Woolworths Holdings Limited management was excited about the prospect of creating a leading southern hemisphere retailer comprising David Jones and Woolworths with pro-forma combined revenue of over R51 billion from 1,151 stores across 16 countries. Things started off well in the 2015/2016 year but soon after the Australian investment faced serious headwinds and had to be impaired. The then finance director Reeza Isaacs describes it as a ‘whirlwind experience with lots of lessons that no MBA in the world could ever teach’.
‘One of the most challenging days was having to go to the CEOs office to inform him that we had no option but to impair our investment in David Jones. It is never fun being the bearer of bad news,’ Reeza says.
Family
Despite such difficult moments, Reeza does not let the work get to him. In his view, work is not an end in itself. In life, he is guided by a strong set of beliefs and the strength he draws from his family is something ‘no amount of money can buy’.
‘You shouldn’t take your work too seriously,’ he advises. ‘People lose too much sleep over their jobs as if their day-to-day hustle is something that will solve world peace or put an end to a refugee crisis. Do not stress yourself out because it is unlikely that people are living and dying on the basis of your decisions.’
To strengthen its balance sheet, the group took the decision to sell some of its Australian properties. The sale of the David Jones Elizabeth Street property in Sydney netted R5,6 billion. The sale was part of a process to restructure its Australian debt. Recent times have been demanding: apart from the historic under-par performance of the Australian business, and there was the COVID-19 pandemic to contend with.
Lessons
The Australian experience has taught Reeza a few important lessons, such as when it comes to mergers and acquisitions, the numbers you see on a spreadsheet are frequently much more attractive than the reality. Companies that embark on acquisitions should keep in mind that post-merger integration is a very difficult process and this should be given due consideration prior to inking a deal.
Reeza also learnt a fair bit about resilience and says the job of a CFO of a top South African company is not for the faint-hearted. At EY, Reeza was responsible for running a professional practice which was quite collegiate. The corporate environment is much tougher and he has seen a number of executives come and go given the challenges that the group faced.
As a CFO, a critical characteristic for success is to be persuasive as one needs to put forth convincing arguments to the board, investors and lenders. However, in getting desired decisions over the line, one should be careful not to lose your values and the essence of who you are, Reeza warns. Minimize stress and do what is necessary to achieve balance by taking breaks and ensuring you get sufficient sleep.
‘I have a place at the coast where the family and I escape to as often as possible,’ Reeza, a father of four, says. ‘It is also important to sustain your family and social circles, particularly in these pandemic times where increased isolation is creating mental health challenges. I urge professionals to look after their spiritual well-being and try to have fun at the end of the day.’
Regrets and strategy
Looking back, Reeza doesn’t have any regrets and there is not much he would have done differently in his career, except perhaps to have ventured into commerce sooner instead of having such a lengthy spell in professional services.
When it comes to strategy, Reeza’s view is that executives should keep up to date with an ever-changing environment and seek wide-ranging input, including external perspectives on where the world is headed. Everyone in the company has to buy into the strategy and to achieve that the strategy has to be simple and understandable. ‘Clarity regarding where we are at and where we want to get to will enable the team to know what they need to focus on,’ he says.
Reeza believes if one hires competent people, you won’t have to micro-manage them by checking up on them every five minutes. He believes in empowering his team and also giving them the scope to make mistakes and work with them to improve their performance. He also stresses keeping lines of communication opens so that if there is bad news, one can deal with it as soon as possible.
Years of experience have enabled him to spot errors quickly and to have a sense of when things are not stacking up. ‘In the corporate space you need to have the capacity for dealing with many things at once and within a short space of time. As a result, you need to plan your time wisely and work smart. The retail environment in particular is very fast paced.’
This article is an extract from the book Masters of Money – Strategies for Success from the CFOs of South Africa’s Biggest Companies available here – https://www.takealot.com/masters-of-money/PLID90121297?gad_source=1&gclid=CjwKCAiAyp-sBhBSEiwAWWzTnmLGsW3EWthrsEzrN69lcPhFqkxkQjPsxSF6CHoP2oj6-XRBtDB5gBoCfA8QAvD_BwE&gclsrc=aw.ds
