Next Normal Planning and Execution

Bob Saiz

CFO at SupplyCore

Learning Objectives

We have all been impacted over the events of recent months. Without an end in sight to the current uncertainties, what can CFOs do to better steer analytical and strategic resources to the priorities that matter. Successful CFOs are rethinking the traditional playbook to increase speed and flexibility in FP&A, improve performance reporting, and accelerate decision making.This presentation will highlight solutions to plan and execute through uncertainty and beyond using software tools specifically designed for this purpose.


Key Takeaways:



  • CFOs will need to ensure that recovery strategies are visible and well communicated within the organization -- whether employees are in the office or working remotely

  • Software tools are available that can help balance near-term priorities and long-term goals

  • CFOs need a new navigation system to succeed


"Communication is paramount, and ways to better align our business is what is key. "

Bob Saiz

CFO at SupplyCore

Transcript

Hello, my name is Bob Saiz. I’m the Chief Financial Officer of Supply Core. We are a Rockford, Illinois based defense contractor. We also have a number of affiliated companies that we work with, including a software company. We do real estate development activities, and we have a retail presence as well. So we have a wide ranging business and a lot of different competing functions. Strategic planning is something that is very important to us, again, given the breadth and scope of what we do.


I’m here today to speak with respect to next normal planning and execution. This year has been something that we’ll always remember for sure. As we think about how to better navigate moving forward, there’s a couple things I’d like to share with you today. It’s going to be a pretty brief presentation, but I hope you find it interesting.


I like to start presentations with this chart, especially when it’s involving financial planning and analysis. I don’t know that life was ever like the top section of portrays, a nice straight line, I don’t think life has ever worked that way. But for many of us, I think businesses and some of our processes, maybe have been a bit on autopilot. Now that we are in this kind of new world here, reality is certainly looking more like the bottom. How to get from here to there, how to execute is, I think, proving to be as challenging and maybe more challenging than ever.


Think about the old normal, maybe pre February 2020. Again, as I’d mentioned, I think many of us had been using the same processes for many years, and then the crisis hit. We were thrown into trying to make sure that we had ample liquidity in our business, making sure that our employees were safe, trying to determine how to best create a work from home scenario. Our businesses were kind of being held together in many cases. Now we’re sitting here kind of looking at what the next normal might bring, many of us might have thought that the pandemic might have been a bit toward the wind down phase by now, but it doesn’t appear that way.


So what can we, as CFOs, do, and how can we better serve our businesses? One of the things I’d like to really key in on, and I would like to note as well that I’m relying today on a couple of outside sources. I am using an article from McKinsey a couple weeks ago, called No Longer on Autopilot: Lessons for CFOs from COVID-19. I’m also relying on some research from Gartner research.


One of the keys is to really make sure that we’re building scenario based planning into our FP&A activities. Trying to build models where we have momentum cases, maybe where it’s just trying to see what is happening with the current trajectory of the business, and then also building in scenarios to try to account for the uncertainties out there. Other firms are looking at more of a resource allocation method, maybe we are looking at building models where we only fund fixed costs for certain business units. When situations or when events happen, that causes us to want to further invest in those organizations, then we go ahead and start spending towards the variable cost side of things.


One of the items that I’m going to mention in a bit more detail in a moment is how to improve performance reporting. I think we all use key performance indicators. We’ve all had various types of these indicators before. But I’d like to show you a way today that might help you rethink some of that, and how you can make these truly come alive in your business.


Lastly, I think situation clearly informs us that we need to accelerate decision making. We need to be more nimble perhaps than we’ve ever been before. This chart here to me, what’s more important than what’s in the boxes is all of the arrows and interdependencies. You see the relationship between the CEO and the CFO, the CEO and the P&L owners, the CFO and the P&L owners, and then of course, the functional leaders. If you look at every place where there’s an arrow there, in my view, there’s a place for communication to break down for silos to develop and for breakage to occur.


I think most of us or many of us certainly, were involved in significant digital transformation efforts when the pandemic hit. These are expensive, complicated endeavors as I’m sure most of you well know. We’re involving our people, our technology, our processes. We’re spending a lot of our resources and you think about the type of communication that needs to occur in order to be successful in what we’re doing. Communication is paramount, and ways to better align our business is what is key.


59% of senior executives admit that their organization struggled to bridge the strategy implementation gap. My question is, I’d like to meet the other 41% because I think this has always been a challenge. I think every business faces challenges like this. I’m here to show you something that I think you would want to consider relative to your FP&A and your overall organizational execution. Our President CEO made this quote, and I think what’s important here is that we’re talking about that the CFO has got to be able to balance what’s right in front of them with what’s down on the roadways. We’ve got to be able to see both clearly. We have to be able to respond to issues involving both short term and long term items that are impacting our business.


I mentioned at the beginning that our firm has a software company called Empower. About 10 years ago, we developed software to use internally to help us better execute as an organization. It was an internal tool, served us very well. Since then, a whole class of software tools have developed called strategic execution management. There are a number of firms now doing something similar to what we’re doing.


These are tools that are there to help you broadly communicate and execute your plan. If you look at the dashboard on the left of your screen, that’s something that I would use on a daily basis to help me better manage my work, to help me understand deadlines and timelines, things that I need to be really thinking about, and how to get a good look at the business. There are KPI metrics that you can use as widgets, and put up there depending on what it is you want to be looking at. Then, there’s a section where it monitors the strategy and overall health of the plan.


Items in green are considered healthy, items in yellow are at risk, items in red are definitely not where we want them to be. So that’s where I think most of the leaders in our company tend to focus. You see the gray there as well, those are items that maybe not have not yet been started, or do not have any measurable progress. But this just really is one place to help me manage my work, because as we know it, sitting in a CFO chair is a very complicated endeavor. It helps to have a common platform for leaders within the organization to communicate and to execute.


I like the fact that our software is mobile friendly. Wherever I am, whether I happen to be on the road, or at home, or wherever, I’m able to actually do a substantial amount of my work. I never thought I’d see the day where where that was possible. Again, it’s just a way to help us communicate, align, and execute. When we create actions and plans and so forth, we also have the ability to put in progress notes to let others within the organization see your progress to let them know what’s going on, any challenges you might be having. These progress notes are emailed out on a regular basis. We also have the ability to interact with Slack, Dropbox, Google Drive, and things like that. The integrations that we built in are powerful, and help you to plug into other business systems that you might already be using.


The goals here are to reduce the silos. Silos are killers. I mean, let’s face it, all organizations have them. What we work very hard at is to make sure we are reducing those silos, that we’re trying to increase collaboration and transparency, so that everyone knows what everyone else is doing on a real time basis, get another view of the plan. Towards the bottom of the image, you can see what we call the starburst, enables you to drill into various sections of the plan and help you understand items that might be at risk. Just a way for you to to better manage your workload. This is a really neat tool and these are low cost tools.


I would suggest that they are very beneficial to add to your technology suite. As you think about it, we all have a lot of technology platforms, and you might think, “Geez, do I want one more?” Well, I’d encourage you to take a long look at it, because sure, you can do this stuff in Excel, Word, and via email. But it’s just hard to broadly communicate where you are as an organization. It’s hard to keep people aligned using those tools. As CFOs, I think many of us have been in a position where we have board reporting responsibilities, and all of a sudden, there’s a board meeting coming up and you realize, “Wow, I might not have made as much progress on some of these things.” So you change a few dates, maybe change a few numbers, and hope the board doesn’t yell at you.


This type of tool enables you to just keep everything real time. In fact, we have a number of our clients that the boards are actually engaged within the tool. So the boards are able to stay plugged into what’s happening from wherever they may be. Just a good way to, I think, improve board and management communications, and give visibility to the items that need the most visibility, and that are strategically crucial to the organization.


In addition to our software, we also do help with strategic planning. We have a team of professionals that can help dust off plans. Quite often, it’s nice to have a third party just come in and just kind of help challenge the paradigm, if you will, and just coordinate planning activities. We have experts that do that. We also do things with mission and vision and so forth for some of our other organizations. Basically, we have a suite of services that we’re here to provide.


I think it’s really beneficial to see what we’re able to do for our clients. We’ve been winning awards. It’s nice to see our customers saying good things about us. Again, I would encourage you to think through whether or not your organization is executing as efficiently and as effectively as you can. If the answer’s no, and I would expect or anticipate that most organizations would come to that conclusion, would really encourage you to think about a software tool like Empower Envision to help drive your business forward.


Alright, that’s it. I hope you found this helpful. My contact information is there. If you would like to speak with me at any point in time, please feel free to reach out. Thank you.


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