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Among the many flights that CFO Stefan Schulz has taken between Minneapolis and Houston over the years, few are etched in his memory better than a certain return flight to Minneapolis—during which he created an ambitious list of Sarbanes-Oxley (SOX) action items. The list that Schultz created in the air that day was long and detailed, and while he may not have ever used it as such, the list was the muscle behind an ultimatum.
“I was thinking about all that I would need in order to get things fixed. Basically, I was thinking, ‘If I don’t get these, then you need to find somebody else,'” explains Schulz, who at the time had not yet been a month into a new job with Lawson Software when he determined that it was time to alert Lawson’s board and upper management to its snowballing SOX compliance challenge.
“To my surprise, they told me, ‘We want you to do exactly what you said’ and ‘We’ve got your back.’ This really changed how I approached problems and how I would recommend solutions going forward,” explains Schulz, who had earlier earned his SOX street cred while a controller at BMC Software.
Fourteen years and multiple tours of duty as a CFO later, Schulz is still flying back and forth between Houston and Minneapolis and still making lists. These days, his action items are more likely to highlight the priorities of a SaaS CFO for whom the new rules of customer-centric finance loom large and customer success is increasingly top-of-mind. –Jack Sweeney
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Guest: Stefan Schulz
Company: PROS Holdings, Inc.
Headquarters: Houston, TX
CFOTL: Looking back (before PROS), can you share with us a finance strategic moment?
Schulz: At one point, we were looking to do a major acquisition, one that was going to double the size of the company. We were in the process of doing due diligence, and the other company we were looking at was a public company. I was leading the team to go out and do the due diligence and really figure out if this was a company we could put together with ours. When we did the work, we came to find out that there were not just problems, but potentially really bad accounting practices.
. . . So bad that we felt like it would be something we couldn’t tolerate. I had to go back and tell the leaders from both sides that we had issues, and I was recommending that we stop. Which was not a very popular decision, as you might imagine.
Fortunately for me, I had some key advocates inside the company and on the board of directors who really wanted to investigate this further. And we did. A month later, the company ended up having major issues. Ultimately, the other company went bankrupt and the executive team on the other company’s side ended up being terminated. So it was one of those “Phew!” moments.
It was hard to go through that process and then have the realization that I needed to go and deliver news that nobody was going to like. But it was also easy, on the other hand, because the work we had done, the team of people we had out there, had done such a good and thorough job that I felt very convicted and very confident in going back with my recommendation.
But you know, that next month, as I said, when we were really doing our additional work, I was sitting a little bit on pins and needles because we had halted a very strategic move that both companies were pretty excited about. That was probably my biggest finance “Aha!” moment, which is: Never be afraid to stay true to your guns, be convicted on the things that you and your team have worked on. Even if it’s unpopular, deliver the news and stand behind it. That’s been a big lesson for me. One of my biggest accomplishments as a financial executive has been the deal that we didn’t do.