may look more appealing than others. And that may be just lack of information in terms of how some professions can be more appealing than they actually are aware of in terms of what options they can pursue. So I think a lot of these employers need to make their presence known at college campuses and have, you know, multiple touch points with both faculty and students, realizing that, faculty are the ambassadors for students, it's just like, you know, whatever, you know, students are hearing from their professors, in terms of career paths, more than likely that's what you're going to go with. So yeah, so I feel like organizations just have to make more of a connection with, you know, college campuses in general, both to faculty and students. Adam: (27:37)So regardless of how diverse an organization is, the reality is, is that there are going to be people who are bigoted are, have racist thoughts and, and are just, are just straight, straight up mean to people, to others. What should someone do, an employee do, if they experienced that at their organization? Linda: (27:59)Yeah. And, again you know, I defer to the theory one size doesn't fit all. I think it depends on, you know, what you're actually witnessing. And I would say in terms of, you know, how you would handle it based on your personal background, where, as an African American female, and unfortunately I've seen firsthand how racism and bigotry, you know, plays out. I think if I was to see it right in front of my face, I would probably try to have a situation at hand, and inform the vendor directly, you know, how they are aggressive, but the average person probably wouldn't be comfortable with that, worried about the repercussions from a human resources perspective. So, I think, you know, as part of a training for all employees, you know, there should be some type of guidelines that, you know, we would get from, human resources in terms of how we would handle such situations. So this way, if it has to be addressed, employees won't feel like they're violating any rules or regulations because they are bringing it to the attention, whether it's human resources, professionals or us confronting, the offender directly. So it probably has to, you know, be set up in terms of training sessions in terms of how to you know deal with those types of very sensitive situations. Derek: (29:54)I think that individually, I think you should try to use the resources that are available to you. If that's going through the human resources pipeline, maybe there's a hotline that you have that you can give an anonymous tip, maybe talking to your manager or to the manager of that person. I think that those are the formal processes because you want to, quite frankly, you want to document this in the best way possible. The reason why is their actions violate Title Seven. I mean, just plainly. They violates Title Seven. It is against federal law based on race, and I think that first and foremost though, is creating that paper trail. You want that paper trail, as in my role, I also see oversee human resources. So it's not just, you know, the finance and accounting side that I have to put on. I also have to put on the HR hat and I need that paper trail, because if I'm going to take action, I need statements from employees who are impacted by a situation. I need the evidence, whether that's emails and, you know, quite frankly, the bigotry takes a lot of forms. It's not just racism, it's not just misogyny or homophobia. It takes a lot of forms in the even, I'll say there's a lot of things that happen that people say, oh, well, that wasn't that big of a deal, or they didn't mean it that way. Even those things need to be documented in the process. And I think that you, as an individual who either sees this bigotry or experiences this bigotry in any way, shape, form, fashion, you have a, an obligation for your company to document it and helping that process. I think from the company perspective, though, you have to create a culture that does not accept misogyny or homophobia, racism, or bigotry in any form. You know, it's, it, it has to be set from the top level of the organization. If your C-suite does not agree that this is a problem, then quite frankly, you're never going to get further down than that. People are going to start crafting their own opinions. And I think as a CEO, you have to craft your organization around this mindset that this is not acceptable and ensure that your senior leadership team, your C-suite buys into that and they need to ensure their managers buy into that. And you need to, when situations arise, you need to make examples of those individuals who are creating a hostile work environment for other people around you. And it could be harassment. It can be any number of topics that we're talking about here, but I think that it is an imperative for companies to address this and say, this is not acceptable behavior. I think as part of that, though, again, it is management's responsibility to have those open channels of conversation with people throughout the organization. You know, in my role, I have skip level meetings with my indirect subordinates. And I think that that's important. I hope that they would feel comfortable bringing these kinds of issues to me. But I also like to periodically set up meetings, informal meetings with people who aren't even in my reporting chain, so that I can have conversations with people outside of that group, who may be willing to say, well, you know, I heard this is going on, or really confront situations for some people, it may be very uncomfortable to confront racism or misogyny or whatever kind of bigotry is being portrayed. It may be very difficult for them as a bystander. Maybe they feel vulnerable. Maybe they don't feel empowered to speak up, because they're concerned about where their manager might be on this topic. But by creating these informal channels where people can come to you and say, I saw something, this doesn't seem right. You actually create the opportunity for a conversation and you can move those people, those kinds of people, those people with racist mindsets out of your company, because you don't want them interacting with your customers. You don't want them interacting with your other stakeholders, maybe your vendors or other employees, quite frankly. And it's more important for you as a manager of an organization with fiduciary responsibility to take care of the organization, allowing those people to stay in your organization does not help your organization succeed in the long run. Adam: (34:18)So speaking of tools for organizations, can you just share a little bit about the new D&I toolkit that IMA is released? Derek: (34:24)Absolutely. And, you know, thank you for asking about it. I think that it has been something that both Linda and I are very proud of and the accomplishment of it. This D&I toolkit is really designed for companies who are either just beginning their D&I journey or for companies who are already on a D&I journey, who need to assess where they are. It really provides some key practices, some best practices that are out there, including the use of KPIs to really understand how you should be managing your business from a diversity and inclusion perspective. I think that what is wonderful about this toolkit is that the primary author of the toolkit is a D&I professional, who is also a person with an accounting and finance background. this person transitioned from an accounting and finance background to this D&I role that they're currently under their company, her name's Carmen Bailey. And she absolutely understands where accountants mindsets are. And this is a great tool, not just for HR professionals or for diversity officers, but it's really a tool that's designed for business stakeholders, wherever they are in the organization. Again, when you, when you have an accountant or finance professional who is writing something, they're going to take a very different approach. And I think that that's what really has made this toolkit so successful is that it is a multifaceted approach that is all encompassing and quite frankly, can be used by any size organization. Organizations, as small as 10 people can pick this up tomorrow, or 20,000, 30,000 employees can pick this up tomorrow and they can find value on it. Linda: (36:03)I feel that IMA is slowly but surely becoming a thought leader in the area of diversity and inclusion. And the reason being is because of the release of the D&I toolkit  where I participated  in a media interview earlier today, where I was describing the fact that I struggle with a lot of, you know, people that are appointed and become diversity and inclusion offices or professionals, is that you don't know where to start. And if you worked, the third of outlines for that employee can embrace, for how to start a D&I  initiative. You're not going to find something out there, you know, beyond maybe formal courses, as it relates to diversity and inclusion, but actually, you know, start the diversity and inclusion initiative, maybe beyond a formal checklist, there's not much out there. So the fact that I am a not only is offering such a resource, but offering it as a free resource, not only to, members within the management account profession, and as Derek said, you know, this is a toolkit that everybody in business appreciate as going through the journey with the organization, to develop initiatives. Closing: (37:35)This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Shifra: https://www.linkedin.com/in/shifrakolsky/ FULL EPISODE TRANSCRIPTAdam: (00:05)Hi, everyone. Welcome back for episode 75 of Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson, and I'm pleased to introduce you to our featured expert speaker, Shifra Kolsky. Shifra is the Vice President and Assistant Controller and Finance at Discover she is responsible for external reporting, the SOX compliance program, accounting policy, corporate accounting and financial systems. In this episode, Shifra talks about the value of an effective rollout and what all aspects of an RPA implementation look like. Shifra  launched the finance RPA team in 2018. The first RPA team at discover. So to hear firsthand experiences and actual applications, keep listening as we head over to the conversation now. Mitch: (00:56)So Shifra, you know, we've had a lot of episodes here talking about artificial intelligence, RPA, and from your experience and you just, how you answer questions regarding these topics. Can you first start off with telling us how is RPA different from AI? Shifra: (01:13)So RPA is robotic process automation, AI artificial intelligence, and the main difference is that the way I think about it as the bots are a little bit stupid. So AI tools can and learn from, the different data that they're exposed to and they can develop more sophisticated responses over time. Bots can strictly do whatever it is you tell them to do so they just follow instructions, nothing more. Mitch: (01:45)So as far as following instructions, you know, I know you are in finance and accounting, right? VVce President Assistant Controller here at Discover,  and again, your perspective, what are the best type of tasks for these bots to perform? Shifra: (02:00)Bots are great at doing simple, repetitive tasks where you can give exact step by step instructions. Some of the examples in controllership might include things like pulling reports or setting up journal entries based on specific data fields in that report, preparing reconciliations where the bot would  compare data from one source to another source and create a list of exceptions. So again, all simple, basic repetitive tasks, but we have a lot of those in finance and accounting, and so they're very helpful to us. Mitch: (02:38)And being in finance and accounting, you know, a lot of people probably outside the function would look at this as maybe a cost cutting measure, right? It's, it's a way to kind of eliminate some of the human tasks that are out there, but from within the function and the organization as a whole, really, how do you get in to get people to understand the benefits of these bots and RPA? Shifra: (03:04)Yeah. So when we first launched our RPA program, we were not looking at cost cutting, and we were looking at, ways to become more efficient and free up people's time to be able to do more high value work, to kind of critical thinking things that you need a human to do and so when we took on this program, we started by, we asked people to tell us about the things they hated doing, the things that they found, kind of mind numbingly boring. And thought let's take that list and see if we can get a bot to do those things instead. We also made it very clear to people that it was about shifting people to doing the higher value work, the critical thinking, the analytics, so that people weren't focused on the, Oh my goodness, the bot is  going to take my job. Building a foundation of trust that it really was centered around helping people, was really important to get buy in and to get people engaged. We also enlisted one specific team at the start, to be guinea pigs for everyone. So they test it out. They were the first ones to have a process automated, and they were specifically selected because they had two clear qualifications. One, they had a whole bunch of tasks that were repetitive and easy for us to automate the box. But the other thing they had was a sort of general sense of excitement about the program and the possibilities, and so they were able to really carry the message and they were able to help the bot developers understand things quickly. And then they were also able to convey their enthusiasm to other people as they started seeing the results. And so having those natural cheerleaders or business champions was a really effective way for us to build some momentum around the program. Shifra: (05:11)And what were some of the recognizable benefits of implementing this program? How did it ultimately impact your team? Shifra: (05:18)So there are a number of different ways that this has helped our team. You know, on the simplest level, it changed the energy. I mean, it got people excited and really thinking in different ways. Our team has long been focused on continuous improvement, but this is really taking things to a different level and helped folks think more creatively about the things that we can do instead of feeling hampered by the things that we can't do. You know, so that's one element of it on the people's side, but frankly, it's also allowed us over the course of the last two years to redeploy about 10% of our headcount in the controllership team to take on new opportunities within the group. So this furious focus on automation has really enabled us to keep up with the growing needs, that are coming at us from all of our business partners and, and keep up with those demands without increasing head count. Mitch: (06:25)One question that I hear a lot when we start talking about RPA is the length of time it takes actually to implement the program. So are you able to share how long this whole process took from the analysis through identifying what people hate until you were able to recognize the benefits and get these cheerleaders for the program? Shifra: (06:45)Sure. I would say for us, the research we did before we jumped into it probably took longer than getting it moving once we started. So we spent a good couple months really talking to a lot of other companies and understanding, you know, some of the things that worked for them, some of the things they wish they'd done differently. We spent a chunk of time looking at the different tools that were available and deciding what the best tool was for us. And then we invested in, recruiting and training some folks, and we did all internal recruiting. We thought that it was smarter to take people who understood the business and understood the business processes, and teach them how to use the tool rather than taking somebody who knew how to use the tool and try to teach them the business. So we spent a couple of months with all of that kind of upfront research and, and training. And once we got into the training it was fairly quick. So depending on the nature of the process that you're trying to automate, things, can we fairly quick, if you know how to use the software and you understand how some of the different connections work, okay. You can get something going in as little as a week when you're first starting out. You're more likely looking at things taking between eight and 12 weeks for a process. And again, probably depending on the complexity and the number of different, systems the process might touch. But we had our first process in place within about 10 weeks  and built on things from there. And one of the things that we've seen is over  time, the more processes we build, and as long as we maintain a focus on kind of building reusable components to the automations, the quicker we're able to develop things. And so we took our average development time from a starting point of about 12 weeks down to, we're now closer to about 7 weeks for average development time for a medium to high complexity process. Mitch: (09:11)You're clearly continuing to implement this. And I think that was going to be my next question also is, you know, how scalable is this, you know, how widespread are you automating things within, you know, your finance and accounting function here? Shifra: (09:26)Yes. So, you know, Discover started the RPA program in the finance and accounting. It's a common place across a lot of companies for things to start because they are very easily identifiable processes that you can start with. It's also frequently a place where, you know, we're looking for that efficiency. And so we did start in finance and accounting, but what we've done in terms of scaling things is really, partnered with others across the organization, to help other people learn about what we've been doing and think about ways that the technology can be used in their areas. And so from a company perspective, it's really developing different spokes. The model uses a hub and spoke. So we have sort of a centralized technology team, that helps with, you know, troubleshooting some of the connections, and ensuring that the bots have you know, the technical space they need to do their work. So we have a centralized technology team, but then we have spokes that are sort of business led teams that are working on automations within their own business units, but it really was a question of getting the word out and educating across the company to build additional momentum and to really get that scale. Mitch: (10:58)And then I suppose maybe the most important question when you're looking into implementing an RPA program, what's the cost? How does this really affect the bottom line of the company? Shifra: (11:09)Yeah I think you would get a different answer well kind of depending who you talk to. The answer is different because the way that companies use it they'll have different things that they measure. You know, some folks are looking at hard dollars, some folks are looking  at hours saved, but also the pricing is different depending which software you're using and how many bots, you know, they'll do tier pricing so that the more box you have, the cheaper they get. But it kind of, it doesn't matter because across the board, no matter how you're thinking about it and how you're measuring it, the cost of having a bot do certain tasks versus a human is a fraction of what the human cost might be and again, because the bot is doing repetitive, mundane type tasks that people don't love doing anyways, there's an added benefit because in the time that you're saving, you're also enabling people to think more creatively and to free up their time for much more important work. Mitch: (12:27)Well, that definitely makes sense. And I think, you know, once all this is taken care of upfront and you begin to start the process, as you said earlier, you start to get more buy in when people have this flexibility, but once the program is up and running, I'm sure there were challenges as well, whether it was in your function or across the organization in new functions, trying to adopt RPA. So can you talk to some of the struggles maybe that you came across when looking to set up these programs or things that you would advise others to look out for when they're starting their process? Anything to kind of keep an eye on? Shifra: (13:05)In the research that we did before we started, there were probably three themes that we came across of challenges that people might have. One is around, training, like having the knowledge to be able to actually use the tool effectively. One is  technology challenges you might have in having the bot interact with other systems. And then the third  really, if you want to get the return on investment that you plan for, you really need to have a long list of processes that could be automated and you need to keep at it, over time. So I'll take those each separately, and talk a little bit about how we address those. So with respect to training, I already mentioned, we thought that it made a lot more sense to get internal people who understood the business and understood the processes and teach them how to use the tool. The majority of the software applications available we'll provide, you know, those companies will provide some sort of initial, like self study training to learn how to use the tool. We found it very effective to get a little bit about outside consulting help when we were first getting started. And essentially we had the consultants, you know, with the first process, they did it and we were looking over their shoulder with the second process. We did it and they were looking over our shoulder and what the third process we were doing it and just calling them if we needed help. And that really enabled us to get a deeper understanding. And we picked processes that had enough complexity to them that there would  be certain challenges to work through. And to have somebody holding our hand, as you were troubleshooting on those things and it was a very effective means for us to get folks trained up. And since then, we've developed an internal training plan where, you know, we have folks who are already up to speed and certified developers training any of the new folks who come to any of the RPA business unit teams across the company. The second element was around technology, and what we did there is I mentioned we have this hub and spoke model. So we have some, a handful of dedicated a technology folks whose primary responsibility is to help the different business units spoke teams, when they come across challenges in getting the bot access to certain other applications. And so having people who are technology specialists, but also understand the bot software has been critical to the success of our program. Because again, you know, until you try using the bot with certain other applications, you don't know exactly how it's going to work and there are challenges, you know? You have that little, I am not a robot click box and, and all kinds of things like that, where you have to figure out a way to get around it and allow for the bot to be able to access certain things. And so having technology folks, dedicated to helping with that was also critical for our success. And then the last thing was around having a very long list of processes that could be automated, and what we did there so I mentioned we had, you know, sort of a pilot team that helped us launch and that the team, you know, the cheerleaders and the voice of the program, what we did was we developed with that team, a video that basically showed the two screens next to each other one with a human doing the tasks and the other with the bot doing the tasks. The bots are about 16 times faster than people, and so when you're watching this video in real time with somebody explaining to you, you know, here's how this works. And when the example you're giving is something that other people can relate to. It was a great tool in generating excitement, you know, you could have the chief accounting officer or the controller get up in front of a big group of people and say, this is important program and we want everybody to be involved, and that really only gets you so far, but if you have somebody peers demonstrating to them, like this is how it helped me, and this is what I did, and they're enthusiastic and they're excited and they're sharing it with their friends, you get a totally different level of engagement. And that was a tremendous tool for us. And, and people came away from that with a level of excitement, and started generating more ideas and coming back and ask me, did it work if we tried this work, would it work if we tried that, and so I think that, yet another element that was, that was very helpful, in getting our program launched effectively and continuing, Closing: (18:51)This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession, if you like, what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

FULL EPISODE TRANSCRIPTAdam: (00:05)And we are back with episode 74 of Count Me In. IMA's podcast about all things affecting the accounting and finance world. I am your host, Adam Larson, and I'll be introducing you to our featured guests, Karim Ghandour. Karim is a succession strategist and the founder of Legacy Line Family Office. He joined my cohost Rouba to talk about the challenges that family businesses are facing during COVID-19 pandemic. Rouba asked Karim to share some of his insights on best practices for business owners, as it relates to cashflow digital transformation and cyber security without further ado, let's bring you to their conversation now. Rouba: (00:47)So Karim, I know that you work with a large family business owners around the world, you know, you have offices in Portugal and Beirut and the UAE. Can you tell us a little bit more about what you do? Karim: (01:05)Yes, as a family succession strategist, I assist family businesses, family offices, organize their estate in order to sustain that legacies. I do that by being the focal point of the family advisory team, being legal, tax, governance, or asset management. We act as the confidant for the families. Rouba: (01:31)It's studied by Deloitte found that 53.7% of first generation family members remain involved in the business. What type of role does governance actually play in such an instance and more specifically crises governance, and do the leaders that you work with consider it essential? Karim: (01:48)Well, it depends on, depends on the, on where is the family business is, is in it’s  journey, it's evolution journey. If the first generation or the founders are relatively young, okay, then governance might not be a focal point of the decision making. They usually founders depend more on the intercoronary instincts. However, if the family business is managed or owned by the second generation or the third generation, then definitely governance becomes more relevant, and actually by the time they reach the third generation, it's a must to have a proper governance system at least. Rouba: (02:37)And perhaps even more so during this time, I mean, it goes without saying that we're going through potentially one of the toughest times in human history, both economically, and from a human standpoint. COVID-19 transformed our lives in every single way. Karim: (02:52)Most of the businesses that not really plan for such an event. So definitely there's a lot of planning will be done in the months to come. Rouba: (03:04)Yeah, and technically, how has the impact been on family businesses in the region and around the world? I mean, you work with them. It'd be great to get your perspective on, on how severe or not the impact has been. Karim: (03:17)It's a bit early to, to evaluate the situation, even in the public company, most of public companies will be publishing results of the second quarter in the first or second week of July. At least that will give us a glimpse of what is the real impact of the situation financially and otherwise. Rouba: (03:44)Fair enough. Middle East Family Business, a survey conducted last year, found that 66% of those interviewed said that they do intend to step up their digital capabilities over the coming two years. But with most companies around the world, reporting at least one cyber attack per year. How aware are family business owners that you work with of the importance of cyber security and the potential threats of financial loss data breach, and in some cases, business continuity and how invested are they in actually securing their companies, especially at a time where most business transactions and communication is actually taking place remotely online? Karim: (04:25)It's striking when you analyze a family businesses. A lot of them, I would say, did not invest in their innovation and technology. And especially, I notice usually I look at the family business and I see who's a dependent, who's managing, look at the leadership of the family business. And usually when we have a leadership which belongs to the X generation or the baby boomers generation, usually they resist the whole concept of digitalization, and therefore they would reject an idea like cyber security fencing and passing on other information. Rouba: (05:11)Have they not been impacted? I mean, did it ever happen that they reported any cases of cyber attack and still they're resistant? Karim: (05:19)Of course, and I mean, we experienced last year they were using their Gmail and Gmail got hacked. Yeah, and there was an event, which after we evaluated the situation, we noticed it was one of the employees was using their Gmail actually, which calls that a hack. But they're not taking it as seriously as they should. And we are  noticing and advisory work, cybersecurity is becoming more relevant. The Big Four are pushing for it. I've seen this in more than one occasion. I witnessed two years ago, a German family who liquidated, who sold their business, 4 billion euros. And one day when one of the Big Four assessed the situation, it was clear, they have a lot of vulnerability in terms of cyber security, and they advise them accordingly. There's a lot of work to be done that there's definitely a lot of work to be done on that front. Karim: (06:40)When we consider, the family business segment, some of these are considered complex multigenerational institutions that have faced and continue to face numerous challenges, be it from the continuity standpoint, succession planning, maintaining relevance, and demand, diversification. Do you think that they are relatively more prone to withstand the difficult times more than say conventional companies and particularly when considering like legacy businesses and the historical changes that they've had to endure across at some 0.4 generations back?(07:18)Generally, and it has been proven family business across continents, family businesses are more resilient than non-family businesses. And the reason for that, because a family businesses plan and think in terms of generation, whereas nonfamily business they think in terms of fiscal year quarters. Moreover, when it comes to the staff and the team, you see more loyalty in family business, than a non family business. Employees specially senior employees have been working with the family for a long time, they feel like they have this extended family feel and that's why they when they do a sacrifice, they know there's somebody watching and that they will take that in consideration, and you don't see that in non-family business. And finally it hasn't been proven that family business, when it comes to the decision-making as owners, as shareholders or on the management, they're faster than nonfamily business and they are more agile. And that's all of that attributes to results. Rouba: (08:34)So can one assume that if they, they have enough reserve to sort of sustain cashflow for another 18 months or so they would be some of those companies that come out of this situation.(08:47)Definitely. Family businesses, one of the issues they face is the lack of capitalization. Unlike the non-family business, which are more capitalized. So it's an issue of cashflow definitely next 12 to 18 months, it's all about cashflow. If they make, they make it, they don't, then that will be a part of the larger statistics, which we hope on the big buck. We right now we might experience one of the worst economic downturn since the 1920s. And with that, we expect family businesses, and non-family businesses to be wiped out. Rouba: (09:33)You know, predictions are predictions, but, the next few months are going to be very indicative. And that's why I think, the role of people like you advisors, like you is crucial, because you might be the make or break in, safeguarding, the wealth, the wellbeing of a company. That's why I wanted to know what kind of advice would you give to family businesses for them to survive, not just during this pandemic, but also to have a, not smooth, because I don't think there's anything smooth about the situation, but a better recovery tomorrow when the time comes July onwards. Karim: (10:09)Well, everybody's assessing right now, the situation it's a bit early to make decisions What we are advising our clients to whatever decision they want to make to involve the stakeholders and their future that's being the employees, shareholders, (inaudible), or clients. It's very important that, you include the stakeholders during this time, this crucial time. Second, you need to have to have an open, to be open minded regarding the future. Many of the things which were unacceptable or wouldn't look at now, they need to reconsider their vision. They need to reconsidered their business model to move forward. And finally, to harness technology. As you said earlier, there's a shift right now on the way we work, the way we study and it's not harnessing technology is not an option anymore. They have to, it has to be part of the business model. It has to be embedded in the business model of any family, family, or not family. Closing: (11:21)This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard. And you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Mazars USA Links:https://mazarsusa.comhttps://www.linkedin.com/company/mazars-usa/https://mazarsusa.com/ledger/ https://mazarsusa.com/pandemic-event-preparedness/https://mazarsusa.com/consulting/ppp-services/ https://mazarsusa.com/services/business-financial-sustainability-program/https://mazarsusa.com/paycheck-protection-program-analysis-tool/  Contact Our Featured Speakers:Alisha Jernack - https://www.linkedin.com/in/alisha-jernack-69882350/ John Confrey - https://www.linkedin.com/in/johnconfrey/Ryan Vaughan - https://www.linkedin.com/in/ryanjvaughan/ FULL EPISODE TRANSCRIPTAdam: (00:05)Welcome back for episode 73 of Count Me In, IMA’s  podcast about all things affecting the accounting and finance world. I am your host, Adam Larson, and I'm happy to share this very timely conversation held by my cohost Mitch and a small panel from Mazars Business Advisory. He spoke with Alisha Jernack, Ryan Vaughan, and John Confrey about what Mazers has done to help clients with the PPP loan, a proprietary tool to help analyze its client's applications and calculations and the overall business, as it relates to the CARES Act. Our guests also discuss what the recent crisis has done to financial and operational opportunities for sustainability as we enter the new normal and next phase of business. For a highly informative and firsthand experience on this valuable topic. Keep listening as we head over to the conversation now. Mitch: (00:58)So obviously there's been a lot of interest in various discussions around the PPP loan. I know you have done the significant amount of work with this for your clients and tailoring different solutions. So I'm wondering if you can just tell us a little bit about your stance and what you've done for your clients when receiving questions about the loan. John: (01:17)So I would say with the loan and that that's, you know, a lot of moving parts have come about the PPP, you know, at first got introduced rather quickly. I think the bill was, was put out out of necessity, with some speed behind it and with that has come, some fluidity that's been needed as the bill evolves and the guidance evolves, you know, the bill is compounded interim final rules, there's treasury FAQs. So a lot of different things, I think what we've been able to do and it had to do with our clients and be flexible and be nimble, and also having our clients, you know, adapt to the changing environment, which has been an interesting approach for us. Alisha: (01:56)Yeah. We saw from the onset, right with the signing of the CARES Act that there was a, a big rush, upfront to get everybody to apply. I know, I think the bill was signed  late on a Friday, and we had all come through it and we were working literally throughout the weekend to make sure that we were able to understand, you know, what benefits there were within the CARES Act for our clients and then come that Monday, we were ready to roll. And I think, you know, each one of us, we were scheduling, 30 minute calls, you know, over, over two days to make sure that we were having conversations and letting our clients know what the benefits were, and how it applied to them and then, you know, we got hit with a big rush. We were able to develop a tool internally, that we were able to use and help our clients to quickly apply and it ended up being a good thing because soon after the funds quickly ran out, and then some time passed before they, then came out with second round of funding. So it was interesting and it continues to be ever changing, and we're learning every day and adjusting every day. Mitch: (03:09)So you just mentioned a model that you put into place. Can you tell us a little bit about what went into that and really, you know, what made you decide to take on this kind of initiative and pursue this kind of solution? Alisha: (03:21)Sure. So yeah, at Mazars we work with a lot of privately owned businesses. What would be, you know, deemed small businesses as defined by the SBA and, you know, depending on the size of those clients, they don't necessarily have the teams in place to be able to execute quickly, and with this, we knew that time was of the essence. We also knew from going through the CARES Act that there were certain stipulations in there, and credits and benefits that you couldn't take, you know, it was one or the other, you couldn't take both. So we knew that we had to be able to go through and make a determination one, do our clients qualify? And then two, what is more beneficial to them? And that's really what led us to, hey, we need to develop something, so that we can put together and have an analysis to share with our clients, because if they apply for the PPP, then they're not going to be eligible for other benefits. So we knew we had to help them and, you know, have that quickly to them so that they could make the decision. We knew the funds were likely to run out quickly. So we got together a core team, from the start, it was probably 20 of us. We were literally meeting nightly and, and probably spending two or three hours together, and we developed the tool and, you know, at first it was used primarily on the loan side and again, to assess, the benefits and, you know, with the different provisions within the CARES Act, what would be the most beneficial for them, but then as soon as the loan proceeds were received, which some, you know, were received within, a week, even we were able to then begin modeling out the forgiveness for them so that they could make decisions because they only had an eight week period to do so. So then, you know, we pivoted from first, Hey, let's make sure you get your application into the bank and we can help you, we've developed a tool and we have procedures and here's a request list, get us your information and we can turn it around to you and then following that, it was okay, you know, where are you today? How many employees do you have? Where's your payroll? And you know, what do we expect that this is going to look like over the next weeks and really looking to how we can model it out for them so that we could make decisions to be able to achieve the maximum forgiveness, you know, to the extent that we could. So we wanted, you know, we've put in place, we've put it together really to be able to help them to drive the decision making process and help them to strategize. Ryan: (05:55)Yeah, and I think it was important for us to have kind of a standard template, which then we, I mean, it started off standard. I think we had three or four iterations based on the different rule changes. So, you know, we were trying to be as flexible as we could, kind of behind the scenes, but then also to get out, because obviously the core group of, I think Alisha said 20, which is just probably close, you know, we couldn't service all of our clients. So we wanted to make sure that, we could share it across the firm and really bring the maximum benefit to our clients, which we needed something relatively standard to be able to utilize that. Mitch: (06:38)And you just mentioned something also, you know, the ever changing guidance that's going out. And I know I'm sure you're receiving a lot of questions from your clients as far as, you know, the the continually changing guidance, the forgiveness. So, you know, how has that really impacted you and what are you doing to stay up to date and continue advising, different people who are probably approaching this from different perspectives? John: (07:05)Yeah. The guide  changing  has been interesting and interim final rules, and there's actually one that came out this morning we were reading before this podcast. So, it's interesting, you know, I think it's not something that everyone is necessarily used to, and, and the problem with it, while at times it brings some positives is you're making decisions based on a set of rules that are then thrown upside down or change significantly the next day, and then you have to kind of reevaluate your decisions. And that's really where we've been able to, from the model perspective that the model, every time there's a need for change and then get in front of our clients individually. And then we host webinars to be able to broadcast of these changes and layer in steps and tools to kind of help navigate. I think that's, it's an important piece to what the PPP has been put out, and decision making it needs to be on the fly, which again is not probably in everyone's usual wheelhouse in terms of making a decision and just executing on it. And, you know, this thing is changing on a day by day basis at times. Mitch: (08:09)And what is the value really that you are seeing your clients are recognizing, you know, talk a little bit about what you've been able to accomplish with these, with this tool and the different solutions you're offering? Alisha: (08:21)Yeah, I'd say, I mean, it's really been, helping clients to identify opportunities, and helping them to strategize again, you know, up until very recently, I think last week it was an eight week window that we had. So with the model that we developed internally, we weren't able to identify gaps if you will, and see where there could be opportunities for them to have additional spend within the eight week period. Of course, within the guidelines so that again, they can achieve that maximum forgiveness. So we were looking at, where we were adding value was, you know, really understanding the law as it was written. So we were seeing that many, there was a lot of confusion around probably five points and those five points continued to come up. So, you know, growth versus net. And, you know, when looking to grow, are you able to pay bonuses are over the eight week period or hazard pay and when comparing for, to determine what the wage reduction amount was, and, you know, if it was an excess of that 25%, we're looking to, well, what does that mean? What are we comparing it to, does that include just our base salary? Or, you know, is that a salary of what happened if we had a bonus and the period that we're comparing to, there was also, you know, opportunities have clients typically paid their year end bonuses, or midyear bonuses at a certain time. We were looking to see, hey, you may have some, room here based on, you know, there was caps in place for the gross wage amounts on a weekly basis. But if, you know, there was room to squeeze additional pay in there, we were encouraging them, Hey, maybe, you know, we should consider paying the bonus on this date, you know, versus a date that fell outside the eight week window on the non-payroll costs. We were seeing that there was many questions around, you know, what gets included in rents, utilities and interests. And, you know, rent, everybody was quick to just assume that that meant office space or, you know, just normal, rent. But as you know, we were going through this, you know, we were encouraging them that, hey, look, it says real and personal property. So if you have a lease agreement in place for equipment, say, you can include that as, you can include that lease expense, you know, whatever's paid during the eight week period. You know, similarly some utilities that normally they wouldn't necessarily be considering and that utility buckets. So really just helping them to understand where there may be gaps and, you know, where we can spend dollars within the eight weeks and how to monitor head count even to just overall make sure that they were achieving, you know, the forgiveness to the extent that they could, or that they wanted to, because there were some instances to where, it didn't make necessarily business sense for them to just spend the funds within the eight week period. So really just, you know, having, being able to see the full picture and educate them and helping them to be able to understand where there may be opportunities and what made sense for their business. John: (11:29)Yeah. And I think too, where the value has been, has been able to provide our clients with the ability to be ready, to apply, to deal with their banks, to deal with key stakeholders in their company. A lot of questions were coming up, for customers even, right, can we help our clients and help their customers at the same time? And so both directly and indirectly helping our clients. And I think that's, they've seen the value there and, it's been a good thing for everyone. And we've been trying to be that trusted advisor to our clients. We've brought in people in the firm that can layer in their expertise and their knowledge to kind of get a cohesive group together, and be able to put out a product that serves our client in the best way possible. Ryan: (12:10)I just want one more thing to add, I think has been, you know, maybe a little bit of a reward for this is seeing some of our clients keep those jobs on during, you know, as a result of, you know as we helped and maximized and work through, you know, we've certainly seen scenarios and, and have those know sometimes tough conversations with clients, but at the end of the day, we're getting, you know, they held on to 10 jobs because of this or whatever that is. So that was certainly rewarding as for us as we went through and really helped our clients. Mitch: (12:52)So that's great. And, you know, it is nice to kind of reap those rewards personally also in you know, just now like to take a step back away from this specific tool and the model you put together, and just look at the business situation, the CARES Act as a whole, you know, kind of hindsight now, what do you think businesses and individuals should really take note of coming out of this? And I know we're still in it, but, you know, how can that kind of, open up some, maybe opportunities now, or in the future for the clients that you work with? Ryan: (13:27)So the CARES Act, I mean, the PPP program certainly, you know, kind of stole the spotlight, but, but there's, there's a lot of beneficial tax planning, aspects of the CARES Act that, you know, are really now starting to be addressed, and will be for the rest of the summer and into the early fall as, income tax returns come due for 2019. As you may recall, it was extended to July 15th for the original due date federally, most States conformed, and then the extension into the early fall. So there's, there's opportunities to, carryback net operating losses and accelerate cash flow from a tax standpoint, which we've seen a lot of clients start to really plan around and optimize, to provide further relief, on the income tax side, which has been, you know, really beneficial, and there's been some nice provisions with the NOL carryback, temporary suspension of limitations, for taxpayers to take advantage of different areas. So, that's on the business side. On the individual side, there's other areas, reducing penalties or waiving penalties for minimum distributions, retirement accounts increase in charitable deduction limitations, and then the $1,200 check that everyone got or certain individuals got, I think most of those have been distributed already, so that certainly helped on the individual side. So, there's a lot of areas of the CARES Act that added additional value, outside of the PPP that, they're really being dug into now, and we're helping our clients, you know, really mining their data, mining their historical tax situations to come up with a planning strategy to maximize, you know, the benefits and relief available under the CARES Act. Mitch: (15:44)And I guess to close things out now, what I'd like to do is kind of take it even one step further from what you were just talking about, you know, what can you advise clients as far as, you know, financial planning, you know, strategic planning moving forward, and what do you have to offer as far as, you know, maybe being you can ever be fully prepared, but, you know, with the idea that this could potentially, you know, business could be in jeopardy again in the future for one reason or another, you know, what kind of advice do you have for the clients as far as that goes? Ryan: (16:18)Yeah, so, you know, obviously this pandemic hit rather quickly, and I think there was a need to adapt just  on the fly. And, you know, I think looking past the PPP and as things start to begin, the new normal as we can call it for now, there's a need to reevaluate, I would say your business and see where, you know, what steps you need to take to get back to where you were prior to the  pandemic. And what we've been able to do is put together a financial sustainability program. It's part of our strategic business planning group that we have, that we're all a part of, and you know, what we can do is help clients see where they are, see where they need to get to and lay out steps to bridge that gap, as long as that's what they want to do. And so, we have this program in place, it's great to kind of layer things out and see, see what's next. Alisha: (17:09)Yeah, and just to add to that, it's really, I mean, we're looking at it, and we're doing it across, you know, many different industries. So of course, any industries such as retail and restaurants that have been hit the hardest, we're really looking at it as a crisis action plan, and you know, phase three of this pandemic. So we've gotten past the PPP, you know, so now we're looking to what do we do next? And as John mentioned, how do we bridge that gap? And in, you know, cases where the business has been significantly disrupted, it really almost becomes a bridge to, you know, recovery for them, and looking to, almost a modified business plan, whereas, you know, pre-pandemic, we would of course have a business plan in place. And now we need to come up with alternative strategies, and breakthrough objectives to help us to cover our overhead over the next, you know, 12, 18 months. So we're looking to, help the clients assess, you know, first, what did they look like pre pandemic, you know, then we get into what is the impact, what impact has this crisis had on their business and whether or not it's been significant to them. And then we really, you know, go deep into what are the shareholders strategies and priorities, what, you know, breakthrough objectives, can we identify our high level strategies as you take an , restaurant, for instance, you know, they're going to have to look to a revised business model altogether and looking to maybe meal kits or grocery model, or extending, you know, their delivery services. And then building that in. And we're looking at that, really today with the crisis over three year period where we would normally in our strategic business planning model look to five years, and we're getting more granular with it. So we break it into the pandemic into phases. So we look at it during the, you know, locked down and where everybody was had, there was stay at home orders. And then we look to next, you know, this social distancing phase, and then finally the recovery. And really during, you know, the first year or so, we're looking at this monthly and we're making sure that we've put plans in place to help our clients to actually be able to, you know, one execute and then two monitor, along the way. So looking at this minimally on a monthly basis, setting goals, and be able to measure against, you know, any key performance indicators and track to see how they're actually doing and are they executing on this, on this plan? So, you know, we're, we're doing it already. We see a lot of value in it. and again, it doesn't necessarily have to be just target sectors. It can be done with, with any business. Closing: (20:03)This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession, if you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Marwan: https://www.linkedin.com/in/marwan-al-suwaidi-01189828/Khalifa Fund for Enterprise Development: https://www.khalifafund.ae/Khalifa Fund Mission: "To raise Entrepreneurs and SMEs efficiency by building capabilities, unlocking financing and service options, integration with different stakeholders and advocating the entrepreneurial culture."FULL EPISODE TRANSCRIPTMitch: (00:05)Welcome back for episode 72 of Count Me In, IMA’s podcast about all things affecting the accounting and finance world. I am your host, Mitch Roshong, and the episode I am introducing is for a conversation between our co-host Rouba Zeidan and Marwan Al Souwaidi, a seasoned finance specialist and the Director of Finance & the Procurement Support Services Department at Khalifa Fund. In this episode, Rouba and Marwan discuss the future of small- to medium-sized enterprises in the Gulf Cooperation Council and the role the Abu Dhabi-based Khalifa Fund is playing in supporting this fundamental segment of the economy. They also talk about how businesses can sustain and reinvent their models following COVID-19, so keep listening for another insightful and valuable episode of Count Me In. Rouba: (00:56)So let's start with the Khalifa Fund, which is the company that you represent. It was established in 2007 as an independent not-for-profit SMEs socioeconomic development agency by the government of Abu Dhabi. The fund was originally set up to support the culture of investment amongst UAE nationals and developing obviously the SME investments in the Emirates. What was the vision behind such an initiative byt Abu Dhabi? Marwan: (01:24)Prior to 2007, let’s say, actually no one was providing loans to small and medium enterprises, so there was a vague gap in the market. So, Khalifa Fund was established to take a position that banks and financial institutions we shy to take. So, the main idea or the main wisdom of creating the Khalifa Fund is to nurture the SME ecosystem in Abu Dhabi fairs, then by 2011, we moved to the entire UAE. So, that was the main wisdom or vision behind creating the Khalifa Fund: to encourage UAE nationals to go to the private sector, by establishing your own firms, take some employment from the public sector to the private sector, and provide like a financing vehicle, banks financial institutions did not take that step at that time. Rouba: (02:43)Okay. Initially you’d started for local purposes, national purposes, but eventually in 2015, the Khalifa Fund diversified its efforts internationally with a like a portfolio of some one billion dollars across 22 countries in 3 different continents : Africa, Asia and Europe. How were these regions selected? And what are some of the promising industries that the Fund is actually looking out for, and mostly interested in?Marwan: (03:11)Mainly, going international came from a direction from His Highness Sheikh Mohammed Bin Zayed, crown-prince of Abu Dhabi. So, the main idea is also to support the friend countries to boost their economy through creating employment in their country. That was the main wisdom behind going international. We have for example the Chechen Republic, mainly for innovation, also Belarus in the innovation sector, because we see that there is a big market or an encouragement for the society there to move to that. So, we analyze the country, before going there, we find potential areas that can be developed in that country and that can support the purpose of creating employment and enhancing the ecosystem. Rouba: (04:18)So, mostly, it revolves around innovation across various sectors. You’re looking for new ideas, fresh new concepts.Marwan: (04:26)True.Rouba: (04:26)Excellent. So, according to the Credit Bureau, the total credit for SMEs in the UAE totaled to 24 billion dollars by end of last year. How is that figure expected to increase or decrease under the current economic developments resulting from the COVID-19 pandemic?Marwan: (04:44)COVID-19 is the tipping point and I think the economy will be different. So, the methodology of the regular loan provided prior to the COVID-19 will be different post-COVID-19, entrepreneurs will be different, people who are going to go to them, to the market, need to be agile, flexible. The sector, private sector and classers will be different. We cannot say it’s going to increase or decrease because it will not be compared to what it was prior to COVID-19. This is something else that we are going to talk about.Rouba: (05:31)Would you imagine it to be stronger than it was pre-COVID?Marwan: (05:36)I think that COVID-19 is very challenging for the SME sector. So, SMEs that are going to survive during COVID-19 will end up learning a lot of things that they never learnt before. So, a solid will be much so important, and they can easily build on that. Entrepreneurs who did not survive during COVID-19 but saw how the market changed are going to come back with a different mindset and a different approach to the market. So, I think SMEs will be performing much better than before COVID-19. Rouba: (06:27)Amazing, a positive perspective, as it should be pf course. So, when looking at the stats on SMEs globally and regionally, it’s a fairly similar scenario across the board, in the sense that they represent the biggest percentage of the private sector businesses and employ the largest workforce. For example, if you zoom in on the UAE, they represent more than 60 per cent of non-oil GDP and 94 per cent of the total number of companies operating in the country. And when you look at the job spectrum, they provide more than 86 per cent of the private sector's workforce – according to the Ministry of Economy. What is the government doing to help them get through this critical phase which stands to have, as you mentioned earlier, a tremendous impact, in some cases it is going to mean everything in regard to survival?Marwan: (07:22)The government introduced many government stimuli. One of them is the targeted economic support scheme, the 50 billion dirham that was given to the banks, so the banks will support our financial support to the SMEs, out of their bank sheet, let’s say, which came like a heavy relaxation to the banks. Yes, so the banks, by the 50 billion dirham, which is the economic stimulus, will be able to provide financial support to the affected SMEs by waving a lot of fees, by waving or not taking the installment, during the next 3 to 6 months, plus providing loans for the working capital, because, again COVID-19 affected the working capital. The clash operating cycle. So, the banks are more relaxed now because they are going to provide the funds off their bank sheets, this is one thing. On the local governments, each Emirate has its own government stimulus to the SMEs. So, I think UAE is one of the best countries who proacted into supporting the economy beginning of March 2020. So, I think that the UAE government acted very fast.Rouba: (09:04)Yes, I definitely second that motion. I’m based in the UAE, have been for the past forty years, and to be honest, when you contrast this globally, I feel really privileged to be in this area at this critical time, they have been wonderful, in agility as you mentioned, it’s a crucial kind of attribute at this point. In a survey conducted by the Pearl Initiative, they found that 70% of SMEs surveyed in Saudi Arabia and the UAE stated that they face a number of challenges such as economic conditions and finding experienced personnel, they also noted a key one that comes to mind which comes to mind, which is raising capital. If this was already challenging to raise capital in Q4 of 2019, can we assume that it will be even more challenging post-COVID-19 and what are some of criteria funds like Khalifa will be looking for? Speaker 3: (10:04)As we said earlier, I think that the approach towards SMEs will be different, prior and post COVID-19. The entrepreneurs who will survive will look at the economy from a different perspective. New entrepreneurs, new entrances to the market, will have a different approach, again. We know that innovation played a critical role during COVID-19, most of the businesses who are able to move fast from being a normal shop to online, they get a bigger market share from people who did not react. People who moved, or businesses who moved, for example tailor shops, most of them are women tailor shops, some of them have moved to tailoring masks, surgical masks, those have benefited from COVID-19 against other tailor shops, in the same industry, in the same sector, who did not react and waited for customers to come to them and do the fitting, So, the approach will be different. Entrepreneurs, instead of looking at “I need a loan or a capital” they are going to be more specific, in needing for example procurement financing, we need a working capital financing, so I think these are much cheaper, or have a lower value than having a big capital. This is one thing. The second, we said that the government has provided stimulus from the central bank to the banks, they will be able to provide loans for SMEs, upon having good feasibility study, so the approach is different, this is concerning debt financing. We have another thing, which is equity financing, we know that this region is developing in the private equity and the venture capital market. So, we will see. We have “Ghadan 21”, which is promoting private equity, promoting angel investment, promoting venture capitals to come in, so I think that the approach will be different. We cannot say challenges to raise capital, no, it’s about the type of capital needed for these businesses. Rouba: (12:59)And do you think that it’s going to take time, or is this something that will be ongoing as we progressively come out of COVID-19?Marwan: (13:07)Rouba, did we ever think that some day we will be working from home as well as we do from the office?Rouba: (13:15)Absolutely not! I mean, I personally did, but not everyone. Marwan: (13:18)Not everyone, majority of the people. But we’re functioning well, we’re keeping things as smooth as possible. We changed on the personal level and that reflected on the way we do our businesses. We teach our children at home and they are getting grades similar to when they studied at school. We found some hidden skills in ourselves that were not there. Similarly, if we apply this on the economic level, of course these entrepreneurs have shifted their thinking, and we know that for most of them. COVID-19 will end but the people’s mindset will be different. Rouba: (14:11)Yes, absolutely, it is one of those transformational kinds of experiences. So there has been a recent announcement that Abu Dhabi is set to allocate 15% of procurement spending and annual contracts to SMEs as part of the country’s economic stimulus package. How involved is the Khalifa fund with this mandate and what is the desired outcome from this?Marwan: (14:38)The Government of Abu Dhabi announced 15% plus paying all invoices in less than 15 days. That will contribute heavily to the operating cash cycle of the entrepreneurs. SMEs are very sensitive to the cash. By having the government buy from the SMEs, 15% of the government budget will go to the SMEs, the SMEs will have more cash that they can operate within increasing the level of employment, increasing the level of output.Rouba: (15:27)Or maintain their level of output…Marwan: (15:31)I think yes, maintain, but also this will increase their output. Khalifa fund is coordinating with the department of support to the government because that government is the one behind this initiative, trying to coordinate with them and sign an agreement which will allow all members of the Khalifa fund to participate in the government procurement. This is on the government level. But for Khalifa fund itself, we have that since a long time. We have two KPIs, which are the percentage of procurement, 15%, and the number of transactions with applicant. So, we do support them financially and through procurement.Rouba: (16:34)Okay, excellent initiatives by the way, especially in this dire phase where people assume that activity has slowed down. It’s good to see that initiatives are still running. What advice do you have for SMEs at this critical point in time, as they struggle to keep their heads above water, to keep their employees, what advice do you have to give them? Marwan: (17:02)I advise all SMEs to think about the opportunities of this challenge. Of course, there are many opportunities that arise from COVID-19. Look at that, and see your production cycle, how you can change it to fit the new requirements of the market. Try to connect cyberly with your customers, keep them, engage with them. Maybe they are not going to have the purchasing power, it might be low now, but in the future, at least you will be there. Your employees, you need to keep them engaged, try to brainstorm new ideas on how to move your businesses. For example, if you are a restaurant, you are only allowed 30% of capacity. So, what you do is: focus more to shift your strength to delivery. How do you do that? Through tying up with delivery channels like Deliveroo, Tawseel, Talabat… Try to find new windows for your businesses. This is the main advice that I can give to the entrepreneurs.Rouba: (18:32)Excellent advice, it’s finding opportunity in the adversity of this situation. It is a very warranted approach. I think it is the only way to come out of this, if you try to find a strand of hope and opportunity. So that’s been amazing advice, amazing feedback and input. Thank you so much Marwan, it was a pleasure having this chat with you this afternoon.Marwan: (18:56)Thank you, Rouba. Thank you. Closing: (19:00)This has been count me in IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Jeremy: https://www.linkedin.com/in/jeremybehler/FULL EPISODE TRANSCRIPTMitch: (00:00)Welcome back for episode 71 of Count Me In IMA's podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong and I will be previewing our conversation between my cohost, Adam and Jeremy Belhar, the CFO at Sargento foods. In this episode, Jeremy discusses the importance of leadership when seeking to innovate and facilitate change. He shares some of his personal experiences and talks about how innovation and change does not necessarily need to revolve around technology. As a matter of fact, a big leadership quality he emphasizes in this episode is trust. To hear everything else he shared with Adam we're going to head over to the conversation now. Adam: (00:49)So to get started, I just wanted to ask you what leadership characteristics have enabled you to climb to such a high leadership position within such a well known organization? Jeremy: (00:59)Well , I think there's a few things. First and foremost, you know, I think it's important to note that there's not a one size fits all approach to leadership nor to achieving career success. It's one of the things, when I came on board early in my career, I looked at some of the leaders that I aspired to be, and it was at times a little bit challenged in terms of differences of what I saw versus what I felt and knew my core, personality, and beliefs and, and overall approaches were. And so for me, I've taken it a point to really be authentic and sincere first and foremost, because you can't be someone you're not and be successful and be, consistent throughout an entire career. So for me, what I try to do is I try to one, always be open minded and, and I have a general view of abundance. I always believe that there's always newer and better ways of doing things about thinking things. While I would characterize my thought process is largely databased, I also recognize that if it was as simple as that, we wouldn't need, leaders in positions cause we could just write programs to interpret data, and that's not as easy as there. So it's balancing the data piece with the judgment and understanding how to navigate in the gray area, where, the more senior you get that tends to be more of where you play. And I think the other, the other area that's been important is as you move up in the organization, I didn't appreciate as much the need to stay connected to what's really going on. I like to think of myself as a pretty approachable person, and have a very open communication process with most of my teams, but even with that, as hard as you can try, there are a lot of times where information just doesn't make it to you, because of your level, regardless of how you approach that. And so I've made it a point to, have deep relationships and set up processes so that I can have better insight into what's really going on, and understand when that may be inconsistent with what I believe, or I'm being told it's going on. Adam: (03:33)You know, it's a really interesting insight to be able to find that connection between what's really going on and what you're being told is going on. And how do you, how do you cross those together? Have there been innovative ways that you've been able to do that, to make that connection? Jeremy: (03:49)Well, I certainly, from a reporting technology standpoint, the more democratize data is the easier it makes that, in, you know, if you go back 20, 30 years ago, when we didn't have the rich powerful, ERP systems that we currently have management and executives would rely upon reports that they get from their teams without a real efficient way of validating that. And that's not to say that people are intentionally mischaracterizing data, but certainly there is a level of interpretation that comes with communicating, results and data, and if that is done in a manner that is intended to frame it in a positive light versus a negative light, you may not know that. And so being able to have access to more data, more timely data,  and data that doesn't maybe go through as many filters, certainly allows you to have a little bit more insight in terms of when the information that's being shared may not be the entire truth. It may be accurate data, but the information that that data is communicating, perhaps isn't consistent with what your objectives are or intents are. Adam: (05:15)That akes sense. So when you're, when you're a leader in any organization, it requires you to be innovative, to kind of come up with different ways to, to run the business better. Are there any innovative things that you've come up with that you can, that you've adopted to make your business more effective? Jeremy: (05:34)Well, sure. I mean, I think innovation is one where it's a little bit of this just magical word that means so many things, and a lot of times, I believe innovation is mischaracterized as being technology. And while technology is certainly an area that has seen, a very high level, of innovation, it's not the only area and, you know, innovation, if you get to the core of it, innovation is just a new idea and it could be a product, it could be a way of doing something, it could involve people, it can involve technology, it can involve process, and so for me, being able to embrace technology is really about being able to embrace change. And I think that in my career, one of the things that I've seen that really differentiate how effective, differentiate how much technology and innovation can have on a person or a group of people is very highly correlated with their openness to change. And, you know, for me personally, I've always hungered for new and better ways of doing things, and so inherently I have a very open mind to change, and I know that's not true across the board for everyone and it's not right or wrong. We're all right, you know, wired differently and their strengths and, and opportunities to each of those, but for me, it's never been a challenge because I, I really embrace it. And for me, how I've tried to utilize that with my teams is, to show examples of why that change is going to benefit all of us collectively, and in most cases, all of us individually as well. Certainly there are some new innovations that can have a negative impact on an individual, you know, maybe takeen to the extreme. Maybe there are certain roles that will be obsoleted by that, and I think that's why there's a lot of this inherent fear about innovation is. But what if you take the longterm view to that if you embrace that change, you're also going to embrace the opportunity that while your job may go away, your management team, your executive team, will see how you respond to that. And if you embrace the fact that your job is not going to be needed in a year, and you proactively identify that and work to resolve that, yeah, they may not need you to do what you're doing in the past, but what's more important is that you are seen as a thought leader that can lead future changes and future improvements and future efficiencies, and your team is going to want to keep you around for that. And you're going to have shown, that you have that mindset to be able to do different things and not look out purely for yourself, but look out how we can be better collectively. And I think that's something that, you know, throughout my career in the coaching and mentoring that I've done,  has been something that's been, a really clear differentiation between those who are embracing of new approaches versus those who see them purely as a threat. Adam: (08:53)So you mentioned a little bit, some of the things you’ve done to help folks with change, embracing change, how, as a leader, do you get your whole team on board? You know, you mentioned some of the things that people can do with that, you know, to, to embrace that change, Hey, my job may go away. You know, what are some things I can do to be on board, but how do you bring your team into that change? I mean, like right now, and as we're recording this, we're in the middle of a pandemic, and so many companies are doing all these changes. How do you bring your team along to make sure that they're onboard and not feeling left behind, because not everybody can go as quickly as the next person? Jeremy: (09:32)Well, at the root of it, the foundation is really trust and it's not specific to how we embrace innovation. I think that's the foundation of any successful leadership trait or any successful leader and how he or she, works with and leads their teams. If you don't have trust, it is infinitely more challenging to share any information that is not overtly positive. But if you have that level of trust that I respect you, I think, highly of you. That, that also then opens the opportunity for me to share maybe what you aren't doing as well. And then, then if I'm on the receiving end of that information, I have two ways to interpret it. One is my manager is telling me something and he, or she doesn't know what the heck they're talking about. I'm better than this, or wow, they usually give me pretty good feedback on what I do well, they're sharing with me what I don't do well. Maybe there's some truth to that. Maybe I can embrace that. And I think the trust piece of how we drive innovation is also the same. You know, if I get up in front of a group and talk about how we want to embrace a new, a new piece of technology, let's call it RPA, which is obviously a hot topic right now. If you don't have that level of trust with your team and you go share your desire to pursue a significant amount of investment in the RPA space, it's logical that people would be concerned to say, okay, RPA is all about taking some of these repetitive tasks and making them automated. Well, gosh, if I'm in a clerical role and that's what I do, I'm going to go right to, well, that means my job's going away. But if I set that tone upfront that says, wow, we have a great team that are all dedicated and aligned to working together to further our company's strategies, and I think that this team is spending a lot of our efforts and things and spending a lot of our time in areas that aren't the best use of the thinking, the mindset, the ingenuity that we have. I'd like to free up some time for all of us so that we can spend more time doing that. It's just becomes a paradigm shift to say, yes, my job is going to look a different, a little bit different a year from now or six months from now or two years from now, whatever that time horizon is.  But rather than being fearful of my job, going away, I'm going to embrace the fact that I'm not going to have to spend 40% of my time doing these repetitive, somewhat mind numbing tasks, and I can do much more, motivating and much more empowering type of work, that really leverages my strengths and takes away the negative elements of my role. I mean, those are the things that I hear a lot from my team is they want to feel like their work is more impactful, and the more time that they spend in spreadsheets or doing detailed transactions the less so they feel. And so if we can eliminate that work, that's a, that's a win, win. It's a win, win for the organization because we become more efficient, our team is more motivated. They come into work with more energy, more, a willingness to work and find new ways of doing things, and that creates then this almost self-fulfilling cycle of finding new ways to do things even after that first  tranche of improvements. Adam: (13:02)So it seemed that trust is a key foundation to any mindset or leadership that's trying to drive any type of change. Jeremy: (13:12)Well, certainly for me, I believe it's critical to being able to do it on a consistent and sustainable basis. You can definitely take a, more of a Draconian, top down approach where you mandate, but I think that, in some organizations, and it's probably driven by the size of the organization, as well as perhaps the, seniority of the group and how much tenure there is. A top down approach, you may not have the consistency of adoption, and the transition path will likely take much longer because you're going to be dealing with a lot of the, the antibodies, if you will, that are trying to fight against that change because there's, there's not a level of trust of, I know what it's going to look like when we come out on the other side. Adam: (14:02)Definitely,aAnd, and as, and it seems with the rise of technology, the world seems to be shrinking. So it's no longer the CEO sitting up in his corner office and the top of a building that people never see. All you need to do is go onto Twitter or whatever device that that CFO is that that high up person is using, And you feel that connection all of a sudden. So it's, it's almost like that top of top down approach may not work and the way the world is changing as we go forward. Jeremy: (14:29)Very much so. And I, you know, I think the people are speaking and very few people like that, that top down approach, they want to feel that engagement. They want to feel that connection. They want to, they want to be part of what we're doing. So it's not necessarily that they disagree, but when it comes from an edict on, I, there's not always the understanding of why we're doing it, or even sometimes, you know, what I, as an individual need to do is just collectively, here's what we're doing. But if you make a compelling case, if you have a clear way to articulate that to the team and others, so everyone understands what their role is and, and why we're doing this, not only will they be more engaged, but also it almost to use the antibody analogy, again. You build in the healthy blood cells to then go attack those antibodies, because you've got a majority of your team that is there's onboard, everyone's rowing, to the same beat, and if there's one or two detractors out there, that will be addressed organically, and it won't require any sort of intervention from a management standpoint because the team will bring those folks along versus having to be done via a more direct manner. Adam: (15:47)So what advice would you give to somebody who, recognizes, we've been having this conversation about change and about innovation and just how to build the trust. They want to change their own mindset. What steps should somebody take to change their mindset, to say, you know what, I need to change my mindset so that I can help bring my team along. Jeremy: (16:07)Well, I mean, again, it's individual, so there's not a one size fits all approach to this, and you have to tailor your approach to your specific personality and communication style. But in general, I think it's, it's important to, make a compelling case, certainly to address the most obvious or, or salient, areas that we'll create concern amongst the organization, and it's also a little bit of training to, have faith. So once you build that trust, you may not require that same level of validation before you decide to take the leap of faith and get on board with something. And so I'm doing that work upfront to establish the trust in that track record of where, yeah, my manager said that he or she is open and that they want to hear things, but if every time your team comes to you, with those things, you tell them, you know, to come back a different time or you don't have time to talk to them, or even worse, you hear their feedback and you just don't even acknowledge it or act on it. Well, then your words, aren't consistent with, what your team sees as your, your true actions, and so they're going to be much less apt to support you or to quickly latch on to any tribe type of changes or innovation that you're going to be bringing to the team. because of that, that kind of more personal concern about what does this mean for me? Closing: (17:48)This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard, and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Vidal Espinosa: https://www.linkedin.com/in/vidalespinosa/Invictus Advisors: https://invictus-advisors.com/FULL EPISODE TRANSCRIPTMitch: (00:05)Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong and I am here with the 70th episode of our series. Our guest for today's conversation is Vidal Espinosa, the principal partner and CFO of Invictus Advisors. In his conversation with Adam Vidal explains why he believes everyone is broke, they just don't know it yet. And he tells us how accounting is about way more than just the numbers. Let's listen into their conversation to get these answers now. Adam: (00:41)So you have this saying, that is, and I just have to ask, what do you mean when you say everyone is broke and they don't know it yet? It just baffles me when I hear that. Vidal: (00:52)Well, it's probably exactly what you think it means. We all are broke and we don't even know it yet. But our saying goes most for business owners, most business owners think that, they're making it, they think that their business, it's amazing because they're taking some money to their personal bank accounts and their living the life. Unfortunately, when they review their financial statements, they realize that they're broke. They realized that holy, I am not making what I thought I was making. That's what we mean. Adam: (01:51)So how do you get started on that process of finding out that you're broke? Vidal: (01:56)It's very simple. People are afraid, extremely afraid of knowing their numbers, of knowing their finances, of knowing how they are doing because deep down they really know that they're broke. So it's very easy to go into your bank account online and see the balance, and as long as there's money there, you're doing good. Oh, okay. Perfect. But they don't take into consideration everything that they owe. So we have a very simple system, which is two checking accounts for your business. Even for yourself, two checking accounts. One checking account, it would be for all your income, all your revenue, either from your payroll, from your business, whatever it is. And the other one, it's just your expense account. Meaning that every single monthly payment, meaning every single vendor that you have to pay goes from that account only. So at the end of the month, instead of reconciling which you need to do, which is reviewing every transaction in your bank account versus what you think it is. The income account, wherever the revenue and payroll came out, the difference, the balance that it's there, that's your profit, that's for you. You realize that sometimes that's going to be negative. That's when you realize your realization of, oh, I might be broke, comes true. Adam: (03:43)Now that makes a lot of sense. And I could see how somebody could apply that even in their personal accounts as well, not just their business. Vidal: (03:51)Exactly. Exactly. You can use it for your business or your personal life. It's very simple. It's very simple. And you realized that your broke, as pretty much everyone right now in America, a lot of us are, are noticing that we are living paycheck to paycheck. We actually had a discussion and a conversation like, I don't know if you remember last year when the government shut down and they furlough a lot of government employees, but they were living paycheck to paycheck. I would have thought that we would have learned from that experience, and I'm advising that we did not. We did not learn from that experience just to save or rainy days like now. Adam: (04:42)Definitely. And I guess a lot of times we don't learn from our history. We don't learn from what's happening right in front of us. And then when the, when the rainy day does come, it's such a stress and we get past it. We don't, we haven't learned from our own experiences either. And so what can somebody do to kind of get started to getting over the broke, the brokenness? Vidal: (05:05)Just very simple. Open two checking accounts or open an additional checking account that it's only for your revenue, and I mean revenue as if you're a business owner or your income only income sales or if you're in a working just your payroll goes through that account. That's it. You'll probably gonna have, two or three transactions in that, that account, which is . the two deposits on the 15th and the 30th and one, two, three transfers to your expense account just to cover your expenses. The balance on your revenue, on your income, on your funding account, that's your profit, and we are going to realize that we are broke. Adam: (05:51)So once you start seeing your profits and you start understanding that, okay, I am broke, but now maybe I'm not as broke, what's the next step? Vidal: (05:59)Start controlling your expenses. Start controlling your expenses. It's on you. And even as a business owner or as an individual, you're going to see that on your expense account, lunch, Starbucks, a lot of things that are not necessary that you can actually live without. And yes, you can splurge a couple of times a month and things like that, but if you want to get out of broke, you're going to start by controlling your expenses. But really if you want to generate well and or get out of being broke, increase your revenue. I had an experience with one of our clients, very, very good friends of ours. They've been a client of ours like four, eight, nine, 10 years, 10 years, and we met them at a loan event. They were lending micro lending, for small, small, small business owners. So this company, they got a loan, and they came to us to help them manage their cash, structure their business. And in our very first meeting they said, Oh, we got a $10,000 loan. Mind you, that loan was like for, 25  or 30% interest. It was a micro, microloan. It was from, for a startup. So that money is very expensive. Six months down the road, they spent all the money and they came back to us and say, Oh, we're going to apply again for the loan. And I said, no, no, no, you're not going to apply for the loan. You're not going to apply for another loan. Utilize your energy and your focus on how we are going to increase our revenue. How are we going to make money not getting a loan or getting new credit cards to increase our revenue or our income. So, to make a long story short, now their revenue, it's $5 million. Adam: (08:06)The members of IMA are accountants, management accountants and they're the ones kind of looking at the books and finding all these things. You know, what if you're an analyst in your company, and you need to go to your CFO and say, Hey, we're really broke. What are we going to do? Vidal: (08:24)I would have approached my CFO with ideas. I would approach my CFO on ideas on how to increase revenue. Now a days accountants, we cannot just be bookkeepers and analyzing financial statements and saying, oh, your working capital is this much, your, your debt is this much, your accounts receivables are this, your turnaround on inventory is this and that. You cannot do that. It's no longer feasible. What you need to do is you need to be operational, and you need to focus on sales. You need to focus not on tax strategies, not on saving on cost reduction on manufacturing, if you're in manufacturing industry. That's of the past. You need to be more operational focus on generating revenue, focusing on the marketing side of the business, on sales and stop focusing on the profit and loss. As of, what is it? March 13th? March 16th, when the economy close, it became an economy of a balance sheet. Is my company, do we have a good company? You'll see it on the balance sheet. Adam: (09:43)And I can imagine even during this time of this pandemic that we're in right now, a lot of people are having to relook at their balance sheets and see what's really going on, right? Vidal: (09:54)A lot of business owners or even a good CFOs, sometimes we don't care or we didn't care about the balance sheet. The balance sheet is a mess, and now that we're going to start cleaning it for some of our company's clients, they're going to be like, Oh wow, what hit us? We tend to  hide everything on a balance sheet. But now we need to review it and clean it and make sure that the company's worth something. Adam: (10:27)Definitely when, especially if you want to come out of this on top, because a lot of companies are struggling because their revenue is going down, because they're not getting the same sales, because the economy is just all over the place right now. Vidal: (10:37)Well, if your sales are going down and you're in the service industry, you're doing something not right. Adam: (10:46)What if you can't be open? Vidal: (10:47)If you can't be open and your revenue is down, you're doing something not right. You need to be, and I had a meeting yesterday with some of our clients and they will be, Oh, we're planning, we're cleaning, we are reviewing our systems and procedures, and I said, stop. Stop there. If you're doing that, I would suggest closing and shutting down the company because it's not time to be doing that. It's time to be focusing on your new business model and moving forward with that business model. It's been five weeks since we shut down the economy. It's for you, time to execute the plan, not start planning. We had ample time to plan. It's time to be executing our new normal, our new business models. Adam: (11:38)I think that's a great mindset. So, so let's say somebody has not, is not in a place to execute their new business because they didn't plan to approach. What advice would you give them to saying, okay, how do I move forward now, because I want to be at a place where I'm executing, I want to go forward and not look backwards. Vidal: (11:53)I understand that it's a very difficult and crucial clients. Uncertainty it's all over. Okay. And most people are not driven by uncertainty. The majority of us are driven by certainty. So with that said, if you are paralyzed, if you don't know what to do, you need to find different sources or avenues from your same business that you can offer to your current clients or to your new client model. Let's say that you manufacture windows and you only sell windows. There's tons of opportunities of things that you can offer to your current clients or new clients around your windows. Cleaning windows from the outside of the houses, blinds, films, a lot, a lot of things, like you need to think outside the box. Our mentor, Tony Robbins and a lot of people might know him. He talks about the two millimeter rule. We are only two millimeters away from thinking outside the box. Don't think inside the box, you'll die. Adam: (13:06)So speaking of the future, what do you see the economy, what do you see this, you know, what do you see the landscape looking like on the other side of this? Vidal: (13:16)It's going to take time to come back to where we were the day that we shut down. But, as a lot of economists have said a V-shape recovery. So I think that 2020 is going to be pretty much one of the worst years in history in our economy for businesses, for everything. But starting third quarter, we're going to start seeing recovery. We don't, we need to not get desperate. When we get desperate, we, don't think we just execute actions out of desperation. We need to think, we need to get us do a step back and really analyze whatever we're going to do? What are our actions going to be? And we need to think of the future. And the future is not as as, as great as we think it could be. Again, it's all on us. We need to be accountable. It's all on us. If you need help, ask for help. That's one big problem that we all have. We are so not wanting to ask for help, because we can do it on our own. It’s not true. We need to ask for help. Closing: (14:43) This has been Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Sandra Clarke and Blue Shield of California in the news: Blue Shield of California Updates Details on Financial Support Options to Healthcare Providers in Response to COVID-19 Crisis In the News: Blue Shield of California Offering Financial Support to Providers, Sandra Clarke Tells The Wall Street Journal FULL EPISODE TRANSCRIPTMitch: (00:05)Hi everyone. Thanks for coming back for another episode of Count Me In. I'm your host Mitch Roshong and this is episode 69 of IMA's podcast. Today's conversation is between my cohost Adam and Sandra Clarke, the CFO of Blue Shield of California. Sandra talked to Adam about the value of crossing finance and innovation for the organization and finding the proper balance as a leader of the firm. Keep listening for more insight into how to bring innovation to your company. Adam: (00:39)So to start off, what would you say are your guiding principles when it comes to finance and innovation? Sandra: (00:46)I'd say my guiding principles are that it has to be a partnership that you have to, as a finance person, find the balance between the business strategy and the financial discipline and how you can help innovation weave into those things in a balanced way. So that, that's a very key thing for me. We have to be drivers in unleashing that, that slice of genius that exists in everybody. We always have to do it in support of business objectives and execution still matters. You, you have to be able to execute on this idea of dreaming up lots of cool ideas on a whiteboard is a lot of fun, but you have to be able to turn them into something that's useful for the company. And, finally, I would say an underwriting guiding principle at all times as you cannot assume that what you are continuing to do or you're currently doing is riskless. If you are staying in your same way of doing things and not paying attention to what's going on around you, that can be just as dangerous as going and trying something innovative. So the better answer is to be bold and to strike that balance. Speaker 1: (02:07)I think that's some great advice to be bold. So then what counts as innovation in your organization and how do you define it, and what does innovation mean for your employees? Speaker 2: (02:19)Innovation is a real buzz word at the moment. If you were to do an internet search, I actually did this at one point. Google has over 2 billion results for the word innovation. So I'd say that it means a lot of different things to different people, and you have to be careful that you define it in a way for your organization that's meaningful because a lot of employees hear that word innovation and think “uh oh” this means job cuts coming. And it may mean that jobs change, it doesn't necessarily mean that the jobs go away. I define innovation as something that is novel and useful. So it could be a new way to work. It could be a new way to save money, or it could be a reinvention of something that you're currently doing, but it has to be useful as well as new. And new can be defined as, completely never seen before, or it could just be a significant and enhancement to something that you're currently doing. But the key is that in addition to being a breakthrough, it has to be a useful breakthrough. Innovation just for the sake of coming up with a cool new toy isn't beneficial to your organization, and a lot of times that's the balance that you have to strike that I was referring to before. Adam: (03:42)So we live in very uncertain times, and so what should leaders be thinking about when it comes to innovating in the face of things like recession or just not even sure what the economy is going to look like on the other side of this pandemic that we're in? Sandra: (03:56)Well, you still have to do innovation. In fact, I would say right now, especially in the current environment, innovation is even more important, because we're all finding that we need to rethink how we do our jobs, how we go to market in an environment where you can't do as many things in person. And so it's important for companies not to completely pull back on innovation in this type of an environment, but you might have to refine your priorities and pare them down. So you might've had 10 projects out there for innovative ideas, new initiatives, and maybe you scale that back to three or five and you do more frequent check ins, give them a little bit less time to evolve before you make a decision on what to move forward, modify, or stop the investment. So that I think your, your level of rigor around what you consider acceptable parameters might change a little bit. And again, and again and again, I will say it still has to fit with the business strategy and your company's objectives, and that's even more crucial now because you're going to be refining what those objectives are potentially, as I said, to address the new ways of going to market or the new ways of working, and you need to make sure that you don't continue with the project just because it's somebody, darling and you make sure that it's still going to sit. And so that's where that re-prioritization comes in to make sure that you are using your innovation energy, and I mean that from a people resource perspective as much as a money perspective that you're using it wisely. Adam: (05:46)Definitely. Are there some examples that you can give about, ways that you've been able to innovate? Sandra: (05:53)Well, within my finance team we rethought how we do our close process and shaved about a third of the time out and we're going to try and get another 25% out by the end of the year. And so I think that's one example of, I'll call it in place innovation where you're taking a process that by and large has to exist and finding ways to do it differently so that you can make it better. And that's allowing people a lot more time for analysis and a lot less time on transactional work that's not meaningful to them or to the business. That's one way. And then we, within Blue Shield have a big process transformation initiative that has a number of different pieces in it to try and improve the digital interface that our, our members and our customers and our providers all see, as well as improving the, the way that people do their jobs so that they have more transparency, more automated tools available to them so that they can provide real time information back to people out of one source of the truth. Some of this has been in the works and evolving over the last couple of years and we have a big push to make significant breakthroughs over the next two to three years in a few of these areas, and so that's innovation that we will continue regardless of what's going on with COVID or the economy. Adam: (07:25)I think that's great. I think the biggest thing that the COVID is probably teaching a lot of peoples that, that human to human, that people are important that we should, we should value a person or maybe even over commerce at times. Have you seen that as well in your organization? Sandra: (07:41)Absolutely. We are trying to make sure that we are, are, we remain fiscally prudent, but we are doing it in a, what I would call a thoughtful manner. So my CEO has committed that we will not do layoffs, as, as he has said, we can't promise that forever, but, while we are in the midst of this event, we do not want people worrying about their jobs. We've implemented things like an additional public health leave option. So if you have someone, a loved one in your home or a near family member who becomes ill and you have to care for them, you can take time off with pay. We moved a significant number of people to telework who had never teleworked before, and in addition to providing them with the hardware that they needed to do that job, we are also providing them with a subsidy to cover the, phone and the internet charges that they may be incurring as a result of this change. So I feel that we've done a number of things to support our employees by giving them tools, giving them financial support, giving them financial stability in order to make them feel as secure as possible. And I would say that it has been very effective because our productivity is higher than it's ever been. Our customer satisfaction surveys are showing much higher results. They've been steadily climbing, and you would have expected potentially a dip in service level and in customer satisfaction over the last couple of months with what has been happening, and instead it's continued to climb. And I think that speaks to the confidence and security of our people and the pride that they feel in working for an organization that's continuing to do these things to support the, overall community out there. One of the things I like about doing innovation within Blue Shield is that it's a mission driven organization, and so when you are working in some companies, and I talked before multiple times about how the innovation has to sit with the business objectives, we have a really clear mission around how we want to change the healthcare delivery system, and it makes for a very bright line when people are talking about innovation projects. Does this hit that bar? Does it help us accomplish that? And that type of, clear, well understood, long-term vision is really important for the entire employee base, not just when it comes to proposing innovative initiatives, but in terms of how they do their job and focus their priorities every day. And it's nice because it's a reinforcing mechanism on both sides. Adam: (10:39)Now, you've already touched on this, but how would you approach the balance between fiscal prudence and the risks involved in driving toward innovation? Sandra: (10:49)Well, as I said, doing something the same way, continuing to do the same process over and over is not riskless. So you have to have on some structure around your innovation. It's not, oh, let's go, as I said before, you can't just go draw things on the whiteboard and say, oh, this looks really cool, let's go do that. You have to have defined innovation pillars. You have to have defined priorities around categories. What size are you willing to take on, timelines. You need tracking mechanisms for internal initiatives and external initiatives, and those mechanisms are likely different. You also have to distinguish between experiments and pilots. And experiment is something that you give a very small amount of seed money to see if it's even possible. A pilot is something that you are more confident in the technology and now you want to test it out with more than maybe one or two samples, but it's not ready for full scale prime time. And you have to have decision rights, a RACI, in place. And those are the kinds of things that enable you to have enough discipline and enough fiscal responsibility around innovation to make it a repeatable process and still be able to continue driving the change in that direction that you're seeking to go. Adam: (12:14)Sandra, what are some ways that Blue Shield is innovating during the COVID-19 crisis? Sandra: (12:21)There is one other innovative initiative that we've put in place recently in response to  COVID that I do want to brag just a little bit about because it was a real partnership between finance and the business and that's our provider, financial assistance program that you may have seen because it's gotten a bit of press. And the idea behind this is that we are, offering four different programs to help providers who have been negatively impacted in the financial sense from the COVID shelter in place restrictions. So we came up with a way to offer, as I said, the idea behind these four programs is that this can't be one size fits all. Different providers have different needs and their practices are structured in different ways. And so we took those things and we looked at what's good for healthcare in the long run, and one of those things is a satisfied and viable provider base and created these four different options for providers and put a process in place around how we could execute this in less than a week's time. The whole idea germinated in a 30 minute conversation between our CEO and me one Sunday afternoon, and we were ready to put it into place by the end of that week. So that's where when you're really focused on something, you can come up with new ideas to respond to a need in your environment, and the fact that we've done this and we've now been able to help a number of providers out there feels really good. Closing: (14:12)This has been, Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Miller & Company, LLP: https://www.cpafirmnyc.com/FULL EPISODE TRANSCRIPTAdam: (00:06)Welcome back to episode 68 of Count Me In. IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson, and today we'll be listening to an important conversation about the tax implications and guidelines for individuals and small to midsize businesses following the various government loans in response to the COVID-19  crisis. Paul Miller is a CPA with over 30 years of experience in the accounting industry. Keep listening to hear how he's been advising his clients during these uncertain times. Mitch: (00:41)All right, Paul, so to start off in general, you're an accountant from the clients that you work with. What are some of the trends that you've seen, whether it's individuals or businesses following this COVID-19 crisis? Paul: (00:54)Everyone wants to know how to or have obtained the Paychecks Protection Program and what it means to them, how they have to spend it. That's been the general focus of the last two weeks, and it's very demanding. I've been engaging a lot with an employment attorney because a lot of people are, they have to be very careful that this is going to be scrutinized at some time, and they have to be sure that they follow the first set of rules. If they got the first trench of money and the second set of rules, they got the second trench of money. So you have to navigate them, and I'm trying to navigate it the latter  because I think that's more conservative than the first set of economic rules. So I've been referring clients to a SBA attorney and I've been referring clients to a labor attorney, and simultaneously we've constructed, and we're going to launch it today, which is an spreadsheet that gives people, not an official guideline but like a checker so you could keep track of where you're at, where you're spending is at, where your head counts at. That's, that's one of the most important things today that most of my businesses are focused on. The people who actually went out and got the money. I did have two or three clients obtain the loans and return them for their business is not in economic uncertainty anymore. Mitch: (02:23)So, you know, particularly in the US we here are very familiar with the stimulus package, you know, these government loans you mentioned and as a result of that or you know, on top of that, we've also recently seen the extension of the standard April 15th tax deadline. So that's been pushed back and you know, with your clients and everything you're working with these attorneys, what does the tax deadline mean now for everybody? And really, I guess you could start with the individual, or wherever direction you want to go. But what can people expect from this extension? Paul: (02:57)Well, it's definitely great. There's two schools of thought, right? The people who all money and the people who are getting a refund. The people who are getting a refund want to file. The problem is if your return contains any paper documents, your return is not getting processed. The IRS has made an announcement that they're not processing manual returns. So, you know, if you have any manual attachment or you have to file by paper, you're not getting a refund. For people who owe, and you would have voted on April 15th that extends everything till July 15th. So there's no penalties, no interest. You go to July 15th. There are States that have a broken from the federal government that a lot of your audience needs to be aware of. For example, New Hampshire is expecting their tax return on June 15th. DC expected their first estimate on April 15th. So you have to pay attention to where you file. You have to pay attention is the extension for not only the federal, and has the state connected with the federal and decided to align themselves and not break from, and have you have a separate filing, puts you under  distress. Mitch: (04:12)And what about from the business side effects this small to medium sized firms. Let's say you receive some of these government loans. What does that mean for your taxes and your filing and everything else you need to be aware of? Paul: (04:27)Well, again, this is fluid, so it's changing every day, right? So as of today, the money that you received, is  not taxable. The expenses that you pay, are not deductible. And the difference that you're not forgiven is a loan over 24 months at  1%. Mitch: (04:52)So many of our listeners are management accounts, right? They're really focused on the operations, the strategy within the business. With this kind of money, and there's different stipulations as you've just outlined for us, what does that mean to their day to day roles? You know, within the smaller business, even if you're a sole proprietor, as far as the planning, overall performance of the business, what are you recommending to your clients? Paul: (05:19)There's two schools of thought. You know, if you took the money, the money was to bring your staff back. Okay. Again, it's fluid so I'll blend it in. I've been telling people to preserve capital because you don't know how long this is going to last. Access to capital is very important. I'm explaining to people that it's not.... what is your objective? I asked that question to the employee. Is it too forgive the money and you're not worried about your business, or your business is going to sustain and be fine anyway. Or is your concern, I need the cash flow, because another disconnect with this PPP program, the Paychecks Protection Program is the government has not aligned themselves with the States. So technically from the day you received the money, you have eight weeks to spend it. That really doesn't line up in a lot of States, because a lot of businesses may be a different phase and not open. So you may ask people to come back to work, and they may not want to come back to work. Technically, and I'm not a lawyer, so I don't want to speak legally, but it's my understanding you're supposed to write a letter to the employee saying your job is available, we're willing to pay you, and then you're supposed to notify unemployment and then put them on family leave. This has been a big challenge for a lot of people. Mitch: (06:44)When should a business and individual really seek some additional guidance like yourself here? I know, you've obviously dealt with clients, we were talking about it just before we got on here, all over the place, right? Is there a threshold or a point in time where you say, or you've seen people are, you know, right in time or maybe it's too late before they contact an accountant and start to plan how to work through all these loans and the different tax extensions and such, you know, when is that point in time that you really need to get in touch with an accountant? Paul: (07:22)The minute you have the money. I think if you're not working with your accountant or your accountant is not up on top of this, you're in trouble. You're in trouble. You know, people, there's so much information out there, we send out very limited emails in bulk to have effectiveness so that when people get them, I'm getting calls from other clients who have accountants and so I just want to thank you for your email. I'm trying to give people the guidance that I get, not only from what I read, I talk to clients, I have clients who are lobbyists who are working on the bill. They are working on the revision of the bill. I talked to my friends, the SBA, just trying to get as much information as I can to get my clients as informed as they possibly can. And I think a client who does not seek counsel is, unless they took a little bit of money, they may not have a high risk, but if we took anything over 50 grand or over a hundred thousand, you have to be mindful that everybody above 2 million is going to get audited and they're going to audit small people, and it's not going to be really hard to audit you. You know, this is a headcount driven test, and they're going to ask you for a lot of detailed information. One of the documents I've trying to get my hands on is what does the forgiveness worksheet look like, and that has not been drafted yet. Mitch: (08:50)Sure. So, you know, you just mentioned the audit. What other risks are there for individuals who are collecting this money? Paul: (08:59)It could be committing a crime. You know, I don't think it's the government's intention to prosecute people, but I had a client the other day telling me that they got six point $6.6 million dollars. I told him he needed to get a legal opinion. The woman is a friend of mine. She's a controller of a quasi public company. And I said, you took the money without a legal opinion, and she was like, we're confident that we're okay. I'm like, okay. I had another   person who took $400,000 using the real estate business, he returned the money. A lot of people don't want to go into the government scrutiny. We don't know, there's that old saying nothing's for free. You know what I mean? I would just tell everybody listening to try to pay as careful attention to the law as possible. Mitch: (09:47)So I guess to really wrap things up, you know, from what you've seen, what you envision coming up in the future, what are some of the takeaways that businesses or individuals, should learn from this? What recommendations do you have for future business operations and future handling of money after all this crisis. Paul: (10:08)When the crisis is over, it's going to teach you a lesson. You know, you have to have some bunk  money. You have to be aware of the unexpected living way above your means, which is what the government's doing, and advising clients by having a massive deficit and saying it's okay to spend more than you make. You need to be prepared. You need to be prepared not only for today but for tomorrow to have a certain amount of money put aside so that you can support your staff, and support your business and make capital investments, especially in the time like now. Now I find there's an incredibly good opportunity for people who are, you know, in the professional services business where they should be marketing themselves, not today, but for tomorrow. The SBA attorney that I'm working with was an M&A attorney. He's taken several classes to become SBA and flipped his career for the interim while he's doing SBA work. So there's a lot of things you have to say. So if you know the world is funny, it's, it's not, it's never what it was, it's never what it's going to be. So this is an interesting time going forward where we're going to have harder bank rules to get financial statements. Going to have harder lending rules, what's going to make businesses even harder to get money, even though the government is rolling out the next line of loans, which is the Main Street Lending Program, which will be the next thing that a lot of people will be talking about. In addition to, if you want to talk about it for a few minutes, a lot of people are now being offered their EIDLE loan. A lot of people are now getting the acceptance, and it varies from as little as $1400, i've seen up to $150,000 where it's now capped. And I'm recommending to a lot of my clients, and this, the clarity is becoming, it's becoming clearer that you can take the EIDLE loan and it will reduce, so you will have to refinance your PPP, but you can't spend the money for the same purposes you use the PPP money for. So again, it's not official yet, but that's my understanding, and if that's the case, I'm recommending to a lot of my clients to take the money. It's interesting principle for free and you could prepay it at any time, so I can give you an extra cushion, maybe pay your vendors to maybe pay your suppliers and or market, or do some things that will need to be done to get your business, redirected and back, back up online. Mitch: (12:35)So I guess this will be my last question for you. With all this available funding and lessons learned, so on and so forth. What are the opportunities coming out of this? I know we talked a lot about some of the negatives, some of the risks, but you know, what kind of positives do you see potentially coming out of this? Paul: (12:50)Oh, there's tremendous, tremendous opportunities. There's going to be acquisitions where companies can't survive. You know, there's going to be tremendous buying opportunities. Look where one person loses another person gains, and the person who's in a better financial position we'll capitalize on, on this market. Okay. And it doesn't necessarily mean the rich get richer, smarter businesses that like architectural firms that couldn't do it on their own, maybe they group their businesses together and they work better together to bring in jobs and cross over, you know what they do. A lot of different things. There's going to be a lot of activity in, either M&A or an acquisitions or restructuring businesses. That's what I see. I think it's going to be, well, you know, once we get through the downturn and people, this is pushing the digital age forward faster, and it's going to teach, people are gonna need to retool themselves, being more computer literate and it's going to advance a lot of things that, you know, we were slowly getting there. It's kind of accelerated it. So the, I can do a Zoom meeting. I don't need to fly across the country. I can do the, you know what I mean? Things like that are very obvious that are going to save companies money, but you, the real estate industry will have to refigure themselves out, and there'll be a lot of, figuring going on. Announcer: (14:16)This has been, Count Me In IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Contact Gordon Hofman: https://www.linkedin.com/in/grhofman/FULL EPISODE TRANSCRIPTMitch: (00:00)Welcome back for episode 67 of Count Me In. I'm your host Mitch Roshong, and I'll be bringing you to Adam's conversation with the vice president of finance for SSA Marine, Gordon Hoffman. SSA Marine is a global transportation and trucking firm with operations across five continents. Gordon is responsible for directing the financial strategy of the company and leading people in teams to efficiently move commerce. In this episode he talked to Adam about how organizational culture plays such an important role in employee retention and personal productivity, particularly within his finance function. Let's head over to their conversation to hear more now.  Adam: (00:48)So to start off, what are the drivers that help to create a culture of productivity within an organization?  Gordon: (00:56)Yeah, so there's, there's three main drivers that we're really focusing on right now and what those are is, you know, one is just providing meaning in the work that's being done. If you have people that are just showing up and doing tasks, you find that, you know, they'll start to space out, they're not really focused and then they'll get what needs to be done, done. But there's never really any emphasis to go above and beyond that or look for process, you know, to look for ways to improve. And what we've been doing to bring some focus in that is really just trying to create a connection between the company vision and the actual work, which can be a little bit tricky when you're, you're talking about finance and accounting because you know the vision for our company is we partnered to move commerce with efficiency, flexibility and integrity and at top level that's really kind of challenging too say, well, what does that have to do with finance? But from there what we've done is broken that down and, and really made a trail from our vision, which, how does that translate into values? How does that translate into more core long term objectives? And then finally, what are the strategies that help us achieve those objectives? And once you've done those three, four pieces, it's much easier to sit down with your team and say, you know, this is what we're trying to accomplish. This is how it fits with the overall company vision. And that kind of brings people into the company and what we're trying to accomplish. And so it's, that's a bit of a motivational factor that I think is really important to having people engaged and really thinking about how they can improve and how they can be productive and how they can add value. Once you have people engaged at that level, there's, you know, some more, you know, task related items that we really focus on them, which is one maker productivity measurable. Really you need to have some KPIs. I noticed in the past for us, we were on the operation side very focused on KPIs, the business operations side. But when I actually came to finance and accounting, you started asking about what our metrics are and they were, they're just weren't very many of them. Yeah. So once we, once we've really created that motivation and buy in for the company, you know, coming up with ways that you can actually measure your productivity. Cause you know, a lot of the times on the business side you can really focus on your operations. In our business, what's important is how many containers we've moved in an hour. And so a lot of our business was focused around that. But then when we got on the back end of finance and accounting, we stopped doing KPIs. And so we now adjust that. So those KPIs are just as important for measuring productivity within your finance. It really driving and showing people how you're improving. And then the final item on there is just creating priorities and making sure that you're checking into those priorities on a weekly basis. It's very easy, I've found on the finance accounting side, you know, where are the people that fix the problems and you're always putting out the fires and then you boost focus on really what is value adding. So taking some time on, on a weekly basis to readjust your priorities and make sure that you're focused on whatever those top three items or five items are in the coming week that really can add that.  Adam: (04:20)So now, you know, it seems like everybody in the whole world currently is working from home. How have you been able to kind of implement these things switching to a work from home workforce.  Gordon: (04:31)Yeah. It's interesting that, you know, we were talking about this probably three or four weeks before covid really started impacting everyone who said we want to, we want to be able to make it so that people can work at home and work remotely more often. Cause you know, especially with the younger generations, this is incredibly motivating for them and it's like a value they see in their business. So it's, it really comes around like, but once again, it's like setting priorities and then setting expectations, and then being able to measure them so that because you can't sit down and have a chat with someone or walk over to their desk and have a chat with them and say, well, how are things going? What do you have on your plate? You have to have other ways to really be able to demonstrate that no, you are getting what needs to be done, done. Everybody's on the same page. So in a way it's more documentation, which is thinking a little bit scary because it feels like you're creating a lot of bureaucracy. But by creating that, that documentation, it forces you into like the third item I talked about like, you know, really doing that weekly review of what the priorities are and then making sure that you're staying on task for them. So it really just, the work from home culture has just reinforced that you need to, you need to do this going forward.  Adam: (05:51)So do you have some examples to share of, of success?  Gordon: (05:55)Yeah, so we've got some like really granular levels of examples. One thing that we've found that's been incredibly successful for us is time blocking, where people just, you know, set out like two hours in their day and I'm going to get this done and I'm not going to answer email. I'm not gonna miss chat or anything like that. And you know, when we have people do that and really honor those two hours, the feedback we consistently get is like, I can't believe how much I got done. It's like I was able to knock that out. you know, and it was a lot easier. And I was originally thinking rather than taking what I thought was going to be a full day project, I got done in like two or three hours. So time blocking has been one of the first successes that we've gotten a lot of positive feedback from. The second thing that's been very beneficial to us on the prioritization we as an organization really mix our FP and a or historically we'd mix start FP and a and our accounting groups together in what we were seeing is that there was a lot of conflict in demand for if people's time that that wasn't really effective in actually getting things done. So people were kind of doing both jobs halfway instead of doing one of them completely and we just, we weren't making no, the deadlines that we're expected to make or the quality of product wasn't good. So we ended up really splitting those pieces up and we did that by like just digging into each of those processes and understanding what the bottlenecks were and see that there's, there's not a good resolution for this. If you're putting both of these tasks on one piece, one person's plate, like there's no correct way to prioritize. And looking at those priorities, we were able to say, you know, we have to reorganize this a little bit and put these responsibilities with one person and we'll have someone else really oversee those day to day accounting items.  Adam: (07:51)You know, I think those are some great successes, but with every success comes, downfalls. Are there any pitfalls that somebody should look out for and they're trying to implement some of these suggestions that you've made?  Gordon: (08:03)Yeah, the big one is don't try and implement a perfect system on day one. You, you'll get a massive revolt from your people. you know, there are some accountants I would say that really want a lot of structure in their place, but once you move away from public accounting, a lot of people are trying to get away from, you know, keeping their time and you know, having to log every single hour that they do. And so as soon as you start creating that structure again, there's this just feeling from a lot of people that it's like, Oh no, you're trying to put a lot of control on me and that's really not what we're trying to do. And so, you know, start small and just take like very high level activity that say, I just want to understand. Yeah, there's these seven tasks that we do as a group throughout the month. So high level tasks, let's just record how much time you're spending on each one. Those, once that starts to become comfortable for people, what you ended up then started seeing as you know, all those seven tasks aren't enough or I want to break those seven tasks down. And so you just have like an iterative process where you build out this tracking system. And prioritization system. And over time you can get more and more detailed, but you're not shocking anybody on day one that here comes big brother. We're going to be watching everything you're doing and we're going to be micromanaging you. What ends up happening is people start micromanaging themselves because they see this productivity and this focus and it's like, well, I need to get this done and I want to get that done. I need to prioritize this over this. And they start creating it all on their own rather than having like a top down. The other thing is, is that, you know, one productivity methodology is not gonna work for an entire group. So you need to be flexible on that. When I first started on this journey and I was just doing some research on it and I found that there's something like 20 different philosophies on productivity help there, and there's a lot of overlap between them and you can pick and choose between one or the other. But one of the ways that I read that it's described as you got some people that are very visual, visual, like they just want to have a chart that they can see and it's all written out. Other people are very tactile. They want to be able to move note notepads around or they want to be able to scratch things off. So they actually want to have stickies on a wall where they move one piece to another and another to another. And then there's abstract people that end up doing a lot of it in their head and they just need a couple of reminders here and there. And so if you try and force one of those mythologies on any one person, and it doesn't fit for them, once again, you're going to get a revolt. So you need to be flexible and really focus on what works for each individual and then bring that all up and take themes that come from everyone. And that's kind of your overall philosophy for your group. Adam: (10:52)I think those are some great things to look out for. Just especially the reminder to say, Hey, everybody doesn't learn or go through projects the same way that the next person does and you have to adapt your system so that each person can be successful.  Gordon: (11:06)Yeah, I think that's, that's probably one of the most important things that, you know, you have a lot of individuals in your group and you want to have that diversity in your group, but it makes it a little bit more challenging as a manager because then you have to still, you have to manage to each one of those personalities rather than trying to have just one philosophy for the entire group.  Adam: (11:31)So then how can you ultimately use this culture to drive employee retention?  Gordon: (11:37)So we've been doing some study on retention and you know, like I was talking about earlier it's really, there's this desire for people to work remotely already and the problem that you run into with working remotely like historically has been that people, it's like how do you hold people accountable? how do you know that people stay productive? Cause there's this thought like if you're sitting in the same room with people that you can really stay on top of them and, and that's just not, that's not desirable anymore. People want to be able to work remotely and clearly we're, you know, we're four weeks into coven now and we've been working remotely. We went through our year end audit and we actually added an additional audit to the process and we basically only added one day to the overall audit process and we were one day late and we never worked remote before. So it shows that yes, you can work remote, you can stay productive and so you just have to have these metrics and prioritization and having that available. You've then free people up to get the work done when they, when they can get the work done and still within the timeframe and whatever requirements that you have. The other thing that this helps with, with, retention is really creating more time to work on interesting projects because as you create productivity, you know, it frees up time for people. And I've actually used that as very much as a motivating factor for doing this as a site. But you don't have to be working 60 hours a week. A lot of that time is, is nonproductive time. It's stuff that, you know, we feel like it's important or someone's telling me it was an important, but at the end of the day you can find out, you know, maybe I didn't need to work on that or someone else could have resolved that or you know, it can wait two weeks and I can focus on these other items now. and so we're not, you know, you tell people we're not trying to be big brother here. What we're trying to do is create more time for you and whether that is, you know, to take on more interesting products, projects, or have more time to stay at home with your family, that's really what's more important and meaningful to people. And that's what we're trying to help people do. We're not trying to squeeze that, that last down to every ounce of effort out of them and you get more out of them. That's what we want to create this more work life balance or meaningful balance and interesting projects because there are always going to be projects that are a little bit mind numbing in accounting. There's no way around that, but the less amount of time you could spend on them, the better. And that really gives you time to grow and really enjoy your work.  Announcer: (14:24)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Contact Alain: https://www.linkedin.com/in/alainmulder/Contact Bernardin: https://www.linkedin.com/in/bgeneralao/Coronavirus Update from IMA: https://www.imanet.org/about-ima/jeff-thomson-on-the-coronavirusFULL EPISODE TRANSCRIPTMitch: (00:05)Hey everyone. Welcome back for another special bonus episode of Count Me In. Over the last few weeks, we have interviewed various IMA staff members from across the globe and shared their perspectives on how business in their region is being handled following disruption of Covid-19. We have heard about business continuity in the Middle East and India, China and now today we are going to share information coming from Europe. Adam spoke with Alain Mulder, Senior Director of Europe, Operations for IMA and Bernardin Generalao, IMA’s Director of Regional Partner Relations. For more global perspectives and business insights. Keep listening as we head over to their conversation now.  Adam: (00:48)So we are going through a globally challenging period and with IMA's regional Europe offices based in Amsterdam and Zurich, can you tell us a little bit about how this region is coping with the situation and what are some of the highlights of government level initiatives being taken?  Alain: (01:04)Well, let me first say that I hope that you are all safe and taking care of yourself and your family as we beat this COVID-19 crisis. And I also want to express my heartfelt sympathy to all being affected by this pandemic, and also the loved ones of the ones who have left us. So IMA’s approach to this challenge has been simple, to demonstrate social responsibility for the safety and wellbeing of our stakeholders, including our staff, professionals, and students in more than 150 countries, and of course our partners. Before our local governments decided to call a lockdown, we already decided to start working from home and not from the office anymore. So like I said, the wellbeing of our stakeholders is our priority, and in the first week of March, for example, we had many conferences happening across Europe, including Switzerland and France, and we immediately decided to cancel these events to make sure we, our members and stakeholders are all safe. Of course, it is very unfortunate because I was looking forward to these events for months and the teams and speakers put a lot of efforts into the preparations. But we have to take our responsibility during these difficult times. In Europe we currently have approximately 1.1 million COVID-19 cases, and especially Italy and Spain are heavily affected.  We saw most European countries have observed decreases in daily number of newly reported cases in the last two weeks, and as of April 22nd 20 countries had decreasing 40 day instance with 19 countries reporting a current 14 days instance below 50 cases per 100 K population. And although the composition and intensity of implementation for all European countries, entity UK, if we introduce a range of non-pharmaceutical interventions such as stay at home policies, recommended or enforced, alongside other community of physical distancing measures such as the cancellation of mass entering and closure of educational institutions and public spaces to reduce transmission. So while uncertainty remains about the extent to which the combination and intensity of these measures impact transmission in several countries here in Europe, certain measures are associated  created at least temporarily with decreases in the number of newly reported cases at the population level. So also transmission rates within the countries are heterogeneous and even in countries with high incidents of COVID-19, there are areas where sustained community transmission has been halted or strongly reduced, and countries with appropriate measures in place as well as in areas where transmission has declined or remain low probability of infection with COVID-19 is currentlyin his assessed low. And in many European countries we see the early signs of post-lockdown rise in activity and governments are now taking first steps reopening societies and economies. Here in the Netherlands for example, elementary schools were reopened for half of the time, and also other countries are now reopening.  Bernardin: (04:33)Well here in Switzerland and an easing of measures in three phases was introduced end of April. So public institutions, schools, private businesses are scheduled to reopen with three-week intervals until mid-June. There are various guidelines and regulations towards social gatherings and onsite events. So similar to most countries, physical distancing measures are highly recommended and also followed by the public. So as Alain mentioned, we have all had to act fast and remain vigilant. Hard to say that any organization was prepared for a pandemic and we are privileged to be at an organization with a high level of readiness for this unusual time of crisis.  Adam: (05:15)So as leaders in this region, you guys have had to make some difficult decisions to ensure that business continues and the staff is safe. What have been some of your guiding principles during this challenging time?  Alain: (05:28)Well, like I said, the wellbeing of our stakeholders is our priority and our senior leadership and our President & CEO, Jeff Thomson, has been very clear from the beginning, the wellbeing of our stakeholders is our number one priority, and that has always been the guiding principle for me. Safety is above commercialism and therefore we postponed our events across Europe, and we immediately started working from home. We are very fortunate that our organization was well prepared for that, and we used to work from home remotely while traveling and have all the systems in place.  Bernardin: (06:05)Well, I couldn't agree more with Alain. As cliche as it sounds, safety first is more prevalent than ever. Worth noting aside from the behavior for organizations, every individual reacts differently to this punctuated equilibrium. Prior to this current situation, there was a relative period of stability contrary to where we are now, where there are periods of rapid change. So for many individuals, this pandemic has been a period of loss, for example, with regards to normalcy, safety and livelihood. So consequently one should be mindful or at least familiarize themselves with the grief cycle from Kubler Ross. The grief cycle is stages of denial, anger, bargaining, depression, and lastly, acceptance. Any individual or organization you're dealing with can be in any one of these stages. So what I'm saying is remember to be empathetic, or more empathetic than usual.  Adam: (07:05)I think that's some great advice Bernardin. We're all, we're all dealing with differing levels of that grief cycle as we're dealing with the loss of normalcy and this new normal is taking over. So how has IMA adapted to this new situation of working remotely? I know Alain you mentioned that IMA was very well prepared for that because a number of people do work from home at times, but how else has IMA adapted?  Bernardin: (07:32)Well, IMA immediately adapted to the new situation of remote work. So as a global organization we have been monitoring the effects of the pandemic on our colleagues located in other offices where COVID-19 had previously reached peak levels. The Zurich office is in the center, which means that my commute includes public transportation by a bus, train, and trams, and of course I wanted to avoid all of that. And the company directive to work from home came regardless, so I was never in a position to feel that I was being an inconvenience to our processes. I also traveled frequently within central Europe to manage relations with our stakeholders, which means that working from a cafe or hotel or a train or plane, on my laptop, cell phone or tablet was more or less normal for me. Personally, remote work did not present much of a transition. That might not be the case for everyone, especially if one is used to having a routine commute on a daily basis. For most professionals in these times, they're not only working in a new physical environment, but more importantly in a new emotional environment. So this also means that the motivational stimuli in this new way of work have to be adapted as well. And IMAhas given us a chance to climatize, particularly with regards to work life boundaries. So most working professionals have additional obligations during this lockdown. Children are homeschooled, so you have to be the teacher, and the elderly need extra support in errands, you know life as we know it now.  Adam: (09:12)So how was IMA managing this task at hand? What are some of the immediate actions you've taken?  Bernardin: (09:18)Well, our stakeholders have been very appreciative and cognizant of our actions. In this time of need, we definitely want to be there. We want to help those in the accounting and finance profession, cope with the disruption caused by the COVID-19 pandemic. As you know, IMA has made many valuable education resources available, free of charge to the greater community for 90 days. And the variety of resources provided to nonmembers include select learning products, publications, and career networking resources. So we believe that committing to being a learning individual or a learning organization and education is part of our social responsibility. As an example, a classroom and teaching resources for made readily available for academics, besides the virtual CMA info sessions we have conducted at dozens of European universities in recent weeks we have also launched the new IMA Data Analytics and Visualization Gundamentals certificate as well as Blockchain 101 just recently and both have been well received in thousands of finance and accounting professionals have already completed it as a means of continuous professional education. Now in addition, our member volunteers and chapter leaders from Switzerland, Germany, Amsterdam have facilitated several webinars with current topics to keep the engagement level high among IMA members. Most events have been converted into a virtual format providing the flexibility we all need. The IMA, Switzerland chapter, and this is brand new, is organizing a virtual management accounting conference on June 17th with presentations from renowned speakers, a round table discussion and a keynote speech from IMA’s Global Chair Elect Paul Juras and a virtual networking feature within the event. So if you're interested in learning more, do follow our channels.  Adam: (11:18)So to kind of wrap things up, what advice would you give to other regional and global leaders going through the same challenges that you are currently?  Alain: (11:25)Well we have all been united in our effort to understand and come to grips with the COVID-19 crisis, and as a leader you now have to think about the safety of your staff. We also have to make sure they feel safe to do their work and make sure they can work in comfort and take care of their family. We ask our team in Europe if they have everything at home to do their work safe like equipment and if not, we made sure it was delivered. As a leade,. you now also have to understand that there is no strict difference between work and private anymore. So don't make a fuss about it, if you children in a conference call, we all understand. Also trust your stuff, I see tremendous motivation and work gets us in my team. So my advice for now is to be a servant leader and trust your team. And I'm confident our team will come out of this situation stronger than effort and we will hit the ground running when this is all over.  Announcer: (12:27)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

John’s website: http://www.johnstretch.com To view a selection of blogs visit http://www.johnstretch.com/blog You can find more examples of the author’s writing at these two websites: https://cfo.co.za and https://fpa-trends.com Also visit https://cfotalks.com/podcast/29-john-stretch/ John's recent book: https://www.amazon.com/dp/B086D93NPW/ref=sr_1_1?keywords=the+hidden+balance+sheet&qid=1585295817&s=digital-text&sr=1-1John’s YouTube channel: https://www.youtube.com/channel/UC4MvDaja0Ua50Quvk-3NY4AContact John Stretch: Email - stretch@global.co.za     LinkedIn - www.linkedin.com/in/john-stretch-272a475  FULL EPISODE TRANSCRIPTAdam: (00:05)Welcome back to episode 66 of Count Me In. I am your host Adam Larson, and today you'll be hearing an important episode on ESG and the unique topic of stakeholder capitalism. Mitch spoke with John Stretch, a published author, lecturer and business consultant specializing in management accounting. John writes and facilitates workshops for various professional institutions with experience across many different industries. In this episode, he explains what the CFO's role is in managing stakeholder capitalism and increasing the value in the organization. Let's hear what he shared with Mitch now.  Mitch: (00:47)So as I said, if we can first explain what stakeholder capitalism is and why it's so important.  John: (00:56)Mitchell, stakeholder capitalism is another way of thinking about how we manage organizations, not just corporations, but all kinds of organizations. And in a nutshell, it says dont took it all for the shareholders, leave something on the plate for customers and workers and employees and communities and even societies. It says doing good is good business sense, and another part of the stakeholder capitalism is that managers should take a view on longterm sustainability, not next year when they make decisions. And as a consequence develope better corporate governance to make to make those decisions. And you can ask, so what's the payoff? aAnd the answer is, there's a carrot and a stick. The big carrot is that  stakeholder capital is going to make your company worth more in the long term then pure shareholder capitalism. I mean you just need to look at the high market to book ratios of top hundred companies who reinvest the profits in building brands and tech and know how rather than distribute them. And of course share prices are based on prospects of intellectuals as well as physical capital. In the old days we used to call that Goodwill, but today we classify intellectual capital into four groups of human relationships, structure and natural capital. And the stick is that if we adopt the diverse view, we can say that the old movement, Freedman idea of profit without social responsibility as in fact led to responsible decisions, inequalities, damage to the environment, and so on. That's the viewpoint, and so why is it important now? Because since the turn of the century, the world economy has been, it's changed. It's been based now on intellectual, not physical capital. And we know that the value of intangible assets has grown much faster than tangibles, even if it's not all reflected on company balance sheets. And it's actually been proven, there's a, it's a book that came out last year. Capitalism without Capital with two economists have actually proved that intellectual capitalism is growing much faster in the world than the tangibles. So to make the world a better place, make your company more valuable, you should build a combination of different kinds of wealth and stakeholder capitalism has got this vision of a responsible future in which short term thinking would actually be  replaced a bit of long term thinking.  Mitch: (03:26)Now on this podcast we've had a number of conversations about reporting for ESG, and you've mentioned a little bit of ESG data already, and my next question is how do these types of capital that you are mentioning and talking about here really impact sustainability and the integrated reporting? Once again, particularly trying to give it a little bit of a finance and accounting perspective.  John: (03:50)Okay, well, you know, I think of two overlapping circles, but for me ESG is, is more about the stick than the carrot that I mentioned earlier. ESG, Isabel sustainability. It's something that was coined in 1994 to describe as we will know, the, the ESG, Environmental, Social Governance, factors that not managers, not accountants, but investors should consider when they measuring the long term viability. So they talk about natural capital, diversity, human rights, consumer protection, and corporate governance of those things. So it's about protecting society, and so ESG today is about sustainability and corporate responsibility in the context of the fourth industrial revolution. And what are the ESG people come up with? They've come up with more reporting. So at the January, 2020 meeting in Davos, the world Economic Forum Table, this framework for reporting ESG aspects of business performance and risk, put together along with the big four accounting firms, and it says that companies should report more information, wage rights, local jobs, created gender differentiations. There is massive amount of detail here, and this revised framework is at the proposal stage. And in my view, it's going to take time to be accepted by the accounting bodies around the world. It doesn't address the cost of the systems for collecting the data and whether the the measures should be audited or whether it only apply to public companies and acceptance hasn't been universal. So it's going to take a bit of time, but on the other hand, integrated reporting and integrated thinking is the carrot, which is the other part of the circle, and, of course, managers want to measure the performance of their brands and their research and their software and their knowledge. But as you and I know, the financial accounting systems and not always very helpful and sometimes a bit contradictory, accounting by its nature is a conservative discipline. It's intended to be there all the influences of the income tax and the statutory financial reporting and the stock exchanges and so on. But intellectual capital, assets like recipes and brands, trademarks purchased from other firms,we sell the fixed assets and we write them down over the useful life. But if we do these things internally, we call them sum-costs and they included operating expenses. And so now you get a situation where the, the market value of companies is like 20 times the value of the tangible assets because everything's been written off. So the accounting profession has responded to this, this, this whole thing was saying, look, the financial reporting is one thing, but we have to have a disclosure process called integrated reporting. So open above the audited financial statements, we've got these integrated reports which communicate an organization strategy and governance. And so this leads to creation of value in these six capitals make them worth more and eventually to driving a share process. And that's integrated reporting. But reporting success impacts the share price. It impacts the decisions investors make. And so there's two integrated thinking is really the developed to address the process because it involves enormous trade-offs. The decisions that trade offs, the governance that build these forms of capital. You can't keep everybody happy all the time, and so you take them all into account and you make the trade offs. And if you want to see how companies look at those things and do those reports things. A lot of US companies are doing a very good job. Look at Coca Cola, look at Verizon, look at entails lost annual reports and you'll see that they've got a long way down the road in terms of integrated reporting.  Mitch: (07:46)So earlier you mentioned particularly environmental capital and you said we would get to that. So I would like to bring that back to light here. I know at Davos as you were talking about stakeholder capitalism was huge and everything you're talking about here, you just summarized everything very well, Bbut another big point of emphasis was climate change and other things that really affect ESG particular to environmental capital. So why should companies really be concerned about this environmental capital and how do you suggest they go about, you know, this awareness and whatever change it is implementing that for their organization.  John: (08:24)Mitchell, I'm very glad you brought it up because it happens to be a hobby horse of mine and also something in which I'm near, which I've done some interesting professional work. So yeah, some companies in countries regard reducing the carbon footprint and reducing reliance on fossil fuels to be a grudge purchase, which has imposed by the authorities wile others see us in ongoing and voluntary commitment. But in a word it's managing for sustainability. There are three issues. There's first of all, controlling sustainable consumption. The second, preservation, maintaining biodiversity, and particularly the climate change being driven by the cheap fossil fuel. And the third area is rehabilitation. So then the question is how do you get companies to actually do it if it's a grudge purchase, you know? Well-governed companies should recognize that longterm sustainability depends on management and preservation of the natural capital. It's not just them, it's also right through the supply chain. You know, if you a manufacturer motor vehicles, the person who buys the vehicle is the person who actually puts the emissions into the environment, but you're just as responsible as the manufacturer. So how do you do it? Well as an example, I've been working for some years with a company in the fishing industry here, and the fishing industry is controlled by quarters and the quotas are allocated to individual companies on a year or 18 months basis, and it was a mess. Companies were managing for the short term over fishing the resource, poaching, under declaring the catches and so on. And this company put together a plan and went to the authorities. Tt was a 15 year plan and they said, if you give us the rights to a little piece of ocean for 15 years, here are the capital investments we'll make the kind of tool is the kind of technology, the kind of people that we will do to conserve the species. And they got this 15 years and today they're fishing a healthy and sustainable and paying stock. So it's really about you need to take a longterm view, and the authorities need to take a longterm view if you're going to have sustainable consumption and another part of this is the controversial topic of emissions trading. So, a way of processing those greenhouse gas emissions where people can actually trade the limits or the quotas if they come in under the limit that was given to them. And as I say, some people are in favor of this thing. Some people, others, I think there's tremendous potential for potential there. We probably don't have time to go into today, but imagine a world where you pay, shall we say $10 extra for every wine bottle that you buy. And you know that if you take, take it back to a particular place, you get five or $6 back and the other $4 are going to transport it back to the original manufacturer of those glass bottles. Who's going to rehabilitate that class and put it back into the system. So it's the same principle as the trading, as the emissions trading where you actually monetize the rehabilitation. Okay. And then the third part is of course rehabilitation itself, which nowadays, if you're going to get a mining license, you won't get it unless you've put in rehabilitation plans. And I think what I was stressed about as it has an impact on us financial professionals and data collection is absolutely crucial in managing natural capital, and it's quite challenging for us because it leads us into new scientific areas that we aren't necessarily used to.  Mitch: (12:23)I would like to wrap up this conversation and a lot of great information being shared here, but once again, very specifically to our management accounting audience, our finance and accounting professionals, the top of the organization from our function, the CFO, you know, what is their role in managing stakeholder capitalism? John: (12:56)There are three things that I talk to my clients about, and the first one is culture. Someone's got to lead this, this, the creation of an intellectual capital culture that says that these things are valuable, sustainable, where the company's got to go in the fourth I R and so on. And the person who needs to lead that is the CFO. It's not the CTO, it's not the marketing manager, the brand manager. It's going to lead the creation of that culture, and I'll explain why in a few moments. And they've got to create that awareness. Firstly amongst the accounting stuff and then the rest of the organization. This is where the future lies. Accountants need to become evangelists for integrated thinking, to ensure the company manages those tangibles actively not passively. That's the first principle, and the second thing that intellectual resources, even if they have been written off for years in the books are valuable assets, they're not costs. So those are the principles, the cultural principles that you've got to put in into the organization, driven by the CFO. The second thing is the management system. We experts at building management systems. We know how to do strategic planning, budgeting for costing, performance measures, management reporting. We are experts at that, but you need to tweak your management system so that you can measure and control all the elements of an organization. Six capitals because the management systems as you well know have been based for years on just one which which is actually financial financial returns. nd companies like Apple and Microsoft have actually gone a long way down the strip.Which I'm going to share with you when I answer the  third question about making companies company's intellectual capital more valuable. So the third thing then in terms of what's the role of the CFO is to start building the right people. So the accounting staff should lead by example. . I’ve said, they need to be evangelical, and the business world is going to change very fast and get tougher. We've all read about this habit of lifelong learning, but it's absolutely essential, and what I say to accountants, you've got to learn to think like an entrepreneur. An entrepreneur takes total responsibility for themselves and for the organization, and for servicing their stakeholders, and that's the attitude you have to adopt. And so in return, of course, the CFO has got to demand there's very high levels of effort and performance from the staff because they are in themselves forms of very expensive forms of intellectual capital, and the company invest a lot of money in them every month. But in the same way that the CFO and the company has got to demand high levels of effort from these intellectual capital resources, the accountants themselves should make equally hard demands in the organization for job satisfaction and stimulation and growth and so on.  Announcer: (16:06)This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

About Patricia Werhane: https://giesbusiness.illinois.edu/profile/patricia-werhaneArticle About Patricia Werhane: https://giesbusiness.illinois.edu/news/2019/10/01/werhane-tackles-tough-ethical-issues-for-gies-studentsFULL EPISODE TRANSCRIPTMitch: (00:05)Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. We are here for you today with episode 65 of our series. As we've addressed in many recent episodes, the Coronavirus has affected various aspects of accounting and finance. Today you will hear Adam speak with Patricia Werhane and adjunct professor at the University of Illinois, Gies College of Business and a fellow for the Center of Professional Responsibility in business and society. Patricia is also a co-producer of an Emmy award winning documentary television series in the Chicago area titled Big Questions. In this episode she talks about the ethics of commerce during these difficult business times. Let's head over and listen to their conversation now.  Adam: (00:53)So today in the podcast we have Patricia Werhane with us. Patricia, thanks so much for coming.  Patricia: (00:57)Thank you for having me.  Adam: (00:59)Now, Patricia, you've been speaking lately about ethical dilemmas facing the global economy in light of the pandemic that we are in. So I was hoping you can share some of those insights with us today.  Patricia: (01:08)Let me start by posing the question and then I want to give a couple of quotes from people who support that. So the real question I think we're facing right now as you know, how should we balance public health with the pandemic and social isolation with the financial health where massive unemployment will be economically disastrous? In fact, it already is. So is this an either or and we see this in the news all the time or is there a middle path? Let me give you two contrasting viewpoints. The first is from a Lieutenant Governor of Texas, Dan Patrick, and he argues that Americans should go back to work even if that causes the deaths of their grandparents who will willingly sacrifice their lives for the sake of economic growth. Well, I know some grandparents who may be not quite so willing, but we'll see. Now on the other side is Governor Cuomo from New York, and you know, of course who he is. He says, given the choice between economic prosperity and the preservation of human life, every life is worth saving at whatever costs to the economy. Now you can see these two balancing and contrasting views and we hear about them in the news all the time and we hear our governors and our presidents going back and forth about this and the center for disease control. We're just caught up in this dilemma, so I want us to think about the dilemma and then I'm going to make some comments about it and then we'll come to some sort of resolution. I hope.  Adam: (02:45)I was wondering if you could tackle the local identity versus the inner inactivity and the dependence on global commerce issue.  Patricia: (02:51)This one of the important things to think about in this dilemma, and you all know this, I'm sure and that is we live in this global world, although we focus locally on the people who are ill and some of them are our relatives and our friends,O f course. We are globally independent economically. There's an enormous interconnectivity in goods and services. For example, most of you are on your iPads or your cell phones or your computers. All of those are made with parts from many countries of the world. And I don't recommend taking them apart and looking whichI have done with an old cell phone and you can't tell where the parts are from actually. They're not all marked. But Dell computer for example, says their all their computers are made from parts from 22 countries. So you can see this interconnectivity and look at your clothes. I'm wearing clothes from Vietnam, Bangladesh, Korea, and Italy. I won't describe which ones. I don't have one single thing on me that is made in the United States. Over 20% of our food is imported. I hadn't realized that. The ventilators and the respirators and the other health care equipment we desperately need are made in parts from all over the world. Now this means that we have to think very carefully about this challenge. And as Martin Luther King actually said, some in the 1960s, if you can imagine, he says, we live in an inescapable network of mutuality. And that's that network in which this pandemic is, you'll remember that we all thought it was a China problem, but of course as we know it's a global problem. It's not just China.  Adam: (04:36)Then what's your theory on the perspective we should take on this issue?  Patricia: (04:40)How? How should we think about it? I'm a, I'm a business ethicists. I'm a professional ethicists. I think about these problems all the time. So I'm going to present us with kind of three perspectives from an ethical point of view that will help us think through this problem that I've created for us and actually I haven't created. It's been created and I'm just talking about it. The first is obviously we all know about this is basic human rights. In the United States, we have a bill of rights, but in 1948, the United Nations developed the universal declaration of human rights and everyone, every member country is supposed to sign onto it. Not actually they do sign onto it, but many of them forget after they sign on that they actually are supposed to enforce these rights. But anyway, the basic rights are obvious, the right to life, but also the right to survival. The right to survival means I have a right to work, to do whatever I can to survive. And then I have the basic freedoms, freedom to speech, freedom of movement, freedom of religion, or not, freedom to worship or not, freedom to work or freedom not to work actually, and many other rights. Actually United nations is very nice and said, we have a right to a vacation, but of course I love that, but I'm not many people honor that. Right. Actually. And then interestingly, because many of you are in business and commerce, in 2015, the United nations developed a protocol, a voluntary obviously for businesses arguing that the role of business is to respect, protect and remedy abuses of human rights wherever they are in operation, wherever they're operating. I think that's very interesting. It means that organizations as well as individuals have basic rights, but they also, we have obligations to each other. One of those obligations is to respect the dignity of every single human being. Sometimes, of course we don't. The second principle to think about is fairness. There are endless, endless literatures on fairness. I won't inflict on you, but one of the basic ones is to treat every person as an equal. Now that's the principle underlining delivery of healthcare. We don't have enough of anything. We don't have enough ventilators. We don't have enough respirators. We don't even have enough room in our emergency rooms to deliver healthcare to every person who needs it. So in the healthcare thinking, they do triage and you probably all know that that is, they take the, if you think about the people who are coming in, they take the sickest people first and also those who are likely to survive. So if you're very, very sick and you're not going to make it, you will be put probably in down back in the line. And this is the idea of treating everyone as an equal and trying to raise the sickest who are possibly going to survive up to, shall we say,well, we're, I'm not sure what normal is anymore, but at least to a decency so they can live. Now, interestingly in commerce we also have that principle of fairness. That is to treat every person as an equal. That is to give every individual equal opportunity, but in commerce we don't hire the sickest or the weakest. Obviously we hire those we think are the most qualified, so we see this treatment as an equal, as as defined differently in different contexts. Finally, the third principle philosophers call is utilitarianism. Well, you know that's a huge long word and one one doesn't have to remember, but you all know this as cost benefit analysis and in commerce and in the triage, in health triage, we are using that principle. In the triage, we're obviously doing cost bumps, which ones of my sick patients can I best serve, can I best cure, can I best help or can I best ameliorate their harm or their pain? Now that is a cost benefit analysis and also in commerce of course we do that all the time. That is we aim to create value added for all our stakeholders, including of course our owners or shareholders. And that is the idea of trying to maximize benefits or health versus sickness or hurt harms to either to just help people or to society in general. Now let's step back for a minute and do a thought experiment. Suppose many of you are accountants and suppose you know how to do this much better than I do a cost benefit analysis of and suppose you come up with a conclusion. I suspect you might, if it's just cost benefit of finances, that will be financially more feasible to go back to work and send back to normal unquote wherever we were before, what January or February of this go back to work, even if it costs us a number of lives.. Now, some of you aren't going to like that. You're not gonna like it because it doesn't put human beings into the equation and any utilitarian says no, you can't just leave human beings out of the equation. Even if you're doing costs and benefits. That's whatGovernor Cuomo would say. So where are we? How are we this Groundhog day? Are  we backto where we started, where I started. I don't think so. So let me step back a minute and argue. We have, as a result of this analysis, we have not one but two moral imperatives. The first is obvious. The first is from a human rights perspective and fairness and a cost benefit analysis to reduce the pandemic infections. Maybe of course the idea, the ideal is a virus. I mean, sorry, it is a virus, sorry, a vaccine that will eliminate them eventually.But there's a second moral imperative and that is to continue and encourage global commerce. Now, why is this a second moral imperative? It is a moral imperative for at least three reasons. First of all, without, without working, people suffer enormously. We're seeing people here who don't have enough food in the United States of all places and they suffered terribly without working. And also they suffer human worth. People like to identify, people identify with their work and what they do and when they're not doing it,it's a terrible psychological crisis as well as obviously an economic crisis. The second reason is with massive unemployment, we consumers will have little purchasing power and if we don't have purchasing power, then global commerce will shrink. And so what? So I'm just projecting in the future we'll have no imported food, no imported clothes. Oh, I have to go back to sewing my clothes?And worst, will have no new electronics. And that will be very difficult. Think if those of you, some of you have been to Cuba where the cars are 1950 cars, but are sort of glued pasted together with rubber bands and masking tape and they make their own parts. Why? Because they're not allowed to import any parts, and their cell phones are well beyond empty and it's very difficult to get the internet there as you, those of you who've been there, have tried. and, We won't live that way. We can't live that way. We don't want to live that way. And so maybe I'm going to have to go back. My great grandmother made soap and candles for heaven sakes, as well as her own clothes. And most of us aren't going to go back to making candles and we probably shouldn't. But there's a third, and this is the more most important imperative. We need commerce to provide the necessities to address the pandemic, hospital beds, masks, gowns, ventilators, respirators, and new medicines all often, many are imported. We can't, we cannot solve the physical pandemic without global commerce. Those two are interrelated. I have separated them out, but that's wrong. They're integrated, the pandemic needs global commerce, global commerce needs business. So we've got two basic imperatives that overlap with each other. Adam: (13:28)So then what do we do?  Patricia: (13:31)How does one deal with an either or situation? It's tempting to get locked in this. Oh, I should do this or do that. But if we can take five minutes, just five minutes of your life and step back for a minute and think about this. All of us are pretty smart. We can figure this out,. But if we get caught in this either or, we're unable to think clearly. So we need to step back and take a pause. Take a breath if you like and think for a minute. Is there another way to solve this dilemma which doesn't sacrifice global health or financial disaster? Now I will tell you if an autobiographicallynot too long, that when I began thinking about this, I got caught in miss either or, and I know this, this isn't right, but what, what should we do? And then I came upon the writing of Paul Romer. Paul Romer is a Nobel prize economist at New York University, and he proposes what he calls and what now others are adopting with, by the way, without giving him credit, the middle pack. He said, if we spend so much money anyway, obviously a hundred million dollars right now, sorry, a hundred billion dollars right now and get masks for everyone, which we don't have,as you know, in this country and testing equipment and test, test, test everyone. Everyone gets tested and protect ourselves. That is wear mask, wear protective gear. We can all go back to work. He says, and this is a quote from him, so at offices, manufacturing plants, service organizations and even restaurants where every employee manager and customer will be tested. So you'll be tested as you enter the restaurant, you'lltemperature will be taken. And if we all wear protective gear, commerce can can begin. He says at the rate it was before the outbreak. Now that may be optimistic, but it certainly can go ahead with this. And interestingly, the center for disease control and some other experts have arguing,wWe need, think of this 30 million tests a week. Now there's what, 330 million people that's country give or take or maybe off a little. So that would take a 10 11, maybe 11, 12 days to test everyone. But right at the moment we can't do that because we don't have enough testing kits. By the way, interestingly, we have plenty of labs. Universities have labs that are underutilized at the moment. There are labs that are all over the country. That could be doing testing. All they need is the equipment to do so. And of course, all we need to see equipment to be tested as well. So this can be done. This isn't some wild idea, but it's something that we really can do and we can do it well.  Adam: (16:31)Do you think people would actually go for that? The governments and everybody and the local governments would actually go with that plan?  Patricia: (16:38)I actually do because I think we're all, I think particularly, I think most of us are afraid. We don't say that, I think, but we know, for example, employees who could go back to work and are afraid to, we see that in the meat packing industry because there's been so much virus in those meat packing plants because they're so close together. It's not really the plant's fault, it's just the way it is that we see employees who don't want to go back, even though they have jobs and because they're afraid. And they should be afraid because of the last enormous infections in those plants. Interestingly, Volkswagen, we all know  Volkswagen are in Germany now has opened a factory again to make cars. And this time you at home, before you go to work, you get dressed up in protective gear. When you get there, your temperature is taken. If you have a temperature, of course you go home, you come into a protected absolutely clean factory that's been cleaned during the, between shifts. Then you take your shift but you're put six feet apart, you wear protective gear and masks if you get any closer to anyone. And then they have, so they've slowed down the assembly line obviously, but then they have a lot of robots and they of course don’t get the virus. And then between shifts they take a long break. Usually it's just, you know, five or 10 minutes, they take a long break, reclean the place and then start again with new people who have been tested. And I think, I haven't gotten the latest report, but they're going to try this, and I think that that work, that will work. And we can do this and I think people will be if they can go back to work and know that they're going to be fairly safe. If I can go out to a restaurant of desperate of course to go to a restaurant, if I can know I could go to a restaurant and I won't get ill. If I can walk down the street and say hello to people instead of ducking under my mask. I think people want to do that, but they want to be safe as well. So I, I'm pretty convinced and I know we can do it. We have the capability to do this. We haven't done it yet, but we can do it. So just to conclude, notice that when we're stuck in an either or situation, there are solutions to this and I think this is a solution that will address both the pandemic and the financial disaster that is going to continue to occur if we don't go back to work. But Romer argues, and I agree with him, that if we do one path, if we only focus on health or we only focus on finance, that will probably fail at both of these.  Announcer: (19:28)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Rohit Thakkar: https://www.linkedin.com/in/carohitthakkar/FULL EPISODE TRANSCRIPT:Mitch: (00:00)Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong. And today we're going to hear about the popular topic of business partnering. Adam spoke with Rohit Thakkar, finance business partner at Adobe to define the role of a business partner and explain how you can guide the business with strategic decisions. So now let's head over and listen to the conversation.  Adam: (00:35)So Rohit, how has the business partner's role become a navigator or copilot for finance in the organization?  Rohit: (00:43)Yeah, it's a great question. So think about it this way, the traditional roles within finance are changing and evolving and one such role is that of an FP&A which is evolving, you know, into a finance business partner profile as well, from just a traditional FP&A a partner who was supposed to, you know, do reporting for the business. Now we are looked upon and rightly so should be the trusted partner for various business organizations that we support to succeed in this profile I'm absolutely convinced of being a friend. Now as they say a friend is not the one who is, you know, has been the longest with you, but who can be relied upon to keep various, you know, various teams grounded in expectations, show the true and fair picture and who can manage to tell the right business story and bring the right business conversation into context. Navigated by definition. You know, if you go to a dictionary you will find the definition itself by means that who can direct the course of the ship by using various instruments and devices. Now in a corporate setup, that role, the ship becomes a corporate, the corporate becomes the ship. The route is the direction we are heading to and finding ways, on where we want to reach that instrument and devices are, you know, the final business plans and the financial plans that we are talking about. And we develop through the course of, you know, our journey into the financial planning. Now a critical role is that, you know, it entails a lot of work in joining various dots within the organization. I'll give you an example here, we undergo extensive process of planning exercise that requires us to understand the overall market opportunity. It actually starts with, you know, understanding that time of the market. So, you know, time is nothing but total available market. So we need to understand as finance business partner, what our overall market opportunity is, you know, we need to have an extensive analysis and understanding around how much penetration do we have in those markets. Where do we stand?Where do we want to go? What kind of a product fit that we have in all those markets? What are customers? What kind of needs that we are trying to address with our products? What is our competitive landscape? Now that's where the actual financial planning activity should start. From finance business partnership point of view. Now it's easiest said in like two or three sentences, but it really requires a lot of work, you know, do analysiskind of get into the surveys and you know, get the survey results, interpret those surveys. And you know, I tried to create customer segmentation for your own products within the organization. So the second thing, you know in this product, you know in this roadmap is you know, understanding about the product roadmap is very important. It's essential for the business partner to understand the vision of the product managers and the business unit. It is important at this time also to factor in what it will take to realize the product goals during thisexercise of what we call you know the planning exercise or the partnership. It becomes important as next logical step to understand and work upon our pricing and packaging. That is where a close coordination is required.= with another dot in the matrix organization like say, Adobe, to work very closely with the product marketing management teams. We chart out our plans aroundt how much unit, how much do we want to drive, how much are we going to generate and achieve those targets R.ealistically.We need to chalk out plans around how we want to market the product. Suppose, you want to grow a product by say 40% in Iran. Now how many units should expect to sell? What kind of efforts would be required by say, you know, various other teams like web sales teams.go to market team, phone teams, partnership teams, that we will need to materialize and achieve those targets? Now joining these dots across organization and ensuring that various parts of organization understand their financial contribution responsibilities and in turn leadership signing off, giving them a priority to execute two plans is the most critical role as a finance business partner.  Adam: (05:37)So you've really kind of shown how finance becomes that business partner to the whole business, how it connects to each little section and that kind of goes to guiding the whole business. So what does that finance business partner's role when it comes to developing something like KPIs?  Rohit: (05:54)Yeah, it's a fantastic question. You know, let me kind of, you know, define what actually the KPI is. You know, KPIs by definition are those indicators that organizations should choose very wisely to reflect the actual performance. And they should be forward-looking. Theyshould be something that should be measurable, right? So, you know, it's super important for us to not just get bogged down by the financial KPIs, but to understand the relevance and the need of business KPIs. So business KPIs ideally should be forward-looking, especially in a matrix organization, you know, like, like Adobe. We tend to, you know, drive over planning activities by data key metrics, DCI. So what that stands for and it, you know, you can find that in six Sigma literature, but wedefinitely practice that is who's going to be the driver? Who is going to be there approver? Who's going to be the contributor? and do we need to keep informed when it comes to, you know, informing the reserves? So it becomes super important for us in matrix organization to ensure that we are able to derive responsibility assignment metrics as well from the Nike exercise. Now rule of finance is to sit across the table, bring folks from all across the organization and work to create those KPIs, to understand the role for themselves in setting up those business KPIs. Now we cannot just set up the financial  KPIs and say that, you know, we can't be the monitor and say that, okay, go get the results for us. We need to be super practical and understand what kind of business KPIs we need to drive to get to our financial KPIs. Financial KPIs, so there's a circular reference if you have to, you know, think about it this way. There is a circular reference between financial KPIs and business KPIs. At one end you have financial KPIs, which are kind of a derivative of the business KPIs and on the other end, you know, think about that financial KPIs should be influencing your business KPIs as well. So I'll give you an example on one of the key financial forward-looking metrics that we definitely look for in the subscription business. That's the  ARR, theannualized recurring revenue. That's considered to be much more forward looking compared to the revenue or the top line. Now the role of finance business partner actually goes beyond setting up this financial KPI. Think about it this way, it is kind of similar to activity based costing where organizations should move to activity-based revenue or top topline planning to identify the drivers for the top line. Let's say, you know, you are an eCommerce set up base company. Now, the most important thing that you would want to watch and be careful about is tracking the traffic to your website, and how good they are able to convert such traffic. Now in that case kind of case scenario, the business KPI would be traffic,would be your conversion rates and not just the financial KPI what ARR that you want to drive from the website. I had a great opportunity of working with the company Freescale as well. So Freescale was a spin off from Motorola, so it was a great company. You know, quite the learning experience for me myself. Whenwas looking at R&D effectiveness metrics and so you know, one of the tasks that I was working on was creating the R&D effectiveness metrics for the entire organization. And in turn I realized that the entire value chain for a semiconductor chip actually has a lot of variation from an automotive chip that it's like ayear to develop and two years to get into manufacturing versus the wireless kind of a setup chip, which would take like six to seven years to deliver the results. Now, you know, I started mapping out the process right from the wafer size and I realized that just the costing of, you know, the per unit costs just doesn't make sense to me. In order to ensure that I am able to effectively, you know, find the business KPIs and mapped out the entire process and figured out that we need to set up business KPIs around what kind of wafer size we are targeting. Then define the assembly and test use, not just the cost, what kind of a year we are targeting from our back-end as well as front end manufacturing units. What kind of burning time is required? What kind of packaging is required to deliver a zero defect package reserves. So that becomes the part of an entire playbook. I'll give you another example and it goes to the, you know, it goes to the usage of the product. Now if you can map the usage of the product and you can identify how engaged your customer is, a typical business KPI in that scenario would be NPS. It serves a good, you know, net promoter score it serves as a great metrics to identify how loyal your customer is to the product. Of course higher the better. But what finance business partner must understand is the trends and impact on retention of those customers to have a better recurring revenue impacting the lifetime value for the organization. So that's super important for us to understand how are we setting up KPIs, identifying what KPIs need to be said, not just for the financials but for the business.  Adam: (12:20)I think those are some great examples kind of coming in altogether. So just kind of putting this all together with all the financial business partners acting as navigator for the organization, how do you recommend somebody can bridge that gap between this long-term strategic plan? You know, a lot of examples you just kind of gave with the short term goals, the daily operations and the more traditional responsibilities. And then how does that person, you know, become that business partner if the organization doesn't see the finance as that business partner?  Rohit: (12:52)Yeah, I mean, you know, there's a fine balance and you know. I think at times we confuse ourselves and you know, as our role as finance business partner for just the long-term vision perspective, and I would believe that you can actually be a finance business partner in the short term you know scenario as well as the long-term scenario. So we work on the long-term strategy and then the short term goals and the natural delegator of the long-term strategy. Just as in the case of any, you know, of defining those long-term strategies, the finance jockeys are required to coordinate with the product PMMs you know, the product managers and the teams across. The short term are MVPs ( think this is what he says) the finance business partners or the finance jockeys. They have, you know, they must ensure that they are partnering very well with the sales and marketing organizations, with the go to market teams that are required to deliver the reserves. So, you know, when it comes to responsibility, these teams are responsible to deliver the results. But it is very, very important for us to ensure and understand what our expectations are, how realistic those expectations are,nd we have a continuous dialogue and continuous conversations with those teams. It is also important that those tasks for managing short term results. They must have the right feedback, you know, they must have the right channel of giving feedback to the teams who are managing the long-term goals so as to ensure that we are, you know, keeping abreast of our performance and ensuring that, you know, if there is anything, anythingthat can be flagged off, you know, like really early. That will be great sign for the longterm strategic planning teams to figure out how do we factor those in and account for them.  Just as the critical role of finance isit's equally important that we go to markets and sales teams, it must be recognized. We must support them to support the overall longterm vision, We must support them in the, you know, the short term scenario. The delivery of short term goals are super important for a sustainable value creating business in the long run. You know, to sum up, I would say that finance business partner profile is it kind of a very forward looking profile and not just a reporting profile. So you know, a lot of folks get bogged down by reporting in the short term and that's exactly not what it just needs, it needs you to u plevel your conversations in the short term as well as the longterm and ensure that you have a continuous dialogue across organization to influence, participate and modulate these business strategies to support the overall vision and purpose of the organization.  Announcer: (16:01)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

IMA's Website: https://www.imanet.org/Coronavirus Update from IMA: https://www.imanet.org/about-ima/jeff-thomson-on-the-coronavirus

International Management Accounting Day: https://www.imanet.org/about-ima/international-management-accounting-dayIMA's website: https://www.imanet.org/About IMA: https://www.imanet.org/about-imaFULL EPISODE TRANSCRIPTAdam: (00:05)Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world and happy international management accounting day. Every year. On May 6th,, IMA celebrates this global day of recognition to commemorate the important role management accountants play within their organizations to help bring more light. To this day, our cohost Rouba Zeidan spoke with IMA's President and CEO Jeff Thompson. Let's listen to what Jeff had to say about today and how the management accountant is even more vital during today's uncertain business environment.  Rouba: (00:43)So today IMA Institute of management accountants celebrates international management accounting day. This is a global day, which recognizes and commemorates the important role that management accountants play within the organization. What does this day really mean to you?  Jeff: (00:59)Well, the day it means quite a lot to me. from a relative perspective is up in my top three or four or five days. You know, my wedding anniversary probably, I have to say for the record goes up above. The day I earned my CMA is way, way up there. So way, way up there all seriousness, is international management accounting day because it tells me and it tells us that we've arrived as a community, we've arrived as a profession. We make a difference. We make a difference in people's lives, we make a difference in, organizational capability, as not only stewards of the business, but value creators of the business. And as we've seen through, the events of the Corona virus global pandemic, we make a difference for society, capital markets and you know, management accounting. I'm still in some markets it's not totally understood that accounting is that how, why do we call it management accounting? But the fact that we have an international management accounting day set tells me that we have long arrived as a profession that makes a difference and does a great things for individuals, organizations and society at large.  Rouba: (02:31)Excellent. So since its inception in 1919, so that's just about a hundred years ago. Ima's been actively supporting the evolution of the profession through thought leadership, bridging the skills gap and building a strong network around the world. But what is the core role the organization is really played in bridging the transition into this digital age that we're currently experiencing?  Jeff: (02:55)Well, number one, we're very, very proud to have just turned one hundred years, less than a year ago. So we call it 100 years and counting. But we're very, very proud of our first hundred years on the legacy that we've built contributions, service to society. But we're also very, very excited about the path forward. First and foremost, I would say that IMA has always stood for ethics and when you think about ethics and financial reporting, think about, ethics and, budgets and forecast, strategic plans and all the things that creative accountants do. Ethics, we've always stood tall on ethics. I've had an ethics committee for decades. We've had a, we've had a statement on ethical professional practice for decades. We've have educational programs and trainings, for decades and that has been one common denominator that has propelled us first 100 years.  Rouba: (04:05)Beyond having, I mean, this is a favorite part for me beyond having some of the coolest accounting figures in the world. So the likes of Robert Plant of Led Zepplin, Mick Jagger of the rolling stones and Janet Jackson who studied accounting in college. I mean is management accounting still an in demand profession in the face of automation and the likelihood of hundreds of thousands of jobs being annihilated from existence in the next decade.  Jeff: (04:31)There's a lot of risk and opportunity for our great profession of accounting and management accounting. I tend to be the optimist, but I'm only the optimist if we have a sense of urgency and a call to action. And here's what I mean. Accounting is actually a cool profession. We do very, very interesting, type of work. Some of it is could be routine and more mundane, sometimes, putting counts together, the financial reports and transactions. Sometimes that could be mundane. But, we also, do some really, really interesting work in data analytics, risk management, in technology. You know, the CFO team over time has evolved from being strictly in the accounting lane, the accounting zone of accounting for the past. But over time they've evolved to not only accounting but an interdisciplinary approach to the business. Talking about the CFO team, not just accounting, but finance, not just accounting and finance, but add operations add technology, add strategy. So today's accountant, today's CFO has to know something about all of those domains to create value across the supply chain. And so that requires not just an interdisciplinary approach to the business on how value is generated, but up-scaling.if we upscale, in data analytics, in data visualization, in strategic management, we will continue to have a relevant and influential profession.  Rouba: (06:15)So across every sector and industry around the world, CFOs, controllers, budget analysts and accounting managers use financial data to inform organizational strategy and value in the face of obviously intense competition, uncertain global economic conditions and disruptive technologies. But when you contrast this with the current global pandemic, which is unprecedented, and it's set to bring forth one of the worst and most challenging economic outcomes since the 1930s, what value can the profession continue to create, if at all?  Jeff: (06:48)Well, I think this is an opportunity actually, and a challenge, for the CFO, the CFO team to shine. This is happening at Ima with our CFO, Doreen Remmen, happening around the world. You know, in times of stress and disruption and grave grave challenges, whether it's a world health pandemic that started out as an outbreak, then became an epidemic and then a global pandemic that shut down essentially has shut down the world in many, many ways, very tragically. That of course that has dire and direct economic implications. The opportunity for the CFO, CFOs around the world are rising to is, you know, we rely on our CFO and the CFO team to enable and create strong balance sheets, strong working capital, liquidity options, sources and strong liquidity in general. You know, their day to day work, which sometimes doesn't get recognized, creating budgets and a cash position and sound investments and a pathway to the future. Sometimes that day to day work is not necessarily recognized, but in a global pandemic where you have to rely on your balance sheet, your cash position to, see you through the rough spots so that you come out of it stronger. CFOs typically have direct or indirect responsibility today or operations strategy, even human resources. So you think about, all that we can and should be doing to make sure that we retain a talented workforce so that when we come out of a global pandemic, we can hit the ground running. We can eat that pent up demand. We can take that we've learned about ourselves and how consumers behave in terms of procuring our goods and services, and take all of that and create even a stronger rebound, but you have to have the ability to weather the storm. through, courage, courageous leadership, through sound analytics and savvy business judgment and who better than the CFO and the CFO team in being that guiding light, or service or growth and for recovery, quite frankly.  Rouba: (09:34)And while we're on the topic of, of the pandemic, how is IMA supporting management accountants around the world at this time where obviously they need all the help that they can get? Jeff: (09:45)Absolutely. You know, from the very, very early stages, IMA's view is we are going to treat this global pandemic which absolutely shocked the world and its depth and breadth severity. It's very, very tragic. I'm speaking to you from, one of the epicenters, here in the US global pandemic, where 300-400 people are dying every day. Even though it's beginning to tail off, imagine that 300-400 deaths a day. So early on we said, we're going to be IMA. We're not going to change what IMA is all about. we are going to, put social responsibility first. Social responsibility for the safety of our great staff around the world, for our partners for our members, for our volunteers. Social responsibility, first compassion over commercialism, prudence over panic. And that has manifested itself in many ways because we are a community the very first discussion we had on this podcast was about IMA, andinternational management accounting day and the fact that we are celebrating a community, well that community includes staff, members and board members, et cetera, et cetera. So for staff, we closed our offices early, earlier than most and our offices are probably going to stay closed longer than most. However, we've got a great business continuity plan. We're all serving members from home. We're very, very proud, to make our members around the world aware of our hardship policy. They ever need to, relax or reduce their for a period of time. Do that. We have offered a whole suite of freeeducational programs and promotions in this time when you're at home with your family, what better time than to, take courses, study for the CMA or the CSCA take advantage of are well over 100 credit hours of free CPE. Including, courseware and strategy, competitive analysis. Our new certificate program in data analytics, is still free to members. So, you know, that is our part, as I said, at putting compassion over commercialism. Our small business committee has offered, guidance very very very (he says something that breaks up)to small businesses on how they could cope, with all that is going on and perhaps come out the other side stronger because let's face it, wherever you are in the world, small businesses are disproportionately  impacted. Small businesses as we speak, are going out of business or can't pay their employees or laying off or furloughing. It is very, very sad, but we have to have that glimmer of light at the end of the tunnel. So, we need to put back compassion first and foremost, in working with our members, offering, and making available free, courseware, and much, much more, on longterm members, and part of our, great, great IMA community and ecosystem to know that we care. We're thinking about you and we're in this together. We're in this together, but we'll come out of this together and even stronger.  Rouba: (13:51)Yeah, because you, you speak of the, the SME sector and indeed, I mean, the world bank states that 90% of businesses and more than 50% of employment worldwide, particularly in emerging markets are SMEs. So how do you believe the sector is going to survive when they're impacted the most, under these extreme global economic conditions?  Jeff: (14:15)Yeah, absolutely and, you know, there are, there are no easy answers. When one day the global economy is, overall doing pretty well, I would say. And the next day virtually flipping a switch, is shut down. You know, it's interesting when we talk about, whether it's the Westor Dubai or China, yeah. Things are beginning to open up again certainly in China, which is very heartening and lifting. The US, state by state slowly is beginning to, open up, but it's not flipping a switch to turn the economy's back on. It's going to be based on cases, remediation of these cases  and prospect of a vaccine much, much more. But when you think about it, the shutdown was flipping a switch, virtually flipping a switch from lights on and glowing and bright, and exciting and hiring to, a complete shutdown and unfortunately there are consequences and, innocent victims quite frankly. And so the more we can do as a global society, as IMA, to enable, (he says something here but it breaks up) small businesses, as I said, IMA is doing its part through our small committee and others to help provide guidance and thoughts, you know. Obviously having a strong balance sheet. I mean IMA is small business. We're Global. We have offices all around the world, but we are a small business and so we are in the throws of facing those same challenges.  Rouba: (16:10)So during a recent virtual town hall, which by the way, I'm really enjoying those town halls. It's a way of staying connected to the team globally. You said something that stuck with me. So as we emerge from this critical chapter of our lives, we need to get out of it much stronger than we were before. So what are some of the lessons that you think that we stand to learn about becoming more resilient and a more sustainable organization?  Jeff: (16:39)Great. Yeah, and there's many elements. You know, it's kind of interesting. Probably no one would disagree with the statement that, or the assertion that we're going to come out of this stronger, that could apply in your personal life or it could apply in your business life. It's great to be the optimist and to aspire to great, great outcomes even if things are not looking good. But, you know, when we talk about coming out of this global pandemic even stronger, you have to start with the fact that you want to have a company together to come out of the pandemic before you even talk about being stronger. The stark reality is you have to have a company, right? So in terms of weathering the storm, again, here's where the CFO, the CFO team played such a integral role as well as other members of the team. And that's to make sure that in good times and in bad you've got enough cash reserves, you have financial safety margins, you have liquidity, you have working capital, you have a strong balance sheet. That's not a guarantee. It doesn't make you immune from pressure, but it surely can help. But in terms of coming out of it stronger after, you know, here at our financing and our liquidity and our working capital in short term, I'd say there's two elements to come out stronger. One is a genuine people first approach and two is a commitment to learning. So on the genuine people first approach, and again, everybody says we are people first. People first. Well if your first action, regardless of your short term financial position is to, lay off fire cut salaries. And I realized that in some small businesses just for survival, that may have been unfortunately necessary, but it's really, really important to take the view that it's people that fuel organization. And if we really want to come out stronger, we want to keep that inspired group of people, letting that inspiring and inspire talent together, so that when we come out of it, we can not only be ready to rock and roll per the coolest accountants, symbolism. But we're ready to roar. We're ready to rock and roll, to meet that pent up demand. When economies open up and the world opens up. You know, one of our members, in response to one of our free educational offerings, I think it was the data analytics certificate, that we just rolled out, said words to the effect, thank you IMA for helping me grow when the world isn't and so that little beacon of light, that little source of inspiration, really, really shines true. So it really is about people first, whether it's your staff and keeping them safe and secure. About members, making sure you've got a business continuity plan in place to service them and their needs, perhaps in times when they need us most and much, much more. And then in terms of the second main ingredient I would say to coming out stronger is, committing to be a continuous learning organization. We are learning so much every day, about each other as teammates, about our members, and their needs and wants and particularly stressful, an urgent situation. And we're learning a lot about technology and collaboration tools. We're learning a lot about remote work, perhaps this will lead to some new normals, some new abnormals, some of which will be very positive about and others that we may want to evaluate, but it might create a whole new model of how we work and how we engage, but only if we learn, and talk about that what we've learned that could propel us into a great, great future. We will come out of this. it's been tragic. as I said here in New Jersey when, good news is a day where we have under 300 deaths, that tells you how tragic and sad this is and how we must always be on guard. And, I know that world health community is learning an awful lot, that we as citizens of the world hope, take tangible action. But we can do our small part and, from an IMA perspective, always exemplify courage, care, and conviction of purpose.  Announcer: (21:58)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

CyberCecurity, LLC: https://www.cybercecurity.com/ Video Training by Ray and Mitch: https://www.cybercecurity.com/media-and-speaking/ Mitch's Blog:  https://cybercecurity-mitch-tanenbaum-blog.com/ & https://mtanenbaum.us/ Contact Ray Hutchins: https://www.linkedin.com/in/hutchins/ Contact Mitch Tanenbaum: https://www.linkedin.com/in/mitch-tanenbaum-2589663/FULL EPISODE TRANSCRIPTAdam: (00:05)Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. Cybersecurity is something that truly affects management accountants, but really all individuals and firms. So Mitch spoke with Ray Hutchins and Mitch Tannenbaum about what cybersecurity really means and how to acquire the appropriate knowledge to be of great value to your organization. To hear why you need to understand cybersecurity. Keep listening as we head over to their conversation now.  Mitch R.: (00:40)All right, so at a high level, how does cyber security really impact the finance department of an organization? You know, why does this stuff really matter?  Ray: (00:50)Well, from Mitch and my perspective, of course we're cybersecurity guys and we're also business professionals. So we've been in business all of our  life  we are a  couple of boomers. We've got a lot of experience and we know that and we deal with a lot of companies. Where the, all the cybersecurity, the risk questions, the risk questions are dealt with and delegated to many times. The finance department, finance takes control in a lot of organizations. They haven't spent a lot of time setting up their internal, authority around, well, who's gonna be responsible for the risk and compliance for the organization? Who's going to be responsible for cybersecurity and privacy. And so in a lot of organizations that falls naturally right onto the finance department and specifically the CFO. that's been a problem we've dealt with in the past many times in an organization saying really the CFO shouldn't be the one in charge of all of this. You know, there definitely play a role. Of course they're always important on it, but there's, there's more people need to be involved in this, but that's the nature of the beast. The finance department is involved, they pay for it, they're accounting for it, and therefore they need to understand something about it so that they can participate in an intelligent level in conversations around this risk category.  Mitch T.: (02:30)Let me add something to that. Every organization has a chief risk officer. Now, in many organizations, that person doesn't have that title. But in every organization there is, somebody is responsible for that. Whether that's the CEO, the COO, or more often the CFO. If we assume that cybersecurity is a business risk that needs to be mitigated, just like every other business risk. And if we assume that the CFO, is the chief risk officer, in fact, then it makes perfect sense that the CFO and the finance team needs to understand cyber risk to be able to lead the conversation. They don't need to be the experts, but they need to understand how that ties to business risk.  Mitch R.: (03:19)So these are all really great points and I really like the idea of, you know, grouping this together as a true business problem. It's not an it problem. And if the CFO is going to act as this chief risk officer, as you said, really manage, you know, the risk initiatives here. What specific type of information do you think the CFO or their finance team needs to acquire in order to effectively lead this risk mitigation and implement these cybersecurity procedures for their organization?  Ray: (03:53)Good question. And it brings up something, you know, both Mitch and I have, my Mitch, my partner Mitch as opposed to you, Mitch. But, both Mitch and I have of course spoken at multiple IMA meetings at this time and we're familiar with IMA as an organization, as something that we find out there in the IMA organization. You've got a lot of executives and transition from one company to another and within they're moving up in their career and whatnot. And something that I have found to be the case is when I'm talking to these people out there is that, and I make the point that as a financial services professional, no matter what your rank, no matter what your position within the organization you can make yourself much more valuable to the organization if you have a business grasp of cybersecurity and privacy and is in business implications and you can speak the language, you've got some jargon, not technical jargon, just general jargon about it. Perhaps knowing some of the regulatory environment, knowing some of the regulations and the standards that affect all businesses, kind of understanding that and being able to engage on that companies have a terrible shortage of anybody who can talk the talk of cybersecurity and privacy. So if you can demonstrate any level of competency, any level, well that changes your value proposition within the company.  Mitch T.: (05:27)So I would say that, just like any other risk problem, you want to create a governance risk and compliance framework, a GRC framework. And the good news is the federal government and the guys of the department of commerce, National Institute of Standards and Technology has created a great governance framework, which is the NIST cybersecurity framework. And as of this past January, it's partnered the NIST privacy framework. These are governance frameworks, high level governance frameworks that every organization needs to be looking at. And I will tell you, and we do a lot of work with this, nobody is a hundred percent when it comes to these frameworks, but the framework provides a set of guidance for organizations big and small. So if you go look at policies for example, and it ask questions about policies, well a small organization is gonna need a different set of policies than a big organization, an organization that operates in multiple States and multiple countries might need different policies than  one that doesn't. But if you all lay this into that framework and then you can go off and say, as the chief risk officer, okay, you know, this is a network problem or this is an IT problem or this is a, you know, what level of risk are we willing to assume problem? And you can go off and assign different part, different people in the organization to go help you complete this framework and see where you stand. The first thing that I would always do, and we do a lot of these, is a GAAP analysis. Let's go look at where we are versus where we want to be and we have these conversations and we generate a a list of of gaps and then it becomes a business conversation for the C suite and for larger organizations for the board. Very importantly, the board has to provide guidance on this to say what is a level of risk we're willing to take? And the risks could be a compliance risk. It could be a legal risk, it could be a reputation risk, it could be a whole variety of different risks that we could be taking on. But what's important for every organization is to understand the level of risk that they're taking. Go Look at, Equifax is a great example. The whole Equifax breach started because they didn't patch a server. Now that comes down to having a inappropriate understanding of what is the level of risk of having all these servers  out there and and having a patch management program that works so that it gets into the technical weeds, but you can go look at every breach that's out there, whether it's capital one, whether it's Equifax or these are mega breaches, hundreds of millions of records in some cases, Marriott, Starwood, you know, and you can get, you can create lessons that you can learn. Let's go look at what they did wrong and let's see how we can do things right. We go look at the Sony breach from 2013 you know what was very clear in the aftermath of that breach is that Sony did not have an incident response plan that was appropriate to the problem. Neither did by the way, Equifax in 2018 or 2019 so you know, if you're the chief risk officer and you want to ask these questions, okay, so I just saw this breach that happened to XYZ company in the news. You know, how would we do, let's assume that we got hit with the same kind of attack and it's something that's very much in the news these days is ransomware and there's two kinds of ransomware. One where they just encrypt your data and one where they steal it first and then they encrypt it your response to those kinds of attacks are two different responses because one says, if you don't pay me the money, I'm going to publish all your data. That's what happened to Sony. The other kind of ransomware as well. I just grind your business in the ground , you go bankrupt and go out of business. So those are two different problems. But as a chief risk officer you want to say, are we prepared for this kind of risk. Show me how we're prepared. Explained to me in layman's terms, business terms that I can understand how we're prepared to deal with this kind of risk.  Mitch R.: (09:48)Well I really like going back for a second and framing cybersecurity as a framework and using a framework in order to, you know, acquire and guide the use of all this information here. Particularly at IMA, our vice president of IT, he really emphasizes that cybersecurity isn't really one size fits all, right? There's not just one solution that's an upfront project then you're good. It's really an ongoing process. So my question to follow up on all of this is when implementing a framework and cybersecurity processes and procedures, how much time and effort really goes into first kind of the needs analysis and the risk analysis to see, you know, what are we comfortable with and then ultimately implementing something so cybersecurity and privacy protection is all in place for the organization on an ongoing basis, you know, taking into account this strategic foresight for the company.  Ray: (10:45)Excellent question. Okay. So cybercecurity LLC with the word cecurity, spelled with a C, a cybercecurity LLC. That's our company. We're a full service cyber security company and we specialize in a particular area. We specialize in the building and implementing of cybersecurity and privacy programs. Okay. So any company, whether you're a solo practitioner, whether you're a small company, whether you're a large company, you must implement a cyber security and privacy program. Now, depending on your size and the complexity of your company, complexity defined by number of, okay, size, number of employees, number of offices, complexity of the company, what regulations do you have to adhere to? What industry are you operating in? Have you developed your own internal software applications or not? Stuff like that. That increases complexity. but depending on your size and your complexity, that will dictate the size and complexity of the cybersecurity and privacy program, which you must implement. But you've, you get a program you have to put in place whether we do it for you or someone else that you're going to put into place, a program that's going to cover all these elements and it's going to be ongoing. It's not going to be a onetime thing. Okay, let's put out a policy here. Everyone read it? Okay, let's do some phishing training this afternoon. Okay, you're done. okay. That's the end of cybersecurity. No, no, no, no. Cybersecurity requires a change of thinking in the organization. For typical companies, we tell them it's going to take you six months to implement this because you're not going to stop everything else you're doing. You're going to implement it a little bit at a time, every day, every day, week after week, month after month until it is in place and until it becomes part of what you do when you're having a meeting about a new product you're rolling out. When you're having a meeting about a new territory that you're opening up. In your head, when you're onboarding a new person, every time you're doing anything, security is part of the conversation.  Mitch T.: (13:15)And if you are a regulated industry, you're in healthcare, you're in finance, you're in defense, you want in the regulated industries, you are either legally or contractually required to go off and make sure that your vendors, here in Colorado where Ray and I live, the law says that before you share data with a third party that is personally identifiable data, you must ensure that that company can protect that data. That is the law. Now other States have similar laws. So, you know, we talked about established companies, but let's move for a second to startups. And startups are always worried about, you know, getting their product out the door, whatever that is. And a lot of times nowadays, that's a tech product. And we've seen this, unfortunately, where we come in, you know, late in the game, they're ready to roll it out and they say, gee, we gotta go review the security. And they've done nothing about security and, and the security of the applications they've built is absolutely horrible. It's a disaster. And we've seen that recently in the news where, you know, companies have released apps and well look at the Iowa caucuses. I mean that was a brand new application. There was very limited cybersecurity. There's very limited oversight and it was an absolute disaster, you know, for a small company that could be the end of the company.  Mitch R.: (14:44)To kind of wrap things up, you know, we talked about a lot of different aspects going into cybersecurity as far as next steps for our listeners. What recommendations do you have as far as good resources or additional information? I know we mentioned the NIST framework, you know, your company. What else is out there and you know, what do you think our listeners should be doing now?  Mitch T.: (15:08)So we have a YouTube channel with some great videos on there. executives, nontechnical, videos, they're short, they run five to 10 minutes a piece, probably about a dozen videos there’salso some longer videos on specific topics. we have a blog that's available from our website. We have a lot of content there.  Ray: (15:30)Our website, cybercecurity.com, security with a C and that website by the way, it's not like your regular website just talks about a few things. There's a lot of information on that website, a ton of good content so you can get an education off of that. And then Mitch was getting ready to talk about his blog, which is very important source of information.  Mitch T.: (15:52)So to just to reiterate what Ray said, if you go to our website under training content, you'll see the videos. And then next to that there's blog and that's the blog I typically write, four or five times a week on different subjects that the conversations are typically nontechnical. They are privacy, security and compliance related. They're short, they typical reads probably five minutes. so I recommend that. And again, it's about just creating that general conversation that you have, if you have an industry trade association that you are part of, that trade association hopefully is bringing up this conversation. I know we've been pretty active in causing some trade groups to go do that, but if they're not, you know, the trade group can reach out to us and we'll be happy to go do a piece of specific to that trade group. We've done that for a number of different industries. Some of those are on our YouTube channel. So that, those are some things that you can do, but generally, you know, unfortunately, because cybersecurity and privacy risk is changing, morphing, amorphous blob right now you know, this is nothing that you will go off and say, okay, I read a book, now I'm an expert. It's one of those things where you're gonna learn and learn and learn and that's really the thing. That's the message here. This is an ongoing never ending forever learning exercise on that part of financial professionals.  Announcer: (17:31)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Dr. Doug Boyle: https://www.linkedin.com/in/dr-douglas-m-boyle-dba-cpa-cma-4004468/Dr. Boyle's Articles and Resources: https://sfmagazine.com/post-entry/june-2019-do-you-have-emotional-intelligence/ https://sfmagazine.com/post-entry/april-2019-leadership-skills-at-every-career-level/ https://www.imanet.org/-/media/977a1a6d07d3439588094827fdb768f0.ashx FULL EPISODE TRANSCRIPTAdam: (00:05)Welcome back to Count Me In. I'm your host, Adam Larson, and today you're going to hear how emotional intelligent plays such a key role in the success of management accountants. Mitch spoke with Doug Boyle, the accounting department chair at the University of Scranton about this topic. Doug also serves as the director of the doctorate in business administration program, the nonprofit league program and the high school business scholars program. He is an award-winning researcher and teacher and recently researched and wrote about the components of emotional intelligence as they relate to accounting and finance professionals. Let's hear him explain what it means to be an emotionally intelligent accountant.  Mitch: (00:47)So today we're looking to talk about the emotionally intelligent accountant. And I would first like to kick things off and ask you how important is it for finance professionals to have emotional intelligence?  Doug: (00:59)Yeah. Research has shown that a financial managers who have mastered emotional intelligence are the ones who typically reach the highest levels of the organization. For example, a chief financial officers along with, you know, superior technical skills. What really sets them apart from their peer group is that their ability to master emotional intelligence and connect with individuals. And there's several research studies that support that. So it's really important if one wants to advance especially to the higher ranks of an organization that they engage in and starting emotional intelligence in developing themselves and that area.  Mitch: (01:37)And I think this is a good opportunity to really establish a common understanding for the rest of our conversation here. I know you mentioned connecting with others, you know, but how do you actually define emotional intelligence?  Doug: (01:50)Yeah, emotional intelligence is a pretty complicated construct and we'll talk about the components later on from a high level. It's really someone's ability and capability to be aware of their own emotions and control those emotions and express their emotions in a way that facilitates strong interpersonal relationship with others. So for example, if I'm a CFO and I'm presenting to a group of analysts, it's very important for me to connect with them and really, express trust in confidence in a way that makes them believe, you know what I'm saying? Makes me credible, makes me convincing. So it's really all around controlling an individual's emotions, understanding emotions of others, and being able to manage those emotions too to build very strong lasting trustful relationships.  Mitch: (02:45)Well, you just kicked off that answer right there with my next question. I know a little bit about emotional intelligence, but I'm hoping you can kind of identify and define the components that go along with emotional intelligence.  Doug: (02:59)Yeah, there's four major areas and you don't have to master all the areas at once. Some of us are stronger in some areas naturally, and some of us have to work on other areas. The good thing about emotional intelligence is everybody could work on it and you get better. So there's four really big buckets with subcomponents. I'll walk through them, pretty briefly, but, you know, we could spend more time talking about individual ones later if you want. Now the first one is self-awareness. So that has two components, which is emotional awareness. So are we aware of our emotions and how we're reacting in a given situation? Next one is self-confidence under any self-awareness. So am I somebody who's confident in myself, somebody who makes people around me more comfortable because they believe I'm confident in what I'm doing and why I'm saying so that's the first component. The second component is self management. So then there's a little more, elements here. The first one is self control. So when I'm under pressure, am I able to maintain, control and control my emotions in a way that are effective instead of destructive? A second is trustworthiness. So am I somebody who delivers on what I say I'm going to do, can I be relied on and dependable? And that's a big part of emotional intelligence. Next one is  is conscientiousness. So am I somebody who follows up, am I somebody who is into the details enough to make sure things are getting done without being a micromanager? But I need to be conscientious. Next component is adaptability. So am I somebody who could adapt the situation or am I rigid and I try to solve all problems the same way every time? Cause maybe that was successful for me in the past, but it would probably be limiting in the future. And then the last one is innovation under self-management, which is am I somebody who's always questioning the status quo and trying to figure out new and better ways of doing things. So self management has the most components. The last two components are social awareness, which is empathy. This is really important, especially for accountants because as accountants, sometimes we tend to be very analytical. where in business it's very important to show empathy towards your employees, empathy towards your shareholders, empathy towards your lenders or bankers to really let them know that you care about them and their interests as well as the company's interest. So empathy is one that's very important for accountants. And sometimes it's an area where, you know, there could be some skill development. last one under social awareness is organizational awareness. And this one is when you tend to need, when you get higher up in the ranks. So, not only do I understand my own emotions and my little group around me, but do I understand the entire organization and the various cultures and protocols across different geographic boundaries? And how do I respond in those different areas. The last bucket is relationship management. And in a lot of these are very important when you get to the higher level. So for example, the first component is influence. So am I able to be convincing and get folks to move in a certain direction that you know, I need for them to move forward, you know, a company's success or organizational success and how do I do in a way where I bring them along where they're part of the decision making as opposed to me just, you know, mandating orders. Next is conflict management. Cause as we could just senior management is lots of conflicts between divisions, between employees, maybe conflicts with the vendors or even competitors. How do we manage that conflict in a way that's productive and that's, you know, destructive or, cannibalizing, the situation. Next one is, teamwork as again, as you get higher, your teams get bigger. So we gotta be able to manage all those elements of teamwork, leadership and communication. So as you can see there's, there's four major buckets, lots of sub pieces and when we try to train people, we don't have the more on everything at once cause it's kind of overwhelming. What we would do is do a self assessment and then work in areas that we think are most important first. But as you could see to master all these areas, it really does take a full career plan and a long time to develop. And you know, we could always improve.  Mitch: (07:03)So I know here at Ima we have the management accounting competency framework. We bucket everything in these domains. And very similarly we have all these competencies that fall underneath. And very similar to what you just said, you know, we have a self assessment where individuals can go through and identify where the skills gap really is. I'm just curious from your experience and those who you've worked with in emotional intelligence, is there a particular skillset that you recognize as a kind of the foundation? Something that if somebody has this, they have an opportunity or the ability to advance through all of these different components of emotional intelligence a little bit faster maybe than others? I don't know if, certain people you work with demonstrate certain abilities more often than others.  Doug: (07:49)Yeah, and I'm glad you mentioned that a day IMA a framework because when we did our research, we tied these into the framework and that framework is an outstanding way to try to approach these because interpersonal emotional intelligence skills were identified in several of the areas of the framework. To answer your question, when we did research in this area, we, surveyed practicing, financial professionals all the way from new professionals up to partners and CFOs. And we really did ask them which one of these are most important at different career levels. So, for example, when you're a junior accountant, these skills are more important or less important than when you advance. So what we found is across the board there are three or four (Im not sure if he says “or” or it is supposed to be just “four”)skill sets that were important no matter what level you're on. So we probably would recommend you focus there first. And those were self control. That in with self control means is that you're able to put your own emotions and individual interests aside and you're able to look at problems in a way that is objective in a way that's going to end up in a result. So that self control was deemed actually between the second to fifth highest ranked elements depending on what level you're at. Trustworthiness was the most important element across every level. So for financial professionals, you gotta really work on trustworthiness first, I would think. Cause that continues and as you get higher levels name becomes more important. So there's lots of practical things you could do to work on that. But, number one is really making sure you're listening to people and you're making commitments that you could deliver on and that you deliver on those commitments. Cause when we further investigate what makes a financial manager trustworthy is that we provide a lot of information to people and that they don't want that information to be at all overly optimistic or overly negative. They want information from financial professionals that they can have confidence and reflects  reality as best as possible and that they deliver on what they say. So that's probably the most important one. The other, the second most important one was communication and communication takes a lot of forms for accountants is there's verbal communication along with that comes body language. So what's their body language like when we're communicating to a client or to a banker or lender? There's written communication, which is very important, especially for younger people coming up because research shows that writing skills are on the decline for younger professionals because they're growing up in a  (he stuttered on saying world but I think you can take word out) world where they kind of write shorter than in prior generations and maybe they don't focus as much on their grammar and writing professionally. So communication was number two. And then leadership skills. So, are you able to energize a group? Are you able to communicate a clear message? Are you able to move a group towards results? So those four areas and all the components, I said they were ranked in the top among the top for all levels. In addition to that by level if you're a supervisor, cause we asked skills by each level. In addition to those four skills, teamwork came up as number three for a supervisor. So early in your career people want to really see that you're a team player and that you could work with a team and that makes sense because you're usually working with lots of different people and you just developing your skills. So I would add teamwork to a supervisor level. For manager included those four again as in the top, with the addition of conscientiousness. Cause I think people look at the managers as the ones who are making sure things are getting done. So in addition to those four, if you're a manager, you got to really make sure that you're reviewing work, your team is producing quality work cause you're really the gatekeeper between the, you know, the staff and supervisors in the executive level. So they really depend on you and make sure things are right and they're not going to be embarrassed by an error or something like that. And at the executive and partner, two skills actually popped up also as very high. One was organizational awareness, which makes sense. Cause if you're an executive or a partner, now you're working across the broader organization. So as you're advancing to those levels, you gotta make sure you spend a lot of time understanding the broader organization, what's the culture like, what are the protocols and how do we operate in that. And then lastly, influence became much more important as you became an executive level. So those kinds of negotiation skills and how you convince people to move in a certain direction. So in the article we wrote, we have all these skills laid out and importance by level, but, but that's an overall thumbnail sketch of where to focus. So your question was very insightful because you can't attack all this at once. So, you know, if you follow that roadmap and slowly start working up, you'll develop the skills by the time you reached a level that you aspire to reach.  Mitch: (12:49)It's really interesting listening to all of this. I think it could probably be pretty easily argued that the latter skills that you discussed, you know, teamwork, conscientiousness, organizational awareness, the influence, these are skills really that I believe are probably developed more through experience. Right? And getting the opportunity to develop these skills and use them on the job. However the skills that you said kind of translate no matter what the level is a self-controlled trust, communication, leadership, I think these are actual skills that people can focus on and develop on their own. So for our listeners, if you're interested in developing these foundational skills, regardless of what level you're at, how would you recommend going about learning the self-controlled trust, communication, leadership, and ultimately evolving their emotional intelligence for the later stages of their career?  Doug: (13:41)Yeah. Well we would recommend, well, first of all, the IMA leadership Academy, provides upstanding opportunities to do a lot of those because some of this, you're going to practice individually and then some of it is you're going to have to get out there and practice and work. So we would recommend that once you're comfortable to test some of these skills is actually go out, in those seven environments because they're safer usually than at work. Because at work it's your job and you're being evaluated. So if you're going to test yourself in a building, maybe a new skill, you might want to do it in more of a networking environment at an IMA Leadership Academy event or something like that. So we recommend you practicing a lot. But a few comments around how to approach those core skills is really self reflection. Cause we find it is most folks don't focus on these things and honestly assess themselves. So we would recommend you really sit down and you study three or four of these and you really give an honest assessment of how well you think you are doing at it. And to do that we recommend you reach out to a few people you really trust. And it could be family members cause they know you very well. Or it could be a friend you'd have, you've had for years or colleagues and really ask them to be very honest because you're doing this for developmental purpose and say, how trustworthy do you believe I am in the work setting or at home? Because typically the way you work, you behave at work is similar to home and you'll pick up cues from them if they're honest with you. And they might say, well gee, sometimes you do overstate what you could get accomplished and it really causes some trust issues cause when you state things people discount it to some degree. So we would say, A, self reflection, B, get feedback from people you really trust who are going to be courageous enough to give you a good feedback. You don't want to ask people who are just going to tell you you're wonderful at everything cause none of us are wonderful at everything. And then practice. I would practice and you could practice it and safe settings too, like I said and networking type of events where it's not as critical as if you're practicing, you know, with your boss. So, those are the three basic approaches we would recommend.  Mitch: (15:54)Well this has been very insightful and wonderful information to share. You know, I kind of look at this as, we're doing a lot of research into the future of work and kind of where the accounting and finance professional is, in the industry today. And you know, the technical skills, the technology and analytic skills obviously are huge, but emotional intelligence just continues to come up. So by offering this kind of background and foundation on the topic for our listeners, I think is fantastic. I'm just wondering, you know, I'm sure people can listen to this and say, I can do this or I can do that. Like you were saying, a little self reflection, but do you have any specific cases or examples maybe that will truly illustrate what the benefits of emotional intelligence really is for an accountant?  Doug: (16:42)Yeah, we do a lot of research in this area. And first of all, what you said about the more technical skills, that is somewhat concerning because when we look at the literature, mostly everything that's coming out is around, you know, getting tech skills, which is extremely important for your career. But our research shows, again, that the ones who reached its highest level have emotional intelligence. So, you know, we're a little concerned that accountants are getting bombarded with all this technology and they need to get that skill set up that they might ignore, you know, the softer skills, which are the ones, that are really important to retire level. So with that said, you know, we look at CFOs for example. So we look at chief financial officers or personal, public companies and compare them to their peers who haven't reached those levels. And what we find is there's not a lot of differences in the tech skills. So between them and their peers, the certifications they hold are usually very similar. They're advanced degrees they hold, they're very similar, you know, their technical background. So you know, we find lots of similarities there. When we look at our differences, they're usually in the areas of emotional intelligence. So for example, if I'm a mid level accountant, I may or probably very likely have this equal technical skills as the CFO, but what enabled him or her to be the CFO is they stand out in emotional intelligence skills. So, that case study really demonstrated that, you know, it's okay to be at any level in accounting. But if you aspire to be that top position, your technical skills aren't going to get you there. They expect you to have technical skills. They all do. It's the emotional intelligence that sets you apart in that, that study really demonstrated that. So we really recommend to our students here at the University of Scranton is we work a lot on emotional intelligence and we have an accounting communications course and other type of soft skills classes to help prepare them for that. Cause we, you know, we hope our students aspire to reach those levels. But, that case study really, makes it very obvious as to where you need to focus. You want to get to those types of levels.  Announcer: (18:51)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Jose Zavala: https://www.linkedin.com/in/jzavala03/FULL EPISODE TRANSCRIPTMitch: (00:00)Welcome back to Count Me In, IMA's a podcast about all things affecting the accounting and finance world. I'm Mitch Roshong and I will be your host for this episode. Today, you're going to hear Adam talk with Jose Zavala about how automation is the key to success of accounting and finance professionals. Jose explains the benefits, but he also addresses the challenges and pitfalls. He regularly helps firms save time and money through automation and has a great first and perspective on the topic. So to hear more, we'll head over to their conversation now.  Adam: (00:35)So Jose, as we begin 2020, it seems that automation is a key word in accounting and finance, whether it's through RPA or machine learning. How have you seen automation in general impact the accounting and finance industry?  Jose: (00:56)You know, that's a really good question. For me, what I have seen is it, at least personally on my level, it allows you to essentially provide a better service to our clients. You know, cause within this industry, at least my take on it is we need to be client facing. You know, they're our clients. We need to make sure they're getting, it's about customer service, you know, and if we're too busy in the weeds or heads down, you know, doing a lot of this taking care of kind of a lot of these administrative tasks or you know, doing a lot of stuff that we can maybe push off to a bot or to a software to do that takes away time from us to be able to be face first in front of our clients and helping them with those meetings as far as, you know, growth and things like that. So I think it's going to have a huge positive impact because it's going to essentially give us back our time to then to provide those better services to our clients and start being that advisor, you know, that investment for our clients to sort of be in what you don't have. A lot of clients see us as an expense. Oh, I got to talk to my accountant and I talked to my tax rep, I talked to my CPA. You know, where instead of doing that, they should be like, Hey, I want to make this move. Let me call them to get their take on it before and make it instead of, you know, making the move and then later trying to figure out, Oh, well did I do it right? Well, it's kind of too late. It's already done. So that's how I think go as far as automation is going to, help us in this industry. Because like I said, you know, give us back that time to be able to then give that time to our clients and provide them much better service.  Adam: (02:35)So as we look at that impact that you just mentioned of automation, you know, what about a more holistic view of its benefits? What are some ways that an organization can cut costs through those and through that automation?  Jose: (02:45)Yeah, no, I think that's another great question, man. So I was actually on the surge (Just want to make sure that is the appropriate way to spell the Podcast title)  podcast with JJ, the CPA, and what are the conversation or topics we hit on there was invoicing. I know, and my background is public accounting, worked at CPA firms my whole career before I went out on my own. And I remember one of the big things was always billing. So you would take two or three days to sit down, go through the bills and then having to do follow up calls and it was usually the managers, doing a lot of that work do that. So that was a lot of, to me admin time,  un-billable time that you could have. One of the things that just by, inputting something like a proposal software or automatic payment software that that builds your clients automatically, let's say on a monthly basis for a monthly recurring revenue, you can go ahead and eliminate that. The need to have to build that, to have to sit down and have those conversations and okay, this is what we need to do. We need to build this. We need to build that same thing as well. It removes, if you're printing invoices, stuffing them into envelopes, mailing them out, and then having to do followup calls and have an admin person doing followup calls. I'm trying to lock down those invoices. I feel like it takes a lot of time and there are too many people, too many hands touching it whenever it can be just one person making sure that these looking at the software, making sure the software is correct and then using that time, that person's time instead of non billable work, maybe move them into a little bit more billable work and, and you know, get a little more out of them that way. So that's how I think it can essentially cut cost is, is we can look at software and some of these, your friend's bots and things that are available to us as a way to, instead of paying a full time employee, we would pay them at and a third, a fourth, a fifth of the cost. And then make sure that the staff we do have, and not to say to replace a staff, but take the stuff we do, have them give them more higher value work and actual billable work that we can bill back to the client, which then in turn will keep them happier because you know, they're moving away from just entering checks into an accounting software or just entering deposits. You know, they're doing a lot more maybe client facing or maybe doing something else that you can play to their strengths. And then again, you know, you increase essentially their output, and by output is more essentially, you know, the billable output of them. So that's how I think it could cost that way.  Adam: (05:14)So what if you've mentioned all this to somebody and they're like, Jose, I am still not convinced. You know, you've given me these cost cutting measures, you know, the general impact. Okay, I can see the impact. But what are the real benefits to me as an organization? And how does that trickle down to my employees? You know, you mentioned one thing as a giving the employees more high value work, but what else? What else, what other benefits can they see?  Jose: (05:39)So I think one for you as a business owner, essentially it takes what it does. It eliminates a lot of those mundane administrative tasks that we have to do. Right now it's tax season we're having to, we're doing tax returns where, you know, if you're in public accounting you're in the grind right now. And one of the big things is, you know, having to go in and, and one having to make sure to okay do we have all our work papers in, you know, having to send emails and going through emails and trying to make sure you have all that information or same thing as well. You know, kind of going back to one of the things that I see a lot is trying to lock down lets say client meetings. So you're trying to do, have a client meeting and you spend three or four emails emailing back and forth. Are you free this day or you're free that day. And next thing you know, you know, when something could have been scheduled that week, it gets pushed two or three weeks ahead because you know, you're going back and forth and just little things like that kind of can help you save a little bit of time and bring a little bit of back of sanity back to you. And as far as your employees go, you know giving them the ability to essentially again go back to the higher level work, you know, so instead of actually going in and, and having to input deposit slips or doing just basic data entry, you can move that away from them and have them do a little bit more of the actual review work or actually, you know, making sure that everything looks right a little bit higher, advisor role and then be able to, especially give them, give them, like I said, a little bit more higher value work, which will then, well, from what I've seen at least personal experience on me, it makes him a little bit happier. Make some, like I'm actually part of the team. Getting more involved in the project gets them more involved with the client, more interaction with it them. And you start to see at least the, at least we've seen it personally in my firm. You know, I've gotten my, my staff a little more involved with some of our clients and I mean, the output has been essentially doubled what they used to and they're excited and they're, they're ready. And I mean, I don't have to be on top of them for every single little thing, you know, now it could be just me. I, you know, I could just been lucky with my staff, but you know, I wanted to make sure to implement those, those, those processes and give them the ability to do that with some of this technology that's out there. So a quick example would be tax returns. You have a client who comes in and gives you a box of receipts, a box of bank statements. Traditionally what we would do was go in and Excel and just type in, you know, okay, January, February and kind of create a quick P/L statement. Then we can create inside there. So with the use of different, of these kind of different applications that are out there, we use one called auto entry. You can actually take that import those bank statements in, you get an Excel spreadsheet. So then you import that into your accounting software. We use zero for our accounting software. And then they have this feature called cash coding, which you can mass reconcile transactions. So instead of having to individually reconcile a transaction, you can do all that. So we'll normally take you three, four hours of having to, you know, input in and typing in that information into Excel to create a P/L you can do it, you pay X amount of money depending on how many, on how many pages each bank statement has and you turn it around and you can create a P/L within 45 minutes. So it sends you back that time, which, and that allows you and your staff to work on more projects. And that essentially increases your profit margin. Cause your time, you're essentially taking less time on each project.  Adam: (09:15)You're taking less time, but you're also creating more longterm employees because they feel valued in that year. You're giving them more responsibility.  Jose: (09:23)Exactly. Exactly. I think you put it better than my long winded explanation there. That's what I was trying to get to. So that's what I'm trying to get to, you know they feel valued and that's the word. They feel valued and you empower them and the more they feel valued, the more they want to do  And as you start to introduce some of these new applications and say, Hey, this is how we do things, then they start to think, okay, how can I tweak this even more to maybe cut that 45 minutes, 30 minutes, and you know, and then they start to take that initiative and then it's off of your hands. And the next thing you know, you know, a project just keeps getting quicker and quicker and quicker, done quicker and quicker, but with the same level of the same consistent, work. It's just, you know, getting done in faster time because they're honing their processes in the end and if they buy into it, it's an amazing thing because then like I said, you just sit back and you're getting it and yeah, you can take up more clients without having to throw more bodies at it.  Adam: (10:23)So, you know, we've been talking about all the benefits and ways we can cut cost and of automation and RPA and AI and all these are very popular terms in the industry, but there's a kind of new, what are some pitfalls that organizations can be aware of and work to avoid when they're just starting out?  Jose: (10:40)Oh man, that's a great question. And I'm going to tell you from experience, it's just because there's an application out there or a software that that's industry. The industry standard doesn't necessarily mean it's going to work for you. Out of these sales guys out there will tell you, Oh yeah, everybody uses it. There's a cookie cutter way. This is what you need to be using this, this exact stack. And I'll tell you from experience, it doesn't necessarily work that way, you know, there are some software applications that are industry standards that I use that I enjoy, but there are some that just don't fit into my workflow and we use kind of other ones that are, you know, their competition, which aren't considered an industry standard and we use them just fine. You know, what I would say is be careful about.... do a little bit of research, but reach out to the community, reach out to two other accounts, reach out to other people that you see using the software most of the time, especially with at least the zero community that we're a part of a, you'll find some very collaborative accountants, bookkeepers, tax repairs, CPAs, you know what it is. You can reach out and say, Hey, you know, I want to use X software. I'm trying to find a workflow for how to capture receipts. Okay, there's different softwares you can use. This is what I use and do that. Because what I did was I went to just demo a bunch of stuff. We'll spend a bunch of money to implement something and then it wouldn't work or I didn't fit into my process. And then I tried another one and it didn't work. The one that, the worst for me was project management. It took me four different softwares before our found one that I actually really enjoyed. And I mean, it's, you know, I'm okay with it because we learned, but if I would have actually reached out and talked to people, they would have told me, Hey, at least one of them that I implemented don't use You know? And so, that what I would say, that those are the kind of the pitfalls and then as well to just, you know, watch your costs because I can't tell you how many times I try a software out and then I forget it and then it just sits there. But my credit card is getting charged $15 $20 a month, you know, for using it. I'm like, wait, I'm not even using this thing anymore and then as well, automation and all this stuff, it's used to enhance the client experience. It's not supposed to be used to replace. So a lot of people when they think about this, they think, Oh, well it's just going to help me. I'm not going to have to talk to my clients as much. I'm not going to, you know, have none at all. The whole point of this is to automate your processes or your client's processes to give you guys back some time to then talk to your client. You know, this isn't intended for you to distance yourself from the client, distance yourself from that. The way I see it in the way I think it should be used is to get you back that time to increase your relationship with your client, to increase the time you spent in front of them. You know, talking to them and helping them with those higher, with those bigger vision goals instead of just, Hey, here's a financial statement, have fun. You know, and that, that's the one thing I think don't look at it as like a, okay, cause if you're coming into automation and you think that, you know, Oh well I don't even have to talk to the client, they can do this. They can set everything up and we onboard them and we get everything out to them and we just have a quick phone call. I mean yeah, you can do it, but that defeats the purpose. I mean cause at the end of the day, we're all about client. It's all about the client and providing the best service to them. So that, that's what I would say is the pit. One of the pitfalls.  Adam: (14:18)Now, you mentioned it when we were talking about pitfalls, but I wanted to ask, you know, I know that this has been my experience when I'm looking at a software or trying to figure out how to do things within softwares or different applications. You know, finding a community of practitioners to discuss things with is always been an important place to bounce ideas off of. How important has that been for you as you've gone through your career?  Jose: (14:40)Oh my God, 100%. I wouldn't be where I am without a community of people I can talk to. like I said, you know, I spent a good amount of money, this learning on my own and it's just now ever since I reached out to the community and actually have people to talk to, it's so much easier because, I mean, if you're looking for, let's say, a solution for, for billing, let's go back to bill pay, right? There's eight of them out there right now. If I'm not mistaken, there's a lot of them. And so, which one's gonna work for you? Well then you go, that's where you can go to the community and started asking questions like, Hey, have you used thishave you used that ? What do you like? What don't you like? And for the most part, the community, at least the one I saw, I'm really active with the zero community cause I use zero primarily. But you know, so in our community where we're very open and any question you ask anybody, we'll just sit there and open up their playbook and be like, this is what I use and this is, you know, this is how I do it. And if it works for you, great. If not, then, you know, at least you know how it's used, you know, if it's gonna fit into your workflow or not. So to me that's super important. I wouldn't be anywhere where I'm at without the community itself.  Adam: (15:51)Definitely. So to kind of wrap up our conversation, you know, whether it's accounting, finance, general SAS, or other business functions, what future implications do you envision being impacted by the future of technology and automation?  Jose: (16:04)Well, I think, I mean, just our industry as a whole is just going to completely change, you know, I mean you've got more as more and more small business owners are starting to see, and even not even small business owners, but just, you know, business owners overall are starting to see the power of automation and you know, these different applications and things like that. They're starting to recognize that. And so as a practitioner, we need to keep up with that as well. You know, we need to keep up and make sure that we're providing the top tools for them for our clients as well. And I think that, it's going to come a point to where, you know, at least in the accounting industry, you know, where maybe before you competed on price, you know, I can do it cheaper. It's going to be more now competing on that customer service or that or that client experience. And, or maybe I might charge a little bit more, but their experience is going to be a lot better then if they're going with somebody cheaper. Especially if you can sell that value, you know, either sell it or showcase that value that you are providing with them with some of these different tools you're using. So I think it's going to make a huge difference and I think it's going to be a kind of a game changer. It's going to help us out as well to be able to, again, maybe take a step back from just putting our heads down and getting the work done to maybe helping them and moving more back into that, you know, moving us from an expense back into an investment in the eyes of our clients.  Adam: (17:32)It's interesting as people talk about automation and AI, there's a fear that the human interaction is going to lessen. But from what I hear you saying, it seems like the human interaction is going to be more important as those things become more prevalent.  Jose: (17:46)Yeah, 100% I mean, you know, they're not perfect. None of these systems are perfect. You still need it. You still need a set of human eyes to make sure what goes out is good. A robot. A system, an application cannot explain to a client why their cost of goods went up 30% over the last month. You know, you can sit there and run a report and create, you know, these fancy reports. But if a client doesn't know, they're not going to be able to understand that same thing as well. You know, if a client has a call and they want to, let's say a real estate investor and they want to buy a new piece of property and they want to sell their old one, well then you know, you want to make sure to walk them through a section 1031 exchange and let them know exactly what that is to help them with that or you know, different things like that. I think, to me it's enhancing. I mean, right now I'll be real with you. I spend more face time with my virtual clients that I do with my local clients and with Zoom meetings and you know, things like that. It's made it possible for me to work with them and I spend probably more time with them than I do like with some of my local clients.  Announcer: (19:05)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Chris Clulow: https://www.linkedin.com/in/chris-clulow-3832911/Cummins: https://www.cummins.com/FULL EPISODE TRANSCRIPTAdam: (00:05)Welcome back to Count Me In, IMA's podcast of all things affecting the accounting and finance world. I am your host, Adam Larson, and today's episode covers a few different topics. Chris Clulow, Corporate Controller of Cummins, talked with Mitch about leadership technology trends in the industry and the combination of the two for managing challenges associated with today's crisis and its working conditions. At the end of their conversation. Chris also shares a unique perspective on the future of the accountant. Let's head over and listen to the conversation now.  Mitch: (00:40)So I know in recent times we've seen a number of changes to the role of the accountant and the controller. So from your perspective and your roles and responsibilities, how has technology really impacted the job that you do on a daily basis?  Chris: (00:56)Yeah. It has changed dramatically over the course of my career, particularly as within Cummins. I've been here about almost 16 years we've invested a lot in technology and using tools, where in the past, we may have, may have used a lot more human effort, a lot more things like Excel, a little bit, more archaic, technology tools to help drive our decision making and now we have tools and processes that enable us to spend more time doing analytics and doing, doing the work, doing the thought and I think that's really, really key where you spent a lot more time in the past, pulling information together, compilation, and you didn't have as much time putting the data to work and that's, that's the real value you can add, both in an accounting and a greater finance area where you provide, some, just some analysis to the business to help them drive better decisions, to make them aware of trends that maybe imperceptible, to those outside of the accounting or finance arenas. So it is really become quite powerful things that we rely on. And it's gradual in some ways. I mean, we've seen the change, but sometimes you don't even notice how much, you know, how different it is now than it was say, a decade ago.  Mitch: (02:28)Right. And you've just touched on it slightly where you said it's really about presenting this information to those who may not be as familiar with the financials. So from a leadership perspective, somebody who is, you know, in the front of the finance function, what is your leadership style in bringing other functions up to speed and how do you go about communicating this information, these new insights to them?  Chris: (02:55)Yeah, I think the key is to really understand what they need, what they really need to know. So oftentimes, you know, when you're working with business partners, they'll ask a question or they'll ask for an analysis, a piece of information, without maybe an understanding of the effort that is involved or really what they're asking. So being able to kind of dig into that and ask the questions back to make sure you understand what they're looking for, is really critical, to kind of come back and say, Oh, you're asking this question, but I think you really mean something quite different. Something that could take you, you know, right off the, off the top of your head, you can answer versus doing 40 hours of analysis. So I think being that good business partner really is, pushing back at times, and making sure you can provide things. But going back to the first statement with, with technology and tools, what I've found is they've enabled our business partners, people outside of accounting and finance to understand finances and even the accounting side, better because it's just more consumable. It's easier to understand when you see things in more standard formats or things that are just, calculate for you. People are more adept at, being able to understand those, what was very complicated finance and accounting. There's still areas certainly within accounting that, people do not understand and it's breaking it down to what do they really know, need to know instead of going into the depths and plumbing, the depths of what came out from the FASB and why these things are important. Oftentimes a business partner doesn't need to know that level of depth. You can just kind of bring it up to more of a 50,000 foot level of what they need to know and why.  Mitch: (04:48)That's great. And I think obviously today, everybody dealing with the crisis that's going on in the remote work, you know, I'm sure the technology that you're implementing has certainly enabled business continuity and you're able to just kind of go about your day, business as usual. But there is a little bit of a setback I would guess when it comes to the interaction and the communication and the leadership cross-functionally because you might not be able to have these face to face conversations or these explanations. So I'm just curious if you've noticed anything along those lines at Cummins and what your experiences have been since kind of shifting to this new remote work style?  Chris: (05:34)Yeah, you definitely miss out on the informal, communications and the, and certainly the nonverbal, oftentimes you may do some video conferences here or there, but you're oftentimes talking on the phone and talking on Skype or zoom and you miss out on the bumping into somebody in the hallway or just seeing somebody at lunch where you have the conversations where, you can actually keep things moving forward at a greater pace and you can kind of make sure you're understanding the needs of the business. I am at the same time, very pleasantly surprised at the continued progress we can make in that is somewhat open to technology, but also to the creativity of the people, of being able to continue to do their jobs, working remotely and finding different ways to connect. Whether it's, you know, just having informal zoom sessions daily with their teams, using WhatsApp or text or anything under the sun from a technology perspective. I know even teams, within my group are having FaceTime happy hours just to keep that connectivity together and making people feel like part of a team. And I think that's really important. it is definitely more difficult. I think one of the, this sounds strange to say it in this way, but one of the advantages we have colleagues, within China who've been through this, just very recently and they've been incredibly helpful in how they steer it through it. Many of them are still in lockdown for those. We have some plants in locations in Wuhan that are just coming out of it now after over over eight weeks, but they found a way to communicate, to keep the business going, and to really keep it moving forward and I think that was, their coaching has, has helped us a lot.  Mitch: (07:37)You actually beat me to my next question because I know Cummins is global and particularly your role. Overseeing a lot of the global accounting. You touched on it a little bit, but have there been any global challenges since going to this, you know, remote work and, I assume much of what you did was done obviously remotely anyway, but was there any part of this, that maybe your global offices are feeling the effects and you're kind of coaching them through it also? Is there any reverse to this, global relationship?  Chris: (08:15)Yes, there is. And I think, I mean there's challenges depending where you are in the world. I think there can be access to internet that's, spotty. You know, we have people, I mean the whole country of India is now shut down until at least April 14th and that's a very large population and they're really shut down and all working from home and they don't have the infrastructure capability. So they're finding different ways to, you know, schedule shifts and use technology in stages versus, trying to do it all at once. So there's, certain challenges as we go around the world, so you're trying to have to have, different ways to reach out. Just last week I had a call with all the controllers, in our Africa region, which are, you know, smaller countries oftentimes, and connectivity and infrastructure is not as not as advanced and just talking them through and what they need to do and what they should pay attention to and kind of, you have to have some understanding that people won't be able to execute to the standard that they were in the past, no one's going to get it right to the penny. And I said, prioritize and just kind of work on what's most important and, and kind of give yourself, I think there's an element of forgiveness of to say we're, everybody's just doing the best they can and I think that's what we'll have to do. Making sure we cover all the big issues, but just you have to be, the caring aspect, for people is critical at this point in time. You have to understand the pressures people are under, and offer some forgiveness. Just even, we're going through our accounting close this week. So we've added, added an extra day of close  and we're going to evaluate midweek and see if we have to add another one. It creates pressure in different parts of the flow. But it's really important for people to know that you're hearing them and understand some of their challenges. So there's, the, conversations have kind of graduated to a new level has worked. We're talking to people around the world is that everyone's facing similar challenges in some ways and unique challenges in particular areas.  Mitch: (10:29)And as a finance leader, I'm asking a lot of questions about what you've done already and how you're going about your business, but have any questions been directed to you that there may not be a clear answer at this point? Are there any questions or concerns coming from your team that you don't have a definitive answer for right now? And if so, you know, how do you go about responding to that as a leader and working with the team to maybe come up with an answer?  Chris: (11:01)Yeah, that is an excellent question and that's it goes well beyond accounting, but I mean the number one question I get and it multiple times a day is when is this going to end? And that's a, it's a human question. It's less of a work question, but it's, one that's ever present in everyone's mind. And it's important to talk it through and talk through how people are feeling. Cause a lot of people, myself included, or even our CEO expressed it on a call where he was kinda caught in, Oh, okay, what do I do? What do I do? Do I work on the longterm? Do I just work on the short term? How do I balance out what I'm doing? And in my advice to everyone as they're going through that is just keep moving forward. People working, you know, don't just think about today. You have to keep thinking about tomorrow and what was important three or four months ago. It's still important. You, we certainly have to take care of the critical needs today, but we'll have to keep moving forward as well, so it's easy to get caught up a little in a bit of freeze when you're in crisis mode. So I think for me it's helpful to express that everybody's really kind of can feel that at different points in time and to keep moving forward. Shifting back to the accounting side, there's, probably some things here that are getting questions from auditors or multiple, things in my email, it's full every day with, other people offering advice on certain accounting questions where it's hard to answer, ideas on the impairment,, how does this change in the future? And how are we projecting out in forecasting and things like that. Those are difficult to answer. I mean it probably becomes increasingly difficult over the next few weeks. So there's accounting questions that are coming up now that we're trying to just do best efforts and come up with a good position on where we, where we think we are as a company and where we are, expect to be in six, nine months and beyond. So, I think that's a tough question right now  Mitch: (13:20)That sure is. And, you know, this may be a tough question to answer because of that, but, you know, the challenges that you're realizing and really the productivity that you're maintaining in addition to everything that we already previously addressed as far as the changing role of the accountant and the controller, you know, how do you think the role in finance and accounting may evolve even more in the future? Do you believe that this has any kind of sustainability to it, that the whole remote aspect or do you see technology changing the role, in the office even further than it already has? What is your longterm vision for the finance function?  Chris: (14:04)Yeah, I think that's it. That's a very good question. I do think, you know the current crisis is unleashed the creativity, which I mentioned of people trying to find new ways to do things. And, some of those will stay, will be found even early on. People that found solutions to things that we're doing remotely that actually make more sense than what we were doing in the first place and they're more efficient. And actually more accurate. So we're finding some good solutions there, but I do see, you know, finance and accounting plays a really key role in running a business. And when you get into a crisis mode, I think people begin to see that and appreciate it to a greater level to where they can see the hard work, see the value and the importance of maintaining, you know, a strong financial as being kind of the backbone of a company. Both from an accounting and finance perspective. So I think that it does create an appreciation for, people in the functions and I think that helps, kind of raise the profile, I'll say, of the finance and accounting and company and people will kind of lean on them even more, but also appreciate, kind of the hard work that they're faced with. So I think that the key learning, so a little change. I would say the internal dynamics of how the function interacts with other functions, but how we work I think will change as well. I mean, I think we were trending already towards an environment where more people are working remotely and you didn't have to be in the same office, to be interacting in managing a team. I've managed global teams for most of the last 10 years. And you have people that you may not see, but once or twice a year wise, and it works out fine if you just take a different level of, attention and have some different tools in your leadership toolbox, to do that. But I think it's worked out quite well. So I think that's, something, I think we'll will, this'll be an accelerator for that where you'll have people saying, well, this seems to work and you know I worked better at home at times. So I'd like to do that, you know, a couple times a week or do it differently. So I think that'll rise kind of throughout the world. I think people will see that once we're free to move about it. I think people will be running all over the place. But, I think in the long run, I think people will see some value of working remotely and that it's a completely viable solution on almost every part of our function.  Announcer: (16:53)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Danetha:  https://www.linkedin.com/in/danethadoe/  hello@moneyandmimosas.com  Money & Mimosas: https://www.moneyandmimosas.com/FULL EPISODE TRANSCRIPTMitch: (00:00)Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong. In this episode we will hear from the creator of Money and Mimosas Danetha Doe. Danetha is also a freelance writer for financial institutions, a consultant and a former accountant who now strives to help clients elevate their self-worth and their net worth. Keep listening to hear how this entrepreneur has excelled by taking leaps and maintaining a business savvy mindset.  Adam: (00:33)Danetha, I know you have a very interesting and wide-ranging background and I know some of that background includes accounting. Can you just give us an overview?  Danetha: (00:47)Absolutely. Well, thanks so much, Adam, for having me on. I do have a varied background and I think that that's becoming more and more common in all industries and also in the accounting space. My accounting background, it started in undergrad. I studied economics with a concentration in accounting. We didn't have a formal degree in accounting, so I just took all the classes I could within accounting and made it my informal concentration. After I graduated from undergrad, I went on to work for a home health care company and I worked in the accounts receivables department. Their accounts receivables, this was prior to companies moving to the cloud, so our accounting systems were all desktop legacy system and we had a lot of paper, a lot of invoices that were mailed out, invoices of checks that were mailed in for payments. And so my job was a lot of data entry and a lot of um, keeping track of all the paper. We had files upon files of papers. After that position that was in Indiana, I moved to California where I got another job working in the accounting department for a ski resort. And I started off being a billing coordinator. My background, well my previous job was in accounts receivable. So the role was similar in that I was managing the invoices for the catering and conference services department. And from being a billing coordinator, I moved up to being more of a staff accountants, helping them with cashflow and forecasting and other things that went along with making sure that their accounts receivables processes were in place. When I got into the role, we were about 180 days in aging accounts receivables and my job was to reduce that and I got that down to 30 days and that was my entire focus. After that role, I moved from the ski resort to the San Francisco Bay area where I am now. And my first position here was as a controller slash CFO for a small creative agency. And it was a really small company. So I wore both hats of being a controller and CFO. And a lot of my role was very much focused on accounts receivables. We had a lot of business, which was great, but our processes were not streamlined. And so we had cashflow challenges that were related to, you're not invoicing accurately on time. And so that was really my focus was to help that agency get that under wraps so that the cash was, we were in a healthier cast position. From there I was bit by the entrepreneurial bug. I was bit by the entrepreneurial bug then, but I knew from a young age that I always wants to run a business. So after that role, I just I had to start my own business doing bookkeeping for other small businesses. I focus in the beauty and fashion space and, and that's where my careers as an entrepreneur started.  Adam: (03:45)So, you know, being an entrepreneur, obviously you need to have a wide variety of expertise and knowledge to run your own business. So how did your background in accounting and the things that you were doing help you get into that entrepreneurial space?  Danetha: (04:00)It helped me tremendously. A lot of business owners do not have an accounting background. Certainly if you start a business as an accountant or a bookkeeper, you have that background. But the people that we serve don't necessarily have that background. And so my expertise in that space really helped me be able to build a business because I had a service that business owners needed. My skillsets outside of understanding different systems, doing the actual accounting work. Some of the skills that I picked up along the way of being an accountant were things like organization keeping on top of financial transactions. The paper, thankfully we're now evolved to using less paper and more cloud-base, but there's still some paper that goes back and forth. So being able to have a system in place to be able to keep track of all that information helped myself as a business owner and also helped my clients organization. As I mentioned, project management's huge. Also having an understanding of how cashflow works. I think as accountants we take that for granted. That's, for a lot of us it comes naturally to think about things in terms of net 30 net, net 60, how to balance the expenses with the cash going out. Something that I would do immediately with all my clients was to get them on a single day payout. Meaning one day out of the month was the only day that we sent payments out. So if they had recurring bills every month we would choose a date where those bills were paid. Usually it was the 18th or the 15th because of how their income would float in. It made sense from a cash perspective to do it usually the latter half of the month. So something like that as a really simple implementation. But for a lot of business owners, it's not something that even their mind, and here they are wondering why they're struggling with their cash, when it's a simple a process that can be implemented, in this case, just a single payout date to help them manage their cash flow and overall business operations. And so my background in accounting has helped me tremendously.  Adam: (06:20)That's just great to hear. Now, outside of the accounting, what was it like going from being in the corporate world, you know, doing all these different things to taking that leap of faith to be an entrepreneur? I can imagine that would probably be scary. Just, you know, going from a regular paycheck to your being the one running everything.  Danetha: (06:37)There was definitely, it was a mixed bag. I always wants to be an entrepreneur. I asked my parents for business cards for my eighth birthday. At the time I wanted to be a nail artist and so I've always wanted to be a business owner, so that leap from me was more of a homecoming, if you will. It was coming back to my, my true nature of being a creative and being a risk taker and carving out my own journey. With that said though, I do have my accounting side, which is very methodical and pragmatic and to your point about receiving a paycheck on a consistent basis to now I'm figuring out how that paycheck is going to come in and oftentimes it's not consistent, so that was, that's definitely a big part of the challenge with being an entrepreneur is realizing, Oh my gosh, the buck really does stop with me. What helps me with that transition was applying some of the things that I've learned in accounting. One of the things that I learned, that we all learn in this space, is you have to know your numbers. You have to know how much it costs you to live your life, so one of the first things I did was calculate my personal expenses, what do I need in order to feel comfortable, maybe not thriving, but at least comfortable financially, and that baseline helped me figure out, okay, I need to sign clients, recurring clients that will match this baseline. For some people it's 2000 a month. Some people it's 5,000 some people it's 10,000 whatever it is. Knowing that number and then setting up my business so that my recurring clients match that baseline, help me to then feel more comfortable as if I was receiving a paycheck on a regular basis. I created that for myself and then the income above and beyond that still, it's so flexible. It's still not necessarily guaranteed, but as long as I know that my baseline is covered, that really helps and that's a take a few years to figure out that process for myself. I'm not suggesting that that happened overnight, but, knowing information is really helpful.  Adam: (08:57)Definitely. That's great that you were able to take what you learned and that kind of was your almost you're level setting. You're like, I'm happy to be here. Yay. I've always wanted to do this. But then your accounting experience help you kind of focus in and say, okay, this is what I need to do to survive and to make this work.  Danetha: (09:13)Yes, absolutely. And sometimes for me I felt a little crazy at times because those are two opposites. They compliment each other. They certainly help balance each other out. But yeah, at times, you know, my creative side will want to take charge and then my more pragmatic accountant side would try to hold me back, you know, think things through. So yes, the both sides of did help balance me out and I think, I think a lot of accounts since, would probably attest to that as well.  Adam: (09:43)So what advice would you give to somebody who is looking to take that leap? You know, you just gave some overview of kind of what your experience was, but what if somebody is looking to kind of take that route. So, you know what, I've always wanted to be an entrepreneur but I'm not sure where to start.  Danetha: (09:58)Great question. And that is one of, it's a beautiful time in the entrepreneurial journey, the beginning, it's so pure and you have high hopes and dreams and it's a great time. But there's also some trepidation involved with when it comes to accountants. My advice for starting a business does differ depending upon who the audiences. So when I speak to creatives, writers, designers, they're typically, they're typically open to taking more risk. I find when I speak to accountants or bookkeepers, they are a little bit more hesitant because we're pragmatic. And so if I were to answer that question for a bookkeeper and accountant, I actually just received an email from someone who is a controller full time and has started building a bookkeeping business on the side. She has four clients and she's wondering, she emailed me asking when's the right time for me to go full time with this? And she was concerned because she wasn't sure. She'll be able to, you continue to pay her bills, all the normal things that we think about when it comes to going out on your own. And so when I answered her and when I speak to other accountants, my suggestion is, so really ask yourself, what would you think if would you regret anything 10 years from now if you don't take that leap of faith? Because there's never a right time to start a business. I'm not a mom, but I imagine it's almost, it's like having children. There's never the perfect time to have kids. You try your best to be as prepared as possible. But you know, kids don't come with a blueprint. Businesses don't either. And so I'm really thinking about what does success mean for me? What makes me happy? And going along with that feeling and knowing that trusting yourself that things are going to work out. Then you know, the first practical step is to start looking for clients. And that from me was about finding an industry that I was passionate about. I love beauty and fashion. So that's where I started when I looked for clients and really building a business around my passions. That's, that would be my recommendation for anyone that's thinking about starting their own business.  Adam: (12:17)So how has your mindset changed, uh, over the years? You know, you've, your path has kind of gone all the places you've kind of covered as we've been talking today, but how has your mindset changed over the years? We've, you know, the changing of technology that's all around us, but also the industries and just how the world is changing. How has your mindset changed toward your business and how you look at things?  Danetha: (12:38)Oh, my mindset has evolved in incredibly over this time period. I would say it's interesting. One of the first books I read about money was thinking, grow rich. This was in high school. I read it when I was 16 and I remember thinking, wow, that's amazing. Like I can create a rich life based upon my thoughts if I can get my mindset correct. And that stuck with me at that age. But as I've gotten older, it's been several years since I graduated from high school. As I've gotten older, the lessons from that book has deepened and enriched in different ways. And one of the things that I've found from me where I've always been a flexible person, I've always been someone that that's more or less gone with the flow and I'm an open to that. But as an entrepreneur, I've truly had to learn how to be flexible. And you mentioned technology that within my accounting career, which for some people that are listening may seem short because I am still a younger person, a younger professional. For others it may be, you know, I've been in this for a while, but regardless, um, it's changed a lot within just my career span. I, I learned accounting on peach tree software and now it's completely different. It's completely cloud based and you can completely do it on your mobile phone. And so the flexibility has come in that regard, come with understanding that my clients are expecting that I am ahead of the curve technology wise, that I am introducing them to new products, new ways of running their business. And it's up to me to not just be a good accountant. And then on top of that, be a good business owner, which means I've got to learn sales, like I learned marketing or my own operations. But then I also have to be technology technologically savvy. So I've got to do my own research and stay on top of the trends. And so that, that's been the biggest shift from me is continuing to be open to evolving.  Adam: (14:48)That's huge because if you get stuck with the same mindset and you don't allow yourself to evolve, then how can you grow as a business? Because your business as an entrepreneur is a reflection of you, right? And so if you're not evolving, then how can your business evolve?  Danetha: (15:03)Oh my gosh, I am so glad you put it that way, Adam. I really believe that being a business owner is more about a personal development journey then then being a business owner, they really just go hand in hand and you're right. For me, in my experience, the more I've evolved as a person and been open to my own seasons, shifting in my life and allowing my perspective to shift, not holding fast to any truth and being open to the truth, evolving with time, I've seen that, I've seen abundance reflect back to me because of that. So yes, you're absolutely right. It is about a personal development. It's about evolving personally as a person and let it, allowing that to reflect back to you in your business.  Announcer: (15:57)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Talal Abu-Ghazaleh Organization(TAGORG) https://www.linkedin.com/company/talal-abu-ghazaleh-organization/Talal Abu-Ghazaleh: https://www.linkedin.com/in/talal-abu-ghazaleh-95b298/Joa'an Abu Ghazaleh: https://www.linkedin.com/in/joa-an-abu-ghazaleh-701a9788/FULL EPISODE TRANSCRIPTAdam: (00:05)Welcome back for another bonus episode of Count Me In. For today's conversation, we're going to hear my co-host Rouba Zeidan conduct a very special interview with the godfather of Arab accounting. Let's listen in now.  Rouba: (00:22)So hello, this is Rouba Zeidan. Tonight I have a very, very special guest, Dr. Abu Ghazaleh, who's an accountant by profession and one of the greatest and most influential minds in the Arab world. He's a graduate of the American University of Beirut, which is a pride for a Lebanese, or for someone with Lebanese origin like myself, but you also had honorary degrees and PHDs from various other universities throughout your career. You've also been honored by numerous diplomatic figures and presidents throughout your life. You also have a very longstanding series of friendships with the likes of Kofi Annan and anymore. You're major advocate of intellectual property, education, knowledge, economy and information technology. And you're known for your forward-thinking business projects and ideas and the Arab world and globally. So, one of your universities in Jordan, actually has no testing. In order to graduate, you just need to innovate as a student, which we found quite interesting. How do you feel the educational system in the region is working to promote and encourage innovation in young minds?  Dr. Talal: (01:31)You may be surprised, or you may know more than I that this is not a unique problem in this region. It is international. I was invited by Harvard university, Columbia, and MIT, to make public speeches and I told them, that it is unfortunate that these great institutions who are supposed to be the best in the world, have made themselves redundant. Because what they do is still what was happening in the “Kuttab” (an old-fashioned method of education which used to be prevalent in the Arab world). They used to in “Kuttab” sit on the ground. Teacher, books, lectures, exams. The exams are for testing how good is your memory. How much do you remember of what we taught you? This is the same now in Harvard or any great university, not just in this part of the world. And we produce job seekers by giving them certificates that they are good at remembering what they were taught. It's a test of “Hifth” (memorization in Arabic) how good you are at remembering what we have taught you. Incidentally, I don't remember anything I learned at school or at university, and a great school and a great university I went to. I don’t remember anything. Because they used to teach us what is the highest mountain in the world? What is the longest river? what is the oldest city? Information now that it is a pity to use and dwell on, on our memory space, instead of using our memory space for useful thinking and production. Now I don't remember anything and unfortunately our part of the world, because it follows the American and the Western culture in teaching, is in the same way. I believe it's time. And I told everybody that it's time for universities to realize that, in the fourth of revolution, the industrial revolution, what is needed is innovators and not graduates who are job seekers. Why? Because an innovator, sets up the business and employs others. Our current job seekers, they go around looking for jobs, like I did. I applied when I graduated to something like 700 schools and companies to work. I got 500 refused. Not interested. I don’t have experience. We will look you up once we review, etc. and 200 even ignored my letter.  I keep these letters for memory to teach myself, I keep reminding myself. I keep them in a luggage bag. And I carry them wherever I travel. If I change locations, like I did to Canada or to Cairo or to Amman. When I move from place to place, I move this bag. Why? Because it is a good reminder that a university degree is useless. Even at the time when I graduated in 1960, there were people who were making money and had no degrees, and making successes, who had no degrees. And as I said in my speech today, that a job prevents you from being poor, but it also prevents you from becoming rich. That is a fact. Now, our educational system is very wrong. Basically, because, sorry, look at, doctors. A doctor will not give you a medicine without examining you. In schools, we treat all brains with the same medicine and there are no two brains which are equal. This is what the scientists tell us, every brain is different. And how do you feed my body, as my body needs, but when it comes to my brain, which I think is more important than my body, you feed the intelligent, the idiot, the slow thinker, the very fast thinker, the man with the critical mind, the man who is lazy, we feed them the same education. The president of Harvard, former president of Harvard said, “The Tsunami of modern education, this Tsunami is going to wipe all schools and universities who do not adapt to the needs of change in the knowledge age. Now, that is why the leadership of change in education shifted from the US, Canada, Britain, Australia, whatever, France, to the Scandinavian countries. Finland today is the leader in innovating education and they are now realizing it now and implementing in many, schools. First, the decision now is that there is no government education organization. It's not the business of government to teach and they are moving all government education to private sector. Number 2, the private sector should not teach you. Their job is to make sure that you know how to learn. Not to be taught. To learn, you learn what is suitable to you, what is adaptable and convenient for your brain. So we have to realize that in the knowledge age where the only source of income and wealth is through knowledge creation and that's why at the Talal Abu Ghazaleh College for Innovation, which I think is the first in the world, not only in the region, there isn't any college in the world which says, I don't examine you to graduate. You have to submit an acceptable innovation, not just any kind. And we know because we are the largest and the leading intellectual property company in the world. We know what makes an innovation. So, you have to invent something. And invent doesn't mean that you have to do something new. Any change to your mobile, in size, in design, in numbers, in program, is a new invention. That is what the World Intellectual Property Organization (WIPO) says, one which board I served, as an expert. So therefore, what we need now is to invent in order, to make this movement of progress in the right direction. There is no place in the future for anything except innovators. And when I say innovators, I mean every individual. The telephone operator can innovate. A painter innovates. Innovation is any addition or change or improvement that has value and is ‘commercializable’. It can be commercialized. And that is what we do. So, what we do in our company, and this gives us an added value is in this school, we test your invention and say, great, this is an innovation. Then we can register it and protect it for you as an intellectual right for the student, for their own right. It’s their ownership. Then comes a third stage, the commercialization of inventions. We help to put them, we help them to put them in contact with the right partner. Either to buy their inventions or to partner with them or to license or to do anything that helps in making the product a commercial product in the market.  Rouba: (10:50) So, they take off in the world with a career “ready, set, go, plug and play”.  Dr. Talal: (10:55) And most of the problems today, if you focus on this part of the world, which is not that serious in the US, we don't have a silicon valley where there are venture capital companies, we don't have any venture capital companies in the Arab world. And this is another criticism. Unfortunately, in the Arab world, we only think that what is safe and good investment is what I can touch. A building, a chair. Rouba (11:30)Tangible Dr. Talal (11:31)Tangible. Whereas in reality, one invention, which is a software, just a program is worth, is more valuable than the GDP of 20 countries. Google. What is Google? computer program? No raw materials, no labor, no products, nothing. It's a knowledge product and it's only a program. Uber. What is Uber. A program. Amazon, et cetera. These inventions are the ones we are guiding our students Talal Abu Ghazaleh College of Innovation. What is your interest? Are you interested in cyber security, cyber security, or do you like robotics or do you want to develop machine learning? What do you want to do? And when he discovers himself, we guide him to the sources and access to the information, because we are connected to all the databases in the world, through our partnership and online libraries all over the world. So the important thing is, unfortunately, and I'm saying this, I know I offend a lot of people… Rouba (12:52)The truth hurts Dr. Talal (12:55)But they accept it from me, somehow because they know what I stand at, where my heart is. I'm not criticizing because I’m a revolutionary, I'm a criticizing because I want the right change. I was just asked by one of the interviewers : so, what, what can we do to do this, making this change? She said, I heard a lot of talk in all the region about artificial intelligence. I said look, there is a lot of talk, but, I haven't seen any action on artificial intelligence and education. I don't see any school who is using artificial intelligence.  Rouba: (13:36)Yeah, because you, you say that and for example, the World Economic Forum, when they looked at the future of jobs, they said that 65% of students who are going into their graduate degrees now will graduate into jobs that do not exist. So, what are we doing to mitigate this? Is there anything that's being done? What are those jobs?  Dr. Talal: (13:58)Well, the jobs of the future are now clear. Let’s take the simplest example, just robotics: the design of the rope, the software that you would put in the rope, the maintenance, because this needs to be maintained, how much intelligence you want to put in the robot. And the then this robot that you want, you should decide for what purpose and services you want it. If you just study robotics, that's a whole world of services and of expertise. Self-driven cars, which is the future, Rouba: (14:44) The autonomous car. Dr. Talal: (14:50)In 10 years, nobody will own a car. In 10 years, there's no car, private car. Why should I have one? Why should I use a driver? That's one of the jobs with this will disappear, because these cars would be parked and various parking places and online you choose what kind of car you want. You talk to the robot because the autonomous car is a robot. You talk to this robot, you tell him what you want, he says fine, I know, I'm coming now. I'll say I want you to take the children to school and come back to me. He takes them to school, he comes back to me, then goes back and parks. This would solve the traffic problem and the question of investing in cars, repairs of cars, problems of parking cars.  Rouba: (14:42)Environmental pollution also. Dr. Talal: (15:45)Absolutely! So, a lot of things would change. Unfortunately, we think of artificial intelligence as an art that we need to learn and know about, that's all. That should be at the elementary age. Children should learn about artificial intelligence. That’s we are now telling our graduates. Children should be told that to find out and learn about artificial intelligence, and we exchange information with them on the subject and lead them on how to learn. In the upper classes before university… Rouba: (16:38)Secondary? Dr. Talal: (16:43)Yes, in secondary education they have to trained on the applications of artificial intelligence, not the concept. I want children to know about the concept because you will find that some of these children, once they know about the concept, they can become inventors immediately. The greatest inventors in the world are children.  Rouba (17:08)They're still not conditioned. Their minds are, I guess, much more raw. Dr. Talal: (17:12)The luxury of having been born as digital citizens, the child, in the mother’s lap he grabs the gadget from his mother and starts writing.  Rouba: (17:25)As you said it, he's learning with his fingers. Dr. Talal: (17:28)When I was speaking two days ago in Muscat, somebody came to me and wanted to remind me that our Quran said “iqra’” (in Arabic: read). He said: “do you want to cancel reading? Do you want to cancel books?”. I said the Quran says that reading has to be from written and typed book, by somebody who doesn’t know what he is writing about most of the time? When a child uses this smart tool, with his finger, he is reading, he is writing. When he does a search, he is studying. When he sends a message, he is communicating. When he plays with the games, he is playing a whole game online. In our school, for example, Talal Abu Ghazaleh University College for Innovation, we teach now our students, we don't teach them, we guide them how to write games. Why should games all be written by a certain culture and for certain cultures. I want games written by Arabs for Arabs, for that historic stories like Alibaba, and I don’t mean the Alibaba of China. I want them to write stories about Ibn al-Muqaffa' and start writing stories about our great scientist Al-Khwarizmi, our great innovators... I spend a lot of time criticizing the media, because in the Arab world, our media is only talking about what is bad. It's true, we have a lot of problems and we are in a very serious situation in the region. But, I shouldn’t forget my history. Historically. We are a great nation.  Rouba: (19:44)Correct Dr. Talal: (19:45) We are at the basis of old signs. The internet you are using couldn't have existed without the Arabs.  The story is when we’re talking about this media, that the Arabs came up with the idea that we need a zero. The Europeans said that Arabs were stupid. How is it, how can zero be a number? The whole concept of the internet is based on the zero.  Rouba: (20:22)The foundation Dr. Talal: (22:23)And that's an Arab invention. I can go until after tomorrow telling you about the Arab World and I want to create this feeling of pride in the Arab world, because without pride, without ambition, without confidence, you cannot innovate. If you keep saying this is not useful, hopeless, there is no use… How can this area be no use, no real value, when every country in the world is fighting to have its footsteps in this region. If we are a useless future, why should people fight and lose people? They lose people, they lose money, they struggle to have control in the region. Why do you want to control something that has no value?  Rouba: (21:17)When you were talking about the transition of education and how it's transforming, by default, not because any institution is driving it per se, it's just the digital transformation that’s kind of leading the way. Like, in a discussion with an MIT economics professor who saying that even MIT, as established as it is, they're having trouble enrolling students for full time academia, because they are going for online education, more so. But in your view, what is the future of education? How are people going to learn in the future?  Dr. Talal: (21:47)I know I'm offending everybody. But I would like to ask every government in this country, to think how they can transform their universities and their campuses to use for purposes, because there will be no need for any university building or for a campus. Sweden, as of next year, will provide online free education for everybody in the world.  Rouba: (22:18)Wow! In the world! Dr. Talal: (22:20)In the World! Free! And you will get a degree online from a very respectable university, which has tradition and culture, and which is  and which is state of the art in education, because that's what Scandinavia is. And the Americans, I know, I learned it from Finnish experience, which is the best experience in the world in education.  Rouba: (22:48)So it's giving you a sensibility.  Dr. Talal: (22:50)Why should I spend billions on buildings and campuses and books  Rouba: (22:59)And student debts afterwards. Dr. Talal: (23:01)No, that's number one. Number two, even worse, you know that Google is working on a university brain. This is a project which is already in process. I think it would be in less than five years. They will the brain of a graduate students, which through artificial intelligence they will put in my head and I will become as educated as any university graduate. So I will save 11 years of my life. And this is not fiction, this is the reality.  Rouba: (23:45)It's like uploading software basically.  Dr. Talal: (23:46)Exactly! You upload a software in your mind and at the age of 14, you are a graduate. And you can be a graduate of any university that uses this brain. You want an American education? Okay, I'll send you an American brain. You want French? I can send you a French brain. Our educators and our ministers of education are not aware of this, because they don't want it, because in the future there is no need for a Minister of education. Ministers of education will not exist. There's no use for them. Why? Why do I need a Minister of education? What is he going to do? Because I'm going to get any qualification or education or skill or profession online. We're doing that now. I chair the International Arab Society of Certified Accountants, and now our qualification is online. You don't have to take any course. You don't have to prove that you have any experience or qualification or degree, and this is not innovation. This is old history. In Britain, you can become a chartered accountant without going to school. You're not required to have a degree and we don't ask you about any qualification. You just sit for the exam.  Rouba: (22:21)Straight to the point.  Dr. Talal: (22:23)This is the future.  Rouba: (25:24)Let's say, in this kind of world, you are already a professional, whichever industry because with AI as I know, you're very passionate about, AI is transforming every single job or profession in the world. How does one upscale, I mean, until the likes of Google have had that chip where you can upgrade, what do you do now to upscale and then so that your skills are not obsolete.  Dr. Talal: (25:46)Again, I'll give you an example. We are a leading accounting firm. For a year we’ve been working on a tech auditor. Our auditors will never need to go to the client to check their books. We would think that you have to go and take a file and your computer and go through the receipts, check the file... We have learnt how easy it is to do all of this online because we have a hundred over a hundred offices. We don't ask them to send us a report because we know what they're doing, because online we are watching his accounting records, his cashflow, his bank account, everything. So, if I can do that, what can’t I do it with an audit? Our project of the tech auditor, the auditor wouldn't be the program, not the individual. We would input them into this program: Accounting standards or Auditing standards, and in five minutes you would get the report which would take months and staff to go and check books and records. It's the change. The speed of change is beyond explanation, but unfortunately the decision makers don't like it, because, first, there is a problem of culture, not easy to change, Second, there is the need for the existence universities and schools. There is the need for a ministry to tell you what program you can teach. When I started, I wanted to teach artificial intelligence. They said it's not on the list of courses because they have a list of subjects. I said I am not going to teach geography. I don't want to teach literature. I don't want to teach psychology. I want to teach artificial intelligence, only.  Rouba: (28:18)Figure it out! (laughter) Dr. Talal (28:19)We managed to get it, but it is still a problem for all universities and all school is because they have to comply with the ruling of the Ministry about their program their courses. The space of the class: how many students per professor? All the nonsense in the world! To get a license to have the university, in some countries, one requirements to have 120 acres of land. As if I'm going to build Disneyland  Rouba: (29:02)Or a farm (laughter) Dr. Talal: (29:03) Or real estate. Change is unfortunately a problem in this part of the world. In my case, the problem is that I’m too much. when I actually added a new policy or rule or request, my colleague said, but Mr. Chairman, only two weeks ago you told us that we should do the following. Rouba: (29:35)Times change. Dr. Talal: (29:38)I said, no, I'm sorry! This has not changed in two weeks? I’m sorry for being so late in making this change. In two weeks, the whole world has changed. Rouba: (29:50)Exactly, it changed by the hour, I think. They call you the godfather of the Arab world. How did you earn that title?  Dr. Talal: (29:56)They call me many things, people who love me or like me or appreciate what I'm doing, they’re very generous, they’re very kind to me. Maybe because I'm an old man, that's all. It’s because of me age. Rouba: (30:14)You carry it with pride. You said, and I quote, you said: “accounting is a base for better decision making”. How do you find that that fairs amidst that fourth industrial revolution, that you speak of, with digital transformation and the massive takeover of AI? Would there even be a role for finance and accounting professionals to play, when machines can do that job way better and more accurately and efficiently and consistently?  Dr. Talal: (30:39)Exactly. This goes back to the year 1992. I was elected to the board of the International Federation of Accountants, the first Arab ever to be on the board of IFAC, the International Federation of Accountants and the ISC, which was called around that time, the International Accounting Standards in London, both. And I was the only non-Western and I looked funny. With all the big brains, big names, Arthur Andersen… (inaudible) etc.. So, before we go into the discussions, it was my first day, I said what is the objective of accounting?, Why do we do accounting? They looked at me like this idiot who doesn't know what accounting is for. They said: accounting is to produce financial statements. We keep accounts so that, at the end of the year, we know what is our financial position and our profit or loss, because that is very important. We want to know our financial position and results of the operation, this is very important, it’s what accounting is for. I said, no, I’d like to move that we change the object, the mission of accounting, the mission statement, to become : accounting is it a tool for economic decision making. Once I have these financial statements, they are material for the decision in the future. How can I make my financial results better and my financial position better. So we need them in order to take economic decisions that improve our operation. The chairman of the meeting said, any second call for discussing this subject. The answer was no. Forget it, drop it. I came back the next meeting with one person who was willing to second my stupid recommendation. And at the meeting I said that I wanted to go back to the subject of objective of accounting. He said, but we discussed it but it was drop because there was no second. I said, let me try now. maybe there is a second. He asked if any wanted to second the answer was yes and he said: I think it's worth studying. Let's look at this. Okay, cool. Studied, discussed, nobody agreed. No majority, there is no change. Two years and finally I come to change. I drafted the document, which is at the beginning of the accounting standards, which says accounting is a tool for management, economic decision making.  Rouba: (33:57)And then you wonder how you earned that title of godfather. (laughter) Dr. Talal: (34:01)That's me. As I would always say : you don't lose until you stop trying. As long as you are trying, you have not lost. The vote was against me, but I haven’t lost because I’m still trying. Now what I'm saying is unfortunately, now, this has to change also. We need in the knowledge, in the age of industrial revolution a new standard for knowledge creation. In the year 2005 I was serve on the board of WTO, World Trade Organization, Board of Experts, and I asked that negotiate policies and agreements for trade in knowledge products. But then they looked at me like an idiot. What do you mean knowledge product?. Unfortunately it was because WTO was born before the internet. It's a pre-event and therefore there was nothing in WTO internet-related.  Rouba: (35:24)Oh, till now? Dr. Talal: (35:26)Till now. I fought that better, they said you’re absolutely right and we support you, but unfortunately, we don't know what to do about this because this needs negotiation because WTO is an organization where everything is done in a negotiating room by consensus. If one says no, it’s killed, and the US said no. To make a long story short, last week, president Trump decided that he wants to start discussions with the World Trade Organization on knowledge products inclusion.  According to what he said, to reform the WTO to be to incorporate the knowledge products. For an example, how would you account for Google? In the WTO, trade is either a service or a product.: goods and services. Google is not a good nor a service. Now what does a good offer? It's in business and it's a very good business. In 10 years, they became 1 trillion in value, so it must be that a very profitable business. You, that all of these, world companies in the knowledge age, don’t pay taxes because you cannot account for what they have.  Rouba: (37:09)Yeah. It's like when they said that the, for example, Airbnb is the biggest hospitality group, but they don't own a single hotel. Same with Uber. They don't own a single fleet, but their an actual taxi company. Dr. Talal: (37:19)For example, Amazon paid only 20 million in the UK. Why? Because they calculated that, on the revenue Amazon made through advertising. Because companies would advertise on Amazon and the revenue earned by Amazon from advertising was taxed. But 20 million is nothing. Rouba: (37:52)It’s a drop. Dr. Talal: (37:54)I haven't seen any balance sheet or profit and loss of all of these major huge giants in the knowledge age.  Rouba: (38:03)But I guess that's about to change now, not that it's on the agenda.  Dr. Talal: (38:06)So now, exactly what I was saying in 2005, Trump called and asked for these negotiations. Now they would form a multi-lateral negotiating forum for everybody to come and discuss what I asked for in 2005. Rouba: (38:27)That’s remarkable!  I know that you have a very busy schedule, I just have a few more questions for you. The other day at the lecture, which I really enjoyed by the way, you're an amazing speaker and the room was majority women and you seem to be very proud of that factor. You compared them to your granddaughters, and you encouraged them to continue to learn and grow. Do you find that women, in the Arab world, are given a fair chance to represent their gender within the leadership spectrum?  Dr. Talal: (39:02)I love women, but I'm very critical of them. Who mandated men to give them or empower them or give them an agenda? Why do you want to submit to men to give you this? Why don't you give the men the agenda? This is my problem. And then all my coauthors are of women and they say, we want to be enabled. I say, who enables you? They said, the men. I said, why don't you enable them? You decide that you're the boss and you want write their agenda and they will get it. This is the problem with women. They have this mental block that this world is ruled by men and we have to ask them permission to let us co-rule with them.  Rouba: (39:49)Yeah, I mean the term male domination does come to mind. Do you think companies are actually hiring  women in leadership positions? If you look at the Arab world, the majority of CEOs and the top echelon C-suite are mostly men. Let's say all of these women are empowered. They have the education, qualifications… Dr. Talal: (40:09)Because of the culture of women, not men. Women. Like this lady, she managed to be a senior, Joanna Abu Ghazale, not because of the name Abu Ghazale, but because she decided to be superior to men, in her job. It’s your decision. I can't understand why women want to beg men to recognize them, you don’t need them.  Rouba: (40:40)So, if you were to give them one singular advice, as professional women stepping…  Dr. Talal: (40:45)Take your leadership in your own hands. Don't wait for men to give you a role, take the role. Why aren't you trying like I tried to establish companies, what is wrong with you? What is wrong with women that cannot form companies and be their own chairmen? It's there, but it's very few because they wait for men to make them, to connect them to become in higher positions. Put yourself in a high position and employ a man.  Rouba: (41:22)Love it. Thank you.My last question is : with all these years of seasoned experience and beautiful contribution to your sector and others, even music that I've noticed, which is wonderful..... Dr. Talal: (41:37)It's my love.  Rouba: (41:38)I noticed it's a passion. I've seen that you've followed through on so many different productions as well for orchestras. It's amazing. I want to know in your opinion, what is the essence of leadership? What makes a leader?  Dr. Talal: (41:54)You were in the morning at this speech.  Rouba: (41:57)Yes.  Dr. Talal: (41:58)I tried in this speech to say that, but without using the word “to be a leader”. I said life taught, the leaders of the world taught. My implication is these 13 points that I raised make a leader. You decide. You have to believe, that everything in you and for you is your decision. No one is born to be second rate. No one is born to be unhappy. Your destiny is your own decision. That's a leader. I don't wait for somebody else to tell me how to succeed. I decide to succeed. Secondly, to be happy. Happiness is important in leadership. Nobody would like and try to follow somebody who is frustrated or discouraged. Rouba: (43:01)Or toxic.  Dr. Talal: (43:05)That's very important. Also, the feeling that to lead means how to motivate. Our leaders think, some of our leaders at least, think that leadership means giving orders. I never give orders. If I'm asked, I give advice, but I give the person an assignment and tell him : “swim”. I don't teach you to swim. I throw you into the pool and you learn how to swim. If he cannot swim, he cannot be a leader. If he cannot decide what to do and how to do it, he will never be a leader. You have to decide that you are able to do what you want to do and that every success is a decision. Success doesn't mean trying from the first time and succeeding. Success means that you keep trying until you succeed. You fail when you stop trying. Most people they try the first time and say “look I failed that's not working”. Not working? why? Because people are against me because I didn't get any help. I never accept that when I fail, I fail because I was wrong. So how and why did I fail so that I try more intelligently to succeed? I never tried to find an excuse for my failure. I don't blame myself because that's also not useful. What I learn from my mistakes. As I also said it today, in school, we learn for exams, in real life we meet problems and we go through exams and we learn lessons from the exams in real life. So this ability to learn from your mistakes. And to I admit them with confidence, not with frustration, I failed, but I'm going to try again. I failed because I was wrong, because I did something wrong. So how can I next time succeed and this feeling of self-responsibility and self-accountability a leader would never say I failed because my enemy is better than me or because the government fought me. Government never fights anybody or doesn't want to fight anybody. And even if government fights you… I can tell you in many cases I was not supported but I was lucky because I was not supported because I've had to do it with the determination that I want to succeed against the odds. What I'm trying to say is leadership is a decision also. Do you want to be a leader? What I just said, as an employee you can protect yourself from poverty but also you prevent yourself from being wealthy. Do you want this or this? Some people say no I don't want to take the risk. I want the salary and go. Honestly, I didn't want that. In 1972, when I decided to start this multinational group, I started from the car trunk. I didn't have an office. I couldn't afford an office. I had a few colleagues with me and we wouldn't meet on the curb, take our files from the back, discuss things, in the morning, go fight, come back in the evening with the results. Literally, our car trunck was our office. We didn't have an office. I wouldn't say that I couldn't succeed because I did not have money to rent an office. You don’t have money, there must be other alternatives. So, what I'm trying to say is that everything in life is a decision to be a leader that you must first decide to be a leader. And if you want to decide to be a leader that are certainly qualities. The decision comes first, then there are qualities. People must love you. I always say : “To be loved is more important than to be great or feared”.  Rouba: (48:08)I think it’s Machiavelli who said : “It’s better to be feared than to be loved”.  Dr. Talal: (78:17) Ididn't invent anything. As I said, this morning. This is what I learned. I learned from life, but this is the case. Be loved. Love is the most powerful thing in the world and it's the most contagious thing. You cannot love somebody, and he continues to hate you. People feel. They feel if you love me or not. I mean love in the noble of sense. If I love you, you can sense it and then you can then immediately react. I'm not going to look at you like that “look she’s trying to prove that she knows something”. People usually, when they meet somebody they try to find what is wrong with him. This is a habit. It's an instinct. It's interesting. Look how he's dressed. Look at the way he speaks, how he walks. I have learned that every individual in the word is good and there is one goodness. At least in them. Look for it.  Announcer: (49:27)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Stephen Rivera - https://www.linkedin.com/in/srivera/?trk=hp-identity-nameJohnson & Johnson - https://www.jnj.com/FEI Article: Sincerity, Authenticity and Collaboration in Finance: A Q&A with Johnson & Johnson’s Stephen Rivera - https://bit.ly/342iruEFULL EPISODE TRANSCRIPT

Message to All IMA Stakeholders: From Jeff Thomson, IMA CEO, on the Coronavirus:https://www.imanet.org/about-ima/news-and-media-relations/newsletters/inside-ima/2020/3/5/message-to-all-ima-stakeholders-from-jeff-thomson-on-the-coronavirusIMA Middle East-Africa Website: https://imamiddleeast.org/en/IMA India Website: https://www.imanet.org/?SelectedRegion={9153947C-B543-4A34-AF21-8FFD7D42D81E}FULL EPISODE TRANSCRIPTAdam: (00:00)Welcome back for a very special episode of Count Me In. I am your host, Adam Larson and I'm excited to announce Mitch and I will have a new cohost on the series, Rouba Zeidan. Rouba is the communications manager for the middle East and India out of IMA's Dubai office. She'll be joining our Count Me In team to bring you more global perspectives on accounting and finance by featuring inspirational stories and expert guests from the region and to welcome Rouba to the series. I'm happy to bring you right up to our first conversation today. Rouba spoke with Ima, senior director for middle East Africa and India operations Hanadi Khalife. They discussed the timely issues relating to COVID-19 in the region and all the internal and external developments being implemented to safeguard human life and business continuity. Please join me in welcoming Rouba to the team and a special thanks to Hanadi for this insight as we head over to their conversation now.  Rouba: (01:00)So we're going through a globally challenging period. I mean with IMA's regional offices based in the United Arab Emirates, I mean Dubai to be more specific. Can you tell us a little bit about how this region is coping with the situation and then what are some of the highlights of government level initiatives being taken? Surely Middle East and India as you may?  Hanadi: (01:21)Yeah, I think, I mean Rouba and I, you know, we're fortunate to have visionary leaders in the UAE who are shaping the future of this nation and the most progressive, yet very embracing way to ensure not only the wellbeing, but also the happiness. You know, we have a happiness minister of its citizens as well as the economist perspective of the country and the way the country has been managing the Covid 19 outbreak. It's no different. It's really commendable, I think how the country is mobilized to find the rights of the virus, the establishment of additional test centers, including drive-through ones, mass disinfection of roads and public transportation and the creation of public awareness campaigns. And I'm really particularly impressed with the recent ad campaign, because it wasn't aimed only at the awareness, but also at, you know, uplifting spirit and encouraging people to take the time to reflect and not to panic. This, of course has resulted in a full alignment, solidarity and commitment from the people to follow, really thought only the government directives. At the end of the day they are aimed at flattening the curve as quickly as possible, I hold back to a business as usual for the benefit of all stakeholders, especially the most vulnerable ones. Now on the regional level, the regulators and policy makers have also been very busy in all the GCC countries and they're proactively taking measures in order to reduce the negative economic impact of the Virus outbreak. Be it on the households, on businesses and the financial markets with seeing the rolling out of stimulus measures that help maintain households economic welfare. And I hope we see additional initiatives, that will be implemented similar to the Denmark government initiative. The largest two Arab economies are Saudi Arabia. Yeah. The United Arab Emirates have also launched stimulus packages aimed to support companies in the sectors that are more hardly hit like the tourism, the retail and the trade sectors. The central banks have also focused on assisting, SMEs. As you know, SMEs constitute more than 75% of companies in the region. So there are defending loan repayments, reducing, waving, processing and service fees, in addition to reducing interest charges and minimum balances requirements. Now, despite the current low oil prices, the UAE economic stimulus has a consolidated package valued at 126 billion. This is approximately 34 billion, while is why Saudi Arabia is worth 32 billion. Also the policy makers are supporting obviously the money market. For example, they recently the reduced, the overnight lending rate from 4% to 2.45%. I know you asked us about India because India is also a part of our market here. So India has entered stage three after the pandemic, right? Today, I think we're on day five of the nationwide lockdown. And, they're saying like the next 72 hours are extremely crucial to monitor if the infection will explode. The covenant that also has been proactive. They created essential relief funds. The health ministry inaugurated 24, seven national telemedicine and there are also 28 hospitals of Indian armed forces that are now reserved for covered patients.  Rouba: (05:17)Amazing initiatives. I mean it's, it's wonderful to see how aggressive and fast governments are reacting. It is certainly reassuring. So as I mean, as a leader in this region, you've obviously had to take some decisions, some difficult decisions yourself to ensure that, you know, the business continues and then your staff are safe. I being one of them can bear with how well you've managed this fire, but what have been some of your guiding principles during this really difficult time?  Hanadi: (05:49)You know, as a member based not-for-profit organization at IMA, it has always been a purpose before profit. So before any decisions we consider the impact on our employees, on our members, CMA candidates on our supply chain and of course more broadly our value chain. So business continuity is about sustainability to us and not short term gains. And the tone at the top was very clear, and that was communicated from day one by our president and CEO Jeff Thompson. It's really about the safety and health of employees. This is the number one priority as well as abiding by the instructions and measures, that I would expect the government had put in place. This directives really cascaded to regions and guided our decisions. So we all have to act now on our social responsibility duties and we have an obligation to contribute and containing the Virus. I mean it's really spreading like wildfire and play our role and flattening the curve. The earlier we control the spread of the virus. The earlier the economic activities where the earlier we can say businesses from shutting down, the more we can save God the wellbeing of the people and the welfare of the societies we live in.  Rouba: (07:13)So would you say the IMA network globally is still fully operational, conference calling and systems? Everything was put in place. How soon into this crisis? All mobilized?  Hanadi: (07:25)You know, it was really from day one and you would have expect a business to slow down, but the whole team globally is probably busier than average. We are all very connected every day engaged. So it, eally has, we started, we didn't waste time. We started from day one. We took it seriously. I mean I think we were the first to really, take this outbreak very seriously.  Rouba: (08:01)So I mean all of this crises, how is IMA managing the task at hand and what are some of the immediate actions that you've taken?  Hanadi: (08:09)So I believe communicating business priorities is the number one step when managing any unanticipated situation that can result in business disruption such as Covid 19, outbreak it clear the message internally mitigates any confusion in terms of actions and responsibilities required from each team member and his or her capacity. And that will really help them guide the individual decisions. And in the current environment where uncertainty is the name of the game, it's also important to alleviate the anxiety and stress. So I'm sure you've heard of many companies that from the first week of the lockdown has laid off employees, implemented cuts or forced days off. We, on the other hand, is should each and every team member that, that health and safety is our priority. But also assured them of the financial stability and strength of a IMA. Our human capital after all is our most valuable assets and our decisions are stemmed from this priority. Now on an operational level, we were the first to move to a work from home environment. We made sure that we are all connected and have the digital and online platforms that support, that supports our business continuity. All this haven't been made easy because we do have very strong, strong core values and they became part of our team DNA. So business continuity is less challenging for us. And as I said, our purpose guides our decisions. And now more than ever, these extreme times are with members. I will see I'm a candidates and our partners are counting on us. So we have to keep providing them with the resources and products that they need in order to have them strive towards that ambitions or their business scores. The delivery channels of course have been some of them have been disrupted, but with the weekly move to other platforms that enable us to continue to deliver value and modify our offering to the current needs of our stakeholders and of course as you know, the CMA testing remain a priority for many candidates around the world. So we are ensuring that their learning continues by putting in place online resources for their use, extending our testing windows, waiving cancellation fees, put exam scheduling and most importantly keeping them engaged.  Rouba: (10:50)I mean we also have a huge part of the business and the operation is it revolves around CMA candidates and with testing coming up and sold them so many of them around the world. Also scrambling, you know, to continue this how is IMA making sure that, you know, the learning actually continues.  Hanadi: (11:11)I think I've been communicating business priorities is the number one step when managing any anticipated situation that can result in business disruptions.  Now, I know you asked me about the operational level. So we were the first, as I've said, to have the work from home, decision and we made sure it would all connected, and that was easy for us because when you have strong core values that become part of your DNA, business continuity becomes a less challenging. As I said, our purpose guides our decisions. And now more than ever in these extreme times, our members, our CMA candidates and our partners are counting on us. So we have to keep providing them with the resources, the products that they need in order to help them strive towards that ambition. We've changed the delivery channels of our services, but we moved quickly to other platforms to enable us to continue to deliver. you asked me about the CMA candidates and the testing center. This is, this really remains a priority for many candidates around the world. So we are ensuring that the learning continues by putting in place online resources and most importantly keeping them engaged.  Rouba: (12:37)That's all excellent stuff. One of my favorite messages, from, you know, we had a town hall, a global town hall with our CEO and president and the entire team. And one of the core messages was that if we are to come out of this stronger, we need to be a learning organization. So what would you say are some of the key benefits or learnings that you liked that are coming out of this, this crazy transition?  Hanadi: (13:05)Yeah, I think even if it's crazy that there are lots of, learnings. and I think the first thing is that it gave us the opportunity, to really reflect and connect even more with, with each other. we are rethinking and companies should be rethinking their business models from a digital transformation perspective, agility level, and of course the supply chain. Yeah. For me, this transition will expedite the adoption of new technologies. and probably, the assessment of the supply chains, the supply and change. We'll move perhaps to a more local suppliers. We're rethinking the market verticals we operate in no doubt, that will be a dramatic on the whole ecosystem of work and of education. so we are going to learn a lot as individuals, as companies, schools companies will assess the works from home model, the online tutoring, the delivery touchpoints of the products and services. And I think also this transition is reaffirmation that localization is a double edge sword. So local companies who read I little and their supply chains, on exports, companies who are more agile will be the ones who would recover faster from the crisis provided of course. they received adequate support from the government. And a key learning for me is the importance of corporate social responsibility and the necessity for the oil, the society constituent to work together, for the benefit of the society and the planet. Because all of us individuals, companies, government, our actions and decisions are interrelated. Definitely interesting times ahead. And I hope to understand the lessons learned and act upon them because most, most of the time we tend to have a very short memory. But I hope that this won't be the case.  Rouba: (15:23)Yeah, I hope not either. I mean, there has to be a learning, right. So, I mean some other leaders, in the region and globally going through the same challenge, what advice would you give to these leaders from your experience?  Hanadi: (15:40)Yeah, it is indeed very challenging times. I mean, we've been dealing with complexity, volatility, uncertainty and disruption for a few years now. You know, there's the saying change has become the business constant, but I think the crisis that we're facing now is of a different magnitude. So the pace is much faster and the risks, the risks, have greater impact. So actions now and those of our teams will determine the fate of our business. We need to both as leaders now manage and lead effectively. So as managers we need to make immediate choices and allocate resources and as need. Those we also need to pull back a little, take the holistic view of challenges of opportunities and come up with plans to ensure business continuity, at the end of the day organization that would show it as a yes, we'll make it through again, setting the business priorities. Strategize frequently is that the crisis management unit that works on scenario plans and action plans. And I believe the speed of action at this point is more important than getting consensus on the decisions we need to stay focused, engaged with our stakeholders, coordination, solidarity between OI stakeholders. I'd also crucial and for those who still under estimate the seriousness of the situation, I hope they are very, very few by now. I advise them not to fall in the optimism bias or the worst stick that has in the sand and pretend this is not happening. And on an individual level, my final advice is probably influenced by my NLP training. I'd really like to invite and urge everyone, leaders, individuals, to take care of the emotional and mental health as well as the wellbeing and the wellbeing of the people around them.  Announcer: (17:43)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Richard Starkey: https://www.linkedin.com/in/richardstarkeyyves/CronosNow: https://cronosnow.com/meet-the-team/FULL EPISODE TRANSCRIPTAdam: (00:05)Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson, and I'm happy to bring you episode 58 of our series today. We welcome back Richard Starkey, serial entrepreneur, digital nomad and one of the first guests we had on our show. He talked to Mitch again this time explaining his shift in business focus and highlighting the benefits of being a digital nomad. Richard's first episode remains one of the most popular in our series and we're sure the second one will be just as well received. Let's go to the conversation now.  Mitch: (00:42)The last time we spoke, you talked about how CronosNow automated a lot of accounting services. I know we've kind of focused on the small to medium size businesses, entrepreneurs, the opportunity that you recognize since that conversation. How is your business focus really changed?  Richard: (00:58)I think it's been quite an interesting journey because we've landed up actually never in our niche quite a bit and that's been driven by our marketing. As I personally have learned more about marketing, which is key to any digital nomad will you, if you can't market online, you can't fit an income and the other aspects is also just increasing the speed at which we learn about the new systems that we implement and the way we implement them for clients has become a lot less so we can, we can implement a new system in a fraction of the time compared to what I thought we would be able to even even a couple of months ago. So I think we've learned to kind of be the monster of a very small niche. We get things done quickly and marketing that niche in a much more effective way. How clients get the gains because we are able to pass a lot of the cost savings along to them. but also we get to keep up what are those gains, which means we're more profitable on net space that we make and I just, I've learned in that space that's as an accountants and I think I might be, I'm definitely going to generalize in my next statement, but we do have a tendency to overcomplicate things, right? And the tail wagging the dog as aware. And I've just really learned about the importance of the principle that it 80-20 rule and the reality that although accounting is incredibly important to us and perfectionism in that space, it's quiet, quite difficult to overcome for most of our clients are entrepreneurs. You know, the accounting and back office function is never going to be something that turns them on and gets them excited. Right? It's something, it has to be done and only if it becomes an absolute priority if something's going wrong. Mmm. So yeah, it's been a very interesting, especially in the digital nomad world because that's what we are, my wife, myself, our staff. But that's what our customers are.  Mitch: (03:07)And I just want to kind of clarify something for our listeners too. You mentioned the principle and 80, 20, you know, what in your opinion, is the end goal of following this principle? You know, what are you actually trying to accomplish?  Richard: (03:21)The end goal is that we need to deliver on an objective. So obviously it's about fitting the objective correctly, but that 80 20 rule for us as accountants means that we, we actually deliver it. We don't land that we're running over budgets. We don't run into never, never systems that never end. So it's about delivery and efficiency in that delivery.  Mitch: (03:44)So I think, you know, being in this technologically advanced, you know, business environment, having the opportunity to really complete, I know what you said about 80% of what you're looking for with automation. So roughly 20% of the time, you know, that's where the cost savings comes from that you were referring to, right?  Richard: (04:04)Oh yes, absolutely. So I think there's the kind of sets, the 80% of aim to deliver the 80% in the 20% time. And then along with that, the, another application of principle, which we've discussed previously, is looking to automate, a lot more of the FM cost. So if we can achieve 80% of what we want in terms of automation with 20% of the FM costs, well, I mean we have to let go affection as tendencies and deliver on what the customer wants because ultimately the customer also one better to lower costs. So you can deliver 80% with automation, with 20% of the efforts. Why not?  Mitch: (04:54)That's perfect. Yeah, I just wanted to make sure that, you know, we kind of clarified that and know another, the term that you've referenced now is the digital nomad. And I know, you know, I've done a little bit of research on this and my understanding is it's essentially someone working exclusively online. So I just wonder if you can kind of expand on that a little bit and tell us what that really means to you and for your firm.  Richard: (05:21)So first of all, I agree. And in terms of the simpler kind of view of the term digital nomad. It's all about somebody can work online. but for me it goes a bit deeper. It's about, about having freedom rights. So it's, we can work. My staff, myself, my wife we work from wherever we want in the world. So we have freedom in terms of location and to large extent, we also have freedom in terms of time. So yeah, we could be working and we've done this quite recently, sitting on a beach in Cape town, you know, I'm sitting with a non alcoholic beverage while we're doing our work, but that's, we could just as easily be sitting in a coffee shop. So that ability to work online and deliver the same results, but actually at a lower cost is what drives our effectiveness in the, they're just from nomad space, if that makes sense.  Mitch: (06:20)Yeah, that's great. And I am quite envious of sitting on the beach in Cape town. I think that sounds like a great place to work. but I know, you know, you're not the only one. And what I mean by that is many businesses are going online, a lot of client services are being provided remotely. So I'm sure you can speak to this better than I can, you know, what are some of the challenges of working in that kind of environment?  Richard: (06:45)Ah, so I think there's quite a few challenges that come with it. I'm far outweighed by the benefits, but some of the challenges if I talk about it from an accounting practice perspective is that a lot of our clients, sometimes we'll battle with the technology for communication specifically. So yeah, you and I might be comfortable on zoom. Another of customer might understand Google and other one might know Skype. And this is actually quite a geographic thing, which is interesting. And learning when we actually just got to pick up a phone, for seven clients. so I think the, the challenges really come down with your client's comfort with the technology that you use. And I'm also seeing a shift in order to make that easier, which is really a way of overcoming some of these challenges is I'm really enjoying the shift to single sign on, across devices. So, you know, sign in with Google's name with Facebook. So I generally will try and overcome these challenges that customers feel about the fear of new technology when your system by trying to find applications that fit with the accounting software, with the imagery management software, et cetera, that fits with software that they really have signing for. And I'm just loving G suites at the moment. I'm chasing up Zoho as well, which is interesting. but along with that, the kind of real top Western brands, so if you think about GSV to HubSpot, zero QuickBooks, what of them are also starting to develop a similar look and feel? We will see the fonts look similar. They use of negative space and design and user experience. It looks similar. So I'm not sure if they are doing that on purpose or if it's just the design train. But it is quite interesting. I'm noticing that a client who's comfortable in G suite would generally be comfortable in HubSpot, be comfortable in QuickBooks or zero because it looks, feels similar. so what are the challenges? I might find a a new toy at the moment I'm playing around with Zoho because of the Zoho one package that just looks like incredible value, but the look and feels different. So I spent all this time building our customers into a nice combination that looks and feels similar and Zoho has got a different board process behind it, a different design. So for me to convert a customer into that space, even though their savings, the learning curve is the challenge because now it looks and feels different again, very much. How, or even going back five years ago when you were trying to get someone to move from Skype to Google Hangouts or you know, especially in the U S zoom has taken over. So it's their look and feel that familiarity, which is a human to human nature for matter. If it's what caught a driver, what technology they use.  Mitch: (09:52)That was kind of really focusing on, I would say, the communication with the clients. Right. And how you're able to kind of essentially deliver the services of your business. But what else is it about this digital nomads, business and, you know, AI, different things that affect traditional accounting. I know you briefly mentioned earlier some of the things that go into, you know, potentially like reconciliations or, financial statements. You know, how has that part of your business really evolved even more?  Richard: (10:29)Well, it's been such a, such an interesting, well last 12 months, I would say. The developments of, I'm not sure if AI is the right word, but I think of it in my layman accounting mind as artificial intelligence is the ability for software, for instance, to, to read a document, learn how it's been extracted and allocated before and replace or speed app, a huge amount of what used to be a men, you know, bookkeeping process. So, for example, you know, well accountants would would understand the pain of getting a couple of hundred expense proceeds, right? Brought to you in a terrible folder that you would now set. It sets me to catch a manually into an accounting system or spreadsheet even, Now with programs like receipt bank will have doc, you know, you just literally asked your customer and it's beneficial for them as well. Don't bring it to me, just take a photo with the phone using this app. Very simple every day that's uploaded receipt bank, Hubdoc, whatever system you're using, read those receipts and is incredibly accurate and has learned which accounts those need to be dedicated to. So if I take an average client to who runs no credit card and is paying for a couple of expenses and steps by cash, are saving three, four hours a week in terms of data capturing. And on top of that we're saving because there's less areas. So I'm seeing customers in terms of time having to be spins that would usually be bull. We are able to reduce that billing by 50%. Sometimes right at a high accuracy level. There's another program DocPass, which I've started using, which doesn't just do expense receipts, but you might have huge PDF documents sent from a warehouse,   , scans a few minutes of setting it up and you've got all the data, there's just all ready to go and you can feed it into what an assistant you need. It really is amazing. With that from an accounting perspective, if we get away from the in house bookkeeping, functional data and she functions, the financial reporting function I think is, it's changing around the world. I talk a bit more from an international accounting perspective. I'm an     risk. I'm not a U S bought guys match being in the UK and South Africa, but, and I believe the U S is a little bit further ahead of the rest of the world, but they are now really working hard on what they call the taxonomy. All right. And the adoption of XBRL, which is extensible business reporting language. There's really, it kept being adopted around the world, which means that financial statements that are submitted to a company house or sec or wherever it may be, are coming in a standardized format that's understood by XBRL and therefore can be uploaded very consistently to not only company house administration reporting systems are only tech systems, but also financial research and yeah, market data. it really is changing the way that we're able to use financial statements in a large scale, I bet. Makes any some sense.  Mitch: (13:57)Oh, absolutely. And I think it's a great way to kind of wrap up the conversation and you know, we started off by talking about the different advancements in technology, how that's kind of reshaped your business and you really tried to focus on this niche market. I last question to you is, you know, you seem to be very forward thinking and proactive in adopting these new technologies. Recognizing opportunity. Where do you see some potential room for improvement in the business as it stands now? You know, what do you think might be next as far as adjusting your services and making it even more valuable to your clients?  Richard: (14:36)The, the next step? in terms of my CronosNow business, which I'm sure a lot of other smaller practices, you know, we aim to keep small so we can keep high levels of customer service, etc. But you also want to be able to scale to some extent and the old model of accounting practices would, you would have an army of yeah, first and second year young accountants with a few senior people would have a systematic approach with data going in and kind of hang out. But now that's not where you're making many more. You can't justify charging big fees with data capture. So where we bring going forward is how do we add more value to a customer beyond the counting? How do we help them make decision making? How do we use that data more efficiently, not just for tax returns? So at the moment it's quite an interesting space because I've got a lot of experience as CFO and CEO level, over the last 15 years before I came back to the accounting space. But to try and Cision that knowledge in a formulaic and systematic way is something that I'm wrestling with now. I do have a sense that as all this data in his system had been built out, computer processes and systems will be able to drive accountants adding value even though they don't have the experience. So it would be a bit like a doctor who, you know, maybe doesn't study for seven or eight years in the, in the, in the not so distant future, but maybe he can have a shortest amount of studying in a shorter amounts of experience that he can get out and have a bigger impact quicker because he has a huge medical reference behind him, right. That the computer can almost help with diagnosis. I think accounting systems, the financial systems will help with business diagnosis and entrepreneurial diagnosis. so that along with the global kind of nature where my business is going, is trying to lead me to really think about how do you help not just the business, but the entrepreneur, be a true digital nomad. How do they go with their treats and best with the tax rates fit what they're getting back from that country? How did they get the freedom to go live in Europe or live in Asia if they want while still running their business with a proper system of processing control? So we're learning about that next stage. What's beyond the accounting system? The accounting system works nicely. It works smoothly. It's nice. It's cost effective., How do we add more value?  Announcer: (17:10)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

FULL EPISODE TRANSCRIPTMitch: (00:05)Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. As we've said in previous episodes, IMA is here to support the profession through a variety of resources to keep management accountants connected during this time and a portion of our profession that has been significantly impacted by the movement to remote work due to the Coronavirus is the accounting academics. Yesterday, as of the release of this episode, I may presented a webinar on tips and strategies for effective online education. To further meet the needs of our members and our extended listeners. We would now like to share this bonus podcast, episode four leading remote learning and managing online students. Adam spoke with Wendy Teitz about what can be done to better transition and in-person curriculum to an online one and facilitate these online classes. Wendy is an accounting professor at Kent state university and a veteran to online teaching to help others who may not be. She shared some very timely advice as she walked Adam through lessons she's learned along the way. Let's head over to their conversation now.  Adam: (01:14)Wendy, thanks so much for coming on today. We really appreciate you coming onto the podcast. You've been a professor for a while and you've taught classes in person and online and with the state of the industry and everything that's happening with the pandemic right now, a lot of professors are being thrown into, becoming online professors now. And what advice would you give to somebody just starting out?  Wendy: (01:35)Okay. I would tell them to take it slow, do a little bit at a time. Right now it's a big order to say, oh, convert to online in the next three days. So take it day by day. You'd know that you're going to make mistakes. The big thing is to be flexible with your students. Be flexible with yourself and know it's not going to be the best experience for everyone. But that's okay. So the primary concern is that we're all safe and healthy and that our students education continues.  Adam: (02:10)I think that's great. So I know each college probably has their, has different technologies that using. What are some technologies that you have used that have been successful for you?  Wendy: (02:22)Well, I have a large class. So before this pandemic hit, I was teaching classes. I have between four and 600 students a semester. And my students have the option to attend class in person so they can in a traditional environment just like you picture. But then I also have an option for students to attend live online where they can see the screen, they can hear my voice, there's a chat room and they can ask questions. So kind of webinar style. And then the third option is they can view the recording for the day and then answer the questions on the recording. So I have done that for several years. So when the order came to shut down, classes, I was probably impacted less than anyone else because I have the infrastructure. So I have, over the years I, I've developed the delivery online and recording simultaneously. But I also do things like I do record step by step tutorial videos so students can learn at their own pace. I've also done, I do a variety with different social media. so for a couple of years I did Snapchat where I would show examples in real life of what we were studying in class. I've done Instagram way back when. It was just beginning. I did Facebook groups. and most recently I started at group me. And this was in reaction to the pandemic that we're trying to reach out to students because now no one has the social system that they had before. So now I'm trying to reach students and make it more personal experience because so much during the regular semester you see students in person, you know that they're seeing each other. They may be watching the class together in their dorm lounge, but now everybody's their own little Island. But over the years I've also used, I also use polling software and I can continue to do that online. That's not an issue because I want the students to engage with me. So my class is not simply broadcasting videos but engaging with me and I'm using all those resources that I can leverage into the class if there's a valid reason for it.  Adam: (04:45)You know, I like the idea you mentioning of finding ways for the students to connect to each other. Are there any other ways that you're doing to kind of help create that community that the class that the class usually creates for people create study groups and they, they look at things together. What are some other ways that you're helping that the, the class kind of build that community?  Wendy: (05:04)Well, since the pandemic occurred, I did start the group may, which is a mobile messaging platform. So I've had several students join our group, me and that way they can ask me questions faster and then I can reply and then they can find other people in the class that maybe they want to form their own electronic groups with. So I'm trying to facilitate that. I'm also in, normally during the academic year, we have a chat room, every class day and my graduate assistant monitors the chat room and she will answer any questions. And during a regular time, non pandemic, I always say keep the chatter down in the chat room. It can only be on topic and because things were normal. But now that everyone's all over, I have students all over the country now and I feel like everyone's all by themselves. We are making a real effort to in that chat room start asking students questions like, how are you doing? Or where are you right now? What's happening in your classes? So my graduate assistant has instructions to try to chat with students and we're getting some success there. One thing that started a conversation, the chat room was Monday, I was talking about property, plant and equipment and I wanted to show how land and a house are two different entities. And so I put up a picture of this old Victorian house that happens to be in the city of Kent and put it up and started talking. And all of a sudden in the chat room, one of the students was saying, OMG, OMG, OMG, that's my house and here, she lives there. So she hadn't really talked much all semester, but now she's like, Oh no, that's my health. That's where I live. I'm not there now. But it was really interesting cause then other students start asking and there was a conversation going. So we're trying to build the sense of community even though halfway through the semester everything changed. And then, another thing that I did is Monday, Snapchat had a filter where the filter, I took a picture of my cat cause who doesn't take pictures of cats. I took a picture of my cat wanting to send a Snapchat to my children. And so the filter was my work at home coworker and I thought, Oh that's funny. So I thought, well let me give it a try, put it in my slides for the day. And I introduced my cat to my students and said, send me your own pet pictures so I can feature them. And I got a bunch of pet picture between Monday and today. I just got some pictures today and I continuing to get pictures. So that seems to be a way that they're communicating with me. And every time a student sends me a picture, they sent me a little note about what's going on. So I'm hoping that's me to them, but I'm hoping that I can be a little more personal for them. Then I feel like we really have to work hard to make school feel more personal than just this is my computer and this is my lessons spewing out of my computer. And so I did challenge my students since this is, we have spring break next week and it's going to be a spring break. Like no other spring break. We are in Ohio, so bars and restaurants are closed. All of the education places are shut down. Libraries are shut down. Probably not a typical spring break location destination though the library. But anyways, the students are at home and so spring break is going to be different. So I asked my students to take a picture over spring break of something they did that was unusual and that they're willing to share with us. So we're going to see what they come up with when we come back from spring break. So I'm really excited and in some ways that now I'm having to deliberately forge connections that I could take for granted before because the students were together in their dorm rooms or another classes and now everybody's support system has gone. So I'm trying to work really hard to build those connections in kind of this cereal world that we're in right now.  Adam: (09:30)I think that's great. Just finding ways for people to find those connections and even outside of the school setting. Cause a lot of times we connect on things outside of whatever we're studying or working with. But then once we find that connection outside of that, then suddenly we are able to connect on the academic or even even a work level.  Wendy: (09:49)Yes, exactly. I mean I find myself too, I had a colleague call me yesterday and she said, she said, I'm so lonely. I don't see anyone, she said our offices are side by side. And so we decided that we would start doing teams meetings a couple days a week with the video camera. I mean it feels weird at first because we've worked together for 18 years side by side and now all of a sudden we're doing it seems meetings. But, I think we need to also worry about faculty is their connection because I think it's easy for faculty who have never taught online to lose that sense of connection with people. So, I've been doing some webinars with people about how to build student engagement and I think that's a big piece of it cause it's not all just the academics. I think a large part of our education is built on our personal relationships.  Adam: (10:43)No, I agree. That's great. So how do you think this is going to affect, professors and the accounting space or even just the teaching accounting? Just teaching education in general in the future going forward?  Wendy: (10:55)Well, I first of all would never wish the pandemic on us, but I think there can be some good that comes out of it. I think first of all, everyone is rapidly getting used to having virtual meetings. And I think that is a good thing because then maybe we'll be more deliberate before we travel off to a meeting. And as we get more used to virtual meetings, we're thinking this is okay. So maybe less travel. And that's good from a worldwide climate standpoint. So that's one positive. I also think that faculty are having to build up their arsenal of teaching tools very rapidly. So they're having to learn to do it all at once, like being thrown into the deep end of pool. And that's not ideal, but I know that faculty are going to do it. They are going to rise to the occasion. My colleagues are working hard. Yeah. And they want to do it. So I think they're building more tools for their teaching toolbox so that when we do return to that normal world in the future that they will be able to use different tools than they had before where appropriate. Because maybe they've always taught lecture, face to face, but now maybe they can envision doing some videos that they could assign outside of class that are more suitable for students to learn on a one-on-one, you know, kind of positive video, cold forward positive video. so I think, I think it's going to enrich our teaching in the long run. I do. I think this was a great thing to do. Absolutely not. But I have been so impressed with my colleagues willing to do this and saying, okay, we've got to do this. I don't hear anyone whining. I do not hear anyone complaining. I just hear people asking for help.  Announcer: (12:45)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Heather's article: https://www.linkedin.com/pulse/6-tips-new-remote-worker-heather-fletcher/Heather's Linktree: https://linktr.ee/heavenhealing FULL EPISODE TRANSCRIPTMitch: (00:05)Hey everybody. Welcome back for another bonus episode of Count Me In. I'm your host Mitch Roshong. And today I'll be bringing you right up to another conversation on how to best manage working from home. This time Adam talked to Heather Fletcher, a freelancer and candidate manager who looks to offer some quick tips to help anyone who is new to working from home for another perspective that'll help you settle into today's new norm. Let's listen to the conversation now.  Adam: (00:37)So there's a lot of people who are finding themselves in an extended period of working from home. And, we wanted to reach out because, you know, you have a great article on LinkedIn and we just wanted to see, you know, do you have some tips on how people can be successful and kind of stay sane as they find themselves in this new world of probably having kids home from school and having to work full time and just trying to balance all those things. what's the advice that you can give them?  Heather: (01:03)Oh yeah, I mean, I feel like it definitely depends on what things are happening that are important for you. Like people with kids, obviously their type priority is figuring out how to juggle work and taking care of their kids at the same time. I've already seen people post articles on this as well. It seems like some of the best tips that are for almost everybody is to get yourself on a schedule. It's really easy to be like, well I can sleep in, I don't have to drive anywhere and deal with traffic and then all of a sudden you're just kind of lollygagging around the house until it's time to start working. So keeping to a regular schedule really is a big help on that one. I feel like that's probably one of the top tips I can give you, but it's also still really important to get a lot of sleep to take care of yourself. So you're keeping your immune system up, eating healthy instead of snacking all day cause you're at home. I really feel like planning your meals, if you already do that, keep doing that because you're going to find that as cool as it sounds to cook yourself a fresh breakfast, lunch or dinner, it takes time to set up, prep, cook, serve, and then eat those things. So if you've already got a few meals planned for you, it's going to help your day go by a little more smoothly without stressing about how long it's taking you to chop vegetables, that's for sure.  Adam: (02:29)And then if you're making food for other people as well as yourself, then it gets even more complicated.  Heather: (02:33)Exactly. Like, yeah, like people that with the kids, maybe your spouse is home at the same time too. Maybe your roommates are home. If that's the case, and you've got all those people home. Another tip I would like to share is to try and find a space that doesn't have all those people in it. Maybe a place that you can shut the door on those people for a short periods of time if you need to. Cause it's, it's really easy to be distracted if you're sitting in maybe the, maybe you're sitting in the dining room and your kids are watching TV in the living room and then maybe somebody else is in the kitchen doing stuff. So especially if you have to talk to other people, those distractions that are nearby, it really helped get you off course without even, you just don't even notice it until an hour has passed sometimes.  Adam: (03:19)Definitely. So it's talking about, speaking of talking with people and speaking with other people cause she coworkers or clients or whatever your, whatever your job is, what are some technologies or some tools that you've, you've learned to use over with your experience working from home?  Heather: (03:35)Oh yeah. Our company uses a specific one called Nextiva. That's going ti be a bigger program for a bigger company. Perhaps you might not be using that already, but Skype is super easy and it's free. So you can call anybody. That way. You can use video chat or not use video chat, whatever works best for you. you can still use your phones. You still need to keep in touch with people. Email is probably going to be one. People are going to just remember that communication gets a little more difficult when you're not face to face with somebody. So give a little leeway for the person that you're talking to. Give them the benefit of the doubt. If you maybe misunderstand what they have said cause it always makes sense to yourself when you're saying something. But sometimes from the other person's perspective it doesn't come out that way. So our first reaction can sometimes be defense or offense and give yourself just a little bit of leeway to call that person and clarify ahead of time before you react one way or the other. Because more often than not, it's just going to be a small misunderstanding that you can clear up with a quick phone call.  Adam: (04:48)Now as you give that example, I feel like there's a, I feel like there's a personal experience in that. You want to share a personal experience where the communication didn't go as well and you had to clear that up.  Heather: (04:58)I feel like, honest to goodness, it probably happens once a week for me. I have another coworker that I work with, she's got the same name as me and we talk a lot. We're really interfacing quite a bit, but every now and then I'll send her a message just thinking I'm sending her like a quick message and it will sound offensive on the other hand and I'll need to give her a call and apologize and let her know that's not what I meant. And then I've got her back 100%. Because when you start to let those like little seemingly trivial things slide, they build up a bit and the sooner you can clear up that misunderstanding, the sooner you're moving on with your day with a clear head and clear heart.  Adam: (05:42)Definitely, definitely. It's always good to get it out in the open right away and not let things fester because as human with friendships or with family, if you don't communicate clearly and then if the other person doesn't understand it quite well and you don't clear that up, you know that goes into 20 years of never talking to a sibling.  Heather: (06:01)Exactly. It's a big problem with text messages in general. I tell all my friends and family, the second your text messages bring up in emotion, stop and call because a text message is for like, yes, no thank you. I'll be there. Be there. This time when you start to get into these like quote unquote like deeper conversations that have meaning to them, you really need that tone to set the stage for what you're saying with somebody.  Adam: (06:33)Definitely. And it's even important to use something like a webcam because when you're saying something to somebody, you may not see their facial expressions and how they're looking. And so how has a webcam been important in your experience?  Heather: (06:47)A webcam has been really important, especially on my side of podcasting. When you're speaking to somebody like you and I are right now, it's really helpful to see their face, to see their happy reaction. Their less than happy reaction, they're confused, reaction, whatever it's going to be. So you just kind of giving yourself a leg up if you will, by allowing that video conferencing to happen. And I'm not saying you need to get dressed up, you don't have to do full makeup, put gel in your hair, anything like that. You just need to have your face on the camera and you're good to go. Don't stress about all those day to day appearance things that you stress otherwise unless of course you're at a certain level if you will. And perhaps you're speaking with a customer, then of course you want to, you know, judge it up a little bit. Adam: (07:41)So that we've discussed technologies, you know, how can, what are some tips of being a good team member when you're a good virtual team member because we know how to be a good team member. Where in the office together, you know, we can have conversations. You go see people say hi, what's a good way to be a good virtual team member?  Heather: (07:57)That's an excellent question. I really feel as though keeping in touch with your team members is going to help. If your team is using discord or Slack or maybe LinkedIn as their main search, go in there, respond to people like their posts. Make sure that you're asking questions when you need it. There's, it's really all you have to do is kind of respond. You don't even have to go out of your way cause folks are going to be looking, look into reach out at this point in time. Make sure you're there for them when they need it. And don't forget to give each other a call. Maybe you haven't talked to a coworker that you normally see on a daily basis and you just want to say what's up and see how it goes, how it's going. They're going to be in the same boat as you, so they're going to understand, don't be afraid to pick up the phone and give them a call, even if it's just to say what's up. but I definitely feel like biggest thing is to keep that communication line open. And like I mentioned previously, if you can also give each other the benefit of the doubt, like a hundred fold more than you normally would cause everybody's extra stress, nobody knows exactly how this is going to go. just give each other the benefit of the doubt and that's going to be really a huge thing to help each other when we're communicating in this new way and learning how to navigate this different system of work.  Adam: (09:28)That's such a great example. Like just today, I hadn't talk to one of my coworkers and so I said, Hey, let's do a video chat. And so we did a quick video chat and we just talked for 10 minutes and we actually didn't talk about work at all, but it was really great to see somebody else's face even for 10, 15 minutes just to say, Oh, Hey, you are still there and we can have a conversation. So I think that's some great advice.  Heather: (09:50)I love that. That's it. And that's, it's fun too. It kind of picks you up. Those little micro interactions keep your mood up throughout the day and they're going to keep your mood up in the virtual office as well if you keep doing them, even though you have to do them in a different manner.  Adam: (10:05)Definitely. It's like going by to your coworker's desk that you haven't seen in awhile and just talking to them for a few minutes and then walking back. It's, it's that same kind of feel.  Heather: (10:14)Exactly. Yeah, absolutely.  Adam: (10:16)All right, so we've given everybody some tips. We've talked about technologies, but everybody's still home. We're home working from home. How do you not go stir crazy? What are, what are some things, some self care tips you think, and we can give the listeners.  Heather: (10:31)Number one, don't stop exercising. Maybe your gym is closed and that's totally a bummer, but if you have the availability to walk outside your house and take a walk around the block, you would not believe how much. Five to 10 minutes of that vitamin D can help bring up your day. Take a walk around the block, walk up and down the stairs. Do a few minutes of yoga or meditation, call a friend. I mean, we can't hang out with her best friends in person right now, which means we need to be all that much more diligent in keeping in touch otherwise. So take a little break, call a family member, call a friend, something like that. And last but not least, if mental health is something you're concerned about, maybe you're not just going stir crazy. Maybe you need to see your doctor that you're not able to see right now. There are a lot of really cool mental health apps available right now. One I've even used personally is called Talkspace online therapy. You can actually talk to a doctor through video or just through text from this app. So if you don't have the ability to see the person you need to see, maybe this would be a good alternative for you. It's also a good place to find meditation apps, habit trackers, things to keep you on track while you're in this new environment that you're not used to. So utilize the technology that's out there for these kinds of things. Give it a Google search for whatever your issue happens to be. And I promise you you're going to find an app that can help you out with that. Well, Heather, I really appreciate you giving your insight and, from some of your experiences and coming on the podcast today. It's been a pleasure. Seriously. Thank you so much for inviting me on.  Announcer: (12:13)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Peter's website: www.petermargaritis.comPeter's books (Both books can be found on Amazon in paperback and Kindle.  Improv Is No Joke can be found on Audible)" www.TakingTheNumbOutOfNumbersBook.com http://petermargaritis.com/improv-is-no-joke-book/ Change Your Mindset Podcast (Can be found on Apple Podcasts, C-Suite Radio, Spotify, iHeartRadio, and many other podcast platforms) Apple Podcasts: https://podcasts.apple.com/us/podcast/change-your-mindset/id1127514117 C-Suite Radio: https://c-suitenetwork.com/radio/shows/change-your-mindset/ Spotify: https://open.spotify.com/show/5EXc70lxp3g6SWXBab596y iHeartRadio: https://www.iheart.com/podcast/256-change-your-mindset-30921543/ FULL EPISODE TRANSCRIPTAdam: (00:00)We are back for another episode of Count Me In. I'm your host, Adam Larson, and we are now up to our 56 episode of the series. For today's discussion, we are going to hear Peter Margaritas, the accidental accountant. Talk to Mitch about the value of storytelling and accounting. Peter is an engaging storyteller himself. So we will cookie jump over to hear his perspective now.  Mitch: (00:25)Thanks for joining us today Peter. And as I was just kind of mentioning to you, I've done a little poking around, a little background checking here and I came across, the accidental accountant. So I'm wondering if you can kick that off and, you know, tell us a little bit about what that means.  Peter: (00:46)Oh, what that means was I didn't get into this profession until I was 30 years old. I'm Greek, I'm a Greek American. I really should be in a restaurant versus being a CPA. And I grew up in a very good Gary us environment, worked in many restaurants, were very customer focused. And when I got into the accounting profession, I understood it. I loved it. I'm not kind that does it very well. And actually in one of my reviews from my employer before I even sat down, she said, how in the heck did you ever become a CPA? The CPA can get all the way down to this detail. I'd only get you about three quarters of the way. You're an accidental accountant. And I thanked her for that. That was the nicest thing she had said. And so I, I've actually taken that and it's registered trademark and is, I'm doing business as the accidental accountants.  Mitch: (01:40)That's great. So as I'm going through this and I come across some of your other work here and I saw an article that you put out there, I believe it was accounting today. And, my next question is really about the profession in general and, and how has data and technology really changed the accounting industry in your opinion? The article was written about whether or not gap is really in touch with today's economy. So how does that all piece together?  Peter: (02:06)I think by the 1900's I mean we really talking about data analytics or even in the 20s now we're so data-driven and analytics-driven and, but if you sit and think about what accounting standards when they're written and when FASBI is proposing them primarily for publicly held entities, especially very large publicly held entities and they do feel tested and they get these luxury organizations to be part of part of it. But a lot of companies out there use gap statements because it's required of them to use gap statements. And they're much smaller entities. I mean the complexity of a gap, the revenue, the new revenue recognition standard, which is principles based now rules-based, there's over 700 pages. The convocation has over 10,000 pages. So what we're trying, and it seems like we're always trying to catch up, and think about back when the derivatives and during the Enron years and we were trying to write standards, what was it? Fin 46 and Fin46R then, there were SPEs, now they're VIE's we were writing them. We felt like we were, yeah, four or five years behind. We looking at today, you know, the SAS applications, you know, business software applications are being delivered on demand via the cloud and some of the metrics that are important within these organizations as recurring revenue, you know, churn rate, the number of subscribers which are crucial to their business. There's no way fashion is not addressed any of these things. So there's, I've, I've always felt that there always has been somewhat of a, gap, lack of a better term between, you know, what we're writing and where the U S economy is going. And we've, it's gotten so complex that counselors can even describe to the clients. And when I say clients, I mean both internal and external CFOs, you know, in the, in that group to their clients, what the purpose behind it. What we're doing, how do we apply it? It's very, very complex.  Mitch: (04:28)So I guess, you know, what I'm curious about really is, aside from the complexities, aside from being behind the times, essentially, what challenges is this really causing for today's accountants? And how are these standards, you know, really hurting the performance of today's accountant.  Peter: (04:49)I'll share a story with you. As soon after that article came out, I had a partner firm contacted me here in the central Ohio area and she said, I love your article and as you shared the story with me that their firm was doing a after hours gathering, CPE kind of gathering and they invited all the community and local banks in the area into this thing. And basically they were talking to the banks to see if they would start accepting the AICPA SME model for standards versus US gap because of the complexity. Yeah. I'm a former banker and I, bankers don't really understand the complexity that we're dealing with and when we're trying to, like my buddy who is still in banking when rev, rec, and leasing was coming out, he contacted me, he goes, so you guys just make standards to keep your jobs to be irrelevant to, is this like full employment? Now? What, why not? But perception and reality are so different. And when we try to communicate these standards to our clients within the organization, like consolidations vie's, there's thousands and thousands, hundreds of pages out there on this topic. And when we're just data dumping information, Oh, we're doing this, put it in sleep. Well we need to learn how to well well I asked my audiences is well a question like how many of you speak a foreign language? And I mean a few hands, you know, French, Spanish, Japanese. I said, let me reword that question. How many speak the foreign language of business call accounting? And they all start laughing and I went, it is a foreign language to the sales department, to human resources, to every part of the organization. Other than accounting and finance. Have you ever tried to explain anything to a sales, our HR person, whomever, can you listen to yourself? You're speaking in the foreign language of accounting, we have to become better translators of this language into plain English. And I think that's our biggest challenge is recognizing that we speak a foreign language too. It's important. Why are we giving this information? So management investors, clients can make decisions, but if they don't understand us, are they really making the right decisions? It just comes down to the way we communicate and we're not known to be the best. We're the stereotype of being introverted, you know, very technical, very geeky and nerdish whatever. We have to break that stereotype. We have to bring value, we have to show value in what we do. And the only way we can do that as we can articulate the value that we bring, what we're doing for our clients, our customers are our organization.  Mitch: (08:01)Yeah, that's a really interesting point because even myself going through school, all these accounting classes, all the professors are telling us that accounting is the language of business, right? Everybody needs to understand accounting to understand business. But when you kind of put it that way, it's the language of business that only those within the function really understand. And we had to, it's a unique perspective to consider. But you know, along the same lines of what you were kind of just talking about with communication, what else do accountants really need to know today? You know, what should they be learning today as they continue, their education and polishing their skills for today's industry?  Peter: (08:40)When I talked to CPAs and especially those who were just coming out of school, I get this question, especially in those States that have the 150 hours, what should I take? And that extra 30 hours, whatever, public speaking, presentation skills, you know, communication, effective writing, business writing. Our biggest challenge, I mean right now artificial intelligence, blockchain is doing the number crunching for us. The bots are able to reconcile accounts within a matter of moments. We've got a, what's the word I'm looking for? Artificial intelligence. Watson, who we dump a GL into Watson and spits out, well, here's your high risk areas. You need to go take a look at this. So we're not digging deep into the bowels of an organization looking through boxes and boxes of stuff or looking through, you know, digital information. We're getting pointed in the right direction. So if I was coming out of college today, Oh, when, when I'm asked to speak to college, students, those, we call them soft skills, you know, but would you agree with me on this one? We may call them soft, but they're pretty hard to master. Absolutely. And they just don't come over night. There's some folks who, I used to be that guy quite honestly. Cause I've, I've taught Academy at the college level and I mimicked what I saw and how to teach. And I turned into an anesthesiologist cause I was putting people to sleep. So I said there's gotta be a better way, teach this. And I had the PowerPoint slides with it, like a billion bullets up there, the kajillion words and just a big data dump. And the more I began to transform that and too storytelling, using examples, you know, kind of be more realistic in the approach. My student for waking up the, it became engaged in the class and evaluations I would get, he took a boring subject and made it fun.  Mitch: (10:53)Oh, what were some of the, activities or different topics that you weaved into? You know, making this a little bit more engaging because even communication itself, it's difficult to teach. And you know, you said the soft skills are really hard. So what was it that really got through to the students?  Peter: (11:11)I am not a PhD, so I've got a masters and accounting and an undergrad, a bachelor's administration, and that's the administration as well as concentration in HR and in the classroom, and I worked for Pricewaterhouse. I've worked for Victoria's Secret catalog, I've worked for Gapping Direct. I was able to take those stories that I saw, that I learned that I, that I was working with at the time and be able to create an analogy, be able to create some type of metaphor or be able to share that story to demonstrate what I was doing from the technical side. It's a, it's almost like a talk because of the Ted talk. They start off with the story and then back it up with the data story data. But we as, and I say we accountants, engineers, architects, we'd like to start off with the data and maybe not even get to a story and just by doing that, we're not engaging our audience. Our brains are wired for stories, not just a massive data dump like given the dissertation. So when I do this presentation that I wrote about at the university of of Nebraska in Omaha, I've started, I always start off with the story. I asked the audience to close their eyes and imagine themselves given a financial presentation and the audience is looking at them, not their cell phone. They're not doing that conference prayer where they've got their cell phone in their hands and their heads are bowed down. They're fixated on you having this conversation now almost hanging on every word. Can you imagine that happening? Ask him to open her eyes and I go, most people shake their head now that's said it can, and I shared another story with them. Let's get to work. And that's the key word there. It takes work and you're changing up something completely. So you gotta be able to accept some risk here and failure. Cause when you first started off doing this, you will make mistakes and that's fine because you learn from those mistakes. But it is a scary mind field per se because we've, I've never done this before, but a lot of folks who I speak to in the profession, they go, but we need, I need to know how to do this because I'm tired of the deer in the headlights look from my clients, from the sales department. I want to be valued. I want to be perceived with that, with that value that I have with this knowledge that I have. And I can't do it just by a massive data dump. Speaking in foreign language of accounting.  Mitch: (14:03)So not all of us are, you know, in academia and teaching accounting students. But you know, obviously there are ways to translate this message and apply it on our job. So you know, what elements of public accounting in general do you think really need to change and what can our listeners do? What can the accounting and finance professionals here do to help advance that initiative?  Peter: (14:25)So the most important thing, and I'll write this in my book, taking an amount of numbers, the first thing that we need to do is recognize this is not about me, this is about my audience. How well do you know your audience? We come in to a meeting, we come into a presentation, we come into some proposal, we're looking at it from our perspective. We need to change that mindset. We need to flip that around. What, what's the, what's the audience's pain point? What's my client's pain point and determine what that pain point is and then provide them with the solution to that pain point. But not coming in and going here. This is what I have for you. And they don't need that. They don't want that. We tend to, and I do a lot of customization in my programs. I speak to the four language of Academy, but you know something, I don't really speak the foreign language of construction accounting or civil engineering accounting. And I did a half day workshop for the construction finance management association and it was about a nine month process working with one their instructional designers. And I had to learn not to the depth and breadth that everybody in that room had. What I needed to learn construction accounting I needed to learn, but the key words that they use, the acronyms that they use, same thing with civil engineering. So I could've come in and just brought my canned presentation and you know, I've been fine. Not really because it's not relatable to those because they look at the world differently than retail. So keeping us think about that audience, what do they need, what can I give them and how can I give it to them in a manner that is... Have them think like Abraham Lincoln less is more. Lincoln wrote the Gettysburg address in 272 words. The gentleman who spoke before him, gentleman named Edward Everett, former secretary of state, spoke for two hours. Nobody knows Ed. We used to have to memorize the Gettysburg address in school. Less is more and that goes to their, how they design their PowerPoint slides, less words and a picture, last words and, and you're having a, you're not doing a presentation, you're having a conversation with that audience. So when we put less on, on a PowerPoint slide and we're not reading from the PowerPoint side, w which we should never do, we should look at that PowerPoint site in two ways. One, that's a note card. It's going to jar my memory, what I want to speak about. And two, we want to make it easier on the audience. We wanted to design it in a way that's easy on their brains. And we do that by the left hemisphere of the brain controls the right side of the body. The right hemisphere of the brain controls the left side of the body. So in designing a PowerPoint slide, you want to put the picture on the left part of the slide to connect with the right hemisphere of the brain and the taxed on the right side connect left hemisphere of the brain. This is proven and brain science is a book called brain rules by John Medina that he's a neuroscience researcher who wrote a book that even I can understand about the brain and there's so much work when into how the brain function, how the brain operates in certain situations, we need to give that brain not overworking because they won't understand. But when we do a data dump and we've got 700 pages of a Rev Rec and convocations over 10 that's a lot of data. We had to find a way of using less data and provide more stories for our audience to understand. So FASB.  Mitch: (18:42)So that's a really good example. And you know, you've kind of led us all the way through this conversation. We kicked things off starting in the 19 hundreds with accounting and even talked a little bit about the data and the two thousands but I usually wrap up episodes by asking our guests if they have any predictions as what the future of accounting holds. So, you know, we've certainly shifted gears here and we're talking a lot about storytelling. What do you envision the role of the accountant being or how is the role going to change even more in the future of the industry?  Peter: (19:13)I don't believe I think number crunching is over. I went with artificial intelligence to the way technology is just rapidly changing. We have to adapt to it. So if I don't have to question numbers, if I don't have to use a 10 key and if I don't really have to even use Excel, but the information has been placed in my lap, now I have to be able to, I still have to be technically sound and analyze it, but then I have to communicate it more to internal stakeholders, external stakeholders, decision makers. And I have to be able to communicate it in a manner that is persuasive, in order for us to get, in order for us to have that person take that information and use it properly.  Announcer: (20:04)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Jordan's Resources: "So you're suddenly working remotely" https://www.linkedin.com/pulse/so-youre-suddenly-working-remotely-jordan-hirsch/ MURAL's "suddenly remote" webinar series recap: https://blog.mural.co/suddenly-remote-recap Phase2's WFH "How-to" Packet: https://phase2.gitbook.io/phase2-remote-work-playbook/ FULL EPISODE TRANSCRIPTMitch: (00:05)Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong and knowing there is a lot more going on outside the accounting and finance world. We would like to align with Ima CEO Jeff Thompson's message and extend our heartfelt support to everyone facing the implications of the worldwide Coronavirus outbreak. Today we would like to share a timely bonus episode as IMA continues to support the profession with a variety of professional development resources. As many of our listeners are now faced with remote work and distant learning. My cohost Adam had a conversation with Jordan Hirsch to give our listeners some suggestions for working remotely. Jordan is the director of innovation at phase two a digital experience agency with a strong remote culture. He has over a decade of experience working from home and share some real practical tips for those who may not be as accustomed to working outside of the office. If you find yourself handling your business in what feels like a new, slightly uncomfortable work environment, listen to this conversation to help you adjust and get the most out of it.  Adam: (01:15)So Jordan, as we see with the recent events concerning the Corona virus, many people have been thrust into working from home suddenly. I know you've been a remote employee for a while now, so could you describe what it was like for you when you were first getting started?  Jordan: (01:28)Sure. I would say also that I feel for everybody who's getting thrust into it now because it is definitely really different from working in an office, especially if that's what you're used to. When I first started it was, it was kind of weird at first, my very first job out of college way back in 1999, I had an office job and I was allowed to work from home one day a week in that job. And that one day for a while I sort of saw it as my like get everything at home done day. I would, uh, you know, I'd vacuum the apartment, I would do a bunch of chores. I tried to get my work done ahead of time the rest of the week, so I didn't actually have to do much that day. And then over time, as I had other jobs and I started sort of do it more and more, it occurred to me, I started to realize that I actually needed that time to do work and I had to learn how to actually do my job at home. And I was working in tech at the time. So the mechanics of doing the work weren't that bad. I learned how to, you know, which files I would need to bring home from me, uh, to be able to work on my home machine, how to access all the network things that I needed from my job at home. How to sort of minimize the things I would need from the office. But probably the hardest part was learning how to apply some structure to myself to not see it as, you know, fun time or time when I could sort of get things done at home. But how to actually be at work at home was the biggest adjustment. So learning how to really have the discipline to sort of structure my time by myself and how to have that structure while I was, you know, literally all alone in the apartment was, was probably the steepest learning curve for me.  Adam: (03:04)So if there was one thing, there were a couple of things that you could have told yourself back then when you first started working at home, what would that be?  Jordan: (03:11)Probably just because you can do all your household stuff in the middle of the day and then do all your work at night. It doesn't always mean it's really a good idea. That worked. Okay. Sometimes when I was doing development work and I was a bit more working on my own. But if you're working with part of a team that can be really disruptive. So I wish that I had known at the beginning to start practicing giving myself some structure so that work time is for work and home time is for home. So kind of resisting that urge to get things done. You know on the, on the household front during the day. Now that so many household chores are online, you can do them in the office too. And so it's not that big of a difference. But you know, if I do decide like I've been at my desk too long, I have a break between meetings, I'm going to go, you know, go for a walk, go for a bike ride, vacuum the apartment, go do something else. Also having the discipline to make that time up later cause eventually it will catch up with you. Something else I would say I would have liked to know then is the idea of over communicating with everybody else at work, especially if you're new to it and if your team is new to it, it can take awhile to build up trust. Over-communicating helps people know where to find you, when to find you, how to find you, what you're doing. If you're busy, all the things that they could probably tell just by poking ahead and you know, at your desk or at your cubicle. But they can't do that now. So if someone reaches out to you and they don't hear back, they don't know. If you haven't set things up correctly, they don't know, you know, are you in a meeting? Are you going for a walk? Are you watching the Simpsons on your couch? You know, what's going on? Why can't I find Jordan? And those things can start to eat away at trust a little bit. So I'd say probably the thing that I would've liked to know also in addition to structuring my time is how to engage in those trust-building behaviors.  Adam: (05:00)So speaking of like trust-building behaviors, you know, there's probably a lot of team leaders who are suddenly the leaders of virtual teams. You know, can we keep talking on that? Where we'd like on keeping the culture and the teamwork alive, even though everybody's in different locations? Like, what advice would you give to them?  Jordan: (05:17)Oh, absolutely. The first thing I would say is if your team is moving to video calls, turn your cameras on. That's a really seemingly simple thing and it's also something that people get really uncomfortable with. We don't mind sitting at a table, you know, in a conference room full of our coworkers where everybody can see us. But turning on a camera feels like a really different step. There's definitely a mental barrier there to being on camera that people just aren't used to. When you turn your cameras on, it humanizes you for everybody and it humanizes everybody else on the call too so that you can all still look each other in the eyes, quote unquote. It's not exactly the same, but at least you are able to see each other and that goes a long way towards kind of remembering that like we're all together, we're all at work, we're all on the same team. These are the people I work with every day. I'd say also to make sure that you're making time for your culture. It's something now that you're going to have to schedule culture used to be able to happen, you know, in the break room and the kitchen stopping by someone's desk to say hi, just seeing someone in the hallway on the way to the bathroom and having that, that little conversation, those moments are going to be gone for awhile. So there's some things that I'd like to recommend, some things I think you can do to kind of build that stuff in, but the point behind all of them is just getting a little more intentional about designing these cultural moments. I mean there's some things you can do, like have a, have a running zoom or running Google hangout that's just always on that people kind of join or leave as needed. Call it the break room. It's going to feel really weird at first. It's okay to acknowledge that, but just to give people a place where they can sort of stop in and see each other outside of actual work outside of a meeting. If your team used to do happy hours after work host and at home happy hour, right? Let everybody, you know, okay, it's five o'clock everybody grab a beverage of your choice, everybody hop on the zoom link and we're all just going to toast each other and talk and hang out for a little while after work and nobody has to go anywhere. These things take a little more planning. They definitely take some getting used to, but I think they go a long way towards keeping that cultural hive. Something else I'd like to do is I do this with people and I encourage people on my team to schedule one on one time with other people even if it's not for a work thing. All right. I have some standing meetings every week where I meet with someone for a half hour every week or every other week mostly just to catch up. Work stuff comes up, but it's not people that I necessarily work directly with on projects. Some of them are people I used to manage or who used to manage me or just friends at work that I want to say hi to and I'm not really going to get another chance to do it. So things like that I think can be really valuable in terms of keeping that culture alive.  Adam: (08:00)You know, I think that's some great advice. Just yesterday I had realized I hadn't really spoken with one of my colleagues. And so I said, Hey, let's do a video call. And we just spoke for 15 minutes and we ended up not really talking about work, but it was great to have that connection point. So, since, you know, we're all working from home now and it's going to be longer than we expected and it's like, what are we supposed to do? And doing that touch point was like, Oh, I now feel connected to you again.  Jordan: (08:25)Yeah, absolutely. And keeping that sense of connection alive I think is really valuable, especially as people are adjusting to this time because otherwise it's pretty easy to feel isolated or sort of overwhelmed with things on the home front. And you know, in a normal work meeting we don't necessarily have time to talk about that stuff. So building in time to sort of acknowledge what's going on and to talk about how weird things feel at first and talk about how we're all getting used to this and just to kind of keep those human connections going I think is valuable, not just for culture and just kind of for your own sanity too.  Adam: (08:58)Definitely. So you've mentioned zoom, so what are some of your Go-To technologies and tools that you use every day?  Jordan: (09:05)I love zoom. We're on a zoom right now, a little peek behind the curtain. At our company at phase two, we are a digital experience agency. We are, we use the Google suite. So everyday I spend most of my day in either a Google meet, which was formerly known as Google Hangouts. We use Google docs for collaboration and we use Slack. We also spend a lot of time in a tool called mural, which is an online whiteboard, which is really good. I've found for online meetings, for giving people a place to kind of post. It's basically think of it as a place where you can just post up sticky notes together at its most simplistic. It can do a lot more than that, but it's really good to have a tool like that for those moments when you wish you could just get up and like go to the whiteboard and you know, this conversation, we're not really getting there with words. Let's, let's draw something together. Let's go up to the whiteboard and see if we can figure this out with some sticky notes and move some things around. So those were, that's primarily the tech stack that we use. So of course Gmail as well. Good old email hasn't gone anywhere. It's probably more valuable now than it used to be. Personally I find having two monitors on my desk is a really big help. I often will keep my video call on one monitor, my notes doc and the other one I know not everybody has that. It's really challenging to do some of this stuff from a small laptop screen, especially when your whole screen now is taken up by that video call, but it's worth the time to be able to see each other. It's worth the screen real estate I'd say to keep that video call open. You know, even if you shrink it down to half size just so you can see other people's faces. Having a headset is also a really, really big help. I have a nice one with a little built in microphone. A good over the ear sound so the sound doesn't leak out. Usually does a decent job filtering out background noise, which is nice, especially if you find that your whole family is now home to along with you, which is probably a new thing for some people. I would say on the topic of Slack, Slack can take some getting used to if your team isn't already used to it. Probably the most important thing to do beyond having a conversation with your team about here's how we're going to use this tool is learning to manage your notifications and your statuses. Setting your status in something like Slack can be really valuable. Again, in terms of that sort of over-communicating and the building trust we were talking about in terms of letting people know like, Hey, this is a time what I'm going to be able to respond quickly to something or I'm gonna, I'm recording a podcast right now and I won't be able to talk to you. You're not going to hear back from me immediately. Otherwise without, without those statuses, you can send a message to someone and then you just sort of sitting there waiting and if you're used to just being able to like pop your head into their office or stop by their cubicle and ask them something. This is sort of the equivalent of like, well I left a note on your desk but I never heard back what happened. Are you there know? Whereas a setting your status lets people know like, Hey, I'm actually not at my desk right now. Right. This is, you know, or I'm in another meeting and I'm trying to give that my attention. So that's, that's one of those sort of trust-building behaviors. I think that could be really valuable as you get used to work more remotely beyond that. My favorite tools are a my water bottle on my coffee cup to get me through the day.  Adam: (12:18)Definitely. So I wanted to go back a little bit and you, you kept mentioning that you learning to apply some structure to your day. So what does that structure look like for somebody who is like just getting started? Like I don't know, what did you say? Structure. What do you mean by structure? What does that mean?  Jordan: (12:35)Probably the simplest form of structure is just to say at these hours I'm at work and at these hours I'm not at work. Now it's not probably going to be as simple as, well, I'm at work from nine to five and then I'm not at work for nine to five. I mean it hasn't been that simple for a lot of people. You know, I think for awhile, but if you're used to being at an office during those hours and now you've got your kids around and your family is around and there's a lot of craziness going on, you might need to figure out, okay, so like for example, my wife and I sat down and we said, okay, our daughter is going to school online now, but she's only seven. Someone still needs to sit with her and make sure that the zoom is working and make sure that she can log in to this and that. So my wife is with her from eight to one. I'm typically with her then from one to five. And so I've had to talk to my boss and my coworkers about like, Hey, from one to five I'm going to set my Slack status. I'm going to be, I might see your message, I might not be able to respond to you until afterwards. If it's urgent, here's that escalate, you know, text me, call me, here's, here's sort of escalation procedures. But then I know also then from like five to seven I'm going to sit down with my laptop and respond to emails, respond to those Slack messages that came in. So it's going to be, it's going to look different for everybody, but the, the idea of the structure I think is important so that you're not just sort of figuring it out moment to moment cause otherwise everything can start to feel like a little bit of a crisis, you know like Oh no I'm on a call and my wife's also on a call and the zoom link isn't working for the, you know, for my daughter to go to school and suddenly everybody is like, everybody's going crazy. But it's taking the time to sort of sit down and divvy up the day together has so far been paying off really, really well. So at least we know who was the first person to respond if something happens on the home front, if that makes sense.  Adam: (14:19)No, definitely. I think that's some good advice. Is planning ahead seems to be a good thing. Even when it comes down to things like meals or just when am I going to do some little bit of exercise or going for a walk is planning those things out cause it's not, it's so similar to being at home.  Jordan: (14:35)What am I going to eat lunch? You know, this is actually a real question I had to ask myself the other day.  Adam: (14:41)So you know, in light of everything that's been happening, I think we've given some great examples to people, you know, I just, you know, forward thinking. What do you think the future of working from home will look like post this pandemic crisis I should say?  Jordan: (14:53)That's a great question. I like the optimism. I hope there is a post this pandemic crisis. I'm sure there will be. My real hope is that a lot of organizations will get a little bit looser with their working from home policies. It's, it's sort of shocking to me. Even the, you know, and in March of 2020 how many places still have never really had a work from home policy other than to say, no, you can't do it. So my hope is that a lot of places get a little more relaxed about that. There, there are security concerns. I know for some places and there are also plenty of tools and pieces of security software, you know, VPNs, et cetera, that can really help with that stuff. So I don't think that's the barrier that it used to be. I hope that people in general, so we'll get a little more used to being on a camera. I always come back to the camera cause for me when you when you have these video calls and you don't have your camera on and nobody has their cameras on, I feel like you really lose a lot of that interpersonal connection and you, it's easy to get a little bit untethered, I think from your work reality. So I hope that more people will feel comfortable turning their camera on and just kind of getting used to operating in that sort of online conferencing space because it really opens you up for a lot of things, not just for working from home, but also something else we do at my company is we do a monthly, a horror movie night for those of us who are big fans of horror movies. Yeah. We started a horror movie Slack channel a while back and it's grown into this thing where, you know, anywhere from three to 10 of us will hop onto a call and this is people across multiple time zones all across the US we'll get together and we'll watch a movie together and we'll have our cameras on and we'll be able to talk to each other and talk over it and, you know, share a drink, share a laugh. And we're able to do that so easily because we're already used to using all these tools and used to being on camera from our work day. So I feel like it opens up a lot of possibilities that maybe weren't open to people before that people didn't realize were available to them. I'm sure some people will definitely miss an OS in a office environment. That's okay. I hope they're happy going back to the office. I haven't been an office person for a while now. So for me, when I go into the office, I've got to have the opposite problem of how everyone is right now. I'm like, Oh, how do I focus with all these people around it so different. But I think that there will be people who earned that they really like working from home and that with a little bit of effort, they can actually really make it work and get a lot of value out of it. So that's my hope for the future.  Adam: (17:17)Definitely. Ihope that too. And Jordan, I really appreciate you coming on today and just sharing your insights and your experiences. It was, it was really great chatting.  Jordan: (17:25)Adam thank you so much for having me. This was a great conversation.  Announcer: (17:30)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Alessia's Suggested Resources: PwC’s 2019 Annual Corporate Directors Survey: https://www.pwc.com/us/en/services/governance-insights-center/library/annual-corporate-directors-survey.html  SASB’s Materiality Map: https://materiality.sasb.org/  EY, What investors expect from the 2020 proxy season: https://www.ey.com/en_us/board-matters/what-investors-expect-from-the-2020-proxy-season  Alliance for Corporate Transparency 2019 Report: Analysis of Sustainability Reports of 1,000 Companies Pursuant to the EU Non-Financial Reporting Directive: https://www.allianceforcorporatetransparency.org/assets/2019_Research_Report%20_Alliance_for_Corporate_Transparency-7d9802a0c18c9f13017d686481bd2d6c6886fea6d9e9c7a5c3cfafea8a48b1c7.pdf  SASB Integration Insights, Building TCFD-Ready Portfolios with SASB’s Standards, September 2019: https://www.sasb.org/wp-content/uploads/2019/10/ESG-Integration-Insights-Pinebridge-092719.pdf  FULL EPISODE TRANSCRIPT: Adam: (00:00)You are now listening to episode 55 of Count Me In, IMA's podcast about all things affecting the accounting and finance world. I am your host, Adam Larson and I'll be bringing you right up to the conversation between my cohost Mitch and Alessia Falsarone. Alessia joined Count Me In to talk about how and why 2020 is the year of ESG data. She is the head of sustainable investing for portfolio management for PineBridge Investments and has a wealth of knowledge in the area of sustainability and integrated reporting. Let's head over to the main part of our episode now and hear Alessia share her valuable perspectives on ESG data. Mitch: (00:43)What are some typical line items or key data points relating to ESG and sustainability that accountants should really be reporting on?  Alessia: (00:57)Well, first of all, thank you Mitch for inviting me to share the investor lens with your audience at the IMA today.  2020 is truly the year of data for ESG. The entire field, not only investors, I am referring to- but also corporate finance specialists, controllers, treasurers, CFOs and auditors are taking a much closer look at what is generated across their organization as relates to sustainability efforts of the enterprise and starting to take stock of any linkages  between sustainability credentials that a company may list for customer outreach and end-market awareness in their reports and their website vs. the financially material sustainability factors that affect the profitability of their business. And that is an area where either accountants or treasurers or CFOs are spending in my opinion, as it is the case for the companies I engage with as an investor, a lot more time, since they're really looking at them not only as an engagement tool, but as an alignment with their financial commitments. So where sustainability is adding value in reporting is at the intersection of enterprise value, operating efficiency and top line growth. What's interesting about that is, when we think about corporate governance, and go back to corporate directors surveys for last year, for example, I think it was The PwC’s annual corporate directors survey that found more than half of directors say investors are giving too much time and focus to ESG – environmental and social governance considerations – which is nearly twice the percentage in 2018. What is it eye brow lifting for me as an investor when thinking about the accounting side of the business? Clearly there is the need for continued dialogue- if the board does not recognized the value, nor its audit committee, then investors can continue to debate the divestment saga or not but we will see little value in corporate reporting initiatives. So when you compare that survey to the engagement priorities for institutional investors during the 2020 proxy season remains environmental resilience and also the ability of the board to address resilience and capital planning considerations is clear. My lens remains bias as I am both a capital markets professional and a certified director with NACD – the National Association of Corporate Directors - in the US and a governance fellow for a number of years. I can assure you that at NACD there has been a strong push to elevate directors’ skills – certainly those sitting in audit committees – to see the relevant disruptions. This is something I would like to make clear to the audience at the IMA. ESG is certainly a tangible one on a clock – it carries reputational risk that no sustainability credentialing process could make up for if lost. Few enlightened board chairs or audit committee members see that and they are certainly keeping the accounting for ESG data up the priority list.  Mitch: (04:21)So that's really interesting. And you know, from this investor perspective here, you know, aside from the time and the priority that goes into it, I'm sure there are a number of other challenges as well that, you know, accountants particularly must be aware of. So from your perspective, what are some of these challenges that accountants face with this ESG data when it comes to giving investors the information that they're really looking for?  Alessia: (04:45)It’s quite interesting. When I think about financial innovation and the headlines surrounding the issuance of sustainability-linked financial instruments such as traditional green bonds, loans or even transition-linked capital raising instruments, they have certainly raised awareness as the treasury team at a company and the CFO is as involved as the auditors and the external verifiers in aligning capital raised with capex associated with a company’s green effort. That’s one part of it. Certainly, from an accounting perspective, the need for ESG data is to be aligned with the financial commitments of a firm as data is about long terms trends that will require as much opex as capex to build resilience or competitive advantage and top line growth. Either way, ESG data and the impact on $-Unit measures are the hardest to address as non-financial risks and non-traditional sources of risk don’t come in same unit measure. Clearly you have accounting and finance professionals testing themselves on kilowatt-hours when aggregating energy efficiency to metric tons of CO2 per home yearly when discussing home energy use, or even more esoteric such as “near misses” which is the count of events with the potential of loss or injury if the accountant is analyzing health and safety statistics within the workforce. Who’s domain is that? It is increasingly of financial professionals. While there is certainly room to define best practices, it is simply good business management to define E-S-G indicators at the company level that are associated with financial outcomes and address them and report them consistently – they could be in the form of trends or as statics, absolute levels if there are absolute (sustainability) targets in place.I will give you an example- a new green cement laboratory finding in Colombia recently, which calls for the relevance of adopting green techniques in the production of cement. Yet production itself is clearly an energy intensive process. So while the green aspect of bringing to market a more sustainable product in terms of carbon released in the atmosphere during production may indeed be part of an environmental materiality approach and disclosure that can be externally verified – with clear financial consequences associated with potential carbon levies on that economic activity in the future – yet the financially relevant aspects to be accounted for are associated with another set of questions: First, business materiality would call for near-term financing of that transition from legacy cement production to newer products, including timing of operating expenses and capex associated with it. And then you have potential forecast of market share gains and therefore more stable pickup in free cash flows including the impact on credit metrics. Unless we place the financial materiality of the innovation in the context of how sizeable is the opportunity, the financial benefit associated with greening products may not be fully captured in enterprise value and therefore there may be no additional incentives for a management team to carry out a full upgrade of their product offerings any time soon.The accounting world has the remarkable opportunity to pick up on innovations like the one I have just mentioned and articulate that in terms of financial outcome, with a reporting time horizon in mind.Moving from sustainability credentials, awards and recognition into a set of variables that are really part of an investor day -type of dialogue is key. Certainly, the underwriting of green bonds and loans and the advances in capital markets addressing the quality of project financing with green aspirations has made corporate commitments even more visible globally. Definitely in need for properly accounted metrics and corporate governance practices that are both internally and externally verifiable and assurable (if not assured yet). In a world where boilerplate language is still the norm, it will not be surprising then to our audience today to hear that in the face of boilerplate language and the lack of faster adoption of standards such as SASB’s, investors do in fact apply their own independent research and opinions to their investee companies – and they are already bridging the gap between sustainability accounting and financial decisions when looking at reporting package of a company.  Mitch: (10:27)So you just touched on a couple of things that I want to circle back to and make sure we address. I know you were talking about financial and outcomes and making sure that, you know, the traditional external financial reporting, for accountants we always rely on verification and, consistent units of measure. So how does this ESG data really translate and really what's the difference between integrated reporting with all these challenges compared to the traditional financial reporting that most accountants are familiar with?  Alessia: (10:56)Yeah, it's interesting, right? The value of integrated reporting is more tangible than ever when dealing with sustainability factors that affect a business in ways that are certainly not unidimensional. What I mean by that is, going back to the different unit measures and the continued need for comparability, the value of having a solid corporate reporting that incorporates the governance of environmental and social factors in management discussion and analysis as well as now entering the foundations of financial commentaries as well when material, that value is now more than ever at risk of miscommunication or lack of targeted communication surrounding financially relevant issues of strategic value to an organization.  Yet, probably the largest study released that I know of zooms in on how 1000+ companies in Europe disclose information on their environmental and societal risks and impacts- The EU has been at the forefront of regulatory awareness and action surrounding standards and reporting initiatives. The study is fresh of the press – released yesterday, on President’s Day February 17th by the Alliance for Corporate Transparency. Briefly, results show that a majority of companies are focused on policies and procedures and commitments with respect to non-financial risks such as sustainability, but approx. 22% so less than 1-in-4 report on them and define performance indicators that are verifiable. And 13% or so define business exposures to polluting sectors. If we delve into issues related to the workforce, the statistics are even more alarming. 80-83%% describe their human rights policies, 25% disclose the actual risks related to Human Capital and less than 15% report actual impacts on the business. If we go back to the same EY report on investor engagement priorities for 2020, Human Capital retains top 2 positions along with environmental concerns as a key strategic success in the next 3-5 year time horizon including issues of workforce diversity and culture in the workplace. Yet traditionally investors have focused on workforce compensation in their analysis as in many cases that is clearly connected to pay equity and promotion rates across diversity categories. Clearly, it is not a one-size fit all approach – if anything it is highly dependent on the end-markets in which a company operates and reporting should clearly be aligned with the need for more accurate statistics. I encourage the audience to follow the research project on Human Capital that the Sustainability Accounting Standards Board (SASB) has launched in the 4th quarter of 2019. It clearly addresses the need for a deeper exploration of dimensions such as human well-being in the workplace, the impact of technology and innovation in upskilling as well as capturing the impact of D&I in terms of its financial materiality. So if you ask me where do I see the value of integrated reporting going forward is as a communication toolkit that is very much lacking and much needed to define management discussion and analysis, financial reporting and management oversight of financially material sustainability risks. As an investor I see strong value in the work of SASB and clearly that is in my toolkit and certainly it is under the SASB guidance that increasingly investment analyses are performed - pre- and post- due diligence – for both public and private entities. Mitch: (15:13)And I think that's all great and thank you for clarifying all that information. you did just recently mentioned something about technology and upskilling though. So I would like to get your opinion on what you have seen in the market as far as how technology has impacted this integrated reporting and what does that really mean for the accurate data that investors are really looking for when it comes to integrated reporting or financial reporting in general? Alessia: (15:54)That's a really key point. Clearly we need to recognize that technology has affected the entire financial services and business management industries for the past 2 decades. Going forward I see technological innovation adding in 2 key ways: 1 through enhanced verification and assurance and the other directly in incorporating non-traditional source of sustainability oriented data feeds into financial analysis. With respect to the 1st application, the enhanced verification and assurance, clearly the vast number of data points with consistent history and verifiable sources of information that are available today has created the best backdrop and a strong tailwind to harness use cases of alternative data and other non-traditionally collected nor accounted for data series that in aggregate enable decision-useful content in the reporting of outcomes. An example that comes to mind is the emerging use of geospatial data or earth observation through remote sensing technology for the analysis, for example, of environmental risks in supply chains, it is clear to me that such applications will become core in financial reporting related for example to enterprise risk management and scenario planning under the TCFD reporting.The 2nd leverage point of technology innovation in accounting and reporting applications, so to speak the translation of non-financial data into financial metrics, the real need is to ensure that whatever vendor is selected or in-house built platform is rolled out, it is conducted from a place that truly looks at the ultimate use of data as monetary liabilities associated with the mismanagement of the info collected, and how much that info has a verifiable process to derive financially material decisions for a business as it may also be subject to cyber and broader reputational risks even if it comes in non-financial unit measures and may look harmless. If we think of medical records and privacy it is easier to see the case for heightened vendor management practices surrounding the use of technology. Anecdotal evidence: I have heard in between 700-800 data fields are available regarding ESG practices of an organization. Without accounting for the severity of impact, or the likelihood and other measures to address validation of the ultimate source of that data point, that may result in non-financially material information. The role of Big 4s in building not just reporting but also growing the existing advisory into sustainable services for management teams speaks to the need for well-rounded due diligence. An area where technology will become increasingly relevant is the 3rd party verification of impact – which is yet to be addressed and likely a crucial aspect in a world where companies set bold climate-science aligned targets for carbon emissions and start discussing variables such as scope 3 emissions which are not measurable as part of operational framework but go outside of the company (the use phase) and follow the products or services once they leave the showroom or the shelf, so to speak.I am a big proponent of blockchain solutions. I have heard the digital ledger defined for a long time as “the hammer looking for nails”. Sustainability as the perfect nail for blockchain and digital ledger technologies.If there is one thing I would leave the IMA audience with today is the following question. Ask yourself whether XYZ (identify the most pressing ESG issue that your company is facing) and whether in house there exist a collection point where that data can be streamed, which processes it currently informed, who can verify its validity and take charge of its integrity and how many times that data point has been presented to the management team or to the audit committee of the board. If you start with that you will be already on your sustainability reporting journey.Announcer: (20:26)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Efrain Rivera: https://www.paychex.com/newsroom/executive-bios/efrain-rivera https://www.linkedin.com/in/efrain-rivera-75b4b15/ FULL EPISODE TRANSCRIPTMitch: (00:00)Welcome back to Count Me In. I'm your host Mitch Roshong and I will be bringing you episode 54 of IMA's podcast. Today's expert guests is CFO and treasurer of Paychex. Efrain Rivera. He joined my cohost, Adam to explain how technology trends have impacted paychecks and the services they provide for their clients. He also talks about how clients expectations of their services have changed. Listen and now to hear how this executive of a highly reputable outsourcing firm has realized the changes in our accounting and finance world.  Adam: (00:35)So Paychex is a provider of human resource, payroll and benefits outsourcing services. And so with the broad scope of traditional services, how have technology trends impacted the job you and your team are required to do?  Efrain: (00:54)Yeah, I think it's impacted it in two ways. So the first is with respect to the platform itself that we use to deliver those services. And then I think the second which we'll talk about is the way those services are actually delivered. So first, let me talk about, the technology of the platform itself. I'd say starting about nine, 10 years ago, you saw an evolution of service providers, moving to the cloud, on platforms that were multitenant and SAS, meaning, you moved away from on premise software, we moved into the cloud and your systems were available to all of the participants, in that were using the product all at once. And you had to have a robust system that was capable of addressing the needs of all of those, those clients. What that meant was, you needed to be able to deliver updates to that platform seamlessly across all of your client base and you needed to do that in real times. So, your systems had to become more, high availability and, they, they needed to, participate or be available for frequent updating instead of an update that occurred maybe once or twice a year or three times a year. If you were doing it more frequently, you now have the evolution of systems which frequently were updated on weekly and monthly bases based on, the needs of both users. And requirements of the system. When you put that all together, it put a lot more demand, on the technology. and it fundamentally impacted the way, the technology was delivered and now what was a trend 10 years ago has become the dominant way in which technology is delivered, particularly in the human capital management space, which is what we talk about when we talk about HR, payroll and benefits. So it's changed very dramatically over that period of time and impacted the way that we do our job and the way that we make investments to sustain that platform. That's the first part of the, equation. The second part is more recent and that's how the services that, technology enabled service providers deliver have changed and those services have changed because what used to be primarily a service provider function has now shifted to become a mix of both technology and service provider. What I mean by that is this many things that in the past, could only have been done directly with a phone contact or chat contact with a service provider, an actual service provider can now be done through technology itself. So, for example, the use of technologies such as intelligent chat bots, artificial intelligence, robotic process automation, all of these things have revolutionized the way service is delivered. So while we used to think about this clear divide between technology and service delivery, those lines became blurred. And what used to be a service is now increasingly delivered through technology. In our case, we have, intelligent chatbots that, that can answer many, many questions that clients, pose. And our systems are becoming more and more intelligent so that when we see that a customer is lingering in one part of the, application, chat, a chat window will pop up, giving them some indication around what to do next. So systems are becoming more intelligent, service is becoming more blurred with technology, and all of that puts a premium on making the right kinds of investments in technology. So that, the customer can get the service that, that they want and deserve.  Adam: (05:54)So you just mentioned a lot of different software applications, the, the evolution of all those and there's also the evolution of cloud accounting technology, which all those things have to talk together. Do you, what found, what challenges do you face in providing those services?  Efrain: (06:11)So I would say with respect to the evolution of cloud accounting services, um, that's not an area that, that we provide, but a cloud accounting services interface with the technology that we do provide. And so for us, the biggest challenge there is, or one of the bigger challenges is to ensure that our systems and our software, particularly our, our software interface seamlessly with the kinds of accounting software that major providers, delivered, to customers. So there's a number of packages that, that are prevalent in the marketplace. There's one dominant package. And, for us as we design our systems, particularly on the payroll side, but in other areas too, on, on, human resources administration and also in our time and attendance systems, our time tracking systems, they need to seamlessly integrate with those, accounting packages so that the information that's being, captured in the system is transmitted, into the accounting systems and the correct information flows both ways and increasingly if not just good enough to do it, on some sort of file transfer basis. Increasingly what's going on is that that information is exchanged real time or, or we're being asked to exchange that information real time, with third party vendors. And so configuring our systems to be able to do that becomes an important challenge. and, one of the, one of the things that, that our it group, works on.  Adam: (08:02)How have you handled a security, with those systems talking together in real time now?  Efrain: (08:08)Yeah, security, I would say in the last decade, the amount of, the amount of investment that we have made in security has increased significantly. There's a couple of reasons for that. One is because we transmit so much, money, we have to ensure that the perimeter of our, our systems is hardened, to prevent intrusion. So we're constantly on the lookout for that. But the second point, which you just mentioned is we also need to be, um, we also need to look at how our systems interface with other, other providers to ensure that there are no vulnerabilities when information is exchanged. And so we have made a lot of investments and things like encryption of information ensuring that, when there are handoffs, in information, there's no, there's no security issues around that. And also, um, we have made significant investments in monitoring activity in and out of our systems to ensure that, data is protected and there intrusions are not minimized, but basically prevented. so we, we spent a lot of time, thinking about that and working on that and investing to make sure that those issues will not occur.  Adam: (09:44)Now, I'm sure your client base spans a variety of industries and markets. So how have their expectations changed over the years as far as your services you provide and the detail or accuracy that they require?  Efrain: (09:57)Yeah, that's a good question. I would say there's been a significant change and what customers require. I think that in the past customers were very willing, I would say going back 10 years or so, very willing to, sit back and, and let the provider, be the one driving the activity. And they were content with, interacting with their provider in that way. Their service provider, I think now it's very different. I think increasingly customers want to do much of the work themselves, at least the important parts that they value. And so you need to work in a cooperative environment, with customers and provide a complete self service functionality. We provide a functionality that spans all the way from doing it for the customer to having it all, uh, having the customer do it by themselves. But the thing that ties all of that together, whether you do it yourself or you have someone else do it for you, is that whatever process you use has to be transparent and intuitive to the customer. And what is required now is simplicity, and also insight into the business that, that customers are running. So there's a increased need for simplicity and transparency in the information that you provide to customers. And if you can't provide it to them, customers get frustrated and will go elsewhere.  Adam: (11:41)That makes sense. You've got to provide that value that they need so that they want to keep coming back.  Efrain: (11:46)Yeah, that's correct. And, in our systems, for example, we provide a lot of analytics, to customers they can look at, at and see on our platform how some of their characteristics and some of their data, compares to other people in our client base. And increasingly, customers value that information because they want to get a sense of how they're doing, as against the market as a whole.  Adam: (12:19)Yeah. You know it's great to providing data analytics is huge as we, we understand the importance of data analytics and data visualization. How do you, how does data analytics and data visualization come into your role as CFO at Paychex?  Efrain: (12:32)Yeah, so, you know, I think that there's a lot of discussion about, data analytics and visualization. I think you've got to start first with understanding what you're looking at the right data. and I think that, all of us deal with a blizzard of information every day, but separating what's important from what's not, important is, is critical. I look at a lot of data, and I think that when, when you can clearly visualize the information that, that you're looking at, and you can clearly link that information to business outcomes, then you can make good decisions around what the implications that data are for the business. I think that's the toughest thing. The analytics are one part, but understanding how those analytics impact your business and, what decisions, need to be made based on that data. That's, that's more complicated. So I would say data analytics provides an entryway to good decision making, but you still have to use judgment and you still have to, parse what you're looking at to understand how it impacts the business and that that requires some intuition and judgment, that you gained through, through experience.  Adam: (14:01)So you mentioned that you're able to offer a more self service type function, and people are able to analyze their own things. Are there any other services you've been able to offer are added benefits, because of things like data analytics or other technology trends you've been able to offer to your clients?  Efrain: (14:19)Yeah, I would say that the combination of the products that we, that we offer, on the HR administration side in particular, which is an area that we have been, emphasizing in recent years. The ability to look at that data, is very helpful to customers, who are struggling, especially small and medium size enterprises who are struggling, with building out their talent and recruiting talent. And so much of the information that we provide the clients helps them in terms of the management of their business. And we also have value added services on the HR consulting side that build off of that data that we provide that help, help clients manage their talent, which is one of the biggest issues that clients say they wrestle with. As our systems have become better as our data has provided more insight to customers, they're better able to manage the talent that they have in an environment where unemployment is very low and the competition for talent is very high.  Adam: (15:47)So how much has the finance function evolved for you as a CFO where you are?  Efrain: (15:53)Yeah, I would say, you know, you go back now, I've been here now nine years and I've been a CFO longer than that. I would say in the past more time was spent compiling and searching for data. I would say the trend has been, away from compiling and reporting, data to analysis of data. So I would say it might have in the past been more, a third to two thirds in terms of the split between analysis and compiling data. now I think it's much more a quarter of our time is spent, compiling data, assembling data and, 50 to 75% of the time is doing analysis of the data to drive business insights. And I would say that one of the things that's very, very important in terms of the finance function here at Paychex is that we partner with business units to drive a solid decision making. If you start with good data and you start with good insights, you can draw a good conclusions. And that's something that we emphasize, very, very, heavily here. in order to be able to be an effective business partner, you need to be able to, sit with the business units and, help them understand the data and understand what the implications of the data are to the management of the business. And I think that that's where, finance professionals really, add value in their work.  Adam: (17:45)Well Efrain I really appreciate you taking the time out of your busy to come on and chat with us here on, Count Me In. I really appreciate you coming on today.  Efrain: (17:54)Well, thank you very much. Appreciate it. Take care.  Announcer: (17:59)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Rachel: https://www.linkedin.com/in/rachelbdruckenmiller/UNMUTED: www.UnmutedLife.com FULL EPISODE TRANSCRIPTAdam: (00:00)Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I am your host, Adam Larson, and this is episode 53 of our series. Our featured expert guests who joined Mitch for this conversation is Rachel Druckenmiller the founder and CEO of un-muted Rachel is a keynote speaker who uses her compelling speaking engagements and live workshops to energize and engage workforces. And her discussion with Mitch, Rachel talks about self care, self leadership and explains how individuals can manage expectations of others to meet the expectations and personal goals of their own. Keep listening to hear more about this valuable leadership topic.  Mitch: (00:43)So as we started talking about this conversation, we really said we wanted to focus on what we're calling self-care and self leadership. So the first thing that came to my mind was, you know, how do we effectively assess expectations? And I'm just wondering if you can kind of share your thoughts on, you know, how do we assess our own expectations against what other people are looking from us?  Rachel: (01:13)Yeah. There's a, there's a book written by a woman named Bronnie ware called The Top. It sounds kind of morbid. It's called The Top Five Regrets of the Dying. And I share these with people when I speak at different events and conferences, but the number one is tied to tied to expectations, the number one and regret that people say that I wish I'd had the courage to live a life true to myself and not the life others expected of me. So I think expectations come in two forms, I think in one form for us to be honest about what it is we want out of our lives and being intentional about designing a life that we want. Because otherwise, if we're not calling the shots, other people will be happy to kind of tell us what they need out of us and, and, and basically design our lives for us. But when it comes to a professional setting, I think a lot of times we have, we make assumptions about what people expect of us because we see how the people before us have handled themselves professionally. And so if they've just driven themselves into the ground, we assume that we have to and we don't necessarily, you know, get curious and ask questions about what is truly expected and from other people and what are the expectations that perhaps are not justified that we're putting on ourselves.  Mitch: (02:35)That's great. And how do we go about prioritizing this though? You know, you always want to put your priorities, your goals first. You know, that's kind of the message and being intentional. But um, once you get to know what other people expect of you know, how do you go about reaching their needs to a point where you're still successful?  Rachel: (02:55)I mean, for part of it I feel like is you know a matter of really being really being honest about you know what you need from people. I think a lot of times we're afraid to ask for what we need. We're afraid to ask for support. We're afraid to ask for clarification. We're afraid to ask people questions about things cause we don't want them to see us as incompetent or an inadequate in some way. And so part of that I think is around making sure that we have the courage to be vulnerable and to be honest about, you know, what we need. But then I think, you know, another side of this is that, um, we have to, we're working for a business, you know, and so it's important for us to be clear with whoever we're working with that, you know, what are you, what are you expecting of me? So that I can measure my own success. Cause there's, there's a, there's a book called the truth about Employee Engagement. And one of the things that he talks about is that a measurement is one of the key factors that leads to job misery. So basically not being able to gauge our own success and progress. So I think you know, as employees, as leaders, one of the things that we can do to really make people feel, you know, a sense of engagement at work, and this is also tied to expectations, is to really be clear on how they can measure their own success. And so if we don't know how to do that, if it's not clear to us, we need to be willing to ask those questions and get that clarity.  Mitch: (04:23)That's a great point. And I actually just looked over, I have that book on my bookshelf right next to me in my office. So that's a great reference. Yeah. I guess, you know, the next question, maybe flipping the perspective here a little bit, but you know, we're talking about someone else's expectations of us. How about those who aspire to be leaders, you know, particularly our listeners, they look to be CFO's, business partners leading in the accounting and finance world. When you are the leader, how do you really, you know, not just develop your own personal leadership style but you know, consider the expectations of somebody else and make sure that you, uh, you know, work with them also from the other side of it.  Rachel: (05:05)You know, it's interesting, I think a lot of times, especially in very technical profession, so I've, I've often speaks to people that are in technical fields like, like finance, accounting, engineering, architecture and design, construction. So people that are in spaces that are generally very, very technical. And there's an assumption that in order to advance that we have to have the most technical knowledge, that if we're the most technically competent, that is going to be the thing that is going to help us advance and grow. And what I've come to learn through experience but also through a lot of research that's been coming out lately, is that there's this study done that looked at over 50,000 managers. And what they found is that warmth. So when we think of warmth, we think of approachability, accessibility, kindness, care, honesty, being present with people, that warmth was a greater predictor of leadership effectiveness than competence. And that surprises a lot of people because we assume that if we're just the most technically competent, that's going to get us ahead. And it's changing. So what's expected of leadership is, is changing and it's evolving and it's even been framed by Josh Berson, right? Futurist who has a lot of influence in terms of, you know, talking about leadership and the future of work. And, and he is reframing what we often call soft soft skills like these, you know, the skills related to emotional intelligence, Jensen communication and listening and kind of the behaviors associated with warmth. But he's reframing those and calling them power skills because those skills, if you can do those well they give you real power at work. They give you real influence at work. So I would encourage people to focus if you want to get to the top level of leadership to focus as much if not more on more of these these power skills like your agility people management ability to effectively, those are the things that are going to help elevate you. You still want to be competent. I mean we need people who are technically competent, but it's the combination of those two things that really sets people apart.  Mitch: (07:14)That's really interesting. And I like the kind of re categorization of that because you know, I haven't honestly, those are the things, especially in today's digital age that are often overlooked in my opinion and kind of what a lot of the studies that I read are saying, you know, it is the emotional intelligence and the communication that's most necessary to advance as we begin to work with different technologies in accounting and finance. So, um, I appreciate that perspective. I would like to kind of take a step back. You know, we were talking about expectations of ourselves, expectations of others and now these power skills, you know, what are some of your suggestions or do you have any perspective on how to really align all of this? Um, so that one can advance, one can succeed, but I know many times it comes with burnout, right? So how do we avoid that and make sure all of this is working properly for us?  Rachel: (08:10)Well, one of the things is keeping ourselves grounded and surrounded by people that know us really well, that can speak the truth with care. That can be there with us and make us feel valued even when we're not accomplishing anything. So I think a lot of times burnout is due to a state of disconnection. So we get to the point where we're so focused on getting ahead, we're so focused on proving ourselves. We're so focused on demonstrating that we're an expert and we know that we disconnect from these other aspects of our life that are important, like relationships, like these personal relationships like self care in the form of getting adequate sleep and making sure we're, you know, moving our bodies and doing things that we enjoy that don't necessarily involve numbing ourselves with alcohol or excessive Netflix for instance. So I think part of it is that we're often in a state of disconnection from our body sense of disconnection from people. It's that sense of disconnection from our deepest values. And then we further disconnect again by resorting to these things that keep us feeling a bit numb. And these are such common experiences. And so what I like to do is kind of wake people up to that, to that awareness that, Hey, you know, what is, is that really working? Is that really working for you? And what might you do instead to really take better care of yourself on a consistent basis by being in connection and community with other people on a consistent, you know, on a consistent way and by doing things like tending to sleep and, and having healthy forms of self care that don't necessarily involve, you know, checking out.  Mitch: (09:57)Well I think this conversation, you know, we kicked it off with self care and self-leadership and intentionally we indirectly kind of defined both of these, but I'm hoping you can kind of just give us, you know, your true definitions of self care, self leadership, and ultimately what are the benefits one can expect when they're able to implement this into their daily lives.  Rachel: (10:19)So self care is really kind of any activity that you're doing that supports your mental, physical, or emotional well-being. We have a tendency again, you know to put our needs was last, to put them the needs of other people, particularly women do this and men you, it to put our needs, the other people's needs above our own. And when we do that, we're just constantly, it's like these little sacrifices, at my friend Jeff Jernigan calls it these little like betrayals of purpose that happened over and over and over again. Like get us to the point where we don't even know what we want and we're not happy with where we end up. And so that, that self care piece, a lot of times it's framed as like, just take a bubble bath and do a face mask. And that is really a short term fix for an underlying issue, which may be again, rooted in this, having these things be consistent, not just these random one-offs. So sleep is perhaps one of the most important forms of self care because it affects everything else. So turning off your screens, there's a, there's actually a feature if you have an iPhone under the, uh, under your settings, under, under screening times. If you go to settings, go to screen time, there's a function called downtime and you can actually set your phone so that you can't access any of your apps for certain windows of time. So I have mine set to from 10:00 PM to 7:00 AM that I have to basically override the system to give myself access to those things. So that's an example of a healthy boundary I can set to be present and to prioritize sleep and then really making sure that I'm having social time at least once a week with a friend or a family member whose company and presence I enjoy. And doing that in person, or at least having an extended phone conversation, like really making that people part of our lives have priority because whether we're introverted or extroverted, we need community. And that's one of the healthiest ways we can foster self care is through community.And then I also use a device called a whoop fan. It's W H O O P and that really helps as an external gauge for me to understand dandy how well I'm sleeping, how recovered I am on a daily basis. And it's, it's kind of like, yeah, this, this external gauge that's, that's a check-in. Yeah. And an accountability device for me to make sure that if I'm not getting enough sleep that I'm, you know, I had that data to tell me I need to prioritize sleep that night for instance, or that I need to move my body more. So that's what I'd say when it, when it comes to self care. And then in terms of self-leadership, it's really developing this sense of self awareness of who we are and what we can do, where we're going and, and really having an awareness as of of how the way we're showing up as affecting other people. So the self-leadership is, I think it's, it's very lacking. It's one of the things that I focus on. It's one of the things I'm going to be talking about the conference in November because I think it really is leaders who are the most self aware of leaders then act on that self awareness and are willing and humble enough to grow and change based on that self awareness. I think those are the most effective leaders and that's where we're going to be heading in the future.  Mitch: (13:55)So I'm just wondering if you could maybe share an example or like a little case study. I know you do a lot of talks, you work with a lot of clients and you, you've been around a lot of people who have been able to implement this. So has anybody you know, come back to you and shared some success stories that maybe you could share with our listeners?  Rachel: (14:14)Yes. So I was doing a training at a global consulting firm for their managers and there were about 200 managers there and one of them. So I was talking about kind of, it starts with you and the focus on that self-leadership piece. And in the session, one of the questions I had asked that I, that I had gotten from my friend Simon Bailey, is who gets the best of you and who gets the rest of you. And one of the women who attended the training reached out to me like two days afterwards on LinkedIn and she said, I've already made a huge change in my life. No, I was like, this was two days ago. It was like a 50 minute session, you know, what the heck did you do? And she got back to me, she said, you know, I'm a single mom and traveling for work has really taken its toll on me and required me to be away from my family more than I was expecting because I split my time between two different regions of the country. And she said, when you asked that question, who gets the best of you and who gets the rest of you? It really hit me. And I went back home and I asked my partner that question and yeah. And after having that conversation the next day, she went to her boss and she asked for a change in her role so that she could be home more with their family and be rolled off of the travel project. And her boss agreed to it. And, she's still at the company and this is two, two and a half years later. And the thing that resonated the most with me that she said at the end of her message was: She said, after she had that conversation with her boss, she said, Rachel, I slept better that night than I have any year.  Announcer: (15:55)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Mike: https://www.linkedin.com/in/mikewallace/Mike's Recommended Resources: https://www.gmsustainability.com/gri.html  https://www.erm.com/ FULL EPISODE TRANSCRIPTMitch: (00:05)Thanks for coming back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is Mitch Roshong and I'll be bringing you to episode 52 of our series. My cohost Adam Larson, had a great conversation about various reporting expectations with Mike Wallace. Mike is partner at erm environmental resources management and is an internationally recognized expert in sustainability, ESG and human capital. He explains the recent changes since the global reporting initiative, measuring data for the expectations of different sectors and all things accounting and finance professionals should pay attention to regarding ESG. Keep listening to hear about how you can measure your company's reporting and performance with all the tools and resources available.  Adam: (00:55)So we first met, uh, almost a decade ago when you were working for the GRI or the global reporting initiative and a lot's happened since then. And can you let us know what changes you've seen most since then?  Mike: (01:08)Yeah, sure. The I mean I think, you know, the GRI is an interesting one where we met because the GRI itself is an entity but also the world's leading provider of our sustainability reporting framework, which has now become a standard. But that year I was created literally almost 20 years ago and was developed by a group of stakeholders that got together and said, you know, it's really fantastic what all these companies are doing about their environmental reporting and voluntary sustainability reporting, but they're not doing it in a very standardized manner. Let's create a framework by which companies can, how used to guide how they disclose this type of information. And that was the birth of the GRI literally 20 years ago. At about the same time a similar group of companies and stakeholders got together and they were talking about of all things greenhouse gas emissions disclosure and how those disclosures weren't consistent either. And that was the beginning of the greenhouse gas protocol. So today the GRI is the most widely used reporting framework out there. If you Google any company and and the word GRI after it, you're very likely to find it. The GRI report for the company so you know that they've done it according to a recognized global. My standard and the greenhouse gas protocol underlies all of the ways that we measure and manage and disclose carbon emissions today. So it feels like there's a sudden flood of all these things but it's actually been growing for the last, you know, 20 years or so. Probably the biggest things that have happened to the most significant changes that more and more people have grabbed onto the GRI's approach and enhanced it and tweaked it in ways to help focus it into certain areas or directions. For instance, the CDP is very focused on greenhouse gas disclosures and it's backed up by lot of investors who were saying, we want this type of information. There is, there are things that are specific to health and safety and how you treat your people or your human capital one in particular. It's called the workforce disclosure initiative and they've taken the ball and run with it around disclosures that companies should make about how they treat their people. And that can be gender and diversity issues or it could be right down to health and safety policy. And probably the biggest, most influential is, is the TCFD cause it's, it's the biggest one out there with the most players around it. And in essence the entire global market. The financial community, it's gotten together under this entity called the task force on climate related financial disclosures. Long name, but just think about it from the name of the standpoint of TCFD. You look up the signatories on that and you're going to see stock exchanges, the major rating agencies, insurance companies, lenders, asset management firms, commercial banks, private banks. And you'll see a lot of companies names on it and essence. They all got together and said to each other through this platform, the TCFD, we've got some issues here related to climate change risk and we all want to do business together. But it's in all of our best interest. If we figure out how we as individual companies and within our industries should measure, manage and report on the risks we face. I want to list, you says stock exchange, who's part of TCFD? But I want to know that you're going to be around for the future. I want to ensure you says insurance company, but I want to see your TCFD disclosures. I want to rate you says one of the ratings firms, but I want to see your TCFD disclosures and the companies are turning around and doing this because they want that finance financing. They want those business partners and they realize that these risks are true and real to their business. That's probably the biggest thing I've seen in the last decades, the TCFD emergence. But then this week we just last week we just had Davos and the world economic forum throughout all sorts of new news for us to digest. And yeah, it might feel overwhelming for companies, but it's actually pretty consistent with the pattern that we've been monitoring for the last 20 years.  Adam: (05:09)So thanks for those points, Mike. One of the things we noticed that um, black rock released their letter in January. You know, how was this shaking out in the marketplace?  Mike: (05:21)Yeah. It's interesting, Adam, because we've seen the letter come out for the last few years from Larry think and it's increasingly evolve to include more and more discussion about environmental, social and governance topics. And it's just put yourself in the driver's seat. There. World's largest asset manager. They have a lot of customers, asset owners like the big public pension funds and sovereign wealth funds as well as other institutions who say to black rock, we want to be responsible investors too. Can you make sure that you're managing our money in this way? So black rock and Larry Fink are responding to their customer demand and ramping up their ESG services offerings. They've got a growing team of engagement specialists. And third, is it this latest letter from Larry Fink, not only spells out why and what they're doing in their ESG area of work, they're talk about their own sustainability performance as an institution. And they own their own policies. They have a pretty big footprint, right? They fly people all over the world. They have data centers, they have a footprint themselves and they want to walk the talk. So that's in this letter, this time, hyperlinks to other things. There's an entire FAQ this year, so if you're a client or a customer or just a curious competitor, you can see how seriously black rock has taken this by looking at the FAQ and then to make the case for why they're doing it. They've got a letter that they've seen that right written in. It's in this document that explains how they're responding to their own clients. You asked for us to manage your money responsibly and with a view toward sustainability. Here's what we're doing. So they're pretty much showing us all the recipe for success, if you will. It does ping pong through companies. We've, you know, that letter comes out, we hear about it from our clients. The publicly traded clients are the ones that are being aimed at primarily what private equity companies do get the ripple effect from this as well. Why is that and how is that? Well, black rock also has private equity investments. There are many other private equity firms out there that are now starting to look at ESG issues as they work with there companies, their portfolio companies, and in the black rock case, as that pressure builds on the marketplace for the publicly traded companies, the publicly traded companies undoubtedly and almost always well look at their suppliers because the supply chain is a big part of a company's footprint. So while it feels like BlackRock's doing that only two publicly traded companies and putting the pressure there and actually ripples through the economy quite quickly, the other really important thing to take out of that is, you know, we talked about GRI in these various reporting frameworks over the years they've evolved. One of the ones that emerged in about 2010 was the sustainable accounting standards board. Yeah. Black Rock's a big supporter of this nonprofit initiative and this standards body and black rock spells it out very clearly in their letter. They also call out TCFD, which I mentioned earlier. So black is basically saying of these frameworks out in the world needs standards that are in the world. These are the two things we're paying close attention to. And you as a CEO receiving this letter from black rock, you might want to pay attention to these things too. And so that's certainly playing out in a really interesting way. And you know companies are are seeing this now from their biggest owner and they're saying I haven't got to finally do something.  Adam: (08:40)So then what should companies be paying attention to then?  Mike: (08:44)Well I think you know what it's easy approach to this is you need to realize that of somebody like a black rock doesn't just buy your stock because they just looked at you and your performance only they are looking to diversify their portfolio. That means they look sector by sector, you and all your peers and they don't just look at your view S peers or your Canadian peers. They look globally at all of the automotive sector or globally at all of the aviation sector or globally. All of the oil and gas sector. Well, we know on Friday trends and data is that European companies are more transparent on these issues. So there's a lot of data that those European peers of yours have put out into the marketplace and in some cases they've even verified or have that information assured by a third party. So they're saying this is true, incredible information. Here is my greenhouse gas footprint and it's been assured by this third party. So it's getting very serious. And if any of the companies that are trying to figure this out, you want to understand what sort of performance you're actually demonstrating to the world. It's easy to go to your Bloomberg terminal. Most of you have this and in the Bloomberg terminal is an entire ESG data service that you can look up your company, but again, don't just look up your company, look peers, and then there you're going to see a bunch of the ESG scores that are out there in the marketplace that are making a lot of ripples in the market. For instance, Sustainalytics is in the Bloomberg terminal. There's a CDP score in there. There's an ISS score and the list of scores goes on and on, but more importantly you can start to look at the other metrics that Bloomberg has gathering on you and putting into their database. The only way that they can gather it is if it's in the public domain. So if you see a bunch of blanks next to your name, but a bunch of numbers and qualitative information like, yes, I have a health and safety policy. Yes, I have a climate change policy in the boxes for all your peers. Then you can quickly see how you're lagging against your sector and your peers. Now a lot of companies that we deal with, we end up talking to the general counsel or corporate secretary and investor relations because these two offices within the company are the ones that field these external questions. They're not quite sure how to handle these requests for nonfinancial data and the legal is always, you know, in charge of voluntary and regulatory regulated disclosures. So you want the legal team involved in this. Then you got to start to reach out to your chief sustainability officer, your environment, health and safety people, your human resources department and others to start to think about what are the metrics we already have in house? What are we already measuring, managing it and disclosing because in many cases companies are disclosing this information to various regulatory databases or in other reports and then by looking at Bloomberg data. Yeah and your what your peers are saying. You get a good sense of what the world is already seeing and expecting from your sector and you can start to pick and choose certain things you want might want to measure, manage and report and going back to the black rock letter, definitely you want to take a look at it. TCFD guidance on climate change risk and what it means to you and in that area you want to do some scenario planning. You're looking out three, five, 10 years. How does our business look? Sea levels are rising. Do we have facilities close to, yeah. Ocean fronts close to rivers, close to deltas that could be impacted. That's a big infrastructure project to how I have to move a factory or an operation. And again, in Bloomberg I can now look up a company and see their locations around the world and I can see within the Bloomberg terminal where are those risky locations are as sea levels go up a few feet at a time over the course of years. The other thing that black rock mentioned SASB, right? So the sustainable accounting standards board is a great resource for you to use. Turn too quickly and see which metrics for your sector sadly has identified as being the most material. The key word in our field and in, in all work today is, is it material to the business? Is it material to this transaction? So SASB has done a lot of great research to identify the most material topics per sector and that's a quick way for you to get to those people specific metrics that gets you started on the roadway to managing and navigating this area of sustainability disclosure.  Adam: (13:17)So to kind of wrap up our conversation, you know, see now this is a podcast for accounting and finance professionals. What's the biggest impact that you see on them today? Based on what you've seen?  Mike: (13:30)I think, you know, the beauty of the accounting profession is that it's been around for a long time and it's very mature and very focused on facts, right? The associations that are affiliated with accountants are actively involved in this. When I ran GRI in North America, we actually were hosted by IFAC, the international Federation of accountants. Why was IFAC hosting us? Because all of the accounting associations around the world, we're starting to get these interesting questions about non financial information and, and you know, the big four accounting firms were part of the GRI as launch in North America. Why is that? Because more and more of their clients were saying, should we put this information in their 10K or annual report? Can you share this information for me? So accountants, incorporations and external accountants as well should be realized that entities like the American Institute of certified public accountants have task forces already in place that are looking at these issues. In fact, the big four came together in partnership with bank of America and some other large corporations and announced that this year is world economic forum. The a launch of the latest guidance on how companies can report, and in essence that report is kind of the, the brain trust of a lot of accountants work for many, many years in this space.  Announcer: (14:55)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Kelly: https://www.linkedin.com/in/kellypaxton/Pink Collar Crime site: https://pinkcollarcrime.com/IMA's Annual Conference & Expo 2020: https://bit.ly/2HXTN42IMA's website: https://www.imanet.org/FULL EPISODE TRANSCRIPTMitch: (00:00)Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. In the past we've included some IMA focus bonus episodes where we spoke to Ima, staff members where I am a volunteers and young professionals. Today's bonus episode is very interesting because we are going to share a conversation held with Kelly Paxton, a certified fraud examiner and pink collar crime expert. She spoke with IMS manager of brand content and storytelling, Margaret Michaels Kelly presented on pink collar crime at IMA's 2019 annual conference and expo in San Diego and she was nice enough to sit with Margaret after her presentation to share some additional insights as we approach our 2020 annual conference. We thought it would be a great opportunity to share some valuable perspectives like Kelly's and make sure you look out for this year's speakers and topics. Let's head over to the conversation now.  Margaret: (00:57)I'd like to start with your area of expertise. Can you tell us a little bit about how you became interested in pink collar crime and how you learned more about it?  Kelly: (01:15)So I became interested in pink collar crime when I was working as the fraud analyst at a local Sheriff's department. Prior to that I was, my original career was in finance and I became a customs special agent. So I was used to arresting bad guys you know, money launderers, drug dealers. But then when I go to a local Sheriff's office and I'm doing primarily embezzlement type cases, all my suspects are women. And I came across the term pink collar crime and I just started researching it and it fascinated me because we were arresting women that look like you and me. They were nice woman. I had a detective one day who, she arrested a woman who stole hundreds of thousands of dollars from her child's school where she worked at. And the detective said it was the hardest day of her career. That was this nice woman. She was crying, she was devastated, she had no criminal history, nothing. She made a bad decision and it just spiraled out of control. So I was fascinated because I was, we think of criminals as bad guys. We don't think of them as the people that live in our neighborhoods. And that's what I was seeing in embezzlement cases.  Margaret: (03:54)This is so interesting. Can you explain to us what is the difference between pink collar and white collar crime?  Kelly: (04:03)So white collar crime came in in 1939 by Edwin Sutherland. It is a crime committed by a person of high social status in the course of his occupation and it was his occupation. So it took another 50 years for pink collar crime to come out, which is petty amount stolen by lower level workers in the workplace, primarily women because women are in those positions. So what I say a huge part of the difference between pink and white collar crime is it's position, not gender. So white collar crime is generally considered to be fraud, which is Ponzi schemes, financial statement, fraud and corruption. Whereas pink collar crime, I call it garden variety embezzlement. It's the main street crime. It is the dentist who gets ripped off by his trusted office manager. It is the manufacturing company who has an accounts payable, you know, employee who steals. It's relatable. That's, I use a lot of hashtags in my social media and presentations and I call it the relatable crime. I can't tell you how many people come up when they find out what I do and they have their own story of how they are. A family member had been ripped off by someone or a school club that their kid belongs to. So I call it the relatable crumb. We don't relate to Bernie Madoff. It's just we don't, we don't live in his world. We live in the world of mainstream. Margaret: (05:37)Are there patterns in the behavior of pink collar criminals? For example, I'm not sure if you consider Elizabeth Holmes a pink collar criminal or not, but there have been reports that her behavior seemed to raise some red flags. In the cases you've worked on. What have you commonly seen?  Kelly: (05:56)So some of the common characteristics of pink collar criminals are the trusted employee. It is your right hand person, you own a business, it is your trusted employee. I will tell you it's positioned not gender. A man can be a pink collar criminal. It's the position, it's just the women are in more of these types of positions. According to census, you know, reports 90 plus percent of administrative positions are filled by women. And that's where the cash is in a business. It's in accounts payable, it's in accounts receivable, bookkeepers, receptionist's office managers. So, but they are trusted employees, absolutely trusted employees. So, um, Elizabeth Holmes, I don't consider it to be a pink collar criminal. I don't know what she actually financially profited from Theranose. But the thing about the women and pink collar criminals or the men and pink collar criminals is they're indispensable in a business. They really are indispensable. One of the, I call them pink flags instead of red flags, I call them pink flags is never taking a vacation. So if you have an employee who never takes a vacation, it is a huge pink flag. Of course, lifestyle I do, I tell businesses to do a parking lot audit, look outside and does their salary match the car? I mean, I've had a dentist who, when you find out you've been embezzled, it's horrifying. You are just gutted. And so what do people do when they're horrified? They try to bring humor in it. And so here I have this dentist, he realizes he's been ripped off and he said, you know, when I realized she drove a newer model, BMW's than me, that would be a clue. And I'm like, yep, that would be a clue. So there are patterns men steal more than women. So if you get a male pink color criminal or embezzler, he's going to steal more than a woman. Women steal 45 to 50 cents on the dollar compared to men. Embezzlers and that's been my practice. The two biggest cases I've had male embezzlers.  Margaret: (08:14)Very interesting. Well obviously you don't know someone's behavior before you hire them. Not fully at least. So what are some of the best practices for background checks or industry standards that organizations can follow when looking to hire new employees?  Kelly: (08:31)So I did background checks for many, many years and the ACFE has their report to the nation that most company, about 50% of companies do background checks. Now a background check is a rear view looking assessment. We went to look now into the future. So that's what I say, a parking lot audit lifestyle audit. Many States you can no longer run credit reports unless you did. There is a, you know, a need that can be documented. So the problem with the background check is a lot of these people may have done it before and just been fired or terminated and not prosecuted and so it won't show up on their record. But then there's a huge amount of them who have never ever been in trouble with the law before. And so their background check is going to be clean. I had a woman who stole $10 million from a car dealership and I wrote to her in prison. And we had a correspondence back and forth and she told me that she had not so much as ever even had a parking ticket and then she started stealing. So you really have to be paying attention in the now. And that's why I say the parking lot audits, you know, does the salary match the vacation? That woman who stole $10 million, she flew to the Vatican and took her family. She bought tickets to Superbowls and box tickets. So, and she, people did question some of these extravagant trips. She said, well, she had a side hustle, you know, she was very blessed. They had made some good investments. It's hard to ask a coworker like, so how are you affording that? And you know, if they were stealing, they're going to come up with some very clever answers.  Margaret: (10:22)So I guess a big thing you need to have is trust. Right? But I know that you use the hashtag trust is not an internal control. What does that mean to you and why do you use that hashtag?  Kelly: (10:37)So trust is not an internal control. This is every night I go to bed at nine o'clock, I have a Google alert that comes out on embezzlements and I read the stories of someone who's been arrested for embezzlement or pled guilty to embezzlement. And I can't tell you how many victims have said, I trusted them so much, so, so much. And it's like they were part of my family. You know, I let them into my home. The money is replaceable. That's another hashtag money is replaceable trust. So much harder to regain. So when I go in and there's a victim, I become like the fraud therapist because they feel shame. They say, how did I miss it? It's worse than the worst divorce when they steal money too. So these are likable people. You keep them around because you like them and they do good work. They're doing really good work because they're getting more than one paycheck. So, but I mean, I had one doctor who had a young woman who stole a half a million, almost a half million dollars from him. He's the only one I've talked to who said I really liked her. And I'm like, well, if you never really liked her, why'd you hire? He was busy. And he's like, she seemed competent and actually she only stole $450 he thought she left the business. He got his visa card statement and he saw that she had shopped at like staples and somewhere else. And you thought she stole $450 so we called the local Sheriff's office, they wrote a report and then he started digging and we started digging and it was almost a half a million dollars. So he's the only one who said I never really liked her, but he said I never really liked her, so I didn't let her sign checks. That isn't the only way you can steal. There are plenty of ways that you can steal. So, but generally, you know, these employers are devastated when their trusted employee has stolen from them. It's a huge breach of trust.  Margaret: (12:48)That is so fascinating. Now I have to ask, what does the hashtag, it's not rocket science mean. There must be an interesting story behind that too.  Kelly: (12:59)So I used the hashtag. It's not rocket science and the reason I use it is I'm not a CPA. I'm not smart enough to pass that test. Um, but the way that this theft embezzlement happens is very basic. Primarily it is, the money is here in the business and it goes here to the suspect's bank account. It doesn't go to Panama, it doesn't go to Lichtenstein. It's very basic. It's paper intensive. You know, there's notebooks. We have lots and lots of notebooks. It's very paper intensive. They steal checks, they steal cash, but they're not doing cyber stuff. It's just, um, it will change with the change of technology and how we bank. But really we're not zipping all over the universe with money. It's just from the business to the suspect. And that's why I say it's not rocket science because I'm not a CPA and most cops don't become cops to play with pivot tables. I mean, I love pivot tables and a pivot table will say a lot, but you're just having to trace the money and the money doesn't go very far, so that's why  Mitch: (14:13)IMA's annual conference and expo for 2020 is in Atlanta, Georgia from June 21st through June 24th for more information, please visit www.imaconference.org. Closing: (14:28)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Dr. Kelly Richmond Pope is an Associate Professor in the School of Accountancy and Management Information Systems at DePaul University in Chicago, Illinois where she teaches financial, managerial and forensic accounting. Kelly’s research on organizational misconduct culminated into directing and producing the award-winning documentary, All the Queen’s Horses, in 2017 which streamed on Netflix from July 2018-2019. In 2018, Pope became a TED speaker with her impactful and timely TED Talk entitled ‘How whistle-blowers shape history.’ Her research has been published in the Behavioral Research in Accounting, Auditing: A Journal of Theory & Practice, Journal of Business Ethics, The CPA Journal and WebCPA. She holds a Ph.D. in accounting from Virginia Tech and is a licensed CPA. In this episode of Count Me In, Kelly summarizes all her above experiences and shares an insightful perspective on how accounting, and accounting education, can effectively combine her passions for fraud, film, and lifelong learning. Her general curiosity and involvement in various topics enables her to peak the interest of and engage her students on a regular basis. To hear about how you may be able to weave your passions together and enhance your learning in the area of accounting, download and listen to this episode now!Contact Kelly: https://www.linkedin.com/in/kelly-richmond-pope-cpa-83689a5/Kelly's Website: www.kellyrichmondpope.com TED Talk: https://www.ted.com/talks/kelly_richmond_pope_how_whistle_blowers_shape_history/up-next All the Queen's Horses: https://www.allthequeenshorsesfilm.com/Red Flag Mania: www.redflagmania.com FULL EPISODE TRANSCRIPTAdam: (00:05)Welcome back to Count Me In, IMAs podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson, and I will be previewing episode 51 of our series for you. In this episode, Mitch spoke with Dr. Kelly Richmond Pope and associate professor in the school of accountancy and management information systems at DePaul university in Chicago, Illinois. Mitch asked Kelly about her various passions and how she works to combine them all in her accounting classes. Kelly is an education innovator who is an extremely engaging and thoughtful speaker. So at this time I'd like to bring you episode 51 of count me in with Dr. Kelly Richmond Pope.  Mitch: (00:48)So based on your LinkedIn and some other podcasts I've listened to you contribute to, I know you've said in the past, your passions are fraud, film, and lifelong learning. So to kind of start and we'll talk about fraud first, what is it about that and ethics that makes you so passionate?  Kelly: (01:06)Okay. Well, I think what makes me so passionate about fraud as a subject area is that any of us can find ourselves either engaged in one or victimized by one. And so it doesn't discriminate. And so I think it's not a situation where it's them. It could be any of us. And so I think the, the fact that anybody could be involved in one is really what fascinates me about them. And I think if you look at the trend of popular culture with the number of shows about crime and fraud, I think other people would agree that it is a very addictive type discipline. And I think it's so addictive because it's so applicable to all of us. So that's really what fuels my fascination.  Mitch: (02:02)And I completely agree with you. It really does draw you in all these movies and television shows. I know another part of, you know, or the main part really of what you do is teaching. And I'm just curious how you kind of weave this idea of this fascination and passion for fraud into the classroom.  Kelly: (02:20)Well, I think what is really important about accounting as a discipline is accounting is the backbone of everything or money or the ability to account for money correctly. And so regardless of what the fraud scenario is, there's always a money story and there's always a financial impact. So the person that can understand that and explain that to the lay person is the most powerful person in the room. So I use fraud as a way to really invigorated my accounting classes and my accounting students so they can understand the power that they're learning. Because I think that fraud and ethics is the absence of accounting done, right? And so really helping students and even adult learners or corporate learners understand the power of this information is important. And I think the fraud stories are so powerful, but there's always a money story in every case. And so if we can better understand that, then it makes for a more enriching learning experience, whether that's the classroom, whether that's a CPE session, whether that's a training workshop. So I use that really as part of my secret sauce, if you will, when I'm doing a presentation.  Mitch: (03:46)And then I suppose the next step is where we can start to weave in that second piece of your passion triangle, if you want to call it and film. So in addition to just basic fraud and ethics curriculum and your accounting courses, you know, how do you go about working in film and media? Are there any specific examples you'd like to share?  Kelly: (04:06)Well, I had a crazy idea about six years ago that I could create my own film. And so I did, I enrolled in a film fellowship program with Kartemquin films, which is a film collaborative based in Chicago. And I learned the business and the creative aspect of filmmaking and I want it to bring that type of storytelling into the accounting discipline because I think that stories are a way that we communicate and a way that we learn a lot of information. And I wanted to create my own. So I did this six month film fellowship program and out of that was the birth of my documentary, called All The Queen's Sources and All The Queen's Sources streamed on Netflix for a year from 27, 2018 to 2019. And I'm, it now lives on iTunes, Amazon, Google play direct TV, YouTube. And it actually was the number one documentary on iTunes, Amazon, YouTube, direct TV on it's first debut two week debut, weeks on that platform. But I think it shows the power of a great story, but I'm teaching accounting through that, through the story. So that's how it really merged the two. I didn't always want to be in the situation where I was relying on another filmmaker to hit the key points that I wanted to hit. So I just said, you know what, I can do it myself. And I think it's really important when someone from our profession makes a film because we have, we're going to go about a film and the way that an accountant needs to pull out these key key topics, which is very different than a traditional filmmaker may pull out key topics. So I think film and accounting go hand in hand.  Mitch: (06:03)That's really interesting and I can certainly appreciate the perspective of knowing the steps to go through the process and convey the right message through the story. But everything you just said leads perfectly into step three, which is lifelong learning. You already talked about, you know, learning how to make a film and going through that program. So what else are you really interested in learning about when it comes to accounting, media, whatever it may be?  Kelly: (06:29)Well, I think one of the things I like to do is I want to encourage my students to be lifelong learners. I really stress in every class that I have is that it's not about the test. It's not about an exam, whether it's the CMA exam, whether it's a CPA exam, whether it's the CFE exam, it's about your quest for knowledge and this lifelong learning desire that you need to have in you. And so it's something that I instill within my students, but it's also something that I personally believe in. I, last weekend I took a jewelry making class because I was tired of going to the store and buying jewelry when I felt like, you know what? I can make what I have in my head. Why am I searching for it? Why can't I just do it myself? So it really sort of is part of my personality and my quest to want to always keep learning. If you think about your brain as a muscle, which it is, you know, we go to the gym, we work out our other body parts. We need to still work out our brains. And the only way we can do that is by learning, continuing to learn. I'm wanting to learn challenging subjects, whether that's a new language, whether that's learning how to cook, whether that's something that's sort of outside of your comfort zone. But what I found is there's so many compliments to the accounting profession that most everything, all roads lead back to accounting is what I like to say when I'm in an audience of non accountants because it's really true.  Mitch: (08:06)I just want to take one step back real quick and just ask you if you can pinpoint any maybe event or whatever you attribute your curiosity to. To me it sounds like, you know, you have such an interest in learning new things. You're curious about things you want to solve problems. So when did that really start?  Kelly: (08:24)Well, I think my interest of being this curious creature really comes from being a professor. I mean, one of the beauties of being an educator is every class is a new slate. It's like a new canvas where you can try new things and think about innovative ways to convey information to an audience that doesn't know what you're going to tell them. So that in itself is a 10 week challenge that I'm presented with. Every time I have a new new group of students or every time I do a workshop or an invited talk somewhere, I look at that as a new challenge. And so one of the things that I enjoy is the ability to always be able to reinvent and recreate yourself. I never wanted to do something or be in a position where I did the same thing every single day. And being an educator is the perfect job for somebody that wants to continuously change and continuously update themselves and use new new methods to do that. So I think it started early just when I decided that I wanted to become an educator.  Mitch: (09:37)And this will loop us right back to our conversation and really focus on the accounting student. You know, the accounting professional continuing education. What is it that you believe all accountants must do, must be aware of you know, things that you really emphasize and focus in your classes where your presentations?  Kelly: (09:59)I think all accountants must be comfortable with, um, the trend in understanding data analytics and I think we have to embrace technology in a way that makes us more efficient and more efficient in dealing with clients. And that's you know, utilizing bots, understand AI. We have to keep up with the trends and be able to be flexible and nimble. And so I think right now if you asked me this today, I think all accountants need to be aware of data analytics. I think that, and to say that differently, we all need to be comfortable with learning a new language. And that doesn't have to be a new language like Spanish, French. I'm Italian. It needs, it means a new coding language. So I think challenging ourselves to learn how to code and being comfortable with things that we might outsource in the past we need to become versatile in a lot of different areas. And I picked this up when I started interacting with filmmakers and I realize that filmmakers have about six different skills wrapped up in one person. They often can do graphic design, they can shoot video, they can edit video, they know how to light spaces. They know how they know about audio, so they know all of these things. They're like a one stop shop kind of person. And I think that we need to be the same kind of person, that same type of professional where we have all the skills wrapped up in us as well. So we don't have to outsource so much of what we do. So I think that that's one of the things that we need to do 'em so we can become the super professional as opposed to being concerned that we're going to be an outsourced profession.  Mitch: (11:55)I love that response and I appreciate that perspective on this. So I would kind of just like to ask a follow up and wrap up the conversation with, you know, what do you see the connection between data analytics, all these emerging technologies and the fraud that you are so passionate about, where does that intersection occur?  Kelly: (12:14)Well, that's a really interesting question because I think with the use of data, I mean data will allow us to observe behaviors pick out trends that the human professional may not be able to do as quickly because we have so many personal biases that enter into our judgment. And so I think with the use of data, we will be able to identify fraud patterns in a way that we might not have been able to in the past. So I hope that as we embrace data analytics and more technology fraud discovery will start to rise. Because if you really think about a fraud is one of our, one of our world epidemics. And so if we can use data as a way to minimize the impact of fraud, then that will be a good thing.  Announcer: (13:07)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Jirav: https://www.jirav.com/Cloud Accounting podcast: https://www.cloudaccountingpodcast.com/Blake's website: https://www.blakeoliver.com/More About Blake: 1) https://www.cloudaccountingpodcast.com/about2) https://www.blakeoliver.com/bioContact Blake: LinkedIn - https://www.linkedin.com/in/blaketoliverTwitter - https://twitter.com/blaketoliver/FULL EPISODE TRANSCRIPTMitch: (00:05)Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I am your host Mitch Roshong and I am happy to share our 50th episode of the series for this conversation. My cohost, Adam Larson, spoke with Blake Oliver. Blake is recognized by Accounting Today as one of the top 100 most influential people in the industry. He's the director of marketing for Jirav and is the cohost of his own podcast, the Cloud Accounting podcast. He joined Adam to talk about technology trends in accounting, like automation for reporting and forecasting as well as other things affecting the accounting and finance world. So without further delay, let's listen to their conversation now.  Adam: (00:50)So Blake, you're recognized as the leader in the accounting industry and you've spent much of your career connected to the cloud. Can you maybe give us an overview as to what trends you're seeing in the industry?  Blake: (01:01)Sure. And thanks for having me on your show. A real an honor to be here and talking to the IMA base. So I started at the very bottom of the accounting career ladder as a, as a bookkeeper. And a lot of what I know about technology is, is based on that experience. I was a in case you're curious, I was a music major in college, not an accounting major, not a finance major. So I think that's helped a lot, helped me approach things with a fresh set of eyes in a lot of cases. Okay. So what happened is I graduated from college and I had this useless music decree and I was still trying to freelance and maybe have a professional career and I picked up bookkeeping as a flexible kind of day job I could do. And so I was doing QuickBooks data entry mostly and I had some clients on the side. A lot of what I did, I would say 80% of what I did was keying in transactions into QuickBooks from PDF bank statements are actually more likely printed ones at that point. So, you know, people were sending me there bank statements they were receiving in the mail. I'd key those in categorize their transactions and create reports. And I liked it cause it was kind of a mindless, the thing that I could do in front of the TV or listening to my favorite music and anybody who's been paying attention to what's been going on over the last 10 years knows that we don't really do that anymore. At least in the world of small business. Manually keying in data is not necessary. We've got online accounting, we've got cloud accounting, we have bank feeds, we have API integrations and when that started to all happen around 2010 was when it really started to get big and become, you know, easy to do with off the shelf software. I jumped on that. And so within about five years, I had automated about 80% of my own job as a bookkeeper. Uh, and I started a business doing that and it was a cloud accounting from, we were virtual. We did bookkeeping in a new way. We could lower our prices off for clients more. It was a big business, you know, we grew to 200 clients in three years and I was able to sell that thing. So that kind of proves just how a successful automating inputs can be and so a lot of what we've scene over the last 10 years, both on the, on the small business side and now creeping up into the mid market and enterprise is basically automating that entry of transactions that getting the data into our ERP system or our accounting system, whether that's QuickBooks or zero or NetSuite or Intacct or Oracle or SAP. It's all the same concept. And I think it happened first in the small business side because small businesses are very price sensitive. And so there was this need to automate that, that entry of data. Lot of business owners, they just can't afford accountants or bookkeepers mean the vast majority of business owners do with their own accounting and so there was a motivation for developers to build that stuff. It's been slower in the mid market because, yeah, at scale when you're a big business, it's, well not that expensive really to hire a staff accountant right out of school and make that person just a import transactions manually every day and reconcile the bank account manually and all that, but I think that that's starting to change in some organizations have really figured out how to automate data flow. Some not at all. Right. And some are blocked because they're on, on premises ERP systems. It's very expensive to switch. So we're at this interesting place about 10 years after the birth of cloud accounting where we have some cutting edge folks that have completely automated most of their data entry. We've got folks that are continuing to do it exactly the same way they did 10 years ago, and we're going to continue to see over the next 10 years real divergence among those groups and it's gonna make people's careers or break them. I think.  Adam: (05:19)So I'm sure there's a range of people listening to this podcast right now, whether they've started some sort of automated reporting and forecasting or some others who hadn't even, haven't even begun to there. And like you said, they're still doing accounting like they did 10 years ago. Can you maybe discuss some of those barriers that they may run into and how could they overcome those?  Blake: (05:38)Yeah, the biggest barrier that I see is when a finance team or an accounting team is stuck with an on premises ERP system and for whatever reason it's decided that it's too expensive to change or perhaps there's not a solution out there that's customized enough to their business. There's always, you know, reasons for keeping old technology and you have to just figure out how to adapt. And that's been the big barrier to adopting cloud is if you don't have API's, if you don't, by the way, API is application protocol interface. It's simply a way for computer programs to talk to each other. And cloud makes us easy because you've got apps hosted in the cloud and they all have API APIs. A lot of them do these days. And so it allows you to hook them together and transfer data. Well not as easy to do when you've got an on prem system. It typically doesn't have an API and you could pay somebody to develop it, but that's expensive to maintain and it usually out of reach for a lot of organizations. So we've had this divergence where folks who are on cloud ERP systems or cloud accounting systems are able to take advantage of all this automation and those that aren't, aren't, well, there is a technology out there that has been talked about quite a bit and I think this is actually one of those technologies that is not a bunch of hype. It's going to have a real huge impact. And that is RPA, robotic process automation. And it sounds really fancy, but it's actually a really simple idea. Think of an Excel macro. An Excel macro is a little program you can write as an Excel user without needing to necessarily know how to code. Maybe you do a little bit of coding and visual basic or something like that, but it's not, you don't have to be a developer to do it. Well, RPA, you can think of as simply an Excel macro that can work outside of Excel. It can function across programs on your computer and click a mouse like a human type in texts like a human. You combine this technology with OCR, which is the ability for a program too. Read a document and transcribe it into text and then interpret that text. If you add a little artificial intelligence, a little machine learning into this concept of macros and you mix that all together, that's RPA. So it allows you to do, it's basically automate the flow of data in and out of systems that don't have APIs. It's like a replacement for that person sitting in front of the computer, probably me 10 years ago, keying in information. You could hand an RPA tool, a bank statement, and you could teach it how to code transactions into your desktop accounting software. That's the promise of it. There's been a ton of investment. It's you know, multibillion dollar industry now. And that I think is going to be what poles, the rest of the teams that are not on cloud into this world of, of automation.  Adam: (08:39)So it's going to bring teams together that aren't normally together. What other benefits do you see from a company making the effort to take that extra step to start, if they have those barriers in place, and they go to RPA or even if they don't have those in place and they just, they convinced their boss, Hey, we need to go this route. What are some of the benefits that you're seeing that for people adding this to their business?  Blake: (09:02)Well, one of the benefits that I'm enjoying right now is the ability to work remotely. When you have access to your systems and your data in the cloud you can work from anywhere. And that is really important in the accounting profession because we have a talent shortage right now. We don't have enough CPAs, CMS, basically anybody who you know, really knows what they're doing, it's hard to find a talent. And so it's important that we as managers and CFOs and the controllers figure out a way to let our employees work from home at least part of the time. Okay. Remote work has been increasing between a 2005 and 2017. There was 159% increase in remote work and there are now 4.7 million people, mostly knowledge workers who work remotely. That's 3.4% of the population, right? Not a very big number as a percentage of the entire us population. But if you think that most of those people are in professions, then it's a lot actually. Um, as, as it gets harder and harder to recruit folks, we're going to see remote becoming more important. So that in addition to the, yeah, just the efficiency gains you get from RPA and cloud and API APIs, it's going to drive a lot of productivity which will allow us to do more with fewer people. Adam: (10:33)I think those are some very good benefits and where somebody looking into what are the risks?  Blake: (10:40)So security of course is the big risk right now. Malware attacks malware attacks in particular have been really bad over the last year or two on hosting providers. So this is something that if you are going to migrate to a cloud solution you gotta be really careful about is selecting the right provider and the right type of hosting. So the type of hosting that's been susceptible to malware attack is shared hosting where you are provisioned the workspace on a server that has multiple companies sharing the same resource. If one of those companies gets infected with malware, then your instance or your workspace could be affected as well. And that recently took down a provider called Insync. Ironically, a company called summit hosting acquired in sync after the malware attack. And then they themselves, we're a target of a malware attack. And I mean this can put you as a customer of these providers out of commission for a week or two or more. I think the summit folks, some of them we're down all last week. Yeah, we're recording this toward the end of January. I mean, can you imagine if you're an accounting firm or if you're a corporate finance department not having access to your Sage files or your Intuit, here are your QuickBooks files for a week. Like how would you function? So that is a big concern. It's causing some people to say, Oh, we're not going to do that. We're going to stay with our local server in our office and it's true. That may make you less of a target, right? Because you're not part of one of these bigger companies, but you definitely, well, you most likely will not have the same security protocols in place as a hosting provider. So you yourself might be an easier target in some ways, even though you're a smaller target. So it's a real concern and it can be addressed. But it's something that that needs to be top of mind when you are going to cloud, especially if you're going to keep a desktop style application and host it in the cloud rather than going to true SAS.  Adam: (12:57)Where do you think we're going in the next 10 years? You know, you mentioned you kind of walk through your story of your, these last 10 years, but where do you think we're going for these next 10 years?  Blake: (13:06)So as I mentioned, a ton of the productivity gains thus far in the world of cloud accounting have been on the data input side. And I think that the next 10 20 years is going to be about the outputs because that's where we really create value. Four management or for our clients is in the information we give them the reports, we give them the insights that we give them. And we talk a lot in the profession about becoming better storytellers, becoming advisors versus number crunchers. Everybody wants to go there. Controllers want to be risk managers. They don't want to be number crunchers. Accountants with their own practices, right? They want to be advisors, even coaches. So their clients, they don't want to just be filling out a tax return. So the question is how do we get there, right? What is actually the way that we do it? We all want to do a better, how do we do it? And the answer in my mind is forecasting the ability to look into the future and figure out with a client or with management what is going to happen, what is likely to happen. And it's not just about financial numbers anymore, it's about non-financial metrics, website visits leads generated, maybe manufacturing activity. everything is game, right. We shouldn't just be focused on the numbers that have to do with dollars. We should be focused on all the metrics that are important to the business and accountants, we are really, really well positioned to own the aggregation of all that data from across all the different departments in the business. Yes. And put that together into something that's meaningful, interrelate all that data, both non-financial and financial. So a lot of time we, we talk about creating dashboards but it's not enough just to create dashboards because most of the time dashboards, if that's all you're doing there historical, we're, we're creating some KPIs. We're looking historically it's better than nothing, but it's not helping us look into the future. so that's where forecasting comes in and there's a lot of forecasting technology out there. I happen to think that the best kind is driver based financial modeling. Almost a modeling is this sort of complicated thing that we've done in Excel. You have to be an Excel wizard to do it because it's really hard. Ah, yeah. There's entire books and courses about how to do financial modeling and Excel and you get paid a lot of money to do it if you can learn how. Right. But the problem is it's, yeah, very easy to break, right? It's, it's delicate. It's exposed database, right? There's better ways to do this. So a lot of companies are coming along and we probably have heard of them, you know, host analytics, adaptive insights that, that take this concept of financial modeling and put rails around it, right? So that you and people can collaborate and you can import actuals and everything like that. So I'm working with a company now called Jirav. I started working there at the end of last year and our goal is to bring that financial modeling technology, which. normally is very, very expensive to small and medium sized businesses. So you can create plans that, that are driver based that you use custom data, not just financial data. And then you can sync that up with your actuals in your QuickBooks online or your net suite or your zero file and you can do forecasting every month and roll it forward automatically. Okay. We'll import your headcount data from your payroll system, such as Gusto, ADP, paychecks, you're interrelating all of that with your financial information, with your non financials and, and you know, doing real monthly re-forecasting, which is most small businesses just never did it because it's so expensive to pay a CFO to do that for you.  Adam: (17:12)You know, Blake, those are some great insights and I just wanted to thank you again for coming on the podcast today. We really appreciate having you on.  Blake: (17:20)Oh yeah, it's a pleasure. And do you mind if I pitch my own podcast? Sure. So if you want to stay up on what's going on in the world of cloud accounting, I have a show called the cloud accounting podcast. I do this with David Leary who spent 20 years working at Intuit. So he comes from the software side. I come from the last 10 years, mostly in public accounting and we get together every week and we go through all the news stories that are top of mind for us. So that way you don't have to read accounting today. Journal of accountancy, accounting, web, all those sites to try and stay up on what's going on. Actually, I also read the IMA magazine. Was it Strategic Finance? Is that, is that it? Yeah. So, you know, we talk about those articles, we analyze them, we discuss them. And so in an hour a week, you get the top stories that you need to know as an accountant.  Announcer: (18:14)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA'S website at www.imanet.org.

Count Me In Episode 10 (Part 1) with Rhondalynn Korolak: https://podcast.imanet.org/10Contact Rhondalynn:LinkedIn - https://www.linkedin.com/in/imagineering/Rhondalynn's Work & Recognition: http://www.prweb.com/releases/2016/11/prweb13878827.htm https://www.youtube.com/watch?v=jb2rqTL4QW8&feature=youtu.be https://www.youtube.com/watch?v=J3rRoQUxb5g&feature=youtu.be Finalist - Best Digital Start Up - 23rd annual AMY Awards Top 3 Finalist - Female Fintech Leader of the Year, Excellence in Data and Artificial Intelligence Top 10 Cloud Accounting Apps of 2016 Top 10 Small Business Apps of 2016 FULL EPISODE TRANSCRIPTMitch: (00:05)Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I am your host Mitch Roshong and I am here to share another bonus episode of our series with you. If you recall a few months back, my cohost Adam spoke with Rhondalynn Korolak. She joined him from Australia to talk about how accounting skills translate to effectively running a business. Today we are going to hear the conclusion of their conversation and hear some of Rhondalynn's recommendations for adapting to the evolving accounting and finance world. She refers to it as future-proofing yourself. So let's head over and listen now.  Adam: (00:43)So how have you evolved your own career from public taxation to a successful business professional in the accounting space?  Rhondalynn: (00:49)Well, I started off with PWC in Calgary, Alberta, Canada. So my specialization I guess when I went through became a chartered accountant and article was oil and gas taxation. So primarily as you can imagine, me working with a lot of big firms, you know, the sort of shells and mobiles of the world. And it wasn't really until I immigrated about 14 years ago to Australia that I had the opportunity to start working with some smaller businesses. So when I became a permanent resident and a citizen of Australia, I decided I wanted to go out on my own. And the natural inkling, inclination, I guess for me is I wanted to work with small businesses. So I thought that I would go out into the world in a coaching capacity. So I thought I'm going to take everything that I've learned from qualifying and practicing as a lawyer and also a chartered accountant in Canada and I'm going to apply all those skills and I'm going to coach small businesses. And I kind of had a couple of aha moments, right? So aha moment number one is, no, please, please, I'm, forgive me because this is a little bit pre-cloud. So this is going back at least about a decade now. And it was before a lot of the cloud accounting packages even existed. And so I was going out and I was doing Excel spreadsheets. I was printing a lot of reports from my clients. I was giving them traditional dashboards and KPIs and you know, I would go out and coach these people and I couldn't figure out why nobody was actually taking action, you know, because I thought what I was telling them was really important. I was going out with all these KPIs and saying, do you know it takes 92 days to collect your debts and you know, giving them kind of a wrap on the fingers with a ruler. And people were listening to me a lot and they were shaking their heads and stuff and nodding in agreement and they, they knew that it was bad and they knew that they had to do some stuff, but they couldn't actually action it. They, they, they had no clue really what I was saying and what it tangibly meant to their business. So this was my first aha moment. I thought, okay, never worked with small business businesses before. I'm now trying to coach these people, but nobody's taking action. What's the problem? So I learned a couple of things. I learned that the number one problem by far in every single business is cashflow. But nobody wants to talk about it because people hate or they're terrified of their numbers. So that's kind of, you know, the big hairy, um, you know, wake up call for me, number one, number two was 90 some percent of all these people that we're working with, these small businesses, they're completely financially illiterate. So that was another big, huge surprise to me because I just sort of assumed as an accountant that if you had your own business, you might take some time out to learn about financial so that you could operate it correctly. But that is not true. That's not what people do. People go into business because they're good at what they do. They're technicians, they cut hair really well, they do plumbing or electrical contracting really well. They're excellent at selling shoes or you know, operating a retail store or running a restaurant. They don't want to become accountants. And so these were huge revelations to me because I just thought that I could take all this wonderful, you know, insight that I had and all of my accounting and math skills and legal skills and go out and coach people. But I realized that it is not about what you know, it's about what you can move your client to do. And so the biggest things that I learned about making this transition from what might be traditional accounting to more of advice or coaching or whatever you want to call it, is this, we need to find better ways to get leverage on our clients and to actually inspire them to step up and take some action. And that's all soft skills, right? That has nothing to do with learning more about cashflow or learning more about ratio analysis or or trends or cashflow forecasting. You know, in my opinion, we as accountants spend far too much time doing that stuff when, let's be honest, you know, my first client, one of the very first clients that I had was in the aged care business. And when I showed up on the very first day that I was there to coach her, she found out that she had just lost her, her top client. That was where 30% of her revenue. And so all of the work that I had done in preparation for that meeting, reading her financials, preparing cashflow, forecast, all that stuff throughout the window, it wasn't worth anything to her because she had just had a major shift in that business. And so all of that past stuff was irrelevant. And even what I thought the future was going to be like was irrelevant. And the whole coaching was how am I going to put enough value on the table and help her clop back the revenue that she lost so that she can bloody afford to continue in business and to pay me, be there to advise her. And so that was really the big shift for me, right? Is I just thought that I already knew everything that I needed to know from my legal studies and practice and my accounting to do this, you know, job that I wanted to do and I didn't. And so that's when I just became really curious about things like neuroscience, you know, how do our brains process information and make decisions. And that's when kind of my big, you know, lightning bulb or flash moment came for the third time. And what I learned from studying about the brain, and you know, I, I took a deep dive, I read 200 over 200 studies published in, you know, Princeton, Harvard, and Stanford on neuroscience. I took courses on a clinical hypnotherapy so that I could understand a bit better how the brain worked. And what I learned from all of that was this, the parts of our brain that actually make decisions and take action are automated mechanisms. So these things kick in. They're survival-based mechanisms. They're highly influenced by pictures and emotions and survival instincts. Those parts of our brain can't even read numbers or words. So just think about this for a minute. We're going out and we're talking to small businesses every day. Cash flows. The number one thing that's a problem cashflow's all about numbers. And I just told you that the parts of the brain that human beings use to decide can read numbers or words. So, you know, that's a huge transition and a huge, um, you know, milestone that we need to get over as a profession because our net natural inclination is to want to go out and talk to people and teach them accounting. And that's exactly the wrong approach. You know, that's why I wrote financial foreplay, which was my second book and that's why I came up with my, you know, my software is I tried to figure out how can we use storytelling, how can we make cashflow so simple that a six year old could understand it and get their heads around it and actually take some action. And that's kinda how I approach this whole thing. So for me to making the transition from what I was doing before in taxation and working with big companies to working with smaller businesses and you know, being more in the advisor or coaching kind of space is that we need to stop trying to put lipstick on a pig, right? So we're trying to dress something up and make it look better than it does when we really, when what we really need to do is step back and say, look, the people that we're speaking to in this conversation right now, our clients, they are not financially literate as we are and we need to speak their language. We need to remove the accounting jargon, remove the complexity, we need to stop trying to teach them how to do cashflow and rather start teaching them what it looks like visually and how to put the finger on the, on the pulse of their business and make changes. So it's kind of a, my long winded explanation of how I got to where I was, I realized that what I really needed to do get a whole lot better at communicating with people, getting leverage on people and just in expiring inspiring or influencing them to take action. And those were, that's pretty much been the area where I have focused my development for the last decade cause I already knew what I needed to know about cashflow. But it's about how do we get beyond that.  Adam: (09:40)So how important are things like data visualization in today's environment? You know, just going off of what you're just talking about you know, we need to be able to display and show what's happening, what's telling the story of what's going on with whatever we're trying to show us. How important would you say data visualization is now?  Rhondalynn: (09:59)Well, that's a really tricky question because I think that most people have too many things on their graphs and on their charts and they're actually confusing and overwhelming the parts of the brain that decides. And so data visualization in my world is more about how do we take what we can see and how do we translate that into stories and pictures and things that are non-financial but get the, get the point across to our clients. So I actually think that we are probably still providing the average lay person, small business owner with far too much in order for them to make decisions. I think that we're too ambitious about what we think that they can comprehend and grasp and what they can actually comprehend and grasp. You know, I was at an expo booth about 18 months ago and I overheard one of the vendors talking about how they could now wrap 16 variables on one graph. And I just shook my head and laughed to myself because they don't get it. You know, we need to remove complexity. Your ability to get paid a premium price as an accountant is directly proportionate to the number of things that you take off of your client's plate. So if you can remove complexity and increase clarity, focus the man on the one or two things that they need to do and get rid of the other 40 you're going to get paid more money because you're going to have impact. You're going to actually create impact. If your client comes to you with 40 things on their to do lists and they leave with 38 you haven't done your job. You know, and, and my, my views on this is probably quite different. And what a lot of other people running, you know, power BI and all these, you know, people are thinking, but what we're doing is we're creating dashboards using those tools for us, right? We're doing what we want, not what the client wants. And that's a huge dilemma because if you are very, very good, you know, like look at the biggest, you know, business showman that had ever been, the people that Steve jobs, the Richard Branson, most guys are highly charismatic, you know, an effective at getting their point across and at getting people, you know, bought into or evangelizing the journey and they are able to tell the stories and you know, do it. So yes, if you are really good at communicating and getting people to see the vision and I understand the story, you might be able to get away with a power BI dashboard, but by in large, if you're talking to a small business owner, it's too much for them.  Adam: (12:49)So we've covered, you know, many different topics throughout our conversations. And just to kind of sum things up, you know what recommendations do you have for the future of our accounting and finance listeners?  Rhondalynn: (13:02)I think the biggest recommendation is keep your mind open to learning, right? Because as we learn and grow, we earned the right and the privilege to help our clients with more and more complex issues. You know, right now people by and large are coming to us as accountants with often the same problem over and over and over again in their business. It doesn't serve us to obfuscate their financial performance. We need to find ways to turn the lights on for these people. The other thing is, is that I would highly recommend focusing on high touch as the answer. Not high tech tech is going to always be there and yes, we need to roll with the times. We need to know how to use things because they're automating a lot of what we do and, and there's huge power and leverage and all of that stuff. The most valuable skill that we can get is our ability to sit with a client and to really ask the tough questions. You know, it's not unusual when I'm doing diagnostics to have, you know, 70% of the time the client will express tears and paint. We need to get people to that point when we're working with them because that's where the leverage is. You know, when we know what really is keeping these people up at night, what's worrying them, what's upsetting them. We can then work with them in collaboration, not controlling the living daylights out of it, collaborating with them to help them find their own solutions and to run a more successful business. You know, that's, that's the future of our profession and it's a noble one. It's an honorable one. It's something that we can get enormous satisfaction from because we're helping people to put food on the table, you know, put their kids in school and pay for vacations because we've helped them run a more successful business.  Announcer: (14:56)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Katie: https://leaders-online.com/contact/Katie's recent content: https://www.linkedin.com/in/katiethomascpa/detail/recent-activity/shares/FULL EPISODE TRANSCRIPT(Foreword) Adam: (00:00)Hey everyone. Adam here. Before we get started with today's episode, I want to thank you all for joining us each week and taking part of these great conversations we are having, but I have to ask you a favor. If you listen each week and you enjoy this podcast, please go on iTunes and rate us and leave a review. This helps our podcast be able to reach more people. Thank you so much in advance for taking the time. And now here's today's episode  Adam: (00:22)Welcome back to Count Me In. I am a podcast about all things affecting the accounting and finance world. I am your host, Adam Larson and I'm happy to bring you episode 49 of our series one in which we are fortunate enough to be joined by Katie Thomas. Katie is a CPA who is the founder and owner of leaders online, a digital marketing agency for professional service providers. She is a content creation expert and national speakers strives to guide firms through their digital transformations and grow their business. Let's head over and listen to her conversation with Mitch now.  Mitch: (00:59)So in your role, what have you seen as far as technology changing the landscape of the accounting industry?  Katie: (01:12)So, Mitch, that's a great question and it's pretty loaded as it could be expanded to a wide variety of areas, but to focus in on a few areas, I'm going to have to go with the collaboration, work quality and efficiency. So with collaboration, the technology available to actually support collaboration has enabled small and large firms to truly reach way beyond the walls of just their building. So these firms can work with clients all over and then also have employees staffed all over. So no longer are they being constrained to a physical location. And then of course efficiency, that's huge. Firms are able to get way more done a lot quicker. And so like bill.com receipt bank and all of those apps available have allowed firms to become more efficient. And then the quality, this is really important aspect of technology. Of course it's great to be become more efficient, but the quality of the work and removing, you know, some of the chance of human error is great because there's, you know, the work is getting done correctly. Efficiency and like I said, collaboration. So tying all of these together, I think a really important piece that you can, you know, take all these aspects and kind of pull out is that we have better relationships both internally with employees and then also externally with class clients because we can focus on the things that truly matter, like the high level work output that needs done and then building relationships rather than just spending our time doing mundane tasks.  Mitch: (02:54)Yeah, I think those are all great points. And to just kind of follow up real quick, what kind of results do you think this collaboration work quality and efficiency ultimately leads to for the organization as a whole?  Katie: (03:07)It leads to, in my opinion, a lot better, stronger vision and fulfillment of the firm's mission whenever everyone is on the same page, both internally, so the staff and externally the clients, then everyone's working towards the same goal. And no one feels like they're being left out, but they're not on the same page. And the sense of unity that it brings is incredible.  Mitch: (03:37)I think that's a great point. So thank you for tying all that together. And I would say the next step of this technology that's available to these organizations is the ability to use analytics. So what is your perspective in regards to organizations embracing analytics and what does that really help the business answer?  Katie: (03:56)So with analytics, it's really important to just go to the basics of what gets measured can be fixed. And all of the software that firms are using today is providing data. So your marketing software, your practice management software, your client portal and so forth. And then you need to actually take this data and get it into a single location where you can understand the data and have context around what's impacting the outcomes. So you need to be looking at leading and lagging indicators with the leading indicators. These are the ones that look forward at future outcomes and events. And then your lagging indicator, it's going to look back at whether the intended result was achieved. So for example, let's say a firm has their profit down, that's going to be a past event. It's a lagging indicator. Now we need to actually look at why and see what went into this happening. So some of the leading indicators, you know, we might look at our, is it because we don't have enough new clients coming in the door? Is our client churn rate too high? What are our marketing efforts looking like? And you have to bring all the data together to understand the story and for the data to tell the correct story, you can't be missing half of the pages, right? So it's really imperative to have all this data in one place and then we can take action based off the entire story telling us.  Mitch: (05:25)So a big you know, baseline for the analytics that we typically talk about are going up the analytics curve from the descriptive analytics all the way through the adaptive analytics. Ideally, once technology is really enabled throughout the organization. So as people are making these decisions and we have all this data in this one place, I'm just curious what you think. Um, you know, if there are any specific technology tools or certain types of analytics that businesses should be really focusing on to get some better results.  Katie: (05:57)So it really depends upon, you know, what technology they're using in terms of what sort of analytics platform is going to work best for them. Because you know, if you're trying to use a piece of software that doesn't say connect with your marketing data that's going to be difficult to look at some of those leading indicators. But for example, a platform like Malartu, they're really awesome at bringing all the data together. A fathom is of course very, very popular in our industry, power BI, they're looking, you know, to get really complex. So there's a whole lot of tools available. And I wouldn't say that there's like a best tool because what works best for one firm or maybe for one of the firms clients to help them analyze their data. It's gonna vary, you know, business to business.  Mitch: (06:47)And I think that's a great segue into kind of giving you an opportunity to talk about what it is specifically that you do. So we're accounting and finance, but I know you have a very unique perspective on how accounting and finance organizations can use this data. So what does all of this really mean when it comes to building a sustainable brand for an organization?  Katie: (07:08)So when it comes to building a sustainable and strong brand, I think it's always important not to get distracted by all of the information available to you in first focus in on proving that you are a strong brand to your existing clients. So some of the ways you can do this is by never missing deadlines, being responsive. I don't know how many times we hear accountants aren't, you know, they, they're hard to get in touch with. So be super responsive, not only to your clients, but to your staff in making sure that there's complete context in every single conversation. So let's say for example, we have Ann and Bob both working on our client ABC company. Both Ann and Bob should be able to communicate with ABC company without gaps. For example, Bob shouldn't be asking ABC company something that they told in last week the software available today and the technology, it really supports us in being able to democratize data this way. So first we should be proving to our existing clients that we're a strong brand. But then of course the next question is how do we build a strong brand when it comes to a wider market? And how do we get them to truly understand who we are, what we stand for, and ultimately what our brand represents? Well, kind of like the first, the first thing we talked about and it being a really wide answer. There's a, there's a lot of different directions you can take to build strong brand, but this is really the plug for this is the most ridiculously powerful software that is available to every single practitioner out there. And you don't even have to pay for a license. It's social media and social media allows you to attract new clients, connect with new clients, build relationships with new clients. And while it's amazing to use it to attract new clients, a want to say that it's social media really does so much more than just simply help you, you know, project who you are to these new clients and attract them and bring them into your firm. It really impacts all stakeholders who interface with your firm there. They're all impacted by your social media brand. And this is why I think social media is so incredible to build a strong sustainable brand because it really influences not just those perspective clients but your employees other partners in your firm your community members really, it allows you to reach everyone and going back, you know, to some of the other things we talked about, communicate your mission, your vision, who you are, what you stand for. So social media is really, really powerful.  Mitch: (09:55)All right, so I wanted to give you an opportunity to kind of take this conversation one step further as far as digital marketing and kind of have you talked to us a little bit about what you do and your team as far as guiding businesses through digital transformations.  Katie: (10:10)So Mitch, what we do is we simply help firms become more profitable. So whether that is helping them increase their revenue, uh, through adding new clients to their business, we really focused on digital marketing there and helping them build an online presence and attract new clients or we help them decrease their expenses. Typically this is going to be helping them become more efficient. So implement more efficient workflows, streamline their existing processes integrate new technology into the firm. And a lot of times firms come to us either wanting to grow their business and attract new clients or they already recognized that, you know, they want to become more efficient. And it's really interesting because as we're working with them on one side or the other whether that be the marketing or more on the process and technology side of things, typically once we solve one problem, they want to address the other side of the equation. So if, you know, they get their processes in order, they're like, wow, I feel great, feel confident. Let's bring on some new clients. Or with marketing, they want to start there. We're able to really bring them on the number of clients that they're looking for. So if they really want to grow, well, pretty soon they're like, this is great, I'm growing. But you know, I want to evaluate my, you know, my systems and processes so I can become more efficient. So that's why we say we really help firms become more profitable and you know, how we do that. It's working with both sides of the equation.  Mitch: (11:54)And I guess just my last question here, you know, you've talked about taking advantage of different technologies, digital transformations with social media and digital marketing. If you had to take a guess, what do you think the future of accounting and finance has next? You know, we talked about these emerging technologies and data being all over the place, but what would your prediction be as far as what the industry could expect next?  Katie: (12:20)Oh my goodness. Well, I definitely don't have a crystal ball. I think we're going to continue to see a lot of small firms popping up because of the technology that enables, you know, a solo practitioner to start their own business. I think that we're also going to see this standard of, you know, the average quality of service that these practitioners provide increase. And I also think that we're going to see the role of the, you know, average accountant, average bookkeeper tax prepare, really transform into the adviser, which that's already happening. But I think as we continue to move forward, it's, it's going to become more and more that just the advisor is what the accountant is thought of rather than ,you know, I'm looking for a bookkeeper, so I contact the accountant. They're going to be looking for a new advisor.  Announcer: (13:20)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Reed's Contact Details: Bliss Profile: http://www.blissintegrated.com/people/reed-handley/ LinkedIn: https://www.linkedin.com/in/reed-handley-08738254/  Additional Relevant Content from Reed: Bliss Blog: “What’s Driving Digital Transformation in Financial Services?” by Reed Handley, December 8, 2019. “Fresh-Brewed News” Podcast: “Episode 90: Data Difference,” by Reed Handley, March 19, 2019. FULL EPISODE TRANSCRIPTAdam: (00:04)Hey everyone, thanks for coming back and listening to episode 48 of Count Me In. As you will hear Mitch address in a moment, today's episode features an expert guest who talks about accounting and finance from an outside point of view. Reed Handley, senior vice president at Bliss Integrated Communication, shares her perspective on the changing needs of finance organizations when it comes to their PR and media. This content is highly transferable for all our listeners and we're excited to share another great episode. So let's head over to the conversation now.  Mitch: (00:39)So our conversation is a little different today as we're going to talk about accounting and finance from the marketing and communication perspective, right? So to kick things off and give us an idea of what exactly it is that you do, what are some of the popular needs of companies and financial services when it comes to PR and media?  Reed: (00:57)Well, thank you for having me. I'm very excited about discussing this with you. I will jump right in and say from my vantage point, I think there are three core issues, from a PR perspective that have overlapping spheres of influence. And those are raising awareness, building trust and brand loyalty, which supports the never ending drive to expand share of wallet with customers. And then the third piece is harnessing data for storytelling and also to use data as a jumping off point for more strategic insights. I'll jump into the raising awareness piece just because I think that that's the most overarching issue that we come across. And it really depends on where an organization falls in its life cycle. So the goal could be to become a household name, or to hold onto your place as a household name among target audiences. And that can be regardless if you're, focusing on a B2C space or if you're a B2B professional. So that brings up the big question of innovation and how that plays a role. I will say, and I'm sure you're seeing this as well, but digital transformation across almost every industry out there is having a seismic impact. On how we're communicating about the value of the product or service we're providing. And nowhere, in my opinion, is that more apparent than in the financial services space. but it's absolutely happening across management consulting, accounting law firms as well. It's something that I think every single, major industry is grappling with how to manage effectively. So I could give you an example from the wealth management space, which is where our sort of, a lot of my personal experience stems from. you know, technology has completely up-leveled and democratize the way consumers and also the individuals and businesses who sell to those consumers are managing money and receiving advice, which is not that hard to think about. You consider the ease with which people are now reviewing or trading or analyzing their financial lives. compared to the days before FinTech apps and SAS platforms existed, like mint and RightCapital capital and Expensify, you know, there's a whole universe out there now, that makes it easier. So from a marketing and PR perspective, there's a huge demand from financial institutions and professional services firms to create programs that showcase the value of your technology, especially as it relates to enhancing the customer and the employee experience. ultimately you're looking to attract and retain both targets and talent. So, you know, figuring out how the communications workflow fits within the technology workflow is really, really critical.  Mitch: (03:46)Now you've been with bliss for over five years, I believe. Is that correct?  Reed:Yes, that's right.  Mitch:And I'm sure more communication roles prior to that. So with all this technology and innovation, you know, how has your job changed? Like what exactly is different about the needs of these financial services and any other industry really as far as who you are trying to put out this awareness?  Reed: (04:07)Well, this is a big meaty question. I will say I think from a practitioner standpoint and a strategic standpoint, the number one need and in many cases I would argue pain-points is harnessing data for storytelling. and that, that goes for both B to B and B to C companies. I think practically every institution in the financial services space and certainly in professional services is seeking new ways to aggregate data for more research backed data driven, driven customer focused experiences. and you may ask why the, and what's shocking to me is that the expectation across the spectrum is so high among people that we're trying to target. we're now in a period where people are more willing than ever to pay a premium for exceptional service, which is particularly noteworthy for increasingly commoditized industries like ours, both from a marketing standpoint but also from an accounting standpoint. I came across two really great pieces of data about this recently. Forrester, reported that 70% of B2B firms say cup customers have higher expectations than in previous years. And Gartner also reported that 82% of B2B CMOs, so vast majority, believe they will be competing mostly on customer experience and not on product or service attributes by 2020, which is this year. so that tells us that customer experience and the way you're communicating with your customers at any point of their sort of journey in terms of getting to know you and your organization is really the crux in differentiating yourself in a competitive environment. which means, and can be a little bit shocking, but it means that the, that you'll be left behind. Absolutely. If you're not thinking about how to responsibly integrate user behavior data into your client service approach.  Mitch: (06:15)So you're mentioning so many buzz words that we talk about with within our industry. You know, we're always looking to turn insight into foresight and make sure that everyone's on the same page as far as awareness and understanding through storytelling. So I think this is fantastic. And along the lines of this digital transformation, you said all this data might actually be a pain point for certain organizations. What else do you think certain organizations need to be aware of or contribute to the PR and the media that you're putting out there for them because of the technology?  Reed: (06:49)Well, I think that they have options. You know, on the one hand you've got, from a financial institution standpoint, a lot of these organizations, have very, very dated architecture. they can't necessarily aggregate data from one business segment and compare it against data from another business segment. So that's a huge pain point in terms of how do you just organize yourself and update your systems and structures so that you're collecting information and then you have the wherewithal to be able to look at the information, in a reasonable context. So we are now thinking about, okay, what are the options available to you? You could think about working with an outside, data analyst or data scientist or even a communications firm where we spend a ton of time conducting research into audience behavior. I tried to understand what their greatest needs are to then kind of provide a recommended, an informed communication program about how to actually meet those needs, but the other thing that is particularly interesting to me is that you're now seeing a much bigger demand for personalization, that is driving what we're referring to and what's commonly known. I think in industry lingo is intimacy of scale. as professionals, we're now in a world where intimacy of scale is possible and, and frankly expected based on kind of the data points I just mentioned. I can give you an example of, of what I mean at bliss, we're often asked to think about building marketing programs that target women or employees or accountants. heading, most of us intuitively know just as humans, that looking at one of those terms is a totally inappropriate way to classify an audience. So depending on where someone lives their age, whether they're early career or seasoned professional, their work environment, personal experiences, all of that information, it means one message that works for one person, will resonate completely differently or not at all with another. So the biggest mistake I see when organizations let one single variable dictate, or become the driving force behind major business or marketing decisions. And in order for you to create a truly meaningful engagement, you have to be thinking about dozens, if not hundreds of variables, which is a little doom and gloom. But I will say there's good news, you know, the rise of machine learning and artificial intelligence, which I know that you talk about a lot on this podcast, it's becoming much easier for companies to actually deliver a personal experience. which by the way does not have to be big and audacious in order to be effective.  Mitch: (09:41)Well, I think that's a great segue and you're right, we do talk about all of this very frequently. And I guess the last question I have is in order to take advantage of all the opportunity that you discussed and maybe not be so doom and gloom like you just said with some of the information, what advice or recommendations do you have for these listeners in accounting and finance or maybe those who work for organizations in financial services, what can they do as far as, making your job easier so that you can help their organization succeed?  Reed: (10:14)Well, I think the one most foundational, piece of advice that I would share is to know your audience. I think too often we see organizations focused exclusively on solving a business need without considering whether that business need corresponds with a very real issue for their clients or their prospects. and I think when we talk about marketing, whether you're working on developing your personal brand or helping to make connections across your organization or even serving as an ambassador for, your firm, you have to ask yourself, who am I talking to and what's keeping them up at night? And that needs to be the starting point for any next step. I will say, you know, the second piece which we've talked about a lot today is just managing data successfully. I think your ability to access and parse through data will inform how you will advise and communicate and develop the bespoke experiences that your kind of ideal segment of one is looking for. Which means for it from a practical standpoint, having a great CRM in place and understanding how to use it, is table stakes. Now I know a lot of people are sort of adverse to new platforms and there's always a learning curve with it. But you have to do it. and you have to kind of always think about how you can use that information to then communicate properly. and I will say the third piece is to invest in content. I think at the of the day the thing that's going to differentiate firms and the people who will rise to the top are the ones who are providing that insight and that foresight, that you mentioned, particularly if they can answer the question, does my content offer value? Is it useful or am I just pushing a product or I just pushing a specific service offering. how can I actually provide that kind of one two punch where you're offering customer centric content that's at the right time and the right channel and you're still moving the needle for your firm's bottom line.  Mitch: (12:29)There's so much transferability here. So thank you very much for your perspective and all this information. I just want to give you an opportunity. Are there any last thoughts or comments you'd like to make before we wrap this up?  Reed: (12:41)Well, thank you for having me. I really appreciate it. I think the one, kind of final thought I'll leave is that, you know, you have to always remember to be human. So all of these items that we're talking about are intended to be tools in your arsenal that allow you as an individual and then as broader organization to think about what's the most strategic insight that I can offer that's going to demonstrate the value that I can provide above and beyond what's part of my job description. I think that's how people will continue to rise above the top. And frankly that's how we'll see which firms are going to be more successful, in the long haul.  Announcer: (13:23)This has been Count me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

MaryBeth's Links:Website: http://www.sparkvisionnow.com LinkedIn: https://www.linkedin.com/in/marybethhyland/Events: http://www.sparkvisionnow.com/events/FULL EPISODE TRANSCRIPTAdam: (00:00)Welcome back for episode 47 of Count Me In. I'm your host, Adam Larson and today's conversation features Mary Beth Hyland the founder and chief visionary for spark vision. Mary Beth talks to Mitch about the different strategies she implements to help organizations identify and close the gap between their current and ideal culture. Let's tune in now to hear her perspective on a healthy and thriving culture and what leaders can do to create and sustain these values and behaviors.  Mitch: (00:38)What is organizational culture to you and why do you believe that so important?  MaryBeth: (00:43)Organizational culture is such a complicated thing, but the way that I think about it is basically how things are done around here. So when people talk about their company, it sort of those norms and behaviors, the rituals and routines, what are the expectations that people have? It's also thinking about what is the emotional experience within your company. So how do you feel before you get to work while you're at work and after you leave? It was quite a dynamic thing to think about, sort of a short definition of what organizational culture is. but the way that I've sort of distilled it for the work that I do is I think about it in a formula. The formula that I use is values times, behavior equals culture, so that can take a lot of this intangible and start to make it feel like you can actually pinned some pieces of culture down. When you're thinking about values and you're thinking about behaviors and the reason that this is so incredibly important it is because it's ultimately going to greatly impact the way that people are engaged in their work, the productivity within your teams and your office overall, the loyalty that people have within the organization and ultimately how people feel their health is directly connected to an organization's culture as well. So investing in your company's culture and being intentional about really getting clear on what that definition means to that specific institution or organization, why it matters to them as as a company at large and as the individuals that make up that company, it's really critical in being able to create environments where people can thrive. My job as a workplace culture consultant is most of the time coming in and just being a really effective listener. Because the reality is the people who work there, they know exactly, exactly, exactly what they like to see change. They might not know what the solution is for that change, but they understand what the pain points are and they understand what's going well. So being able to identify not just where things need to shift, but wow, we're really effective when it comes to fill in the blank. So let's just say communication. So how can we make that even stronger and make that proven practice really go out deeper within the company.  Mitch: (03:15)So in your current role, you know, I'd like to go back to kind of what you were just talking about is being a good listener and while you're listening, and I'm assuming you watch the organization as well, what is it that really sticks out to you when you're looking at a healthy and thriving culture? What does that look like and how, have you ever worked with an accounting or finance organization that you knew just by looking and listening that things were going well?  MaryBeth: (03:40)Yeah, it's such an interesting question because every time I go into a company irregardless of the industry or the size or anything like that, everybody always seems to believe that what's going on there is really unique. And it's something that I probably have never experienced before and haven't seen before. So a lot of times when a company is thriving and doing really well, and this goes the same way, if you think about it in the opposite terms of they're not, so oftentimes these things aren't present, but when these things are present, it's apparent that things are, there's not as much of a lift as far as what are some intentional shifts that can be made for how people feel like they can thrive in that environment. So things like communication that is huge. It's amazing how many organizations, I believe that they're transparent and perhaps even have a value of transparency, but are making humongous decisions for the organization that directly impact the people who are going to be implementing that work and never involve them in the process or even loop them in to that as something that's happening. So communication is one of the key pillars to having, a culture where there's loyalty and trust. And those are also huge component. So, right, the trust factor is directly a dotted line connection to, to the communication, but really having people say what they mean and mean what they stay and then following through on those things. So there's this excellent book called the speed of trust, that really talks about how we have these, investments in trust that we're constantly making these small deposits of trust. And then another, another part is, is an organic goes directly connected. So dot line and even a hard line connected to trusting communication is being able to have to may feedback, being able to have conversations where people are able to bring to the table where their frustrations are, where they feel like change is necessary and have it received an open mind versus a, this is how it's always been done. Just get with the program or get outta here.  Mitch: (06:06)My next question is going to kind of build off of what you were just talking about and combined two different ideas here. So as we're looking to build or you know, see this thriving culture, what can leaders do, whether it's top down or bottom up, when the vision, their behavior is in line with the culture they want, but maybe there's others in the organization that just aren't buying in and they really want them to it's not just to get out, but what can they do to make sure that everybody involved in the organization is behaving in that way and ultimately, you know, will enable the organization to sustain this cultural success and their strategy for the future?  MaryBeth: (06:51)Well, I have a a little bit of a clarifying question for you before I answer because there is, it is, there is a differentiator between people who just aren't bought in and people who are toxic. So I'm happy to answer both. What I'd love to know if you're interested in a specific, you know, somebody who just sort of needs to be convinced versus someone who's creating extremely negative experiences in the workplace.  Mitch: (07:16)Very fair question and good point. I'm really more interested in the individual who maybe isn't fully bought in, in my opinion, if somebody were toxic, as you said earlier, it's kind of like, you know, jump on board or this isn't the right position for you. But if somebody is doing their work and maybe they're just not fully bought into the culture that somebody is trying to establish, how can you lead that person in the right direction so the organization goes in the right direction?  MaryBeth: (07:42)That's a great question. And I will say that being that this is what I do day in and day out, that is always the case. If you go into an organization that has more than five employees, there are going to be folks who don't understand why this matters. There's going to be folks who don't understand why this shouldn't be something that's invested in. And there are certainly going to be folks who aren't on board and take a little more time to get them to sort of it create that breadcrumb trail to help them know that this is powerful and meaningful. So there's a, there's several ways. So it really depends on your audience. One of the ways, and particularly for this industry, one of the ways that can be really effective is looking at what is the cost of having a culture that's thriving versus having a culture that's floundering. And so you can look at it from more of an analytical data driven perspective, if that is what sort of is the hangup of the initial mindset. So you can look at things like your turnover rate, what does it cost you to onboard a new person, right? All the training, all of the time, everything you're invested in, bringing new people in. What is it taking your team? as far as their energy and their time when it comes to things that are just not working well in the culture. So when we go back to things like communication, so what is it costing you guys or the whole institution at large, when people aren't on the same page, how much time is that and what is the breakdown of that time when it comes to dollars? And so oftentimes with folks who aren't onboard with the emotional aspect of the rewards and value of getting people engaged in understanding the impact of that with productivity and loyalty and all the things I mentioned when we started the conversation, you can get it down to dollars and cents and that can be sometimes the most effective starting point. Now if folks are in that bucket and they don't need to see the dollar and cents. They just need to understand like, why does this even matter in the first place? What I will do is talk to people about really getting in touch with them themselves from an emotional level and starting to do some more reflections in their own lives of environments where they felt like they wanted to be and environments where it was a painful experience to be in and having them kind of drop into more of that heart-centered space, more of that intuitive space within themselves because everybody knows everybody has had an experience where they felt like they belonged somewhere where they felt like they had some kind of intention or purpose and connection. What did that was at work or within their communities or in their families or elsewhere, and then everybody has had some kind of experience where it's they felt the opposite and if you can walk people through that from more of an emotional knowing, a more of an emotional understanding, people can start to make the connection that that's not separate or in a different category simply because it's a workplace and how much more we will get from folks feeling a sense of belonging, feeling that connection and knowing that they're ultimately going to be the greatest advocates for your organization because simply there way of engaging in their energy, right? We do so much advocating or talking against our organizations when simply like on the weekends, right? Or at night when we come home from work and we debrief on how our days were or people ask us what's going on and those things have a significant impact. They have a significant impact. It's not just what's happening when you're there in the nine to or the six to eight or whatever hours it is that folks are working because people know. People actually deeply know that this is important. It's just getting them to a place of recognizing and reminding them of that knowing.  Announcer: (12:11)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you liked what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Larry's Resources: Key Principles of Effective Financial Planning and Analysis: https://www.imanet.org/insights-and-trends/planning-and-analysis/key-principles-of-effective-financial-planning-and-analysis The 12 Principles of Best Practice FP&A: https://sfmagazine.com/post-entry/november-2017-12-principles-of-best-practice-fpa/ The People Side of FP&A: https://sfmagazine.com/post-entry/july-2019-the-people-side-of-fpa/ FULL EPISODE TRANSCRIPTMitch: (00:05)Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong. And today's conversation is between my co-host Adam Larson and our guest Larry Serven. Larry talked to Adam about strategy, execution, the role of the finance team, and creating long-term value and how companies can better align their strategy with their actions. So now here's episode 46 of count me in.  Adam: (00:36)So, Larry, what is meant by strategy execution and why is it important for creating long-term value?  Larry: (00:43)Well, you know, when you think about it, strategy execution is really about turning plans in a reality, making them happen. You know, actually doing what you said you were going to do. You know, I like to use analogies because you know, I personally find them helpful. So, I imagine I have a goal to lose 10 pounds. That's great. And I have a strategy and my strategy is to exercise more and eat less. That's a good strategy, you know, that's terrific. But what ultimately counts is whether or not I effectively execute that strategy in and lose the weight. Right? So personally, I would take a mediocre strategy that's been well executed over a great strategy, poorly executed, and I would do that any day of the week. And frankly, so will most investors. I started my career at Pepsi Cola international and that's a company that really prides itself on execution and they kind of have to the beverage industry is highly competitive and to survive you really need to be you know, you have to have a great strategy, but you also have to have world class execution. So, Pepsi actually paid a wall street firm to come in and determine the value of effective execution on the stock price. Now there's a whole back story to that I could go into if we had more time. But they concluded that predictability of earnings accounted for close to four points of the price earnings ratio. And that translates into about $50 billion in market cap. So, for Pepsi consistently executing strategy was worth about $50 billion. And since all the executives held stock in the company, you know, the value wasn't some abstraction. it was real money in your wallet. So, if you're a public company, then strategy execution is worth a whole lot. But you know, even if you're privately held, an effective strategy can be very valuable when meeting loan covenants, dealing with bankers. But I think even more to the point strategy execution means you're hitting your goals, achieving what you set out to achieve. And that's what every CEO and CFO wants. And it's, you know, what they get paid to do.  Adam: (03:16)So of course, every company wants their strategy to be executed perfectly. But why do they typically fail?  Larry: (03:27)Well, keep in mind the really four fundamental things necessary to execute a strategy assuming of course you have one to begin with. first people need to know what it is they need to do. Second, they need the proper resources to get it done. Third, they need some motivation to get them done. And finally, there needs to be transparency. Transparency in the goals and objectives, transparency and reporting, the actual results also transparency in the progress that's being made. So, for many organizations one or more, or sometimes all four of those fundamentals are missing. And you know that's obviously a problem or that's obviously a problem, but equally fundamental, there needs to be perfect alignment between all four, but more commonly they're disjointed. they all exist in some form, but they're not integrated in, they're not reinforcing. So, you know, for example the strategy calls for the company to focus on innovation to increase market share and revenue, but it never actually gets translated in concrete terms into an operating plan or the budget process. which is where the real allocation of resources happens. It doesn't actually reflect the strategy. You know, I had a CEO tell me you know, just last week about his frustration, you know, spending three days in an executive retreat that define the strategy and specific initiatives to execute it. He said, the session couldn't have gone any better. Everyone was really excited. You know, they had a real plan. But three months later when they were, you know, in the budgeting cycle, he was presented with a budget P and L and he has a seemingly very simple question where's the strategy and all this. And all he got was blank stares. People hadn't actually thought through what resources they needed to properly execute the strategic initiatives that they committed to, or in some cases they had, but it was done very quickly with the back of their left hand. And it wasn't worth the paper it was printed on and then, you know, you think about incentive compensation, you should be able to ask anyone what their goals are and see how they reflect the execution of the strategy. And I think we're going to be talking about a case study a little bit later on. And I think there's actually a good example there. But you know, for many companies you'd be hard pressed to see a clear line of sight between an individual's incentive comp and the strategy. You know, I could go on with, with other examples. But when you think about all four requirements being in place and actually well aligned, it's frankly not surprising that most companies struggle with strategy execution.  Adam: (06:35)So, what if you're listening to this podcast and this is the first time you've heard these four elements mentioned at the same time and executing strategy, how would one go about identifying which one they're missing?  Larry: (06:46)Oh, that is a great question. the practical advice here, and I'm big on practical advice, is map out today your processes from strategy, right through budgeting through the reporting of, of actuals your compensation. incentive compensation. We map it all out, put it down on paper, not the way you think it should exist in the future, but the way it actually exists today and those missing pieces of the puzzle, those disconnects are going to pop right off the page when you do that. So, the advice to get started is map it all out today and you're going to see where the disconnects are.  Adam: (07:37)That's some great practical advice, Larry. So, what role does the CFO and FP&A have in general in general have in strategy execution?  Larry: (07:50)Well, you know, what you think about it, a finances role is to co-create and then orchestrate the management system that takes you from strategy through execution. So if we go back to those four fundamentals, when we say people need to know what it is, is they need to do what it is they need to accomplish, well, that's all about planning, setting goals, developing plans to achieve them. Finance needs to co-create, manage an effective planning process. the second point, you know, we've said organizations need proper resources to get it done. Again, that's, that's part of the budget process. and that budget process is one that that finance typically orchestrates and managers we said organizations need proper motivation. And you know, frankly, that's more in the domain of HR and, you know, compensation analysts. But when we get to the case study, we'll actually see how finance played a very critical role in that and then finally, number four we talked about the need for transparency, transparency in the results, but also transparency and progress that's being made on various projects that are meant to execute the strategy. And when you think about that, that's all about reporting and analysis. and not just financial figures but operational metrics, key performance indicators. So, you know, frankly, I think we could do an hour just on this one topic, but if we take a step back, maybe take a wide angle view, finances role, you know, broadly speaking is to be a partner in the business, which means going beyond the mechanics of what I just outlined and really helping the business make better decisions. And that means providing decision support, business, you know, insight throughout the entire process. last point and it relates to decision support. Finance's role is to work with it to make sure that, you know, they, those folks in finance and the rest of the organization, that they have the right data and the right systems in place. And that means, you know, having the right reporting and analysis tools along with the right planning, budgeting, forecasting tools, preferably all on the same platform for seamless integration. It's up to finance to take a step back, assess the current systems and needs versus what's really required and then work to close the gap.  Adam: (10:29)So then how can companies better align strategy and execution?  Larry: (10:35)Well, I do think this is best answered with a case study which I know we're getting to, but you know, think through all the actual mechanisms to build the strategy through execution bridge. For example, let's say a company's strategy is built around innovation. That's the key to success. Well, that's great, but how are they going to measure innovation? You know, that measurement is the practical mechanism to begin to operationalize the strategy. So, let's say they come up with this measurement for innovation. You say innovations, the percent of sales coming from products introduced in the last two years. Okay. That's concrete. It's measurable. So, the next practical mechanism is to set a goal for that, both a long-term goal and one for next year. Of course, you know, you want to understand where they are today on that measure historically where they've been in order to establish the right targets. Finance can really provide some great decision support there. And then once the targets have been established, the next practical mechanism is to define strategic initiatives to achieve the long-term goals and more specific projects to be executed in the upcoming year. The next practical mechanism to define the resources, time and money to execute those projects and get those resources actually into the budget. you know, there, there's a lot more to it but, but notice how now we have practical mechanisms that actually link strategic planning all the way down to budgeting. And that's not the end. Of course, we still need to reflect, you know, execution of projects and their targets that they're intended to achieve and new incentive compensation. But notice that that connection is now easier to make and it's more concrete. It's easier to connect the dots. we also need to set up the right ongoing reporting mechanisms, including the, the progress report on key initiatives. So, we just don't wait until the end of the year to see if they happen or not. Now you might actually disagree with some of this, but don't lose sight of the bigger message, you know, whether these, you know, mechanisms are the ones that, that you want to put in place or you've got your own ideas, you need concrete. This is how each connection is going to be made. And if you can't define those mechanisms, I'll guarantee won't execute your strategy.  Adam: (13:09)So now we've been mentioning case study throughout this whole conversation. Larry, could you give us some more details on how the case study might illuminate some of what we've already discussed?  Larry: (13:19)Yup, happy to. The case study I'd like to cover relates to a leading waste and environmental services company in North America. And let me say at the outset of this deserves its own workshop, but I'll cover the highlights here. So, this company measured their financial results consistent with gap reporting, but they focused their attention on what they called the sales ratio, which is earnings before interest, taxes, amortization or EBDTA divided by sales. They call that the sales ratio. So long story short, they set a goal of doubling that key measure in five years. Everything they did to achieve that interest fee to begin with, they developed a strategy grounded in what isn't going to change over the next 10 years. incidentally, they're not alone in that Jeff Bezos credits Amazon's success in out executing their competition on those things that consumers will still want in the foreseeable future, like faster delivery or order accuracy. So, for this environment services company, one of the drivers of success is customer profitability, which is driven by cost to serve. So, they established a KPI or key performance indicator tree diagram, which broke down all their costs and what drove those costs. So, for example, they broke down maintenance costs per mile and a things like tire costs per mile. And then they set improvement targets for all those measures and end gave incentives up and down the organization to move those figures in the right direction. For example, the maintenance team figured out that proper air pressure could actually extend the life of tires and reduce tire replacement costs. So, they took it upon themselves to measure tire pressure every day and adjust as they need it. And I realize that might sound like a really small thing, but it's the front lines where strategy actually gets executed or fails to get executed. But I also so like that because it illustrates that the strategy and the goals were aligning top to bottom throughout the entire organization. And now here's where things really got interesting that the finance team did a study around customer density. In other words, how close or far apart the customers were. Now that matters because the closer the customers are, the less driving time is needed to serve them. Right? So, finance worked with operations on a linear programming project to identify the optimal routes and that project paid off big time, but then they did something that finance teams almost never do. Working together with the VP of sales, they looked at sales and how people were being compensated. It turns out there was no incentive to sell prospects that were already close to existing customers. So, salespeople were selling in a way that led to longer routes and higher cost per mile to serve, not intentionally, of course, they just didn't have the incentive to do it any other way. So, after careful analysis and study, the sales compensation plan was actually changed and it resulted in a much improved customer density, much lower costs per minute to serve. So, the result of everything I just talked about and a little bit more is that the company actually did achieve their goal of doubling the sales ratio. Only the achieved it two years early. So, you know, if you were paying attention, finance was part of all four pillars of strategy execution. And that's why I really liked this illustration.  Adam: (17:09)I think that's a wonderful illustration. It's very practical. It illuminates the fact that strategy can't just happen in a board room. It can't just happen behind closed doors that you actually have to look at the front lines and look at all aspects of the business and how, and finance is a huge important part of all of those aspects as you go along.  Larry: (17:28)Yeah, absolutely. And you know, sometimes the company's strategy will call for what I call, you know, big bang. You know, they're going to divest, you know, whole business units or you know, they're going to go on a acquisition a spree and, and that's fine. But you know, Wall Street investors tend to be focused more on organic growth and organic improvement. and you know, that's where what happens on the front lines every day really matters. And that's where your strategy is really being executed or, or you know, you're going to have a failure to execute. Larry, when you first started talking about the case study, you mentioned a workshop. Could you tell us a bit more about that? Yeah, it'd be happy to. So we have a workshop that helps companies sort of identify this whole strategy through execution bridge and some you know, practical steps that they can, they can take to improve strategy execution. and it covers, you know, a lot of what we were just talking about but in more detail. And if folks have an interest in that, they're, they're more than welcome to contact me.  Announcer: (18:51)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Anders: https://www.linkedin.com/in/andersliulindberg/Additional Resources from Anders: Link to book: https://www.amazon.co.uk/Create-value-Finance-Business-Partner/dp/1724850741 Link to the ebook: http://businesspartneringinstitute.org/sign-up-to-our-newsletter/ Link to blog: https://www.linkedin.com/in/andersliulindberg/detail/recent-activity/posts/ FULL EPISODE TRANSCRIPTAdam: (00:05)Hey everyone, thanks for coming back for episode 45 of Count Me In. Our featured guests for today's conversation joined us from Denmark as Anders Liu-Lindberg spoke with Mitch about the popular topic of business partnering. My favorite part of the conversation was Anders simple and clear equation. Insight times influence equals impact. Let's listen in for more valuable insight and hear what else Anders has to offer.  Mitch: (00:34)Recently we've heard a lot about the term business partnering. So in your perspective, what is business partnering?  Anders: (00:42)Thanks for asking that question. And I agree that a lot more posts than information is coming out about business partnering these years. But for me it's, it's really quite simple. Business partnering is insights times influence equals impact. What I mean with that, I mean, you've got to have some insights then you can share with business leaders that can improve that decisions. but You gotta be able to influence that decisions before you can improve that decisions? So if you insights and could influence decision making, you have impact. You have the ability to change business decisions, ideally for the better. Let me, let me try and break it further down. So what is insights? Insights is when you bring something new to business leaders that one, they didn't know and two, will help them make better decisions is if all you bring to them as information that they know already nice, but it doesn't help them and to what you bring to them as somebody they don't know but doesn't help him. It's even worse actually because you take away capacity from them to focus on making better decisions. and insights can come in really three broad, broad categories. There's the operator role, we optimize processes to drive efficiencies in both the finance function but also in business operations. Then there's the controller role, which is where we managed risks, which all the numbers and with you, who is this performance to see how things are going. Then there's the advisor role or recovery, new insights and perspectives that can help the business grow. That's really what insight is all about. And that of course means it can be lots of different things as long as it satisfies the first two criteria. You don't know it, but it can help make better decisions. How influencing is then more the secret sauce to this because I think finance professionals have been turning our insights for years, but maybe not gotten too far with it. You need influence to go the full mile. What does influence is about being customer centric or focus on your internal stakeholders and build trusted relationships with them? I said, if they don't trust you, it doesn't matter what you bring to them. It's about understanding the industry that you're a part of and your specific business. And if you don't understand the business, it is also hard for them to trust you and feel that you have something valuable to say. And last but not least, you gotta be assertive and communicate with impact. If you cannot communicate the result of your findings in a language that they understand, you're not getting very far with the insights either. But if you could do all of that, then you can have impact, can ensure better and more profitable business decisions. You can drag performance by tuning all these insights into action. So that's to me what, what business partnering is all about.  Mitch: (03:27)I think that's a great explanation and I really, appreciate your detail and explaining it all. So a lot of our accounting and finance listeners, they are hearing regularly about how they have to become business partners. Right. And with the explanation you just provided, what kind of, you know, advice would you give our listeners for becoming business partners or, you know, how do you get more time in that role to really secure their position in the organization?  Anders: (03:56)Yeah, so I think the first day was really making a personal choice to step outside your comfort zone. There's many finance and accounting professionals, they have a comfort zone that starts and ends with their desk in front of their Excel sheet or that BI tool, right? I mean, that might be a bit black and white and maybe it's not exactly like that, but I think many, many finance professionals can relate to the fact that every time they had to go talk to someone else, it's feels a bit uncomfortable. Especially if that someone else is outside of the finance function. So I at least from personal experience, if I go back five, 10 years, I feel that. And to some extent I still feel it today, but I've made a choice long ago to step outside my comfort zone and go where business partnering happens, which is together with other people together with, with business leaders and other other business stakeholders. So thing. That's really the first step because if you make that choice and you say, I'm going to stay out of my comfort zone and try to go do these things, everything becomes easier from there. I was saying it gets more comfortable right away over time. It will. Yeah, but that's what you need to do and yes, you will fail quite a few times probably before you succeed, but Hey, that's, you know, that's the new mantra these days, right? Fail fast to succeed sooner. So I think that's really key here. Then we can talk about all the skills that you need, you know be storyteller, communicate better, how to build relationships, understand other's perspectives and so forth. That is also hugely important. But we start with making that choice.  Mitch: (05:31)So what if our listeners are, you know, an accounting and finance professional is able to step out of their comfort zone. They take this first step, how do they measure their impact? You know, how can they actually become that business partner? When can they appreciate taking on this new responsibility?  Anders: (05:48)Yeah. So if you talk about measure impact as a business partner, I think there are, there are three things that you can look at. The first thing is does the business that you support deliver better results? Do the meet of beat the targets that we've set for them. So that's, that's one, right? That gotta be some sort of a business impact value creation part in them too The second is do the business leaders or the business stakeholders, internal customers call them what you want. Do they feel like that you actually helping them achieve these results or are they're thinking, Hey, you know, it's great you're there to your business partner. But hey you're not helping me and it's me and my team that are driving these facades, right? Because if they think you are helping them and you're delivering better business results, then to me you have an impact as a business. Then you can always ask. The third step is to say, okay well I'm going to try and go even further document my impact as a business partner. So you do some value cases where you work specific problems or challenges that the business is facing and together with them you come up with solutions that changed behavior and drives better business results and that you can document more clearly on some more one off cases. So I think those are three of the main things you can do to document your impact as a business partner and feel like you are creating value and I feel like actually the second piece where the stakeholder says, okay, yes, my business partner is helping me deliver these results. It's the key step yet. Right? Because then you'd get the recognition from the business decor that you've actually done business poverty. The guy was able to deliver the results that the business wanted or not. You've done business partnering. So to me that is the the most important recognition together.  Mitch: (07:30)You said earlier, it's important to fail fast in order to succeed earlier. And you also just mentioned you may go to certain stakeholders and they may say, you know, your information is not helping me. So what can an individual do to learn and develop in order to make sure that the insights that they're trying to provide actually are helpful to those who they want to partner with?  Anders: (07:53)Yeah, so I think there's a, there's a pretty simple model that you can try to utilize for this. We call it the NASA, so need, acceptance, solution, acceptance. So first you got to identify the needs of your customers. Sometimes they will tell you directly, sometimes you will overhear them in a conversation talking about some of the challenges. And at other times you, you sometimes have to guess a bit to say, okay, I have a thing that they probably need this. Right? Then you go and bring a proposal for what you want to do to them and say, well I have understood your need like this. So if I do, like if I do these things, would that help you solve this issue? So we get acceptance that these are the needs that they're looking to have solved. Once you have this acceptance, you started working on the solution and it's not just work two months on a solution, then I showed in one go, well you probably check in with them along the way to make sure you're on the right track. When you develop the solution, then you present it for final decision and guess the acceptance again that this is the solution they want to go for. So I think it's a simple force, that nead acceptance, solution, acceptance, then then you can sort of work in a more structured way with your business, big holders to, to solve the challenges that they're facing.  Mitch: (09:05)I love that acronym. I think that's very clear and very specific as to what an individual can do. So thank you for sharing that. Also, you know, we kind of kicked this off by saying business partnering with something that was new. You know, it was almost revolutionary for the finance role and in what you're trying to aspire to. Right. Based on the changes in the industry. So in your opinion, you know, as everyone aspires to be these business partners, what do you kind of see is coming next in the finance and accounting industry? What do you anticipate coming for the future of all of our listeners right now?  Anders: (09:39)Yeah, so, so I think, you know, business partnering, it's been around for for 20 years as a concept that, you know, some say that I've been doing business partnering like, like forever. So in some ways it's not really a new concept. But, I think what's, what's new is, is one that one more companies are realizing that this is what they need to do, do to be successful in the future as a finance function. And also more and more companies actually able to succeed with this. Right? Because if I look at myself, we've been trying to succeed with business partners for many years, let's say 10 or even more years. What struggled in the beginning because we were not yeah. About what is it really that business partner is not about what is business partnership do and we're clear about how do we ask you to succeed and create value. That is getting more and more clear now to most to most companies as we talk more about it. And we have frameworks like we were looking at first and night business I'm used to that I'm caught up. And then more companies also have the frameworks to say what does business partnering mean for them and what should people do and how do they create value? Okay. Those are sort of the two things that are more and more prevailing that you know, pushes the business partner moving even more, but it's not going away anytime soon. I think we'll would just see more and more of this in the future. What's happening also of course in the finance function is that the artificial intelligence, machine learning, automation, all these things. They are also driving, driving a second wave. And the second way was really that we need more insights to make better decisions. I have to optimize processes, we get all the data into a data Lake or something like that. And then we run some statistics or IP rhythms on and then become some sort of trends and patterns out of it. And now I think, I think we will get more and more that. and now that just means that there'll be a lot more insights that the business partners can bring to their stakeholders. So I don't think we should expect any revolutionary things coming anytime soon in the future. We're publishing more and better off the same, but the emphasis on business partner will just be more and more and more. Whereas the emphasis on machine learning and artificial, all that stuff, it's really high at the moment. I don't think there's any finance function that is not thinking about how can we utilize this to our advantage. But many of them are not really realizing that. Okay. So once you have it, then what? Then you need a business partner that can take all that information and go to the business and figure out how do we use this to make better decisions. So I think we'll just see the current trends he magnified even more. And business partnering will be what most finest functions and finders and accounting professionals need to really step up to succeed in the future.  Announcer: (12:31)This has been Count Me In, podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Sarah:  https://www.linkedin.com/in/sarahelliottcpaacc/ https://twitter.com/selliott99 About Sarah: https://www.intend2lead.com/sarah-elliott/Intend2Lead: https://www.intend2lead.com/Sarah's favorite quote: “As we let our own light shine, we unconsciously give other people permission to do the same. As we are liberated from our own fear, our presence automatically liberates others.” – Marianne WilliamsonFULL EPISODE TRANSCRIPTMitch: (00:05)We are back with Episode 44 of Count Me In, IMA's podcast about all things affecting the accounting and finance world. Our conversation for today is between Adam and special guest, Sarah Elliott. Sarah talks to us about how her accounting background and skills enabled her to start and run multiple businesses, and she really emphasizes the importance of leadership. Let's go over to the conversation now. Adam: (00:33)So Sarah, can you please tell us a little bit about your accounting experience? Sarah: (00:38)Of course. So I am a CPA and I practiced in public accounting for 14 years in the audit space. So I spent 10 years at big four. I worked for PWC. Eight of those years were in Austin, Texas, which is where I am now. They had some really great experiences and challenges that PWC, I feel like somehow I worked on a lot of engagements where the company was restating which made things extra interesting and challenging. And so I just really got to learn a lot, love digging into the messiness of some of those things and making it through it. A couple of years later when it was time for me to become an equity partner, actually instead chose to take a leap of faith to start my own business because I had learned more about myself and I knew I wanted to make a bigger impact in the accounting profession. Then just one from, I really wanted to expand the impact to the profession as a whole. So I took that leap of faith in 2014 and I was five months pregnant at the time. So it was scary and exhilarating and fun. And I, I'm somehow here to tell the tale. Adam: (01:56)So, you know, you've mentioned that you started your own business you know, you, you've started elevate and ultimately intend to lead. Can you tell us like what contributed to wanting to start those and then what areas of interest of yours spark those spark the initiatives? Sarah: (02:12)Sure. So it's a, it's a bit of a convoluted story how all this came to be. So the, the short answer is both businesses are something that I wished I had had for myself at a point earlier in my own journey. So I saw a need. It was a need I had in me and I thought, wow, I really want to give this back to others. So the longer answer, and by the way, there's been a lot of twists and turns with elevate, so it feels stick with me. You'll see it's kind of an interesting story and I think as an entrepreneur it's not all that uncommon that we end up in a place where we didn't see setting out. We're really just figuring out as go. So initially right when I was in the practice of accounting, I had done some volunteerism through the AICPA on a couple of task forces. And my work there helps me see that there was a real need for leadership development in this profession. I saw the challenges that were not just at my firm, that they were the same as the entire profession. And so I started to see that there was alignment in our leadership challenges with my own gifts and my own passion. So that really inspired me to take that leap of faith, right, to leave the firm and the career that I had built in the security of that to really make a bigger impact on my own. So the first business I started was actually, it was called elevate advisors back then. And my intention was to provide strategic consulting services to the profession in leadership development. And I was five months pregnant, if you'll remember. So I had about four months of a runway before I had my kiddo. And what was interesting was in those four months, it's more of a generalist consultant, I realized that there was really more that I wanted to bring. I wanted to bring that magic of coaching, which had such a profound impact for me. I wanted to bring that to the accounting profession. So I made a decision in December of 2014 when I was nine months pregnant, about to pause, to go back to school for my coaching certification. So I went back to school for a year a couple of months after that when my baby was, I think he was about eight weeks old at the time. And then I rebranded elevate advisers to elevate coaching. And my focus at that time was really on coaching women in the profession because I really believe that we need more women leadership in this profession. We need more diversity and women leaders have so much to offer the profession what we really need right now. And I think women bring a really strong different type of leadership to this profession. We're really human side of leadership, collaboration, empathy, compassion, inclusion, creativity, and really need more of that. We need more balance in this profession. So I was focused on coaching for women in accounting [inaudible] then I met Brian Kush, who's my amazing partner for intend to lead. So I met him in the fall of 2015, you know, another coach, another CPA who had turned into a coach. But he was a few years ahead on his journey than where I was. And so a mutual friend said, Oh, you two need to meet. We met via phone. We instantly connected. We shared the same values and vision or innovating leadership development in the profession and for bringing the magic of coaching right to accounting.  Adam: (05:54)So since this is a podcast for accountants, I have to ask, how did your accounting background help in starting and efficiently operating each of these businesses that you've just described? For us? Sarah: (06:06)I said, it's an interesting question because some obvious things come to mind, which is being good with numbers is great when it comes to running a business, right? So right from the start I knew how to create a budget, how to set goals, right and, and revenue goals, then I could project what it would cost to deliver a project and what cashflow needs I had. So those things just came to me. Second nature, a lot of things that I think accountants take for granted that much of the world is not adept with. And, and the work in audit is, well, it's just given me a lot of exposure to business things. So entity formation at contracts, how to write and use a contract. What payment terms you want with your customers, right? To make sure you can manage cash flows. So those are some of the obvious things that are helpful and necessary to run a sustainable business. And then I think there were less obvious things that really support entrepreneurship. So I was an auditor for 14 years and I worked with a lot of different businesses. So I have an innate knowledge through that experience of how business works beyond just the numbers because you're always learning what is the business to do, right? What is their model? And I learned a lot about what works and what doesn't work. So when you work with companies for a few years, you see the good, the bad, and the ugly. What makes the business really great and what actually makes businesses fail. Okay. And then because of the work, I was in a neat accounting in an accounting firm, I was pretty well connected in the business community. I got to know, a lot of business people, business owners, and I learned so much just from listening to their journeys. Certainly the things that had worked out well for them, but also what they struggled with. So I was just soaking it in like a sponge for all those years. And I don't even think I realized it really until you asked me this question. So, so yeah, I think in the world of accounting, we are gifted to just see that the inner workings of a business and we take that for granted. And what I see if you're working with some women entrepreneurs outside the accounting space through elevate, it's just, that's hard for a lot of people. I think we do have a leg up on entrepreneurship for sure. Adam: (08:42)Sounds like it. As you were talking, just came to mind, how important is listening when you're being an entrepreneur? Sarah: (08:53)Well, listening important, whether you're an entrepreneur or not, we actually, through intend to lead, we teach coaching skills. I mean, not only do we bring coaching to the profession, right, by delivering that, but we also teach people in the profession to use coaching skills and we teach people to use listening. That's a primary skill. So I, I say it's a success skill for any human being because that's how we learn, right? When we're able to let go of the voice in our head, that's always trying to respond or think about what's next in a conversation or thinking about what we're going to have for lunch after this or what's an art to do list, right? When we can actually be present with another person and listen and understand the meaning of what they are saying. There's so much that we'll learn that's incredible, right? We learn so much more when we let go of what we think we know, and just listen. Adam: (09:53)When we let go of the fact that, or are you accept the fact that you don't know everything and that you can actually learn something from each person that you meet, even somebody younger than you somebody who's just starting out and then going up to somebody who's been in the profession for a long time. You can learn from each person you encounter each day. Sarah: (10:12)Yes. That is the truth. Even someone that you don't agree with, even if they're saying something that you don't like, it has something to teach you if you're open to that. Adam: (10:22)So circling back to leadership, you know, why are leadership skills so important? And why should accountants continued to develop their leadership aptitude? Sarah: (10:33)Well, I believe that leadership is at the heart of everything. It's about how can I be a better human being? And at the end of the day, business just humans doing business with other humans, right? It's humans trying to help other humans in some way. So when we focus on leadership development, it helps us be better humans and the people that embrace the path of learning, that people that realize that we can always elevate our consciousness is a leader. These are the people who create meaningful success and contribute to the world in a bigger way. And that's what we need more of, right? Especially in the accounting profession. So if you just look at the profession where it is today and what's ahead of us, the pace of change is always accelerating. It's just getting faster and faster in every moment. So we've got to adapt. We've got to innovate, we need to create new ways of doing things, and we need to work together to do that. It's not just one person. We've got to collaborate, right? And we need diversity at the table to be able to truly innovate and create something new. And in the accounting profession specifically, we're seeing a shift from compliance to more of a consulting approach, right? Because a lot of the compliance, traditional work is being automated. So we've got to get comfortable as accountants with ambiguity, with the unknown, with looking forward instead of backwards. And I think the more that technology, is coming into the world, right and into business and automating so many things, it makes our human to human skills even more important. So our humanity matters most. And I think as human beings we're seeking more meaning and connection through our work and with one another. And the cool thing about coaching specifically is coaching provides meaning. It gives people that space to make meaning and it provides the opportunities to really understand other human beings. And so just coaching and leadership development as a whole, it's, it's just incredibly powerful and I think we really need it right now more than ever.  Adam: (12:51)Is there space to be vulnerable in the midst of a fast-changing business world? Sarah: (12:59)Not only is there a space to be vulnerable, I think it's required. I think in the fast paced right, this world that we live in and in this world where all of us human beings are seeking to connect with one another and to grow and to learn, we have to be okay being vulnerable and saying we don't know everything yet. And in fact, what connects us as human beings are often. The struggles that we share, right? And through the work that, that I am blessed to be able to do in coaching. That's how I get to see from people is, are deepest vulnerabilities. And the thing is, when you're willing to dig deep and be vulnerable and share those with someone, it gives you the opportunity to move through it and beyond it, right? And to elevate yourself is a leader in ways that you never could otherwise.  Announcer: (13:53)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Hiten: https://www.linkedin.com/in/hitenkeshave/"Defining a Successful Disruptive Leader": https://www.linkedin.com/pulse/defining-successful-disruptive-leader-hiten-keshave-ca-sa-mba/For more information, visit his website at www.theunconventionalca.com and subscribe to his newsletter. FULL EPISODE TRANSCRIPTAdam: (00:05)Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. Our guest for episode 43 is Hiten Keshave CFO, entrepreneur and established leader in finance. And it's conversation with Mitch, Hiten shares his perspective relating to automation, job creation, innovation, and the overall mindset of a successful finance leader. Let's hear his insights now.  Mitch: (00:33)So I know looking at your LinkedIn, one of the things you have in your title is mind shift leader. So in your opinion, when it comes to accounting and finance or just business in general, you know, how do we need to shift our mindset when it comes to artificial intelligence and the disruption that it has caused in accounting and finance.  Hiten: (00:52)The key aspect from a finance individual versus artificial intelligence. Now there's been a whole talk about it being a replacement of individuals and the current roles that people play. And so people are going to become obsolete in the work place. I don't think that's necessarily the case. What will actually happen is there will be a transition, the change of roles that individuals will play in business. The mindset will change to how am I going to stay relevant? What this transition of technology that comes in. And I use the example of, Excel, you know, and accounting back in those days, the general ledger is all done on paper. Those big 80 size books. And then, the introduction of, Excel came in and things just started to be done electronic, but the individual didn't become obsolete. All they did was they changed the skillset to become more relevant with time. So I think that mind shift aspect is, stay away from the negativity that, indulges around the environment and focus on well, how you can in and make yourself relevant.  Mitch: (02:08)Besides helping, you know, really in my opinion, I think the automation helps the accountant today. what other further positives do you think this automation, artificial intelligence, RPA has to offer to the profession?  Hiten: (02:24)Look, I think a RPA in itself is going to, besides efficiencies and productivity, it's going to come ultimately to a bigger business perspective from a decision making as big, you know, you will have information readily available for you to analyze, make better decisions from, look at analytics, you know, descriptive analytics, predictive analytics, using artificial intelligence based on historic data that's set in your, if you have a technology with old one to have a customer or revenue later data, you know, it extracts a extrapolate storage movement to use some prediction going forward. And you can then apply commercial acumen to that to say, you know what, okay fine, this is what's happened in the past. But going forward, things actually changing autonomy wise. So I think it's going to make businesses more proactive rather than reactive.  Mitch: (03:29)Well, I know making business more proactive and I told you before this call, I enjoy following you on LinkedIn and all your articles and posts. One of the things I saw was the “disruptive leader”. So is that something that you coined yourself or is that something you picked up from somebody?  Hiten: (03:47)I've tried to coin as many of these things myself, but there might be others who described the message in their own way.  Mitch: (03:56)Well, I think it's right in alignment with what you're talking about here and you know, being able to take these insights and lead the business through. So can you just kind of explain to our listeners here what you actually mean by a disruptive leader.  Hiten: (04:10)Look, in context to the AR, RP, RPA side? You know, I look at a disruptive leader, someone who's going to be visionary and old thinking, you know, someone who is going to look, you know, what can I do better going forward rather than, what is it that I need to do now? So thinking in the future rather than thinking in the present moment only. So, you know, often we get told to live in the present moment. But that's not only enough now with technology coming in and especially if you're a technology company, which is where I play, you know, we always have to think what is it that we can do better for clients in order to keep our business and product more relevant in that instance is do we have to introduce artificial intelligence in our own product itself that we deliver to our clients to make their lives easier and to make ourselves more relevant? You know, those are the type of aspects that, you need to look at it. So as a visionary leader, you need to look both internally but also externally in terms of delivery to your customers as well.  Mitch: (05:15)And now how does this, it kind of changed the benchmarks or the measure of success of the finance team when everything is not so internally focused and you know, looking at the right now, but more in the future, how do you measure that?  Hiten: (05:33)Look, I think there'll be certain basics that the finance team will still need to do deliver in terms of what they do today or where I think the key aspect will come in is what is finance now able to do with day financial data to make business decisions more effective from an operational aspect and a strategic aspect. How does a financial individual uses commercial acumen and strategic acumen, but improve a business other than being a backend office person, only be an office person who able to add very in a proactive manner in a strategic, a general of the business or in an operational one. So you know, there's this old term about finance business partnering. It's a big buzzword that's going around. Essentially the crux of it is don't sit on your laurels and only thinking of finance aspect. Start thinking broad based on a whole business perspective. And I look at it these, you know, if you're a CFO and you want to transition into a CEO role. You actually need to know your business holistically. And I think that's the role ultimately, that the CFO and the finance individuals will start playing.  Mitch: (06:55)So leading into my next question right there, I know, the role of the CFO has changed and there's a lot of talk about that. You mentioned business partnering. So in your terms, you know, who really is the modern CFO and what can we expect from that role to change even more as the industry continues to progress.  Hiten: (07:19)Okay. Your modern CFO for I would say is a copilot or a CEO or managing director over the business. Essentially that individual for me in the future or even currently needs to have a good understanding commercially of how business works and operation so that they can apply or provide the correct strategic guidance around decisions being made from a business perspective that have financial implications. And, I'll look at it, in the instance that from a process perspective, you know, technology is there to help enhance and, efficiencies and productivity in a business. Usually finance are the gatekeepers when it relates to implementing technology within a business, but for finance needs to understand this is not only a cost, the specter of what's the long term benefits and goals behind having such an implementation, you know, business intern. And in the same way, you know, from a product perspective if you're doing development on a technology product. You know finance guys always want to say, what's my ROI? How am I going to be making that money back? You know, from my client, which is the fair question. But at the same time, sometimes client retention, there's a massive pot from a bigger perspective and we need to understand that part of sales and marketing. Where does the client a relationship aspect put into play?  Mitch: (08:58)So I guess to wrap this conversation up, you know, how does all of this tie into personal or individual results? You know, how can somebody really, use what you've talked about so far today, start to develop their skills, prepare for the future, and ultimately be successful in business today?  Hiten: (09:19)Okay. I think individuals need to understand way the trend of the job profile that they want to see themselves playing in goals. So what is it currently, what it predicted to happen. So you're going to have to do some research, especially if you're young, you know, and you're getting into a finance field in itself. I look at a lot of guys that I mentored here locally who are CA's, a chartered account, in South Africa and a lot of them question and ask, you know, do I stay in the auditing field or do I go into a corporate world? What is it that's going to make me relevant to go into a corporate world? And a lot of that comes down to, I say you can't sit yourself into a traditional backend office role anymore. You need to start showing the necessary initiative. Having the right attitude become holistically involved in a business or wanting to learn and grow within a business and not just within a finance department itself. I think that's going to be the key outcome from individuals.  Mitch: (10:29)What do you attribute your learning curve to? You know, and as you were coming into a finance and where did you learn to come up with this kind of insight that you are now able to offer to mentees?  Hiten: (10:45)So look, when I qualified as a CA off to articles, I essentially started my own businesses and so I went the whole entrepreneurial route. So, basically dive into the deep end of a swimming pool and had sold myself out and understand what it is to make a business successful, running it from scratch. So I come with a finance background, but I don't come with, much commercial and, business acumen, you know. So I actually learned that the hard way and you know, after successfully selling businesses and relocating it to South Africa in Johannesburg, I got back into the corporate role. So I took that knowledge and I was able to get into a CFO role at a young age of 28, you know, in a global technology organization purely based on having gone to that whole journey of not only having stuck into the financial but being play, having played in the commercial and strategic roles as well. So that whole aspect as a driven my journey and my success will find my career.  Mitch: (12:00)And this is my last question, but what is it about finance that you, I believe really serves as a great foundation to enable somebody like yourself to just jump into some entrepreneurial endeavor and find the success. How does finance really support what you need to be successful in business?  Hiten: (12:20)You know, every decision you make in business ultimately as a financial impact, and that understanding that financial impact and how it's going to affect the future of your business is cool. I think that's the key fundamental decision, that or key fundamental character of being a financially finance individual with an entrepreneurial background, you know, that, is of a benefits. So you know, any individual who wants to venture out into that space, they take a lot of, knowledge with them in terms of being able to say, yeah, financially this decision is right, is not right. You know, just purely based on a return on investment perspective on putting it out there. But then when you combine it with the business acumen and the commercial acumen around it, then you get a holistic view to say, okay, fine, a return on investment may only be five years. But holistically, that ROI can, you know, double the value of our business in that five years’ time. So let's think long term and not short.  Announcer: (13:31)This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

IMA's Young Professional Leadership Experience: https://www.imanet.org/career-resources/volunteering-with-ima/young-professional-leadership-experienceFULL EPISODE TRANSCRIPTAdam: (00:00)Welcome back to Count Me In, IMA’s podcast about all things affecting the accounting and finance world. Today's episode will be another bonus episode of our IMA focused mini-series. Over the last few months. We've interviewed former IMA, young professional award winners and ask them specific questions about their early careers. Mitch: (00:22)Through this episode, we will feature snippets of four different conversations that highlight different aspects of an accounting and finance professionals. Early observations of the industry. Our featured speakers respectively are Jayada Samudra, Izz Ansari, Tiffany Larsen and Hari Ramasubramanian. These young professionals talk to us about their educational background in early starts, vital skills to advancing through their careers, what strong leadership looks like and provide advice for entering into the accounting world. Let's listen now. *** Adam: (00:58)Could you please tell us a little bit about your background and what you're currently working on? Jayada: (01:04)Sure, so I would say that the interesting thing about my background would be that I get to have that in two different cultures. One was in India and one was in the United States and I would say it would be in two different ways as I got a blend of accounting and finance. Academically I would start academically. So, I am certified management accountant. I already pursued my CMA two years ago and I would be graduating right now in August with my third masters. I would say it's a blend of two because I started off with my undergraduate in accounting and later on did my first master's in accounting but then moved over to finance to pursue MBA in finance. And right now, I'm graduating with my MS in finance. Right now, I'm working as a graduate assistant in enrollment and admissions where I'm helping, I'm acting as a counselor for the students. I'm helping the enrollment division to budget and forecast the prospective students and how the things I want to work with the incoming freshmen. *** Mitch: (02:13)What role do presentation and effective communication skills play on the job? Is it critical to have these skills at every level in your opinion? Izz: (02:22)Yes, actually the truth is that technical skills, while they are very important and we cannot underestimate the importance of those skills, they can only take you to a certain level. After that what really matters is how you present your point because after every time that you have applied your technical skills and Daniel work there, there comes a point when you either have to explain your work to someone or convince someone to see it your way. And that can be both wearable origin phones and mobile phones. It can be in the form of a meeting in which you have to convince, for example, your was or your clients to see it your way or to convince them that what you have done actually reflects the actual scenario or in a written form, which can be in the form of a report where you have to present your findings and justify them also. So just as an example, if I were to go to something from my work, if I am working on a financial one and I have taken some assumptions in my model, I have to later justify them to whatever I've done technically, makes sense, right? In the simplest words, it makes sense. So, it will depend on how well I articulate my thoughts and how well I present them so that they sound justified and convincing to help whoever I'm presenting them to. So yeah, I think that communication and presentation skills really do matter at an end. New York. The second part of your question was, is it a critical skill to have at every level? Oh, well, of course. Because these skills actually make you stand out no matter what level you're at. First of all, it makes you receptive to new ideas and new thoughts, which we generally don't count in effective communication in presented presentation skills, but it actually matters because if you have good communication skills, you're actually also receptive to new ideas. You're actually also a good listener. And Lastly, you also know how to respond well to any situation that comes up, whether it be in a meeting or just, you know, a random hi, hello with a client or something like that. You know, how to respond well to that situation. And that also includes your body language, you know, nonverbal cues that you give with your body when it comes to every level. Well, for example, if you were to talk about the most junior member on a team, he or she has to explain his or her work. Do whoever is supervising him or her when it comes to managers or directors or partners in firms or just, you know, CEOs or CFOs, If you go up to that level they're like walking, talking grants for their company or whatever film they're representing. Right? So even at the level of partners or managers or directors or CEOs or CFOs, at each point of time, and they have to present themselves at their best because they are walking in talking brand for their company or professional firm or whatever they're representing. *** Mitch: (05:36)In your opinion as leadership skills are developed by individuals, if you were someone who is entering a team or on the outside looking in at an accounting team, how do you identify who the leaders are? What are some of those signs of strong leadership within an accounting team? Tiffany: (05:57)I think that they trust each other that when there's a problem, when there's a lot of communication, they're asking for advice and thinking through and you can kind of tell for the leaders are because they're kind of the go to person. For example, in my previous job, if someone in finance then in the request to our systems administrator refer for a change, that person would come to me because they knew I'd be able to access, blame the request. In a way they would understand that there were some managers, but trying to talk with the system admin, they weren't affected because they weren't talking the same language. The system admin didn't have a back grounded in accounting. He's really good at it programming. And so, the leaders are those people that people go to for advice that they seek out their knowledge to build their skills. They know that person has different tools that are relevant and all of this is built on trust if there's the culture and you think that by sharing an information, somebody else is going to take your idea, claim it as your own, and they get ahead on your idea. Well, that's not a sign of trust if everybody's helping each other out to get the work done because sometimes you're going to be busier than your colleague. And so, if there's this trust, then one way to get trust is to have a feedback and depending on your relationship with the person or your need, your communication style there, the feedback loop is going to be different. Well this could be like when I was a remote employee, I'd have one on one meetings with my boss two to three times a month. It was just dedicated time for us to talk in private. Other times it will just be a less formal. The conversation, Hey, I'm having this problem, can you help me with. Just make sure it meets your needs. So, one way to be a leader, you've got to listen to others because the good leader doesn't know everything and they, they trust the people around them to be confident. and strong teams, good ideas, it can come from everybody. Or one person will have an idea and they kind of build off each other. *** Mitch: (08:38)Well, it sounds like you have a lot of really interesting perspectives on advancing through the accounting profession. So I'm just curious, if you were to talk with a student or even an accounting professor, maybe someone who is already in the field very early on in their career, what advice or suggestions do you give them in order to effectively advance through their careers?  Hari: (09:04)The advice that I have for students is that they should invest in understanding the concepts. I find a lot of students investing time in clearing the exams and completing the course, but they lack a long long-term view of what education should provide them. So, it's not just about clearing the exams on getting a job, that's not the end goal of education. The end goal of education is to improve your ability to think on your own. And that is the reason why in whatever courses I instruct, I ensure that I’m motivating my students by telling them why is a particular concept important or what was the evolution behind the concepts that they learn? I think that was one important skill set that I imbibed as a student and that really helped me to become successful as a student. And I think that is really helping me as a, as a PhD student as well. Because at the end of the day, research is about explaining the real-world phenomenon. You see a real-world phenomenon, what is happening in the real world, and you want to explain why certain thing is happening. Because until you understand why certain thing is happening, you cannot replicate it. So I think that that's very important to understand why certain phenomena happens because then you can then others can learn from it. So that one thing I think is undermined is the fact that you should focus on the conceptual understanding of whatever we are learning. So maybe any subject that you learn but invest in the basics and investing in basics is about reputation. And when you repeat the things again and again and again, that's when you get better clarity. You can't believe when, and I say this, there are a lot of concepts that I have already, learned multiple times. But when I hear a senior professor talk about the same concept and I get a different perspective and I think I'm glad that I attended this session, although I knew this concept, but I did not know that there was this aspect to this concept and that really is a useful thing that I learned. And one of the quotes that I always believed in is the fact that the difference between an amateur and the professional is the fact that an amateur practices till he gets it right. So, once you get it right, you'll say, okay, I'm moving on. But the professional practices till the time he can't get it wrong, which means he practices to such an extent that I know that I cannot do it all. Announcer: (12:17)This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Robert's Resources: LinkedIn: https://www.linkedin.com/in/bobkoechig/ Data Analytics: http://www.troutcpa.com/data-analytics Data Analytics Demo: http://www.troutcpa.com/data-analytics-demo FULL EPISODE TRANSCRIPTMitch: (00:05)Welcome back for episode 42 of Count Me In. As we strive to provide you with the information most important to your role as an accounting and finance professional. No topic may be more relevant than that of data analytics. Robert Koechig, president at TEG IQ talked with Adam about the importance of business intelligence for the CFO team and how to effectively use data analytics. Let's head over to their conversation now.  Adam: (00:35)So Robert, what is the importance of effective data analytics and business intelligence for the CFO team?  Robert: (00:42)I think the key word in the question that you asked was effective. I think most organizations in today's age know that there's value in data analytics and that there's business intelligence that they could access. I think most of the industry looks at that as basically really pretty Excel sheets, whether it's in browser, wherever that is. So I think we kind of have to take a step back and say, what does effective mean on what are effective data analytics. It's one of the things that we kind of strive with. We start with really saying if it's not going to provide actionable information, where you are digesting something that you're seeing on screen and being able to make an impactful decision in your everyday business operations. I don't really think it's an effective BI tool. So that's, where we really like to combine the data analytics and the business intelligence. The technology side, what we're passionate about is combining that with the human decision making element. So as a CFO we want to have technology bolster your gut feeling and or challenge it. being as the case may be.  Adam: (02:01)That makes a lot of sense to connect the two together cause they, you have to partner with the business. You can't just look at pretty charts and make decisions. You have to go beyond that.  Robert: (02:09)Exactly. I mean it's what we're trying to do is give you a tool that will enable you to make a corrective action at day two as opposed to day 45 when the books are closed at the end of the month. That's really what we're looking to. That's the type of environment that we think does become now an effective tool that you can use in your organization to really change. I mean, in some cases, if you could correct an action and have visualizations where it alerted you to an action, at day two in a process. So something that happened yesterday and you can make a corrective change today, then that's something that I think is pretty powerful.  Adam: (02:50)So could you give us a overview of the types of data analytics and business intelligence you focus on?  Robert: (02:56)Sure. So really what we like to do is, look at the fragmented data solutions. So what I mean by that is most organizations, especially in today's app world, have an app that does one specific thing very well. There are other situations where you have an all in one environment where you have one ERP system that does everything from payroll to time entry to point of sale to everything else. But really what we look for is, you know, kind of the low hanging fruit right now in the industry, which really makes a big value, is the organizations that use one application for payroll, one application for their order entry or their point of sale, one maybe business operational system in their warehouse or in their plant. Where there's reports that are being driven from each one of those, but none of them are really in a consolidated reporting fashion. One of the places where we really provide a lot of value and really what we're providing is value to, to our clients is the ability to take fragmented or disconnected systems. Great example of that is you have Salesforce as your CRM and maybe you have QuickBooks as your backend financial. They have operational integrations, but to run a consolidated report or even see insights right next to each other, Salesforce and QuickBooks. Usually what that means is you have someone on your staff who's pulling data down from Salesforce, pulling data down from QuickBooks, putting it into Excel and manipulating it from there. So that's typically where we like to live and the way that we do that really is by the ability to pull all the data without impacting your environment. So one of the things that we try to do is we want to have as minimal it involvement as possible and the way that we're able to achieve that is really by our interview interview process. So as far as the types of data analytics and business intelligence that we focus on, it's really, interesting to see how even within identified vertical niches that every organization operates a little bit differently. Of course you have your 80 20 rule, which always applies. However, where we like to really provide values is really looking at partnering with you and saying what will make the most sense? You know, we don't want to just provide a product, and this is typical in the industry, is within business intelligence. Someone says business intelligence, someone says data analytics and people think, okay, I'm going to have a dashboard, a dashboard that I can log in and it's going to show me all my metrics. And that's great. And from a very high level, it's absolutely what every single data analytics or business intelligence project is. But again, we're probably going gonna revert back to our first question of an effective environment. What we try to do is really say, what's going to make the most impact to you to see connected and joined together. it's one of, it's one of those things where we could provide something off the shelf. And a lot of what we do is, however, it's also partnered with the custom piece that makes your job that much more effective.  Adam: (06:22)So as we dig a little deeper into this idea of analytics and business intelligence, you know, most people understand analytics and insight is vital for business success in today's industry. So what is it about the data analytics that many often overlook or don't fully understand?  Robert: (06:38)Sure. there's the old mantra within It, really any technology project where you do a project and you kind of wipe your hands of it, you walk away and it's there and it's running. Business intelligence is a little bit different, you know, the analytics and insights that can change week to week in some cases. So what we try to, what we try to really educate, as we go through our projects, we try to really educate on is that this is a commitment to changing the way that we make our decisions as part of this organization. What I mean by that is what we really want to be able to do is say, this will be effective to you as as much as you use it. And you know, there's a lot that we can get into in machine learning and AI where the more that you put in, the more value that you get out, but at a very base sense of it, where we see a lot of the maybe overlooking or maybe just error in calculation is a lack of commitment from organizations once they decide to go forward with a project. So what we try to do is really focus on the data literacy. So yeah, we have the project, we have to build everything, we have to make it right. We have to make sure that it's giving you the insights that you need. But then from there, that's really the launching point. That's the stepping stone to get to an effective system. That's where a lot of organizations that we've helped have stopped is that post implementation. We really focused on that data literacy part where throughout your whole organization, ideally, but really especially the key decision makers, we need to be in front of them. Or you need to have a plan in place at your organization of, hey, this is a system that will benefit us in our decision making. How are we going to commit to always using it? And that's probably, I would say that's a majority of failures in a system. I would also say we try to, we try to validate data. there's always the caveat with these type of projects where garbage in, garbage out. If that's what we're looking at where we just have bad data come in, we can't fabricate good data. So in some cases you may need, you may want the business intelligence project, you may need to take a step back and say, we really need to clean up our data first. Let's do some data projects before we get into analytics or business intelligence.  Adam: (09:09)What is it? What do you think it is that gets somebody over that post-implementation and blues where they stop going forward? You just mentioned in your answer that they reached that wall. They just don't get over. What does it take to get over that hump?  Robert: (09:22)I'm a big proponent of top down, implementation specifically when it comes to these types of technology tools. What I mean by that is if as leaders in the company, no matter what level that is, whether it's the C suite, whether it's the director level supervisors, whoever's tasked with making those decisions when they're running their meetings, this needs to be a focus point. This needs to be the start. I'll give an example of an organization who implement Salesforce and the VP of sales never looks at it. They're probably not going to get great value from Salesforce, whereas the VP of sales who starts every meeting with Salesforce pulled up and looking at the results that are in Salesforce, they're going to get better, better adoption, better usage, better utilization within the tool. So one of the things that I would challenge any organization who's started these projects or who's looking at these is really think about that post implementation. You have the tools at your fingertips now, how are you going to use it so that you are basically making sure that you get your ROI out of it. And the first way to do that, in my opinion, is to use it while you're making your decisions. Of your company, usually it's very high level KPIs that begin the process. So when you're in your executive meetings or your board meetings, you know, the data needs to be in front of people there. That's really where you start getting an immediate impact.  Adam: (10:55)So share the data from the top down basically.  Robert: (10:57)Yeah, I mean the transparency and I understand that there's some privacy concerns that there's, you know, that type of situation. So obviously it's not going to be carte blanche but really for the meetings where decisions are really being made, it's critical that we're including this system and this tool in those, in that decision making process.  Adam: (11:22)So Robert, could you tell us a little bit about your role at Tag IQ and what you're doing to assist companies when it comes to data and insights?  Robert: (11:30)Absolutely. So I'm president of TAG IQ. We're a trout CPA company. Trout CPA is a public accounting firm located in Lancaster, Pennsylvania. They acquired us about a year and a half ago now and really what we're seeing, the partnership and the synergies there are that they're providing advisory services to their clients, whether it's around, evaluations, whether it's around tax planning, you know, really from those type of services. Well, the analytics is partnered with that. The analytics makes that service that much better. So what we are, what we've been seeing and what we're, what kind of our vision is here, in the past a year and a half and forward is that we're able to provide strong financial advisory services in addition to the technology analytics space. The partnership there is pretty powerful and so from my role, really what I do is I'm the Go-Betweens so I can speak the executive language and I can evaluate and identify business opportunity from a decision making standpoint, but I can also convert that to a technology developer who's going to be tasked with actually executing that project, you know, I'm passionate about solving business problems. And really when it comes down to it, one of the problems in any business is how do we make the best decision that we can make. So if you boil down everything, that's really what we talk about in business. So it's provided me a great forum to be able to just talk with business owners, talk with CFOs, identify what their challenges are and then translate that to a technology solution, that can make their life easier and their organization more successful,  Adam: (13:26)Make those effective decisions as we've been talking about.  Robert: (13:29)Bingo. Exactly right.  Adam: (13:31)So I think it's fair to assume that most businesses are using some form of technology. I mean, you already mentioned that when you, talk with different companies, they may have one doing their customer information in one doing their books, another one doing their something else. You know, everybody's doing so many different technologies to assist with their analysis and reporting, you know, but if the businesses aren't using effective data business and business data analytics and business intelligence tools already, what can they do to be more efficient? You know? And where should they look to start?  Robert: (14:03)Sure. So they should call me, absolutely 100% first. But joking aside, what we really want to do is we try to focus on two things which I believe are foundational. Consolidation. We've talked about that you have fragmented systems. You want to be able to have a consolidated environment. And so as you're working with your internal it or you're working with a consultant, whoever you're working with, that got to be paramount to be able to even start with an effective, environment. So consolidation of the data, whether it's everything that's completely integrated or that you're pulling data into its own data warehouse or data Lake, those are some of the, some of the tech technical words that we use to talk about. We store all of the different systems data in one place. That's definitely something that you want to look at. Even if it's just a question of do we have a consolidated data environment, it's a great place to start. It will open up many conversations probably with your technology provider. The other side of it is automation, one of the soft costs that every organization has when they don't have an effective CIT, system is they have in some cases multiple but at least one person's time who's running manual reports, who's doing this kind of the same solution. But manually when you add that up over the course of a year, the investment that that company's making in that employee to do that, typically is not where they see value in that employee. They typically don't have a position for manual data polling. So it's usually a controller or someone on the finance team who's kind of crunching these numbers manually and at a cost to the organization. So automation is something that you immediately, you have an ROI on because you're freeing up it probably key employees time, to be more strategic with the organization. So those two things are definitely foundational, to what we are really seeing. And what you're really able to be able to do is, if you can, if you can answer those two questions, do we have a consolidated environment and is it automated? What you're, what you automatically get out of that? If the answers are yes, is a lack of a waste of a key resource time, but also insights that you wouldn't have in a fragmented system.  Adam: (16:36)That makes a lot of sense. And in that key resource, you're suddenly able to develop them into a different type of a leader or grow them in their role because they can look at the data from a bigger picture as opposed to just mining little things.  Robert: (16:48)Absolutely. And really, you know, the insights part of it too is often overlooked. But the insights that you get from having a consolidated data environment really starts giving you confidence that you're looking even at the right KPIs that you're looking at the right metrics. You know, the, the ability to say, what should I be looking at? Sometimes you get lost in that when you don't have all the systems pulled together. You have one department who's working off of their system and it's never really integrated into the rest of the organization. And you find out that that has a key, that that becomes a key indicator of your business.  Adam: (17:24)Yeah. Everybody needs to be looking at the same picture to make the best decisions. So we just talked about how would somebody would get started. what about the other side, you know, a business already has advanced analytics and business intelligence. What do you see happening in the future? You know, what should that establish firm do next?  Robert: (17:43)Yeah, there's a lot out there, right? We're talking about technology in today's world and sometimes that gets a little, you know, I think the three, probably the three main things that everyone's hearing right now that are, whether you want to call them buzzwords or trends or whatever you want to call it. it's definitely the machine learning and AI. That environment, which is really, once you have an effective BI tool, machine learning and AI comes almost naturally out of that. but that's really becoming pretty hot and there's a lot of value there. And then the other one I would say is blockchain. Blockchain is one of those things out there that I think everyone kind of is aware of and people are, are dipping their toes in and you're seeing some of the large enterprise organizations make investments in that. But I don't think it's really come downstream to the mid market, small market yet that will, that will get here eventually. But I think if you want to make something that would make an impact on your organization today, it's really looking at the machine learning and AI. you know, I think in the next year or two you're going to start seeing most applications have a on switch to apply machine learning and AI. It's going to be one of those situations where you can switch it on and look at what you get. But unless, like we talked about before, you're committed to using it and you're committed to looking at the insights and splitting your data and looking different ways at it. you know, there really needs to be some expertise around what insights you're getting out of that machine learning. You know, the, the great example there, that I think probably everybody uses is customer churn. So machine learning is fantastic at looking at characteristics of your customers and predicting based on your history predicting which, you know, five or 10 customers you think you're going to lose in the next year. And if you can tell that six months before it may or may not happen, you probably are going to touch that client differently. You're probably going to work with that client differently. So that's an example of, you know, once you have your foundational analytics and you have automated reports, you have consolidated insights, you really want to start looking at that predictive analysis. Machine learning is a great place to start with that.  Announcer: (20:04)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

FULL EPISODE TRANSCRIPTAdam: (00:00)Welcome back for episode 41 of Count Me In, IMA's podcast about all things affecting the accounting and finance world. Our featured guests for this episode is Ivo Sokolov,, a data office division co-leader at one of the most profitable and best capitalized banks in Austria where he specializes in data engineering, regulatory tech and project governance Ivo joined Mitch to talk about how data engineering fits into today's accounting and finance function and it's emphasize the importance of proper controls over any data project. So what exactly is data engineering and why should accountants care? Let's jump into the conversation and have Ivo explain.  Ivo: (00:48)Engineering is a discipline that is, consists of parts of data center, acknowledged meaning databases. Then as an architecture, data structures extract, transform load processes and tooling on the one hand programming skills. On the other hand, self care architecture and and a bit of all new generation technical infrastructure knowledge. For example, cloud infrastructure, containerization, dev-ops and all of that combined, is sort of data-engineering.  Mitch: (01:25)And how exactly does data engineering fit into accounting and finance? Ivo: (01:32)The purpose of data engineering is to enable the organization to prepare data pipelines for, whatever analytical usage is may be required in the difference business functions. And finance is one of those functions providing the proper, the underlying data architecture that enables the finance function to quickly make sense of the data within the organization too quickly build and maintain data, pipelines for analysis and, and ETL processes and data science, including more, let's say more standard tasks like data cleaning and amortization, setting up batches, feeding them data into proper business intelligence tools, and preparing dashboards.  Mitch: (02:22)So now with all of this, how does data flow through an organization and for the finance function particularly impact something like forecasting or analyzing financials?  Ivo: (02:33)Using newer technologies in newer platforms, for example, Python and R, are tools that are usually employed nowadays, one can do predictions and forecasts on financial figures. For example, income statement, balance sheets, cashflow statements. And that can be done within the finance function, within the business division without requiring a specialized technique of the teams. Given that, you know, data engineering has prepared the data properly. The proper data pipelines ensures that finance has, depending on the news, the needs of the company, access to near time data or micro badge data, meaning finance does not work with data from the previous month or from the previous quarter. Having these, the underlying the data flows properly in the organization enables the forecasting and that is say for the financials to be much more timely.  Mitch: (03:30)So I know you mentioned a couple of the tools, but which tools and particular skills really would be most useful for finance professionals to kind of borrow from data engineering and assist with these analyses?  Ivo: (03:43)The tools are essentially around using modern of scripting languages such as Python or R. That also includes a lot of libraries with functions that are useful within finance for forecast for analysis. So a popular tool would be a set of source would be like the Jupiter, the Jupiter hub environment, Jupiter notebooks, finance professionals can simply log onto a browser from anything client and build their analysis in a, in a way quite similar to what, with Jupiter and Python or R. Similar to the manner in which you're a software developer, would you use the same tools to write software for other purposes. Other skills that are useful to borrow from data engineering are having whatever code one writes to do their analysis or their forecast or their models be put into, into version control. That way it can be, and used within the department that way people were structuring or going about solving a finance desk, the way that in software development, one would stop libraries with certain functions. For example, getting the proper customer segments or getting certain field there is that are used throughout. You know, one doesn't have to ride the same code three times and this is definitely, we see more and more of that in business departments and in finance  Mitch: (05:23)As these tools and skills are starting to become shared across an organization, essentially. How is the data that is the end result ultimately viewed differently across these functions? For example, finance versus it or even something like marketing.  Ivo: (05:40)Now the problem with a siloed data and every function having their own data warehouse or data to do their analysis. Looking at pretty much I'd say customer data in a finance looks at the customer and account from a different perspective that marketing was, but let's say 50%, 60% of the underlying selection of the data would be the same. And now if you've moved into a proper data architecture, you'd expect certain basic fields or basic definitions to be shared, to be put into version control. And that is different than the case there was before using the BI tools would imply publishing some of these dashboards on a server so that they can be shared throughout the organization so that they're not my Excel file sitting on a drive in my division. But also could be shared with marketing. It could be shared with IT if they have to add something or do something with it. So this goes into having a central aligned data architecture.  Mitch: (06:49)So with this data architecture and the version control that you referenced, I know data is pretty free flowing across organizations now, so who's responsibility is it then to make sure there's proper governance in place and governance projects that are set up with internal controls to monitor how this data is used and seen?  Ivo: (07:13)This really depends on the type of organization for certain organizations such as banks, there's a regulatory mandate, to do proper data governance and data aggregation capabilities across risk and finance. And data governance would imply that every individual owner of data within the organization is defined and then they would know when that data structure changes and continue to maintain it such that overall if you have a figure on your balance sheet and if you want to understand how that figure comes about, there's a very clear data lineage and that you know how to which steps and which data transformation steps or they engineering steps took place in order for the figures to be as they are, who is responsible for implementing that would differ. But we definitely see a lot of master data management or data governance initiatives and sometimes, depending on the state of the legacy systems of how new or how old the underlying data architectures their organization might need to rethink and initiate a strategic project in order to create the necessary there. The architecture for combining data from usually a really tens or or even hundreds of systems, operational systems. Where that piece of data source data originally resides. And usually finance departments and banks have to have the highest at stake at making sure that data governance controls are in place. That also implies of course data quality and ultimated data quality and data quality monitoring tools in place to make sure that nothing material in terms of data qualities ever negatively impacting the finance figures. So whose responsibility it is differs, but then the necessity remains to put this data governance principles and tools in place in order to ensure that data on which the decisions in the company and finance are made. It's actually sound and traceable.  Mitch: (09:26)And what if that doesn't happen regardless of the organization or who is responsible? What is the risk of not fully understanding governance and not having controls in place?  Adam: (09:38)The problem is with the poor data governance is beginning from the obvious ones that reconciliation or really digging down into figures in the financial statements would show major errors and gaps. I'm not understanding the risks because one does not manage, one does not have the data to base their risk decision on investment decisions. Operational risk decisions are predatory. So depending on the type of organization, different, various other types of risks going to a more pragmatic, increased spending in it and infrastructure because of maintaining multiple systems that don't reconcile, either the meta-data or their actual data. There's risk of manual errors with manual processing steps. Also BCBS239, for example, the fines the necessity to have that, to maintain that list of manual calculation steps for the key financial data because this is the risk in itself because of the ability to run them or unavailability or errors, and availability of sufficient quality, which results obviously in the risk of serious audit issues of material of information and highly increased IP spending. I think the summary of this is that by not having proper data governance and proper data quality controls, a company is not saving money. Essentially, this is not an item that you should omit or they think it's too costly to do because if you're not doing it, you will end up one way or another overspending or many other ends.  Mitch: (11:29)For the future of finance and accounting. What is your prediction or how do you see data governance playing a larger role in the finance function of organizations?  Ivo: (11:42)Data governance is a central topic once re-platforming of systems and new cloud data warehouses. Projects are initiated throughout companies at this point. Also, what needs to be said is that it's the governance. It also touches a bit on security and data privacy during the ongoing in future projects. This is going to be a central team, especially if companies realize that we have a complicated landscape of old IT systems and finance has their own data warehouse and risk and retail and marketing. They all have their own data warehouses and now we should have this one data warehouse or one platform where they communicate with each other. There are different types of methods to do this, but data governance is not, you know, solved by tooling but also by policies and by the organizational design. So I think it's worth considering data privacy, data governance, data quality and, override the security. And basically the IT security aspect alone is something that companies that wouldn't normally go the extra mile and security could borrow from organizations like banks that have a very good grip on what data is visible to whom for which purposes. Thinking about this measures about how they would apply for the individual organizations, would definitely pay off, and it will provide a more structured way to use the data available for any type of decisions.  Announcer: (13:16)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

"Govern Your Bots!" by Loreal Jiles (Strategic Finance, January 1, 2020): https://sfmagazine.com/post-entry/january-2020-govern-your-bots/Links to learn RPA Development or other things about RPA Tools for Free  UiPath: https://www.uipath.com/rpa/academy  (The name of the RPA tool is UiPath and this site is to UiPath Academy). Automation Anywhere: https://university.automationanywhere.com/ (The name of the RPA tool is Automation Anywhere and this site is to Automation Anywhere University) FULL EPISODE TRANSCRIPTAdam: (00:00)Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host, Adam Larson, and I'm happy to bring you episode number 40 of our series. Today's conversation is between my cohost Mitch and Loreal Jiles IMA's director of research for digital technology and finance transformation.  Their discussion revolves around RPA and the practicality of robots and accounting. So, let's transition over and hear what Loreal has to say.  Mitch: (00:31)We keep hearing so much about RPA, but I'd like to kind of start off on the right page here. Can you tell us exactly what is RPA?  Loreal: (00:45)Certainly. So RPA stands for robotic process automation, and my personal definition is RPA is a technology that enables a virtual robot or a bot, as we call them, more casually to emulate human interaction with computer applications to execute processes. And so in planar terms, what that really means is the bot mimics the clicks and the keystrokes of humans to perform a process on a computer. It can navigate through desktop or web based applications, and it can do all of that simply by accessing what's called the user interface or the UI. And the user interface is the part of an application that all of us as humans see and interact with. There is another part of each application that's in the back end and that's where traditional computer science majors or programmers access that to right code to either modify the application or to automate things that way. Right? Historically, the only way to automate things was to access the backend of the application. What RPA does is it allows us to do things, things that historically businesses, professionals or non it professionals would not be able to do because now without having to access the back end of the application where there's admittedly a bit more risk, we simply record the keystrokes but clicks the type, of the human throughout the process and allowed the robot to replicate those steps. After we've documented it in sequential format in the required, I'd say the required format that's necessary. So what's really cool with it, I think is as opposed to going in the back end again, the automation happens right in the front of the screen. And in some instances you can even watch the robot perform your process. Um, so RPA for me is the easiest way to automate processes for non it professionals.  Mitch: (02:42)So you just said it right there. non-IT in our audiences, finance and accounting. So how real is RPA in finance and accounting? What are some of the typical uses that you've come across?  Loreal: (02:52)Oh, I think it's incredibly real. I'd say first off, it's, it's very real across many. And so McKinsey published a study just a few months ago highlighting RPA offers potential ROI of 30 to 200%, and in fairness with the right selection principles for a process, those projections aren't incredibly conservative. I start there because nearly all enterprises who have begun RPA journeys regardless of their industry, they started in the finance and accounting department. And so that means that the thousands of companies that are using RPA today, over 70% of them started in finance and accounting. And that's incredibly powerful because it says to us as finance and accounting professionals, how do we want to be impacted by the technology? Do we want to be the recipients of it, if you will, or to be on the front end. And my encouragement to finance and accounting professionals is to consider being on the front end of it. The other thing I think I'll highlight is, although it's tempting to say, um, we're not developing bots or are developing robots themselves or actually developing processes that robots will perform. And the only thing we have to do to do that is effectively to tell the robot what steps to take. Yeah. Who knows those steps better than the people that actually perform them. Yeah. So my mantra is more can we have finance and accounting professionals developing these processes as opposed to solely it professionals. That doesn't mean everyone will be converted to a developer, but you could play a critical role in either process requirements gathering in, in exploring what's needed to be able to facilitate or progressed the implementation, if you will. And so I think in that space, we're seeing something where every company, or just about every company that starting RPA journeys is starting in finance and accounting. Our processes lend themselves a bit more. It's a automation because of the cyclical nature because some of them are routine just by nature of what we're doing for month end close or quarter end close for example. And so I think in the spirit of that we as a profession will see a ton of this, for those of us who haven't already been exposed to it, significantly,  Mitch: (05:10)Well, in my own personal research trying to learn about RPA and how finance really fits in, I came across democratization of RPA and quite honestly, I'm hoping you can give us a little better definition than what I read online.  Loreal: (05:23)Oh, certainly. Yeah. So democratization of RPA is a phrase that summarizes the concept of a bot for every employee and some people go so far as to see a bot for every human. I'm not trying to go that far, but the concept of a bot for every employee means that if I sit in any corporate setting, despite the company, just like I have a laptop and it's automatic, that when I start working for that company, they will give me a laptop. And that laptop will have Microsoft office suite when it, for example, there's an by some people or envision that I will also have a bot on my laptop as well and I'll have software that allows me to automate some of my processes on demand and in real time. And my robot that sits on my laptop will effectively become my personal assistant in that world. I think we've, we've got a little wait before we can get there. So would I ask myself if I truly believe in democratization of RPA? Yes. I think it's a far off, but in fairness, no one thought we would have a laptop when every desk, just a few short decades ago, no one thought we'd have effectively a computer in the palm of our hands or in our back pockets. And so what I think we have to do before we can truly realize something like democratization of RPA is that the technologies themselves, the software vendors, we'll have to continue to progress the user friendly nature of their tools. There are a couple of tools that are more user friendly than others. And there's a recent Forrester report that was published earlier this quarter that tells us who the leading RPA players are. And I think the top three that they've highlighted are UI path automation anywhere in blue prism. Having touched each of those systems personally, I've found the barrier to entry much lower for UI path for a non it professionals. And so that answer's very different if you're thinking about a world where it professionals will develop all of the opportunities themselves. But as we progress along this journey toward democratization, that means we would have to have less and less dependence or reliance on it, expertise or computer science and knowledge to be able to progress. So I think in this world, in today's world, I don't see it happening in the next couple of years. However, if these, these software vendors continue to progress along their journeys and they're moving incredibly fast, RPA is a relatively new technology, just a few years older. So yeah, if they continue to progress along their road-maps along the journeys, then yeah, it very well may be something we see in the next five to seven years.  Mitch: (08:03)Well, you just referenced three pretty specific, you know, software programs and very tech savvy businesses. So what is the reality for, you know, business in general? Uh, how can businesses kind of take advantage of these different RPA, processes and, and what are you seeing as far as some of the smaller companies trying to take advantage of this?  Loreal: (08:26)Sure. So I think that a couple of things for people to realize is what these vendors have done now is they've provided training for free. So for companies like UI path and Automation Anywhere there is online training available in their websites for free. And that means the same training that we take people through at my company today in order to get them certified in RPA development is the same training that someone sitting at home who's unemployed could take for free on the internet. And so I think that's the first piece to realize that the, the data and the information and the tools are really right are at your fingertips. I think the piece beyond that, as we think more strategically about an organization implementing it for larger enterprise, several of them are already starting when their journeys, they have whole it organizations, the it organizations are standing up the infrastructure dev test and prod environments. They're installing the software on virtual machines, right? They've got a small dev ops team that's working through the implementation and if they're doing this the right way, then that dev ops team is a hybrid of it and business professionals. So that's what we see most customary in larger enterprises for smaller than mid size companies. What I'm a bit startled by this, it doesn't seem that they've embraced the technology as much. And I'm not sure why that is. I don't know if it's because there's a belief that it costs too much or there's a belief that it's only for larger enterprises or that all this infrastructure is actually required when if you go to the website and download the application for free, the software for free, you'll get the same enterprise grade software that we have at our company. And so in that world, if you could put that on your laptop, learn how to use it for a smaller company, I think there's actually stronger business cases for small and mid companies to leverage this groups where there are 10 to 20 or even 30 people that are in their finance and accounting department. They're generally overworked because they're doing end-to-end stuff instead of what you see in the large world where we've got teams devoted, yeah. Only to AP P teams devoted only to to AR to accounts receivable, and so in a world where you've got smaller than mid size enterprise, they're working into end and they've got a ton that they need to have happen in a very short period of time. RPA can be a perfect solution for those enterprises. Yeah. Yep. Price point is incredibly low. So I'd say at best they, a smaller group could start with maybe 30 grand or less per year in licensing costs and they could get the training for free, get a bit of support to figure out how to get up to speed. But outside of that, you're paying nominal things in licensing cost for a bot that can run 24 hours a day, seven days a week, 365 days a year. And that means in a world where you've got a team of 24 people, well who are working insane hours during close. If you could take away some of those activities that they're not all that excited about anyway, then you can increase your accuracy, you can increase the assurance for those processes and certainly the efficiency of being able to progress it. So I think at the world for larger enterprise is starting to catch on already. Along the smaller and mid size world, I think we've still got some ways to go and just making sure we heightened the awareness to this and what its true capability is.  Mitch: (11:56)You've certainly done a great job, you know, answering my questions and giving me a better understanding of RPA and you've done a really good job highlighting all the benefits, but I'm sure there's also risks that come along with bots like this. So what kind of risks do you think our listeners need to be aware of and twofold, how can businesses who are looking to implement this RPA mitigate those risks?  Loreal: (12:18)Certainly, certainly. So there are tons of risks with any technological implementation and at things that external auditors worry about. For example, are things like credential management, how will we manage the, the user credentials of the robot itself? Will it be a service account? Well, we treat it like it's a human account. When it needs access to the accounting system, what types of things will we allow the robot to have access to? Do the segregation of duties still apply in that scenario? Just as it does with the human, will we allow the robot to enter banking credentials for a supplier and to process an invoice and approve it for payment? Other things would be kind of bigger than that outside the tech space specifically is humans orchestrating the inputs to the process for a bot to perform and the process that they perform ends up being a fraudulent transaction. So those types of things are very real. And I think there was the first documented case of fraud for RPA just within the last year or so. And it was not so much on the credential management side, but humans orchestrating the inputs so where they know what the inputs to the processes, the bot picks up those inputs and then performs the transaction accurately, but with fraudulent information. And so those are, are some of the key risks that I think, especially as a finance and accounting professional myself, that I think about and that external auditors are thinking about on a regular basis to mitigate those risks. At BP specifically, we've written what we call a governance and operational framework. And that truly speaks to not just how will we govern which processes we will automate, but from a technology perspective, how will we govern, the credential management, we store all of our credentials in an encrypted vault, which some software vendors make available. And then there are others that you could patch on to that, that kind of reinforced that security, if you will. And there are a host of reviews that are required before we go live with any process. So one thing to bear in mind is from an implementation perspective, you could have centralized, decentralized or federated, models for your RPA program. And what that means is centralized would be a world where there's a small team or a large team in fairness that handles all development and implementation. If you go all the way to the other extreme on the spectrum, you could see a world where there's federated, where you've got a central hub that's maintaining governance, but there are smaller groups within the organization that are deployed and doing the implementation as well. And then all the way to the other end would be the world of citizen development where you truly put the bot on each laptop and empower the employees to build things as they desire and deem appropriate. And so different governance models would be required for a centralized versus the federated versus the true citizen development world. And I think that so truly mitigate that. It starts very early before you start deploying lots of opportunities. It starts with engagement with your program sponsor, which is likely a finance leader, right? That's relatively senior or at the executive level. It starts with key conversations with the it organizations in the digital security groups. We also proactively engaged our external auditors just to understand what risks they saw available or that might come up. And then figuring out how we mitigate those as well. And so I think the ultimate response to how we mitigate the risk is through governance of RPA. Right. And that governance should be tailored to whether or not there's a preference for a centralized model, decentralized, or the citizen developers option.  Mitch: (16:06)Well, there's certainly a lot to consider as we're talking about RPA and I know just all other digital technologies as well. We're progressing so fast, it's really hard to predict what's next. But I'm just wondering if you had any thoughts on, you know, putting these governance principles and policies in place, you know, how will that ultimately help a business in their implementation as RPA or any other technology, like I said, continues to evolve and how can organizations prepare for what the future may hold in the accounting and finance industry?  Loreal: (16:40)Sure. So I think that no digital technology will be truly implemented successfully and sustainably without governance. So you would do what we call a proof of concept initially to figure out if the tech, the specific digital tool, whether it's RPA or otherwise, if it works for you, if it integrates well with your applications that are within your organization, web-based or desktop applications. So you'll test out what we call a proof of proof of concept. And that's where you'll pick a use case and just see if the technology even works as a trial run. What's next I think is we generally do a bit of a proof of value. And so that's a concept where we say, let's make sure that this is actually going to be valuable. Will we save enough hours to make an impact for our teams? Will we truly be able to automate the processes that really matter or is whatever the technology is best suited for a different use case that's not quite as impactful for the organization. The step beyond that, and so what we did a bit in parallel proof of value is standing up the governance and so you'll want to find out that specific organization what the current ways of working are. If you need to do something like I did, which is write a hundred page policy for governance, or if you don't necessarily have to go that far, if you've got a smaller group where you have a 10 to 20 or so finance professionals within the organization, the the large policy might not be needed, but in its purest form. Every company that's getting started on an RPA journey needs to identify how will they handle technology governance? How will they manage credentials? They'll have to think through what their operating model will look like, how will they do process selection and identification and all of that. Regardless of if you're using RPA or data visualization or data science or data analytics as if you're allowing people to write Python scripts for analytics. If you go to other extremes where it's just your it organization doing artificial intelligence or machine learning implementations. And so with any of that, you'll require some governance. You'll require governance to identify what the right use cases are. Are you truly elevating the value right, that your finance and accounting organization delivers to the, to your broader business, right? Or are you focusing just on finance and accounting processes? And so what we try to do is strike the right balance there because ultimately we're in service of the broader organization. And so I think as we think digital technologies in the future, key technologies that finance and accounting professionals need to be aware of are data visualization, data science or analytics, RPA because it's got a pretty low barrier to entry, similar to data visualization and then yeah, an awareness level of surface level. I think also an artificial intelligence and machine learning capabilities, the impact that that'll truly have on our profession. I think we're still a few years out, but what we'll start seeing is I believe that data visualization and RPA, we'll have the largest impact in the next one to three years. What we will ultimately see, I think down the line is the artificial intelligence world where we're able to automate judgment. And so the way that we peer that with RPA is through something called intelligent RPA or intelligent bots. And so yeah, that's a world where RPA is leveraging other technologies, algorithms that someone may have written and the robot is then going to kick off running that algorithm to be able to then bring that data back and leverage it through some other automated process. It will be bacon, some of the judgment that we have now, so there's this concept or this thought that, Oh, right now we're only automating things that don't require any judgment. The technology is actually much farther along than people are with regard to implementing it and so there are already solid use cases for automating things that also require judgment. It's just integrating a more into end solution with multiple well technologies. I think down the line, what a finance and accounting professionals job looks like will not be, I had to do data entry, I had to get to work in the morning and wait for a report to refresh before I was able to perform any analysis. What we'll see in the future is we show up to work the morning of close and our robot has already run all of the reports we need to review. It's leveraged some artificial intelligence based on past trends to say, these are the exceptions that I believe needs to be reviewed, and when we get there in the morning, we'll be reviewing exceptions and spending more quality time on the analysis and how that translates into additional value for the business.  Announcer: (21:30)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you liked what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

IMA's website: https://www.imanet.org/IMA's Leadership Academy: https://www.imanet.org/career-resources/leadership-academyMentoring with IMA: https://mynetwork.imanet.org/mentoring/mentoringFULL EPISODE TRANSCRIPTMitch: (00:00)Welcome back to count me in. IMA's a podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong with me is my co host Adam Larson and we are happy to bring you episode 39 of our podcast series. Most management accountants can relate to the benefits of having a mentor. So to kick off the new year, we have an episode dedicated to mentoring.  Adam: (00:28)To start us off, we're going to hear from Olya, manager of financial planning and analysis at United rentals in Stanford, Connecticut. She is going to talk us through the benefits of mentoring for a mentee for the mentor and how to develop a mentoring relationship. Also, during this episode we're going to jump to a couple of personal stories from different finance individuals who have realized the benefit of having a mentor. So without further ado, let's listen to our conversation on mentoring.  Mitch: (00:55)In your opinion, what are the benefits of mentoring?  Olya: (01:04)In the recent years, so much has been said and written about the benefits of mentoring from both the mentee and mentor. Not surprisingly, mentoring has become increasingly popular among successful organizations. In fact more than 70% of fortune 500 companies use mentoring to attract, develop and retain talent as well as increase productivity and that they interest in. The fact is that mentoring has also been credited with helping entire organizations cultivate the culture of innovation and inclusion.  Adam: (01:38)How so? What are the overall benefits of a mentoring relationship say for the mentee first?  Olya: (01:43)There are numerous benefits that mentoring provides for the mentee. Whether you even start by working with the mentor, the mentee receives personalized education that is tailored to their specific needs. Who would then throw on that? For example, when I was initially looking for a mentor, well I wanted was to find someone who could help me improve my public speaking skills. I'd lay the land my needs, you will. Beyond that, my mentor and I developed the new plan. The next benefit is that mentors also provide mentees with the advice and guidance they need to help them define and set realistic career goals as well as develop strategies on how to achieve them. They also hold them accountable for the results, which I believe is the key to success  Adam: (02:34)And as a mentee, how important is it to select the right mentor to reap these benefits?  Olya: (02:41)The right mentor will encourage you to take calculated risks which ultimately increases both your leadership capabilities and opportunities for advancement. At the same time, they could also save you from making mistakes that could set your career back. When I was looking for a way to enhance my leadership skills so I could prepare myself for the next role. My mentor suggested that they joined the board of a nonprofit organization. I followed his advice and after receiving my CMA certificate nation, I got involved with my local IMA chapter. There I gained valuable experiences and skills mutually the arm I was able to apply at work.  Mitch: (03:28)To reinforce all your summary of the benefits for a mentee in a mentoring relationship. We are now going to hear from Anthony Sperduti, manager of financial planning and analysis at United rentals as he shares a story about the impact mentoring had on him in his career.  Anthony: (03:42)Early in my career I faced a difficult situation and that's when I learned the benefits of having a mentor. When I was a second year staff at the CPA firm I used to work for, I made a pretty significant error on one of our audit procedures. We had just finished field work and the error would require going back out to the client and re-performing the audit test. I can remember the unsettling feeling of having to go to the principal on the account worrying how he would take it instead of chastising me or yelling at me over it. He told me, as long as you worked for me, it'll never be your fault. I reviewed the work too. We both missed it. That was a really important lesson for me. Mistakes happen, but instead of making me feel worse about it, the principal helped me learn from the experience, understand how the mistake happened, fix it and re instill the confidence I needed to tackle my next job. From that moment on, I sought this person's guidance throughout my career and still do to this day. Despite no longer working together, I attribute much of the success I've had professionally does mentorship and hope to emulate the impact he had on me to other young professionals to help them advance in their careers.  Adam: (04:57)So before we transition over to the mentor side, do you have any other comments on the benefits of mentoring for a mentee?  Olya: (05:06)This podcast is not long enough to list all benefits for the mentees. I could go on and on, but if I reflect on my personal experience, I think the most valuable benefit of mentoring is that it provides a positive, but at the same time challenge and the growth environment with mentee can improve their skills and build confidence necessary for their future success.  Mitch: (05:31)Okay. So now in your opinion, what are the benefits of a mentor and relationship for the mentor?  Olya: (05:37)That's a really good question because I think the benefits for the mentor are often overlooked. A common misperception is that the mentee is the primary and sometimes the only beneficiary from the mentoring relationship, which is not necessarily true. I read and heard multiple testimonials when mentors side just how rewarding their mentoring experience has been and how much satisfaction they received when they give back to their organization and the profession they love. They also highlight that helping others grow and develop by sharing their knowledge, insights and expertise has made them by their leaders as well which in turn enhance their but you need just for advancement by being the mentor. They also earn the respect from their colleagues and prestige at their organizations. It's not a secret that the leaders who can develop other leaders are highly valued and sought after and that the benefit that I'd like to pinpoint is that mentors can also learn from them into use so they can stay current with the most recent trends. That's why the concept of reverse mentoring has been gaining popularity when younger employees appear this season. Executives usually to teach them about new technologies and products. As you can see, there is something in mentoring for everyone.  Adam: (07:04)We are now going to turn our attention to Tatyana Corban, CPA and freelance principle consultant so we can hear one of her personal stories and her perspective on mentoring.  Tatyana: (07:13)In your professional life, you could become a mentor, a mentee even without assuming a formal role that happened to me. I was liking one of my first accounting instructors at a local community college was a welcoming and knowledgeable individual. His name was Mike Lawrence. Michael was both CMA and CPA. He was teaching accounting in the few colleges and universities for over 20 plus years and he also was an IMA board member. I shared my educational and professional goals with him and as his student I was able to get his professional guidance. After I finished the course, Mike invited me to the local IMA chapters monthly meeting. Being new to the country and to the area. I was very excited to meet other professionals and the meeting Mike advised and encouraged me to join the local chapters. I am a board of directors. I followed Mike's advice and started attending the board meetings right away. I did not have a specific role. For some time, but ended every meeting nevertheless and contributed. However I could. Mike believed in me and encouraged me to continue working on my certifications. He's been a very strong, positive influence in my life. Throughout the years. We would meet a few times a year for a quick lunch or the monthly chapters meetings. I would share with him what I was going through in my professional development would ask for his opinion and his guidance and he generously shared his with them with me. His faith in me and encouragement definitely helped me progressing further in my professional career. Through Mike's encouragement, I volunteered for almost nine years at the local IMA chapter, including five years of being in charge of the educational program. As a VP of education. Through my volunteering and working with local IMA leaders, I was able to get more informal mentoring and coaching. I also build stronger professional connections and improve my leadership skills. When you look for a mentor, I mentee don't only look for formally organized mentor-ship programs and invest your time in building relationships with people around you. When looking for a mentor, reach out to more experienced and successful people at your college and university, your work and visit local professional organizations to find the advice, encouragement and guidance you're looking for them. Although each organization will have different requirements, you often would need a specific title or expertise to attend the networking events. One of the great resources for you are the local IMA chapters if you have one in your area, but then in the chapters meetings and volunteering, you will build your network and find the mentoring relationships.  Mitch: (10:14)So Olya, can you please now share with our listeners how to go about finding a mentor when looking for a mentor?  Olya: (10:25)Many of us think of our workplace as the most logical place to start our search and while having the mentor at work definitely has its benefits and conveniences. I would also encourage you to look for a mentor outside of your organization so you can take advantage of their independent perspective. For me, it's a similar concept to how organizations select their board of directors. They want someone impartial and objective in their corner and I believe so should we. My mentor once told me, just like you choose your job wisely, choose your mentor wisely.  Announcer: (11:03)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Steve's Articles: https://sfmagazine.com/post-entry/november-2018-business-transformation-no-pain-no-gain/ https://sfmagazine.com/post-entry/october-2018-catalyst-for-change/ FULL EPISODE TRANSCRIPTAdam: (00:00)Hey everyone, this is Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson and I'd like to welcome you back to another episode filled with valuable insight from an industry leader. Steve McNally is a CFO, board director and thought leader who joined Mitch to talk about business transformations. While business transformations may not be new to accounting and finance, Steve provides practical steps, best practices for setting up implementing and completely successful transformations for your organization. Keep listening as we're going to head over to their conversation now.  Mitch: (00:40)How do you define business transformation?  Steve: (00:50)Typically based on my experience, transformations are big, complex, expensive, time consuming and at least theoretically you hope so to have a significant positive impact because simply I believe transformations are all about trying to change the way you do business with on a global enterprise wide scale well on one is more limited  Mitch: (01:14)And what is the current nature of business transformations. Steve: (01:19)In terms of current nature? My first remark is transformations have been around for a long time. Maybe the word itself is used a whole lot more, but transformations had been around for quite a while. One of the most typical examples of transformations would be ERP and or software implementations. For example, SAP. I know that's one of the big ones I did in my career. That's it. Other kinds of transformations include keeping up with regulations, whether you know, a couple of years back, Sarbanes-Oxley more recently from a finance accounting perspective, the revenue recognition standards, the lease standards, other gap changes under other regulations and these kind of regulation changes really force in some cases a company wide change in how they do business. Other typical transformations would include, for example, in house versus outsourced services type decisions, uh, within finance and accounting. For example, decisions around, you know, typical plant finance and accounting responsibilities. Should they be done in house or is it more efficient, more effective to outsource and offshore them and in some cases, is it more efficient and effective to bring them back in house. Another kind of transformation occurs when there's been a major change in key leadership. Whether your CEO, your CFO, other personnel changes, like head of a division anytime there's a significant personnel change, it's going to change not just that person and that team, but it'll have ripple effects throughout the organization. Also, there could be outright end to end process changes within a company organization. For example, a services company that does engineering work for others might be rethinking this project process flow, trying to optimize that activity. And that really will affect all the different individuals in the company. All the different functions and partners within that company. Another type of transformation would be M and a mergers and acquisitions, whether you're on the acquisition end or you're the company being acquired, but when there's a merger of these two different companies and cultures, it's going to be a significant transformation. And lastly, one thing that drives transformations is keeping up with growth. If you're a small startup and things are going really, really well, you're going to have to keep up with that from a personnel perspective and manufacturing perspective, a process and policy and procedure perspective, a financing perspective. So all these are different things that could drive a typical transformation or need for transformation.  Mitch: (04:05)So in your opinion, from the different reasons that businesses have gone through business transformations, can you explain some of the best practices that you've seen for setting up and initiating the overall transformation?  Steve: (04:18)Sure. I think there's really three, three key best practices or three things that feed into that. First of all, you really need a compelling business needs. So what is the problem you're trying to solve? What are the underlying root causes? Are you trying to overcome the tough competitive environment and you delay investments for a number of years and now you need to catch up or the new regulatory requirements. So what is that compelling business need to initiate this transformation? And of course the transformation requires significant investment in time and the resource people and money. So you want to be sure it's the right thing to do. The second thing is your case for change. So you as the leader, you may have the vision, you may know that you need to make a change within your company, within your organization. However, you're not going to get there alone. You need a core team that's going to work with you and you know, day to day make this transformation happen. And then you need other champions who are going to be out there, the key stakeholders to buy in and to support the initiative that you're focused on. But you need to create this case for change to make sure that you win the hearts and minds of all these individuals who are going to make the industry initiative. They'll make the transformation a success. And then the third thing, the third best practice I would say is project plan. So in general, a project plan really helps you articulate what you're trying to do. Gain alignment at all levels within the organization and alignment on project scope, on milestones and timelines on the budgets. So overall, make sure that you have clear line of sight of what you're trying to devote to deliver and how you're going to deliver it. That's it. A solid plan. It's all a project plan to be highly motivational. It can help you celebrate the milestones as you're going along and it can also help you quickly identify if you're going off track. That's what a good solid project plan will do for you. But you also do need to be flexible. So a project plan, in my opinion, the project plan that you've managed centrally. Depending on how big, how complex your initiative is, the core project plan should be, the highlights should be the big picture of what you're trying to accomplish. And then there's various sub teams and those sub teams should really manage their own details. And the other way that a project plan should be flexible, especially if you're dealing with a project that could last, I don't know, 1212 months or more, even two or three years. In that case, you're not going to detail out the plan from start to finish. But rather I would suggest you should detail out the plan for the first, is it three, six, nine months, but have milestones along the way and go no go points along the way. And as you approach a note, well at that point then you detail out the next phase in the next phase. So a project plan can be really helpful and insightful, but you also need to be flexible with it.  Mitch: (07:42)Now I know a project plan typically incorporates a lot of cross functional needs and what you need from other departments. So from your experience, which functions of a business typically realize the greatest effects of a business transformation following the implementation of this project?  Steve: (08:00)Well, that's a hard question to answer in that it really depends on the nature of the transformational initiative itself. As we said, it could be a software implementation, it could be, an in house versus outsource services type project. It could be impacting a specific function, a specific division, or it could be impacting the entire company. So it really depends what the initiative is. That's it. For example, let's assume you, you're running an initiative to change your, your go to market strategy in terms of trade spend. So you're a CPG company and you know that based on benchmarking, you're spending way more on trade spend than your competitors are. So in that case, the core project team is, is going to be sales related, field for example, and they're going to be the ones that had the direct impact. However, as you roll out that change, it's going to have implications for the support functions as well. So if for example, that project changes how the field sales organization is structured and or how they fund their customers with trade spend projects, well then you may need to change your systems, you, which could impact your it folks, you could change or impact your financial folks could impact your HR folks as well. So that's one example where the core is the sales organization is going to be impacted, but the support services as well in addition. Another example I would throw out would be the company's decided to implement a global services group. So historically, human resources and supply chain and finance services and market research and other functions. Historically that was all within the respective divisions. But going forward, the company wants to create a global shared services group. So first the people that are directly impacted first are those in those functions who are performing those roles and responsibilities because now they're being pulled out from where they were and they're all being centralized into this new group. And centralized could be physically centralized or it could be personally centralized. But the point is there's now new reporting structures for the HR, the finance and supply chain, the market research and other, individuals. So they're directly impacted. However, this global shared services group, it's still going to be benefiting and supporting those divisions. So those divisions are clearly impacted as well, those other stakeholders. So, and in those divisions you'll have maybe a small group of human resource or finance or supply chain or market research or it folks that are still in the division, but now they need to interact different with those that are in the shared services group. So it really depends on the nature of the transformation, but there's a core group that are directly impacted but almost always is going to be support functions. And or customers who are impacted as well. And you really need to think through, think through that new relationship  Mitch: (11:31)In planning for the overall business transformation. What challenges should an organization expect or what potential pitfalls do you think they should be aware of?  Steve: (11:42)From my perspective, there's really five potential pitfalls that could impede transformational success. So the first is neglecting the people. So as we already discussed, your people ultimately will make or break a transformation. You can't get there alone. Your people include that director core project team that's making it happen. And the people also includes the cross functional stakeholders and individuals impacted by the change. And ultimately the people include truly all levels of individuals within your organization depending on what the change is that said your people either for or against the initiatives. And that's why it's so important that you sell in what you're trying to do upfront to that compelling business needs. And to that really effective case for change. And then as you're working through the initiative and go live with the transformation and you know our post go live, you need to be focused on change management. You need to communicate throughout the process. You got to keep those people on board. You got to continue day by day winning their hearts and minds to support this initiative. The second pitfall is that the initiative, the transformation, maybe bigger, a bigger challenge than anticipated, whether give you poor planning. So if you didn't invest the time upfront to really think through what you're trying to accomplish and what it would take to get there, it could be a simple scope creep. I'm sure we've all seen projects where upfront you've defined the scope, but then things change and they're just small increments. But you know when there's ten, twenty, a hundred, thousand small increments, all of a sudden that little scope creep becomes a big deal. And or , it might be a bigger challenge than anticipated due to unintentional business changes. So unfortunately, you know, the world doesn't stay still. Business is changing. The markets that we play in are changing and therefore sometimes we need to react despite our best plans up front. The third pitfall is unexpected vocal law. So for example, you might have the best team in the world focused on your initiative. However, if a team member leaves, whether they move to another department within the organization or whether they leave the company outright, that has an impact. Another unexpected roadblock, you might be implementing new software. You've clearly defined your, your requirements. And then the software developer comes back to you days before you expect it to go live to say, Oh, we just couldn't deliver it or we couldn't deliver it time and you need to react to that. And then the third thing is, um, new business needs might be identified. So again, business is always changing. And despite our best efforts, sometimes we just need to be agile and react. In fact, more often than we need to be agile and react. The fourth pitfall or would identify is the inability to execute. So you might have a great strategy, a great plan, but you might be unable to execute it. Why? Maybe you don't have enough resources or maybe have the wrong resources or maybe you're dealing with poor leadership, but any of those things could cause you not to deliver. And then the last pitfall I'd highlight is the the sustainability challenge. So all the time and focus is on that go wide getting there. And how many initiatives have we seen where we do a great job identifying who's going to be impacted, we effectively train them for that go live and then everyone goes on with their life. Well unfortunately people are gonna leave. And what's your plan to retrain them for requirements are going to change as the business changes. How are you going to deal with those requirements? And or if it's software that you're talking about, upgrades will be needed. Well, who's going to manage the upgrades and what are the implications of that? So you're really, if you're not careful, the sustainability challenge, you've done a great job, made this great investment, but then you're going to be burned in the long run because you don't adapt accordingly. So sum it up, there's really five key pitfalls. Neglecting your people. The challenge is bigger than anticipated. Yeah, identify unexpected roadblocks. You have an inability to execute and the sustainability challenge.  Mitch: (16:29)What are the keys to a successful transformation?  Steve: (16:33)In my opinion, there are seven keys to a successful transformation. The first is a clear, having a clear vision clearly seen where you want to go, what the end goal is, what the deliverable is. Second is alignment. Ensuring that you have clearly articulated the goals and objectives and the resource requirements and have aligned with senior management and aligned with the different teams that are impacted. And the other stakeholders. Third is change management and communication. So you as an individual may see where you want to go or may know where you want to go, but you need to bring others along with you because only with the support of others will you be successful. And to do that, you need to effectively communicate what you're trying to do and work through change management. So once you get to that go live of your initiative of your transformation, people are prepared for that new reality. The fourth key to a successful transformation is trust. Trust within your immediate team, trust throughout the organization. The fifth is seizing opportunities. So sometimes you might think you know exactly where you want to go, but as you're along that journey, ideas pop or or new possibilities pop in front of you and you need to make a choice. Do you seize those opportunities or do you pass them by? And I would suggest you need to be prepared to seize those unexpected opportunities. The six key is having a highly engaged team and having that highly engaged team goes back to quite frankly, having the trust, having really prepared them through a compelling business need and case for change and communication. Having that clear vision and getting them to work with you. And then the seventh key is a having a continuous improvement mindset. Always being open to the belief that you're never there completely. There's always going to be opportunities to do it a little bit better, a little bit more efficient, more effective, quicker, whatever it is. So overall, I would say there are seven keys to successful transformation, a clear vision, alignment, change management, communication, having trust within the team, seizing opportunities, having a highly engaged team, and always maintaining a continuous improvement mindset.  Mitch: (19:08)And finally, how about those who are leading business transformations? Which skills are most valuable and how do you think, a person or a leader can develop and apply these skills?  Steve: (19:22)I would say there's a couple key skills that really helps one be an effective leader in terms of leading to transformation. So first is be an effective business partner, especially as a financial person. If you're the financial leader on an initiative or the outright leader of an initiative, but you're the CFO or the finance director, taking that role, being an effective business partner is first and foremost. Second, in general business acumen. The more you know about your business and the operations and the environment in which you work, the more effective you'll be in defining the case for change. And the compelling business need and leading the project throughout to go live. The third thing is strong communication skills. So as we've been talking through this, that has been a pretty consistent theme I believe you need to ensure upfront that you get people to buy into this initiative that is the right thing to do throughout the initiative. You want to keep them on board, you want them to be supportive and you want to be preparing them for the changes that are coming down the line. And that's all about communication, leveraging every communication skill you have or there's written verbal meetings. The fourth thing is a positive do attitude. So there will be hiccups. We will be roadblocks along the way and maintaining that positive attitude and even instilling that positive attitude in your core team and throughout the organization becomes critical. Another key skill is being are key qualities, being inquisitive, asking questions. And part of that is you might go into the initiative thinking you know the answers or the direction you want to take. However, as you go through it and there's more learnings because you're inquisitive, asking questions, you might realize there's a different direction you want to go that's more efficient or more effective or will allow the business to be in a better place. And then the last, well another thing is attention to detail. So that's one of the qualities we have finance folks really have to offer is our attention to detail. And when you're dealing with a significant project, you know, multiple sub-teams, multiple milestones that attention to detail, ensuring that all the sub teams are on track or moving forward, that all the pieces are coming together. Managing that project effectively and providing that oversight is absolutely critical. And then lastly is having a continuous improvement mindset. So big picture, you know where you're going, but along the way there's always going to be opportunities to do things more efficient, more effective, whether it's in the project management itself or the deliverables of the transformation you're doing. Even once you get to go live, that's not the end. There's going to be further changes. And therefore having that continuous improvement mindset enables you to stay ahead of it versus falling behind it.  Announcer: (22:40)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

IMA: https://www.imanet.org/CMA: https://www.imanet.org/cma-certificationExam Changes: https://www.imanet.org/cma-certification/getting-started/cma-2020-exam-changesFULL EPISODE TRANSCRIPTMitch: (00:05)Welcome back for another bonus episode here on Count Me In, IMA's podcast about all things affecting the accounting and finance world. A major consideration for accounting and finance professionals today is certification and continuing education related to their jobs and responsibilities. And this installment of our IMA focused mini-series within Count Me In, we are going to hear Adam speak with Dennis Whitney. I am a senior vice president of certifications about the CMA, the exam, it's upcoming changes in 2020 and how the certification compliments different job roles. Let's listen now and hear how Dennis and the CMA are preparing our accountants for the future of the profession.  Adam: (00:43)Well to start off, can you please explain your role here at IMA?  Dennis: (00:51)Yeah, sure. Well I've been here now for 25 years. I love IMA. And my role as a senior vice president of certifications is the manage the CMA program and the CSCA program, both the development of the program, the administration of the program, and also the business development, the growth of the program, strategic planning, and related subjects. So a lot of, there's a lot of talk in the industry about certifications. And the first question that probably comes to people's mind is what's the difference between a CMA and a CPA? That's a great question and I get it all the time. And both the CMA and the CPA of course are great certifications and they have a very specific purpose. In my mind, the CPA is geared towards orders and tax specialists. So if you want to go into public accounting, by all means I recommend that you get a CPA. But if you want to work inside an organization, for example, as a CFO, as a controller, as a senior financial accountant or senior management accountant, then by all means I recommend the CMA. And in fact, what a lot of people do is they have dual certification. So they get a certified in both the CPA and the CMA. But again, the CPA is geared toward the auditor's, the professional accountants who are looking, there are outside the organization and they're attesting to the accuracy of the financial statements and also those who are tax specialists doing tax returns. Whereas the CMA's work inside the organizations creating value for the organization through planning, budgeting, preparing the financial statements, decision analysis and related.  Adam: (02:37)So you've covered a bit, you know, about what type of roles are the type of people and the jobs that people cover who are get CMAs, but what's included in the CMA exam?  Dennis: (02:48)Well, the CMA exam is a two part exam. Each part is four hours long with a hundred multiple choice questions and two essays. The content, for part one is a external financial reporting, planning, budgeting and forecasting is the second domain, cost management, performance management and internal controls. And then beginning in 2020, we're going to have a new section, a new content domain called technology and analytics. So that's part one. And part two we cover more of the financial management. So we have financial statement analysis, corporate financial management, decision analysis, risk management, investment decisions, and professional ethics.  Adam: (03:39)So, you know, those are great topics that are valuable to any accountant, you know, who's in the industry. But what's the overall value that the CMA credential brings to an individual?  Dennis: (03:49)Well, it's interesting that when I talk to people about, accounting, careers in general and certifications and degrees from those who have a CMA, I always hear very interesting comment. They say, you know, my degree was great, my CPA was great, but what I use every day on the job is what I learned on the CMA exam, studying for the CMA exam, planning, analysis, decision support, risk management. Those are the things that accountants do every day when you work inside an organization. So, the focus is again, having that critical thinking, analytical mindset. And as I said, with the new exam, we're going to get into data analytics more in technology. So, the focus on the CMA exam is exactly what accountants and finance teams need to do in order to help their companies grow.  Adam: (04:48)So you've mentioned this 2020 exam. How are you adapting to the changing role of the management accountant?  Dennis: (04:54)Yeah, so what we do is every four to six years, we do a job analysis study. So we survey all the management accountants, well as many as we can anyway in the world. And we asked them what do they do on the job, what are their tasks? And then we say, what do you need to know in order to do your job efficiently and effectively? So this is a pretty long survey. It's almost takes an hour, almost an hour to complete. So, we really appreciate everyone who completes these surveys. It's really showing a commitment to the profession. So based on that survey, we look at the content of our exam and we say, what are we testing now that really we should not emphasize as much or what are some, what's some new material that we should be emphasizing more? So, in the recent survey, the two subjects that came up is needing more of a focus on the CMA exam is technology and data analytics. Now we do test stat analytics to a certain extent on the exam now, but with the new change, we're going to have a much bigger focus on data analytics. The other change, which is interesting is we're going to be testing ethics more than we're testing now. We do test that takes quite a bit now, but we figured, based on the feedback that we got that we really should be even more general in how we test business ethics. So instead of just focusing on IMA statement of ethical professional practice, we're going to be testing on business ethics in general, including moral philosophies and the fraud triangle and other subject items like that. Adam: (06:40)So are there any common misconceptions that you hear about the CMA exam?  Dennis: (06:45)Yeah, I think the most frequent one I hear is that the CMA is all about cost accounting and that definitely is a misconception. Now we do, we did have our Genesis in the cost accounting profession back in 1919 when they met up in Buffalo and created what's the IMA now it was really about cost accounting and cost management, but the profession has changed so much and it's broadened. Management accountant has broadened, broadened so much that really the focus now is on cost accounting. Yes, that's, but that's a small part of the exam. It's really about planning. Risk management analysis analysis I think is probably the biggest key. And having that analytical mind is something that CFOs want to have. They want to have people like that on their team. So it's not just, you know, counting the numbers, doing the bookkeeping, so to speak. But it's helping companies identify what's their competitive advantage, what drives value. So to help the decision makers make the decisions that can help the company, create value and be successful in the long-term.  Adam: (08:06)That's great. So we've talked about common misconceptions. Are there any other frequently asked questions that people often ask about the exam or the credential?  Dennis: (08:16)Well, there's a number of them. It depends. Some of them are geared specifically to the exam and others to the profession or the program itself. So someone might say, well, I have an MBA in finances and that good enough, the MBA and finances is terrific and complementing an MBA in finance with the CMA is really a powerful resume booster. The MBA in finance, there's probably two types of MBAs and finance. One, it's a very broad degree. So you're going to get a little, uh, accounting, little management, accounting and financial accounting, little more finance, corporate finance, some it and marketing, good foundation. But when you get on the job, you're going to realize that you need to go into a lot more depth. All right? And the CMA is where you have a laser focus on management, accounting and corporate finance and what you need on the job, not the broad education, which could be a very good education but, but you really want to go into more depth. And that's what, that's the difference with the CMA. And then for the exam itself candidates often asks, well, how long do I have to take it to pass the two parts in the answer there is three years, which for most people is more than enough because in fact the average time it takes for people to complete those two parts is a year and a half. So that's really not it's not too long, you know. And then other questions are, well, how much time do I have to study? You know, we recommend around 300 hours of study time and each person is different depending on their background. But you have to create a plan, a schedule, and make a commitment. Make a time commitment that you with with yourself and with your family and your employer that you know what, I'm going to spend the next six months studying for this. I'm making an investment in my career. I'm going to be helping the company and developing new skills that I'll be able to use the rest of my life. So it's a short term investment for a long-term gain.  Adam: (10:28)I want to remind all of our listeners to check the show notes for links to the CMA exam and more information about it. So as we kind of, you know, end this conversation, it's been great chatting with you. You know, what are some suggestions or recommendations do you have for people who are preparing for the CMA?  Dennis: (10:44)Well, as I said before, I think the biggest one is to make the commitment and realize that you're are going to have to make some sacrifices, but it's only for the short term. You do have to work hard, you have to study, but you have to think about the goal and where it's going to take you in your career because it really will make a big difference in the long-term in your career. It'll give you more confidence. It'll give you global portability in terms, it's like a global passport because the CMA is a global certification. It'll give you more credibility and it will also, most importantly, give you the skills that you need on the job. And I also recommend for those who've completed their CMA and all finance and accounting professionals in general, excuse me, is to make a commitment to continuous education. Okay. Because it doesn't end after you get your CMA, you have to continue to continuously learn in this profession because the profession is changing at a very high rate. So make a commitment to continuous learning. Get your CMA, get another certification. We have a CSCA, in addition, we have great continuing education courses, get a certificate online, but make that commitment to continuous education throughout your career. So just one last question. How do you think the profession is changing and why? Where do you see it going? Well, the profession is changing at an unbelievable rate right now. I mean, you know, I've been involved in the profession for quite some time and there's always change and, but it's the rate of change now and in the significantly significant aspects of the profession that are changing. So with artificial intelligence and robotic process automation, some of those routine jobs are going to go away. But the way I look at it is artificial intelligence is really augmented intelligence. It's another tool that we have to use as we help our companies grow, identify the value drivers. So I think, um, AI and RPA, blockchain, those new technologies are really going to impact the profession. And, but I think it's a good thing because I think our, our professional will become even more interesting, more analytical and less routine. So I encourage everybody to embrace the change, but make sure you develop the skills that you're going to need to take advantage of that technology. Okay? You don't want to be outplaced from your job because of technology. You want to be able to take advantage of that technology and grow into a more interesting job. So continue to learn. Get certified. And if you're already certified, develop new skills to make sure that you're relevant and, have a long and fulfilling career in management accounting.  Announcer: (13:55)This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you liked what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

FULL EPISODE TRANSCRIPTMitch: (00:05)Welcome back to Count Me In. I'm your host Mitch Roshong and this is IMA's podcast about all things affecting the accounting and finance world. For today's episode, we're going to take a look at the education that is impacted by our changing industry. As we hear Adam talk with Luke Harris, associate at PWC as he explains his recent accounting studies and the experiences he's found most helpful in entering the profession. Let's listen to their conversation now.  Adam: (00:37)So I understand you studied international accounting and logistics globally. Can you tell us a little bit about where you studied and what the most interesting aspects were of accounting in each country?  Luke: (00:47)So I first studied internationally in France as part of a one semester exchange program. I was based out of Rin just about two hours by train outside of Paris. And this afforded an abundance of opportunities both personally and academically. Knowing that there were international standards that varied from the generally accepted accounting principles, views in the United States. I was really interesting to me going into it. But after taking a variety of classes, I actually noticed how similar the two sets of standards really are and how much they're converging with recent standards updates. For instance, the revenue recognition standards and the least standard, both of these making gap more principles based to align with Ivers, which has historically been more principles based. I noticed that with logistics. I believe that my greatest aha moment was realizing no matter how small of a business you going to be are if not directly connected to the global network of trade. You are more than likely just only once removed from multinational firm, whether upstream from a supplier or downstream through or consumer of your product or service. And that was really big for me, realizing that there's really no way to avoid the global effects of currency fluctuation, cyber risks, sustainability and economic and political environments, which of course necessitates a many ways in which we can hedge those risks, which I find really interesting. I later studied logistics and Chile, which was remarkable physically speaking, just seeing the port in Valparaiso, the only major port in the whole country was incredible, but then learning the political and economic past and the influence that the U S and other countries have had in affecting their economic system was just amazing.  Adam: (02:32)So I've read you've done some research in cyber warfare. How have you been able to connect your international business studies to what you've learned about cybersecurity needs?  Luke: (02:43)Good question. My main takeaway from my research and studies is that this is an area anyone working on any sort of network I should feel competent with. And I mean anything. If you check your emails, convinced an online ordering, utilize any cloud computing, this is something you need to be familiar with. And somehow we think as the cloud gets more pervasive, it gets safer, right? As it gets larger, it gets safer as if there is a security in numbers that somehow more users make it safer. But when you think about it, that rationale is flawed. When I am using, say, Amazon web services, whether directly or indirectly through my school or work, I am opening myself up to a field of over 1 million users. And of course I'm relying on both the provider and servicer for adequate separation controls. And, uh, let's say if modern ground transportation, puts the country at our fingertips, it's the online web and cloud computing that have put the world at our fingertips. Now, the unfortunate side to this, the other side of this is that it has put us in our organizations within reach of bad cyber actors across the world, right? So that can be really intimidating knowing that really any bad cyber actor from around the world could potentially access my data if it's not properly secured. Your complication with mini servicers can also cause problems with cyber warfare specifically? I was shocked to find the ability and motivation by many nation States, uh, to disrupt multinational corporations. And if you look at the major cyber attacks happening in the past few years, many perpetrators were in nation States. But at the same time, it's almost as if many MNCs have placed the concept into sort of a buzzword box and not fully grasp the gravity of the issue at hand. Secondly, if studying cybersecurity, I believe it is very important to not limit your research to your country of business even if you don't have international dealing because you again are more than likely just once removed from an a multinational corporation and you do have international exposure if you are on any sort of public network.  Adam: (04:52)So how have your various volunteer activities benefited your career.  Luke (04:58)As an individual, studying and working in accounting, I tend to get very focused into one particular area of interest at a time and I feel voluntarily volunteering and I think volunteering has really helped me in this area and it's helped me realize my place in the world as a human characteristic. We share with the over 7 billion of us on this planet. So even though I may be an accountant or a student, and those roles come with particular obligations of ethical behavior, technical competencies and academic orientation. But more than that, I'm an individual capable of having a positive impact on my society in a volunteer capacity, developing mentor, mentee relationships or volunteering with the nonprofits such as professional organizations, your house of worship or your local food bank, or always you can contribute to your community. Just find something you're passionate about and get out there to help as you can. And I think the natural byproduct of this behavior is realizing every activity you engage in, whether in the workplace or without the workplace impacts a variety of people, people you know, and people you may have never met. Consequently, the more you feel connected with those people is a crucial understanding to working within organizations and on teams. And that really touches on a second aspect of volunteering, which is developing empathy in the traditional sense. When volunteering, you are serving a group of people distinctly different than that, which would be representative clients and you're doing a service without monetary compensation. Inherently, this behavior opens up your field of exposure to new people and their lived experiences allowing you to understand new cultures and behaviors of people. It really fosters a profound and pathic understanding a skill, no doubt, beneficial to nurturing personal relationships, but also a skill absolutely required in the world of business. We're understanding of consumer's greatest need is paramount for success.  Adam: (06:50)Just from personal experience, I've found that volunteering not only, you know, helps me in all the ways that you've mentioned, but also just on a personal level, you recognized how much value was in the time that you give to whatever you're volunteering for and you just in some ways just feel better as a person.  Luke: (07:09)Absolutely. Yeah, there kind of comes with that, like a nonphysical, maybe psychosocial, I don't know, application. Yeah.  Adam: (07:20)So as a recent graduate, did you notice the accounting curriculum change as the industry and profession evolves?  Luke: (07:26)Yes, I do see change in accounting curriculum. However, from my experience, it doesn't seem that academia is capable or is really designed, in fact, to evolve at the pace private industry evolves, especially in this world where data is exponentially increasing year by year. If you think about the time-frame of publishing a journal alone, it could take years worth of data, months of writing and editing and then months of review before it's even published. And there's the time it takes to disperse the findings, get them in the textbooks, and then convince professors it's worth teaching. So while there is value in this process, I understand that as a student it was very impactful for me to attend conferences and develop professional relationships to make sure I was staying on top of the new information coming out in my field of study.  Adam: (08:20)So on that same vein, do you think, do you have any concerns that your accounting degree will be still relevant in 10 years?  Luke: (08:27)I do believe the information I learned through my courses will increasingly be less relevant to the current environment of business. But honestly, I'd be very skeptical of a recent graduate who viewed any degree as the certificate of success for today. I view my college career as a prerequisite for success in the area for which I have a desire to work. It is nourished to desire to know and understand. It does improved my ability to analyze issues, brainstorm solutions and implement solutions. But by no means do I view as sufficient for the future or even now for that matter. I believe reading professional journals and books and it's sending conferences and developing relationships with other professionals is really what will make you indispensable to your clients, colleagues and firms. I do hope that academia will continue to have a large impact on establishing the thought processes of the young and the world and I place much value on having that shared four or five year experience where a portion of that education coverage general topics of our world. I'm excited to see what that looks like 10 years from now and hopefully industry professionals will continue to be invited onto university and school boards to have a say and how that evolves. Well, I do believe a lot of the information I learned through my courses will increasingly be less relevant. I believe that real desire to learn is really what will have an impact in the future as data exponentially increases day by day. And we have all of these new technologies coming out. I believe what will be a factor in success for these new professionals will be their desire and ability to learn and adapt. And I believe that's something you learn through a college experience. I think one of the most interesting things for the future of accounting, which I am so glad to be coming in at this stage, is figuring out really on how to report on intangible risks. We have companies like Netflix that have more intangible assets, the tangible assets by far, but with that comes in tangible risks and we really have to consider it us as accountants, are we really even considering those risks deeply enough and are they being shown on the financial statements? And if not, how long will financial statements be relevant if we do not somehow find a way to get those risks either monetized or into some sort of report within the financial statements, to educate those potential investors and shareholders or stakeholders in the company.  Adam: (10:54)Now, do you see anything, like, have you seen any technologies or any things that, that would be able to help report on those intangibles that you just talked about?  Luke: (11:02)I do believe audits within information systems will continue to be beneficial. Um, but as far as a construct or a platform for presenting that data, um, I have not, I not in the profession yet. So, you know, 12 months from now I may have a better grasp on that. But, I do know there are a lot of academics who are putting a lot of work into this, but I have not seen anything as of yet.  Announcer: (11:35)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

WBCSD resources: WBCSD COSO Applying Enterprise Risk Management to Environmental, Social and Governance-related Risks  Guidance on improving the quality of ESG info Enhancing the credibility of non-financial information: the investor perspective How to respond to assurance needs on non-financial information IMA resources: https://www.imanet.org/insights-and-trends/external-reporting-and-disclosure-management/coso-framework-and-sustainability https://www.cpajournal.com/2019/07/29/the-coso-internal-control-framework-and-sustainability-reporting/ https://www.imanet.org/insights-and-trends/external-reporting-and-disclosure-management/sustainability-cfo-the-cfo-of-the-future https://blogs.thomsonreuters.com/sustainability/2018/08/09/executive-perspective-the-reasonable-millennial-investor/ Contact our guests:Shari Littan - https://www.linkedin.com/in/shari-littan-58bb40114/Mario Abela - https://www.linkedin.com/in/mario-abela-75a95957/FULL EPISODE TRANSCRIPTAdam: (00:00)Hello again and welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. We have a unique episode for you today as both Mitch and I facilitated a conversation with two guests to provide multiple perspectives on the topic of sustainability. We spoke with Shari Litton, IMA's manager of corporate reporting and technical activities and Mario Abela, a director for redefining value at the world business council for sustainable development. Let's head over to the in depth conversation held about topics relating to sustainability such as ESG and integrated reporting.  Mitch: (00:36)There have been many articles and publications for guidance on sustainability. So to start things off, what is sustainability and why are organizations so concerned about it?  Mario: (00:53)Thanks. There are many definitions of sustainability from the very narrow, it's just about the environment through to the inter-generational legacy that we leave for future generations to be able to kind of enjoy the same, lifestyles and the same resources that we've been at today. So the term doesn't really have any fixed meaning and it continues to evolve at the WBCSD when we talk about sustainability, we really looking at the sustainability of the business model. Can the business continue to operate as it's currently doing? Can it sustain those operations into the future?  Shari: (01:47)No, I just want to recall that for me, when I first became fascinated by what we'll call accounting for sustainability or sustainability or integrated reporting. I always recall my reaction to the first photos that the astronauts sent back. One of the famous photos is called Earthrise and you can actually see the earth rising from the surface of the moon. And many people say that the modern environmental movement started with that photo because all of humanity reflected back on what a small planet that we have. And to me, coming with an accounting background, I think of one of the primary goals of why we have accounting to begin with, which is we have limited resources. And that picture coming back is a stark reminder that limb resources here on earth are limited. So we have to be a little bit broader or maybe evolve what account for how we're using those resources. How are we all allocating our precious resources, what are we doing with them? So for me, that one photo ties back to accounting. And when I am thinking about sustainability and business, for me personally, that's where I come.  Adam: (03:23)So then what kind of relevant data is available for sustainability and how are businesses reporting this information? In other words, what is the current challenge?  Mario: (03:33)The problem is that the, the relevant data is a really good so there's been a number of surveys done by the CFA Institute and other investor bodies that have demonstrated that there is actually no shortage of data and to some extent information, but that information is not particularly relevant to the sorts of decisions that investors and other stakeholders need to make. So if a board would ask management about the reliability, a lot of sustainability metrics reported today a lot of CEOs would struggle to really put their hand on their heart and commit to the credibility of the data. And in fact, PWC in its CEO survey looked at what are the sort of key decisions that CEOs, Nate, about their company, what sort of information are they getting and to what extent do I have confidence in that information? And for a number of data points where these things are absolutely critical to the business and its value creation, in fact, they either don't get very data or the data that I get I have very little confidence in and we have to remember that a lot of this data is not subject internal assurance. So often it's not, there are reviews done by internal audit and it's also not subject to external verification either. And, and the other point is that companies now report as you know in many different through many different channels. So the 10K is just one form of reporting that companies report, you know, every minute through social media.and then there are news outlets and others who are also providing information about companies. And we did some work last year where we went around the world and, and spoke to investors about ESG information. And one of the things that I told us was that at the moment, because there's the lack of standards or at least a single standard because there are, many frameworks, many standards of sorts of we've identified at the WBCSD. In fact, we have countered at least 200 frameworks with over 5,000 indicators. The problem for investors is comparability. They've, they've got no idea how to compare one number against another number because the basis upon which those numbers are calculated are often very different. And so what happens in practice is that companies use a mix of measures from existing frameworks and then often adapt them to their own requirements. So we have the entities specified criteria which makes it even more confusing. And the other issue in all of this is that at the end of the day we have, we understand our accounting calculations. We know that making a profit where there's a kind of excess of revenue over cost is a good thing. And that's what companies should do. And we know that making a loss, particularly a piston loss is not a good thing because it means that there isn't sufficient revenue to cover costs and also reward the providers of capital. But when it comes to a lot of these sustainability areas in the social and environmental domain, it's less clear. What's a good number for the percentage of women on boards? Is it 20%, is it 50%, is it 75%. So these normative judgments about, well, what's good are very difficult to make. And, and so that is also an issue for investors because even on greenhouse gases take two, you know, comparable S&P companies with very similar activities. What's a good number in terms of their greenhouse gas emissions? Well, it depends, depends on stakeholder. It depends on what outcomes in particular you're trying to pursue. So, there are lots of challenges really in not only pulling this information together, but then in making sense of it.  Mitch: (09:17)And how about specific to the finance and accounting team? What role are you seeing CFO teams and these finance and accounting professionals taking with respect to sustainable business performance information?  Shari: (09:29)Yes, so what we're doing at here at IMA is where taking a little bit of a listening tour for our constituents who mostly sit in what I'll call a CFO unit or finance and accounting on the corporate side. And here's what we're hearing, that the gathering and reporting of what we'll call sustainable business information has grown up outside of their unit. That it's primarily by a unit with a title of a corporate social responsibility or sustainable business, but outside of the, what we'll call the mainstream finance and accounting unit. But as the company focuses more or takes more initiative and progress's in its understanding and its desire to use this perspective for we'll call longterm performance of value creation, it's inevitable that the CFO team members of finance and accounting are getting involved. And when they do, it's amazing. What they tell us is that suddenly there's a new different eye because the CSR teams, as Mario says, can be sitting on tons of data that's really valuable and talks to various aspects of the business that haven't been looked at before. But that data needs to be a analyze with that professional eye, the rigor, the professional experiencing auditing and controls and bringing vigor and rigorous oversight to the data itself. Here's what once said is that our finance team, they don't take our numbers at face value. As that progresses, we see that the finance team, the accounting and finance team takes even more of a role. They get involved and they start saying, well, why can't we get better data? Can we put some of these metrics into our mainstream ERP system? So we have some oversight, we know what we're gathering and we know what we're reporting on and see companies that as they take steps to understand what investors are demanding to look at the various frameworks that Mario talks about and say, well, what's most relevant to our business? That takes that finance and accounting eyes sometimes to say, how do we put it all together? And the people who are sitting in what I'll call the CFO unit have that expertise to help bring that forward.  Adam: (12:21)So then to connect us all together, what are the benefits of the involvement of corporate finance and accounting professionals?  Shari: (12:27)So as I mentioned, when we see members of the accounting and finance team get involved in sustainable business information internal and then for external reporting we see more of a compliance mindset. And in some cases actual controls that traditional COSO framework can be applied. And that oversight of the data as, because in many ways the flow of information, whether it's sustainable business information or strict monetary information, it's a similar process. You're deciding what you're going to report on, you gathered the data, you summarize it, you analyze it and put it in a report whether for internal extent or do you use for decision making. So that process is the same when we have that control and oversight internally over the data. When that finance team brings that expertise it enhances the quality of the information and enhances the reliability. So it makes the whole reporting process. It makes the activity of looking at your sustainable business activities more relevant, more reliable. It brings credibility to it and their buy creates value just by deciding on what information is good and what information is less good. And this also helps, as Mary was saying with the view of the marketplace because as companies are able to understand and speak to these issues and begin to incorporate them with an enterprise mindset, it does speak to investors and other stakeholders. And in fact it shows indicators of good governance that management is looking at these issues that they're not narrowly focused and that helps engage with investors and other stakeholders. And as Mario mentioned, can be way to engage longer term investors and lower your cost of capital. And we're seeing the research bare that out.  Mario: (15:01)Just to follow on Shari. We did some research in 2018 where we looked at, we extended the study we done previously and we looked at some of the largest companies in the world and we looked at a 10K and what they've reported in terms of the risks and then we look to taste sustainability reports and for the same companies we found that only 8 percent had the same risks listed in a sustainability report as I did in a 10k or, or statutory financial filing, which is a kind of staggering figure, but it really just stresses this point back with sustainability information. Often we're not talking about, we're not starting with a single source of data. And so there are a number of preach conditions we need to satisfy in order to be able to implement some of the measures that we would take for granted when it comes to financial information. It's also the nature of that information I share is pointed out earlier on. This is a diverse set of information. Some of it is monetized, some of it is not monetized. If we're talking about greenhouse gas emissions, what do you see? These aren't necessarily monetary amounts. We are looking at converting to some sort of physical amounts. So there are all sorts of complexities and it really stresses the importance of the finance department work very closely with the sustainability team to understand some of the inherent challenges in the title itself. And yet, the other point of make is that and it's in the COSO framework but internal control framework but often overlooked and that's the cultural dimension to an effective internal control environment.  Shari: (17:27)So one of the things that we hear again and again is for many companies is how did they get started on the pathway and to start thinking about how to address some of these issues. Almost always I will hear something about senior management. Our created some initiative. Our CEO went to Davos and came back with ideas and there was a lot of initiative and a lot of innovation in very many cases as it does start with a spark or insight or some step by senior leadership. And then we start to see the 2020 vision plan or something along those lines. And that's where many, many companies first start to get that bigger handle, that broader picture before they start getting more into the detail.  Mitch: (18:33)So along the lines of this spark and the ultimate benefits that are brought up, I've heard you both mentioned the term value creation. So how does this tie into the concept of the CFO as a value creator?  Shari: (18:49)Oh as we've mentioned that what we're seeing is that initiating a sustainable business program or projects or initiatives or responding to new investor demand for information or the desire to take a more enterprise approach is the collaboration that takes place. So while much of this grew up in a corporate responsibility teams to take it to the next steps, to invigorate, to bring that business case. When the CFO team, finance and accounting gets involved, that tends to start to happen. And it also brings in other teams, investor relations. In other cases, it brings in even further collaboration across the enterprise environmental health and safety people, HR people, because they're holding onto data and metrics as well. And that brings that enterprise view across the organization.  Mario: (20:11)I cannot add Shari that there's of value creation value creation and value production dimension to this that say photos are increasingly you know, front of mind, for example sustainability issues often incredibly important risks to a business and with in its annual survey of global risks, a has year on year started to identify that financial risks are less important when it comes to significant business risks and other factors like environmental and social factors having a much greater impact in terms of destroying value within companies. And then the other side of that is opportunities. I mean, CFOs, part of their role is to ensure that the company is seizing on opportunities to grow and expand a product and to grow their revenue and markets. So, so there's kind of two sides to this coin important to hold together that there's a significant risk dimension. So that's why this matters to the CFO, but also there's a significant opportunity dimension as well. And we've seen companies that have become much more sustainable attract a lot consumers, sales, a lot more consumer interest and loyalty. So there, there is an important dimension here that a CFO is in terms of that intangible value are starting to recognize.  Mitch: (22:06)So just to kind of wrap it up, you know, if someone would like more information about all the stuff we've just discussed today, where can they go and what resources?  Shari: (22:15)Yes. So I will say that one of the things that I'm observing is an incredible uptick.some of the things that we've observed in the past are changing and they are changing fast. So in the past, maybe year to year and a half, there's been an incredible movement. Investors are a big driver. Attention to climate change is a big driver. The concerns of the next generation as millennials take more prominent roles and actually become investors. So we're seeing a lot more attention to movement. So we at Ima are going to be looking into these issues, how we can support our constituents in the accounting and finance roles as they learn and evolve and take on some of these broader concepts for the specific issues of enhancing the quality and internal controls over sustainable performance information. I invite our listeners to review a paper that we produced a few years ago by Jeff Thompson, our CEO, along with Bob Harris, who is the former FASB chair and a member of the SASB oversight board today. They put out a paper a few years ago that actually looks at applying the COSO principles to these new information forms. And a summary of that was published recently in the CPA journal of the New York state society of CPAs. I also wanted to say how thrilled I am to be collaborating with the world business council for sustainable development and the great research and work that they're doing. Thanks Mario.  Mario: (24:17)Thanks Shari. And in terms of our resources as a member body and our members some of the largest corporations in the world, we have worked with companies to take the COSO work, for example, on enterprise risk management and look at how ESG related issues can be embedded within that process. So it's not about a new process, it's about a much more integrated process. And so we have available on our website, which we produced in conjunction with COSO guidance for applying enterprise risk management to environmental, social and governance relationship risks. And we also have on the specific topic of internal controls guidance on improving the quality of ASG information for decision making. And we developed that with companies in Denmark and the Danish accounting body, they FSR. So it's very much a kind of practical guide in terms of where to start and how to progress on this journey to ensuring that we have much more credible is ESG information. And so we're, we're thrilled to be working with IMA on this project and our common interest really for the profession really to advance and really step up to the challenge that the world and, and all the turmoil is presenting for accountants in having businesses succeed in environments that are a lot more uncertain and a lot more volatile in the past and ensuring the value is created. Nonetheless,  Announcer: (26:21)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Keith: https://www.linkedin.com/in/keithlewiscma/Keith's website: https://www.keithericlewis.comFULL EPISODE TRANSCRIPT Adam: (00:05)Welcome back to Count Me In, IMA’s podcast about all things affecting the accounting and finance world. I am your host, Adam Larson, and this is episode 35 of our series. In a moment you will hear Keith Lewis, management accountant and an international speaker share his big picture thoughts on how individuals can utilize best practices and develop the skills needed to set them apart when looking to build their own brand in today's competitive accounting market. Keep listening now for more details in his full conversation with me.  Mitch: (00:39)What steps does one need to take in order to really quantify their skills on a resume?  Keith: (00:45)Well, Mitch that's a great question and one of the things that you need to focus on is three key things that you want to focus on is how many, how often, and how much, how many people have you interacted with? Did they span across different business units on a horizontal level? Did you go up to the higher ups, the C level executives on a vertical basis, and how many individuals were you able to touch in terms of your reach within your position? The second key thing that you want to focus on is how it walked in. Was this a daily task or the weekly, monthly Semi-annually, or annually and then finally how much, how much were you able to save the company or make the company by the process that you were taken in order to get results driven action? How I take it back to an experience that I had and a couple of the positions that I've worked in, I created standard operating procedures, which is also known as SOPs. These things were put in place for our new hires and assisted with the in the onboarding process. This save time during the time that they were being on onboarding and it helped the employees to be come more productive sooner than normal.  Mitch: (02:08)So what strategy goes into how you want to be perceived by the employers once you're able to quantify this on your resume?  Keith: (02:17)Another great question. The dots for your brand will be connected via the combination of your resume and your social media platforms. Somebody has checked your platform, your LinkedIn, your GlassDoor to see the connections that you have and how is it aligned to the resume that you're presenting. You need to stop viewing yourself as a company of one. You're here to provide a service for a company either via W2, 1099, or direct B2B if you're a business owner. Finally, you are a sales consultant and the best product that you have and everybody wants is you. You just need to know how to actually quantify your skills, know what your value proposition and presented to the individuals.  Mitch: (03:04)That's a great point. And now once you're able to quantify your skills and you kind of have this perception that you're looking to display, what is the best way for you to utilize something like LinkedIn when it comes to building your brand and further establishing who you are?  Keith: (03:26)I like to use LinkedIn as my canvas. I remember at one point in order to reach out to the decision makers within a company, you have to cold call the company, act as if you weren't who you were in order to get a contact. Just to be able to reach out to him. Put your best foot forward. Now you have tools like LinkedIn where you're able to wait the decision makers within the company that you may want to go to or get interesting information from companies that you've seen information about. I think that this is very important that you have a consistent message on your LinkedIn that is really cohesive to what you are representing on your resume. You want to create posts that helpful that to provide insights to individuals and give them actionable items that can better their situation no matter what position they're in currently. Mitch: (04:23)How can we further differentiate ourselves from all of the other applications though? What's another tip that I could do to separate myself from others during the interview process?  Keith: (04:36)Well, this is a great thing and I'm a true believer that one of the best ways to separate yourself, there's a thank you card. I've been able to position myself in a lot of great opportunities based off the fact that I did a thank you card. It seems to be very rare, but the one thing that people don't take into consideration is that when you're asking the questions at the end that every interviewer asked you if you have, you have two purposes. One is to further build that common ground, which with whoever you're interviewing during that time and two, you want to provide the basis for your thank you cards. So when I crossed my handwritten thank you cards, I specifically make an effort not to discuss the position at all. All I want to do is thank them for the opportunity that they'd provided and taking the time out to actually meet with me. I focus on common ground building items during the interview instead. An example of that is one of the thank you caused that I've crafted during one of the interviews at a company I interview for, I found out that they had young children through my questioning and I mentioned to them that there was a guy that was based out of Philadelphia named grandpa bubbles that hosts different free events in the parks in the surrounding area. Now totally it was something that she may be interested in and even provided the website for. She really appreciated that because it wasn't about, the interview wasn't about the position. It was really about just building that genuine connection and that's what you're able to do through a thank you card.  Mitch: (06:13)Just as a quick follow-up to that question, what is the benefit of a handwritten thank you card as opposed to, you know, the more traditional email today?  Keith: (06:25)Well, I think that a handwritten thank you card, it shows the efforts. It's very easy to go online and just write some type of email that you send out to somebody. It seems very generic and is not very personable. I feel that the handwritten, especially if you're doing a handwritten thank you card, it shows the time and the effort and the genuine interest of this person to actually want to reach out to you and thanks. Good.  Mitch: (06:53)I think that's a great piece of advice and you've been able to share some of your personal experiences. So I'm just kind of curious, what do you think has been the number one marketing tool that you've been able to use when approaching other companies?  Keith: (07:08)I think that's also another excellent question. I think that there's a number of things that I've used and been able to do that helped me and my upward mobility within the different companies that I worked for. I would say obtaining the CMA certification has probably been the number one marketing tool that I've had up til this point in my career. Expertise and understanding that I have been able to gain from the breath is knowledge that's contained within the learning outcomes. It's going to set you apart instantly. My first hand, ability to apply them into companies that I've worked for also added to that marketing scope op game. You'll notice that although the CMA certification is still growing, companies are more and more starting to look in that direction when they are looking for their possible candidates. Companies like J&J, Amazon, eBay and many others on that list,  Mitch: (08:06)Can you just share some of the accounting skills and knowledge that you have been able to learn and develop and apply because of this certification?  Keith: (08:16)Absolutely. And my current role at FEI, I currently work on the corporate accounting technical support team. In addition to that, I'm also involved in the analysis piece in paying our managers as well as our clients. And one of the skills that we also utilize or one of the skills that I also utilize is in the budgeting scope rolling over budgets on a monthly basis. It can be very tedious and an understanding that I'm been able to gain through that process. Awesome study from the CMA as well as the analysis and various analysis from the standpoint of even looking at WACC and the cost of capital has been able to help me tremendously in my current role.  Mitch: (09:02)Finally, what advice would you give to those that are currently working to build their brand? Maybe those who don't know where to start, you know, how have your experiences allowed you to provide some guidance or insight to those that are looking to advance their careers just like yourself?  Keith: (09:21)I think Mitchell is very simple. I would say that the very first place you need to start is with yourself. You need to really do it. Honest self reflection. Who are you? What is, what are your capabilities? What are your shortfalls, and what do you need in order to fill the gap? You also need to know what is your story? How do you tell your story? We all come from unique backgrounds, experiences, challenges, and successes. Don't be afraid to share those. You'll be surprised how interjecting the human element to the workforce can pay extreme dividends.  Announcer: (09:59)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Brian Kush: https://www.intend2lead.com/brian-kush/ Top 10 Books for Accountants: https://www.intend2lead.com/top-ten-books/ Intend2Lead: www.intend2lead.com FULL EPISODE TRANSCRIPTAdam: (00:00)This is episode 34 of Count me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson, and I'd like to welcome you back for another great perspective on the skills needed to succeed in today's accounting industry. For this episode, Mitch spoke to Brian Kush and executive leadership coach and the co-founder of intend to lead. Brian explains the importance of strong leadership and personal development when trying to create a sustainable accounting career. Let's go to the conversation to hear more.  Mitch: (00:36)One of the central competencies for our accounting and finance audience revolves around leadership. What natural leadership and coaching skills do accountants commonly possess? And tell us a little bit about what you do to support that skill set.  Brian: (00:58)Right, Mitch? So I always think of maybe an overused term in our industry, in the accounting industry is the idea of adding value. however, I feel like accountants are really good at that. I feel like they bring a value added mindset to everything that they do. And so some of the natural leadership qualities that they possess or that I find in a lot of accountants are, they're very good and open about sharing with each other and learning from each other, different in newer ways on how did you do things, you know, it might even just be, Hey here, allergy and, you know, here's what our firm or here's what our organization does. And, and, and being very good about sharing it with others, you know, and trying to learn from each other, whether it's you're in public accounting or if you're an internal audit shop, it's like how can we learn from other entities that are out there and really having that learning mindset in a way where they're sharing well with each other there. They're building upon each other. In some cases. It's brainstorming. I've done a lot of facilitated facilitated work or I've been here, well work with accounts even at different companies or firms. And it's just amazing and it's inspiring to me how well they are, are good. They are an open that they are about sharing new ideas and ways to improve and just really supporting each other in that way. So it's cool for me to be able to see that. I think that's something that accountants naturally do. I think accountants are also very good goal setters. You know, we have to be, and a lot of the, the work that we do, we have to set milestones. So how many of the projects that we're tasked with doing are not easy. They are complex and you have to set multiple milestones. So accounts are good at that when they're somewhat forced to do that and intend to lead. We're, you know, we're a leadership development company and we do a lot of coaching with, with accountants and one of the things we like to do is we like to really work off of that off of the idea of the learning mindset. How can you uncover, you know, what's really important you, how can you learn from each other? And coaching is really about helping someone to learn more about themselves and to move their acts just forward in their life. And so we like to tap into their learning mindset. And figuring out ways that they can progress in it, they can improve. And we like to also tap into that goal setting mindset where it's like, Hey, where do you want to go in your life? What's important to you? And how do we create a road map on how to get there? And that's what coaching is about. It's about, you know, where do you want to go? What are you now, what's the gap, you know? And as a coach, I'm going to help you to create a roadmap and an intentional way for you to move your learning and your actions for us that we can get to where you want to go. And by doing that, you can grow your skills as a leader and grow your influence of others.  Mitch: (03:50)Now that's the perfect segue to my next question because I'm curious, you know, kind of being a former accountant now, working with many accountants, what are some of the common goals that you've come across from these accounting leaders? What are they typically attempting to reach and what kind of roadmaps are you putting together for them?  Brian: (04:09)Yeah, Mitch. I think one of the most common goals that they have, it's really a, there's a big emotional part of this, but there's so many accountants out there where they, they want to, they want to feel bold enough to be able to create the life that they want in the future that they want and they want to feel like they have enough power to carve their job around what they want instead of, and let me compare that to sometimes how they feel. And it's usually fear based. It's usually all about struggle. A lot of times they feel like, wow, I've got this job and I've got to carve the rest of my life around my job because everything in my job comes first. And this is the way I've seen my peers do it. Or this is the way I've seen the people that have come before me do it. You know, job comes first. What I need to do comes first and the rest of my life is around that and what I love is we've worked with a lot of people with a lot of big hearts and they want to be bold and they want to create that future as they want it. Not always as how they've seen it. And so what they do is they want to have the boldness to say, Hey, can I visualize the future that I want? If I want to make partner in accounting farmer or if I want to be the CFO, can I become a CFO at this organization in a way where I can create the life I want? And the job of CFO or the job of partner fits into that. And, and so it can be the life I want sort of a life of someone else's or another type of model that's been created for me by somebody else. And that's really challenging for them and that's really, I think at the heart of what their bigger goals are, which is that life that they want and making everything and helping everything to fit into what is it they want. And.  Mitch: (06:04)What are some of the challenges that you typically encounter when trying to lead these accounting professionals through this plan that you develop or, you know, down this road? You know, the, the, the challenge is first kind of separating that emotional piece as you said, but once you're kind of on track, what typically happens?  Brian: (06:24)Yeah, it's unfortunate, but we've worked with a lot of accountants where they feel overwhelmed a big part of the time. And so they might ask, how do I take care of myself so that I don't burn out even when I'm really busy? You know, and you know, how can I work with my stress? How can I be proactive with my stress? You know, and this is to me in a lot of ways is a foundational challenge because whatever other challenges I made share with you are very common in our industry. This one is going to affect it, you know, so how do I manage my stress? How do I manage my anxiety and all that? And if I can do that well it's going to help me with so many of my other goals and so much of my vision and where I want to go. You know? And, and we always say, Hey, you know what, in order to do that, you have to be able to have a plan. You have to be intentional about it as it relates to managing stress. You can't be reactive. I've worked with too many people that are in their sixties or even their seventies and you know, and, and not all of them, some of them have thrived, but some of them, they're at a place now in their life where, wow, they're, they're actually facing medical challenges and they're facing some issues because they didn't think about stress earlier on in their career. So I feel like the earlier on we can actually be intentional about thinking about these things, which is like what is my self care plan? That sounds like such a basic question, but just asking yourself early on, what is my self care plan? What am I going to be able to do to be intentional about some of the basics in my life? Things like such simple things like exercise and diet and sleep and what are the routines that I can put into my life that helped me to proactively manage stress. You know? And those can be things that are simple like meditation and you know, breathing techniques and, and having the ability to go exercise. And you know, accountants struggle with self care cause they don't feel like they've been granted permission to think about that. Okay. But if you think about your life, doesn't it need to start with that? Shouldn't be that, that the center of everything, you know, which is what is your plan to be able to be a human being. You know, instead of being like a healthy accountant or being a healthy leader at work, let's first ask ourselves, what does it mean to just be a healthy human being and start from that place? You know, instead of always measuring our days by how many hours we're putting into our work, maybe we should think about what's my self care first. And so that idea of managing stress and managing anxiety, that that's a big one. just a few others. I can mention Mitch. you know, one of the big ones is how do I uncover and live into my own authentic strengths, you know, and work into those strengths. So how can I think about the job that I do and make sure that I'm maximizing my opportunities to be my best version of who I am? You know, so asking yourself questions like, what do I do really well? Now what do I enjoy doing? sometimes it may feel fleeting, but we really encourage accountants to really spend time and reflecting about their days and about more what brings them alive. You know, if you had a day and you had a rough day and, and you had another day that went really well, what was the difference in those days? What were you doing? How are you feeling? What skills were you using? You know, in those days where things were going better, where maybe you knew you were having a positive impact on others, you were a contribution to something bigger than yourself. You know? And so when you're able to do that, and then more importantly when you're able to reflect on that, then you become intentional about uncovering what your true strengths, your true talents, your true value is that you bring there. There's a book by an author named gay Hendricks and it's called the big leap. And he uses the term zone of genius. You know, what are the things that you, when you're doing them, you know you're succeeding, you know you're adding value, you know, you don't have to worry about time as much because you know you're doing the right thing. And he calls those years the area of your zone of genius. There are other areas he talks about like your zone of incompetence, the things you shouldn't be doing that you're probably doing or even your zone of competence, things you do okay but others could be doing. And so the idea of Hey, how can I be intentional about reflecting in a way that helps me to uncover my zone of genius? And really in a lot of ways Mitch, that's where we can have our biggest contribution. Maybe where we can make our most money in our life as well is where we're truly adding value. So that's another big challenge that we work with accountants on, which is what is your, your true zone of genius and how do you uncover it and then how do you go and live that more.  Mitch: (11:20)I think this is a great conversation and I enjoy your perspective on this. So I'm curious, what are some of the other frequently asked questions that you typically receive? Maybe it's from your clients, you know, on the job or maybe your colleagues that are kind of working in the leadership coaching role is just like you. What kind of questions do you get? And then how do you help them come to their own answers? It sounds like a lot of what you do is by posing additional questions.  Brian: (11:46)Yeah. Wow. You just described coaching really well. It's not about the coach coming to the answer. It's asking someone questions, powerful, tough questions to help them to come to their own answers, to uncover what matters to them and then go show up in a way, you know that supports what that is. so a couple other frequently asked questions. We get a lot, you know, how can I empower my teams or the people that report to me better? You know, that there's a lot of people that struggle with, how can I help my staff to own more of their own responsibilities? How can I work with my staff and empower my staff in a way so they're doing really well so I can do more of the things that I want to do, you know, so I don't have to like always be reaching out and helping them, solving their problems. So that's a big one, which is people that are sometimes get a little tired of having to be that, that chief problem solver. You know we here in the accounting industry a lot. I have to go fight fires, right? I have to go fight fires, put out fires for other people. And that can be draining. That can be tiring. So yeah, a very frequently asked question, which is how can I better empower my team and do it in a way that allows me to do the things I want to do maybe to live in more of my zone of genius. you know, and, and one of the big answers to that is instead of solving people's problem, instead of putting out the fires, how can you coach them in a way where you are helping them to increase their capacity to solve their own problems? So instead of giving them answers, instead of being that, that awesome solution provider, which is tough because a lot of accountants value themselves on being the answer right? And we're asking them instead of being the answer, can you actually be the questioner? Can you actually be a better listener? Be a better person that asks more powerful questions in a way that you're having them come up with their answers so that guess what? Maybe next time they can do it without you. And that can be challenging because sometimes in a weird way, accountants get value by being the firefighter, even though they complain about it, but they, they, they have other people relying on them and needing them and they get the value of being needed when in a lot of ways, when you want to become a much better leader, when you want to empower others, you need to be the person that helps them to solve their own problems. So we really feel that in today's ever changing world to be that solution to everybody, that's going to be too tiring. What you need to do is you need to coach, you know, always be coaching people in a way where they're thinking they're coming up with sometimes in their own questions. And so that question of how do I empower my people? Sometimes it's about changing your mindset, changing your mindset from being the expert and having all the answers to maybe being a little bit of a beginner and instead asking questions of others, helping them to figure out how they can solve their problems instead of you having to do that solution provider.  Mitch: (14:53)Now in our changing world of accounting with data and technology, a lot of the things that are taking some of the roles and responsibilities away from accountants, we emphasize that the true value of the account is their ability to had foresight to the organization. Right? Be able to contribute to these strategic conversations at influence like you just said. So in your opinion, what kind of leadership skills do you see being most valuable to those accountants you work with who have these long successful, sustainable careers? What is it that they possess and maybe what can our listeners work on to ensure that the future of their job is protected?  Brian: (15:33)Right. So, as you mentioned, you know, our industry is changing very rapidly and it's that that acceleration, that pace of change is going to probably just speed up more and more. And yeah. So yeah, that question of what are the leadership skills that I needed to be able to do well or thrive in that maybe weren't as important years ago that are now that are going to help me to thrive over the long term, even in a changing environment, it's changing so quickly. And one of the things that we found to be really important, and this can be a little bit of a challenge for most accounts, is instead of always being comfortable with having instant answers, you know, when we're talking about strategy or we're talking about where we want to go or a vision or where our group or our firm or entity wants to go, you know, it's so easy to want to have the answers and have them right away. And for accountants, a lot of times we're valued based on having the answers. But in today's ever changing world where we don't have the answers right away, we feel like one of the most important skills we need to have is being comfortable in the uncomfortable. And by that I mean actually gaining more comfort in not knowing the answers and instead of forcing answers right away because that's what we're comfortable with. We've got to come up with a strategy for our company instead of thinking, Oh, here's the answers right away, here's where we need to go. Maybe we need to sit in more of the questions. Maybe we need to be able to sit in not knowing and to be able to collaborate together in a way where we can say, Hey, you know what? We don't know these answers. Let's brainstorm together. Let's ask more questions instead of instantly trying to solve things in a way that can create new questions in a way that can create new answers and in a way that can create something that's innovative. You know, innovation is about solving old and new problems in new and different ways. And it what it requires is new thinking. And I think new thinking always requires, not new answers, but first new questions. And so a lot of times in our industry we're valued based on the answers we give. I think we need to really challenge ourselves as leaders. We need to value more of the questions that we ask.  Announcer: (18:00)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

FULL EPISODE TRANSCRIPTAdam: (00:05)Welcome back to episode 33 of Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson. And today we are going to hear from Jordan Savage, a successful CFO who quickly climbed the traditional corporate ladder to get where he is today. And his conversation with Mitch, he explains the risks he took and the opportunities he recognized to overcome some challenges and obtain the skills needed to progress in our accounting industry. Let's keep listening to hear Jordan talk about today CFO.  Mitch: (00:41)So it kind of looks like you followed a pretty linear career path as far as the different roles and responsibilities you've had. Can you talk to us a little bit about the different roles and kind of how each time things have changed as far as your responsibilities and the value that you offered to the position?  Jordan: (00:58)Sure. So when I first started my career, I started kind of with an entry level position as a project accountant. And what I learned early on is you know, you just have to do the best you can in the role that you're in. And once you prove yourself and you do a good job, you have good internal and external opportunities for growth. And in my case I've had a lot of good internal growth and so I went from a project accountant to a senior financial analyst with one company. And what you find as far as responsibilities, how they change is you really have to you understand the lower levels and so as you grow your personal responsibilities will increase every time you move up the ladder. And so you become responsible not only for your work but the work of the entire team and that's the biggest change as you work your way up up the ladder.  Mitch: (01:57)How about just the industry as a whole? I mean, I know you talked about how your roles change, but what have you seen as far as accounting and what do you feel has really affected those changes the most?  Jordan: (02:09)I think the biggest change within the accounting industry is long gone are the days where an accountant comes in, books a transaction and just keeps up with the daily record keeping. now the role of the accountant is much more value driven. You know, there, there's not a lot of value with day to day record keeping because most of our ERP systems are starting to catch up and allow us to book transactions that are routine or simple, you know, automatically. And so the role of the accountant has changed significantly. I think you have to possess more skills that relate to technology, you know, how to interpret and work with data. I think the IMA has done a fantastic job of kind of highlighting these changes with their you got to earn it campaign. I think we've all seen the commercials where, you know, there's the robot that's walking through the office and I think that's starting to occur. It hasn't hit every industry yet, but that, that change will certainly come. And so the value that we have to provide as accountants is just different in today's day and age.  Mitch: (03:17)In what position did you personally realize these changes? When did you see the technology and the automation really start to take some of your responsibilities away?  Jordan: (03:28)I think when I was a senior financial analyst, you know, when, when we first started, our systems weren't very robust. And so we had to do a lot of data manipulation before we could get to what we really wanted to study or, or look at. And over time as our systems became more robust and, and as they were able to handle more routine transactions and so forth, we were able to get better data out. And so we were able to spend more of our time doing the analysis and so forth. And so I think, you know, any of those entry level or you know, kind of second level above entry level positions will start to feel that transition the most.  Mitch: (04:12)Kind of going along this ladder that we're climbing here, you start to realize these different transitions in the role. I'm assuming that you've probably come across some new challenges also. Right? So can you talk a little bit about some of the challenges you have faced in some of these higher positions?  Jordan: (04:28)Sure. Well, and I think I'd first say, you know, in my opinion, the technical accounting skills, you know, those come with time and experience. And so from a challenge perspective you know, I kind of list it into three different areas. For me personally you know, with my role as a CFO now the first would be sourcing capital for our organization. The second would be managing the operations. And then the third is people management. And so in the, in the real estate and construction industry, good access to capital is absolutely necessary to achieve growth. We work a lot with our banking relationships to increase the amount of capital that they're willing to deploy with our group. And it's a constant challenge for us because we've got a tremendous amount of good projects but limited and constrained resources. So for us, that's a huge challenge. How do we increase the amount of capital that our banking partners are willing to spend with us? second, you know, for us it's, you know, our operations, which is, you know, processes, procedures, allowing us to scale. We've got three main operations at the challenger group. We do single family homes kind of traditional home building. And then we do commercial development, which would be mostly apartment complexes. And then we've just started modular manufacturing facility and of these companies, most of them are less than two years old. We've, we've got a lot of startups that we're doing. And what's interesting about, you know, our environment and our challenges you know, some people work on one startup and it's hectic and crazy. And in our case we're working at about or working on about seven of them all at the same time in various stages. So finding ways to streamline the processes and procedures and to make sure that the lessons we learn in one company are applied to our other startups I mean is very important for us. And it really does present a lot of unique challenges as we try to grow. And then the third, as you grow in your career you know, people management becomes incredibly vital. We talked a lot about servant leadership at the IMA and, and that's important. And I think in most cases the most important asset that a company has is not their intellectual property or the way they do certain things or the product itself. It's absolutely the people that they employ. So one of the missions of the challenge of group is making life better. And that goes for our customers, trade partners and employees. And I love that if we're actually servant leaders, we can have a positive impact, not only on our businesses that we operate, but also the lives of the people that would come in contact with. And I think that's one of the biggest challenges we face is how do we manage people, you know, customers, trade partners coworkers, you know, the list goes on and on. And I found that that people management to be the most rewarding and difficult endeavors that I face. there's a great book called the outward mindset that I'd recommend the listeners to read. one of the things I took from that book was that people aren't just simply objects to help us achieve what we're trying to achieve. Each individual has needs, objectives and challenges that they face, whether, you know, within their role or on a personal level and so forth. And the more we can look at them not as objects, but as people that have those, you know, needs, desires and challenges of their own, the more successful we're going to be collectively. And I think it's a really a great book to read and really a good opportunity for us to evaluate how we look and see and treat others. Because I think one of the things I've found, you know, with people management is people can really tell if you're being sincere or if you're being genuine. And they can tell if you're just trying to use them as an object. And usually the results are significantly better when you're being genuine and sincere because they can, you know, they can feel that and, and you can have a positive impact as opposed to just saying, Hey, you know, I don't care about you. I just want to get X, Y, or Z done. And I think that is a big challenge.  Mitch: (09:05)So in your role as CFO with these different challenges, you know, listening to you kind of describe each of these buckets I would almost assume that your priority is in the reverse order, right? I would think that you kind of focus on the people and then the operations and then that sourcing aspect of it. So how do you kind of prioritize, you know, what's in front of you and what you have on your plate in order to ensure that you are the one who's driving the company towards this sustainable growth?  Jordan: (09:34)That's a great question. You know I think you're exactly right. You know, my focus is on people. I've got a semi large team. I've got six people who work in the accounting department. And then we've got our partners, we're now in four different states. And so, you know, managing a startup remotely has been challenging and so you really do have to lean on people. And so it's a lot about, you know, managing the relationships and making sure that everybody's, you know, pushing in the right direction and doing what they can to support the operations. you know, we do a lot of coaching and mentoring here which I think is incredibly important. I think all listeners should look in and see who's impacted their career so far and try to connect with them and make it a long term relationship where they can bounce questions and ideas off of. As far as the sourcing capital and cash-flow management, I really just try to stay ahead of stay ahead of the operations. You know, that that basically means I'm just aware of what's happening and forecasting our needs in the future to make sure that I don't have any surprises of, Hey, we need $1 million tomorrow and you know, those types of items. And I think, you know, in any company creating good processes and procedures, that's going to be a very important aspect of our role as accountants is making sure that we're operating efficiently. But it's certainly much more so relevant within the startups where, you know, processes and procedures haven't been created because, you know, we haven't crossed those bridges yet. So like I mentioned earlier, the, the biggest thing that we try to do is to make sure that we, anything that we learn when we stub our toes in one company, we, you know, learn from that and we pivot and make sure that other areas are unaffected and that we can kind of get ahead of it. So we've been operating from a home building side with our out-of-state builders under an owner operator model which has been a really interesting experiment to see how that works and so forth. But one of the things that we've learned is we've done the model I think four different times now in four different States. And you know, the, the last person that we onboarded as an owner operator had a very different and much more pleasant experience with us than the first person that we started with because we just learned so many lessons along the way. And so I think just being able to understand and, and pivot and be flexible and adaptable to your environment is going to be critical and key to your success.  Mitch: (12:21)Well, I think that kind of goes right along with, you know, where we're going with this conversation, right? Kind of being able to pivot and adapt. The finance function as a whole really is going from this, you know, service function or service delivery to this value creation. And I know you kind of talked about that is creating value with the people and you know, making these experiments work for new clients. I'm really curious on what you have done, you know, what do you attribute your ability to learn and grow as you go through this process? But what have you done to kind of develop the skills needed to really offer that value to your organization?  Jordan: (12:58)I think it's been a combination of things but I've worked really hard to progress quickly and learn quickly. And so for me, that means I've taken risks along the way in my career. I remember the first risk I ever took was back when I was in school. I had offers with all of the big four accounting firms and that's the more traditional route for most accountants coming out of university. And I decided, you know, that that really wasn't for me. And so I rejected that offer and ended up working for a company called red hat in North Carolina. And it was one of the best things that ever happened to me because I, you know, instead of auditing and you know, looking at kind of companies from an external lens, I was thrust right immediately into kind of an internal environment and industry. And I was lucky, and very fortunate, I had a great boss at the time who mentored me, who I worked very closely with that I learned a lot. And one of the most valuable things that he gave me was he provided really honest and direct feedback through the beginning of my career. And you know, thinking back on that, I, I think it's important to note that you shouldn't be afraid to ask for feedback and then you also shouldn't be afraid, you know, as you grow in your career to give honest feedback because that's what people want and that's how people learn and, and are able to progress quickly. And so I think, you know, that that first risk was really important for me because I learned a lot of lessons that I wouldn't have learned in another environment. And I remember when I was getting ready to leave red hat and look at a different opportunity, I had an opportunity to become a controller and a people manager for the first time. And sometimes it's easier to find those external opportunities versus the internal cause. Internal opportunities move a little bit slower than external, but you have to be willing to take that risk. And I remember I was called into an office of a senior vice president that I didn't really work with, but manage the entire department of probably 50 to 60 people. And after failing to convince me to stay with red hat, I'll never forget it. This senior vice president looked at me right in the eye and said, they're going to eat you alive. And I just thought it was really interesting that you know, the new opportunity here, I was being told I was valued. I, you know, I should stay with the company. But then in the, in the same breath, I was told if I chose something that I felt would be good for me and taking, you know, taking a risk on myself that I'd fail. And so I took that as motivation and took that risk. And I've learned over time that the only way that we can learn and grow is if you're pushing yourself outside of your comfort zones. And so for me, taking that other opportunity was kind of a sink or swim moment for me. And that's kind of one of the ways that I've been able to kind of stay ahead of the learning curve and develop the skills I need to provide that value. I think as far as the skills specifically, there's many ways to do that as well. One of the things I've tried to do is learn from others. So this Boston mentor from my first position in the accounting world, he was fantastic. He does a lot of things right that I really respected and appreciated. And there were some things that I didn't, you know, agree with necessarily. And so I tried to take always the good from people that I come in contact with and kind of say, okay, if there is a fault or, or something that I don't like to make sure that I'm not, you know, repeating those type of behaviors that I don't appreciate. so I think we can learn from others by experiencing the, or by learning from their experiences for good or bad. I'm also a very avid reader. I remember early in my career I'd read a lot of managerial books about you know, management and so forth, long before I ever became a manager. for me that was very important. it helped kind of set the stage of what type of manager I wanted to be. when situations arose in the environments that I was in, I'd think of, okay, well if I was, you know, the manager, what would I do? How would I respond to these different challenges that I am seeing around me? And so having, you know, good books that are written being able to read them and kind of study them and think about, well, how would you manage people? How would you do things differently and so forth. Asking yourself that type of question that can help you tremendously. So I'm a very avid reader and I think that's important to make sure that you're reading. One of the things I try to do is read at least one, one book a quarter. Sometimes I can do a little bit better than that, but one book specifically about business once a quarter that, you know, can help shape the way you think and the way that you operate. And then lastly, I think, you know, part of our careers, it's, it's largely trial and error. I think we, we do a lot of things and we experiment and the things that work well we continue to do. And the things that don't work well, we have to be adaptable. Like you were saying earlier, we've gotta be able to pivot and move quickly instead of digging in our heels and saying, no, this is the way I have to do it or want to do it. So all of those things, you know, everybody has their own methods, but those are kind of the three things that have worked for me. But the most important thing I think is to put effort into trying to develop, develop yourself as a professional and then also as a person. I think it goes without saying that who we are as people matters probably more than who we are as a business person. So I think if you focus and put effort into who you are and what you stand for and having honesty and integrity part of kind of your core values, you'll do very well.  Mitch: (19:16)Well I think you've done a great job, you know, first talking about yourself and your progression. So I truly appreciate you sharing some of these stories. I think you also did a great job talking about the role of a CFO and kind of what you do on a daily basis. So you've really covered a lot of this already. I'm just curious if you have any closing remarks for the listeners, any practical tips or suggestions that you kind of want to end with here?  Jordan: (19:40)Absolutely. So the most practical tip I have is three fold. I've already, you know, kind of previewed it, but you know, first never stopped learning and investing in your, in yourself, read books, study up on your industry, become an expert and get professional certificates or licenses. I'm a certified management accountant, certified public accountant and certified fraud examiner, which I believe all have positively impacted my career. as I've mentioned before, I read a lot of books, both, both business related and otherwise spend more time investing in yourself and setting goals for your career. nobody's going to manage your career better than you can. So set goals and then be willing to invest in yourself because most people aren't willing to do that. And so if you're willing to do it, you'll go far. Second. I think one thing that we don't talk about, you know, as we think about taking new responsibilities or transitioning careers or transitioning jobs or companies, et cetera, I think the biggest thing that we should think about is instead of taking a new role because of what the role has presented, I think you, you should really think about the next opportunity as, okay, if I take this role, what will the, what will the internal growth opportunities be and what will the external opportunities be? And so for every position that I've personally taken in my career, I've always thought about not what the role was, but what would the next role look like if I took this job? And what that's allowed me to do is progress very quickly in my career because every move that I've made has prepared me for the next step with the ultimate goal of becoming a CFO, which is what I set out from the very beginning to do. And so I think it's very important to, to make sure that you always think about that because some roles have great internal opportunities but very poor external growth opportunities. And that can be scary because you might end up in a situation where the internal growth doesn't materialize and then you're kind of stuck. Conversely, if you have good external but no internal growth, you might get stuck in unless you want to leave or move or relocate or get a new job, et cetera. So I think finding roles that have both internal and external strong growth opportunities will be important to make sure that you don't get into a situation where you take a job and then realize, Oh no, I've, I've, I'm kind of in a dead end and I'm going to have to take a step backwards in my career in order to press you. You want to make sure that you can avoid that if possible. And then third and lastly is just be willing to take a risk. I would say relocate if necessary. Sometimes that's what's going to be necessary to take and take that next promotion. Be willing to do that most. Again, most people aren't willing to do that. So if you are willing, you, you'll be able to progress quickly in your career and then if you have a particular location that you want to go back to, you can always continue to look in the future for positions to come home to, you know, Colorado Springs for my wife and I was home for both of us. Both of our parents are still here and we always had a goal to come back to Colorado Springs, but it's very hard to come to this market, you know, with a entry level position because Colorado Springs can be an expensive place to live. So North Carolina was a great proving ground for me to grow in my career. And then when I was ready and the opportunity presented itself, I could come home. So just be willing to take a risk and learn from your failures, you know, strive to constantly improve and you'll have a fantastic career.  Announcer: (23:35)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Robert: https://www.linkedin.com/in/rwleonard/The Investors Network Podcast: www.theinvestorspodcast.com IMA Life-Robert Leonard: https://sfmagazine.com/post-entry/july-2019-ima-life-adding-impact/FULL EPISODE TRANSCRIPT Mitch: (00:00)This is Count Me In, IMA's podcast about all things affecting the accounting and finance world. I am Mitch Roshong and I'd like to welcome you back for episode 32 with corporate finance manager Robert Leonard. In this episode, Robert talks to us about climbing the ladder in today's industry and why accounting skills are so valuable. So now let's head over to his conversation with Adam  Adam: (00:26)So Robert, what advice do you have for students or recent graduates hoping to break into accounting and finance fields?  Robert: (00:40)I think one of the biggest things is don't be afraid to take a position that isn't perfect or doesn't pay the most. I think you need to think longterm and you know, ideally look for opportunities where you'll have a mentor.  Adam: (00:58)So how do they find that mentor?  Robert: (01:01)I think it's through the interview process. Usually when you go to interview, you'll have three or four different people that you'll be meeting with in general and see if any of those people seem like they might be be great mentors for you. And I recently made a job change actually, but within the last six months or so and I was in a position where I was very, very happy. I didn't want to leave the organization that I was at, but the new company, the the gentleman that was going to be hiring me had those characteristics that I was looking for in a mentor. Yeah, I thought he was going to be a great mentor and that was one of the big things that really swayed me there and, and I think you should interview even if you're not a hundred percent certain on the position, you can learn a lot in the interview and that can really help you determine if there's opportunities that might not be present in the job description. I've interviewed for positions before in the past that weren't necessarily right up my alley, but it ended up being a great opportunity for me that I really enjoyed. And I think other ways you can break into the accounting and finance field, they're learning outside the classroom. I think that's so big these days. Well, a lot of people are still going to college and there is great value in college. I think learning outside the classroom is critical and specifically skills outside of like a normal college. So Excel or just how to professionally write emails and professional communications that can be taught in school. When I, back when I was in college, probably the best course I took throughout my entire college career was my professional communications course and that's helped me in various ways that I never would've expected in my career. And I think it's those skills that are more tailored for outside the classroom that can really help [inaudible] break into an accounting and finance field. And just one more thing that I think you can do these days is published content on LinkedIn and it should be tailored to the type of job that you want to get. So if you want to get in accounting and finance, post content about accounting and finance on LinkedIn and that should be able to help you get in front of either recruiters or just prove your knowledge too, potential employers. So you've got a mentor, you've got those first few jobs, you've gone on interviews and then you know, you start your first job. You know, what does it take to kind of climb that corporate ladder in today's accounting industry? I think what's so interesting about climbing the corporate ladder today is that it doesn't just take time anymore. You know, decades ago you could just kind of do the same thing and day in and day out and eventually you would follow the path and you gradually climb the corporate ladder. And I don't really think that's the case anymore. I think what you need to do to climb the corporate ladder is you need to work really hard and do things above and beyond so that you're the first person that a company thinks of when they have an opening. I think there's a lot of turnover these days in companies and so it's almost eminent that there's going to be an opening and when that opening does happen, you want to be the first person that your boss or their boss thinks of when that opening come so that they choose you to go into that new position. And I think that just comes from going above and beyond taking on additional projects that maybe no fit your job description perfectly, but you know the company needs pure hard work. Just be the first one in the office and the last one to leave and if you don't know how to do something, find a way to do it. If you take on additional projects area, there's additional projects that you want to take on and you might not know how to do it. You can, there's so many free resources out there these days to learn what you may need to know to get that project completed. So I just say find a way to do it. And I think the other, I live my career, bye. Three things and it's really helped me advance my career. And that's humility, a dedication to lifelong learning and hard work. Humility allows you to realize that you don't know everything and that you still have a lot to learn. But by being dedicated to learning, you can learn the things that you don't know and then apply it through hard work. And I think, I honestly think what those three things, anything is possible. And I'm still relatively early on in my career myself, but I've scaled my career pretty quickly by those three things. And I think those are really the three critical things that you need to climb the corporate ladder in today's accounting industry. And another aspect of it that I think is relatively uncommon to be talked about, especially when we're talking about work, we're talking about climbing the corporate ladder, right? So what does, what does personal finance have to do climbing the corporate ladder in an accounting industry? Well, I think it has a big role and I think what we'll see play out over the next few years and I think it'll be an increasingly important role. And the reason I say that is because if you can get your personal finances in order, you're able to take risks with your career that will play out over the long term, better for you but might not be as helpful in the short term. Right? So if you are in a financial position with your personal finances where you're a little bit tight on money and okay, you might need to take a the next job that you want to take and you might have to go to the job that has the highest salary even though it might be short term, highest salary and not a lot of opportunities for growth. Sure you could switch companies and you know, kind of do the job hopping thing. But in general that's not a great strategy. Whereas if you have your personal finances in order and you're coming from a really strong background of, of your finances, you can take us a little bit of a short term hit maybe that that next job isn't as big of an increase in pay as you want, but you're getting a great mentor, you have huge opportunities for growth. And over the next three to five years you could double your salary or you know even more, you know, I think, but if you don't come from a position of financial strength where you have that ability to take that job, that's going to be better for you over the long term. You know, you're really doing yourself a disservice. And I think this is an aspect of climbing the corporate ladder that is greatly overlooked. And for me, I've had two similar positions like this recently when I came out of college, I worked at a consulting firm for a few years and then I wanted to make a switch and it wasn't the best for me financially and it wasn't a position that I was really super interested in. And this goes back to what I was talking about before about even interviewing on positions that year, maybe not super interested in, you know, to be completely candid, I was getting ready that morning for the interview and I almost didn't go, I almost called and canceled the interview because I wasn't interested. But turns out, I went to the interview, the hiring manager was actually sick that day and so I ended up interviewing with the global controller of a large fortune 500 company and we hit it off really, really well and he really liked me and I got a text from him the next morning and it was super abnormal because you know, you don't usually get a text from somebody that you just interviewed with the day before. And so I got a text from him and he asked me to call him and so I did. And ultimately they ended up offering me a position, probably a step or two higher than what I was interviewing for. I'd say two steps higher than what I was interviewing for. And they were kind of reorganizing their function. They moved around three or four people to get me into that position. And that was an interview that I didn't even want to go on because I wasn't that interested in the job and just didn't seem like a good fit for me. And so that goes back to that even interview on positions that you're not 100% certain about. You never know what could come of it. And then recently, like I said, in the last six months I made up, I moved from my, my career and again, I didn't think it was the best thing necessarily in the short term, but in the long term I saw a huge growth and you know, so far it's been great. I got hired in one position and my boss was actually, I really left the organization about a month after and I was given a large promotion and now, you know, running with that and like my career is rapidly growing. So you just never know. And I want to say that if you approach climbing your corporate ladder from a position of financial strength, you could take a lot of opportunities that you might not be able to take if you need to, if you're really worried about your paycheck. So I would really highly recommend really trying to get your personal finances in order so that you can take those chances in your career that benefit you for the long term.  Adam: (09:48)Okay. So a trend we kind of see in among younger professionals is they they hop from job to job to job so they can climb that corporate ladder. You know, what's your take on that strategy for when you're, when you're trying to build your career?  Robert: (10:02)Yeah. You know, I think that's a really, really great question and I don't want to recommend job hopping because I don't necessarily think that's the best way. I personally would rather stay at a company for the entirety of my career if that was, if that was the case. But you do see that in general hopping from job to job has been in an efficient way to climb the corporate ladder because, and I don't have a great answer as to why this is, but it seems like a perspective employer is willing to pay you your market value or is willing to, they might have an opening that would be a step up for you. Whereas the organization that you're at, they either don't recognize your market value or they just don't have a position for you. And that's just kind of a symptom of the organization. So I don't necessarily want to recommend job hopping, but if you really want to rapidly grow your career, it is sometimes something that you need to consider. And again, if you need to do it from a financial perspective, sometimes that's what you need to do in order to get your market value. And so I would just be cautious of it. Think, think through all of it. You know, think of your 401k vesting the benefits, you know, as you get a little older in your career, you know, the benefits might not be as so important in the beginning, but as you, as you get into your career more, you want to look less at the monetary salary and look more at the benefits. So when you're job hopping, just make sure you take that all into consideration and really make sure that when you do make that change, that it is a net gain for you. And so that you're not necessarily gaining in some places but having a bigger loss than others. And so, you know, sometimes it is something that you need to do two, climb the corporate ladder. It's just kinda how it is these days. But, but I just definitely make sure you look into where you're going and the grass is not always greener on the other side.  Adam: (12:03)So we've talked about, you know, the accounting industry, you know, how about when you go to different industries, you know, how does the finance function change based on the industry you're working in? Robert: (12:15)I think what's interesting about different industries is, and I think that's a great question. I've actually worked across quite a few different industries. I've worked in financial services, consulting, healthcare, I've done a little bit of government work, manufacturing and I currently work in construction. And so far construction has been by far the most different industry out of them all. But what I think is great about finance in accounting is that it doesn't really change a cost across industries. It does on a micro basis. There are some specifics that change as you go across industries but fundamentally doesn't change. Accounting is still accounting and finance is still fine if you do the things that I mentioned previously, specifically those three key points that I approach my career by humility, a dedication to lifelong learning and hard work. You can learn whatever is needed for industry specific knowledge. When I joined the construction industry, I didn't know anything about it and it is very different than the industries I've worked in the past and there is a lot to learn. But by applying those three things, I've been able to learn what I needed to know about the construction industry and I'm still learning of course every day, but it allows you to really understand what you need to to get by at first until you can really understand everything you need and the industry won't matter as much if you're doing all of those things I mentioned because you can learn those specifics. You can learn what this specific items are that make an industry different from the other relatively easily. But if you don't have those soft skills that we've talked about so far, those are the really hard things to develop in yourself. So if you have those soft skills, then you can pretty much apply those to any industry and be successful in it.  Adam: (14:06)So why do accounting skills and abilities translate so well to other facets of your life?  Robert: (14:13)There's a few different reasons and the a few of them are, I think accounting is generally really organized. So I think the organization of accounting work generally applies well to other facets of life. Because I mean generally being organized in anything you do is, is beneficial in same with accuracy in accounting, everything has to tie out. So being organized and accurate, again, just applying accuracy and organization throughout your whole life, it can be be very beneficial. And the other two items are problem solving and deadlines. And so problem solving and accounting especially, you're doing reconciliations, that's basically a big puzzle that you're working on and you're always problem solving and trying to work your way through those reconciliations. Right? And so by learning you have to learn different ways to find out what needs to be done to get those accounts to reconcile. And you're basically just doing a lot of problem solving and learning to problem solve through that type of exercise or those tasks can be applied to a ton of different facets of life that you can just apply those problem solving skills that you have recently developed throughout your accounting profession. And then deadlines and the deadlines might not be super strict depending on your company or your industry throughout the month. But when you're in your close process, generally you have some pretty strict deadlines that you have to follow. And so by following and learning how to follow those deadlines during a close or tight closed process that helps you be on time and just present at the need of time for all different variations of life. So anything that you're doing by knowing you need to have things done at a certain time, it helps with time management skills and it just makes sure that everything is done as needed.  Adam: (16:07)Yeah, it's great cause you know, if you apply what you're learning in your job or your learning outside of your job too, your professional, you'll be able to, you know, just grow as a person and then you'll be applied through each no matter what industry you're in, no matter where you're going, you can just keep growing us. Keep growing in what you're doing.  Robert: (16:30)Yeah, absolutely. And I mean there's so many other ways that accounting skills and abilities translate well to other facets of life. But I think those are the, the four main ways that I've seen in my life.  Adam: (16:43)That's great. You know, so we've covered a lot of different things today. We've talked about, new skills that you can gather, you know, getting mentors, climbing the corporate ladder. But, you know, let's take a look at the future. What do you, what predictions can you make for the future of accounting and finance? What, what do you see happening?  Robert: (17:03)Yeah. You know, future, future predictions and things like that are always difficult. You never know what's coming. But I think the biggest thing is that people who don't do the things that I've talked about throughout the show and don't have those soft skills, they're going to be replaced by software, other software programs, AI, machine learnings, et cetera. Right? If it's just processing invoices, just doing some reconciliations or some relatively simple just kind of tasks that are repeated frequently, those things are going to be replaced by software or AI. You're not necessarily going to need degrees any more, I don't think. I think you're going to need to know the basics of accounting and finance. But again, I think the EQ and soft skills are going to be so much more important. AI and software, they can do a lot of repetitive tasks, admin type tasks, but they're not going to be able to do the analysis, add that human aspect that you can. And so I think focusing on that is going to be really important. And I think, you know, for me specifically, I was recently hiring for a treasury analyst at my current, in my current role, and I was looking more for software skills. You know, I was putting a very heavy emphasis on Excel and another ERP system that we're currently implementing. And I was looking for hardworking and time management more than anything. You know, of course I want some treasury skills and some, a little bit of treasury experience but that was almost a back-burner for me. You know, I feel like I can teach relatively easy. I feel like I can teach the accounting and finance and treasury skills needed to do the work. Whereas if you don't understand how to use Excel or if you're just not hardworking or you don't have time, good time management, those things are very difficult or very time consuming to teach and I don't think that that's going to be successful for you to grow your career. So it's really, I think if you don't, to really sum it all up, I think the biggest things that I predict for the future is that you're not necessarily going to need the advanced degrees anymore that you do today. And I think that the rather remedial tasks are going to be replaced by software and AI.  Announcer: (19:19)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you liked what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Monisha: https://www.linkedin.com/in/monishadequadros/Sparkbox Group: www.sparkboxgrp.com FULL EPISODE TRANSCRIPTAdam: (00:05)Hey everyone. Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. Thanks for joining us today. I'm Adam Larson and this is episode 31 of count me in for today's episode. We're going to hear Mitchell's conversation with Monisha de Quadros, a former CFO in both the public and nonprofit sector and now founder of her own outsource CFO firm. Let's listen to Mona. Just take on the role of today's CFO. Mitch: (00:44)What are the main differences in the finance function between public organizations and the nonprofit sector?  Monisha: (00:44)So yeah, that's a really good question. there are very few nonprofits today that have a proper finance function. Many times what happens in a nonprofit organization is that the accounting team subsidizes and doubles up as a finance team. And unfortunately the skills required for an optimal finance function is actually quite different than the skills needed for accounting. So nonprofits can certainly train their teams for financial modeling skills, critical thinking and analysis. But it's challenging because the two functions actually a wired differently. And then the hiring process is also a bit of a catch 22 because it's difficult to recruit finance talent in the nonprofit sector and yet it is critical to the success of these organizations. So having the right financial support and the nonprofits helps drive profitability, grow revenue, stretch and maximize each dollar expense, deliver valuable insights, and then also create long term sustainable strategies.  Mitch: (01:40)Now with a perspective, from, you know, both sides of that conversation, what is the greatest challenge you faced as a CFO with today's changing finance function? Particularly with, technology and digital age?  Monisha: (01:55)Yeah. You know I think it's two fold. Like one of the biggest challenges the CFO faces today is transforming the finance function from a cost center to a value creation center. The second challenge subsequently is the evolution of the CFO role itself. So both the finance team and the CFO are gatekeepers of critical data required to support decisions and strategic plans as they chart their journey through the digital age, the success of one becomes more intrinsic in the success of the other. So let's talk about the value creation center first. So it's safe to say our environment is changing at a rapid rate and this is probably the slowest pace we will see in our lifetime. So the speed at which change is happening, it's forcing businesses to evolve and transform at quicker intervals in order to stay relevant and competitive. So factors such as disruption, innovation, technology, consumer behavior, and globalization are all contributing to this space of change. Without the right data and financial insights, businesses will have a tough time making intelligent business decisions compete in this environment. and as a result it becomes increasingly critical for the finance function to step up and equip the business with the right financial insights for better decisions. So we need to evolve into value centers. And what I mean by value centers as I'm preparing to choose thoughtful analysis, predictive analytics strategies, and most importantly actionable insights with respect to the CFO. What's really interesting is that the rule is actually sitting at the center of the digital transformation. So we're seeing a greater need for real time data enabled decision support to meet that need. The CFO is moving away from the traditional activities like transactions. And reports to a more strategic role. So they're driving business decisions and preparing the business for the future. CFOs are being asked to be leaders within this evolution, taking on advisory roles to the CEO leadership team and the board. And the speed at which digital transformation is happening is also producing a greater appetite for business risk. And in turn, the CFO will need to be more resilient and proactive in their strategies to innovate. We're also seeing trends where the CFO is taking on additional responsibilities like taking over the operations functions and the it and technology functions. And some would argue that the role is expanding and becoming increasingly more challenging. And I would, I would actually agree, but I would also say it's becoming more interesting. So the CFO has a wide perspective with visibility across all business functions. They can act as the bridge connecting and driving the business in a cohesive manner. And then they have this ability now at this point and the structure to influence leadership, to be change agents and impact long term growth within the business. And lastly, they're in this unique position to actually define their own path. In this digital age.  Mitch: (04:48)Now let's go back to step one for just a second. What are some ways the finance function can actually transition from this cost center to this new value center that you mentioned?  Monisha: (04:58)Yeah, so I think we're the hardest, but probably most needed task is to develop an agile analytical mindset within the department. So agile is the ability to learn fast, adapt quickly, and iterate. Often one of the ways CFOs can adopt an agile mindset within their teams is to foster more creativity and curiosity. It's about creating an environment where it's okay to innovate, embrace risk, and sometimes even fail on the process. So just remember to have a feedback loop in place for lessons learned when you actually implement this process. Cause that's very, that's a critical step. Some of the practical approaches implemented today have been to create special projects with small teams or rotate job functions within the department. And of course offer continuous learning. Agile requires a different set of skills and talents that I think the CFO is going to have to either train or hire for. And these skills include digital competency, predictive analytics, agility, and even the human skills such as empathy and decision making capabilities. Another equally important step in creating this value center is to to emphasize collaboration across functional departments. You know, interestingly enough, recent studies have shown that there's a direct correlation between effective collaboration and the rate of revenue growth. So in order for businesses to make better decisions, there needs to be greater collaboration and the continuous flow of information back and forth between the functions. One can foster collaboration by developing a platform, a mutual trust. And by this I mean a space where both parties feel safe to share and constructively challenge each other with the common goal to increase customer value. Lastly, spend the time and resources to optimize current systems and improve integrations like the long term savings and efficiency and agility the business will see from doing these initiatives are well worth the effort and costs upfront. And I cannot stress that enough. Like the goal was optimization is to transfer data seamlessly between systems like the ERP system and the CRM and the finance system and enables finance function to pull clean and accurate information on a timely basis. In today's environment, finance team spent an inordinate amount of time pulling data from multiple systems and then they have to spend the time cleaning it and ensuring for data integrity, making it increasingly difficult for them to find the time to analyze and actually deliver insights. Now the upside is that there's a range of technology enhancements that can be utilized. So McKinsey study, from the global Institute show that 42% of all finance activities can be fully automated. 77% of which is general accounting. That's a really high percentage. So front and center in automation, it's artificial intelligence, AI. And then the next one is robotic process automation, which is RPA. All finance functions to be leveraging it in one way form or the other. RPA is really interesting because it automates simple repetitive tasks and frees up the staff time for analysis. Another really interesting tool that can be used is data visualization. Like Tableau for instance, they provide real time information to end users in an intuitive format, so that allows for accelerated decision support. The third and a handsome meant that I would suggest would be predictive or or advanced analytics and this allows the business to uncover hidden growth opportunities. Let's say for example like pricing optimization or identifying a customer behavior trend. So it is understandable that system design and optimization can be really expensive, so therefore I would encourage finance teams to start with simple automation off the current systems. Then move to larger projects involving data analysts or Davis size data scientists, and then lastly, implement AI, which is obviously the most expensive to data scientists. I have a really interesting function. They help aggregate enormous amounts of data from different sources and present that information in a really meaningful way. In this digital age that we're in. The benefit of system enhancements is enormous. It up-rise provides for more collaborative thought partnership across the functions and they're also strategically positions the organization for sustainable growth.  Mitch: (05:50)Let's take all this back to more traditional accounting for just a second. How can businesses leverage this transition to a value center, and really notice the impact on the financials and long term initiatives? How does all this ultimately lead to driving some kind of sustainable growth for the business?  Monisha: (09:14)Yeah, that's a good question. you know, driving like driving sustainable growth. I think it's a collective process. In today's environment. The CFO cannot be the only person in the finance team that is thinking strategic go long term. So everyone in the finance function should be thinking about the future. How can I make this better? Where can we add value? How does my decision impact the organization today? And what does it like in the long run? So the finance function, it has a responsibility to explain and guide the value creation process within the organization. And there are several areas that they can leverage to drive sustainable growth. So one of the areas of KPIs, when we move our focus beyond the traditional financial KPIs to operational and business metrics, we provide a clear roadmap for sustainable growth. I tend to like to call them actionable KPIs because they look, they're forward looking metrics that drive future strategies. And provide a holistic view of the company. So traditional KPIs are, are based on historical trends while actionable KPIs, provide business intelligence for future decisions. For instance, when a business focuses on customer satisfaction, like an NPS score, they have the ability to improve customer attention and or full rates and then which in turn increases revenue growth and profitability. So another way that organizations can leverage financial data for sustainable growth is to strengthen the forecasting process for both accuracy and operational intake and integration. So a good forecast provides businesses with early signals to maximize opportunities and minimize risk. Leading organizations today treat their forecasting proxy process as a standard operating procedure. It's incorporated as a month and month end close process. They use both qualitative and quantitative methodologies and they include forward looking updates from their business partners. I would also suggest creating a conservative and aggressive forecast to allow you to stretch your thinking and explore a larger set of opportunities. Another suggestion is to incorporate predictive analytics in the data inputs itself, which will also strengthen the forecast and improve long term growth. You know, since we're talking about the digital age in this podcast, it'd be remiss for me not to mention AI. So AI is becoming increasingly popular to use in forecasts because it provides organizational wide visibility. Artificial intelligence helps with accuracy, it pulls large data sets seamlessly and provides real time forecasting for quicker, more intelligent business decisions. The last and the most important building block for sustainable growth is a dynamic strategic plan. And I can't stress this enough, like long gone are the days of the traditional five year strategic plan performed once a year to compete and transform in today's changing environment strategic plans need to evolve adopting an agile approach to strategic planning will keep the business flexible and nimble and enable the leaders to quickly seize opportunities and potentially avoid pitfalls. So what does agile planning, right? Agile planning is a continual iterative process. It uncovers long term strategic initiatives that can be broken down into smaller, digestible, short term projects. So think of it as a relay race with four short, 100 meter sprints to make up the 400 meter base. Unlike the annual typical planning process, agile strategic plan, occur typically every quarter. And they also begin with smaller groups of stakeholders that are empowered to make important decisions whenever needed. The key to success in an agile process is to break down initiative into smaller achievable tasks that include a rapid review and approval process from leadership. And finally, fast track the implementation.If the short term project is not working out in that time period, the business has enough time to change directions to still met it's long term objectives. Mitch: (09:31)So to wrap things up here, how can one tie everything together and start to implement some of your suggested best practices? What are you doing in your career to help these professionals with these challenges and opportunities? Monisha: (09:31)Yeah, to tie everything together I think the first and foremost part is to build a dynamic finance team. One that is ready for change, agile, curious, analytical, and excited about creating value for the business. And then integrate strategic thinking throughout the fiance department because everyone has a role to play in this transformation process. Secondly, adopt technology to automate and integrate the way data flows throughout the organization. It'll make it easier and quicker to deliver financial insights for better business decisions. And last but not least, utilize KPIs, flexible forecast and agile strategic planning takes celebrate value creation, transformation, and sustainable growth. So over my career, engaging in small businesses and nonprofits, I found those inherent need for financial strategies, skills that delivered value creation and actionable insights in today's changing environment. So because of that need, I started a company called Sparkbox. At Sparkbox. We're an outsource CFO firm focused on creative finance solutions for social enterprises, both private and nonprofit. Because of that need. I started a company called Sparkbox as BarkBox. We're an outsource CFO firm focused on creative finance solutions for social enterprises, both private and nonprofit. We offer four thinking strategies that challenge the status quo and build upon your mission to promote scalability, profitability, and sustainable growth. What really makes us different is that we apply a holistic approach to our solutions, integrating all functional areas of the business. So our part time and fractional CFO services are designed to transform your business and help you keep and help keep you relevant in today's rapidly changing digital world.  Announcer: (15:26)This has been Count Me In, IMA's podcast you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Fatima: https://www.linkedin.com/in/fatima-mamod-ca-sa-cia-60837876/FULL EPISODE TRANSCRIPTAdam: (00:05)Hey everyone. Welcome back for episode 30 of Count Me In. I'm your host, Adam Larson and our featured expert guests for today's conversation is Fatima Mamod. Fatima is a chartered accountant, entrepreneur and a business coach from Johannesburg, South Africa who joined Mitch for a conversation on what she calls the business savvy accountant. Let's tune in now to learn more.  Mitch: (00:31)In your opinion, what skills are most necessary for an accountant to be successful in today's business environment?  Fatima: (00:38)Okay, so I think the most important thing, I mean we are accountants by profession is definitely the technical skills. I think that goes without saying. But on top of that is to have a very important elements I think. And the second one is business acumen. And when I say business acumen, you know, I really mean where you can tie in your technical skills with helping the business achieve what that moods to. So it's not just knowing or understanding how the business works, what's the dentist process? It's actually tying in your technical skills with what the business needs. And I'll use the data's process as an example. So we all know you need to do a data's check in the beginning. You need to ensure that they have a credit limit. You've done the credit fitting, etc. Now as the accountant, you know that what I've realized is simple things like this, sometimes within the company, people don't understand the importance of it until you're way down the line and you're not getting the money from your datas. So what I find is communicate, talk and let your sales people know why it's so important and how this impact and fix them. And that's a difference between understanding the business and business acumen which is really important. and then the third thing that too, we are never taught as accountants I would say, is communication skills. We understand numbers. We never thought how to present those numbers through a story that business leaders can actually understand. I mean, how many meetings have we been in where the accountant is just asked to then present the numbers as he or she is going through it. No one's actively engaging. They either busy with something else because we don't present our numbers in a way that tells a story of the business. And I find it really useful and what has helped me a lot and I get very great feedback, is when I present with telling a story and I do that by talking to my colleagues beforehand saying, hey, I see our sales that actually up this month. That's great. What was the reason behind the, it's how did it go? Was it customer A and tying that in. So when you're presenting the people you've spoken to actually feel like they part of your presentation, they feel like you're presenting a part of this story. And that's really key.  Mitch: (03:01)Now, how do these different skills change or adapt when you're looking to be an entrepreneur?  Fatima: (03:08)So what are the three realized and running three, four businesses of my own and then successfully selling them off my technical skills. As much as I thought they would either be center around my entrepreneurship journey, they were not. And I think that's a big common mistake that we make as accountants. We feel that because you know, I'm a charted accountant, I know what I need to do with the technical skills at the center know I find that your business acumen, your business knowledge is the most important thing when you start your entrepreneurship journey. They, you know who you do business with, the client you get into, they don't really care whether you're a charted accountant video to qualify the content by proficient, they have a problem and they need to understand that you as a person have the skillset to solve that problem for them. And they may not even realize that it's an accounting problem. So you need to be able to, again, the business actually meant to show them that the skillset that you have actually matches, and this goes with any business where they use starting their retail businesses as well. Customers and consumers will come in with a certain need and you have to be able to identify and resolve it for them. The second thing that I find is really important is on the leadership side, we learn accounting, learn everything on that but none of us had really thought leadership skills. So in that post communication, networking, networking is, you know, a baby that everyone uses. Attend networking sessions. Why don't you meet with this one? But how do you it yet? What do you go and what do you want to get out of attending things? Because time is key on skins, 50% of your time attending different events and you don't get any leads from me. So it's your leadership, your communication. When you attend these sessions, who are you targeting? Who are you going to meet? How are you going to start the conversation with them? Need to think all these things through before you go in. And the last bit is you need to identify within your mentors who's the right people to help you unlock the path that you need forward. Because an entrepreneurship journey can get very lonely and you cannot really resolve everything on your own. So you need to understand that it's certain points you will need help. And who are the people you can turn to for help. I remember when I started my practice the first three months I had not one client, not one lead. And that was really because I sat and I said, you know, I'm qualified to offer service. This is what I'm worth and I'm not willing to talk, negotiate or even understand what's happening in the market. And three months with not a client and then realize, you know what, entrepreneurship doesn't work like this.  Mitch: (06:03)So you've used the word business acumen a few times now, but in preparing for our call, I know you referenced business savvy quite a few times, so I'm curious, what does an accountant who is business savvy actually look like?  Fatima: (06:17)So I could find an accountant who is business savvy, what do they look like? That's the person who has a seat at every table with business decisions that are being made with strategies in discuss. Your opinions are actually in us and you have people who make these decisions within the organization come through and saying, Hey, this is what we're thinking. we heard your presentation or you really helped us on this exercise. What are your thoughts around this? How do you think we should approach this new contract that we are looking at signing with this customer? Do you want to join him in the meeting? And then when you join in, in the meeting, it's having a voice on the table that's actually hurt. And that's when you realize that your business acumen has translated to becoming business savvy. People now know what you bring to the table and people can see you as beyond just being the accountant in the business.  Mitch: (07:16)Many of our listeners are more corporate accountants. So I'm curious, how does a business savvy accountant function in the corporate world as opposed to the entrepreneurial environment?  Fatima: (07:29)So the key difference in the key item that's different in the two, and I've had seats on both sides. When you're in the corporate world, you know that those deals are around, you know that customers are, they, you've got a client base, you've got that support structure that I mentioned that in an entrepreneurship journey it can get very lonely. In a corporate world who know you've got a team of colleagues, whether it's your peers, whether it's your seniors or with the subordinates you work with and who each one has their item that they work on. And then as a business savvy accountant, you would work on identifying them and bringing everything together through the numbers that would tell a story. And in an entrepreneurship journey there'd be all the inner work which really ends with you. So who need to be able to then find the pieces within your network that can help you. Whereas in a corporate world, you know, they sitting in the office with you and then you work on building the relationships, you work on getting the people together, you work on playing the part that you know what you can collect the information and help them to be able to get what it is that they want. Because when they get what they want, then you also ultimately achieve what you need to.  Mitch: (08:45)And what advice do you have as far as professional development to help guide accounting and finance professionals through their careers and into these successful business endeavors?  Fatima: (08:56)I think the first thing that's really important is, you know, sit and listen, observe, understand what it is that each person is doing and what it is that they need to achieve. Because once you understand that and once you miss it, you don't have so much of information that then you can use to translate and different needs that you can help to follow. And as you help others achieve what it is that they need to, you'd be able to progress your career as a business savvy accountants. And you know, I mean in the beginning when I never had a seat at the table, what I would do is to say, Hey, I hear there's a meeting on about this. I'm quite interested, could I come in to listen and see what's going on? I'm asked because until we are not known as the person to come to, you will need to show that you are willing to listen. You're willing to sit in and help them solve their problems. That could be the first one. Second is we don't invest enough time as accountants in our softer skills that comes from communication, leadership, empathy, and the way I would industry is evolving, I would call it evolution. We need to learn how to evolve with it. And that comes with understanding the softer skills. How do you listen to people that they actually feel like they heard and that they want you to help them solve a problem? How do you help people who are your subordinates to grow and progress? You know, how do you help solve business problems because you've got the number skill. But if you don't have the skills to take that knowledge and work with the business leaders and how to put in a solution that's into and not just say this is the process, this is what you need to do when you're going to follow it. But to say, Hey, this is the process. I understand we need to meet driven new targets of $10 million. I understand where currently it's six in the customer that you're looking at doesn't qualify based on the policy that we have. So I'm thinking how about we structured it in this way? So you're using your technical skills and then you mixing that in with business knowledge and communication to help everyone achieve what it is that they need to do. So definitely invest in soft skills. And the last point is getting into a lot of us work in terms of finding mentors within the business or you're appointed someone, which is great, but what I find really works is having a mean tool that's not within the business because sometimes you need to speak to someone who's not invested within the business, who has an overall external view so they can help you see the blind spots that possibly you or your mentor within the organization, obviously not.  Mitch: (11:51)You have very practical for many of these questions. So I'm curious a little bit about what your background has been. I know ultimately you're in business coaching and entrepreneurship, but how did you get to this point and what did you learn along the way to offer this kind of insight?  Fatima: (12:08)Yeah, so I started my journey you know, did my articles and the gene was always to be an audit partner. And as you go through the stages and as you take off, you know, okay, I'm the, you sit in, you realize that this really isn't what's giving me a deep sense of satisfaction in terms of what I'm doing. And that then evolved into every stage that's I've taken from being in the environment. I've been had the need to run my own business. And I'm so grateful that I did that because that's what helped me. I mean, till today I have my colleagues and ex colleagues who say, but the other finance controllers, they don't see things the way you do. Or please speak to your peers or speak to your boss. They don't understand. And I think that the reason why I understand is because I actually sat in their position as an entrepreneur saying, if I don't sign this deal that needs that, there's no money for me at month into to pay the bills. And that makes you realize that you need to go a bit further. The process is not the be all and end all. You need to abide by that. And that thing evolved. You know, once you've done with that. And when I ran my businesses, what I missed was the big corporate challenges because as a small business you don't have that. And the opportunity came for me to again get into business and I really want to make a difference on what the business to achieve it. And what got me into coaching and mentioned is the sheer happiness I get by helping people because they've got the skillset they know how to, they just don't know what it is that they need to do within the environment that they're in to unlock what they have to. And to be able to, through my experience, help them to say, why don't you approach it in this way or have you thought about this? And the most important thing is not to say you should do this or I think you should do that. Have you thought about this? Why about thinking of doing it in this way? Always phasing it in that way. And really Mitchell for me it was that happiness, you know when we achieve as a team, when you can actually see how people progress. I mean, in my business, some of my clients were people who were matching me, accountants who are now CFOs or running their own business because it's an evolving world and yeah that's why it's always what next, and that's been, I am now.  Announcer: (14:44)This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Connect with Laura: https://www.linkedin.com/in/laura-landmark/ https://www.youtube.com/channel/UCbedHQf3GYH46-QoqMODU3g https://www.mantleanalytics.com/blog Software: https://www.bizviewsystems.com/bizview365 https://onestopreporting.com/ https://powerbi.microsoft.com/en-us/ FULL EPISODE TRANSCRIPTAdam: (00:05)Hey everyone. Welcome back to Count Me In. IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson. And today we're going to hear episode 29 of our series. Our featured expert guests for today is Laura Landmark, who spoke to Mitch from Norway about business performance management for a concept that everyone may not be too familiar with. Laura does a great job making important connections for accountants. So let's go ahead and listen to what she has to say.  Mitch: (00:37)What is business performance management? Why is it important and why is it so hard?  Laura: (00:44)That's a great question. Business performance management is actually a set of processes really that enables the, you know, the managers to to keep track on whether they're actually heading towards achieving their goals or not. I think that many people these days call it financial planning and analytics and you know, so there are, there are different words for it, but the reason why it's important is that without keeping focused on how the company's performing, there's a very good chance that you're not going to end up where you want to be. And especially with these days, things moving at the rate of knots, you know, moving so quickly, it's important to be fully on the ball and keep a track month by month, week by week, day by day, whichever is the relevant time-span on, on how you're performing against the goals and the targets for the company. And the reason why this is so hard is basically because there are so many moving parts, so it's not easy to, you know, to basically capture the actuals that are in the economy system and match them up potentially with the time registration that's going on in the time system. And then the project transactions that are in the project system and the whole ecosystem of, of different applications that exist in an organization make it very difficult to actually do unless you've got good systems in place of course. Mitch: (02:15)Now our main audience is the management accountants and you referenced financial planning and analysis. So from FP&A or business performance management, what is your view on the budgeting and the forecast that accountants are typically responsible for?  Laura: (02:32)Yeah, that's, well that's another good question. I can resonate with your audience cause I'm also a chartered management accountant. So I took my exams in London, well many years ago, I think about 20 years ago now. And I have spent an entire career trying to look at the future of companies, the different companies that I worked with or worked for because that's what we're trying to do. You know, as management accountants, we're to take data and to utilize it for reporting, forecasting and prediction. Budgeting and forecasting are extremely important. I would say forecasting more so than budgeting because it says it's live information. Really, when I talk about forecasting, I'm talking about rolling forecasts. So every month that goes by is another month of history and an extended month on the end of the forecast, whether it be a 12 month rolling forecast or an 18 month rolling forecast. You know, in reality, we've used these for all of our customers for quite some years now that we've been working in this way. And I've had many stories of customers that have been able to use the rolling forecast for effectively managing their businesses and also avoiding potential fools and, and threats. So one particular customer that I worked with, she was very proactive. This was a few years ago now, and she wanted to build a very detailed cashflow forecast because I think she could detect that they were potentially troubles ahead. So I worked with her for a while and actually understanding her business, I'm putting together a driver base full cost for her, which would roll forwards and it rolled forwards for 18 months. So every month that went by, she could look forwards and see 18 months into the future. And what she could see that in month 16, there was this big cashflow Dip and for a number of different reasons, it meant that she needed to go and renegotiate some, covenants with the bank. Now, what we found and what I found is that if you can go to the bank with a full cost and with a set of financial statements that show, you know, your, profit and loss, your balance sheet, your cashflow forecast in, you know, a period of say 12 to 18 months, they love it. And it's so much easier to go to the bank and renegotiate terms when you actually don't need the money. You know, when you get to the stage where, you know, in crisis and you need the money now, then it's very, very difficult to actually work, you know, with the banks. Naturally they see the risk of lending the money or extending the times. So I would say, although full costs, you know, they, they can't tell you the future, nobody can tell you the future. And the goal of forecasting is not actually to predict the future, to tell you what might happen and to allow you to do that scenario planning. So what if this, what if that, and as I say every month that goes by as new information allows you to, to adjust the forecast, it allows you to play with the figures and to create a future before the future happens.  Mitch: (05:46)So many of our previous conversations have been around data analytics and how there is technology available to really enhance this efficiency that you were talking about, you know, enable our management accountants to offer more foresight as opposed to insight into what's currently going on. So I'm curious what kind of technology you know, you are accustomed to or you know, is available to accountants to really improve in this planning and overall business performance,  Laura: (06:15)Right? Yes. Well we primarily use three tools for this. And when we started all business, we went actually all over Europe looking at different types of tools, different types of software to actually create the kind of environment for our customers that we wanted to be able to create. And what we found is, you know, a range of different great software, you know, so there's a lot of software out there, but for us it was important that it was SQL based because that's what our skillsets are. So what we found a is actually a Scandinavian product, which has recently been bought up by I think an American company actually, but it's called Bizview365. And what happens? Well what happened when we found this product was that it wasn't particularly set up for accountants. Now accountants, you know, we work a lot with accountants and they typically have a portfolio of let's say 300 or 3000 clients. You know, they're often working with many, many, many companies. And this particular product that we found called Bizview365, it was more for larger companies originally. So we actually worked with them to make a new vertical for accountants. And what that meant was that we were able to implement the software and roll it out very quickly to multiple companies. So that's one piece of software that we use. And the reason that we chose it, as I said, is it's SQL based. It's open at the back end so that we can integrate it with all sorts of different data sources and it's a planning too. So for us this was critical. We had to have a tool that could be budgeted in or forecasted in. And yeah, having said that, we also work with another product called one stop reporting, which is also a really great product. It's also a planning tool and it's something that's very user friendly. It's very a nice tool to actually build up budgeting templates in rolling forecasting templates and, nice report packs. So they're two very, very good tools that we use. And then we also use Microsoft power BI for visualizations. It's an extremely, you know, effective and well loved visualization tool. Fantastic. The dashboard's fantastic. Fantastic. Visualizing data. The only thing about it is that it's not a planning tool. So we can actually connect yes, power BI with a planning tool on the back end. So if we have customers that are particularly keen on using that for visualizing data, w we have ways and means of making it into a planning tool, if that makes sense. So for management accountants, I would say that when they're looking at software, it's very important to look at the planning element because not every tool is for budgeting and forecasting. Some of them are just for visualization. And in my opinion it's not enough, you know, as management accountants, we need to be able to forecast, we need to be able to plan for the future.  Mitch: (09:19)I'm just curious, based on the tools that you mentioned and that you regularly use, how has that transferred to results for your clients? What kind of benefits have you actually realized in implementing these new technologies?  Laura: (09:33)Yeah. Okay. That's another great question. Well, it opens up a new world really for our clients. And I think that once our clients get an initial taste of how, how it could be, you know, how easy it can be to actually get to their data, without the toil and the struggle and the long hours and the stress and the strain of trying to do all of this manually, then not only does it give them a great level of insight and a great level of, you know, depth of information, but it also removes a huge amount of, of stress from the organization. And so, you know, it's actually life improving products, I would say. So we've worked with them many different types of companies from, as I say, a lot of accounting practices who are typically the ones that are deep down and dates or need to churn out reports, satisfy different customer's needs. They want to be able to tie their customers to them. And the only way really to do that in this day and age is to offer the customer something over and above. You know, the, the bookkeeping really. And we all know that we've all had that, you know, many times over the last few years. So what a lot of the accountants that we're working with look for is, okay, what, what can we offer our customers? What, how can we understand our customers better and give them customized reporting. So from the accounting practices point of view, using these tools, is the difference between actually maintaining the customer or potentially losing the customer? I mean, there's so many examples that I could cite and there are very many customized projects because every company is very, very different. Yeah. But the impact is both financial and it's on the efficiency and it's actually on the enjoyability of actually being in the business. You know, actually automating all of these things using this software. But having said all of that, I think it's probably, I'm quite clear to see that the kind of projects we work on are not out of the box kind of projects. The software that we use is very configurable. It's very good, powerful, and it needs to be screwed together in the right way. So it's not the kind of software that you can just necessarily just deliver and walk away from all. Although having said that, you know, if you want to use it just for simple financial reporting, of course, you know, there's a lot less user intensive. But the beauty of the software is its power. It's what you can actually do with it. So once our customers get a little taste of, Ooh, you know, that was great, you automated that report for us, can you now do this one? And we say yes, of course we can cause, cause as long as we can get to the data, we can do whatever we need to do with it. You know, we can clean it, we can transform it, we can model it, you know, whatever needs to be done. We can do it because we have developers in, in our, in our company that are able to, to script and code the data. So I always think now that, you know, I am an accountant through and through, you know, by education and by profession, but I no longer see the accounting as being a standalone skill. It has to go alongside the technology and the development skillsets that if I don't have, I need to be able to work with people that do. It's essential.  Mitch: (12:53)Well, you just hit it. I know we've talked a lot about how the role of the accountant has changed and we attribute much of that to technology and the need to be more strategic. But my question is how can accountants learn about these skills or develop these skills further to be able to take their organizations to that next level and really transform the business for future success? And to kind of add onto that, what is the future of accounting?  Laura: (13:19)Right. Okay. Yeah. Well two great questions there. I think that for the accountants themselves, they are April I think to get the best education by doing, you know, no accountant comes out of school completely, you know, savvy and for the practical experience necessarily, you know, and knowing all the answers, you know, and every business is different. So if we think about an accountant who may have a portfolio or 20 or 30 or 50 different customers, they are never going to know the business as well as the customers themselves do. So my best advice about learning more about how to, you know, become more business focused and develop your business acumen is to spend more time just having conversations with the customers. And I don't mean conversations like how's the weather and all of that, but I mean actual conversations about the business. So what are the goals of the business? Do they even have any goals? You know, what is the mission and the vision and all of those things. And what they'll probably find in those conversations is that many of their customers really don't have a clue, but they like being asked. And it opens up a new conversation with the customer about, okay, well look, if you're not sure what the vision and the mission and your goals and values and all of that, or let's work on bows together. And in that process, you know, the accountants, they were able of course to, to go away and Google and find out more the industry and to look at best practice and to look at their common key performance indicators that are used in that particular branch. And to come back with a bunch of ideas. But really it's about listening to the customer, listening to what the customer's worried about, listening to what, you know, it's keeping the customer awake at night and then working with the customer to find solutions for that. Now the accountants, they might as well know that, you know, that there is the technology that can fix more or less any problem. So it, you know, often it's not a technological problem that one's facing. It's often about business process problem or it's a, you know, there's inefficiencies or there's a lack of communication or transparency or lack of focus or a lack of, you know, often companies have a million different projects or a million different products going on at once. And you know, it could be as simple as saying, okay, well let's, let's look at your portfolio paradox. And that's figuring out which ones are profitable or not. And the accountants, they know how to work with numbers. It doesn't have to be high tech to start with either. It could be just dumping everything into Excel, putting on a pivot table or putting on a power pivot or whatever and just analyzing the data. So I think learning by doing, I'm being in a lot of, strong interaction with the customer is one great way. With regards to your question about where I think the profession is going, well, I think it's going to be more and more business focused. I think that the requirement is going to be more and more that we as accountants actually understand how businesses work. How do they generate value? What is the difference between a business that's going to survive and a business that's not going to survive. How is it that businesses should, you know, strategize? Should it be based on price? Should it be based on differentiation? You know, we should, as accountants really be keen on knowing about what makes businesses tick. What makes businesses valuable? What do customers want? How you know, what are the trends in the market, particularly what are the risks, you know, we can quantify those risks. We're really good with numbers and we should quantify the risks because I think one of the main skills in businesses figuring out what not to do, you know, what should we drop what in our product line or, you know, in our project, portfolio or our customer base, who is it that's just costing us money? And, and you know, who are we not jelling with? You know, where the customers that we're really, we should say sorry, but we can't serve you anymore. You know, you'd probably be better, better off going somewhere else because you know, we have a completely different set of values and it's difficult to work together. So I think in business it's all about making great decisions. And in order to make great decisions, one needs to ask really great questions, you know, so it's not all answers. And I think that's a thing that accountant's always so terrified of is, Oh, you know, like, I don't know the answer to that. Well, it doesn't matter because it's the, that has the value, you know, by asking the question, you've opened up the possibility of, you know, a great conversation or, a thought process or a planning process that might never have happened, had the question not been asked. So answers are great and answers are valuable, but if you don't ask the questions, you never going to get the answers. So learning how to ask questions I think is a really important, part of where our profession is, is going to go.  Announcer: (18:20)This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

FULL EPISODE TRANSCRIPTMitch: (00:05)Hey everybody. Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host Mitch Roshong. Thank you for joining us again today. You're about to hear the third bonus episode of our IMA focused mini series within Count Me In. We're going to listen to Adam speak with IMA CFO and senior vice president of operations, Doreen Remmen. This episode will be especially relevant as you'll hear Doreen talk about her various responsibilities which really highlight the changing role of the CFO in today's industry. I'll let Doreen and Adam fill you in on the rest. So let's head over to the conversation now.  Doreen: (00:46)So Adam, it's really nice to have you visit me here in my office today.  Adam: (00:50)Glad to be here Doreen. Could you tell us a little bit about your roles and responsibilities here at IMA?  Doreen: (00:56)Sure. Well, as you know, I'm the chief financial officer and I have the traditional role of leading the finance organization. I ensure that our financial reporting and regulatory reporting are timely and accurate. I lead the budgeting process and I work with the external advisors, the accountants and attorneys, who keep us moving in the right direction. And thankfully I have a very professional finance team in place that's led by a highly skilled controller. So I have other responsibilities as well. My title is senior vice president of operations and my role goes beyond finance to include information technology, human resources, customer service and facilities. And here again, luckily I have wonderful teams in place and talented leaders.  Adam: (01:46)So during, I also know you work with the board of directors. Can you tell me a little bit more about that?  Doreen: (01:50)Okay. Well, my favorite part of my job is being the staff liaison to the strategic planning committee of the board of directors. And in this role I ensure that we have a continuous systematic process for refining our strategic plan every year. And that includes collecting input from our stakeholders who could be our members, our staff, our board, our vendors, performing an environmental scan and risk assessment and communicating the strategic priorities.  Adam: (02:22)So we know that there's many changes happening in the accounting industry. So how do your various responsibilities reflect those changes?  Doreen: (02:31)Well, Adam, there's been a lot written about the changing role of the CFO and I think more and more finance leaders are broadening their scope and becoming involved in strategy. And I think this is very true in large companies, where the CFO may have been seen as a functional trusted advisor in the past. That CFO is now being called upon to be a true business partner in strategic decisions. And this requires that we expand beyond a financial reporting and develop those analytical skills that help us predict an influence the future. But I'm asked this question quite often, Adam. And what I've said before is nobody told me at the beginning of my career that I was supposed to just stay in the finance function and I had the opportunity to work as the finance leader in mid size companies typically, but not always privately held. And as the CFO I was always the next person to the CEO in every business decision. So people relied on me to bring my analytical skills to different roles. Uh, in the company that I worked at before IMA I was able to move into a vice president of supply chain role. I also worked as the vice president of sales and marketing for a period of time. Having competent leaders on the teams that reported to me was really important. Having a highly competent controller in place enabled me to trust that she had everything under control. And I could step away from finance when necessary, go on a sales call, close a deal, or visit a supplier's factory and try to understand if they had the quality systems in place that would make them a reliable partner in a supplier managed inventory program. So nobody ever told me I was supposed to stick to finance. If I'd gotten that lesson early in my career, I think my life would have been a lot simpler. But I've enjoyed my career and I've enjoyed being in a lot of different roles and I have a lot of different roles here at IMA as well.  Adam: (04:43)So as you've already mentioned, how your different roles here at IMA kind of spread that and you've become that business partner with, you know, whether it's with the board or helping out with operations and in the finance function as well.  Doreen: (04:58)I'm just naturally curious person. I'm nosy. I like to get involved in different things. And uh, here at IMA I'm passionate about what is going on because I'm an IMA member and I am a, was always a really important, support system in my career. So I'm passionate about making sure that we're doing the strategic things that will serve the profession in the future.  Adam: (05:23)So on that same note, measurements and metrics are obviously very important for the CFO to monitor, as you've already mentioned. So what are a few keys of your key performance indicators or goals as a CFO at IMA? And how or why might they be different from those at a CFO to public organization?  Doreen: (05:41)Okay. So many of our financial metrics are very, very similar. Even though we're not for profit, we operate like a for profit business, in a very disciplined manner. We look at all the traditional indicators of financial that include profitability, cashflow and balance sheet ratios that measure liquidity and stability. Of course we do all of those things, but as a mission based, not for profit organization, not everything we do has dollars attached to it. So we look deeply at measures of member engagement to understand whether we're delivering the value that we should be.  Adam: (06:20)So one of the biggest areas of emphasis in finance and accounting competencies is data analytics. And we had, I may know that a very important and so how heavily, how heavily do you use or rely on data analytics for financial decisions and recommendations?  Doreen: (06:37)Well, we rely very heavily on data to support our decisions. We try to walk the walk here at IMA and we know that data analytics are very important to all of our members. We look at leading indicators in our data such as the number of new candidates for the CMA program. We also look at things like pass rates on the exam by region and it's very important for us to understand the trends as they're developing. My staff has been exploring new technology products such as Tableau and the advanced features in Excel to unlock the secrets and the trends that are showing up in our database. We also look at external data such as the GDP in our target markets and the numbers of students that are graduating from accounting and finance programs at universities.  Adam: (07:27)So how do you think the use of those new tools that they're looking at will help IMA]?  Doreen: (07:33)Well, one example is using Tableau, we were able to look historically at how likely a candidate is to purchase a subsequent exam after they have either passed or failed on their first attempt. And we found that that's very different by region. So in the United States, people get discouraged quite easily and aren't as likely to, to sign up for that next exam as they are in some of the other parts of the world. So we know that we need to work on communication and support of our candidates to make sure that they actually take those steps and get through the program.  Adam: (08:16)So shifting gears a little bit, how do you keep up with industry news and other changes to the accounting profession?  Doreen: (08:23)Well, I read a lot. I spend about an hour every morning sitting with my coffee at home, reading various things and I've always been a very heavy consumer of IMA materials, including strategic finance magazine and our CPE products. Adam as you know, I've been a member of IMA for a really long time, over 25 years, much longer than I've been the CFO here. And I've always turned to IMA to keep me informed about my profession.  Adam: (08:53)I mean, that's great. All the things you're reading Doreen and keeping up with the industry news. Are there any examples of something you've been reading or something you came across that you've been able to apply, to your job?  Doreen: (09:05)Okay. Well, recently I've been reading a lot about business in various geographic regions where IMA, is rapidly expanding. So, you know, I'm reading about doing business in China, doing business in India. I'm planning a trip to India in the next week and I've been reading articles in the economist and, and other sources in preparation for that trip. So I've always found that there's synergy between what you're reading and what you're doing at work and that's a concept of flow happens when something that you just read can be immediately applied. And that's happened to me several times.  Adam: (09:45)That's great. Which part of the finance function has changed the most in your time as CFO and what do you envision changing even more with the finance function in the future?  Doreen: (09:58)Well, undoubtedly it's the speed and ease of doing the analysis that support, you know, both the monthly close and decision making. Great companies have always done these analyses. They've always known their customers and stayed on top of the trends that drive success. But now we have technology tools at our fingertips to produce graphs and reports instantly that would have taken days to do in the past. I remember doing graphs with colored pencils on graph paper when I first started out. The change has been gradual and incremental. Every year as we found ways to be more efficient and effective. I think that's really the biggest change in the 25 years that I've been operating in this.  Adam: (10:43)So what advice can you give to somebody who is a CFO or is just starting out as a CFO so they can stay up to date with everything that's changing within the finance function so that they can serve their company the best?  Doreen: (10:55)Well, stay on top of what's happening in your company's industry. Stay connected with the leaders in all of the various functions, operations, business development, research and development. Everything that's important to your company you should be on top of, but you also need to be the one that keeps on top of technical skills. Make sure that you're up to date on changes in gap and also the changes in technology that are really revolutionizing our workspace.  Announcer: (11:30)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

George Azih bio: https://leasequery.com/about-us/leadership/#georgeContact George: https://www.linkedin.com/in/georgeazihleasesoftware/FULL EPISODE TRANSCRIPTAdam: (00:00)Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson. And for this week's episode, Mitch spoke with the CEO and founder of Lease Query George Azih. This conversation focused on ASC842 and how lease accounting software can help businesses enhance their processes when complying with the new lease standards. George also offers a unique perspective on future changes to accounting standards. So let's go to the conversation to find out more.  Mitch: (00:35)I know FASB has issued new standards pertaining to leases recently. What triggered these accounting changes?  George: (00:49)Well, Mitchell, thank you so much for, for having me. Essentially it all begins and ends with transparency, right? essentially the boards FASB and ICB are concerned with making liabilities, which by definition mean obligations to make payments at some future time. Making these liabilities actually be reflected on the balance sheet under current gap and undercurrent for us what we have, most leases are called are classified as operating leases and these leases are no longer reflected on the balance sheet as liabilities are. The boards are trying to increase transparency and make financial statement users understand set transparency. And what they're trying to do is make those obligations to make lease payments be reflected on the balance sheets of companies that are, you know, entering the sunset set at least transactions.  Mitch: (01:51)And what are the biggest challenges with these new rules? How have accountants been working through some of the challenges to make sure they're complying with these new regulations?  George: (02:00)Well, interestingly, there's these three major items, right? One is complexity, the second is time, and the third is completeness. So let's start with complexity. The rules, the new lease accounting standards are 492 pages, right? 492 pages of documentation. Literally these are, I mean it's the fixed stack. So the sheer complexity of the new lease accounting standards is a big challenge. There's also some amorphous or a big use details there, right? Where companies have to, it's not exactly rules-based. So just to predicate this FASB is moving from rules-based accounting. So principles based accounting. Well this means essentially that rather than give you an exact means to explain the way things are supposed to work, they're giving you a general guideline. And what that means essentially is that it's not in black and white, right? So there's a lot of challenges with, first of all, understanding the spirit of what the boards are trying to issue versus the actual way they want you to account for it, right? So the sheer complexity of this standard is a big challenge. The second thing is how much time it takes to comply, right? There's a lot of things that you'll have to go through. Think about a large global corporation or even a small one. Think about the people that are within that organization that need to take part in the requisitions process, which leasing falls under, right? It could be someone in legal, it could be someone in purchasing, it could be someone in supply chain, it could be someone in accounting, right? There's so many people that, that any leasing, any particular lease introduction could could go through. And as such, if you want to capture your entire lease portfolio, these are the individuals that you or the departments, you know, accounts receivable, accounts payable, I'm sorry, not in accounts receivable, but accounts payable. These are the different departments that you have to actually hit. So in a global corporation, it takes a lot of time to coordinate such efforts. Right? The last part is completely it is very difficult for large corporations or even small corporations to determine, okay, what is my actual portfolio of these transactions? Right? It's not just the challenge here is that you don't identify a lease by reading the contract and it says you are leasing this asset, right? There's different things that could be deemed a lease. But in the contractual terms, it never states that it's a lease, right? So companies have this challenge where they have to look at all their contractual obligations to determine, okay, do I have all these, is this the least that should be that should be complied with under topic 842, 842 is the new lease accounting standard, is this a leak that should be followed under 842 or is this a service, a service contract? Right. So, the big three things there are complexity, as I said, time and completeness actually getting a complete look at your, your entire portfolio.  Mitch: (05:23)Now what are your personal experiences with these new lease accounting rules? You know, what specifically triggered your initiative of creating a lease query?  George: (05:36)Oh, that's a great question. And in my previous life, I used to be, I used to work in financial reporting and in accounting research. And that was my main role. Essentially what that meant is I had to look at what the upcoming guidance is. Upcoming guidance from what's called the EITF is called the emerging issues task force from the, which is a subset of the FASB, and figure out, okay, what are the upcoming rules that they're going to make and how do I make sure that the company gets the preferred accounting treatment? Right? So that was my main role. Now in the same company we, the company had the change auditors and they went from one big four firm to another, and the new auditor said, okay, we're going to take a deeper dive into the financials. And what they did was they looked at every single area to be deemed a risk worthy. And one of the areas they looked at were leases while they pet the pen of the least 10 of the leases at 10 out of 10 of them were wrong. They tested another 10 and tell them the tenor or the world. So basically there were batting, you know, zero out of, you know, zero out of 20 which obviously, you know, is below the Medusa line. So essentially what happened there is that they had to go through and figure out, okay, how do we account for leases in a global corporation? And the chief accounting officer tasked me with teaching the different controllers. I said this was a global organization, how to account for leases. Well, the challenge there was this was accounting for leases under the current at the time, current lease lease standard, which was relatively simple, right on the previously standard was it was topic 840, right? The new standards before the two. So this was accounted for under the easier method, which is 840. Now the boards change it obviously it's 842. And in my role as accounting research and, you know, financial reporting, that in that role, I knew that the boards were changing the rules, right? Going from this easy process to the new co, more complex guidelines. And so I figured, well, if as a company they were having challenges applying easy 840, then by God, when the new rules come and change when the new rules change, then it's going to be a huge headache for them. Right. Once again, batting zero out of 20 under current guidelines when it becomes more complex than it's going to be a big headache. So that was kind of what triggered, you know my, I guess going down this rabbit hole of solving a very difficult problem. So that's my experience with it. You know, I used to be an accountant that was faced with this problem. And so our solution, lease query is literally really focused on solving this problem primarily for accountant. It's an accounting problem and as such, you need accountants who have experience it to solve it.  Mitch: (08:57)Now I understand in addition to these challenges, there are also some hidden benefits that kind of come along with the new lease standards. So what exactly are you doing at least query to enable accountants to unlock these benefits?  George: (09:11)Well, that's an excellent question. Everyone sees this as a burden, but then every burden within every burden lies opportunity. Right? And, and the opportunities here are tremendous. As I said, the having a holistic view of all your leases in one place, that is a huge advantage because then you can start to become strategic, right? If you look right now, only 54% of public companies have actually adopted the new lease accounting standards, right? Only 54% that that's a testament to how complex it is. Now, the 54% that have actually adopted tend to see a lot of great benefits, one of which is they now have a holistic view of their assets right there. There are companies out there that are still making payments on things like forklifts or copiers that they have since returned. This literally is going on every day. Companies are making payments on assets. They, they no longer have. Our software helps them identify this and make sure that, Hey, you have a complete inventory of the leases that you do have, the assets that you are currently in possession of. Right. We saved a client $275,000 in tenant improvement allowances that they were supposed to receive, but they never did. Right? There are payment changes that you have to rely on the landlord for, which is, you know, cam for common area maintenance. These are payments that the landlord tells you you owe that if you have, you know, more than 30 locations, you don't, you don't have the, the benefit of Google or the resources to go through and check every single line item that the landlord says that you owe. Right? Our software, once you put that, the lease terms in there, if the landlord tells you an amount that it's different from what the contractual agreement presents, then essentially our software will flag it. So these are all benefits that, that our clients are currently seeing. Right. And you can tell from the reviews if you go online. Does that answer your question?  Mitch: (11:22)Absolutely. Now I just want to make sure our listeners fully understand that this is a software company. So tell us a little bit more about the innovative software technology that is out there in today's accounting industry. And really, you know, kind of how you're using it and how others may be using a different technology to improve efficiency across the organizations of the clients that you're working with.  George: (11:45)Well, that's excellent because accounting in general is a very conservative, to put nicely is a very conservative profession, right? No one likes a creative accountant and accountants in general do not like change. So it is an industry that is ready for technological advances. There are companies out there that are doing great things. Companies like Flo Cast, you know, for reconciliations, companies like Wachivia for financial support companies like us least query, right? So technology is affecting the accounting profession in ways that gives accountants more time rather than chasing down data to actually analyze data. Right? The, the vast majority of accountants out there spend a lot of time chasing data down and saying, okay, this is how we're gonna comply. And so you resolved, accountants spend a lot of their time in the past. Companies like Wachivia as I said, like flow cast, like, like you know, even even the newer general ledger systems, these companies enable accountants to change data from just being actual data into information, right? There's a big difference between data and between having data and gleaming information from that data and that deals with how quickly you can assess and analyze that data. Right. At least query, we are revolutionizing the leasing industry because we can tell you, okay, you know what, I had a client the other day that told me that we are borrowing rates are spectacular. And I was like, how certain are you of that? Right. And he was like, well, I'm pretty sure that they are. I just know, well, a lot of times you can't just know. You have to glean that data. We've got bobbing rates from thousands of companies, right? We've got over a thousand clients now. And essentially what we can tell you where your borrowing rates lie as opposed to others. You know, obviously we don't share that data, but as a general rule, we can, we can figure out, okay, you know, what companies have the best borrowing rates and where are they getting those rates from? Right? So these are things that we miss. This is data that we have, right? And we can parse and analyze and be able to tell companies, okay, well you think your borrowing rates are great, but they're compared to others in your industry. They're really not that great. Right? So their average or you know, they're all great, right? Either way we can verify the data that you think, you know Mitch: (14:28)Now technology in general is really taking over the entire accounting profession and you know, based on the advancements that you've already discussed, if you had to guess what other new accounting standards may be coming down the pike or other change in regulations that accountants, you know, particularly our listeners may need to be aware of coming up in future.  George: (14:53)Well I think it, once again, it all goes back to transparency, right? So there's going to be more transparency and not less, right? Essentially what happens here is the FASB and the boards just because of the sheer volume of data that there is out there. The companies want the, I'm sorry, the boards wants to make sure that companies are actually disclosing information that's useful to the relevant users of financial data, right? So things like Goodwill, Cecil, which is accounting for credit losses, all I mean these are all areas that could be improved upon accounting for as I said, Goodwill for software. You just accounting for software transactions, service transactions, right? Items in the cloud. These are all areas that the boards are focusing on. They just released 606 which is accounting for four which was essentially due for revenue recognition, right? These are all areas that the FASB and, and the ICB as we is for gap US gap ICB is international fire for us and even GASB governmental. These are all areas that these governing boards are focusing on and making sure that, okay, the more they get down to the nitty gritty of giving financial users information that's relevant, the more they need. Companies like us software companies that don't transform that data into that relevant information. So with all the rules that are coming out, it's almost like it's a symbiotic relationship as the FASB issues, these rules for companies to comply, companies are going to meet software technology enabled companies to help them with that compliance process because it's not something that you can do alone.  Announcer: (16:53)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Fatema:LinkedIn - https://www.linkedin.com/in/fatemaelwakeelmbacma/Fatema's Blog: https://strategicalanalytics.com/Fatema's Articles: https://sfmagazine.com/post-entry/may-2019-agile-project-management-in-analytics/ https://sfmagazine.com/post-entry/august-2019-further-demystification-of-agile-project-management/ FULL EPISODE TRANSCRIPTAdam: (00:00)Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson. And this week's episode, Mitch was joined by Fatema El-Zahraa El-Wakeel to talk about agile project management methodology. Fatema helps us understand agile by breaking down the process and giving us a simple how to, when looking to start using this project management methodology. Let's listen to learn more.  Fatema: (00:30)So traditional project management model is really what we're used to seeing for several years. It consists of a project manager and a team of specialists who work on a project. The project team begins by meeting with the customer, can be another department or another company and external party depending on the project. And then once they collect the project requirements, they break it down into milestones. And then the project manager is tasked with keeping the customer posted on the status and completing the project. This model is really vulnerable to a lot of things like delays, miscalculations or unforeseen costs, which can be caused by the budget overruns or an overall failure to deliver a stated goals.  Mitch: (01:25)How is the agile project management different than the waterfall method in terms of, you know, the variables that come along with the project and which methodology is better for analytics.  Fatema: (01:39)So when you look at any project, really there are three main variables. The time set for the project, the resources that the project will be using, and the main thing is the scope. Oh, and in a traditional project management, the scope is fixed and obviously you can increase the resources by increasing the budget signing off an additional budget or adding additional employees to the project, the time needed is an estimate. People like to fix it. But normally, unfortunately you see overrun. In agile project management, the resources and time components are more fixed. While the scope is estimated. So you know that kind of the direction where you're going but it is not set on set in stone somehow. In agile because, because we are really responding to like the business needs. So we re we prefer using it in analytics project rather than sticking to a scope that is fixed. So normally what happens is a product owner, the product owner and the customer would agree on a, an MVP, which is the minimum viable product. I'm using this method. The time spent for the MVPs for each iteration is called a sprint. And at the beginning of the sprint normally the customer and the project team, agree on the sprint goals and the MVPs that are expected. And then they kind of establish a plan really to complete the work. And at the end of the sprint, the project team goes back to the customer to show the MVP and get the feedback. So they show the customer a demo of what they've done so far. Sometimes even you can go live with part of the project and launch it. And I think this is the benefit of using agile methodology in data analytics because you're utilizing the data.  Mitch: (03:41)Now I know there are a lot of terms that I'm sure our listeners hear frequently, but may not necessarily know what they mean. So within the agile project management methodology, what are some of the most important facets and some of the terms that you should really understand to understand agile project management?  Fatema: (04:01)That's a great question, Mitch really, because I think when you start using agile project management it's a bit overwhelming. Like when I first started i was like what are all those terminologies that people use? And what does that mean? I think few of them, well one of it is, for example the scrum and I'm a scrum is or no, those are normally regular meetings to reviews the progress of the adult project, similar to a project management manager. Oh the scrum master oversees the development process and ensures everyone is on track and it's really aligned to the planned sprints. Another term used is scrum of scrums and that happens when you have several projects, multiple teams working on different projects and they need to keep the wider team updated. Product backlog is another, term that is widely used and you can see as like list of tasks to be completed by the team, open items that the team needs to go through and kind of close in each sprint. Normally the product, owner and manages the backlog to ensure the product delivery. So he or she discusses with the, which items on the backlog need to be done. There's different like labeling, like if it's a should or could. How important is the item on the backlog.  Mitch: (05:35)Now that we have a better understanding of the terminology that goes into agile project management, what is a practical example? Can you give us a case study or something that you've worked on where all of this kind of comes together? Fatema: (05:50)So let me think of an example. So, let's say a customer described some challenges with current reporting used for pricing and they explained that they would like, that's a visualization to understand relevant issues. So it's basically a visualization and analytics project. So I'm the agreed MVP in this case or the minimum viable project would be a dashboard that helps report pricing. The team working on the project agrees with the customer to me by weekly for example, and review the progress and MVPs based on expected sprint deliverables at the start. As you can see from here, the project time is agreed and it might be three months and the number of team members is, for example, set to five. So the main, the three main, um, facets, it's really of the radar project management is you have a scope, you know, the direction where you are, and in this case you're going towards a visualization project. You have the time set, which is three months, and you have the resources set, which in this case the team members, the five team members, Oh, the product owner in this case create some backlog listing the tasks needed such as tools used for the visualization, preliminary KPIs and other reporting requirements. The scrum meetings normally would occur daily and the scrum master would ensure everything is on track. A scrum meeting is normally like 10 minutes and it's a stand up. So everyone in the team would just say what they've done this day before what they're doing today. And like if there are any blockers so that in this case the scrum master would unblock those challenges that the team is facing. If you assume that at the end of sprint one the team meets with the customer to present and discuss the print preliminary KPI and the basic dashboards. So it's still the start of the project and the customer provides some feedback. The team takes that feedback, goes back, works a bit on it, refines the products and goes back to the customer. If you assume that in the second time they go to the customer, the customer would say, well, Oh, I actually was expecting more details on pricing optimization. The team in this case would think would go back, check it, come back. But when they come back they might say, well, we were supposed to go into a direction of doing a visualization. You're asking us now to do a pricing optimization case, which is good. But that's a different scope now. So they sit with the customer and then they agree what is really important based on the current business needs. So the team might agree with the customer that the model is priority and the customer might explain that. And in this case team works on sprint three, but delivers the variables that affecting the pricing as well as explained the different internal and external sources. You can see here that there is a happier customer although the product was different, well the customer received better functionality. So instead of the team, if it was run by a traditional project management, the customer would get at the end list of KPIs visualized in a certain way and the customer might not even have seen that product at the very end. But with Agile, what happened here is that the team was very responsive to the business needs.  Mitch: (09:42)I think that's a really good example and it really covers the difference between the two methodologies. So how important is it to have a strong team in agile?  Fatema: (09:54)Oh agile focuses on the project team. So the project success really is attributable to the whole team and it creates this kind of culture and strength in the project. So the project is it's a whole team collaboration and responsibility. It's very team centric. There is no project manager in agile. This role is somehow split by the product owner and the scrum master with neither leading the team, but rather focusing on the product itself and working with the team. So the product owner focuses on ensuring customer needs are met, scrum master is part of the team, having the responsibility to facilitate the team and not really to lead them just to support them by unblocking any any blockers that might arise during the project.  Mitch: (10:48)If any of the listeners are kind of like me, where we've worked on projects and we kind of see the resemblance here of what we're doing in the agile method, how can we better learn more about agile and how to actually use it?  Fatema: (11:04)I think that's a brilliant question, Mitch. Because I think personally when I started using agile, I was so confused. I'll be very honest, coming from a traditional project management, and moving to agile. It's all about the mindset somehow. And it takes time to change your mindset from the traditional waterfall method. So the best way to learn it or how I learned it to be honest, is really by doing so start using it and work your way through it. Find an Agile coach or someone who uses agile to bounce ideas off, ask them questions. This will help you learn a lot. And put kind of the theory into practice somehow.  Mitch: (11:50)I know earlier you mentioned one of the opportunities being stronger data analytics. So how do you go about presenting agile and data analytics to your team as a project management method to use moving forward?  Fatema: (12:04)The first thing would be if it's possible, look into ways to deliver the results as soon as possible. Like have quick wins really. Start by rolling out a test phase. So stakeholders can begin to see the benefits of the project and the methodology early on. Stakeholders will also understand that they're part of how the project is shaped and they get to see the different iterations and changes. This will encourage the buy in into agile especially if you haven't seen or haven't used the methodology before.  Mitch: (12:41)How about the other side of this? What are some of the challenges with agile?  Fatema: (12:46)So well there are a few challenges. The first challenge is getting used to the fact that as I mentioned before like the project scope is really open. In Waterfall, you usually know what the end result will be and it's not really the case with agile. You know, your direction, you might have an idea of what the end goal would be. Might be clear sometimes, but it might be not, we know roughly what the end product would be. It can change dramatically due to the business needs. So I think one of the challenges is for the person doing agile not to get fixated on the original scope. But think about delivering functioning product that the stakeholder needs or the customer needs based on operating in a fast paced world. It's not a target that you need to compare to traditional. It's not like a target end scope, but rather want to make sure that I'm delivering the functional product that my customer would use. The second challenge is that time is fixed and it set in at the start. So make sure that there isn't any time. Sometimes, especially maybe customers they call this, they get a bit confused and say, Oh, can we just extend the timeline and add this and that feature to the project? You can always add phases but try to stick to time so it needs to stay well this is phase one and those are the deliverables. This is the MVP. MVP delivered. It kind of structures the project better. I think the last thing would be really sprints and requirements breakdown. This would basically come with experience. So the first project would be more challenging than the second. So just really start and get the ball rolling. We all started somewhere with no experience. Just make sure to have the right team to support and be a great team member and you learn quickly.  Mitch: (15:00)So if I were to try and start an agile project, you know, going back to something you mentioned earlier the backlog being the, the list of tasks, what does that look like? How do I actually start the project and, and create a backlog.  Fatema: (15:14)If you think proper backlog as a list of tasks really. So each project has a backlog and it should be completed by the team. Having said that, sometimes some of the backlog items or some of the tasks are not done because it was agreed that you're not using them at all. So the backlog is written in the form of stories that describe the task. It can be key words or sentences as long as they are kind of understandable in terms of the level of detail needed for the team to understand. Stories are normally recorded in the backlog in a form. Normally what people use is as a user I want to, so that the reason. So for example if I'm an end use, I'll say, well, as an end user I want to be able to calculate customer profitability so that I can approve relevant discounts.  Mitch: (16:14)Now we know the backlog is kind of created around a story. What are some other important terms or are key things that we should be aware of in the agile project method methodology?  Fatema: (16:27)One of the terms that is used is releases which are basically kind of versions of the product. For example if someone is working on a pricing model across regions, the first release might be testing it to the top 10 customer data. And that's a release. The second release can be testing the data of old customers in the United States. And then a third release can be, well, having this worldwide and because agile is an iterative method, having different releases, but this can ensure a smoother final product run out.  Mitch: (17:11)So what is the end result? How do we close out the backlog or the initial task that we listed for this project?  Fatema: (17:22)This is a great question cause sometimes you have a task and is that task closed? Is that backlog item closed or is it open that is when it comes, the definition of done or the DOD. And this is when the team really agrees on a rule to consider a task from the backlog as done. So DOD differs from one project to another but is agreed upon by each scrum team. Like for example, DOD can be when a code is written or tested or when a release is complete.  Announcer: (18:02)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in from more relevant accounting and finance education, visit IMA's website at www.imenet.org.

FULL EPISODE TRANSCRIPTAdam: (00:05)Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm Adam Larson and today we're going to listen to Mitch speak with Indra Moeljadi from Switzerland about the evolving role of a finance business partner. In their conversation Indra talks about business partnering technology in analytics, strategic decision making and storytelling. Let's go to the conversation now.  Mitch: (00:26)How has your role as a finance business partner and the head of finance changed over the last few years?  Indra: (00:37)Yeah, so you know, I said progress in my career. I found out that it's less about the data crunching and more about finding a story within a numbers. You know, days of going through the numbers on a spreadsheet, there's becoming less and less, I mean, they still exist of course there's the bread and butter, but now I spend more time putting the numbers into PowerPoint presentation and then doing some analysis on it and presenting the analysis and the story to the organization. So as a finance business partner, you know the asks from the people I spend the most possibly thought as part they are commercial minded team. So you know, they're not really great with numbers. You know, they always ask how can I help them get certain messages based on the financials across the organization. You know, and to be able to do that, I need to understand a couple of things. I need to understand the business, why they say that we do, you know, whether the products work, all that stuff. I need to understand the organization. So who are the people that I'm dealing with that I'm interacting with. And then also the last thing is what message is it that they want me to convey? Cause that's really important in trying to, you know, be the right business partner. So for me it's more about understanding and preparing a story and less about data crunching numbers. And I've seen that over the past few years. And I also see people going into finance roles. You know, the technology is there that enables them to do the data crunching. So you know, you need to do a bit more than just the data crunching.  Mitch: (02:10)How do technology and analytics skills help you and your team understand the business and the message you are trying to share as data change the necessary skillsets and how decisions are ultimately made?  Indra: (02:21)Yes, I believe so. There's a lot of data out there. You know, take, take an example. In the past when I started, I started working almost 20 years ago, still worked on paper invoices and you know what we do with paper versus we take what's important only the important bits because we didn't have the resource nor the capability to store all the information. Nowadays one transaction has a lot of data points, you know, multiple data points in there. You have to date, customer location, payment method, delivery method, stock keeping, unit currency, everything else. And now we actually have the resources and capabilities to store all this data. So yes, we need to technological skills cause we need to be able to go to this data and filter out what is important. You know, what do we actually need and then once we find what's important we need the analytical skills to come up with a meaningful analysis that will aid this with the decision making process. So yes, and when we talk about strategic decisions, these are decisions impact in the future. Data that we have is from the past. You know, the historical data. So how do we take historical data and make a decision for the future with it and, and be sort of accurate sort of where we can predict the future. And technology really helps. There are lots of tools and can predict and forecast for the future. They can do trend analysis, they can, you know, it's obviously not perfect but it really helps a lot. But then on top of the technology, you also need our analytic skills and our experience. And that's fundamental because we should be able to predict, you know, when the peaks and the dips are in the sales from an expenses should be able to predict and calculate return of investment and then adding our ethics skills and our experience on top of that. Then we get a good story and then you know, we can have the right parameters to make the strategic decision for the organization.  Mitch: (04:13)Business partnering, strategic decision making. These are popular terms today relating to finance, but another one that seems to be becoming even more important, and I know you referenced it earlier, is storytelling. So what exactly is storytelling and how does it fit into the finance function?  Indra: (04:28)So storytelling and finance to me it's a couple of things. One is translating the numbers into something coherent for the audience. Most finance people you know they get a headache when you show them an Excel table. And I've had that a lot where I give them access table and they just shake their heads and they don't want to even see it. So how do you make these people at ease with numbers? Right? So what do I do? I replaced the numbers for a story and that makes it understandable for these people. Now a lot of the senior managers in the organization that I've worked with, they don't have the time, neither nor the mental capacity to go through an Excel file. So as a finance business partner, it's our task to make the numbers understandable and to do that, you know, providing a story is a really good tool. And then also another aspect of storytelling in finances, stories have a distinct pattern, right? We learned that when we're children, as long as the beginning, a middle and an ending. And if you look at, you know, strategic decisions that, that a company's making, they also for beginning. Beginning being the reason why do we need to do this? And there is a middle, you know, to how, what's the process to get there? And then the ending, the ending is being like, what is the objective? Most companies started with the ending first, but then it all goes from the beginning of middle and ending. So by putting all of this in the story, it will help everybody. You know, cause we are as humans, we're conditioned to learn about stories all around us. Everything is about a story. That's how we are. This is how we grew up. This is how we are conditioned as human beings and also storytelling. It's the most powerful tool to pass on a message, right? But a good or bad, if you put a right story behind it, a bad message can become a good story. And vice versa. If you have the wrong story, a good message become a bad story. Right? And so, so if you have this tool, you know, use it because then the audience can relate to it and they can really understand what is going on.  Mitch: (06:24)So let's put all of the pieces of this conversation together. What advice can you give to accounting and finance professionals attempting to develop a strategic driven story to add value to their organization?  Indra: (06:35)So by telling a story, you're adding value to an organization. Now, would your business partner, would you prefer, would they prefer it? If you just give them an extra table and then get on with it. Or would your business partner prefer you tell them what is going on when you show them the numbers? I think it's most cases and I think majority, I'm pretty sure they just want to tell. They just want you to tell them what's going on. Maybe show them the numbers. They don't have time to go through the details. So providing a story, it saves times and maybe even resources so that the organization can focus on what they need to do. There's no point in just giving them more things to do and then actually taking time and resources away from stuff that they should be doing. So to be able to tell the story, there are a couple of elements, right? One is understanding the business and you know, like I said before, it means understanding it inside out. You know, what are the products that the company's providing? Well, how does it add value to the customers? How are they produced? What methods is used to sell the products? What is the industry like? Competition, competitive landscape. You know, what do the people think will happen to this industry in the next three years, five years, ten years? Obviously it's something that's quite hard to predict the future. But if you understand the business, you know, sort of where it's going to go to and what it is and how it works. And I think it's fundamental. Even though we're just finance people, I think finance is actually the heart and the center of the organization. We should be able to understand the business based on the financials. The other element is, you know, understanding the organization, the, what is the hierarchy, how do they react to the messengers, what you know, what, what is the numerical literacy of the business models and the people you deal with and, and if you know, what they need, then also gives you an indication of what kind of story you needed. You also need to understand the system that has numbers in. Nowadays actually, you know, you use all sorts of financial systems going to be in an ERP constellation tool. So as a storyteller you need to know how to get the data, where to get a data, what the data means, but also the source of the data and then how it's processed and you know, then be able to figure out how then it becomes a story. And then the last thing, you know, when we talk about storytelling, everybody's able to tell a story. I mean it's, yeah. Since school, but everybody's still taught how to say a story, you know, the beginning, middle, and ending narrative. So I don't think, I don't see why it should be difficult to tell so everybody knows how to do it. And you know, I can only stress the importance and the focus of storytelling within finance. You know, finance is more about just numbers and to be able to tell the story, you don't need a market thing or literature degree. He just, you know, you use your ability to tell a story. Use the technological skills analytical still. And I think you're probably already doing it without realizing it. So, you know, I think storytelling is really important in finance. And I really hope that people spend more time on, you know, improving it and, making it more important as part of their repertoire.  Announcer: (09:54)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in from more relevant accounting and finance education, visit our website at www.imanet.org.

Contact Khaled:LinkedIn - https://www.linkedin.com/in/khaledchowdhury/Blog: Getting started in #PowerBI for #Finance and #AccountingUnleashed  | Beast BI - http://beastbi.com/unleashed/FULL EPISODE TRANSCRIPTMitch: (00:05)Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm Mitch Roshong and in today's episode we'll hear Adam Larson talk with global finance data and tech leader Khaled Chowdhury as they discuss finance culture transformation. Khaled is the finance director of analytics and business intelligence at Cabot Microelectronics, but even with such a focus on data and technology, he really emphasizes the importance of focusing on people first and how any business transformation starts with the culture of the organization. Let's go to the conversation and see what else he has to say.  Adam: (00:42)What is your philosophy on finance culture transformation?  Khaled: (00:51)My philosophy around cultural transformation, I think it's not really exclusive to finance, but a culture is a living organism, which are the some off the people, right? And when it comes to cultural transformation, investing in technology usually backfires. And the best way I have found the philosophy of finance, culture transformation is to invest in people. However, investing in people, you also have to kind of go from an agile methodology. You kind of have to have small proof of concept, see if that works, if that works, you kind of push them on. And one of the key things as I pushed for change, even to this day, I think it's a quote from a peaceful warrior that's is the key to change is to spend all your energy building the new, not fighting the old, well. We're talking about culture transformation. It's not necessarily about finance or whatnot, it's people change, right? So essentially culture is what is acceptable, how people behave and what is and there's some at one point, what is acceptable and what is expected, right? The kind of culture dictates that part. And from that perspective, if we don't ask the question, especially in we're in the precipice of the fourth industrial revolution, it is about to change big time. I mean it has already, but it's the impacts are starting to shop in smaller spaces. People have been talking about all this new technology, whether it's gonna work or not, but the end of the day that most of the technology actually are in pretty good shape that it actually can be used. But the problem is we don't have any gold drivers. Driver means meaning the people who would drive the technology.  Adam: (03:03)So then how would you take technology, you know, thinking about how technology is going to not take away jobs but change jobs. How do you infuse technology into your organization to kind of enhance its capacity?  Khaled: (03:15)So I think I will quote something that I say to my boss, right? I say, if you want me to be around, I'm going to cause a rebellion. And he's looking at me like are you crazy? I'm, my answer was you want a revolution. But a revolution is only as successful rebellion. Right? So, and the reason I liked the concept of revolution is it happens from inward, not outward. And the reason I'm saying that is because think about in our finance organization, it would come to us saying hey, we have this great product called SAP, BPC or whatnot. They'll come to you, try to install those and it's going to make all our problems go away. At the end of the day, it takes our life. I want to try to do the implementation. But again, when it comes to actually using it, we've become slaves of the tool. So in terms of infusing technology to the business or the finest profession, I kind of see it as a relationship with the technology. Whether are you the master of the trilogy or are you the servant? Technology is an absolutely awesome servant, but absolutely a horrible monster. And coming from that perspective, the best way to infuse technology into any business on the finance function is to see how we can start inward. See take things that we're currently doing. What is it that we can do to automate and liberate so that we can focus on the next step. Right? And instead of trying to go from crawling too, running you have to kind of learn how to call better before you can even walk. Then you go from walking to running. And it is a lot of dependent on investing people to send them for training and giving them exposure to what is possible.  Adam: (05:30)Thinking about a company that is, you know, trying to infuse this new technology and thinking that it's, you know, it's good for them, you know, having that business technologist on hand, you know, what kind of carry over similarities do you see in members of that transformation team that's kind of implementing these technologies? And then how do accountants and their skill set fit in, in that?  Khaled: (05:59)So I think it's more about a mindset. So one of the concepts that's taught by Clay Christiansen, he wrote the innovator's dilemma. He's a famous professor and strategy is to focus on job to be done. It's kind of be the people who looks at the task or as something there is a meaning behind it rather than completely a task. They understand what job is performing because from one perspective, the job we're doing is not going away. But the task, how it is done is going to change. And people who can kind of come break the shackles of what has done before to be able to see farther. Right? This goes back couple of years when I was a, I was talking to my chief accounting officer and a in FP&A, so I came, came up to management accounting, then FP&A for a pretty long time now. And most of us who are successful in our jobs tend to be excellent. Right now there is two things you can do with becoming an excel wiz. You can just develop something that's nerdy or something pretty complex and for the heck of it versus whether you actually get, use it to get some job done. So it's a lot about coming out of your desk and going and trying to solve a problem. So it's essentially, it's business technology should do you have a business problem, you have a technology, go solve it. So think about in the old days, the accountants who would know whatever's to sell whatever skill set, whether it's Excel as a media, whatever they had, they would see a problem person in problem, they will come out of the desk and go solve that problem. I think the way Harvard put it is there is a premium on curiosity. So it's actually the curious mind that has a huge benefit in today's world because they usually tend to go find out what's working and what's not.  Adam: (08:18)That makes sense. You know, it's good to have that curious mind. You know, and thinking about, you know, we've been talking about technology and how to, you know, transfer me and your team in getting that technology in there. But once you have that technology, you know, there's things like data analytics that are that seem to drive our decisions. You know, what would be the end goal of creating a data analytics kind of driven culture where you're looking at the data and making decisions based on that? What's the end goal of that?  Khaled: (08:46)Okay. I think if you think from that perspective, right? Regardless of what activity you're looking at in a business The way I see it, if it has fulfilled three things, that means it will be worthy of investment. Either it would have to increase my top line already is my cost. Both of them actually ends up in a higher bottom line and there's actually a third option considered as risk mitigation. So if something mitigates some exposure to my top or bottom line or the existence of the business, if you come from that perspective, the question becomes is are we investing in data analytics? Are people making the decision process faster? And let me be honest, right? You're never going to have perfect data. It's about like it or not, it's going to come down to a lot of gut decision. Now question is how informed is your gut, right? So that mechanism is starting to change of how fast and how often can we give that information to the decision makers. And to be honest as I'm trying to build my team and we're trying to achieve a culture change, the part that I like to highlight is the most important thing is your employees. And that's why I keep coming back to training. The most important thing your you have is your employees and the people that holds you accountable is your customers. So from a finance and an accounting perspective, we have our people, our senior contents, our financial analysts and all the people that comes with it. And they are our assets. But at the same time, our customers are our business, right? So we invest in our people for them to move on. So I mean, we keep coming back to the technology, but it's about what I want to highlight, if anyone wants to take away one thing from it is how well our people are capable of using those technologies and using technologies to requires technical skills, but at the same time, it requires soft skills. And one person on my team Evalina she highlighted his, what I was saying earlier about you have to know why we're in business and what makes the business money, what makes it profitable?  Adam: (11:39)You know, you've mentioned focusing on the people focusing on getting them trained and obviously the people need to have the inspiration to actually do that training, you know? So is that kind of the first step of initiating like a complete finance and analytics culture transformation. It's kind of been a theme we've been talking about transforming your culture and in analytics and finance is that that first step is getting them out there and almost like kicking them out the door and saying, hey, go learn something new.  Khaled: (12:09)So I think the way I preferred doing it, something that I picked up from a friend of mine often sentiment and the best way he put it is you create the stage for it. So, especially if my current stage, I would prepare the stage essentially, I would sure a little bit of what's possible and I will give them a little bit of help in getting started. I started a little bit of the fire for them to see what it is. And then after that you step away, you step away for a month or two months and see all of us are busy. Right? Even the task that might go away is keeping you guys busy right now. So question becomes is who even in that stent, the curiosity gets the better of them and they will take that fire, what do you call, take the little bit of kindling and turn it into a fire. So they're going to struggle, right? So as you try to change first it's struggle. So for me, the people that I look for to be on the team or my pioneers are the people who gets started on their own, mixed up highest amount of mistakes because they're trying. So like another girlfriend of mine while in Lamar, she was a director of accounting in the beginning, she said there's a friend from Texas and she said I don't know if I can fix that. Don't want to know your mama broke. You can't fix you. But coming back to the same point, right? Yeah. So she's from Louisiana, Texas. But anyways again, it comes back to the fact that you have to be willing to learn. And that's where my identifier is, essentially, is the people who get started with the little before you invest a lot in them. And that's why I also have the advice for people who are out there. It's to get started on your own. Don't wait for the company, because when you start showing results, a company will come to you. Announcer: (14:38)This has been Count Me In, IMA'S podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA'S website at www.imanet.org.

Contact Debbie: www.linkedin.com/in/debbiejacobscmamba Debbie's Work:https://www.linkedin.com/pulse/tackling-fpa-budget-process-debbie-jacobs/ https://www.linkedin.com/pulse/improving-communication-within-fpa-debbie-jacobs/FULL EPISODE TRANSCRIPTAdam: (00:00)Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I am your host, Adam Larson and I'm joined as always by my cohost Mitch Roshong. We are here to bring you the latest perspectives and learnings in management accounting as told by industry leaders shaping the profession. For today's episode of Count Me In, Mitch spoke with Debbie Jacobs about cross functional relationships as FP&A leaders. Mitch, what kind of insight did Debbie have to share?  Mitch: (00:33)Debbie Jacobs built strong relationships to ultimately drive change at many well known companies like Hewlett Packard, Honeywell and Johnson and Johnson. She shared her perspectives on forging relationships with cross functional departments and the value of aligning all teams activities with the same business drivers to become valued organizational leaders from the FP and a team. In our conversation, Debbie was also able to tell a lot of real life examples which made her answers very interesting and engaging. Let's go to this discussion now so you can hear for yourself.  Mitch: (01:03)How do you go about building relationships with cross functional departments such as marketing, research and development or operations?  Debbie: (01:19)You need to show a genuine interest in learning their perspective and their world. And you can go about that in a many different ways. One of my favorite ways of doing it was when I was with Johnson and Johnson. And there I would spend a day out with the sales rep. My finance role there was, I was the finance director supporting commercial operations, which was sales and marketing. And so by spending a day going out with the sales rep, I was able to listen to our customers but also see my business partners, that sales rep you know, going about his job or her job all day long and see what kind of issues they came up with and how they addressed issues as they came about. And I encouraged my team to do the same and it really gave us a different perspective on our, on our business partner. So in addition to showing a genuine interest in learning their perspective and putting yourself in their shoes, it also helps to be present where the informal discussions are taking place. You know, oftentimes we're in meetings with our business partners, but there's a lot of conversations that happen around the so called water cooler. And if you can figure out where those conversations are happening and become a part of the team that way and not in a forced way. But an example I would give is why was that Hewlett Packard and I had recently joined a new division that had been acquired. So the people, my business partners were all people coming in from a company that had been acquired. They liked to play Bridget lunch in the, in the company cafeteria. And, and so I learned to play bridge, which I haven't done before. Simply so that I had an opportunity to sit down with them at lunch and become part of those informal conversations.  Mitch: (03:32)And why is it so important for these other operations or functions of the business to really buy into FP&A and, you know, how do you go about convincing them that, you know, you appreciate their relationship and what they have to offer?  Debbie: (03:51)Sure. So in my experience working in FP&A, the senior leadership of the business typically looks to FP&A as the, the voice of reason or the voice of objectivity. And in order for us to fill that role, we really need to have a strong partnership build up with the other functions R&D marketing sales. So that we can look at the analysis from multiple points of view. And with that relationship with the business partners, we can drill down in our conversations. I like to call it the, the five levels of why which some of the listeners may have heard of and we need that relationship with marketing or R&D experts to engage with FP&A so that we can do that drill down past the first level of why. So that when the senior leadership turns in a meeting and looks at us and says, you know, what do you think we have enough knowledge beyond sort of the top level skimming of it, of whatever the business case may be, to really be able to answer thoroughly that we understand what is being asked for and give a solid opinion on it. An example I would give is early in my career I was actually a financial analyst at Hewlett Packard and I was part of this big cross functional team and we were investigating whether or not to expand the plant operation. And this was in semiconductors. Do we build a new way for fab to meet the increasing demand? Do we add a third shift to our existing lines? Do we outsource the information? And so as part that business case, I had to work with marketing on the forecasted demand. I had to work with its supply chain and all of the different options of running a third shift or what would it cost to build out a new plant or and then also with R and D, I had to partner with them on what is the technology doing and how is it changing and how would that impact our decision, but when it came time to present the business case, once we had made our decision and we needed a substantial capital investment, we had to take it up several levels within the company. And it still sticks to me to this day that I remember sitting in this room with a bunch of senior leaders and I was probably the lowest level in the room as a financial analyst. And yet the group level CEO turned to me and asked point blank from my opinion on the option we had chosen versus the other two. And they, he did that because we're supposed to be that objective voice. I don't have you know, something at stake here with the different options that were chosen. I'm trying to look at them objectively and that is the role FP&A played. But I wouldn't have been able to answer his question on the spot like that if I hadn't been able to do all of the due diligence ahead of time in partnership with the other functions.  Mitch: (07:26)If everyone truly needs each other for a successful business strategy to be implemented, what are some of the biggest challenges in leveraging these relationships? Cross-functionally,  Debbie: (07:38)The biggest challenge I've ever seen has, has been around communication. If communication isn't spot on then you cause a lot of confusion. You have information that may be out of date that you're using, that a business partner may have updated. Deadlines could be changing and you're not aware of it. So to be effective communication really needs to be frequent and timely and, and understandable. And I'll start with the understandable. And by what I mean by that is if I'm using technical finance terms that my business partners are familiar with, then the chances are I'm not going to get the information I need to do my job because I'm not communicating effectively on what exactly the data is that I need or the information, and we won't be successful as a team. So the solve that from my point of view, it would be, you know, hosting a finance 101 being more descriptive when I'm asking for information such that, not speaking in technical finance terms and on the flip side, we need to make an effort to understand their language. So an example I would be, I would give is I'm currently working on this big a project right now to look at cloud computing and I'm working with the R&D product development people and our infrastructure team and it's very, very technical what we're looking at and there's not a day that goes by where there's 20 words. I have never heard before are not familiar or not and so I'm making an effort to go out there and, and Google them and look them up and make sure I understand what it is that they're talking about so that as the business case I'm helping put together takes form, that it's comprehensive enough to include all of the components that that need to be there. Otherwise we run the risk of coming up short in the amount of money we're asking for. Now, some of the things I can offer up to the listeners here is stuff I've put in place here at experience. So interestingly enough, my business partners that experience more all other finance folks. So I worked at the headquarters level and I interface with the finance people in the 10 business units and I interface with the, the London headquarters. Yeah, so it doesn't really matter though that these people are finance instead of R&D or marketing. But some of the ideas that we came up with to really improve communication is we send out a Monday morning email every Monday morning, someone on my staff sends out an email by 10:00 AM and it has, these are the deliverables for the week. This is who owns the deliverables and this is the date that it is due and who it is due to and we send it out regardless, every Monday by 10. So people know to expect it. And I have a backup on my staff so that if one person's out that Monday, it still gets sent. And if we, you know, by good fortune have nothing due that week, then we still send it out, you know, a nice big smiley face saying no deliverables this big. So nobody's left wondering, Oh, I didn't see that email and then tie to that email is a link to an internal finance website that we built up. And on that website they can find the calendar and the templates and everything that they need and gave to, can't reach one of us because we're often a meeting. So those are just some of the solutions that we've come up with to communication.  Mitch: (11:55)How about the communication over business drivers? How important is it for these cross functional teams to make sure they're on the same page and how does a strong cross functional leader actually play a role in achieving the organizational goals.  Debbie: (12:12)So it's extremely important that all members of a cross functional team understand the business drivers. Otherwise actions can be taken that have unintended consequences for the business. A good example that I've seen in my career is you will have a product that the company sells and the company also sells consumables that go with that product. So an example would be we sell a printer and we sell the ink. If we sell a medical device, a large capital equipment, and we sell the chemicals that are used in it. Now when your cross functional team is focused on the primary product and how many of those can we sell? But they don't understand that the business drivers or the profitability sit with the consumable. then the organization is focused potentially on the wrong issue especially if a supply chain issue comes up with the consumable and they're still pushing really hard on getting the product out and now all the sudden you've got a bunch of unhappy customers who don't have access to the consumables they need to run the equipment that they've purchased. So a strong cross functional leader helps the team maintain focus on all of the elements by identifying the critical business drivers and then the team we frequently review and discuss them.  Mitch: (13:50)Just to kind of close things out, what would be your prediction or you know, potentially a suggestion to the listeners on how to prepare for the future of relationships and cross functional leadership through FP&A? What are some best practices or last things to kind of take away from this conversation?  Debbie: (14:11)So, you know, I think having a open, holistic mind when working with your business partners, it's not always going to be about the numbers. You've got to be a true business partner that sees things from a bunch of different perspectives. And especially as technology is changing so rapidly, it's, it's understanding where is, where is your industry going? Whereas industries that are maybe 10 gentle to your and could have an impact and it's engaging in these conversations with your business partners so that as you're working with your business partners, it's not all about the tactical day to day issues that you're trying to address, but that you make time for, you know, these strategic conversations with your business partners. What are they worried about, what do they see coming up in the future and how can you be a true business partner to them and help solve for those issues together.  Announcer: (15:25)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Lorenzo Patelli:LinkedIn - https://www.linkedin.com/in/lorenzo-patelli-2abb518/University of Denver bio - https://daniels.du.edu/directory/lorenzo-patelli/Daniels College of Business: https://daniels.du.edu/Institute for Enterprise Ethics: https://daniels.du.edu/iee/FULL EPISODE TRANSCRIPTAdam: (00:00)Hey everybody. Thank you for listening to another episode of Count Me In. I'm Adam Larson sitting alongside Mitch Roshong and our expert guests for this episode is Lorenzo Patelli. Dr. Patelli, is an associate professor in the school of accountancy and interim director of the Institute for Enterprise Ethics in the Daniels College of Business at the University of Denver. He joined us on count me in to talk about the fascinating intersection of artificial intelligence and ethics. Mitch, can you tell us a little more about Dr. Patelli And his expertise in AI and ethics?  Mitch: (00:37)Sure, Adam. Lorenzo Patelli also serves on the editorial board of advances in management accounting and has received a number of awards and honors for his teaching excellence in research. He was recently a part of the elevate the ethics of artificial intelligence event at the University of Denver and regularly writes on the topic. Dr Patelli gives listeners a great overview of AI and tells us all why management accountants have the skills necessary to effectively manage the ethical implications of artificial intelligence. Let's go to the discussion.  Mitch: (01:08)Artificial intelligence is certainly becoming more pervasive in accounting and finance today. Can you please give us an overview of what exactly artificial intelligence is and what it can do for us?  Lorenzo: (01:26)Sure. Artificial intelligence is a field of computer science, particularly this field is concerned with empowering machines to think, behave and act like a han beings. In other words to make sure that machines have intelligence. Yeah. So several different technologies are developed to replicate the han senses and the ability to draw a conclusion or make judgments based on on the census. So for example, humans are able to talk and artificial intelligence develop develop speech recognition tools. Humans are able to move in artificial intelligence, develops motion planning tools through robotics, for example. Humans are able to see, and artificial intelligence develops computer regions. Humans are able to learn from experience. So artificial intelligence develops machine learning. So how does artificial intelligence and how does as computer science develop this technologies? They use different techniques, such as reinforcement learning. So machines learns from executing tasks and make mistakes and so for example, the LinkedIn notifications that we get from like a website like LinkedIn, a social network lately are based on reinforcement learning. So if we pay attention to this notifications or not it's something captured by the machine and it triggers a learning process. Another technique is deep learning and deep learning has to do with artificial neural networks that are meant to replicate the human brain. So there is one input and one output with multiple hidden layers in between in some advance search engines, are based on this technique. Then we have machine learning and the ability to learn from data without being programmed. So there is a training process where we give data to the machine and the machine is trained and that machine is capable of predict. So Google, Gmail or the automated responses that we, use, you know, or texting for example on our smart phones those are based on versions of machine learning. As I said, then we have computer visions and computer vision tools enable autonomous vehicles for example, to capture and understand the surrounding or facial recognition on our game and our phones and finally we have a natural language processes and with this machine so capable to understand and react to human language. So Alexa or Siri are technologies that we use base on NLP. So this, these all these techniques basically in this this methods are used by artificial intelligence to empower machine to examine a phenomenon and initiate a response based on the analysis of if not.  Mitch: (05:09)And with all of these capabilities, can you explain how AI has already started playing a role in accounting and finance?  Lorenzo: (05:15)Yes. well, specifically management accounting is the practice of judging organizational performance judging, meaning measuring, reporting and interpreting factors that indicate whether an organization is creating good destroying value. So at least in theory, artificial intelligence has and will have their remarkable impact on our profession. because exactly, we deal with analyzing a phenomenon and producing your response, judging it, but also practically, we know that in management accounting is practice relying on machines, databases and these machines nowadays deal with the large quantity of data in complex environments in which processes and products themselves will more and more run on artificial intelligence. So my view is that artificial intelligence will have a huge impact on accounting and finance. we know that companies that are already using some artificial intelligence techniques like bots and machine learning to enter data we know that bots are able to enter and categorize data you fully automated way. We know that something like reinforced learning is assisting companies in internal audit tasks to detect fraud and compliance issues. We know that companies are using language processing techniques to interpret contracts and we can even speculate further and imagine a performance measurement system completed a design based on metrics defined by machine learning techniques. We can again imagine initial iteration of budgets prepare through deep learning and we can envision performance reports and feedback processes, obtain through, language processing techniques. So the impact is going to be a significant and it's going to be a widespread in term of the type of companies who, which are going to be affected and the areas within the companies that are going to be affected.  Mitch: (07:45)Now I know another major component of accounting is ethics. So I'm just curious, in your opinion, how do we separate the opportunities from the threats of artificial intelligence when it comes to the ethical application and potentially the negative effects of artificial intelligence and machine learning?  Lorenzo: (08:05)Yeah, that's, that's a very, very important question and a strategic finance ad published few interesting pieces on this topic. As far as I see it it's important in first of all to have a framework to look at this issue. And I grew up the unintended consequences of AI in five major buckets. The first one is the impact on work we do know that professions are going to be disrupted and jobs would be lost and economies are actually debating whether artificial intelligence, different from technologists in the past are going to create jobs or destroy jobs primarily. So it's an interesting issue from an economic standpoint and it definitely poses some ethical considerations. The second bucket is inequality. I'm not the official intelligence as specific characteristic relative to a technological innovations of the past that it seems that it's going to benefit primarily some, not everyone. Like I talked earlier about the people that computers electricity to artificial intelligence. Well, electricity was beneficial for the overall population. And so we all benefited from the advancement of this technology. There are some concern, again, it's too early to conclude that artificial intelligence could be controlled and use for the benefits only of a few sections of the population. So that is another thing that we need to be careful about. It's the inequality that could be created by AI. The third bucket is the value transparency. We know very well that you use a jar or two. Digital intelligence are great decisions carry a great deal of biases and discriminatory elements. We all have read several instances on news about imperfect systems that simply replicated human biases, so that is another other area of concern. David Brooks you know, tutorial on the New York times warns about the ethical consequences of artificial intelligence. On the one hand he describes how we have important improvements in observing and preventing and dealing with very delicate problems like mental health issues such as depression and suicides. However David Brooks himself warns the non-transparent use of this data by states, for example, by government and employers. So value transparency is another area where we could see ethical dilemmas caused by artificial intelligence. The fourth bucket is data security and system integrity. so this is very close. It's very connected to management accounting because it has to do with data and there is a growing concern about the safety and security of running and storing data on technologies like blockchain and also the information sharing. So that's the fourth area that I identify a new area of ethical implication of AI. And lastly, I think community and social interaction. So artificial intelligence is going to have an effect on how we relate to each other and for example, the advanced of smart cities full of sensors capable of watching our behaviors constantly. that has also a social implication in which we can find ethical issues. However, I do believe that management accountants should not be scared by the challenge of distinguishing between opportunities and threats because it is our true competency to analyze risk and to measure risk. and so we have again, a great opportunity of contributing to the advancement of this technology, which is gonna affect various aspects of our lives.  MItch: (12:48)So as you referenced earlier, artificial intelligence, these bots, they begin to get smarter. Who is ultimately responsible for the decisions that are made by artificial intelligence?  Lorenzo: (13:02)Yeah. On this I have a more straightforward answer I guess, which is that the responsibility is also the human being. We cannot attribute responsibility to the machine or a delegate. We should say it responsibility to the machine. So the key is to build people meaning to hire, train and promote people that are competent and principle driven. I have always loved that the competency is the first ethical standard in the IMA statement of ethical professional practice. So management accountants should not withdraw from early discussion and strategic plans and the operational design processes that are ongoing within companies to develop and deploy AI technology. They should use this competency. They should use their competency and contribute to this conversation. So going back to artificial intelligence now if in the past human being succeeded by being a great performance and mostly beating the machine by performing tasks, artificial intelligence I think requires hans to be great persons, meaning we need to rediscover and re-emphasize what makes us unique. And I think what makes us unique as han being is the sense of values. The ability to separate the good and bad, the right and the wrong, the beautiful and the ugly. The Just and the unjust. These is what makes us uniquely human. therefore, to wrap up the answer to your question two pillars. One, the competency that we need to use and contribute with, and the new competency framework for example, of the IMA goes into this direction when it emphasizes technology and analytical skills. and the second pillar, which is strong foundation in professional ethics and values. These two pillars are the key, in my opinion, to enhance the responsibility, which remains, in the hands and of human beings.  Mitch: (15:20)So now I'm curious, I'm going to kind of combine two different questions here, but with artificial intelligence, do you believe then there should be some limitations in the capacity that they are used and whether it's yes or no. Do you believe there should be some kind of governing body or oversight body that will set standards for who can use artificial intelligence and how it is used?  Lorenzo: (15:46)Yes, this is a very important question and unfortunately the answer is not an easy one and I suspect many attempts will be made and we will inevitably make mistakes and failure and we will fail and we will implement some sort of corrective actions. I am director of the Institute for Enterprise Ethics at the University of Denver and we recently hosted a panel discussion on the ethical implications of AI. I was very surprised by the fact that two two of the panelists were CEOs of startups that are completely based on the development of artificial intelligence two different technologies, two different services. But two companies completely dependent on artificial intelligence. And I was there surprised it said that they both advocated for more regulation on the usage of AI. And I asked myself why, you know, CEOs of startup are so described oftentimes as disruptors and rule adverse you know, people that think beyond the preconceived models sit down on necessarily like regulation. The truth is that in the conversation, what became apparent is that they need framework to operate. They expose themselves to a lot of race and by using this technologies and they welcome a more direction and more regulation, however, I think that the truth as exactly, economists argue it's not so much in preventing all kinds of risks, but what I hold dear is to prevent inequality, more inequality generated by this artificial intelligence. So I think on this, the government could definitely play a role to make sure that we all benefits from these technological innovation. So not just regulation for the sake of regulation, but maybe regulations, my regulation that allows more transparency and more information sharing that would benefit the advancement of this technology for all sections of the population. So it's important to discuss the purpose of this regulation. And then I think the board of directors have a incredibly important role in making sure that organizations are concerned about the ethical implications of AI and they put in place systems and, and how foster cultures we, the in private organization or, or public organization where there is a sensitivity to these issues. So we do have information about positive trends, in this sense. The wall street journal just reported that a venture capital incubators have initiated important changes within start ups is important. Changes are promoting code of ethics that guide artificial intelligence, startups, operations tools to explain how a teacher of intelligence make decisions. And lastly, best practices to communicate and gather feedback about artificial intelligence output. So we see that there is a growing awareness of the importance of getting the board involved in this conversation.  Announcer: (19:25)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Amy:LinkedIn - https://www.linkedin.com/in/amyvettercpa/Facebook, Twitter, and Instagram - @amyvettercpaEmail - info@amyvetter.comhttp://www.amyvetter.comDisconnect to Connect: The Path to Work-Life Harmony: https://www.youtube.com/watch?v=c1WYlK-gUME#action=share Breaking Beliefs Podcast: https://www.amyvetter.com/breakingbeliefspodcastFULL EPISODE TRANSCRIPTMitch: (00:03)Welcome back to Count Me In, IMA's podcast about all things affecting the accounting and finance world. Make sure you send us an email and let us know what questions you'd like our experts to answer so we can continue providing you with the information you need to advance your career. One of the biggest questions, not just in accounting but across the business world, is about technology. I'm your host Mitch Roshong and I'm joined by my cohost, Adam Larson, who spoke with Amy Vetter about the impact of technology and how it can be used to create a better work life balance. Amy is the CEO of the B3 method Institute and a professional keynote speaker on being mindful with technology disruption and this episode, Amy shares her mindful leadership strategies and discusses the importance of implementing technology the right way. Adam, what is Amy's business balance and bliss all about?  Adam: (00:57)Great question, Mitch. Amy's whole message is that you can transform your career and your life by being mindful with technology and utilizing successful leadership strategies. In our conversations, she emphasizes the importance of leading by example and engaging in the process, not trying to be perfect all the time and allowing individuals to be innovative to maximize the team's potential. As an award winning accomplished C level executive and board member, Amy strives to inspire a culture of mindfulness when utilizing technology and in an environment of innovation and collaboration. Let's listen to how we can create a better work life balance.  Adam: (01:34)How can technology be used properly to not only improve business efficiencies, but also create a better work life balance?  Amy: (01:47)When you're thinking about putting technology in place, it's important to step back from the whole process of digital automation and understand what your goals are. Because many people just go about where they hear about a certain software or are trying to rush ahead in technology implementation and don't really understand the why behind what they're doing and why they're putting it into their business. So first off, it's really important to understand why you want to put certain communication tools in your business. And so when you talk about technology, that could be a distraction that can be where we set up instant messaging And then there's email and then there's some people use like Microsoft teams or Slack for communication as well as just our regular texting and phone call and people walking into offices. And the thing is when we're putting all this technology in place, if we don't start thinking about the human experience as we're going through the implementation, we can actually create more stress rather than less. So think about what you were using each of those technologies for. So if you're trying to put in communication tools so that people a can easily communicate no matter where they are, if they're remote, different geographic locations and so forth, make sure to define what each is used for. So if it's a Slack or Microsoft teams, what kind of communication are you doing in there versus instant messaging versus email versus texting? Because what you don't want to happen is someone in the workplace feeling like they don't know which one you're checking. So now they have to send four different messages to four different places. So that they catch you, which then creates more stress for everybody because then you're checking all of those things. Now when we talk about work life balance with technology, if implemented correctly, it really can create that freedoms so that you can be doing what you need to do personally or with your family because you have the right technology in place and because you've put parameters around that technology as well. But it's also again, putting guardrails around how communication happens. So I'll give you an example, you know, I'm a CPA and when I was a CPA firm partner, you know, you're working a ton of hours. And what would happen in my day is I was out at clients all day long and then I'd get home, do dinner and spend time with the kids and then I'd start working again and get my own work done. So that might start at eight o'clock at night. And what I didn't realize was when I was sending emails at eight o'clock at night, I was stressing out my staff and the people around me because they thought, which I didn't realize at the time that they needed to respond to me at eight o'clock at night and I never had that intention. But again, this is where the human side needs to coincide with technology where one day I heard the staff making a joke about the eight o'clock emails. Then I went over to them and said, are you talking about the emails that I send? And they said, yeah, and I said, so you realize I don't expect you to answer those emails at eight o'clock at night. And they were feeling the stress that they needed to. That was just the time I could work. Now the way technology is set up today, if we use properly, if you are doing your work at eight o'clock at night, you can set it and schedule those emails to go out in the morning so that you aren't creating an experience for someone else that could be stressful even if it's unintentional. But use the technology so that everyone's got their guard rails between work and home life and their personal life. And you set up the technology with the parameters around communication and how you work so that everyone has the freedom to get away from work when they need to.  Adam: (06:32)So then how should people view technology? Should there be different goals for learning new technologies in your career versus in your personal life?  Amy: (06:41)Technology is definitely not going to go away. So the truth is that whatever we learn today is going to continue to change. What used to happen in our businesses was we'd select software and that would be good for 20 years or so. But now this is a constant learning process and we really need to be open to just the play of it and being innovative with it to find out where it can help us in our career, but also in our personal life, make things more efficient. I can use an example. You know, my oldest son just went to college and you know, experiencing my son moving out was definitely an emotional time. But then in my personal life was able to discover this app called Marco polo. And we got on as a family and it's video messaging between each other. And so at anytime, even if we can't connect on the phone or all available at the same time, we're having a personal connection through these video messages that have actually been pretty hilarious. But I'm also seeing the new things he's doing as well. And that's what I mean about play, that this doesn't always have to be so serious. This is about how do you utilize this technology to enhance your career and your life and make sure you're having fun with it and also creating new ideas and services and ways that you can communicate with other people because of the technology enhancing the human experience, not replacing it.  Adam: (08:26)You've already talked about when you're implementing new technologies, it's good to have, you know, some sort of goal set up, like whether it's Slack or instant messaging. So what role does the effective leader play or have in managing an individual's technology use and maximizing teams' potential? You know, keeping in mind the fact that you said it's good for them to play. So how do you balance that and how do you manage that?  Amy: (08:49)Okay. Yeah. So I think it's important as a leader that, and the effective leaders that I have worked with have always been very open and their communication and realizing that it's not just their way or the highway, that they're listening to the ideas of everyone around us. So the problem is as we become leaders, less and less feedback comes at us, right? Because we get in a position of authority where people are fearful to give feedback to us. If we really wanted implement technology in the right way, it can't just be our ideas going into the technology implementation. We actually need to take feedback from everybody and understand their experience and the things that they're fearful of as well with the technology so that we develop goals for each person that will help enhance them. So if they're afraid that when you implement a certain piece of technology that it can make their job obsolete or they're not convinced it could be better than what they were doing before manually. It's our work as a leader to meet with each person individually, understand what is holding them back and what type of activities, education, ways to support them so that they can be successful.  Adam: (10:26)So we've talked about all these benefits from technology, but I see that you gave a presentation on disconnect to connect, you know, what does that mean and how can it be applied to the accounting and finance professionals who will be listening to this podcast?  Amy: (10:39)Sure. So I've really, you know, coming back to the mindfulness side, you know, through all the work that I've done with businesses over the years of helping them with technology, implementation, disruption and change management. One thing that I've noticed is that it's not the technology that gets in the way. It's not the actual change that gets in the way or learning about that because we all have the capability to do that. What gets in the way. Our own internal patterns and habits and stories that we could have developed from childhood or belief systems that came from outside of us that other coworkers have said to us or bosses have said to us that become a belief system internally. But we never really step back and truly disconnect from what is going on in our lives to connect to who we are internally and understand what are those belief systems that are driving us and why and do we actually even them. Part of this is that because we're in such a rush to keep up and to keep up with all the deadlines of the work that we're doing, but also keep up to the pace of change, we often don't make time to step back and pause and make sure that we're really present in the experience and we're doing what we want to be doing and thinking forward that, you know, there's value in the things we're doing today for the future of our work and why? So if we don't take that time to disconnect, it's hard for us to connect to, you know, what our personal purposes in life, like why we do what we do, what it's not just about the business outcomes, but also making sure that we feel fulfilled by the work that we're doing today. But also what the impact that we could have tomorrow as well. And the reason I say disconnect to connect because a lot of times we may feel like when we take time for ourselves to really do this self discovery, we may feel guilty for taking that time for ourselves or that we feel like we should be doing something else. That's the way our brains work instead of thinking of it as selfish. It's really about that when we are better connected to ourselves and to our purpose, then when we connect better to the people that we work with, to the people in our personal lives as well. Because we're more about being in the present moment cause we understand where we're going in the future, when we allow technology to distract us when we are meeting with somebody else. Whether it be someone in business, whether it be someone in our personal lives, and we keep telling that person in that conversation, just hold on a second. Let me check that email or let me check that text whether we intend to or not. We're actually creating experience where that person may feel like they're not important, even though that's not our intention. These are the moments to remind ourselves that we want to be present because if we miss someone's body language or the little feelings or emotions that might come up in the way that they're saying things because we are distracted, we can also miss some of the best business opportunities or the best ways to connect with somebody around us that will benefit our relationships into the future. So that's really what disconnecting to connect is all about, is taking that time for yourself, going on that journey so that you can connect better to the world around you and succeed as you go into the future.  Announcer: (14:54)This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA'S website at www.imanet.org.

IMA's Commitment to Diversity & Inclusion: https://www.imanet.org/about-ima/diversity-and-inclusionFULL EPISODE TRANSCRIPTAdam: (00:03)Welcome back for another special bonus episode of Count Me In. I'm your host, Adam Larson, and I'm joined by my cohost Mitch Roshong. Today you will be hearing the second installment of our IMA focused mini series as we highlight IMA's commitment to diversity and inclusion. Fundamental to our core values, IMA is committed to creating and nurturing a diverse and inclusive member community and accounting and finance profession to foster mutual respect between individuals. To further explain this commitment, Mitch sat down with IMA's, director of diversity and inclusion, Linda Devonish Mills. Mitch, what did you take away from the conversation?  Mitch: (00:44)IMA embraces a culture of open-mindedness and encourages multiple perspectives to enhance our collaborative solutions, drive innovation, and create and deliver value in all that we do. Linda is the staff member who steers this education and outreach through various initiatives. In our conversation, Linda talks about her role at IMA, emphasizes the importance of D&I and provides implementation strategies for other organizations to adopt diversity and inclusion practices. Let's listen now.  Mitch: (01:13)So the director of diversity and inclusion at IMA. Can you please explain to us how your role came about and some of the different initiatives you're working on at IMA?  Linda: (01:30)Sure. So this is a prime example as to how someone can just manage or control their career. Where at the time I was officially a IMA's director of technical accounting activities. And in that role, I just took it upon myself to go beyond that role and just look at the environment of IMA in general where I don't feel uncomfortable saying this since our president and CEO has said that when we attend our annual conferences, for example, of many years ago, it's gotten better over the years. But when I first started my career here in may of 2006, the audience at our conference is much different than it is today. And back then I would say the best way to describe it is that it was a predominantly white males that were coming to our conference. And with me being an accounting professional all throughout my career, I knew that wasn't a good representation of our profession. So during my years, again as director of technical accounting activities, I took it upon myself with the support of the leaders at the time that I was reporting to, to do outreach to students at diverse student populations, you know, at colleges or universities that have diverse student populations, specifically you emphasis with historically black colleges and universities. Because as I started going to those schools the faculty members at those schools were but informed me that they didn't have a problem with attracting students at those schools. The more of the challenge is maintaining them or encouraging them to stay within their major thinking that it was so challenging and they may not have a chance to have careers in that field. So it seems like you know, the leaders here at IMA really appreciated my efforts and thought that a better fit for both me and IMA is to focus about around diversity and inclusion initiatives more so on a full time basis. And here I am today since July 1st of 2018 being an IMA's director of diversity and inclusion. And since then, you know, I've just developed my own path with that particular position. So a lot of the initiatives that fall under that umbrella is education. For example, with IMA being a membership organization, you have to provide education not only for staff but for our members as well. So we've done training on, you know, various D&I topics recently specifically has to be laid to unconscious bias. You know, we have a great course under our Leadership Academy catalog called cultivating a bias free workplace and we use that as a product both for staff and members as relates to training in that area. I'm still doing an outreach where I'm going out next week to Savannah, Georgia to some of the historically black colleges and universities in that area. And other areas is the diversification of a leadership pipeline, both as relates to staff and all volunteers and then also just best practices determining what other organizations are doing as it relates to a diversity and inclusion initiative.  Mitch: (05:16)That's great. Following all these different initiatives and a lot of your personal outreach what do you think is the true value of diversity and inclusion? Why is this important? Why are you so passionate about accomplishing your own personal goals?  Linda: (05:30)Right? So you hit it, you framed the question very well that this is clearly coming from my own personal passion. What's interesting and I'm so honored that I'm in this role because this is like the most exciting role in my career. Despite the fact that I don't consider myself an expert in the area, I'm still going through a learning curve in terms of how this position should play out. But the reason why I know I will be successful with it is because it relates to my personal passion. I can, you know, speak to it, you know, very directly, just based on when we talk about unconscious bias or conscious bias. I've experienced it all throughout my career, you know, so I know specifically how to apply it. and how I would like you know, a workplace to look like as it relates to diversity and inclusion. So in terms of value what I would suggest to other organizations, or what we have to keep in mind here is that no successful initiative with diversity is successful if you don't include the component of inclusion. So when I think about diversity and inclusion together, I think of transparency so you know, I just saw a quote recently about how diversity and inclusion should integrate together. And it said diversity is when you're invited to the party and inclusion is when you're asked to dance. And I thought that was a great correlation, you know, of the two just recently among our staff when we had trained in use India leadership academies, a course about developing a bias free workplace that was a great milestone for me and shared with you Mitch that you know, we actually saw staff, at least my observation was, is that there was staff that actually spoke up during that session that I've never seen in any other type of forum speak up. And I think it's because they, you know, based on what they do here at IMA, they may not think that they're at a level or maybe based on their title, they don't feel like they can or should be heard. But I was very fascinated that it seems like the, the walls just, there was no walls there and people just opened up and you know, when I see that type of environment development developing within an organization, that to me is you know, signs of success.  Mitch: (08:22)So I think that's a great point because, you know, personally witnessing the training session that we had obviously there were very positive results coming from that. So I'm just curious, you know, as awareness increases in our organization and the other organizations that you reach out to what kind of positive results have you seen elsewhere maybe outside of our own building here?  Linda: (08:47)Well, actually I just been appointed to serve on behalf of IMA the organization called the American society of association executives more famously known as ASAE and they have a national diversity and inclusion committee. So I've been honored to be appointed and serve on behalf of IMA to represent IMA with that committee. And even before I was appointed to the committee, it seems like the word is spreading around of IMA being an organization that takes diversity and inclusion seriously. So one of the editors of ASAE's newsletter reached out to me and Giuseppe Barone, who was our public relations manager to write an article about how IMA has benefited from strategic partnerships that ties into our initiatives. So we have strategic partnerships with the national association of black accountants. For example, we have a partnership with the associations of Latino professionals for America. And then we also established a relationship as a sponsor for a program called the PhD project, which is a project that provides support to minority doctoral candidates. So I'm also very proud of that also that we're slowly but surely being recognized in an organization that has best practices so to speak. And people are asking us, you know, how we have developed our initiative.  Mitch: (10:32)That's a perfect segue also. so as you know, you're kind of leading the initiative on behalf of IMA and reaching a number of well established organizations for listeners and other organizations who may not have an affiliation with IMA, what kind of strategies would you recommend for them to implement their own D&I practices?  Linda: (10:52)Right, so I think what they have to do is to look at the organization's focus. Their strategy, probably one of the first steps they would have to take is since most organizations, again their stakeholders are primarily staff and not so much volunteers. So I would say to take a, like an easier makeup of an organization. Let's take for example, an organization that just focuses more on staff. One of the first things they may want to do is have like an employee survey and get input from their employees in terms of what diversity and inclusion looks, you know, it looks like to them in terms of what they would be looking for in a workplace. What type of training that they would want to be involved in. You know I think the worst thing an organization can do is to take it upon themselves, especially in this area to determine a certain training methodology. And it's so far off the Mark from what staff is really looking for. So I would think that would be the first step because maybe based on the feedback they get from employees, you know, who knows, they may incorporate more events, you know, within an organization that would appeal to employees. affinity groups depending on how diverse the staff is within an organization that may apply or may be applicable. So I just think that an organization would have to do their homework not only internally but externally to again, look at what other organizations are doing in this space and see what practices would work for their organization.  Announcer: (12:51)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

FULL EPISODE TRANSCRIPTMitch: (00:03)We are back with another episode of Count Me In, IMA’s podcast about all things affecting the accounting and finance world. This is Mitch Roshong as your host and I'm joined by my cohost Adam Larson. We are now over 20 episodes into our podcast series and we would love to hear from you drop us a line or write us a review and let us know what you think about the accounting and finance topics we've discussed so far for today's episode. I personally think the topic is very interesting and I'm especially excited to share this episode because we were fortunate enough to be joined by Dr. Paul Juras. Adam, tell us a little bit about Paul and what you learned about the topic of industry 4.0. Adam: (00:47)Dr. Paul Juras is chair elect of IMA's global board of directors and serves on other committees for the Institute of Management Accountants. He is a certified management accountant, a CPA, and uses his expertise in strategic management accounting to teach as the Vander Wolk Professor of Managerial Accounting and Operational Performance at Babson College. He joined Count Me In to give us an overview of industry 4.0 and explain why accounting and finance professionals can benefit from learning more about its principles. I learned how industry 4.0 is going beyond just the manufacturing industry and a number of other relevant points. Let's make sure you're accounted in for all these learnings too and jump ahead into the conversation now  Adam: (01:28)Since industry 4.0 may still be considered a relatively new topic, can you give us an overview of the topic and let us know what makes it so special?  Paul: (01:43)Sure. In fact, it was not that long ago that I first heard about this topic. I came across it as part of my research and quickly realized the implications could be huge for our profession. Industry 4.0 also called I4.0 is a complex and fast evolving topic, but at the most basic level, the term refers to the combination of several major innovations in digital technology all coming to maturity right now and all poised to transform industries. The technologies include advanced robotics and artificial intelligence, sophisticated and low cost sensors, cloud computing, he internet of things, data capture and analytics, digital fabrication including 3D printing, smart phones and other mobile devices and the list goes on. These technologies are often thought of separately, but industry 4.0 is all about connectivity and that's what makes it so special. When the technologies are joined together, they integrate the physical and virtual worlds, which has led many to call this the fourth industrial revolution. The changes that are taking place enables a powerful new way of organizing global operations and smart technologies will likely redefine industry and operating models. I4.0 Might also be called smart manufacturing because of the expectation of complete visibility of manufacturing processes and the possibility of continuous process improvements using the big data collected throughout production lines. The end result could be increased production flexibility and efficiency improvements that drive down costs and reduced the time to market and we're seeing companies transform themselves through the emergence of new business models such as software as a service or equipment as a service. One examples is GEs power by the hour model or does selling us engines? Much as utility company might sell to a residence or commercial enterprise. GE sells the capabilities of its engines for some price per operating hour and the customer pays only when the plane is flying. Now, I don't know what are the transformations we are likely to see, but I know accounting and finance professionals could play a role in helping organizations through their transformation.  Adam: (03:53)You mentioned that I 4.0 has been called the fourth industrial revolution or smart manufacturing and the example with GE is interesting. Is manufacturing going to be the main industry affected by this revolution?  Paul: (04:05)A fair question and manufacturing was the original focus. Industry 4.0 is the name given to the German strategic initiative to establish Germany as a lead market and provider of advanced manufacturing solutions, but the concept has evolved and many companies have been adopting the industry 4.0 concepts and adapting them to work within their own industries. There's already been wide adoption of industry 4.0 technologies in farming. Farmers are using sensors to monitor soil conditions to determine when to water, how much to water and what fertilizers might be needed. They're using drones to monitor the crops to help determine which part of a field is ready for harvest and may be even do targeted applications of insecticides or fertilizers. Those are just a few examples of technology helping farmers grow more with less as part of what is called agriculture 4.0. There've been advances to build smart grids, managed renewable energy and distributed generation all as part of energy 4.0 we have retail 4.0 healthcare 4.0 pharma 4.0 and many other 4.0's it is hard to imagine an industry that will not be affected by or take advantage of industry 4.0 implementation. We might say we will be living in a 4.0 world.  Adam: (05:22)So what about the accounting industry? What do our accounting and finance professionals need to know?  Paul: (05:28)Looking at globally, we see a growing pressure to move ideas into tangible products in a shorter period of time with increasing levels of customization, quality and performance, all will maintaining acceptable margins. Well delivering goods and services that for more demanding customers want and doing so at a cost that preserves margins is increasingly difficult and can no longer be done by simply doing more. Let's face it, new ways of connecting people with products and products with each other will continue to emerge and all this connectivity will be providing organizations with an ocean of data. The increase connectivity may open ways to improve asset utilization or create new ways to monetize the company's assets. These are examples of the promise of leveraging big data and advanced analytics to make better decisions and take better actions, but you need to avoid analysis paralysis. What that means is that more data is not always better. The key will be effectively managing big data sources and the related analysis of that data. I view all of this change as a technology tidal wave, a tidal wave that will further drive the need for transformation. These transformations will come with opportunities, but also with related challenges, Opportunities and challenges that need to be identified and understood. Individuals who understand the implications of these emerging technologies and their potential impact on the organization can help navigate this coming see of change. Now consider the technology and analytics and the business acumen and operations domains of the IMA's managemnt accounting competency framework. These domains include the competencies required to manage technology and analyze data within an industry specific context and with the operational knowledge to envision the opportunities to capture value. These competencies seem perfectly aligned with the needs of companies that will go through and I 4.0 transformation.  Adam: (07:24)How about outside of just technology though? Are there connections to the other domains?  Paul: (07:28)Most definitely organizations will need to prioritize innovation and strategic investment or risk losing competitive advantage. The skills to perform these tasks connects high 4.0 to the strategy planning and performance domain. All the connectivity will provide detailed data that will allow us to connect financial information to the operational activities that generate that information. The data could be used to improve the accuracy of the cost of production. Now imagine being able to track the effect of a customer specific requirements on the resources of the logistics function. The data now could be used not only to improve the accuracy of the calculations of the cost of products, but can improve the calculation of customer profitability. The results could be analyzed to make recommendations about pricing, whether to even keep the customer. These examples utilize skills from the reporting and control domain. And speaking of data, how will all of this data be used and will any of it be shared? These are just two of the ethical questions that connect I 4.0 adoption to the professional ethics and values domain. And let's not overlook the fact that these transformations will necessitate collaboration with internal and external stake holders in order to capture the most value. Any new implementation effort will require the communication of a clear vision and explanation of the opportunities and challenges. And what we're talking about here is change. So change management skills for successful industry 4.0 on implementation will be required. Collaboration, communication and change management skills, all part of the leadership domain, the competency framework.  Adam: (09:03)Do you have any final remarks you'd like to share about industry 4.0 what can we expect from it in the future?  Paul: (09:09)Digital disruption is accelerating and it's anticipated to impact all industries to varying degrees. So we all need to be prepared for a 4.0 world. Although the advantages I 4.0 offers are many implementations will come with its own set of challenges. Challenges that need to be identified, understood and addressed in future podcasts. We help provide insights into these challenges such as developing a business case for I 4.0 or the data issues that will permeate high 4.0 adoption.  Announcer: (09:41)This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in from more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Sandy:LinkedIn - https://www.linkedin.com/in/sandra-richtermeyer-6b62083/Twitter - @SRichtermeyer UMass-Lowell Manning School of Business: https://www.uml.edu/msb/FULL EPISODE TRANSCRIPTMusic: (00:00) Mitch: (00:04)Welcome back for Episode 20 of Count Me In! Mitch Roshong and Adam Larson from IMA here with you to pass along industry knowledge and the latest perspectives on management accounting. Our expert guest speaker for today's episode has over 20 years of experience as a board member more than 14 years of academic leadership experience and is extremely well versed in presenting on key accounting topics for our conversation. Adam spoke with Dr.. Sandy Richtermeyer on the importance of enterprise risk management.  Adam: (00:36)That's right, Mitch. Sandy is the Dean of the Manning school of business of the university of Massachusetts Lowell. She's previously served as chair of IMA's global board of directors and represented IMA on the COSO board where she served on the committee that updated the COSO internal control integrated framework and the COSO enterprise risk management framework. She is truly committed to organizations achieving excellence through good governance and effective risk management. In this episode, Sandy talks about why organizations should align their mission and vision to create a culture that embraces the tone at the top and enables successful strategic execution through enterprise risk management. Now, here is episode 20 of count me in with Dr. Sandy Richtermeyer. Adam: (01:24)What advice do you have for organizations seeking to align their mission, vision, and core values with effective risk management programs?  Sandy: (01:32)Sometimes when we think about a mission, vision, and core values or as an organization is preparing to to become more risk, mature or refined, or maybe they're just getting started in their risk management program. So I like to give them like three practical exercises, three things that they can work on or think about. Usually you start to set the tone for looking at risk management in a different way. So one of them, one exercise that I ask them to do is to do a mission check. And I think it's good for an organization to do a mission check every three to five years just to make sure their mission statement, mission of their organization is still truly in line with who they want to be. And then after they do that mission check and maybe they make some changes to it or maybe the mission statement that they have in places is working great for them. Then I asked them what top three risks could cause you to fail in your mission? And this is usually a pretty good exercise because oftentimes you get a lot of variance on the responses. But I think by you know, having organization leaders you know, come up with just three, only three top risks that could cause them to fail and then be in alignment on there on those top three risks that could cause their mission to fail can be a very, helpful exercise. And it's one that really sets the tone for what you need to do, you know, down the road as you move through the risk management process. So that's the first exercise I usually ask them to do. And then the second is to evaluate their vision statement and see if that vision statement that they have or sometimes they don't even have one or they confuse it with the mission statement. But usually larger organizations have a vision statement, but ask them to see if this vision statement is a good fit for their ideas on how they want to create, preserve and enhance value. What are they trying to accomplish and how does that vision statement, describe that. And then I asked them to describe what risks could cause them to not achieve their vision. This is where it's also important to bring in the concept of having them think about risks that bring in new opportunities and risks that they want to avoid or mitigate. So the vision statement piece and associated risks is very helpful for them to think about. And then the third exercise we move into evaluating core values. And that's hoping that they have clearly articulated core values. Sometimes an organization might say, well we haven't really, you know, clearly defined our core values. And so this is a great opportunity before they get too far into the risk management process for them to take a step back and really look at their core values. And maybe they have them in place or they create them. But if they say they have core values in place that they've, that they've articulated before or they're that or that they've articulated previously to starting on their risk management journey, then we ask are the core values specific enough to speak to the value creation that they hope to achieve? Are these core values? Are the core values that they have enablers of a good culture? Do they set the tone for a culture that will allow the organization to achieve its strategic goals and achieve its desired performance? Again, these generic or vague values might not bring about a culture that's needed to reach strategic goals and objectives and ultimately strong performance. So it's good to take a pause and do this values check. So I think these three exercises, one is a mission check to evaluate a vision statement. Three, evaluate core values or create a vision statement and create core values. Those are activities that I think can really become very effective and useful that set the right foundation for risk management.  Adam: (05:43)All right. So we've talked about an organization's mission and their vision and how important those are focusing on your risk management program. But what role does the organizational culture play in risk management and then who is responsible for establishing that culture?  Sandy: (05:56)Sometimes an organization wants to do everything or organizational leaders want to do everything they can to improve the culture and and help establish the culture that will embrace risk management and all that that entails. They focus on how can they instill more transparency and risk awareness into the culture. Because oftentimes if you look at where does some really core problems exist in organizational culture, very often it has to do with lack of transparency. People don't feel like they know what's going on, they're not aware, they feel like they are on a need to know basis, that type of thing. And they also may not be even remotely aware of the key risks of the organizational faces. So how do you get people to understand or how do you, how do you improve transparency or how do you build a risk aware culture that will be very useful in terms of implementing risk management? Well, what I've seen organizations do is sometimes they they work on ways to encourage people in the organization to, bring up issues of concern to have maybe like, I don't know, for lack of a better example, maybe a suggestion box or maybe it's a way to voice concerns either anonymously or yeah, not anonymously, but basically encouraging people both to talk about key issues of concerns and make sure that when they do that that, that you can help them not have fear of retribution because oftentimes people are reluctant to bring up challenges or concerns or issues that they see because they feel that it's going to come back at them. And so as you find ways to transparently have, you know, maybe a for maybe it's an open for maybe it's an open discussion, ways that you can talk about challenges and concerns in a transparent, open matter manner. And make sure that people feel comfortable in that in discussing their concerns. That can be very helpful. Now that can be hard to do and sometimes it takes organizations, a few tries to get that right but that can be very helpful in terms of you know, elevating a culture and making it more positive and ready to embrace, you know, risk management and, and other strategic goals with the organization. Maybe trying to improve or work on. So again, improving transparency, finding ways to share information, making sure that people understand that they can bring up concerns or opportunity or bring up concerns or new ideas that can be received in a positive way or that they feel that they're able to positively contribute. Another way that I've seen organizations improve their culture and very much helped prepare them for risk management practices is to talk about, you know, if they have a core value statement, to give examples of when that core value statement is alive and kicking. You know, when is it working? Well, maybe an employee does something that, is something that improves customer service and perhaps there's a customer focused values that's very important to the organization. When someone does something in alignment with core values, is that, how do they call that out? How do they talk about that great behavior and share that example and talk about the positive side of how when we embrace our core values, how it affects our culture and it becomes contagious. People want to follow, they want to be part of that and that, and if it's done in a very positive way, that can be very helpful. So, you know, how does that get implemented? Well, senior management needs to buy into that management at different levels of the organization need to think about how they can promote the culture given where they sit in the organization. you know, a large organizations can have a lot of complexities because there can be subcultures and departments or in different areas of the organization. But as leaders at any level, the organization learn how to embrace and Dr.aw out the good, the good things that are happening, the things that are aligned with the culture, talk about them, share them in a very transparent and open way. It can have a dramatic impact on organizational culture.  Adam: (10:34)How do accountants compliment the implementation of a risk management program?  Sandy: (10:39)Well, I think the skills and the mindset of accounting and finance professionals are so incredibly important to effective implementation of risk management. When I think about what, you know, management accounting professionals or accounting finance professionals bring to the table. They bring to the table knowledge of obviously reporting on performance gathering information. I think about information flow. How does information flow through the organization? How has it integrated through the organization and how does internal control affect the ability for information to flow through and be helpful? And as they're working on decision support, planning, control activities, those types of things. I'm also hopefully being heavily involved with strategic planning and objective settings. Their skillsets, their ability to synthesize, organize, and communicate with clarity. The issues that are so important to consider with risk management. It's, it's very important to have them involved. In terms of their skillset, I believe that accounting and finance professionals have so much to offer to an organization as they look at deploying risk management and maybe moving from a risk immature organization to a risk mature organization. And when I think about the skill sets that that accounting and finance professionals have I really like to reference the IMA's management accounting competency framework because I think that it's so inclusive. It has all the key elements of what a solid finance and accounting professional should, that they are engaged in, that they should be aware of and knowledgeable of. I think about the, the core foundations of that that revolve around planning and reporting decision making, technology and operations. I mean, if I just start with the planning and reporting aspect, that's so important too. A big part of risk management, particularly right in the right after you think about mission, vision and core values, you know, you move into them to strategy development and the management accounting professionals ability to be at the table while a strategy or strategic planning is happening while it's being conducted. While they're thinking about what is the proposed strategy going to look like? What's involved with that? What resources are needed? How does this impact organizational operations? Those things are so important. And I think that having the input of accounting and finance professionals in those stages of strategic planning and development is absolutely key because in that strategic planning and development session or in that, during that stage you have to be thinking about what are the risks that could impact the organization? What risks what risks are possible, what could cause an organization to not achieve its strategic goals and objectives, to not meet its strategic plan or not to not be able to execute a strategic plan? What could occur that throws an organization off track with its strategy? And that's where risk management is absolutely essential. So in the management accounting competency framework the technology piece is highlighted is very important and many organizations cite that their number one risk that they face or that they feel most uncertain about is technology risk. Whether it's a loss of data, whether it's, you know, ERP downtime or system downtime or theft of data. All different types of things come into play there. And I think that having management accounting professionals, our accounting and finance professionals who are well versed in technology and a technology enablement of key processes in the organization, it can be very, it's very important and very helpful with regards to implementing an effective risk management strategy. Okay. So another way that accounting and finance professionals use their skills and can contribute greatly to enterprise risk management is in their knowledge of performance assessment. So the third component in the COSO erm framework, his performance. Performances is right in the middle of the framework and it's very important to effective effective risk management. Part of that is identifying risks, what organizational risks exist, how can we identify and capture all of these key risks for the organization and the skillset of an accounting and finance professional are very helpful, however, because they can help collect, synthesize and aggregate the information for other key players in the ERM process to evaluate and as they look at each key risk, there needs to be some type of assessment that shows how does that risk affect the performance of the organizational strategy and the business objectives. So the impact on performance is key because in terms of sorting through risks and determining what we're going to focus on, what's the most important? The impact on performance is key. So that risk identification process is, is critical and it's incredibly helpful to have accounting and finance professionals involved with that.  Announcer: (16:36)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in from more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Ben Wann:LinkedIn - https://www.linkedin.com/in/ben-wann/The Numbers Guys: https://www.the-numbers-guys.com/ https://numbersguys.glideapp.io/ https://www.youtube.com/channel/UCAcYwylNFH3iz98JIH94n7A FULL EPISODE TRANSCRIPTMusic: (00:00) Mitch: (00:05) Hey everyone. Thanks for joining us again on Count Me In. I am Mitch Roshong and my cohost is Adam Larson. Our guest for today's episode is Ben Wann. Ben is a CMA, MBA and CPA and is currently pursuing his CSCA specialty credential. He is an operational finance leader and a finance business partner who came to talk to us at IMA about the future of finance. Adam, you interviewed Ben for this episode. Give us a quick preview of what Ben shared. Adam: (00:36) Ben is a passionate leader dedicated to process improvement, finding dynamic solutions and is constantly working to learn and improve his own skill sets. In our conversation, Ben explains what it means to be a true business partner and talks about how these strategic leaders can champion change for the finance function of their organizations. He is all about opportunity and growth and I think he will give our listeners a lot of actionable insight. So now let's hear Ben Wann's perspective on the future of finance. Music: (01:08)Adam: (01:10) What is finance business partnering and why should we care? Ben: (01:14) Finance business partner- it's the mindset that an accounting professional doesn't just do accounting. We're not just reporting the numbers, looking back, we're integrated with the business and we're creating value, an active partnership with the operation side of supply chain management. You know, we're growing, we're and adding value wherever we can. Adam: (01:45) I recently saw that you wrote an article entitled the business is to soccer to help explain this philosophy. Could you maybe give a high level overview of your analogy? Ben: (01:55) Yeah, yeah. I had a fun writing this one. So the analogy that I used is that for most of the time that accountants have been around, we've been in the goalkeeper position, right? We're making sure nothing gets past us and in my analogy, I refer to, you know, like report and mistakes and all sorts of data issues that we're constantly trying to monitor. But now with different technology, we have the opportunity to play a different position on the team. And that's the midfielder. And my main argument in the article is that finance is now the mid-fielder and that's position that can fluidly move from defense to offense. So then making sure that businesses numbers are sound, and then then moving forward and helping to create some winning opportunities and some goals by providing, you know, the right insights at the right time. Adam: (02:47) I think that's a great analogy, you know, so in line with that, you know, what's some advice that you would have for someone who wanted to champion the change in the finance area? They wanted to go from the goalie to the midfielder? Ben: (02:58) Yeah, that's a question a lot of people are asking. I think that the big thing that you have to do is start to increase what I would call your orbit of awareness. So you have to go out there and read about what other finance business partners are doing so that you know what you have to do. A lot of times it's too easy for us are heads down and get siloed. But if you look around, you can find out what other people are doing to advance themselves. You know, sometimes it's taking leadership training courses. I learned how to build your influence, sometimes just become a more technically strong. But there's, there's a lot of people who've done it already and just no one who to talk to, like who's been in a similar situation as you are now. That's a great place to start. Adam: (03:30)You know, there was another article don't ask permission if you want to change the world. You know, there's a particular line that sticks out to me, but you know, one that I'll mention in a moment, but, you know, I was hoping you could explain your ending. What was your ending message in that article? Ben: (03:45) The ending message for me for this article is that you can't wait for opportunity and if you want to advance in accounting, you know, opportunity doesn't knock, build the door. I guess the overall premise too is, you know, don't ask permission to, to make a change. That makes sense and I've kind of built my career around this and I had a lot of success around it. So that's why I'm advocating for this message of probably professionals who are looking to grow and advance in their own careers. Adam: (04:15) And you know, a particular line I wanted to kind of point out was, you know, the problem here is that my colleague saw a roadblocks instead of opportunities. Could you maybe comment on that a little bit? Ben: (04:30) Yeah, It's, it's too easy to get stuck, right? So I went to, my colleague had a few suggestions on how she had this one report where it was done weekly. So we had 52 separate weeks of reports instead of one big report that's more comprehensive, you know, and what she got held up on is that she didn't think she had the ability to make these changes. I don't know if it she didn't think she had the technical ability or it was outside the scope of her work. But yeah, so it takes some time to work through these things. But I would suggest trying, just try and get some feedback from maybe your manager, your peers to see if something's working. That's the best way to start seeing roadblocks as opportunity. Adam: (05:13) So what do you think is on the horizon for the future of finance? Ben: (05:15) For me, I have been, in my career, I've seen the same companies struggle with the same problem and I think that we're getting closer to a solution. And the big problem for many organizations is that we spent way too much time trying to get the data out of the system and provide some sort of analysis. Usually when we're done it's taken too much time and it's not comprehensive or timely enough to solve the problems of business and answer the main questions. And what technology's doing now is it's providing a lot of low costs and then what's called low code, no code solutions that is really going to be key to putting the tools into more hands.The democratization of data is a term that's been going around. So more people are being able to access the data. and it's easier, you can't break the system. So I think that's going to be a huge thing, if finance wants to move forward, that we take these steps sequentially, right? We stop spending 70% of our time doing non-value-added activities and we get the building blocks in place. Adam: (06:24) So what advice would you give to somebody you know, who's, let's say they're, you know, the higher ups in the company are chasing whatever the flavor of the month is, whether it's blockchain or AI or whatever that key term is that they're jumping on and saying you have to do, you know, what advice would you give to the people who are actually doing the work to say, hey, how do you help them slow their horses or get them to realize that maybe we shouldn't jump in so quickly? Ben: (06:50) That's also a good question. I think the key is that the finance leaders need to talk to their teams to see how they're spending their time and to understand what they need to be able to do to do their jobs better. A lot of times, you know, these employee engagement surveys show that when employees had the right tools in their hands, they're more confident that they can do that job at hand. And you know, I think if employers talk to their employees, they would see it. These things are critical and it'd be really a value add to the business and that'd be my suggestion. Talk to your teams, see what they need and help them get the tools to do the job more effectively. Announcer: (07:33) This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

"12 Rules for Cyber You MUST Know" by Joseph Brunsman: https://www.linkedin.com/pulse/my-12-rules-cyber-joseph-brunsman/CPL Brokers, Inc.: http://cplbrokers.com/Contact Joseph Brunsman:LinkedIn: https://www.linkedin.com/in/joseph-brunsman-3a1102101/FULL EPISODE TRANSCRIPTMusic: (00:00) Adam: (00:04) Hey everyone. Welcome back to count me in. I am your host Adam Larson and with me once again with me once again, it's my cohost Mitch Roshong. As we continue to offer insight into all things affecting the accounting and finance world, this episode is going to focus on cybersecurity, as we hear from cybersecurity expert and bestselling author Joseph Brunson. Mitch, can you give us some background on Joseph and what your conversation was about? Mitchell: (00:35) Sure. Adam, thank you. Joseph is the vice president and CCO at Chesapeake professional liability brokers in Annapolis, Maryland. He most recently served as a Lieutenant in the United States Navy working as an anti terrorism and force protection officer. He has a background in systems engineering and cyber law and he is in the process of writing two books on cyber insurance. We focused on the progression of cybersecurity and how to create organizational cybersecurity policies to avoid some of the potentially disastrous costs following a cyber attack. So let's take a listen. Music: (01:11) Mitchell: (01:17) So data and technology are two of the most popular topics in accounting and finance. With so much data available to companies today and subsequent information being shared, what kind of emphasis should businesses place on cyber security? Joseph: (01:32) Sure. So, you know, that's a great question, I'd say that information is like the new oil. So data security is a huge deal and you know, of all the breaches that I've researched that I've written about, that I've worked on, you're really kind of see a common trend and it's that everybody who's been breached suddenly finds a way to spend more money and more time and more resources on cyber security after a breach. So kind of the lesson there is it would have been much easier to prevent that breach beforehand, you know, and that really kind of gets into, you know, starting from the top down where if a company wants to place an emphasis on cyber security and they all should, then, you know, it's really got to start from the top and work its way down. So that's from, you know, the board of directors has to get educated on the topic. Even if it's just, you know, a couple of YouTube videos that generally understand, you know, the basics of cyber security or network security and then from there filter that down through the organization. Mitchell: (02:38) So with that kind of top down structure, when it comes to implementing a different cybersecurity policies, what are some of the common strengths, weaknesses, opportunities, threats that you've come across when you're trying to help coach these businesses? Joseph: (02:54) Sure. So you know, kind of some of the common things we see obviously going to be different for each business, right? Because it's going to depend on the industry. They're in various environmental factors of what they're dealing with. But you know, we do see some common trends. The first one's going to be, you know, cyber security policies should not read like war and peace or some legal primer on contract law right there and we, we see a lot of that and always kind of makes me cringe because the primary purpose of a cyber security policy is really, you're supposed to be guiding the staff into making correct decisions, right? You're trying to tell them, Hey, this is what's acceptable and what's not. But more than that, really the biggest flaw that I see is, and this is, you know, it takes a little more time and effort to do this, but it pays off in the long run is, you know, they need to tell the staff members and employees, you know, Hey, this is the purpose behind the policy that we've implemented. And that really makes adherence to it much simpler, which makes the cybersecurity of that business, you know, exponentially stronger because, you can't plan for every possible scenario, but you can really stick to those major threats that you're reasonably foreseeing that could hit the business, you know, you don't need to plan for the apocalypse. So you want the cybersecurity policy to be understandable by the common person. Just complex enough that you're hitting the major wickets there. And that if there's something that you couldn't plan for or there's something missing in that cybersecurity policy, you could reasonably expect the average person, you know, to at least have a general understanding of who to go to to pose the question. Mitchell: (04:42) So what if you're new to this, what if you have never drafted a cybersecurity policy before and you're not even completely sure of what the potential risks are with all the new data and technology that's out there. What are some best practices for doing your own personal research and developing a process for implementing a new cybersecurity policy? Joseph: (05:03) Great question. So, you know, first off, Google is your friend, so that is an amazing place to start. There is a ton of great information out there. You know, try to steer clear of, you know, kind of minor organizations that you'd never heard of, but there's a bunch of major players out there. They're really kind of have templates for you. You know, best practices, you know, it's going to depend on each organization. But you know, kind of broad stroke here is get all the decision makers inside the room, block off a period of time and you know, that could be the board of directors, the C suite executives, it legal, your HR team, bring them all together, you know, and kind of start hashing through these templates that are available to you. So that way you get all of the different perspectives on what could potentially happen and how you should really respond to that. And that's going to be probably, you know, the best in terms of best practices because if it's, you know, if you have your cyber security policy and you say, hey IT guy do this delivered on Tuesday, and then you just try and, you know, push that out to the entire business, it's going to be a train wreck and there's going to be a million questions and you're going to have to go and redo the entire thing. So get everybody involved from the beginning. It's going to be much easier for everybody. Mitchell: (06:31) So as you start to, implement these processes, right, and we have all these different people working together, all the different functions of the business. What have you seen from, you know, different industries or just different firms in general as far as the progression of cybersecurity and what that means in our economy today? Joseph: (06:54) Sure so I think, you know, everybody is saying that they're taking cybersecurity seriously now, and I would really kind of push back against that because, you know, I think most businesses now are saying, hey, we take cyber security seriously. we have this one guy who does it right, who's in charge of it. But cyber security is really a full organization front that has to occur there. So, you know, it's something where the world is just getting more complex. And so, you know, that's on the regulatory side, it's on the cyber security side with the different types of controls or you know, software solutions or hardware solutions you could buy. So, you know, it's really, really getting complex. So, once again, if the people at the top aren't you know, taking this seriously and really getting involved, that's when really bad things happen.As far as, you know, specific industries that are definitely high risk, obviously financial services just due to the amount of PII that they have: personally identifiable information, the medical industry, they're getting hit constantly because of the personal health information in there. And then retail as well just because of the credit cards. So it's, you know, it's really kind of well across the board. Every industry I can think of really has to tart start taking this seriously, unless they just don't use computers, you know, in which case they probably won't be a business for long. Mitchell: (08:32) This is kind of off script here, but I'm just curious, you mentioned a lot of different, industries right there. In your opinion, are the experiences that you've had, what is like the main target of, you know, cybersecurity breaches? Are people looking for financial gains? Are they looking just for the personal information? Like what's the point? Joseph: (08:52) Sure. So it really, once, it depends, but I'll, I'll qualify that statement for you. So, you know, hackers really want information that doesn't change. So that's why I say like, you know, financial services industries are so specifically targeted because your date of birth doesn't change. For all intents and purposes, your social security nber probably doesn't change and I think even if you get a new one, that number is still attached to the old one. So, you know, they're really looking for things that will never change. You know, in terms of the medical industry you know, they're looking for that protected health information. So they want to see, you know, that obviously it's got your social, it's got a bunch of insurance information in there. Once again, a bunch of things that don't change. So those are like the highest cost items on the dark web or things that never change, then you get into retail where we're dealing more with credit card information or financial account information. That stuff can change very rapidly. You know, you could cancel your credit card and get a new one sent to you tonight, so that tends to be lower value, but it goes, for sale much faster on the internet. Mitchell: (10:08) Hmm. That's interesting. So you're saying a lot of the hackers, they're taking this information and they're not even the ones that are using it. It's really, it's then just out there on the black market for somebody's highest bitter and they do what, what they want. Joseph: (10:24) Oh, absolutely. So, you know, if you, if you hop on tour and you started going to some questionable websites, you can actually see where they're selling, bundles of information. And interestingly, they actually have a better guarantees than most of what we'll find in the cybersecurity world. So, you know, your antivirus providers probably not going to say, hey, if you get breached or give you $1 million, but you know, the guys writing the software that could breach your computer system. You know, they've actually, they've got holiday sales, they've got 1-800-NBERS. If you need assistance with implementing the code to try and hack somebody, you know, they've gotten minim return guarantees on, you know, how much money you'll get with the ransom, how many organizations that you can penetrate with with their software. So it's really an unfortunately a very fascinating, you know, economic system, but it's 100% geared against legitimate businesses. Mitchell: (11:24) Right. Yeah. Now that is fascinating and I'm sure this is really difficult to ballpark, but, the different cases where organizations have been attacked, what are some of the costs that you have seen as far as, you know, end results from, from being hacked or from being breached? What's the cost to these organizations? Joseph: (11:45) Sure. That's, you know, that's a great question. So, you know, I'd say the primary cost, for the people you know, really involve the day to day players, that organization is embarrassment. That's something not a lot of people talk about. But a lot of firms, you know, they're just really embarrassed that they got breached because so much in the business world, you know, as complex as the world is now. A lot of what we do, we just operate on trust, right? Like you just trust that your accounting firm does your taxes correctly. You're going to trust that target is keeping your payment card information secure. So that's really kind of the, the incalculable cost is removing that trust, with your clients or your customers. And then from there, you know, it's really all over the board in terms of cost, but it can get very, very expensive. So, you know, probably the biggest costs you're going to see is going to be the forensics costs. So that's going to help you determine the scope and nature of the breach. Those guys last, you know, best metrics I saw, they're charging 800 to $1,200 an hour. Wow. And a lot of them are charging in 40 hour blocks. So if you do want hours, they charge you for 80. You know, the, the attorneys generally if you have, you know, council, you're going to need it to assist you with this because it's a very complex endeavor to navigate through. You know, they're charging, you know, partner level is probably about 450 bucks an hour, you know, then you've got credit monitoring which could be up to $7 a person and then you've got just the notification costs. You know, if you're going to notify 100,000 people and you're mailing them a notice and you're paying, what does the stamp cost, those costs start adding up very, very quickly. And then, you know, kind of beyond all of that stuff you're legally obligated to do anyways. It's just the business interruption time. So, you know, we saw that with CCH right when they got breached a major provider of a tax software information, you know, just the downtime there, how much money that's going to cost them. You know, even next year after they're back up and running and everything's fine. You know, are accounting firms going to take their business to say Thomson Reuters because they just don't trust CCH anymore. I mean, you know, we just, we don't know, but it's, it's going to be interesting. Announcer: (14:20) This has been, count me in IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at https://www.imanet.org.

Contact Ginger White:Email: ginger.r.white@icloud.comLinkedIn: https://www.linkedin.com/in/virginia-ginger-d-white-cma-csca-bb-mbb-mba-mssf-a7221b1/IMA Bio: https://www.imanet.org/about-ima/ima-leadership/virginia-ginger-whiteInstitute of Management Accountants: https://www.imanet.org/American Accounting Association: https://aaahq.org/FULL EPISODE TRANSCRIPTMusic: (00:00)Adam Larson: (00:05) Hey everyone. Welcome back to "Count Me In", IMA's podcast about all things affecting the accounting and finance world. This is Adam Larson and I'm joined by my cohost, Mitch Roshong. As you know, the purpose of "Count Me In" is to bring you the latest perspectives and learnings on everything management accountants need to know. We strive to consistently share valuable insights from industry experts and those who are shaping our profession, and today's episode is no exception. We were delighted to have the opportunity to sit down with one of the great leaders in our industry, ginger white. Ginger joined us in our office here in Montvale, New Jersey and talked about what it takes to be a valued leader of the finance team. Ginger is the global chair emeritus of IMA's global board of directors and has a wealth of knowledge and expertise that we were lucky she was willing to share with us. Mitch, what else can you tell us about Ginger and your conversation with her for this episode?Mitch Roshong: (00:56) Ginger is an executive level financial management professional with over 20 years of experience. She spent 22 years at Cummins, an American Fortune 500 company that designs, manufactures, and distributes engines, filtration and power generation products. There, she spanned roles from cost analyst through corporate purchasing finance director acquiring and developing valuable skills along the way. She is a CMA, CSCA, Six Sigma black belt and now serves as the chief operating officer for the American Accounting Association. In our conversation, we talked a lot about Ginger's tenure at Cummins, the skills she noticed to be most valuable and some of the best wins as a finance professional. This is a great episode for those interested in learning what it takes to create your own successful long lasting career. So let's go to the conversation.Music: (01:47)Mitch Roshong: (01:53) Take us back to when you first started in finance and business. Was it originally your intention to work at the same company for the majority of your career?Ginger White: (02:01) Actually, no, it was not. So when I actually joined Cummins in 97 I had been teaching Accounting I at a small college called Ivy Tech in Indiana and I was teaching Accounting I and absolutely loved it and they were changing the accreditation standards that required a master's degree or work experience equivalent. And I didn't have either. So I heard Cummins would pay for your master's degree. So my whole purpose to go there was to get my master's degree and quit and teach full time. So I spent 21 and a half years there before I left recently to go be the chief operating officer at the American accounting association.Mitch Roshong: (02:37) So was it always your longterm goal to achieve some kind of C-suite position or did you think you'd be teaching your whole career?Ginger White: (02:44) Early on? After I'd been teaching Accounting I, I really did think I would be teaching my entire career. However, when I got to Cummins and started really learning about cost accounting was introduced to IMA, my path changed. And I think it's really important to always flexible to what life might bring you. And I would have never guessed that I would be C-suite at some point and I'm really enjoying it and my new role.Mitch Roshong: (03:10) And as far as the progression that you did have through Cummins, how did you develop and acquire the skills needed to kind of progress through all these different positions? What were some of the skills that really proved to be most valuable in supporting your recent role that you, the most recent role you held there?Ginger White: (03:27) Actually always being willing to learn and pushing yourself above and beyond what you ever think you can. So I had initially started getting my MBA immediately as I joined Cummins. And so I finished that in 2002 and then later I ended up getting my Master of Science in Strategic Finance in 2006 and I had always had on my individual development plan, my CMA. And it wasn't until 2014 that I actually achieved that, which was very valuable because I had taken a role as a Six Sigma master black belt, which was in the quality function. And the skills I gained there actually is very relevant to today because we're really moving into a world of data analytics. And when I did my master black belt role, that's pretty much what we did. So then when I really wanted to move back into my corporate purchasing finance role at Cummins, I felt that I needed my CMA. So that was very valuable in 2014 when I achieved that. And then in June of '15 is when I moved back into the finance role in a corporate purchasing finance.Mitch Roshong: (04:28) How about the other side of things? What were some of the daily challenges of directing large growth plans and executing different strategic initiatives for Cummins?Ginger White: (04:37) That probably came mostly in the corporate purchasing finance role. There, when I joined the team, we had implemented, prior to me joining something called the strategic finance solution for payables. And when I got there, there were lots of issues that systems processes were failing daily, suppliers were not getting paid as we promised and so forth. So I went to work immediately to fix that. And when I left, the individuals were getting paid within five days. So we still were able to extend our payment terms, which actually helped Cummins with their cashflow, but our, our suppliers were getting paid within on average five days. So I felt really proud of that because it actually helps some of our suppliers become debt free and it was a win, win, win.Mitch Roshong: (05:24) And what do you attribute some of that success to? How were you able to overcome those challenges?Ginger White: (05:28) I really do attribute a lot of that to Six Sigma, my problem solving skills and then just getting everybody together and working collaboratively. It's, it's a skill I've naturally somehow come about. And I think Six Sigma helped me do that because a lot of times people will just try to solve things from their perspective. And it's so much more powerful when you get cross functional teams together to really talk and understand deeply what each issue might be in a given area. So that's what we did. We really looked at it solution, we looked at the payables process, we looked at all kinds of things to really determine what the real root cause was. We fixed those, we put controls in place to ensure the failures just stopped ongoing. And then we, we had good suppliers that we partnered with and they held us accountable too, which was really powerful. So it, it was it was a great experience to, to really do that. And I have lots of those, those kinds of areas where we've solved big issues over time.Mitch Roshong: (06:24) Well that was kind of my next question. I was going to ask if you had any particular success in addition to this, maybe looking back that you were particularly proud of as an accomplishment that's still sticks out?Ginger White: (06:34) So one of the other big areas that I'm extremely proud of leads back to when I was a six Sigma black belt and the 2005, 2006 time frame, I led a project that was a finance recruiting project for Pat Ward, who was at the time the engine business worldwide controller. And shortly thereafter became our CFO. What I did is I created this recruiting process for finance. And actually we started recruiting at the IMA student leadership conference. So these students come and they're just wanting an opportunity. And the schools they attend most times are very small and they don't get big corporation attention. And so given those kids the opportunity to have a corporate experience through an internship and ultimately full time opportunities that they would've never gotten, makes me very proud.Mitch Roshong: (07:25) Another perfect segue for me because my next question was kind of about the, the two different accounting associations that you're working with. So what kind of leadership do you think you bring to IMA and then your, your a C-suite position coming from, you know, a corporate environment?Ginger White: (07:41) For me, I, I see lots of collaboration opportunities between the two organizations and I've seen that both at Cummins. We partnered with some of our suppliers to do joint negotiations for lower costs. I see that opportunity possibly, and then just the whole handoff of the profession. So the professors start initially creating the future of the profession and those students may not even know where they're going at that point. And they began to start to plant those seeds of love for our accounting and finance. They may go into public accounting, they may go into corporate management accounting type roles. And I think it's up to all of us to just make sure the profession is stronger in the future and they pivot to more data analytics. So I think both are really focusing in those areas. And I see lots of collaboration opportunities for both organizations. And I think both the leaders of both organizations is really, they have the same passion as to make the future better for, for all of those that, that tend to decide to go into that profession, whether it to be, you know, a doctor to teach accounting or you know, to be a management accountant, a CFO, controller, or whatever the case might be. So I think it's important that we really look at that holistically instead of siloed.Mitch Roshong: (09:04) So that's a good benefit for the association in the organizations. How about on the other side of it were a students, young professionals. What is the value of being a part of an association in furthering your career?Ginger White: (09:18) I just can't say enough good things because I'm a product of IMA for sure. And had I not had the experiences that I've had with IMA, I don't believe I would have ever had the opportunity to be the COO of of the American Accounting Association. Networking is critical. You need to have people who actually tell you the truth about a situation instead of sugarcoat maybe how you're behaving or whatever the case might be, or just emulating other leaders that you watch as you grow. So I've had the opportunity to watch many chairs lead IMA over time. And so I feel like my year as chair was better because of them and watching their behaviors either good or bad and learn from that and try not to do the bad things and only, you know, work on the good things. So just doing that and learning in a political environment because that was probably one of my weaknesses quite honestly, because I am very truthful and you know, I just want to get the job done and do it really well. And I've learned over time, politics matters and still learning on that every day. Right? How do you ensure that everybody is aware of things? And what order do you inform them of that? Right? You start first the CEO and then so forth. Right? Who needs to know next and how do you empower people, excuse me by that. So I think it's, it's really been extremely beneficial to, to serve in the various roles like as chapter leader all the way up through the president of the chapter and then at the council level. And was I always super confident at that time? Absolutely not. Right. But it was a very nurturing environment. The people around me, the leaders really wanted me to succeed and brought me in when I knew nothing. And I remember Ron Luther asking me to be the student rep at the council level and I had no idea what that meant. And I, I even remember when I was told that I was the incoming president elect, I had no idea. They just kept pushing me into roles. And probably because I would've feared it and so I didn't have a choice. It's like, Oh wow, well they think I can do this. So I think that's been super powerful for me. And then kind of helping others have those opportunities as well has been really rewarding. So getting other new employees at Cummins and pushing them when it may be uncomfortable but then seeing them succeed and, and that's really rewarding. So giving back is just easy after you've been given so much.Mitch Roshong: (11:55) We've done a really good job looking back at a lot of your accomplishments and talking about things that you've done in your career. But I'm kind of curious, you're clearly a lifelong learner, so what other goals do you have for the future? What plans do you have and what's next?Ginger White: (12:11) So some of the things that I've thought about now that I'm part of the American Accounting Association, I'm really interested in obtaining my Certified Association Executive certification. I feel like it will just further help that organization grow and develop over time as well. The other thing I really want to do is really support Christian Cuzick, he's our incoming chair of IMA and one of his big initiatives is corporate outreach. So I'm looking really forward to helping make his year phenomenal and even better than mine. And the other thing I'd like to do is really probably teach back in the classroom again from my original passion, all of the learning I've done, how can I give that back to the the world, right? So it's a gift that I've been given and if I can help others be more successful then that makes me happy. So that would be probably my, my big next things to do.Mitch Roshong: (13:04) Anything else you want to add? Any last remarks?Ginger White: (13:08) I'd just like to say thanks to IMA and all of our members for giving me the opportunity to be chair. Cause again, that was a great development opportunity for me. We had a lot of challenges, but oh my goodness, what an amazing year we've had growing from 111,000 members to almost 140,000 members. It's unprecedented. So kudos to all of the staff and all of the volunteers who made that happen. And I'm just so grateful to be a part of it.Announcer: (13:36) This has been “Count Me In”, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

CMA Commercial: You’ve got to earn it. IMA Global Ad Campaign: https://www.prnewswire.com/news-releases/ima-launches-global-ad-campaign-to-highlight-importance-of-certification-in-todays-business-landscape-300918013.htmlJeff Thomson Bio: https://www.imanet.org/about-ima/ima-leadership/jeffrey-c-thomsonIMA Website: https://www.imanet.org/About IMA: https://www.imanet.org/about-imaAbout CMA: https://www.imanet.org/cma-certificationIMA Education Center: https://www.imanet.org/education-centerJeff Thomson LinkedIn: https://www.linkedin.com/in/jeffthomsonima/FULL EPISODE TRANSCRIPTMusic: (00:00)Adam Larson: (00:04) Hello everyone. I'm Adam Larson.Mitch Roshong: (00:06) I'm Mitch Roshong.Adam Larson: (00:07) And we are excited to welcome you all to a special episode of "Count Me In". Starting today, we'll be releasing periodic episodes that highlight staff members and key stakeholders of the Institute of Management Accountants. This IMA mini-series within 'Count Me In" will help our listeners better understand who we are and what IMA's vision is, along with the value of the CMA credential. For today's conversation, to kick off our talks, Mitch and I sit down with IMA's president and CEO Jeff Thomson.Mitch Roshong: (00:34) Jeff is considered an expert on risk management and internal controls and is a global thought leader in management accounting. He assumed the role of president and CEO of IMA in 2008 and has since led the execution of a strategy that has resulted in IMA becoming one of the fastest growing and most influential accounting associations in the world. Jeff works tirelessly to help advance the profession and his leadership is positively recognized across the organization.Adam Larson: (01:00) In this conversation we asked Jeff various questions about IMA, the CMA, and the future of the profession. His passion and professionalism is evident in his responses and truly reveals the overall guidance and direction of the organization. Now let's hear from IMA, president and CEO, Jeff Thompson.Music: (01:22)Jeff Thomson: (01:25) Basically, IMA grew and we've been growing exponentially for 10 years. Primarily because we went from being inwardly focused to outwardly focused, meaning an intense, unwavering, relentless focus on member value on the CMA program, on volunteers as opposed to being inwardly focused on internal management in, in terms of you know, various issues. Of course we need to be focused internally and build a strong, solid inspired team. But, you know, the more you talk to yourselves, the less you're talking to the market and what are your needs and wants? How can I, how can I enrich organizations, how can I enrich your career? How can I enrich the public interest? So I would say more than anything else, it was that intense focus. And then I would say a a genuine sustained focus on core values and culture. I truly believe, although I don't have hard evidence that that helped lead not only to our growth but our strategic turnaround 10 or so years ago.Mitch Roshong: (02:43) With that change in focus, how do you anticipate sustaining that growth and where do you envision IMA in the next three to five years?Jeff Thomson: (02:50) So sustaining growth and managing the growth that you achieved is one of the hardest things in business. Sometimes it's even harder to manage and sustain your growth than it is to achieve the growth in the first place because sometimes you lose sight of what got you to your growth. The fact that you did it one member at a time, one partner at a time, one academic influencer at a time, one volunteer at a time. And as long as we take that approach to delivering value to staying current with technology and innovation having a solid strategy, fierce conversations embracing a culture of challenge and having a great team that first and foremost lives its core values and its culture. I believe will continue to do well. You know, the business environment, whether it's our members or IMA itself is very challenging. There is competitive risk. There's technology risk, as we've globalized, there's geopolitical risk. But I have a, a lot of confidence that if we continue to have an everyday sense of urgency that we'll continue to deliver for our members and even up our game because quite frankly, they should expect nothing less of us.Mitch Roshong: (04:18) What are some of the key competencies that management accountants need in today's industry that you are making sure we here at IMA are focused on continuously supporting for our members?Jeff Thomson: (04:27) Great question, Mitch. And although I'm very proud and honored to be CEO of this great, great organization my roots are in finance and accounting and I'm proud of that. You know, I was a SBU CFO at AT&T. I started out as a finance manager and analytics. And so I've seen how our jobs and our careers have evolved over time. Um you know, some of it is the CFO team is expected to do more with less meaning, more responsibility. In addition to closing the books and filing statutory reports, we now want you to get more involved in financing decisions and merger and acquisition activity. Funding, forecasting, strategy, technology, operations. Um you know, Doreen Remmen, our CFO is, as you well know handles all of those things as the chief financial officer. So on one hand, that's a great, great opportunity to be influential within your organization and outside your organization. But we have to be there to deliver the competencies to build that talent. And certainly the area of technology and analytics, more and more management accountants whether they're in financial planning and analysis or other sorts of decision support activities. You know, they're expected to offer insight and foresight beyond the numbers, but you need to be grounded in the fundamentals of data analytics, data visualization, storytelling, strategic management. And you know, IMA is up to the challenge and we're delivering some great products, but we have to deliver even more to build that competency, to meet that great challenge and that great opportunity.Adam Larson: (06:23) In addition to the great opportunities created through continuing education, what other benefits design may offer its members?Jeff Thomson: (06:30) Sure. Well, it starts with the CMA program. We're very, very proud of the CMA program. It's grown tremendously over the years outside and inside the U S because it resonates with CFOs and their teams who are aspiring to be stronger in the areas of insight and foresight to make sense of the numbers, to make sense of a complex competitive and market environment. So it starts with the CMA program. We're very, very proud of that. We've announced that for January, 2020 the exam will stay current with technology and analytics and reflect that in its revised exam in January. Um we're also very proud of our relatively new credential called Certified in Strategy and Competitive Analysis for what you need to have a CMA first. That's very, very important because as you grow on the finance and accounting team, you're going to get more and more involved in strategy and competitive analysis. So we have this wonderful specialized credential that we're also proud of and we hope our members enjoy and reap the benefits. And then last but not least we've developed a competency framework that is broad and yet deep. It covers strategy, it covers reporting and controls, technology and analytics, business operations and supply chain, athletics and leadership. We have a tool that supports that broader framework called Career Driver(R) that allows an individual to self-assess their skills against an objective standard and then sees educational opportunities to help address gaps or seize opportunities in their own professional development.Adam Larson: (08:22) Going back to the CMA, can you tell us a little bit of the history and the importance behind the tagline, "You've got to earn it."Jeff Thomson: (08:28) Well, the, "You've got to earn it." tagline is one that we're very, very proud of and you know, three years ago around 2016 we decided that we need to listen even better to what our members around the world are saying. They're saying the CMA is the world's best kept secret. Yeah. We've got a nice ecosystem, a ground game we call it, of students and members and chapters and councils around the world that are, you know, creating a viral awareness. Word of mouth wearness of this great certification, but we need more. And so in 2016 or so, we developed our first ever integrated ad campaign. We hired a, a an ad agency. We did a ad in Hollywood on the CMA program. Uh we had TV, radio, print in Forbes, and of course social media. And we came up with the tagline, "You've got to earn it." for two reasons. One is because it puts a sense of accountability and empowerment in the individual. You've got to earn it. You've got to sit for the exam. You've got to be inspired to take yourself to the next level. And by the way, inspire peers as ambassadors for the CMA program. The other reason was for competitive purposes. You know, we began to see in the marketplace a trend toward grandfathering whereby a new certification is introduced. You get the certification for free by paying a fee. You know, maybe for a year after introduction of the new certification. The CMA program every single CMA around the world, including myself, had to sit for a relevant, robust, rigorous exam. Um except for one person. And it wasn't me. It was the founder of the CMA program, Dr. James Bullock, I think they said, Hey, you know what, Jim, you created the exam. We're not gonna make you take your own exam. So we had concerns about that quite frankly. When we saw a tendency toward this grandfathering, is that about the numbers or is it about the profession and genuinely building talent? So "You've got to earn" it says we're not going to we're not going to go the way of gimmicks, giveaways or grandfathering. "You've Got to earn it."Mitch Roshong: (11:09) Once you earn your CMA or even as a member of IMA potentially interested in pursuing your CMA, we release a lot of content about the opportunity to serve as a true business partner in the organization. From your perspective, who is a true business partner, particularly in today's digital age?Jeff Thomson: (11:26) Right? Yeah. Great question. And you know, I like to, I don't like to talk too much about myself, but storytelling I'm told is the thing to do these days, including on podcasts. But you know, when I became CFO of a, a strategic business unit at a great, great company AT&T back in the 90s I was actually introduced and presented the position as you're now the strategic business partner for the business sales organization, an $18 billion operation. And I was very proud and honored. I did ask what it meant. I didn't quite know what that meant. And I, with a tear in my eye, I said, can I put CFO on my business card? And because I, I, everybody knows what CFO is. But back then and even today, you know, what is a business partner? And a, a business partner is really two things. Um from a CFO perspective. One is you are the steward for the corporation. You are a fiduciary of the corporation. You protect assets, you safeguard assets. You are a value steward. First and foremost. You have allegiance to that related. However, you're a business partner where you sit across the table from clients, you could call them internal clients. You have given take, you have a culture of challenge. You understand their business. They understand the need to have a sound financial discipline and, and portfolio. You have given take, you come to great outcomes and conclusions as it relates to new products and funding and business cases, new markets. You know, what are some of the risks, what are some of the opportunities what are, what are the forecasts look like? What is the funding look like? So that's what a business partner is all about. It's not one sided. It's not you stay in your silo, but it's not that you become part of your internal client silo. You, you have to have a lot of savvy. You have a lot of adaptability and quite frankly, you have to have a lot of insight and foresight. And in a digital age, the pressure gets ratcheted up because in a digital age, whether it's artificial intelligence or robotics process automation or perhaps blockchain more and more of these technologies are replacing the more routine repetitive tasks, whether they're in audit or transaction processing, which means that if we're going to have greater influence as business partners, we've got to raise our game and upscale in strategy management and advanced data science and analytics.Adam Larson: (14:27) So what does IMA doing as far as continuous learning opportunities and its efforts to prepare the industry professionals to become strategic business partners?Jeff Thomson: (14:35) So IMA actually has a long, long history of research and thought leadership in business partnering. It actually dates back to the early 1980s. We've got a long, long stream of compelling research. On one hand it's interesting to see what's changed, but it's also interesting to see what has stayed the same in this area. You know, one of the things that has not changed as much as we'd like is curriculum reform. So in 1986, that AAA (American Accounting Association) launched the what's called the Bedford report. The Bedford report simply said, there's a gap between what accounting educators teach and what professional accounts in business actually do. One could argue that that gap has actually widened as the accountability and responsibilities of the CFO team has widened. So we need to continue to to address that. You know, in the meantime, in addition to this steady stream of business partner research I mentioned earlier in the podcast, our new competency framework, which is very broad and comprehensive new learning products are coming out each and every day as it relates to data analytics, data visualization storytelling, data governance strategic management, and more. So stay tuned. Just as technology is moving at a very, very fast paced, IMA not only intends to keep up, but to stay ahead. Again, we owe it to you as our members, our cherished members around the world.Announcer: (16:23) This has been “Count Me In”, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

"Creating Great Long-term Sustainable Value" by Dr. Mark Frigo: https://sfmagazine.com/post-entry/october-2018-creating-greater-long-term-sustainable-value/Contact Dr. Mark Frigo:Email: mfrigo@depaul.edu LinkedIn: https://www.linkedin.com/in/markfrigo/Twitter: @drmarkfrigoWebsites: www.markfrigo.com and http://go.depaul.edu/SEVFULL EPISODE TRANSCRIPTMusic: (00:00)Adam Larson: (00:05) Hey everyone. Thanks for coming back to IMA and joining the conversation for Count Me In. I'm your host, Adam Larson and once again I'm joined by my co host Mitch Roshong. Our episode for today is at the center of all skills needed to be a successful accounting and finance professional. As we listened to our conversation with Dr. Mark Frigo on the topic of strategic leadership. Mitch you spoke with Dr. Frigo, how did it go?Mitch Roshong: (00:28) Dr. Frigo is an excellent speaker and it was a pleasure talking with him. Dr. Frigo is the director of the center for strategy, execution and valuation and the strategic risk management lab and is the Ezerski Endowed Chair of Strategy & Leadership in the Driehaus College of Business at DePaul University in Chicago. We had a great time talking about the importance of leadership and how it needs to be a part of all business strategies. Without further ado, let's turn to the conversation we had.Music: (00:56)Mitch Roshong: (01:02) So my first question for you is what is a leadership Driven strategy?Dr. Frigo: (01:09) So leadership driven strategy is applying great business strategy that we've learned in studying high performing companies to the individual leader and also to teams within organizations. The idea is to identify what are the patterns of strategic leadership activities and team activities that create the most value for their team or their organization.Mitch Roshong: (01:42) So my understanding of this, as you just said it can be focused on individuals, and onto teams in general. So kind of what's the difference, I guess? How can we apply great business strategy at the different levels?Dr. Frigo: (01:56) So let me describe how this, process evolved. The return driven strategy, which is, discussed in the book driven, that I authored a few years ago, describes the pattern of strategic activities of long-term high-performance companies and those seminars and other works that we've done in presenting that framework to management teams, naturally, to internalize the way of thinking, they started thinking that CFO teams and the executive teams and management teams that we worked with started thinking about that pattern within their own, at the micro level, at the individual leader level and at the team level. So when we do workshops with, management teams, we often are presenting the return driven strategy framework, and as part of the exercise for understanding and learning and mastering it, we apply that to the individual leader. And then the next iteration would be applying it to the team; usually, in the case of a CFOs I'll present it to the individual CFO leader and also present it to the finance organization within that type of an environment.Mitch Roshong: (03:17) So to put this all together, it sounds like you've done a lot of practice with this and I'm just curious, you know, what kind of application, what kind of, implementation have you seen? How has this leadership driven strategy been used at companies and how has it helped?Dr. Frigo: (03:35) So, Mitchell, that's a good question. The, leader through leadership driven strategy has been a mechanism or a way for let's say a CFO to develop a strategic finance function within his or her organization. So the exercise is usually focused on, doing, we often do a SWOT analysis, which would be doing, you know, strengths, weaknesses, opportunities and threats in terms of assessing, the strengths and weaknesses relating to, different aspects of the leadership driven strategy. A framework, which I'll describe in a few minutes.Mitch Roshong: (04:18) Oh, that's awesome! And then just from your experience, what are some of the key takeaways from this strategy?Dr. Frigo: (04:27) Yes, so let me just describe, the, the logic and language of leadership driven strategy. It's a hierarchy of 11, tenants or activities. And then, three foundations. The first, , the top, the number one tenant is ethically create value. That's the most important, idea for an individual leader as well as for a team ethically create value. And then the next two levels of the framework are fulfill, otherwise unmet constituent needs, those constituent needs, which are highly valuable and valued by their stakeholders. Those could be either internal or and or external constituents or stakeholders. And then the next one number three, 10, and three, is serve the right constituents with those needs. And then how do we do that? We do that by innovating our offerings as professionals, individual leaders and teams. We do that by delivering our offerings efficiently and effectively. And we also do it by branding our offerings being known for that offering and how we create value for our constituents. Those, l call, the competency tenants and then supporting those would be five supporting tenants. The person supporting tenant is partner strategically, meaning partnering strategically to do what to innovate, deliver and brand or offerings targeted at fulfilling the otherwise unmet needs and the constituents we're serving, all with the idea of creating maximum value in doing so ethically. The next, supporting tenant is redesign your value chain, the way you do things and the way that you conduct your activities. Again, aligned with the innovation, delivery and branding of the offerings. And then tenant nine is engage yourself in others. Engage yourself and others means engage yourself, in a positive manner to create value in terms of that individual leader or the team and others means your other stakeholders. A balanced focus and options of next supporting tenants. And that means taking care of the current business but also creating the future, the future of value creation. And this also involves some strategic quitting meaning just continuing certain activities that are not value added for a team or for an individual leader. And then finally, number 11 is communicate strategically and holistically. Meaning we communicate the way we speak, the way we send emails, the way we communicate individually or as a team. The words we use, our appearance, all of that is the way we communicate our brand, which is, you know, important for a professional and for a team. And those are the 11 tenants of supported by the foundation's genuine assets and unique capabilities. Those are what you have that make you unique they're a combination, they're your skills or your experience, they're you're relationships and so forth. There'll be intangibles that you have as an individual leader and a team. And there's also sometimes missing genuine assets, which we have to try to figure out as leaders or teams, how do we create those missing genuine assets or partner to achieve them? The next, foundation is vigilance, the forces of change. And that means being very vigilant about force of change, technological and all other changes that are going to create opportunities for us as leaders and also perhaps create threats for us as leaders and teams. It's really risk management. And then finally, the very baseline, the very base foundation, the bedrock is mission, personal milestones and values. So here we look at identifying the mission or a why, for a leader or a team. Making that very explicit, and also having personal milestones. And generally the personal milestones are defined as follows. If we are meeting a year from today, what would need to happen, or be achieved for us to be very satisfied with our progress. It gives us a real clear milestone in terms of tangible outcomes. And then finally, your values. What are the three words that would describe your values? And that really goes back to the branding of an individual leader or a team. Meaning what are the three words that you would like others, your constituents use to describe you? And that's something that I think in terms of strategic communication and branding yourself as a leader and how you create value, which is very important. So that's a high level summary of the leadership driven strategy framework.Mitch Roshong: (09:53) Well, it sounds like that framework is , very well structured and a lot of support is given to it. A lot of thought went into it and I can tell that, it can certainly be applied at many different levels within an organization, many different individuals, but I'm curious if someone was interested in trying to implement this strategy within their organization, what are some of the key questions you believe they should ask first before starting this kind of initiative?Dr. Frigo: (10:23) So Mitchell, that's a great question because when we look at, we look at this framework, no, really one of the fundamental questions would be, what are the otherwise unmet needs of my internal and external stakeholders as the individual leader and as a team. And more importantly, how are those otherwise unmet needs changing? Cause obviously if I as a leader or team, if I don't change, if I don't innovate my offerings, for example, and the unmet needs of my customers and my stakeholders and constituents changes, I'm out of alignment. I become irrelevant in that case. Would you agree Mitchell?Mitch Roshong: (11:07) Absolutely.Dr. Frigo: (11:09) The words we use in the framework would be innovate your offering. That means changing your offerings. Sometimes in small, sometimes in more substantial ways, changing your offerings in ways that better fulfill the otherwise unmet needs, especially the changing otherwise I met needs of our constituents.Mitch Roshong: (11:34) Very, very good. I appreciate that kind of given me a little more insight into that question. I think the kind of the foundation or the main perspective that we need to consider is, if the leadership team, was to kind of pursue this strategy, you know, how do you think they should address that? What should their initial steps be moving forward?Dr. Frigo: (12:05) So, what I've done in terms of workshops, teams and individual leaders is, they would often do a background reading on leadership driven strategy and returns driven strategy. They would often do a pre-assignment, meaning doing that, doing an assessment of their strategy. Currently they're individual leader from driven strategy and then the work-shopping that we do, is really to be interactive with a team or you know, a group of leaders to apply the way of thinking. It's really all about changing the way you think in a positive and powerful way. Changing the way you think in a positive way means ability to create greater value as an individual leader and as a team Changing the way you think in a positive and powerful way. The word powerful means creating the most impact with minimum effort. We also call that Judas strategy using leverage.Mitch Roshong: (13:12) Well, Dr. Frigo, this has been very insightful. I certainly enjoyed the conversation. Leadership is something that, I truly am passionate about myself. So, with your thought leadership, your expertise, are there any other last minute points that you would like to offer up to our listeners here on strategic leadership and, the leadership driven strategy?Dr. Frigo: (13:34) Yes, Mitchell. I think the, looking at some of the work we've done with high-performance companies and research and high-performance leaders, including high performance CFOs, we identify those high performance executives and teams they think, act and communicate strategically not in the situational way, but strategically they build unique and talented teams, and they're very innovative. So there's three characteristics that I think applying leadership driven strategy are very important for companies and their teams to consider.Announcer: (14:20) This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org

Contact Kaiser Mock:LinkedIn - https://www.linkedin.com/in/kaiser-mock/FULL EPISODE TRANSCRIPTMusic: (00:00)Adam Larson: (00:05) Welcome back to "Count Me In". Thanks for joining us at IMA as we bring you the latest perspectives and learnings on all things affecting the accounting and finance world. This is Adam Larson and with me as always is my co-host Mitch Roshong. Today's episode we will get into an area of accounting, not often discussed - the importance of relationships with non-financial individuals. Our guest for today's conversation came to us from the MillerCoors Brewery in Golden, Colorado. And with that I'd like to ask our listeners to send us a note letting us know where you're listening from. We'd be happy to share some of the unique locations and let everyone know what kind of global reach "Count Me In" and IMA has. But now back to today's episode. Mitch, how was it speaking with Kaiser Mock?Mitch Roshong: (00:50) Our conversation was great. Kaiser is a Financial Analyst for Brewery Operations at MillerCoors. He monitors the brewing process and provides assistance with costing, variances and overall manufacturing processes. He is also a former IMA Young Professional Leadership Experience winner and remains very active with IMA as he strives to share his experiences and talks about the opportunities within accounting. The underlying theme for today's episode is the importance of relationship building for accountants. Automation has happened before and will continue to change their roles as new technologies emerge. But accountants of the future must be able to communicate effectively and work with individuals across all functions to add value to their organizations. Kaiser shared how he's worked alongside and built relationships with non-finance individuals to help drive efficiencies. And I think our listeners will be able to learn a lot from this episode. So let's listen in.Music: (01:43)Mitch Roshong: (01:48) So, tell me. What are the trends you've seen with accounting and automation? I know we tend to think about trends being these big dramatic changes but are we seeing changes right now that maybe are impacting business and accounting you know, slowly and steadily and a big future implication?Kaiser Mock: (02:09) Yeah, you know, Mitch. I think it's such an interesting topic with this because there's a lot of concern and a lot of hype out there right now about where accounting is going and what role accounting is going to play in the future. But I think if you look at what the profession has done over the past 10, 15, you know, you go back 50 years, accounting today is dramatically different than it was then. And you look at the horizon in technology and what, you know, even computers and automated reports have done for us. Automation is not something that's new to the field. It has been happening for a very long time now. And I think that what you see today is there might be an increase in the speed of the change, but the change is all the same. And I think what the biggest topic that I think when people are concerned about where accounting is going I think what people really should be asking themselves is, you know, what, what am I doing today to add value and are the changes that are coming and whether it be automation or you know, other changes to the accounting field. Are they replacing the role that I do or, or, or are they going to emphasize the impact that I'm having on my business? Because if it's simply replacing the role and replacing the responsibilities, that one has an accompany. I think that begs a better question about whether or not one is utilizing their skills and utilizing the abilities that they have for the business. And if it's more of how is it going to change my role within the company, I think that's a better question for us to say. How can we eliminate non value added tasks? How can we eliminate inefficiencies within our own jobs to increase what we are doing and the information we are providing overall to, to our companies, to the business world, to whoever our ultimate state quarter's stake holders are that we, that we support.Mitch Roshong: (04:12) And how about the overall scope of the profession? How are these impacts, you know, not just changing the role of the accountant and the way the finance function operates, but what kind of changes do you see the finance professionals realizing with the relationships with non-finance functions across the organization?Kaiser Mock: (04:36) Yeah. You know, I think it's funny because a lot of times, at least for myself, and I'm sure a lot of the listeners can relate to this, when you tell people that you work in finance, or you work in accounting or whatever it may be, you'll typically get a response for individuals outside of the profession that say, Oh, I couldn't, I couldn't ever do that. I'm not good with numbers. I'm not good with math. And to me that completely misses the point of what we do or what we should be doing. Because, you know, we get the stereotype of number crunchers, whatever that may be. But really what we're doing is we are storytellers and we are individuals that analyze information and convey that to our stakeholders, whether it's within the finance industry or outside of it, at our businesses that help them better understand what is going on and help them make better strategic decisions. So what I look at, the changes in the industry are ones that if we are truly, truly doing what our roles are and truly you know, as I said earlier, maximizing what our potential is. And what our skill set is, all that that does is it creates a better relationship with individuals that might not be accounting or finance per se, because it allows us to spend more time on the analytical, allows us to understand better about what is going on within, within our, our roles so that that information can be more useful to, to the outside world. You know, as an example, even here at my business, I work at MillerCoors here in Golden, Colorado. When I'm able to eliminate the need to run reports manually or to manipulate reports, what that does is it allows me to convey information to individuals here at the brewery about what exactly is going on in their field and whether it is helping them understand labor variance reports. So instead of spending hours computing it myself, I can simply have a report produced for me that I can then analyze and give them information or maintenance spend. It's something that allows me to spend more time giving them useful information instead of just giving them data.Mitch Roshong: (06:52) Let's talk a little bit more about that because I'm kind of interested as you're putting together these variants reports and you have a lot of financial data but as you said, you're trying to communicate it to people who may not fully understand. How do you go about really telling the true story behind the numbers and making sure everyone in the organization understands exactly what it is that you're trying to add value to or improve?Kaiser Mock: (07:15) Yeah, I think one of the most important things for that process, and at least for myself, what I've found is it's kind of the idea of instead of taking a top down approach, taking a more of a bottom up approach. And what I mean by that is I find myself very frequently caught in the idea that okay, I have reports or I have information and I need to, I need to get this information out to other individuals. And then they are going to follow up with questions about what it looks like or what, what the information that I'm conveying means. And what I have found useful is to start from kind of start from zero, go to my stakeholders and ask them, what's the information that you're looking for? What is it that you are trying to accomplish with this report? And then more customize the information that I'm delivering to them so that it's actually useful. You know, for example I had an an issue recently when it came to maintenance spend here at the brewery. We have a, you know, maintenance team that they, they go out and make sure the plant is operating efficiently. And we had a report that we were running on a weekly and monthly basis to help them review where, where the money was going, where, where they were spending and we ran into consistently problems with how it was, how it was being delivered, the manner in which we were conveying that information to them not being useful. It was taken very much a a past look at items, a, a very a big time delay. And then not helping them understand where they were going as a department. And after recognizing some of those problems, what I did is I sat down with them and I said, regardless of what we've been doing, what is it that you want to accomplish with this report? And when we meet to do financial, for lack of better terms, financial deep dives, what, what does, what do you want to get out of that? How, how can it help you as a department make better decisions? How can it help you better steer and manage what you're, what you're trying to accomplish. And so we redeveloped the report to put an emphasis on forecasting and look at where we expect future spend to be and then also deliver the information so that they could analyze past trends a lot easier. And what that did is it's now allowed them to take, instead of just a, a managing past approach to saying, okay, this is what we've done as a department and this is where we know we're going. So these are the steps that we can take today to manage months and years down the road so that we know that we are going to be successful in the short and the long term. And I think that's something that's really important for listeners and for individuals in the accounting and finance field is to realize that we are here to support other individuals. We, you know, even even accounting firms, the ultimate goal here, right, is not to necessarily do accounting, it's to support the business purpose. And if all we are doing is pushing accounting or pushing reports or pushing data that doesn't necessarily add that value and add the the, the skill set that I guess that businesses are looking from us. So it's really about, instead of saying, how can I do my job better? It's how can I support individuals better? How can I make sure that what I'm doing accomplishes the tasks and the expectations that the team, that others that I support have of me and allowed them to do their job in a more efficient manner.Mitch Roshong: (10:42) And what would you say these accounting and finance professionals can do in order to put themselves in that mindset? In other words, how can they start to prepare for this kind of shift in value added to the organization as opposed to just themselves in their individual roles?Kaiser Mock: (11:00) Yeah, yeah. I would say the biggest thing that everybody needs to ask themselves regardless of what role they're in is the why. I think what we get so caught up on is we always ask ourselves "how"? We look at the technical side. We look at how to, you know, whether it be concepts and accounting or whatever it may be. We look at the how instead of understanding the "why" of it. Because if we are talking to someone that is outside of finance and whether for, for myself it's working with individuals within the brewery, but if it's regardless of what it is, ask yourselves why do they care about what I'm doing and then you need to ask yourself, what is it that I am trying to accomplish within my role? What I have done is I have made it a point for myself to get outside of my, my area and learn the perspective of the individuals that I am supporting and what they're looking at on a daily basis. So here in the brewery, what I'll do is I'll go out and I'll walk with individuals in the brewhouse and I'll say, what is it that you're looking at when you are, you know, when you're brewing beer? How are, how are you looking at what I would see as cost of goods sold? But you're seen as raw material handling that you do on a daily basis? I go out and I, I help walk the lines. And if we see product loss, you know, it represents a physical loss, that's numbers to me. But to them, you know, they're seeing it as a mechanical issue. So trying to understand what they're looking at. And then I tie that back to my own role and my own the, the numbers and the finance that I see on a daily basis. And I think what that does is it gives me the perspective of not seeing it as an accountant or not seeing it as a finance individual, but seeing it as a member of the team and a member of the business that I've worked for. And that allows me to really be able to convey information, do my job more efficiently, but again, support individuals that are outside the finance world, but within the business that need the information that I'm providing to them.Mitch Roshong: (13:13) And to kind of wrap things up here, I guess overall your role in supporting the business, and obviously you work with a lot of different functions across your organization in the brewery. How do you see your individual role potentially evolving even more as the accounting and finance field continues to grow and evolve in the future?Kaiser Mock: (13:34) Mmhm. Yeah, you know, our, my situation might be a little bit unique. I'm working a heavy, obviously manufacturing area and I get to sit at the manufacturing site. And so my, my role is very much integrated with the operations team. Whether it is folks that are literally out on the brewery floor and, and running the machines to the maintenance team to individuals that might be sitting in a corporate office but are still responsible for managing costs. So I get to touch a lot of different areas but be very interactive with that, with that group. And I can tell you that one big push that we are having as a company and that I think a successful companies would do is looking at ways in which we ourselves as as non-operations individuals can help drive better conversations and help drive change that we might see coming through in a financial perspective or a data perspective. And taking that literally out onto the operation side and operations floor to help drive what we see as as needed change. And I think that as the accounting field and finance field evolves, what we will see in what will truly make individuals and listeners successful in their roles is the ability to, instead of being, like we've talked about at the beginning the number, contribute being someone that drives change. So if we're talking about telling a story and helping develop that, it's looking at data, looking at potential issues that we would see. And then developing those relationships with the folks that you support to help kind of drive that change and drive development in areas that, that we know needs to happen. All the time. All the time. In my role right now, I see issues big and small that, that come across my desk and in, in a variety of forms. And while I don't have, I don't have the authority, you know, I'm not a manager, I'm not someone that, that controls the entire operations here. What I can do is I can help steer conversations into the directions that I know need to need to change. So for example one of the things that we track here at the brewery is alcohol loss. And we know that when we start out at the very beginning of the process to brew beer, we have a certain amount of malts, certain amount of adjuncts that are ingredients that we know at the very end should create X number of barrels of beer and alcohol. Well, there's a lot that can go wrong and a lot that can change in that process. And part of my responsibility as even a finance individual is to help, is to compute what that loss is on a weekly and monthly basis. What I can do with that report is I can say, well, I know that we're losing this much money, but take it a step further and say, what can we change about that? Where can we focus to help change where the direction that we're going in? And that's something that I've taken upon myself to, to look at and say, you know, I can talk to the financials, I can talk to what the numbers are, but I can't necessarily impact what the brewery is doing. Let me reach out to the individuals in the context that it made it. And those relationships that I've built up with the folks that are in operations to help them drive change where I think it is needed so that the financials and the reports will look better on the other end. And I think that's the, that's the kind of message that I would, I would convey to, to listeners today is you have to develop those relationships. You have to be able to have those kinds of conversations and that kind of a mindset so that while you might not be the one that is changing the way your business works, or maybe not changing the way that things are done at your company, you can, you can play the role of the individual that steers the change and steers the direction of your company that will make it stronger. And that's how you're going to deliver the most value as a financial professional and deliver the most value to, to any business that you support or may work in.Announcer: (17:39) This has been "Count Me In", IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Dr. Sean Stein Smith:LinkedIn - https://www.linkedin.com/in/dr-sean-stein-smith-dba-cpa-63307444/FULL EPISODE TRANSCRIPTMusic: (00:00)                   Mitch Roshong: (00:05) Hey everybody. Welcome back to IMA's podcast, "Count Me In". I'm your host, Mitch Roshong and I'm joined by my regular co-host, Adam Larson. Today we are going to listen to another bonus episode as we hear the remainder of the conversation we had with Dr. Sean Stein Smith. Adam, you and I both asked Sean a variety of questions about the impact of various technologies on accounting and finance. What are some of the takeaways you had from what Sean had to offer?Adam Larson: (00:32) Sean had a lot to share with us. If you recall, Sean recently received the New Jersey society of CPAs, 2019 ovation award in innovation and as an expert in technology, blockchain and data analytics. Throughout our conversation he discussed how the role of the management accountant has changed because of technology, talked to us about global business opportunities, referenced some cybersecurity issues, and even made some future predictions for us. Without giving too much away, let's listen to the rest of our conversation.Music: (00:32)                   Adam Larson: (00:59) You are clearly well versed in the emergence of technologies in accounting and have had great exposure to how they've made an impact on the industry. So I'm curious from your personal experience, how have blockchain, AI, RPA, and anything else you've come across begun to change the role of the management accountant and the accounting profession?Dr. Stein Smith: (01:25) So, I'd say probably the biggest, biggest change that I've seen is that really all of us have been talking for years on how to transform ourselves to be a business partner or a trusted advisor. Right? And that really now these tools and these processes are actually here to help us do that. Right? Because a audit is, is great, right? It's the core of how companies publish data out to the marketplace. Tax returns are important from a compliance point of view and all the rest. But really those don't add too much value to firms on a ongoing basis. I would, I would challenge you to find a CFO or a board who would argue that their audit team adds actual value going forward. Now again, the audit function and the tax function are cornerstones of what we do. But our true, I think future is to be more forward looking and to be those business advisers. Right? Right. Cause who knows data better than we do. Nobody. Now there are a whole bunch of of new firms out there, new job roles out there, data science, data analysis, all the rest. But all of those fields and firms and individuals lack the foundational knowledge that all of us have on how a company actually works, right? From a financial point of view and they operational point of view, right? Operations, drive, finance, drive data, and then all of that drives to forward-looking choices. And so that's where I've seen that that shift and that transition happen, right? From a compliance or, or a backward looking role or a team or a firm to a to a forward looking field and a team and the individuals working there. Every conference that I go to, every article that I read, every, every book I pick up, podcast, a webinar, all the rest -- This, this whole conversation on all of these tools, right, are just that tools, right? And it's up to us to be able to understand those tools. You'll harness the power of these tools and then most importantly do something with them, right? Because knowledge is is fantastic, but the application of that knowledge is even better. And so that's really where I've seen people in firms really, I mean grow exponentially, right? Individuals who are able to be proactive to humble themselves that you learn new tools, ideas and concepts and, and to then take the time to think, to analyze and to then point out where these new tools and ideas can actually be be put to use. And, and that's really the overall message that I have and the overall theme I've seen, right? You can be a CPA, CMA, any, any of of the alphabet soup, right? But it's that idea of, of harnessing these tools finally, right? The tools and the processes are our, at our hands to help us sort of transition from always having to focus on just doing the work, getting it done and having it out the door to having those tools automate parts of that work for us. And then that frees us up to be able to actually talk to our clients, offer them advice, to help them better understand how their firms are actually doing, and then help them take that understanding and then chart a better course forward. And that's really the, the key value. And it can be AI, it can be RPA, can be blockchain and I'm sure in five years there'll be some new buzz words out there, right? But, but it's that underlying theme, right, that our roles are changing, our jobs are changing and our field is already changing and that it is changing for the better, right? There's always going to be some anxiety and, and angst out there, but it's important to really take a step back to analyze what's happening, to be able to understand which trends are, are coming anyway, like automation technology overall, and to then harness those trends, right? To understand them, to learn them and to then take those to specific processes both inside your firm and outside your firm, have those conversations at both places and then use those conversations as a springboard or as a jumping off point to really help you in your firm evolve transition, have a better handle on your data and current processes and then that frees you up to focus on new business opportunities going forward.Adam Larson: (05:53) As far as news business opportunities in the expansion of transactional, how do you think these emerging technologies fit into the global business economy?Dr. Stein Smith: (06:02) On a global scale, I mean we're probably in the first in it, right? The first day and first quarter, first, first pitch tip off, whatever analogy works best, right? And we are just at the very beginning of this transition and it's important to to also note that that our conversation here as comprehensive as it is talking on AI, RPA and on blockchain is only about this much of a much broader change going on, right? Companies are going digital all, all across the world and to that data is really where all of that power is going to be going forward, right? Because the power and the information and the business opportunities are in that data, right? There are all kinds of opportunities out there for firms who are able to, to really analyze that data, go through it, find it patterns, and to then use those patterns to then see opportunities going forward in the marketplace. Now, hedge fund and PE firms have been doing this for years, right? You're mining information to build out trading patterns and all the rest, but now those exact same tools are out there in the marketplace for us as accounting people, to actually use ourselves, right? And to be able to help us analyze it, that data, and I always come back to that data, right? Because companies are built on, driven by and are governed by the information both, both produced internally and then gathered externally. And so we are people who understand data right? At the core of our work and our education, we are people who understand information. And so all of these tools, both in the accounting space and on a global, so the international basis, those are helping us get a better handle on that data to go through it faster, to analyze it more efficiently and then turn that data into actual business ideas to push forward. I mean, so I'd say we haven't even seen like the first 10% of the impact of these tools on a global basis. Right? And, and also don't forget, just, uh, hanging out here, uh, down the street is, is that whole shift towards 5g. So all of that is going to only amplify all of these trends, right? All of the transmission of data that's going to supercharge everything being being analyzed now. So it's really gonna be interesting over the next 10, 20, 25 years to see how all of these trends shape the global economy. But I'd say really it's going to have a profound impact on every industry and every industry is going to have to adapt, educate, and then keep learning to actually move forward.Adam Larson: (08:47) So then how do you predict these technologies will continue to evolve and further change? The accounting profession on a global scale, what is your five to 10 year forecast?Dr. Stein Smith: (08:57) The forecast that I have is probably within five years we aren't going to be talking about blockchain anymore because blockchain is is um, going to be part of business, right? There are teams right now in all of the big accounting software firms that are actually working on how to build some characteristics of blockchain into their current software, right. On the backend. But, but us as end users aren't going to see that. And then I'd say really the whole themes of AI and RPA, that's really gonna unlock a lot of opportunities that are hard to even imagine now. Right. Because again, sort of echoing back to our earlier conversation on the personalized and the customized services that all of us are, are, are getting, whether it's Netflix, it can be Spotify, it could be Amazon, Whole Foods, every aspect of our lives is increasingly becoming automated, customized and personalized. That's, that's only going to get more and more forceful going forward. And I do think that's going to unlock a lot of opportunities for firms who are able to harness all of that personal data and to then create better services off of that. But my last sort of forecast going forward is that this whole data dump almost, right? All of this information being produced, transmitted and stored on a international basis is going to cause some, some pushback, right? From the oversight bodies, be it the EU pushing out GDPR in May of 2018 be it other sort of regulations in, in, in other markets there is going to be that. So it's going to be interesting to see that sort of push and pull between the information being leveraged as a business tool and then the conversation on who actually owns our information. Right? Who has control over that information? And if I don't want a firm to have that data, is that even possible? Right. So it is gonna be very interesting over the next two, three, five, 10 years. But I do think those two forces, right? The force of more data being published and shared and transmitted and and sort of forming the business model of organizations and that push back almost right from consumers and from oversight bodies. Those are, I think, shaping up to be two of the dominant forces going forward.Mitch Roshong: (11:18) We have previously provided a lot of valuable information pertaining to blockchain, AI and RPA, but I'm sure people still have questions. What are some of the frequently asked questions you field from accountants as they try to implement these emerging technologies?Dr. Stein Smith: (11:34) Excellent question. Probably the, the top question that, that I hear via, you know, the any group, right? Whether it's a CPA audience, CMA audience, corporate finance audience, probably the, the top issue or concern I that I hear quite a bit is, is all, all of these automation tools going to make me get out of a job, right? I mean, are all this automation and tools and blockchain, AI, RPA automation, is all of that going to make us obsolete? And the answer is no. I'll come back to that though. Okay. All right. So I'd say that, that, that's the first one. And then part two is how do I get started with all this stuff, right? Because all of us hear, uh, blockchain, AI, RPA, all of these emerging terminologies and tools on an almost daily basis, but a, but a top question I get is also sort of, okay, great, but so now I've, I've heard of them and I'm interested in it. How do I get started? And then the third question that I hear quite a bit to sort of round this out is then, great. So I am confident that I'm going to have a job. I'm interested in actually being engaged in this learning process. Then part three, um, how do I start actually doing it inside of, of my firm? Okay. So the first question, are all of these who's going to make us obsolete? No. Right, right. Cause as all of us know, right, any it system or controlled or any computer system is only as good as the people who are in charge of it, right? And it can be automation, it can be blockchain, it can be anything. But if those underlying controls and those people who are actually using that system aren't well informed, aren't trained, aren't educated, aren't keeping themselves up to date on these tools, it isn't going to work. So, so point 1 and then, point #2 is that great, all of this data is crunched and analyzed and then put into dashboards. Fantastic. But it is up to us to then analyze that information, interpret that information, and then communicate that information to our colleagues, our managers, our partners, MDs, and our external clients, right? So our role is going to change, absolutely full-stop. Those, those manual, you know, base level tasks, bank recs, account recs, confirmations, counts of actual inventory, all of those are going to gradually go away or at the very least to be augmented heavily by these new tools. That's great. I never liked doing them. So I'm ecstatic about that. So our role is, is they're going to change more from sort of data cruncher, like head down, working away to a data interpreter and then actually being able to offer guidance going forward, right? To our partners, our colleagues, and our external clients. And that forward-looking advice and guidance is actually what the value is. So then how do we get started, right? Learning about all of these tools and platforms and there are a whole host of options out there. The IMA has a very comprehensive catalog of courses both online in person at their annual conference all across the board on pretty much any topic possible. Right? So, and then outside of that though, uh, there are a whole host of options out there, right? It can be the Khan Academy, MOOCs, massively online open courses. All of these options out there that are, uh, that are usually a combination of a joint venture with an online educational platform and an institution of, of higher education, right? And so these courses range from introductory levels all the way up to actual programming or using AI tools, blockchain platforms, all the rest. So there are a ton of courses out there. There are more courses out there, then it's possible to actually take, right? So then it's really up to us to go through and to pick out which courses, which topics, which methods of learning are best for us going forward. And then point number three, how do we actually get this stuff going on inside of our firm, right? Cause all of us know that automation is coming, blockchain is coming, AI is coming, right? How do we actually keep pace with this and then have this actually inside of our firm so that we as a firm and as an individual can be forward looking and then proactive, right? Probably the best step to actually get that started is to have a conversation inside your firm, right? You know, bring it up, talk about it. Right. Cause right now there are a whole bunch of people in the accounting space that are anxious, right? Because there's all of this talk of blockchain, artificial intelligence, RPA, and all of that is, is is going to automate big chunks of the work currently done, right? But it's important to have these conversations to have these productive conversations as to where these tools fit in the process. Right? Because right now there are very few firms out there that are actually ready to automate everything, even if they want to. Right? And so that whole process of going through, you know, documenting your current processes, building out controls, both current controls and then the controls that are going to need to going forward. And then three, uh, being able to analyze and interpret that end result of that information are going to be core competencies and traits that anybody working in accounting is going to have to have going forward. So I mean those, those are the top questions I get. Obviously there are a whole bunch more out there, but probably the key, the key takeaway point I would stress is to not be anxious. It's to educate yourself on an ongoing basis and to three have these conversations inside the firm, right? You talked to your, your peers, colleagues, managers, and your clients on these topics, right? Cause all of us know that all these topics are coming. So it's, so it's up to us to be proactive, to be forward looking and to then figure out how to weave these into our firms.Mitch Roshong: (17:38) Great solutions and excellent examples. Thank you. But what if you are a small to midsize business and some of these options just may not be feasible? How do you recommend weaving your suggestions into those businesses implementation strategies?Dr. Stein Smith: (17:52) The great part about tools like this, right about automation tools, AI tools, all of these types of topics is that with almost no exception, there are price points for every firm, right? There are options packages for almost any size firm out there. But on top of that, and actually prior to that, right, prior to actually buying any software packages, if you're a SME, right? Take advantage of all of the modules and the power in your current ERP systems, right? Cause almost every ERP package out there, be it QuickBooks, Sage, Zero, any of those packages used by SMEs have traits for automation and the ability to automate processes and to turn that automated data into dashboards. So, so from an SME point of view, I'd say focus on maximizing, you're current tools now and then two, I mean there are price options and points for a firm of any size and any budget out there.Mitch Roshong: (18:55) Okay. Sean, so now that we've looked at some of these potential uses for technology, I think it's important to address the cybersecurity issues. What do accountants need to be aware of when it comes to technology?Dr. Stein Smith: (19:06) Excellent question, right? Because there's almost this idea out here in the accounting space that as these tools are you moving right out of the fringe and into the mainstream, that internal controls and control over data aren't going to be as important going forward. That is completely false, right? The idea of a good cybersecurity policy is even more important now as all of this automation comes into this space, and I do want to focus on that as the core piece, right? Because automation is pretty much at the core of all of these ideas, right? Be it RPA, be it AI, even on a blockchain basis. A big upside of these tools is that automation aspect of it, that, that then as data is, is automated, it's, it is standardized, it's able to be processed more rapidly and processed on a continuous basis and all of that is fantastic. But if our internal controls are not up to par or aren't evolve in to, to keep pace with these changes on every other aspect of how data is treated, it is going to be a issue going forward. Right. So probably some of the top issues or the top items that, that, that I would always emphasize from a uh, security point of view is to, one, always make sure that you as a firm understand who has access to your information. And it sounds pretty obvious, but if you're onboarding tools like RPA, AI, blockchain, all the rest, you are going to be hiring external consultants, right? And so what level of access do those firms have to your information? It would be like hiring a external engineering firm to help you build out product, right? You would want to make sure that you had complete control over what data they had access to. That exact same idea is applicable here, right? That as you're building out these, these new systems and processes that you as a firm do understand who has access to what information both now and on a going forward basis right through a back door or through a patch to come in to actually fix issues as they pop up. Two one of the controls over that data, right? Because it's awfully easy to just automate processes, right? And to enter then trust the computer or that your black box idea, right? But having good controls both on the input side and on the output side are even more important, right? Because if that data is being processed and analyzed in sort of this black box, right? The sort of magic box that then does all of this cool stuff, it's really on us to make sure that then as that data comes out in a pie chart or graph a dashboard, uh, anything else, that we as the accounting team understand that information and are able to actually go back and to trace back to see how that data actually got transformed, right? So those controls are imperative. And then three, sort of a issue that is an issue that is not talked about too much but should be, is the issue of insurance, right? And the idea of insurance and an idea of a governance policy over how data is shared and transmitted between different firms. And I'm only bringing this up because as you know, Facebook and Google and Twitter had been hauled down before Congress. Obviously the whole idea of companies having huge amounts of consumer data is a hot topic, right? And every firm has, uh, information on consumers. Even firms working in accounting and finance have credit card scores, payment histories, addresses, all kinds of information that is identifiable. And so having a good insurance policy over these vast troves of data that cause hacking happens constantly be it JP Morgan, be it the Marriott target home Depot on and on and on. All of these companies are hacked and then after those hacks have occurred, then it's the floodgates of you know, dollars to help sort of patch these holes. It's a lot easier to be proactive and to get out in front of these issues to make sure that you have coverage and that more importantly I think that you have a policy in place inside the company to make sure that the data of your customers is treated as if it was any other asset because it is. And so all of these themes and topics sort of wrap up right into two points. One, our role as corporate accountants, corporate finance folks going forward and the expectations of our clients, right? So we are going to have to change and evolve again based on that automation trend, right? That is coming from every which side, right? We are going to have to get better at understanding how these automation processes work and then how that data comes into those black boxes or those automation tools and then is exported back out to us, right? The, the controls and then how that actually works are going to be things that we're going to have to know about. And then as far as a sort of external, sort of a client facing role, we are going to have to be able to explain these things to our clients, right? Cause our clients have expectations because in every other aspect of their life, be it personal life with their Siri, Alexa, Google home, Netflix, Teslas, it's a whole personalized, customized lifestyle. And so our clients are going to have that expectation of us and our services going forward. So it's really going to be honest to be able to meet those, uh, expectations if possible. And if we aren't able to actually meet all of them now, to be able to walk them through, why not and then our plan to get there. So really the whole issue of a governance policy or of a policy over the integrity of data is one that is being talked about at the periphery, but I believe really should be at the core of this whole technology topic. And this whole conversation.Announcer: (25:25) This has been "Count Me In", IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Brian's Work: https://www.apqc.org/resource-library/resource-listing/how-cfos-forecast-and-plan-future https://www.apqc.org/resource-library/resource-listing/challenges-and-opportunities-financial-planning-and-analysis-fpa https://www.apqc.org/resource-library/resource-listing/transformation-financial-planning-and-analysis-fpa https://www.digitalistmag.com/finance/2018/05/01/finance-transformation-how-organizations-can-adapt-to-change-06143131 https://info.sapdigital.com/1650_IFPA-CFO-White-Paper_OAP.html Contact Brian:LinkedIn - http://bit.ly/2hoZavsTwitter - @FpandaBTK FULL EPISODE TRANSCRIPTMusic: (00:04)Adam Larson: (00:05) Welcome to “Count Me In”. Thanks for coming back and listening to another engaging and insightful accounting conversation with us here at IMA. I am Adam Larson and I think you're really going to enjoy today's episode, as, in a minute we will listen to my co-host Mitch Roshong talk with Principal and Founder of Kalish Consulting, Brian Kalish. At the end, please take a moment and write a review and let us know what you think. Tell us how we're doing and what you think about the series either on this episode or by sending us a message with some feedback. So as I understand it, the theme of your conversation, Mitch, was why and how FP&A should embrace big data and technology. Tell us a little bit about Brian and some of his interesting points.Mitch Roshong: (00:46) Sure thing. Brian is an avid baseball fan, a history buff, and an extremely successful FP&A, a professional. For our conversation. He was able to explain how the emergence of big data is an asset to financial planning and analysis and that technology is not necessarily disruptive. One of my favorite quotes from the conversation was, the science of today is merely the technology of tomorrow. And Brian does an excellent job shaping the conversation around the opportunities created in FP&A. This was a really well rounded and interesting discussion. So let's listen now.Music: (01:26)Mitch Roshong: (01:28) Brian, what kind of impact have you seen big data have on FP&A?.Brian Kalish: (01:33) Well, I'd say Mitchell off the bed. You know, my, my gut answer is a huge impact. You know, in FP&A, we're really in the process of developing an analytics based culture of data driven decision making. And certainly utilizing big data is one of the components of that evolution. It's just incredible the amount of data that just exists today. I always like learning new things. And one of the things that I've learned recently is that we are now operating in a world of Bronto. So B-R-O-N-T-O-B-Y-T-E-S bytes of data, which is 10 to the 27th power. So, you know, we're now just, you know, given all the conductivity that that just exists in the world today. We just have so much data available to us. And what's, you know, kind of what's really changed is that we now have tools and infrastructure that permit us to actually analyze all this data in a useful, timely and, and cost efficient way. And so if you think about what the whole purpose of FP&A is, which is to help the organization make better, faster, smarter decisions, big data really flows into that. So as organizations begin to utilize big data, what's important from my perspective is really kind of the persona that FP&A has within the organization. So for most FP&A groups, you know, the aspiration is the move from being a reporter to a commentator, to an advisor. And I'd say kind of at a truly visionary standpoint becoming a strategist and why this matters and how big data plays into it is it really can help us answer the questions that the organization has for us. So whether you're at the corporate level, you're embedded in a business unit you're helping marketing or HR by utilizing big data, we can move from just answering the question of what happened to where did it happen. And then where it really becomes important is why did it happen, what might happen? And again, kind of at that top level is, you know, having the impact to actually make something happen. So you're looking at another way of dictated will move us up the maturity curve from just providing hindsight to what I hear most business partners asked for today, which is insight and I, you know, I'm a little bit further out the curve. I really think FP&A can actually begin providing foresight to the organization. So if you think about the level of analytics that we can use, you know, we can move from just providing descriptive to diagnostic to predictive and then ultimately to prescriptive. And certainly big data is one of the pieces that can help us get there.Mitch Roshong: (04:36) Sure. So as this big data flows into FP&A, and I love how you talked about the, the value maturity curve. As we kind of move along that curve, what are the challenges that are presented because of big data and the amount of it that you previously mentioned?Brian Kalish: (04:54) Sure. So, for me, I kind of have four pillars of what FP&A is built out of and they're certainly, you can always find challenges within any of the pillars. So, you know, what are we talking about as people, technology, process and culture. You know, you have to have a culture that wants to consume business new level of analytics. I was recently with an organization engaged with them and basically their management doesn't want it, like they're not interested in it. It's hard to implement it if you don't have a consumer. So you have to be in a proper culture that is willing to embrace it and utilize it and, you know, spend the resources to make it happen. But you also have your, you have to have the right processes in place because obviously as we're introducing new data sources, it's important to have from both a data governance perspective, but also from a decision making perspective. Do you have the proper governance in place? Do the people have the right skills? And then I think where we spend a lot of our time with big data is, is the technology. So it's great that we have access to this incredibly large database of structured and unstructured data, internal, external. But do we have the proper technology to do the analysis? And do we have systems that are actually powerful enough in place? I mean, these things all exist today. I mean, there are organizations that are certainly leveraging big data and utilizing even in artificial intelligence. But for individual organizations, do they have the proper technology in place? And one of the things that's I think has been fascinating is that we've really, and I'm not trying to get too wonky too soon but just the infrastructure, you know, we've been dealing with for the last 30 years, what's kind of known as an ETL, which is extract, transform load environment, which is, you know, data warehouses and we've very familiar with that. But what's really incredible, and I think what really poses a lot of tremendous opportunity is that we can now move to an ELT structure, which is extract, load and transform. And we don't have time to dive into it today. But basically by making that structural change, we can leverage big data in a much more timely and cost efficient manner. So really things that, you know, once seemed like magic or are truly possible today.Mitch Roshong: (07:22) In FP&A. How can individuals, you know, functions, organizations really embrace and take advantage of this big data that's available to them? How do they overcome the challenges and add value to the company?Brian Kalish: (07:36) Well, that's a great question, Mitchell. And part of it is, you know, typically you're just, no matter how large the organization may be or small, you know, it's very difficult to make enterprise wide changes. So what I advise people to do is to, you know, look for small wins and make small bets. And so one of the things I always challenge FP&A teams that I work with is think about it just a persistent business question that you haven't been able to answer and really think about the opportunity to leverage big data to do that. So again, kind of my advice is, you know, start small and simple, you know, look for that low hanging fruit. And regardless of the issue that we're talking about is look for a way that you can really bring the full fire power of big data into adding value. So whether it's a forecasting question, it's a data analysis process, you know, basically looking for a very simple, clear demonstrative way of saying because we're utilizing big data, we were able to answer this for you. And so I'm a huge baseball person. Probably I'm beyond fandom. And so, you know, my thing is, you know, you know, start hitting singles, right? Don't, don't go for the fences because as you start to incorporate utilizing big data into just the normal course of your analysis, people will see the success that you're having. And I'm a true believer that success begets success. And as you solve problems for people, as you answer their questions, they're going to continue to come back to you. And so what's you're able to do is start small and then kind of move up the complexity curve and then create more, you know, strategically actionable insights. And as your business partners become more and more engaged in what you're doing, you will become much more important to them. And that's kind of how you'll move from being the, that reporter to commentator to, to advisor.Mitch Roshong: (09:41) And that's just it. You know, in preparation for this call, I read up on some of the things that you've written and I noticed that you made the comment technology, like AI big data is not necessarily disruptive. And I think that kind of ties into what you were just saying about embracing change. And facing the fact that this stuff is here and it is part of the industry. So I just like to get your thoughts and kind of explain what you mean by this isn't disruptive technology.Brian Kalish: (10:12) Sure. And so and one of the pieces that I read that you may have seen, you know, you know, I don't know, maybe it's just a matter of semantics, but to me when you say something that's disruptive, that has a negative connotation to me. So it's something bad, right? You're disrupting, you know what I'm doing, you're disrupting my, my thought process, right? That that to me means something negative. So when we're saying by introducing this technology that's going to be disruptive to the business, my takeaway, again, it might merely be somantics. Is that something negative. To me, technology is something constructive. And so to me, constructive is a positive term. So when I hear it, I think was something good. So, you know, I'm an FP&A guy, I'm a baseball guy, but I'm also a history guy. If you'll indulge me for a moment, you know, 1946, ENIAC, which was the electronic numerator integrator and computer was created at the University of Pennsylvania. Certainly the world thought that was disruptive. I would say it was constructive. 1971 Intel introduced the 4,000 for microprocessor was it was introduced. Again, people would say that was disruptive. I would say constructive. You know, '85, first version of excel was released. Disruptive? Most people feel, you know, the way that life changed. It's interesting as I'm using these examples, it's like the word is change, disruptive or constructive as the adjective that we use to describe it. So, and then kind of getting to where we are today. Back in 2010, Microsoft you know, released Azure, which was the first cloud application, I would argue, constructive. And then today, in all honesty as this kind of progression has occurred. It's all about big data. So to me, when you look at all these changes, and that's not just, you know, we're just kind of talking about technology and finance, but if you think about just the world in general you know, technology is just new tools that come online that just help us do our jobs better or what I think is really important as these technological advances occur, they actually permit us to do activities and jobs that we just physically weren't capable of doing previously. So if you think about all the technology we've had in the past, all the changes that have occurred, all the jobs that have gone away, but all the new jobs that have been created, I mean, that's, you know, without trying to get too deep, too fast, that's, that's what we're talking about. So I always liked, you know, reading people that are much, much smarter than myself. So someone that I really enjoy is Edward Teller and one of the quotes that he has, I, I kind of use a lot, which is the science of today is merely the technology of tomorrow.Mitch Roshong: (12:52) I'm curious to get your perspective now on what your thoughts are on a, going back to your quote, what is the technology of tomorrow? Why is AI and all this stuff the future and how does that fit into FP&A and finance?Brian Kalish: (13:06) Sure. I mean, if we think about it again, because we're operating in a world of brontobytes, they're just not enough humans in spreadsheets, you know, to throw at the data and in this highly competitive very volatile world that we operate in, that we think we're going to get timely cost efficient and useful actionable information if we're not utilizing the new technologies that are down there. So whether it's RPA, robotic process automation, machine learning, you know, artificial intelligence you're not gonna survive, you know, you got you, you know, you certainly not going to thrive. And there's just too, from my perspective, what I see with organizations and I am, you know, I'm, I think I'm one of the luckiest people in the world. I get the opportunity to travel around the world and talk to organizations big and small across all different kinds of industries, corporate structure and you know, get to the beauty of sitting on this lovely hub of all of this data and, and hopefully sharing some of it with, with, with people like your audience today, but also clients that I have and, and try to explain to them kind of what you were just asking about. This isn't science fiction. I worked with organizations today that utilize artificial intelligence. I mean, it's simply the path that we're on. Again, probably Brian and his endless references. He's like, you know, if you're familiar with the terminator, we're, we're not at the point of turning Skynet on, you know, it's not the idea that we're turning over the business to the machines, but all the sudden we are adding an incredible resource that can just help us think about things we've never seen before. I mean, if you think about how humans operate, we are excellent at spotting trends that we're looking for. We are terrible at spotting trends we aren't looking for. And so something like artificial intelligence can take massive amounts of data. And we're not talking about just running scenarios, we're talking about running simulations. And again, just something that a human physically can't do and certainly can't do with a spreadsheet. Um and just give us not so much a unique answer, but giving us a range of the most probable outcome. And by having that information, and I would argue that's truly knowledge in place in front of us when we're making decisions, it just gives us something to bounce it off against. So for example pharmacy, excuse me, a pharmaceutical company that I'm working with, they have AI. So when they're looking at decisions, they run it through the model. It doesn't mean the model's right. But it gives them pause to think about if they come up with an answer that's different or strategy that's different. Why do we think that it would differ from what the model is coming out? And the beauty is that the, the model itself is a virtual cycle. So it's always being updated. So, you know, when we think about what, what artificial intelligence, you know, can, can truly deliver for the organization, I see its competitive advantage. Now as those organizations adopt sooner than others, and again, going back to my baseball analogy, it's not about winning all the games about winning more than your competitors. It's not about hitting the ball every time. It's about having a high batting average. That's what it's gonna really differentiate the winners from the losers going forward. I happen to be a person and I, I truly believe we live in a transformational time just because the way that we've done things or in the last 20 years is certainly not the way that we're going to be doing and going forward. And so, you know, for FP&A, I, I do think it's a very exciting time. You know, the opportunity to basically dive deep into analysis that just, you know, a short period of time ago it was physically impossible. I mean, we are now going to be able to model, forecast, plan, drive business decisions at speeds we just previously were unheard of. But again, let's take a step back and ok, people can get just completely enamored with technology. Also, technology is never the solution. It's just a tool. And so it's important to remember that we must be continually developing our people and to leverage these tools to their highest capacity.Announcer: (17:32) This has been, "Count Me In", IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Kirstie's Resources: Tax Transformation Guide - https://www.bdo.com/thought-leadership/tax-transformation-guide  Digital Transformation Survey - https://www.bdo.com/thought-leadership/digital-transformation-survey Insight First Innovation - https://www.bdo.com/insights/business-financial-advisory/strategy,-technology-transformation/insight-first-innovation  FULL EPISODE TRANSCRIPTAdam: (00:05) Hello and welcome back to another episode of Count Me In, IMA’s podcast about all things affecting the accounting and finance world. I'm your host, Adam Larson and today we're going to hear my cohost Mitch Roshong's conversation with the managing director in BDOs Chicago office, Kirstie Tiernan. First. As a reminder, if you're enjoying what you hear on, count me in, please make sure to subscribe, download rate and review all podcasts. Feel free to share your comments with us in the review section of the episodes or just send us an email now, Mitch, learning that Kristie has over 15 years of experience in data analytics and it advisory, what was she able to share during your conversation? Mitch: (00:43) Kirstie is a certified fraud examiner and an Oracle certified associate. She is experienced in managing fraud detection and prevention analysis projects and was able to share a lot of real life examples about some of her work with her clients. As you said, she has a strong background in IT, so she is a big proponent of researching and implementing technology to enhance various accounting services. We talked about how these advancements have improved the services she's able to provide as well as how it's changed the investigative work she needs to do with her clients. At the end of the conversation, Kirstie adds an intriguing prediction about what is next for the future of accounting. She's an engaging speaker and established and extremely successful professional. And someone I really enjoyed speaking with. Have a listen for yourself as we'll now go to the conversation. Mitch: (01:30) From your experience with digital forensics and eDiscovery services in the recent years, what kind of impact has this technology, the AIRPA had on fraud in the accounting industry? Kirstie: (01:50) Well, for forensic accountants in the increasing role of data that we have in business and in everyday of our lives and how much data is being created, that really just creates such a scope of potentially relevant evidence for investigations around and digital forensics need discovery. So I think the fact that the data is growing so exponentially so quickly, that's probably for forensic accountants, one of the biggest issues and one of the biggest impacts of technology is really had. With that though goes all of these new tools and all of these new ways and methodologies and using AI and machine learning, all these different things that we can utilize to call that data town. So where in the past for an eDiscovery project where we were looking at a lot more data, now we're using analytics, predictive coding, a lot of different tools to really narrow down on exactly what those relevant documents are and how we can review those most efficiently. So from my experience and going in digital forensics and you just go around that side, I'd say the impact that technology has really had been that and allowing us to review those very large sets of data very quickly and it's made it a little bit more difficult now that we have those tools for fraudsters to do the same old tricks. Right? So it, it does create a bit of a deterrent for the same fraud. You know, that's been created time and time again. However, with that also comes the risk that AI and some of these algorithms are allowing fraudsters to also develop their schemes. So it's technology, the impacted in both directions and we just hope that we can keep up, you know, with, with the way that the fraudsters are using it by detecting and quicker and using all these different new tools, statistic tools and analysis to really be able to identify these anomalies that are being created by fraudsters and new schemes. Mitch: (03:54) And how about with these tools, through your investigations, what kind of positive results have you recognized because of these different advancements and capabilities? In other words, what type of key business decisions or conclusions have you kind of been able to lead your clients to? Um, because of these accelerated processes. Kirstie: (04:13) So we have a lot of clients that maybe they know about a fraud that's going on and the typical issue is, okay, we're going to go investigate that. But our concern is what else is going on that we didn't know about? Right. And now we've got a ton of email data. We've got accounting system data, we've got POS data, we've got all this, this data that exists that we could search for where things could be happening that we're not even thinking about looking for yet. And so I think what AI has really allowed us to do is when a client comes to us and says, yeah, go investigate this, but what else is going on? We're now able to use those tools and that technology to go through those large sets of data. And so we have a, we had a client on too long ago where they came to us and that was this exact issue and they said what else could be going on? They said, just take a peek at the data and take a high level view of it somehow and tell us what else we should be looking at. So we ran a, through some of our, in an anomaly, we have a fraud detection algorithm we use and we look at it at the GL data. So the journal entry data by account. And we assess the risk by account using this algorithm. And what it's able to do is bubble up the top these transactions that look different than others, right? So you have all these transactions hitting revenue for instance, and then all of a sudden see something differently when you're talking about a client that has 10 million journal entries a month, it's impossible to run a round dollar analysis or show me all the payments on the weekends, that kind of stuff. To find this fraud, you need something bigger and something that can handle a lot more of the data sets that we're dealing with. So when we had that client come to us and give us three years of data and 2 million journal entries month, we were able to push it through that algorithm. The algorithm came back and it highlighted certain accounts of high risks year over year. And so we, what we did is we went back to the client and I said, okay, here are the top 10 high risk accounts that our tool is seeing. And one of the top one was a liquor tax and they had never had liquor tax in their review items. So that account kind of popped to the top and it was something that allowed us to further investigate, but something that they hadn't initially really reviewed in their typical internal audit process. Mitch: (06:36) And how about something that may not be fraud related? What are some of the positive results that you've been able to, you know, advise clients? Again, maybe something like process efficiency or you know, something where a tech has been able to just improve overall business functions. Kirstie: (06:54) Yeah, I'd say the biggest area for our clients right now is focused on tax transformation and tax automation. So within a lot of our clients tax teams, there's never enough people, right? There's always too much work. We had a client that came to us that said, Hey, you know, I've got 10 people on my team and I want them to be home at 5:00 PM I want them home on the weekends, but they're here every night til eight o'clock and they're here on the weekends. It's like I just want them to enjoy time with their family and I can't get that for them because there's too much work and I can't hire more people. So he said, my only, my only option is to consider automation. So we came in and when you walk into that room and you've got 10 people, he had his whole team of 10 people there and we were supposed to be brainstorming automation ideas that can be very intimidating for people that are going through that process. Right? Cause everyone thinks they're gonna lose their job because it's being automated. But I thought he did something really brilliant. He brought us in and he open up then the conversation to his team and said, I want to know today what about your job sucks? And when he presented it that way, people started thinking about that. And you know, there's not a lot of people out there who don't have one thing about their job that sucks, right? Everybody's got something that they do that takes time and that he would just love to hand off. And that's the kind of stuff we're trying to get to with automation. And especially in the tax world. There's so much of that reconciliation, you know, filing this, the sales and use tax returns online, things that are just very manual and very repetitive. And I think we have to get over the fear of being automated and if we're able to present it in a way like he did saying, I want to make your life better. I want to take these things off your plate that you don't want to do anyway, that really helps the team accepted and understand it and welcome it. Mitch: (08:48) With all of this technology and AI, all these possible improvements. For you personally, what has been the interesting part of your career or the most rewarding maybe project that you've worked on? How do you truly appreciate this technology and what you do every day? Kirstie: (09:05) I think for me what I've realized is, you know, you come out of school thinking you're going to have these skill sets and you're going to use those forever. And, and that is so not true in this world, right? Like the things that we would have talked about two months ago are, are completely different than today. So it is just ever changing. And some of the skillsets that we look for now versus previously are just so different. And so I'd say just the amount of change that you'd have to adapt to it and get good at. Right. So now when we interview people, we don't interview them for specific database skills or programming skills. We have to understand that that person is able to adapt to change. They have to be quick learners, they have to be able to self-learn. Right. We have a lot of remote. Our entire environment for our team is remote. So everybody has to be very self-motivated, has to do their own training. And it's, I think that's a really important part of, at least what I seen in my career of, from what I expected initially. There's a lot of get out there, understand it, keep on it, and it's changing every day. So it's a never ending learning process, which I really enjoy. And so that, it really works for me. And I love, you know, finding new technologies, finding new AI tools to be able to take those and help pilot to our clients. We had a manufacturer, a long time manufacturing clients of ours that I work with on a regular basis and one of their issues is that they have a lot of people walking around their warehouse identifying empty spots in the warehouse. And that's a pretty common issue, right? So there's always somebody doing that. One of the things that we're exploring now with them is using drones to do that. So it's, you know, I'm not sure that it would've thought five years ago, that's what I would be talking with clients about. But that kind of thing, really exploring the leading edge emerging tech. That's, that's really exciting to me. Mitch: (11:04) And what advice do you have for the future accountants? So maybe it's somebody who's already in the accounting field but needs to adapt to these changes. Maybe it's a student how do you recommend or what do you recommend as far as the learning that you referenced and in developing the skills that you are currently seeking so that as these people, you know, grow through the industry, you're more likely to bring them onto your team or something in a similar capacity. Kirstie: (11:29) It's hard to judge how someone's going to react to change on from a resume and an interview even. So I think the way to show how quick you are to adapt to new technologies and skill sets is to always be getting training in those areas. So for instance, right now, you know, robotic process automation is really popular. Data analytics. There's all of these different kind of areas of my world and technology within the accounting world that you can study and learn on your own. So when a resume comes to me and I see that someone's been learning UI path and they've got their certification, which costs $100, you know, that they can get that shows that I know that they're self motivated and that they can start to seek out these technologies and they can be on the edge of this because that's never going to end in their career. They're always going to have to be thinking about that. They're always going to have to be training on something new. So I really look for people that are self motivated, on self-taught, and are really trying out a lot of the different tools that we're seeing in the market today. Mitch: (12:35) And I guess my last question for you, with these new tools in the market and this changing profession, really the role itself, what kind of a future projections or predictions do you think you may come across with clients and, and future projects? Uh, you know, you mentioned earlier you were a little surprised that drones were being used. So what else do you think you might be able to do within this accounting and finance field? Kirstie: (13:04) Sure. So I think, um, one of the things that I think people think is still pretty far off, but I think is definitely here and is augmented reality. And I've started, you know, we've been exploring all the different industries and clients that we may have. [inaudible] can use this and there are so many different opportunities for augmented reality. and I think that's going to be the next thing that kind of blows us away and how our clients are using that. I mean we see a lot of clients using it from a customer perspective. We have some clients are using like nonprofits that are using it to help donors understand let's say a surgical room they want to build for a hospital and they want a donor to donate to that. You know, rather than trying to get the donor to look at drawings, they instead use augmented reality to build out that environment and they walk that donor through the surgical center that they want to build. That's a much different way of raising money then, you know, the nonprofits have done in the past. So I think thinking through these kinds of things with our clients for in the past we've, we've been more focused on data analytics now it's a little bit more of what else digitally digital transformation wise can we help our clients understand and look at. And I think augmented reality is going to be a really big piece of that. Closing: (14:25) This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Mason Brady:https://www.linkedin.com/in/masonbrady/https://www.hgofarms.com/FULL EPISODE TRANSCRIPTMusic: (00:00) Mitch: (00:05) Welcome to Count Me In. If you're joining us for the first time and you're interested in staying up to date with the latest perspectives on all things accounting and finance, please make sure you subscribe to our series, download rate and review all your favorite episodes as we keep you informed on what the experts are saying in the industry. And this week's episode, my co host, here Adam talks with Mason Brady, director of finance and supply chain for homegrown organic farms out in California. Now, Adam, you talked a lot about the finance function in a smaller enterprise. What did Mason have to say about it? Adam: (00:38) You know, Mitch, his passion for finance and operational efficiencies truly came through as he shared some of his insight into how one can lead strategic initiatives for smaller companies. Just like homegrown organic farms. Mason is a CMA with a finance and entrepreneurship focus MBA. He has a motivating perspective on improving the finance function for smaller businesses. So let's hear about Mason's current role and some of the rewards and challenges he's most familiar with.Music: (01:02) Adam: (01:04) Mason, you currently serve as the director of finance and supply chain for homegrown organic farms. Can you tell us a little bit about the rewards and challenges of serving as a CFO or finance director for a small enterprise? Mason: (01:23) You know, it kind of goes hand in hand as a reward and a challenge, but it's just the idea that you wear a lot of hats. So you know, it, you go online and you look up what does the CFO do for, and oftentimes you get a response FOR what a CFO does for a large corporation. And that usually involves capital management and procuring capital for projects and expansion plans and growth for the company. And it also involves a flavor of investor relations and having relationships with banks, et cetera, et cetera. And so that is a part of my job, but I also directly oversee the accounting functions. I do have a controller, an accounting manager in place, but very much so. Still involved in the accounting and, and building standard operating procedures and I'm really involved in the operations of our business and the operations of our accounting department as well. And so while I am tasked with doing a particular settings that a CFO or finance director, and usually it's known for when you work for a small enterprise that's just a sliver or a fraction of the entire pie of what you do. And so you know finding capital and procuring capital for growth for our company, that makes up maybe 10% of my time, while FPA makes up anywhere from 15 20% of my time. Overseeing accounting makes up another 30% of my time. And then in addition, I oversee the quality control functions and the procurement functions of materials, of packaging materials for our company. And so, yeah, it's just overall, it's the idea that you wear a lot of hats, which it's a lot of fun and it's really rewarding because you really understand the business as a whole better. But it is a challenge in ensuring that you are delegating appropriately, that you're not creating a bottleneck that you yourself are not becoming a bottleneck and ensuring that you're, you know, the operations of your business can flows smoothly without you having to be involved in absolutely everything or habit saying everything. And so yeah, it's finding that appropriate balance between the idea that you really get to see what's happening in your business. And so you can guide your accounting and your financing functions to ensure that they're meeting the needs of the business appropriately. But you really have to learn how to delegate and balance things as well. Adam: (03:47) So what comes with the oversight of accounting and FP&A in your organization? Mason: (03:52) Well you know a regular week looks like I have an accounting meeting with both my controller and accounting manager. Our County manager handles the AP and the grower accounting and then our controller you know, kind of, he provides a, we really have a part-time controller and he provides a higher level financial reporting perspective. And then also oversees our AR and our invoicing. And so the oversight there is really me engaging with them in those weekly meetings and reviewing our financials as a team together and ensuring that I'm able to spot out things or I'm able to ask questions and see how things are going and identifying where we may need a revised procedure and working with them directly to ultimately go implement a revised procedure. So if there is something related to AR invoicing, I would work, you know directly with my controller and go, you know, talk through what I understand and what they understand and try to come up with a common solution or, you know, I work with our accounting manager and talk to our AP and say, Hey, you know, how we're going with this. It doesn't seem to, it doesn't seem to align properly with the cruel standards. Maybe, maybe we need to make an adjustment like this and try to find the, a more simple way to do it. And so that's really what the oversight of accounting looks like. On the other hand, FP&A FP&A really resides in me And I, it's just the, it's just the fact that I have to you know, control the budgeting. I'm in charge of the forecasting, but I'm really the one with the financial modeling Excel skills to do that. And yeah, those are skills that, especially in a small enterprise are difficult to hire because you do have to pay good amounts of dollars for people who do have those skills in within small enterprises. That may not be something you can necessarily find the budget for. And so those functions really reside in me and really working directly with our CEO to provide forecasts and budgets as necessary. But I'm really pulling the data from our accounting team and our controller accounting manager and making sure that we all agree that what is being presented and in the financial reports looks appropriate. So then I can use that information and then forecast with it. So, in a way it's nice because from an FP&A perspective, I have my hand in the accounting, so I really no how to forecast something appropriately because I really understand the transaction. But I, yeah, I wish I could say that there's an oversight of FP&A, but really it's just me doing FP&A and well I do have a project coordinator that does handle a lot of KPI dashboards, produces a lot of KPI dashboards for me. It's still very much so me guiding that function me saying this is, this is how we're going to do it. And then laying out the plan of how we're going to do it. Adam: (06:45) That's great. That's a great kind of description of where you are. You know, so you were mentioning, you know, budgets and getting the right people involved. You know, a common story we hear is that small businesses can't take advantage of emerging technologies and software advancements because of their budgets. So what is your experience been with that? And do you have any best practices you can share to overcome the troubles with software design and implementation? Mason: (07:10) Oh, man. Yeah, this is probably the toughest question I have. It's, you know, it's very hard to replace the functionality and the flexibility of Excel. And I suggest whether somebody is in a smaller enterprise or in a larger enterprise, be cautious thinking that something is going to beat out Excel because you are going to be able to do many, many things with Excel. And so you know, and I think a lot of folks and because they don't have a full user understanding of Excel, they want to upgrade. And I really think a lot of companies are thinking from a perspective that well, if they don't want to take the time to really learn the full functionality of Excel and they want something that is a little bit more user friendly where somebody doesn't have to have a coding background or you know, understand BBA or macros or whatever the case is, that they really, they don't want it, you know, and they don't have the time to fill in those things. They don't want to make the time to go learn those things. And so they're looking for out of the box solutions. But yeah, you're really going to struggle to find something that fits every business model that I think that there's a lot of software out there, but what the software companies need to understand and do a little bit better as they need to niche down and they ultimately need to serve smaller market segments because they may have created a really great solution that works for a large company. You come into my business model in my industry and it does not work at all because we are entirely different. And so every assumption that you built into your software, I just imploded it for you And so it's really, you know, these software companies I'm looking for the day when they find greater opportunity instead of having, trying to serve the broad general market, but they instead seek to niche down and try to understand the needs of just a few markets at a time. But I don't see it quite yet right there in agriculture yet. I think there's a lot of companies trying, but it's, there's still difficulties. But yeah, I would say you know, just be weary of, you know, spending lots of dollars on software. There is a lot of functionality that you can do with Excel for example. You know yeah, every company I do believe should have a KPI dashboard to understand some of the major metrics that are affecting their business and they should be viewing those on a regular basis. But that doesn't mean you need to go out and buy some major business intelligence solution. What you first need to do is understand which metrics you want to view and you want to understand, and you do that from understanding the goals of your business. And aligning your KPIs to those goals of where you want to go into business and what makes sense in order to reach those goals. And then you try to go figure out how to measure those things. And if you can pay somebody just a couple, you know, pay somebody a certain wage rate for a couple hours of work in order to produce those on a weekly basis, you then have to weigh that against going out and getting a $100,000 business intelligence solutions that'll be out of date within two or three years and I have found personally that paying a person to simply, you find the way to gather the data out of our accounting ERP software and having them just put something together on Excel manually is far more cost effective than me going and buying a business intelligence solution. So it's just that, that idea that be weary of some of those softwares. Just make sure that you're really using what you have at hand to its full capacity before you and you're hitting a wall once you have resettled about before making a decision to move on something different. Announcer: (10:49) This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit website at www.imanet.org. 

(*EXTENDED EPISODE* Conclusion of Episode 4 from 6/24/19)#YAADS #datapossible https://www.theorylane.com/ https://www.linkedin.com/in/daniel-smith-data-scientist/https://www.linkedin.com/pulse/acid-just-sweet-80s-jeans-datapossible-daniel-smith/ https://github.com/thedanindangerFULL EPISODE TRANSCRIPTMusic: (00:00) Adam: (00:04) Hey everybody. Welcome to Count Me In, IMA's podcast about all things effecting the accounting and finance world. I'm Adam Larson here with Mitch Roshong and this week we cover the topic of data analytics and emerging technologies in accounting and finance. We have an extended bonus episode for you where we will cover multiple areas within this topic and conclude a previously recorded conversation. Mitch, can you tell us more about it? Mitch: (00:28) Thanks Adam. As you may remember a while ago I spoke with Dan Smith at length about all these technology and data related topics. Again, Dan is the head of innovation and the founder of theory lane integration solutions and he offers a very unique perspective on how these ideas relate to accounting, finance. Our talk got even more interesting as it went on, so I'm really excited for you to hear the remainder of our conversation.Music: (00:54) Mitch: (00:56) How can senior management accountants who may have limited knowledge when it comes to data analytics gain a deeper knowledge or a better understanding so they can enable themselves and their organization to kind of face these new challenges that are presented or new opportunities as we've said to work with technological tools. Dan: (01:18) Absolutely. We have this conversation almost every day. The easiest answer for me would be to check out the the IMA's analytics competency framework cause I've done a lot of advising with you guys on that. Absolutely right. Quick plug!, A longer answer is that I mentioned in a previous response the idea we're starting to break down the barriers of traditional business structure. There was a famous statement made over half a century ago by I believe he was a doctor, Dr. Conway. It's called Conway's law. It comes up in software development all the time. Conway stated, "any communication system designed in a business is going to model the structure of that business." In a modern context, it means that any solution, any application that's designed to solve a business problem is going to model the structure of that business. Now we've created a whole new set of ways we can current problems with the new paradigm of it's actually the internet. It's digital data. It's not just analytics, it's because now we can have information move in a completely different way. We have a business structure that is set up with a pencil and paper type of data in mind. Up until the past 10 or 20 years, we've just used computers to accelerate what was otherwise a written form of communication. Now we have to have these cross functional competencies because information is no longer constrained to a specific department. Those cross functional competencies are what we've been calling data science. That's the intersection of data statistics and business application of data and statistics. In my general competency framework, not the one that's just for accountants management accountants. I replaced statistics with machine learning simply because machine learning to me is the application of statistics through computer programs as opposed to a more traditional statistical approach. I don't think in many cases now for financial accountants you do because you guys are heavy in math, but in most cases you don't actually need to know that much statistics. It's abstracted away in most of the models you just need to know if it's right or wrong. So management accountants are a little bit of an exception, but otherwise in terms of data, the competency, if you know the lower level competencies, so you know how data moves in an organization, where does it live? How, how was it created, what are basic data structures and do you know how to use the data to create analysis in such a way that it benefits the business? Those are the low level competencies. I'm going to get more into those later so I don't want to dwell too much on them. fundamentally though it's the difference between understanding the competencies, understanding the low level reasoning behind what you're doing versus thinking about what tools should I use or what program should I use to solve this problem? Understanding what that tool is doing to solve the problem as opposed to what type of tool should I use. Mitch: (06:03) Once we have that foundational knowledge, those low level competencies, how do we, how do we move up? You know, how do we get these skills, these competencies? How do we learn the tools that are available so that we can make more effective decisions? Dan: (06:20) Yes. Perfect segue. There's a slide that I use all the time and you can probably find it on a webinar or on LinkedIn or somewhere where I talked about the idea of concepts versus tools versus technology. I use the analogy of building a house. When you first want to build a house, you talk to an architect. That architect uses the concepts of material design, of calculus, of structural engineering, all these ways in which he or she knows where to place a wall, to build a house, to put the foundation in, to put up the roof, et cetera. What you don't ask that architect is what type of hammer do they want to use for, or what type of CAD software are they are they using to create these images? It's irrelevant. and an architect certainly wouldn't start learning architecture by going to the hardware store and picking out, sitting there, evaluating what's the best hammer for the job. They would figure out what the concepts are and they would realize that, you know, a hammer might not even be what they need. They might need a screwdriver, they might need a pneumatic press. I look at learning a specific tool in the same way. Some concepts and some knowledge and tools translates very easily into other ones. I tend to recommend a bottom up approach with the caveat that you want to be able to apply that knowledge as quickly as possible. So you feel like your doing something, it's easy to get discouraged if you just feel like you're taking classes all the time. a nice mix of that is Python and Python, Jupiter notebooks or the various notebooks, solutions that you can find easily. If you know, if you know Python or if you can, you can't, you can't know. You can't know a programming language. First off, that's, that's a that's a common misconception. You can be capable of solving problems using that programming language, but you will never learn all of the programming languages. It's impossible. It'd be like learning English. People still study English all the time, but you can reach a level of functional competency with it. With, with Python, you can understand what's going on behind the scenes. You can do some basic programming, but it abstracts enough so that you're not bogged down in defining every single thing and working through all this obscure knowledge with that knowledge, with understanding basic programming competencies, you can move into a lower level language like a Java or a C plus or a C sharp. you can also easily move up into a into a more visual tool like a rapid miner or even a Tableau. Well, Tableau is not a good example of rapid, minor or a nine, because you know what's going on behind the scenes. Similarly when it comes to the data competencies, every BI tool across the board, this is, this is one of the few blanket statements that I'll make every BI tool that you come across, be it Tablo, be it click view, be it power BI. All those are doing are simplifying the process of creating an SQL statement. They're doing the aggregations and the joins for you so you don't have to write sequel code. That may seem like a benefit and in many cases it is. You can quickly get started. You can explore some data, you can see some visualizations. It's great when it becomes a problem is when we spend so much time trying to get a specific visualization or a specific solution or a specific thing using that tool. There are people that make a living off of using one of those specific tools because people have gotten themselves so imbedded into one platform that they can't decouple their operations from the tool. When you use raw code, when you use even SQL, but you can use code like Python or.net to execute SQL statements. I digress. When you use raw code, it is transparent, it is editable. You can have simple version controls against that code and other people can easily pick up what it is that you did. If any of you have ever tried to use a notebook or and an Excel workbook created by somebody else, you will know how long it takes to figure out what the heck it is that they did and even worse, if you try to debug it, it's nearly impossible. You have all these lines going everywhere. There's all these obscure references. It's a mess. That's much easier to do in transparent code. It's, it's also why you'll see people that are programmers being able to pick up a BI tool rapidly because they understand the concept and then all they have to do is look up, how do I do this concept in this tool? If you just know the tool, it's very hard because to navigate to another one because you only know how to do something in that tool as opposed to what is the lower level thing that you're trying to solve. Mitch: (13:09) In your opinion, where does this aspect of business fit in as far as which function and how does somebody in the finance function you know, where's the crossover I guess is what I'm asking and where should all of this data really be housed within an organization? Because to me it almost sounds like two different sets of skills and I just want to know where is the merger? Like what do you think the management accountants really need to be aware of? Dan: (13:45) Yeah. And I'm going to split your question into two parts cause the, the first part was where should the data live. And the other one is what is the role of the management accountant? The first one, where should the data live? I and I had a multi-part video with some people who are data integration. specialist data integration is something that a lot of people don't even know as a profession. That, that is the, that is the business of taking data and applications in an organization and making sure that they can talk to each other, what you hit upon and on. Where should the data live is a contentious topic in that space. What the state of the industry is moving towards is that every thing should have its own data set. Every problem should have its own set of data that's specific to it. And it's okay if that data is reproduced in places storage and processing with the emergence of cloud platform as a service and infrastructure as a service has become much more affordable so we can have redundant data. There's a whole, there's a whole specialization when it gets into really deep data theory of things like cap theorem the concept of we can have a data environment that's consistent, available or partitioned tolerant but you can only choose to participant partitioned tolerant, meaning that it can be in multiple locations at once. you can't have something that's always available and consistent. If it's replicated in multiple locations, I could go down to, can't be consistent if it's always available and partition tolerant because one is going to be updating versus the other. But that's a bit of a digression. I do have an article on LinkedIn about that. The reason I go into that is that it's okay. Now if you have data that's specific to a problem or an organization, in fact that's, that's, that's even better. The traditional argument for that was that it was expensive, it was expensive to house and it was expensive to manage and there would be risk associated with that data being everywhere where the management accountant fits into that. Particularly, and I've talked about this at length, the management accountant, if they are the ones that have those competencies of data statistics of the business applications they're in, they can be the one who articulates the value proposition of doing things differently or of investing a little more in your data environment or talking about the enormous return on investment for effective data governance. That takes a little longer than you would think. It does take a long time to get returns on invaded on data governance, but once you get them, it's huge. Mitch: (17:35) In order to communicate, kind of the last step in this progression when you are, you know, speaking with the executives about the decisions. A big hot topic is data visualization. So I'm curious about your thoughts on visualization. What kind of skills do you really need to effectively illustrate and visualize your data for your audience? Dan: (18:00) Yeah, and here is, here's another thing where I'm going to inject some unnecessary philosophy, but I want to give you a straight answer first. Visualizations as they stand right now are very, very, very important in order to move the space of business to a better understanding of what machine learning AI analytics in general is capable of doing. In the future. And what I mean by that, what I mean by that is in the future, generally speaking, people will have a better sense of what machine learning is, what analytics is, what is the new state of business. We're going to understand these capabilities internally or in general. We won't need to teach people data science in order to tell them what data science is telling them. Meaning visualizations in a few decades won't be as important, but right now they're extremely important because they're used to teach people data science. That's, the big stumbling block when people are trying to make visualizations, we're trying to get data scientists to make visualizations. Data scientists are generally not very good at visualizations because those visuals are used to teach. They're used to explain it's a completely different skill set than the predictive and programming and data modeling that data scientists have been trained to do. I put in my competency framework, I put visualizations not in machine learning and statistics. I don't put it in analytics. I put visualizations in business because it's a communication tool. Now there are visualizations like dashboards or a graph or showing that there's a story to be told there or or reporting to people. That's fine, but that's a reporting exercise that's communicating information in a succinct manner so people can make fast decisions. That's kind of out of the box. Those are normal things and then you have very complex specialized analytics or visualizations to tell advanced stories. That's a specialist. There's visualizations that are used as exploratory analytics, so am I trying to find a problem. There are also visualizations that are used to represent performance. Those are descriptive visualizations. They say this is how something performed in the past. Most management accountants right now are focused on those descriptive visualizations, which is what I would label as the baseline, the fundamental ones given that, what you just said Mitch, those are fundamental visualizations. The skill with the visualizations is knowing when to report, which making sure that you don't convey that information in a misleading way. There are two primary sources of what makes an effective visualization and that's tough. Tufty and Cleveland Tufty tends to be artistic in visualizations. It's almost about the art of visualizing data and telling a story with it. Cleveland on the other hand gives very practical advice for which visualization to use when in order to represent the distance between one point versus another, when to use a time series graph, when to use a pie chart, which is usually never by the way when to use a bar chart, et cetera. So the fundamental skills in that type of descriptive visualization, are not about what tools should I use, it's what visualization should I use and when and how can I represent that data in a simple, clean, effective manner. All right, I'm just going to give you a couple of quick ones. What is click view? Okay, so click view is one of the family of BI tools, business intelligence tools. Compare it to a Spotfire or Tableau or power BI or burst. That's B. I. R. S. T. there are a lot of them out there. Which one you want to use as a matter of personal preference, they are largely for descriptive and to a degree diagnostic analytics. So they are always, in all cases intended for communication to a human recipient. They are to help a person better understand what data is doing in a business. Because of that it can be a little challenging to operationalize some of the solutions that come about in a click view or any of the other BI tools. By operationalize, I mean what will happen as a person or maybe a few people will have so much capability with those tools to create an entire workflow of merging databases together creating their own table on their laptop, then making a bunch of visualizations and new tables and visualizations off those tables and so on and so forth. It is hard for the data engineers of the world to tease out exactly what the heck is happening in that thing and making it into a business application. So a new report or a new KPI, one in which they have acceptance criteria and unit test around to make sure that it's consistently correct. I emphasize that last point, not as a knock against BI tools. They're great to explore data. They're great to communicate some complex relationships to people where folks run into problems. And back when I was doing a lot of BI engagements, this is where they would call in my team. And I think there's another question that you've asked about why my reports are slow. The reason behind it is that you can have in a BI tool, a single person develop all this stuff, but nobody can ever figure out what it is exactly that they did. So oftentimes they've failed to account for every what we would call a corner case where the data may not be correct. There may be something on the back end or business rule that wasn't applied correctly. And it's hard for people to identify where that issue is occurring because it's all self contained within this platform. So what they are are BI tools. They're used for fast analytics and insights. What they are not are super rigorous reporting platforms, nor are they artificial intelligence automation platforms for creating your own custom product. And they themselves will not attest to being that they will tell you up front that that's what they should be used for exploratory and diagnostic. And to a degree descriptive analytics, but you should not try to operationalize these things in less. You have a robust system behind it. Mitch: (27:32) How about our Python, SQL, spark? How do those relate? What are their benefits? Dan: (27:39) All right, so R in Python are somewhat similar. R is kind of sliding out of favor at the moment because it is geared more for purely statistical and mathematical operations. In order to explain the subtle difference between them would take an entire podcast itself and it's nearly impossible to do visually without a visual tool but just to keep it simple. R and Python are what you would call a scripted language, they're a true programming language where you can create functions that execute operations. You can import libraries that automate a lot of the routine and mundane things you do in code. A lot of websites will have some Python element baked into them now. So when you open up an app on your computer or you go to a website and it's doing some processing in the back end, there might be some Python operation somewhere along those lines. Similar with our but ours on a little smaller scale. You'll see those types of data operations be embedded into BI tools like click and Tableau in order to extend their functionality a little bit. sequel SQL is a query language as opposed to a scripting language. You can't really build or you can't period. You can't build a application on your computer. That would be like a desktop app load. So like you can't build Excel using sequel. You can't build word out of sequel. It is a query language, meaning that you pass into it what you want from a data set and it will return that you just say, give me these columns the sum of this column and group by those other columns. That's it. It's basically making pivot tables just at a larger scale confounding all of this spark. Well, spark is a framework. You don't code spark is not a thing that you program in. It's not a programming language. You don't code spark you use Python or Scala or R to access the spark API. That is application program interface. the, R Python Scala operations get data into a shape or pass commands into spark, which then executes operations in a massively parallel processing in memory environment. so spark is a framework that you need to know a few operations in and understand how you need to shape the data for it. but the way in which you interface with the spark application is through an R or Python code. So you would still need to know our Python or Scala, which is another scripted language in order to use spark. But spark is a way to execute data operations similar to the way you would in SQL, but in a distributed data environment. I must say though, very long answer for this. Again I personally would not spend much time learning spark because it's largely abstracted in a lot of the operations that we do in data today. You don't, you, you don't code much in spark anymore. You're fine with just Python and SQL. If you have to study something that's really advanced, I would study TensorFlow, although even that is getting abstracted and things like torch PI. so conceptually you should understand what spark and Pence or flow and those other advanced data operation programs are doing. You probably do not need to learn how to code anything in them because by the time you do a easier way of doing it, we'll have come along. Announcer: (32:57) This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in from more relevant accounting and finance education, visit IMA's website at www.imanet.org.

John on LinkedIn: https://www.linkedin.com/in/thejohngarrett/Meet John: https://therecoveringcpa.com/meet-john/What's Your "And"? Podcast: https://therecoveringcpa.com/episode-200-whats-your-and/The Recovering CPA: https://therecoveringcpa.com/John's Message: https://youtu.be/YNs0BS0pjCcFULL EPISODE TRANSCRIPTMusic: (00:00) Adam: (00:04) Welcome back to count me in. IMA's podcast about all things affecting the accounting and finance world. I'm Adam Larsen and with me as always is my cohost Mitch Roshong. Today I know you can count on another great episode. We were joined by the host of the, what's your and podcast keynote speaker and MC John Garrett. John is an engaging motivator who looks to shatter accounting stereotypes and encourages everyone to develop stronger relationships with colleagues and clients. Tell us, Mitch, what was John's message throughout your conversation? Mitch: (00:35) John is referred to as the CPA turned catalysts for culture change and his message is all about the future of professionalism. He has done extensive research on how people's hobbies and passions impact their careers and in turn create a stronger workplace culture. On his podcast, he talks to accountants, consultants, lawyers, and other professionals about all the things they do outside the office. His emphasis is on identifying how these interests positively impact the work they do for our podcast. He shared some of his background and gave us a few interesting examples from his former guests to help explain the value of recognizing and calling on an individual's passion.With an accounting background and a unique perspective on workplace relationships. John explains how and why organizations can and should create cultures that attract and retain top talent.   Music: (01:31) Mitch: (01:33) I want to hear a little bit about your journey and how did you become, what you call the recovering CPA? John: (01:38) Yeah, so I, graduated from the university of Notre Dame and then started at a PriceWaterhouseCoopersand I did that for three and a half, almost four years. And then in the meantime, I was at a training? One of my first trainings was in LA, and so I took a, there were four or five of us that every way was like a three or four week training. And, we would drive down on Thursdays to the improv in Hollywood and watch whose line is in any way would tape in the studio and then they would come to the improv and do an uncensored show, in the middle of standup comedians before and after. And it was amazing. You're hanging out with Drew Carey and Collin Mockery and Ryan Styles and all these, and then comedians, Adam Stanley would drop in. And, you know, It was just like nuts. And and so, you know, you see these standups in Hollywood and you're like, well, I can be as funny as some of these people. And yeah. And so I just started to do stand up for fun, just as a hobby. It was clearly the exact opposite of, doing internal audit and mergers and acquisition work. And it was, you know, just a creative outlet. And, yeah. And then over time, I accidentally got really good and you know, I started to take vacation to go, do it. And then I left public accounting and went into industry, so that then I could, you know, have a little more of a regular schedule and, yeah, I just kept pursuing it. And then in may of 2005 left altogether to do a stand up full time, although I don't ever advocate that anyone does anything that ridiculous. Like it's insane. It's insane. Don't quit your job, keep it as a hobby. Like it's nuts and, yeah. And then about four or five years ago, kind of married those two lives together and bringing some engagement and a unique thought to corporate events. you know, all staff meetings, partner retreats, executive, new manager training type things or even just as an emcee and hosting panels. Because let's face it, I've been in the audience for a lot of these and, they are not, stimulating, I guess is the nicest way to say it. Mitch: (03:45) Very fair. Well, a definitely an interesting journey, you know, not one you hear too often from, from an accountant. But yeah, out there though, man. They're out there. They're, we're cool. Don't tell anybody. No, no, no. I, I really enjoy the stories. So yeah. Where are you are now how you married everything together? I guess in a nutshell, kinda tell me, you know, what, what's your vision? What's your goal? What are you doing here to help companies kind of recognize why their culture matters and, and what do you have to offer them? John: (04:13) Yeah. Well, the ultimate goal is that when a teacher asks a kid, Hey, what do you want to be when you grow it up? They say, I want to be an accountant. And instead of astronaut or fireman or whatever ridiculous other job, no, I'm just kidding, they're not ridiculous obviously, but, but yeah, I mean it would be just so cool if people just quit looking at us, and we quit looking at ourselves in this way and so I'm out there just shattering the stereotype of what people and, and the saddest thing to me is that I think the people that believe the stereotype the most are accountants themselves. And it's just trying to get them to see that, we all have a unique skill set and a unique talent that we bring to the office and that expertise isn't always in our degrees and letters after our name with certifications, sometimes this expertise is, outside of work passions and interests that we have, makes us better at our job. You know, it gives us unique skill and or, and makes us human and relatable to, good coworkers to people in other departments. And, and so it's been fascinating and about four years of research now that I've put in and just, just finding all kinds of examples, and , interviewing 'em over 200 people, and of all kinds and , just just finding out that, you know, hey, the stereotype is upside down. Actually the stereotypical professional is someone who has multiple dimensions to them and the sooner that, organizations accept this and celebrate this and shine a light on that, the better it is going to be for everyone, including your bottom lines. So, that's basically what I'm out there doing is yeah, just working that, shattering that stereotype. Mitch: (05:57) Well, I know here at IMA we've released our competency framework recently, you know, enhanced it with a couple revisions to it and one of the, you know, central elements is our leadership domain. So, you know, in talking with you a lot that you are sharing with organizations, I feel kind of fit into those competencies, you know, are very relevant to, the industry even though it is a little bit off kilter. You know, it's a little bit different perspective, but you know, how can you provide some highlights for our listeners on how important, you know, motivation, inspiring a lot of the key attributes of leadership apply to understanding who they are outside of the office. John: (06:37) Yeah, absolutely. And you know, I mean, because you can't really develop trust, with people if you're trying to be super manager, super accountant, super technical expertise person No one believes you. No one trusts you. That's very surface level. And so actually showing a genuine interest in people and admitting that people are working so they can live. I mean, yeah, sure, they're really good at their job, but, is, you know, that really their true passion would you do your job if you weren't getting paid while you're painting and playing the piano and not getting paid or riding a bike and not getting paid. So, you know, it's, it's just admitting that, and actually I interviewed a guy named Mark Windburn works for a firm in Houston. He's an amazing singer, amazing singer. And he referred to singing as his breathing and happy. And I was like, wow, that's so perfect. And I said, well, what about your it audits? And he just laughed and you know, and it's like, well, there you go. I mean, you know, and so a lot of organizations that they hire people because they have these extracurricular activities on their resume, but then they never let them go do their extracurricular activities, or they don't ask about them or they don't, you know, shine a light on them. And so it's, it's really looking at your organization, the core of your organization is people's outside of work, passions and interests. That's the core of your culture. And because if we take your department and replace it with all new people with the same technical skills and same degrees, the work gets done just the same. But, clearly it's a completely different department and it's because of the personalities and the passions of the people. And so, you know, if you're able to reach that human connection with your people, then all of these things that are in the competency framework for leadership are nailed. I mean, as far as motivating and inspiring people, you're able, if you're able to dovetail a little bit or even talk about people's passions and bring that into the office and have them talk about it. Or maybe if someone has a skill like there in community theater, well, if someone, if it's time to give a presentation, pick that person to give the presentation, they're going to light up and they're going to be way better than anyone else in the department. But they're also going to be super engaged and super excited about that project. And so there's a whole untapped well of talent. Think that we leave behind that. I think, you know, you wouldn't take a tax expert and put them over in a financial analyst role. Well, in the same way you wouldn't take someone who loves jigsaw puzzles and throw them up in front of an audience, tell them to go knock it out, you know? And so why do we only care about one of the skill sets and not the other? I mean, I think the way we define expertise is a little too narrow. And so, you know, when it comes to collaboration and teamwork, you know, you, get the, those connections going with the chemicals in your brain with epinephrine and oxytocin and it creates trust and bonding and the lows aren't so low. And conflict management, I mean, that's huge right there. So if the only time you talk to somebody is about work and about what they did wrong at work, well then guess what, your is going to be pretty terrible. But if you actually talked to them about what they love to do, when you show that you care about them as a whole person, because hey, you hired the whole person, not just the 20% that knows the technical skills, then, you know, the conflict management isn't so bad because now it's someone who cares about me, is giving me feedback to make me better, not someone who hates me and I'm going to quit because where I, you know, and so it's just being more human and just, just admitting that, you know, hey, we, we've all got something outside of this work, so let's talk about it. I mean, it's, it's crazy to me that we don't, or that it's, you know, frowned upon. Mitch: (10:20) Yeah. You know, it's , just the first time I talked to you, it was such like a obvious perspective and an obvious theory yet you don't really hear a whole lot about it. You know, it was something that was new, but it was like common sense. So, I'm just curious what kind of results you've seen, you know, as far as feedback, followup, anything like that. When you talk about developing these skills in the workplace and these relationships and trusting each other, you know, what kind of results have you seen as far as the bottom line for businesses who you've done this for? John: (10:49) Yeah, I mean, it's been awesome. , there's a a firm in Ohio that have offices in Pennsylvania and Ohio and Florida and New Jersey. And so you have a lot of these people that are talking to each other and working with each other and virtually and so, the head of the learning and development there saw me speak at a conference, went back and implemented this, which was amazing. We talked about it and then he put it into action. And so they had a video conferences, over lunch, like once a month. And it was couched in a, a Toastmasters training sort of a thing. So you had five minutes to give a talk. And the topic for everyone is your outside of work, passions and interests. So you're getting public speaking experience, you're getting coaching and feedback on that, and you're developing that skill, but you're accidentally becoming best friends with everyone who's in the video conference. And so now all of a sudden you find out that somebody that's in another office in Florida does the same thing you do. So now when you pick up the phone and you ask them for something, it's not your friend and it's like, hey Mitch, can you hook me up with this? I'm like, I need this like right away. And then they'll get it for you as opposed to, you know, hey Mitch, someone who I never talked to unless I need something work related. Well, you're not going to get that to me very fast and you don't have this very strong relationship. And then turnover and engagement. I mean, that's where bottom line is hit. I mean, you know, if you have a sticky relationship with your people and you care about them and they care about you, well then turnover is going to go down and they're going to be way more productive. So, you know, and that's expensive when people leave. And I think a lot of people just think that it's natural and well it just happens and it's always been double digits or whatever and you know, it sure there's going to be some turnover but does it have to be that high? And looking at it from that perspective, it's pretty scary, like the impact that it can have and, and it's pretty cool how just taking a little bit of time can actually, you know, save a lot of money in the long run. Mitch: (12:43) Yeah. That's awesome. That's a perfect example. It kind of leads me nicely into my next question too, cause I saw on your website one of your taglines is the future of professionalism. So I'm just kind of curious, you know, in your words, what is the future of professionalism? John: (13:00) Yeah, well, I mean the future and honestly is the present, but I call it the future cause it, it doesn't make me angry as much. The future of professionalism. It's someone that is good at their job, but they are also good at something else as well. And they love to do other things as well. They're multi-dimensional. And there was a study done at Duke that showed that people that have more dimensions to them are less prone to anxiety and depression because if everything's work-related and, and you're all work all the time, then every decision that's, that's lingering, you're so anxious about, and I mean you're on edge and then if you don't get that, well now that's a hundred percent blow to the face. You know, where if you have other sources of confidence and other sources of your identity, then you know, you're okay with that. Yeah, it's things a little, but that's fine. You know, sun will come up tomorrow, we're all good. And then when you go to retire, you'll actually have something to go do because you have a life, you know? , there's some people and organizations that I consult with and some of the executives are like, hey, you know, I'm getting ready to retire and I don't really know what I'm going to go do. And that's super scary to me. Like that's super scary cause you've got another, I don't know, 20 plus years of good life left and you don't know what you're going to go do with it. Like wow. Like that's nuts. And so it's just trying to get people to see, you know, just the human side to all of us. And, you know, cause actually I did a little research, about a hundred years ago, and up until the 1920s, at the largest bank in the UK if you wanted to marry someone, you had to get permission from the bank, who to marry. That was considered professional. And then at some point in time, everyone was mr so-and-so and mrs. so-and-so, and, in the office. and then we stopped doing that and we just started using first names. All of a sudden that's considered professional. And then at some point we stopped wearing ties and then at some point we stopped wearing suits all together. And then at some point we stopped even going to an office. And so it's the, you know, the, the accountant, who, you know, works from home in a hooded sweatshirt and you know, gym shorts, less professional and less good at their job than the person a hundred years ago that required permission, who to marry. No, they're just as good at their job. And, you know, so it's just acknowledging that and looking at people and kind of meeting them where they're at is where it's at. Cause that's how you attract and retain top talent. Announcer: (15:28) This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org. 

Contact Rhondalynn:LinkedIn - https://www.linkedin.com/in/imagineering/Rhondalynn's Work & Recognition: http://www.prweb.com/releases/2016/11/prweb13878827.htm https://www.youtube.com/watch?v=jb2rqTL4QW8&feature=youtu.be https://www.youtube.com/watch?v=J3rRoQUxb5g&feature=youtu.be Finalist - Best Digital Start Up - 23rd annual AMY Awards Top 3 Finalist - Female Fintech Leader of the Year, Excellence in Data and Artificial Intelligence Top 10 Cloud Accounting Apps of 2016 Top 10 Small Business Apps of 2016 FULL EPISODE TRANSCRIPTMusic: (00:00) Mitch: (00:05) Thanks for joining us for another episode of Count Me In as we bring you the latest perspectives on all things affecting the accounting and finance world. If there are other topics relating to accounting and finance that you're interested in hearing about or if you have questions from the industry that you'd like answered, please let us know by leaving a review and a comment or dropping us an email at podcast@imanet.org I am your host, Mitch Roshong and I'm joined by my cohost, Adam Larson. This week's featured guests joined us all the way from Melbourne, Australia and talked to you, Adam, about optimizing advisory services and client value. Tell us a little bit more about your conversation. Adam: (00:44) That's right. Mitch. Rhondalynn was kind enough to join us from Australia and discussed how our accounting background has helped her become a successful business professional with a unique teaching methodology. She helps individuals Excel in their careers by adapting to the evolving industry and future proofing themselves. Later parts of our discussion we'll tie in said that same idea as she discusses how these skills can be applied to positively effect small businesses and help others to also teach accountants. Rhondalynn is a well rounded accounting and finance professional with experience in tax, business development, operations and business coaching in addition to legal knowledge. It was a fascinating conversation that will span two episodes. So let's listen to part one now.   Music: (01:30) Adam: (01:33) So you have extensive experience in various areas of accounting, business operations, advisory through your time. What skills and resources have proved to be most important in becoming a successful accounting or business professional? Rhondalynn: (01:46) Oh, that's a excellent question because there's probably almost too many to name, but if I had to pick the top ones, this is probably how I would approach it. From the perspective of accounting, the thing about us as accountants, you know, we're numbers people, we love the numbers. You know, cash-flow was either right or it's wrong. So we're all about accuracy and numbers and that's fantastic when you're in an accounting profession or in an accounting job. But if you want to make the transition to helping small businesses or providing advice or coaching them or whatever you want to call that, transition. The thing is, is that we actually need skills that are diametrically opposed to the ones we're good at. So for me it's about figuring out how do we transition from being fantastic at accuracy to the other end of the spectrum which is managing uncertainty. And so I'm all about, you know, how do we make those transitions across? Because most of the things that we require, in my estimation to be really, really good in what accounting has kind of evolved to over the years really involves us relearning and unlearning a whole bunch of stuff that served us well in the past, but doesn't really apply or isn't really applicable to this kind of new job that we find ourselves in. You know, disruption has changed what I believe and what most people believe. It means to be an accountant. It's more now about accountability and it is about the accounting. So I think the biggest skill that I've learned is adaptability. You know, being able to actually unlearn things and relearn things and be flexible and change with the times. Adam: (03:41) So how do you make yourself adaptable? you know, especially for those who are, who have been accounting in accounting for their whole lives and been stuck in one role and then they're suddenly thrust into this other thing where they have to apply their skills in another area and then they're not used to that change. How what advice would you give them? Rhondalynn: (03:59) Well, you can't really learn to swim by reading a book on swimming. So the only way that you can become more adaptable is to basically get pushed into the deep end. You know, you've got to be put in situations where you need to react and you've got to see how you do react. You know, you can take courses. I know a lot of what we do. So I do quite a bit of training with accountants because people ask me this question all the time. And what I found is that sometimes we are not good in judging. We can't. Sometimes we have difficulty frankly in objectively assessing where we're really at. And so one of the things I like to do when I'm working with accountants is to ask them questions, get them to do tasks or put them in situations where they can self assess their level of competency in these types of skills. So it doesn't really do any good to tell people, hey, you're not adaptable because people get their backs up. But if they can see for themselves that, hey, maybe I'm not as adaptable as I'd like to be, it opens the door for them to be in a welcome to have the learnings and coming in with a mindset that they can do it. So I think a lot of it is just, you know, taking courses or putting yourself in situations which are outside of your normal frame of the four corners that you have yourself boxed in and realizing that, hey, it's okay to feel like a fish out of water, but it's about how do we react to that and learn moving forward. I mean, adaptability is something that you will probably always be learning. You know it's not really a destination. You don't say, well, I've mastered adaptability and that's the end of it because there's always going to be a more uncomfortable situation or a more complex or unusual or unpredictable situation that you could be put in. So I think, you know, as we grow more problems and challenges come to us that push us to learn adaptability again and again and again. Adam: (06:12) That's great. And so, you know, with technology constantly advancing and many things changing the accounting industry and just all industries in general, you know, we've already talked about adaptability, but what other skills and strategies do you recommend to help, you know, future proof your career? Rhondalynn: (06:28) Accounting and disruption, it's easy to get carried away and think that this is the first time, right? But it isn't, you know, for anybody who's listening to this, that was old enough to have been around in the 80's when the desktop computer showed up. That was another disruption, a major disruption. And that disruption fundamentally changed the way we as accountants did our jobs because it put our clients in the position of wanting to have stuff at their own desks. You know, back in the olden days, people brought all their things to their accountants in shoe boxes and all sorts of stuff. But when the desktop computer showed up, they started taking back ownership of some of the data. And that led to the situation that we now find ourselves in where we are doing a lot of compliance and cleanup because the client can often input things, but they may not be correct. And so we're, you know, in the transitional phases of cleaning up a lot of, things that perhaps, weren't as good as they thought they were doing. And so I guess what's happened now is we're in another wave of massive disruption, but this one's quite different. The good news is we have a couple of choices. Number one, we can learn from the past. We can kind of remember what happened with the last disruption in the 80s and realize that, you know, we control our own destiny and it's time for us to step up as a profession and redefine ourselves. What it actually means to be a an accountant rather than having somebody else tell us what that entails. But it's about figuring out, you know, how do we adapt to the pace and the acceleration of all of these new innovations. Because you know, just recently QuickBooks announced that they were going into the live bookkeeping space and that, you know, frightened a lot of people. That was a, you know, that might have caused a lot of people to be very, very concerned because they were thinking about, you know, what's going to be next? Am I going to lose the bookkeeping work now? What's going to happen with that? How do I price myself to compete with that type of an audit offering? but there's AI and there's machine learning. I mean every day we open up our desktops to a new announcement about some new innovation that's been incorporated into a cloud accounting package that automates another thing that we might have charged for in the past. So it's easy to get caught up, I think mentally, in the fact that I need to keep pace with technology, I need to learn this package and I need to practice and learn this app. But at the actual, you know, foundation or inner circle of all this are actually two things that have nothing to do with technology and they are, in my estimation, more important. One is your pricing, right? and two is high touch, not high tech. And I believe that those are actually the solutions for this dilemma that we're facing. And I'm going to explain both of those now to you and tell you what I mean by that. Pricing is the fulcrum in your practice. It's easy for everybody to say, I need to learn new apps. I need to know how to market myself on social media because I need to find new customers. No, you don't. Actually, the very first thing that you need to do is you need to get your pricing right because pricing is the fulcrum. The pricing is the point at which you exert pressure to get maximum leverage in your practice. And if you don't have your financial model correct, meaning you are not charging your clients the correct amount of money based on the value that you deliver in the engagement, then you shouldn't be spending any money on marketing and it shouldn't be, you know, wasting a whole lot of time in technology. Because what you're going to find out is you're going to be attracting clients and you're going to be implementing technology and you aren't going to be getting paid for it or you're going to be getting paid less than you deserve or less than what the value is really worth to that client. And that's a huge dilemma because everybody wants to jump in and talk about technology and everyone wants to talk about marketing, but pricing is the fulcrum. Pricing is job number one in any accounting firm. It's about how do we get to the heart of value? How do we figure out what in the world is keeping our clients up at night? What's stressing them out? What are their pain points, what desire transformations do they mean and how do we create that value for them and capture some of it for our firms. So it's high touch, not high tech. And that's really, that's a tough pill for a lot of people to swallow because we are accountants. So we've been trained our whole career to focus on the numbers. But what I'm saying though is fundamentally different because pricing ain't a number, it's a feeling and high touch, not high tech is all about the conversation, right? It's about how do we interact and engage with our clients and really provide value. I think that unfortunately in our industry we have been given a Trojan horse, right? Somebody has paraded the horse in that horses technology and it has provided a formidable distraction for many people. And while I embrace technology and think that it's important part of us, you know, delivering more value because we want to automate the stuff that we shouldn't be spending time on. We want automation to do the heavy lifting so that we can focus on what's really important. But in order to do that, we have to train ourselves, right? Because we can't just keep falling back on the numbers of the past. You know, what transpired in the business. We have to fundamentally understand, what's a value to the client and they care about the future. You know? Yes, they care about their tax, you know, how much tax they have to pay and what their financial position looks like and all that stuff. But more importantly, what about the fact that they might just lose their number one customer or something's going to happen with, their supply chain. Maybe one of their suppliers is in trouble. It's about how do we help them circumnavigate all that stuff. That's what we should be getting paid for. You know I get cross when there's all this focus on, oh you need to use this dashboard and you need to use this KPI, all of that stuff. That's not what we should be getting paid for. That's not advisory. You know, selling a dashboard to somebody or giving them some numbers ain't advisory because the client is still looking to you and you're doing all the work. If your client's not doing any work and your client's not engaged and they're not taking action, guess what? You're still doing compliance. We should be getting paid to hold the hands of our clients and help them to achieve the result. You know, people often say to me, because I own my own tech solution called Businest that does the dashboarding and the forecasting and people always say to me, Rhondalynn, why doesn't your tool go deeper and tell the clients exactly which debts they should be collecting? And my answer to that is very, very simple because that ain't the problem. The problem isn't that you and I as accountants need to help client X go out and collect money from Bob, Susie and Edward. The problem is we should be helping them put systems in place in their business to prevent debt from actually becoming uncollectable in the future. That's advisory and no app can do that. You know the most powerful app that exists in this industry sits between your right and your left ear and we need to engage it. Announcer: (14:29) This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

FULL EPISODE TRANSCRIPTMusic: (00:00) Adam: (00:05)Hey everyone. Welcome back to Count Me In. Thanks for coming back and listening to some new accounting and finance perspectives. If you're enjoying these learnings and don't want to miss out on future episodes, please be sure to subscribe, download, rate, and review. Now this week our episode puts a slight twist on some of the recent conversations we've had as we begin to talk about using data analytics for fraud prevention. Mitch, not many people better to talk to about fraud and forensics and accounting than Danielle Supkis Cheek. What kind of insight did she have to offer?  Mitch: (00:35)Well, as you said, many of our recent episodes have talked about the data transformation happening in accounting, but today's conversation is going to cover how to build a data analytics program for fraud prevention. Danielle is a director at PKF Texas and served as a part time faculty member at Rice University in the Jones graduate school of business. She is a certified public accountant, certified fraud examiner and a certified valuation analyst as she also serves as the chair for the PCPS technical issues committee with AICPA. Five times she was named to the 40 under 40 by the CPA practice advisor and she was recognized four times as one of the most powerful women in accounting by CPA practice advisor and AICPA. Danielle is a true accounting expert and covers a number of topics relating to analytics and fraud for us. So let's start the conversation.  Music: (01:37) Mitch: (01:39) Data analytics has been a hot topic in accounting, but are companies jumping into data analytics too quickly? In your opinion, what should they be aware of and make sure they do first?  Danielle: (01:45)I actually think it's the opposite. I don't think they're jumping in fast enough. You know, you can actually do a data analytics program fairly cheaply and honest. So if you overly invest on the front end before you really understand what you have, it's going to be a very costly process and you have a risk of a lot of sub costs. So I actually think people should take a, you know, a page out of the agile project management methodology and kinda jump first, figure out what they have and then start fine tuning as well as there's actually a fair amount of learning about your data. As you start getting into a program and since the software has become so cheap, it's usually a fairly easy initial investment to figure out what you have.  Mitch: (02:28)So then how do you begin even thinking about what needs to go into this program? How do you build an efficient data analytics program?  Danielle: (02:37)I would say you kind of started a couple of different places. One, of course you have to inventory your data and figure out what you have. Sometimes you know, it's just a matter of, let's see if I can get an export out of my system just so I can start seeing what the data is. Clearly, if you have access to a data dictionary, which is kind of a summary of all the different fields of data behind the system and what it actually means, that's really, I mean best practice and really helpful. It saves a lot of heartache and grief, but a lot of times it's inventory. What you have, you know, sometimes it's as simple as let's start in Excel, let's move on to some of the bigger packages. You know, these days Tableau is so relatively cheap. Power BI is coming with your 365 implementation. So you can start doing a visual exploration of your data and seeing what you have and starting to focus on what are the areas that you think you have risks and really fine tuning it to your risk of your business.  Mitch: (03:30)Well, let's talk about that risk a little bit more now. I know you've referenced in previous conversations with me something about a fraud tree and some of the common risks that you can help identify around your business. So what are some of the examples of fraud that you've seen that maybe, you know, could have been prevented or avoided if there was an effective data analytics program in place?  Danielle: (03:51)Yeah, so the risks of your business really do come with whatever is your industry as well as how you operate. And a lot of companies have a hard time identifying particularly fraud risks of you know, it could never happen to me. And the cost of fraud is so high. So what you end up doing is you can use the association of certified fraud examiners, fraud classification tree. And what they do is they take three major classes of fraud, which is the fraudulent financial statements, so just fudging the numbers in effect, a misappropriation of assets. That's kind of all your thefts of cash. That's inventory expense report type frauds, payroll frauds and classify all those as well as they have a corruption tree. And so it's really useful to actually take this, it actually looks like a little flow chart tree diagram and in three different branches and go through each little box and say, how could this happen to my company? How would the data show this? Because one of the things that your, your financial statement data is always going to be what's getting manipulated when you're trying to cover up a fraud. But what you can find is some operational data, hopefully that, you know, you can hide the numbers potentially if you cover it up. But how do you hide that behavior that's happening operationally to cover it up and that's much more difficult. So starting to use the fraud tree classification tree, that was mainly an academic exercise that ACFE put together and use that as your starting place of what are my risks in my organization for fraud.  Mitch: (05:21)What are some of the other I guess, you know, fraud prevention practices that you could recommend in addition to just kind of looking at the risks, the financial data, the operational data. What else do you see organizations doing to try and prevent this you know, illegal activity?  Danielle: (05:37)Yeah, so I would say the absolute number one best way and ACFE agrees with me is having a whistleblower hotline or a reporting hotline of some sort of the hotlines are so cost effective these days. You get one of these third party systems. By the way, if anyone's listening happens to be a nonprofit, they usually give nonprofits discounts and you can a fair amount of information on those even if they charge by the minute for somebody leaving a tip for you. Cause most fraud is discovered by tip. Even if it's not actually fraud and it's just some kind of waste or abuse that is really valuable information. And even if it's like a dollar a minute, that's still far less than anyone else's hour of investigative work from somebody like me or more my colleagues. So putting that in place gives you a lead and it gives you, especially if you're nonprofit, you get a easier nine 90 checklist item. But for everybody else, it also gives you the ability to get that information, have that corporate culture of reporting and that we're trying to do everything very openly and transparently. And when there is a problem, there's a resource for people to go to and that's really helpful because you can get that data faster and have someplace to go first. And then right after that is that data analytics of proactive data monitoring program is actually the number two way with surprise audits actually.  Mitch: (06:59)So can you walk us through a little bit of your, you know, normal investigative work. If you were to come across a case, what are some of your practices?  Danielle: (07:07)We actually usually start with some kind of analytical review of whatever we have access to. So usually somebody has a hunch of something or could specific concern. And we usually do start with some kind of data analytics because we need to start fine tuning and seeing what looks anomalous. It's hard to just decide we're going to open up a file drawer and this is where we're going to start and start, you know, wasting a lot of our clients resources on doing a bunch of tests that don't necessarily matter. So we really want to use data analytics to start fine tuning where we spend time, you know, if it's an unknown, we can start using something like a Hawthorne effect approach where you create the perception of additional monitoring or actual additional monitoring. And you compare that before and after because people change their behavior when they think they're being monitored. If you don't know what you're looking at and you can't find anything at first, you can start looking at changes over time and you can start looking at some really high level ratio analysis if not your traditional ratios, but comparing your nonfinancial metrics to your financial metrics, looking at trends or some, you know, modified relative analysis where you're looking at the vendors that are progressively increasing month over month over month, because people usually test the waters with one kind of fraud and then start accelerating if they're starting to see that it's working in getting through the system. So it's usually a fair amount of this data analytics at first. And so if companies start putting this in place on the front end and be proactive about it, they're going to start detecting fraud faster or even just inefficiencies and have some operational gains from it because that's our first step. And then once we go from there, then start getting into that more you know, pulling records, doing detailed vouching and all and you're kind of more traditional audit or investigative steps.  Mitch: (09:05)To avoid these, you know, added costs by bringing in some kind of investigation like you just discussed. What are some of the costs of doing a program internally for an organization? What can an organization do, you know, to put some things aside and make sure that this added cost doesn't actually ever appear.  Danielle: (09:24)Yeah, I would say, you know, the software cost is actually not the primary cost. Usually it's going to be the opportunity cost of somebody's time or if you have to bring in somebody because you don't have the expertise in house. But if you have somebody that's kind of that gung ho analyst type mindset and they're the excel wiz, a lot of times just giving them some resources, the software as well as some training. The training actually usually ends up being more than the software, but a lot of the softwares are becoming very self-service, very easy. Lots of YouTube videos or training resources from the software vendors. and the software has not become the driver of the cost. It's the opportunity cost of the time in place. And if you have to, you know, provide specific resources and if your it team needs to get involved or you need to bring in somebody from it, once you start doing some of these dynamic connectors where you're pulling real live data into dashboard style analytics versus kind of more historical looking, I get an export of my system and then start looking at high level analysis, but you start comparing this, you know, even one FTE salary to the cost of fraud. So the, the ACFE estimates every other year what the costs of fraud is for big businesses, the median loss is $100,000. For small businesses it actually doubles to about $200,000. And then if you actually are the victim of fraud, many times you're the perpetrator of fraud additionally, because you were defrauded and you can get fined, you can actually have some violations like related to foreign corrupt practices act that come with criminal repercussions. So when you're talking about, you know, your $1,000 or less for a software license, Tableau is like eight $840 I think right now per user power BI is coming for free with most of 365 subscriptions, a lot of companies are doing their office 365 migrations. You know it's the time that takes to actually start digging into it. But a lot of companies already have people that enjoy this kind of work and if they allow them to proceed with this, they can usually find some good nuggets.  Mitch: (11:27)Now, I usually wrap up our conversations by, you know, asking something about the future and I've seen in a recent interview or a question that you answered where you're very cautious in identifying what the future holds when it comes to data analytics because of technology. But I'm gonna ask you anyway, when it comes to fraud prevention, you know, what do you see? Maybe it's the near future. How do you see data analytics helping fraud prevention even more?  Danielle: (11:55)I mean, it's a tough question because as you said, I tend not to answer something like that because I can't, I don't have the magic eight ball. I don't have the crystal ball of what's going to happen in the future and things are changing so fast that I can't even begin to comprehend where we're going to be in five, 10 years. But near future, you know, I can take a guess at that. I think what's gonna happening is the change in GL systems like operating accounting systems. You know, QuickBooks was actually one of the first to do this where the GL is no longer a summary of batches that are being held in other modules So sub ledgers are not being batched in putting into the GL. The GL is getting every single transaction and the modules are in effect reporting off the general ledger with additional fields from the table. And, and that's not exactly right on the database architecture, but if you think about batches like daily batches versus each transactions hitting the GL. And you know, as the companies have gone to more ERP style softwares that have larger computing power, you know, some of those legacy softwares that still do things in batches, I'm going to see even more so go away. And I think you're going to be able to gain more information and data just from your GL system. I think it's going to be the big one. And working with large populations of data and looking at full populations. and then I think also the, the model where companies go to ERP's from the smaller market softwares I think is going to be delayed. I think you're gonna start seeing more, you know, you have a smaller system that is a more generic system, your QuickBooks zeroes type of systems as your core GL system. But you have more add-in plugins and the add-ins and plugins are going to start getting so robust and the same capabilities going to improve that you're going to start seeing people stay on longer because they can start doing somewhat best in class for industry niche specialties of their different mainly revenue side of things and then that's going to be summarized into a QuickBooks GL. So you're going to start having this push towards, some information's going to get more centralized and the bigger accounting packages, but in some of the smaller sides you're actually going to have it more distributed. And depending on how the sinking works, you're going to have to start really being very strong, either joining data or somehow comparing data between two different systems or you're getting it back to easier on some of the bigger packages. So I think it's kind of a, a back to the old and, and, and, and the new coming into the old and the old coming into the new and it kind of a mixed match of where different systems used to be in different marketplaces of like in the size of the clients. So I think that's gonna be the future. The short term future trend is a kind of a shift on where the underlying data resides and how that makes for complex analytics. Because you're starting to have to pull in from many different sources potentially, or you get a one big source that's really hard to manage because there's so much data in one system.  Announcer: (15:00)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Cate Long:https://www.linkedin.com/in/cate-long-9649412/FULL EPISODE TRANSCRIPTMusic: (00:00) Mitch: (00:04)Welcome back to Count Me In, IMA’s podcast about all things affecting the accounting and finance world. I am your host, Mitch Roshong and with me is my cohost Adam Larson. Today we are going to hear from a former vice president of services for a fortune 500 software company about all things technology and analytics related. Adam, can you tell us a little more about Cate long and what your conversation was all about?  Adam: (00:29)Thanks Mitch. Absolutely. Cate was also a controller for a mid-sized manufacturing company and is now an investor for various startups. We talked about data visualization, data governance and information systems and how all the different technologies can influence strategy. Let's go to the conversation. Music: (00:51) Adam: (00:54)So let's talk a little bit about your background and how you use data visualization to strategically impact organizational decision making.  Cate: (01:02)Hey, that's a great question. Hey, you know, data visualization never really came to mind to me when I first thought about and entered into my accounting career. I didn't think of that as a strategic thing, but it is top of mind. It's very top strategic tool that you have. It's been a key driver to help me get a point across to show data in an explainable, understandable fashion that really helps point out areas of concern or kudos that were doing something really well to any audience from talking to and when I was in a controller for manufactured people on the floor or leaders of specific departments up to board meetings where I had to really understand and explain any changes in our variables to that group. just any audience that needs the information to drive company strategy, which is to your question which is more the types of questions that I would be and data that I would be showing to management leadership or to board leaders. A couple of examples come to mind that really helped me help employees. One of them was really helping to enhance employee morale, morale that I'll get into that example. And then another one was a strategy on what we should be looking at as far as winning or losing customers. So the first example I worked as a controller for a manufacturing company that was privately held and we had just gone through a remodel of the office. So employees saw a lot of artwork and new furniture and a new video room where I was giving presentations and they were wondering really how that was going to affect their profit sharing plan and we started hearing rumors about it. People were griping about the remodel, which actually the remodel brought in a lot of value bringing in customers or whatnot and making it more comfortable for everybody. But what I was able to do is I generally showed financial information on a quarterly basis to leaders in different, various leaders within the organization. And so I really broke down visually. I'm not just talking about profits and losses and, and our productivity, but pointing out what EBIDTA was or earnings before interests depreciation, Texas and amortization. Because the profit sharing plan was based on sharing, you know, buying equipment artwork and, and furniture design didn't come into play there. So was able to show them that, no, that doesn't affect your profit margin or your profit sharing plan. So don't worry about that. So that was a kind of a unique example for that company. But something else that comes up a lot is how you're going to explain your KPIs and in looking at that and, and too in how businesses change over time, one of the big numbers that software companies look at is their customer retention. So typically software companies can start out selling to smaller companies or they can start up selling to fortune 500's, which is what the company that I worked for did. So they had a pretty higher customer retention, right? These large companies do not change softwares very frequently, so they always had a very high customer retention rate. But as we, as the years went on and we got more competition and we started getting into the middle and small market that number, although still very high, I could start to see some erosion and I made sure that in our data systems that we had fields where we were capturing whether this the company was a small middle or large market customer. And then also that we had reason codes that we were capturing about why customers left. Because the smaller companies of course there's more of those companies fold or they can get out of a contract or they, they changed softwares more frequently than a larger company. So by dividing that data and visually you know, showing it to the board that this is what's happening, then we were able to set new KPIs for those different sizes of companies. So thinking ahead, that's the kind of thing that you wanna think about as your visual, as you're creating your presentations and you're going to talk to different people, especially those top decision makers, you don't want to give them just one number for something and because that could go up or down and cause alarm, you want to make sure that they understand maybe some breakdowns in that information without overloading them with too much information. But showing that within these groups, that these are the goals that we want to look at or this is maybe even making suggestions about how you want to change your key KPIs  Adam: (07:06)In terms of goals and KPIs. Many times we automatically think of data analytics and data governance. So how does data visualization fit in with these when it comes to understanding data?  Cate: (07:20)Fantastic question because data governance data and analytics and visualization are all very intertwined and need to be thought about really as a whole when you're preparing presentations and also designing or having input into information systems. If you can visualize how you're going to present data, when you first think about where you'll get that data, how much detail is available, and how your reporting is formatted and what data is required. that's really getting into the analytics side of things because that's about, you know, how the data is designed what's out there for you. That also gets into spreadsheets and calculating ratios at the basic level, moving into design, reporting and forecasting. And all of those things are things that you probably have to visualize at some point with the data. So you gotta have the analytics behind it. And then with, with governance, it's really how that data is being captured. If it's being required to be captured, is there some kind of procedure that makes sure that it's getting captured the same way across the board by different divisions or different groups? If it's accurate, if it's contained securely, and if it's got integrity. I know you've probably all worked at places where sometimes you pull information from one system and it's a little bit different than from another system of your systems aren't the same. and that is something that, that you have to make sure that you're grabbing the data that is correct. and that it matches between systems. So visualization really a is something that, you know, you would think that's last. You're presenting all this data that's in your systems that you've designed, but you really have to think about it first. It's a strategic starting point and needs to be top of mind when you're thinking about what kind of data that you want to be looking at every day.  Adam: (09:36)So then how did you influence information system design to enhance data visualization,? Cate: (09:42)Influencing system design so that you have the data that you need to help run the business is one of your most value add talents as an accountant. I think my favorite activity as a controller really was that led me to pivot over to running implementation and account management services. Later on in my career was helping to design and improve systems. So any chance that you get or you want to be involved when your company is putting in a new system. Just a few years ago well the nineties, two thousands, it was more an ERP type of system that was going in or a customer and sales data, data system. And now the systems are more sophisticated, it's more predictive analysis and it's being created by a one or artificial intelligence. That's going to be the next big thing. It's already there. I don't know if any of you are using it yet, but starting to hear about it where you know, it's in the corporate boardroom. People may be in there presenting their information and the CEO has access to this artificial intelligence and it is also predicting things and giving in not only giving the CEO actual data that's happened, but predicting things. So it's kinda changing the game in there. So you really have to understand what that's all the systems how they're getting the data and what's happening there and making sure that what you are explaining or presenting is spot on with that data. I think more and more we'll see better accuracy in systems. We'll see. I think blockchain will help tremendously in that mismatch of data in different systems because that's going to make sure that that data is transmitted from one system to another in the correct way and an integral way. So I think you know, it's I don't know if it's gonna get easier. I think it's just gonna change in how you present. you could be in an in a meeting maybe it's not you presenting, but it could be, you know, the head of sales who's predicting some things or saying some things and then the CEO can turn around and say that, well my artificial intelligence or whatever they call, whatever he calls the reporting that he's getting is predicting this. And so it's going to become more of that kind of conversation of you know, is that, is everything driven from the data or are there other things going on that may be, are outside the data, but that's where you know, that system information is going to be coming more and more reliable and really understanding what's in there is is paramount for your career.  Announcer: (12:52)This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA'a website at www.imanet.org.

Mark's Article: https://sfmagazine.com/post-entry/april-2019-ai-new-risks-and-rewards/FULL EPISODE TRANSCRIPTMusic: (00:00)Adam: (00:00)Welcome to count me in IMA's podcast about all things affecting the accounting and finance world. I'm Adam Larsen and with me is my co-host Mitch Roshong. Our topic for this week's episode is actually based on an article written about artificial intelligence. Mitch, can you tell us a little bit about our speaker and what the article says?  Mitch: (00:18)Yes, absolutely. So I recently came across an article titled AI new risks and rewards written by Mark Nickerson. Mark is a CMA, CPA and MBA and is a lecturer for the state university of New York at Fredonia. I was interested in learning more about where the idea for the article came from and if Mark had any other insight into what kind of risks accounting and finance professionals should be aware of. He was nice enough to answer a couple questions for us. So let's listen to how AI could potentially increase finance fraud in the future. Mitch: (00:52)Can you tell us what led you to researching and writing the article, AI new risks and rewards?  Mark: (00:58)Yes. Thanks so much for having me. I wrote the article in response to a number of stories that I had seen recently, all of which seem to focus on the positives of utilizing AI, artificial intelligence or RPA, robotic process automation in both the finance and accounting industries. However, there was very little, if any credence given to what the potential negatives or drawbacks of instituting these technologies would be. Now,i'm not adverse to new technologies. I'm not adverse to being on the cutting edge of utilizing or implementing new technologies. Quite the opposite. However, I always want to make sure to play devil's advocate as well as take a realistic look at what the potential negative impacts are. I think it's always important in our industry to be proactive to what could go wrong instead of being reactive as we've been in the past now in these articles that speaks quite often about how corporations and businesses will use and implement and have already implemented AI in their respective finance departments or their internal audit departments and I believe wholeheartedly that those companies are seeing a large benefit. I cited in my article a recent MIT Sloan management review report where they surveyed 3000 executives and over 85% that they felt AI would give them a competitive advantage over those companies that were not using AI. And of those individuals, 79% felt it would increase productivity. I believe that they're correct. I also believe though that it opens up a brand new world for potential fraudulent transactions, potential accounting and fraud scandals that could go undetected for years or never be detected based upon the reliance of AI to find these things. And what I mean, there circles back to what AI really is in artificial intelligence. While I'm not a technology expert, I can break it down and have had it explained to me many times in a simple format of artificial intelligence does learn, but it doesn't learn on its own. It learns from you and I, it learns from millions and millions of data points that it is fed through in analyzing information. Those data points come from situations and occurrences that have taken place where humans have been interacting in some facet of the data that we are then feeding through the artificial intelligence because humans have interacted or touched some portion of that data point or that transaction. Human bias is inherently being fed into these technologies, into the artificial intelligence, into these quote unquote robots. And I cite a couple of studies in my article, one of which took place in the university of Virginia where a professor down there was utilizing AI and determined that it began exhibiting sexist views of women. simply again, based upon the data points containing human bias and human bias. Unfortunately, still today being skewed towards towards sexist views towards a female gender. Another study this time at the University of Massachusetts showed that a AI was able to put learn in quotes again because it does take it's lessons or it's education from human interactions. But AI was able to learn from these data points to essentially exclude African American individuals from data sets that were used for important items such as polling information, based upon their vernacular. So it was able to learn and essentially pull those data points out of the data sets. My concern then is the human bias that led to the large accounting and financial frauds in the late nineties and early two thousands such as greed and power and seeking to meet quarterly goals and sales records. Those issues will still be contained within data points, those biases that have been exhibited by humans for hundreds of thousands of years will essentially be contained in the AI and how are we as auditors, as accountants, as financial professionals, ready to combat that? I think that anybody who sees the articles that have come out on how AI has taken on these previously unprogrammed racist and sexist and biased views and does not think that items such as greed are essentially inherently contained in these transactions as well are not focused on the potential impacts. What if AI does identify that greed or that meeting quarterly reports, meeting quarterly goals increasing market share, taking home more money? What if AI learns that those are all things that certain humans that are involved in data points see as beneficial and therefore AI derives the fact that it should do more of that. If it does, we could be an appoint where essentially AI begins committing accounting and financial frauds on its own if not even more concerning committing these frauds in a complicit manner with executives or individuals that have to programming those technologies. So I think the main result is we need to make sure that we're not losing the critical eye of the auditor or the critical eye of the financial professional. The executives that was an are inherent in Sarbanes-Oxley just to be on the cutting edge of technology or increase efficiencies to cut cost. That in my opinion, is the real danger.  Mitch: (09:30)What do you think accounting and finance professionals should do moving forward?  Mark: (09:34)Yeah, great question. So I think the issue becomes, again, that I am in no way, shape or form against utilizing AI or RPA or data analytics to increase efficiency. But we need to realize that those technologies are limited and we is the so called gatekeepers of our profession need to ensure that our reliance is still on our professional judgment and our interactions and our decision making because another point needs to be made that AI isn't as flexible as some articles and individuals make it out to be. Again, these data points need to be repetitive in nature and very numerous for AI to be able to make good quality decisions and process information accurately. So if there are situations in audit, in business, in finance that are not repetitive in nature or independent, we need to make sure that we as CPAs, and professionals are looking at all transactions to determine, Hey, that needs to be pulled out and that needs to be something that we make the decision on because it's not a frequent transaction or it's a little bit skewed from the norm, so we might not get a good result from the technology. I think it's imperative that humans continue to be involved heavily in all of the decision making and all of the analysis that needs to take place in our industry. The best benefit in my opinion is one where we are slow to implement AI and make sure that it's being implemented in the appropriate and also making sure that the AI is simply a supplement to the human decision making to the human capital. And we are working together with the technology to increase our efficiencies and to provide better decision making, better forecast, more accurate projections, but not essentially just relying on the artificial intelligence to take over what we're doing to cut costs or to take more off of our plate. The ideal world moving forward, in my opinion, is one where we are working together.  Announcer: (12:43)This has been Count Me In, IMA's podcast providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Richard Starkey:https://www.linkedin.com/in/richardstarkeyyves/CronosNow: http://cronosnow.com/our-why/Richard Starkey's suggested reading list: Tim Goodenough: https://timgoodenough.com/ Tim Ferriss: https://tim.blog/. Ray Dalio: https://www.principles.com/ Adam Grant: https://www.adamgrant.net/ Carol Dwek: https://mindsetonline.com/abouttheauthor/ FULL EPISODE TRANSCRIPTMusic: (00:00)Adam: (00:03)Welcome back to Count Me In and thanks for joining the conversation about all things affecting the accounting and finance world. I'm Adam Larson and I'm joined by my cohost, Mitch Roshong and today we have a very interesting episode to share with you for this week's conversation. Mitch, you had the opportunity to speak with the managing partner of CronosNow Richard Starkey.  Mitch: (00:21)Yes, I did. Richard Starkey is what he refers to as a serial entrepreneur since his teenage years. His passion for business and education came across very clearly and we were able to talk about how important accounting and finance skills are to starting and running a business. He is also a great proponent for lifelong learning and share some valuable insight into how professionals can learn and develop through their careers. I enjoyed the conversation and learned a great deal from Richard and I hope you do too. Mitch: (00:54)So Richard, please tell us a little bit about your background and how you ended up as the managing partner at Kronos Now.  Richard: (01:01)I started being an entrepreneur quite early in life. In my late teens, I started up a small kind of publication and I was actually riding horses for as a professional show jumper and realized I needed to make some money. So you know, started a couple of small businesses, nothing too sophisticated. And as I kind of got on in in my career I realized I needed a strong kind of finance background. So I studied accounting part time while working and running some small businesses and I did my accounting degree. And during that process I wandered off and became an operations manager for a large logistics firm, got into corporate finance and then really felt the shortfall of my technical finance knowledge. So then continued with the rest of my accountancy qualification or part time in my late twenties, actually. And once I kind of finished the qualification, I went back and did my internship and articles in my late twenties. I landed up in academics teaching financial reporting as my, you know, as my real teaching subject. And from that I grew into this quite a bit of an expert in financial reporting and later in corporate finance and a deal structuring for mergers and acquisitions, not a deal maker, more a, you know, a technical accounting and tax structuring kind of guy. And through that period I really just ran with academics, you know, sometimes more academics, less consulting, sometimes more consulting and less academics. But through that process a couple of years ago we did an education corporate finance deal where we brought and structured a couple of education businesses around the world. And by accident, you know, one of those deals didn't go so well and I landed up kind of holding the reins, temporary CEO for what was supposed to be for, for an interim period and landed at actually loving it and moved from technical accounting finance guy into CEO of an education business for good three and a half, four years and had to learn all the skills around strategy, building a larger systems and marketing. And in that process I had some wins, some losses, but I really fell in love with the idea of automating and developing processes from the front end marketing all the way to the back end accounting and last year off to some, you know, personal health issues in our family. We sold the business to take some time out and during the end of last year I realized I enjoyed the entrepreneurial space, not as as an entrepreneur but in helping entrepreneurs and that's where Kronos Now was born. And Kronos Now services and looks after my own entrepreneurial and my wife entrepreneurial activities from a systems accounting and finance perspective. But also we act as an accounting firm that we like to do, say there's more than accounting. And it's been a good, you know, first year and we're learning and helping small to medium entrepreneurs are doing initially their accounting in the most automated and efficient way possible, but then building that out into the rest of their systems and, and processes.  Mitch: (04:28)Well, that's great. Thank you for sharing that story. For someone who, you know, doesn't come from a necessarily traditional accounting background but you certainly put in the time with your studies and they chartered accountant. How do you believe that piece of your background has helped you in these executive roles that you assumed and then started.  Richard: (04:50)Such a good question. The reality is my accounting finance and specifically the auditing side has helped me understand the, the rules of the business games specifically around business process and risk. It has been a challenge getting out of just the process and a risk mindset when you start moving into the CEO and entrepreneurial state that understanding how businesses can build off of a good process is everything. That's the foundation, right? And quite honestly the auditing training has been exempt, just exceptional in supply me that skill sets.  Mitch: (05:31)Well, as you came from academia, right? And you kind of combined all of this accounting background and learned kind of on the go. How would you recommend, or how do you kind of see the needs of accounting, education and accounting preparation changing based on, you know, where today's business world is, as you previously mentioned, automation.  Richard: (05:54)Oh, accounting and systems or computers and AI. I think, you know, the level of understanding of computer systems and even programming for accountants is going to need to increase drastically over the next five to 10 years. And that's the one skillset I miss all the time. I've always got to rely on a program that even to do basic integrations and, and system checking.  Mitch: (06:18)Now my next question is kind of what's next, right? I mean, you are in academia, you talk about educating students, educating entrepreneurs, assisting accountants today. You know, once you have that education, you have your qualifications. how do you progress through your career? What are the next steps?  Richard: (06:39)I've mentored quite a few of my students as well as my previous financial managers, et cetera, on this kind of journey. And I see two broad forks in the road at some point, you know, I went through both of them so they don't have to be, you know, one choice forever. It can actually be, you make one choice now and five or 10 years locked on the line, you make a different choice. But I see the full calls, you know, one move career wise being in becoming a specialist. So he became a US guy and apply for his financial reporting specialist, the tax specialist, a system specialist, IT auditor. That specialism is, you know, you become the smartest person in the room on a small area of knowledge and you get paid very high fees to do that work. Very rewarding. I made a lot more money doing that than I ever have as much veneer. But hopefully that'll change the other fork in the road is to become a manager and a leader. Right. And those are two different things and something which we're not trained very well in as accountants. So, and that often starts as we start managing your finance team. You know, you stop being the person doing all the accounting work and you start managing an audit team or a team of accountants and managing a team requires us to learn about leadership and that can ultimately also evolve into moving out of the finance function. Yeah, the, I still believe accountants and finance professionals make the best chief operating officers and best CEOs. Well, we've got to shift and really learn how to grow human talent. And that requires you to become a coach. You know, it's so much more than just managing, managing is just lab deadlines and tasks and crack the whip until it happens. Whereas leading as understanding people, how do you grow them, how do you get the motion on them and how do you do that sustainably? That's been the area I've been really short time. And with that move into the CEO entrepreneur side, I'm also realize that as accountants we are very focused on the, no you can't. This is the risk we could at identifying risks. Whereas we, we actually have the best opportunity because we understand the rules and the risks to look for opportunity. So that mind shift to look at your risk not as a no, but as a opportunity. How do we mitigate their risks? How do we overcome that risk? And I found that skillset needs a marketing skillset. I'm working more and more with young accountants who qualify and they, this is their first journey and being entrepreneur, they want to get out there and start their own business. So I want to jump straight into the leadership straight into the innovating strategy space. And whether it's a small business opening a restaurant or you know, starting a tech company with some friends. The reality is we need to learn how to do marketing. And the cool thing about marketing these days is data-driven. It's all actually reporting it's inputs. There's processes, it's a science. And I'm still learning, I'm still a little confused to still feels like dark magic at times, but it actually suits our skill set very well now it's not about these abstract branding and imagery and perception issues anymore. There's real data, especially with online marketing world. And I think accountants, once they get into that skillset and learn some of the basics can actually Excel because we understand process inputs, controls, process output, and we trained on that. So if you, you know, you're doing accounting and you want to get into your own business as quickly as possible, we'll start today, you know, start a little blog, see if you can drive traffic to it and start a little drop shipping store, find a product, repackage the coffee and sell it, you know it doesn't have to be your forever, but you can start learning how to do marketing today while you're still studying or while you're in your accounting role.  Mitch: (10:30)I'm curious now with all of that knowledge and those recommendations, how have you seen the technology really play a role in your businesses? Particularly what kind of efficiencies have you realized at Kronos Now thanks to automation?  Richard: (10:49)So I'm gonna start with the boring kind of numbers, outputs, you know, the amount of time span driving down costs. Actually in my previous business, senior education, you know, we had 300 staff across five countries. And in that space, you know, we took three years and we took a business that had full five, six different systems and created and efficient automated and interlinked system, which are very smart IT guys. There were partners in the business called the cubits where we literally reduced workload on processing a student's registration, ongoing operations, you know, their submissions, their interactions, their invoicing, their collections, all of that process that was previously done manually. I would say we reduced the human interaction on a student's lifecycle, a student being inclined by a 60, 70%. And that's just the one for one.Where you look at, there's additional workload created a, because every time there's a human capturing an invoice we've already got information already captured on the CRM, on the operating system. So you duplicating data capture and you also making errors. So there'll be reduced to 60, 70% just on a normal work. So the time requirements by humans, we actually would use to buy more because that doesn't take into account the amount of time fixing, reviewing, fixing. Again, human errors. So that is my personal internal experience. Kronos Now is currently working on a company here in South Africa that's a manufacturing organization and we have literally in a staff of 30 people, of which six of them are Edmund staff by setting up a one centralized database that drives all the systems. We've got rid of all the manual sales orders, invoices, quotes, we've automated the customer order that goes to a production order that automates the invoice, the accounting system that's used the zero pools, the bank statements automatically and matches the customer receipts against the invoices, which feeds back to the production orders and the shipping documents. All of those steps used to be manual, so lots of errors, you know, and lots of time wasted. We've reduced the requirement by, you know, the company's requirement by three or four Edmund Clark's already. Now your company's great. It hasn't retrenched. It's kept those people to reallocate them to other resources as we grow the business. The softer side has been the managing people, you know, with automation we have real time data. We can have kiss dates of accountability and KPIs for people. And that's not just the crack the whip, but it also identifies where people need training, when processes need to be improved so that people are more effective and efficient and managers have the proper tools to identify shortfalls for either training or disciplinary action. So the benefits are so much beyond just the, what you can quantify in a spreadsheet. And all of that also then leads to what we see specifically with Kronos Now clients now is that the small business who's run by the founder, these are businesses that you can picture or less than 5 million turnover, less than 40 staff that business owner has, is the controls on the business, right? They live in that business. They check all the bank statements every day. They have to sit on the production team by giving them proper data that they can rely on the controls and the data that's been fed back to them in your real time as well as error reporting. So they don't have to check everything. The system will thread errors and inform them, proactively send me those founders start getting freedom from their business.  Mitch: (14:57)For those who are maybe just starting in their careers maybe progressing through their careers or want to start their own business. What advice do you have for these accounting and finance professionals in today's industry? With this automation available to them and the skills and competencies needed? How would you recommend they progress into their futures?  Richard: (15:24)I think the first thing is that they need to read you know non finance stuff. They need to read from good authors in order to figure out what they value. The long gone are the days where you went and worked for a company for 40 years and you were happy with the paycheck, right? And the stability. Stability is a bit of a false TV thing, right? You need to be adaptable. You need to, you need to be happy in what you do. So what I found most of my accounting staff, most of my accounting students, and it's a big generalization stuff to give me an advance, but most of them really benefit from reading as a starting point. Carol Dweck book called mind States. So accountants are generally drawn into the accounting profession because the a type personalities and it just fits well, right? And that is changing granted, but it's still a big number of people who are drawn to the accounting profession. And that fixed versus growth mindset is quite important for all of us as finance professionals to understand and to start working towards a growth mindset. And with that being said, I think the thing is to learn, so let's face it's accounting. You land up in some type of internship or apprenticeship that you feel a bit better about sometimes. Now you feel you're underpaid, overworked, the work isn't as exciting as you would think it might be. But in accounting you're exposed all these systems and processes and other managers or the businesses, most inner, most finance details, which other people don't get exposed to. So you can learn in that process from the business managers, from the entrepreneurs that are running the businesses that you do the finances. So get down and read, trying to figure out what it is you want, post your qualification. And that I find comes from looking at your own principles and your own values. No. Are you wanting to be a specialist or are you wanting to be an entrepreneur? Do you want to, you know, go into a big corporate, do you want to go into a small business where you're your own boss? And again, read, read, read. So the, the books and people I suggest are Carol Dweck. As I said, I'm a big fan of Adam Grant. Yeah. His book give and take was quite, you know, quite fundamental to me as well as in his new book on entrepreneurs, which is a great study saying entrepreneurs actually more successful if they're not Cowboys. They're very risk averse people, but then manage risk really well in their personal lives. And then Ray Dalio, once you get into a management position, the Ray Dalio book on principles was really good. So I think read, read, read, get exposed and listen and learn to as many businesses, entrepreneurs, or people that you want to be like Identify the people who you see you would like to become more like. Align that with your principles and values and see how you can serve and give into that space because the world is much bigger than spreadsheets and financial statements. That's your starting point. Great starting points. Most of the rest of the world was confused by those, but it's a starting point to your career, not the ending points.  Announcer: (18:41)This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you liked what you heard and you'd like to be counted in for more relevant accounting and finance education, visit website at www.imanet.org.

FULL EPISODE TRANSCRIPTMitch: (00:03)Welcome to Count Me In, IMA's podcast about all things affecting the accounting and finance world. Mitch Roshong and Adam Larson here with you again and today we are going to hear all about how blockchain works and how it applies to accounting. Now, Adam, can you give us a little more background on the topic?  Adam: (00:17)Yes, thanks Mitch. Some of the biggest curiosities and ongoing questions in accounting revolve around blockchain. To get some insight on the topic, I asked Dr. Ariel Markelevich to help us answer a couple of the most common questions. Dr. Markelevich is an associate professor of accounting at Suffolk university. He has written a number of articles for academic and professional journals and has presented much of his work. I think you're going to learn a lot about blockchain. I certainly did. So let's take a listen.  Adam: (00:52)What is blockchain? And do accountants really need to care about it?  Ariel: (00:56)Thank you. That's a great question. So many people have heard about blockchain, and I'm guessing that many people don't really know what block chain is. So block chain is essentially a technology. So when you think about blockchain, you typically think about a list of individual records. So, many talk about the ledger or a distributed ledger. In essence, it's a list of individual records. Now the records can contain any type of information. So when you think about blockchain in the context of accounting, it could be transactions. When you think about a blockchain in the context of Bitcoin, it again could be transactions between individuals. Now what is unique about blockchain is that it forms a chain by the name. You can get that. So there are the key thing to understand is that there are many types of books and systems. The basic process in a blockchain system is that each record would include some information. As I said, for example, a transaction and it would contain a digital signature for each of the parties. Now the records, before added to the chain, they're checked and they're approved. We'll talk a little later about different ways to prove the records, but in essence, they need to be checked and approved before they're added to the system. Once they're approved, they're record is added to a block and then the blocks are in essence linked to each other and create the chain and we get the block chain. Now there are other common characteristics of blockchain. One of them is that it uses group cryptography. So instead of just having the information there we go through a crypto process to create what's called the hash, which essentially is a list of digits and letters that represent, in essence, the record, you can also think about it is the key to the record. Now the hashes connect the records and the blocks together in a specific order. If you were to make any change to the record, that would cause the hash to change as well. And hence you would know that there was a change in the record now because the next block contains still the old hashes. If you wanted to hack and change a potential record in the system, you would need to change all the subsequent records. Because again, all of them contain the previous hashes for the previous records. And that makes it hard, which is one of the key advantages or interests in blockchain. A key thing to understand is that blockchain is not Bitcoin. So many have heard about Bitcoin, which is a cryptocurrency. I'm guessing that some of you are sad that they didn't buy Bitcoin years ago. But anyway, Bitcoin uses blockchain. Blockchain's was introduced when Bitcoin was introduced, but the two are different. So the way Bitcoin uses blockchain is just a specific use for blockchain. And in many cases, when you think about blockchain, blockchain could be converted or used in a variety of different situation and variety of different settings and not just the one that Bitcoin is using. So for example, the Bitcoin use of blockchain is what's called a decentralized or a Galatarian network. The basic idea there is that there's nobody in charge of the system. There are many users within the Bitcoin blockchain system. All those users or nodes, sometimes that's the technical term, but again, no central authority. You don't need to get approval from anybody to join the system. In the Bitcoin network. The members are kept anonymous. Now I'm saying all this because you need to think about blockchain for potential business uses. And for example, you may not want to keep the blockchain system decentralized or egalitarian. You may not want to keep the members anonymous, but the fact that Bitcoin is using it that way doesn't mean that all blockchain applications would be the same. Another characteristic of the blockchain use in Bitcoin is the fact that transactions are approved by consensus. So in essence, what you have is you have what's called miners. Many of you have heard or potentially heard the term minor. A minor is somebody who is part of the blockchain system. Again, we're talking about Bitcoin specifically and they approve the transaction by solving, a variety of mathematical equations essentially checking that the hash represents the information in the transaction that is being uploaded to the system. And you have many miners that are trying to solve this equation or sets of equations. And the idea here, the reason for the miners to try and work is because they get paid in Bitcoin. So many of you have heard, that potentially the payment is going to be reduced in the future, things like that. But in essence, the way it works now is that miners are paid using Bitcoin for the work they're doing to approve the transactions. Again, since many there are many miners out there and the approve the transactions, it is approved by consensus. And what once it's approved, it's added to the system as we were discussing before. Now these characteristics of the Bitcoin application of blockchain may not be a good fit in all implementations. So as blockchain evolves there are other types of blockchain systems that exist. One example is the Hyperledger which is a consortium of companies that is developing an open source blockchain. So one question that comes up out of this is, okay, should accountants care about blockchain? So something that old transactions can be on a blockchain. So imagine a case in which the blockchain would include all the transactions that accompany has. Everybody would have access to that information. We can think of a case in which, and there's actually some, some academic research that talks about this, that users would have access to all these transactions and could use some software or some code to create their financial statements. Auditor's would have access to it and things like that. Personally, I don't think that would happen. Companies are not likely to be willing to share the information of all their transactions with the world. So I don't think things like that would happen. Just again, it doesn't make business sense. Now, it is true that blockchain systems can be used for some underlying relationships. So for example, when you think about your businesses, transactions with customers or suppliers, we could have all our supplies on a blockchain system. The idea here are the advantages that is that all the transactions will be recorded there. Now the approval would most likely not be by consensus. Maybe we do a two party verification. One of the attractions is that it could make it easy for some smart contracts. So, for example, if you think about a contract in which I promise to pay you, once you deliver some shipment, let's say we could have all that information in the blockchain, once that shipment is approved and it is received, the payment, I flag it as is the shipment being approved or received again and the payment is made automatically. So I don't need to send the invoice, I don't need to call you and ask where the money is and that could simplify things. So you can think about some blockchain applications that would be attractive and could have some impact on the accounting. Now what would it mean in the future? Would it mean less audit work because they'll be some two party verification for their transactions? Maybe. Would it mean continuous auditing? Like some are arguing that because all the transactions would be out there, auditor's can continuously audit the financial statements instead of doing it quarterly or annually. Maybe. I don't think so. Would it result in financial statements on demand? As I mentioned before, again, I personally find it not particularly likely. Would it mean nothing at all? Actually, maybe. So keeping mind that blockchain is again, just a ledger, just the list of transactions. They're proved they're more secure, they're harder to change, but they're just the list. What technology would bring it to the business in the future? It still remains to be seen.  Announcer: (10:57)This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you liked what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Dan Smith:https://www.theorylane.com/ https://www.linkedin.com/in/daniel-smith-data-scientist/ Dan's Work: https://www.linkedin.com/pulse/acid-just-sweet-80s-jeans-datapossible-daniel-smith/ Visit Dan Smith's work on Github: https://github.com/thedanindanger#datapossibleFULL EPISODE TRANSCRIPTAdam: (00:03)Hey everybody! Welcome to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I'm Adam Larson here with Mitch Roshong. And this week we covered the topic of data analytics and emerging technologies in accounting and finance. Mitch, can you tell us more about it?  Mitch: (00:16)Thanks Adam. Yes. So earlier this week I had a great conversation with Daniel Smith. He is the head of innovation and founder of theory lean integration solutions. I reached out to Dan because I wanted to ask him a few questions about data analytics as it pertains to accounting, but our conversation got so in depth, we ended up talking for well over an hour. Dan offers a great perspective on the impact technology and data have on the accounting and finance world. I really enjoy talking with him about these topics and I'm excited for you to listen to the first part of our conversation. Mitch: (00:54)Being that technology seems to be very disruptive in today's world between the jobs that it's overtaking and the economy. Many people seem to be a little scared about these emerging technologies. So my question for you, in your opinion, how do we as humans prepare for a future that's kind of dominated by this artificial intelligence or machine learning, blockchain, all these buzz words like, that. Daniel: (01:18)I get this question a lot, Mitch. It's an excellent question and a valid concern for anybody who's worried about that or who is kind of on the periphery of this space. I will tell you, anybody who's deep into this space is not that worried about it. You'll hear a lot of doom and gloom and fear, uncertainty and doubt and doubt being spread. This world that's dominated by artificial intelligence, machine learning, robotics, blockchain, whatever word you want to use for it isn't as different as people foresee it to be. AI machine learning. Those solutions aren't giant monolithic replacements for humanity. If you think about it as any time that you repeat an action, something that you do over and over again, if you try to speed it up and you feel like, Oh, I'm gonna get so fast at doing this. I know all these keyboard shortcuts and I know all these things and I'm going to optimize this. That's a optimization problem. That's a locally optimizable solution. Those are the types of things that AI can do well. It can make a little bit of problem solving for itself. It can make slight judgment calls, but it can't deviate from the path that's been set in front of it. Look at it as a intern if you will. You get an intern to do a single thing really well and make a little bit of judgment for itself. But the second that there's a deviation, it's going to spill coffee all over itself or do something that's a mess. AI is exactly the same way. So we can think of ourselves as we learn programming and as we learn basic technical competencies, we'll figure out how we can act as managers for AI and how we can have the business itself be focused on deployment of these small applications and these small things to help the business. It doesn't hurt us. We just have a different skillset that we're using to benefit the business or benefit or even do business for us. So it's not scary. It's just a little different, which also can be scary until different is normal and now it's not scary anymore.  Mitch: (03:54)That's right. So I kind of see this from what you're saying is we need to look at this as more of an opportunity rather than something that's scary. Daniel: (04:03)Absolutely. We should always be learning and developing our skills. This is just another opportunity to learn and when there's an opportunity to learn, there's an opportunity to apply it and grow our career.  Mitch: (04:18)That's a great perspective. I really think you know, a lot of publications coming out now, you know, there's a lot of articles and a lot of research that's going into this and the more tools that are becoming available to us you know, it's more stuff to learn. But again, it in my opinion, looks like it could potentially increase jobs and, and create new ones. So I know the whole field of data you know, we talk about financial data more or less in accounting. But I think there's other data that goes into, you know, a successful business. So my question to kind of follow up on this at what point do you kind of see maybe an organization suffering from what people are saying is like a data overload? How do you figure out what's really meaningful for your business and what should be used with all of these new opportunities?  Daniel: (05:14)Hmm so this is a great question and another one that I get a lot. Okay. Every question is a great question to me because if somebody's asking it, it means that they're interested. So I love, questions, period. A lot of people don't even bother to ask. I digress, though. I don't actually look at it as it being anything different in the emphasis on data. Any accountant knows that data is the lifeblood of an organization. If anybody me present, I always talk about the data creation to value process. How any stakeholder or business activity creates data in some form or fashion. What we used to do and nobody thought anything of it was we would have our general ledger, our general ledger would take all the purchases and sales, the activity, payroll, et cetera, all the activity of the business, put it into a transactional system, a general ledger. We would then take that information and we would clean and shape it. We would aggregate it into our various financial statements and financial reports that would then subsequently be used by business specialist to make business decisions based on that information. Say what volume of inventory should I order in support and correspondingly, what should my sales budget be in order to sell that inventory? That would result in our sales and marketing mix. That sales and marketing mix would then result in stakeholder activity as they purchased products, resulting in more information that would lead to other business decisions. It's the same thing we've always done. It's just a little faster now and we're learning. If we can generate more data, we can create more opportunities for making business decisions. Sometimes that needs to be accelerated and the problems that are being created that need to be solved through having all this data no longer fit within the traditional bounds of an organization. Remember, all the organizational specialties that were created were as a result of what is effectively the accounting information process. We only were able to put paper on a spreadsheet or a t-table or a clay tablet, all of which are proxies for the same thing. Now that we're in a digital environment, data has a whole new way of moving around. So we have to reorganize. We have to have these cross functional specialties or even completely new functional specialties. Data science is the mechanism by which we break down the barriers, traditional barriers of business information and create an entire new organization structure. Companies are not actually being that overloaded with data. It's the same amount of data they always had. They're just able to do new stuff with it. So they're having to change their entire organizational behavior and structure to adjust to it. It's that was a very long answer to the question and I think I answered a few other questions with it.  Mitch: (09:13)I was gonna say that actually that kind of leads into my next question and covers a little bit of it, but because so much of this data has historically been rather financial I know there is a big focus on operational data and more of the qualitative aspects of the business. So I'm just curious if you have any experience in improving business because the organization was able to see something based on analyzing the qualitative data that they have in front of them now.  Daniel: (09:48)Yeah, qualitative data in my world, it's funny. qualitative data doesn't, I hate to say anything that's definitive because it doesn't really exist, but I think, I think that there's definitional difference cause they're saying that it's qualitative as opposed to raw financial data. And if I understand the question correctly, is that what they're considering qualitative?  Mitch: (10:26)Yeah, I believe so. Yeah. More and more of the the operations as opposed to the dollars.  Daniel: (10:31)Yeah. Okay. Okay. That makes sense then. So like a HR survey or maybe even something really qualitative, like the sentiment of emails or tweets. Got you. Okay. Yeah. The trick then, if I can pivot the answer to this a little bit the trick with any qualitative data is you stop making it. So qualitative you try to put as much of a sense of objectivity as you can so that there's some quantitative value to it. It's half of analytics and data science isn't knowing the right tool for the job. It's being able to shape the problems so that it fits the tools that you have. What you'll see a lot when it comes to that type of qualitative data are a, what are called natural language processing tools. I've used them a lot in the past in marketing engagements where you'll use sentiment analysis, natural language process called sentiment analysis, which will look up either a dictionary words or similar words. You can, you can apply math to terms and sets of terms to see if they're similar to things that are generally positive or other blocks of words that have been labeled as positive, to assign a general sentiment. Are they angry? Are they happy, are they supporting this activity, et cetera. With that value. Now we can use those in traditional models to say that, well, when emails to HR have a general positive sentiment, we feel that our productivity increases over the next few weeks. So we should identify what patterns of behavior resulted in those emails so that we can enhance productivity or when this, when we use this particular marketing, we see the sentiment of tweets increase in this region. Correspondingly, we saw an increase in sales. There's a bit of correlation and causation there that you also have to tease out. But the story itself is that when we've been able to influence and when able, we've been able to see a market increase in that subjective or that qualitative behavior of our audience. We're stakeholders. We've been able to also demonstrate a quantitative effect of that qualitative information.  Announcer: (13:28)This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you liked what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Andy's Finance Training Website:https://www.superchargedfinance.com/free-stuff/Contact Andy Burrows:https://www.linkedin.com/in/andrewburrows/ FULL EPISODE TRANSCRIPTAdam: (00:03)Welcome back for another episode of count me in Adam Larson here along with my cohost Mitch Roshong. As we look to cover all things affecting the accounting and finance world, our topic for today is highly relevant. We had a great speaker, join us from the K and talk to you, Mitch, about strategic business innovation. How did the conversation go?  Mitch: (00:18)The conversation was great. Andy Burrows is qualified as a chartered accountant in the UK and then moved from public practice audit to big business finance. He was quickly promoted through the ranks to finance director at the age of only 29 and has since worked in various sectors of business, including energy professional services and software. Andy is truly brilliant and had a lot of great stories to tell. So let's take a listen to the conversation.  Mitch: (00:43)What is a strategic business innovation?  Andy: (00:52)Sure. Well, I guess first of all, I started using the phrase strategic business innovation to talk about a big change that transforms the business in some way. But I'm not too specific. When I started using that phrase at all I wanted to do is distinguish from innovation in the finance function itself and look at what's going on outside of finance in terms of innovation. I guess secondly if you look at the definition of innovation in some published material, innovation is like translating an idea or an invention into something that creates value that a customer will pay for. So it's customer-focused, you know, for example, online banking or online grocery shopping, it makes customers lives easier or online shopping, like Amazon or even iPods. It just makes customers life's easier than it was before and I guess I'm not just thinking of technology, I think I'm open to thinking about other transformation ideas as innovation. Things like you know, for example when Southwest airlines brought in the 20 minute turnaround, it wasn't necessarily technology based, but it saved millions of dollars and it was transformational in terms of their business and enabled them to sort of dominate as a low cost airline for a number of years. So it's kind of transformation and new ideas for value creation within the business rather than within finance that I'm thinking about when I talk about strategic business innovation.  Mitch: (02:44)And then in your opinion what should a finance professionals attitude be towards strategic business innovation?  Andy: (02:56)Well, I guess start by thinking about an example of like blockbuster. It's an old example. I guess to reiterate blockbuster video could have had the chance to buy Netflix for about $50 million in the year 2000, but they refused. I think Netflix were even the laughed out of the board room. But a few years later, obviously blockbuster went bust and Netflix is now worth, it was about $30 billion when I last looked. That's incredible. And it's one of those examples. I mean, why didn't blockbuster want Netflix? And you know, I will say is because they weren't interested in customers except to make money out of them. So anyway, it's a big case study, but a and best not get sidetracked. Our main point in mentioning it is as a finance person, you don't want to be working for the next blockbuster or the retailers that are going out of business because of Amazon and so on. So that's why we're going to pay attention really to the likes of blockbuster and innovation. The other thing I'd say is that finance, and this is my slogan over the last few years is mainly in the business to drive performance. So finance has got to take to find this is going to care about the success of the business and we've got to desperately want to help the business to succeed and avoid failure. So we've got to have an open mind when it comes to innovation. We don't want to be the ones to say no to the next Netflix or Amazon because we were too risk averse. But at the same time, we don't want to support a repeat of the dotcom bubble, which had very little substance and was fueled by excitement and people throwing money at things just so they wouldn't be left out. So I guess that's the kind of balance for you I'd encourage for finance professionals with innovation.  Mitch: (05:13)Sure and just as an aside to that, it was your article I came across on LinkedIn about the blockbuster and Netflix and that's what really interested me into bringing up this conversation and learning a little bit more about your mindset because it seems, you know, 20, 20 hindsight, right? You come across situations like that and it's just unbelievable to look at those numbers and the opportunity missed. So as finance you know, look to support innovation as part of their business strategy what kind of advice do you give those who are considering, you know, maybe a little bit of a riskier initiative as you said, or something innovative for their organization that's a little bit outside the box. How would you kind of coach them through that?  Andy: (05:56)I think the first thing I'd is make sure you don't stifle research as far as resources in the business permit. Just allow and encourage research into new technology and new thinking and even research into competitor activity, you know, keep tabs on what competitors are doing and it may take a long time for that research to yield any results. And actually it's impossible really to do a business case for it because it's like we're researching to find out what we don't know yet, so how can we say what the returns are going to be? But we've got to give that like I said, as far as resources permit, we've got to give that that opportunity to do that. but it's important to, for those people involved in that, to know that what the purpose is, is to work out what new things could benefit the customer and that we should listen to those views really when we have strategy discussions. The second thing I'd say is related to that, we'd have to be careful not to kind of stamp out innovation too quickly on the basis that the business case doesn't stack up. You know, you could argue that online banking may not have had a very good business case if you measured it up against the do nothing scenario because all it was was a new technology. We're an offering new accounts or it wasn't gonna particularly you know, move people from one to another. But the fact was it was going to keep customers from going going away because of the technology used by competitors. So it wasn't a fair comparison really to say you know, to compare against the status quo. I suppose the fair comparison would be, what if we don't do it? That's a different ballgame. So you know, can we afford to let our competitors do a better job of serving our customers? So you've gotta think of it that way rather than just say you know, think of it in isolation.  Mitch: (08:28)Well, as somebody who solely does their banking online, I'm very happy to see that all of these banks made that transformation. So great example once again now and, and I believe you did write something on that topic as well, so, yeah, that's true. Yeah. I appreciate all of this insight that you're sharing with us. My next point here, my next question I should say as we look at how organizations and businesses are transforming finance, the function itself is supporting this, but how do you see the finance role transforming even further in the future?  Andy: (09:04)I think finance is going to be about more about decisions and business performance management. And I've sat in a number of forums that this is the kind of thing that has already transformed the CFO role in general terms over the last few decades. Not innovation specifically, but big change, you know, global communications, travel technology, all these things that increase competition lower barriers to entry, increase opportunities increased the speed of change and the way I put is that to cope with all this, the business as needed, a numbers guy at the heart of the business and the CFO is in that position to be that person. And now the CFO. It's, you know, the pace of change is just so fast that I think even the CFO is getting overwhelmed. And what the CFO needs is the finance function to step up and help with that decision, support and business performance management being the numbers, people at the heart of the business to help with that change competition and the way the whole global economy and markets are moving so quickly and it's, you know, things are gonna move away I think from accounting and go more towards business partnering. I say that I hesitate really saying that because I do think we need to do more business partnering, but at the same time, I can't see accounting going away. It's still really important that, we're grounded in, in accounting. That's, and in fact, that's what enables us to learn about the business and become better business partners. So I think in terms of the weighting of our roles, it's going to become more business partnering, more decision support and less accounting. But accounting, it's not going to go away.  Mitch: (11:12)Right, right. Very well said. So I've mentioned or referenced a couple of your articles already and I know in talking with you leading up to this conversation, you know, your experience, your knowledge is vast. So in addition to all of these articles, I understand you've started your own online venture. This is a finance training website, is that correct? Yeah, that's right. So supercharged finance, what is that all about?  Andy: (11:42)I think basically it's going to be all about it's, it's online, it's online training for finance professionals who want to learn how to use their skills to add value in the business. So it's not, it's not like a Excel power BI training or you know, updates on IFRS's this is how to add value in the business or what skills and and what not you need as finance professionals to do that. So that's what superchargedfinance.com and I'm building that up at the moment.  Mitch: (12:20)Well, that's great. And for the listeners, as I said, the articles that I've read and the conversation we've had today, I highly recommend it. So we certainly appreciate your time today, Andy. And before we go, before we wrap up, are there any other points you want to mention?  Andy: (12:38)I think just one final point. I mean this is a good way to wrap it up. I guess it's just to reemphasize one point. As finance people don't sit on the sidelines, just spectating the business as it's struggles with innovation. Don't just feel like the commentator, like the sports commentator up in the stands, watching everything happen and kind of tutting his various ideas, crash and burn, get involved. Show your business colleagues that you with them and you want to use your financial and business knowledge to help the business tread the best path to success. So you know, be part of the business and not standing over the top just looking in and spectating. I guess that's my final points of summing up really.  Mitch: (13:30)That's a great way to wrap things up. I certainly agree with you. And one more time. We thank you very much for your time today. Thanks very much for having me. It's been great.  Announcer: (13:41)This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in from more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Dr. Sean Stein Smith:https://www.linkedin.com/in/dr-sean-stein-smith-dba-cpa-63307444FULL EPISODE TRANSCRIPTAdam: (00:00)Welcome back Count Me In. I'm your host, Adam Larson joined as always by my cohost Mitch Roshong. Today we have another episode about the captivating topic of blockchain and who better to listen to about this topic than Dr. Sean Stein Smith. Mitch, you talked to Sean. How did the conversation go? Thanks Adam.  Mitch: (00:18)Yes, Dr. Sean Stein Smith is an assistant professor at Lehman college in New York, but he is also on the advisory board for the wall street blockchain Alliance. He does countless talks on blockchain and recently received the NJ CPA 2019 ovation award in innovation and our conversation, we talked a lot about blockchain but we also talked about other technologies and innovation which we'll get to in future episodes. Let's take a listen to the first part of our conversation.  Mitch: (00:45)Blockchain is a very hot topic when it comes to emerging technologies and as being brought into accounting very frequently, however many do not fully understand the different types and options for blockchain. Can you please explain that to us? Sure. Thanks. So  Sean: (01:06)Obviously the whole topic of blockchain, cryptocurrencies and that whole sort of blockchain space is arguably the hottest topic in accounting and finance for the last 20 years. Right. But it's always important to know sort of what exactly is being talked about, whether it's being talked about internally inside the firm or externally, right. Offering advice or some services to our external clients and partners. And sort of the term blockchain is tossed around a lot, but it's really more of a umbrella term than one point of data, right? Because a blockchain can be a public blockchain, it can be a private blockchain or it can be a consortium blockchain or basically sort of a joint venture, right? And so a public blockchain basically is the true idea of a blockchain. It's totally open source, decentralized model of storing and then sharing information in a encrypted manner. And it's the type of blockchain that is probably what most of us are going to think of in our conversations and is also the type of blockchain net underpins Bitcoin and Tther. So on top of being the biggest option out there right now in terms of active users, in terms of you know, individuals and and, and all the rest. It's also the probably the most high profile one. Now from an enterprise point of view though, having all of the corporate data on a blockchain, right? And please don't forget, even though the blockchain is a unhackable or it has been unhackable as of right now having your information stored on a public blockchain is going to give some corporations pause. Right? So and on top of that though, the actual way that blocks of data are added onto the blockchain, the proof of work model is awfully tough actually do because it takes a lot of hardware, software and also power, right? So really from a enterprise point of view, public blockchains are moving out of favor and it's pivoting towards more of a private model or a consortium model. So a private blockchain is basically a, it's almost like a traditional ERP or a application hosted inside a affirm, right? Cause it has the traits of a blockchain, meaning that it's a group based model, basically, that it's immutable in nature and that it's a permanent record. Basically after data is added onto this blockchain, it's a permanent record, can't be altered on that block by block basis. And sort of the best example to highlight this is the joint venture, right? Or the joint venture model built up by Walmart and IBM. So basically in that context, Walmart is the organizing firm and so has organized the actual blockchain, hire the programmers and all of the coders to actually build it out and isn't pushing that out to its network. And so that's, that's almost like a hybrid model, but it's more like a traditional ERP or augmented by some blockchain traits. And sort of the third big, bucket is a consortium model. And the best way to sort of think of this or to highlight this is to almost think of it like an industry focused option, right? And it can be retail, it can be healthcare, it can be food safety, it can be finance or accounting. Right? And so the big four firms have actually partnered up to form a consortium model or a joint platform basically to help them audit information out of banks. And so this consortium model currently is being used and tested with 20 banks headquartered in Taiwan. So it's going to be interesting to see sort of how this whole field evolves, right? Because all of us who got interested in blockchain probably via Bitcoin, right? And sort of that's a public blockchain model. Totally open source for, any company to join or to be a part of. But from an enterprise point of view, again, for me, the accounting and an audit point of view that's really not as helpful as a private blockchain. And again, a private blockchain is more like a traditional ERP system augmented by some traits of a blockchain. But the area that I'm most interested in going forward is this idea of a consortium model or basically a industry group or a focused type of blockchain for a certain industry. Again, be it accounting, healthcare, finance is not really as important as the idea of a common platform to store and to actually transmit data in a manner that is encrypted and safe. Right. Both for the institutions involved and their end users.  Mitch: (05:58)That's great. Thank you Sean. Now artificial intelligence or AI is another major focus in accounting when it comes to technology, but what is the difference between AI and RPA in terms of accounting purposes? Sean: (06:12)So the field of AI, right? It's been talked about in the media mainstream since the 50s right there there are whole movies, you know, focused on the applications of AI for good and for bad, right? But as far as a accounting focus goes, AI really is not very yet for most firms but the idea of RPA or robotic process automation is actually more tangible and more, I think sort of are currently useful for firms. So sort of the best way to illustrate the difference between RPA and AI is to almost imagine a pyramid or a ladder. Right? And so the sort of the first step there is basic automation of processes using your current ERP systems, be it you know, Oracle, SAP, Hyperion, zero, QuickBooks, whatever you are using. That sort of baseline automation. RPA though is that extra layer right? Where it builds on that baseline automation, that baseline. So documentation and then helps firms automate either entire processes or pieces of of processes. Now a interesting point to keep in mind though with RPA is that even though we are having a conversation on the counting and on finance RPA, that idea and that process, it's actually being used in a whole host of industries, right? So HR, right? HR, every person who is hired is obviously a a individual and is hired as such. But that underlying HR process, right, the onboarding process, benefits process, all that stuff is actually pretty consistent from person. The firm is actually a consistent from person to person and firm to firm, right? So then automating those processes and then really sort of thinking of how RPA can be used at a much broader level. Be it in the hiring of people, inventory counts, get bank recs. Obviously all of those types of things really unlocks sort of the true upside of it. And also versus AI. RPA actually has software tools and firms that have been out there in the marketplace for the last 1520 years, be it UI path automation anywhere blue prism. There are a whole host of firms out there who are focused in this RPA space, have products that work and actually have a actual track record of actual client service over the last 10, 15, 20 years. So AI is sort of that ultimate end goal, right? Where all of us want to be. And so that's basically where the, you know, data is, is automated, it's processed. And then on top of that, those tools and processes that are put into place by us actually can help us analyze that information on a continuous basis. Right. But just a quick point to analyze on AI, is that AI, like blockchain is often tossed around, but it's more of an overarching term than a one focus data point? Right. So there's computational AI, there's all sorts of AI is out there. So if our conversation, probably computational is the most important, but there are all kinds of AI options out there. So unimportant point to keep in mind on top of ensuring that your underlying processes via your documentation, via automation, via RPA tools are actually ready for AI. It's important to also be able to have a conversation as to what kind of AI is actually most important for you, the firm and for your external clients. And sort of a last point here is that firms want to often sort of jump ahead right to AI, just a full blown AI project, but it's not really possible to actually go from here to AI, right? It's important to make sure that your, your processes and your controls and your data flow is actually built and then controlled in a way that is actually going to help you use the AI tools, right? I mean, because AI is a fantastic tool and there are great software programs out there, but if those underlying processes and that data aren't controlled, aren't cleaned or normalized, it's going to be awfully hard to actually get the benefit out of AI that you are going to want. So to sum up, probably the best way to envision the RPA versus AI is sort of think of it as, you know, part one is automation, part two is RPA, and then the ultimate end goal. Part three is that AI or that you have self learning type of software. But it's important to make sure that as you're having conversations, uh, both internally and externally, your processes and your controls are actually moving upward to. Announcer: (11:06)This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

FULL EPISODE TRANSCRIPTMitch: (00:03)Welcome to Count Me In, IMA's podcast about all things affecting the accounting and finance world. I am Mitch Roshong and with me, as always is my cohost Adam Larson. The topic of this week's episode is the deceptive allure of emerging technologies. Adam, can you tell us a little bit more about this?  Adam: (00:17)Sure can Mitch! A technology's an intriguing topic in today's accounting profession as the future is here, yet still constantly evolving. We hear all about new technologies there, benefits, hype curves, et cetera, but I was curious to hear about how it's actually implemented. So I reached out to Pierce Kohl's CFO of TENTE to ask him what he thinks about this trend and what he and his company are doing with emerging technologies. Pierce definitely has a great outlook on this topic. So let's take a listen.  Adam: (00:51)What kind of technologies do you utilize at your company and how do you see the impact of emerging technologies affecting the accounting profession?  Pierce: (00:59)That's a great question. You know, emerging technologies is such a great topic, mainly because it includes all those buzz words that everyone loves to throw around. Things like artificial intelligence, machine learning, big data, blockchain, and all the other ones that I'm sure but listeners are aware of. But the important thing that I want to remind listeners is not to get lost in the world of emerging technologies and forget about those existing technologies, which is why I kinda like the title of this, the topic of this podcast to be the deceptive allure of emerging technologies. You know, and I trust me, I know this is something easier said than done because I struggle with this as well as the CFO of TENTE. I not only lead the finance and accounting departments, but I'm also responsible for it, which I actually love because I'm so fascinated with technology and you know, it's probably something most likely due to my age, but I don't like things staying the same for an extended period of time, which is why I'm constantly looking into different ways of doing things, mainly by utilizing technology. But something that I see is that people, and like I said, I'm guilty of this as well, is we tend to get too hung up on this topic of emerging technologies and we forget about, like I said, the existing technologies. You know, you take a look at, you know, certain department leads, you know, they're thinking, okay, how do I utilize things like artificial intelligence, blockchain when if you take a step back, the departments that they're leading are utilizing technologies that are like 10 15 years old, which is kind of crazy to think about because of how fast we know technology changes. And I kind of look at technology the same way you would look at dog and human years where one human year is equivalent to seven dog years. Technology is not that much different. And I think it's important for people to kind of keep that in mind as they think about technology and you know, they need to keep in mind, it's important to stay up to date and relevant because if you don't, your competition might, and that might be a competitive advantage that they get on you. So don't get me wrong, I also love the buzz words. And TENTE we utilize technologies such as IBM's Cognos for our BI needs and we use it for predictive analytics. Something also we use is Microsoft's power BI, which I would highly recommend people to look into. We utilize it with our CRM software and it's become a game changer for our sales reps and sales managers. They got visibility that basically they've just, they've never had before. So a little side note there, I really recommend people look into Microsoft power BI. But moving on, when it comes to technology, the thing to keep in mind is that it does not need to be emerging to be worth implementing. You know, the cool thing about technology is that there are some very simple technologies that can be utilized that can make a, maybe not a huge significant impact, but can make people's lives easier. And in my opinion that's one of the main purposes of technology. You know, there's two main things I look for when deciding on whether or not to utilize some type of technology, one, does it make the user's lives easier or to does it break the bank? So that first one should be a kind of obvious answer. But trust me, there are things implemented that have made user's life worse. And then to, it's also an obvious one in my opinion, but that's more of the finance guy and me coming out. You know, if it's gonna cost an arm and a leg, you know, you always gotta have a return before you move forward with something. But the main point there I'm trying to make is when it comes to technology, it does not need to be emerging to be worth implementing. You know, at TENTE, we use things like Expensify for our expense tracking. We use something called Tax Jar for automated sales tax reporting. We use Trello for project management teams and communications. You know, these are all great uses of existing technologies that are simple to use and implement and can definitely make a positive impact on the department. So as you can tell, the point I'm trying to make is that you don't have to implement emerging technologies to make an impact. It can be something small that can just maybe make your life a little easier. You know, another thing we've started utilizing at TENTE is our banking's mobile application. Mainly the reason why is because we used to approve payments and transfers via physical token IDs. And what that meant was if I wasn't physically at my desk with that token ID payments could not be approved, which would cause issues because if I'm traveling or on the road and I don't have that with me, payments aren't going out. So our banking, our bankers told us that they came out with this app and basically told us that there was, that the token ID was actually contained in the app. So no matter where we were, we could get on our iPhones and basically approve ACH is and transfers right there on our phones and get all of our banking information right there on my phone so I don't have to be tied down to a desk, you know? And that was something that was very small to implement but may a nice impact and made my life much easier. So that was just another example there. Now to the second part of the question, as far as the impact that emerging technologies are going to have on the accounting profession, you know, it should be no surprise to anyone that technology has already in, is going to continue to make significant impacts on many different job functions and accounting is right there among the rest of them. It shouldn't be no secret that there are technologies out there currently that can kind of do certain accounting job functions that maybe in the past it took, it required a physical person to do, for example, at TENTE we've started utilizing a program, called Paymorang where basically we pay, send a wire or a payment to Paymorang and then they are responsible for distributing that payment they received to us, to our vendors. And so this saved us from, you know, headaches like stuffing and mailing checks, clearing checks off the bank rec. And not only that, it made the bank rec a lot simpler. There are some negative things with it. Like you kind of lose out on the float. But you know, so when cashflow is kind of an issue, maybe you might want to look into something a little different. But those are kind of things that we started to look at and utilize and the department that I lead, another thing to really keep in mind when it comes to the impact that technologies are having on the profession is, you know, businesses are going to have to be more receptive to remote work. I think we've already kind of seen that and in the example I gave with the banking application, they told me that's why they actually came out with that application was because they see the trend towards people wanting more flexibility and being able to work more for a look remotely and not being tied down to a desk. So it's important for businesses to kind of see that and kind of be thinking, okay, how do we implement technologies that not only make our lives easier, but maybe give us a competitive advantage in terms of recruiting, you know, and maybe if we can implement some kind of technologies to where people can work more remotely, that could be a recruiting advantage for us to get, you know, some higher talent employees. You know, this is actually a topic that me and my boss have discussed, um, because it's kind of becoming something new at TENTE and something that people are kind of certain to ask about more and more. And it's, it was kind of interesting because when you, when I was talking with my boss, you know, to him, flexibility when he started meant something completely different than what flexibility means today. When he started flexibility meant, Hey, if my kid has soccer practice at 3:30, can I leave, you know, an hour early and go to that? Or, Hey, I got a doctor's appointment tomorrow morning at 11, kind of come in a little later. You know, that was the flexibility. Then the flexibility now is more, tends to be more, Hey, I would like to work remotely one or two days a week. You know, that's a pretty big change and a pretty big shift in the term flexibility. So I think it's important that businesses and companies try and utilize technologies that kind of push that way in terms of, you know, being able to let their employees work remotely and so forth, especially in the accounting profession. But, and, and closing and just to kind of wrap this up overall, I just want to reiterate the point that when it comes to technology, it does not need to be emerging to be worth implementing. I think that's really important for people to remember. Don't forget about the emerging technologies, don't get me wrong, they're important and you need to be up to date. But take a step back and see if there's things within your current department that maybe you could utilize an existing technology to make your life easier. And as far as the effect on the accounting profession, the key takeaway for management accountants and accountants in general is to not dwell on the fear of your skillset, for lack of a better word, becoming irrelevant, but rather work on adopting and adapting to the new technological changes, which in the end will only make you more valuable.  Announcer: (11:52)This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Your hosts, Adam Larson and Mitch Roshong, preview IMA's upcoming podcast series, "Count Me In". Adam Larson, Senior Manager of Educational Technology Enablement, and Mitch Roshong, Senior Manager of Educational Products, team up to talk with thought leaders and transformative business professionals from the accounting and finance industry about the future of the profession. With the goal of answering the FAQs on the job and offering innovative insights into fulfilling the duties and responsibilities of today's management accountant, Adam and Mitch interview experts from the field to bring the latest perspectives on accounting and finance.https://podcast.imanet.org/https://www.imanet.org/about-ima/ima-podcasthttps://www.imanet.org/https://www.linkedin.com/in/larsona/https://www.linkedin.com/in/mitchellroshong/