A CFO can be an integral part of decisions including client pitches and business development meetings: Sumit Agrawal, Cheil India
Sumit Agrawal, Head of Finance, Cheil India, says, “As large media groups have resorted to inorganic growth opportunities to fast track their growth and sharpen their service offerings, the CFO has a key role to enable organic and inorganic growth opportunities”.
For Sumit Agrawal, Head of Finance, Cheil India, a CFO is an integral part of the strategy of the company and helps to monitor the progress. “The CFO is looked upon as the authority to highlight risks, monitor business and financial performance, lay down process guidelines and overcome taxation and compliance challenges. The CFO helps to draw a fine balance between business requirements of speed of execution and adherence to processes,” he said.
Edited Excerpts
Tell us about your career trajectory and journey? Where and how you started and what got you here?
Professionally, I am a chartered accountant and postgraduate in business management from the Xavier Institute of Management, Bhubaneswar. I am an alumnus of Sherwood College, Nainital and hold a bachelor’s degree in commerce from Shri Ram College of Commerce, Delhi.
At present, I am working as the Vice-President of Finance with Cheil India and have been working with the company since 2019, leading the finance and accounts, taxation and legal functions.
Post MBA, I started as a group management trainee with the Aditya Birla Group, predominantly working with the CXOs in the cement and carbon black businesses. I also played a key role in the initial growth phase of Brand Capital - Private Equity Business of The Times Group. Subsequently, I led the finance planning and analysis function at HCL Infosystems Ltd and ReNew Power, before joining Cheil.
What led you to join the advertising agency ecosystem in finance? What were your initial impressions and thoughts of the advertising business?
Having worked with the Times Group for over five years, as part of the deal making team, I often interacted with professionals from the media and entertainment industries, including advertising agencies. The media or advertising industry is very vibrant and recognises talent, hence there are always opportunities to contribute and grow.
In Brand Capital, I closely interacted with promoters and CXOs and have always believed that brand building is a very important aspect for all companies in order to target their stakeholders, be it customers, employees, investors, regulators etc. Each of the companies have their own growth trajectory and brand building helps to amplify that growth potential.
How has the role of a CFO in an ad agency changed over the years? What does the job entail today? Where have you seen the biggest changes in what the role and function means to the business?
The importance to the role of the CFO has dramatically increased over the years. Apart from budgeting, financial planning and analysis, cost management and supporting regular business operations including accounting and funds management, the CFO plays an important role in compliance and risk management of the organisation.
The CFO is an integral part of the strategy of the company and helps to monitor the progress. One is expected to be versatile and work closely with the business team.
How do other departments and functions in the agency view the role of the CFO and the finance function?
The finance function helps to support regular operations of the company and help the business teams navigate the process requirements of the company. The CFO is looked upon as the authority to highlight risks, monitor business and financial performance, lay down process guidelines and overcome taxation and compliance challenges.
The CFO is often called upon to mitigate risks and also facilitate ease of doing business. The CFO helps to draw a fine balance between business requirements of speed of execution and adherence to processes.
Where do you have the best synergies - in terms of working with other functions and areas that need more work?
The finance function works in a cohesive manner with other functions to ensure adherence to business objectives and processes. The finance function monitors the business performance across various profit centres and cost centres.
Since the advertising industry is getting more competitive, there is a need to maintain a balance between revenue growth and profitability.
What's the CFO's take on how the agency business model has evolved? What have been the key changes and disruptions according to you and what has been the impact of these shifts on the ad agency business model?
The advertising agencies are looking at enhancing their capability to be able to meet all the branding needs of their clients. Further, they want to leverage the capability of each of the business functions to be able to work more coherently and enhance their service offering.
Cheil has developed capabilities in all spheres of digital media, traditional media, out of home, film production, activation, retail branding, performance marketing etc. such that the entire product offering is available to their clients through a single window with the ‘business connected agency’ approach.
Agencies are facing a few disruptions. Is the business model future-ready?
The advertising industry is facing threats due to technological disruptions through AI, evolving consumer behaviour, regulatory changes with respect to data privacy laws etc.
In order to expand and sharpen their existing service offering, agencies are looking at both organic and inorganic growth opportunities to be future ready. Agencies are leveraging new technology and data driven insights to remain relevant.
From your observation, do you see any gender inequality or disparity in the finance function across levels?
Though the finance function mostly comprises men, there is no gender bias or preferences across levels.
Agency leadership has traditionally been male dominated and advertising was seen as a boys club. Does that hold true for finance as well and the CFOs in advertising?
The agency leadership is gender neutral; however gradually, an increasing number of women professionals are joining the industry.
What are the steps ad agencies must take to advance CFOs' role in advertising?
Agencies need to invest in talent development through providing opportunities for industry interaction and continuous learning. Further, cross functional collaboration will help to encourage knowledge sharing and build operational efficiencies.
The CFO can be an integral part of the decision making beyond pure financial matters including client pitches and business development meetings.
What are the trends you are currently witnessing in advertising, and what is the role of a CFO in such a scenario?
India’s growth story has helped the digital media advertising industry to emerge as the fastest growing medium of advertising. Personalised targeting is becoming important. Influencer marketing is becoming an integral part of the brand promotion strategy. Accordingly, data driven insights and e-commerce integration are becoming increasingly important.
As large media groups have resorted to inorganic growth opportunities to fast track their growth and sharpen their service offerings, the CFO has a key role to enable organic and inorganic growth opportunities. The CFO needs to deploy business finance resources to closely monitor the ROI and other KPIs (Key Performance Indicator).
What according to you are the biggest threats facing the advertising agency business today?
Apart from technological disruptions, client retention and share of wallet (due to budget constraints of clients) affects advertising agencies. Further, talent acquisition and retention is a challenge as there is scarcity of skilled professionals.
