Posts Tagged ‘cfospeak’
Wednesday, April 6th, 2011
Recently, I was reading the newly released IBM paper - “Journey to a value integrator”. What I was very impressed was the importance of people in a continuous journey of transformation in an organization. The report says that:
- Increased productivity and focus on analysis and managing outcomes allow human capital resources to contribute more value to the company
- This aspect can lead to improved job experience, satisfaction and career progression for employees
- This benefits the company with lower attrition rates, a greater ability to attract and retain talent and improved leadership development
The report also states correctly that this does not come automatically and the transformation approach much incorporate new designs for job role, responsibilities, career paths and performance assessment criteria. And a big focus here is on analytical skills development. The new skills in question, should align with the vision for technology, process, analytics and operating model design.
Culture is also a very important part which is often neglected. Today multinational organizations span across continents and hence employees belong to several cultures. Balancing people development in a cross cultural environment is often not an easy task. What is needed is to develop an organization culture to emulate the deep cultural ethos. What results out of this is the very best across cultures. Trust, teamwork, execution focus, continuous improvement, empathy etc. gets built within the organization, which contribute to leadership building within the organization.
I had written an earlier blog in June last year – “Mergers and Acquisition- the human side” http://www.cfospeak.com/2010/06/ where I had referenced an article – “The impact of culture on M&A” by Mercer UK, where I had strongly agreed with them that the valuation of any company is perhaps the people and the culture of that organization. If you lose the people, then perhaps you have walked into an M&A disaster. My esteemed CFO colleague and my linkedin friend – Mr. Subramanian, who was then the VP Finance of Mahindra Satyam had so rightly commented on the that blog that “People are not bonded to organization for just money or incentives. It is also passion, self respect and independence on decision making”. He also says “The value drops to naught if talents and customers go away. It takes quite a time to rebuild. A leader and integrator are two different players and both have to play a role simultaneously so that value is not lost and common goals met”
Hence, my views are:
- Transformation journey is a human resources led journey and hence need to address the critical aspects of development, growth and career satisfaction
- While a transformation journey is measured by new markets acquired, consolidation in existing markets, deeper penetration through product mix, enhancing and securing revenue streams – it also needs to measure career development, new leadership skills, new skills to address new markets and promotion of an inclusive organization culture.
I look forward to hear your views.
Reference: IBM report “Journey to a value integrator”
Tags: Attrition, CFO, cfospeak, Culture, Human resources, IBM, IBM India, Robert Parker, Transformation journey, value integrator
Posted in Robert Parker | No Comments »
Thursday, March 31st, 2011
Going into 2011, I was fortunate to interact with several CFOs in the recent past. I can clearly discern the sense of excitement as 2011 promises to be a great year for business – at least for India. We now know very well that we have a domestic driven growth which can be better with the support of export let growth. CFOs have a great job ahead to ensure that not only shareholders expectations are met but critical organization initiatives are underway and there is sufficient provisions to reap in the upswing and as well as there is a fair balance between cautious optimism and business exuberance. So here is my documentation of some top CFO concerns based on my best understanding:
1. Regulatory, Policy and Corporate Governance
2011 is an interesting year as we will see roll out of the International Financial Reporting Standards (IFRS). While this will be a phased rollout over the next 4 years, the large organizations have a mandate to ensure start of this standard. While almost all large organizations are very confident, it is something like going into a world cup cricket match - one is very well prepared but it is still a match out there. There could be some initial hiccups but things should straighten out from the second half of this year.
GST rollout has been postponed for next year, but am sure this will gather a lot of steam towards the end of this year. This will have a lot of implications on how supply chain will pan out and if the supply chain gets a good boost, I can safely conclude that this was one of the best policy initiative in India. However, implementation of any new policy does have a few roadblocks initially and I would be happy to see that this fits in well – sooner the better.
Corporate Governance – as CFOs and custodians of the best financial practices we take pride in not only following the Government norms but instill a great deal of value and ethics in the business. But pure wish and determination is not sufficient – it needs to be implemented through rigorous organization policy and processes. It needs a lot of effort on creating an awareness and education and training to ensure that upkeep of corporate governance starts from individual efforts.
2. Risk Management
This is not only limited to financial risks but also about business risks. How do we ensure new projects are identified and executed with lower risk ? What are the critical risks in certain mergers and acquisition? How well are the business continuity plans for the organization tuned for year 2011? The answers are not simple and even constructing a response is not fraught with risk elements. With economy showing up – one thing I am certain about is that there will be more elements of risks involved. But are we asking the right questions now?
3. Business Insights
This is perhaps going to be the topmost worry for the CFOs this year. While every organization has processes for creating business insights – but the question we need to ask now is how accurate and efficient are these insights. Are these insights coming directly from the market with the least distortions? What are the levels and rigours of analytics in place to derive the insights? Again the answers are not simple. This is such an important issue that we need to delve deep into our financial structure and ask – Are my data reliable? Are my current processes reliable? Do we have the right skills? If not what are the skill gaps? How reliable and efficient is my technology? What are the levels of insights that can be built? Do these insights conform to the general business environment? Perhaps this is the right time to rejig and ensure that better quality decisions are possible in this interesting year.
4. Skills
Finance organizations in India are today many times mature than it was about a decade ago. Finance organizations today focus more on training and development of individuals on financial decision making and create leadership within organizations. Day-to-day and repetitive processes are either being fully automated or are being outsourced. While some of my CFO colleagues may disagree, I see more opportunities coming up for CFOs to focus on planning and progression activities rather than hands on execution. This environment is presenting opportunities for newer ways of looking at the finance organization and hence appropriate training and skilling of individuals as tomorrow’s finance leaders.
I would be keen to seek your views and comments on this.
Tags: Business Insights, CFO, CFO priorities, cfospeak, Corporate Governance, GST, IBM, IBM CFO, IBM India, IFRS, Policy, Regulatory, Risk Management, Robert Parker
Posted in Robert Parker | No Comments »
Thursday, March 24th, 2011
Recently, I had the honour to address a very elite group of CFOs and business leaders from Kolkata on a CII platform. The backdrop of discussion was “Transforming while Performing”. I was really impressed with my co-speakers and panelists and am taking this opportunity to share some interesting thoughts that emerged in the discussions.
I was very impressed with Mr. MR Nayak, Executive Director, Allahabad Bank who during his keynote address emphasized the need for technology capabilities and global integration as the topmost priorities for a continual transformation in current times. While India may take a consolation compared to other economies on stability, we still have a long way to go to prove that our priorities are in the right direction. He highlighted the need for leadership priorities to demonstrate sense of urgency, communicating the change vision, top down and facilitating to remove obstacles for growth. Efficient product pricing and strategy, identifying and encouraging winning teams, consolidating gains, efficient risk management and encouraging new and vibrant culture in today’s organizations were some of the necessary steps in the transformation journey.
My esteemed co-speakers were chiefs of finance from Exide, British Oxygen, Mitsubishi Chemicals, Peerless and Haldia Petrochemicals who reiterated the importance of risk management, operational efficiency, precision and business insights and becoming a value integrator in the organization. As rightly articulated by the esteemed panelists, the current role of the CFOs was also critical in the transformation journey.
Highlights of what I shared with my learned peers were that new business models and new competitors are executing business disruption. And this trend will keep on increasing. Some key questions are a. How well do we know our customers and market? b. How efficiently and in least possible time can we go to market with our offerings and services? c. How do we ensure that our clients are able to provide the best to their clients? d. How do we embody creative leadership within organization? To answer these questions we need hard data and facts to support action. We are seeing an explosion of data of all sorts – in various media and in various forms – some data are useful, some are not and some are redundant. It is the ability to collect, process and utilize the relevant information in the best possible way, in the least possible time, is what is all about being truly interconnected, instrumented and intelligent. So the transformation journey is about enhancing these factors on a continual basis which hinges on effectively integrating organization strategy, performance and technology. Leadership building within the organization is another equally important criteria in the transformation journey. Innovation is perhaps the single most important criteria to create leaders and be ahead of competition.
I received very positive feedback on the need to have more such get-togethers discuss and debate key challenges that we have in hand and find solutions.
I am keen to seek your valuable views and comments.
Tags: Allahabad Bank, Business disruption, Business Insights, CFO, cfospeak, CII, Exide, IBM CFO, IBM India, Instrumented, Intelligent Innovation, Interconnected, Mitsubishi, Mr. MR Nayak, Peerless, Performing, Risk Management, Robert Parker, Transforming, value integrator
Posted in Robert Parker | No Comments »
Friday, March 18th, 2011
As a CFO, I wonder how often I go about doing my day-to-day work using common things without realizing its true value and significance. I sometimes imagine how life would have been so different without them.
When I look at my credit or debit card, I see that black magnetic strip carrying all my personal details – one swipe and transactions getting executed. I appreciate the thoughts that went into creating such a technology.
When I shop, I realize how barcodes have made our lives so much easier. A large portion of the inventory management is so dependent on these unique identifications
When I see ophthalmologists use the LASIK laser to treat patients, I wonder how cumbersome it would have been to do such procedures without them.
A modern personal computer (a laptop as it is called today) has become so ubiquitous that we cannot imagine so many day-to-day activities without them.
All these technologies were born in an IBM lab somewhere and many more technologies are getting conceptualized in some IBM lab across the world. IBM’s investment of more than $ 150 billion in the last 30 years and 75,000 US patents has helped the organization address human issues.
“Technology is the way we now see the world — including those dimensions invisible to the human eye. It’s how we map and understand the dynamics of the world’s complex systems. And it is increasingly how we decide on the best course of action — and put it into effect. You miss this if you see technology merely as a succession of gadgets, websites and ‘next big things’. It’s much more“, said Mr. Sam Palmisano, Chairman, President and CEO of IBM recently at a centennial address at Indian Institute of Management, Bangalore.
As a CFO, I see immense value in these simple words. Decision on the best course of action is now not only limited to what parameters we see in front of us but also on several factors that are in the backdrop. For all the right reason technology is becoming more pervasive to enable us to address the complexities in decision making. How far do CFOs understand and appreciate technologies that will shape the future world? How do we see new business models emerging? How can CFOs grab the opportunity now to steer future directions?
I would look forward to your comments
Tags: Barcodes, CFO, cfospeak, Credit Card, Debit Card, Gadgets, IBM, IBM India, IBM lab, LASIK, Patents, Personal Computer, Robert Parker, Sam Palmisano, Technology
Posted in Robert Parker | No Comments »
Friday, October 22nd, 2010
Volatility has become the norm rather than the exception in the world of business planning. The “mindful” or “expectant” corporate attitude is that which prevails—similar to the Confucian tale of the man who survives dropping down a waterfall because he has anticipated the turbulent nature of the water. The world economy continues to sputter, halt and lurch, all the while against the backdrop of internationalization. Ten years ago, you faced four competitors in your country; now there are 15 in three different sectors on five different continents and they don’t let up with new offers or better ways to please their consumers and partners.
To be ahead of competitors we definitely need more focus on:
• Constant monitoring/analysis
• Linkage of operational drivers to financial targets
• Use of relative measures/ratios
• Scenario modeling for contingencies
• Deep, cross-functional contribution with workflow
Consider these practical best behaviors for expense management and planning, recommended for today’s dynamic business environment. I am sure as CFOs everyone of us are clued on to all these aspects. The objective of my writing was to bring out the top 11 priorities and seek your views:
1. Understand variable versus fixed.
Separate your discretionary costs from non-discretionary and seek a very detailed view of each. Look to pare back your discretionary spending. These expenses, which might be considered necessary for long-term profitability, can include all non-customer-related spending such as travel, supplies, training, memberships, and more costly recognition activity. Reduce judiciously your customer-related spending. Could your company, for example, take advantage of more online activities for interactivity with customers or moderate the spending for major customer events? Would local events be more effective and less costly? Temper marketing: With a reduction in advertising, customers will be understanding or even appreciative in some cases.
2. Dig for business drivers
Understand how operational drivers affect your financial expense targets so you can keep tabs on cash, margins and profitability. Getting a handle on the cause-and-effect relationships is probably one of the most important, yet most ignored “businesses” of your business. In addition to managing down variable expenses, examine transactions and processes from marketing to supply chain to logistics. According to Jeremy Hope, “Many ‘bad’ transactions are caused by errors and work not done right [the] first time. But costs can also be reduced by cutting the number of ‘good’ transactions such as those driven by purchase and customer orders, sales invoices and check payments.
3. Analyze for profitability
It’s certainly not enough simply to batten down the hatches and hide till the economic ill winds blow over. Hunker-down strategies, including indiscriminate cost management or across the board expense control, cannot lead to a profit sustaining enterprise. It’s important to understand your areas of greatest profitability and continue to adjust, not just trim. Analyzing profitability over alternate dimensions, such as customer, channels and products, helps derive newer insights into expenses that can be adjusted in those business contexts.
Profitability analysis can also help you understand expense items from a value-added perspective and, therefore, can help optimize resources, that is, you can plan for the relative impact of each expense item to its profit potential. For example, suppose your company funds a division just enough to keep it profitable. To increase the division’s profitability to an even greater level, rather than increase its budget, you could reduce non-customer discretionary spending. You could then use those savings in other areas of the division, such as for the addition of the talent needed to generate more sales or profits.
4. Leverage growth markets
Focus on growth markets near term. Prudently allocate resources in lucrative regions but assess profitability frequently, making sure you don’t underfund a promising new initiative. Consider a hold on hiring in the non-revenue, non-growth areas of the business with the exception of initiatives linked to increased profitability.
5. Model scenarios for plans and contingencies
Best-in-class companies operate in the framework of a sustainable cost strategy or with contingency strategies in their back pockets. The result is few surprises. So be able to build new scenarios and ask what-if questions against those models. For example, rapidly calculate your potential profitability level if your revenue drops by 10, 5 or 3 percent and plan for greater return. Test the investment benefit in an off-shore lab or facility. Following the good habit of industry leaders, be able to view and analyze the complete story about your resources and costs. As plans roll out, you can frequently assess them with comparisons to actuals.
6. Keep an eye on ratios
Build targets to track your relative expense ratios such as sales spending per sales head/revenue or the expenses of any particular business unit in relation to total spend. Trending is vital: assess month over month or more frequently, depending upon the spend rate. Run what-if scenarios for key expense ratios by region, segment and product and develop multiple contingency plans, including those for uplifts in the economy or profitability. With any highly fluctuating resources or commodities, you will want to track day-by-day or even hour-by-hour as well as long term.
7. Make adjustments in accounts receivable.
Set a policy for a disciplined focus on collection; adhere to collection terms and policies. Ask customers to finance payments to lower your risk and make collections as soon as possible.
8. Tap into industry benchmarks or league tables
Constant, effective monitoring and analysis against external comparisons can help a company move away from budget negotiations, that is, the preservation of budget to control turf versus budgeting for business improvement.
9. Reduce the time to collect data for analysis
The process of aggregating inputs from multiple users and spreadsheets inhibits planning effectiveness. Technology can speed up planning and forecasting and even reduce budget iterations. APQC and Beyond Budgeting Roundtable (BBRT) recently reported that “commercial and internally developed software applications are 145% more likely than spreadsheets to have real-time data fully available.”
10. Approve exceptions rapidly
Make sure workflow for exceptions is clear and streamlined to expedite those needing attention, especially to remove blocks from initiatives.
11. Connect your financial reporting to planning processes
Given the changeable marketing conditions, can you reforecast revenue easily and rapidly from the P&L statement? For rapid planning, recasting or modifications to plans, and forecasting, your financial data should automatically feed your enterprise planning process. The objective is for you to have access to vital actuals such as revenue, headcount expenses and cash flow—perhaps even on a daily basis.
Data Source/References/Quotes :
IBM Cognos White paper: Copyright IBM Corporation 2010
Disclaimer
The views and opinions mentioned in this blog are strictly my own and in no way reflect those of IBM or any other corporation or individual in any manner
Tags: amount receivables, budgeting, business drivers, CFO, cfospeak, contingency planning, downturns, exception approval, Expense, growth markets, IBM, IBM India, industry benchmark, league tables, planning, ratios, Robert Parker, upswings
Posted in Robert Parker | 1 Comment »
Sunday, September 26th, 2010
CFO, once considered as an executive with proficiency in figures, is no longer confined to the game of numbers. Having undergone through changes over the period of time, they now play a major role in driving the business for their organization.
I am sure we all would agree with the fact that the role of a CFO is no longer the same, first the transition happened post liberalization and then the recent tragic financial turmoil changed it further, bringing the CFO on to the business intelligence desk.
“Don’t get boxed in. A mix of finance- and operational-related roles makes a better finance chief,” says IBM finance head, Mark Loughridge.
An article published in Financial Times, titled Number cruncher to co-pilot featured Mark Loughridge, CFO, IBM, as a part of a new breed of CFO. The article mentions various jobs that Mark had taken before taking the finance seat and how the diverse past experience helped him in his current role of CFO.
Starting his career as a development engineer and then becoming a strategic planner, Mark feels that having a dual set of opportunities is not only good for the corporation, but it provides a much richer career path for the finance population as well,”
The IBM global CFO study launched few months back also highlights the nature of change in roles and responsibilities of a CFO. It was during this period, CFO’s were asked to take up the charge and support their organization sail through the gloomy period. The sudden exposure to such a critical and complex business environment transformed the whole outlook of a CFO and today at C suite level, CFOs are considered imperative as they help their CEOs is making financially viable business decisions.
In favour of the CFO study findings, I believe in today’s dynamic business environment that is full of complexities, CFO’s with their analytical skills, business intelligence and business insight can support the business development process in their organization.
I strongly believe that this transformation of CFOs from being the Score-keepers of their organisation to Corporate Co-pilot will further strengthen the relationship between them and their CEO’s.
However, I am sure that apart from helping the board in making business decisions, there is lot more to a CFOs Job and it would be really great to read your opinions and views on this topic.
Data Source/References/Quotes:
Financial Times
IBM.com- IBM CFO Study 2010
Disclaimer
The views and opinions mentioned in this blog are strictly my own and in no way reflect those of IBM or any other corporation or individual in any manner
Tags: CFO, CFO IBM, CFO India, CFO Study, cfospeak, IBM CFO, IBM India
Posted in Robert Parker | No Comments »
Friday, July 16th, 2010
As a matter of being up to speed to on what’s happening in the financial world around us, it is often my hobby to go through relevant editorials, which are of interest to me. One such global topic which has been the cynosure of the financial media worldwide, has been the crisis around euro, where matters came to a tipping point with civilians in Greece protesting in outrage over non-acceptance of the Euro as their official currency.
As this topic had been grabbing the headlines across financial media, I made it a point to go through interesting articles on this topic whenever I got the time but it was this article on CFO.com, which got me thinking about a different take that we as CFOs can take from this entire crisis.
At the outset, this is a crisis as the media has dubbed it, but every crisis is also the hotbed of opportunity and new innovations. Are there learnings from the Euro crisis that Indian CFO’s can reach out for? Having got the idea, I had mulled over it for a while before I came up with a few thoughts which I have now penned down to share with my larger peer community. Would be nice to know what you feel about this as well.
As the Euro crisis scatters to other European countries causing worldwide panic, I believe Indian companies may have a reason to worry a little. According to what RBI Deputy Governor Usha Thorat “Money probably tries to come to places where it gets better returns. So from the point of view of capital flows, you do have the likelihood of more uncertainty in the rest of the world and therefore more money coming to India,” RBI Deputy Governor, Ms. Usha Thorat told reporters in Mumbai. Thorat added that Indian banks have a healthy asset quality and “there is nothing to worry.” This is because the Indian economy is largely a domestic economy and is therefore cushioned against the blow from global crisis. Our exposure to the European market is merely 2-3%. Even during the subprime crisis, we bounced back into shape much quicker that the rest of the world. Source- Economic Times.
But having said this, I must add that, the insulation will only remain if the situation does not worsen. Like Mr. Pranab Mukherjee, Hon’ble Finance Minister of India pointed out at the annual general meeting of the Indian Banks Association (IBA), “If the crisis in Greece turns into a larger European sovereign debt crisis and possible fragmentation of the European region, there are chances of adverse capital flows. And such a scenario would be a major concern for India in the medium-term.” If the situation does worsen, then India would bear the brunt to. As an emerging economy we are integrated with the world and may suffer reduced cash flow into India. Another concern is the depreciation of euro by 9% against the dollar. The Euro which was quoting at around Rs.67 before the crisis is way below at Rs.55.92 currently. This becomes a stressful time from a currency management perspective than we used to have because we used to manage only the dollar earlier. Now we are dealing with the euro and British Pound and the Australian dollar. The sharp depreciation of the euro could ultimately have cash flow impact on the remittances. Source- DNA.
But having said this, there is also a silver lining that cannot be ignored. In an article published in livemint, the author has mentioned that the ongoing debt crisis could translate into lower valuations. “With better buying power of an appreciating rupee, it presents a second window of opportunity for most Indian firms that missed out on making major acquisitions in the US or Europe during the slowdown that started in 2008” , Source: Mint. As spending trends in the European markets have drastically dropped, Indian companies are seeing a blooming opportunity. Here is where I believe every CFO must align closely with his CIO to understand the IT needs of the company from a business growth and cost perspective. Necessary expenditures that would prove beneficial in the long run made in such economically tense environments should keep the health charts stable and the status-quo maintained. IT governance and costs need to be ascertained as much by the CIO as the CFO and it is here that the role of the CFO has to undergo a paradigm shift in terms of legacy to what it currently needs to be.
The Euro Crisis is an eye opener on this. While the ramifications of this might not be felt directly by all of us here, yet here is a learning that we can all tap on as CFOs to understand how we need to rethink our role in an organization and thereby chart out those growth metrics where we need to focus on.
These are some of my rudimentary thoughts on how we can take a crisis and glean learning’s from it which can become intelligence for growth to us as a community. Let me know your thoughts on the same.
Sources/References/Quotes
CFO.com – A Big Fat Crisis Averted?
Economic Times – Euro crisis may trigger more capital flows into India: RBI
DNA – Prolonged Euro crisis could impact capital flows: Pranab Mukherjee
Livemint – European crisis presents buyout window for Indian IT companies
Disclaimer
The views and opinions mentioned in this blog are strictly my own and in no way reflect those of IBM or any other corporation or individual in any manner
Tags: cfospeak, DNA, Economic Times, Euro Crisis, IBM CFO, Pranab Mukherjee, RBI Deputy Governor, Robert Parker, Usha Thorat
Posted in Robert Parker | No Comments »
Wednesday, June 16th, 2010
I remember sometime back when I shared the IBM global CFO report with you
all; I talked about how the global crisis last year brought CFO’s in the
spotlight and added a whole bunch of new responsibilities on their
shoulders. This time around I have the pleasure of sharing the newly
released IBM Global CEO report with you all. The report, unlike CFO study,
showcases the period of evolution, change, crisis, opportunity that a CEO
has been dealing with.
We all agree that the economic environment of year 2009 was a wake-up call.
As Mr Sam Palmisano, Chairman, MD & CEO, IBM says – It was just the latest
in a series of alerts that sounded during the first decade of this new
century. In a very short time, we’ve become aware of global climate change;
of the geopolitical issues surrounding energy and water supplies; of the
vulnerabilities of supply chains for food, medicine and even talent; and of
sobering threats to global security. The common denominator? The realities
— and challenges — of global integration.
We occupy a world that is connected on multiple dimensions, and at a deep
level — a global system of systems. That means, among other things, that it
is subject to systems-level failures, which require systems-level thinking
about the effectiveness of its physical and digital infrastructures. It is
this unprecedented level of interconnection and interdependency that
underpins the most important findings contained in this report. Inside this
revealing view into the agendas of global business and public sector
leaders, three widely shared perspectives stand in relief.
1. The world’s private and public sector leaders believe that a rapid
escalation of “complexity” is the biggest challenge confronting them. They
expect it to continue — indeed, to accelerate — in the coming years.
2. They are equally clear that their enterprises today are not equipped to
cope effectively with this complexity in the global environment.
3. Finally, they identify “creativity” as the single most important
leadership competency for enterprises seeking a path through this
complexity.
Events, threats and opportunities aren’t just coming at us faster or with
less predictability; they are converging and influencing each other to
create entirely unique situations. These firsts-of-their-kind developments
require unprecedented degrees of creativity — which has become a more
important leadership quality than attributes like management discipline,
rigor or operational acumen.
Hence as a CFO, I am thinking aloud on:
a. How do I capitalise on the new business complexities ? This needs
investments to not only manage but also benefit from it. As soon as I look
at it as a cost head, I have ceded ground to my competitors
b. Creativity can be defined more accurately by industry verticals – For
e.g. we all know about the ongoing Euro crisis. Different industries will
have a different impact and the creativity to address this will be
different once again.
c. How do I ensure that my CEO has insights and understanding of the
finance organisation in the complex environment
I am keen to seek your views and comments on these.You may like to
download your own copy of the IBM CEO report from
http://www-935.ibm.com/services/us/ceo/ceostudy2010/index.html . I am sure
it will be a good read. This is the largest CEO study till date after
direct interviews with over 1500 CEOs across the globe.
I remember sometime back when I shared the IBM global CFO report with you all; I talked about how the global crisis last year brought CFO’s in the spotlight and added a whole bunch of new responsibilities on their shoulders. This time around I have the pleasure of sharing the newly released IBM Global CEO report with you all. The report, unlike CFO study, showcases the period of evolution, change, crisis, opportunity that a CEO has been dealing with.
We all agree that the economic environment of year 2009 was a wake-up call. As Mr Sam Palmisano, Chairman, MD & CEO, IBM says – It was just the latest in a series of alerts that sounded during the first decade of this new century. In a very short time, we’ve become aware of global climate change; of the geopolitical issues surrounding energy and water supplies; of the vulnerabilities of supply chains for food, medicine and even talent; and of sobering threats to global security. The common denominator? The realities — and challenges — of global integration.
We occupy a world that is connected on multiple dimensions, and at a deep level — a global system of systems. That means, among other things, that it is subject to systems-level failures, which require systems-level thinking about the effectiveness of its physical and digital infrastructures. It is this unprecedented level of interconnection and interdependency that underpins the most important findings contained in this report. Inside this revealing view into the agendas of global business and public sector leaders, three widely shared perspectives stand in relief.
1. The world’s private and public sector leaders believe that a rapid escalation of “complexity” is the biggest challenge confronting them. They expect it to continue — indeed, to accelerate — in the coming years.
2. They are equally clear that their enterprises today are not equipped to cope effectively with this complexity in the global environment.
3. Finally, they identify “creativity” as the single most important leadership competency for enterprises seeking a path through this complexity.
Events, threats and opportunities aren’t just coming at us faster or with less predictability; they are converging and influencing each other to create entirely unique situations. These firsts-of-their-kind developments require unprecedented degrees of creativity — which has become a more important leadership quality than attributes like management discipline, rigor or operational acumen.
Hence as a CFO, I am thinking aloud on:
a. How do I capitalise on the new business complexities ? This needs investments to not only manage but also benefit from it. As soon as I look at it as a cost head, I have ceded ground to my competitors
b. Creativity can be defined more accurately by industry verticals – For e.g. we all know about the ongoing Euro crisis. Different industries will have a different impact and the creativity to address this will be different once again.
c. How do I ensure that my CEO has insights and understanding of the finance organisation in the complex environment
I am keen to seek your views and comments on these.You may like to download your own copy of the IBM CEO report from here. I am sure it will be a good read. This is the largest CEO study till date after direct interviews with over 1500 CEOs across the globe.
Data Source/References/Quotes:
http://www-935.ibm.com/services/us/ceo/ceostudy2010/index.html
Disclaimer
The views and opinions mentioned in this blog are strictly my own and in no way reflect those of IBM or any other corporation or individual in any manner
Tags: Business complexities, CEO report, cfospeak, Euro Crisis, Finance Organisation, Global Integration, IBM, IBM CEO, IBM CFO, IBM India, Robert Parker, Sam Palmisano
Posted in Robert Parker | No Comments »
Monday, April 26th, 2010
I was delighted to meet more than 80 CFO colleagues from Mumbai and Delhi in the last fortnight - most of whom I am in touch with on linkedin. The just released IBM’s CFO report was the backdrop of discussions and it was wonderful to get deep insights including some very thoughtful debate. The last 5 years has been dramatic in Indian business and this was the time when a large number of Indian companies transformed into global companies and acquired some of the best brands across the globe. And these were the times when the traditional roles were shed and some of the best talents in the Indian Industry were seen as the CFO.
Especially over the last one and half years, we realised that navigating uncertainty became the biggest demand for business. For a lot of companies it was like driving in the dark with blown out headlamps. And the challenge was not only to keep on driving but to re-assure passengers that you will pull through. However, over the years some companies have combined their discipline in finance execution and business insights to emerge as the “New value integrators” in the finance organisation. Some of my CFO colleagues did mention that the CFO is the best person in the organisation to have an end-to-end view of all activities and there is a huge opportunity to create additional value by integrating and managing these views in an appropriate manner.
How can you believe the analytics, if you don’t belive in the data ? The accuracy of the data lies in how efficient and disciplined the process is that generates the data and as one of my CFO colleague mentioned at Mumbai that it is the rigourous process that is more important first. This process has human presence and there needs to be a culture of constant training and upgradation of skills, so that ultimately we can arrive at that accurate date which will give us better insights at the end of the day.
I will be keen to seek your views and thoughts and if you have still not received your own copy of the report, I would request you to download one from www.ibm.com/in/cfostudy.
Looking forward to some fruitful discussions
Sources/References/Quotes
IBM CFO Study
Disclaimer
The views and opinions mentioned in this blog are strictly my own and in no way reflect those of IBM or any other corporation or individual in any manner
Tags: CFO, cfospeak, IBM, IBM CFO Study, India, New Value Integrator, Robert Parker
Posted in Robert Parker | 1 Comment »
Friday, April 9th, 2010
While we sit back and ponder, what a crazy time recent slow-down was, it would be unwise to ignore the ‘good’ it taught us. The 2010 Global CFO study, conducted by IBM brings together all good and bad, the recession brought in for us.
I personally believe that times of commotion brings along opportunities for positive transformation. And, now having witnessed the new financial trend, I certainly feel that my belief is true. The recent global economic gloom has been an important event for CFO’s around the globe. The situation put CFOs’ & financial organisations in the spotlight, asking for urgent solutions- capital acquisition, cash flow and revenue challenges.
IBM’s CFO study based on the inputs from more than 1900 CFO’s and Finance leaders from across the globe, highlights the change/additional responsibility that down-turn brought for the CFOs. While, financial responsibilities still form the core of any finance leader; his focus on company-wide concerns cannot be ignored. Today a CFO is required to be an information repository for business care takers, helping them make right business decisions.
The recent time has brought a CFO closer to board room conversations, he must guide the enterprise in making timely, risk based decisions by providing right business-relevant information. In the coming years outsourcing model in finance will surge and help companies achieve desired ROI more quickly.
All these new dimensions to a CFO’s job profile would have never flourished had the recession not hit. The situation may have temporarily put brakes on the economy but has certainly paved way for building a robust financial
structure.
I would like to know from my peers what they feel are the key takeaways from this study. For those who have not received the study yet, you can go to www.ibm.com/in/cfostudy for your very own copy. Please write back on this forum and let me know your thoughts and we can create meaningful discussion based on the insights that we have collectively gleaned from a study like this.
Sources/References: www.ibm.com/in/cfostudy
Disclaimer
The views and opinions mentioned in this blog are strictly my own and in no way reflect those of IBM or any other corporation or individual in any manner
Tags: CFO, CFO Study, CFO Study 2010, cfospeak, IBM, IBM CFO Study, IBM India, India, Robert Parker
Posted in Robert Parker | 2 Comments »
|
|
|
My name's Robert Parker, and I have been working with IBM India from April 2008 as a Vice President, Finance and Operations IBM India/South Asia. In my 23 years of career with IBM I had a wide range of financial positions within Australia, New Zealand and Japan.
Loading ...