Interview with Elizabeth Miller
Interviewer: Andrew Zezas, SIOR
Following is the transcript of a CFO Studio interview between Andrew Zezas, host of CFO Studio and financial executive, Elizabeth Miller, CFO of Mauser USA LLC.
Visit www.CFOstudio.com to read about this interview and to watch the entire on-camera interview.
Finance for Non-Financial Managers
Zezas: This is CFO Studio, and I’m your host, Andrew Zezas. Joining us today in the studio is Ms. Elizabeth Miller, Vice President, Finance and Treasurer of Mauser USA.
Elizabeth Miller has been Vice President, Finance and Treasurer of Mauser USA since 2005, having previously held a similar position at Russell-Stanley Corp. She’s held various finance, treasury, and accounting positions at other companies since 1997. Ms. Miller holds a bachelor of science in business administration from the College of New Jersey and an MBA from Rider University.
Mauser USA is privately held and is a leading industrial packaging solutions provider. Mauser manufactures steel, plastic, and fiber drums as well as intermediate bulk containers. Mauser USA is based in East Brunswick, New Jersey, with multiple manufacturing facilities throughout the US and Canada. Mauser USA operates as a subsidiary of the Mauser Group based in Bruhl, Germany.
Today, Ms. Miller’s topic is Finance for Non-Financial Managers. Liz, it’s so nice to have you here on CFO Studio.
Miller: Thank you. My pleasure.
Zezas: Okay, so non-financial managers, operations, sells, customer service, we hear that very often they find themselves very confused about financial matters let alone financial reports. They find that such reports are written in a foreign language, but we know that in any profitable business, financial decisions impact almost every aspect of a company, and educating non-financial managers is a great way to improve decision making and increase a company’s profitability, so I applaud your efforts and very excited to chat with you about this.
Now, I understand that recently you visited a number of Mauser facilities for the purpose of educating non-financial managers on aspects of finance. Who did you present to?
Miller: We presented to essentially all of the plant leadership, so that would include the plant manager but also the customer service team, other members of the plant manager’s direct team, quality managers, production managers. We also included our sales teams in the presentations.
Zezas: You really covered the whole gambit.
Miller: That was our intent, yes.
Zezas: Wow. All right, so you presented to a wide swath of non-financial people. What drove you to develop the program?
Miller: The initial driver behind it was to get our plant managers to have a better understanding of what the key drivers of our P&L were. We have a great group on the operations team, fantastic group of people, but we found that within this group we had varying levels of financial expertise, so the plan was to really bring everybody up to the same level.
Zezas: Okay, so not only do a great job in manufacturing but keep the company profitable.
Zezas: Now, did you do this by yourself?
Miller: Absolutely not. I have a corporate controller, a gentleman by the name of Mark Schiavo, fantastic guy. I’m very lucky to have him on my team, and we developed the program together and also presented it together.
Zezas: Oh, wow, okay. The term non-financial manager, in and of itself, it really can encompass a very wide swath of people, and you just shared with me that you eventually went wide, but is that how you started or did you have a particular audience in mind?
Miller: Initially, it started out as just the plant managers were going to be our target audience, and then, as we began to develop the program and thought of the different things we should include, we thought all of these other people would benefit from having a better understanding of the key drivers of our profitability and also what drives our cash flow.
Zezas: Okay, got it. Talk to me about the main topics of the presentation. You weren’t trying to teach finance per se. You were trying to teach operations people about finance.
Miller: Correct. It was a very high-level presentation, and what we did was we really covered the three main financial statements, talked about the P&L, the balance sheet, and the cash flow. Focus was primarily on the P&L given the topic and what our ultimate goal was to drive profitability.
When we talked about the P&L, we went through the areas of talking about cost containment, and then also again what drives your P&L and taking a look at the various analysis that are controlling team does each month when we close off a period and how does that compare to a prior period and what were the differences a result of and how is it compared to your budget and what were those differences a result of.
Zezas: Okay, so truly tying operations and finance together.
Miller: Correct, and we also covered, when we talked about the balance sheet and the cash flow, the areas we focused on there rather than get into a broad look at the balance sheet and get into every little area, we really focused on working capital there and how their everyday decisions effect our cash flow, and the last part of a presentation would be to go through the different reports that Mauser puts out internally, and rather than just having them be something that show up in their in-box every month, we kind of went through them and said this is why we send out this report. This is why it’s important to you. Here’s what we want you get out of it. This is what you should be thinking about when you’re reading it and just to kind of tie everything together.
Zezas: I’m reminded of a story in the extreme of when the walls fell in the Soviet Union, and US economists went over to some manufacturing facilities in Russia and tried to communicate to those folks who manufactured things just because the state needed them to be manufactured and tried to communicate to those folks the concept of profit, and these people were trying to understand, “We’re supposed to make a profit?”
I know that that wasn’t the extreme that you had to contend with.
Miller: Absolutely not the case.
Zezas: I know that for a fact, but can you imagine having to communicate what a profit is? Anyway, okay, so this sounds like a very dynamic series of conversations. Were you trying to turn operations people into finance execs?
Miler: No, it wasn’t a recruiting mission on behalf of the finance group.
Miller: It was really just understanding the key drivers, and we knew from the start it wasn’t a technical accounting discussion. I knew from the start if we put up T accounts and started talking debits and credits, that would be the end of it. They’d be lost and on the Blackberry.
Zezas: Yeah, the Blackberry. All right. Presumably, you’re going to do this more than once, and you said you did this at a lot of different facilities. In the future, what would you do differently?
Miller: I think what we would do differently is in the beginning we started out where we had a large group and you would have a mix of operations and sales people all together. We would probably focus more on smaller groups, I would say no more than six, keeping the same functional areas together.
We found that as we went on and as we had some smaller groups involved, you tend to get more questions just because people are more comfortable at that point, and then when you get a question, it might lead to another question, and the whole dynamic changes itself from being a presentation to more of a conversation where everyone is talking about what drives the profitability and it’s a group discussion rather just me standing up there blathering on, yeah.
Zezas: Sure. Do you think that you might do this along unit lines or along department lines?
Miller: I think maybe more appropriately suited towards department lines, where we focus on what the sales team, how they can effect profitability.
Zezas: In multiple facilities, right.
Miller: In multiple facilities, sure.
Zezas: Right. That should be very good. Now, you did this recently, so it’s probably too soon to be able to measure this, but will you being doing this again?
Miller: The plan is maybe every other year, we go out and do a refresher course, maybe not cover the exact same things but same type of program.
Zezas: That makes a lot of sense. Okay. Can I take the conversation in a different direction?
Zezas: You’ve been a finance exec for a while. You’ve obviously attained some real success in doing it. You know what you’re doing and you do it well. There are a lot of folks watching this interview who aspire to achieve what you’ve achieved. What kind of guidance would you give them?
Miller: I think for me, the technical aspect that you learn in school, while it’s important to really be beneficial to your company, you have to learn what makes that company tick, and start from the ground up to learn that.
Zezas: Of course, they need to learn their craft.
Zezas: Of finance, but you’re saying it doesn’t stop there?
Miller: Not at all. You really want to be integrated into your business and learn what makes that profitable.
Zezas: You know, that makes a lot of sense, because I’ve talked before it’s always been our philosophy that especially middle market companies, a good CFO is really a COO. The diversity of a CFO’s role in an American company today is very vast, and we’re told that a CFO spends 20, 30, 40% of his or her time on true finance.
Miller: I would agree with that, yeah.
Zezas: That supports your argument about really understanding the business. Okay. Last question. We’re almost out of time.
Zezas: What do you do when you’re not being a CFO?
Miller: I spend as much time as possible with my 10-year-old son, who’s fantastic and the best part of my day every day, and I travel as much as I possibly can. I really enjoy it.
Zezas: You travel a lot?
Miller: I do.
Zezas: That’s wonderful. Liz, I want to thank you for joining us here on CFO Studio. I love the topic. It sounds like you’re accomplishing some great things. I wish you continued success, and I hope you’ll come back and see us again.
Miller: I plan to. Thank you very much.
Zezas: Thank you. This is Andrew Zezas, your host at CFO Studio with Elizabeth Miller of the Mauser Group, Mauser USA, saying thank you very much for watching. We’ll see you again.