T-Mobile's Peter Osvaldik, recipient of the 2024 CFO of the Year award from StrategicCFO360 and the CFO Leadership Council, reflected on his promotion from accounting and management and had the following message for the finance executives in attendance: said. The next generation of CFOs:
“Be proud of all the effort you put in. You are entitled to it because you are here, but we have a responsibility to pay it back to those below you. Start. Give them the opportunity that someone gave you.”
Speaking to finance executives gathered at New York's Rockefeller Center just before the holidays, Oswaldyk acknowledged that accounting and finance organizations face challenges, but was “very bullish” on the profession. said. Finance executives “need to get people on board and we'll continue to grow it,” he told the audience.
In Oswaldyk's view, for finance executives and finance departments to grow, they need to embrace the role of strategic partners. Potential entrants to the field will find the strategic aspects appealing, as AI and automation streamline or replace unattractive manual and repetitive tasks.
However, while being a strategically thinking CFO is essential, it is not easy. How do CFOs and their teams get a seat at the strategic table, drive the organization's financial goals, influence the company's strategy, and put that strategy into action?
Mr. Osvaldyk addressed that question and others in his remarks. The key points he made were:
Strategy follow-through
Translating strategy into actionable day-to-day insights is at the core of a CFO's job. Every company has a strategy. But Osvaldyk asked whether the company's strategy is deeply understood and driven by momentum. As a CFO, do you know how your strategy is reflected in your financial activities this quarter and in the years ahead? (1) Are you making the right financial investments in strategic areas? (2) ) Are you sure you understand how achieving them will meet your company's financial goals?
need passion
How can finance become a strategic partner of business and avoid the tendency for finance to remain siled? “One of the things that made me successful was having a passion for business.” said Osvaldyk. “When you love business, you see your role goes beyond accounting and finance.” Successful CFOs have an innate curiosity about business, says Osvaldyk. Do you understand your operational processes? How does the creation of corporate value lead to value created in other parts of the organization?
say “no” clearly
While it is essential to understand the issues facing your business partners, your business partners must also understand your financial challenges. “A lot of what we do in accounting and finance is hidden behind complexity,” Osvaldyk says. “I think the best experts in this field are able to take something that can be very complex right off the bat and translate it into the rest of the business.”
This includes when the finance department has to refuse funding for a new project or business idea. “Are you telling them why you're saying no?” Osvaldyk asked. He encouraged CFOs to be open about their “why.” What are the constraints? Are they financial constraints for the entire company, or just in some areas? Why would we fund that project and not this one? 'I'm here to work with you to solve the problem,''' says Osvaldyk.
M&A: Ask why
While the April 2020 merger with Sprint was a straightforward and compelling value creation opportunity that combined the number three and number four companies in the wireless market, Oswaldyk said that and other M&A transactions. Oswaldyk said some of the deals appeared to be made solely for the purpose of distracting the investor community from underperforming businesses or providing air cover for CEOs.
“Ask yourself why you are doing this merger. You have to make sure there are underlying factors,” he said. Excessive enthusiasm, deal fever, and overestimation of revenue and cost synergies are common.
“We need to make sure that the strategic and financial business case for the merger is one that involves reasonable risk,” Osvaldyk said. How does this business fit into the overall strategy? Who will be responsible for it? In some cases, Osvaldyk says, the business case sounds great and the board approves it. Business case applies. When that happens, the business or product is sidelined and “becomes a science experiment without the right level of accountability.”
AI: Still on board
Oswaldik said AI will change the nature of financial functions, but its adoption and application in finance is still in its infancy. CFOs need to think about AI and its ability to revolutionize processes and functions, but the world is in the future, he said. “If you're worried that the AI train has left and every company around you is fully automated and has predictive analytics at the push of a button, don't worry. It's still there. We haven't even reached that point yet,” Osvaldyk said.
T-Mobile's Osvaldyk oversaw the merger of T-Mobile and Sprint, which has generated more than $70 billion in shareholder value since 2020, and was recognized for “leading wireless carriers to new heights.” Selected as 2024 CFO of the Year. The award committee also took notice. Osvaldik's success in T-Mobile's financial strategy during unprecedented growth and transformation. Mr. Osvaldyk joined T-Mobile in 2016 as Senior Vice President and Chief Accounting Officer.
