The surprising role of individual talent in team success.
Updated 19 August 2016
A successful high-performing finance team is built on much more than just straight-A students and desk hours.
Rather, scientific studies and company analyses have consistently shown that effective communication is pivotal in team performance, directly impacting a company’s bottom line.
As finance functions face increasing pressure to “add value” in the modern business environment, not enough CFOs are focusing on the teams that will drive that success, says Stuart Bilbrough FCPA, CFO at Radius Residential Care in New Zealand and author of Bean Soup: Beyond Bean Counting.
Bilbrough says successful companies rely on finance functions for more than just “bean counting”, with finance departments contributing to day-to-day transactional and compliance processes, as well as delivering high-quality and interpretative data capable of driving business decisions.
But how does a CFO ensure his or her team is equipped and motivated to push beyond bean counting and actively seek out business opportunities and innovation?
Bilbrough says it’s a combination of an individual’s aptitude, effective team communication, in-house training, providing the right tools and technology, and continued motivation.
“When I’m hiring people, what I’m looking for is an aptitude to add value,” says Bilbrough.
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“If they haven’t got the skills set that we are providing, I can provide that.”
What’s interesting about Bilbrough’s approach is that he does the very thing many management teams deliberately avoid – he tells his team everything.
“Part of keeping people motivated is communicating everything, telling them everything that’s going on unless it is really, really sensitive,” he says.
“I let them know everything because nobody can be innovative if they don’t know what’s going on.”
Science backs up this strategy with hard data.
A study by MIT’s Human Dynamics Laboratory, published by Professor Alex Pentland in the April 2012 issue of Harvard Business Review, was not only able to break down the very factors that characterised a high-performing team but accurately predict which teams would be most successful based on those characteristics.
Using wireless sensor technology, about 2500 team members over a period of seven years were fitted with a badge to capture their behaviour, generating more than 100 data points per minute. The badge produced “sociometrics”, measuring a person’s tone of voice, whether they faced one another, how often they used gestures, how often they talked, listened or interrupted, as well as their levels of extroversion and empathy.
The data was then compared, revealing some consistent findings.
“Productive teams have certain data signatures, and they’re so consistent that we can predict a team’s success simply by looking at the data — without ever meeting its members,” Pentland writes.
“We’ve been able to foretell, for example, which teams will win a business plan contest, solely on the basis of data collected from team members wearing badges at a cocktail reception.”
What was more surprising was that individual talent contributed far less to team success than initially thought.
“The best way to build a great team is not to select individuals for their smarts or accomplishments but to learn how they communicate and to shape and guide the team so that it follows successful communication patterns,” Pentland notes.
It’s an approach that has been executed successfully by Ken Christie FCPA, CFO MLC and Wealth at National Australia Bank (NAB). What Christie found is that trust is crucial to building effective team communication.
While CFO at Bank of New Zealand, part of the NAB Group, Christie set a goal of becoming a world-class finance function within a five-year period. It’s a goal the team hit, winning numerous awards along the way. The journey started with building team trust.
“We spent a lot of time building that base level of trust to the extent that we had a clinical psychologist who came in and worked with us as a team to really understand each other’s quirks and nature and what sets people off,” Christie says.
He found that identifying the ability to work and communicate with a team is key to hiring the right staff.
This means Christie places less emphasis on a person’s technical qualification, which he describes as a “given”, focusing more on a person’s emotional intelligence (EQ), a skill that enables better communication.
“I’m after really bright people because I’m a huge believer that if you have really bright people with strong EQ, you can just about do anything,” he says.
Christie is adamant about the criticality of finding the right staff, so much so that he will hold back on a role rather than hire someone who is not up to the challenge. This is something he uncovers during a rigorous interview process, which can last anywhere between 10 and 15 separate interviews.
But once you’ve found the right staff, how do you ensure they are equipped to handle the expectations of the role?
“The biggest challenge that we always face is ‘how do you get the commercial skills into a junior finance person so that they look at a problem from a commercial perspective rather than just an accounting perspective’,” Christie says.
Like Bilbrough, he believes internal training is important in building team skills. He implements a 70/20/10 rule, where 70 per cent of training is on the job, 10 per cent is external, and 20 per cent is provided in-house via themed “blitz weeks” or through the leadership development program, bringing staff up-to-speed on issues relevant to their roles.
How top-performing finance teams stand out
According to CGMA Magazine, four factors set top-performing finance teams apart from the rest:
- Cost efficiency
- Fast turnaround
- Sharp insight
- Lean operations
How to improve your finance team