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Full disclosure, I am a CFO and have spent much of my career in Finance. I have never worked in a place where I or anyone else there thought Finance is "any mo

Full disclosure, I am a CFO and have spent much of my career in Finance. I have never worked in a place where I or anyone else there thought Finance is "any more intelligent than the other players in the company." This article is disappointing in that it gives the impression that one department makes or breaks a company. To be clear, there are poorly run Finance organizations in the world and they can make the culture at a company less than fun. There are also poorly run IT organizations (to include product development) that can ruin a company culture. Even ones run by a CTO that reports to the CEO. I have also never seen a company where the CFO does not ultimately report to the CEO. I have seen companies where the CFO reports to a Chief Administrative Officer (CAO) who reports to the CEO. I completely agree that the CEO ultimately sets the vision of the company and hires the executive team to deliver on it. That being said, a CEO is not Superman/Superwoman. They need a team surrounding them to deliver what you expect. What the article could have emphasized is how software engineers can work with the Finance team to better describe investment opportunities like hiring production engineers to increase the productivity of application engineers. Yes, investment opportunities ultimately need to generate more cash returns than the investment. This may require serious thought around the benefits from increased software quality, faster cycle times, increased cybersecurity etc. Importantly the analyses do not have to be decimal level precise. But, if you cannot describe how your investment opportunity ultimately creates more cash flow than the investment required, your opportunity will likely not be funded.

Fordec 5y ago
I am at a point where I don't think there should be finance departments in tech companies. I also believe there shouldn't be siloed data departments for the record either. There should be teams, build around a cohesive product goal that solves customer needs. There should be someone who understands the money side of things embedded in that department doing analyses and making recommendations to the product manager, not direct to a CFO. Maybe half their job is regular market analysis work too if the role isn't that big. Those product managers should then have in their day to day functions a requirement to get that info to a CFO's hands (who is really just the executive teams internal finance person) to make their case for their product.
- andrewlgood 5y ago
  For clarity, when you refer to finance, I think you mean Financial Planning & Analysis (FP&A). I think you would agree that centralized Tax, Treasury, and Accounting functions are ok and should probably report to the CFO. With respect to FP&A, I have seen several firms that simply embed them within a product line or business unit. They need to submit forecasts to a central group, but their primary mission is to support the product or business line.
  - Fordec 5y ago
    Yeah basically but I've yet to work on a team (that I didn't build myself) where the FP&A is separated from Accounting/Tax and not a direct report to the CFO or CEO if the company is pre-CFO. Sometimes even seen Accounting/Tax as a direct report under HR with zero product connection. So I just hadn't come across that term before.
tpuser 5y ago
The finance business area at the last large company I worked for was borderline ridiculous. The division I was employed at ran a billion in revenue through Excel sheets scattered across network drives. FSS had a nightmare of a week at the end of every quarter. I was given a promotion and a shift from engineering to business analysis with the goal of creating a model to predict workforce requirements for ongoing business and new contracts. After a few months of learning the ropes and the history of similar attempts, it became clear that the company already held a license for software suitable (perfect) for this goal and the finance area was already slowly working towards ditching the excel mess in favor of the sane solution. By "slowly" I mean that they had been inching towards using the right tool for years, finding any and every excuse to abandon course. The corporate app dev unit explained to me that they were wary of working with the finance area of my division as finance had repeatedly gone 90% of the way to an improved tool only to bail out at the last minute, wasting time and money and leaving corp app managers the task of explaining why things fell through to their bosses. The best (worst) excuse given by finance during my attempt to sort things out was after we were acquired by an even larger contractor. "We're not sure if <company> uses <software>, so we're going to need to put a complete halt on the shift." They weren't sure? It took me less than a minute to go to the acquiring corp's job req page and see that they were hiring admins/devs for the software in question. Ridiculous. Finance leadership could have made a single call to ask a single question, but rather than stepping out of the comfort zone they decided to scuttle a project which was all but guaranteed to improve their lives and the organization as a whole. I'm close to 50/50 on whether the finance unit was doing something dishonest and wished to retain the control provided by using an opaque/incomprehensible system or if they were merely too afraid of any sort of change by virtue of their bean counting nature. Either way, they're probably still actively harming the company.
- andrewlgood 5y ago
  It is sad how much of Finance (primarily FP&A) gets run through Excel. There are many products out there today that can make the job easier, but as you point out, not all organizations are quick to embrace them. My personal hope is financial analysts get more tech savvy over time. SQL should be a year one skill with Python/R soon after. These should complement spreadsheets which would still have an important role in ad hoc analyses. Combine this increased tech savvy with an understanding of a visualization tool such as Tableau/Power BI and I think financial analysts could be significantly more productive than they are today. There would also be far fewer spreadsheets lying around on the network drives. It is amazing how many of those spreadsheets are simply the same model with the next month's data. Better use of databases would allow one spreadsheet with a database to store the changing inputs.

Fordec 5y ago

I am at a point where I don't think there should be finance departments in tech companies. I also believe there shouldn't be siloed data departments for the record either. There should be teams, build around a cohesive product goal that solves customer needs. There should be someone who understands the money side of things embedded in that department doing analyses and making recommendations to the product manager, not direct to a CFO. Maybe half their job is regular market analysis work too if the role isn't that big. Those product managers should then have in their day to day functions a requirement to get that info to a CFO's hands (who is really just the executive teams internal finance person) to make their case for their product.

andrewlgood 5y ago
For clarity, when you refer to finance, I think you mean Financial Planning & Analysis (FP&A). I think you would agree that centralized Tax, Treasury, and Accounting functions are ok and should probably report to the CFO. With respect to FP&A, I have seen several firms that simply embed them within a product line or business unit. They need to submit forecasts to a central group, but their primary mission is to support the product or business line.
- Fordec 5y ago
  Yeah basically but I've yet to work on a team (that I didn't build myself) where the FP&A is separated from Accounting/Tax and not a direct report to the CFO or CEO if the company is pre-CFO. Sometimes even seen Accounting/Tax as a direct report under HR with zero product connection. So I just hadn't come across that term before.

tpuser 5y ago

The finance business area at the last large company I worked for was borderline ridiculous. The division I was employed at ran a billion in revenue through Excel sheets scattered across network drives. FSS had a nightmare of a week at the end of every quarter. I was given a promotion and a shift from engineering to business analysis with the goal of creating a model to predict workforce requirements for ongoing business and new contracts. After a few months of learning the ropes and the history of similar attempts, it became clear that the company already held a license for software suitable (perfect) for this goal and the finance area was already slowly working towards ditching the excel mess in favor of the sane solution. By "slowly" I mean that they had been inching towards using the right tool for years, finding any and every excuse to abandon course. The corporate app dev unit explained to me that they were wary of working with the finance area of my division as finance had repeatedly gone 90% of the way to an improved tool only to bail out at the last minute, wasting time and money and leaving corp app managers the task of explaining why things fell through to their bosses. The best (worst) excuse given by finance during my attempt to sort things out was after we were acquired by an even larger contractor. "We're not sure if <company> uses <software>, so we're going to need to put a complete halt on the shift." They weren't sure? It took me less than a minute to go to the acquiring corp's job req page and see that they were hiring admins/devs for the software in question. Ridiculous. Finance leadership could have made a single call to ask a single question, but rather than stepping out of the comfort zone they decided to scuttle a project which was all but guaranteed to improve their lives and the organization as a whole. I'm close to 50/50 on whether the finance unit was doing something dishonest and wished to retain the control provided by using an opaque/incomprehensible system or if they were merely too afraid of any sort of change by virtue of their bean counting nature. Either way, they're probably still actively harming the company.

andrewlgood 5y ago
It is sad how much of Finance (primarily FP&A) gets run through Excel. There are many products out there today that can make the job easier, but as you point out, not all organizations are quick to embrace them. My personal hope is financial analysts get more tech savvy over time. SQL should be a year one skill with Python/R soon after. These should complement spreadsheets which would still have an important role in ad hoc analyses. Combine this increased tech savvy with an understanding of a visualization tool such as Tableau/Power BI and I think financial analysts could be significantly more productive than they are today. There would also be far fewer spreadsheets lying around on the network drives. It is amazing how many of those spreadsheets are simply the same model with the next month's data. Better use of databases would allow one spreadsheet with a database to store the changing inputs.