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Financial Executives International

Committee on Finance and Information Technology

Committee Meeting

Japs-Olson Company

Minneapolis, MN  55426

September 16 and 17, 2010

 

MINUTES

ATTENDEES

 

Members
Michael Cangemi	Cangemi Company LLC
Greg Grocholski	The Dow Chemical Company
Stephen Hosley	The Hackett Group
Garry Lowenthal	Salt Creative
William Overell	Overell Solutions
Gary Petrangelo	Japs-Olson Company
Leslie Porter	University of Southern California
Mahesh Shetty	Encore Enterprises
Robert Shultz	Hewlett Packard
Carol Zoellner	Hallmark Cards Inc.
Guests
George Boyadjis	Cresa Partners
Technical Advisors
John Van Decker	Gartner
Mike Willis	PricewaterhouseCoopers
Guest Presenters
Fidel Baca	Exponent HR
Peter Flagella	Arcplan, Inc.
Melissa Krasnow	Dorsey & Whitney
Babak Nassirian	Arcplan, Inc.
Kathleen Rohrecker	Arcplan, Inc.
Lee Williams	Digital Connections
FEI Staff
Marie Hollein
William Sinnett
Maria Zadravac

 

I.          Welcome

Gary Petrangelo, Chief Financial Officer of Japs-Olson Company and host for this meeting, welcomed the committee members to Minneapolis.  He welcomed George Boyadjis, Executive Director of Cresa Partners and national vice chair of Financial Executives International (FEI).  Gary said that George had been very helpful in planning the arrangements for this meeting.

 

Gary also welcomed two guest presenters, Fidel Baca, Principal of Exponent HR, and Lee Williams, CEO of Digital Connections.

 

II.         Call to Order

Chairman Bob Shultz called the meeting to order at 8:30 a.m. CT on Thursday, September 16, 2010.  Bob thanked Gary Petrangelo and Japs-Olson for hosting the meeting.  He welcomed the CFIT members and guests present.

 

III.        Committee Business – December CFIT Meeting Minutes

Bob Shultz asked for comments on the minutes from the June 2010 CFIT meeting.  There were no suggested changes. Upon a motion duly made and seconded, the CFIT Committee accepted the minutes of the June 17, 2010, CFIT meeting.

 

Bob reviewed the schedule for future CFIT meetings:

 

December 9 and 10, 2010

Carol Zoellner of Hallmark Cards will host the December meeting in Kansas City, Missouri.

 

March 24 and 25, 2011

Carlos Passi of IBM will host the March 2011 meeting at IBM facilities in Costa Rica.  Maria Zadravac asked for members’ room requirements so that she can finalize a contract with the hotel.

 

June 2011

Greg Grocholski of Dow Chemical has offered to host the June 2011 meeting in Midland, Michigan.  Meeting dates are to be determined, but Michael Cangemi recommended that the meeting be held early in the month.

 

September 2011

Bill Burns has offered to host the September 2011 meeting at Gartner’s headquarters in Stamford, Connecticut.  Maria Zadravac will poll the CFIT Executive Committee for a possible meeting date, and coordinate the meeting date with Bill Burns of Gartner.

 

December 2011

Les Porter has offered to host the December 2011 meeting at the University of Southern California in Los Angeles, California.

 

IV.        Small and Medium Business Subcommittee Report

Bob Shultz asked Mahesh Shetty to present the report of the CFIT Small and Medium Business (SMB) Subcommittee, which Mahesh chairs.

 

Mahesh said that this CFIT meeting was focused on “Technology for SMBs” because of the overall profile of the FEI membership.  Mahesh thanked Gary Petrangelo for developing the agenda for the meeting.

 

Mahesh reviewed some of the SMB subcommittee’s current initiatives:

·        Software as a Service (SaaS);

·        Voice over Internet Protocol (VoIP); and

·        Financial Reporting for SMBs, led by Carol Zoellner.

 

ACTION: Bill Sinnett will work with the SMB subcommittee on their current initiatives.

 

V.         Emerging Technologies Subcommittee Report

Bob Shultz asked Bill Overell to present the report of the CFIT Emerging Technologies Subcommittee, which Bill chairs.

 

Referring to his latest spreadsheet, Bill Overell said that his matrix compares current CFIT subcommittee activities with FEI’s strategic goals.  It also lists the various means of presentation for each project and initiative, which describes how each project will be disseminated, including:

·        Committee

·        Paper

·        Article

·        Summit

·        Webcast

·        FERF

·        Other

 

Bill said that the matrix then lists the “Top Areas of Technology Focus” from other organizations that do not appear in the current list of CFIT initiatives.

 

ACTION: CFIT Subcommittee Chairs should continue to forward information about the topics that they are working on to Bill Overell.

 

ACTION: CFIT Subcommittee Chairs should look for ways to include “Top Areas of Technology Focus” from other organizations that do not appear in the current list of CFIT initiatives.

 

VI.        Technology and Reporting Subcommittee Report

In the absence of Taylor Hawes, Bob Shultz asked Carol Zoellner to present the report of the CFIT Technology and Reporting Subcommittee.

 

Carol said that Carlos Passi had prepared a Power Point presentation on “De-Mystifying the Cloud,” which she used in a presentation to members of FEI’s Kansas City chapter.  Carol explained that the members of the Kansas City chapter are not very interested in the Cloud at this time, because Kansas City companies are small, and their owners are mainly concerned about cash management.  However, Carol added that the Kansas City chapter members did request Carlos’ presentation.  She suggested that FEI send the deck to other FEI chapters.

 

Mike Willis said that he is drafting an Issue Alert on United Kingdom tax reporting requirements, which will require the use of XBRL.

 

Bill Sinnett said that Microsoft has sponsored a research project on “The Last Mile of Financial Reporting.”  Bill said that he has interviewed executives at Clarity, Microsoft, Trintech and WebFilings, among others, for the project.

 

VII.       Business Technology Optimization Subcommittee Report

In the absence of Art Alderson, Bill Sinnett presented the report of the CFIT Business Technology Optimization (BTO) Subcommittee, which Art chairs.

 

Bill said that the BTO Subcommittee has three main initiatives in Fiscal Year 2011:

·        Annie Flatz of Intel is working on Change Management;

·        Carlos Passi of IBM is investigating the Cloud, including:

o   Infrastructure

o   Applications

o   Services

o   Investment Optimization

·        Steve Hosley will look into Enterprise Performance Management.

 

Steve Hosley said that, in the past, Hyperion software was used to monitor Enterprise Performance Management.  He said that today, The Hackett Group has developed metrics that provide visibility for forecasting

 

VIII.      Governance, Risk and Compliance Subcommittee

In the absence of Margaret (Peggy) Boissoneau, Michael Cangemi presented the report of the CFIT Governance, Risk and Compliance (GRC) Subcommittee, which Peggy chairs.

 

Michael said that he had participated in two Webcasts since the June CFIT meeting at Intel:

·        “IT for Finance Executives,” sponsored by The Knowledge Congress on July 13, with other members of CFIT; and

·        “Continuous Monitoring,” sponsored by Infogix on September 1.

 

Michael said that he had written an article for the April issue of EDPACS (The EDP Audit, Control and Security newletter) titled “Internal Audit’s Role in Continuous Monitoring.”

 

Bill Sinnett said that Michael was working with him on a FERF research project on Continuous Monitoring, sponsored by Infogix.

 

IX.        Technology Issues Survey

John Van Decker of Gartner said that Gartner was satisfied with the 482 responses to the 2010 Technology Issues for Financial Executives survey, which was a good increase from the 267 responses to the 2009 survey.

 

John said that he modified some of the questions in the draft 2011 survey so that it would be more closely aligned with Gartner’s CIO survey, so that he could compare CFO and CIO responses to similar questions.  He said that he also would like to reduce the number of questions in the survey, hoping that would help increase the number of responses.

 

Bill Overell said that the survey would be launched in October, rather than January, which should help the survey response rate, and that it would be promoted through LinkedIn, which also should increase the response rate.

 

John then reviewed the individual questions of the draft 2011 Technology Issues for Financial Executives survey with the committee to get their input on which should be included and which should be deleted.

 

ACTION: FERF staff will work with Gartner to launch the 2011 Technology Issues survey in October 2010.

 

X.         Software as a Service in the Real World

Bob Shultz welcomed Fidel Baca, Principal at ExponentHR.

 

Fidel defined Software as a Service (SaaS) as shared applications that can be accessed via the Web, anywhere and anytime, paying as you go.  He said that the Cloud is the infrastructure, and SaaS is the application.  He added that SaaS is just a type of Service Bureau or a form of Outsourcing.

 

Fidel described some of the advantages of SaaS:

·        There are no upfront, license, maintenance or upgrade costs.

·        Costs shrink and grow with the business need.

·        SaaS provides distributed access to anyone, anytime, from anywhere.

·        SaaS works for Small and Medium Business (SMBs) as well as Large Enterprise Organizations.

 

XI.        Business Ramifications of Various IT Infrastructure Models

Bob Shultz welcomed Lee Williams, CEO of Digital Connections, Inc.  Digital Connections had signed an agreement to sponsor the IT Track at FEI’s Summit, April 4 and 5, 2010.

 

Instead of discussing the presentation that he planned for the Summit IT Track, Lee began his presentation by reviewing the Table of Contents of a book that he was writing.

 

After about 10 minutes, committee members complained that they did not understand the purpose of his presentation this morning, and that it was filled with acronyms that were not explained.

 

XII.       FEI Update

Bob Shultz welcomed Marie Hollein, President and CEO of FEI.  Marie reviewed some recent activities and initiatives at FEI.

 

Marie said that, according to the recent member survey, only 11% of FEI members know about FEI’s technical committees and advocacy activities, so FEI has invited two technical committee members to join FEI’s Office of the Chair (OOC):

·        Taylor Hawes of Microsoft represents CFIT

·        Marsha Hunt of Cummins represents CCR (FEI’s Committee on Corporate Reporting)

 

Regarding FEI’s structure, Marie said that six FEI members serve on the OOC, and that the full FEI Board of Directors includes the OOC, six Area Vice Presidents, six Area Directors, and the chairs of FEI’s national technical committees.

 

Marie reported that on August 26, FEI’s Board of Directors approved the addition of a new class of member, the 'Associate' category.  She said that this new category was established to enable talented, motivated financial professionals to have ongoing opportunities for personal and professional growth as their careers advance.  She said that membership criteria included a minimum of seven years work experience in finance, and a minimum of a four year college degree.

 

Referring to the member survey, Marie said that there probably were too many questions, so FEI will replace an annual member survey with shorter quarterly “customer satisfaction” surveys.

 

Marie said that FEI had assembled an International Task Force to help increase its global presence.  She said that CFIT members Bob Shultz (HP), Taylor Hawes (Microsoft) and Peggy Boissoneau (UTC) were members of this Task Force, and other members of the Task Force were from Honeywell and KPMG.  This Task Force will recommend what FEI should look like internationally.  Marie said that FEI held a meeting in India in August of potential members for an FEI India chapter, and has planned another meeting in India in October.  Other meetings are being planned for the United Kingdom, China, and possibly Japan.

 

Marie said that FEI was developing a Social Networking Platform, which should be completed by the end of January.  She added that FEI also planned to reorganize its Website.

 

XIII.      Business Intelligence and the SMB

Bob Shultz welcomed Kathleen Rohrecker, Marketing Director, and Babak Nassirian, Solutions Architect for ArcPlan.

 

Kathleen provided an overview of their presentation:

·        Organizations’ behavior is impacted by size, culture and structure;

·        Business Intelligence (BI) technology is integral to an organization’s overall push to drive corporate performance

·        With the importance of knowledge workers in the global economy, it is imperative for SMBs to succeed at BI;

·        Many BI-related technology constraints persist year over year;

·        Mid-sized companies have recently outperformed larger ones and provide some lessons;

·        Data and application growth are inevitable, making data integration a critical technology success factor;

·        Some BI platforms match up well with SMB requirements.

 

Kathleen discussed the BI Effectiveness Quadrant

 

Centalized Gut-Driven	Entrepreneur In Charge	Egos and Optimism
De-Centralized Metrics-Driven	Team to Beat	Out Performers
	SMB	Large

 

Kathleen said SMBs use BI to grow the topline, and Large companies use BI to cut costs and expenses.  She added that size does not dictate management style, yet management style is a determining factor to the effectiveness of the BI implementation.

 

Kathleen then described some qualities of SMBs:

·        They are more likely to be privately-held;

·        They could be on a steeper growth curve;

·        Management is closer to day-to-day operations;

·        They have fewer IT resources (both in numbers and skill mix)

·        They need intuitive products.

 

Kathleen said that the promise of BI is that it can help your organization perform better:

·        BI can drive productivity through reduction in time required to:

o   Generate reports;

o   Distribute reports; and

o   Find needed information.

·        BI can provide fuel for the knowledge worker to make better decisions:

 

XIV.      Social Media

Bob Shultz welcomed Melissa Krasnow, Partner, Dorsey & Whitney, and Certified Information Privacy Professional.

 

Melissa described some social media business issues:

·        An organization needs at least 25 fans to get a vanity URL

o   www.facebook.com/companyname

·        Facebook pages cannot be transferred once they are set up

·        Review Facebook’s terms of service and privacy policy

·        Twitter imposters can say anything they want, true or not, and potentially hurt someone’s reputation

·        Customer service for Facebook and Twitter is basically “self-help”

·        Companies can be a victim of a social media backlash based on what people say about them

·        All public tweets since Twitter’s inception are digitally archived at the Library of Congress

·        Social media sites are subject to spam, malware and phishing

·        The FTC made an enforcement action against Twitter in 2010 because of a lack of data security

·        There have been complaints to the FTC against Facebook

 

Melissa provided recommendations for a company’s use of Social Media:

·        Register key trademarks as Twitter usernames and Facebook vanity URLs;

·        Monitor social media;

·        Consider all disciplines and areas affected by social media;

·        Review company procedures and revise or establish new policies as needed;

·        Make sure company policies are consistent and integrated; and

·        Train marketing, customer service, human resources, investor relations, employees and others who handle company’s social media;

 

The committee agreed that Melissa Krasnow should be invited to present in the 2011 FEI Summit IT Track.

 

XV.       Adjournment

The CFIT meeting was adjourned at 11:30 a.m. CT on Friday, September 17, 2010.

 

 

 

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