Monday, September 16, 2019

Lesson learned: 'Watch your balance sheet like a hawk,' CFO says


Source: 
https://tinyurl.com/y3hsl86z

Amplify Credit Union's CFO John Orton argues your income statement won't give you the heads-up you need when sales drop and debt service obligations start to mount.

In the aftermath of the September 11 attacks, John Orton's fast-growing business took a nose-dive.

He was part owner of a private equity-backed company that was going around the country acquiring antique malls and using increased sales to service its expanding debt load. But consumer interest in antiques, a discretionary purchase that tends to do well when people are feeling upbeat and confident, waned in the uncertain and fearful environment that followed the attacks and pushed his company into bankruptcy.

But Orton, the long-time CFO of Amplify Credit Union in Austin, Texas, learned a lesson from his earlier company’s struggles. That lesson has helped him be a better finance executive, he believes.


“We thought we were on a trajectory for an IPO at some point when roll-ups were a little more in vogue,” he said in a CFO Thought Leader podcast last week. “Aside from the national tragedy, we saw in the months after 9/11 our sales fall by half. We had leases going up. We had debt payments due on our mergers. So, it put our business into a tailspin. The world went from rose-colored glasses to a chapter 11 filing within four years.”

His mistake, Orton said, was his focus on the income statement almost to the exclusion of everything else. What he should have been focusing on just as much was the balance sheet, because that would have alerted him to trouble down the road in the event of a fall in sales.

“We were very focused on delivering income, and EBITDA, and sales growth, and consummating mergers to keep our venture capital partners happy, grow the business, and try to get bought out or go to an IPO,” he said.

“So, the way we looked at the balance sheet was an afterthought. What snuck up on us was, as we were going past 2001 and into 2002 and 2003, we had a lot of debt service coming due on acquisitions that we’d done in the years prior, and so that, plus a 12% yield to our VC investors, really created a situation where we had a high fixed-cost business.”

Orton said that, had he been more forward-looking, he would have seen his debt service doubling and tripling over the following few years and that was unsustainable in all but the most optimistic scenarios.

“You have to watch your balance sheet like a hawk, and not just your current commitments,” he said. “If I had been more forward-looking, I would have seen in 2002 and 2003 that my debt service was going to double or triple. I think we were under the illusion that, as the business continued to grow and succeed, all the debt service would be taken care of by sales growth, and when that didn’t materialize ... wow, we were upside-down in a hurry.”

Orton said the company emerged from Chapter 11 bankruptcy protection in a relatively good position, in part because of the company's decision to be open about all aspects of the process. “It took about nine months to get through that,” Orton said. “Only about 20% of companies that enter Chapter 11 successfully exit. I actually went around to our different sites, put on roadshows with our employees and key customers right after the filing, and provided monthly updates to them. I think that open line of communication kept a lot of key customers from leaving.”


Early lesson in accountability


Orton credited his appreciation for openness to two negative experiences he had when he first started out in business in the early 1980s. In an early job out of college, at Arthur Andersen, where he worked as a COBOL computer coder, his manager was so frustrated with his performance he threw a book at him and walked out. “It was about 11:30 at night and we were the last two people there,” he said.

In his next job, this time working in the finance department, the company, saddled with a massive inventory problem, instituted widespread layoffs in a heavy-handed way that left a sour taste in employees’ mouths. “No notice, no severance, no nothing,” he said. “It made me realize you can be successful in business without being a jerk.”

Orton says he tries to make openness a characteristic of everything he does and he thinks it’s been a major part of any success he’s had over the years.

At Amplify, when Orton came on board, around 2006, the company had about $300 million in assets. Today, it’s at $1 billion, making it one of the larger credit unions in the country.

During that time, the company has shifted, as most financial institutions have, from a bricks-and-mortar focus to an online and mobile focus.

“It’s been a very digital-first approach for us,” he said. “Boring banks and credit unions by necessity are having to become much more technically oriented.”

He said he works with Salesforce on its CMS, a company called Fiserv on its core banking applications, and a company called Q2 on its mobile applications — this last one a must to stay relevant to millennials. “You can check your deposit balances, your loan application, and you can even do a loan application on a mobile device and we can push notices to you if your account balances get below a certain level,” he said.

Amplify had some 90 applications tied to its core system when he started and now the goal is to whittle that down to about 30 so it’s more manageable, better integrated, and easier for everyone to learn.

“We used to take more of a best-of-breed approach no matter what the application was but then you end up with IT systems that are pretty unwieldy,” he said. “That is a lot of vendors to manage, a lot of training for new employees. We decided that, an application that meets 80% to 90% of need, but maybe slightly short of best-in-breed, but integrates better, is just a better long-term solution for us, easier to manage, probably lower cost, and hopefully, since it’s integrated, easier to use for our customers.”

His role in this process has been to review and negotiate contracts with the vendors, and then track whether the technology is having the results the executive team wanted.

“I’m known as the accountability guy that looks back at ROIs on investments and says, ‘Well, did we achieve the customer growth that we expected to see? Did we see the loan or deposit growth? The increase in service offerings? The number of products per household?' So, I’m the guy who follows behind these investment projects to make sure we’re getting the results we expected, and if not, I want to know where we got off track and what we can do to deliver the investment returns we were expecting.”

The company is hoping the technology will enable it to keep competing even as its competition changes. In addition to other credit unions and community banks, it’s competing against newer online players, like Ally and Marcus.

“A lot of our customers are looking at our rates and looking at those [online players] and in some cases saying, ‘Can you match what I can get at Ally for this two-year CD?’” he said. 


A role for RPA

Going forward, robotic process automation (RPA) is expected to play an increasing role in his company. He’s using it to automate repetitive accounting and finance tasks.

“In the accounting world, we’ve all done reconciliation at some point in our careers and it’s a pretty mundane, low value-add task,” he said, “but you can now — and we’re doing this at Amplify — deploy software that will take sets of numbers and look for commonalities and reconcile the deviations and then at the end of the process, if they can’t perfectly reconcile the account, it’ll spit out the open items to be reconciled, and then you can add human value at the end. So, I see a lot of potential for us.”

The next deployment for RPA will be in loan application processing. “We can have software scan loan apps and summarize information and be given an initial recommendation on a loan,” he said. “And then we would have a loan officer look at that, and if everything looks good, check the box, and the loan is approved for funding. So I think in our industry and certainly others, RPA is going to play an increasing role and to me that’s exciting.”

One bit of advice Orton had for young finance executives is to get out of their comfort zone and get training in communications, including public speaking, because as much as finance skills are important, so is being able to tell the story of the company, because that’s what builds trust.

“As finance people, we tend to be introverted, but it’s important to be good communicators,” he said.

Saturday, September 14, 2019

30 Simple Ways to Increase Your Profits





Which of these 30 simple ideas to increase your bottom-line profits can you apply right now?

By David FinkelAuthor, 'The Freedom Formula: How to Succeed in Business Without Sacrificing Your Family, Health, or Life


When you give lots of keynotes or public talks to business owner and entrepreneurial groups like I do you get hit with the same questions over and over.

One of the most common questions I get is, "How do I increase my profitability?"

It's a great question. Here in one list are 30 simple strategies to increase your profits and profit margin. I've already "field tested" these ideas in my work with my company's business coaching clients over the past decade. They work, if you put them into practice.


Here we go...


1) Increase pricing. Bar none this is the easiest answer for many small companies, especially those who have been in business for a while. Most businesses set their prices when their business was first launched, and since they were so hungry for business, they set pricing levels low. Over time, the business likely only made nominal increases to pricing every few years, but rarely did the owner ever sit down and fundamentally rethink his or her pricing model. If it's been over a year, time to look at it again.

2) Redesign workflows and systems for greater efficiency. Cut steps, reorder processes, reengineering physical workspaces, etc.

3) Eliminate tasks and activities that don't add value to the company or customer. Every dollar you save by eliminating the cost of things that don't add value to your company or to your customer drops directly to your bottom line.

4) Give your team a clearer picture on ways they can contribute to profitability. Every team member is an agent to increase profitability. Empower them to be part of this search for ways to increase profitability.

5) Regularly review your administrative and operational staff levels closely. Most service and administrative departments can be cut by 1 in 4 with no impact on quality of work. Many can handle 1 in 3 cut with no significant negative impact.

6) Look for ways to increase value to clients and customers
. This will help you shorten your sales cycle, increase your closing rate, lengthen your client retention, and perhaps, increase pricing.

7) Increase the dollar value of every purchase transaction with your clients. Think up-sell, cross-sell, and resell... Ask, "How can I get each customer transaction to be for a larger dollar amount?"

8) Beware the steep cost of attrition. Customer retention is a strategic expense if spent wisely. How can you increase your customer retention?

9) Feed your winners; starve your losers. This includes with your marketing activities, your sales force, your general staff, your company initiatives, your reporting, etc. So cut your losers, and feed a portion of the saved time and money into your winners. This will greatly boost your profitability.

10) Feed your winning sales people more leads (even if that means you starve your lower performing sales people of leads.) Audit the "$ value per company generated lead given to a sales person." This is not a time to be "fair", but to be strategic. Be transparent about this and let it be a spark to help Fred learn how to increase his own dollar value per company lead given to him.

11) Renegotiate with your landlord. You'll never get what you don't ask for. Create clear options for other space you could lease and have a heart to heart with your landlord about reducing your lease rate. Even if they say no you can always give them a fallback request to give you an option to extend your lease without an increase in rent.

12)Focus your best efforts, talent, and attention on selling your most profitable products, services, customers, niches, or channels. 

13) Strategically map out a pathway to upgrade your top 10-20 percent of clients to "red carpet" or "highest value" offerings.
They want this service, will value this service, and will pay for this service.

14) Look for ways to bundle products and or services so that you increase the average ticket price of every sale. 

15) Sell your product or service in larger purchase sizes.
This could mean that rather than sell a 10 hour package of time you sell in 20 or 50 hour sizes. Think about this as selling a bigger box of your product or service.

16) Strategically consider giving pricing or other incentives to make the purchase and use of your product or service in larger unit sizes compelling. 

17) Strategically map out systems to help your customer consume your product or service faster so that they get more value and hence repurchase more frequently. Look for ways to educate them on the ideal use of your product or service.

18) Make buying from your easy and simple. Reduce barriers to entry. Reduce frustrations or hurdles to re-purchase.

19)Shift a cost from a fixed to a variable expense to give yourself greater flexibility. This is a way to protect your cash flow. It is extremely important for unproven tactics and strategies. For example, pay per sale versus a guaranteed amount for an outside sales person.

20) Shift a cost from a variable to a fixed where the value is proven. Make this shift only when you can negotiate a substantial price savings by doing so.

21) Consistently look for ways to lower your fixed overhead.
Scrutinize your base expenses to eliminate non-strategic expenses that just don't add value to the company or to the customer.

22) Stabilize your production systems so that you can reduce need to stock as much inventory and raw materials which are a drag on your cash flow and on your gross profit margins. 

23) Consider buying "off-the-shelf" versus designing or developing a tool (e.g. software, machine, etc.) from scratch. Unless you are in the business of designing exactly those types of tools you'll almost always find your estimates of the cost to build from scratch are hundreds of percent too low. Plus, you won't have the install base to update that tool, for example with later software releases, at a cost anywhere as close to a third party company who can amortize these ongoing waves of new versions over a much larger user base.

24) Negotiate hard. Take the time to plan out your negotiation strategically. Create competition for your dollars. Create a list of concessions you want, with extras for you to trade off. Research the market to better understand the best deal you can expect. Even hire an experienced negotiator to help you make the purchase on the best price and terms you can. If the asset you're buying for your business is large enough, the ROI on your negotiation work can be immense.

25) Specifically -- negotiate and get competitive pricing on your merchant accounts. This one tactic will likely yield an extra .25-.5 percent to your bottom line with very little effort. (Think of what this means. If you have a 15 percent operating profit margin, an .25-.5 percent increase to your dollars of profit is the equivalent to selling 1.67-3.33 percent more. What does this really mean? If you have $10 million in annual sales with a 15 percent operating profit margin, then a .5 percent decrease in your merchant account fees adds the same profit to your bottom line as selling an additional $330,000! Not bad for what will likely take your controller 10-15 hours of her time to negotiate.)

26) Beware "hidden" R & D costs for pet projects and bright shiny opportunities that don't match up with your company's strategic plan. 

27) R & D is not just a tech or pharmaceutical company line item.
If you work on new ways to create a product or service that you will one day, "down the road" sell to the market, YOU have R & D. Be strategic about where you invest your company's dollars.

28) Get clear on all the costs of inventory: cost of capital; storage; insurance; etc. This will help you make informed stocking levels.

29) Consider selling off or writing off old inventory. Why pay to store stuff you really don't have a use for. Free up the space and cash tied up in that old inventory. Sell it; donate it; scrape it.

30) Set optimal inventory levels and stick to them.
Constantly be on the lookout for ways to safely reduce your inventory levels.



There you have 30 simple ways to increase your business's profitability.

Friday, September 13, 2019

5 signs you're about to run out of cash



Source: https://tinyurl.com/yybbcv5u

Cash is surprisingly hard to track, and knowing when it's about to run out is harder if you don't know the warning signs.

Given how important managing cash is to companies, it’s surprisingly hard to get visibility into one's cash position, and also to know when a cash crunch is looming, a treasury consultant said in a webinar on Tuesday.

Particularly for companies with operations in multiple states or countries, just getting a handle on your cash balance isn’t easy because of time and other constraints, Kenneth Fick, director of strategy and transformation for MorganFranklin Consulting, said in the CFO.com webinar.


A surprising number of companies don’t use any kind of treasury management system (TMS) to manage their cash, which means the treasurer or a finance analyst has to manually log into each bank portal, access the accounts, and download a CVS or other type of file to input data into a consolidating master spreadsheet, typically in Excel, to come up with the company’s position, a process that can eat up a lot of time and also introduce manual keying errors.

“Simply knowing what cash you have at the beginning of the day generally can take anywhere from two to six hours, so you’re spending half your day on a Monday, Tuesday or Wednesday just trying to figure out what cash you have,” he said.

One company he’s working with hasn’t been able to get any visibility into the cash it has through a subsidiary in India, creating what he calls a cash “black hole” in its corporate-level accounting. “They know [the accounts] exist,” he said. “What cash is there? Can it be repatriated? Is it just sitting in a non-interest-bearing account? They just can’t access it.”

That company's black-hole situation is unique. For more everyday situations, Fick recommended using a treasury management system because it gives you a way to consolidate your accounts into a single application. Most of the systems are on SaaS-based platforms.

“What they do is minimize these efficiency challenges and provide connectivity directly to the banks,” he said.
Signs point to problems

Fick walked through five early warning signs your cash flow is in trouble.

1. Not having a quarterly cash forecast
Companies that haven’t created a model for forecasting cash that's separate from the other modeling your financial planning and analysis (FP&A) team does are setting themselves up for problems, he said.

“A lot of time your FP&A team models your balance sheet, P&L, and financial statement over 12, 18, and 24 months for planning, but they fail to take it the next step in regards to the cash component,” he said. “They don’t see [where cash is] at 13 weeks. There’s nothing magical about that. It’s just one quarter out, but it gives you that visibility in the short- to intermediate-term regarding

what will come in and go out based on your assumptions in your model.”

2. Not knowing your cash break-even point


The break-even point is the amount of cash you need on a monthly basis to meet your expenses based on your monthly revenue, and if you don’t have a handle on this, you risk coming up short at crucial times.

“If my revenue is $250,000, I know that, in order to make payroll and other expenses, generally, on average, I need about $150,000 to $180,000 in cash per month,” he said. “So, I know if it goes below that, I have to get it from somewhere: a line of credit, cash on hand, whatever. What if you’re a seasonal business? If you sell Christmas ornaments, you get a gigantic windfall in the fourth quarter and you’re cash-flow negative throughout the rest of the year. So you have to understand where that break-even point is.”

Fick said you should take it as an ominous sign if your company resorts to discounting just to get money in the door to meet your monthly expenses. “ A lot of times I’m seeing, ‘Well, I have all this accounts receivable, but I don’t have enough cash.’ If you’re starting to discount because of the cash impact to get revenue in the door, that’s a big warning sign.”

3. Use of long-term debt

There’s nothing inherently wrong with using long-term debt to cover short-term costs if it’s part of a plan for, say, ramping up operations quickly, but if there’s no strategy behind it, it’s a sign cash has become a problem, he said.

“If you’re seeing a company take out long-term debt just to meet short-term expenses, that’s a warning sign because short-term expenses can become long-term very quickly,” he said. “When you’re in that position, it’s best to cut costs than to borrow.”

4. Tax payment delays


No one likes to pay the IRS, but asking for delays because you don’t have the cash is a sign that you haven’t managed liquidity well, which will cost you more in the long run. “Especially for smaller businesses, the IRS will just beat you to death,” he said. 

5. Too-fast growth

Fick also said growing too fast can be a warning sign, because it can point to a misalignment between your accounts receivable and your accounts payable.

“So, you’re selling to Walmart or Target and they require you give them 90-day terms,” he said. “They’re the big players. If they say 90 days, it’s really 100 or 115 by the time they cut the check or run the automated clearing house (ACH) or whatever. What your vendors require of you are 30-day payments, and you have no power over them. So, you have to basically float that difference for 90 days. If you’re having trouble with that collection process, that is another big warning sign.”
Best practices

Fick suggested five best practices for effective management of your cash.

1. Communication

It’s imperative that finance executives communicate their forecasts accurately, because miscommunication can lead to decisions that don’t match what’s happening. The company “might borrow more that it needs to meet conditions that don’t materialize or they can leave funds unnecessarily idle, which I see very often, actually,” he said. "Communication is the best way to avoid a liquidity crisis. You always want to forecast [business] drivers, not the number. Effective communication is a best practice regardless of the [market] environment.” 

2. Cash flow vs. revenue

Cash flow and revenue both indicate your company's financial health, but revenue is about the effectiveness of sales and marketing, while cash flow is a function of liquidity or money management. Fick said cash flow can be negative, but revenue really can’t be unless there’s something very wrong with the company. To measure cash flow, don’t forget to include money that comes in through other channels separate from the sale of your core product or service.

“Companies obtain cash in a variety of ways outside their main business,” he said, including “interest, warranty fees, other fee income — even SaaS has a set-up fee — one-off projects for professional services like fixing things.”

3. Inflows vs. outflows

Fick said you should identify all sources of inflows and outflows and then work to maximize inflows while minimizing outflows, and to a large extent that means focusing on timing.

“If your customers are asking for 90 days and your vendors are asking for 30 and you have no power over your suppliers, that’s an issue,” he said. “You can use things like supply chain financing (SCF) to ask your vendors to give you longer terms. Maximize timing, extend your payment terms, understand your control of them.”

4. Scenario planning


Creating scenarios in the FP&A function is common, but it should be done for cash, too, he said.

“What scenarios do, especially for cash, is they provide a playbook for you. What ifs,” he said. “Having these ifs before they happen helps you think through and build that playbook, so if it does happen, you’re executing and not thinking.”

Tariffs provide a good example. “Tariffs affect the P&L but they also affect cash and future business.”

5. Variance analyses

Fick recommended you set tolerances for what you can accept when actuals come in at a variance from your projections. If you set a tolerance of, say, 5%, you're prepared to take action once you hit that difference from your projection.

“There might be customers who fail to pay,” he said. “Sales don’t materialize, you see unexpected expenses, you have to understand and analyze those in the short-, mid-, and long- term. Nothing is set in stone.”

Despite its importance, cash can be a challenge to manage. But by knowing some of the warning signs and following best practices, you can help protect your company from that gravest of all ills: not being able to meet your company costs because you’ve run out of money.

Wednesday, September 11, 2019

CFOs too busy to take on more despite expectations, survey finds




Dive Brief:

  • Almost 40% of CFOs say they're juggling too many tasks — 12 a day, on average — to worry about digitally transforming their operations or giving cybersecurity the attention it deserves, a survey released Monday found.
  • Cash flow management, data analysis, hiring and other traditional duties are among the biggest concerns of financial leaders, far more than implementing the latest tech or security innovations, the survey of 166 CFOs across 23 industries showed. The survey was conducted by NetSuite research affiliate Brainyard.
  • "We have to compartmentalize," Drew Cook, CFO of Pact, a fair-trade apparel company, told CFO Dive. "Whether we like it or not, we have to always be thinking about cash flow and the need for capital. Cybersecurity and [other digital priorities] keep us up at night, but these things aren't what drive long-term value."

Dive Insight:

The Brainyard survey found most CFOs — almost half — have not yet invested in cutting-edge technologies such as blockchain, artificial intelligence, cryptocurrency or the Internet of Things (IoS).

CFOs think their corporate culture isn't ready for these changes or they're not sure the investment, at this point, is worth it, the report said. They're also not sure their legacy systems can adapt to the newer technologies.

In contrast, most say their priorities over the next two years involve improving performance of their traditional duties. 55% say they want better and faster reporting, and 50% say they want to speed revenue growth. Only about one-third say implementing new technology is a priority.

Cybersecurity is also not a priority. Almost 55% of CFOs say their company has no full-time cybersecurity staff, and another 7% say they don't have staff but plan to change that soon.

Cook's company has basic protections in place, he told CFO Dive. But beyond that, he relies on third-party vendors.

"You have to get security right," he said. "Part of doing that is having dependable partners."

He said it's reassuring to work with a specialist who is able to keep up on the latest developments in cybersecurity in a way a CFO can't. "It helps knowing they're doing it with other companies across the country," he said. "It helps to ensure you're state of the art, cutting edge."

Cook said the trend of CFOs being asked to take on more tasks stems from a growing realization among CEOs and boards that the analytical approach finance people take to management is useful across the enterprise.

"Whether it's marketing or HR or legal, the analytical mindset can be beneficial across the board," he said. "So the CFO is being asked to play a larger role in the organization."

The downside of that, though, as the survey results show, is that CFOs are finding it hard to combine the new tasks with the old. But Cook said the solution is to work with third-party vendors, rather than to push the new tasks to the bottom of the pile — not just for security but for other functions.

"Outsourcing is one way to do more with fewer resources," he said. "We outsource a lot of things, including fulfillment. We're all being encouraged to do more with less."

Top 3 things for a thriving business (with Soledad Tanner)

Facebook live: Business Finances with Soledad Tanner from Soledad Tanner Consulting LLC, hosted by Carina López - Latina Power series hosted Power on Heels Fund, Inc.

Tuesday, September 10, 2019

Consulting background prepares CFO for any industry


Source: https://tinyurl.com/yyqo72va

By working with multinational companies, a CFO was able to increase cash flow and improve forecasting at a tech company despite never working in that sector before.

After working for a waste treatment company and a Chilean multinational winery, Horacio Yenaropulos moved into technology in 2017 when he became CFO of Argentina-based Belatrix Software, which develops digital applications for companies. The 25-year veteran in finance said his move into the tech sector was relatively seamless thanks to the training he received during his 14 years consulting at PricewaterhouseCoopers.

"When you work after many years in a consulting firm, you can work in any type of industry," Yenaropulos said last week in a CFO Thought Leader podcast. "At PwC, I worked with several types of industries, and then I moved to a winery, and then I came back to Argentina and I had a chance to join Belatrix. It's the first time I had the chance to work directly in a technological environment, and with a highly regarded, high-growth Latin American software company."

Yenaropulos received his bachelor's degree in accounting in Argentina and his MBA from the University of Pittsburgh. While still an undergraduate, he joined the auditing division of PwC in Mendoza. After obtaining his MBA, he returned to PwC, this time to its Buenos Aires office to work on the advisory side with multinational companies.

"I was in charge of valuing firms, doing due diligence, [mergers and acquisitions] practice, so it was a different type of work, and much more challenging," he said.
Strategic approach

Yenaropulos said it's crucial for CFOs today not to rely entirely on their finance and accounting training, but instead to think creatively, and be prepared to adapt because of the pace of change in business. "Creativity and resilience are the new values of the modern CFO," he said.

At Belatrix, his first task was to unify the company's five accounting systems — each a legacy product of its operations in Argentina, Peru, Colombia, the U.S. and Spain — into a single tool. He brought the systems together over the course of two years using SAP Business One. When the conversion was complete, the finance team was able to give company executives a monthly financial package in addition to a quarterly report, helping them in their decision-making.

"It was clear from the outset I needed to help the owners with the transformation from being a family-owned company into a world-class, multinational one," he said. "It was really world class on the delivery side of products and services, but there was a lot of room to improve the finance side.

"The other challenge was that my team was based in several locations, which, based on distance and cultural challenges, was a decision that also needed to be addressed," he added.

At Hidronor Chile, a water treatment company for which he was hired as CFO in his first non-consulting job, he replaced the company's manual revenue recognition processes with software-assisted processes that cut in half the time it took to settle accounts receivable.

"By implementing a sizable reduction, in days, of our accounts receivable, we were able to generate impressive positive cash flow for the company," he said. "Imagine if a company was not able to invoice for services to the client until it had finished the identification of the waste and its subsequent treatment. So, what we did is, we created a team with the operations people, commercial people and the technology department. We proposed and successfully implemented a plan that reduced the days of account receivables from over 200 days to just 90 days in only one year. This was achieved due to changes in the processes from the client side, from the operations side, and by adding new software abilities to the process."

For Yenaropulos, the main takeaway is to stay flexible and to respond to new situations, just as you would as a business consultant.


"The challenges today are dealing with limited resources and a very risky and competitive environment," he said. "We must realize the requirements change on a daily basis, and each day will bring new challenges. We will need to constantly improve our creative ability to be able to provide answers at the same pace that constant change requires."

That's especially important for CFOs of companies in parts of the world not used to competing head-to-head with giant, well-established global companies. "When you come from Latin American countries ... change and the ability to adapt is a key requirement for a local company to survive," he said. "I can really confirm that these attributes provide a huge competitive advantage for us as CFOs."

Sunday, September 8, 2019

CEOs Are Redefining the Role of Business in the World

Source: https://tinyurl.com/yy5t256l

By Arianna Huffington, Thrive Global Founder & CEO

From left to right: Jamie Dimon, JPMorgan Chase Chairman & CEO; Ginni Rometty, IBM Chairman, President & CEO; Alex Gorsky, Johnson & Johnson Chairman & CEO (Photography: Getty Images)

Because capitalism has to work for everyone — not just shareholders.

This week marked a milestone for business. The Business Roundtable, an association of nearly 200 American CEOs, issued its “Statement on the Purpose of a Corporation,” a pledge to deliver value not just to shareholders, but to all stakeholders — and in doing so, to fundamentally shift the role of business in the world.

This isn’t some small-ball, better business initiative. It’s the chiefs of JPMorgan Chase, Johnson & Johnson, IBM, General Motors and many more creating a new blueprint for the future of capitalism. It’s a collective rejection of one model — Milton Friedman’s declaration of profit as the only responsibility of business — and the embrace of another. As Jamie Dimon, the Roundtable’s chairman, put it, “The American Dream is alive, but fraying. Major employers are investing in their workers and communities because they know it is the only way to be successful over the long-term.”

This new model gives us a glimpse of a future where businesses can be the greatest platform for social change — while still continuing to grow, innovate and compete. It includes:

*Delivering value to our customers.
*Investing in our employees.
*Dealing fairly and ethically with our suppliers.
*Supporting the communities in which we work.
*Generating long-term value for shareholders.

It’s the culmination of a movement that has been gaining steam for some time. In 2013, Richard Branson launched The B Team with the mission to change the values that drive businesses and to move beyond the obsession with quarterly earnings and short-term growth. I’ve learned a lot by being on the B Team’s board since the beginning, and by joining the board of JUST Capital, which Paul Tudor Jones founded to build a more just marketplace that reflects people’s true priorities.

And now, at a time of wavering trust in capitalism, when 64 percent of Americans say a company’s primary purpose should include “making the world better,” our leaders have understood the need to act. JUST Capital reports that “over the last five years our polling has showed that regardless of age, political affiliation, income, ethnicity, or gender, people want companies to stop prioritizing shareholders and start sharing success with all stakeholders.” The Roundtable’s commitment is the culmination of Alan Murray’s observation that “in the past few years, it has become clear that something fundamental and profound has changed in the way CEOs approach their jobs.”

For far too long, we’ve operated on the belief that businesses must single-mindedly pursue profit, consequences be damned. We’ve watched as this approach has left individuals and communities behind, turned a blind eye to unfair and unethical practices, harmed the planet and created a global epidemic of stress and burnout.

This week’s news puts us on a new and better path. It acknowledges the reality that profit and purpose are not in opposition, but rise together. The CEOs have spoken. Now, it’s on them to turn those words into action.


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.— Published on August 23, 2019