siliconindia | | June 20208TRANSFORMING THE PROFITABILITY OF ANY BUSINESSBy Mr. Gary Lee, Chief Financial Officer & Vice President, Canon Indiausiness owners and executives need to take necessary actions to increase the profitability of the company. Keeping the focus enthralled to growing essentials, they can overcome challenges. The most important growth essential is maintaining a balanced sales portfolio. If they invest in different products and reach out to different target consumers, they can successfully mitigate the negative impact on one portfolio. As there is a saying, one should never put all their eggs in one basket for better profit results and cost check.The second most imperative factor is keeping a healthy cost-structure within the business. For this, the businesses need to reduce the overhead costs so that they can tide through unexpected downturns and take on-time necessary actions. A critical component for maintaining a required cost-structure is preserving growth fueling resources of the working segments and the probable ones. Keeping an eye on the health of the balance sheet regularly for ensuring assets' quality is significant also. Moreover, it is pertinent to monitor the inventory regularly so that there is minimum write-offs in accounts receivable conditions.Dominant Constraints Holding Back a Company's Growth and Overcoming ThoseBusinesses face challenges and constraints when they move toward growth and profitability. Timely identification of these challenges can help in minimizing the impacts. Successful companies plan for these challenges well in advance and learn to adapt quickly. One of the dominant constraints that any business can face include saturation of the market, where we see the products are getting more homogenous. With competition businesses getting aggressive on prices and aiming to capture the maximum share, it can create a severe dent in your business. Sometimes, there is a drastic change in the market either with the entry of a new player or a new technology, resulting in a transformation in the consumer behavior. This could also have an impact on the existing portfolio of the businesses resulting in de-growth.While it is possible for organizations to work the way around these constraints, corrections to financial constraints are often complicated. An integral part overcoming this, lies in the capability of the business to have a clear market proposition. A business can differentiate itself by comparing its propositions with the competitors. The next step to this is strengthening the existing product numbers through extensive research and development. It will enable the companies to disrupt the market. Canon, for instance, is the leader in patent registration and through our investment in R&D we are coming up with best in class technology for our customers across segments.Role of CFOs ­ Performance Management, Innovation and Market DynamicsCFOs look at the world from a different prism. Every business they are involved in face rapid changes ­ both internally and externally. There are fewer businesses that are immune to disruption. In times of accelerated business changes, it makes sense for looking into newer opportunities BGary has vast experience in working for the finance sector. At Canon India, he leads the Finance and Taxation, and Legal and Corporate Communication.IN MY OPINIONGary Lee
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