507: All Eyes on Cloud Spend | James Denena, CFO, Snow Software

Listen to the Episode Below (00:36:13)

As for many CFOs, one company more than others dominates James Denena’s finance career building years. Denena spent more than 10 years at Applied Materials of Santa Clara, California, where an executive development program encouraged him to move around inside the chip maker’s sprawling finance organization. While Denena filled traditional FP&A and treasury roles, he also actively sought out different operational roles that could provide him with a more wide-eyed view of the manufacturing side of the business.

However, it was his involvement in the expansion of a corporate development function that Denena today singles out as having perhaps made the greatest contribution to his CFO mind-set. “I was one of the early team members who actually built the function out,” recalls Denena, who says that the newly minted team quickly became involved in M&A activities and was soon being sought out as an adviser on different strategic decisions across the company.

CFOTL: When a company adopts a SaaS subscription model, how does the mind-set of a finance team change?

Denena: The finance team had to start to think much more about creating long-term value for our customers, because when you’re not in a SaaS world or you’re not a cloud company, you think a little bit more transactionally. You think about a customer as someone you sell to, you collect from, and you move on to the next one. Of course, you collect maintenance from them, but you think of it much more transactionally, and the entire company thinks that way. Especially, finance and accounting orgs think that way, because they’re just looking at it from a dollars-and-cents perspective.

As you become a SaaS business and your products are much more in the cloud, you really change your mind-set to where you think about customers in a very different way. They become an integral part of your business. They are no longer just that transactional part; they actually become much more of the lifeblood of your day-in-and-day-out. Because of this, you have to put yourself in their shoes much more than you ever did before. This could mean, for example, how you handle things from a collections perspective. It could be how you work with the engineering teams in terms of the ease of use of the products. It could even be how you construct your contracts to be a little bit more customer-friendly, to allow them to get onto the platform with you. It’s knowing that if you treat them right, you’ll get rewarded in the long term for those moves.

It wasn’t obvious to me when we first started the transformation that it was going to be so pervasive, and even pervasive within the finance team. But this was something that, over time, became very evident. Now here at Snow, we’ve got a very similar kind of situation. It’s part of the mind-set that I’m trying to bring to the finance and accounting teams here as well. jb