Hospitality Financial Leadership – Why Doesn’t My Director of Finance Step Up? – By David Lund
Your DOF is a great accountant. The director does a solid job running the accounting department and is very efficient. Your monthly financials are timely and overall the accuracy is high. The internal audit reports are very strong and they manage the accounting staff and departmental communications well.
What’s the problem then?
What you really want and what your business really needs is a DOF that is a “financial leader”–the kind of DOF that is going to teach and lead the non-financial managers in your hotel. You want the DOF to be as effective with the forecasts and commentaries as they are with the day-to-day accounting. You want your DOF to be the financial quarterback that calls the plays that move the money ball down the field. Not the record keeper who hides out in their office avoiding the world and your business. You want a financial leader that is going to tackle the issue your business faces and the trailblazer that gets results.
So, what’s missing? This article explores the other side of the DOF’s role. It’s the side that is not a natural place for most accounting types to be in. It’s the side that required the accountant to be a leader that serves his/her constituents.
“If serving is above you, then leadership is beyond you.” ~ Anonymous
I learned what it means to serve 10 years ago while I was the DOF of a large hotel in Toronto. I had been there for only a few months in my new role and things were not going well. I could not get the non-financial leaders in the hotel to meet any of my deadlines. Forecast, month end accruals, monthly commentary, budget time. You name it and they missed it. It was like pulling teeth to get the information I needed to do my job.
In the hotel business you cannot sit in your office and dream up what is going to happen next month in the kitchen, in sales, at the front desk. The hotel business does not work very well when you try and run it this way. As a result, I was putting out forecasts that were off by hundreds of thousands of dollars. Month end statements were a disaster that contained invoices from prior periods and accruals that were wrong. My month end commentaries made little sense. Does this sound familiar? In short, I was sure this gig was not going to last. I was either going to get fired, quit or have a nervous breakdown.
The owner’s asset manager and corporate would ask me, “David, what’s going on?” My response was, “We’re working on it,” all the while knowing that it was not working.
I had tried all the moves I knew to get the other managers to do their part. Monthly schedules, department head meeting reminders, emails, I even brought this up at the executive committee meetings—all to little avail.
Coincidentally, at the same time we had a new GM join us. We sat down shortly after the GM started and we discussed how things were going in finance and accounting. I explained my challenges with getting timely information and cooperation form the other managers. My GM had an idea.
“Let’s create a hotel finance workshop, we can call it hotel finances for dummies,” the GM said. To which I replied, “I’m not a teacher and look at my desk, I’m already here 10-12 hours a day.”
We discussed this idea a couple of more times in the next week and then the GM said to me, “David, it’s the right thing to do and I’m making it part of your bonus criteria.” Now it’s going to cost me if I don’t do it.
I really didn’t want to do this workshop. I was pretty sure it would suck and so would I. It meant getting up in front of a room full of leaders to talk about accounting all day and was not my idea of fun. It meant I was out there, exposed and all alone and the thought of that scared the crap out of me.
Human resources “invi-told” 35 leaders, the worst offenders, to attend the day long workshop. I somewhat begrudgingly set about to create the content for the workshop, putting ideas and concepts together to hopefully show the participants what all the noise was about with the financials.
The day arrived and class started on time and the room was full. The day went off OK and I did not die. Overall, I thought it was pretty good. There were a few shaky moments. A couple of the exercises could have been clearer. Some of my content could have been explained better. But all in all I thought the participation and interest from the leaders was good. I wrapped things up with a short 10 question survey and thanked everyone.
The next thing that happened totally blew my mind. Two leaders came to see me to hand in their surveys and they both thanked me for putting on the workshop. They said, “Finally, someone explains the P&L, why don’t we get this training from day one, I never knew what you did with my numbers.” Before I knew it, there was a pretty good-sized line-up of managers waiting to talk to me, to share their experience from the day. WOW!
In the following weeks, we scheduled another workshop and it was full without any conscription. In the short run in my hotel something very wonderful happened. I was now receiving most of the manager’s forecasts, accruals and commentaries on time and the quality was vastly improved. I literally had leaders coming to see me with ideas on how to save on expenses and labor and ideas on generating new revenues.
All of this was because of the workshops.
Inside this I learned a powerful lesson. And that lesson is Service. If you want someone to serve you, you need to serve them first. Serve them first meant I was educating and sharing important information with the leaders. The workshop showed the leaders that the P&L is not hard to understand. I showed them what we did with their information. They could clearly see that they were an important part of the financial machine.–a new-found understanding that they make a difference in our business.
So what was the pivot for me? The pivot was on one hand the creation and delivery of the workshop. The second and most important part of that was the change in my approach. Prior to the workshop I send out schedules, memos, directives, deadlines, department head meeting sermons and executive committee meeting winnings.
These seemingly innocent acts were nothing more than me, The Director of Finance, demonstrating my “expectations” to the non-financial leaders. There was no serving going on. Just my misguided and ugly expectation. People hate expectations being placed on them.
By serving them with the workshop I was able to turn this financial ship around. Leaders need a way to feel safe and welcomed in the financial arena. What can your DOF do to create their own safe place? What can your DOF do to serve your non-financial leaders? It’s the secret sauce to create hospitality financial leadership in your hotel.
If your DOF likes the comfort of their office and email to conduct business and uses that to engagement with your non-financial leaders with their forecasts, budgets and commentaries, and if the state of these living documents is not where you want them to be, now you know why this is the case.
If you want to create the financial engagement with the leaders in your hotel “someone” needs to serve them first. Non-financial leaders naturally do not want anything to do with their numbers. They have a predisposed fear around the financials. Someone needs to show them that it is not so hard and that there is a system to follow. Show them that you or someone is there to train, lead and support them and they will engage financially.
Once your managers see that they can do this, that you are there to provide the system and it is safe to step into the financial arena, they will want to do this. They will want to do this because being part of the financial “in crowd” is cool. They also know these financial skills are the ticket to greater career prosperity. Without financial leadership skills, their hotel career trajectory is severely limited.
Time and time again I ask budding non-financial leaders what they want from their career in our one-on-one coaching sessions. Hands down it is to be a leader that has financial acumen.
Chefs, F&B managers, spa managers, housekeepers, front office managers, etc., they all say the same thing, “I know my job, with the guests, the colleagues, the operation, but what I really want are the skills, abilities and comfort with the numbers.” They all want to be the leader that excels with their departmental and hotel financials. They know it is the way forward in their career.
What you need to do is provide the environment in your business where this can happen. The key to doing this is having a DOF that wants to be that financial leader. Time and time again in my coaching sessions I ask the DOFs, “What’s missing in your world?”
A high rate of response to that question is, “I want to have a greater leadership role in my hotel,” but inevitably that is not happening. When I hear this it is like magic to my ears because I know I can help this person create the financial leadership if they are willing to create their own version of service. I also hear a lot of financial leaders tell me they are just fine the way they are. To which I reply, great!
So, who will be that financial leader in your hotel? It will not happen by itself. It needs someone to step up! Do your part and help them help you.
To get a copy of my financial leadership recipe F TAR W send me an email: david@hotelfinancialcoach.com.
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The Seven Secrets to Create a Financially Engaged Leadership Team in Your Hotel
www.hotelfinancialcoach.com
Call or write today and arrange for a complimentary discussion on how you can create a financially engaged leadership team in your hotel.
Contact David at (415) 696-9593.
Email: david@hotelfinancialcoach.com
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Categories: Financial