Ira Apfel, Director of Communications and Editorial Content, AFP
Einstein is credited with saying, “We cannot solve our problems with the same thinking we used when we created them.” The same may be said of selecting the right FP&A person. So what does it take to be a great FP&A professional?
Curiosity. FP&A connects detail and the big picture by asking questions, by digging through data and applying frameworks and structure. The skillset is being able to see both the forest and the trees at the same time. The forest is the overall mission, goals and objectives of the business, and being able to dive down to the business operation and tactical level. The trees are the details, the tactics to getting through the forest.
Challenges can come from either end, the detail or the overall strategy. For example, a strategy to grow revenue and gain market share may come into conflict to general enough working capital to sustain operations, but you won’t know that until you can model out revenue, marketing and related expenses.
So how do we hire the right FP&A professional? Usually we look to fit people into openings on org charts and backgrounds that we recognize. That includes a background we recognize—industry, education, prior jobs. However, the challenges that we face cannot be solved by hiring more people like us. Hire for curiosity and competency, and the industry knowledge will come with the hard work of digging into details and comprehending the strategy. What you get by hiring someone outside the box is the cross-pollination of ideas. What was common in one industry may be insightful t to another.
How do we know this to be true? A Harvard Business Review article answer the question in its title, “Sometimes the Best Ideas Come from Outside Your Industry.”
When you’re working on a problem and you pool insights from analogous areas, you’re likely to get significantly greater novelty in the proposed solutions, for two reasons: People versed in analogous fields can draw on different pools of knowledge, and they’re not mentally constrained by existing, “known” solutions to the problem in the target field. The greater the distance between the problem and the analogous field, the greater the novelty of the solutions.
Corroborating this view of the strength provided by outsider is the output of Kaggle competitions. Kaggle is a website that hosts predictive analytics competitions. Kaggle president Jeremy Howard says: “Winners of Kaggle competitions tend to be curious and creative people. They come up with a dozen totally new ways to think about the problem.”
This new hiring model is even more important in a changing world, where sources and methods are in flux, and problems we face today are different than those we saw yesterday. We need to think differently, and this happens when we challenge our assumptions. There is value in deep institutional knowledge and there is value in novelty. The interplay of these two can produce best-of-breed solutions we may not have considered. We need to hire creativity, intellect, and a mix of backgrounds, and to always be curious.
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