Tag Archives: business financial planning

Other Forms of Restructuring

 

There are other kinds of restructuring which are self explanatory:

Changes in top management

This means the changes in the top and the operating management in the company. This begins with the change in the CEO and Managing Director level changes to bring in the change driver commensurate with the need of the hour. The “person of the moment” is seen as a key driver of policy changes and mover and shaker by the promoter management and by the market. The team to work under the top person is many times left to his or her discretion. By and large the person brings along a tested team which perhaps has seen a good turnaround elsewhere which does not mean success is guaranteed, but that which could be tried out in the new place. This includes at the Board/operating level and may include heads of profit centers, HR, Marketing and other critical positions. Finance is usually a closely guarded level and the top management may like to bring in someone from within the loyal group of professionals.

Retention of key management team

There are also instances when some people are considered indispensable and their retention in the company is absolutely required. Such persons are retained in the company by paying the stay on bonus in cash or in the form of stock options. This will give significant motivation to persons for continuing in the organization and be a part of the changing environment.

Moving of operations such as manufacturing to lower-cost locations

In late 80’s and early 90’s the set up in various companies used to be “fractured infrastructure”. The Corporate Office set up will have Marketing, Procurement, Finance, HR apart from the usual corner office paraphernalia. The plant correspondingly would have the functions such as Sales, Purchase and stores, Accounts, Industrial relations, etc performing some parallel or even overlapping functions. Leaving a small set up for the Corporate office, MD and associated functions, it was found to be productivity and cost effective by combining functions in one location for cost saving, better plant management and effective customer and plant relations. Moving plant locations have also been done in the past to improve proximity to the raw-material and customer market, better availability of power etc.

Conclusion:

Restructuring is a process and involves careful planning and application. The company can phase the restructuring process say over a period spanning 6 months to one year giving time for observing the impact of the restructure across the entire business. The costs and productivity being important, it is also necessary to keep the interest levels of customers and motivation of employees alive. Many restructuring has resulted in panic among these sections resulting in the flight of customers and key employees. The new of restructuring will therefore need to be timed out and suitably explained as it happens.

SuperChat with SuperCFO – Manish Dawar

SuperChat with SuperCFO - Manish Dawar
SuperChat with SuperCFO – Manish DawarThis week on SuperChat with SuperCFO, we are delighted to present a tete a tete with Manish Dawar, who is the Senior Vice President – Group Controller for Reckitt Benckiser (RB) in the U.K., a GBP 10 billion – FTSE 25, company with leading household brands like Dettol, Nurofen, Strepsils, Durex, Lysol, Finish, Vanish, Veet, Airwick etc etc. Manish is a Chartered Accountant and a Company Secretary, having completed his Bachelor of Commerce from Panjab University in Chandigarh, India. Manish has a prolific professional experience of over 22 years in organizations of repute like Unilever, Reebok and Reckitt Benckiser. He was designated as CFO for Reebok India at a very young age of 31 and appointed as the Regional Finance Director for RB at the age of 36. He moved in his current role with the Company Head Quarters in UK in January 2009, where he is currently based. In this freewheeling chat, Manish delves on his 3 favorite companies, and why he admires Ratan Tata, Steve Jobs, and Warren Buffett. He admits that he is not much of a gizmo freak but conceeds that Apple has made life a lot more organized for him. For more on the SuperChat, please read on…….
Education: Bachelor in Commerce (B.Com.), Chartered Accountant (ICAI), and Company Secretary, (ICSI).

Companies Worked with: Hindustan Unilever Limited, Reebok International Limited, Reckitt Benckiser India, Reckitt Benckiser Group plc – United Kingdom.

SuperCFO: What particular skills or talents are most essential to be effective in your job apart from formal training?
Manish Dawar:
1. It is very important to have a deep understanding of business, along with
the key business matrices and the drivers that could have significant financial impacts.

2. Right leadership qualities. This is not a one size fits all approach and a person needs to evolve and have relevant leadership qualities depending upon the situation, maturity and the organizational need.

3. Communicate the purpose and keep people abreast of the developments. It is better to over communicate than under communicate.

4. You can only stand out through innovation and outside the box thinking. Stay ahead in the game and be ready with the solutions before the others are able to recognize the problems.
SuperCFO: Who is your role model and why?
Manish Dawar: I do not have a specific individual as my role model. However, a successful first generation entrepreneur who has been able to scale up on a global platform, inspires me the most. There are many such people who fall in this category and I would not like to name one and not the others.
SuperCFO: What has been your biggest achievement professionally?
Manish Dawar: I think I have done reasonably well on the professional side. Having started my career with Unilever in India, I went on to become Head of Finance for Reebok at the age of 29. I was promoted as CFO for Reebok in less than two years which was a much wider responsibility than just Finance. At 36, I was appointed as the CFO and Company Secretary for Reckitt Benckiser India and Regional Finance Director for South Asia for RB. South Asia has been one of the fastest growing regions for RB for the last almost 10 years now.

I also feel very proud to mention that there are at least 22 professionals who have worked with me over the last 10 years in various roles and then moved on to become the Finance Directors in various organisations. While I am sure it is because of their hard work and intelligence that they have reached where they are and I do not want to take away anything from them. However, I do feel happy about this fact and cherish every moment of it.

SuperCFO: Who are the 3 Corporate Honchos you admire a lot and why?
Manish Dawar:
Steve Jobs; one of the most significant corporate icons worldwide and one who has played a stellar role in impacting our personal and working lives. I do admire him for his famous speech at Stanford which had lot of spiritual connotations for me. He made a notable come back in his own company and went on to create one of the most valuable companies in the world within one generation and the rest as they say is history.

Ratan Tata; for providing a spirited and ethical leadership to an Indian conglomerate and giving it a global vision. He has been able to bring a lot of individual Tata companies together as a Group in terms of thinking and approach to business. The financial performance under his reign has been absolutely stellar and will be difficult to replicate.

Warren Buffet; for his tenacity and can do approach. I admire him for following a very simple and fundamental value investment philosophy which has reaped good rewards for his investors and the fact that he has made a significant commitment of his personal wealth to charity.

SuperCFO: Which are the 3 companies you admire a lot and why?
Manish Dawar:
Samsung, for taking on a global giant like Sony and beating them at their own game by doing what they were best at doing it.

Infosys, for opening the doors of IT revolution in India and distributing wealth amongst the Infosyians and various other stakeholders.

Google, for bringing the information and knowledge that exists in this world, on one’s lap, at a press of a button.

SuperCFO: Assume that you are indulging in role play. If you were given the position of the Finance Minister of your country, what would your top priority agenda items be?
Manish Dawar:
1. Right size the Govt. and its spending. In essence, fewer, more talented and well paid people.
2. Simplify and rationalise the tax structure.
3. Improve the governance system by having performance objectives and KPIs for all in Govt. including the Ministers. Ministers and Babus should also be fired for non performance.
4. Availability of funds for infrastructure development and water conservation. Water could be India’s single biggest problem in future.
5. Anti corruption – find honest role models within the Government to coach others.

SuperCFO: What would you advise aspiring CFOs on dos and don’ts to become a successful CFO?
Manish Dawar:
1. Follow your passion and try and excel in what you do.
2. Have the guts and the courage to say what you feel or think is right
3. Have the ability to convince others or get convinced.
4. Be willing to take the final call because the buck stops with you.
5. Your people are much more smarter than you think they are.
6. Never compromise on your integrity and ethical values.
7. All of us have a USE BY (expiry) date whether we know that
or not. In the real world, all of us are as good as what we did yesterday. Hence we need to continue to challenge, outperform and evolve ourselves for ever to remain competitive.
8. Remember that you need to run to stand at the same place.

SuperCFO: What are your 3 “Must Ask” questions in an interview?
Manish Dawar: I normally make my decision in the first 10 minutes of any interview and then I spend rest of the time with the candidate to make sure that my decision was right. This has worked well for me.

My must ask questions are:

1. Where do you see yourself in the next 5 to 10 years and what is your game plan to achieve the same.
2. Significant achievements in personal and professional life and why do you value them so much.
3. How do you differentiate yourself from others and what value do you think you can bring on the table for the role under discussion.

I do look for people with the right attitude and CAN DO approach apart from the technical skill sets needed for the role.

SuperCFO: Which is one accounting software that has impressed you and why?
Manish Dawar: I think Tally is a good accounting software and offers significant value for money. It delivers outstanding performance for any small or start up situation without huge investments upfront.

SuperCFO: How do you manage talent within your team?
Manish Dawar: The team should be able to look upto you. To achieve that, one needs to be ahead in knowledge, experience, application and content. At the same time one should always be willing to mentor the team. You need to be continuously challenging and stretching the team in a very positive way and make sure that they are always learning from all possible sources. Don’t always give them the solutions but coach them to go and search for the answers.

Another technique that I have applied quite successfully over a period of time is smart job rotations for key players in the team to broaden their learning and experience base and give them end to end responsibility. It is very important that people take ownership of their actions and this is the best way to manage talent. For me it is very important to have the right attitude apart from the skills which are a must.

SuperCFO: Are you a gizmo freak? What is your favorite gadget?
Manish Dawar: I am not a gizmo freak. I still prefer pen and a paper to take my notes, and I like to read texts on paper instead of on screen. Pen and paper channelizes my thoughts better and I am able to apply myself more creatively.

However the 3 Is (iPad/ iPhone/iPod) have made life simple, organised and so convenient that it is difficult to imagine the work and leisure lives without them. Needless to say, everything happened and worked before these gadgets and Mr Jobs has proven our dependency on his ability to identify and deliver on the consumer needs.

SuperCFO: What is your favorite piece of literature?
Manish Dawar: Panchatantra stories used to be my favourite when I was young. It offered, effective learning in a very simplistic way, related to moral conduct and ethical values.

This moved to Art of War by Sun Tzu when I started working. This being, one of the oldest and most successful books on military strategy in the world.

Over the last few years I have developed interest in Spirituality and tend to read as much as I can on Indian and Western approach to Human beings as Spiritual souls.

I am quite interested to explore the works of Chanakya.
SuperChat with SuperCFO – Manish Dawar

SuperChat with SuperCFO – Manish Dawar
SuperCFO: Any sport that you are passionate about?
Manish Dawar:
I do follow Cricket as most of the other Indians do. I try and top it up with Tennis and Football depending upon the time I have in hand and my travel schedule.

Let me admit that I am not passionate about any of these sports and my other activities take precedence over these unless there are some big games happening.

SuperCFO: Describe some of the activities that you undertake to de stress yourself?
Manish Dawar: SuperChat with SuperCFO – Manish Dawar
I do not get stressed easily and normally have calm nerves. Over a period of time, I have been able to put home and work in two separate compartments within me.

I go for long walks on the weekends and holidays and meditate regularly apart from small doses of Yoga and Pranayams.

All of the above have immensely helped me to keep stress away.

SuperCFO: What has been your favorite vacation destination and why?
Manish Dawar: I have quite a few favourite vacation destinations instead of just one.

I love Sydney, Vancouver and Cape Town and can go there as many times. We recently visited Scotland and were mesmerized with the place. All of the above places qualify in my view because they have lots to offer to a tourist. Nature has been very very kind and generous with all such places to bestow lovely weather and scenic beauty.

I am yet to explore Kerala in India which is on my active list of things to do.

SuperChat with SuperCFO – Manish Dawar