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Full of Articles - Thinking about Promoting Your CFO into an Operating or Strategy Role? You May Want to Think Twice
When the Chief Executive Officer is looking to fill a senior operating or strategy position it is common to consider the possibility of promoting the Chief Financial Officer into that role. After all, CFO’s are senior executives who typically exhibit
According to USFDA, a combination product is one composed of any combination of a drug and device; biological product and device; drug and biological product
sound judgment and are used to being charged with great levels of corporate and fiscal responsibility.
From the CFO’s side of the equation their only potential to move up in the corporate hierarchy is to move out of finance and into operations or s
From the CFO’s side of the equation their only potential to move up in the corporate hierarchy is to move out of finance and into operations or s
; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.
Examples of combination products may in
Examples of combination products may in
trategy. For those CFO’s looking to advance their career this typically means taking on the title of President, Chief Operating Officer, Chief Investment Officer or Chief Strategy Officer.
As you can see from the text above it is only natural to con
As you can see from the text above it is only natural to con
lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.
sider the possibility of filling vacant C-suite operating and strategy positions by advancing the CFO. The problem lies in the fact that what seems like an obvious win-win move rarely works as seamlessly as all parties would like to think.
Case in p
Case in p
here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe
int…Most of us have observed the scenario where a CFO with little or no operating or non-financial strategy experience gets promoted to President or COO and have in turn witnessed the corresponding chaos that inevitably follows. The story usually unf
d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.
Combination pro
Combination pro
olds like this:
1. The CFO in their new operating role and increased position of authority decides to reduce commitments to business development. After all, what do all those people do except travel and spend money? It certainly is an easy way to cu
1. The CFO in their new operating role and increased position of authority decides to reduce commitments to business development. After all, what do all those people do except travel and spend money? It certainly is an easy way to cu
ucts have become life saving products for the pharmaceutical companies who doesn’t have many innovative molecules in their product pipeline and have been inc
t costs…
2. MarComm; it just doesn’t seem prudent to make such heavy expenditures on marketing, communications, advertising and public relations…And oh those events and trade shows that are so frivolous; I’ll reduce those commitments as well.
3. No
2. MarComm; it just doesn’t seem prudent to make such heavy expenditures on marketing, communications, advertising and public relations…And oh those events and trade shows that are so frivolous; I’ll reduce those commitments as well.
3. No
easingly used in the product life cycle management. Even the companies having product patents are trying to extend their product life cycle through the combi
w that some surplus funds have come back into the budget, I’ll increase commitments to IT, accounting, HR and let’s not forget legal...and so the story goes.
By the way, the changes noted above usually take place with very little communication which
By the way, the changes noted above usually take place with very little communication which
nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically
causes a sense of uncertainty across the enterprise and a corresponding rapid downturn in moral. What the finance savvy CFO has just done in his/her first few acts as a President or COO is disrupt the entire culture, increase cost centers and decreas
and physically. They need to rightly judge the benefits of the combination products and they have to even look at the risks involved when combining the produ
e profit centers, but boy is this operation lean and mean.
The reality is that the actions above will not likely impact the near term funnel, but when revenue starts to evaporate in forthcoming quarters because customers are not being serviced and n
The reality is that the actions above will not likely impact the near term funnel, but when revenue starts to evaporate in forthcoming quarters because customers are not being serviced and n
ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi
ew deals are not being added to the pipeline due to sales people leaving the company and the corporate brand losing visibility things will start to get a little tense. You see there is no substitute for operating experience. The most brilliant CFO if
ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.
Following aspects would a
Following aspects would a
void of operating experience will make similar mistakes to those mentioned above when taking over executive level operating or strategy positions.
At this point in time you may be saying to yourself the author really doesn’t like CFO’s. Quite to th
At this point in time you may be saying to yourself the author really doesn’t like CFO’s. Quite to th
dd to the challenges in developing combination products:
Which markets to tap where the combination products can do fairly well?
Which combination prod
Which markets to tap where the combination products can do fairly well?
Which combination prod
contrary, at one point in my career I served as a CFO and I understand better than most that CFO’s play a critical role in the success of any business. In fact one of my first recommendations to any client is hire the best CFO they can afford. One o
cts are meaningful and rational?
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin
f my next recommendations is to start mentoring the CFO in the non-financial aspects of business. After all, if the Chairman or CEO appoints the CFO to an operating or strategy role without the experience necessary to pull if off, the resulting chaos
tions increase the patient compliance?
What would be the developing cost?
How to tackle the risks encountered during combination product developmen
What would be the developing cost?
How to tackle the risks encountered during combination product developmen
isn’t really the fault of the CFO, but rather it belongs to the Chairman/CEO that set him or her up for failure.
Accountants rarely have training or experience in sales, marketing, advertising, public relations, non-financial strategy and tactics,
Accountants rarely have training or experience in sales, marketing, advertising, public relations, non-financial strategy and tactics,
t?
As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel
As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel
and usually have little experience in terms market knowledge from a competitive, production or operating perspective. Accountants are trained in debits and credits, assets and liabilities, and other matters pertaining to balance sheet and profit and
ping new procedures for reviewing their safety, efficacy and quality.
Professional from academic institutions, pharmaceutical industries, health care indust
Professional from academic institutions, pharmaceutical industries, health care indust
oss statements. They are masters of retroactive analysis as their job is to document and report on historical events.
Let it be noted that I am a strong advocate of sound financial governance and best practices in cost containment. However not when
Let it be noted that I am a strong advocate of sound financial governance and best practices in cost containment. However not when
y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products
applied in a vacuum irrespective of the ripple effect across the enterprise. An enterprise can have all the cost containment in the world, but without revenue what does it matter? At the President or COO level an executive has a broader sphere of inf
.
As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de
As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de
luence and will have many more points of critical contact both internally and externally than will the typical CFO. Therefore having experience across a broad range of skill sets and competencies is mission critical for a company’s executive operatin
elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.
Companies that provide selfless information through particip
Companies that provide selfless information through particip
g and strategy talent.
The moral of this story is simply to hire/promote the most experienced and discerning people possible into executive operating positions. This can and often does include a former CFO that has been properly trained and mentored
The moral of this story is simply to hire/promote the most experienced and discerning people possible into executive operating positions. This can and often does include a former CFO that has been properly trained and mentored
tion in industry events and feedback to regulatory authorities would be able to face the challenges and will be successful in developing combination products
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