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I disagree, if you're able to understand and do a projection, forecast, risk analysis, sunk cost analysis you can easily get finance on your side. The issue is

I disagree, if you're able to understand and do a projection, forecast, risk analysis, sunk cost analysis you can easily get finance on your side. The issue is that IT/tech does not know business key words or excel spreadsheets, and finance does not know tech. Nowadays it's getting blurred with data scientsts and excel crunchers that can do a mean macro (and know more than Vlookup!) Finance people love automation. Finance people love excel. Finance people understand sunk cost fallacy. Finance people understand change. Finance people need help to embrace change, to guide decisions and make sure it's the right "tech" for the company. Many times the right tech is O365/Sharepoint/Flow automation, or nintex. Yeah, but it is not souless, it guides the entire company, it ist he company pursestrings. Get them on your side, understand how to read a P/L sheet, what FPA does and you'll not only earn respect, you'll have your name said at all the exec/leaderships meetings and you'll be loved. That's what I do in companies (consulting, self run) and w/o a good background in finance, and tech I wouldn't be where I am today (major in stats, tech was hobby, stats/math is everything etc.) So I fully disagree 100%. You had it so close with SAAS and capex vs opex, but you missed it. But yes it does move expenses around and opex is easier to navigage then a full sunk cost capex.

erdos4d 5y ago
I read this comment and I feel dumber.
clncy 5y ago
Spot in with the automation! Too often people rush to build a new system without thinking first about the systems and processes that already exist.
planet-and-halo 5y ago
This is something I've been interested in for a while. Do you think it's worth getting an MBA or some other financial degree if you're already in the workforce, or can you learn enough on the fly?
- andrewlgood 5y ago
  I do not recommend getting an MBA or some other financial degree. Rootsudo's response is excellent. There are actually very few financial concepts involved in these types of analyses (e.g. discounted cash flows, IRR, and NPV). IMHO, the best thing you can do is work with someone in your FP&A (Financial Planning & Analysis) group discuss your investment idea and why you think it is a good idea. If they are a decent analyst, they will help build a model to describe financially your investment opportunity. This is what they live for.
  - planet-and-halo 5y ago
    Thanks, appreciate the suggestion.
    - shnock 5y ago
      I would agree strongly with the comment to which you are replying (the parent? This is my first time commenting :). The primary benefits of an MBA are not the knowledge learned and said knowledge is shallow enough that it is feasible to gain it without the degree.
    - conductr 5y ago
      FP&A agrees. For what it’s worth, I never did MBA. I did finance undergrad and it just felt duplicative to do it again. It can be limiting to an extent but it’s also meritocratic once you’re in. It’s a screening question for many employers at the manager/director level and up but if you haven’t built a strong enough network by then than something is off anyways. (Make friends with recruiters.)
- haser_au 5y ago
  I asked the same question a few years ago (tech background, needed to uplift my business knowledge/lingo). The response was "you should find a way to obtain the knowledge of an MBA, without having to do one". As a result of searching a few years back, I ended up buying a copy of "The Personal MBA" and reading it through. This comes with the list of 99 business books, listed here; https://personalmba.com/best-business-books/ https://personalmba.com/best-business-books/ * I have no affiliation with the site, author or book. I'm just speaking from my personal experience and the benefit of business knowledge this gave me.
mschuster91 5y ago
> I disagree, if you're able to understand and do a projection, forecast, risk analysis, sunk cost analysis you can easily get finance on your side. That doesn't help against clueless execs who live 20 years or more in the past. Japan's cybersecurity minister literally admitted to never ever having used a computer in his life (https://www.theguardian.com/world/2018/nov/15/japan-cyber-security-ministernever-used-computer-yoshitaka-sakurada https://www.theguardian.com/world/2018/nov/15/japan-cyber-se...). Even if you show them that your IT modernization has the potential to save the company millions of dollars a year, they will decline your proposal because "the current system works/no need to upgrade and risk issues". The literal only way to get banking C-level execs to modernize their 70s era mainframe stacks is regulatory action. Only with the threat of massive government-levied fines or closure of business, they will go ahead with change.
clairity 5y ago
> “it is not souless, it guides the entire company…” once, as a pre-mba product manager at a mid-sized company, i presented a detailed financial projection (using monte carlo on the assumptions/inputs) for a project i was championing that went over the head of the controller (and acting cfo at the time). boy was i disillusioned after that. finance should never be thought of as guiding a company. that’s giving them too much credit and (misguided) influence. rather, it should provide analyses to the executive team to use to make executive decisions, much like the congressional budget office does for congress. it’s one of many inputs needed to make executive decisions.
- nanis 5y ago
  > i presented a detailed financial projection (using monte carlo on the assumptions/inputs) .. went over the head of the controller (and acting cfo at the time). boy was i disillusioned after that. In my experience, it is hard to find people in the finance department who understand there are other distributions than Normal. E.g., the time I had to spend trying to convince finance people that the product of two Normals is not necessarily Normal. Or, percentiles of the sum of two Normals do not correspond to the sum of the percentiles etc. Yet, they do end up guiding the company because money drives everything.
  - webmaven 5y ago
    > Or, percentiles of the sum of two Normals do not correspond to the sum of the percentiles etc. I once had to spend a day convincing a CFO that consecutive months of ~X% increases of MRR wasn't the same as ((($MONTHS * X) +1) * MRR) eg. two months of 10% = +20% increase, 5 months = +50%, etc. ... which is how his spreadsheet was calculating revenue projections. How does a CFO not understand compound interest?
- tibbetts 5y ago
  Finance is like the engineering department in Star Trek. They provide critical resources, and are limited in what they can do by the laws of physics, but they still have to respond to constant demands from executives to somehow make it work anyway. That means they aren’t steering the ship, but they are going to interpret guidance from the captain about priorities in ways that make sense to them.
jldugger 5y ago
> I disagree, if you're able to understand and do a projection, forecast, risk analysis, sunk cost analysis you can easily get finance on your side. The mystery to me is why IT departments run by a CFO are notoriously bad at IT. It seems like Finance will take cutting costs over increased revenue every day of the week; I don't know if they just hate taking on risk, or are just hoping someone will convince the board to hire a CIO and relieve them of the duties, but the end result is rarely pretty.
- webmaven 5y ago
  > The mystery to me is why IT departments run by a CFO are notoriously bad at IT. It seems like Finance will take cutting costs over increased revenue every day of the week; I don't know if they just hate taking on risk, or are just hoping someone will convince the board to hire a CIO and relieve them of the duties, but the end result is rarely pretty. In my experience it is simply a reflexive dismissal of externalities. If you can get them to model the small but real (though fuzzy, so with error bars) costs (eg. higher employee dissatisfaction = increased turnover, lower productivity = increased time to market, etc.) of each cut it works out better: Sometimes the cumulative price does it, sometimes the cumulative uncertainty.

erdos4d 5y ago

I read this comment and I feel dumber.

clncy 5y ago

Spot in with the automation! Too often people rush to build a new system without thinking first about the systems and processes that already exist.

planet-and-halo 5y ago

This is something I've been interested in for a while. Do you think it's worth getting an MBA or some other financial degree if you're already in the workforce, or can you learn enough on the fly?

andrewlgood 5y ago
I do not recommend getting an MBA or some other financial degree. Rootsudo's response is excellent. There are actually very few financial concepts involved in these types of analyses (e.g. discounted cash flows, IRR, and NPV). IMHO, the best thing you can do is work with someone in your FP&A (Financial Planning & Analysis) group discuss your investment idea and why you think it is a good idea. If they are a decent analyst, they will help build a model to describe financially your investment opportunity. This is what they live for.
- planet-and-halo 5y ago
  Thanks, appreciate the suggestion.
  - shnock 5y ago
    I would agree strongly with the comment to which you are replying (the parent? This is my first time commenting :). The primary benefits of an MBA are not the knowledge learned and said knowledge is shallow enough that it is feasible to gain it without the degree.
  - conductr 5y ago
    FP&A agrees. For what it’s worth, I never did MBA. I did finance undergrad and it just felt duplicative to do it again. It can be limiting to an extent but it’s also meritocratic once you’re in. It’s a screening question for many employers at the manager/director level and up but if you haven’t built a strong enough network by then than something is off anyways. (Make friends with recruiters.)
haser_au 5y ago
I asked the same question a few years ago (tech background, needed to uplift my business knowledge/lingo). The response was "you should find a way to obtain the knowledge of an MBA, without having to do one". As a result of searching a few years back, I ended up buying a copy of "The Personal MBA" and reading it through. This comes with the list of 99 business books, listed here; https://personalmba.com/best-business-books/ https://personalmba.com/best-business-books/ * I have no affiliation with the site, author or book. I'm just speaking from my personal experience and the benefit of business knowledge this gave me.

mschuster91 5y ago

> I disagree, if you're able to understand and do a projection, forecast, risk analysis, sunk cost analysis you can easily get finance on your side. That doesn't help against clueless execs who live 20 years or more in the past. Japan's cybersecurity minister literally admitted to never ever having used a computer in his life (https://www.theguardian.com/world/2018/nov/15/japan-cyber-security-ministernever-used-computer-yoshitaka-sakurada https://www.theguardian.com/world/2018/nov/15/japan-cyber-se...). Even if you show them that your IT modernization has the potential to save the company millions of dollars a year, they will decline your proposal because "the current system works/no need to upgrade and risk issues". The literal only way to get banking C-level execs to modernize their 70s era mainframe stacks is regulatory action. Only with the threat of massive government-levied fines or closure of business, they will go ahead with change.

clairity 5y ago

> “it is not souless, it guides the entire company…” once, as a pre-mba product manager at a mid-sized company, i presented a detailed financial projection (using monte carlo on the assumptions/inputs) for a project i was championing that went over the head of the controller (and acting cfo at the time). boy was i disillusioned after that. finance should never be thought of as guiding a company. that’s giving them too much credit and (misguided) influence. rather, it should provide analyses to the executive team to use to make executive decisions, much like the congressional budget office does for congress. it’s one of many inputs needed to make executive decisions.

nanis 5y ago
> i presented a detailed financial projection (using monte carlo on the assumptions/inputs) .. went over the head of the controller (and acting cfo at the time). boy was i disillusioned after that. In my experience, it is hard to find people in the finance department who understand there are other distributions than Normal. E.g., the time I had to spend trying to convince finance people that the product of two Normals is not necessarily Normal. Or, percentiles of the sum of two Normals do not correspond to the sum of the percentiles etc. Yet, they do end up guiding the company because money drives everything.
- webmaven 5y ago
  > Or, percentiles of the sum of two Normals do not correspond to the sum of the percentiles etc. I once had to spend a day convincing a CFO that consecutive months of ~X% increases of MRR wasn't the same as ((($MONTHS * X) +1) * MRR) eg. two months of 10% = +20% increase, 5 months = +50%, etc. ... which is how his spreadsheet was calculating revenue projections. How does a CFO not understand compound interest?
tibbetts 5y ago
Finance is like the engineering department in Star Trek. They provide critical resources, and are limited in what they can do by the laws of physics, but they still have to respond to constant demands from executives to somehow make it work anyway. That means they aren’t steering the ship, but they are going to interpret guidance from the captain about priorities in ways that make sense to them.

jldugger 5y ago

> I disagree, if you're able to understand and do a projection, forecast, risk analysis, sunk cost analysis you can easily get finance on your side. The mystery to me is why IT departments run by a CFO are notoriously bad at IT. It seems like Finance will take cutting costs over increased revenue every day of the week; I don't know if they just hate taking on risk, or are just hoping someone will convince the board to hire a CIO and relieve them of the duties, but the end result is rarely pretty.

webmaven 5y ago
> The mystery to me is why IT departments run by a CFO are notoriously bad at IT. It seems like Finance will take cutting costs over increased revenue every day of the week; I don't know if they just hate taking on risk, or are just hoping someone will convince the board to hire a CIO and relieve them of the duties, but the end result is rarely pretty. In my experience it is simply a reflexive dismissal of externalities. If you can get them to model the small but real (though fuzzy, so with error bars) costs (eg. higher employee dissatisfaction = increased turnover, lower productivity = increased time to market, etc.) of each cut it works out better: Sometimes the cumulative price does it, sometimes the cumulative uncertainty.