CFO in Transformation for the New Age By D Sundaram Managing Director and Vice Chairman TVS Capital

1. 1
CFO In Transformation For
The New Age
Changes & Challenges
By
D. Sundaram
VC & MD
TVS Capital Funds
24th August 2018
Mumbai

2. 2
Larger Purpose of everything we do.
• Corporate objective
- Delight the customer
- Reward the Investor
- Govern responsibly
- Remain socially relevant
• CFO is the Strategic Partner of Team
• Past descriptions are obsolete !!

3. 3
Volatility
Uncertainty
Complexity
Ambiguity
VUCA
World

4. 4
Changing contours and colours
• Global policy shifts
• Skyline is reshaping (business models)
• Changes & Expectations are continuously impacting
business
• Technological strides are a boon come with risks
• Known “Unknowns”; unknown “unknowns”
• Battle for Wallet; War for Talent
• Erosion of Trust
• Green sustainability demands

5. 5
CFO Grid
LEADERSHIP ATTRIBUTES
How
What SKILLS & CAPABILITIES
Business
Partnership
Functional
Excellence

6. 6
Business Partnership
• Business Intimacy
• Proactive engagement
• Constructive challenge (vs. Debilitating cynicism)
• Co-piloting for
- Market Leadership
- Cost Leadership
- Thought Leadership
• Performance Gap Vs Opportunity Gap

7. 7
Functional Excellence
• Prepare for continuous change
• Contemporize the function (Best Practice Vs Next
Practice)
• Sync with Tech potentials

8. 8
Building Blocks for Functional Excellence
• World-class Finance Processes
• Innovative Business Partnership
• Dynamic Performance Management
• Focussed Financial Flexibility & Capital decisioning
• Sound Risk & Compliance Process
• Excellence in Talent Development

9. 9
World Class Finance Processes
• Brilliant Basics
• Tech Enabled No touch Transactions
• Fraud Proofing.
Build Control layer on top of ERP
Real time concurrent exceptions !!
• Shared Services : from “back” to “centre” insights
generator

10. 10
Innovative Business Partnership
• Business intimacy
• Balancing collaboration & independence
• Decision sciences, e.g. marketing spends
• Pricing & margins
- Value creation levers
- % margin Vs absolute PBT growth !
• Ownership of Cost Agenda
• Slice / Dice : Business insights

11. 11
Dynamic Performance Management
• Limitations of fixed budgets
• Need for continuous forecasts
• Metrics & measures
- Clarity. Transparency. Relevance
• Cost Budgeting
Accounting headings Vs
Activity focus
• Plans : Disciplinary tool or visionary road map ?

12. 12
Focussed Financial Flexibility
• Business ownership of Balance Sheet
• Capital Allocation : Create Value
• Cash management systems
- importance of continuous forecast
- sudden nasty surprises ??
• Sharper focus on Below Line Costs: Financing & Tax

13. 13
Sound Risk & Compliance Process
• Bedrock of Governance engagement of CFO for Boards
/ Audit Committee
• Risks : Financial / Reputational
• Technology brings high risks in the form of Cyber
threats (Cyber Security)
• Proactiveness in the approach
• To be the driver of the ERM and compliance across
enterprise.

14. 14
Talent Management
• Building the network of the most valuable asset
• Capability Building
• Learning culture
• External orientation

15. 15
To recap
• Fundamental role unchanged – Protect Value; Create Value.
• Steer the business to navigate well in the face of “disruptions”
• Create a vision of the future and build a roadmap to ensure the
finance function is fit for the new world. Since accurate prediction
is not possible, create Agility to course correct as necessary.
• Get the right people and right technology in place, to manage
inevitable disruption
• Play a leadership role in driving E2E processes, with the Business
Services organization under-pinning most activities in the company
As Peter Drucker said, ‘The best way to predict the future is to create it’.

16. 16
And to sum up
• Play the role the future demands
• Remain contemporary
• Value creation that is inclusive of all stakeholders
• Demonstrate Pro activeness to manage risks

17. 17
THANK YOU
Acknowledged contributions from:
R. Sridhar, Chief Internal Auditor, Unilever Plc
P. B. Balaji, Chief Financial Officer, Tata Motors