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73: Lee Kuyper

Chief Operating Officer and Financial Director – SilverBridge Holdings
‘SilverBridge is really in the business of modernisation, digitalisation and intelligent automation.’

14 September 2020

CIARAN RYAN: This is CFO Talks and I'm extremely happy to be able to welcome today Lee Kuyper, who is both chief operating officer and financial director at JSE listed SilverBridge Holdings. SilverBridge Holdings provides business solutions to the financial services industry. Given the rate of technological progress in this space, this is clearly a frenetic time to be involved in that business. First of all, welcome Lee, how are you?

LEE KUYPER: Thanks very much, Ciaran. I'm doing well, thank you.

CIARAN RYAN: We've also got Nicolaas, who is the chief executive officer of the South African Institute of Business Accountants with us. Nicolaas, how are you?

NICOLAAS VAN WYK: Hi, Ciaran. Hi, Lee. It's nice speaking with you again and sharing the stage with the CFO Talk listeners. I’m really looking forward to this interview, I think specifically Lee's experience on as COO and CFO, I think that will be quite revealing.

CIARAN RYAN: I think, Lee, if we could just kickoff and just describe the business of SilverBridge, you are listed on the Johannesburg Stock Exchange. What is it that you do? And exactly as Nicolaas says, you're occupying two fairly important posts there, both chief operating officer and financial director. Can you just start off and give us a bit of background there?

LEE KUYPER: Sure, maybe to start off with, SilverBridge and the business of SilverBridge,

we're a very specialised technology provider focusing on the financial services sector. The business is not a new business for a technology business, we've been around quite a long time, 25 years this year, and, we really look at three main pillars for financial services. The first one is around modernisation, so that, that really centres around the modernisation of core business applications, of which we have our own that we've developed here in South Africa. We take that to market and look to modernise the core business applications of specifically an insurance company. The second pillar is around digitalisation, so any business these days has to be looking at how the world of digital is affecting it and impacting their customers. So we, again, focus very much on financial services, insurance, as well as banking, and how we look to digitalise certain processes for them, both customer facing processes, as well as internal processes within their business. Then the last piece, which is a fairly new piece to our business, which is around intelligent automation. So really once you have a modern business and you've digitalised processes, the next kind of logical step is to then go into intelligent automation and that's around using things like artificial intelligence and machine learning, robotic process automation, and those sort of things to automate processes in an intelligent way. So in a nutshell, that's really what we do, and we do that for a number of customers in 16 countries across the African continent, ranging from fairly small niche providers in South Africa and other African countries, right through to some of the big corporate banks and insurance companies in South Africa.

CIARAN RYAN: Just and just describe your career path a bit, you're based in Pretoria, right, and where did you study and how did you end up where you are today?

LEE KUYPER:  I originally was born in Durban, but pretty much early on in my life my folks moved up to Pretoria and I basically grew up in Pretoria. I went to school in Pretoria, I went to the University of Pretoria, I studied accounting and did my degree and my honors at the University of Pretoria. Straight after that I joined PwC and I did my articles at PwC. In my final few months, pretty much my last six months or so of my articles, I was seconded on a fulltime basis to the Gautrain Management Agency, that was before the Gautrain was actually up and running. It was at the point where the contracts were being put in place and the whole systems and processes of the agency were being established. I was seconded there as the acting CFO on a fulltime basis and that really kind of opened my eyes up to a world outside of the very traditional auditing space, which I'd obviously then been working in during my articles. I decided for myself that I wouldn't go back into the auditing space. So when that secondment and contract came to an end, which was early in 2007, I then decided, well, I'll leave PwC and start looking at something more in the business space. I joined SilverBridge at that point, so I've been with the business now for 13 years. I initially joined as the commercial manager of the business, really looking at things like contracting and pricing and those sorts of things. After a year I moved into a role which was really an executive position in charge of new business development, which comprised both of sales to new customers, as well as commercial partnering. I did that role for about three years, then I  was appointed as CEO of one of the subsidiaries within the business, which is really the operational subsidiary, which did all the implementation and support work of the software that we develop. I did that for a number of years and then really for the last four years I have been in the role of group COO, which really spans across all the operations of the business from the product development through to the actual implementation, support and services side, but also includes things like our HR and office, and own internal IT department, as well as then in my role as CFO our full finance function and all the things that go with that being a listed company.

 

Think like an accountant and then move into a managerial role

 

NICOLAAS VAN WYK: That is so amazing. If I can come in here, Ciaran. As Lee was speaking, I just read through his LinkedIn profile and you make a quote here, “My role is to continually balance our strategic objectives with our operational imperatives.” That’s exactly what you described here, developing from auditor, sales, business development, CEO of the subsidiary, implementation, support, product development, HR, It, and that's really what we're seeing with the CFOs who we are interviewing, that journey from being just an accountant into this management strategic role. That led us to develop a designation after we saw the same development overseas, specifically for CFOs, it's called CFO (SA) based on some of the competencies that you've mentioned. For our listeners, just explain a bit more about that journey. How did you manage to think like an accountant and then move into this more managerial role?

LEE KUYPER:  I think probably the first big decision and step that I had to take was after that first year within SilverBridge, although I was commercial manager, it was still very much an accounting driven [position]. I was in the accounting department of the company and I reported to the CFO at that time. So it was still very much a finance driven role. But at that point, when I was offered the position to be the executive in charge of new business development, I really had to evaluate that from the perspective of do I go the traditional route of staying in finance, becoming a manager and potentially eventually becoming the CFO of the business or do I actually go into something completely different and move into sales. The way I really approached it was to think about what I wanted to do, not necessarily the job that I wanted to have the title that I wanted to have, but what are the things that I wanted to be able to experience and where does the value that I wanted to be able to add to a business, whether that be SilverBridge or some other business. So because of that, I made the decision to move into the sales role because I thought it would give me a broader experience and a new skill set, which I hadn't developed up until that point. I said to the CEO at that point that I'm happy to do it, but I'll only do it for three years and almost to the day I did it for three years and then from there moved into the next role. So I think for me being a CA and working in finance originally was always just the foundation, I always just saw that as a foundation. I think still today it's very much a foundation or maybe even a lens in terms of the way I look at the world. But a business is not just about the numbers, it's about the customers, it's about the people, it's about the processes, and all of those things together are really what result in the numbers. So for me, the way I got to this place where I am now was really by recognising that to be the most valuable within a business, you really need to expose yourself to as much as possible and do that by getting experience in different roles, and the applying that in whichever role you find yourself.

NICOLAAS VAN WYK: Such good advice. Ciaran, back to you.

CIARAN RYAN: I just wanted to touch on this role of the CFO and how that's evolved over the years, and I think one of the things that has really accelerated change in the whole finance space over the last few months has been this Covid pandemic and I don't know if you would agree with this, but even before the pandemic came along, we were seeing huge changes in what was expected and what was required of a CFO. He's no longer just an accountant, he is a business manager. How have you seen that role changing?

LEE KUYPER:  I think, as you say, it's not necessarily a Covid-related change, it's maybe been accelerated by Covid. So I think it's probably a combination of things that have happened that have caused the CFO role to evolve from just purely an accounting based role into more. I think it's what business needs and what business demands, but the world has also become a lot more about people and whether those people are the customers, people, or whether it's about the people who work within the business. I think the days of simply looking at an income statement or an expense report or whatever and using that to make decisions are kind of moving on. So I think if you want to be able to really effectively add value to a business as a CFO, you have to open yourself up to more than just the numbers. I think, as you say, as Covid has arisen, that's accelerated that reality because we no longer sit in the same office, we no longer can effectively or in many instances measure the way in which we did in the past. That really means that if you haven't devolved into a space where you can operate more at kind of a people process, customer level as well, that you're really going to struggle. I think that for me encapsulates what has driven the change in a CFO.

NICOLAAS VAN WYK: In terms of the IT parts that you just mentioned that should form part of this whole capabilities and competencies of the CFO, how did you incorporate that, did you go and study developing, did you do a special courses or was it just exposure? but I see also on the LinkedIn profile your interest is all in Microsoft and cloud and so forth. How do you bring in the IT section?

LEE KUYPER: So I think it's a combination of all of those things that you've mentioned. So whether you're a CFO or a CEO or any role really for that matter, I think continuous learning and development is a big part of what you need to be doing. I think that when you do that, you can do it through a number of ways. So I personally have learnt a lot about technology through the experience and exposure that I've had within the SilverBridge business, being a technology business. But I've also made sure that at least at a very fundamental level I have a good basic understanding of a lot of the language that technical people use and a lot of the ways in which technology affects business. I really did that through attending a number of online courses, attending conferences, and interacting with people that just know more than me. But I think for me technology is such a big part of any business, it really can't be ignored, irrespective of what your role is. So there's always value to be able to develop at least a basic understanding of how technology affects the business that you're in.

 

Lockdown has brought business digitalisation to the forefront

 

CIARAN RYAN: That leads into the question I wanted to ask you, has the lockdown affected your business? You've already talked about using artificial intelligence, artificial learning, automation I think was the word you used. Has this impacted your business in terms of revenue in any way, or has it, in fact, helped it?

LEE KUYPER: So SilverBridge is really in the business of modernisation, digitalisation and intelligent automation and although those things have always been pretty relevant to the financial services industry, I think what the lockdown has done is it's just made it even more relevant or even more imperative. So what we've seen is that prior to the lockdown, we were having already a lot of very constructive conversations or already customer engagements and projects around things like moving to the cloud or digitalising processes or including intelligent automation into your business.

But when lockdown hit, the shift really instead of us going out and trying to convince people that this was the way forward, people were coming to us and saying this is now no longer an option, our people are all sitting, working from all over the place, our customers can't walk into a branch or contact have a physical meeting with an agent or a broker. So we really saw a massive acceleration. in really what you can describe broadly as digitalisation in financial services. So for us at SilverBridge, it's definitely had a positive effect. We've seen really an acceleration of our strategy.

CIARAN RYAN: That's interesting, one of the things that becomes clear if I look at the type of countries and businesses that you are involved in, you're quite strong in Africa. Now, you’ve seen companies in different areas like retail pulling out of Africa and withdrawing back to the South African market. This is not your experience quite obviously, quite the opposite, you seem to be doing very well there.

LEE KUYPER: So we've been doing business in Africa really since day one but I think South African companies often struggle in countries outside of Africa because they tend to think of the market as South Africa and then Africa. So what we've experienced is, first of all, South Africa is in Africa. So we need to acknowledge that we are an African country and we’re Africans. So the minute we start to approach those markets as something outside of Africa, I think we're on the back foot. So we we've recognised that pretty early on. I think the other thing is that there isn't an approach, which is an African approach, each country in Africa is fundamentally different. Like South Africa is fundamentally different from those countries themselves. So it's important that when you expand into these different countries, that you really try to understand the culture, you really try to understand the market, and the most effective way to do that is to have partners on the ground, people that you've built up relationships with who can help you to understand those dynamics and then also help you to engage with the market. So at SilverBridge I think we've effectively done it by thinking in that way but definitely over the last while we have seen that a number of countries across the continent are taking a lot of strain economically, obviously, mixed in there is the whole political landscape, and that includes South Africa. But I think fortunately in South Africa we've got a lot of solid foundations when it comes to some of our key industries, like financial services, and that really means it's a safer place to do business of certain types. I think that's why you find a lot of people retracting back into the safety of South Africa, but we still very much see opportunity in the rest of the continent. We have more or less 50% of our customers sitting outside of South Africa in a number of other African countries.

CIARAN RYAN: Interesting. Nicolaas, did you want to jump in with something?
NICOLAAS VAN WYK: Again, I’m just impressed with the expansion into Africa, and the holistic nature of Lee’s CV. Tell us a little bit more about SilverBridge and your clients, do you focus on only the larger insurance houses or is it also bespoke for smaller, not brokerage firms but at what level of the supply chain do you support the financial planning industry?

LEE KUYPER: I think our sweet spot or the place where we can add the most value is more in that larger to enterprise customers, whether it be an insurance company or a bank, but we do have a number of customers that are more in a mid-tier, smaller type space, either because they just offer a very specific niche type of product or because they don't have the growth. We don't really play in that space of brokerages or financial advisors. I think something that happens often in our business, people often come to us with opportunities and they will say, well, you guys are working in this space and why not do this for brokers or why not do this for the medical sector or whatever. But I think for any business, it's important to really figure out what you're good at and then really grow from there. I think what we figured out is that we're exceptionally good at working in these typically complex industries, banking and insurance, in a space which is typically complex, which is technology, but really being able to marry these two things together and make it practically work. So the world, the world of IT projects, specifically in banks and insurance companies, is fraught with all sorts of risks, stories, and horror stories of how things have failed, and that's really because these projects are hard, they are full of risk and they are full of various dynamics and politics and all sorts of stuff. We've, we've figured out that we've got a specific competency in working specifically with the bigger companies in really taking these very valuable technological advances into a practical space of a bank and an insurance company. That's still applicable to a smaller company as well but I think relative to the amount of value that it brings is a lot less than when it's in a bigger space, a bigger company.

 

‘I think one has to look at development holistically’

 

NICOLAAS VAN WYK: And just sharing your learning and development needs, I'm sure as a CFO you’re very busy, always thinking about the business and improving it but how do you make sure you continuously stay up to date with new developments? Typically, at SAIBA we offer a range of CPD products and events for our members. But within the CFO role I’m sure your need for technical knowledge isn’t top of mind, is it more coaching and mentoring that a CFO would need? Do you still have time to attend courses, how do you stay up to date with various types of developments?

LEE KUYPER: There are so many areas of development and I think one has to look at development holistically. Yes, if you're a CFO there are certain technical aspects of your role that you have to be proficient in and you need to keep those up to date and I think there's lots of effective ways of doing that, whether it be through formal courses and qualifications that are offered, or whether it's just through self-learning. In today's world you can pretty much access most content for free and if you're diligent enough to be able to take that and figure it out and work with it and really navigate through what's applicable to you and what's not, you can go a long way. But I think it's important when you talk about development that you look at it holistically and also look to develop yourself in more than just what's required. So I think if you focus just on ticking the box and saying, well, I've completed my CPD hours and it can be filed away, I think you are missing the point. So it's important to look at the role that you're in. It's important to look at the industry that you're operating in, but it's also important to think about where that's headed and then try and figure out what are the skills that you need. Some of them you probably have, and others maybe you don't quite yet have. So that's how you should then go by putting that development plan together. I personally use a combination of attending some courses and conferences, but I do a lot of self-learning just using online content.

NICOLAAS VAN WYK: Just a follow up question on that, is there a CFO community and is there a need to for such a network of CFOs. Do you ever engage with your CFOs in the listed companies, is their time for this? There’s South Africa, there’s Africa, there’s international. We’ve seen a number of CFO clubs or communities start, SAIBA is also part of an international finance executive institute that tries to bring in and connect CFOs. But is there time for a community of CFOs and is there a need for like a voice of CFOs to express their particular needs, just your views on that?

LEE KUYPER: I personally don't belong to any, I belong to SAICA, but I don't belong to any kind of CFO community or forum. For me, I think if you talk about collaborating or discussions and creating a voice, I don't see necessarily the benefit of drawing a line or a box around a CFO role because of the things that we discussed, the CFO role needs to develop into more than just accounting and it needs to become a business role and it needs to look at business holistically. So because of that I think you need to be engaging with and having conversations with people who are not just CFOs. I think you you need to incorporate broad opinions from people who are, yes, also CFOs, but also people who are experts in the psychology of people. People who are experts in technical aspects of technology, people who are really good with working with customers and customer service, and those are not necessarily all CFOs. So I think if you limit yourself to a club of CFOs and try to grow your thinking within that space only, you're missing out on an opportunity to really broaden your way of thinking, and I think ultimately the value you can add.

NICOLAAS VAN WYK: That's a really good point, thanks for that. Back to you, Ciaran.

 

Young people becoming despondent about entering the accounting industry

 

CIARAN RYAN: I think we’ve got a couple of final questions here, Lee, thanks so much for coming on, but I wanted to ask you, first of all, very quickly, your opinion about the state of the accounting sector, given the number of scandals and so on that we read about, is it in a crisis or is it something that we're just going to have to live with, it's part of life these days?

LEE KUYPER: Look, I guess it is in a crisis in some way because I think the accounting sector within South Africa specifically has always been seen as something that has credibility and something that…it's the type of industry that you hope your kids can move into or you're proud of being part of. I think recently in the last few years that has really deteriorated substantially. I know of a number of people, young people who I've spoken to, they just say, well, they'd never even consider going into that industry just because of what they've seen has happened. So I think it is definitely an opportunity for the industry to look at itself very honestly, and very critically, and I think that is happening in many spaces. I think, however, one must also not lose sight of the fact that by adding more regulation and more compliance and stricter governance, you don't necessarily circumvent or prevent the things that have happened. So I think as a CFO of a business that prides itself in being ethical and really ensuring that we are transparent and open in our financial reporting, I get extremely frustrated by the amount of red tape and compliance that's laid on top of a business like ours, which is actually a fairly small business. Really in the interest of avoiding something like the big scandals that we've seen over the past few years, and I think it leaves you with a little bit of a disillusioned view of the value of these things. So I think it is important that we look at it and that we really evaluate what is really the purpose of having all of these things in place and are they there to add value to a business or to a shareholder or to an investor, or are they really there to say that, well,

we've checked that this is right and correct and ultimately if something goes wrong, it's not because we didn't do the right thing. So I think for me, the answer lies more in the form of we have to try and find a different way of getting the industry to correct itself, other than just putting more rules in place and more stricter governance and more layers of checking because I just don't think that's the answer. CIARAN RYAN: This is a point that's been brought up quite a few times with people, you get what they call the Laffer Curve effect, where Laffer was the guy who said the more you increase tax rates, the less taxes you’re going to collect. The same thing can apply to compliance as well, you load more rules on top and eventually you're going to just overburden businesses and you'll get less compliance. So I think that's a point well made. Quick question, are you optimistic about the future?

LEE KUYPER: I am, I think I'm generally an optimistic person, so I struggle to get into a space where I see the future as doom and gloom. But I do think there are a number of things at the moment, that we need to really as a society, as a country, and across the world, look at it and try and resolve because although I am always optimistic, I think the key lies in us really resolving the significant inequality that exists in South Africa and in many places across the world. These problems are real and they're there, and I think ignoring them doesn't mean that things will just remain the same. I think many people turn a blind eye to them because they're just so worried that the current status quo will be disrupted but I think it's important to face it head on and try and really work with it in a constructive way. Otherwise, inevitably the system will just correct itself in a way that's unpredictable and that could be detrimental. But I think there are a lot of signs for me within the political landscape within the country that showed me that that is possible. It's definitely not an easy road ahead, but I think at least we’re starting to see small little signs of light. I like to describe it instead of thinking about we're on our way up, I think in some ways maybe we’re still on our way down, but at least we're looking up and I think that's how I like to look at it, as sometimes things need to get a little bit worse before they get better. So generally I am optimistic and I think the world goes through these phases, and things like Covid are obviously pretty unique, not in terms of the history of man, but at least in certain generations they're unique, and that means everyone panics and thinks things will never go back to the same. Well, the reality is they never do go back to the same, they always change and it's just figuring out what that change means and how to really approach it in a positive and optimistic way.

CIARAN RYAN: Final question, any books you'd recommend?

LEE KUYPER: So I read a lot, I read quite a few different ranges of books, I mostly avoid business books. I try to read books from various topics that really broaden my world and my way of thinking. I recently read a book called Born to Run: A Hidden Tribe, Superathletes, and the Greatest Race the World Has Ever Seen by Christopher McDougall, it's about a largely unknown Mexican tribe who are considered the world's best long distance runners. So those types of books for me are just great at  opening your mind up and it might be quite weird to think that that's something that can help you in your career and in business but I think often when you read things like that, you realise really because it's about people and at the end of the day, we all work with people. What the key ingredients are to improving yourself or improving others. So that's something I read recently, which I really enjoyed.

CIARAN RYAN: Interesting, what an unusual choice of book. You talk about that, I was recently in contact with a South African who's based in Mexico, he was working in the corporate sector here, and I was trying to track him down and believe it or not, he ended up in a small village in Mexico with these long distance runners that you've just been talking about. He was a guy who was unhealthy, and he changed his lifestyle and his eating, and he started taking up running and now he's doing marathon running. It’s very unusual.

LEE KUYPER: That's a fascinating story.

CIARAN RYAN: I bet it is. Nicolaas, did you want to say anything?

NICOLAAS VAN WYK: No, I’m happy, thanks, no further questions.

CIARAN RYAN: Lee, I think we'll leave it at that but we’ve really enjoyed having you on and talking about some of these issues and getting your insights into the evolving role of the finance executive and the new competencies that are required. This is a very rapidly and dynamically changing thing.

NICOLAAS VAN WYK: I just came up with a question, sorry, now that you mentioned the competencies, Lee, what I just want to do is get Lee’s view on those 34 competencies that we developed at SAIBA for the CFO (SA) designation. We thought we linked it with this new role of the CFO but, Lee, if I can just share that with you, maybe you can just have a quick view and see if we’re on the right track.

LEE KUYPER: Sure, Happy to give you my view.

NICOLAAS VAN WYK: Thanks so much.

CIARAN RYAN: Great stuff, Lee, thanks for coming on. That was Lee Kuyper, who is the chief operating officer and financial director at SilverBridge Holdings, which is on the stock exchange. So Lee, thanks very much, we'll stay in touch, we'll get you back on again.

LEE KUYPER: Thanks very much Ciaran and Nicolaas, it was good to chat to you.

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