Ted Baxter, CFO of Norton Rose South Africa, was educated in Harare, Zimbabwe and came to South Africa in 1982. After a short period in the banking industry with Nedcor, he joined a manufacturing company in the accounts dept and within 2 years became financial accountant. It was at this time that he embarked on his studies to become a Chartered Secretary and Administrator (A.C.I.S.) and qualified in 1988, being registered in United Kingdom and South Africa. He is also registered as a public practitioner with the Institute. Ted joined the Boart Longyear International Group, head office, and became the group's assistant company secretary, before being appointed as Admin Manager & a divisional director at Boart Longyear Research Centre, responsible for their financial and administrative affairs. The work was extremely varied exposing Ted to the world of technology and its application in business, the setting up of time and billing, special projects, costing systems and converting research from a cost centre to a profit centre, obtaining joint funding from the CSIR and the establishment of a research centre in Ireland through obtaining financing from the Irish government and the negotiation of tax incentives. Ted sat on a number of committees in the worldwide group including finance & internal audits and IT.
Having completed a Certificate in Management at the University of the Witwatersrand in 1992, Ted decided that he needed a more in-depth knowledge of other business functional areas at the strategic level and in 1994 he embarked on his MBA through the Graduate Institute of Management & Technology (G.I.M.T.) / Henley University, UK, completing it in 1998. Ted received a number of awards from Henley which included "Outstanding Academic Achievement in Strategic Analysis & Choice", "Outstanding Academic Achievement in Management of Projects" and "Outstanding Academic Excellence in Overall MBA Course", the first South African to receive this award from the University. His MBA dissertation is titled "The Use of the Internet by Law Firms to Gain a Strategic Advantage".
Whilst completing his MBA, Ted left Boart and joined in, one of the top ten largest corporate law firms in South Africa 1995, as Finance & IS manager, later to become General Manager of the organisation. His initial challenge was to overhaul the financial procedures, processes and systems of the firm to take it into the 21st century. This was then taken further by aligning the platform established with the strategic goals and objectives of the firm. Projects included the introduction of a new practice management system, cost recovery systems, reporting systems and the subsequent evolutionary process that takes place. This was supported by other systems designed to improve productivity and efficiencies in the firm.
Ted left the firm in 2000 to form his own management consulting practice, Portal Consulting Services, focusing on financial systems, workflow, procedures and policies, special projects, costing systems, ERP, Business intelligence(BI) systems, project management, special research and analysis to assist in the development and implementation of strategies, IT and systems solution projects.
During his career as a management consultant Ted also facilitated courses in strategy, ops management, financial management, info management, and knowledge management, to numerous blue-chip corporates in South Africa on behalf of a number of educational institutions (University of Stellenbosch Business School, University of Witwatersrand Business School, Graduate Institute of Management and Technology (G.I.M.T.), Henley University UK) and he wrote a number of articles, which have included topics such as e-commerce, integration of business systems, and the use of the Internet which have been published in financial and business journals. In 2005 Ted completed a course in e-tutoring and is accredited as an E-tutor on the Henley University MBA programme in Information Management.
In February 2010 Ted joined one of the leading law firms in South Africa, Norton Rose South Africa (then Deneys Reitz Attorneys) as Chief Financial Officer a position he holds today. Norton Rose South Africa employs over 550 people, 20 of which work on the financial department of the company.
What do you enjoy most about your job and why? What must you absolutely do every single day to feel fulfilled in your work and why?
- The challenging and diverse range of activities with great support from the finance team. Getting involved in all aspects of the business activities of the firm, influencing decision-making and problem-solving and ultimately getting positive results
- I am extremely task orientated. I set my daily goals and I absolutely have to complete them irrespective of the hours I have to work to achieve the results. My work is so diverse and because the environment is dynamic a key element is to continuously re-prioritise according to what is important to the business.
How do you perceive the role of the CFO has changed in the last five to ten years? How have you perceived that change in your personal daily business and operations?
Historically the CFO in most organisations focused on the numbers. Cost analysis, forecasting, budgeting, debtors, cash flows and the like. The value of a CFO was not unlocked. Now we see the CFO as a key contributor to the strategy and leadership of an organization and in many instances significantly more involved in all the functional operations of the business other than finance than before.
The CFO used to emerge every month from the depths of the accounts, hands clasped around a bundle of papers with minute printing to appear before the board of directors and announce to everyone how they had done before returning to the bowels of the organization. Now it would be unsurprising to the CFO involved in multiple areas of the business daily.
How do you see the role of the CFO evolving in the next say five to ten years?
The evolution of the CFO is already happening from simply dealing with the numbers to being an integral part of the business team, designing the strategy and implementing to achieve the results. The days of the back-room accountant are gone!
Would you say that accurate forecasting and budgeting is still feasible for a financial department in today's tumultuous financial markets?
Forecasting and budgeting is absolutely essential in organisations of all sizes. These are fundamental tools in decision-making and planning. Yes, volatile markets, weak economic environments make it difficult to get it right but the actual act itself of regular forecasting and annual budgeting forces all parts of the organisation to continuously re-evaluate where they are going, how are they doing, what's going on in our environment, what-if... Not forecasting and budgeting is simply burying your head in the sand like an ostrich.
What do you see as the greatest challenge for South African companies in the global economic situation and for your industry in particular?
South African Companies need to significantly improve their productivity. Different surveys on productivity in RSA all come to the same conclusion that we are behind the curve. If we can drive down the unit cost of production we can become more competitive globally with the knock-on effect of creating the jobs that we desperately need and we can genuinely become attractive to global corporations to invest in SA. And the investment I'm talking about is not putting it in the Stock Exchange but factories!
Another challenge for SA companies is the increasingly global regulatory environment. It can become a bureaucratic nightmare and is not getting better. Regulations that deal with KYC "Know your client" (money laundering legislation) are pervasive, environmental regulations, Carbon taxes, consumer protection have made doing business more complex than ever before and organisations have to seek advice on the jurisdictions they intend to business in.
In the legal environment there are significant pressures by clients to get more value for their legal spend. This not only refers to productivity increases, perhaps through commoditisation of certain legal work but also refers to the add-ons such as keeping the client up to date on legislation in the client's specific area of interest, workshops on new regulations secondments, talent management all without an additional price tag.
Globally we are also seeing many corporations with existing or planned international expansion goals wanting to deal with one firm wherever the jurisdiction. If your're not part of a global law firm you simply will not move up to the next level with the rewards that will bring and will fall behind.
Which skill(s) do you think a finance professional should master to be most successful in his work?
Regularly I hear that the fundamental requirement for success for a financial professional is "numeracy" - the ability to read the numbers and interpret them so that others understand. This also means that the individual needs to have strong communication skills. These are important if not critical skills but I believe that the key skill is "relationship management" or "people management".
A finance professional's success will always depend on his/her ability to motivate teams, co-operate and coordinate with other functional areas of the business and the ability to negotiate and interact with clients and suppliers.
I might add that hand in hand with the people management skills, I've seen that those individuals who make it their business to get to know the other aspects of the business intimately and are not purely focused on the finance and accounting functions are far more likely to succeed in an organisation. In a nutshell: work on your people skills and get to know the business you're in.
Which achievement or project in your business career are you most proud of?
Being a management consultant for over 10 years I was involved in numerous successful projects, ranging from the complete implementation of financial systems to supply chain ERP , cost recovery systems, cost accounting systems and all the modules in between to analysing new business opportunities, functional areas of business, designing of strategies. It is extremely difficult to identify which specific project I'm most proud of
I'm proud of them all.
I can say however that one project that I will always remember is when I was asked to analyse a business intelligence system that was meant to provide sales personnel detailed sales data to help drive their business. A colleague of mine, also in finance, and I, thoroughly investigated not only the systems but the financial data. The process even involved interviewing the users, in detail, about what worked for them, what didn't and what they would like. On wrapping up the investigations we kept on coming to the same conclusion . the system just didn't work and throwing money at it still wouldn't make it work. Quite simply there was no trust in the system. It was missing key financial information, the information was not always to hand, the presentation of the information was confusing and the mobility of the system was non-existent to name but a few problems.
We then had to present our findings to the Board of Directors. Not an easy job telling the board that they were responsible for throwing R Millions down the drain, that if they continued with the system they would spend more millions of rands without a guarantee of success and that they would need to spend millions on a completely new system ! They received the information with obvious shock and made a quick decision to embark on a project to build a completely new sales information system.
One of the most rewarding projects I undertook, also when I was consulting, when I was asked to investigate the real cost of a company's logistic operations. My knowledge of logistics was relatively limited to my studies and was in need of refreshing but I accepted the challenge and immediately obtained study material on logistics and spent 3 days updating myself. The project was fascinating involving building detailed financial models and what-if scenarios, cost analysis, alternatives, forecasting and capital pay-backs on various scenarios. The client was extremely pleased with the project and immediately set-up a working group to re-organise their entire logistics function nationally.
More recently at Norton Rose I was intimately involved in the project to merge the old firm Deneys Reitz into the new Norton Rose Group. A project that continued well after the merger actually happened June 2011 and was immensely satisfying and is delivering even better results than all our upside scenarios and expectations.
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.
The flexibility of an organisation to continuously change and improve itself is fundamental requirement of today's organisation. The CFO often finds himself in the seat driving change through new processes and procedures. I remember when I joined Norton Rose that I was frustrated at the end of every month, as were the team leaders, at the time it took the monthly team performance reports to be prepared, sometimes up to 4 days after month-end. The majority of the information was available in the system but was then extracted to Excel and adjusted. It was the adjustments that took the time. Team personnel movements, fee adjustments, allowances and so forth. I initiated a project to automate the process as far as the production of the reports could be. What a success from 4 days to 4 hours to produce!
Not all improvements need to be complicated; sometimes the simple but less obvious ones can reap rewards. For example we embarked on a process to change the payment of our correspondents from cheques being hand delivered to paying automatically via EFT. The benefits have been self-evident. Reduced potential for fraud, various manual processes automated and integration into cash flow with the knock-on time and cost benefits. Even though a process change may sound simple it may not be. The major obstacle in this project was convincing the multitude of correspondents that have funds paid directly into their bank account versus receiving a cheque had benefits for them too.
One of my pet hobbies is the study of information management and relationships between financial and non-financial information. What I mean by this is for example deliberately looking for patterns in information analysing the data and then making decisions that could lead to process and/or procedural changes. Studying this type of data provides me with numerous opportunities to drive change yes in processes and procedures but also at the strategic level.
One of the key issues that I have recognised over the years is to avoid change for change's sake. I have often heard the call that change is required to revolutionise the organisation and everyone sets off to make changes to improve their business processes to the extent that changes start getting made because 'everyone is changing', when they are totally unnecessary.
Who is your role model in life and why?
I have no specific role model in life. I do however strongly believe in ethical behaviour and, integrity. By integrity I mean values such as honesty, compassion, dependability, generosity, objectivity, trust and wisdom. Anyone who shares these values will be a role model to me.
What vital piece of advice would you give young ambitious finance professionals?
Finance professionals have a reputation for being intelligent and extremely hardworking and they generally are. However they also have a reputation for being cold, characterless even boring. Put on a human face!
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].
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