Stefano Valgimigli: Country CFO, ABB South Africa: "Stay hungry, stay foolish!"
Stefano Valgimigli: Country CFO, ABB South Africa, speaks exclusively to CFO South Africa about the ins and outs of being a CFO - and of relocating to South Africa, his experiences of the South African way of doing business and of the South African CFO landscape.
ABB (www.abb.com) is a leader in power and automation technologies that enables utility and industry customers to improve performance while lowering environmental impact. The ABB Group of companies operates in around 100 countries and employs about 145,000 people. ABB was formed in South Africa in 1992 and employs more than 1500 people.
Which skill(s) do you think a finance professional should master to be successful in his/her work?
A senior financial professional should have a good understanding of all financial matters i.e. Tax, Accounting, Treasury, etc., but not necessarily master them as there should be professionals taking care of these matters in structured organizations.
Mostly, I believe very much in the advice/support that a CFO can offer to the business; hence, it is very important for an F&C manager to get a deep understanding of the business, operational processes and customers. That would represent a plus to the organization.
What do you enjoy most about your job?
I believe that no ambition is precluded (in principle) if you have the best people and a strong organization. I really enjoy continuously assessing the status [of a business] and thinking on how to bring improvements in how responsibilities are assigned and people are organized.
What do you find most challenging about your position?
I relocated in South Africa from Italy in early 2011 so just settling in and getting an understanding of the peculiarities of this environment represented a big challenge. Local rules and regulations, customs, how people relate to each other and the "way of doing business" are pretty different from Europe. It took some time to get into them!
Which achievement or project in your business career are you most proud of?
There's a few things I can mention: in the past I was part of a big re-organization within some manufacturing units in Europe (within the same Group I'm working at currently); I took care of all the financial and KPIs benchmark background, ensuring that all decisions were taken on solid, objective bases and consistent with the Group's overall strategy.
I directly managed the implementation of SAP in one unit of the Group. It took some time to bring that cultural change up to speed, but it has been a sound basis for the future success.
Thirdly, I am proud of the basis I've founded here in South Africa on the F&C organization - reshuffling some people in different jobs and bringing new blood into the organization, covering some gaps and increasing the skills, responsiveness and overall knowledge of the organization.
Accurate forecasting and budgeting - is that still feasible for a financial department in today's tumultuous financial markets?
Accurate forecasting is for sure becoming more and more difficult, but it is vital as it helps follow up on the company delivery of the targets and define corrective actions. Furthermore, listed companies have to deliver reliable and accurate information to the financial community and the forecasting and budgeting process, including the target setting, is paramount to achieving their trust.
How do you see the role of the CFO evolving in the next five to ten years?
From one side, the CFO must be more and more involved in the business, as a good understanding of its dynamics can drive effective financial advice and support, eventually generating value for the company.
On the other side, the CFO represents a sort of a shareholder "trustee", so to speak, as he is the ultimate guarantee that the company behaves with integrity and ensures outstanding governance practice though solid internal controls, instructions and procedures.
In a world which has seen many financial scandals, getting the trust from these communities is vital.
How do you perceive the status of cooperation and lifelong learning between finance professionals in South Africa?
It is difficult for me to answer this question, as I do not have enough knowledge about the financial community here. As a general comment, I believe it could be very useful to promote cooperation and experience sharing opportunities. I think that even in Europe there is still some way to go. Most of the associations and guilds are more focused on accounting practices and less on a 360 degree financial professional job. I welcome such initiatives.
What do you see as the greatest challenge for South African companies in the current global economic situation - and for your industry in particular?
For sure, the Euro crisis could hinder South African economic development in some way, given the strong relationships between the two economies.
I am convinced that high level education is needed to exploit the full potential of this country. It must be wider, stronger and spread in all tiers of the population in order to prepare good professionals to help local companies to grow and compete in a difficult, competitive environment.
My company deals with infrastructure, which is also a big challenge here and represents an inescapable matter for the future development of the economy. In this sector, quick and transparent decision processes are vital.
Who is your role model or mentor?
I do not have a specific one; I was lucky to have many outstanding bosses who gave me invaluable support.
What vital piece of advice would you give young ambitious finance professionals?
A well-known guru[i] would answer: "Stay hungry, stay foolish". I'm not that kind of guru, of course, but I am convinced that even in a typical "rational" and "feet on the ground" function like Finance these words do make sense.
A solid rational finance professional, with an economics-driven decision mind-set coupled with creativity and attitude to see problems from many different angles, can represent a fantastic change agent in the most complex organizations.
Build your solid knowledge in the finance function first and try to expand it in your management skills by thinking "out of the box" from time to time!