Count Me In® Ep. 130: Keith Terreri - The Intersection of a CFO & CIO
Contact Keith Terreri: https://www.linkedin.com/in/keith-terreri-595b4bb/
NEC Corporation of America:
FULL EPISODE TRANSCRIPT
Adam: (00:05)
Welcome to episode 130 of Count Me In, IMA's podcast about all things affecting the accounting and finance world. This is your host, Adam Larson and today I'm pleased to introduce our featured guest speaker, Keith Terreri. Keith is the Chief Financial Officer and Senior Vice President of corporate operations, and IT for NEC Corporation of America. In his double role of CFO and CIO, he has developed a wealth of skill and knowledge necessary for effectively overseeing and managing accounting, FP&A, supply chain management, corporate operations and IT. In this episode, Keith describes the convergence of these two pivotal roles and explains the value each team brings to the business regardless of the organizational size. Let's head over the conversation to learn more.
Mitch: (00:57)
So our listeners are well aware of the changing role of the CFO. It's something we talk about all the time, you know, the need for a strategic foresight decision-making business partnering is something that's very popular. A lot of this is due to the evolution of technology, but you have a unique role. You have a double role of CFO and CIO at NEC. So what does this convergence of the two roles really look like to you on a daily basis?
Keith: (01:22)
Thanks, Mitchell. That's actually a great question because it's certainly different than when I was just CFO. The convergence of these two roles, it's actually been a very eyeopening experience to say the least. So the convergence has come with some great synergies, and also a significant amount of risk management. From a synergy perspective, obviously our back-office functions of OTC, which is order to cash, PTP, which is procure to pay and record to report, or RTR have been greatly enhanced, right? So finance corporate operations, and IT are all one team now and communicating regularly. The interaction in visibility for both groups has been fantastic as one team and under this scenario, we work on a daily basis to make sure not only our ERP is running smoothly, but also our network and data is secure. For a risk management perspective, obviously cybersecurity has become a major part of all IT team's responsibilities over the last several years and now it's a part of daily operations for companies. However, in this dual role it's been becoming increasingly clear to me that cyber security is everybody's responsibility, not just the IT department. As everybody knows, ransomware attacks are very prevalent right now making cybersecurity the utmost importance on a daily basis. So we constantly monitor our network for security purposes and many companies are moving towards a zero trust approach from a cyber security information perspective and so that is also part of our daily discussion. Customers are also getting much more stringent, you know, on their contract requirements, requiring information security clauses in the contracts with us, so that we have to be very cognizant of that as well. So now we are very involved as we continue to make contracts with our customers. So, I mean, all in all it makes for quite a different daily routine than just finance.
Mitch: (03:32)
Well, as far as finance goes, you know, I know much of your career prior to this role, prior to taking on CIO also was specifically in the finance function. So talk a little bit about how those experiences and those skills helped you prepare for the responsibilities you just discussed and what you've taken on involving IT.
Keith: (03:51)
That's another great question, Mitchell, thanks. I mean, primarily, it was really my training in risk management that has helped me the most. Always concerning myself with the downside of either operational or finance issues has been very helpful throughout my career and now with that, the added responsibility for IT, thinking about the downside, or any type of issues from an IT perspective, has really been a good mix for me. Also having had experience in cyber liability insurance probably since it started, or when it was first offered, I've almost kind of grown up with that. So as a CFO, financial risk management is very important and frankly cyber risk has become, definitely become a financial risk to everybody these days based on all of the cyber activity that's out there in the world. I mean don't forget, I mean risk management is not only for services you provide to your customers, but also for your own network and your data. So you've got two things you have to look at from a risk management perspective and we do this frankly, on a regular basis. So when you think about all the, you know, traditional finance experience, most of the times the CFOs are responsible for risk management insurance. I think that the cyber liability insurance, which is changing rapidly as we've seen in the last month or so is very important for both the CFO and the IT guys to understand completely. I particularly, if you have a chief information security officer, that employee needs to be very familiar with how the policy works, if you should ever have a claim.
Mitch: (05:34)
Now, oftentimes because of the risk management perspective, you were just talking about how that falls on the CFO's shoulders. They're usually responsible for forging a relationship with the CIO because of the cyber security, cyber liability, things like that and the joint relationship is responsible for handing the priorities of finance and IT individually. We spoke a little bit your role prior to this call and, you know, you serve both. So how do you really communicate the needs and further support the relationships of two different teams as one person?
Keith: (06:08)
So this was definitely something I wanted to focus on when I took over IT three years ago. And I really think, you know, as a CFO and being able to look holistically at the financial statements and also preparing our annual budgets and forecasts, it becomes slightly easier to allocate resources for cybersecurity and for IT initiatives. There's no longer in my mind, right? In the way we have things set up a competition for funds or resources between finance corporate operations and IT. So it really makes for a more collaborative approach on resources so that when we prepare our annual budgets, we go together as a team and we've already kind of vetted out, you know, the priority of funds and funding for resources. The entire team discusses and ranks the needs so that we're all in sync. You know, one of those slogans I adopted early on with the finance team was “we're all IT now”, and that has really helped kind of change the mentality and increase the collaboration between the two groups. I mean, under this type of scenario, there's no longer any finger pointing and everybody accepts accountability. You know, in a traditional scenario where you have the two teams separated, in a traditional scenario, there separation of these two teams can create friction, which is not necessary in today's ultra fast paced business world. The entire leadership team of finance and IT, and corporate operations meets once or twice a week. They think that's an update from my perspective, but really it's for them to interact and update each other so that we're all on the same page and so no one person can say, “I didn't know IT was doing this”, or “I wasn't aware of finance wanted to do that”. And this communication has brought foresight and respect,...