Finance Monthly CFO Awards 2018 Winners Edition

www.finance-monthly.com 50 USA Finance Monthly CFO Awards 2018 Finance Monthly CFO Awards 2018 three basic questions that we asked. The first two were easier than we thought as CB&I had a lot of the same issues we had addressed a few years back at McDermott, while the last one was a bit more challenging because we had to convince a number of financial institutions of the first two. What was the strategy for the company leading up to the combination? When our CEO, the Executive and Strategy Committees and Board of Directors looked at our bigger strategy, we focused on three things. We wanted more of a technology base for long-term sustainability. We wanted to diversify our revenue stream because we were so focused on off-shore and subsea capital expenditure (CapEx) projects. And lastly, we were the smallest in our peer group and we needed some scale so that we could get efficiency on the fixed costs of the company. When we looked at diversification, we always wanted to stay as close as we could to our core competency. Our core competency was hydrocarbons construction. When we looked at where the combination would take us, it would take us more into engineering, but it would also take us into onshore construction in the hydrocarbon space. That was where CB&I was a perfect fit because they had the same customer base, just a bit further down the value chain—downstream versus upstream—with similar contracting models, skill sets and competencies as the offshore space. Also, the petrochemical and refining investments are countercyclical to the offshore CapEx, so you get a bit more balance in your portfolio. What are your goals as CFO post-combination? Integration is ongoing across the company and two large parts of that integration are within my responsibility: Cost synergies and Information Technology (IT). We also have the cultural integration which we sponsor as a part of the Executive Committee and we are updating our work procedures and processes to integrate them into one. The key aspect of how we work and generate value is the approach of One McDermott Way. It is all about adopting one process, worldwide, to assure quality, consistency and repeatability. Turning back to one area that I am responsible for is the business systems side within IT, where we have just completed an enterprise blueprint and will now go on a journey to the Oracle ERP cloud. We also focus on the entire eco-system of applications since we know everything needs to come together to have a successful integration. Lastly, we have our Combination Profitability Initiative, which not only focuses on synergies, but it also focuses on creating a new cost culture for the company. The CEO, Executive Committee and the Board of Directors are relying on theMcDermott playbook to stabilize, optimize and transform our new company. We are implementing all the lessons learned from our previous cost initiatives into the combination profitability initiative—we can make less mistakes, we can be more organized and achieve a greater result earlier. What does the award mean to you? The best thing that I get from the award is that it is a recognition for everyone who works in Finance and IT. We have been on this worldwide journey as a team for four years. This award is more about recognizing all of those individuals than it is about me as an individual. We have achieved so much as one team. Why is it important to be more transparent? Prior to the combination, we had gone from the last company in our peer group to publicize our earnings to Wall Street to being first. We had also gone from being one of the least transparent companies to the most transparent. Internally, we have gone from providing our leadership team with a skinny book of three pages at the end of each month and only closing the results on a quarterly basis to now giving a full suite of leading and lagging indicators and Key Performance Indicators on a monthly basis. One of the main goals of the executive team at McDermott when I joined was to build investor confidence in our company and in order to do that, we had to understand what drove the company and then we had to tell our story. Being more transparent builds confidence with Wall Street, which then leads to more investor interest, understanding and a higher stock price that improves shareholder returns. Being first to market allows you to do a couple of things: 1) you can control the message that impacts your stock—as opposed to your peer group putting out those messages; 2) it allows you to set the tone of your message, rather than having to react to the tone of other people’s messages. And overall, I believe it is motivating and rewarding for everyone to be seen as the leader. What is your advice if you want to be a successful CFO? As part of being a leader in Finance, you have to recognize you are a customer support department and you need to work with your customers to understand their needs. You must understand how to create a vision for your function that meets those needs as well as to continue driving your function forward. Once you set your vision, you need to communicate it, articulate it, and execute it. It’s a journey that can take three or four years, so it is a long-term commitment. One of the most important elements of the vision is to surround yourself with the best people. Give them the room to own the vision, manage themselves, and lead the function to great accomplishments.