Resilience
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Being CFO

As Chief Financial Officer it was my job to report how we were doing financially and raise additional funds as needed. Our annual bonuses and jobs depended upon hitting our numbers. The Board of Directors agreed that if our revenues for 1984 exceeded $5 million, and we became profitable for the first time, Henri would become Chairman and CEO in 1985, forcing our founding Chairman to resign, and preparing the way for our Initial Public Offering in 1986. David, our Senior Vice President of Sales and Marketing, and Henri had offices on either side of mine. They were my closest friends at Genzyme. We were all underpaid but eligible for large bonuses if we hit these targets. Our ability to raise more funds, and value of our stock options, depended upon positive results. Just after Thanksgiving David walked into my office and said we have a problem. My heart sank as he described the situation.

Our Maidstone enzyme plant was contaminated with a virus, so a large production order could not be completed before year end, leaving a hole in our revenue targets for 1984. He had been assured this was a temporary problem, readily fixable in early 1985, but not by the year end cut-off date. The customer would reluctantly take the contaminated product, so we could record the sale, and return it without paying for it, after their own testing, in exchange for some virus free product early in the next year. Or we could ship the product to them on December 31, 1984, recording the sale and profit, and have it returned to us early in 1985. Accounting rules would not count either sale in 1984. Missing our year end targets, over a production timing issue that was beyond our control, would have cost the company dearly, perhaps even costing our jobs.

This was a real test of our integrity under pressure. How we responded would set a tone for the entire company, one which would help define what we would and would not do in seeking success. We went next door to talk to Henri. He said of course conforming to appropriate accounting rules was my responsibility, but he didn’t want to lose becoming Chairman and CEO, or miss the year end numbers for any reason. We pulled the entire sales and marketing staff, and most of the accounting staff, together to call every customer with a January order who might take product from our inventory in December instead. By the week following Christmas we had eked out just over $5 million is bookable sales generating $10,000 in profit.

We had accomplished our goals, without sacrificing our integrity to do so, clearing the way for our future success, while making very public our commitment to be a management team that valued integrity as the company grew. During 1985 we would go on to clean up all of the company’s accounting, writing off any legacies from before my time, and imbuing the company with an ethic of integrity while working for the public good. We were determined to be a company with integrity. We were passionate about helping people and doing it honestly. That cultural context helped recruit some of the finest scientists in the industry, allowing us to feel good about the products we were developing, doing good even while doing well. Creating a company with extraordinary success and integrity was very important to us and our success.

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