CFO Navigation Series: Paths to the Top Part 2
In continuation of the CFO Navigation series, I caught up with Igor Merkin, GM Operations at Stockland Retirement Living to get his take on roles outside of finance, and what benefit they can provide for individuals with CFO aspirations.
Igor has experienced the benefits of internal moves, working in finance and non-finance positions and through the questions and answers below Igor gives us some insight into those benefits and some advice if you are thinking of a stint out of the finance stream.
1) What prompted a move away from finance? And what advice would you give people currently considering a move out of finance to broaden their skill base?
I worked for nearly 15 years in various finance and strategy roles, predominantly in the advisory and subject matter space. This resulted in a desire to challenge myself in a more business facing role; one which had complexity, P&L responsibility and leadership of a team.
The advice I would offer people considering a move out of finance is: firstly, to be clear on what you want to gain exposure to, and what you will get out of the experience and secondly, think about how you can add value in this role. I have found a strong finance and commercial mindset is ideal, and transferrable to most roles, so I would say it is important to target roles that still allow you to utilise that commercial acumen.
2) What additional skills / value do you feel experience outside of finance has allowed you to bring to the table?
My experience in strategy and corporate development provided me with exposure to the executive team and board members, which has provided me with a better sense of what to look for in determining value creation for the business and shareholders and furthermore, how to effectively manage risk.
3) Over the last 8 years there has been a great deal of 'moving out to move up' as opposed to progression within one organisation - obviously there are many factors as to the cause of that, but having done the latter and progressed swiftly within Stockland, what value do you see in staying somewhere for the long haul?
There are considerable benefits in taking opportunities within one organisation. I have had 5 roles across various business units and within Group functions; each opportunity has challenged me and grown me professionally – this was made possible through my business knowledge, the business models and the key stakeholders involved.
In addition, progression within one business allows you to build a reputation and deliver results that open doors to opportunities that are unlikely to be available externally, particularly if moving out of finance and competing with experienced non-finance individuals.
4) It is widely highlighted in meetings I attend that having the ability to build rapport and strong relationships internally is crucial in order to progress internally - Do you agree? And if so, how have you been successful in identifying good internal contacts and building these relationships?
Building strong, mutually respectful relationships is always important. However, to find new opportunities and be successful in them, you need to ensure you maintain credibility to earn that opportunity. Meaning, you absolutely need strong relationships and supporters in the business, but results, hard work and dedication are the loudest voice in making you appealing for the next opportunity.
5) If you were recruiting your successor tomorrow - what 3 attributes would be top of the list?
• A People Leader – true sustainable success will come down to how well you lead your people. The ability to set a vision, inspire commitment and lead by example is paramount to having a team that will excel and aim to overachieve. You want to be able to create a work place where people feel challenged and respected
• A Problem Solver – The ability to breakdown problems or assess a challenge in a way that can then be systematically worked through is vital. Our days are full of problems and challenges – large or small. A person’s ability to approach these problems, and how they are effectively solved, will be crucial.
• Value Creation – To be a future leader regardless of CFO, CEO or COO, decisions need to be assessed under the umbrella of ‘how will it create value’. We must remember our role is to create and protect the value of our shareholders. I started to apply this approach and I noticed an immediate change to my thinking, decisions made and my approach to leading the team. This thinking forces you to understand the business model, what drives value creation and how you or your team play a part in that.
6) Do you have a mentor? If so, how did you select and approach them?
They are less mentors and more trusted advisors. There are a number of people with varied backgrounds / experiences that I trust deeply and depending on the topic, I would seek their advice and opinions. I have never targeted any one person in particular, our relationships were created and developed through work or networking. All of these individuals have similar characteristics; they have diverse experience and leadership styles, can be trusted, are independent and have your best interests at heart.
7) As a property specialist, how do you see property in Australia currently and where do you see the challenges in 2017?
Property is always evolving and is full of challenges, but that also brings opportunity. As it has been well documented, NSW is enjoying a very successful period of strong demand especially in the residential property space – whilst the complete opposite can be seen in WA on the back of their state economy. It is best to separate property classes to answer the question: -
Residential – will always be in demand if our population continues to see sustainable growth and stable employment is maintained. Challenges for the residential space will be affordability and infrastructure supporting its growth. These are a big focus for us and something we are working hard to manage effectively.
Commercial – These assets have been enjoying strong interest from international buyers and corporate consolidations. There will always be demand for retail and office, the challenge is to have an asset that is flexible to changing demands and traits. Industrial is a very interesting asset class given the increasing appeal of online shopping and imports; the reliance and location of these assets is very important and a class we see as a growth area.
Retirement – An asset class I am very close to at the moment. These are the villages and communities that could be stand alone homes or apartments available for retirees that are still able to live independently, but want more convenience and less hassle.
This asset class has been around for a while, but given the increasingly aging population and resulting number of retirees, the desire for more manageable and enjoyable retirement options have been appealing for customers and investors alike. The challenge in this class is differentiating it from Aged Care, which is more about providing health care needs as apposed to Retirement living - which is more about an active lifestyle and independence.
The other challenge is ensuring supply keeps up with demand, given the competition for development land with residential developers. Overall though, the fundamentals of this class are strong and if managed well, could be a really attractive residential product for the fastest growing age group in Australia.
8) Lastly, what do you do to unwind and what is important to you outside of work? How do you feel this contributes to your professional success?
I think it is vital to ensure there is balance and ample time for the body and mind to refresh itself. Often this sounds easy, but I appreciate it is easier said than done, especially with a young family.
For me, I unwind with some morning fitness classes, or during the weekends, its usually breakfast with the family at the local beach. At Stockland we have introduced something to aid employees with balance called ‘One Simple thing’ and I personally am a big fan of it; as a business we encourage all our employees to have one flexible component to their work structure. For me, this results in not booking meetings prior to 9am so I have the opportunity to spend time with my family first thing and take the kids to school, as I am unlikely to so see them in the evenings before they sleep. It might not sound like the most relaxing start to the day, but it brings me the balance I need.
I do not believe there is a 100% optimal balance between work and life outside of work, however, I believe successful people just know when to prioritise one over the other; knowing when to say no to work – it can wait until tomorrow. To be effective in this way, you need to be confident in yourself, your role and managing the expectations of the business and stakeholders – It is always important to remember that we all have different limitations to energy and focus level; investing time in refreshing them is key to success.
I really enjoyed the conversation with Igor as he has a great approach to life, business and success. From the answers he has given, it is clear he thinks and plans before making moves so that he has clarity of the pro’s and con’s before he approaches it; if done effectively this approach rarely fails as the enablers of your request see the path and logic to the request also.
Igor mentions value creation as a major factor in his experiences, within and external to finance, and this now drives all of his actions within business – a fantastic approach as how many executives, shareholders, managers, peers or team members will have a problem with something you are implementing that drives value creation??
In these times, we have seen a lot of movement due to flat structures, redundancies, off-shoring or outsourcing of opportunities and a whole myriad of additional reasons for people deciding to ‘move out to move up’ which certainly has positives attached to it but sometimes I believe it is over looked when considering the value gained from progression internally and Igor mentions that one of those positives is that you often get opportunities that if you were external would not be in consideration for. Reputation and results in the business enable opportunities out of finance or in finance but in a totally different sphere, where if external you would be against development managers for example and not get a look in. Whilst I am not saying sitting in the same business for 25 years is the best option I would suggest it is worth understand what is on offer internally that would not be externally, particularly if a move out of finance for a stint is on your mind.
Do you feel like you have trusted advisors around you? People that you could absolutely trust implicitly? Something to consider as it has been a common theme recently to have a mentor and whilst I see value in a mentor I also see sense in having a network of people to seek advice from. Good advice.
To wrap up, be clear on what you will get from a move to non-finance and what the business will get in return, always seek to create value in everything you do for the business, the staff and the shareholders, Lead don’t just manage, come at a situation in problem solver mode and crucially, try to maintain a level of balance between your work and your personal life.
Wise words, I’m sure you will agree. If you are reading this and have any thoughts of your own on the topic please comment or email me directly on the details below.