Jan 15, 2020
It was back in 2002, Stephen Grist says, when he first punched through a surface of rigid assumptions to grasp the innovative levers that would propel him into the ranks of strategic CFOs.
At the time, Grist was the CFO of Viatel, a technology company whose management and sales teams were eagerly seeking to reestablish the company’s footing along a growth path after having recently emerged from a Chapter 11 bankruptcy.
With its bankruptcy in the rearview mirror, the company emerged with an unbridled appetite for growth—but one that was perhaps lacking in long-term vision.
Says Grist: “The existing business managers were so focused on ‘Take that hill!’ and ‘This is our business, and this is the path that we’re going down!’ They just were not capable of identifying the disruptive risks.”
Having already logged a string of seven-day weeks to hasten Viatel’s exit from bankruptcy, Grist might have found it easy to applaud the sales team’s mounting tactical wins and provide diligent governance. Instead, he engaged the company’s general counsel, and together they approached a number of bankers in order to “add on” some small Internet businesses that could quickly diversify the types of services that Viatel offered to its small to midsize customers.
According to Grist, Viatel at the time was struggling with the “The Innovator’s Dilemma”—a phrase referring to disruptive competitors first coined and used as the title of a popular text by Harvard professor Clayton Christensen.
“You’re so caught up in your vision of the company that you’re not really capable of identifying where those disruptive risks are affecting the company as they come in from different, different directions,” says Grist, who looks back at 2002 as a turning point for both Viatel and his CFO career.
Moving forward, Grist has entered new CFO roles as a disruptive risk expert tasked with questioning assumptions.
“Every time I’ve come into a company, it’s been like, ‘Okay, it’s time to do the long-term business plan’—but you’ve got a different view of the world, so you can ask all those questions,” says Grist, who since Viatel has served in a string CFO roles for both founder-led and VC-backed companies.
Says Grist: “As the CFO, you bring your experience to bear and you identify risks as you build the next year’s budget or the long-term model from really being in a position to question assumptions.” - Jack Sweeney