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At the German technology company Lucanet, the relationship between finance and leadership is crucial. While this relationship’s importance can be justified in nearly all organizations, how this company has developed its systems is uniquely CFO-influenced. Under the leadership of former CFO turned CEO Elias Apel and vice president of finance Carsten Gerger, the two have developed a strategic relationship that has become a core foundation of the business.
While Apel is based in Munch, Germany, Gerger is based in Berlin, a span of about 350 miles. Though the two continue to meet formally monthly, they operate in different realms of influence within the organization daily. While Gerger has continued to develop the finance function efficiency through much of its own technology, Apel has transitioned into a role where he now has taken the same initiative he took to the finance function as the CFO and has driven it across the organization.
For a finance leader who is working for a former CFO turned CEO, there can be a challenge around autonomy. Gerger said he feels like his ability to autonomously lead his responsibilities of the finance function is not impacted by Apel’s CFO experience. To the contrary, he said some of the most important parts of his job are the in-person meet-ups he and Apel have on a semi-regular basis.
“I think it is essential that me and [Apel] meet in person because in the end, it’s about personal connection between finance and [the CEO],” said Gerger. “I have built out a lot of our finance function’s ability on the technical side of things, and sometimes I need the awareness of other people, especially someone like [Apel], to make sure there are no blind spots and I am getting everything done and keeping everything running.”
Gerger also added that his working relationship with Apel and its development over time has made him much more comfortable in addressing things like risk and strategic decision-making. “It’s been really helpful to have the perspective of a former CFO when I bring up a different view on something,” said Gerger. “If I am thinking about risk a certain way, [Apel] is able to provide insight from a financial perspective but from a different point of view within the organization.”
One of the most important parts of their relationship, Gerger says, is their ability to candidly disagree and address things pragmatically. Through their aforementioned different viewpoints of the business, the two can have meaningful conversations about direction that allows Gerger to provide strategic insight and Apel the opportunity to get that insight from someone who speaks the language of finance.
“At our organization, the finance-CEO relationship is all about evolving the way we work at the same pace as the organization is evolving,” Gerger said. “We are looking at the same datasets, building one story about that data and coming to a shared understanding that we can then take action from. But when it comes to investing decisions in technology or M&A, the angles he and I are able to analyze from have helped me feel more connected to the greater parts of the business when we can take important decisions at eye-level and use clear communication.”
For Apel, his focus on transitioning the company out of the solely founder-led model was his primary function during his time as CFO. He knows first hand the “scarcity” of financial talent and has used a strategy based on granting autonomy to keep strong talent like Gerger around.
“There is definitely scarcity in the assets of financial talent,” said Apel. “As a CEO, I need to be in the top 5%, maybe 10% of the business because what I’ve learned is I can’t be the best at everything. There are experts within this organization that understand things better than me, and I need them for the business to be successful.”
Apel credited his CFO experience for his ability to be successful as a CEO, as he can articulate culture, strategy, marketing and finance when needed. “I believe I am able to participate in every conversation throughout the business, but it’s my CFO experience that has allowed me to have a specific edge and give instruction that can help address certain challenges.”
Scaling, he says, is important for the business as a whole so that the leadership team doesn’t get overwhelmed with work as the company grows. If leadership gets overwhelmed during growth stages, Apel says they will leave, which he views as an avoidable cost. He says a major part of his job has been to create an environment where systems are scalable and leaders have autonomy and decision-making influence.
“As CEO, I learned that if I wanted to have a successful relationship with finance, I had to create the environment that allowed for that. I’ve worked hard on creating an environment where our team can grow, and although it’s a fast-paced business, I think [Gerger] and I have been able to keep each other aware of the things that we need to in detail, and he has become a strong finance business partner with me on this journey.”
He said that although both his career and the company have gone through many changes since he became CEO, Apel believes Gerger’s influence deserves a significant portion of the credit.
“I’ve always needed a strong finance business partner on this journey,” Apel said. “But I believe that it’s on the CEO to create that environment that can help finance thrive to its highest potential.”
This is part two of a two-part series. Part one can be found here. The entire series can be found here.
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