Bean counting isn't enough - Vena on the CFO as chief data storyteller

Profile picture for user jreed By Jon Reed November 20, 2018
The CFO as chief storyteller? That's not an idea you hear every day. But as Vena Solutions CFO Darrell Cox told me, that's how you get real organizational impact. Here's how to get there.

The idea of intuitive financial planning and analysis across systems is appealing, given how clunky these solutions can be. I recently ran into Vena at Sage Intacct Advantage, demonstrating their Sage Intacct FP&A integration.

But vendor news doesn't get my editorial pen flowing. That changed, however, when Vena's PR peeps approached me with a pitch I don't see every day. The invite? Talk to Vena CFO Darrell Cox about data storytelling:

As CFO, Darrell considers himself the company’s Chief Storyteller. His role is just as much about investigating, understanding and sharing the stories behind the business as it is about balancing the books.

"CFOs can't just rely on the GL"

I'm in. So I got on the phone with Cox and asked him: how did he latch onto the idea of CFO as Chief Storyteller?

Well, I've been here for four years, and I guess the most remarkable part of the story about my experience at Vena is that when I first heard about Vena, I was kinda building things like Vena from scratch to do my job.

That's because I've always been, let's call it, a storyteller CFO. Of course, I balance the books and that kind of stuff, but I'm always trying to get to the root of what's going on.

But there's a catch for the aspiring CFO storyteller: you can't be limited to GL data. Cox:

You can't just tell me what the revenue is, or what the expenses are. I need to know: what does it mean that they are the way they are? To get to that, you can't just rely on the GL. You've got to bring on all this other data.

It's not just about telling stories though. It's about earning a seat at the table as a real strategist, not just a bean counter. If you understand the context behind the revenue numbers, your role shifts:

Now you can actually sit at the table and be a strategic business partner, and the CEO doesn't think of you like a nuisance who keeps the auditors at bay, but rather someone who can assist the business in making data-driven decisions.

Cox says Vena helps CFOs overcome the data islands that block this path:

The big challenge in being a storyteller CFO is bringing together data from these so-called data islands from around the company. Every area has got their own system of record, so there's Salesforce in sales, and whatever is in customer support. Then there's finance department with something like NetSuite. And those systems, the data in there alone, don't tell the story of the whole business - you've got to connect it.

Of course, Vena isn't the only financial planning tool around. Officially, Vena considers itself a CPM (Corporate Performance Management) vendor. Founded in 2011, Vena is a cloud-based CPM vendor bolstered by $30 million in funding in 2016. Their customer list indicates the traction they are getting, but let's be clear: even if you think you have the best technology to solve a problem, that's not the whole story. You still have an organizational challenge, a cultural challenge. No matter what tools CFOs choose, the problem of moving from bean counting (admin) to data-driven (strategic) remains.

Advice for CFOs - break down the data silos

I asked Cox about the origins of the CFO-as-storyteller concept.

I don't think it's an entirely new thing. I think it's something that financiers drifted away from, especially in smaller companies. If you are a public company, you certainly need a story to tell to the street. And there's a lot of really big companies with expensive IR departments and big software systems to help get that story out.

But in a smaller company, when you've got private investors, and maybe a board that's not completely functional, it's not the same at all. And so with the emergence of big data, which is a real thing, and those data silos, the story is getting lost in all the weeds.

Makes sense - but let's face it, getting traction with a new way of working isn't a cake walk. What advice does Cox have for CFOs that are early in this process?

It starts with, I believe, a mindset: are you in it for closing the books and getting the audit behind you and filing some tax returns? If that's it, then you're not there. If your mindset is that you want to achieve something beyond that, then what is the higher level objective?

The next step? Build the right team:

Some organizations aren't that receptive to data analysis... So you've got to get yourself in the right environment, with the right team around you, including the CEO.

One of my concerns from the analytics shows I've been to this year: yes, it's a lot easier to visualize data without massive IT investments. But does that mean we're making the right decisions?

Cox thinks the storytelling CFO can help there, framing the data and asking the right questions:

Someone's got to tell Tableau what to chart out. And someone's got to read that chart and collate it with another chart. It's back to: what are you looking for, and what's your objective? If you're just looking to cut expenses because the expense line is going too far onto the right, maybe you should be looking at it as cost of acquisitions instead - because you did add more customers, and your actual cost per acquisition trend is going down to the right, so that's okay.

Prepare for counter-intuitive conclusions. Sometimes the obvious conclusion from the data isn't the smartest one:

This is where the story gets interesting. Take cost per lead. Maybe that expensive lead converts at such a better rate that it's actually a lower cost per acquisition. Knowing that ahead of time, which is what you can get to with this kind of data analysis, you can make decisions faster, and more efficiently, and not waste as much money buying what you thought were better leads - but in fact aren't.

The wrap - drink your own Koolaid, and don't take Excel away

I asked Cox: shouldn't the new CFO get out more? Shouldn't they be talking to external stakeholders, etc? That's certainly the case for Cox. Prospective customers often stop by to get a look at their internal Vena implementation:

We actually have quite a lovely implementation of Vena. Our implementation is laid out like what a customer experience might be. We started with basic budgeting, basic recording, we integrated with NetSuite, and then we built an integration with Salesforce. And we started to cross-connect all the data.

That allows Cox's team to do Salesforce productivity analysis in Vena, including conversion milestones, how much each conversion costs, and the cost of acquisition in different channels. More advanced views include a weekly cash flow analysis, incorporating sales funnel data.

We talked about the impact of AI/ML on finance, with Cox observing that some use cases aren't terribly sexy, such as organizing and harmonizing data, or credit scoring. We also got into the state of the CPM market, with Cox feeling pretty good about Workday's Adaptive Insights acquisition (he believes it will further open up the midmarket, where Vena is focused).

Finally, I asked him about Excel. It seems like sooner or later, no matter how lofty your CFO vision might be, you have to reckon with the finance user's love of Excel. In Vena's case, they've managed to avoid that conundrum:

That's one of our biggest advantages, and it's rooted in our philosophy of being super easy to use. Think the way a finance person does... We give them Excel as the window to their data. So we can take the models they already have and just integrate them into Vena.

And yes, that includes Excel grid and version control. With that problem solved, we can get back to the hard work of CFO transformation. Maybe it's storytelling; maybe it's strategy. The change part is non-negotiable though.

Updated, 8am UK time, November 21 with added subheadings and tweaks for reading clarity.