Our CFO, Dan Dougherty was recently named CFO of the Year by the San Fernando Valley Business Journal. I asked him what makes today’s CFOs tick and how the position has changed since he started at Nexus 16 years ago. Here’s his answer:
The role of the CFO has evolved in modern business, perhaps more than any other executive position. Gone are the days when proper accounting principles, audit preparation, and compliance concerns were a CFO’s primary focus. The CFO is now expected to be an active participant in all aspects of the business. At Nexus, a leading systems integrator headquartered in Valencia, Calif., CFO Dan Dougherty leads many different teams, all with a single goal: to provide business value to the organization.
For example, in addition to working with the company’s Controller, Mark Pierce, to oversee the Accounting and Finance Departments, Dougherty also provides executive level oversight of the Human Resources department at Nexus. In the advanced technology industry, retention and recruiting of top talent is a unique challenge – the most qualified candidates are highly sought-after and attracting and retaining the best employees is very competitive. While Nexus does outsource some recruiting, its own internal Human Resources Department lead by Director of HR, Rebecca Sweeney, hires about ten times as many employees. An average of 20 employees per quarter are hired by the internal HR department versus an average 2 per quarter hired through outside recruiters. Why are the inside teams so much more successful? Because they take the time to fully understand the job requirements and because they can “sell” the value of working at Nexus the way only an employee can. Dougherty knows this passion for enticing the right candidate into the right role is a place where his teams can really add value to the business.
Another area Dougherty sees CFOs adding business value is in Purchasing and Procurement. Under the supervision of Heather Taylor, Director of Procurement, the Nexus purchasing team is dedicated to ensuring orders are processed accurately and timely. This means responsiveness to two separate “customer” groups; the end customer ordering the products and services, and the manufacturing partners Nexus orders from. Both groups count on Dougherty’s teams to ensure that the process functions smoothly. Nexus’ purchasing team has gained a reputation throughout the industry as the “go to” partner for orders that absolutely have to be placed that day. That often means that the teams stay late into the night getting the orders booked. This reputation has been key to helping the sales team drive 20%+ year over year growth since the inception of the business.
Business tools and reporting have always been part of the domain of the CFO, however in today’s business world it is imperative that those tools reach all aspects of the business. Dougherty works closely with Business Systems Manager, Sabrina Anderson, to provide the tools, programs, reports, and systems the business uses to track profitability and productivity throughout the organization. She has created tools like a web-based portal that tracks the real-time progress of each customer project, which Dougherty and other executives use to identify opportunities for improvement in cost estimating, project management, and engineering. The sophisticated reporting systems today’s CFOs use allow management to create better forecasts, helping guide decisions about things like capital acquisition, headcount, and even office space acquisition. With better business intelligence and forecasting, lenders gain more confidence in the company, resulting in larger credit lines and lower interest rates for capital.
As part of senior management, today’s CFO is expected to guide all of these internal business systems, while maintaining a strong awareness of overall economic trends and specific industry trends. While much of this information is available in the daily news and from employees “in the trenches”, Dougherty advises that companies should also closely follow their industry’s leaders. For Nexus, that’s a close alignment to Cisco, a leader in advanced technology products like voice, video conferencing, data center, and secure wireless networks. This close partnership allows Nexus to develop a deep expertise about specific products, allowing them to make a trusted recommendation to the customer and provide excellent service in designing, installing, and supporting the end-to-end solution.
As a mentor to coming generations of CFOs, Dougherty’s final advice is to take a holistic approach. Be passionate about the whole business, not just about accounting. Cultivate “street smarts” – immerse yourself in as many processes and departments as you can and learn more about the contributions each person and each department make to the company as a whole. Expect the role of the CFO to continue to change, and look for non-traditional ways to bring even more value to your company.