Leaders of Modern Finance Ep. 11 – Five Gold Standards, Hosted by Jack McCullough ft. Peter Taylor

On this episode of the Leaders of Modern Finance podcast, Jack McCullough of The CFO Leadership Council welcomes Peter Taylor, Corporate Controller at Purple Innovation. Purple is a maker of direct-to-consumer mattresses, bedding, bases, seat cushions, dog beds, and more.

CFO Leadership Council

After a full career as CFO at 26 different companies, Jack founded the CFO Leadership Council in 2006 with a mission to empower CFOs. The council currently consists of around 2,000 members spread across North America. 

The CFOLC empowers members through two channels: professional development programs and networking opportunities. Members use the peer network to build relationships and learn from one another. 

Jack hasn’t been a CFO in ten years, but in his role as president of the CFOLC, he has had a front-row view of the dramatic evolution of financial leadership. He says that during Covid, that evolution became a revolution, and he’s been using the phrase, “Controllers are the new CFOs” a lot these days. The CFO role has become much more cross-functional, which wouldn’t be possible without a strong team of controllers.

The Controller Role

Peter has worn the controller hat for more than ten years, and he has seen the skills and tools necessary to be successful in that role change in that time. When he started as a controller, there wasn’t nearly the amount of technology available as there is now. 

Technology brings automation and efficiency, and that frees time up for the controller to get out of the labor-intensive world of transactions and data analysis to a much more cross-functional role. 

When he started, everything was sitting in multiple spreadsheets, and functional business intelligence had to be pieced together from those files. That was very time-consuming and didn’t leave much time for actual analysis of the data. 

Now, controllers are able to use different automation tools that sit within their ERPs to take a lot of the manual labor off their plate. This allows Peter, as a controller, to provide more analysis and review. This then lets him be more proactive in strategy and analysis, as opposed to the old way of pushing numbers and reports up the ladder. 

Automation for Efficiency

Peter points out that a controller or CFO has choices when it comes to updating a process or function in the finance and accounting department. You could add more bodies to the process, which can make it cleaner, faster and stronger, but you have to take into account the additional cost of that labor. 

The other option is to explore whether or not the process can be automated. There are many options already available to integrate into existing accounting systems to automate many processes that have traditionally been done manually. 

Peter cites an example of using AI to assist with 80% of the data input of an accounting process, something that took a lot of time and effort to achieve. He and his team used to take it for granted that the data would be input manually, but with automation tools, only the remaining 20% needs to be done that way.

Jack admits that automating processes is what gets him excited and gets him out of bed in the morning. He says, “I hate something that’s hard coded in Excel.” He wants to be able to draw on the source data and apply some logic to get the information he needs in a repeatable process. Work smarter, not harder.  

The Changing Financial Leadership Role

As a controller, Peter’s leadership style is to lead by example. He would never ask any team member to do something he would not be willing to do himself. As he says, he’s never been afraid of getting down and working in the weeds. 

Occasionally taking a deep dive into the transaction workflow level helps him as a leader to provide more value to his team. By knowing how workflows and processes work at a granular level, he is able to provide informed direction and actionable, efficient advice on those processes.

Peter strives to equip his team for success, and that means knowing each team member’s preferences and work style. Some people want high-level coaching, while others may thrive on getting a specific set of instructions and being left alone, head down to get it done.

Setting team members up for success means delegating responsibilities so team members can get their jobs done without always having to check in with him for permission. His ideal team member is someone who is motivated to grow in their career, and he gets excited helping people advance.

Gold Standards

Peter has developed what he calls the gold standards for streamlining processes, improving efficiency, and empowering team members to do their jobs at the highest level.

The first gold standard is clearly defined and documented processes. When he started his career in public accounting, he quickly learned the importance of thorough documentation. He takes the approach that all of the department’s processes, whether it be daily tasks, tasks for closing, or closing the books, have to be properly documented. 

The goal is to get the documentation to the point where an independent third party could come in and reasonably perform all of the specific steps and properly complete the process. He wants anyone on the team to be able to complete any process in the department, regardless of whether it is part of their job. 

Another point of emphasis for Peter is implementing cross functional software tools. Many times a controller or CFO will only think of a new tool in terms of how it will be used in finance and accounting. But you have to take into consideration the other members of the organization who are stakeholders or consumers of the data generated by those tools. 

You have to identify those stakeholders and implement tools that will be affected by the implementation, and make sure it is used in a way that is adding value to their everyday job. Without constant communication between all the stakeholders about the pros and cons of each system, there are bound to be implementations that fail.

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