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680: Making Sales Success a Must-See Metric | Ron Knutson, CFO, Lawson Products Mar 07, 2021

Show notes

A little more than a decade ago, Ron Knutson remembers, when he first stepped into the CFO role at Lawson Products, he quickly realized that the productivity improvements that he was expected to help drive would demand a number of significant infrastructure and technology investments.

In anticipation of the investments that would need to be made, Knutson recalls, he first completed a “competency review” for every member of the finance team, a process that was in part designed to help flag those employees deemed well suited for training tied to future investments.

“We wanted to make certain that we would be training the right individuals,” comments Knutson, who notes that the review ultimately led to “extensive” staffing changes as he sought to lessen the team’s overall dependence on existing systems and use new training to whet its appetite for the adoption and implementation of new technologies, including ERP software.

“Having these individuals go through the implementation process just made them so much stronger coming out of it,” explains Knutson, who credits the new technologies with—among other things—helping the sales team to monitor and interpret customer engagement patterns.

Meanwhile, some of the biggest gains from Lawson’s technology investments may have been occurring inside their system of warehouses, or distribution centers (DCs).

In addition to consolidating the number of DCs from eight to five, Knutson reports, the distributor also significantly lessened excess inventory through the adoption of a demand-forecasting tool that uses historical customer demand patterns to provide Lawson with regular inventory management insights.

Adds Knutson: “We had quite a bit of working capital tied up in inventory, but now we are able to make the right investments in our high-turning items as well as our slow-turning ones.” –Jack Sweeney

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679: Making a Business Ripe for Investors | Graham Miao, CFO, AgroFresh Mar 03, 2021

Show notes

Looking back, AgroFresh CFO Graham Miao says that the decision to change careers early in his professional life was triggered more or less by resource allocation.

Originally, Miao had trained as a biologist, but after having earned a doctoral degree in biology from Columbia University, he quickly found gainful employment as a scientist at a research facility run by pharmaceutical giant Roche.

It was here amidst the daily pursuit of biological insights that Miao began to observe how finance and accounting professionals held sway over many of the resources needed to complete different projects.

“It made you wonder, ‘What is it that accountants know about science that scientists don’t?,’” explains Miao, who after 5 years with Roche returned to Columbia to study business full-time.

“At the time, my boss and colleagues thought that I was being crazy and that it was too risky,” remarks Miao, who notes that the pursuit of yet another degree required that he take out a student loan.

Next, Miao joined JPMorgan, where he worked in equity research and served investment banking clients that were looking to better communicate the “equity story” to investors.

“The pace of the job was completely different from what I was used to as a scientist,” comments Miao, who adds that the discussions he found himself having as an investment banker further revealed to him the breadth of finance’s influence and boosted his confidence in having made the right decision. –Jack Sweeney

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678: The Arc of Data's Evolution | Ed Goldfinger, CFO, Quantum Metric Feb 28, 2021

Show notes

When Ed Goldfinger is asked to relate a moment of strategic insight that he has experienced as a finance leader, he draws our attention to his CFO tenure at Zipcar, the car-sharing upstart that targets the short-term needs of its customers by being billable by the hour as well as the minute.

At Zipcar, Goldfinger would achieve the fabled CFO milestone of taking a company public. However, the biggest takeaways for him were related to the experience of growing a company widely recognized as an industry disrupter—and thus member of a cohort known as much for innovation in business modeling as for often startling deficiencies in benchmarking data.

“You couldn’t point to any existing player and say that this was what we should look like over time,” explains Goldfinger, who notes that Zipcar grew from roughly $55 million to $300 million in annual sales during his term as CFO, a 6-year tenure that ended with the sale of Zipcar to Avis Budget Group in 2013.

Among the more sizable obstacles that Zipcar’s finance team faced was the lopsided rental habits of its weekly customers.

“There were probably 50 percent more rentals on the weekend than on weekdays,” comments Goldfinger, who reports that the spike in customer demand on weekends burdened Zipcar with growing numbers of dormant vehicles on weekdays.

He continues: “I invented a metric that we called ‘weekality,’ which was simply weekend usage over weekday usage, with the goal being to lower it.”

What’s more, Goldfinger says, the company introduced incentives to make overnight rentals more appealing to weekday customers and at the same time launched a “big push” into the business rental market by using promotions specially designed to attract weekday corporate customers.

Still, Goldfinger admits that few incentives were more effective than pricing when it came to striking a weekday/weekend balance: “We charged a lot more on weekends on a per-day basis because there was just no way that we could hit our revenue-per-car numbers if we didn’t achieve a better balance during the course of the week.” –Jack Sweeney

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677: Engaging Minds at Work | Michael Pickrum, CFO, ExecOnline Feb 24, 2021

Show notes

When Michael Pickrum tells us about ExecOnline, the company that he joined as CFO back in 2019, he wants us to know that the education technology firm is aligned with his goals both professionally and personally.

When it comes to the professional side of things, Pickrum says, ExecOnline in certain ways is a media company.

“You’re taking some IP and figuring out how to distribute and monetize it,” comments Pickrum, while boiling down the somewhat complex approach that ExecOnline uses to repackage the curricula of top business schools and universities to better serve the specific people development needs of a variety of corporate clients.

Still, Pickrum’s shorthand description is intended not to spotlight the facets of ExecOnline’s business model but instead to draw our attention to its similarities with his past media industry experience—such as his 17 years with BET Networks, where he occupied the CFO office for 9 of them.

As for the personal side of things, Pickrum says that he is a “big believer” when it comes to the transformative power of education.

“I went to public schools growing up—I was very fortunate to go to a great university, and it changed my life,” remarks Pickrum, who adds that ExecOnline packages the academic IP not with aspiring college students in mind but with an eye toward first-time managers as well as more senior business leaders.

According to Pickrum, part of the added value that ExecOnline offers corporate clients derives from providing the IP in a more relevant and efficient way.

“Most of our programs are 1 week, 3 weeks, or 6ix weeks,” explains Pickrum, who says that at times the material being covered can be applied to a specific project that the managers are undertaking within their company.

“It’s just a great marriage between the business school’s IP, professors, and resources, and our platform and ability to engage people where they are, which is at work.” –Jack Sweeney

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676: The Next Transformation Journey | Paul Lundstrom, CFO, Flex Feb 21, 2021

Show notes

Back in 2015, after nearly two decades of diligent career-building across United Technologies, Paul Lundstrom fixed his career builder’s gaze upon the span of companies known as the Fortune 500.

Like many seasoned finance executives who spend the balance of their careers inside large enterprise companies, Lundstrom had to confront the obvious truth that for every company, the CFO office has but one occupant.

By all accounts, a Fortune 500 company was a worthy target for Lundstrom’s CFO ambitions, but here, too, the number of CFO roles quickly diminishes when you consider the industry-specific focus that spans the arc of Lundstrom’s career and those of so many others.

Finance executives often tell us that it was here within this realm of heightened ambition and shrinking opportunity that they dared to add one of the most satisfying chapters of their CFO careers, and so it was for Lundstrom.

Last fall, the UT veteran landed safely inside the Fortune 500 world when he was named CFO of Flex, a $24 billion contract manufacturer. However, it was the 4 years between UT and Flex that Lundstrom now points to as constituting one of the most satisfying periods of his career.

Back in 2016, Lundstrom exited UT to accept a CFO position with Aerojet Rocketdyne, a struggling aerospace company that had recently found it necessary to restate its financials.

“This was a $2 billion NASDAQ company that did not have a controller,” explains Lundstrom, whose 4-year tour of duty as Aerojet’s CFO coincided with a rise in the company’s stock price from $16 to $50 per share (pre-COVID).

“The goal was business transformation,” explains Lundstrom, who now characterizes his Aerojet years as a “turnaround” chapter that no doubt put yet another stripe on his CFO career path sleeve. –Jack Sweeney

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Marching in Step with OKRs - A Workplace Champions Episode Feb 19, 2021

Show notes

This Episode Features Human Capital Insights & Commentary from:

Dynshaw Italia, CFO, Soldo

Brad Kinnish, CFO, Aryaka

Will Bondurant, CFO, Castlight Health

The Workplace Champions Podcast explores the innovative workforce practices of talent-minded business leaders tasked with opening a new chapter of growth for their midsize organizations.

More keenly aware of the competitive price of employee burnout and workforce attrition — many midsize companies are today busy rethinking how they attract, hire and inspire employees.

675: When Complexity Equals Waste | Jim Harper, CFO, Goodroot Feb 17, 2021

Show notes

According to Goodroot CFO Jim Harper, the best way to transform the current U.S. healthcare system is to replace its connective tissue.

“It’s going to be a long slog and it’s got to be done one system at a time,” explains Harper, who uses the word “system” while referring to the individual points of connection that knit together healthcare’s patchwork of payers and providers.

For Harper, connection points are where waste gathers within the larger system – and where companies often add unnecessary complexity in order to extract more dollars.

“Because there is so much money flying through the systems there are a lot of organizations that have become involved here and they are greedy,” comments Harper, whose shares his opinion of the healthcare system as a preface to explaining the mission behind Goodroot.

Not exactly a business incubator, and not a private equity firm, Goodroot prefers to be dubbed a “community” of businesses dedicated to improving the current state of healthcare delivery.

Harper once more tells us: It's a mission that can only be achieved "one system at a time." - Jack Sweeney

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674: Creating Sensible Options From Hard Decisions | Robert Linder, CFO, Lazy Dog Restaurant & Bar Feb 14, 2021

Show notes

When CFO Robert Linder highlights what distinguishes the dining experience at Lazy Dog Restaurant & Bar, it’s easy to imagine him as a friendly host escorting us across a lively dining area filled with spirited patrons.

“I love the hospitality industry, and I didn’t always know why—but I love to host and I love the interaction and taking care of someone and helping them to discover something new,” says Linder, whose words draw our attention to the universal splendor of dining out and its bitter absence from our lives during these past many months.

From the start, we knew that our discussion would become focused on the pandemic and its impact on Lazy Dog’s business, yet we couldn’t help but want to linger as Linder listed the popular menu items from the restaurant that currently serves customers at 39 locations in seven states.

In the end, we left it to Lazy Dog’s CFO to transport us back to earth with the not so enviable time of arrival being March 2020.

“It’s hard not to point to something in the past year, given all of what this industry has gone through,” says Linder, when asked to share a moment of strategic insight that he’s experienced during the course of his career.

Looking back, Linder recalls the first 48 hours when shelter-in-place orders were being issued in California and the full magnitude of the decisions that would need to be made began occupying the thoughts of Lazy Dog management.

“We knew that our cash burn rate would be significant, and the thinking was around how we could adjust our costs as quickly as possible in order to survive,” explains Linder, who observes that survival demanded a wide and aggressive workforce reduction but Lazy Dog management remained uncertain about its response and considered whether several waves of layoffs over a period of weeks might permit the business to “buy time” and allow management to revisit the question of layoffs again in the future.

“What we realized was that the outcome that would be most kind to our people was the one that would offer them a job when we came out of the other side of this thing,” comments Linder, who notes that management rejected having several waves of layoffs in favor of one large one.

“This was one of the best decisions that we made because from that time forward we have only delivered good news to our people and have been able to say, ‘Hey, we’re bringing some people back” or “Hey, we’re able to restore a portion of your compensation,’” reports Linder, who adds that Lazy Dog has continued to pay health insurance for those who have been laid off.

Says Linder: “For me, that 48-hour period showed why you can’t run away from a hard decision as a finance leader.” –Jack Sweeney

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673: Advancing Down the Transformation Path | Will Bondurant, CFO, Castlight Health Feb 10, 2021

Show notes

Years from now, when Castlight Health CFO Will Bondurant reflects back on the varied chapters of his finance career, he may title the current one “The Turnaround”—that is, if he and Castlight CEO Maeve O’Meara are able to achieve what the firm’s previous management team had not been able to: a strategy transformation.

Like his CEO, Bondurant is not an outsider: After joining the firm in 2013, he was assigned a variety of strategy and financial planning duties that led to more influential product strategy and operational roles of the type that many aspiring CFOs eagerly seek out.

As Bondurant shared with us his cross-functional journey, he mentioned few titles or promotions but instead drew our attention to a variety of experiences that has led us to conclude that Castlight’s future CFO first emerged as one of the company’s foremost problem-solvers.

Says Bondurant: “If everything is working, you don’t always get the opportunity to fix something. The reason that I was able to have these opportunities is that we had challenges—and from where I sit now, they certainly benefited my own personal development.”

Then, in 2017, came a $135 million acquisition, a transaction that management told investors would transform Castlight but instead ended up leaving a trail of merger snags and glitches that ultimately led to the formation of a new management team.

At the time, Bondurant no doubt may have appeared to certain investors and outsiders to be a dark horse candidate for the firm’s CFO role. Still, it appears likely that his Castlight colleagues viewed things differently.

Having spent many hours with Castlight customers before becoming CFO, Bondurant was familiar with certain external facing aspects of the role, but not all.

“Investor relations was a new area for me—I had been external in my previous roles but principally with customers and partners and the like,” explains Bondurant, who recalls several unpleasant calls with investors after stepping into the CFO role.

“I recall asking myself in the first week, ‘Do these people just hate me? Am I just really disliked by these people?,’” comments Bondurant, who notes that he now enjoys the calls with investors and very often views them as being more productive than his engagements with customers. –Jack Sweeney

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672: Finance From the Top Down | Tom Berquist, CFO, TIBCO Software Feb 07, 2021

Show notes

When an inquisitive software analyst takes a seat across the table from TIBCO Software CFO Tom Berquist, the inquisitor may not know that TIBCO’s finance leader once sat on their side of the table and in certain ways still prefers it.

From 1996 to 2006, Berquist added a distinguished equity research chapter to his career when he became a marquee analyst inside the software realm for a string of Wall Street investment houses—namely, Piper Jaffray, Goldman Sachs, and Citigroup.

Seated across the table from the likes of Oracle’s Larry Ellison, Bill Gates (at the time, Microsoft’s CEO), and many others, Berquist asked probing questions and listened to the carefully crafted narratives designed to achieve “buy-in” on the company’s strategy from discerning analysts.

“You would get pieces of information from each of the different companies, which gives you this incredibly powerful view of the market,” recalls Berquist, who even today seems to envy the analyst he once was.

“The CEOs and CFOs would read your research and then come back and complain and try and explain why you are wrong by supplying you with even more data points—which is helpful because you can then create an even bigger mosaic,” continues Berquist, who ultimately exited software research when he was offered a CFO role at a newly minted company formed from a group of technologies spun out from CA Technologies that was then known as Computer Associates.

“We had to build the finance function from scratch,” remembers Berquist, who quickly set about building processes and hiring finance professionals to lead the company’s different functional groups.

As the finance function grew up around him, Berquist says, he observed firsthand how finance acquires its “bottom up” view of the business organizationally, whereby data is first captured and then finance projects trends according to what’s already happened.

“I’ve found this in every finance function that I’ve encountered since that time, so I view it as a universal truth,” states Berquist, who set out to remedy finance’s traditional “bottom up” approach by applying some “top down” macroeconomic insights.

“I put in processes to run a “top down” model after actually building it myself. I compared and contrasted it to the traditional finance model and we reached common ground, allowing us to get in front of the trends,” says Berquist, who, even today after serving in multiple CFO and CEO roles, can’t help but linger on the other side of the table. –Jack Sweeney

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