‘Adding value to business is critical for our role’
Welcome to this SAIBA CFO podcast, SAIBA is the South African Institute of Business Accountants, it has more than 12 000 members and specialises in a wide range of disciplines such as accountancy and tax, training and development, career enhancement, legislation and financial reporting.
My guest today is Veliswa Rozani, she is a CA and she also holds an MBA. She has been a business professional for 14 years and she’ currently the CFO of NMI Durban South Motors. This business was formed last year when Barloworld sold its entire motor retail division to the company for R950 million and acquired a 50% stake in the business. She was the CFO of Barloworld Retail before this transaction, and she joined NMI Durban South Motors following the transaction.
Before joining Barloworld, she was the finance business partner lead at Johnson & Johnson Medical and a finance business controller at Microsoft South Africa. Veliswa, tell us a bit about yourself, where did you grow up and when did you decide that you want a career in accounting?
I was born in Umtata in the Eastern Cape and during primary school I moved to Port Elizabeth with my mother. I grew up in a family of ten children and we’re now all professionals in different disciplines across industries in South Africa. It was in grade nine when I first encountered accounting and from that day on, I set my sights on becoming a chartered accountant and I have never looked back.
You chose to take the accounting, the CFO roles, as opposed to auditing, why did you take that decision?
I think with auditing I always felt, when I left PwC, where I did my articles, that it’s probably easier to go back into the auditing profession, than staying there and specialising and one day wanting to be in commerce. Therefore, I chose to go to commerce to see if I would miss the auditing world but I believe that as much as auditing has its own value to add in the industry in South Africa and in the profession, but I really wanted to be on the other side of commerce to try to grow and also to contribute to the economy. So I chose that part of the CA route and I knew it would always be easy if I ever wanted to go back to auditing.
Let’s talk about NMI Durban South Motors, just tell us about the operations of the company now, how big is it and what is the core focus?
Actually, NMI Durban South Motors was formed about 25 years ago but Barloworld bought a stake in this company, and they’ve been in partnership with for 18 years. It’s concentrated in KZN and in the Mercedes-Benz franchise of the automotive industry. It’s been a family-run business and Barloworld has not influenced a lot of, and still doesn’t, the day-to-day operations of this entity. So it’s been a very entrepreneurial business but it’s always been underpinned by a lot of corporate governance that was brought through by Barloworld.
Prior to this transaction, NMI had about eleven dealerships and Barloworld Motor Retail had about 39 dealerships. So it was a huge increase in scale and it also introduced different brands, NMI was mainly focused on Mercedes-Benz but through this transaction
NMI now has a footprint in various OEMs, Toyota, VW, Audi, Ford that they didn’t play in before, it is now 52 dealerships across South Africa.
You were the CFO of the Barloworld Retail Division and I assume you were very involved with this transaction, just take us through your decision to move from Barloworld to NMI DSM and why did you assume the CFO role there?
NMI had its own financial director/CFO at that stage, and he was going into retirement, and he was going to retire right at the time when the transaction took place. So as the CFO of Motor Retail, an opportunity was presented to me to join NMI and I took it and grabbed it. It really was informed by the excitement that I had for the entrepreneurial spirit in running the business, it is important in terms of growth, and having shareholders who are in the business because sometimes it does change the dynamics of the business, how you look at growth and how you grow and strategise from that perspective. But that governance principle was also there, so it wouldn’t have been a huge transition for me to move into this organisation because what we were doing was fairly similar. So that entrepreneurial side of it was the attraction for me and to be part of this growing business that has now through this merger grown on a large scale and there are definitely opportunities to grow into the future.
You mention entrepreneurial spirit and, of course, the traditional CFO’s role was more on the accounting side, but I see you also did an MBA. Tell us how core are entrepreneurial skills to your job?
For me it’s very core because what entrepreneurial skills call for is for us as CFOs to really understand the industry that we play in as a business and to understand the competitive nature of the business and who the competitors are, and how do we then play in this particular industry to win a share. So it calls for a different thinking and a different way of doing things and really challenging the status quo and identifying opportunities in these industries that we play in to say how do we assist this business to grow into the future and make more margins and profit.
Although you don’t own shares, it is a business that you’re contributing to and, therefore, adding value to that business is critical for our roles and to be commercially astute to see those opportunities and bring them forth.
How do you think a CEO and CFO should work together and are there fixed boundaries between the two?
My view is that the CFO should be a co-pilot to the CEO.
I always believe, and as an example, if there was a presentation to be made by the CEO and for some reason he couldn’t make that presentation, a CFO should easily get into that role and make that presentation because there should be a very good alignment between these two roles in terms of where the strategy of the business is going. You should be comfortable to present the business, even as a CFO. As CFOs we should really understand the business because that is where you add value into the business.
The skills that you need to be successful in that co-pilot role, it’s not theoretical, you can’t be taught those skills because it’s way beyond accounting, what do you think the core skills are that you need to have as a modern CFO to really be productive in that role?
There are two skills that I think are quite critical, one is the ability to form relationships. As you say, that’s something you can’t be taught that skill and you have to have the ability to form relationships and understand that in a company there are different functions. In forming those relationships, we need to build trust. As CFOs today we really have to be trusted business advisor, where individuals, CEOs and operational directors can see that you really understand, you are interested in this business and I always say you have to be curious about the business you are in to understand, so that when the bounce issues off you, you have got the ability to understand them and advise them. Most time, we as the finance professionals, are seen as the policeman who says no.
I always say if something is unethical, it’s unethical and if it’s non-compliant, it’s non-compliant and we don’t go that route, but when you ask someone the question and say what are you trying to achieve. Once you understand what they’re trying to achieve and you match this knowledge and your technical skills from an accounting professional perspective, then you are able to offer alternatives that will not stray into any non-compliance matter and will still achieve what the business needs to achieve. That’s built through trust and through the relationships that you build.
There are many CAs also doing an MBA, do you think that is a requisite for a modern CFO to really be good?
I think it’s a huge positive contributor, I wouldn’t put it as a requisite because what it does and what the MBA has done for me because in the CA profession, we really focus on four critical subjects, which is accounting, auditing, management accounting and tax. What the MBA does, for me it brought the whole organisation together, moving from supply chain, leadership, human resources, the organisational culture and the impact of all these other functions in the business, and for the first time you get exposed to them. So this is the reality of what we’re going to be dealing with, it’s not only about numbers, even in the financial function there are people, there’s an environment, there’s a culture, either a motivated workforce or a discouraged workforce. Those are the softer skills we have to learn. Having done the MBA, I am able to conversations that relate to IT or human resources or organisational culture and be able to identify those even for the business, not just in financial matters.
I think it’s created a well-rounded CFO for me, and I think that’s what we need.
What books are you currently reading?
I’ve got Michelle Obama’s book, Becoming, I’m reading that because it’s always good to read about these inspirational women who have made it and sometimes not necessarily made it at a younger age but people who we can aspire to and see what they are doing in changing the landscape for women and how we can become more confident as we embrace that future.
Another book I’m starting to read is Robert Sobukwe’s book, just to understand the history of South Africa and the roles of these different individuals who played a role in the struggle in South Africa for liberation and not only from a liberation mindset, but from various aspects that we deal with in business because I do find that some of them do play a role and can influence the way we work day-to-day in this day and age.