Fiduciary responsibility is at the core of any CFO role, but recent shifts have introduced a more strategic and visionary side that includes collaboration and alignment with the organization’s CEO.
Quartz Network Executive Correspondent Britt Erler sat down with Nicole Milnthorpe, Chief Financial Officer of Smokey Bones to discuss how she’s navigated the changing CFO role throughout the years and her current focus on innovation and value creation.
Nicole shares insight into:
- How the CFO role has evolved over time
- The importance of value creation
- Ways to prepare for upcoming industry trends
Quartz Network: Can you share a bit about your background and current role at Smokey Bones?
Nicole Milnthorpe: I’m the Chief Financial Officer for Smokey Bones. Smokey Bones is a 61-unit restaurant chain, all corporate owned, and we are located in 16 states around the country.
I started my career in Big Fours. I spent a little over 12 years with Deloitte & Touche on the audit and consulting sides. Then, I had the opportunity to move into the restaurant space industry. I spent a couple years with the Shula family, I was the President and Chief Financial Officer for the Shula’s Restaurants, and now have been in my current role with Smokey Bones for about five and a half years.
Quartz Network: How has the Chief Financial Officer role has changed throughout the years?
Nicole Milnthorpe: With my journey of being 20 years in this financial role, from my days at Deloitte and being on the private side, I’ve seen so many different CFOs in their roles, and it’s really has evolved and changed over the years. When I started my career, the CFO role was much more of a fiduciary role.
Some companies, they range from fiduciary to visionary, but really with the foundation being on that fiduciary side. The traditional CFO role includes looking at financials, expense management, evaluating investment processes, historical reporting and forecasting. While ultimately, the CFO has always been tasked with being the center of the controls and processes for the organizations. These are fundamental responsibilities that will always remain within our role.
In recent years, what I’ve seen in my role and many of my counterparts is that the shift in the CFO really has become more strategic and visionary. There much more alignment with the leadership team along with cross functional and collaborative, direct alignment with the CEOs within the organization.
So I think the expectation now is that the foundation is a strong financial back, but the most successful CFOs and the evolution is really a long term value creation. Generating long term business value. I am very fortunate to work on a team where I am aligned side by side in value creation and strategic alignment. I think it really does offer a different perspective on business as we navigate through.
Quartz Network: What are some of the major differences between the traditional idea of the CFO and this new value creator that you spoke of?
Nicole Milnthorpe: The traditional CFO, especially as we’re navigating through the pandemic, is focused on business and liquidity preservation. Preserving cash models and cost reduction. We spent a lot of time this year on PPP implementation of all kinds of different aspects of the financial industry. But it’s not just about managing the risks and liquidity, it’s really being about forward thinking through investments and revenue development.
The way that I like to describe this new, kind of evolved CFO role is really a generalist in the C suite migrating over to being a change agent leading a transformation across the organization. For example, over the course of my time at Smokey Bones, I’ve been over the roles of almost every department with the exception of operations. We keep operations with those that are really great operators. But I had oversight on the procurement, finance, accounting, legal, and at one time, HR, development. All of the various different roles.
The CFO role really is the core of the business relationship. It allows us to really offer input into all of the various departments who really drive value, and not only look at the short-term business, but really be able to provide input on how to drive the long-term value creation.
Network: Were there certain aspects of your company that was set up for success to make it through the pandemic?
Nicole Milnthorpe: Our leadership team was a little bit more forward thinking and dynamic than many leadership teams. We had a very good strategic plan already deployed pre-pandemic. So my first several years of the company, we really spent managing the business to be financially responsible. We went in very low lever, and we were optimized from a cost perspective. That allowed us to navigate through the pandemic.
What the pandemic did was it really accelerated the forward thinking and the nontraditional thinking that we had to do. Heading into the pandemic, we already had a strategic vision set up for the company where we were focused on digital growth and consumer branding realignment of the brand. We had strong relationships in the restaurant space, we had strong relationships with our third-party delivery partners, so we already had a really good platform heading into the pandemic. If anything, it accelerated our need for the investment in growth.
Fortunately, we didn’t slow down, we sped up. That has led to great success for the organization. All restaurant companies really struggled this time last year, and that part was a surprise. It was the overnight closing of dining rooms and regulation. None of us were prepared for that. But a lot of our competitors were starting to look at the digital strategy, third-party marketplace delivery, catering off premise. We were already in that space and we were already successful in that. So we were able to really put some tactics in place to accelerate our growth and recovery, which fortunately, we’re in a fantastic position now within the industry.
Quartz Network: What are some innovations that Smokey Bones is putting in place, especially in the casual dining sector?
Nicole Milnthorpe: Heading into the pandemic, in our 2019 strategy, we had a strong pillar on digital and technology. At the time, we didn’t realize how critical and important it was going to be. In 2019, we hired our fantastic Chief Digital Officer that was very forward thinking.
In our strategy, we weren’t looking at digital in the casual dining space. We were comparing to Amazon and Domino’s, and that really easy guest experience and easy user journey. That was our strategy in 2019 before any of this hit.
What we were able to do was invest in all of the hardware and all of the software within the company pre-pandemic, which allowed us to really deploy a lot of this these initiatives. During the pandemic we launched a new ecommerce platform, direct delivery channels, pay at table and QR code ordering. We’re just at the beginning of our digital journey. We know that this is where the industry is going. We want casual dining to really catch up with the technology industry, and make sure that we integrate technology into that casual dining experience, because it will set us apart from our competition.
Quartz Network: Is Smokey Bones taking part in the new virtual trends that we are seeing such as virtual brands and ghost kitchens?
Nicole Milnthorpe: Those are all the buzzwords in the industry right now. We are so fortunate that we were in this space back in 2019. We developed two virtual restaurant concepts back in 2019 with our third-party platform. So back in 2019 we looked at what we were really good at as a brand. Smokey Bones, to its core, is known for barbecue. But we have great platforms with wings, burgers, and many other things that aren’t top of mind when you think of Smokey Bones.
So we partnered with our third-party partners to find out where the needs were in the market. Out of those discussions, we developed two virtual brands, which were the Burger Experience and the Wing Experience. So in 2019, we had those launch, they were going, and in 2020, during the pandemic, we actually accelerated those brands. They weren’t just extensions of our current brand, but they have their own branding, their own packaging, their own ecommerce ordering platforms. Now, we’re operating over 160 brands out of our locations, which is a great space to be in.
Quartz Network: Now that you’ve seen the differences these innovations have made for your company and for your consumers, what do you believe is the future for the casual dining space?
Nicole Milnthorpe: I think the way that the consumers are looking at casual dining will be forever changed. Historically, it was just the routine of going out to eat. Now, I believe that the consumer views casual dining as an experience. It’s a privilege now to be able to go out and eat—something we never expected that would be a privilege—it was more of just an everyday thing.
The successful casual dining restaurants, I believe, will come in this digital journey, and making sure that we’re focused on the guest experience. If you decide that you want to have food on your couch and deliver, we make it very easy to get it to you. But if you do want to come in the restaurant, then you’re given exceptional customer service, and a different experience that makes you want to go out into the restaurants. I think the start of the investments is just beginning. I think there’s a lot of upside and opportunity for the casual dining restaurants that are innovative and move forward.
Quartz Network: What advice do you have for other CFOs to ensure they’re not only helping themselves and the company succeed, but also their teams?
Nicole Milnthorpe: Number one, don’t be afraid of change. I think that being creative and looking at new opportunities is where you will drive value and growth in your businesses. Doing the same thing that we’ve always done will sustain your business, it will create longevity with your business, but it’s not necessarily going to grow the value of your organization.
I think, as CFOs, we have such a critical role in being a cross functional leader and providing a balanced approach to making sure that we’re not stalling, that we’re making the investments, there’s trial and error, but making sure that we’re not making bad decisions for the organization.
With the examples of the virtual restaurants and a couple ghost kitchens we’ve opened over the pandemic, those are really low-cost investments. So they’ve been great to try and they’ve been very successful for the business. You can’t be afraid of trying things and worried that it’s going to be a distraction, because that’s really where the value creation is going to come in.
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