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The Power of Passion

As Seen in CFO Studio Magazine Q4 2016 Issue

IGNITING PASSION IN YOUR CUSTOMERS AND EMPLOYEES CAN CREATE A WINNING BUSINESS

Most diehard sports fans will tell you they “eat, sleep, and breathe” their teams, but that’s not something you usually hear a finance executive say about his or her job. But for Frank Gumienny, CFO of the Philadelphia Eagles, it would be an understatement.

Mr. Gumienny attends all events at Lincoln Financial Field, the team’s home stadium, from each concert, lacrosse, and soccer match to every Eagles game. He even goes so far as to visit tailgate parties in the parking lot. He explained this, saying customer service is at the very heart of what he does. “Game days are very special to me because it’s an opportunity to spend quality time with those who are tied very closely to the organization.” He continued, “The fans are our customers, and they all come for the same reason. I take advantage of this time and use it in a way where I can engage and connect with them before the festivities start.”

Mr. Gumienny has been with the NFL franchise for 19 seasons, four as CFO, and every single day, with everything he does, he tries to build the passion for his team. “We are creating and cultivating a culture where everyone is an Eagle. Not an Eagles fan, an Eagle.”

He made these remarks on “CFO Leadership in Managing Operations, Finance, and Risk…69,000 Customers at a Time!” at a Middle Market CFO Dinner, part of CFO Studio’s Executive Dinner Series, held recently at Lincoln Financial Field in Philadelphia.

Those in attendance were surprised to learn that the CFO would be so involved with drumming up team spirit. “My whole job, this whole business, is about experience,” Mr. Gumienny said. “What we sell is passion and experience. I sell it, we all sell it.”

That resonated with Dominique Bernardo, CFO of Congreso de Latinos Unidos, a nonprofit organization that aims to strengthen Latino communities. “The personal touch of a CFO can make the difference in the experience of the consumer,” she said in an interview after the dinner. And she cautioned: “The CFO cannot afford to sit in the office and not be seen or not interact with staff and even customers.”

Mark Quinn, CFO of the Advertising Specialty Institute, a membership organization supporting the success of suppliers and distributors in the promotional products industry, said that he and his fellow CFOs need to recognize that they are in business to make their customers successful. “If you are committed to the success of your customers, it will be evident to them and your company will, in turn, be a success.”

This similarity with other businesses having been acknowledged, Mr. Gumienny made note of how unique his industry is: “Not many companies get their customers to show up on one day and share the same passion that others are showing,” he said. “They come wearing your colors, painting their faces, investing time and energy in what you do.” So part of the passion is already there, he said, but, “Our job is to continue that, to just keep fostering that passion, and above all, to show we care.”

Inside Out

To do that, he advised — and this can be done in any business — you start from within and work your way out. “Our staff members don’t just work for the organization, they are becoming it.” Mr. Gumienny added, “We do everything we can to instill that in the people we hire, making sure they come in with that attitude.” At the end of the day, “It’s just the mentality that every single one of us must have at all times and live out in every move we make.” To put it simply, he said, “Everyone inside the building has to feel the passion before anyone on the outside can feel it.”

This will only work, Mr. Gumienny pointed out, if employees are empowered. “I don’t believe that when you give people power, they abuse it. Most people want to do what’s right, and the right people are going to do the right things. If someone is going to abuse their power, you’ve got the wrong person.”

Mr. Gumienny continued, “When someone calls the stadium to see if they’re allowed to bring in an umbrella on game day, they are not talking to an operator, they are talking to the Eagles. So every staffer has to be empowered in the same way.”

Mr. Gumienny told the story of a stadium usher who went to his boss upon learning that a longtime season ticket member —whom he had seen at every home game for years — had died. The usher’s concern resulted in a memorial gesture for that fan’s loyalty to the team: “We removed the seat he had sat in and gave it to the family.” After all, said Mr. Gumienny, “that was not our seat, that was Grandpop’s seat.”

Mr. Gumienny said the usher was celebrated for knowing that this was something that should be brought to the attention of management, “which is impactful.” At the same time, the family will be fans forever. “We did this because it was the right thing to do, but the by-product is that they are fans for life. They’ll never forget it, and they’ll never let their kids forget it.”

William Curnan, CFO/COO of Advancing Opportunities, a provider of services and support for people with intellectual and developmental disabilities and their families, attended the dinner and in an interview afterward said he was genuinely impressed with the way the Eagles organization thinks of themselves and their fans as part of the team. “They build a home for them and they treat them like family, with respect and with pride to have them as fellow Eagles.”

Also in an interview, Curt Allen, Vice President and CFO of Subaru of America, made a comparison between his company and Mr. Gumienny’s Eagles. “The passion that the Eagles organization shows to their fans is what Subaru calls the ‘Love Promise.’ Subaru builds relationships with its employees, business partners, and customers by treating them the way we would want to be treated in order to create a culture with a sense of belonging.”

Close Encounters

This is something any business can do, Mr. Gumienny said in response to Mr. Curnan’s and Mr. Allen’s points: “Get your customers to feel that they are a part of the organization, to really be a part of it, and to get them on the inside, not just operating as a fringe player.”

Mr. Gumienny said generating devotion to the team is practically a mantra among his colleagues, “always on our minds as we go about our day-to-day,” and they take every chance they get to touch the fans and ignite the passion, be it on a grand scale or a very small one. “We might invite 500 season ticket members to the stadium to meet the new coach, or just one kid with autism to get an autograph from his favorite player.”

He said there are hundreds of opportunities to get tight with the fans and to bring them in closer to the Eagles, and “we go above and beyond at every turn, whenever we possibly can, to give them that ultimate connection to the team.”

This may sound minor, said Mr. Gumienny, but “guest services” at the stadium is now referred to as “fan services.” But that’s actually a big deal because “they really are fans, not guests, and we want them to feel at home when they come to a game.”

In an interview, Arlen Shenkman, CFO of SAP North America, the world’s largest enterprise application software company, expressed fascination over Mr. Gumienny’s varied and unique role: “his focus on the experience of the customer and how that experience weaves through everything the organization does, from finance to operations to game day.” He noted that every core operation within the organization relates to the customer experience. “It’s amazing to me that even the CFO is responsible for the quality of the experience a fan, a ‘customer,’ has on game day. But it makes sense.”

Mr. Gumienny said every single person who works for the Eagles is responsible for that experience, though he recognized that you can’t make all of the fans happy all of the time. “But if we continue to try to do what’s right, when we can get a win and make an impact, we definitely do it.” And that goes a long way, he added. “This kind of customer service really becomes who you are as a company. And we’re always mindful that each and every one of us within the organization has different powers to do that.”

The Business of Football

In addition to building the passion for the team and reinforcing a fan’s loyalty, “the goal of everyone on staff is to win,” he said, of what drives the organization and how it is ultimately perceived by its customers. “All decisions tie back to winning.”

He acknowledged that, “For most businesses the goal is to make money, but our primary goal is not to drive revenue and make money, it’s to win.” He pointed out that, in some ways, “You need to drive revenue and make money in order to win,” and that sometimes those two things are at odds. “Decisions to make you better on the field aren’t necessarily the same decisions that will make you money,” he said, citing an example: “We traded up to become the second pick of the draft, which comes with a much higher price tag than if you were 10th.”

In an interview, Anthony Conte, CFO of EPAM Systems, a provider of software product development services, commented on the business goals of Mr. Gumienny compared to those of his fellow CFOs. “At the core, we are all trying to accomplish the same thing, which is to make our companies the best in our respective industry. Obviously, we all go about that slightly differently, but that’s probably the one thing we have in common.”

Peter Miller, Executive Vice President and CFO of Binswanger Management Corporation, an international real estate firm, agreed: “As businesspeople, we are all trying to do one thing —more business.” He went on: “Even though the Eagles are a larger-than-life brand, it is still a business. And, like most of us, it fits the profile of a ‘big’ small business.”

In response to that, Mr. Gumienny said: “We’re not a business, but we’re almost a business.” He explained: “It’s the challenge that we’re faced with in dealing with the business side” of a sports franchise. “As CFO, you just have to balance conflicting needs and keep things moving in the right direction, which allows us to do whatever the owner and the head coach want, giving them every opportunity to win and be successful.”

Corey Smith, CFO of Dechert LLP, a global specialist law firm, attempted to sum up the discussion. “While Mr. Gumienny is in a unique industry and position, it’s clear that the role of an organization’s financial executive is ever evolving. CFOs becoming more involved outside the financial suite is critical and adds value to the organization, regardless of the industry or client base.”

Elaine Cheong, Senior Vice President and Senior Relationship Manager at Bank of America Merrill Lynch, and a CFO Studio Business Development Partner, echoed that. “We have observed over the years that the role of the CFO has evolved dramatically.” She added, “In the 25 years that I have been in the industry, CFOs are now acting very much like COOs. They’re no longer just the finance folks. The industry, and the world, really, is moving and changing very quickly.”

Not as fast as Eagles fly, but perhaps close.

Grounded

As Seen in CFO Studio Magazine Q4 2016 Issue Cover Story

A DOCUMENT FROM 73 YEARS AGO GUIDES THE DECISIONS OF JOHNSON & JOHNSON CFO DOMINIC CARUSO

-BY JULIE BARKER-

-PHOTOGRAPHY BY MATT FURMAN-

“OUR CREDO.”

So begins a four-paragraph statement penned by General Robert Wood Johnson II in 1943. “We believe our first responsibility is to the doctors, nurses, and patients, to mothers and fathers and all others who use our products and services,” it starts.

Paragraph three expounds: “We are responsible for the communities in which we live and work and to the world community as well. …We must maintain in good order the property we are privileged to use, protecting the environment and natural resources.”

These principles of corporate responsibility are chiseled into twin slabs of marble eight feet high and five feet wide at the entrance to Johnson & Johnson’s headquarters in New Brunswick, NJ. The same words appear at the entrance of all the J&J facilities around the world, and no matter how routine it becomes to see the words, everyone pays attention to them.

Dominic Caruso, J&J’s Executive Vice President and Chief Financial Officer, who joined the company in 1999, has long since internalized the Credo’s meaning. If a business leader calls him and says, “I need to speak with you about Our Credo,” it’s clear there will be little debate; the General’s words themselves will point to the right solution.

He got such a phone call in 2007, just months after J&J’s $1.4 billion acquisition of Conor Medsystems and its unique cardiovascular stent. At the time, J&J had 45 percent of the $6 billion worldwide market for coronary stents, according to a May 2007 article by MD+D (Medical Device and Diagnostic Industry). The unique stent was being offered in some foreign markets but had not yet received FDA approval. New tests, however, gave J&J reason for concern: A competitive stent was a safer choice for patients. “We withdrew that product from the market,” Caruso says.

Caruso, who was CFO of the medical devices business segment at the time, says walking away from the product’s potential was “gut-wrenching,” but it was a decision made “easy” by the Credo, which creates a structure for thinking about the implications of every action. J&J’s cardiovascular business leader at the time “knew this would be financially painful,” says Caruso. “But he explained the situation, and what he heard from me was, ‘Okay, I get it.’”

Throughout its 130-year history, J&J has earned a reputation as a top-performing company. Along with Microsoft, it is one of the only two U.S. corporations with a AAA S&P credit rating (beating even the U.S. government). On Fortune’s list of the World’s Most Admired Companies, J&J is the top-ranking pharmaceutical company, and in June J&J topped the list of Barron’s 100 most respected companies.

But hitting numerical benchmarks, Caruso insists, is far from the company’s primary motivator. When asked how useful and valuable it is for the company to have a moral compass like the Credo, Caruso doesn’t hesitate with his answer. “What Our Credo does for us,” he says, “is to require us to always stop and think, reflect, not to be simply reactionary to current developments, but to be grounded in our decision-making.”

Although the Credo cannot insulate the company from the realities that face leading global companies today — including litigation and regulatory challenges — it is an ethical platform and decision framework that the General, son of one of the founding brothers, felt would be needed when he took the company public.

Embedding Principles

“Our Credo has lots of constituencies: doctors, nurses, patients, employees, and our shareholders. Our shareholders are listed last, but it’s really just another of our responsibilities,” says Caruso, age 58. As CFO, he sees part of his job as helping the company grow through proper allocation of cash. Under his leadership, the company has articulated its disciplined capital allocation strategy. This begins by paying dividends to shareholders. Subsequently, he considers M&A opportunities, using about 30 percent of J&J’s free cash flow for value-creating acquisitions, and finally, share repurchases.

Another component of his role is to maintain an ethical organization by developing leaders in the finance area who live and breathe the company’s values as he does. J&J’s Finance Leadership Development Program (FLDP) is well recognized as a “leader feeder,” providing exceptional training in a two-year rotational program that gives young hires the chance to work in multiple areas of the business in three eight-month assignments.

The program has particular appeal to millennials, Caruso says, because it provides prompt, regular feedback, and with quick rotations, they are “not stuck in one place for a long period of time.” He says that J&J successfully recruits top graduates who might otherwise go to Wall Street or Silicon Valley by dint of its Credo and social responsibility activities. “[Millennials] appreciate when the organization they work for has a mission aligned with their values.”

Although he was well beyond entry level when he joined J&J, Caruso himself benefited from the company’s focus on talent development. After graduating from Drexel University in 1980 with a B.S. in Finance, he went into public accounting at Peat Marwick Mitchell, now known as KPMG. In 1985, he joined Centocor, a startup now called Janssen Biotech. He became CFO of Centocor in 1992, then added the role of general manager of that company’s diagnostic division. In 1999, Centocor was acquired by J&J. That’s when his own J&J development story began; two years later he became VP of Finance of its Ortho-McNeil Pharmaceutical subsidiary; and in another two years he was tapped for a bigger job.

“In the summer of 2003, I went to the office of our then CFO, Robert Darretta,” he remembers. “We were meeting to discuss succession planning as part of our normal talent-planning cycle.” It was a sunny June day, and the office was at the top of the World Headquarters Tower, with views over the Raritan River and the Rutgers University campus. Darretta started the meeting by reminding Caruso that “as part of our Finance leadership development priority, we are always looking for that key question we have about a leader’s ability to be successful.”

Darretta wanted to know if Caruso’s success would be transferable outside of pharma, where he had spent most of his career. According to Caruso, Darretta said: “We’d like you to take a role in our medical devices business. It will teach us more about you and teach you more about yourself.”

Caruso’s first thought was, “Why would I want to do that?” And even though it was a beautiful, clear day, he remembers imagining the storm he would be entering in a new, unknown environment.

As it turned out, taking that job was one of the best moves of his career. “I expanded my network and exposure across the company and was able to demonstrate my value beyond the pharmaceutical sector. Being new to the role allowed me to ask probing questions that my business partners may not have been asked in a long time.” He didn’t mind challenging the way things had always been done.

Leaving behind a niche he knew well and immersing himself in a far different one gave him an opportunity to say, “Wait a minute: What am I really good at?”

“We all have unanswered questions,” says Caruso. “You just have fewer and fewer of them as you go up the ladder.”

Caruso proved that he was good at leading, not just good at what he did in a particular sector. He was named CFO of J&J in 2007. At that time, the stock price was around $50; today it’s climbed to an all-time high above $122.

Long-Term Value

Caruso seems formal but comfortable during an interview and in between other pressing obligations. He is gracious with his time and articulate. We were in a small conference room down the hall from the office where he had met with Darretta 13 years earlier, talking long-term versus short-term value. A few weeks prior, Larry Fink, the CEO of BlackRock (which is one of J&J’s top-five shareholders), sent a letter to chief executives of the S&P 500 urging them to lay out for shareholders their value-creation plans each year. When asked his reaction to that letter, Caruso says, “First of all, I was glad that he called upon CEOs to take a longer-term view of their responsibilities to shareholders and to not be overly influenced by short-term thinking.”

Caruso notes that many of the shareholders he meets with are “long-term, loyal J&J shareholders,” though he does meet some who wish J&J would do more share buybacks. “That’s more of a trader mentality than an investor. The majority of our shareholders have more of an owner mentality,” he says.

“I think [Fink] was appropriately critical of companies that just react to short-term shareholder demands, and he was giving at least his endorsement to say, ‘Look, there are other shareholders who have your back.’ And that’s good to know.”

Caruso remarks that CFOs in the pharmaceutical industry tend to be more long-term thinkers compared to those in other sectors, because they are used to an environment where development times are drawn out. “You’re more patient, you’re making long-term investments, you’re continuously funding research and development to find cures.”

Later, he says one of the most exciting parts of his job is watching innovations become reality. For example, the finance team was involved in structuring a transaction with Genmab, a Danish biotech company, whereby J&J and Genmab would co-develop a drug for multiple myeloma. Subsequently, in 2013, the therapy received Fast Track designation from the FDA. Finance has been in the mix at each juncture in the product’s development, he says, and now the drug “is benefiting patients.”

Caruso has a deep personal interest in health-related causes. He is on the Board of Trustees of the Children’s Hospital of Philadelphia. His partner through 40 years of marriage, Debbie, also has a strong interest in the health and welfare of children. They have three grown children and nine grandchildren. Because one of his grandchildren has cystic fibrosis, Caruso became involved with the Cystic Fibrosis Foundation – Delaware Valley Chapter. He serves on the Board, and helps raise money to find a cure.

Besides being a family man, Caruso is a guitarist (rock, jazz, classical) and a golfer. He says he would enjoy having a superpower that enabled him to be in two places at one time. “If I could come to work and do what I love doing here, but also spend time at home simultaneously, that would be fantastic.”

The J&J organization has 50 other CFOs around the world reporting to him. They meet annually to discuss who is going to succeed whom, choosing from around 5,000 finance professionals in the J&J organizational structure. “I can’t possibly be involved in developing each of the 5,000 people,” says Caruso, “but I can be involved in the top 120 to 150 people: knowing who they are, seeing how they’re doing, making sure they’re answering those critical questions.”

Thinking about succession and giving the top picks the right opportunities “takes some time, but it’s really important because if I don’t get that right, when I leave, I haven’t really done a service to the organization,” he says.

Caruso doesn’t say so directly, but developing a successor who understands and will adhere to the principled business practices he has followed is how the CFO can best create long-term value.

In The Pressure Cooker

As Seen in CFO Studio Magazine Q3 2015 Issue Cover Story

A SUCCESSFUL IPO, AN UNSOLICITED TAKEOVER OFFER, AND A $163 MILLION WINDFALL YIELDED A VERY MEMORABLE YEAR FOR PINNACLE FOODS’ CFO

-BY JULIE BARKER — PHOTOGRAPHY BY MATT FURMAN-

For anyone who works at Pinnacle Foods, the six weeks that began on May 12, 2014, are unforgettable. During this stretch, the future of the company hung in the balance, as the fate of the Parsippany, NJ–based producer, marketer, and distributor of such American dining staples as Birds Eye frozen vegetables, Duncan Hines baking products, and Log Cabin syrup was kicked around far off in Chicago. It started with an unsolicited offer from Hillshire Brands, a Chicago-based food company, to acquire Pinnacle. “That was a really dark day in Pinnacle history,” says Craig Steeneck, Pinnacle’s 57-year-old chief financial officer. Fourteen months earlier, Steeneck and his finance team had borne the lead role in taking Pinnacle public. The takeover news ate at his sense of accomplishment. “It felt a bit like being a victim of our own success,” he says.

Now asked to lead the integration with Hillshire (whose brands include Jimmy Dean sausage and Ball Park franks), Steeneck believed that would be his last act for Pinnacle Foods. Conventional wisdom has it that CEOs and CFOs don’t usually hang around after an acquisition. “The prospect of leaving behind all that the Pinnacle team built was unsettling,” he says. For nine years, he’d put his considerable talent into helping shape, grow, and define the business. Disheartened, he made the trip to Chicago to “lay out the shell of what the integration plan would look like.”

Two weeks later, everything changed. Pilgrim’s Pride (a chicken producer, processor, marketer, and distributor) announced a bid to buy Hillshire. A couple of days after that, another shift occurred, when Tyson Foods (a global chicken, beef, and pork producer) topped Pilgrim’s offer for Hillshire—and a bidding war ensued. It soon became clear that the sausage maker, Hillshire, would be bought out by the highest bidder, which ended up being Tyson, and that Hillshire would not acquire Pinnacle.

Still, Pinnacle had accepted a legally binding offer that had not been officially withdrawn by the Hillshire Board, so the company was bound to the deal and continued to play along, so as not to jeopardize a significant break-up fee. “It was very disruptive,” says Steeneck. “We had to keep people focused on continuing to deliver the business. We carved out all the Hillshire activity and noise to a small group of people, so we weren’t distracting the rest of the team.” But the Wall Street Journal, the Star-Ledger, and CNBC, not to mention online news sources, kept the story alive throughout the six-week period.

Steeneck says that it wasn’t until July 1, 2014, when the Hillshire board voted in favor of taking the Tyson offer, and jettisoned plans to pursue acquiring Pinnacle, that the over 4,000 employees could raise a cheer for their independence and return to business as usual. Also, Pinnacle could then collect the $163 million break-up fee.

Why Pinnacle Was a Target

Pinnacle Foods manufactures products at 13 plants that it owns. Its brands hold the No. 1 or No. 2 market position in 10 of the 14 major categories where they compete. And, Pinnacle generates significant cash flow. “Our cash-to-earnings ratio is enormously high,” says Steeneck: 90 percent at year-end 2014. “That’s one of the characteristics of the Pinnacle portfolio that differentiates us from our peers. We’re able to convert earnings into cash at a very high percentage,” he says.

The Pinnacle business was created from a number of acquisitions (see Sidebar, this page). And the company continued to grow by buying brands that the nation’s large food companies deemed to be non-strategic. As a mid-cap company, with lower overhead, Pinnacle was able to put more attention into the brands it acquired, says Steeneck. Importantly, the brands were charged lower overhead than they’d been saddled with under prior owners.

In order to make those acquisitions and get solid returns from them, Pinnacle relied on tight financial controls and Steeneck’s oversight. In 2007, Pinnacle was acquired by The Blackstone Group and the focus shifted to building a company that could someday go public. Toward that end, in 2009 Pinnacle recruited Bob Gamgort as CEO and made its most significant acquisition, purchasing Birds Eye Foods. “That transaction was transformative for Pinnacle, as it virtually doubled our size,” says Steeneck.

When Pinnacle Foods created the prospectus, the S-1, that was filed with the SEC in connection with its March 2013 IPO, it was Steeneck’s finance team that took the lead, coordinating the efforts of in-house counsel and outside banking and legal advisors, to navigate the organization through this process. This grueling effort included compiling “a 250-page document containing extensive financial data, along with strategic and operational information that needed to be cleared by the SEC,” says Steeneck. Once cleared and with a compelling investor presentation in hand, he, Gamgort and Maria Sceppaguercio, who was brought in at that time to head up a new Investor Relations function, then articulated the story for investors during a 10-day investor road show.

Creating value by “Reinvigorating Iconic Brands” became the company’s mission, with a focus on prioritizing investment spending across the portfolio, expanding margins through productivity, maintaining a lean and efficient organization structure, and driving strong cash flow to create significant shareholder returns. Pinnacle emphasized during the IPO that acquisitions represented upside to the value creation the base business would generate.

“We operate in an industry and categories that are low-growth, but we’re able to create value by investing differentially in the highest-return brands in our portfolio, continuing to reduce our supply chain costs, and maintaining very lean SG&A overhead that minimizes the tax on our brands,” says Steeneck.

Investors responded well. The company priced the IPO at $20 per share. On March 28, 2013, the first day of trading, the stock (NYSE: PF) opened above that price and ended the day up more than 11 percent. Blackstone didn’t sell any of its shares at the IPO, instead choosing to hold for the significant value-creation potential it believed the company would — and ultimately did — realize.

A CFO With Good Chops

Until Blackstone became Pinnacle’s owner in 2007, Steeneck had spent considerable time fixing non-performing areas of the company with better systems and talent. In 2007, the focus changed to investing in the business so as to build a world-class food company.

His prior experience was extremely useful. Early in his career, he worked 13 years at Reckitt & Colman (now Reckitt Benckiser), becoming CFO of its North American operations. There he was involved in acquisitions of such brands as Woolite and Lysol to grow the company’s portfolio (and it was there that he met his wife, Sandra). He held his first public company CFO position at International Home Foods (Chef Boyardee, Gulden’s Mustard, Bumble Bee) and later joined Pinnacle Foods as executive vice president of finance, overseeing supply chain and IT.

Pinnacle had bought Aurora Foods a year prior, and was experiencing problems with customer service. Also, the logistics network was costing significantly more than industry benchmarks indicated necessary. “We had to put much better tools and processes in place, which we ultimately did,” he says. These tools and processes were critical in 2009 as the company embarked on the integration of the Birds Eye Foods acquisition, and in 2013 integrating the Wish-Bone business. “We fully integrated Birds Eye within six months and exceeded the acquisition plan on all key metrics. We had similar success with Wish-Bone.”

Today, two years after proving the company’s value with its successful IPO, Steeneck is still excited by the position he holds and the issues that come up. “I think the best part of my job is being a trusted advisor to the management team and having to be on my game day in and day out,” he says. “We are fighting for market share, we’re fighting for share of shelf, we’re fighting for quality employees, and we’re fighting for investor dollars. So there’s not much room for error. But we’re faster, we’re nimbler, we’re less bureaucratic. By making decisions faster in this world, we’re able to outmaneuver our competition.”

Looking Forward

When Pinnacle received the $163 million break-up fee, the company used most of that money to pay down debt. It also needed to ensure retention, so the company sweetened its bonus plan for the year and granted stock to all salaried employees who did not receive equity as part of their compensation. “One important lesson from the Hillshire event was how important it is for employees to be owners and have a direct stake in the company’s future,” says Steeneck.

The acquisitions that defined Pinnacle Foods’ growth over the course of the company’s first decade are harder to come by now. But it’s possible to improve margins by reinvigorating, for example, the male-focused TV dinner Hungry-Man with new flavors and combinations that can raise the price point: Fried Chicken and Waffles, anyone?

Steeneck’s finance team plays an active role in this sort of product innovation. Senior-level finance staff members are integrated into the business units in sales, marketing, and supply chain, with dual reporting responsibilities. Beyond costing out and evaluating new products, says Steeneck, “They’re involved in the development of the marketing and sales plans, and linking those plans to the supply chain.”

Finance team members are thus in a position to influence the brand teams to make better decisions, whether it’s forecasting sales or determining a future path. “You don’t want your finance team just looking in the rearview mirror. You want them working as cross-functional business partners to support better decision-making,” he says.

And Steeneck’s choice of people to support the commercial side of the business and help in the decision-making process gives him a maestro’s role in Reinvigorating Iconic Brands.