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					Chief Financial Officer - CFO

          Brings Logic & Order
    to what would otherwise be Chaos
Evolution in CFO Requirements
Functional Evolution of Finance
Cash


       Language of Finance


                    Business Analysis


                             Business Planning



                                        Business Partner
Role of Finance
• Larger Role: Applying financial skills to the
  broader context of the total business

• Current and future
-as a business partner to general management
Role of Finance
• 1st- The language of Finance provides a
  common denominator
• 2nd- Administers money for company
• 3rd- Minimal role demanded and unavoidable
The Role of Finance
Company Variables
• Type and Size of Business
• Financial Health of Business
• Personalities and Backgrounds of Senior
     Management and Directors
• Speed of Change
The Minimal Roles of Finance
 Demanded & Unavoidable

1st – Administration of Money for Company

2nd – Provide the Language of Finance as a
      Common Denominator
           (Minimal Role of CFO)
The Larger Role of Finance

 • Applying Financial Skills to the Broader
   Context of the Total Business…

            Current & Future
                    as a
 Business Partner to General Management
Mission of Finance
1. To Provide:
  a. Value to Customers
  b. Appropriate Return to Investors
  c. Responsible Environment for Employees and
     Communities


                                       Bakane, CFO
Mission of Finance
2. Operate in Partnership across All Units and
   Functions to Further Corporate Goals
3. Add Perspective and Match the
   Organization’s Needs with Capital Sources
Evolution in CFO Requirements

Accounting Details  Specialists
                            
   Translator             CFO
      of              (not necessarily CPA’s)
   Specialists
  (accounting)               
      for                MBA’s
(Senior Management)
Student


          Start-Up


                     Multi-Billion $ Business
CFO Mgt. Principles are the Same!
• Old or New Economy
• Small or Large
• Domestic or Multinational
• Good or Bad Company
External Demands
  Growing Amount of Required
      Financial Reporting                 (Auditing)
            By Government Agencies (IRS, SEC)
            and Investing Public          (Analysts)

 Strong Technical Knowledge
 Need to Directly Control the Information Released
CEO’s Increasingly Turning to CFO’s
to:
• Influence Decision Making
• Craft Internal and External Strategies
• Communicate to and Help Manage the Board
• Manage other Functions
CEO’s Increasingly Turning to CFO’s
to:
• Help Manage Operating Companies
• Help Corporate Financial Literacy
• Add Economic Value
• Help Manage the CEO
CFO Company Variables
          • Health of Company
     • Personalities and Backgrounds
      of Senior Executives & Directors
    • Type and Complexity of Company
           • Speed of Change
CFO’s Intimate Interactions
• Board of Directors

• Audit Committee
• Compensation Committee
• Executive Committee
Base Organization
               Expanded Organization




  Shared        Strategic   Strategic   Information   Procurement
 Services       Planning    Business    Technology       SCM
                              Unit,
                             CFO’s
 Mergers
Acquisitions
Divestitures
                       Share Holders

                     Board of Directors
 Civic Leaders/                Audit Committee
 Politicians                                     Analysts
                      CEO       COO
 Major Suppliers                          OPCP - Presidents
                            CFO
                            CFO

 Business Partners             Admin.         Corp. Staff

        Employees                          Consultants
                            Finance
                           Employees
Immense Time Consumption
Setting Strategies

• Corporate

• Financial

• Personnel
Tricon – CFO Strategies: Prioritize

1. Reduce Debt/Re-franchise
   –   Get to Investment Grade
2. Staff the H.Q.
3. G&A Reductions  Shared Services
4. Standardize & Integrate Systems for Y2K
5. Create a System Wide Co-Op
6. Help stabilize business
Setting Financial Policies

• Internal Control
• Accounting Policies
• Measurement Standards/Benefits
Setting Financial Policies
• Financial Administration of Business
  – Annual and Long Range Plans
  – Evaluation of Major Expenditures
  – Evaluation of Economic Trends
  – Capital Structure
Setting Personnel Policies
• Hiring, Training, and Development of the
  Finance Function

• Structure and Staffing
CFO’s People Focus
• Structure
• the “Best” Key Personnel
• Working Relationships
• Communications
• Operating Procedures
                                       Corporate Skill Curve
                     Leadership/
                      Political
Skill Requirements



                       Mgmt.


                       Mgmt.



                     Technical



                                   Small/Low                             Large/High

                                               Size/Complexity of Firm
              Functional Skill Curve
Sr. Mgmt.



Middle



Entry



                         Managerial      Political &
            Technical
                            Skills       Leadership
              Skills
                        Multiple Tasks     Skills
                  CFO Career Grid

Corporate

Crossfunctional
International     New Areas
New Co.’s


Manager

Entry

             Audit Acct.   Cost    Planning, Business     Strategic
              Tax          Acct.   Reporting, Analysis,   Planning
                                    Investor Treasury
                                   Relations
CFO as a Business Partner

- Assistant General Manager
Ethics                      Leadership
• Honesty               • Teamwork & Trust
• Promise Keeping       • Diversity
• Fairness              • Recognition
• Respect for Others    • Ethical Management
• Comparison              Practice
  (Social Commitment)   • Communications
• Integrity             • Empowerment

                                       The CFO
CFO Dilemma(s)

• Conflict of Interests


• Credibility


• Integrity
Becoming the CFO


         The Last Hurdle
               To
              CFO
Lessons Learned – C.F.O.
• Importance of Your Team
• Functional Confidant – OM, Kennedy; YUM, Knopf
• The Bigger the Ego, the More Time you Need
  to Manage it
• Succession makes everyone Crazy
L.L. – C.F.O.        II

• Corporate Culture is Important to Understand
  and Manage
  – Almost all are Different


        • Do a Couple of Changes Well.
                          vs.
    Lots of Change with little accomplishment.

				
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posted:11/23/2011
language:English
pages:36