How many of you believe if you could increase your income it would solve a lot of problems? My name is Joe Connors. I’m a middle-aged business banker and over the course of my career I’ve seen a number of business financials and personal financials. What I’m going to tell you is that focusing solely on income is a trap. I call it the Income Trap. I’m also going to tell you the same trap that applies to individuals also applies to businesses, no matter their size. And what I’m also going to do is show you a few examples of how focusing solely on your income could put your business at risk.
Imagine this scenario, your company didn’t make its earnings last quarter, and you as the CFO have the unenviable task of bringing those numbers to your leadership team. Everyone’s going to start talking and pretty soon someone will come up with the idea that you need to cut costs. Maybe you’ll even decide to use Lean to cut costs in your company. Well, you wouldn’t be alone. A recent headline from CNBC states, Coke goes Lean to cut 1200 jobs as part of an $800 million cost savings plan. Today, so many companies use lean to cut costs, that Lean has become a four-letter word in many organizations.
I liken mergers and acquisitions to terminal illnesses. We all either know somebody or have ourselves been impacted by a terminal illness and our outlook has been quite negative. I blame this negative outlook on the famous quote by Albert Einstein that goes “We keep doing the same thing over and over again, expecting different results”. This is also known as the definition of insanity.
At some point, you as the CFO are going to realize that you have responsibility over the tax function. This may come as a surprise, hopefully not, but it may. This will be the case whether you have an internal tax director or whether you rely on an outside advisor for your tax services. Your role will probably be a little more complicated if you’re relying on outside advisor. But in any case, you’ll have that responsibility. So knowing that you have that responsibility, you need to assess where your tax knowledge is; What do you know about taxes? What should you know about taxes? Do you think there’s a gap? How do you fill that gap? Well we’re going to talk about a few things here that will help you get through that process.
Some of America’s best run companies fail when implementing an ERP system. Andrew describes how three simple concepts; lead, limit and organize can make your system implementation a success.