VideoEarly in the administration of President Andrew Jackson, he began to meet regularly with an unofficial, intimate group of advisors that came to be known as his "Kitchen Cabinet." Although Jackson continued to rely on department heads to carry out the duties of their offices, he turned to his Kitchen Cabinet — which included two members of his official cabinet and other close associates — to help him shape the policies that would guide the nation. And yes, goes the story, they held their meetings in the White House kitchen.
Since Jackson's presidency nearly two centuries ago, "kitchen cabinet" has come to refer to any small group of trusted advisors who influence the decisions of presidents and potentates. But if you're a finance executive who's not yet on the top rung of the ladder, do you need a kitchen cabinet of your own?
"I don't know too many people who can be successful without access to a network of trusted advisors," says Ron Copher, chief financial officer of Jackson, Ohio-based Oak Hill Financial Inc. "Most financial managers have networks outside the office they can and should consult."
"Many people understand the idea of networking for careers," adds Saj-nicole Joni, chief executive officer of Cambridge International Group. "But it's been more about calling people and asking them to do something" — say, to provide an introduction.
By contrast, Joni's Massachusetts-based consultancy offers professional "thinking partner" services, usually on such big-picture topics as measuring performance, checks and balances, sharing best practices, team building, and judging the overall effectiveness of a financial strategy. Cambridge International Group provides these services to leaders in Fortune 100 companies, but Joni insists that not-so-senior executives at smaller companies can also benefit from a kitchen cabinet — and the sooner they get started, the better.
What Should You Look For?
Before you start lining up friends and colleagues, consider what Joni calls "The Geography of Trust" in the March 2004 Harvard Business Review. Joni describes three kinds of trust, which in some combination characterizes most relationships: personal trust, expertise trust, and structural trust. Personal trust is that faith you place in someone's integrity; expertise trust is confidence in someone's mastery of a particular discipline or process; structural trust refers to the relationship between your role and ambitions and the role and ambitions of your advisors.
Not only does trust vary from one relationship to another, notes Joni, but it can also change within any given relationship. It's essential to understand what kinds of trust you place in the members of your kitchen cabinet — and how the nature of that trust might change after a promotion, the assumption of new duties, the imposition of new regulations, and other "structural" changes (hence the term "structural trust").
Understanding the nature of personal trust, one would hope, is something you've been working on all your life. Structural trust, the most complex and perhaps least understood aspect of trust, we'll return to later.
Your Own Circle of Experts
Recent graduates, still fresh from lively discussions inside and outside the classroom, can begin building a kitchen cabinet with schoolmates — and, if they're fortunate, a favorite professor. Joining your alumni association can help you firm up these relationships and keep track of which classmate can provide guidance in which area.
Once finance professionals rise a few rungs on the ladder, they should expand the pool of candidates for their kitchen cabinets. Professional associations (far too many to list here) are perhaps the most common source. They're especially helpful for executives at small companies who may otherwise find it difficult have access to a wide range of different points of view or expertise. For example, the Financial Managers Society (FMS) serves finance executives of banks and credit unions, many of them regional or local firms.
In addition to holding monthly meetings, FMS runs a "listserv" — an automated E-mail list that distributes comments, questions, and answers posted by list members across the country. When Jay Dodds — chief financial officer of First Federal Savings Bank in Twin Falls, Idaho — wanted to know how much other banks were reporting in loan costs, posting a question garnered a quick response on a just-released FAS 91 cost survey. Dodds, in turn, has shared his bank's experiences with audit committee charters required under Sarbanes-Oxley.
Dan Mayleben also attends monthly meetings, but as part of an informal group with other like-minded colleagues. The chief financial officer of Minneapolis-based HighJump Software, a supply-chain-management subsidiary of 3M Corp., Mayleben gets together each month with area CFOs to discuss interactions with the board, or insurance, or the cost of providing benefits — whatever they decide to add to the agenda.
Senior Executive Network takes a more formal approach. At twice-yearly meetings, finance executives are grouped by industry, then divided into subgroups by revenues (but also with an eye toward separating competitors). Small breakout sessions discuss topics ranging from strategic planning to relationships with the CEO.
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