154: The Sweet Smell of Growth, Shiwali Varshney, CFO, Vosges Chocolate

The following is unedited abstract* from the CFO Thought Leader podcast featuring Shiwali Varshney, CFO, Vosges Haut-Chocolat and Jack Sweeney, co-host of MME Thought Leader.

VARSHNEY: I think it was like I would say it is a continuation of an ah-hah moment for me. When I was in Turnaround, I often looked at companies and I am kind of developing this theory that the company as an organization is like an organism, everything is connected. And I try to build it, if I'm building a strategy or a new business model for a company, I try to build and start with a black box. This is what this company takes in and this is what it produces in terms of services of products.

From then on you say, what is our mission? What are the three goals that we are trying to achieve? You build processes around it. You build your incentive systems around it and then you measure things that will help you achieve your goal. So all of those things have to be a tight fit, without that, you cannot bring in change in any organization. When I came to Vosges, what I was told before I joined here was that it has been an entrepreneurial company and we wanted to grow at a much higher pace than we were growing. So, when I came in, it was clear that some of the processes needed work, but also it was clear that the analysis and the measuring that we were doing were not giving us a clear picture of how our business is doing. So, that's when I started with looking at my own team which were doing more data entry type of work and I slowly replaced my team and enhanced it by more analytical capabilities.

So now, we're not only just doing data entry but we are also looking at data and explaining how if our business is not doing well or doing well in certain cases, why isn't it doing well, what is the hurdle. So, we set up gross profit hurdle rates, if you're launching a new product, the close profit needs to be a certain percent. Then we have also set up for a customer what is our breakeven number of bars sold per week per SKU.

So those are the things that people were kind of looking but not grasping how it impacts profitability and revenue. So now, by talking to them and showing this data, I think they're slowly getting that feeling, so now we're making decisions that are more facts based. I wouldn't say that we're 100% there, we're probably 80% there. There are more processes that need to be built but it's a work in progress.

*Note: This unedited abstract may contain electronic transmission errors, resulting in inaccurate or nonsensical word combinations, or untranslated symbols which cannot be deciphered by our transcription process. This abstract may differ from an edited transcript of the same interview in content, page and line numbers, punctuation and formatting.