Interview with Drew Reina
Interviewer: Andrew Zezas, SIOR
Following is the transcript of a CFO Studio video between Andrew Zezas, CEO of New Jersey based Real Estate Strategies Corporation and financial executive, Drew Reina of Ajilon Finance Solutions.
Visit www.CFOstudio.com to read about this interview and to watch the entire video interview
Trends in Finance Executive Career
Zezas: Hi, this Andrew Zezas, your host at CFO Studio. We’re here today with Drew Reina, Managing Director of Ajilon Solutions. Drew has a host of information to share with us about the current status of CFOs and the CFO industry. Drew, thanks for being here at CFO Studio.
Reina: Thanks for having me Andy. I’m delighted.
Zezas: My pleasure. Drew, we had a chance to chat before, and you had some great insight as to what is happening in the world of CFOs. Let’s start off by the easy one. In the last 20 years, what’s evolved, what’s changed in the world of finance executives?
Reina: I think for starters, the CFO has gone from a broad based sort of position where it’s concentrated on tax, audit, and compliance. The complexity of what they’re faced with today is a completely new evolution; their responsibilities, the level of disclosure, the scrutiny. Everything that is placed on them is an entirely new ballpark.
Zezas: You know it’s interesting. In earlier interviews today, we’ve had a couple of folks talk about the new role of a CFO actually being that of a COO, but they only get one salary.
Zezas: Now, the recovery’s taking hold where we’re starting to begin to see some real traction. We’re starting to see some positive effects not only in the industry, but also in employment markets. What’s happening with CFOs who last year were afraid to move and were happy to have a job?
Reina: Well, we started to see a shift in the paradigm where historically they were very comfortable in the role. Everybody had this hesitation where, even for looking at new opportunities, they were very hesitant to make a jump. We’re starting to see a migration, [with finance positions] starting to open up a little bit more from a demand and opportunity standpoint. So, the hesitation is not quite as bad as it used to be. So, there are a lot more CFOs now looking to make that move into the next step.
Zezas: So, they’re feeling more confident that the opportunities are out there and they’re not just worrying about having a job. They feel that it’s time to make a move and it’s time to spread their wings.
Reina: Exactly, and I think they’re confident with what they’ve been through over the last year or two, that the value that they’re bringing to the organizations is real. So, they’re looking to transfer that.
Zezas: You’re not just talking about CFOs only you’re talking about VPs of finance, treasurers, controllers, up and down the whole scale. So, what does that mean to the office of CFOs, if now finance executives are actually starting to look around? What does that mean from an operating perspective, even a financial perspective?
Reina: Certainly, [it means “concern’]. You know, a lot of companies started out there with a skeleton crew over the last year or two, where they shifted away a lot of their staff. They did not have the internal resources. They’re kind of delivering with bare bones, so now to have those individuals take on new opportunities and leave, leaves them even further exposed from an operational standpoint. They’re not going to have the bandwidth and the resources they had yesterday, as they’re moving, and now you’ve got the entire ramp up time to move folks on, to train them, develop them. It’s going to be an interesting time.
Zezas: Ramp up time with a skeleton crew.
Zezas: And, there’s probably no one sitting around looking for something to do. And, it makes it even harder to train the new employees.
Reina: 100% correct.
Zezas: Ok, wow! So, now we’ve got people out looking for jobs. I hear the debate all day long: You should be a specialist, you should be broad based! And, a number of finance execs think that they should offer themselves on a broad basis and create greater opportunities for them to pick and choose as the jobs go by. Do you ascribe to that perspective?
Reina: I don’t. I think it’s one of the misconceptions that’s out there, because if you look at the positions and the demand that’s out there today, the new CFOs and the roles that they’re taking, board of directors and senior executives are looking for very precise subject matter expertise. So, the life of the broad based CFO, well it’s great to have a well-rounded individual that can touch different operating pieces, the reality is that they’re looking for those individuals that have very specific honed skill sets.
Zezas: So, the idea of the eight year job is out the window.
Reina: Absolutely! Two years at the most.
Zezas: Ok, wow! So, a lot of upheaval in the industry, not only in the employment side, but now we’re dealing with accounting reform, IFRS and lease accounting…everything’s changing. With everything that’s going on in the world, how is accounting reform changing the company’s view of performance?
Reina: Well, a lot of companies are looking to evaluate performance based on what is the overall return. Historically, it was very much compensation driven, base-salary, either stock based performance or they would look at it and they would get an annual incentive based on the profitability of the company. So, now as we’re starting to pull some of these layers apart, we’re drilling further and further down to the net operating profit of an organization. CFOs are being more tied into that based on the economic value-added. So, from a performance perspective, what used to work yesterday, now they’re being tied specifically into opportunity cost and weighted average cost of capital. Backing all those items out, what is the true return of the organization?
Zezas: Wow, talk about a new normal!
Zezas: We’re almost out of time. This has been very insightful. If you had to leave our viewers with one thought, specifically with CFOs, either about what they should be thinking about, as recovery really picks up speed, on behalf of the company or in terms of their own career, what would you say?
Reina: I would look at bandwidth and risk. At the end of the day, there are all these organizations that are out there that we know are operating on skeleton crews. We’re looking at business transformation opportunities, how to evolve that CFO and that company into the next level. So, as a result of that, they’ve got to look outside some of the traditional methodologies that we’ve had and really try to hone in on what could take them to the next level. I think looking at the new regulatory compliance and everything that’s out there, it’s a new dynamic. So, they need to be nimble and they need to be quick.
Zezas: So the watch words are “nimble and quick”.
Zezas: And, something about a candlestick.
Reina: And, a candlestick, a quick jump over it.
Zezas: Drew, it’s been great having you at CFO Studio.
Reina: Andy, it’s my pleasure.
Zezas: Thank you for being here. This is Andrew Zezas, your host at CFO Studio, saying thanks for watching. We’ll see you again.
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