Henk Engelbrecht - CFO StratCorp: "The CFO needs to be a strategic thinker who understands the relationship between all the components of a business, its environment and the broader economy"
Henk Engelbrecht has only been acting as Group Financial Director of StratCorp since March 2011. It has been an interesting time so far. “I am a firm believer in not accepting the status quo and to always look at every aspect of the business critically to establish if there are better and more efficient ways of doing business.”
StratCorp was formed in 2000 and employs roughly 100 people. It is a South African investment holding company operating in four segments: financial products, health and welness products, general financing and property development. The company was listed on the JSE in December 2001. During 2007 the company transferred its listing to the AltX Sector of the JSE.
Henk qualified as a CA.SA in 1988 through then Rand Afrikaans University and did his articles with KPMG, for whom he worked from 1983 to 1990. The following 20 years to March 2011 was spent in Corporate Finance, first with ABSA from 1990 to 1999, Grindrod Bank (then Marriott Merchant Bank) from 2000 to 2008, and lastly with Vunani Corporate Finance from 2008 to March 2011. Henk joined StratCorp as the Group Financial Director in March 2011.
What do you enjoy most about your job?
I enjoy the strategic role the CFO plays in the organisation to enable the group to realise its goals and objectives. Linking the overall bigger picture with the actions that need to be taken and managing the cash flows around it is challenging, especially in the difficult economic environment we are experiencing currently.
To feel fulfilled in my work on a daily basis, I have to interact with people on a daily basis to ensure that all processes and operations are functioning optimally and that we are able to produce accurate results timeously.
How do you perceive the role of the CFO has changed in the last five to ten years?
The work environment has become much more regulated, especially if you operate in the financial services industry. The CFO has to keep abreast with all the regulatory and other developments to ensure that the group meets and complies with the various regulations. The CFO has become a "gatekeeper", interacting with persons with a diversity of technical skills, to ensure continued compliance and relevance.
How do you see the role of the CFO evolving in the next say five to ten years?
The CFO needs to be dynamic in the management of the overall financial function of the group, looking at optimizing the utilization of financial resources and efficiencies to extract value for all stakeholders. In future, the CFO needs to be more than a number cruncher.
Would you say that accurate forecasting and budgeting is still feasible for a financial department in today's tumultuous financial markets?
Budgeting and forecasting is still a very important tool for any business because it forces management to consider every aspect of the business model, looking at the impact of various business decisions on the profitability and cash flows of the business. Budgets and forecasts must however be flexible to allow the business to adapt to changes in the economic and market conditions, and I find scenario planning a very useful tool in looking at various potential events and the likely impact it may have on the business.
What do you see as the greatest challenge for South African companies in the global economic situation and for your industry in particular?
To remain relevant and competitive with the products and services we offer. One of the major stumbling blocks in South Africa is its labour laws and practices which makes it difficult for companies to plan and manage their labour force according to market conditions. The costs and inflexibility of the labour laws and practices forces companies to reconsider their strategies with regard to firstly investing in South Africa and secondly whether to employ people, which in the long term leads to an increase in unemployment.
We need to create opportunities for the people of South Africa to work and earn a decent income from it, which is one area that our company focuses on through the distribution channels we utilise to distribute our products and services, as well as the continuous training of staff, especially with regard to the provision of financial products and services.
Which skill(s) do you think a finance professional should master to be most successful in his work?
Today's CFO must have the necessary technical skills to be able to perform. He must also be willing to learn every day to stay abreast of the constantly changing environment he works in. The CFO also need to be a strategic thinker, to understand the inter relationship between all the components of a business, its environment and the broader economy.
Which achievement or project in your business career are you most proud of?
Being appointed the CFO of the company last year, because it allows me to contribute to the strategic direction of the group, and at the same time work with people where I can help them grow in their careers.
Please name something - a procedure or process for instance - that was implemented in your company before you were appointed CFO, which you changed after you took the position of CFO.
One benefit of new blood in a company is that they review existing procedures and processes critically, while getting to fully understand the business model of the company. I am a firm believer in not accepting the status quo and to always look at every aspect of the business critically to establish if there are better and more efficient ways of doing business. Over the year that I have been with the company that has been my approach, looking at every aspect of the business models, the business processes and interaction with the information technology department. The data capturing and reporting processes had to be updated to take account of new product lines that were introduced, simplify the business process to ensure an audit trail of the transactions that were captured, as well as producing relevant reports for the various businesses.
Who is your role model in life and why?
I learn from all the people I meet every day, some of which had a more profound impact on my life. But at the end of the day, I look for my inspiration from God alone.
What vital piece of advice would you give young ambitious finance professionals?
Look behind the numbers, understand the bigger picture and work hard and smart.
If you also would like to share your ideas with the CFO community, please get in touch with us to arrange an interview with you.Please contact Jurriën Morsch on [email protected].