5 Ways to Befriend Your CFO

Posted on by David T Scott

Previously, I spoke about aligning yourself with the CIO. That worked, didn’t it? Well, you can thank me later (for the record, I’m a sucker for fruit baskets…).

The road to CMO stardom doesn’t end at the CIO’s office, though. You should consider making another stop a few doors down (or boxes across on the organization’s flowchart) to talk to someone else who can help in making the journey a smooth one. That’s right. It’s time to make another new friend—the CFO.

So, why should the lovable, well-liked CMO pair up with the by the books, by the numbers, budget buzz-killing CFO? While it may seem like an unlikely duo, the CMO-CFO pairing could be a team for the ages…the Turner and Hooch or C-3PO and R2-D2 of the 21st century business world. Now, there’s a buddy movie I’d pay to see.

But seriously, why the CFO?  A recent study by Active International (fielded by Market Measurement, an independent market research firm) shows 77% of CMOs and 76% of CFOs indicate that the alignment between the two departments is highly important for business success.  And a Marketing 2020 survey shows that where the CMO’s department works closely with finance, more than 40% outperformed expectations, showing that the CMO-CFO pairing is crucial.

There are a lot of intricacies to having a relationship with the CFO. To start, the CFO not only holds the purse strings but also determines success or failure for any of your marketing efforts. In that regard, s/he’s judge, jury, and executioner. It’s paramount to remember that the CFO is a friend not the enemy – working for the greater good of the company just like you, but from a different perspective.

And lets face it; our relationship with money is complicated. The CMO role is unique in that it requires both personnel and budget to execute their office whereas most other departments only require one or the other. But that’s also the beauty of our job. Let’s get real. What other job exists where you get to spend money? I mean, millions of dollars? Mark Zuckerberg’s Personal shopper, maybe, U.S. Senator, House Representative…?

Since the CFO controls the budget, they have a lot of sway in the executive boardroom and especially with the CEO. So, getting them to understand your needs and objectives can go a long way in getting the tools (and dollars) you need to be successful. In fact, some would argue that it’s the most important part of our job.

“Successful marketing is as much about disciplined budget management as it is about effective communications and customer engagement campaigns,” says Jane Rodmyre Payfer, CMO of Ergotron, “Establishing trust with the CFO, building a relationship with him/her, will mitigate, if not eliminate the commonly held belief that marketing is the black hole of discretionary spending for the company. “

So, to help you get the relationship started, here are five ways to befriend your CFO:

1. Take a “Finance For Non-Financial Managers” class. You wouldn’t go to Japan (or any non English speaking country) without learning some basic words and phrases, would you?  It only makes sense then to learn the finance language before walking into the finance office. Being able to use the CFOs language in discussions with her is key. At the very least it shows you are attempting to understand the foreign territory that you are in. And isn’t that what anyone really wants? Don’t worry, you don’t have to be a finance wizard or even love math. These classes do a great job of “dumbing” things down for us CMOs so we learn just enough to be dangerous. Before you know it, you’ll know the difference between amortization and capitalization.

2. Talk financial impact when discussing program initiatives. Gone are the days when you can ask for “a couple of million dollars” without promise of financial return. These days you need to know exactly how much you’re spending and what impact it will have on topline revenue. Make sure you understand the financial tradeoffs between your programs and others’ and know exactly why you recommend this course of action. The better you know these details, the more confidently you can argue your case.

“It is essential that you understand the tradeoffs between headcount allocated dollars and “spend”, and understands the CFO’s metrics and KPI’s for the organization,” says Payfer. “Making sure you’re aligned with the CFO’s thinking ensures you can maximize each resource dollar.”

3. Be flexible with your budget. This is extremely important when it comes to public companies. Marketing is the easiest place to add and remove budget when it comes time for the quarterly earning call. Be open to maintaining flexibility as it’s the best way to win the CFOs favor. I usually try to keep as much as 25% of my budget flexible, meaning you’ll have to change your planning strategy a bit. Trust me, it will be worth it. This way, if the CFO needs the budget to hit the quarterly number, then she can have it. And the next time there’s a surplus, she’s likely to come with an offering.

4. Know how to account for your expenses, understand the general ledger. Let’s say you’ve just spent $100,000. Does this money hit this month’s budget or is it spread across the next twelve months? Is the expense considered a cost of goods sold (COG) or is it below the gross margin line?

The answers to these questions have a significant impact on how much money you can ask for and how receptive the CFO will be. Chances are, you have a controller or bookkeeper assigned to your department. Befriend them, too. One of my controllers had a love for fine bourbons. He was an expensive friend, but worth it. This person will be more than happy to teach you the ins and outs of the general ledger. In the end, it will make his job much easier, too. I’ve stretched my budget by thousands and even millions of dollars by understanding the nuances of this process. You can, too, and your CFO will appreciate you more for this.

5. Save money when you can. Your new website project is under budget—what do you do with the excess cash? Simple. Offer it back to the CFO.

I know this sounds crazy. But bear with me.

There’s a fear that if you give the budget back, you won’t get it again. First, that’s not necessarily true. And, second, this is about proving that you’re a team player and fiscally responsible—not about establishing fiefdom. As mentioned before, the CFO is responsible for balancing the budget between multiple departments. Any flexibility in your department could help him do his job. By expressing your interest and appreciation for the big picture, you will quickly earn the CFO’s trust.

“When that happens, and the CFO is as solidly bought into marketing initiatives as much as the CEO and Board are,” says Payfer, “you can provide a powerful united front on all internal and external communication.”

I’m not going to lie; this is a long, hard road. But trust me, it will pay dividends.

“Today’s successful marketing leader will have the capacity to align with the financial objectives of the organization for the long haul, delivering results and ensuring there are no surprises for the financial team,” Payfer says. “And, as a side advantage, aligning with the CFO and CEO ensures that the CEO can’t play you against one another—something I’ve sadly seen happen too many times.”

Following these five simple steps have the potential to make your job and life a lot easier…some may even find Nirvana awaiting them at the end of the journey.

That’s about all I have to say on this topic, but tell me what you think? Are there any strategies I forgot or ones you disagree with? Let me know.

David T. Scott has served as CMO and head of marketing for startups, Fortune 500 companies and billion-dollar organizations, including GE, AT & T Wireless, PeopleSoft, Foresee, and Intermec. He is the author of The New Rules Of Lead Generation.


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