Interview: 'I Want to Be at the Front-End of Strategy'

by Cesar Bacani , 08 September 2009

0 comments

Facebook

Digg

Twitter

topics:
Management Risk Management

tags:
BT Global Services CFO finance function Germon Knoop strategy

In the past 24 years, Germon Knoop has been a managing director, MBA professor, management consultant and finance executive. Now Asia Pacific CFO for British telecom giant BT Global Services, he spoke to CFO Innovation’s Cesar Bacani about the role of the CFO after the global recession, risk management and other issues.

When the recession ends, do you think CFOs would be dealing with a very different business environment compared to pre-crisis?

The good thing is that a lot of companies were forced to look internally at their own cost base and become more efficient and effective [during the crisis]. Those companies will come out of it stronger and ready for the next move. They will be healthier coming out.

I think the whole hype in the past around private equity and quick investment exits, those are already changing.

The focus will be much more on actually operating and financially managing your business. The continued focus will be on cash flow, and I think there might be opportunities for companies to driving up shareholder returns by looking at acquiring business or pieces of businesses, at much better pricing than in the past.

Those companies that are going to come out of this stronger are going to look into consolidating other companies. I expect to see a further consolidations coming up after the crisis.

But I hope there will be a lot of opportunities for new businesses coming in as well. I really hope that the crisis will not have a negative impact on the entrepreneurship of companies and of individuals. We need to have entrepreneurs stepping up all the time.

There’s talk about more regulations, people being more risk-averse, banks being less willing to lend, fewer structured products available.

I would say that risk itself is the opportunity. Sure, people have gotten burnt, but perhaps they will not be making the same mistake. Perhaps we will all be a bit smarter and will be stepping up and doing the right thing.

As long as we don’t over regulate but use proper governance to come to the right business decisions, I’m actually pretty optimistic. When the finance industry is seeing these efforts and the confidence is back, I have no doubt that funding and investments will be available, for the right price at the right risk and return.

That seems to argue for a much more stringent risk management system. Do companies run the risk of losing their appetite for risk and entrepreneurship?

True. I really hope stronger risk management will not be turning into complete risk-averse behaviour. In order to improve your returns and margins, you still need to have the revenue and related margin coming in. As regional CFO, I am not risk adverse. But I like to understand what the risks are, what the mitigation is and how we manage the risk exposure. Then you can make a well balanced decision.

Especially in Asia, where economies are being re-oriented from exports to domestic consumption and markets like China and India continue to grow fast.

Right.

Do you think heads of businesses will continue to work closely with finance after the recession?

I hope that a lot of business heads will see the added value of finance, but it depends very much on the company, on the industry, the management team and the type of individual. I still see people in business who are not looking for that type of finance support. They are feeling threatened by finance taking up that role because it will probably reduce their scope of control.

Comment on this article

Your name: *

E-mail: *

The content of this field is kept private and will not be shown publicly.

Homepage:

Comment: *

Web page addresses and e-mail addresses turn into links automatically.
Allowed HTML tags: <a> <em> <strong> <cite> <code> <ul> <ol> <li> <dl> <dt> <dd> <a> <p> <span> <div> <h1> <h2> <h3> <h4> <h5> <h6> <img> <img /> <map> <area> <hr> <br> <br /> <ul> <ol> <li> <dl> <dt> <dd> <table> <tr> <td> <em> <b> <u> <i> <strong> <font> <del> <ins> <sub> <sup> <quote> <blockquote> <pre> <address> <code> <cite> <embed> <object> <strike> <caption>
Lines and paragraphs break automatically.
Use  to create page breaks.

More information about formatting options

Verification Code

This question is for testing whether you are a human visitor and to prevent automated spam submissions.

What is the fourth word in the phrase "owofe hayac mugir cesejuf ojihe"?: *

Accounting and Regulations

CFO innovation Asia Accounting and Regulation the Asia Pacific resource center for senior finance executives, daily news, analysis, best practice and case studies in Accounting Regulation, IFRS, US GAAP, Tax, investor relations, corporate governance, Corporate Law, Financial Regulators, Internal Audit, Audit, Corporate Law.

Auditing, Investor Relations, Law and Compliance, Tax

Finance and Banking

CFO innovation Asia, Finance and Banking the Asia Pacific resource center for senior finance executives, daily news, analysis, best practice and case studies in Corporate Finance, trade finance, treasury and risk management, capital expenditure, Banking, mergers and acquisitions

Cash and Liquidity Management, Corporate Finance, Insurance, Treasury Management

Management

CFO innovation Asia the Asia Pacific resource center for senior finance executives, daily news, analysis, best practice and case studies in Finance Management, Corporate Governance, Human Resource Management, Compensation and Benefits, Mergers and Acquisitions, Professional Development, Corporate Real Estate, Risk Management, Budgeting and Forecasting, Business Process Management, Business Process Reengineering, Outsourcing.

Budgeting and Planning, Business Expense Management, Human Capital Management, Outsourcing and Shared Services, Risk Management

Metrics

Corporates, Financial Services

Technology

CFO innovation Asia Technology the Asia Pacific resource center for senior finance executives, daily news, analysis, best practice and case studies in Finance Systems, Business Intelligence, EPR, Accounting software, CRM, Cloud Computing, Telecommunications, Business Process Outsourcing, Business Process Management Software.

Business Intelligence, Enterprise Software and Systems, Financial Systems, Security

CFO innovation ASIA