631: Explaining the Business Reason Behind the Number | Steven Springsteel, CFO, betterworks

Back in the early 1990s, Steven Springsteel nabbed an interview for a CFO role with a high-flying tech start-up. At the time, he was controller for Apple’s worldwide manufacturing operations, but the buzz surrounding the brash start-up intrigued him, and the young but accomplished executive shortly found himself waiting to be interviewed by the firm’s CEO. According to Springsteel, his interview aspirations quickly became somewhat tempered as he sat listening to a stream of expletives originating from the CEO’s office. Within minutes, the CEO’s door swung open and several long-faced engineers beat a hasty retreat, to be followed by a smiling and gracious Steve Jobs extending a hand to Springsteel. “I’ve heard a lot of great things about you! Can I get you something to drink? Are you hungry?” Springsteel remembers the legendary tech innovator saying before explaining the role that he had in mind for the CFO of NeXT, Inc. Recalling the interview, Springsteel says that he felt that he had just met with “the nicest, most charismatic guy that you would ever meet in your life.” Of course, Springsteel had reason to doubt first impressions, having for a number of years worked at Apple, where stories circulating about Jobs’s darker side were plentiful. What’s more, a book titled Steve Jobs & The NeXT Big Thing (Scribner, 1993) had only recently been published, and Springsteel had made a point of reading it prior to his interview. According to Springsteel, the text relates the experience of an Apple employee who was hired by a very gracious Jobs only to experience his darker side a short time after joining the company. Springsteel says that Jobs’s evil twin was only one of several issues that led him to look for CFO roles elsewhere. In the end, he says, “I just didn’t believe in the business model.” –Jack Sweeney Springsteel: First, let me start off by saying that with every management role that I take there are four key operating principles that I run by, and I explain those to the team right upfront. The first operating principle is, never say no without giving options. It's very easy, particularly in G&A roles, when someone comes to you with a proposal to say, "Well, you can't do that. "Sorry, Jack. I know you want to spend that money or structure the deal that way. We just can't do that." But you're not adding value when you do that. But, if you can now have that conversation with Jack, understand what's the business result he's trying to achieve, work with him on developing options, now you're adding value. So the first principle that I sell is, never say no without giving options. The second principle that I sell is, think in terms of the business. When someone comes and says, "Well, what happened that our expenses went up last quarter?" Let's say I have an answer of "Well, we had a large accrual for compensation." Well, that doesn't tell you anything. Give the business reason behind everything. Look behind the numbers to articulate the story of what happened that answers their question. The next two are open communication. My staff, we're going 200 miles an hour, but everybody knows what the other people, the other groups within my organization, are always doing. That helps because then you can leverage. And then very often, somebody will hear something that sales is thinking about a promotion that affects maybe some other groups within my team that they didn't know about it, and so that open communication is key. Then the last thing is, no surprises. Bad news does not get better with age. Let's get it out upfront. We don't like surprises. Give me an early head's up on things, and if I have an early head's up, then I can help you. Or other people on the team can help you get past this, and all of a sudden, what was the negative we can turn into a positive. So, I start off with those four key operating principles.