managing the transformation of technological change

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#TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance #TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance Managing the Transformation of Technological Change Brian Kinion, VP Finance at Marketo

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Brian Kinion, VP Finance at Marketo, gives a keynote address at Armanino's Sixth Annual Technology Forum. He discussed moving from IPO to acquisition, the growing pains, the IT challenges and other topics pertinent to the financial organization.

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Page 1: Managing the Transformation of Technological Change

#TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance

presented by

#TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance

Managing the Transformation

of Technological Change

Brian Kinion, VP Finance at Marketo

Page 2: Managing the Transformation of Technological Change

#TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance

presented by

• Prior Experience

• SuccessFactors

o Cloud transformation

o Significant growth

o Multiple challenges

Shifting to the Cloud from On Premise

Page 3: Managing the Transformation of Technological Change

#TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance

presented by

Move to business leadership

Page 4: Managing the Transformation of Technological Change

#TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance

presented by

#TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance

SuccessFactors From IPO (2007) to

SAP Acquisition (2012)

Page 5: Managing the Transformation of Technological Change

#TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance

presented by The challenges………

and solutions

1. Transaction

Management

2. Controlling

the Business

4. Integrated Functional Excellence 3.

Planning and Analysis

Challenge: Number of Transactions

Challenge: Consistent process excellence

Challenge: Talent & Insightful Value Drivers

Challenge: Leadership & Performance Management

Source: slide 34

Page 6: Managing the Transformation of Technological Change

#TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance

presented by Our business requirements continued

to exceed our technical capacity

2007 2008 2008 2009 2010 2011 2012

IPO Early Follow-on Offering Reductions in Staff

3 Acquisitions and EITF 08-01

Plateau Acquisition

Planned Growth Acquisitions and Federal

Technical Capacity

Business Requirements

People, Process, Systems

GAP to close

gap

gap

gap gap

Page 7: Managing the Transformation of Technological Change

#TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance

presented by

IT Challenges

• CIO organization view of

departments owning,

implementing and

administrating their own

systems created “siloed

information” and master data

management issues

• Lack of integrated systems

• Lack of documented

process/policy

• Heavy reliance on Excel

Growing Pains: 2007

• IPO by “brute force” and “sheer

determination”

• Buried in transactions and

manual processes

• Significant deficiencies and

material weaknesses to

address

• Long-term under investment in

G&A functions

• Rebuilding financials while

being audited

Need to create order out of the chaos

and close the initial gaps

Page 8: Managing the Transformation of Technological Change

#TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance

presented by

System/process improvements while nailing

Transactions/Compliance/Control and becoming more efficient

• Noise level dramatically reduced with regard to transaction errors

• Added additional technical capacity across finance organization

• Addressed and remediated significant deficiencies/material weaknesses

• Added in-house NetSuite expertise and various system/process

improvements

• Reduced reliance on Excel

• Decreased day to close

• Completed two follow-on offerings

• Completed and integrated multiple acquisitions

• Changed audit firms and navigated an SEC comment letter

Making progress (2008 to mid 2011)

Page 9: Managing the Transformation of Technological Change

#TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance

presented by Systems improvements were helping

BUT...

• A/P workflow/process review; to reduce headcount/increase volume with Coupa

• US Concur roll-out with integrated credit card program (2010)

Procure to Pay

• Lockbox implemented for collections (2008)

• CRM transition from SFDC to Seibel to SFDC (Q209)

• Big Machines (quotes) (Q309); previously in Excel w/ manual approvals

• Avalara (sales tax) module (Q309); previously not charged/manual reserve

• Xactly (commissions) (Q109); previously in Excel

• OpenAir Implementation (Q210)

• EITF RevRec Module (Q310); support of EITF 08-01 adoption

Quote to Cash

• EquityEdge live (2007); previous in eProsper

• Switched from ADP to Ceridian payroll (2009)

Payroll and Equity

• Hyperion Planning (2008) to Host Analytics (2011)

• FAS (fixed assets) system (Q208); previously in Excel

• Netsuite cash reconciliations implemented (Q208); previously in Excel

• Clearwater (treasury analytics) system (Q308)

• Netsuite stabilization (2009-2010) and brought system administration in-house

• OneWorld (consolidation) module (2009); previously in Excel

• Consolidated # of outsourced International Accountants with Nair (2009)

Record to Report

Page 10: Managing the Transformation of Technological Change

#TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance

presented by

New Demands + New Idea = New Organization

• All the system/process improvements were done while we were doing our

day jobs

• Rapid growth and additional acquisitions raised more infrastructure

questions and if our current system landscape would scale

• Built business case for technology transformation and focused team to

make it happen

• Had established relationships existed across the enterprise which we

leveraged for cross functional system/process improvements

• Hired “black belts” and process oriented staff who brought new skill sets

such as project management/change enablement/training

• Built key dashboards in NetSuite for increased visibility to business

• Increased efficiencies and—eliminating manual efforts

We needed to scale to support a $1B

business

Page 11: Managing the Transformation of Technological Change

#TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance

presented by

#TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance

Page 12: Managing the Transformation of Technological Change

#TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance

presented by

Approach

• Defined scope and new technology landscape strategy to rip and

replace multiple systems

• 10 week implementation of all SAP OnDemand products

• Cross functional collaboration

• Re-engineered key business processes

• Clever use of interfaces and partner solutions

• Intense use of key user tools

Transformation process

Page 13: Managing the Transformation of Technological Change

#TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance

presented by

• Approach

• Defined scope and technology landscape strategy

• 10 week implementation of all SAP OnDemand products

• Cross functional collaboration

• Re-engineered key business processes

• Clever use of interfaces and partner solutions

• Intense use of key user tools

Transformation process

Page 14: Managing the Transformation of Technological Change

#TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance

presented by

A changed systems landscape

Prior to being acquired by SAP- 13 major systems in place

After being acquisition SAP- One Integrated System End State

SAP®

Sales OnDemand

SAP® Sourcing

OnDemand SAP® Travel

OnDemand

BIZX Platform / EC SAP® Contract

Management

Partner Solutions

BIZX Platform / EC

Page 15: Managing the Transformation of Technological Change

#TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance

presented by

#TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance

Marketo:

“I’ve seen this movie before”

Page 16: Managing the Transformation of Technological Change

#TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance

presented by

Asked what he wishes he had three years ago to make growth easier

today, Fernandez says he wishes he’d invested more in IT systems.

“We got behind on systems and we’ve been playing catch-up,” he says.

“I had the company so dialed towards growth and interacting with

customers, that we forgot a little bit about the back office.

“All of a sudden you wake up one day, you’re a $100 million company,

you’re public, and you’re pushing people to catch up.”

“We’ve been investing like crazy on systems infrastructure in the

business, which is amazing. Companies can grow faster than IT

departments can grow software.”

Smart Company (Nov 14, 2013)

interview with Marketo CEO Phil Fernandez

Page 17: Managing the Transformation of Technological Change

#TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance

presented by

These look very familiar…

• Heavy reliance on Excel

• Lack of system integrations

• Lack of documented process and policy

• Lack of maturity of systems needed to address being able to scale

• Impact on systems and financial modeling

• M&A execution and integration support

• Training, retention and development of key players

Marketo challenges

Page 18: Managing the Transformation of Technological Change

#TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance

presented by Poised for growth / scaling the business

Financial

Planning

Commissions

CRM/Service Cloud

Sales Tax Engine

Professional

Services

Automation

Marketing Automation

Quoting Workflow

Core GL/RevRec/Billing/Consolidations

Customer

360 View

Accounting for Stock-Based Comp

US Payroll

M

M M

M

M

M

Foreign

Bookeeper

Records

M

Complex Billing?

Procurement

Fixed Assets

M=Manual Upload

Page 19: Managing the Transformation of Technological Change

#TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance

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• Be a champion for change and continuous improvement

• Identify gaps in both systems/skill sets and close them

• Build strong relationships throughout the organization and leverage

them

• Partnership and collaboration are critical

• Have a vision and be a leader and a cheerleader as needed

• Be relentless and push your vendors for functionality and partnership

• Network, network, network

No two system landscapes will look the same!

Transformation advice

Page 20: Managing the Transformation of Technological Change

#TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance

presented by

#TECH4CFO Existing and Emerging Technology: How Strategic CFOs Are Transforming Finance

Q & A