Hosted by John Jeffcock, CEO of Winmark and author of The Suite Spot
The Suite Spot interview with Patrick Butcher
What background and skills are essential to being an effective Chief Finance Officer? How do career experiences and connections impact your ability to contribute at Board level?
In this episode of The Suite Spot, we talk with experienced Chief Finance Officer Patrick Butcher about his career path from public services, to private equity and then FTSE100.
We hear about the people and events which influenced Patrick, as well as his advice for those who aspire to executive leadership roles in big corporates.
Patrick offers a number of interesting insights for those climbing the leadership ladder, including:
- How non-traditional paths to the boardroom are possible if you are willing to learn how to interpret the numbers
- The importance of understanding different viewpoints – customers, employees and shareholders
- How a passion for lifelong learning and saying yes to new opportunities is key.
LEADERSHIP LESSONS AND CAREER ADVICE FROM
Patrick Butcher, CFO at Headlam Group plc. Previously at Capita, Go Ahead Group and Network Rail
TRANSCRIPT
John Jeffcock (JJ) Welcome to the Winmark Suite Spot interview series, where we explore how to reach lead and deliver a C-Suite role. Today, I’m delighted to be joined by Patrick Butcher, who is a FTSE 100 and FTSE 250 CFO, having been CFO at Headlam Group, Capita, Go Ahead Group and Network Rail. Delighted to have you here with us today Patrick.
Patrick Butcher (PB) Thank you, John. I’m looking forward to this.
JJ I’ll start by asking you what did you want to be when you were a child?
PB When I was a young child I guess I didn’t look much beyond what I wanted to do tomorrow. And the first point where I really had a view was as I was leaving school, my father asked me what I wanted to do and I said I wanted to get out to Cape Town (I grew up in South Africa) and study to be a lawyer. He told me that was a very bad idea and I explained that I’ve been watching LA Law and they made a lot of money and they had a lot of sex. So, I definitely wanted to be a lawyer. Anyway, he got his way and I became an accountant. So that conversation was a pivotal moment.
Not only did my father not want me to be a lawyer, he also didn’t want me to go to university because he felt that he’d paid for me to drink and play rugby at school for the last three years and so wanted me to get a job, which sounds perhaps a little harsh. But my first job was at Deloitte, I was an article clerk and studied my degree by correspondence while I was working. That was the decision that put me on the track to being an accountant and I guess to some extent is why I am where I am today.
JJ Could you summarize your career in one minute then?
PB I came over to the UK in the early 90s with Deloitte and was there for 12-18 months or so. I did a couple of jobs in the NHS and then got my first Finance Director role when I was 26 as Finance Director of Kings College Hospital, a large teaching hospital in southeast London. From there I went to London Underground as Finance Director in the middle of the Ken Livingstone era, when there was all kinds of trauma around the PPP. Then I went into two private equity Finance Director roles, one in property and one in rail freight, and from there into Network Rail. I then began my PLC career, which started with Go Ahead Group, which was in the rail industry and therefore a a natural fit for me, then to Capita business services and technology.
Then I took a break and I’ve now transitioned from full-time permanent executive roles to a hybrid career. I think rather than a portfolio career, hybrid is a word of the moment. And my hybrid career is a couple of non-executive advisory roles, one in a steel foundry up in Sheffield and one with a private equity start-up. And then my full-time role at the moment is as CFO of the Headlam Group, which is the nation’s favourite floor coverings distributor – that is an interim role covering for the Chief Financial Officer. He was promoted to CEO and they’re in the process of recruiting a replacement.
JJ Isn’t 26 quite young to get your first FD role?
PB Well, at the time I didn’t think it was young because I was arrogant and convinced in my own abilities and certain that I knew better than anybody else. Looking back, I’m horrified at the responsibility I was given both of Kings but also at London Underground, which was a much bigger organization.
Yes, it was young but one of the things that it taught me is that if you give people who are motivated, focused on learning and prepared to put in not just the hours but the mental and emotional energy, then people can succeed. And so that’s one of the things I’ve always tried to do is to give opportunities to people that are enthusiastic, committed and talented. For me that’s kind of what diversity is about because that allows you as a leader in an organization to support the talent.
I was very fortunate that I had an experienced Group Financial Controller and went in for a meeting with him a week or two before I started. I said, “It’d be really helpful if you could give me a list of things that you think it might be helpful for me to focus on.” I went into my big office on the first day and on the middle of my desk was a list of things for the Finance director to do: No.1 was ‘Resolve multi-million-pound deficit’ and to this day I have no idea what points to 2, 3, 4 and 5 were because I went into blind panic!
JJ And, other than the courage to put yourself forward, what do you think enabled you to get that first role?
PB I’m really conscious of the privilege that I brought into my career. I was privately educated. Both of my parents went to university in the UK. My mum is English and my dad is South African and they met at Cambridge. I’m a third-generation accountant, so I grew up with a supportive family environment, a first-class education and then access to opportunity. Yeah, I can tell a story that I didn’t go to university and that makes me sound a little bit deprived. But when I tell the story that my first job was at Deloitte because my godfather was a partner in the office that I got the job in then that puts a different spin on it, there’s no doubt that.
I was fortunate in the start that I had in life and that created a combination of opportunities and a network, but also my father had high expectations and that filtered into me. And so, as I was saying slightly light-heartedly, it wasn’t just that I was arrogant – I expected myself to succeed. I think that it’s the combination of being prepared to ask the stupid question, being prepared to learn and being prepared to look outside of whatever your role is. A good piece of advice for people is ‘don’t just do what’s asked of you, do whatever you can and whatever you think will develop and stretch you.’ I’ve always looked for opportunities to broaden the range of things that I have got involved in.
“Networking plays a huge role because you learn a lot from engaging with different people. One audit committee chair had financial services experience, where the compliance and control environment was more extreme than we needed in the organization, but the discipline, rigour and structure that they put into that was quite something. You gather those experiences and take them with you. Each job you start you say - here's what I know, let me see what I can learn.”
JJ So if you reflect on your career, what were the moments or decisions you made have been key to your progress?
PB I only wish that I could pull out my career plan from 1992 and say I came to the UK, this was my plan and look how well I executed it. I can’t speak for anybody else, and I know there are people who are very structured and organised about making sure that they do different roles to get them different experience, but because I stumbled into being a CFO at a very young age, I didn’t really have the need to go around the different departments and gather the different types of experience. And so therefore for me it was a question of what’s the right organization, what’s a different organization and bluntly I have always been phoned and talked to about an opportunity and I haven’t got every single opportunity. I’ve been frank about that.
I got some public sector experience early on, then realized I was trapped in the public sector and needed to get out and private equity was an easier route than the PLC world. PLC world is very restrictive unless you’ve been a PLC CFO you can’t be a PLC CFO, which isn’t obvious. Catch 22, so I went into private equity, really enjoyed my time there understanding the importance of investors being close to the business and really being aligned with management.
I then went to Network Rail because it’s such an amazing organization, it’s central to the UK. I’m delighted I’m not there at the moment with all the rail strikes that are going on and I wish them all the best as they navigate their way through that. But it’s such an amazing organization that that was a wonderful opportunity and if I reflect on what’s the job that I’ve probably got the most from then it’s probably Network Rail. Then from Network Rail having been told that I couldn’t be PLC CFO then that was another decision if I wanted to get the PLC tick in the box as it were and so I focused on doing that. So in terms of types of organizations and career moves, those have been the two pivot points: one to move into private equity and one to move into PLC World.
JJ And have you ever had on that journey a mentor or guide, someone who steered you?
PB In my early career I was too confident in my own abilities to recognize the need for a mentor. There have been lots of people that I have worked for that I have come across, from whom I have learned and one of the things that I do both in my work life and in my personal life, is trying to study the people that are a little further along than me. So, when I had young children, I was looking at people who had teenagers and talking to them about what they had wished they’d done when their kids were younger so that you’re trying to avoid some of the mistakes and similar in my work career.
I think the other thing for me is the responsibility for learning and development is not the company’s. There is no business that you will ever work for that cares more about your personal development than you do. And so, I’ve done a number of things over the course of my career where I’ve focused on self-learning. An example is at Network Rail. I was brittle and directive in my style and they had some occupational consultants. I got one of them to shadow me and counsel/coach, somewhere between the two. But it was focused very much on my behaviours and that was transformational – turned me very much from a place of telling to a place of curiosity and inquiring.
And I think if there’s a single tip for people who are trying to make the move from senior management into what we call the C-Suite it’s recognizing the skills, focus and drive that got you to where you are, and other things that are going to trap you where you are. I’m talking about big organizations, not start-ups where it’s completely different, but in a big organization what will trap you is the need to always be right. The need to come up with the answers, whereas the more senior you become, the more complex the problem has become and therefore the less likely it is that you will have the keys to the solution and the more likely it is that you will need input from other people. And therefore as you transition into those roles, transitioning your personal style from one of being certain and confident and coming up with the answers to one of curiosity and enquiring, collaborating and encouraging. I’ve found that’s worked for me. I don’t know if that would work for everybody.
JJ And that person who was giving you feedback on your behaviours, was that as a single day intervention or was it something they created over time?
PB No, that was the joy. Oh, I’d used coaches from outside the organization before and I think it’s a useful tool, but the problem with it is that all the coach sees is what you bring to the interaction, whereas the benefit of having somebody who was in the organization was that she understood the culture of the organization. She knew who my real contact points were, she could go around and talk to people. She could watch me in meetings and provide real time feedback.
There was one meeting I particularly remember where the team of people who were doing a project came in and they’d been in the month before and they hadn’t done what I had told him to do. And so I explained to them, you know, what it was that they hadn’t done in pretty dismissive terms. I’m not proud of the way I behaved. And when we came out of the meeting she then sat down with me and, it might have been a day or two later, said just do you think that those people are gonna come back to you if they have a problem. I said, well, maybe, maybe not. And then she said, do you feel better for having shouted at them? And I said you’re absolutely right, I feel better. They needed to be shouted at and she said it’s interesting because I haven’t actually looked at your employment contract, but I’m sure that it says that you’re paid to be effective rather than paid to feel better. And so that’s, you know, was a big intervention in terms of changing me.
And there were a number of similar encounters that we had because I don’t think that change comes from a single moment inside it. It does for some people, we all know the stories of people whose lives get turned around by one moment. But I think for most of us, it’s about reforming the habits that we have got into and redeveloping our style.
JJ And have you had any career crisis moment? It sounds like it’s all been quite smooth sailing for you?
PB Well, if you look at the organizations that I have worked for, you’ll see that it’s never been smooth sailing. So I’ve been involved in plenty of organizational crises and my style (and I think it’s a strength but of course an overused strength becomes a weakness) is to be absorbed in the organization that I’m working for, become totally mentally and emotionally immersed in it. And therefore when the organization hits across this point that increases my stress levels.
I’m not sure I’ve had a career crisis. I took some time off after the private equity thing before Network Rail it was that the GC so it was 2000 and like that I was that I was off and I began to think I would never work again. And you get all of that self doubt and what have I done? I’ve made a mistake. I shouldn’t have resigned. Yeah.
I’ve had significant moments of self-doubt and I’ve had huge challenges in doing what I’ve been asked to do at different organisations and I’ve been through periods of intense stress, there was one job I had where on the way to work I was physically ill, a couple of times during a two week period because I was so anxious and that I guess is the price I paid for pushing myself into difficult roles.
Everybody’s different and lots of people experience that level of personal stress and anxiety. But that’s been where my pressure has come from. And then as you get as you get older and you develop and mature and hopefully you get more balanced and have more perspective then I think it’s been easier in the second-half of my career in some ways because I’ve been able to have a bit of perspective. Easy for me to say because I was fortunate that I got to a point of financial security relatively early on and therefore you, you don’t quite have that same mortgage bills pressure and which does make it easier.
“One of the things I've always tried to do is to give opportunities to people that are enthusiastic, committed and talented. For me that's kind of what diversity is about because that allows you as a leader in an organization to support the talent. A good piece of advice for people is ‘don't just do what's asked of you, do whatever you can and whatever you think will develop and stretch you.’ I've always looked for opportunities to broaden the range of things that I have got involved in.”
JJ And you said earlier about your curious mindset and the shift towards that. How have you developed knowledge and skills, what has been your approach to that?
PB So for me, as an accountant, there is a relatively clear requirement for continuing professional education. So, there are there are regular updates to what we call the accounting standards. And so it’s how you put together accounts. So there’s an escalator that forces you to keep doing that professional learning.
At the broader set of management skills I’ve worked at a number of big organizations and big organisations always have little programs and where you need to get a bit of this and a bit of that and a bit of something else. And so I’ve seen lots of different ways of doing management development and I guess that once you’re in the C-Suite it’s much more about in my view behaviors and style than it is about skills. There are some specific skills around leading people and prioritizing and organizing and governance and all those sorts of things which I guess I’ve learned over time.
What did I know about risk and control? When I was going to the Kings College audit committee in 1994 – not very much. As the rules have changed, and systems and processes have evolved, I’ve always just needed to keep up and therefore have done whatever I’ve needed to do. The bigger accounting firms are really helpful and they run programs and seminars which are good places to go.
So I don’t think it needs a lot of sort of expensive interventions I think some people maybe if you’re trained as an engineer and you want to get into business, going to do an MBA is probably a sensible thing because you don’t really learn anything about business in your engineering degree. The benefit of being an accountant is it’s kind of all about the business.
JJ And has your network played a role in that, or networking?
PB Networking plays a plays a huge role because I think you learn in a structured setting when you’re on a course or listening to a seminar or a lecture, but equally you learn a lot from engaging with different people and that’s both the informal network, the people that you engage with outside of your core role, but also I’ve worked with 13 or 14 chief executives, 14 chairs and eight or nine audit committee chairs, probably 80 non-executives, maybe more over the 25 years that I’ve been sitting on boards with non-executives, and lots of different audit firms.
And so from each of those people, you pick up a little bit of what they know. If you think about our species, our superpower is cooperation – what does cooperation mean? Cooperation means learning from other people and so I’ll try and focus on learning from the different audit committee chairs because they’ve all had different experiences. One committee chair had a lot of financial services experience, which isn’t my skill set, and the compliance and control environment there was more extreme than we needed in the organization. But the discipline and rigour and structure that they put into that was quite something, so we can learn from that and we can do it a little different. You gather those experiences and you take them with you and each job you start you say here’s what I know. Let me see what I can learn.
JJ So as Finance Director and then CFO, you have always been part of the EXCO, haven’t you?
PB Exactly. Since 1994 I have sat in board meetings – I’ve stopped counting but well over 100 audit committees and I’ve been on a variety of different executive committees – and one of the things I’ve learned is that when a chief executive says I want to rethink the way the meetings work. What I’ve learned is that the meetings work. In an organization I’m not talking about a brand new chief executive. The meetings work the way the chief executive subconsciously wants them to work. And even if he or she says I want this or I want that, I know that’s not gonna happen. Because yes, you don’t like debates or you do like debate or you like consensus decision making or you like to make the decision yourself and tell us or you like to work bilaterally and gather input and then come and say I’ve consulted with you all and this is what you all agree on and you all look at each other and say do we.
So you can spend days redesigning the meeting structure and it’s not gonna make any difference. So you learn things as you go along. How does that help? Would it really help with his prioritization?. The key challenge for any executive in an organization of I think probably any size is identifying what are the topics, areas, themes, programs where I should spend most of my time.
I have a rule which says ‘I will only make the decisions that only I can make and I will only do the things that only I can do’. That drives a lot of delegation but it also means that you know as humans we have a finite decision making capacity. So if you are making lots of decisions that somebody else could make that limits the amount of mental energy you have to make all the really important decisions that you should be making.
I’ve tried that in my personal life. In the old days when we all used to wear suits I had navy blue, grey, blue, white and pink shirts. I stopped wearing cufflinks and I stopped wearing ties because that’s two fewer decisions that I needed to make every day. And for me, that experience really helps with prioritization, and that’s been particularly useful in my current role where I’m an interim. I’m there somewhere between six and nine months, focusing in on the areas where I think I can make the most difference, add the most value. I’m there for such a short time to make an impact. I really have to focus on what’s gonna make a difference.
JJ Do you think the pandemic has changed your behaviours and style in any way?
PB It has changed my behaviours and style. Has it changed the technology and how we have to do things? Absolutely because we would be having this interview in your office with a set piece camera instead of on Teams. And I think it has for a lot of us. And I can only speak from the privileged perspective that I have it. It’s a lot to rebalance our lives.
Would I have taken the decision that I took age 54 to move away from permanent full-time employment if we hadn’t had the pandemic? Probably not. And so I think it clearly has had a huge impact on all of us and many people have sadly been through horrific times but it has changed I think some of the linkages and connections and we don’t yet know how you know the longer term impacts in terms of management style. I think it’s changed the methods rather than the general approach.
JJ What advice would you give to someone who is aspiring to be in your type of roles who is in their mid-late twenties?
PB The first piece of advice I would give them is to be really clear what it is that you want from your life. Because I think there is a tendency sometimes to either over or under focus on our careers at the expense of the rest of our lives. If you push into senior roles, they take over your life, people pay you a lot of money, they expect you to be available 24/7. You won’t work 24/7, but you’re expected to be available.
One of the features of life as a senior executive is that people send out papers on a Friday afternoon for meetings on a Monday and Tuesday. And therefore you have no option but to read those papers over the weekend. And there’s an assumption in the organization that senior executives have nothing to do on the weekend. So you may as well give them 200 pages of material to read for a meeting but there’s lots you can do to change that.
So the first piece of advice I say is think about what you want from your life. What’s important to you in terms of your personal life, your relationships, your family, if you have your health, all of those things and make sure that whatever decisions you make about your career fit into the pattern for your life. Lots of senior executives who’ve over focused on their career are on their second or third marriage. And yeah, life has sort of turned out the way they wanted, but sort of not, so think through what’s really important to you.
Once you’ve decided that that all makes sense and what you really want to do is focus on driving your career forward. That then for me is what I was talking about earlier – you need to have the education you need to have the skills and develop the skills that you don’t have. I’m a passionate believer in growing your strengths rather than managing your weaknesses. If you spend more time on the things you’re good at then then you’ll become excellent at those rather than just not so bad at some of the other things so focus on your strengths all the basic stuff is important.
Make sure you know all the headhunters that are in your sector, that are in your functional line and speak to them regularly. Keep your CV up to speed and network but ultimately you get your next role by succeeding in your current role, so make sure that you understand what’s expected of you. You’re managing your stakeholders both up and sideways and down so that your view of your perception is consistent with theirs and you’re driving to continually improve your actual performance.
And then think about what you can do to expand your potential. You know that for me that conversation about not being direct and dismissive and being effective was fundamental cause it meant that I stopped thinking about what I could do and started thinking about how I could help other people be more effective. And there’s no doubt that I’ve been more successful and done better since I’ve focused more on how to make other people affective, whether that’s the people in my team, the people I’m interacting with or even, boards and chief executives. So focus on not only how you make yourself effective, that’s if you’re in your early stages of your career, you need to be building your own capabilities. But as you start to develop those in parallel, one of the key skills I think you need to develop is how to make other people be effective. And then be realistic, understand the market that you’re in, understand the kind of role that you’re trying to look for, make sure that you know what skills, knowledge and experience you need in order to be a credible candidate for the next role up on the ladder. And then set about in a reasonably structured and rigorous way to gain that experience, which involves volunteering for projects, getting visibility. Whatever we do to try and remove bias from recruitment and promotion decisions, visibility matters. If senior people see you and know you, you have a better chance than if you’re just doing a brilliant job, hidden in the cupboard.
JJ Thank you, Patrick. Thank you very much indeed for all your advice. It’s been a great interview and I look forward to working with you again very soon.
PB Thank you, John. It’s been an absolute pleasure.
