Speaker 1: 0:11

Welcome to Unfazed Under Fire, a podcast designed to elevate your leadership and amplify your impact. Each episode offers valuable insights to help you transform your vision into reality, cultivate high-performing cultures that attract top talents, and navigate the complexities of today's uncertain, chaotic world with confidence and clarity. Now tuning into your needs, here's your host and moderator, seasoned executive coach and leadership alchemist, david Craig-Utz.

Speaker 2: 0:46

Welcome back to Unfazed Under Fire. I'm David Craig Utz, the leadership alchemist, the host for this show and your guide on a journey to leadership mastery. This show is dedicated to helping executives like you enhance your leadership impact, not just by refining your strategies, but by transforming the very essence of how leadership is understood and practiced to ensure you're always on the cutting edge. Here we challenge conventional wisdom, exploring breakthroughs in the development of leadership and organizational culture. We aim to give you insights that resonate deeply with the challenges and opportunities you face in the executive suite.

Speaker 2: 1:21

We believe that in creating workplaces that are not only productive but also uplifting, where your people can be inspired to give their best in service to your organization's mission and key priorities, our approach is grounded in the reality that true leadership begins from within. Whether you're aware of it or not, the truth is that every human being possesses the resources needed to overcome the most daunting challenges, and this resources is accessed through the journey of self-mastery. Such self-mastery lays the foundation for leading others with clarity, purpose and grace. Today, leadership can be can quickly become confusing and frustrating without such mastery and a connection to one's inner compass, because of the turbulence and uncertainty we're facing in the world today, thank you. To add to our esteemed list of guests With me is Karen Demichelis, CFO of Superstores Industry. Karen, welcome to the show.

Speaker 3: 2:30

Thank you for having me here, Great.

Speaker 2: 2:33

Now I'm going to say a little bit about you, just give our listeners some flavor of who you are, which is a pretty robust background. Karen is a visionary CFO and CEO advisor with over 25 years of experience driving transformation change across diverse industries. Currently, she's serving as Chief Financial Officer at Superstore Industries, where she oversees the financial strategy and operational leadership of $1.2 billion joint venture between Northern California's largest grocery retailers. Her ability to lead high-stakes mergers and acquisitions, coupled with her innovative approach to financial planning and analysis, has consistently delivered sustainable growth and operational excellence every company she's been a part of. Beyond her corporate accomplishments, Karen is also a dedicated educator, with over two decades of experience as an adjunct faculty member, where she has shaped the minds of future business leaders. She's a true pioneer in her field and she has successfully integrated AI technology into business processes to enhance transparency and efficiency.

Speaker 2: 3:38

Karen's commitment to fostering transparency, integrity and accountability is a testament to her holistic approach as a leader and I'm thrilled to have her on the show today. A testament to her holistic approach as a leader, and I'm thrilled to have her on the show today and to have her share her insights and experiences. She currently lives in Escalon, California, a small farming community just east of San Francisco and in her spare time enjoys riding bikes around the beautiful area there. So, Karen, I trust I got that right. Is there anything else that you'd?

Speaker 3: 4:02

add. No, I think you nailed it. I appreciate that. Thank you.

Speaker 2: 4:08

Great. Well, you know, I remember on our design call for the podcast you shared about your career journey that started far away from finance. So I'd love because I always love to hear people's stories, because it always doesn't start where it currently is Right love to hear people's stories because it always doesn't start where it currently is right. That's just the nature of life. So I'd love it if you could talk to you a little bit about you know, your early education and how that evolved to you now becoming such a successful CFO.

Speaker 3: 4:37

So, david, I'm probably your typical college student that every parent fears they will get. College student that every parent fears they will get. You know, changing majors every semester based upon whatever was easiest or most inspiring at that moment. So I went to Santa Clara University and while there I became an English major. I finally had to settle into a major my junior year. So I became an English major and I was studying Chaucer and Milton all very useful topics. It's not like I was doing technical writing or something functional. I'm doing a lot of poetry. I learned Renaissance guitar and remember. You know, as I was going through all of this, I was great for the coffee, the emerging coffee shop culture, but not so much with the campfire crowd and certainly not with potential income.

Speaker 3: 5:38

And my parents were starting to feel a little concerned. They knew I didn't want to be a teacher. Mom was a retired teacher. She'd put in 50 years. Finally, when she did retire, dad was a farmer and he knew I wasn't going to be a farmer. My roommate said hey, karen, why don't you come take the GMAT with me? And this is in the days before you had to pre-register. And I said sure, why not? One of many? Sure, why not? Moments in my life. And so that that started it.

Speaker 3: 6:08

So I went, I took the GMAT. I ended up being having outreach to me by the Agribusiness Institute Now I think it's the Food and Beverage Innovation Center, but it is a subset of the Santa Clara MBA program which was focused on agribusiness studies and policy. So I found myself that very first semester taking graduate level calculus and intermediate algebra concurrently, because I needed to have a passing grade in algebra so that I could pass, that I could complete my coursework and keep in mind I was an English major. You know studying, you know very English-y type of material, and the only math class I had was math without fear for English majors at the community college level. So I adapted and you know, as we talk about this, you'll hear me talk a lot about, you know, adaptability and being able to respond with the moment, and so this was the first of many major adaptations around my career was just a spontaneous moment, you know, let's go take the GMAT and there I am.

Speaker 2: 7:21

That's great. And here you are today, and then you've had quite a career in finance. You've crossed many kind of different kinds of businesses, from being a finance manager at PepsiCo to now being CFO of this joint venture that you're involved in. How, would you say, is that kind of tapestry work together to make you, you know, to form your financial leadership today? How would you describe that, how that all came together?

Speaker 3: 7:51

Yeah, you know there's been some consistency in my career. As a friend once said, Karen, you've spent a lot of time putting liquid into containers.

Speaker 2: 8:01

And.

Speaker 3: 8:03

I think, whether it's oil and gas or, um, you know, consumer products, um, there's some truth to that. But as I think about the skills that I take, whether it was in you know, you heard me talk a little bit about adaptability is that ability to um the three things that stand out to me in my career as being the adaptable, being resilient and being authentic and adaptable We've talked a little bit, you know. It's just being open minded, curious and flexible. It's having some of those, those sure, why not? Moments, and I don't mean to make that sound lackadaisical, but it's more like let me try that, let me experiment with that, let me see how that fits.

Speaker 3: 8:50

You know, maybe that's the right path. Resilience is that ability to sustain under pressure and cope with disruption and friction. You know we all have. That, you know is that you hit a wall. Are you going to like, turn around and go the other direction, or are you going to figure out how you're going to get around that wall? And that ties back to the adaptability and the third area that I think has been very critical to my career path and it's transcended everything is authenticity and I haven't been 100% authentic over my lifespan.

Speaker 3: 9:27

I don't know anyone who has, because there's been interruptions there, but when I am authentic, when I am most comfortable with myself, is when I do best, when I am most comfortable with myself, that's when I'm most able to lift other people. You know, and we all have those inauthentic moments that shape us and we're not at our best. Whether it's divorce, maybe it's a transition out of a job that's a little bit bumpy, you know, life happens right. But as long as we come back to our core and we stay authentic to our true selves, and then you blend that with adaptability and resilience, I think that for me that's been the magic beans, the recipe for my success, and those are the essential skills that really helped me.

Speaker 2: 10:22

Yeah, I love that. I mean, to me, the whole description of the path to authenticity is a pathway. We come into our 20s, right, and we tend to wear superwoman or Superman suits at that time, like we could do anything. And then we get hit a couple times in my life and then we start saying maybe I have to act differently to get what I need, and then that doesn't work. And then we come back. Eventually we do come back to ourselves and we come back to ourselves. That's when everything does work better and and as you, as you get the flavor of that, you know when you've been. Then you start knowing when you're away from it, that didn't feel right.

Speaker 2: 11:01

How do I get back to that place where I felt whole and in myself and also all those kicks in the gut and those changes and everything? You either get to a place where you say yes or you start being reserved and cautious and saying no and you realize, as I realized in my own life, I got into a habit at one point in my life where I say, nah, not that, I'm not going to do that, I'm not going to do that. Things would come to me and I wasn't saying yes. And that was really a learning moment for me, because I got behind the eight ball in my business, because I wasn't saying yes, because I thought some of the work that was coming to me was quote unquote below me. That was my arrogance at the time and now I've learned from that.

Speaker 2: 11:37

Now I say yes a lot more because as long as it's inconsistent with what I'm here to do, and then also having those experiences of resilience are so important, especially today. I mean, we're getting kicked in the gut every day with things that are happening in the world and we just have to keep on leaning into what can I do about it? How can I have impact? Where can I step in and make a difference? Right, it's very beautiful, and you've also been a teacher for many, many years at adjunct faculty at a number of different universities systems and teaching various business courses, and you know what drew you to doing that and how has that experience as an educator supported you in your approach to leading others? Just curious.

Speaker 3: 12:17

Yeah, so you know, I started off saying I didn't want to be a teacher, right, and that is true. It wasn't intentional. Again, get back to sure. Why not moment Back in around 2000, 2001,.

Speaker 3: 12:31

University of Phoenix was really exploding with growth and they were looking for adjunct faculty to come in and help deliver their faculty practitioner model, and I was up in Alaska the girls were little at that point in time I was what they call a slope widow. My husband at that time was a slope worker up in the North Slope oil field, so I had a lot of time where I was a single parent, you know, and the girls are sleeping so I have something to do. At that time that came across. I thought, well, let me try that. That sounds like it might be interesting. I've been doing a little bit of something similar with Parent Soup, a subsidiary of iVillage with their asynchronous environment for families.

Speaker 3: 13:23

So I jumped into the teaching and started teaching graduate level accounting, because that's where they had a high need. And again, here's the English major teaching graduate level accounting. So it was a fun experience and so that's how I got into it. And then, shortly thereafter, I'm going to say University of Arizona, global, but at that point in time it was Ashford University, who was then bought by Bridgeport you know how acquisitions go and so I picked them up in 2010. And so between those two schools, I'm teaching either graduate or undergraduate finance and accounting coursework. I'm teaching either graduate or undergraduate finance and accounting coursework, a lot of business ethics these days, some business writing Again. Part of this whole experience is again coming back and storytelling. And how do you take, in this flat, asynchronous environment where you don't have a visual, with students, where you're making that online connection, you're building that bridge of community and you're teaching them or answering questions, helping them to understand some really dry and interesting topics?

Speaker 3: 14:35

You know I mean, debits and credits are only so exciting, so you know it's being able to bring forward the storytelling and do so in a manner that people can connect in that flat environment. So that's kind of the long story there.

Speaker 2: 14:51

Yeah, that's beautiful. Yeah, so it's. How do you is that the translation is how do you get people engaged to work in, maybe tasks that are monotonous or they have to do every day, or whatever, and keep them motivated and engaged? So you probably learned something there, right have to do every day or whatever and keep them motivated and engaged. So you probably learned something there, right how to do that. And as you look at your broader leadership brand, how would you define how you want to be known or are known as a leader, and kind of what principles of leadership do you stand on and say these are my go-to. If I'm caught back on my heels, if something's happening, if I have a moment I have to engage resiliency, what do you go to to stand on, to regroup and step in or generally lead in an organization that you're in?

Speaker 3: 15:35

You know, at the end of the day, it comes back to the people, right? It's all about the people. It's all about the people. And so, when I'm faced with a task, it's very easy to turn on the analytical side of my brain and go to the numbers and bury myself in the spreadsheet. But it's the people part, that connection.

Speaker 3: 16:05

You know, reading a lot of literature I still read a lot of literature You're learning about people, about things, about relationships, and it does come back to the people, right? Because, the spreadsheet aside, the numbers aside, you have to figure out how to meet the people where they are and how to work with the people, again, being the authentic person. And you know, as I was preparing for this discussion and thinking about some of these questions, you know, and trying to think how would I define my brand and, you know, I think I might come up with a statement kind of like, you know, a passion for creating an environment that fosters the human connection, that fosters the human connection, embraces technology, because you'll hear me talk about AI, which is just really exciting to me, and all the different iterations of it, technology in general, and how to inspire opportunities, not just for myself but for other people, because, again, together we rise right. So how do I create an environment that I thrive in and that others I can help others thrive in?

Speaker 3: 17:10

And so that's kind of how I would define my philosophy for leading, not just finance, but in general.

Speaker 2: 17:18

Yeah, and I think you know you touched on two things that I believe are the fundamental jobs of a leader is to create that environment and to facilitate conversations that forward what's most important. So you have to know how to create that environment right, but have conversations where you're present in the conversation, genuinely listening, coaching in addition to getting things to move forward and supporting that person to feel good about the job they're doing, or they give them tough feedback they may need from time to time in a way that they can absorb it, take it in and not make it take too personally all those kinds of things that we have to do as leaders. I think you also said that you really are committed to in our conversation, whatever you like committed to fostering a culture of transparency, integrity and accountability, which I think feeds into what you just said. So can you share a little bit more about how your approach ensures those values are unfolded around you and any specific strategies you have to ensure that transparency, integrity and accountability are fostered on a daily basis?

Speaker 3: 18:36

Yeah, you know, as we think about those characteristics, you know, I think there's some stories there that probably explain it best.

Speaker 3: 18:50

And you know we all heard where you know I've walked into many organizations where the budgets are a secret, right? Well, finance did the budget. You know it's finance's budget and it's like, no, it's not finance's budget. Finance is a tool to help you with your budget. You know we're we're just a means or a mechanism and it's really about what do you need to create a budget so that you can measure your own success and so to drive that accountability and move that, that, that onus, from the finance shoulders to to the operations operations, because we're trying to facilitate that front line right, give them all the tools and and help them understand again we are a resource. We're not a weapon to beat them down because they missed the budget. You know they have to own it right and so you know, when I think of things like that, you know there's a.

Speaker 3: 19:46

There was an experience I had at Crystal Creamery with involving and it's really kind of a silly story, but there was. I always have a whiteboard in my office wherever I'm at, and I always have just sometimes keywords on it, just things that that, as I pass, just keep in front of mind. One of the phrases was pig farmer. Why that was important was just in talking to people I'd heard about the pig farmer. I was trying to understand what is the pig farmer? What does the pig farmer do? We're dairy here and we sell milk and ice cream and cottage cheese. What is a pig farmer? Then I said, oh, we have a contract with this pig farmer and they pick up all the waste.

Speaker 3: 20:29

Well, and the sidebar I'm seeing on the, we're wrestling with product variances right and product loss and we're losing like a million dollars, you know, every six weeks. And it's like why are we losing it? We couldn't hone it down. We could tease out pieces of it, but we couldn't hone it down. And finally there was a gal outside my office, an AP clerk, and she would come into my office every now and then to chat and she would say Karen, what's pig farmer mean? And so I told her one day and she says, hey, I want to show you this. And she showed me an invoice from the pig farmer and it was just a blank piece of paper, had his name at the top, a dollar amount at the bottom and signed off by it by the person handling the account. And I said, okay. First off, I said what are we paying for? I said you got to get more information to pay this right. So she started hunting that down.

Speaker 3: 21:24

Long story short, by the time we went from that we discovered that we thought we were dumping about one to two vans of product a week. We were dumping more like one to two vans a day, and in some instances we actually, with photographs, were able to demonstrate that we had overproduced like a private label, so the customer wasn't going to buy it. We were literally driving that truck off the production line over to the dump station for the pigs. And so once we had the story pulled together and we saw all the pieces of it, starting with what this AP clerk had shared with me, through this transparency we were able then to to knock off a big portion of that product loss. But again it comes to being transparent and then starting to just be objective have conversations, be authentic, bring people into the path and then hold people accountable. So then we had a process in place and we started recording. And then once we were recording, we knew where we had other issues and so it's just one thing fit on the other. But again it all ties together there.

Speaker 2: 22:43

Yeah, but that investigation and that transparency led to all that. You know and I think you know, sometimes there's a resistance to transparency, like if people knew this information. Obviously you have to be cautious at certain times when you can't share, you might have to be doing layoffs, whatever it is. You have to be careful with certain things and legal issues and all that. But when you're trying to solve a problem, you know, I find sometimes people get in meetings and they're arguing with each other and they're actually arguing against two different. They actually have two different problems in their mind. They're not really against each other, they just have two different problems and they don't like the solution the other person provides, which is for another problem. You know, but what do you think makes? What have you seen in your experience about? How do you build that transparency? Is it just for you or through you modeling it? Is it through setting clear expectations? How is that transparency? How do you know where you can be transparent first of all, and then how do you foster that in an organization? Transparent?

Speaker 3: 23:48

first of all. And then, how do you, how do you foster that in an organization? Yeah, you know it's. It comes down to that, that kind of speed of trust that you start with little things, right, and and I'm going to call a budget a little thing, right, cause normally I would say a budget is a little thing and that those, those more things you can't be as transparent with, like layoffs and that kind of planning, occur at the higher level. I'm going to call it a corporate level, FP&A or above.

Speaker 3: 24:16

But but for those other things where you can be, you know, so, really assess what, what you're doing, and do you need to be that way? You know, at SSI we had an issue with inventory adjustments and when I walked in there, everyone kept saying well, it's a source of revenue, inventory adjustments are a source of revenue. And I'm like scratching my head, thinking, no, inventory adjustments are just basically periodic true ups and should always be correcting itself. Right, and really, that number is maybe a recording issue between periods, but it shouldn't be a consistent revenue generating thing, cause you're not growing your, your inventory organically, and so once we, you know, once we started peeling around that account, we had operations involved, it involved, and then people started talking about it.

Speaker 3: 25:11

We discovered it wasn't an account, matter of fact, it was how they were relieving another account, so that that other account wasn't as transparent about the heavy gains in it. And it's like, no, it shouldn't have those gains, because we should be recognizing that those gains as we go along, not saving them for when someone won't make their budget so that we have a little padding. It's like no, we don't do that kind of math, just keep it honest, keep it simple, keep it transparent.

Speaker 3: 25:43

So again, picking something little, building that trust in those areas and then it grows and then you end up with a very transparent organization. People are willing to talk things out because it feels safe, and then holding people to that standard.

Speaker 2: 25:59

Yeah, I think it's beautiful. Trust and safety are essential and you have to build that over time. Everybody has a different relationship in their consciousness with authority, right, and we don't know, we can't go into their minds, or they come into the organization and see where they're at with that. We can only, you know, watch that over time and see what they need to do to feel safe, and we have to. They have to see it. Of course they see it. Oh, wow, they. They just spoke their mind. It was direct. That's refreshing. You know you have to coach people around that and support them around that and building that trust up and that safety. That's really well said.

Speaker 2: 26:35

You also and I think you're speaking to this now, so I don't think you haven't spoken to say but is there anything else you want to say about, like you mentioned, that finance isn't just about the hard skills and numbers, but it also has a softer side on it, at an umbrella level. What would you say about that? I think that's true. I mean, ultimately, the numbers are meant to help decision-making, which can go towards that softer side. But what other things would you say about that, how it's a mix of both?

Speaker 3: 27:02

of those things, the soft skills in finance. You know there's been a lot written recently about how much time we're spending communicating. Right, I think there was a Forbes article that said we spend like 18 percent of our day communicating. In other situations I think it was Deloitte who had a, or HBR that had a study that it was like 88% that we spend communicating. So when I think of it, it's not just the numbers but it's the ability to tell that story, to understand that story, to convey that story, to piece out what of the story makes sense or doesn't make sense and bring it all together. And that's where finance is able to make that contribution, because we're trying to not just report numbers and report KPIs but understand the context for them and then how we can shape that data and apply those concepts.

Speaker 2: 28:05

Yeah, because I think if you're looking at increasing funding, a lot of times the story they want to know that their story is grounded. But it's a story that sells right. It's a story that attracts that like the excitement of what's possible here. And oh, by the way, we've done our due diligence and this is solid in this, this and this way. So the story is supported by the numbers, but the story is what sells right, it's the thing that gets the street, the investors excited, et cetera. Yeah, definitely, yeah.

Speaker 2: 28:35

Well, you've talked about this whole area of taking care of people and I really like that. I want to kind of extrapolate on that more and I'm wondering, you know, because I look at there is a wide range. Like any field, whether the cio, ceo, uh, cmo, cl, whatever, or a cfo, there's a wide range of how they tend to. That is, if I still think, for many cfos I don't know what the percentage would be it's still an afterthought or a given lip service. What is it that you see in your own profession that still needs to grow and expand? That would help every CFO be more successful in this area. I know it's kind of building off something said. It's not a question I gave you. But I'm just curious if you have any thoughts on that. What is the profession or the people at that level still have to learn and appreciate that. They may not be appreciating about that. That would help it be easier for them to begin to adopt that and become more masterful that side of their job.

Speaker 3: 29:46

Yeah, you know, one of the things that I have found particularly helpful and inspiring is is having a leadership coach. Um and it. It might not be one, it might be changing over time, but I think that having that coach that, as you are facing situations, that safe spot you can go, where you can try on different paradigms and just talk through. It's like the rearview mirror approach, where you're sitting in your car and you're talking out different scenarios, but sometimes that executive coach has insights that really help you. They have that business expertise, that organizational management expertise. They've probably talked to other C-suite people, so they have a concept, they're in your mind, they can get there easily and they can guide you. And to think that you can do it all on your own or by reading a book or listening to a lecture, no, you really sometimes have to have that discussion and that's where I think that value of that executive coach is helpful.

Speaker 3: 31:09

You know, in my situation, one of the benefits of coming to the C-suite is oftentimes that CHRO or that VP of HR.

Speaker 3: 31:22

They fill that function of an executive coach internally and that's a safe space where you can have that collaborative discussion because you're all working together and they're able to kind of tease things out and help you. But the external one also is able to bring in other insights and say you know, I heard someone talking about this at this other company that soft skills you have to really think about how you're going to develop it, and that executive coach or that professional coach, there's value in that and I don't think people embrace that enough. I wish now I had been talking to people in an executive coach type relationship, you know, 10 years ago as opposed to within the past two years. But I think that that is a an important part of our toolkit that helps us with that soft skill. Because you know, as finance people, accounting people, it's very easy to hide behind a spreadsheet, hide behind a desk, hide behind a closed door. You know, heck, as an English lit major, I like to hide in the library behind a book.

Speaker 3: 32:33

You know, but we have to get out and we have to interact with people and so just having that little executive coach sitting on the shoulder, that little inner helping with that inner voice, is very helpful. That little inner helping with that inner voice, is very helpful, does that?

Speaker 2: 32:48

answer your question. What have you learned from your coach that like that, that about yourself, that is not in your way anymore? Maybe some things that got out of your way, that you recognize that, that, that the insights came from that relationship and those interactions, anything you would be willing to share?

Speaker 3: 33:05

You know, one of the things that we're working on right now. For me, my challenge is I've always saw the CFO suite as the pinnacle of my career, and now what we're shifting the focus on is why does it have to be the pinnacle of my career? Maybe I have the skill set to be a CEO, you know, and if I am, what does that look like? And you know, what do I bring? And I was just talking to someone yesterday and they had brought in a third person and you know he said you know, look, you're learning this Portuguese language so that you can take this test on proficiency and you're really fascinated with this culture.

Speaker 3: 33:54

What if you took your skill set and you went over to the European market and became a CEO for a CPG startup or type company in Portugal and it was like, oh my God, that would be like the perfect world. Right, it would be just a perfect experience. It kind of, you know, sure, why not? Let's try something like that. I think it would be exciting. But in my head, you know again, there's still I think I'm here at this journey, but you know, maybe the journey is still further up and so that coach is able to help say you have this skill, all this toolbox, why stop here?

Speaker 3: 34:37

You know there's a lot of CEOs who don't have that level, and if you look at statistically, you're seeing more of it that a lot of these C-suite, the CEO roles increasingly are being filled by the CFO, because we are often there as the advisor to the CEO. We have that number of expertise. We're seeing now the whole business, as opposed to being more the transactional controller type. So we have it, it's just now. How do we tap it, how do we recognize it, tap it and build it, and so that's the value that my coach has been bringing with me.

Speaker 2: 35:12

Yeah, I mean, one of my clients just came into an organization. I work with her as CFO. She's now become the CEO of the organization and part of that came from the CEO saying there's something you have to develop in yourself. I already see you as that potential. So he had an eye on her right away. She had a natural instinct for things, but there was something that was in her way and I'm not saying it was because of me, but she moved through that and to the point where he said okay, you've now gotten over that, let's get you up, because I want to get the heck out of here. I want to be on the board. I got other things to do in my life, so it's like it can happen.

Speaker 2: 35:54

I think you're absolutely right that if you have the side of the, if you understand the revenue side of the business and you understand the people side of the business and you understand the finance side of the business and you know and you understand the markets and what they need, what else do you need to be CEO? I mean, there's other things to round out, but those are the big pieces. And yeah, and it's also there's something that happens to me when I work with clients that when I spark that greater possibility, something happens in the way they do their role. Now there's something that relaxes in them, that expands. They're not as hyper-focused in certain ways and when they relax, more of that authenticity comes through more right, and that frees them to be themselves, frees other people to be themselves around them more.

Speaker 2: 36:40

So it's really well said, really well said, and I know that you've had a lot of impact on people. So I want to just turn another direction here. I know you've had a lot of impact on people, so I want to just turn another direction here. I know you've had a lot of impact on those that have reported to you over the years and people. This has been an evolving thing, but people are so important to you. Do you have any examples of that impact that you look back on and say well, I really feel honored that I was able to affect that person's life, or those individuals' lives, in a way that forwarded their careers and allowed them to grow?

Speaker 3: 37:13

Oh yeah, you know.

Speaker 2: 37:15

I'm sure you have multiple examples.

Speaker 3: 37:17

Yeah, no, again, this is a story. At Crystal Creamery I was having the hardest time finding people for my FP&A department and people, you know I could hire analysts, but they all had a vision of what they wanted to do and it wasn't necessarily aligned with the needs of the business or with my vision. You know. And you know, let's face it, it is a bit of a dictatorship in corporations, you know, so that you know we can make it as soft as we want, but again, you can't be, you know, down on the front line making your own direction. Right, you do have to get with the team, follow the team team spirit, and but I was having a hard time. I tried, you know, at a financial analyst level. I tried at senior level, I tried at the manager. I just couldn't find people. I found a lot who wanted to quiet, quit, a lot who had their own vision, a lot who had a different perception of their skills than they actually did. And having come from FP&A, I have an idea of what's involved in that. So I was just kind of beside myself and the VPHR, walter, and I sat down one day and I said Walter, I said you know, I bet I could go to Stanislaus State down the road. Here I can get three or four kids right out of graduation, the graduation line and train them up in a year, have them fully functional and perfect employees. And he says, well, it's probably cheaper to do that than what we're doing. So that's what I did and so I went out and hired four people and yeah, it was a big investment up front but all of them just really took off. And you know, after about I always say first year to learn your job, second year to master your job, third year to take it to that next level and be ready for that promotion or that next level. My pricing person went on to a career at Gallo Wines with a promotion, and Gallo, you know, is a big company and it's very difficult to get into. Another one went into, again a promotion into, and he's having a great career at Syncient, which is another national company. A third I actually brought with me over to SSI and I just turned him loose into all the operations in the cost side and he's been so instrumental in helping us with our work around CCNA. And then the fourth person he has gone on to a very nice career with the local irrigation district, the people who do our water. So you know whether you want to go national or local, but all of them promoted out and all of them are just on the right trajectory. We stay in touch. I give them career guidance every now and then, but they all have seemed to figure it out. You know my pricing person.

Speaker 3: 40:24

She actually not just to Gallo, but then she also got her MBA and then that opened it for us. And this girl you know she was a first generation American. No one in her family had gone to college before her. The idea of of of getting the college degree was a big one, of getting the MBA from UC Davis or their MBA program was a big deal. And she did all of this while having two little ones at home. So it's just the drive and being able to help her capture that and project it. This gal in particular. She'll be a CEO in no time. I'm confident that she has that ability. She's just pulling it all together quickly.

Speaker 2: 41:11

Yeah, when you think about all those people that you've touched. What does that do inside you? How does that affect you when you think about that?

Speaker 3: 41:20

Proud mom moments. You know I look at my people and you know I don't want to say parentally, but there is a certain amount of parental pride as an extension of my family, because they're part of my circle, they're part of my family, my work family and that brings me great pride. And that's not to take away from my own daughters. I have one daughter who she chose not to go to college but she has slowly been carving her horse out as a USEF United States Equestrian Federation professional trainer and she's teaching these little kids to get on these great big horses and go over fences. And she's been building this business on her own, with no help from me, and she's doing a great job. I'm just amazed at this, that entrepreneurship, because I'm more an entrepreneur Within the organization. I have a lot of entrepreneurial experience. She's just doing it all entrepreneurially. So that's very exciting.

Speaker 2: 42:30

So I look at all of these and I just proud mom moments.

Speaker 2: 42:34

Yeah, it's amazing when you spark something in people and they find that essence, that is drawn to something and that's encouraged to follow it. Then it just grows. It goes back to the comments you said about saying yes to life, saying yes to these opportunities, going back to the GMAT and going through the calculus and algebra and then moving that forward and just keep on. Okay, this makes sense, let's do this, and when we do that it tends to flower, and we do that for others. It's just so fulfilling, as you said.

Speaker 2: 43:06

I want to shift the conversation a couple other areas because you have so much to offer and to share here. You know, in your current role as CFO, you indicated you have implemented finance FP&A to bring forward transparency and innovation to the finance leadership positions. And how do you approach driving innovation with contained resources? Because that's, you know, sometimes we can get on, you know, innovation steroids. Then other times we would like to innovate more, but we may be constrained in what we can get on innovation steroids than other times we would like to innovate more but we may be constrained in what we can do. Can you share a story or two or just share your philosophy around how innovation gets forward in an organization like yours?

Speaker 3: 43:47

Yeah, it comes down to good project management skills, right, and when you think about project management whether it's writing a paper or planning a career or working in an environment, you know some of the first things you have to do is identify your constraints. You're going to understand, you know kind of where you are today and where you need to go and where there might be some pipeline disruption and so that you can prioritize your projects around that. And if you're in a constrained environment, you not only want to be able to prioritize, but you're going to want to look for those high impact projects. You know the ones that they're the low hanging fruit. Knock those off as fast as possible, because that's's going to build you your street creds Right.

Speaker 3: 44:36

And then you want to get into leveraging technology wherever you can. And you know, a lot of times there's a conflict or friction between IT and accounting and finance. And you know, for me, I love technology. So you know, I recommend, know your IT people, because when I came into SSI, you know I had these ideas and I discovered that our IT VP he actually had a lot of these already kind of queued up. He was just waiting for someone to say, hey, let's just turn it on full bore, you know.

Speaker 3: 45:13

And once we started doing that, it's like it just went from a few low hanging fruit to a lot of low hanging fruit and then it's chipping away at the rock, right, and then pretty soon there is no big rock to do. So leveraging technology with those projects. And and then finally, fostering the culture of innovation right, so you want everyone to feel empowered to talk, feel to communicate, right, so be transparent, you know, and be innovative, and then you get that continuous improvement. And so I think, as I look at my strategies for that area, those are probably four key strategies that I've used. And again, outcomes easily, it improves your decision making and you get cost benefits out of it. So, yeah, well said, thank you.

Speaker 2: 46:10

Yeah, and related to technology. Ai has changed in the playing field in all fields, but few have been affected as much as the finance function right and you're an early adopter of this technology. You're very excited about it, as you mentioned earlier in the show. Where do you see it influencing the future of financial management and operations AI and can you share any specific examples that you can where you've integrated AI very successfully in your strategies?

Speaker 3: 46:41

Okay. So if we think about it, you know, chatgpt really was like a year ago, a year and a half ago, when it just kind of started blossoming right.

Speaker 2: 46:51

Yeah.

Speaker 3: 46:51

Yeah, it started becoming a household word and again it was kind of started blossoming, right. Yeah, yeah, it started becoming a household word and again it was kind of the IT folks right, it was their best kept secret. Some of the things that I've done and I have I will never say I'm an expert on it, but I really, if there's a new or a video out there on LinkedIn Learning that I haven't seen, I really try to hit all of them because every day it changes and it's morphing. It's not just regular, there's no just like generic AI anymore, there's generative and some of the other ones.

Speaker 3: 47:25

So how I had early adopted it was we changed accounting firms and in doing so we needed to provide them with all the SOPs, and in doing that I had made the assumption that of course, we've had an accounting firm, we have all of our SOPs written, and I discovered very quickly we didn't have SOPs written and none that were reflective of the current business environment. So I had to write a lot of SOPs very quickly. So I divvied it up to the team and then I was thinking, okay, this is going to be really hard and this is going to be really cumbersome, because it takes a while to develop an accounting SOP. I discovered that if I craft my question right into ChatGPT and this is three before they had four to add on that it would generate a standard template for me, and then all I had to do was customize it. Well, I ended up knocking. We knocked off more than a dozen SOPs within less than two weeks.

Speaker 2: 48:36

And this was customization and all. So it was just an overwhelming feeling. How long would that have taken before AI?

Speaker 3: 48:45

Oh, you've written SOPs too. I'm sure I'm going to say we did that in less than two weeks and that normally would have been probably a three-month project, right? Yeah, exactly the research. And you know, do you have all the controls? And here you're able remember AI in the background, it's able to go out and reach into all of those resources that normally, if you're writing it, you're going to have to go look up. You know, go out to the AICPA page. You know, do some research on the ICMA page. You know, look at GASB. You know, just go out to all these different sites, do a lot of research. You know what can we do, how's the policy changed, and things like ChatGPT or OpenAI. You can do it in like seconds, right, and that's where you get that savings.

Speaker 3: 49:37

And then, as I look forward to it, you know we started using OCR technology for invoices. So all the invoices that come in, they get screened um and it populates this OCR so it can go feed into our system and get processed Um. Right now we're doing that, but we still have a lot of people who go through that because they don't trust the system or they want to be able to manually go in and do some changes and there's still a lot of touching, and I'm thinking what they're doing is tends to be repetitive. If it's a craft invoice, it's always the same thing calculations are doing is craft AI. That's the beauty of AI is because you can turn it loose and train it and so it replicates that. So I could see where that AP function, where I might have, you know, seven or eight people. Now you know, once it's fully implemented, I only might need one or two people.

Speaker 3: 50:36

The exceptions I could see where your general ledger account let's start up the food chain right, your general ledger account. They're doing your general journal entries. Well, how much of those journal entries are just the same journal entry every period. Right, you're taking the data and you're reformatting it for the journal entry to move that data into this other system. Well, that's what AI can be trained to do. Right, you'll have fewer errors, maybe more timely All of a sudden. Now you can start to shrink your closed process, you're able to reduce some of your errors and then you really don't necessarily need a GL accountant or an army of GL accountants, but maybe you just need someone more at that accounting manager level. To look at the exceptions right, to deal with that higher skillset. Same thing with financial planning and analysis.

Speaker 3: 51:31

And I look at the tools that are out there, whether it's something like a rock hopper which sits on your Excel and you put in your natural language and it goes out to your data lake and pulls the data.

Speaker 3: 51:54

You know data rails is another one.

Speaker 3: 51:55

You know they're able to use this AI to go out there and they have different functions and different needs, but they're all beating on it. Of course, with AI and its ability to dig down into the organization and grab that data faster and move faster. That speed there it does put the shift, the challenge now back to it, not to doing the business analysis so much that can really shift back to the fpna but to making sure that that data lake isn't polluted, because we we all know, working with data, there's a lot of normalization, a lot of data cleansing, a lot of garbage. You know we might have one system that that at at invoices with one date and the other one at another date and um, you know it's just one might segment to. You know two decimal places, one might go out to six decimal places and you just got to cleanse the data, um and and have a system where you're just focused on the exceptions, and AI, I think, will just accelerate all of that and I think that'll be really exciting as we move forward.

Speaker 2: 52:57

Yeah, it is very exciting and it's kind of like having almost another employee. You've got to train it. It does have this amazing ability and I don't use it at the level of complication you do, you know it's just like number one you have to still be in control of the content and the driving of what it's pulling for you, but over time it's amazing how it does learn about you and your system and your organization and is able to then surprise you over time Like wow, this is getting really good, it's really exciting. The other area that you've had a lot of involvement in is mergers and acquisitions. Right, you've had, your resume is full of it and you know this is still an area of how do we actually create a successful merger.

Speaker 2: 53:44

You know, and I find that it's always a bumpy ride at the beginning of a merger it's going to be because it's like bringing a bunch of people together that were doing things a certain way with another group of people that are doing things a certain way and there is a natural resistance to changing habits so that we can create new habits in our new organization to move it forward in a way that we want to leverage what this merger was supposed to do for us. What do you think are the most critical factors to consider when a company goes through like a high stakes M&A transition? What are the things they have to really be paying attention to most in your mind to make sure it's successful?

Speaker 3: 54:20

You know it comes back to transparency, authenticity and integrity, right, because it is stressful, right. So how do we take the noise out of that experience? And again, it's not transparency necessarily throughout the vertical, but at that horizontal team that you're working with and building that trust? Because if you have a team member in that, that is going to you know, maybe they want to make a name for themselves on this topic or they're doing something that's going to be just kind of self-centered and divisive. It's going to be like a rot, it's going to grow and it's just going to be too difficult, right. And part of one of the things I've learned in my career is I can be fast to hire, which I am, but also be fast to fire, right, because you're not doing anyone a service by hanging on to them, right?

Speaker 3: 55:18

If it's just, it's like a relationship, if it's not meant to be, it's not meant to be and move on and maybe you come back at a different time, right? And I've had people that haven't worked out for me in one place and yet they worked out for me in another, and I'm perfectly fine with that. But it is going to come out to the speed of trust and we just keep in mind culture trumps strategy. So, no matter what how good your strategy is, if you can't make that culture work, yeah, your strategy isn't going to function and what's what?

Speaker 2: 55:50

because I think it's a culture. Integration is an area where in which maybe people don't invest as much in why they may fail or may take them longer to succeed. What's the finance functions job in that cultural integration? If you would say that they had a job or a particular focus in ensuring that the cultures came together, what do you see as the value that finance provides in that process of integrating the two cultures?

Speaker 3: 56:22

Again, it's getting out of the office and talking to people and understanding their processes right and and understand everyone has a role in an m&a, of understanding the other side of, of bridging that communication. I mean we can look at great failures right over time. We had damler you know ben's and chrysler right, one was very processed and structured in our way at the highway and you had chrysler, which was very kind of a innovative approach to business. One was profitable. That's why the other was being bought out With Quaker and Snapple again two very different companies. I can look at Pepsi and Sobe. I think actually it was a very successful merger, two very different cultures, but that worked out.

Speaker 3: 57:08

Finance's role, again, it's not just doing due diligence on the numbers, it's doing due diligence on the culture, so kind of like the pig the pig story, it's not just understanding the numbers but kind of all the stories and perceptions around that so that you can bring it all together. That that that was key there. You know, making sure that there's some budget allocation for the integration. That it's not all, just all work. When I think about that, you know it's not pizza parties. I think we can't eat any more pizza, but we can talk about some team building activities where people have an opportunity to communicate in a more relaxed environment and build those bridges.

Speaker 3: 57:58

And then leadership involvement. You can't just expect the frontline to your accountants to do all the bridging. The CFO has to be involved in that. They have to be visible, transparent and when you do all those things you end up with a little bit higher morale, improved collaboration, smoother transition. So again, the tone is set from the top. The work is really done from the bottom and again it's about bridging communication and finance can play a big role in that.

Speaker 2: 58:30

Yeah, it's beautifully said. Finance can play a big role in that. Yeah, it's beautifully said. Yeah, I mean it gets back to like that, transparency, developing those trust bridges, communicating, being open to hearing concerns, addressing those concerns and whatever we have to as people see that happening. You know, telling the story about the new company, making sure people are excited about that, all those kinds of things, yeah, and then finance has a big role to play in all that.

Speaker 2: 58:52

Well, as we wrap up today, you know, one question I, like you know this is a big question is you know, what is the future of financial leadership If you see it different than it is today? What's the call to action that you would give to other executives maybe people that are directors of finance or VPs of finance aspiring or starting their careers in finance, as well as CFOs I mean, that's a wide range of people may need different things, but you know, what would you say to those people that are growing in this role of finance? That they need to be keeping an eye on the horizon for, and developing in their skill set to be successful.

Speaker 3: 59:30

You know the digital transformation that's going on right now. Be receptive to it, be open to it. You know, I'm not going to say be on the bleeding edge, but be partner up with your IT leadership team to see how they can help you solve a lot of your problems. And then be the champion on that right, because we can sit here and say we don't like that technology and we've seen a lot of ERPs fail because, you know, someone decided they didn't like it. It's not.

Speaker 3: 1:00:07

When I came into SSI, I had someone who said, you know, they just were not going to do this file bound. And I sat him down and I said, look, it's not your decision, it's my decision, we are going to do it. And so how do we get? How do we move past this? What can I do to help you with this? Because it's not an option. You're going to go kicking and screaming or you're going to go, you know nicely, but we're going to make it happen. You know, and I just had to take a firm stand with that and it's, but it has to happen. It is going to happen. And so, as as leaders, we just sometimes can't abdicate that responsibility. We've got to own it and make it happen. Got to own it and make it happen.

Speaker 3: 1:00:58

You know, having an agile and flexible workforce model. You know I hear some. You know the return to office mandate. It's like that's a great way if you want to like downsize your workforce, but that the new, the new generation is this that's coming up. That's not where we meet them right. They're wanting more flexible. They've seen mom and dad spend, you know, 80 hours a week at the office and miss softball games. They don't want that, right. They want a little more balance. And so you know how do you make that happen? And you know, just be open-minded to that and meet the people where they are. And I think if you're meeting the people where they are, you're going to have a more productive workforce, a more connected and in an odd way you know we talked about asynchronous learning and creating that connection and that belonging and that inclusion. You know that's that's going to be important.

Speaker 3: 1:01:51

You know, again you know we can talk about I know it's a polarizing topic is DIE, but I think that's important for us in the workplace. And then you know again, using technology for data-driven decision-making. I think we need to be very open and invest in that infrastructure, invest in that technology, because that is going to have the long-term payoff for us.

Speaker 2: 1:02:18

Well, thank you so much, Karen, for everything you shared today, the insights you've given us on financial leadership and transformation and, you know, getting to ready people. So much was shared today that I know that executives are going to. So much was shared today that I know that executives are going to resonate with. It's going to add value in their day. The train is just reinforcing that right now and I'm sure our listeners gained a lot from the story. So really, thank you very much.

Speaker 3: 1:02:46

Appreciate you being here on the show today?

Speaker 2: 1:02:48

Oh you're welcome and to all those that are tuning in, I want to thank you for being part of this journey with us. Your time and attention mean the world to me. If you found today's discussion valuable, please spread the world by letting your colleagues, friends and anyone who could benefit from this conversation know about Unfazed Under Fire. Remember, you can catch all our episodes in video format on YouTube and audio on Apple Podcasts, spotify, amazon Music and over 12 other podcasting platforms. If you're watching on YouTube, you can click the links below. It'll take you to all our shows that we've ever produced. If you're interested in and this is your first program and you're interested in listening to others, and until next time, I want to keep leading with purpose, making an impact as a leader, have a great rest of your day and we'll see you next time. This is David Craig-Otts, leadership Alchemist, signing off for today.