Unlocking creativity: How CFOs can help cultivate a creative mindset has been saved
Unlocking creativity: How CFOs can help cultivate a creative mindset
In this issue of CFO Insights, we’ll explore the organisational barriers to unleashing the creative capabilities within companies and investigate what CFOs can do to foster a culture of creativity.
- Becoming mindset readers
- Fostering creative confidence
- Transformation through innovation
- Getting outside
Messy. Chaotic. Nonlinear. Such words are typically not used to describe an effective CFO. But those traits, which are often associated with creativity, may be the ones finance leaders should consider nurturing throughout their organisations—all in the name of growth. It is a concept not lost on their bosses. In fact, in a survey of CEOs across 33 industries
and 60 countries, they identified creativity— above rigor, management discipline, or vision—as necessary for leaders to
successfully navigate an increasingly complex business environment.
For their part, finance executives—who, for the record, typically tend to be disciplined, predictable, and analytical—play a vital role in fostering that needed creativity. While CFOs aren’t expected to be the originators of breakthrough products or technologies, they can help build organisations where innovative ideas are identified, financed, and delivered. And in an environment where topline growth is still paramount, those ideas— and the strategic investments needed to execute them—may just be the key to future competitive advantage. We’ll explore organisational barriers in this issue of CFO Insights and investigate what CFOs can do to foster a culture of creativity.
Becoming mindset readers
The case for creativity seems more apparent than ever. One reason may be the current growth shortfalls at some companies. A recent analysis of Fortune 500 companies found that more than one-third (38 percent) experienced a decline of revenue between 2014 and 2016. Another driver may be the looming prospect of an economic downturn, which may force CFOs to look for original ways to boost efficiencies at their already-lean organisations.
However, a prospective downturn may also be an opportune time to invest in innovation, calculating tradeoffs that need to be made to emerge from any decline—which 80 percent of CFOs expect to be mild, according to the Q2 2019 CFO Signals survey—with a competitive edge over their creativity-challenged peers. To position themselves that way, though, finance chiefs may have to become alert to organisational barriers that might be suppressing their company’s creative impulses. The report outlines such mindsets and how they manifest in a variety of ways.
Fostering creative confidence
To facilitate creative thinking, CFOs don’t need to abandon their roles as stewards in the organisation. The sense of discipline they can add to the creative process is critical. In fact, as the drive to innovate increasingly becomes a standard part of doing business, it’s often up to the finance leader to weigh the overall impact of new ideas. They need to make sure that the organisation’s portfolio of creative risks remains balanced between short-term profits and long-term growth, for example.
By instilling the creative effort with clarity and accountability, CFOs can harness it to drive the company’s growth—which is, after all, the goal. To start, however, they need to model creative thinking, both in how they perform their own jobs and how they support others. Some effective ways can include the following:
- Reframe questions
- Encourage low-cost experimentation
- Practice operational flexibility
- Develop fitting metrics
Read the full report to learn more about these methods.
Transformation through innovation
By finding ways to assess creative ideas, CFOs can help guide their businesses toward taking the right risks. After all, in the face of so many challenges—an accelerating pace of change, an increasing influx of competitors, the growing expectations of customers—sustaining profitable growth requires a bigger effort than, say, expanding distribution.
To do so, however, demands both curiosity and courage—traits that many CFOs have honed over years of experience. And having their hands in the process can help move everyday innovation (i.e., incrementally adding new features) into transformational creativity that establishes new platforms for future growth.
Getting outside: Why other industries may be the best source for big ideas
In search of competitive advantage, companies often look no farther than their own industry for ideas they can apply to spur growth. But if the goal is to set themselves apart, they may be facing the wrong direction; the more successful they are at copying direct rivals, the less differentiated (read profitable) they could become.
Instead, says Professor Roberto, companies ought to benchmark outside their industry. The author of Unlocking Creativity suggests that CFOs and their C-suite peers encourage the business to search for inspiration in different, if tangentially related, fields.