How to Be an Effective Team Leader in Treasury with Florian Heindl

Foreign welcome to this week's Treasury Career Corner podcast where I interview treasury professionals about their treasury careers. Each and every week I talk to them about how they build their careers, where they are now, where they see both themselves and the treasury profession. Going to next, let's get on with the show. In this week's show I'm joined by Florian Heindel, the group treasurer at FACC ag. FAC is a world leading aerospace company in design, development, production of innovative aircraft components and systems. We discussed this before, so I'm not going to deep dive about FACC but huge company, you know, employs 2,800 people, 38 nations, working in 13 countries worldwide. So part of the Vienna Stock Exchange. But as always, I'll get Florian to later on in the show to describe about the group and everything else. As we start every week I'm going to shut up, I'm going to let my guests do the talking. Florian, take us back if you were to how you discovered the wonderful world of treasury and well, finance and then Treasury. Over to you sir.

Thank you for having me on your show. Diving into my history, let's call it that way. My father was a banker, so I was always more or less confronted with money and money issues. So it was for me more or less logical thing to find way into finance. And that's also the tipping point of my career or the starting point. When I joined after my university Studies back in 2007, I joined Oberbank, a regional bank in Upper Austria where I joined the Treasury Department and was taking care of corporate clients in terms of derivatives trading, interest rates, FX and commodities trading. So initially I was on the banking side of treasury and 2007, 2008 Interesting times, challenging time financial crisis, very challenging time in the Bank Treasury. Actually 2007, 2008 very interesting times in terms of financial crisis and a very attractive learning period like for a young guy eager to learn and get more experience in financials. So a very challenging times actually what happened next that one of my corporate clients asked me to change sides. So moving from the banking sector to the corporate sector and that was, was what I actually did in 2012 when I joined a large upper Austrian utilities company and taking care or being part of their treasury and for the first time joining a professional corporate treasury, the large utilities company.

So, so why did that, why did that appeal to you sort of thing you made, you were in banking. Obviously it was a tough period and things like that. But you know, why did he or how did he convince you, you know, what was The. How did he tempt you from the, from the dark side. I'm joking. From our banking guys. No, but joking aside, you know, how did he. What was the attraction there really?

To be complete frank with you, the initial plan was not joining the corporate side, that the initial plan was back in 2007 or 2008, moving to the big financial centers, London, Frankfurt, even New York, whatever you want to call it. But actually no one was looking for a young professional coming from Austria and joining the investment banking ranks of the various big names. So this was my initial plan. To be completely honest, I am completely happy right now that I took the other path and joined the corporate side. As I said, a client of mine back then asked me to join corporate treasury and I said, okay, well give it a try. At least you see the other side as well. And it was the complete and totally correct decision that I took back then. So the good thing was I joined a real, really professional treasury back then. So really sophisticated professional processes, a large team actually with very good segregation of duties. So I filled a position as a Treasury manager taking care of asset management hedging and internal and external group funding. So, and it was for me, the two years I was with them, a very good and intense learning phase, seeing how a professional corporate treasury could be and should be structured. So that were my key takeaways, is first step in my corporate treasury career, how professional corporate treasury could be structured. So that were the key takeaways at.

My first corporate, first corporate role and things. And again, when perhaps people who are listening and they're in that situation now, you know, and they, they've just made that move maybe from the bank to a corporate and things. Was it in your head, right, I'm going to get these two years training and then I'll make a move. Or was it just, it just then happened, you make the next move or what was your attitude, if you like, around then?

It was twofold, I would say. It was of course always my plan, not being stuck at the standard treasury role, but I wanted to move on as a team lead or department head or whatever you want to call it. So that was always the thing I wanted to achieve. And as I stated, it was a very professional treasury already and not much challenges, I would say. And I was looking out for challenges. I wanted to create something, I wanted to structure a department by myself, I wanted to select employees. And that was the time and it happened to me when I was asked to join Pottinger, which is a large agricultural manufacturer in Upper Austria and they were looking for a head of Treasury. And I said, well, yes, let's try that. And so after two years I moved on and took the position as a head of treasury at Pottinger.

What was that like moving that sector at that time? So you're quite early in your career, you made the bank move, energy and then, okay, did you find treasury different or is it exactly the same, just different styles and levers sort of thing?

It was quite different actually because the utilities company was hardly owned by the local government and Pottinger was a really private, family owned company. So two different or completely different worlds in the end. So that was of course a difference. But to be honest, it was also exactly the challenge I wanted for me. I wanted to be in a private sector environment, no government influence, no political place, etc. Etc. So this was the also again, a very good decision and the right decision at the time. Very, very nice, very good move at.

The end of the show. We're not getting to the end of the show yet, but they'll notice with yourself. You're a few years younger than me. Yeah, we're not going to get into that, thank you very much. You're a relatively young group treasurer, if that's the right way to put it. But I'm not saying you have to be elderly like my good self. But, you know, you're in your first management position then as such, head of treasury there with a couple of reports. You know, what was that like? Was that that the transition for you? Did you find? And again, we try and give lots of advice to people on the show. You know, was that a big thing for you? You're then coaching, managing a couple of people, or was it actually, you know, they were colleagues and you just got on with it. What was the sort of ethos there?

I would not say that that was the big challenge for me. So I was always a team player, let's put it that way. So in terms of football, soccer, coming out of sports, I'm used to working teams and therefore it was, was not the big issue for me to be the head of a team actually and lead people, manage people, etc. So of course you have to learn a few things. People are different, personalities are different, that's quite natural. So of course I learned that was no issue. But in the end it was okay. I was very, I felt very comfortable in that role and it was definitely the time when I realized, okay, this is the thing I want to do. Yeah, I want to lead treasury teams, treasury departments that Is the thing I like working with people, managing people, being responsible for progress and development. That is exactly my thing.

And you know, there are some, you know, sexy companies out there, some really interesting industries and things like that. You were working for an agricultural machinery group, you know, and you know, very solid state industry and things. Was it quite traditional there or was it, you know, they were trying to change things or what was the sort of, you know, the ethos. And again, I'll say for the people listening, we have had a pre podcast call. I am going back through my notes because I think it was interesting some of the things that, you know, Florian mentioned when we talked before but you said it was sort of, you know, wasn't just that sort of traditional turn of handle, was it? You know, there's some good stuff there.

It was, of course it was. It was as I said, family business owned by two brothers. They were managing directors by themselves back then and also 50, 50, 50 partners in the company or owners in the company. So this is of course a completely different approach than being part of a billion euro utilities company, 50% owned by government. So completely different approach. And the interesting thing back then was that one of the brothers moved out of the company or moved out of the managing position, let's put it that way. And they were in kind of a transition period, bringing in for the first time in their 100 year plus history, external management as well. So interesting times seeing a company change away from the completely family business culture to a more professionalized approach, bringing in external management positions. So very interesting times as well. And seeing and experiencing the cultural change of a company. So also very interesting in terms of the young professional I was back then and maybe I'm, I still am. Yeah, young with a bit more experience right now. Yeah, exactly, still young, I hope.

And then you attempted to know what you made a move and you know, explain if you would, you know, that you made a move from Pottinger. You know, how did that come about? And you know, what was the sort of. Because you've had some really, you know, really interesting experiences since then. Then. So you then join FACC or you know, give us, give us a talk through from there.

Two and a half years in my career with, with Pottinger, there was an opportunity at facc. FCC had a very difficult time back then going through a fake president incident. And what they were doing is restructuring their finance departments, bringing in new people, new approaches, new mindsets and, and I learned about that opportunity and I said, okay, here it is the big possibility to Structure a department from scratch, selecting all the people I want. Because back at Pottinger there were already people on board in terms of Treasury. So I was heading an existing department in the end. And at fscc the big opportunity was building up my own Treasury Department from scratch, selecting the people I want that I need. And that was the big opportunity for me. And in the end it worked out fine. FSC selected me and I joined the company in November 2016.

Again, for the people listening, I gave a little bit of an overview of the group. Can you deep dive for them the markets and then how that sort of impacts on treasury and the scope of your role?

Hewitt yeah, FSC is a civil aerospace supplier, tier one supplier. So our customers are Airbus, Boeing, Embraer, Bombardier, the big names, the industry in the end. And again, completely different industry environment compared to manufacturing or utilities. Completely different industry approach, highly focused on quality and production processes. So again, very interesting environment, very international, I have to say. So 100% of our products are exported, obviously because there is no large aerospace industry in Austria. So we are, we are the biggest company in terms of that in Austria. So very interesting. The first time a really international approach was needed in terms of Treasury. So we have several international subsidiaries. And the task, or one of the tasks when I started back then, besides creating the treasury from scratch, was also finding a setup that is suitable for the global subsidiaries and have a more or less centralized treasury approach and implement that at fscc.

And when you did that, how did you roadmap it out or what was the. It was like, right? That's the end goal. This is what we're going to do. Give us all your money, guys, bring it all here, you know, or how did you lead that approach, if you like, if that's the right way, you know, was it going out and meeting little businesses and winning hearts and minds or was it just look with a big office? Thanks very much.

Yeah, it was more or less a combined approach, I would say, because also not only myself were new at the company, they also brought in a new cfo and the CFO started a month earlier than myself, so in October 2016. And he also came out of treasury, so he had also a professional treasury career. And it was more or less a team approach. Both of us had ideas how to structure the new Treasury Department at FSC where we want to move in the long term. And, and so we worked out at the beginning some kind of multi year treasury strategy where we want to be in terms of structures, in terms of funding, in Terms of systems in five years plus. So more or less a roadmap. I would say the most important thing in the beginning was of course bringing people on board. Being a one man Show Back then, 700 million euro turnover company was not that funny. So the first issue was of course selecting people and bringing people on board, supporting me. And the second biggest issue was creating a stable funding environment. I stated it already coming out of a big fraud incident. You have to rebuild trust in the company in terms of your banking relations. You have to secure funding. And that was a big issue back then. And so the first big project we, we settled on was creating a stable funding environment, cutting down our core banks and creating a stable banking club. And we did that with a large syndicated loan which was finally concluded in 2018. So this was the first big project I would say we implemented at fscc, which was very successful.

When you're looking at bringing on board new team members and everything else. Well, in fact, the end of last week and this week I was talking to one of my clients and they were saying, look, you know, I've arrived in this place, we've got to shake things up. And actually they're in the same situation. I'll connect you maybe after the show. They're going from this decentralized approach, some treasury senior treasury managers sitting there looking after about four or five countries and then another treasury manager a bit further over and looking after this and very localized and things like that. They want, the new CFO there wants to sort of bring those things together, you know, how did you roadmap that? And I mean again, I sort of use that again. But what I mean by that is you sat with the CFO and it was like, right, we need to everything here. But was the first, was the first person a systems person or. Actually it was a risk person. What, how did, what was your checklist?

It's not that simple because a centralized approach is sounding really nice. Yeah, but that does not work out in the end because you always have different environments, legal requirements, different attitudes, cultures whatsoever. So having a big centralized treasury in the end is a dream that doesn't work out. You will always be somewhere in between. You will have some localized centers as well. But in essence, in the end you should have a really global treasury strategy which is applicable to everyone with more or less freedoms concerning or suitable for the various companies you have in your group. That's the one thing. And the second thing concerning your question, who was the first person we brought in? The first person was a lady Very experienced in systems environments and also with a very long professional treasury career. So an expert, so to say. Because this was our second big project, we implemented Treasury Management system and a new payment platform which is now the basis for integrating the payment transactions in our group on one software platform. So she was the first person coming in and she had tremendous software experience, systems experience, but also process experience. Yeah.

And so you got her on board and then over time you sort of beefed up the team and things like that. And then you've actually taken on a more outward focus role over the past year or so. Actually within the past year. But your role sort of evolved from treasury to then Enterprise and Risk and then sort of more recently investor relations. So you've sort of been given a wide arrayment. What's that been like? And you know, from your, you know, your humble beginnings in treasury, you know, I say that, but you keep proving yourself so great, oh, here you go, here's something else to do. Or how's it sort of transitioned in with you? You know, how's it sort of been taken on board?

I would say it was always coming out of some guys left the company. In terms of 2018, it was our Enterprise Risk Management who was leaving the company back then. And the question was, okay, what, what shall we do as a company? Shall we replace the guy and have a separate enterprise risk management department, or shall we integrate it into Treasury? Because we already have a guy, Mr. Handel, who is taking care of financial risk management. The guy seems capable at least to taking care of another responsibility as well. So what we did back then is integrating Enterprise Risk Management into the Treasury Department, bringing on board an operational risk manager. Before that, we already brought on board a lady in the classic Treasury Department taking care of our insurance business. So also not the classic treasury task, I would say, in terms of insurance, but we also have that here at FSCC under the responsibility of Treasury. And in 2018, we merged with Risk Management and enlarging our focus in terms of the classic enterprise risk management tasks when it comes to internal control systems, when it comes to business continuity management, and not only the financial risk management in terms of interest rate or FX hedging or credit relations or whatsoever.

Everyone's bored of COVID everyone's bored of the pandemic and everything else. But it's the question at the front of most people's minds and how companies have reacted to and got through it, if you like, and, you know, how have they coped with it? And if you like, I want to ask That a little bit. And where do you see it transitioning to you know who? Again, I talk to people who's been embracing flexible working or is everyone coming back into the office? What does it mean for the world of treasury as we go forward? You know, what's your approach if you like?

I think it will be a combined approach. In my opinion it will definitely not going back to normal. So everyone sitting in the office and I see it with, with my company with FSCC we learned how to cope with home office. It works, it always worked at FSCC but it now is more intense and more standardized and we will definitely not go back to the classic office environment. And within my teams we already discussed that. So it will be a flexible approach. And for me, to be honest, it doesn't matter if you are in the office or at home. The most important thing is work has to be done and the team has to be functional. And functional teams in my opinion have to have some personal contact as well. And you cannot always or only do webexs or conference calls or whatsoever. You have to meet in person because you have to socialize, drink a coffee with your colleagues, have chatter, also private chatter. And that's important as well for the well being of your team. And therefore we will have definitely have a combined approach. We will take that what fits best. That might be two days at home, three days in office or for another person it's three days at home and two days in office, whatever that might be. But I think the general trend will be a mix of that. Definitely not the classical office approach from the past, but a more flexible approach going in the future.

I'm part of a business group where we talk to other business owners. I'm a recruiter. There's other guys in other industries. I won't give all their details but there's been quite a difference. You know, one, one is in estate agency so the everyone needs to get back in now. Another guy, he's in a different industry but you know, they've chosen because you know, they need to show people houses and that's one of the key things. Although they've got included that flexible working one of the other guys, I felt that he is still holding on and you know, we had a further chat about it afterwards. I got used to the idea that we've got to, you know, show trust in our teams and really, you know, I've always trusted the team but it was more just letting them get on with it and trying to support. Are there any ways that you Demonstrate this. I know we've talked about virtual zoom coffees with people or now we're going to get back into the different learnings that you would take from the past year or so. Or what would you think?

The learning from the past year on our end was definitely, you have to know that two thirds of our employees are blue collar workers. So in the production and it's difficult to offer them home office that does not work. So you have to be very, very careful in terms of communications, etc. Because we do not want to separate between the blue collar guys and the white color guys. They are all FSCC employees and they should be treated similar so no injustices. So therefore this was the learning you cannot offer only to the white collar people, full home office weeks, etc. You have to communicate very carefully and this was definitely a learning from the past year that you have to take in mind all your employees in the company and there are employees where home office is no option and you only, you also have to offer something to them as well. That's very clear.

Florin, you talked there about flexible working and the sort of, you know, coming back in that staged approach. I was just, we were talking before and we've talked about this. I do a lot of recruitment in the US and there's a couple of my clients I'm not going to exactly name, but one's over, over in the sort of Washington state area, sort of west coast of the US and so they sometimes struggle to get the staff. And actually I was talking to one of the treasurers recently and I said, no. So you've gone from, you know, February last year, you know, 100 in the office, everyone work. Yeah, yeah, yeah. And now you, you've done a year of flexible working. Yep, exactly. I said, oh, so you're going to come back out of that? What are you going to do? Because he struggles to get staff and get them into the office sometimes, you know, thinking, actually this will be great, great opportunity, maybe, you know, a couple of days here and there. And you know, people can still combine both, just like you've talked about, Florian. But the weird thing was you said, no, no, no, we're going to come back five days a week. And I'm like, and I didn't want to ask, you know, how foolish that was because I know how it is, you know, I'm thinking, hang on, you're just actually cutting off some good, great candidates you could get and, you know, and changing and evolving and it's a bit frustrating. But you Said, you know, it's all about trust and you know, what other things are you thinking, Florian, as we.

Come back, we will definitely do it differently in the future. That was also a learning because as you stated, FSCC is also not really in the middle of things bit I would say in the rural landscape, so not, not so easy to be reached for candidates, etc. Etc. And that was definitely a negative point in the past. And we also had hard times in recruiting and what we learned is offering home office is bringing in totally new candidates and this for us a very worthwhile thing to do for the future. So we are definitely integrating that in our recruiting approach and I think that can provide value to efficiency.

Yeah, and it means you get the best talent because if you know you're doing that and things like that and yeah, I think it's so anyone listening, please just try and listen to those words. You know, from a, you know, experienced recruiter, from an experienced treasurer, you know, this is exactly what you need to be doing. And that leads me on to Florian, you've taken on more responsibility through your role as it sort of evolved, if you like at facc. And you and I talked previously about, you've taken on, we talked about risk, but then also you're passionate about investor relations and the communication there. And you know, explain that again why you're so interested in that and you want to explain it to the audience if you like.

That was another opportunity that arise at the beginning of 2021. So the former head of investor relations at FSCC quit his job and again the discussion was okay, should we replace the guy and separate investor relations department or should we integrate it into Treasury? And I had a discussion with my CFO and the picture was really clear to be honest, because what did we have in the past? We had two separate communication ways. We had a communication way through treasury to our creditor relations in terms of banks, Schulzhain, bondholders, whatever. And then we have the classical investor relations communications to the equity guys. And I said, hey, let's combine those two streams and have treasury and investor relations. And that's definitely worth it. And that was my experience from the, from the past already five months. There is really value in it because what the also the equity investors and analysts like is talking to a Treasury guy, having the understanding in terms of finance, funding, covenants, all that stuff. And that really provides value. Even more valuable is having just one communication stream to the market. Message is always the same both on the debt side, DCM side and ECM side. So I only can recommend it from my point of view, trying to combine those departments.

I had a very similar conversation actually with one of my treasurers the other day and we were talking about, he's, he's done exactly the same. And I said, oh, you know, how is it, you know, what has it changed with you? And he said, get to the point. Like, whoa, whoa, whoa, all right, calm down. And he was just like, no, no, that's what it is when you're doing ir. He said, it's about getting to the point within treasury you sometimes have to explain things and you know, so people for understanding and things. You're, you're talking generally to a very educated audience in their field specifically. Just get to the point. Straight away. He said his CFO was just said, no, cut it in. There was a four page slide, a four page deck would become one page. And he said this, this, this. Do you find that yourself?

That's definitely true. And what's also true is that you have different mindsets. You have the banking side, debt capital investors. They are thinking different than an equity investor. Do you have different valuation approaches and you have different questions. If you're talking to one audience or the other audience, it's sometimes different. Different focus, different questions. That's highly attractive, to be honest, because you're also learning as a person. Your team is under constant challenge. So we also brought on board now an investor relations lady supporting me. So a very diversified team already. They are benefiting from each other, learning and cooperating well. So very worthwhile actions we did in integrating investor relations into Treasury.

Amazing, amazing, amazing conversation. And I think, you know, I'm not going to labor anymore because I think it's just been great. And you know, sometimes with some of my clients, I'm sort of, they're, you know, going too much into detail or we're trying to get a good view. I think you've just given exactly the right amount as we go through. And so we will put your LinkedIn details and your LinkedIn profile in the show notes so people can connect to you. But as people, as always, they look back through your background and say, do you know what? I want to have a similar background to you and to that guy and I really want to be, you know, like him. What advice would you give to any of those aspiring treasury professionals that are just, you know, wanting to follow in similar footsteps or follow a career path just like yourself? What would you say?

I would say be flexible, be brave and don't be afraid of uncharted territories. Yeah. So if there is an opportunity in a new field, like for me it was risk management, enterprise risk management. For me as well it is investor relations. Take the opportunity. You will learn, you will grow as a person and that brings you forward.

Amazing. Flexible. Be brave. I'm loving those two. Well, we're going to have those in the show Notes. Lauren, thank you very much for your time today. I think people are going to get heaps of value, as they always do from the podcast, but particularly from this one. I really appreciate you sharing your story, sir. So thank you very much.

Thank you, Mike. It was a pleasure. Thank you.

Thanks. Hello, it's Mike here again. I hope you enjoyed this week's show. If you did, then maybe you want to follow the show or subscribe, depending on where you listen, whether that's itunes, Spotify, or another great place to listen to the show from. It's totally free and means that you'll be the first to see each and every week when we release a new show. And maybe whilst you're there, you could even leave a quick review. Reviews and ratings are among the most important metrics for a podcast to effectively rank. And as you can probably appreciate the podcast, there's a lot of hard work to produce every week. It'd be amazing. Just take, say, 20 seconds, leave a quick review of my amazing guests and their great career stories. We'd really appreciate it. Thanks very much and I can't wait to see you soon.