Going green: Whole Foods’ financial director Glenda Flanagan

Next in our series of inspiring female financial executives is Glenda Flanagan, CFO of US-based organic grocery chain Whole Foods. Flanagan is the longest-serving female financial director in a Fortune 500 company. She took the position in 1988 and has seen the company grow meteorically over the last three decades.

Unlike many other women in financial director positions in heavyweight companies, Flanagan did not have an illustrious career before joining Whole Foods. Qualified as a public accountant (the USA’s version of a Chartered Accountant), Flanagan had taken time out of full-time work to be at home with her children when they were small. She had helped run an office supply store just outside Austen, Texas and done some consulting work during this time. Flanagan was “ready to get back into work” when she was referred by a friend to the company, which was searching for someone to fill its financial director role at the time.

When Flanagan joined Whole Foods, now ranked 18 on Fortune’s “World’s Most Admired Companies”, it was a fledgling “hippie” operation with six stores. Today, it has revenue of $14.2-billion (as per its most recently-ended fiscal year), and an annual profit of $579-million (a number that has tripled since 2007). The company employees almost 73 000 employees and has a market value of $18.8-billion. Flanagan has helped steer the company through this steep upward trajectory. As the company went from strength to strength, Flanagan found herself needing to develop different facets of herself in order to grow with the company.

The art of forecasting

One such example was when the company listed in 1992. “That was a completely new experience for me,” Flanagan told Fortune. “You are expected both to be able to explain exactly what has happened with your financial results and predict what is going to happen with your financial results. People tend to think that there is a lot more exactness to the forecasting of the future than of course there is. So I spent a lot more of my time, suddenly, on investor relations: talking to shareholders, talking to analysts and the whole investment community.”

Sprinting to keep up with demand

Flanagan was also required to help the company weather sharp bursts of growth – sometimes sooner than the company was ready for it. The first of these took place in 1989 / 1990 with the “Alar scare” – a public backlash to the purported negative effects of Daminozide (or Alar), a chemical sprayed onto fruit to stop them from falling off the tree before they are fully ripe. The scare sent consumers running into Whole Foods shops. The result was that the company’s initial financial plans, drawn up on a spreadsheet one of the first Apple Macs, “wasn’t as grand a plan as the reality turned out to be”, said Flanagan. As financial director, she needed to be incredibly resourceful in order to maintain cash flow as the company expanded. Every new store built initially was a massive drain on finances.

Creative energy

Over the years, Flanagan has also had to strike a balance between maintaining the entrepreneurial spirit of Whole Foods (the company is still run by its two co-founders, John Mackey and Walter Robb) and, as financial director, making sure that decisions remained financially prudent.

“I have less of the entrepreneur in me, certainly, than John and Walter. But that doesn’t mean that they’re out there with all these wild and unreasonable ideas and I have to be the one to bring them back down to earth,” said Flanagan. “It’s really not like that. In the process of developing ideas and concepts and processes, I get to bring creative energy, too.”

Harnessing the market

And Whole Foods’s financial director is channeling part of that energy towards helping the chain usurp some of the regular grocery store market, despite the fact that its prices are comparatively high.

According to food industry tracker Penton’s Next, healthy, organic, and natural products constitute an estimated $150-billion market that’s expected to grow by about 50% by 2018. Whole Foods is better situated than any other chain to take advantage of this, and Flanagan (61) has more experience and insight than anyone else to help lead them there.

And, perhaps because the senior management of this company has remained cohesive throughout its prolonged growth period, when Flanagan was asked about the most valuable lesson she has learned at Whole Foods over the past three decades, the financial director said: “The value of the team. It is so important for the team to be aligned on purpose and principle. It helps all feel inspired and empowered.”

This once-tiny hippie company with a vision looks poised to take over the global health food market, one jar of coconut oil at a time.

If your company is looking for inspiring financial leadership, contact The Finance Team. Our financial executives can help your own company to ultimately take on the world as well.

 

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August 25, 2015 / No Comments /  
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Three characteristics of a top class finance director

Every company in the world needs someone to take care of their finances. It could be in the form of a company accountant, a finance manager, a bookkeeper or a high-flying CFO. Finance directors come in various shapes and sizes, but they are undoubtedly everywhere! With so many finance directors around, it becomes difficult to distinguish yourself from the pack. What makes the difference between an average finance director – of which there are hundreds of thousands – and a top class finance director, of which there are considerably fewer?

1. Double vision. A high caliber finance director is able to see the big picture and simultaneously have a fine eye for detail.

As a finance director, it’s crucial to be able to see all the problems the business faces in context of its overall vision. Where does the business plan to go and what does it hope to become? If the business is facing a dip in sales, is this due to external factors such as economic conditions in the country, or is it due to something that needs to be changed internally?

At the same time, a really good finance director can look over a cash flow forecast and spot one wrong number within minutes. He or she needs to be able to oversee the financial calculations of the business and ensure their accuracy. A great finance director derives satisfaction from both big picture work and detail work. He or she is both a box-ticker and a visionary.

2. Builds strong relationships with the operational business team

An unfortunate stereotype about accounting staff has arisen, which is that they are not known for their people skills. The personality types that are drawn to financial roles are often introverted and self-sufficient, preferring to work by themselves rather than in a team. But top class finance directors recognise the importance of building relationships with the people and teams surrounding them. They know that their own success is contingent on how well the sales, production or service teams carry out their own mandates.

As the finance director, you’re required to communicate your budget expectations with all other department heads. Sometimes these are difficult conversations to have, and inevitably, there will be a few people who are dissatisfied with their department’s budget allocation. A skilled finance director can get other managers to buy into the budgeting planning and control process. They foster a collaborative process rather than the “us versus them” attitude that sometimes arises when other leaders are not on board.

3. Copes with change – on the double

Exchange rates change every day. The price of commodities is constantly in flux. Inflation goes up and down every month. Interest rates can change regularly. These and other factors drastically affect your company’s ability to do business, the amount of cash coming in, and the amount you can afford to go out.

An average finance director reacts to the changes. He alters forecasts and informs the CEO of the impact of environmental fluctuations. A top class finance director anticipates the changes. She stays in touch with factors that could affect sales or production in the business. He conducts scenario plans outlining possible situations. When change happens, she acts on it by managing for the outcome. He makes quick, confident decisions based on effective planning and the confidence afforded to him by insight, experience and preparation.

The finance director who wishes to be distinguished from the crowd needs to hone in on these three skills. If you’re wondering where to find a professional who exhibits these strengths, The Finance Team can provide one. We have a network of highly qualified, experienced associates who can assist your company on a part-time or interim basis.

Image credit: newsinmind.com

 

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December 29, 2014 / No Comments /