COPENHAGEN, Denmark -- Chief executive officers must innovate to keep their businesses from falling behind in today’s hypercompetitive environment, stressed Lord Stuart Rose, Chairman of Ocado and former CEO and Chairman, Marks & Spencer, during a keynote speech Wednesday morning at the EuroFinance International Cash & Treasury Management Conference. He added that treasury and finance can, and should, play a big role in this process.
Rose noted that the businesses he’s been involved with ran into trouble when they failed to keep an eye on the pulse of change, failing to detect advances in technology, shifts in customer behavior, and more. “They all got fat, they all got happy, and they all got complacent,” he noted. “They looked inward, instead of looking outward.”
Change has always been happening, Rose said, but in today’s world, it is relentless. “Change is not continental; it is global,” he stressed. “More importantly, the pace of change is accelerating.”
Treasury and finance are teammates with the CEO
That’s why leadership now, more than ever, is about teamwork, Rose continued. CEOs are no longer equipped with all the knowledge to run a business singlehandedly. They need the support of the finance team. All too often in the past, treasury and finance were seen as a service functions, Rose noted. “Today, that’s no longer valid,” he said. “Today’s finance is at the center of the business.”
Rose believes that the relationship between the finance function and the CEO might be the most important relationship in the business. “It’s a relationship that demands absolute trust. It’s a relationship that demands absolute integrity. It’s a relationship that literally can make or break a business,” he said.
Today’s financial professionals need more knowledge and to be more involved than ever before, Rose stressed. Not only do they need an eye for detail and a flair for numbers, but they need to be a major manager of financial risk. “You need to understand the risks surrounding liquidity. You need to understand the risks around the exchange rate. You need to understand the risks around market volatility and the very real risks of fraud. You need to be the financial eyes and ears of the organization. You need to understand all the risks that your company can be exposed to; not just the ones that it already is,” he said.Check back here, or on Twitter, Facebook or LinkedIn, for more updates from EuroFinance.