How AI Is Changing the CFO Playbook

Megan – 00:00:31: Today my guest is Ashwath Bhatt. Ashwath is an experienced finance leader with global and multi-market experience with a demonstrated history of partnering with business leaders to improve financial performance. Skilled in FP&A, strategy, acquisitions and divestitures, commercial finance, pricing, controllership, treasury operations, and financial analysis. Ashwath participated in GE's financial management program early in his career and is a chartered accountant from India. Ashwath, thank you very much for joining me on today's episode of CFO Weekly.

Ashwath - 00:01:07: Thank you, Megan. Thanks for the time and thanks for having me.

Megan - 00:01:10: Yeah, today we're gonna be discussing artificial intelligence and finance. It's a hot topic these days, and it's just starting to scratch the surface of what it's capable of. And I'm really looking forward to learning about the application of this technology, specifically in finance, and how we should be thinking about it now and in the near future. So let's jump right in.

Ashwath - 00:01:31: Thanks so much, yeah. All there to go.

Megan - 00:01:34: So you have over 20 years experience of working in executive finance roles. Can you tell us more about your career path and the key experiences that have helped shape your approach to finance leadership along the way?

Ashwath - 00:01:47: Yeah, thanks. So I basically started my career in 1998 as an intern at IBM in base sort of India. So I'm a chartered accountant, which I can more or less call as equivalent of a CPA in the Indian context. So I started as an intern at IBM and then later, once I finished my internship and finished my CA, I joined GE in its finance leadership program. So that's where I started and within GE finance leadership program, it's a very well-known program, I think has given innumerable CEOs and CEOs to the corporate world, especially in the U.S. I think I learned, relearned all my, again, accounting, control of ship, strategy, all the skills in GE. I started with GE Capital, then moved to GE Healthcare, and then I was with GE Power Systems and finally took up a job in GE Healthcare. I would say the key thing that I learned there was mainly it was around turning around the business. So the business side had undergone a kind of a shock, an accounting issue, which led to almost riding off $20 million overnight, $20 million, maybe almost 23 years, 24 years back right now. It was a lot of money, especially in India, in the Indian context. So it started with control of ship issue where there was no real fraud, but it was just bad bookkeeping. So what I learned is that yes, there are a lot of, again, accountants, but at the same time, doing basic, again, data entry properly and then analyzing and reporting is equally important because a lot of times people spend or rather want to learn about how do you analyze better? How do you kind of collaborate with the business better? All those things are extremely important. But again, if you don't have your basic accounting correctly done, then everything else that you're going to do, can be a waste of time. So I think I learned the importance of control ship, the importance of ensuring that if you have a purchase order, there is no real, any other verbal commitment outside of the purchase order. And on top of it, cash flow really reflects the performance of the business because a lot of times profitability can be made up in Excel sheets, but cash flow or cash in the bank is a true reflection of the business. So I spent around seven and a half years with GE Healthcare in India. Then later I took up a job with IBM again in India, where I would say I learned mainly about how to expand businesses, in places like India with real long-term contracts. So IBM had. 10-year contracts with three big telecom players in India. And IBM also grew rapidly in that time period from around 2006 to 2010. So it was all about, how do you craft a longer term deal where you go and solve the client problem across like not bothering about how much of that is for hardware or software or services or consulting, how do you kind of combine all of that and solve the client problem? So that's what I would say I learned mainly in my IBM stint. And then 2010, towards the end of 2010, I joined Nielsen. I was based out of Dubai, managing almost initially around 13 countries, and later expanded to manage around 28 countries. So it was a geographic CFO role. From Nielsen's headquarters perspective, it was almost like the wild, wild west. They did not really understand What are the compliance-related requirements. How do you grow in all these places? Like if you just look at demographics for something like Africa, it's a huge continent with lots of people, and lots of opportunities. But again, if you still need to get your statutory audit done on time, you still need to ensure that your vendor payments are done correctly in compliance with the local laws and ensure that there's no real fraud that's happening. So if you are operating in a country like say Saudi Arabia or United Arab Emirates, you are ensuring that labor compliance is in place. You have a good program around it. You are operating mainly with expats and with a specific visa, so you don't really go around any rules. So I would say my stint in Dubai managing Africa and the Middle East was again more about understanding controllership and compliance while still continuing to grow the business. In this sense business growth is important, but at the same time trying to grow it without creating any risk for the overall corporation is equally important. I moved to the US in 2015, initially as FP&F or the whole of Nielsen. So that's where I learned. A lot about how you manage a public company FP&A. So starting from giving guidance, working with the Investor Relations team, preparing for board meetings, and preparing for quarterly learning calls. So it was a great education in terms of how to manage finance for a public company. So working with the CFO and working with the CEO of the company quite closely, was a great experience for me. Then I took some of the divisional CFO roles within Nielsen, which was again, very helpful. Nielsen bought a company called Grace Note from Tribune Media. It was a large acquisition with more than 2,000 employees and more than $200 million in revenue. So how do you integrate a tech company into a company like Nielsen, which is technology-oriented and, at the same time, has been around for almost 95 years at that point in time? How do you integrate a West Coast tech company into a company like Nielsen, which has a lot of legacy technology? I think that was again, a very interesting experience. So it was all about M&A and integration. In all the roles that I talked about, I have constantly focused on getting growth along with profitability. So that goes without saying. But in terms of say acquisition of Grace Note, I'm integrating that within Nielsen. So it was a great M&A experience for me. Post that I have done finance transformation roles. How do you upgrade your old SAP to SAP S4 HANA, or how do you implement Workday or any kind of cloud-based software for HCM or HCM systems? And also when the pandemic started, how do you kind of really flex the cost muscle and ensure that you kind of right side of the company to take care of like headwinds in terms of revenue? So that was what I did with Nielsen and for the last one and a half years I've been with Fractal. Which is an AI and analytics company. It has been an eventful two and a half years. Our revenue has gone up substantially more than two and a half times in these last two and a half years. We work with mainly Fortune 500 companies, solving them or helping them build algorithms to solve their day-to-day business problem. And I say day-to-day business problems, it's important problems like revenue growth and reducing their cost and becoming more efficient. And how do they ensure that they digitally transform themselves and get ready for the challenges of the 21st century? So that's what my company does. And purely from a finance perspective, as I said, we have managed a tremendous amount of growth, and partnered with businesses to improve profitability. Again, worked with every other stakeholder to improve our own internal systems to get better lead indicators, and KPIs which really helped us run the business in a much better way. So yeah, that was maybe a very long summary of what I've done over this.

Megan - 00:09:28: Yeah, it's been a very impressive career to date.

Ashwath - 00:09:31: Thank you.

Megan - 00:09:32: So what was it that drew you to your current position as CFO for Fractal?

Ashwath - 00:09:37: I think after having worked for three companies, which were like again, GIBM and Nielsen, all the three were more or less, Nielsen got 100 years this year, but the other two were way past 100 years. I very probably believe companies are also, most of the time like human beings. So they, like all the three names that I mentioned are great companies, don't get me wrong. But once companies do get old, I do think like, yeah, how much ever you want to be active at the age of maybe 80 or 90, you are likely to slow down a little bit for sure. So I wanted to work in a kind of startup kind of, Fractal has been around for 23 years. So it's not a startup with just two years of history. So it does have 23 years of history, but it also behaves like a 23-year-old person, which is a lot more energy, a lot of, again, spring in the steps, and a lot of dreams for, or rather future aspirations. So I wanted to be part of a company with very high growth potential and high growth, both history and potential. Because in some of these older companies, like 5% is a fabulous growth. But when it comes to, again, a company like Fractal, like 25% is not really a great growth, right? So it's like you need to be growing much faster than that. So I think the growth potential of the industry and the company, and then second, I would say, is the culture. I think Fractal has a very unique, focused culture, and it's very easy for every company to say that yeah, we are trying to focus I don't think there is any company that says that they're not client-focused but it's also about the culture that kind of manifests on a day-to-day basis to give you an example every board meeting we start with net promoter score. So, we don't really start with say revenue or profitability, etc Yeah, we do discuss all those things but at the same time you always start with the net promoter score It is in everybody's gold sheet within the company every employee has a goal around net promoter score. So this whole idea of client before the company company before the team and team before self-culture that she can't and when I have built within my company I think that was the second biggest attraction for me like I could go into the before the interviews like I could get into the company website and see some of the town halls that were put up for any public consumption like there is a weekly town hall that happens in the company where any employee can ask any question to the executive team. So, it could be a simple thing like something around reimbursement policy It could be something like a compensation related question or it could be around the strategy of the company. So, I would say the growth potential and then I would say the culture were the two main things that drew me towards factor.

Megan - 00:12:29: Sounds like a wonderful place to work. So how do you think the role of the CFO has evolved throughout your career? And what does the profile of a modern CFO look like?

Ashwath - 00:12:41: Yeah, I think that's a great question. So if you really look at the CFOs of the past and CFOs, ultimately, some of the KPIs, or rather, what the CFO is trying to do is maximizing shareholder value and stakeholder value. I don't think that has changed in the sense, and if you take CFO maybe 50 years back and now, I don't think that has changed much. Ultimately, you want to ensure that for every investment that has been made by the company, you get the maximum out of it. But what has changed is, I think, again, the tools that are available for us to get. Like when I started in 1998, we used to run payroll. I used to run payroll for Siemens' local branch using Excel. So I think Excel sounded like a wonderful tool because my first job, rather the first day of my training in our chartered accountancy firm in India was to take a local telephone directory and add up all the numbers, the telephone numbers, in each page using a calculator. So that was done to kind of check the calculations, and skills of a person. And so obviously, the total was always, somebody had the answer sheet, so they would check, okay, how good are you in terms of calculator? I think from there, where we have come right now, with Gen.AI, I think it's a long way. So what I'm saying is, the tools that people had, I think that has changed drastically. And I recently signed up for advanced Excel training. So again, advanced Excel may not sound very sexy right now, but again, the tools that are available have kind of evolved drastically over a period of time. And CFO, initially, there was a lot more focus on controllership and getting the audit done, right? In the sense, okay, you are ensuring that the balance sheet is clean, the P&L is clean, and auditors are happy, and the controls are in place, your cash flow and the cash management are in place. So I think that was more of the focus, obviously, along with taxation and tax planning, et cetera. But right now, the CFO is definitely expected to be part of the leadership team, driving the strategy of the company, and even the execution, that's not just strategy. And the strategy is, again, not to confuse strategy with planning, so the strategy is all about the choices that the company needs to make, right? It's all about where you wanna play and how you want to win versus, say, detailed steps. So I think CFOs are now very much involved in strategy, so it's not saying that, okay, if it is revenue growth, it's not just the CRO of the company who is involved in that, the CFO is equally involved. And then any investment, so every investment, and what's the ROI on those investments? So I think you are equal, both the stakeholder and a decision maker within the company. So I would say the tools have changed dramatically over a period of time. There's a lot more automation than what was there much before. And the expectations of partnering with the business have changed dramatically over a period of time.

Megan - 00:15:48: And how do you think the evolution of technology and cybersecurity is impacting businesses? And how can CFOs ensure that their finance functions are flexible enough to deal with these rapid changes and increasing threats?

Ashwath - 00:16:02: Yes, I think cybersecurity is very important. Again, both data privacy and cybersecurity are going to be more and more important. Obviously, with the technology evolution, everything is on the cloud, which means that with the connectivity, there are a lot more hackers who want to get hold of your data and destroy the credibility that you have with your clients or with your customers for a ransom or whatever. So there's a saying, I guess, in cybersecurity saying that it's not about when you will be hacked. It's not about whether you are hacked or not. It's more about when you will be hacked. So it's something that you should assume that I think all of us as CFOs or any CXOs should assume. That it's going to happen someday. So what plans do you have? What kind of disaster recovery do you have in place? What backup system do you have in place? What kind of further mitigation? Like all the cybersecurity tools, right? Obviously, trying and avoiding, how do you create zero trusting environment? Zero trust, just the word itself is not a great word, but at the same time when it comes to cybersecurity, I think building a zero trust environment is extremely important. So I would say it's about, we should all be prepared, assuming that it's going to happen to us at some point or the other. And what are the next steps if it were to happen? So how are you going to kind of react to it? I think be prepared for that. But it doesn't mean that, okay, we'll not take any caution to avoid it. So ensure that you understand what the tools that are available are what are the ways in which people can get into our system and what kind of SOC or all this security operations control team you can set up to ensure that you are not, ideally you should not be getting hacked, but be prepared for the worst.

Megan - 00:17:53: Yeah, it's definitely a scary place. I mean, they're getting very sophisticated and the frequency seems to be increasing, with which they're trying to wreak havoc.

Ashwath - 00:18:04: No, absolutely. I think. Yeah, and I think with everything being on the cloud, I think it's only going to increase, I don't think. With cloudification, I think we have been hearing about cloud for a long period of time, but I think I don't recall the exact statistics, but I think it's somewhere close, ballpark, I think it's still less than 25% of the data is on the cloud. So that means there is still 75% that will get onto the cloud and the cybersecurity threat is only going to kind of increase. So should the caution be.

Megan - 00:18:37: And in your experience from working at an AI tech firm, how can AI aid finance leaders?

Ashwath - 00:18:44: I think my boss says this all the time, I think because there are always discussions as to is AI a threat to employment in the future. I think, yeah, the longer term view, I think it's always very difficult to predict, but in the short term and the near medium term, I would only say this, like, people who know how to use AI will definitely outperform people who are not using AI. I think that part is extremely clear. So when it comes to, be it finance leader or any other leader within the company, I think using or understanding how AI can help us is going to be extremely important. I'll give maybe some use cases so that it kind of comes to life. I'm sure every company has an HR policy or human capital policy, be it around leaves, be it around travel, etc. Or there are going to be finance policies for various employee-related things. So now it's very easy to kind of create a chatbot. So instead of somebody writing a mail saying, can you please tell me what's the travel policy or people being given a booklet then they try the company. I think now like my company already has, we have a chatbot where you can go and ask a question about, say, my leave policy or what happens in case of a maternity policy or a paternity policy, so leave policy. I think the chatbot can easily help people kind of completely automate something like an understanding of a policy or Q&A or somebody, instead of somebody writing an email and somebody having to get back within say 48 hours, 24 hours, or setting up a call center. I think bots can do a much better job saying, okay, tell me what's my limit for say telephone reimbursement or some other internet reimbursement. I think it's much easier to kind of have a chatbot for everybody in the company where they can just go and ask that question and maybe go and ask follow-up questions where the natural language is easily understood. It's a very simple use case. Then, like again, even applying for leave, for example, even within my company, I can just go to the chatbot and say that I'm going to be on leave for three days next week. It understands, okay, next week, first three days, whatever, and goes and updates our workday system saying that, okay, this person is applying for leave. So I think a lot of tasks within the company, within finance, within HC can be automated. And again, going back to finance, the whole robotic process, automation, the whole reporting, then creating building scenarios. I think a lot of that can be done through and even using unstructured data and language models to look at the data and come up with a conclusion, summarizing specific calls. So assume we have a particular budget call, so then use AI to summarize the call. I think the capabilities of AI will be endless. I think it's all up to the leaders to see how they can find usages to it. Like if I want to go and find out liability clause or limitation of liability clause in every contract that or every master services agreement that I've signed, yeah, you can just like obviously within our system, you can use a GENAI tool, GPT 3.5 or 4 to ensure that, yeah, you can summarize it and look at where there are exceptions instead of, again, somebody going and reading 130 contracts. I think you can get a bot to do it. So yeah, I think the potential is immense. I think, unlike a lot of technology trends that have been hyped up in the past, I do believe this one is real. And I think we are maybe in the. 1995 stage of the internet versus, I would say, 2005 stage of the internet. So we are definitely in the early stages, but the potential is limitless.

Megan - 00:22:48: And if you look out, let's say, five or 10 years, do you ever envision a time where there's no need for a finance and accounting department because it's all being done by AI?

Ashwath - 00:23:00: I do, I definitely don't see a scenario where there won't be any need to be finance and accounting or say legal or paralegal. I think there will be different sides of finance and accounting where, which will be, some will be impacted more, and some will be impacted lesser as we've discussed before. Anything that's more transactional will definitely get impacted more, but anything that has more to do with decision-making, I think will still be kind of impacted much less. So what I'm trying to say is that if I want to understand the ROI for a project, my ability to calculate the ROI using AI will be that much more or the ability to use multiple data points or build multiple scenarios. I think those things can be done much faster and fewer people can do it. But ultimate decision-making will still have to be done by human beings. So my hypothesis or rather the way I see it right now is yes, the transactional nature of the jobs, like it's passing, say a journal entry or something to do with more payables process or collection automation, following up of the emails, following up for collection. I think a lot of that will be automated. But when it comes to say decision-making, should we be giving somebody 60-day payment term or a 30-day payment term? I think that's a call that will still be being made by human beings. But you will have a lot more data to decide than what we have right now. A lot more dashboards and a lot more, again, digital cockpits to help the CFOs and other senior leaders.

Megan - 00:24:35: Do you think that utilizing AI presents any specific challenges or risks that finance leaders should be aware of as they roll out AI and look to start using AI? Are there challenges or risks that they should have their eyes open to?

Ashwath - 00:24:52: My thinking around that is. Yes, there are challenges in the sense a lot of times I see even some very simple tools like spreadsheets or Excel. People keep blaming Excel for some wrong outcome and most of the time I find People blame the tool when they don't understand the business. I think over-reliance on any tool without understanding the underlying nature of the business, how clients react, and how ultimately everybody is in the business of delighting their clients or customers. So I think any financial model that's built without understanding the overall say, what's the total addressable market? What's the total serviceable market? So basics of business, what's the competition doing? What's the competition not doing? What's our again, what are the choices we are strategic choices we are making? So anything that's being built just by say taking a tool and putting an algorithm and just extending the algorithm, over-reliance on a tool without understanding the core business, I think always prone to fail. And I think it's already like I've seen that happen even with some basic tools that are out there right now. When I say basic tools, I mean CRM or ERP or things like that, which are, if you were to call them pre-AI automation tools or digital transformation tools. They did drive a lot of productivity, but at the same time, if you don't understand the business, however smart the outcomes are there from AI, I think you'll end up with the wrong decision-making.

Megan - 00:26:27: That's really good advice. I guess it kind of comes back to garbage in garbage out.

Ashwath - 00:26:33: Yes, absolutely. I think that's well said. Also, I see within the company, I think getting this whole data flow and understanding them clearly for a CFO is very, very important. Again, it goes back to the concept of garbage in garbage. But what I've seen happening, especially in functions like finance, is there's so much of focus on strategic finance, being a partner for the business. Believe me, those are absolutely very, very, very important. But as I think spoke about in the beginning, if we don't have the right source of data feeding into the system, however, the smart AI is like, I think, yeah, it's not likely to be a good outcome in the end. So when people are looking for skills, I think if we completely say that, okay, there are certain sets of skills that are just not going to be important. Yeah, I do see that being dangerous in the end. Yes, when I talk about say transactions getting automated, yes, that's going to be important, but if you don't know how those transactions are going to flow into the system, like simple things like say capitalization of fixed assets, right? So yes, you can automate a lot of those invoices just coming into the system and like obviously getting capitalized, but assume there is somebody who has raised a PO within the company, maybe breaking a process, but the invoices come to that employee, and that employee has just kept the invoice in his drawer. I don't think however the systems are, you are unlikely to find it out. What I'm trying to say is, the basic controls, and the principles of audit, I think those things are equally important if technology will not solve all the problems.

Megan - 00:28:22: And what's your strategy for managing and balancing the cost of innovation and growth, including the financial demands of high-cost tech departments?

Ashwath - 00:28:32: Yes. Now, thanks for that question. Because I think just today I was discussing with someone, like every SaaS business, I think obviously measures, what's the CAC versus LTV, right? Everybody wants to look at, OK, what's my customer acquisition cost versus my lifetime value for every client? But when it comes to spending, I've seen rarely any of the finance professionals looking at, OK, what's my lifetime spend? If I get into a SaaS contract for solving any business problem, I would say if you get into a million-dollar contract a year, a lot of times we tend to focus only on, say, a million dollars. But my sincere suggestion is to multiply it by 10, because any SAS tool you get, it's not going to be easy for anyone to replace it immediately because they are pretty sticky. And the cost of replacements tends to be very, very high because there's implementation cost and other data flows where they will get involved. So my suggestion is that whatever decision is being made, I think, keep almost multiplying the expense by 10, and then look at the ROI keeping that in mind. So look at the lifetime spent and what is the return on that investment versus just looking at, say, one year spent and trying to look at the ROI and feel good about the fact that, OK, I bought something which is going to have a very high ROI. So like how, I guess, say, companies which are selling the SAS products, I myself in Tractor, we do have quite a few SAS products. So yes, we do look at our cap to LTV pretty carefully. But what I'm saying is when you're on the other side of the table, when you are buying a lot of the SAS products, it could be simple things like, again, ERPCRM to every other pricing tool or HCM tool or any tool. Multiply it by 10 to get to this thing of almost like a, whether we want to multiply it by 10 or 15 or 5, I think that's a judgment that leaders have to use. But getting at the lifetime cost of a particular product that is being bought and then looking at the return on that investment is equally important. And getting from now, I'm only covering, say, when you talked about, say, high-tech cost departments. A lot of times the high-tech cost of the department comes from the people cost within that. I learned a long time back that every expense in the P&L needs to be looked at as an investment. So in this sense, every expense in the P&L should have a justification as to why it should exist. So that's the basic foundation for zero-based budgeting, right? Not saying that, okay, I spent 2 million last year, so this year I'll spend 2.1 million. That's that anybody can do that in Excel. But every, that 2 million in my example again, every dollar in that needs to be justified with what's the return on investment. So, I would ask the same question whether buying an SAS tool, whether somebody's just hiring people or has already existing people, what is the real return on investment? Again, looking at the lifetime cost, I think it's going to be very important because we are always very good at multiplying the benefit by various years or multiple years. The benefits are always multiplied by various years to arrive at the ROI, but pretty bad at multiplying the cost by various years to arrive at the ROI. I was with somebody yesterday who said, that cost is like nails, you ought to keep cutting it, otherwise they keep growing. So I think constantly looking at them is very important.

Megan - 00:32:12: And speaking of cost-cutting, we're in the midst of some pretty challenging economic time. So do you have any strategies to prepare for and manage during economic downturns?

Ashwath - 00:32:24: Great. So again, going back to my cyber security, what I was talking about, we should always be ready. I think economic downturns and they're like ultimately if we all live in a capitalistic society or capitalistic economic framework. So the downturns and the boom periods are kind of the part in parts of the same thing. So I believe every CFO should constantly have, it should be ready a plan A, plan B, and ideally you want to plan C for the economic downturn. So that's where scenario planning generally helps a lot. So for scenario planning, it's always like saying that, okay, what happens if my revenue grows at say 10%, versus what happens if I'm at say flat versus say what happens if my revenue really declines? So understanding your variability of your costs, like how much of your cost is truly variable with revenue, how much of it is really fixed costs like rent and how much is semi-variable and how much can you really variable all your fixed costs and semi-variable or semi-fixed costs. However you want to look at it, I think is extremely important. So I'm saying building various scenarios as to what it means if you were to again grow really well, what it means if you were to have a lukewarm kind of growth, and what it means if you were to say that, okay, I had a pretty bad year. So what are the costs which are truly variable and what are the costs? Okay, they are fixed in nature. How you can make them variable in the sense that, again, if you have fixed like a GNA cost, right? So how can you ensure that some of that is more contractor-based where you can kind of pull the trigger up or down or the lever up or down to kind of match the revenue? I think it's a good way to manage downturns. One more thing I'll just say about the downturn is that it's also equally important to understand what's happening with the competition. So it's important to also invest ahead of time, especially in downtowns when everybody's cutting costs. So it might sound like I'm saying something contradictory here, but it's also a great time to invest so that when ultimately the boom period comes, you can really outgrow your competition. So again, it's all about capital allocation. So when you talk about capital allocation, it's all about which are the costs you're going to cut and which are the costs you're going to kind of double down on your R&D and kind of which will give a huge return when kind of the spending again picks up. Just to give you an analogy, this is something that I use and keep thinking about constantly. As all of us have like, there is some healthy fat, which we all need in the body, maybe 10% of the body weight, somewhere close to that. There's always visual fat. And then you have muscles like all of us have muscles. I always looked at R&D spending or even the cost of goods delivery or cogs. It's like a muscle, right? It's something that's very important for the bodily function. A good amount of healthy fat is like a GNA that's absolutely important so that the company works very efficiently. And you should constantly be going after visceral fat, which is not the best thing for any human body. So I have always looked at wastage as visceral fat, which people should constantly be going after. It's never, I haven't seen a company where you can say that, okay, like, no, I'm done. I'm absolutely clean. I think it's a daily activity that people should be doing. Or rather, you have enough KPIs or other lag indicators will say that, okay, there is wastage getting accumulated in certain parts of the organization. So looking at the wastage versus R&D spend, which is going to really help, versus keeping your lights on or the BAU cost to run the company. I think looking at the cost into these three different buckets is generally very helpful.

Megan - 00:36:22: Do you have any advice for CFOs on how they can keep up to date with rapid technology changes and increased use of AI?

Ashwath - 00:36:32: Yes, I think I can talk about personally what I try to do. I'm generally updated on, again, being part of the AI company, I do keep speaking to some of the experts in AI. Again, when we say AI, it's a large field. So how can you use a different use case? I talked about how something can read a contract and maybe spit out only the exceptions. I'm saying that in your company, you already have subject matter experts, I think talking to them and making them understand your use cases and connecting the dots is very important. If not outside, I would say like, I do listen to a lot of podcasts relating to AI again. Alex Friedman is somebody who kind of comes to my mind immediately. But there are again, a lot of other podcasts where the latest trends in AI are being talked about. I think that's another good way of keeping yourself updated. My own company CEO, Srikanth, I think again, gives a lot of public talks, which I listen very carefully to understand. Because he's a subject matter expert. That's another way of kind of, again, keeping myself updated. Outside of that, yeah, I do kind of have a news feed whenever there is anything got to do with AI or technology kind of comes through. I used to and I still do follow, like Gartner, who keeps publishing various, again, thought leadership articles on using AI specific to maybe finance, hack head group. I think I would say that again, listen to some of the experts. And I have also made it kind of mandatory for everybody in my team to tell me what is that one or two processes, that they will completely automate in the next six months to nine months. So my whole audit to cash process is getting automated. So it's also by challenging them, I'm also learning a lot because they go and do their own research and study. So I'm kind of piggybacking on my team to understand the latest and greatest in AI and the use cases.

Megan - 00:38:42: That's a great idea. So last question, what is it that keeps you up at night these days? As you look into the future, what is on your mind and what concerns you?

Ashwath - 00:38:53: I would say again, how do we continue to grow the company? I think that's a key thing that does worry me. And how do you kind of keep your revenues and costs aligned? Like especially in the inflationary environment where inflation is seeming to be stickier than expected. So I would say, how do you manage the inflation? How do you ensure that you drive internal productivity to offset the inflation versus how much can be charged, again, can be ideally charged to the client without hurting client delight, I think this is the other balancing act that I do worry about. Ultimately, it goes back to are we as a company keeping ahead of some of our competition to delight the client is my, I would say it's both a concern and something that excites us and excites us and gets us to work on a day-to-day basis. That will be as long as you are taking care of the clients and really delighting them. We also have one of our goal statements is to deliver a billion dollars of value to each of our clients. And that's not something that is just the statement, we measure it pretty closely. So I would say, yeah, ensuring that are we really delighting our client is the thing that I worry about the most because if the client is happy, I think the growth will always happen. So any place where again, the delivery to the client is not in a great place, I think is the cause for worry.

Megan - 00:40:22: Ashwath, thank you so much for being my guest today.

Ashwath - 00:40:25: Thank you and again, thanks for the opportunity. I really enjoyed this conversation.

Megan - 00:40:29: Yeah, me too. I've enjoyed speaking with you and thanks for finding the time to be here with us today to share all of your experience and knowledge. I wish you and Fractal all the best. You're both doing very exciting things to shape the future.

Ashwath - 00:40:42: Thank you. Thanks a lot, Megan.

Megan - 00:40:44: And to all of our listeners, please tune in next week. And until then, take care.