Finance flash: the TOP-10 articles of week 6, 2017


Do you want to keep up to date with the latest developments in finance, but you are short of time? Don’t worry. CFO South Africa weekly collects 10 of the most important articles from international media for your convenience.

1. How to Reduce Investment Decision Complexity
Far too many companies have bureaucratic investment procedures that evolve over time into a complex, cumbersome, conflicting, and confusing approval process. Whether it's for the approval of a capital expenditure, acquisition, research and development program, or marketing investment, there are often too many different analyses, metrics, and go/no-go signals, and they often pull in different directions. Should an executive approve an investment that displays an internal rate of return (IRR), net present value (NPV), average pretax profit margin, and average net income margin that all surpass approval hurdles?

2. Expert View: How To Implement A Data-Driven Culture
We are now deep into the big data revolution, and the majority of organizations have at least recognized that they need data in order to become intelligent. For some, this means buying the next flashy software someone tries to flog them, hiring a data scientist, and leaving the two to get on with it. Put your feet up, fire up the fondue set, and wait for the insights to come pouring in.

3. Emotional Intelligence Has 12 Elements. Which Do You Need to Work On?
Esther is a well-liked manager of a small team. Kind and respectful, she is sensitive to the needs of others. She is a problem solver; she tends to see setbacks as opportunities. She's always engaged and is a source of calm to her colleagues. Her manager feels lucky to have such an easy direct report to work with and often compliments Esther on her high levels of emotional intelligence, or EI. It's strange, though — even with her positive outlook, Esther is starting to feel stuck in her career. She just hasn't been able to demonstrate the kind of performance her company is looking for. So much for emotional intelligence, she's starting to think.

4. 'Trump Bump' Buoys CFO Optimism
With the U.S. presidential election fading in the rearview mirror, the country's CFOs are feeling upbeat about the economic road ahead. The latest Duke University/CFO Global Business Outlook survey, which drew responses from nearly 1,000 senior finance executives, found U.S. finance chiefs harboring high expectations for the regulatory and tax reform touted by President Donald Trump during his campaign. At the same time, many CFOs say that their companies will not take specific actions until the new administration's plans come into sharper focus.

5. 5 Reasons Most Leaders Are Not Qualified To Lead
I was selected for a leadership fast-track program at my first job after college. Entry to the program, similar to many corporate academy programs, was based on performance - meaning sales. But I expected the program to have different measurements for promotion to leadership positions. It didn't. I'll never forget my confusion the first time I saw someone from the program that most of us would have never wanted to work for - promoted to district manager. I asked my district manager why. He told me that person had sold the most product in the last year. Just because he sold the most he was now leading. That did not make sense to me. It still doesn't.

6. Master of All Metrics
In the quaint days of old, managing a business entailed studying last quarter's revenues and expenses, taking the pulse of market demand, and conjecturing a forecast with fingers crossed. Do this today and you'd be laughed out of the boardroom. Companies now plot their future on more than just financial metrics. To steer the organization forward, they rely on an assortment of nonfinancial performance indicators like customer satisfaction, employee engagement, brand loyalty, market share, and pipeline throughput.

7. Why CFOs need a bigger role in business transformations
When managers decide that a step change in performance is desirable and achievable, they'll often undertake a business transformation. Such transformations are large-scale efforts that run the full span of a company, challenging the fundamentals of every organizational layer. That includes the most basic processes in everything from R&D, purchasing, and production, to sales, marketing, and HR. And the effect on earnings can be substantial—as much as 25 percent or more.

8. 8 Ways to Master the Art of Communication
The better you become at using these tools, the better you'll be at communicating. "The art of communication"— I like that phrase. Because communicating is an art. When we're attempting to get our message out to others, it's as though we start with a giant blank canvas and we then begin to paint a picture, any picture we desire. Now, most people assume that when painting a picture, they have only a few basic brushes at their disposal. But the advanced artist knows there are many tools available to create their masterpiece, and they use each to their advantage.

9. The Corporatization of Cyber Crime
"It's beautiful, it's elegant, it's convincing," Markus Jakobsson gushes, describing the fake email used to hack into the personal Gmail account of Hillary Clinton's presidential campaign chairman. Sent on March 19, 2016, to the chairman, John Podesta, the email landed in the spam folder of his account. That should have signaled "heightened danger" to the recipient, says Jakobsson, chief scientist at Agari, a Silicon Valley computer security firm that works with Google on email authentication. Spam implies a clear message, he adds: "Don't touch!"

10. Better Data, Better Decisions
Finance chiefs are responsible for minimizing the risks that their organizations face in all facets of business—from supply chain operations and fixed-asset investment to payment processing and cybersecurity. While analytics has played a greater role in risk reduction over the past decade, many organizations acknowledge that they still need to step up their efforts to leverage data within their risk management programs. That was one of the insights culled from a recent survey on the evolving role of data and analytics in mitigating risk, conducted by CFO Research in collaboration with PwC.

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