CFO Folklore: Don’t Let the Boss Argue Your Case for You


Opposite DirectionsIn a small business with a flat organizational structure, where every exec performs 10-15 jobs, there is always a possibility of timeline conflicts.  It's like cooking ten dishes on a four-ring range: eventually you run into a point when the same burner is needed for two pots.  Which one to put on?  There is really no such a thing as a right decision at times like that – you must simply follow your instincts.

Let's say your are in the final stages of negotiating a Credit Agreement renewal with your main institutional lender.  It's Thursday, 03/13.  You have scheduled a meeting with the bankers, their attorneys, and your own esteemed corporate lawyers for tomorrow afternoon to press on with a few remaining crucial changes before the deal is released for the approval by the bank's Credit Committee on Monday, 03/17. 

At 5 pm your phone rings:  It's your tax attorney hesitantly letting you know that his team must meet with you urgently tomorrow, because they just figured out that the company may have tax exposures in Illinois and Wisconsin; the extensions are due on Monday, 03/17 (somewhat hysterically); and, he is very sorry to tell you, but he is not quite sure about this and that's why they need to seat down and read you into the details of the Code, so that you can express your opinion, because nobody understands the business better than you do.  No, it cannot be in the morning, because it's tax season and everybody's schedule is full as is; only the afternoon is workable for everyone who needs to be there (except you, of course, but who cares).

By the time you hung up, it's too late to reschedule the bank – most bankers leave at 5 pm, just like the government.  Now, you've got a dilemma.  Bank or taxes?  Of course, you can tell the tax lawyers to suck it up and do their well-compensated jobs without getting you involved.  Yet, you cannot – that's not how you do.  But the bank is incredibly important: the last stages of negotiations are the hardest, because nobody wants to give up the last frontiers.  On the other hand, you are literally the only person in the company who can express taxation opinions.  At least the owner has been in a tandem with you on the contest of wills with the bank.  However, he is easily mauled by financial predators if he is left on his own.                  

But what are you going to do?  It's the balancing act – you have to optimize.  You cannot be in two places at the same time.  So you decide that the tax meeting is the one you must attend and send your boss to the other one alone.  And, of course, you prep him on Friday morning.  You go over all important points of the agenda with him and outline your position on every issue (in writing, for better retention).  Then you silently pray to Hermes/Mercury, the patron god of all CFOs, and go on to your appointment.

You don't disturb him during the weekend, but as soon as he shows up at work on Monday (around 1 pm) you pull him into your office.  "Well, tell me," you inquire.  He beams at you: "Oh, it went very well.  They practically accepted all the conditions on the list you gave me.  You should have the amended Term Sheet by tomorrow morning."  You are cautious: "Practically?"  And he clarifies, "There is one item.  They said they couldn't do anything about migrating from weekly reporting to monthly.  But I figured that was okay, right?  Just this one thing?  And what?  It's like a nine-line report, or something?  Probably a few buttons on your system, right?"         

Well, it's actually a 52-line statement with 5 supplemental schedules. It takes two of your staff accountants several hours to update all raw data and 2.5 hours of your valuable time every Friday to compile the reports. This was one of the top 10 most important items you've introduced into the negotiations right from the start.  Of all items that's what he decided to let go?  And what is it with bosses?  Why do they always assume that everything you do is effortless – fast and easy?  Just because you are toiling away without making any fuss?! 

You feel like Zorg from The Fifth Element.  "I am very disappointed!!!" growls Gary Oldman inside you.  If you want something done correctly, you'd better do it yourself!  Unfortunately, you don't have his powerful ZF-1 under your desk.  So, instead of simultaneously throwing flames and blasting freeze-rays, you grab your phone like a weapon and calmly explain, "These weekly reports end up costing you a lot of salaried hours that can be used more productively otherwise.  So, let me call and talk to them about it again."      

Quote of the Week: Again on Ivy Leaguers’ Writing Skills


20131205204227!Harvard_shield-BusinessFrom an actual e-mail of a corporate COO, an HBS alumnus, blind-copied to several bankers, who lost their bids for the company's business, as well as to a few other addressees:

"As you know, we analyzed several competing offers.  One has been accepted and a good faith deposit paid.  All banks were quite detailed and specific in their term sheets.  In order to make both a proper and fair comparison, any uncertain items had to be discounted.  While it might have been useful to fully clarify all conditions and parameters, we made a decision not to allow banks to tweak their offers.  We felt strongly about not creating a Middle Eastern bizarre mentality and having every bank but one ultimately feeling used or abused."

The Frustrated CFO's comment:  Never mind the awkward phrasing and sentence structure.  How about that biased ethnic remark?  Except that it's not.  Well, at least it wasn't meant as such.  I actually asked and was told that somebody used the phrase on the news and that what the COO thought he's heard.  I had to explain that it was a "Middle Eastern bazaar" people referred to as a metaphor for haggling.  I talked him out of making a mess with a retraction.  "Bizarre bazaar… whatever," I said.        

Funny Thing Happened On the Way to Ohio, or That Picture of Your Boss You Posted on facebook


UntitledI've said it before and I'll say it again: all entrepreneurial bosses are the same.  Of course, I don't mean it literally – they are not stamped figurines.  Yes, they are the same in their principal qualities (aggressiveness, single-mindedness, drive, vision, impatience, arrogance, callousness, etc.), but they are also different people with their own psychological makeups,  individual quirks, and human peculiarities.  Some can be informal and approachable, others are aloof and snobbish.  Some can be intellectuals, while others are simple and limited.  Some of them are religious conservatives, others are broad-minded libertarians.  Some are healthy and others suffer from an array of ailments.  Some like spicy food and others cannot stand a hint of curry or garlic in the air.

There is one universally common denominator that definitely unites all business owners, though - they are employers.  And as I wrote in CFO Techniques, one should never cross the line with one's employer, if for no other reason than in appreciation for creating one's job.

So, here is a little anecdote that involves a sociable female business owner, her all-male sales staff, and some spicy food. 

First, let me clarify one thing.  This woman, tough as nails and brutal in her nature, nevertheless strives to present a friendly and cheerful demeanor to the outside world.  Experienced people can see through that veneer and know to watch their steps around her.  However, when you get together eight men, even though subordinate, and one woman, even though a boss, the dynamic gets a little muddled.  I mean, when they are in a gaggle, it's especially difficult for men to suppress the testosterone.  It clouds their judgement and they forget for a hot second what's behind that charming smile. 

Oh, yes, and about the food: she really does like it hot.  You'd be in a restaurant with her, she orders a dish and then asks the waiter, "Is it spicy?"  The waiter smirks, probably thinking, "That skinny bitch will be asking now to make it mild," and answers, "Yes, ma'am, it's very spicy."  And she goes, "Could you, please, ask the chef to make it spicier." (Sometimes I actually consider of giving her a present of Pure Capsaicin Crystals, but I know she's going to try them and I don't want to be responsible for the consequences.)

Back in December, she held a three-day sales summit in the company's NYC headquarters – all salesmen came over from their different locations.  This usually means breakfasts, lunches, and dinners together.  Thankfully, in NYC that's not a problem.  The team enjoyed French-Asian fusion, classic American steakhouse, Korean…  An Italian restaurant is always a must, since the sales person with the most seniority comes from a Bolognese family. 

Unfortunately for the boss-lady, Italian food doesn't offer too many possibilities for extra-spicy.  She orders Shrimp Fra Diavolo over linguine, but it's not doing the job.  Red pepper flakes are asked for and happily received.  She starts shaking the plastic thing over her plate and orangy-red bits sparingly drip out (there is a reason the container is designed this way – one must use the hot stuff with a caution).  That's not enough for her – she starts shaking harder and harder…  until the top flies off and most of the pepper from the bottle ends up in the sauce.  All the men at the table are laughing their heads off – the boss slipped up!  Maitre d' sees it (how can you not, with all that violent shaking?) and immediately runs over, offering to replace the dish.  The lady refuses and laughs lightheartedly with her "boys" about her clumsiness.  She removes some of the pepper excess onto her bread plate and proceeds to eat what, I imagine, is an unbelievably spicy pasta without breaking a sweat.

Six weeks later, the same group of people is on the road visiting their Rust Belt customers.  They started in Pennsylvania and are now on their way to Ohio.  I'm sure my readers understand that the food scene in the industrial towns of Western PA is not quite the same as it is in NYC.  Here you go for Italian because it's probably your best choice.  So, there they are again with dishes that vaguely correspond to the Italian names on the menu.  This time around the owner's sauce is not spicy at all, but the generic plastic bottle with red pepper flakes is already on the table.  She reaches for it and the shaking ensues.  The memory of the NYC debacle is too fresh for the boys not to bring it up: "Be careful, don't shake the top off," a few of them warn.

Let me step aside for a second: Just as the bosses' human qualities differ, so are the ones of the subordinates.  A couple of them are of the self-conscious type – they simply don't want to be inside a public spectacle again.  Others are genuinely concerned about her not spoiling her food.  Yet, there are always those resentful, passive-aggressive employees, who secretly cherish the idea of a boss making a fool of him/herself.  One of those had his iPhone at the ready.

Well, as you probably guessed, the container's top comes flying again and a half of the red pepper flakes ends up on the pasta.  Oh, the childish hilarity!  Everybody laughs – some wholeheartedly, some to cover up the awkwardness.  The prepared dude snaps the picture and immediately posts it on facebook.

A young salesman who told me about the repeat performance of the pepper flakes show was visibly hesitant and uncomfortable with the whole facebook posting part.  I was simply appalled at the disrespect.  And what about the owner/CEO herself?  Did she fire that rude fucker?  Of course not.  The emotions should not interfere with business - it's impossible to replace a high-caliber sales exec overnight.  But I know this woman very well.  She's never going to let it go.  You can see it in her unsmiling eyes when she laughs about the whole thing.  She is on the lookout: as soon as she finds someone else, the insolent fool will be gone.  She will not even flinch; just like she doesn't flinch from the spiciness of her food.

World Wide Web is 25! Oh, Baby!


Happy_birthday_by_babsdraws-d61xnoeOh, boy, World Wide Web!  You are 25!  So young, yet so much happened to you already! You are like a fucking child rock star!

When you were born, I was still in my 20s; so were Madonna and Michael Jackson; Brad Pitt was 25 (he just turned 50 – the jury is still out on whether you are good at math or not).  Now I run to you to roll time back and see people who witnessed your birth being young and alive – you keep them all and more inside your multitude of brains.

In only a quarter of a century that flew by with incredible acceleration you have spread yourself wide and deep.  You became a source of memories, references, entertainment, political battles, nationalistic agendas, a wide range of freedom and "freedom" fights, and the supreme motherbitch of it all – communication.  Oh, the connectivity of it! 

Just like other immature tech moguls born in the eighties you strive for world domination without any care about what you have and will destroy on your way to that lofty goal.  Just like them, you carelessly offer your services to those who uphold personal liberties and those who do whatever they can to extinguish them.

Talking about mixed emotions!  On one hand, it seems that I cannot exist without you and I don't even want to remember how I managed, oh, so many things before you were born.  Hey, you gave me this very outlet of self-expression!  On the other hand, I think you are a source of some major-scale evil; you made everyone more stupid; you will accelerate further retardation of minds and  degradation of humanity – all before you exhaust your own sources of existence (aka energy and servers' capacity) and bring life functions that rely on you to a grinding halt.  So, as much as I need you, I still keep my Britannica; I still buy hardcover books, CDs, and Blurays; and I still write checks.  I use you, but I don't trust you.  If I look closely I see that you are a sneaky creep.

What can I wish you on your 25th birthday?  What can you wish anyone on their 25th birthday?  To become a mature and responsible adult.  You go and figure out what it means.  I still didn't.