Yahoo has been a pervasive force in how we connect with the world and digest news. Formed in 1994 at the height of the dot-com boom, Yahoo was the original guide for the Internet and its transformation has been something to watch. As technology advances and consumer needs shift, Yahoo worked diligently to stay ahead of the curve. I recently spoke with CFO Ken Goldman on his role in an industry that has been rapidly evolving for the last two decades. Ken’s insights show how the functions of the CFO have developed over the years – and how that the evolution will continue – quicker than you think.
This interview has been edited and condensed.
Jeff Thomson: You became CFO of Yahoo in 2012. As a financial professional, what drew you to this role? How did you approach your position from a leadership standpoint knowing you’d have to make some quick and tough decisions?
Ken Goldman: Before becoming CFO in 2012, I was the original CFO of At Home Network in 1996, which was presumably one of the most influential intranet companies in the net scape of that time. We helped create the broadband industry, which didn’t previously exist because it was primarily a dial-up industry. This work had always fascinated me, but I left the company when the ownership structure changed in 2000. I always said if another opportunity like this came my way, I would be very excited to be a part of it again. So when Marissa Mayer, CEO of Yahoo called me, we talked about potentially joining the team. I gravitated toward the role and immediately expressed interest. One thing led to another and I wound up joining the company because I knew I could provide value for the Yahoo brand.
Thomson: You have a long history of working in the tech industry and have a reputation for “thinking operationally, effectively cutting costs and improving oversight.” How did you apply this knowledge and experience to your work at Yahoo? How can CFOs shift their thinking and work more operationally, instead of solely being focused on day-to-day tasks?
Goldman: Marissa had knowledge of the technology and internet industry and had a vision for the company’s future. Together, Marissa and I went on to help reshape the Yahoo culture to be more consistent with the industry. In tandem, we had to balance those goals with costs that support financial and organizational strategies. We looked closely at various aspects and did a number of things to improve our culture so we could focus the strategy on improving the core of the company. Some areas of improvement we focused on were:
• Communications - we have an all-hands meeting every Friday afternoon
• Accountability for goal setting each quarter as well as employee reviews
• Working environments to reflect a refreshing and open look and to our buildings and spaces
From our initiatives, we were able to change culture and attractiveness of our company to aid in our overarching goals. Without this change, we wouldn’t have acquired a number of small and large businesses – which helped acquire talent we were in dire need of to accelerate into new areas of mobility.
Thomson: If a CFO is looking to effectively cut costs, where would you recommend they begin? How should they counsel the C-Suite when suggesting strategic changes?
Goldman: For a number of years we benchmarked best practices. By tapping into both internal and external knowledge, we were able to better map accounting and transactional functions and measure their competiveness and effectiveness across operations. Benchmarking every operation allowed us to compare and analyze so we could align our structure over time. In addition, we have our Global Approval Matrix (GAM) which assists us in reviewing costs. Personally, I like to approve costs at a small level so I’m up-to-date with what’s happening internally. Finally, I believe assessing and reducing costs to save money allows for innovation elsewhere – for example with investments. Re-investing these funds in areas of engineering and new products allows for the company to grow and stay ahead.
Thomson: The management accounting profession is consistently evolving. With 2017 nearing, what trends do you think CFOs should be prepared to tackle in the New Year? How are you planning to evolve as a financial leader?
Goldman: An existing trend over the years has been that people went to a good school and would take their education to pursue a career in investment banking or consulting. Now, you see more people come out of banking and go directly to work in the technology field. The CFO function has specifically increased in relevance, visibility and recognition and is a preferred career path. With 2017 nearing, the interesting thing to note is things will keep changing. The ability to bring information to the forefront is really important. If you compare this to a few years back, you’ll notice the wealth of information is higher and regulatory requirements have increased dramatically. Additionally, being a good sounding board to the CEO and C-suite help run the business successfully. The CFO role has certainly changed over time and now has greater significance in helping companies grow than it has previously.
