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And now onto the show.
From Data Rails, this is FPNA today.
Welcome to FPNA Today.
I'm your host, Glenn Hopper.
Our guest today is Taylor Otzdot, VP of finance at Dashlane, former GoDaddy finance leader and the author of CFO Frameworks, a sharp new newsletter focused on the strategy side of FP &A.
He's built and led high -performing finance teams, and he's not afraid to call out lazy analysis, bad dashboards, or buzzwords that don't mean anything.
Taylor brings a clear point of view on how FP &A can drive real business impact, and today, he's here to break it down with us.
Taylor, welcome to the show.
Thanks for having me, I'm really excited to be here.
Yeah, it's funny, I love what we called out in your intro of lazy analysis, bad dashboards, and buzzwords, because to me, being on LinkedIn a lot.
I mean, you see these buzzwords and you just, it's almost cringey a lot of times.
Yeah, there's a lot of empty calories out there.
Yes, yes, exactly. So, and everybody wants to be an expert too.
That's true. Well, speaking of experts, not that I've set the bar probably too high or whatever, or now the audience is gonna be like, wait a minute, how are these two different?
Seriously though, tell me about your history and background and kind of where you started and where you are today.
Yeah, you bet. So like a lot of folks, I started my career in audit.
I did EY for the better part of four years.
You know, variety of clients from small to big to public, private, and really through that discovered that, that was not for me.
I love the people, love the culture, just did the work.
Didn't resonate with me.
And I think a lot of the big part of that is one, I struggled with being presented with finding problems and not being able to solve them.
And I also struggled with all the problem finding lacked any creativity.
Right. There was a template for everything, and I sort of wanted to go off the beaten path.
And that was not something that you typically do.
I don't know if you maybe don't want your auditor going off the beaten path.
No, probably not. Right.
And it's one of those things where that's how you learn.
But the way that that mechanism worked is it's a machine, and you want everyone to just follow through the machine.
And not to deride it, I think it's a super valuable career or even start of the career, but I had hit that point where I was like, I just want to go and do something a little bit different.
And that's where finance really, or FP &A really appealed to me.
To get that FP &A job, I actually had to do a stint where it was more of a hybrid role, where I did some accounting and some FP &A and I did a real estate investment trust that had gone public the year prior, you know, that not my my favorite job that I've ever had, but super valuable, and just learning what FP &A was and saying, Yeah, this is what I want to dedicate my time to.
Through all that I had gone through an acquisition that doubled our size, we were doing first year socks, we were doing a whole ERP implementation.
So it was like, great, love the chaos.
But real estate is not the thing that gets me up in the morning.
And the one thing that I appreciated about my audit days was, I don't mind working hard, I just want to care about what I'm working on.
And it was hard to get up and care about real estate.
So that's when I decided to go make a pivot and I went to GoDaddy and I joined about a year before their IPO.
At the time, they're about a billion in revenue.
I came in as a senior financial analyst and just kind of did the dregs and worked my way up over the course of eight years.
By the time I left, I was a senior director running a team of about 14 folks running the FP &A support for a variety of business units, our largest PNL, all of our horizontal functions, like marketing and sales and support, and then a bunch of attached acquisitions that were raging in size from, you know, 10, 20 million up to like 50 million.
Love that. The same thing, love the culture, love the people.
Eight years is a really, really long time to be in one place.
And I was starting to get that itch to go do something different.
And that's what ultimately lead me to Dashlane where I am the VP of finance here.
I run our FPNA group.
I also do all of our investor relations and talk to our board. and I even did a stint where I was running our analytics team for a period of time.
So over the course of all those years, you know, how did the opportunity to see companies of varying sizes at varying stages, but like the crux of it, the core of it has always been, hey, we're here to help people make good decisions.
How can the finance team enable that?
Yeah, I love that you've ran the analytics team for a while because there's really such I mean, the Venn diagrams from analytics and FP &A.
It seems like they're, you know, they're they're starting to eclipse each other.
It's almost one circle.
Yeah, yeah. I love that background.
And I also love the audit background.
I've talked to so many people lately who started out in audit and made the switch. And I wonder, you said you did it for four years and it was long enough to know that that's not what you wanted to do, but I've got to think that what you learned and sort of getting your reps in on accounting basics, I mean, would you trade that for anything?
Do you wish you had done it for a shorter time or do you wish you'd gone straight into more of an FP &A role?
What's your thinking looking back at it?
For me, it was perfect and I think for most people it is, you know, I, I think the hardest thing is, is it, if you don't want to be an auditor or you don't want to be high -level accounting, there is a certain point where you could be in it too long.
I think for me, the three to four years was perfect where I got that background and not just the accounting background, but also being able to think about problems in novel ways, right?
Like depending on what engagements you're on, you may be presented with a new you know, accounting issue or a new line of business, and he to figure out, okay, how are we going to approach this one.
And we have to get comfortable with something that is by definition, someone ambiguous.
And also, by the way, you can't go to the level of detail that like an accountant would go, because you can only be on the engagement for so long.
So you know, I probably spoke a little bit too decisively about the lack of creativity, there's some creativity where it's like, how do we get comfortable with something without knowing it, we have to know it well enough, right.
And I think that was a good just broad especially when you're thinking about FP &A where, more times than not, you can't know until the thing happens.
So how do you get comfortable with an appropriate level of ambiguity, and more importantly, how do you reduce ambiguity efficiently?
Yeah, yeah. And it's, you know, thinking about that transition and I talked to a CFO, he's actually become a good friend of mine over the years, but he loves the accounting side of it to the point where he loves, you know, sort of the credits and debits and matching the T -sheets and that is really appealing to him.
And I think those are the people who stay with that accounting focus.
And we had a guest on a couple of weeks ago, and we were talking about the same thing.
She made the transition from audit into finance.
And she said that for.
People who stay kind of on the accounting side, a lot of times they do it because they're not going to be okay with being directionally.
Right. You know what I'm like, it's not, it's, we need everything to tick and tie.
And this, you know, best guess is, you know, that they're going to lose sleep over that.
That's yeah, I think that's our, it's true.
is like what your personal working style is and like where if you're comfortable with like, hey, I just want to know all the rules so that I can stay within it.
That's a perfect place.
Like, and it's needed.
It's super needed on the FP &A side, depending on what stage you're in right.
And there's certainly a point like where certain FP &A groups and larger companies, there still are a lot of rules and there are a lot of things knowable, but in the places where I've been, where it is high growth or smaller or new areas of business, like those things are most things are unknowable.
And if you're comfortable with that ambiguity, you're comfortable with an uncertainty and just going into sort of a greenfield, then yeah, the accounting stuff is just not the right thing for you.
So we, we could go on on that, but I do, I feel like it's interesting because I think maybe, maybe you're the third or fourth guest in a row that made that switch. So I've, I've probably already beat this horse to death, so we'll move on from it, but I do, you know, and I, I ask so much about that because early in my career, I kind of stumbled into finance.
Like I wasn't. Sure.
After my MBA that that's exactly where I was going to go.
I started out in marketing and then came over to finance, but we were talking before the show on and talking about those moves and you said something that really resonated with me because it reminded me of my early career.
It's great if you have a mentor and you have a team, and you have a coach and you're in an organization that has upward mobility and all that.
But sometimes I would say, and if you're not, you need to learn how to be this, but you're going to be the best advocate for yourself.
It's going to be, by one, quality of work you do, and two, making it clear what you're looking for.
And I think you and I shared that in common. And so watching your career progression in eight years at GoDaddy and now where you are, can you kind of walk us through if there's pivotal moments or really where being that advocate for yourself to get those new responsibilities, how can you sort of balance that with, you know, making what you want known but not sounding like you're whining or complaining or sounding too demanding.
Yeah, and what I always push my teams on, when they wanna grow in their careers is that growth is gonna be the intersection of opportunity and ability.
And sometimes you're like okay well ability I can control, but opportunity I can't.
And I would argue that's not true, opportunities can be manufactured.
There are certain things that I can't manufacture for my team, but most things if you say, hey, I'm interested in XYZ, we can find a way to help you get into that.
And that's as I look back on my career those were a lot of those things.
So when I first joined GoDaddy, I actually joined in the corporate finance department so doing travel and head count, all that typical staples.
But within three months of me joining, the team that was supporting our sales and support organization had gotten moved off, in large part because they had managed to run afoul of the entire team.
The business had come to the VP of finance and said, we just can't work with this group anymore.
All they do is tell us no, they don't seem to really understand the business very well, yada, yada, yada, we just need a change.
My boss looked around and was like, okay, Taylor you just got here.
You haven't really established yourself yet.
Why don't you like hold down the fort while I figure out what to do, there's opportunity, and then you, we need an opportunity to present something.
You have to run with it.
Right. And so what I did was say, okay, like this sounds more interesting to me.
Like I actually want to get embedded with the business.
I'm going to do everything that I can, that.
It's going to be silly to not choose me going forward. And when I think about all the steps in the career, it was similar points.
when I had supported the sales organization for a number of years.
I started to think to myself, Look, if I'm not careful, I will only ever be a sales and support guy.
And there's nothing wrong with that.
But my my aspirations were bigger.
And I worried that like, I don't want to be pigeon holed at this point in my career.
So I went to my boss and said, Hey, look, this is the thing that I'm worried about.
I don't want to move away from sales support.
I also don't want to lead everyone open and, you know, break the build, like what we built here.
But at the same time, to figure out how I get other opportunities in there so that I'm not just seen as this one thing.
And simply by advocating for it in that way where it's like, Hey, I'm not here to make your job harder.
But I'm also trying to figure out how to make sure that my job is fulfilled.
We're able to sort of manufacture little ones.
And then as opportunities came up, whether it was reorganizations or acquisitions, at least that seed was planted and I was able to get some of those things through and then you have to deliver right.
So those are the opportunities and then the ability if you can show that you could do those things, you have a record of being able to take on new things, then you suddenly are given more of those opportunities, right?
The reward for good work is more work.
So that's the stuff I think about constantly, and I try to carry through everywhere that I've gone.
Even today at Dashlane, I'm with my CFO. I have a number of conversations with him about, these are my aspirations, is what I want to do.
We may not be able to do all that stuff here, but how can I get exposed to different things?
Even just by asking that, he's like, ''You know what, let me get you in contact with a few other CFOs in my network and you can go talk to them and just pick their brains.'' I never would have gotten that opportunity if I didn't ask for it.
So I think the broad things to think about is, if you don't ask, you're not gonna get.
And then, as you're thinking about what you wanna do, think about what abilities you can build up while you're waiting for those opportunities to come through so that you're ready to take those on, right?
If you wanna be more of a business partner, how do you get more opportunities to speak in front of people and be able to give presentations, confidently, competently, whatever?
Hell, go to Toastmasters and practice speaking in public, if that's a thing that you're not great at.
If you want to be more on the analyst side, like bills and Tableau dashboards, go through some Excelsior whatever it is, right, you can do things in the background to show that you're capable and then just when the opportunities present themselves, throw yourself out there and ahead of those opportunities, make sure people know that that's what you're interested in.
Yeah, and I think about work, life balance a lot, and I think work life balance isn't like a period of Stasis where you just have everything perfectly balanced and I think what happens sometimes is like when you had the opportunity, if you wanted if if you wanted to have that stasis when you had the opportunity to run a team that had been broken up and you were gonna be the interim person there, you could have just ridden that and said, okay, well, I'll just do this.
Or you could have taken the opportunity and leaned in, put in the extra time and effort in that kind of a blast to make an impression there to get to move yourself up in there.
And I think that's a, you know it's easy to default.
And I think a lot of people my age, when you talk to them, you hear that they just get fixed in, this is the way I do it, this is the way I've always done it, I'm not trying to take on more.
These are the guys who were able to go ride their bike for two and a half hours at lunch. Sure, go to the park and all that, and that would be great if you're content where you are and you're not looking to move or change anything.
But right now with all the tech out there and I talk about it on every show, but with AI coming, if you have to work, if you're not living off of some trust fund, probably is now one of those times to shift to balance into learning more and understanding the new technology 100 % and like realistically, the people who are in that camper probably not listening to this podcast or reading my newsletter or doing anything else, right, like there.
But I think that's that's right.
I think the other thing that holds people back, and I'm gonna use the word promotion, promotion doesn't necessarily mean like higher title, it could be into a different role or whatever else.
But people tend to think about promotions as a reward for your past work.
And what I tried to convey to the teams that I have is no promotion is a that that saying you're going to be able to succeed at this next level.
So you can be phenomenal at your current job.
But if your boss doesn't think you're capable of doing this other thing, it's a risk for them to put you in that role, particularly when you're moving higher up in the ladder, right, like difference between analysts here analysts, I don't know, there's not a huge distinction between those.
But see, Rance the manager, absolutely manager, director 100%, right.
And so when you think about those things, it's like, look, you can be great at your job, but you actually have to show that you can go beyond that.
And that's where again, like that Looking for the opportunities to showcase what you're capable of and then delivering on it?
That's how you move up fast. The folks who are just going to say, Hey, I'm going to write it out.
I'm going to get the tenure and eventually I'm going to get to that spot those people do eventually get promoted, but it's typically not on the time scale that they're happy with.
Yeah. And this kind of goes back to, you know, what I was we're saying about buzzwords and everything before there.
You know, sometimes people going back to my LinkedIn thing, I don't know.
I've been on LinkedIn a lot this week, and maybe it's just top of mind for me, but I think sometimes people think that the way that they're going to be promoted or get that next job is to really with hyperbole and all the probably AI generated content now, go and just put all these thoughts, buzzwords and all on LinkedIn and you know, and exert that they are an expert.
They're a thought leader, an influencer, whatever when really, you know, the work has to be done.
If I'm a boss and I see someone on LinkedIn that much, I'm thinking, you sure have a lot of time to be posting on LinkedIn versus actually doing that, doing the job, but I mean, there's a fine line.
Like if you have communicating that and you know, bringing valuable information and not just adding to the noise.
And I think a big part of it though is taking that and applying it in the real world.
So thinking about everything that we talk about and what you talk about in the newsletter and what we try to talk about on this show, how do you apply this with your team?
So I guess maybe the easier way to, to word that would be, what principles are guiding you when you're creating and leading your teams to be high performance so that you can get them past the buzz words and get them to meaningful storytelling and all that.
How do you put these ideas in practice?
Yeah, so the first thing, let's define what high performing means.
At least how I think about it when I'm building these teams. And it is, we want to help the business make good decisions confidently.
And when we distill that we can work backwards and say, Now, what are the things that we have to have in place in order to enable that.
First and foremost, it comes down to who is on the team, who's on the bus, and what are their qualities.
The three things that I typically look for is I look for folks who are highly curious, folks who are highly ambitious, and folks who are service -oriented.
If you bring those three things to the table, you're able to wade through a lot of the ambiguity that comes with those decision -making processes, right?
Then when it comes to actually putting in principles of how do we make that team work.
First and foremost is we have to nail the basics, right?
We have to make sure that we're not.
Making a bunch of mistakes in the reporting that people are catching that undermines the trust. If you think about what trust is, trust is ultimately high quality delivered consistently.
So you want to make sure that the table stakes are there and they know, Hey, if the finance team has given me a number or they give me an analysis that has been well done, there's no formula errors, there's no issues of ticking and tying, et cetera.
That allows you then to build on that and say, alright, the things that we want to go do to be high performing is one, we want to have enough space for everyone to be able to step up and deliver for their business partners, whoever it is, right.
Whether it's directly with the business on a strategic finance role, or even from core prior finance and trying to guide the overall like executive team, I tend to run my teams a little bit on the leaner side one, because it gets people, those opportunities to stretch and they're not getting crowd out from, from things where they won't be able to do, um, but too, it forces them to think about the trade -offs that they need to make on a day to day, week to week basis.
Right? Because if you're not careful, your time gets filled up with a bunch of empty calories.
And so going back to what we were just discussing of like, you know, if you think about your own career and what you want to do to move up as a finance team, we want to move up is we want to be extremely outcome focused.
And so in any given week, we want to come into the week thinking, what are the things that I can do this week that will really help drive the business forward. Good examples of this is like, one, we're going to be really thoughtful about the types of reports that we're putting out and if we think it's not having an impact either because people aren't reading it or because they've become just straight up numb to it or it's missing a piece like we're gonna not be afraid to constantly edit, reevaluate, try different ways to make sure that we're breaking through the noise.
And then the last point which is just important with that service -oriented capability is be in the trenches with the business.
What I've noticed particularly with younger finance folks is they're much more comfortable behind the screen than they are on the phone or in the meeting room But you have so much more impact if you just talk to people.
I'm a huge believer in the written word clearly because I spent a lot of my time writing stuff out.
But that is good for knowledge transfer.
That's not great for partnership.
Partnership is give and take, it's having a conversation and seeing the body language.
I'm a firm believer that if you just spend some time talking to your business, understanding what they care about, you can have a huge impact with them.
Because one, you understand the business as well as they do, but two, they see you there and they know that you're in it with them versus you're just someone that swoops in and gives them a report and then swoops back out or swoops in and tells them, by the way, you're overspending or whatever else, right?
Like it is interpreted differently when it's someone who you feel like is on your team.
As you were going through it, you saw I was looking around for a pen to write it down because I didn't want to forget about it while you were talking.
But as you were going through the phases, I look at, so the foundation, talking about the basic skills, the analysis, you have to be blow that out of the water.
Just that's the table stakes though, that but we have to be able to build complex models, understand them, and create these valuable tools.
But then the ability, so analysis, then presentation of that, because if you have this just wall of data and numbers, but you can't tell a story around it, it's just too much information.
What's that quote by Clifford Stoll it's like, data is not information, information is not knowledge, knowledge is not wisdom, and wisdom is not understanding, but if you go back, like where we add value is moving what we're reporting higher up the chain, and truthfully, that lower level we're seeing with generative AI and with classical AI as well that automation in general, but the automation of turning data into information, that's not really adding any value, that's just running a report out of NetSuite that gives you your monthly, you know, performance to budget or whatever, but being able
to then select, even out of all the KPIs, Is what are the key KPIs to focus on here?
And what is the narrative here, the presentation?
And then I guess, I don't know if it would be a layer above or if these two are kinda tied, but the business partnering, that's strategy, that's understand, that's getting out of the ivory tower of financial and accounting and saying, no, I get it, I'm a part of this business and what I'm doing here, yes, I'm partnering with you, but we're all working together to come up with strategy to drive the business forward. And I'm thinking getting to that strategy point is the toughest part, especially because I think a lot of times FPNA people were like engineers, like you said, early career.
For me, thinking about could either, if I had my choice between spending all day in meetings or spending all day building a really cool spreadsheet, I think I'd pick the latter 99 times out of 100.
But you're on your career and I think what I've noticed is there's this arc where it's like early -new career, I just want to be in the room, I want to be in the meetings and then you get to a point where it's like, Oh my God, I'm sick of the meetings.
I just want to be in my spreadsheets.
Absolutely. But yeah, so it's your point of like, how do you, how do you foster that?
Um, one is we need to give folks perspective.
And so if you're one of those individuals who's like, I want to be a better partner, but I don't know how.
If part of the issue is that you are more often behind the screen, if you don't ask, you don't get, ask to be in the room for a couple of this, like hear how the executive team talks, or hear how the leaders above the leader you support, like, talk to them, what kinds of question they ask, what they're interested in, get that perspective.
That makes all the difference in the world.
The thing that I think about a lot, and like, whenever I take on a new team, I get one of these questions of like, Okay, well, how do we balance, you know, being a good partner, but we also have to hold everyone accountable?
Because they have targets and they have cost numbers.
And I said, That is absolutely the wrong question.
Because we, FP and A do not hold anybody accountable at best. In that world, we have the scoreboard. But we're not making the decisions about who is going to be reprimanded or who's going to be replaced or those are not our decisions, we're not holding anybody accountable.
Our job is to make the rules of the game and the placement on the field as clear as humanly possible, and then help guide them to move the ball further and further down.
And when you flip the script, it's like, my job isn't to tell them whether they're right or wrong, my job is to help them understand the context at which they're in.
And then how do I help them understand where they are and where they want to get to you and what the gap is between those two things.
And I found more times that when you frame it that way that helps start to open up a little bit.
I typically then kind of work through like a five stage, or not a five stage, but five different qualities of partnership, right?
So one is you want to have that aim to assist. You want to make sure that people are, you're going in there, my job is to make this team successful, to make this team look great.
My partner to blow the socks off of whoever their boss is.
Then you want to build clear boxes.
is to your point, like the models, the reports, everything has to be perfect.
But also, by the way, you want to make sure that everyone understands what's in those numbers.
Because again, if you want to make your partner successful, they need to understand how the business runs.
However, they think, if they're really detailed, give them more detail.
If they're really high level, help them intuitively grasp it so that you can actually partner with them because they have some base level knowledge of the things they're going to be talking about.
The third point then is you want to be able to just consistently close the loop.
One of the biggest things that I see with finance teams is they don't come back and give like the follow on right?
And the example that I typically use is, if you think about like the innovation of uber, it wasn't just you know, the the cars or the software or else, it was, I'm going to tell you when the car you ordered is going to arrive.
And if you think about that, like, hey, if someone asked for an analysis, or they asked for, you know, somebody to come through, are you telling them when to expect it, what it's going to look like?
And then by the way, if it's not, if it's going to be late, you're giving them a heads up, it's going to be late, here's a new deadline, right?
There is something powerful about letting people know what's coming.
Because when you don't, there's just more anxiety and more frustration.
Like imagine like calling an elevator and not having the little dial at the top that says what floor it's on.
So you're just sitting there being like, I don't know if the elevator is moving.
Like, I hear a sound but I don't know if that like it's stuck or whatever else.
You want to think about how does the team know exactly what you're working on and what to expect from you.
The last couple things then is going back to our point around not feeling accountable but you want to help them be successful.
The thing I preach consistently is, use yes and.
This is a super powerful, popular thing in improv comedy, right?
Where it's like, hey, to build on the scene, don't dissuade what the previous actor had done, build upon it.
Same thing with all this stuff, right?
Like, to avoid the opposite of no, don't tell them no, you want to agree with the premise of what they're driving and then add context on top of it, right?
So you know, simple example, If the sales team wants to have a spiff for an extra, you know, bonus on this thing or that, because they're worried about missing targets, they're like, yeah, that makes sense because it probably would help drive some incremental performance and I wonder about how that's going to impact our bottom line targets because we're already behind on this thing and that thing.
Right. You can bring the context in without shutting them down.
And that simple trick of agreeing and not, not falsely agreeing, like finding the actual good and what they're talking about and then adding the context on top of it, that's what a partnership looks like.
where it's like, I'm riffing with you, it's a good idea, and what else?
And then the last thing that you want to do is you just want to make sure, like we were talking before, is you want to reduce ambiguity where you can.
If we're thinking about the purpose of finance is to help make good decisions confidently, the thing that everyone gets stuck on is they don't know.
And if they don't know, they're not going to decide, they're going to ask for more data, more analysis, whatever else.
And so, what you want to do is help get them over the hump, that you're just gonna keep moving through the progression of information to knowledge, to insight, to whatever, and say, look, here's the things that we can know, here's the things that we don't know, but we can learn later on, and here's things that we will never know.
So let's figure out what configuration of these things, what level of confidence we have to have in order to move forward with this so that we keep moving because we have expectations, we have targets, we have a business to run.
I love all that, and it's funny.
I hung up on when you mentioned yes -and and that being a tactic from improv, I think.
So every now and then this happens, it's either serendipities or it's a glitch in the matrix, or I don't know what it is, but you're the third guest in, I don't know, the last five weeks to mention improv comedy.
Somebody brought it up as something about them in the segment where we asked, what's something not many people know?
They said they did improv comedy.
Someone else brought that up too.
I think that's so interesting though, that it would just come up three times.
But if you think about that idea of being a true helpful partner, yes and improv is because, if you at any point say no, Then you've killed the whole momentum of this of the sketch. So, you know, yes end and just thinking that mentality So I think the secret lesson for our listeners is go find your find an open mic night Find the improv comedy club in town and go take some improv comedy to get better at business.
I like I think that's right And that's a mention that also helps you with like the uncertain situations or when you get caught up because again like most finance people are not naturally comfortable in public settings and speaking or speaking out of turn or whatever else and like but that's where you have an impact that's where you build your brand is with the audience.
You don't build your brand with your spreadsheets.
Like to a certain point you do, but then you kind of teeter out.
And if your goal is to move up in the world and to be more strategic or be a leader, you need to look like a leader in those rooms. Yeah.
I mean, you know, if you're only focused on the technical part of your job, you're going to be the, you know, world's best individual contributor for the rest of your career or whenever.
Yeah, that's exactly right.
And that's okay. That's what you want to do.
But if you're, most folks that I coach, like they typically want to be in that leadership position.
It's like great you have to show up in the room.
Because if you if you look unconfident when you're talking people are gonna wonder well what else do they are they not confident.
There's something about like you actually take a lot based on how people present themselves.
And you apply that to how you think about their work.
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Feel like we could talk soft skills all day, but I do want to have the mix.
And because when you and I were talking before the show, and I get, we've been talking a while and we know we both share a lot of the same interests, especially on the data side, but I do, I want to get a little bit technical to the technical part of our job here where you talked about smart segmentation or when you were talking about how the most actionable insights come from segment data correctly.
While we're through that, tell me what great disaggregation looks like in practice and what do you mean by that?
Yeah. Before we jump into what it looks like, I want to give the example that helps paint the story.
It's one that I had in my post about it.
Back in the 1940s, the US Air Force had a problem where their planes were crashing a lot, way more than they should.
said, at the worst, there were like 17 crashes in one day, which is insane, especially when you're talking about like on the eve of America going into World War Two.
So what they did is they were looking at it and said, okay, well, maybe what the issue is, is that the cockpit because when the original cockpits were designed back in, I think, 1926, they had designed it for the average pilot then.
And they thought, well, maybe what happened is that our pilots are just a little bit bigger, or they're different size, and they're having trouble controlling their planes because of that.
So they went and did a huge study of 4 ,000 of their pilots on like 140 dimensions.
I mean, everything from not just height and weight, but also like the fun length the distance from your eye to your ear, just a bunch of crazy stuff.
And because they were like, we're going to fully develop what the pilot looks like in the Air Force and then the cockpit will be designed exactly around that and now they'll be able to control the planes.
And then there was one guy who was on this research group going, that doesn't make sense to me, and his name was Lieutenant Daniels and what he did is he said, look, something's not jiving with me.
So what I'm gonna do is I'm gonna take just 10, 10 of those 140, and I'm going to look at all those 4 ,000 pilots and I'm going to see how many of them fit within the confines of those average metrics for those 10.
So out of 4 ,000 pilots on those just 10 dimensions, exactly zero lined up with all of them.
So what they were finding was like, hey, these averages don't actually work because there's a bunch of different shapes and sizes.
And that opened it up because now they're going, Oh, well, what we actually need is not a pilot, a cockpit designed for the perfect pilot, we need a cockpit that can be designed for any So the advent of things like adjustable seats and steering columns and all this different stuff came from this one person who was looking at this and saying, I don't want to be confined by these average dimensions that you're throwing at me.
When you think about that, then, in how we run a business, we do this all the time.
Not just jumping to conclusions saying, oh, it must be because the pilots got bigger, which like in hindsight, does seem a little bit silly.
But on top of that, like we just, we use things like, okay, well, what's our average churn rate, what's our average contract value?
And then we tried to build on top of that, but that's not where the actionable things are, in large part because most of these companies when you're talking about these buckets, they're too big, and they're actually an amalgamation of a variety of different things, whether it's a bimodal distribution, where you have a bunch of stuff on one side, and a bunch of stuff on the other.
And so when I think about the segmentation, you have a couple of buckets that you can go through.
So one, there's just like the natural segmentation, things like, you know, geography, or if you are like a hybrid business, like we are dash line, you have B2C versus B2B.
But then you want to go a level deeper and think about from a customer lens, what are some defining features that help me break these things down?
And you can do that for just overall business metrics, and it's certainly helpful when you're trying to deliver on particular initiatives, right?
So like if you think about most, like both GoDaddy and Dashlane sort of a variety of business clients, if you were just looking at the average order size, you would think, oh, okay, well for GoDaddy it's a few hundred dollars or for Dashlane it's XML, right?
But reality is there's this big spreads, And if you think about it in terms of those buckets, you can start to design specific strategies that attract each. Or even better find opportunities in those segments that go, Oh, Hey look, normally our turn rate for, you know, customers of, uh, you know, this particular size or this particular contract value is X, but when I look at this group, it's Y.
And as you think about your role as a finance partner in FBA person, like, that's where you start to build your credibility and your brand where it's like, Hey, look, have we thought about this subgroup?
Because in all reality, most of those teams are looking at broad dashboards that aren't built for this.
They're looking at just the natural segments, but they're not looking at the actionable segments.
We put people into bands that make sense for us and it's not quite lazy analysis.
Maybe it's even more heuristics or if we're looking at churn and we divide our customers, we may do it by this is the industry they're in, this is the size they're in, this is the number of what their revenue is, this is how many employees they have, and we segment them that way.
but that may not be a natural segmentation.
And I think, and you know, I've been long been a proponent of machine learning and finance and granted, you have to have the right amount of data to make this work, but assuming you're at a big company with a lot of customers doing clustering with machine learning, don't you don't define the clusters.
You just find like entities and let the machine learnings figure out, okay, there's five different customers clusters here and we can't figure out what they are.
We run the model, but we see that they're, you know, they're segmented in a pretty interesting way.
that completely changes the way that we think about our customers, but maybe a lot better way to predict churn.
And I don't know what those features are.
You know, it's going to differ by company, but that is a different way to disaggregate and look at the data, let data guide you, I guess.
Yeah, and I'm going to say machine learning because that's actually an example that's present for me from the GoDaddy days.
So, one, like, I think when people get trapped, they try to operate on their reporting segments.
And reporting segments are really useful because it's a way for us to tell the broader business or tell the investors about how the business is doing.
It's natural. But that's not necessarily how you operate.
The operating segments are probably one or two clicks down below that are potentially a mix of it.
And so a good example at GoDaddy when I was supporting the sales and support team as we have departments, right?
So like, hey, if people are calling in about their hosting plan, as you go to the hosting department versus if they're calling their website publish for the website department, right.
Those all make sense.
But what we were finding, we were going through all this stuff was saying, Hey, look, you know, we're seeing weird things in like, the handle time, for example.
So like every call service rep is managed based on like how long each call lasts.
Some of these calls are getting a little bit longer.
And so some people were saying, Oh, what we need to do is we need to clamp down on this.
And we need to like get that back because it's going to ruin our efficiency, whatever else.
And we said, well, hold on a minute.
Let's figure out why that's happening.
There may be a product issue, there's something else, right?
And what we found was because GoDaddy was serving largely SMBs and, and like micro entrepreneurs is it doesn't make sense to have like a fully dedicated sales support department for each of these things, and so you have a lot of mix of calls coming in.
And sure enough there was there was this influx of support calls, but there's a lot of value in retention and handling those calls.
So what we needed to do was not think about them just in terms of departments, that's the reporting segmentation.
But now when you think about how those calls are being handled based on what the intent of the customer was, right?
Again, typically your operating segments are gonna be based on something with the customer.
And so we actually did have a machine learning model that would start to go through and sort of predict, is this customer calling in for support or for sales?
And then route it to different places within the department based on those features.
And you started to see some huge improvements.
Was like, okay, now I understand how we're managing this and we can think about things, not just in terms of the hosting department, but now, hosting department and a ratio of support calls versus sales calls and how are we performing on each of those?
There's a lot of cool stuff that happens when you just go, So you're willing to go one level beneath the surface.
Yeah, and it's, but you have to be, it's like you said, when you were building your team, you have to have the right, you have to be mentally curious and have the basic understanding of it and asking the questions.
You have to have that partnership thing because if you're just passively taking in the data and putting together your reports and not looking, you're not acting like an investigator, then you're never gonna uncover something like that because you're always just, here's our data, this is bundled up and repackaged it and send it out.
You have to talk to people.
Like that is the only way that you find these things.
For me, for a good part of my career when I was supporting the sales product, my desk was on the sales floor.
I was embedded within it because I wanted to be able to hear what was going on.
I wanted to be able to talk to the frontline managers from time -to -time, and it made sure that I stayed grounded in what was going on there.
I'm going back to our discussion about, how do you advocate for yourself.
That's one thing. Learn the business better than anybody else.
You're not stopped from talking to people.
And just having those conversations, whether it's a Zoom call or a happy hour or whatever and getting to know what's going on, you have perspective about the whole business that you're going to be able to apply to the anecdotes that you're hearing from individuals, and you're going to be able to draw connections that no one else has.
You know, Warren Buffett says that accounting is the language of business.
And I think as the CFOs have evolved, it's kind of interesting right now to see.
I think we're gonna see more CFOs moving into the CEO role because think about right now, if you're in FP &A you have, at most companies, most people I've talked to, this is the case, you're expected to be able to report with all the business partnering and everything, you could walk into any other division or department or geography in the company and get information.
Unlike imagine if your sales and you're trying to go into ops or HR trying to go into marketing and ask questions, It's you know, they're not going to have that level of insight in it's really, I think that the more embedded we become in these other groups, and the more, especially if you fashion your career to bounce around and understand holistically the whole picture, what a great opportunity to be exposed and learn all this.
And whereas maybe finance 20 years ago, you could have just stayed in this ivory tower of I'm just the bean counter.
And I just make sure that our numbers are right versus.
And so what do I care what the business actually does to now there's nobody thinking like that.
Yeah, I think that's right.
I mean, I think more and more you're seeing these like CFO plus roles, right, where it's like CFO, COO type thing, which is a natural extension then into a CEO role at times.
And, and I think it is that combination of, one, there's so much more data now that can help drive our financial models and how you think about the business and you can't be a consumer of that information without understanding the context around it.
And then also just the environment that we're in right now, where, look for a while, it was really easy to sell.
There was a lot of money out there and you could have a preponderance of software or whatever else, and it wasn't that big of a deal.
It's much harder to operate today than it was a few years ago.
And so I think more and more teams, executive teams, boards are looking for the finance team to weigh in on the decision -making to make sure that whatever is being done has the opportunity to scale.
Yeah and okay so that kind of leads me to my next question.
And I think we get that view and understand across the business.
And then, but we have to, again, we have to craft a story.
We have to take this in -depth, curious analysis that we did, and then turn it into this high -level narrative.
And we have to present it differently if you're talking to the board versus the line managers, but we need to be able to communicate with both of them.
I mean, how do you sort of balance that?
Yeah, so one, I think it is helpful to make sure, like to align how we talk about the business to whatever the broader strategic narrative of the businesses overall, right?
Um, especially when you're talking about going further down the line, where people maybe have less financial acumen or, or less exposure to it, you want to be able to tap into something that is familiar as you're telling the story so that they can go, okay, I sort of get where it's going, right?
So if the broader narrative of the business is, hey, we're going to grow and we're going to get to profitability.
Then the way that you talk about the business is going to be those two vectors.
Here's how we're doing on the growth side.
Here's how we're doing on the profitability side.
And then as you go and work your way down, I, I would argue the overarching story for each of those groups is going to be largely the same, and the detail underneath is going to be somewhat dependent on what kinds of questions that they ask.
One of the guiding principles I give to my team more often than not is start with less detail than you want to, because you can always follow up in the questioning with what those things are.
Certainly if it's a presentation, and then if it's an analysis, like, make sure the bottom line is up front.
Say, here is the conclusion, here's something I want you to know, and then here's a bunch of supporting materials.
I think it's counter to what our instincts are, which is, I did all of this work, I want to take you on the journey of my work, and here's how I built it, and here's the things that I got, and then you start at the end.
This is a Quentin Tarantino movie.
You're going to start at the end and then you're going to work your way backwards and time is just a construct.
But when you do that, it's easy to hold people's attention because no one's waiting for the so what.
I had this really phenomenal example where a business operations team was presenting to us about some analysis they did.
And they were just dragging it on.
And the whole time there was this giant whiteboard that was covered up with a piece of paper.
And we were like, we know there's something that you want to tell us behind that piece of paper, but they insisted that they had to walk us through the whole journey.
And I mean, for years, we would joke about the grand reveal where they eventually told it off and we're like, why didn't we start with that?
Because now we have questions and this whole time we're wondering about it.
So if you think about that principle of like, no grand reveal, start with what you're able to know.
And then what you'll be able to know how it's dependent on like what where they sit in the organization.
So for the frontline team, it may just be, hey, your perspective on how we're doing as a business versus our goals.
And for the leadership of the team, and maybe here's how we're doing, and here are the opportunities for us to go get back on track, or opportunities for us to get even further above those numbers.
And you can start to build the story based on that that core finding of here's what we're trying to accomplish as a business.
Here's the status. Now what?
Yeah, I love that. And I kind of wish somebody had given me that advice before my first CFO role.
I was not used to speaking to boards.
And because I've worked with a bunch of engineers when I was in telcom before that, I think back in those meetings, and they had to have been brutal and it just, because it's a bunch of engineers talking to each other and then you throw a couple of finance guys in the mix too.
And it was, um, but where it's all we did was just, you know, wall of numbers in, in talk through everything we did.
And then people would pick it apart.
But my first, where I had to have quarterly board meetings and I'd go and report on the financial state of the business, I would always want to do that and just show, look, look at how, look at everything we know because we were very, very small company then.
And, but I wanted to show how good we were and how we knew everything about all of our locations.
And, but there was this one board member who, no matter how much detail I gave him would always drive questions that were two levels deeper.
So one, it was too much information upfront took way too long to give, to tell the story.
And two, it set me up every quarter until, maybe after a couple of quarters, I figured it out.
But wait, let me just present the tip of the iceberg and I'm going to have all this down here if he asked for it, but he's going to ask some deeper level anyway.
I'm not giving any more value other than trying to make myself look smarter and my team look like, you know, we have it together when really, if you get to the so what, then we can save a lot of time.
One of the best advice I ever got was someone told me, imagine that the first slide is the only slide you get.
What do you want to say?
And like that that clarity really forced it because like, okay, based on even if it's like a monthly review, what are the things that you want that team to know.
And it can't be like a next card for an open book test that you had back in high school where you're trying to fill in every line, whatever.
Right. Like, the slide has to be pretty and readable and all that.
But it forces you to still what is the core thing that we need people to know.
And then it becomes a lot easier to fill in the blank underneath that slide and say, OK, well, if someone asked about this, what are they going to ask?
and you can sort of build the story in reverse.
I think I'm over time turning FP &A today into one of those four -hour podcasts like Rogan or Lex Priton, or something.
There's no bongs on set here or anything, but it's like, I don't know, it's funny, they keep reminding me, we're trying to keep this to 40 minutes, that's the ideal time for a podcast. Well, maybe I'll get through the intro in 40 minutes.
But before we go, I mean there's the canned questions that kind of the standard we ask everybody, but there's one that I really want to get to because I think your insights and your experience and you speak with great clarity on this and it's obvious that it's a passion for you.
I do want to talk about your newsletter.
So for our audience, tell them about your newsletter, kind of what inspired you to start it and what kind of topics you cover with it.
Yeah, so the newsletter is CFOframeworks at cfoframeworks .com.
And really the impetus was a lot of stuff that we've been talking about, which is, I thought about, not just my own career, but also the folks that I was leading and mentoring and coaching.
The technical aspect of it largely was there, but a lot of these soft skills or these ancillary skills that we're talking about were things that people had to learn on the job.
And depending on your opportunities, you may not have gotten it.
And so what I wanted to do was say, all right, let's broaden this out and talk about things about how to be effective in the finance role beyond just the basic blocking and tackling that's required.
And so I use the acronym frame because I think about it in terms of those five buckets.
So there's focus, there's relationships, there's analysis, there's messaging and there's execution.
And so I try every week and it's getting harder to do it weekly, to be honest with you, but to create a post around one of those ideas to kind of help build it out.
And the intention ultimately is not just to help coach people but also just help me clarify my thinking because as I find, as I get higher up in the leadership positions, it's harder to distill this information for my team with the time that I have. So this is a way for me to think about, alright, what's the core insights that I want to deliver?
I'll write it down for myself it becomes much easier to repeat it as I go along.
And, you know, added benefit if my team or anyone else actually reads it.
But for me, it's just a way to clarify my thinking and get thoughtful about, like, what is the core thing that helps this job get a little bit easier.
Yeah, and I love the newsletter and one of the first ones...
and just to give our audience a flavor of it...
one of the first ones that really jumped out to me...
I mentioned it to you when we talked before...
is the Montoya Matrix from The Princess Bride.
So, tell us about the Montoya Matrix.
Yeah, so, you know, it's one of those things where...
I'm sure we've all experienced this where we hear words and then down the line, it turns out that there, there was a misinterpretation where someone thought it was one thing and it was another thing.
And that's what we may think of, of the princess bride, where a nogomotane is like, you keep using that word. I don't think, you know what it means.
And you know, like really good example that I've seen a lot in the finance side is the word incremental, right?
Hey, this is going to be incremental revenue for us.
But then when you dig into it, like, well, is it incremental for this division or for like, is it incremental new?
but maybe it eats into our existing bay or, or like less expansion down the line.
Like what does incremental actually mean to you?
And when you, when you go and you try to define words that you think, you know what they mean and you actually find out what people are interpreting as, you can save yourself so much headache down the line by getting really crisp on those things.
And so I built this in this Montoya matrix to, to try and segment the words that we use every day between the axis of impact.
Right? So like what sort of impact could a misunderstanding on the words mean?
You know, high versus low.
and then also if you think about like the level of alignment that's required so like does everyone understand what it means or does everyone think they do but not quite so much the intention is not to like be pedantic and and try to get like every single word defined but it's to be on the lookout for things where it's like someone says something and it seems important and you're like well I interpret it this way but I actually could see where it's interpreted somewhere else and in the post I gave an example there was this HBR article about this same phenomenon and had this infographic where they
did a survey on all of these really general words, words like always, never, sometimes, and then they said what does like put a probability percentage on this and what does it mean to you and then they drew all the curves and it's mind -boggling that at least to me where like words like always could be below 100 or words like never could be above zero or sometimes could be anywhere from 25 to 75 percent but like if you think about how often those things come up where it's like, I know what that means, but I know what I mean when I use it, but it's actually not a defined term.
If you start to be more methodical about those things, incremental, even the difference between a forecast and a budget or a latest estimate, what do those things mean?
It becomes so much easier to operate because we're all truly using the same language versus words that we think we know what they mean, but we don't.
That's funny, because now I'm picturing like you've got a couple of documents, you've got your data dictionary and then your just glossary of words that we use at this company.
that's right, but you know the great thing about it though is like once you start doing this, it - it teaches other people to do it, and everyone's much more careful once they like once someone gets exposed to this idea, they become more familiar with it, and then you don't have this problem anymore.
So it's - it's one of those things that regardless of your level in the organization, you can have a huge impact simply by reducing the like, going back to what I say, eliminating ambiguity is one of the partnership skills.
That's an easy way to eliminate some ambiguity and save a ton of pain down the line.
But just being really clear as to what things mean.
Love the newsletter, I definitely understand trying to keep up with that while you have a busy day job, but keep cranking out the content.
We'll put a link to it in the show notes too.
I guess to try to stick the landing here and not keep us on for more than four hours, let you get back to your day job.
Let's wrap it up with the last couple of questions that we ask everybody.
First off, what is something that not many people know about you.
So a lot of people don't know that actually, when I went to college, I was going to be a psychologist. So I was a psychology major, I was going to be a therapist of sorts.
Like I was, I was, I've always been interested in how people make decisions and I wanted to make better decisions.
And then I had this epiphany in my sophomore year.
I was like, Oh no, I don't have the mental fortitude to deal with everyone's problems on a daily basis.
And so then I kind of flipped and went to business, although I'm still dealing with everyone's problems on a daily business is just probably a little bit lower stakes.
But I think once folks learn that about me, they go, oh, I can see where you had that brain or you have some of those terminology that permeates through however you talk about things.
Did you end up as you were shifting away from it, did you ever hover on IO on industrial organizational psychology before you decided to leave it?
I thought about it.
I had it on there, and the great thing about the coursework, is you got to do a bunch of different things like sports psychology and like clinical and children's and all this stuff and I and I did love the organizational aspect, but then I kept going back to it like well, like, you know, I was a little bit prescient, but I was coming up on the 2008 crisis when I was graduating and would have been really hard. So I think I think the the accountant part of my brain, the conservative part was like, you know what you should probably find something where you for sure will have a job.
And then you can figure out how to get into the things that you're interested in.
And I've been very fortunate that going back to our thing with like manufacturing the opportunities getting into the stuff that I like to do.
And all I had to do was do accounting for a while.
Yep. All right. So now everyone's favorite question.
What is your favorite Excel function and why?
Ah, there's there's so many.
I am a huge user of index match, especially when we're thinking about like the amount of like data points that we're pulling from different dashboards and different things and trying to bring it all together and go into our point around segmentation.
I'm going to categorize things my own way.
And there's just something so like, hey, you have your tab of various tables for index match and you just run it through and then like, oh, you know what?
I actually want to segment it differently into it this way.
Way better than you know how I used to do was either God forbid nested if statements or a V look up.
It slows it down like hell yeah, God, that's to see.
I'm dating myself, but nested ifs and V look up.
That's where I made my money back in the day.
We used to have a rule on my team at GoDaddy where was if you had more than I think it's like two or three if statements in one I was going to delete it.
So you had to go, you had to find another way to make it work, but we were not going to have like 15 nested if statements.
There was always going to be a break.
Well, Taylor really appreciated you coming on the show.
I guess one more thing before I let you go.
How can our listeners connect with you and your newsletter?
Yeah, so to me I'm on LinkedIn, so you can find me under my name, Taylor Otzdott, and then the newsletter, CFOframeworks .com and I think I have my contact information on there as well, but please go, peruse, subscribe.
And then if there's anything that I can ever do for someone in the community, just let me know.
Taylor, thanks so much. Gwen, my pleasure.
Thanks for having me.
