Making the most of data and information: Insights from Experian’s CFO

In this podcast, Heidrick & Struggles’ Susie Clements speaks with Lloyd Pitchford, CFO and board member of Experian, the multinational consumer credit reporting company. Pitchford shares his experience on how digital disruption is causing a shift in finance responsibilities, moving beyond workflow automation to supporting technology, data, and innovation to create competitive advantage. He further emphasizes the importance of focusing on external factors to ensure long-term success in a fast-paced environment.

Some questions answered in this episode include the following:

• (1:05) In your opinion, what are the key leadership skills a modern CFO should have?
• (2:22) How is technology influencing the modern CFO leadership development?
• (3:47) As new technologies change both the day-to-day work of the finance function and the competitive landscape, what should CFOs do to stay ahead of the curve?
• (6:48) Thinking about the continuous changes that new technologies and digital innovation are bringing, how can CFOs help their companies disrupt rather than be disrupted?
• (8:20) What are the main challenges of implementing new technologies, and how do you avoid them?

Below is a full transcript of the episode, which has been edited for clarity.

Welcome to the Heidrick & Struggles Leadership Podcast, the premier provider of leadership consulting, culture shaping, and senior-level executive search services. Every day, we’re privileged to talk with fascinating people who are shaping the future through their leadership and vision. In each episode, you’ll hear a different perspective from thought leaders and innovators. Thanks for listening to the Heidrick & Struggles Leadership Podcast.

Susie Clements: Hello, I’m Susie Clements, a partner in Heidrick & Struggles’ London office and co-managing partner of the Global Financial Officers Practice. In today’s podcast, I’m speaking to Lloyd Pitchford, CFO and board member of Experian, the multinational consumer credit reporting company. Lloyd is also a non-executive director and chairs the audit committee of Bunzl plc. Lloyd, welcome, and thank you for taking the time to speak with us today.

Lloyd Pitchford: Thank you, Susie.

Susie Clements: Lloyd, the digital revolution is having a tremendous effect both on businesses and on the next generation of leaders, including CFOs. In your opinion, what are the key leadership skills a modern CFO should have?

Lloyd Pitchford: I think the data and information revolution is having a really profound effect on all companies. It’s both creating and destroying businesses and business models with just an increased pace, and that means companies have to do two things. One, they need to really understand what’s happening in their external environment and then create a process by which they can innovate and respond more quickly. And an external focus is key to that, understanding what’s happening in your markets. But also technology is more critical than ever.

Susie Clements: How have your responsibilities broadened beyond pure finance workflow automation?

Lloyd Pitchford: At Experian, we’re in many different markets globally, not just geographic markets, but we do lots of different things in the data and information space. So the involvement in the innovation process, how we invest in early start-up companies through our venture funds, the M&A programs that we have, the change and technology development programs in the company, all of them ultimately, in one way or another, require investment and therefore come in to me, so my role is very broad.

Susie Clements: How is technology influencing the modern CFO leadership development?

Lloyd Pitchford: The way to think about that is that businesses thrive through creating competitive advantage. More than ever before, technology, data, and innovation coming together is how companies are increasingly creating competitive advantage. If you look back, we’ve gone through different stages of development of people leverage into systems and machinery leverage; we’re now in the world of data and technology leverage. So if you don’t really understand how data and technology is impacting your competitive advantage as a company, it’s hard to survive and thrive. So that’s really where competitive advantage in the modern economy is built.

Susie Clements: Can you think of some examples to share with us on that?

Lloyd Pitchford: You can look back just at the number of companies that were really mainstays of the global industry and how their business models have just been destroyed by technology. Kodak is a really good example. We’ve seen Blackberry, Nokia, companies that were market leaders—technology moves past them quite quickly. And this is why innovation is really key, because innovation is a proxy for your ability to be able to respond quickly and change your business model in a world where the pace of change is increasing.

Susie Clements: As new technologies change both the day-to-day work of the finance function and the competitive landscape, what should CFOs do to stay ahead of the curve?

Lloyd Pitchford: A couple of different things. I think the first is having an external focus. Quite often when you’re involved in the management and leadership of a company, particularly in the finance area where there’s a lot of focus on internal processes, it’s very easy to be drawn to that, but ultimately, it’s the external market and your position within it that determines your long-term success. So keeping an external focus is key.

I think really deeply understanding performance in that external context is the second. We have this phrase at Experian of trying to get to the truth of performance, and the truth of performance is a really difficult thing. If you’re growing 10%, that sounds good. If you are in a market that’s growing 20%, 10% doesn’t sound too good. If you’re in a market that’s growing 20%, but your main competitor is growing 5%, that sounds better. What is the truth of performance? And that requires a really deep understanding of not just your internal performance but also your position in your markets.

Susie Clements: And how do you get to that by looking at the external market?

Lloyd Pitchford: Lots and lots of data, integrating lots of different data points, continuously scanning for new pieces of data that tell you that perhaps your market’s shifted, being ever driven to make sure that you’re not complacent about your position in a market. Just when you feel great is often the time when your market is just about to shift.

Susie Clements: How are you innovating in the finance team at Experian?

Lloyd Pitchford: Experian obviously is a leading data and technology company, so that gives us a lot of advantages in how we can use and manage data within the finance function. So we have been very focused on data management, data governance, in the finance function. We have data management teams of data scientists within the finance function, governing data so that we can transmit data between all of the different functional systems in an easy way and making data do the work for us rather than having to bring it together manually.

So one our projects over the last two years, for example, is fully integrating our data between our CRM [customer relationship management] system, our sales reporting system, and our ERP [enterprise resource planning] system to allow automatic forecasting. That’s been a big drive across the company, which is no mean feat when you think about a company in more than 40 countries globally.

Susie Clements: And how has that been working?

Lloyd Pitchford: It’s a work in progress, as all these things are. There are some good things that are coming from it, but there’s a lot more still to do.

Susie Clements: So Lloyd, thinking about the continuous changes that new technologies and digital innovation are bringing, how can CFOs help their companies disrupt rather than be disrupted?

Lloyd Pitchford: I think that comes from seeing the bigger picture. As a CFO, you’re in a very unique position in a company to be able to tie all the different information threads together and see not just how you’re performing but also perhaps why you’re performing in that way, which often can be some of the external changes that I talked about, whether it be technology or industry or market forces. That’s key; that up-to-date understanding of where you are is critical to be able to then plot your next move. So using that positional advantage in the company to be able to tie all the information together and the insight that comes from it.

Susie Clements: A recent McKinsey study shows that, in this moment in time, CFOs have, more than ever before, the opportunity to act as a leading change agent within their companies. Do you agree with that statement?

Lloyd Pitchford: Yes, I do, principally because of just how much data there is to have to integrate to understand where a company is, and that is changing the role of the CFO; it’s changing the understanding of what performance is, and the CFO’s role is really at the heart of that.

Susie Clements: What are the main challenges of implementing new technologies, and how do you avoid them?

Lloyd Pitchford: Most large organizations run some form of matrix, and there’s no right answer to how you organize yourself as a company, but the interfaces between the different pieces of the business are often the trickiest thing. To be able to make the most of data and information, as we do here at Experian, you have to be able to integrate data across the different parts of your organization, and that requires, more often than not, doing things in a common way, structuring your data hierarchies similarly, and having a common tool to be able to integrate the data.

And the best tool I think you have is lots of changes but all pointing in the same direction—that is a more powerful tool than trying to make a small number of big changes. It’s less likely for something to go wrong. It’s much more agile, and you can make changes as you go. And you’re much more likely to get buy-in and less resistance from your colleagues in a company. That’s probably the best change management technique that I’ve found over my career.

Susie Clements: In your experience, what technology is the most valuable for finance, and how is it best utilized?

Lloyd Pitchford: I think the thing that adds most value in a financial organization is, ultimately, the intellect and leadership of the finance team. That is not a technology, but it’s the most important thing that you leverage.

But in terms of most recent technology, the ability for data to be portable. It used to be if you had multiple systems, you had to integrate them with hard-coded pipes. With the introduction of modern technology around API [application programming interface] layers and how you can draw data together, it makes it portable in a way that it hasn’t been, and at a much lower cost and cost of change than seen before, and that really is transforming how the different enterprise systems get tied together. So that’s probably a very recent technology that I think will transform finance. And I think in these next few years, it has the potential to be as transformative as the introduction of the spreadsheet or the ERP system, when you think about how the role of finance will change.

Susie Clements: If you were to give one piece of advice to future leaders about what they most need to do today to thrive, what would that be?

Lloyd Pitchford: I think in the early stages of your career, you pick up both skills and experience, but the skills are the most important thing, and you pick up skills when you are out of your comfort zone. So my advice to members of the team here at Experian is always to throw yourself into situations and roles that are constantly out of your comfort zone. That’s how you’ll grow as an individual. And what you find later on in your career is it’s that bedrock of experience that you fall back on and rely on because you’re out of your comfort zone most of the time, so it’s good to have gotten used to that earlier on in your career.

Susie Clements: Lloyd, thank you for making time to speak with us today.

Lloyd Pitchford: Pleasure. Thank you, Susie.

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