Is your forecasting mindset killing CFO innovation – almost certainly!

In an office somewhere in the world…

Data Scientist: Yo accountant dude! Why do you never forecast your miscellaneous revenue line?

Accountant: It’s miscellaneous, you can’t forecast that line.

DS: But dude, it’s 1% of your total revenue, that’s gotta impact the business and your forecast sensitivity, right?

AC: That line has no owner, you can’t forecast that line.

DS: I got exciting news dude, I can predict this line for you and be 75% accurate. That’s gotta be better than putting in a big fat zero? <holds up hand for a high five>

AC: <ignores high five hand> I deal in facts.  No owner, no possible action, no number… you can’t forecast that line.

DS: YES WE CAN. <In the style of Barack Obama>

AC: Can’t.

DS: Can.

AC: <switches to spreadsheet mindfulness mode aka cold hard silence> …

Is your mindset getting in the way of a better future?

Firstly, apologies for the language as all data scientists are Californian born skateboarders in my head today.  I know this not to be true, but it keeps it interesting on a cold December Day.

Secondly, the above conversation is NOT fiction, it is based on a conversation I had with one of my extended finance team not so long ago and it highlights the challenge on both sides of the innovation user/enabler journey.

Mindset!

In this case, I would argue no one is right or wrong, but what has happened due to a clash of mindsets is a potential idea, potentially good idea, possibly great idea has been lost.

This may be because of a closed mindset, this may be because of how it was communicated (help people to unfreeze their minds before going for a change), it may be just a bad day in the office for a new idea to be bantered around the office.

But nevertheless it has been lost and we all need to learn to embrace these innovation debates and try not to dismiss them out of hand as our future depends on them.

But does my future really depend on them, why should you care?  Yes, because your business needs support in two fundamental areas 1. Performance Management 2. Growth Strategy and growth comes from innovation aka random ideas from the quiet guy in your team…

If Innovation is a driver for Growth, how are you enabling it?

The World Economic Forum defines Innovation as, “the successful commercialization of novel ideas, including products, services, processes and business models and is a critical
component of growth.”

And we all need to enable the business to work on these ideas and our own teams to innovate, as “across Europe, the importance of innovation as a driver of growth and competitiveness has and will continue to increase, thanks to the slow rate of population growth in the region, diminishing returns on additional capital investment and increasing competition from other regions.”

A method to the madness

  • How do you encourage new ideas and innovative conversations in your teams?
  • How do you capture, prioritise, invest in good ideas?
  • How do you exploit new skills and tech that enable you to add more value to your business?
  • So how do we change this automatic thinking and open our creative minds?

It’s not going to be easy but there is a simple approach to opening up this innovation channel which may be easier than you think and without too much time being consumed… it’s called collaborative innovation.

But this article is about mindset, so what do you think of the above dialogue between the accountant and data scientist (which could be the accountant of the future)?

How would you have responded?

 

Source: WEF

We want to hear from you, comment below:

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.