📬 Come together: To centralize FP&A (or not)?

Every month, the same file. Change the date, pull the processor exports, rebuild the formulas, discover that processor B still will not reconcile against NetSuite.

Faye's team lived three weeks of that every close. Now Accounting Agents prepare the work before anyone opens the task:

[See how Faye's team got 15 days a month back]

P.S It's worth seeing what your close looks like when the preparation is already done.

💡 Need a hand solving a tricky CFO problem? Send me your questions, and you might just see yourself in next week’s Mailbag. Submit anonymously using the button below:

Here’s what’s on the menu:

Now, let’s get into it.

Sussex CFO from UK

I recently started as FP&A lead at a new multi-national organisation. While it is a global business selling similar products to similar customers with hundreds of millions in total revenue, it is also a collection of local businesses. There’s highly local management, separate ERPs feeding a consol system, deep data that is inconsistent, unavailable, or unreliable, and hardly any collaboration between sites.

Even before your latest Playbook, I was determined that my new FP&A function needs to directly improve the financial performance.

I am struggling with how to do that. It is effectively not a few large global businesses but is, in reality, ~15 local businesses. My small, fledgling team and I can’t properly business partner with 15 businesses. 

Each site has a FD of some kind I can obviously lean on. But there’s a high variety in the businesses and their issues. Getting this new, global team to add real value to such disparate issues seems mind boggling to me.

How would you approach it?

Thanks for the question, Sussex CFO. Super interesting situation.

I’m glad my Playbook on the role of FP&A inspired you to think about this.

In the long run, there is obviously an argument for harmonizing systems, processes, definitions, and data. That would improve visibility and decision-making. But from what you describe, you are a million miles away from that. So it is not a helpful observation.

Even if you had the resources, I would be careful about centralizing too much, too quickly. You are dealing with highly decentralized management across multiple countries, separate ERPs, inconsistent data, and local teams who probably have very different ways of making money. The risk of missing important local context is huge, especially with a small fledgling team.

So no, you cannot “business partner” 15 local businesses properly from the center. Not in any meaningful way. If you try, you will spread yourself thin, annoy everyone, and end up producing lots of central noise with very little local impact.

I would focus on two things.

First, get the bones of a basic planning cycle in place. Long-range plan and budget. Keep it simple, but create a standard frame. Not a giant corporate planning monster. Just enough consistency so you can understand how each local business sees the next few years, how the annual budget hangs together, and how those plans aggregate into the total group picture.

That gives you a common measurement system. Without that, every monthly result will just be a local story told in the local dialect.

Second, you need to understand how and where each business makes money.

That probably means a simple product, customer, channel, or site profitability exercise. The exact cut depends on the business model. But the goal is the same regardless: find out where the contribution margin and overhead is really coming from, where it is leaking, and what each local business thinks its economic engine actually is.

I would not template this too aggressively at the start. Set the framework centrally, but let the local teams do the work with their FDs.

This kind of work always surfaces something surprising. Especially in businesses that are not used to looking at profitability properly.

So I would set a central framework, then have your team man-mark a manageable number of sites. Three, five, seven, whatever your team can properly handle. Work through them in waves. It does not all need to happen concurrently.

You will hear complaints about resources from the local teams, but if they don’t understand how and where their business makes money, they really should…

Once you have a simple planning frame and a better view of how each business makes money, the answer to your bigger question will start to emerge.

You will see which sites need help with pricing. Which have margin leakage. Which have working capital issues. Which have poor forecasting. Which have customer profitability problems. Which are running a decent business but reporting it badly. And which just need to be left alone.

You can then target your support in a much more focused way.

TLDR: Don’t centralize the noise. Build a simple planning frame, learn where profit really comes from, then target the leaks.

IA from Dubai

Hi Secret CFO,

I have recently joined a large family-owned business as Finance Director. The business is currently struggling, but has strong support from the family owners.

Within my first week, the Managing Director pulled me aside and asked me to take over the IT department as well. He said he does not trust the current Head of IT, and wants me to lead the team and make any structural changes required.

How would you approach this situation?

Thanks for the question, IA.

It sounds like your MD wants the Head of IT removed, and does not want to do it himself.

That may or may not be true. But it is the first thing I would test, because if that is the real issue, it should not be driving org design.

I would start by surfacing it directly, but carefully. Remember, this is your first week. You do not yet have the trust, context, or political capital to start kicking doors open.

I would pull the MD to one side and say something like:

“On the IT reporting line, I just want to make sure we are solving the right problem. Is the view that IT should structurally report into finance? Or is the real issue that we have a performance or trust problem with the current Head of IT? I don’t want us to confuse an org design question with an individual performance question.”

If he says he genuinely believes IT should sit under finance, then ask the next question: what is IT not delivering today that he expects finance leadership to fix?

That will tell you a lot.

Is this about cost control? Systems reliability? ERP delivery? Cyber risk? Governance? Bad project discipline? Poor service levels? Lack of commercial grip? Or just general frustration with the current person?

Those are all very different problems, and once you know what the problem is you can assess how qualified you are to solve it.

Ultimately, I probably would not resist the change too hard. In many businesses, especially family-owned businesses, IT and finance can sit closely together because systems, controls, data, reporting, and process discipline are so intertwined.

But I would want to establish a clear mandate; specifically what is expected from IT in the first 3 months, 12 months and 3 years. And what authority and resources you have to solve those problems.

Then I would run a short diagnostic. Meet the IT team. Understand the systems estate. Review key risks. Look at open projects, contracts, cyber, ERP, reporting pain points, and the relationship between IT and the business. Then come back with a practical plan. You can do that under cover of ‘being new’ without having to put the new Head of IT’s nose out.

And if the MD says, “No, finance is not really the right long-term home, I just do not trust the current guy/gal” then fine. Help him solve that problem properly. Offer to support the transition, define the role, assess the team, and help him find a successor without necessarily having to take on the reporting line.

This could be a great opportunity to build trust quickly and get closer to the machinery of the business. But only if you clarify the real problem first.

TLDR: Don’t confuse a people problem with a structure problem. Clarify the mandate, then use the moment to build trust with your new boss

Miko from Poland

How important is benchmarking in terms of financial performance, how does it influence your thinking? Do you look at market share more often than once per quarter or year?

Hi Miko,

This is highly business specific.

If you are in retail, or branded consumer goods, you may look at market share every week, and with a reasonable degree of accuracy too. There are plenty of paid data services that you whether you are winning or losing on rolling week, 4-week, 13-week and 52-week basis.

In those kind of highly competitive, data-rich, consumer-facing businesses, being close to the market is survival critical.

If you are in a rapidly growing early-stage business, is market share that important? Usually not. As long as you have picked the right total addressable market to attack, the bigger questions are product-market fit, customer traction, retention, unit economics, and whether you are moving fast enough in the right direction.

So on market share, the answer is: it depends on if market share is a live operating signal in your business.

Benchmarking more broadly is important in certain contexts. But I have a slightly allergic reaction to it.

The problem with benchmarking is that it can promote corporate homogeneity. Everyone does the thing because everyone else is doing the thing. Then everyone drifts toward the median answer, which creates a nice little self-fulfilling loop where the benchmark becomes true because everyone worships the benchmark.

Consultants have a lot to answer for here.

They collect data through engagements, package it up as insight, then tour it around the industry to win more work. Which gives them more data. Which gives them more insight. Which gives them more work. And round we go.

They usually know what the answer will be before the work even starts. It is not quite changing the logo at the top of the deck, but it is not always far off.

That does not mean benchmarking is worthless. It just means it needs to be treated with caution.

Anything really good in business usually comes from doing something better, sharper, cheaper, faster, or differently from everyone else. My favorite strategy books tend to orbit that idea. Blue Ocean Strategy talks about finding markets without direct competition. Zero to One makes a similar point in a different way, pushing the value of building something to monopolize a market, even if the market is small to start with.

Benchmarking can pull you in the opposite direction.

It tells you what everyone else is doing. That can be useful, but it rarely tells you what you should do differently.

So yes, benchmarking has a place. Use it to understand the game. Use it to spot obvious underperformance. Use it to challenge lazy internal assumptions. But do not let it become strategy.

TLDR: Benchmarking is useful context, not strategy. Use it to spot gaps, not to become everyone else.

A few of the biggest stories that CFO’s should pay attention to. This is also the section you might not want to see your name in.

Amazon finds out AI has no budget line, just…vibes 

It’s a real problem when a simple project to match author names to listings runs 860% over budget, to the tune of $1.8 million… and the deployment fails. But this is the kind of expensive AI f*#k up that I expect we will be hearing a lot more about in the near future.

AI spend is going to need a control system businesses don’t really have yet.

Whataburger 86s its growth-era CFO and orders in a Taco Bell vet

Ryan Moore, the new CFO at Whataburger, will have his hands full trying to grow a fast food chain into a market in which consumers are starting to pull back. Tough sector.

PE’s favorite accounting rollup just got $5b bigger

Grant Thornton’s acquisition of CBIZ is a big deal. The biggest firm outside the Big 4 just got bigger….

As PE continues its spending spree on mid-market accounting firms, you have to assume it’s only a matter of time before a mutant firm is formed that makes the Big 4 the Big 5 (again).

ICYMI, here are some of my favorite finance/business social media posts from this week.

Let me know what you thought of today’s Mailbag. Just hit reply… I read every message.

Last weekend, we announced the start of a very special guest Playbook series on the business of football (soccer), specifically Manchester United.

And last week’s Boardroom Brief looks at how and why they Big Four are cozying up to the frontier AI models.

Disclaimer: I am not your accountant, tax advisor, lawyer, CFO, director, or friend. Well, maybe I’m your friend, but I am not any of those other things. Everything I publish represents my opinions only, not advice. Running the finances for a company is serious business, and you should take the proper advice you need