In today’s hyper-competitive global marketplace, the ability to consistently generate valuable products separates top performers from mere observers. At the heart of every growth strategy, people play a key role in crafting a company’s capacity to develop and implement disruptive ideas. Too often, however, finance executives are sidelined in conversations about innovation—or worse, they’re described as inhibitors of the creative process.
The truth is: Management accountants play an integral role in fostering a company’s culture of innovation, empowering leaders to tap their full creative capacity and directly contributing to the development of new offerings.
Many finance executives already exhibit strong delivery skills—which are crucial to successfully implementing new ideas. But as these same executives spend more time developing the key discovery skills—questioning, observing, networking, experimenting, and associating—they will be better equipped to recognize the importance of innovation in company growth. They’ll also get better at developing metrics that allow for long-term innovation, and more frequently bring their own creative solutions to the table.
Finance departments today are taken to task when they fail to mitigate risk or do not meet compliance standards. These expectations push finance executives to be viewed as the voice of caution, a skeptic, and the devil’s advocate in boardroom discussions.
This role certainly has its place; however, elements of the way finance executives view their function can be adapted to better enable and accelerate growth. These elements include gaining a better understanding of the role delivery skills play in the innovation process, improving their discovery quotient, and encouraging themselves and their organizations to take a long-term view.
Innovation can be divided into three segments—discovery, development, and delivery. Those in finance or accounting shine when it comes to four key delivery skills: analyzing, planning, detail-oriented implementing, and self-disciplined executing. With finance executives acting as the organization's gatekeepers and stewards of records and resources, it is no surprise these are the skills that are emphasized, valued, and promoted. This delivery-driven skill set is an important complement to discovery-driven organizations and teams.
The fastest way for an organization to die is to stop executing. Discovery-driven leaders need the delivery-driven skills of people who excel at execution. Savvy executives and managers remember how each of these skill sets of discovery, development, and delivery complement each other; and those in financial roles need to proactively lend their strengths as executors to the team’s success.
Five key discovery skills distinguish innovators from typical executives. These “action-oriented” discovery skills help increase the stock of building-block ideas from which innovative ideas can emerge.
- "Associating" or "associational thinking" is the most important discovery skill. Associating happens as people synthesize and organize novel inputs. Individuals with strong discovery skills are able to make connections across seemingly unrelated questions, problems, or ideas—intersections where innovative breakthroughs often take place.
- Asking provocative questions to challenge the status quo.
- Observing the world as an anthropologist would to detect new ways of doing things.
- Networking with people who are in various walks of life and who come from different viewpoints to gain radically different perspectives.
- Experimenting relentlessly to test new ideas and try out new experiences—continuously learning from the results.
It is increasingly important for finance executives, as confidants, advisers, and key decision-makers, to have the courage to innovate. By looking past short-term demands and criticisms, they give organizations the breathing room required to discover, develop, and deliver game-changing results.
Every individual has a more untapped creative capacity than he or she may realize. As finance executives internalize this truth, and work to improve these skills, they will lead more fulfilling professional lives, with valuable insights that will undoubtedly secure the welfare of their organization today and well into the future.
A full version of this article, “Cultivating Innovation,” by Hal Gregersen, is available in the Summer 2013 print issue of CGMA Magazine or at cgmamagazine.org.
Also in the Summer 2013 print edition:
- Executives at Domino’s Pizza and several reputational risk experts share the secrets to repairing inevitable reputational dents.
- Retired Coca-Cola finance executive Doug Bonthrone, CGMA, describes how to keep continuous improvement flowing.
- Ravichandran Venkataraman, CGMA, senior vice president and head of the Global Business Services division at Hewlett-Packard, offers tips on how to foster innovation.
- McCormick & Co. executive Ken Kelly, CPA, CGMA, explains how cross-functional, self-governing employee boards help the global spice company identify business process improvements.
- Bernard Marr, CEO of the Advanced Performance Institute, explains the differences between companies that merely compile data and those that thrive from it.
- Aidan Goddard, CGMA, the CFO and COO of L’Occitane en Provence’s Asia-Pacific operations, explains how his company harnesses Big Data to cut costs while improving sales and marketing strategies.
- Priscilla Mutembwa, CGMA, of Cargill Cotton Zimbabwe offers insight from an industry and economy that are defined by uncertainty.
—Jack Hagel, editorial director
CGMA Magazine is published at cgmamagazine.org in conjunction with the Chartered Global Management Accountant designation, which was created through a partnership between the AICPA and CIMA. The magazine offers news and feature articles focused on elevating and emphasizing management accounting issues.