CFO THOUGHT LEADER

Back in 2012, when Michael High was heading up corporate planning across 30 countries for Shell, the energy company’s CFO made it known that it was time for Shell’s business leaders to reconsider their ritual of renegotiating annual business targets.

To that end, Shell’s finance leader let it be known that the business units could skip the company’s corporate planning process in the coming year, as an affirmation of their commitment to the targets they had agreed to the year before.

“I actually think that this was the right insight at the time, but it generated a ton of knock-on consequences over time,” explains High, who commends the finance leader’s willingness to take head on what’s recognized in business at large as the budgeting process’s greatest vulnerability: target renegotiation.

Still, the consequences were real.

“When we went to turn on the planning system in 2014, most people didn’t remember how it worked. There was a series of intricate steps—something like 146 steps and different jobs required to get the IT application to do everything that it was supposed to. And, of course, if you do it only once a year, nobody remembers all the right steps,” comments High, who notes that the circumstances also exposed how talent often factors into corporate planning.

“If you think about the FP&A community and the IT community that supports FP&A, you realize that these tend to be high-turnover roles. They tend to be career-developing roles. So, you’d put people in them for maybe 2 to 3 years, typically. Well, by the time we got around to doing business planning in 2014, 80 percent of the organization that either had facilitated the planning process or controlled the IT systems had turned over,” recalls High.

Today, High views as a painful lesson the subsequent late nights and weekends required to get Shell’s corporate planning process back on track—times when many members of Shell’s FP&A team paid a high price. “I was accountable for the process, so it was a leadership failure on my part,” he states.  

However, High observes that something more did arise from this consequential episode. Over the next few years, High says, he began to note how a shift was under way within organizations as the regular enhancement of cloud applications began to surpass the functionality improvements of legacy ERP platforms. Meanwhile, when it came to corporate planning, he became focused on how the talent demands of certain IT systems had traditionally put the planning process at a higher risk.

According to High, he was determined to “de-risk” technology in planning and eliminate IT complexity.

To better evaluate some of the new cloud applications, High began attending different conferences, including the annual gathering of the Association of Financial Professionals (AFP)—where the cloud vendors always highlighted how they were zeroing-in on corporate planning’s pain points.

This helped High to see how the adroitness with which certain cloud applications can access, correlate, and display company data could once and for all put an end to certain planning rituals such as the renegotiation of targets.

Concludes High: “What you have the potential to do today is to really change the nature of the performance conversation and the results discussion. You can go from having a static set of numbers produced outside of the room to a discussion during which you can pull up live data and talk about it and actually seek answers to questions on the spot.” –Jack Sweeney

Bill Zerella’s path to the CFO office began at a company whose customers largely belonged to a bygone era. At the time, Simplicity Patterns was the largest pattern company in the world, and its most devout customers were sewing machine owners across the United States and Canada who enjoyed making clothes for themselves and their families.  

For Zerella, a 20-something-year-old auditor, the critical career decision to join Simplicity was a no-brainer not because of the business opportunity being presented or the position being offered but because of the source of the proffer. The company had recently hired a former Fortune 500 finance leader by the name of Bill Lewis, who was looking to throttle up the company’s business model. Zerella was ready to climb on board.  

“I probably learned more from him during the 5 years I was with that company than I’ve learned in the past 25 years,” comments Zerella, who today is a seasoned tech finance leader who has served in a string of CFO roles, including one with Fitbit, where in 2015 he oversaw the company’s $841 million initial public offering (IPO).

Still, when asked about the consequential experiences that allowed him to advance upward, Zerella is drawn back to his years at Simplicity.

“It was a low-tech company that basically just printed sewing patterns—which might not sound interesting to most—but it was incredibly lucrative and probably one of the most profitable that firms I’ve ever been part of,” reports Zerella, who started in an auditing role but quickly found himself reassigned to FP&A as CFO Lewis looked to beef up the company’s performance measurements. However, Zerella’s arrival in the FP&A planning realm coincided with Simplicity’s adoption of one of the desktop computing era’s most disruptive technologies, spreadsheet application Lotus 1-2-3.

In the months ahead, Zerella’s mastery of the tool would allow the former auditor to move the Simplicity finance team beyond calculators and pencils as he led the automation of the company’s entire planning process—and received multiple promotions.   

In fact, the former auditor held the position of treasurer at the time of his departure to accept his first CFO appointment—only 5 years after his arrival.  

“Looking back, I probably got there too soon—I probably could have used a little more training,” recalls Zerella, whose Simplicity career was also notable for having permitted him to witness firsthand the transformational power of tech—which itself would lead to his relocation only a few years later to a locale he will now likely always call home, Silicon Valley. –Jack Sweeney 

Back in 2008, Cassandra Hudson was interviewing for a senior accounting role at a small tech firm in Boston when the CFO casually shared some “insight” into the company’s future.

“The CEO really wants to take this company public, this is probably never going to happen—we’ll likely sell in the next couple of years,” Hudson recalls the CFO remarking, before he added: “Usually, finance people don’t stay in the event that a company is sold—we just leave and go on to the next one.”

At the time, Hudson says, she didn’t know what to make of the CFO’s comments, especially when they accompanied a job offer.

One IPO and multiple CFOs later, the Boston tech firm was sold to developer OpenText in late 2019 for $1.4 billion.

“It was a much longer journey, but we did end up there,” reports Hudson, who in 2020 stepped into her first CFO role as the culmination to a remarkably linear 15-year career path at the Boston tech firm, which itself grew from less than $10 million to more than $400 million in annual revenue during Hudson’s years on board.

Today, as CFO of EngageSmart, Hudson looks back at the succession of promotions and job titles and experiences that have punctuated her climb upward to senior management and the merits of making a 15-year career investment within a single company.

“The path was definitely not always certain, and there were moments when you would reassess,” comments Hudson, who remembers receiving a challenging international operations assignment from a newly hired CFO—and doubting whether her experience was a good match.

“My sense at the time was ‘I don’t think that I can do this, I don’t even know if I want to do this, I think I’m done here,” explains Hudson, who adds that the CFO reassured her that she had all of what was required to complete the assignment.

Today, looking back at her job interview at the Boston tech firm, it’s clear that the previous CFO perhaps was misjudging the firm’s IPO prospects, dogged future growth trajectory, and ultimate sale timing.

Still, he did mention that there would come a day when it would be time to “go on to the next one.” –Jack Sweeney 

Unlike many of his finance leader peers, Jean Lavigueur has little difficulty in identifying where and when his path to the CFO office began.  

It was back in the early to mid-1990s, he recalls, when—after he had spent nearly 10 years with PwC—a charismatic entrepreneur client named Louis Têtu convinced him to join his supply chain start-up.

Although this company was soon thereafter sold to Baan, Têtu and Lavigueur found that they had unmistakable chemistry—or at least this is what we must assume, given that 25 years later, the two Canadian entrepreneurs have built not one but two other successful companies together.

The first was Taleo, a talent management company that the two men cofounded in 1999 and took public in 2007 (In 2012, Teleo was sold to Oracle for $1.9 billion). Their present firm is AI-powered ecommerce company Coveo, which recently raised $215 million when it went public on the Toronto stock exchange.

Today, as a seasoned CFO, Lavigueur implores his CFO peers to widen their lenses.

“With every crisis, there is an opportunity,” he observes, before recounting how nearly a decade ago, Microsoft—one of Coveo’s largest development partners—acquired his firm’s largest rival, precipitating a nail-biting challenge that led Coveo to make a strategic pivot.

“We used the crisis to accelerate toward the cloud,” explains Lavigueur, who adds that the company fueled its new cloud ambitions in part by forging a stronger relationship with Microsoft rival Salesforce, whose offerings—unlike those of Microsoft—were entirely cloud-based.

Advises Lavigueur: “When you see a crisis, use it to get better.” –Jack Sweeney

When it came time for Jen Herdler to get back into the workforce, she signed up for a refresher course in financial modeling through a weeklong classroom experience in lower Manhattan.

There she would become reacquainted with an old friend: Excel. However, her fellow classmates were another matter.

“I’ll never forget that first day when I walked into the classroom and discovered that everyone was at least 20 years younger than me—I felt so uncomfortable and out of my element,” recalls Herdler, a seasoned finance leader who had put her career on hold roughly a decade earlier to raise a family.

Herdler says that her weeklong immersion among 20-somethings grew only more unsettling when the class was asked to individually tackle different modeling tasks, an exercise designed to stress-test the spreadsheet’s latest functionalities.

Says Herdler: “Their speed always surpassed mine.”

However, the discussions that routinely followed the Excel exercises began to expose something different to Herdler.

“I realized that the communication skills that leaders need to explain their ideas were as critical as they ever had been,” comments Herdler, who notes that the discussions also made her realize how her past experiences in both business and life had enhanced her judgment and enabled an enviable advantage in making business decisions.

Looking back at her classroom experience, Herdler says that her biggest takeaway perhaps had little to do with business modeling.

“The technology is always changing,” she observes, “but business and leadership fundamentals do not.” –Jack Sweeney 

Like many of his finance leader peers, Pete Mariani credits a senior operational role with helping him to plant both feet on the path to CFO office.

However, unlike many of his peers, Mariani found his transformational role to be in Japan.

Back in 1998, he was a director of finance for Guidant, a maker of cardiovascular medical products that was looking to grow its footprint in a number of markets offshore—including Japan, where it had recently acquired one of its distributor partners.

However, unlike many of his peers, Mariani found his transformational role to be in Japan.

Back in 1998, he was a director of finance for Guidant, a maker of cardiovascular medical products that was looking to grow its footprint in a number of markets offshore—including Japan, where it had recently acquired one of its distributor partners.

“I gave an immediate, ‘Yes!,’” recalls Mariani, when asked whether there was any hesitation before accepting the offer that would advance him into a vice president of finance position at Guidant’s soon-to-be-established Japan subsidiary.

Operational experience was one of the incentives that Guidant had promised Mariani, so before long the finance transplant had numerous functional areas within the subsidiary reporting to him, including warehousing and distribution, customer care, IT, legal, and compliance.

As functional areas became established and the American company successfully aligned its culture within the international setting, growth became a natural by-product.

“I think that when we began, we had about 50 employees in Japan—4 years later, there were more than 300,” reports Mariani, whose Japan career chapter would end in Year 4 when he returned to the States after having been named controller and chief accounting officer for the company.

However, upon his return, more than a promotion lay in waiting.

“We landed back in Indianapolis on the same day that they passed Sarbanes-Oxley,” remembers Mariani, citing the devilishly complex compliance legislation that would occupy many of his waking hours in the months and years ahead. –Jack Sweeney 

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3. 728: The Courage of Your Convictions | Joe Wolk, CFO, Johnson & Johnson

Aug 22, 2021

Joe Wolk was about 5 years into his 23-year career with Johnson & Johnson when he was encouraged to take a manufacturing operations position at a newly acquired J&J company in Vacaville, California.

One hot July day, Wolk recalls, he and his wife drove up to Vacaville to visit the plant, where he ended up taking a seat across from the newly acquired company’s plant manager.

As one of Vacaville’s initial J&J transplants, the young finance executive sensed that his arrival was being viewed less than enthusiastically. 

“Within the first 90 seconds, he says: ‘Hey, you know what? I don’t think we need you out here,’” Wolk remembers, citing those words as the plant manager’s first remarks.

Thus began one of Wolk’s least favorite but—as he explains—most rewarding career experiences.

“The first 4 months in that job were like going to the dentist every day,” says Wolk, who tells us that ultimately the reward from the experience was a lesson in when and how to stand your ground.

The lesson began at a team meeting where Wolk tried to offer the plant’s management some practical advice with regard to how to prepare for an upcoming visit from senior J&J executives.

At the time, Wolk says, the plant was working to address a number manufacturing issues as it tried to determine how best to meet customer demand.

Wolk recalls the plant manager’s response to his advice: “We’d like to meet your wish list, but we don’t have time for this right now.”

Instead of just accepting the manager’s feedback, Wolk reports, he arranged a private meeting with the manager, where he boldly elucidated the items occupying his “wish list.”

“If they come out here next week and we can’t provide certain answers, we’re going to have a mess on our hands,” were among the words that Wolk says that he used to prod the plant manager’s thinking.

In the end, the visiting J&J executives were satisfied with the plant team’s answers, and Wolk’s reputation grew in the plant manager’s eye.

“From this point on, he didn’t take a meeting without including me,” concludes Wolk, who uses the story to underscore how finance executives must be ready to summon the courage of their convictions. –Jack Sweeney

Steve and Jack discuss how building trust may be an FP&A professional’s greatest skillset. Featuring commentary and FP&A insights from Planning Aces: CFO Puneet Pamnani of KORE Wireless, CFO Robert Alvarez of BigCommerce & CFO Dave Bernhardt of SentinelOne.

Holiday Replay:

When it comes time for Harmit Singh to brief Levi Strauss & Co.’s management team regarding the latest performance results, Levi’s CFO will often share a briefing document that features a front page bearing the heading “What’s Working and What’s Not.”

“It’s more difficult to understand what’s not working, and it’s the ‘What’s not’ that helps us to determine the areas on which we have to focus to take the business to the next level,” explains Singh, who notes that the “front page” is carefully rendered by Levi’s Financial Planning  & Analysis (FP&A) crew – a team of forward-looking financial professionals whose past feats of analytic derring-do have included helping the jeans maker to foresee the leap from “skinny Jeans” to the baggie look among young consumers.

It’s here among Levi’s crack team of number crunchers that the “what’s not” often becomes exposed, and it’s here where a new mind-set – one that keeps consumers top-of-mind and favors stakeholders over shareholders – is already visible.

And just as soldiers are known by the things that they carry, so, too, are finance professionals known by the metrics that they wield – and at Levi’s, these metrics are increasingly consumer-driven.

Explains Singh: “As the pivot to the consumer mind-set happens, the metrics that have become critical are: How many new customers are we signing up? What is the repeat rate of the customer? And, What is the lifetime customer value?"

When CFO Tania Secor looks back at the early years of her finance career, she can’t help but revisit her decision to accept a position with the McGraw-Hill Companies.

For a half-dozen years, Secor had been entrenched in the private equity world, advising portfolio companies on different growth strategies and helping to complete the acquisition of a string of middle-market firms. Her new role at McGraw-Hill would not only leverage her M&A experience but also situate her within the corporate finance rank-and-file, where she grew accustomed to the cadence of tasks performed by the finance function.

“I had never done a forecast myself, and I had never been through a rigorous budgeting and planning process at a $10 billion company,” explains Secor, who over the next 8 years would advance into a number of different FP&A roles before being named CFO of the magazine Businessweek, a role that would lead her to become part of a future transaction.

“I came back from maternity leave and was asked to work with the leadership team to sell Businessweek,” recalls Secor, who would remain CFO of the media property after it was acquired by Bloomberg LLP.

“During the transition, we had to rip our GL out of McGraw-Hill and put it into Bloomberg—and this had to have been one of the most challenging times of my career,” comments Secor, who notes that as the deal neared completion, her finance team lost its controller, which injected even more stress into the transition period.  

Looking back, Secor says that she wouldn’t want to relive the experience. At the same time, though, she leaves little doubt that ultimately it was the Businessweek transaction that allowed her to plant both feet on the CFO path. –Jack Sweeney 

CFOTL: Tell us about R/GA … what type of company is this, what does it do, and what are its offerings today?

Secor: R/GA is a digital innovation agency. We design businesses and brands for a more human future. This means that we engage strategists, technologists, creative people, and producers to develop campaigns, websites, mobile applications—any type of digital experience—for our clients, which include world-leading companies like Google, Samsung, Verizon, Nike, and 200 other firms for which we create these digital innovation experiences. We have 14 offices across the world and about 2,000 employees. We are a division of The Interpublic Group of Companies.

Interpublic Group has a large portfolio of different types of agencies and PR firms. The niche into which we fall is not necessarily media buying and planning—which is “media brands”—and it doesn’t necessarily have anything to do with big standard campaigns for some of what you might consider to be traditional clients. Where we come in is in working with brands that are more innovative or want to complement their campaigns with some more innovative solutions. You might see an R/GA-developed TikTok campaign where the influencer on TikTok is actually engaging with you. We may have used volume capture to take an influencer and create a beautiful digital art campaign that turns into a commercial or a website design or a mobile app. Our services and capabilities run the gamut of the more innovative creative types of digital experiences.