What Do CFOs Wish Compensation Professionals Knew?
As a compensation consulting expert, I understand communication is critical when discussing compensation with your CEO. That's why I'm here to provide you with the insights you need to communicate effectively with your executive team. It's no secret that most companies spend between 10% and 30% of all revenue on employee compensation, which is where CFOs come in. They're the numbers people, and they specialize in money. So, what do they really wish you knew?
Recent "Top 10 lists" discuss the concerns of CFOs, and nearly every list includes the following:
Dealing with the US economic recovery
Identifying the best growth strategies
Avoiding execution errors
Improving staff without going over budget
Identifying and growing talent
Retention and motivation of top talent
Improving their department's ability to be a business partner
Sound familiar? It should be because these are the same concerns that Directors of Human Resources and Compensation have addressed for years. To make it easier for finance to support your ideas while achieving their own goals, here's a cheat sheet from the CFO:
Use real numbers and avoid vague estimates or guesses.
Don't oversell on huge gains. CFOs have a specific projected growth rate to achieve.
Present charts and graphs that make sense and are informative.
Back up your charts and summaries with complete data sets.
Understand the impact of your ideas on the finances of the company.
Model expenses for awards and payouts using assumptions applicable to your company.
Be ready to discuss both upside and downside risks in today's uncertain market.
Remember that many of the CFO's goals are the same as yours. Take the time to understand their specific concerns.
When working with a CFO, always argue your point from the other side of the table, and be ready to compromise. A great negotiation requires compromise from all involved parties.
CFOs are often the easiest people to work with on compensation projects. They understand numbers, talk about money every day, and must directly link every budget decision to the growth and success of the company. They're also like us in that they enjoy being compensated! Approach your needs and issues from their perspective, and you'll find a like-minded business partner eager to help you succeed.
At FutureSense, we specialize in compensation, HR, and OD solutions. Contact us today to learn more about how we can help you achieve your compensation goals.
About FutureSense
FutureSense is a management consulting firm that provides integrated solutions to build and sustain human capital capacity. The firm can work with you by offering support and guidance to manage your workforce. To learn more about FutureSense, please visit FutureSense.com.