Ep. 122: Arno Wakfer - Training and Upskilling for Enhanced Business Performance

May 10, 2021

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Contact Arno Wakfer: https://www.linkedin.com/in/arnowakfer/

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FULL EPISODE TRANSCRIPT
Mitch: (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 bus...