dave montgomery 2009

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Shanghai American School2009 Pudong High School Career Day

Dave Montgomery

CFO, Abbott Laboratories – China

February 20, 2009

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Agenda

• Background and Introduction

• Abbott Laboratories / Industry Background

• What does a CFO do?

• Positives / Challenges of My Role

• How does somebody get my position?

• Other Advice

• Questions – Open Forum

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Background / Introduction

• Dave Montgomery, CFO Abbott Laboratories – China

• BS, Industrial Engineering 1980

MBA, Finance 1985

• 29 years in workforce; 22 with my current employer

• US citizen Los Angeles, California is “home” now

• Working overseas since 1998

• Married with 2 girls ages 7 and 5 attending SAS Pudong

• NOT a Certified Public Accountant (CPA) and definitely NOT a “bean counter”

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Abbott Laboratories / Industry Background

“A Promise for Life”Abbott Laboratories

• Global healthcare company with sales in 2008 of $30B (over 50% from international)

• Headquarters: near Chicago, Illinois USA

• Key business segments include:

– Pharmaceuticals - Vascular Care

– Nutrition - Diabetes Care

– Diagnostics - Optical Care (2009 acquisition pending)• China

– Sales of $468MM in 2008 2009 target is 30 – 40% growth

– 2,000 employees representing all business segments

– Office locations in 10 cities

– Pharmaceutical and Nutrition manufacturing in country

– Top 10 global affiliate; #2 global Nutrition country (behind US)

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Healthcare Industry

• Broad and diversified; significant variation from country to country based on economic development, consumer sophistication, and government regulation

• Heavily regulated industry

– Product safety

– Medical claims

– Price controls / Government reimbursement

• Why consider this industry / career in healthcare?

– Rewarding: Patient quality of life

– Challenging: Constant change (operating environment, new product introductions)

– Stability, but need for innovation

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What does a CFO do?

• Chief Financial Officer (CFO) – senior finance professional in an organization

• Manages / Directs many of the following functions:

– Accounting / Controllership - Information Technology

– Treasury - Purchasing

– Taxation - Audit / compliance

– Financial Planning & Analysis - Administration / Real Estate / Insurance

• Activities focused on:

– Meeting / Achieving financial objectives for sales revenue and profitability

– Cash flow generation and financing the business

– Business analysis for new products, new markets, acquisitions, divestitures

– Accurate public reporting of financial results

– Compliance with tax requirements of local authorities

– Integrity of processes and procedures

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Positives / Challenges of My Role

• Positives

– Involved in every aspect of the business

– Direct leadership of key day-to-day execution of tasks

– Set long term strategy and vision

– Multi dimensional

– Cross functional (work with sales, marketing, scientists, lawyers, operations etc)

– Ability to educate / mentor younger employees

• Challenges

– Continuous change (economics, employees, customers, gov’t regulations)

– Industry perception

– Work / Life balance

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How Does Somebody Get My Position• There is no “standard” career path – many ways to advance

• First and most important:

– Build on a strong educational background, but well rounded

– Accounting / Finance / Mathematics

– Business / Human Relations / Economics / Social Sciences

• Financial heads tend to be “Generalists” not “Specialists”

– Breadth of positions as you progress (multiple disciplines)

• Accept new opportunities as they are presented to you

– New position (This is my 8th position in 22 years with Abbott)

– New location (my 6th location)

– Not every opportunity is a “promotion”. Lateral moves are OK.

• Take initiative for year career, but have reasonable expectations

– Work with your employer

– It won’t happen overnight (unless your dad owns the company)

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Other Advice

Characteristics that I look for when hiring

• Self confidence, but not arrogance or egotistical

• Verbal communication skills

• Willingness to continue learning

• Integrity (a must have in Finance / Accounting)

• Ability to work with others

• Good judgment / decision making ability

• Independent thinker

• Balance FOR ME THE MOST IMPORTANT

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Other Advice

Career planning

• Find something you enjoy doing; not what dad/mom want you to be

• Yes, money is nice, but it definitely is not everything or even the most important thing

• You can get an excellent education almost anywhere, not just Harvard

• Be willing to take some calculated risks with your career

• Don’t be afraid to admit that you’ve made a mistake get out of a career choice that isn’t meeting your needs

• The rewards of any career are what you make of them

– ENJOY IT…IT’S GOING TO LAST 40 YEARS OR SO

dave montgomery 2009

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