Developing Innovative Solutions to BringDown Cost
By Fran Shammo, EVP & CFO, Verizon Communications
The CFO as Strategic Partner
As a business partner, Verizon’s finance team has earned its seat at the table with business leaders by providing them with strategic counsel and guidance as well as traditional financial planning and analysis support. We’ve increased our value to the business by understanding the opportunities and the challenges that the business units face in the marketplace and then developing innovative solutions that help to drive costs out of their organizations, increase their profitability and deliver shareholder value for our investors. Our finance team is an extension of our network and operations teams. By working together, we increase our ability to drive results.
As you probably saw, 2013 was a busy year for our finance team as we made a number of important acquisitions that will help us continue to drive growth and increase shareholder value. The most famous of these was our acquisition of Vodafone’s 45 percent stake in Verizon Wireless, but we also made important moves on the entertainment side buying Edgecast and Intel’s OnCue Cloud TV platform.
The model in which consumers watch TV is changing and these new assets will help Verizon adapt as viewing habits shift from linear television to over-the-top and IPTV
Focus on the End Customer Satisfaction
Verizon’s theme for 2014 is “Every Customer, Every Day” which is a reminder to us to always keep our valued customers in mind with everything we do. What I tell my finance team is that even though most of our customers are internal, we have to keep in mind that everywhere we work eventually impacts an end customer and that end customer pays our salaries. Our job is to help our business partners succeed because at the end of the day, we have to satisfy that end customer.
Streamlining the Systems: To Drive Out Inefficiency
As Verizon has transformed itself into a technology company, our finance organization has had to transform itself. Over the last 18 months, we have undergone significant transformation of our systems, our processes and our talent. We’ve made decisions on streamlining our systems that will get us to a company-wide financial platform for financial modeling, reporting and analyzing. This will result in quicker aggregation of our results and provide a single source for our data to be maintained. Last year alone we eliminated thousands of unnecessary cost centers which helps continue to drive inefficiencies out of the business. We’re using the Lean Six Sigma methodology to focus on improving existing processes and designing new processes right the first time. We’re also investing in many educational, professional development and business training opportunities for our employees.
Our finance transformation goes beyond the transformation of our systems and processes. In 2013, we also opened up two new finance office hubs in Tulsa and Lake Mary, FL. These new state-of-the-art facilities help us further improve the way we serve our internal and external customers. Now that they’re up and running, we’ll be able to concentrate on our process improvements even more in 2014. All in all the finance transformation delivered a total of $200 Million cost savings in 2013 which will carry forward with additional savings targets in 2014.