Case Study: Was the Director of Finance Set Up to Fail?
Background
A Director of Finance (DOF) was hired to stabilize and improve financial operations in a property and asset management company. At the time of hire, financials were 180 days behind. Through process improvements and team training, the DOF achieved a 5-day month-end close—an unprecedented milestone in the company’s 17-year history. Despite these achievements, the DOF faced systemic challenges that ultimately led to her resignation.
Summary of Events
- Leadership Undermining: The CEO repeatedly bypassed the DOF by assigning financial tasks to unqualified staff, causing confusion and rework. The COO defended direct reports despite repeated errors.
- Sabotaged Strategic Opportunity: The DOF was invited to present a CFO vision, but partners were unprepared and dismissive, derailing the discussion.
- Toxic Workplace Culture: The COO and Office Manager labeled the DOF as “problematic,” instructing new employees to avoid her, creating isolation and reputational harm.
- Unrecognized Achievements: Despite achieving operational excellence, leadership outsourced financial reporting, signaling disregard for her contributions.
- Impact on Team Morale: Outsourcing demoralized the offshore team, undermining trust and engagement.
- Emotional Fallout: Upon resigning, the CEO expressed surprise but never acknowledged her departure. She received no recognition during her notice period.
Key Issues Identified
- Undermining of authority and expertise
- Lack of role clarity and leadership alignment
- Toxic internal culture and favoritism
- Dismissal of achievements and innovation
- Disruption of team morale
- Emotional invalidation at the point of exit
Lessons for Leaders
- Empowerment Requires Authority: Assigning responsibility without decision-making power sets leaders up for failure.
- Prepare and Align Leadership: Strategic meetings require clear objectives and informed participants.
- Culture Shapes Outcomes: Gossip and exclusion erode trust and performance.
- Recognize and Retain Talent: Failure to acknowledge contributions drives high performers away.
- Emotional Intelligence Matters: Leaders must validate and support their teams, especially during transitions.
Discussion Questions
- What leadership behaviors contributed most to the DOF’s decision to resign?
- How could the CEO and COO have aligned better to support the DOF?
- What cultural changes would prevent similar failures in the future?
- How should organizations handle strategic role transitions to avoid undermining trust?