Finance Leadership Strategies for Niche Markets with Scott Page, CFO of Precision Aviation Group

Speaker A: Foreign.

Speaker B: Scott, thanks for joining me today.

Speaker A: Thanks for having me.

Speaker B: Yeah man. You uh, know the first question I have is you've had a pretty illustrious career, uh pretty deep. You're currently the CFO of Precision uh group. Can you tell us how you got there, a little bit about your career path?

Speaker A: Sure. Um, you know I'll go at a high level and then we can drill in if you want. But um, you know actually in undergrad um was actually in a pre law program and my junior year you could take some electives and kind of randomly I took a finance class and just fell in love with it and ended uh up getting ah a dual degree both in political science and in finance. Um, I was at Michigan State. I had the opportunity to do an internship at GE which you know is, was really good and then start working there in their entry level training programs and you know um, GE did a really good job about um giving people broad exposure to different businesses and a lot of good training. Um, so I spent the first uh 12, around 12 years of my career at uh GE. It was an internal auditor for two years. Um had a core FP and a role um then actually spent. GE was big enough where they actually had their own internal M and A finance team. Yeah so I spent a number of years um being the finance person supporting some of their M and A initiatives which is neat really. Um, interesting and kind of fulfilled. Started kind of a lifetime love of M and A and transactions which I think has benefited me uh later on in my career. Um after that I went to um, HD Supply which was private equity owned at the time and was there when they um, was lucky enough to be there when they did their um ipo. So so got to observe that process. Um and then really after that had a number of roles both in public and private companies. Um uh FP and A roles and going into um a VP of Finance role. Um so this Precision Aviation is my third ah CFO role. Um my prior role at um Heritage Distribution was a really great experience. Um, it was a roll up strategy in the H VAC distribution space. So it was a really interesting ride when I joined the business. Um, the PE firm had just acquired their first um business which is actually based in Alabama. And um, it was around 170 million of revenue and about 25 of EBITDA. Uh over the next um 10 months we essentially grew the business to um, uh over 600 million of revenue and close to 80 of EBITDA. So really kind of really grew the business and was uh actually um, the PE firm decided to market the business and uh, we actually ended up selling it to, to a company, um, based in Sweden.

Speaker B: Oh, okay. I spent some time in Sweden. Did you get to go?

Speaker A: Yeah, I went once. Oh, nice. They're in Malmo, which is right across from, um, from Denmark.

Speaker B: Okay. Yeah, yeah.

Speaker A: Flew into Copenhagen and got to spend some time with the team there. Um, so it was a really great experience.

Speaker B: Nice.

Speaker A: I joined Precision Aviation in June. Um, they're in the aircraft, the aviation MRO space. Um, again it's a business, um, that's always been in Atlanta. Um, David Massey, owner, has been with it since it was like a million dollar business. And now, um, it's $600 million plus and um, over 100 million of EBITDA. Ah. So really, um, enjoy the team. You're learning a lot about the uh, aircraft, uh, MRO space. This is a pretty interesting business model and just really kind of working on the team to help uh, grow the business going forward.

Speaker B: That's awesome. Um, and a lot of questions come to my head and kind of sprout off of that journey, uh, that you just outlayed. So I'm just going to start running through them and hit them. The first thing I guess that comes to mind is it seems like it's a pretty technical field and also kind of a niche field that you're in. Is there anything specific skill, technicality that you look or technical ability that you look for in the people you hire to your team?

Speaker A: Yeah, you know, I was really lucky to inherit a pretty good team and we're also building the team out as we grow. Yeah. Um, the one interesting thing about me is I've, across my career I've been in a variety of different fields.

Speaker B: Sure.

Speaker A: Done everything from uh, you know, core manufacturing businesses to financial services to um, digital advertising to uh, you know, so I think, you know, the pure distribution like HD supply and heritage. Um, you know, so what I've found is, you know, in going to different businesses, you know, obviously each one has their own things that are very unique to the business. But I think there are things that are just universal, especially from a finance perspective, about revenue and serving customers and being smart about how you source your inputs to um, provide those services and maximize profit and manage FBNA and SGNA and a support base to help the team enable, um, the revenue and grow. So I think from being in different businesses, I think there's a lot of things that are kind of universal.

Speaker B: Yeah.

Speaker A: So I think, you know, in, in this business, um, you know, really the first thing is just kind of getting back to those universal themes around controllership and um, you know, being a partner of the business and kind of, you know, helping finance, um, establish a vision for how you can support, support the business. You know, there are some, some things to your point that are um, technical in, in the model, um, for precision aviation. You know, one of the things in the aircraft space is um, they have what are called cores. Essentially you can um, on an airplane, you know, we can take back a used piece of equipment, we'll refurbish it in our site, um, give them a new one, kind of a refurbished one off the shelf. Sure. And there's regulations around how many hours those things can fly in the maintenance schedules. Uh, but then we'll take back that core, refurb it. So we've got this kind of core

Speaker B: exchange model, um, kind of a self replenishing inventory.

Speaker A: Yeah. Um, so I think that's the one piece that's relatively, I think also in some um, automotive spaces they have something similar. But that is the one thing that's relatively unique to the aircraft MRO space that I haven't experienced before. Yeah.

Speaker B: And I guess it's probably kind of hard to find people with that specific experience. So you kind of find the people with those universal skills and then coach them up on what you need to. That's specific to that technicality.

Speaker A: Yep, exactly. And um, luckily there's been um, some people on the team that are pretty long tenured. So right now we've got a good mix of um, people that are relatively new to the team. Kind of bring some outside perspective having worked there, and then some people who have, have pretty deep expertise in the business that kind of help teach the new people and provide that connectivity that we're kind of really understand the granular details of what's going on on a day to day basis.

Speaker B: That's awesome. Um, and you also talked about, you mentioned your CEO for a moment and you've been a CFO at three different places now. How important do you feel like that relationship is with the CEO and how do you foster that to really be a value add partner to the CEO and not just come across as maybe a tattletale or a report card provider or something like that?

Speaker A: Yeah, no, I mean, I think the establishing uh, a good relationship with the CEO is key. Um, you know, one, just for the broader organization to make sure, you know, to demonstrate alignment to usually what I've found in a lot of these businesses there's so many different things that you could potentially do and avenues to go. And the more I get on my career, the more I kind of appreciate instead of trying to do 20 things 5% of the way, and it's really kind of picking out those three or four things that you really kind of drive to completion. So I think, you know, getting alignment on what are the biggest priorities for the business and what are the, you know, the things that we really, you know, really need to focus on. Um, I think having that alignment is key.

Speaker B: Yeah. Is that, you know, when you got to the CFO position kind of top of the hill for the finance and accounting world, were there certain views or new, uh, ways of looking at things that you learned from working hand in hand with the CEOs that they looked at that you didn't consider before or really revelations along the way, big or small?

Speaker A: Yeah, well, I think coming into different industries, my first role is a manufacturing, then distribution, um, space, I think kind of understanding the nuances of the business model and thinking about strategically the dynamics of the industry. I think that's where the CEOs are usually very attuned. And coming into a business from, from the outside, it's really key to understand those nuances. And one, how your business operates with customers and then how it also kind of operates in the broader context, uh, with competitors. Uh, I think having an appreciation for that just will give you some perspective as you go through the day to day.

Speaker B: That's great. Um, and back to your journey as a CFO and getting to that point, you know, what do you think? I, uh, feel like it's something I've really wanted to ask and I haven't asked that many people. What do you think got you and what was that turning point of you getting that first CFO position? Was it just a buildup of experience? Experience and making yourself more valuable and then you finally got the shot, or do you feel like there were some certain things you checked that really gave you that shot in the end?

Speaker A: Yeah, it's a good question. Um, I mean, you know, a couple things about my background is, you know, I think now looking back at the, the span of my career, I've been able to have a lot of kind of well rounded experiences. But, you know, my, my path hasn't been the most linear. Uh, sure. And I kind of weaved around a little bit, got a lot of experiences and I think they've added up to a skill set. Um, so, for example, spending some time just doing. Because I think a lot of people have more traditional career, maybe they'll spend three or four years in public account and a controller role and work their way.

Speaker B: If I just know every debit and credit, I'll get there.

Speaker A: Um, and you know, for me, I started off kind of on the FP and A side. Um, and one of the things that I've always been interested is lifetime learning. So it started off, um, I got my MBA part time while I was working.

Speaker B: Um, I did the same.

Speaker A: Then got my um, cfa.

Speaker B: Highly impressive. That's a tough thing to do.

Speaker A: Yeah. Because at that time I was kind of thinking I was working at GE Capital and interested in private equity. I knew that was a, you know, a mark there. Then, um, you know, relocated down to Atlanta, um, and actually had a role, um, that was more like a strategy role or um, internal consulting role, which, you know, was actually pretty interesting because we would go into businesses that were underperforming and kind of do some analysis around like Salesforce effectiveness and everything.

Speaker B: Sure.

Speaker A: Um, so I think one of those things, you know, what that gave me, um, some of the M and A and some of those roles is going into situations where I knew, um, little to nothing, kind of coming in and then being able to kind of dig into the data, dig into, meet people and kind of get up to speed pretty quickly. Um, and then, um, had gone through a series of FP and A roles. Then when I was at Chart Industries, had the opportunity to go into a line. My first one being kind of in a line, uh, financial leadership. And then at the time I actually realized one of the things about my skill set is that kind of core accounting, um, I could obviously file but wasn't, you know, didn't have a very good mastery of it. Sure. So, you know, kind of, you know, relatively late in my career I went back, um, got my master's in accounting and then sat for the, the CPA exam.

Speaker B: Sure.

Speaker A: Um, you know, so, you know, so as I think kind of, you know, think back, there are times in my career where I almost thought I was kind of at a dead end or I was going to kind of get pigeonholed. And I think, you know, just kind of kept, um, you know, kept learning and evolving. Evolving. Yeah. Uh, you know, so now I think, you know, I've got kind of a broader skill set to sure. To call on.

Speaker B: Yeah. I think that to be learned from your path is just don't be afraid to go the non traditional route and take opportunities as they come. I think that's really impressive. And then the life learning, never stop learning. Get your CPA later if you need to get your CFA along the way. I think those are, um. That's a great story and I think a great lesson. I think a lot of accountants get stuck just if I master everything about accounting, it'll come, you know, and I think there's more of a journey that CEOs and people looking for CFOs value that sometimes it keyed in on. Um, so that's great.

Speaker A: Uh, yeah, I think balancing the tactical and the strategic. And what I've kind of really appreciate is the marriage of the two because I think you can't, you know, I think if you try to be strategic without really kind of understanding how the, the sausage is made, you could start going to wrong conclusions. And if you're just, you know, kind of making the sausage without kind of really thinking about, you know, how what the goal, overall goals or strategy of the business are, you know, that doesn't work either. So I think it's kind of, you know, the, the people I've, you know, been most impressed with in my career, the ones that can see, you know, play, utilize both skill sets.

Speaker B: Sure. That's awesome. Um, into that, that kind of this whole journey and everything involved in it. You know, you talked a lot about working in both public and private, uh, industries. Whether it's private, ah, equity or a public company. Can you contrast the competing, uh, demands and the ones that maybe one had and the other didn't and what that was like working in those two different companies? And you even talked about going through IPOs. I'd be really curious about that.

Speaker A: Yeah. Um, well, yeah, I would say both, both are challenging. Um, yeah. And I think, ah, you know, on the public side, um, it's obviously that cadence of every, every quarter having to do your, you know, Qs and your K's. And there's obviously a little, probably a little bit more, you know, rigorous around, you know, just being an SEC registrant to. Sure. To make sure that, you know, you've got the robust processes in place. So I think that, um, has its own set of. Own set of challenges. Sure. On the PE side, you know, I think a lot of stuff is kind of focused on capital structure and, and managing liquidity. Um, and you know, kind of thinking about, you know, positioning the business for ah, um, a liquidity event. Um, but then, you know, the, the one benefit is sometimes, you know, just from a reporting or strategy standpoint, you have a little bit more leeway where.

Speaker B: Sure.

Speaker A: Yeah. You know, kind of take some time and be a little bit More strategic versus having to um, you know obviously reporting in a public company everything has

Speaker B: to be a sort for a bank

Speaker A: it is just buttoned up by the end of the quarter. So you can kind of pick and choose and have a little bit more flexibility in the private side.

Speaker B: Um, am I hearing that maybe you prefer the private side or is there just because of the flexibility of the business and ability to kind of move how it wants and when it wants?

Speaker A: Yeah, I mean you know the other, you know, now that we're talking, the other interesting thing about me or you know as I've evolved is um, I started off at ge obviously like a multi, yeah, you know, multi billion dollar M publicly traded company and then you know went to some companies that were also kind of multi billions. I think over time you know I've worked more and more in kind of mid market. So sure, 200 to eight um, hundred or $900 million businesses. And to me I think that's the sweet spot that I found that I most enjoy. The reason being I think, I think in a bigger company, like a multi billion dollar company, to me it's hard to really truly get your head around everything that's going on on a day to day basis. Yeah, you know, really have um, understand the teams and the dynamics. Um, and if you're in a really small business then I think the CFO role becomes more of a controller type role.

Speaker B: Sure.

Speaker A: So you know I think in that kind of mid market space to me is where I really enjoy where it's big enough where you're able to have a team, um, you have some resources to really kind of strategize and implement good processes. Um, it's small enough where you're able to meet the uh, understand the truly understand the day to day um, in the business and have good relationships with the team, the entire team. So yeah, that's kind of my sweet spot that I like to kind of stay operate in.

Speaker B: I agree. For me personally I've worked at some major corporations and I worked at kind of the mid level uh, as well and even some smaller mom and pops. And I really like the mid level because they're being aggressive kind of like you said in the market, trying to grow. But you as a finance accounting professional analyst, there's enough space where you can be nimble and move and do a lot of different things. And I always found that really interesting in uh, those spaces as well. Uh, I want to touch on, you

Speaker A: know that also um, is a good point in terms of um, you know, one of the things that we've done a lot is you know, acquired family owned companies which is you know great because they're usually well run, a lot of pride of ownership um, but a lot of times they're coming from the one nice thing about starting with a G is you get to see bigger corporations, you get to see kind of robust scalable processes and um, best in class um, I think going into companies that had more flexibility when they're family run and in private and kind of taking some of those things that are um, what we consider kind of blocking and tackling in a bigger business and kind of implementing them in ah, a smaller environment I found usually yields a lot of benefit to the business and overall to the team in terms of simplifying processes, getting good data and reporting.

Speaker B: Yeah. And transitioning from that directly into. You have gone through a lot of acquisition it seems. I read about two you did recently I uh, think at Precision one with the company and I think North Carolina, um, and some others. So what technologies are really helping you through that and how do you kind of align that with operations? Um, Shameless Plug. I know Planful is helping you along that journey but I'd love to hear about that.

Speaker A: Yeah. So we're um, utilizing um, Planful for our uh, financial uh consolidation and reporting and um, excited to be at a planful event and kind of think about the next steps in our journey with utilizing um, the software.

Speaker B: Sure.

Speaker A: Um, yeah, I think the quality of the ERPs and how the businesses use it I think is always one of the biggest um, biggest challenges. And um, it's always interesting when you hear a lot about AI and a lot of these bigger things and um, to me I think. But then you actually go into a lot of businesses and the level of sophistication and manual processes, especially mom and pops. Um, so I think um, you know that's one of the things is just thinking about how to leverage systems and leverage data. So I think we're really thinking about how to that kind of blocking and tackling. Sure. Because those are the kind of core building blocks and foundations of reporting and controllership because you can ingest all that data into a system but if there's not a lot of consistency and quality uh, around the underlying data then putting into a system that's going to process it faster isn't going to um, yield very good results.

Speaker B: Sure. Um, no matter how you do it. You touched on a topic everyone's talking about is on everyone's mind with AI, uh, how are you approaching that Are you all integrating it all in precision in finance? And maybe not just in finance, but other areas of the business as well?

Speaker A: Yeah, um, uh, to be honest, we started to use a little bit of um, integration processes, um, to start to leverage um, AI in terms of um, when we acquired a new business to kind of look at their capabilities and their um, sales and usage of inventory and understand where there's, there's overlap. Mhm. Um and synergies between the business. So we've started to use it, but I think we're pretty early on in the journey.

Speaker B: Do you have a hesitancy about it at all or are you just being cautious, cautiously, you know, uh, responsible? Do you have a desire to adopt it?

Speaker A: Oh yeah, definitely. I mean I think the, you know, the tools and using cutting edge tools are um, they definitely can be really, really helpful. Sure. You know, but also I think, you know, again for us, I think the biggest bang for the buck is just you know, kind of basic blocking and tacking and making sure we've got um, you know, good underlying processes and reporting.

Speaker B: Yeah, absolutely. And just to wrap up, you know, I know you said the blocking and tackling is huge. Making sure you have good standard systems in place to do that. Um, but how is these emerging technologies, AI or not? AI is definitely the one on the forefront. How do you balance the need to make sure that you're ensuring responsible use and security of them, but also making sure you're not getting left behind with these technologies? Is there any practice or method you like to make sure of that you're practicing to achieve that?

Speaker A: Yeah. Well, I think to me the key is um, bringing yourself and the team along kind of a journey in terms of um, freeing up capacity from doing rote manual tasks. And I think as you improve underlying processes then it gives you ability to take a step back, you know, be more analytical and kind of execute. Um, you know, one of the things that I've found in some roles, I call it kind of a positive flywheel in the sense of, you know, gone into some businesses where there's a lot of manual processes, um, or inefficient processes. Sure. What you do is you go in, um, and free up, um, you go through, target some of those processes, improve them. So let's say, you know, in the first three months you improve a couple processes. That frees up, you know, three days of capacity.

Speaker B: Sure.

Speaker A: For a controller or a staff accountant. Then what they can do is, you know, that next month they can take those three extra days of capacity to work on some additional projects. Yeah, that might add, you know, it might free up another, you know, half a day or day and then you know, the next month, you know, you'd have four days of capacity. And what I found is, you know, you start to build in this thing where you start to uh. And I think when people see the benefits of process improvement, um, becomes a motivating factor and it starts to get them thinking about how else can they be more efficient. I think as you start to get those things that are more efficient then you free up um, capacity and also mind space instead of just doing more rote tasks to really think about the um, you know, the, the higher level controllership. So sure, to me I think that that's the benefit is if you can use more automated processes to do um, automate a lot of, you know, more mundane tasks that yeah, frees up capacity for your um, business team to really kind of think about, identify outliers and address underlying problems and the business.

Speaker B: Yeah, adding a lot of as much value out as I can.

Speaker A: Exactly.

Speaker B: Yeah. And that brings me to uh, you know, we're reaching the end but brings me to what I think is going to exhibit your whole, I'm going to call it your whole holistic view. But you talked about uh, you know, being a business partner and finding a way to do that. And do you find that that feeds into that belief you have. If you can make those processes more efficient then it gives you more time to do those value add to be a business partner. And can you explain why you believe that's so important for finance and accounting to achieve rather than just being number checkers and reporters and maybe tattle tellers?

Speaker A: Yeah, um, well one, I think um, finance ideally kind of provides, ah. I mean there's one thing just to provide numbers on a spreadsheet at the end of the month. You know, two to me is really, you know, what are the granular insights or what, you know, what are the business insights that you can derive from that. So usually when I'm trying to do ad hoc analysis I'm always kind of thinking about what are the, you know, not just to, to get something I can put on the page but you know, what are the operational things that we can, that we can tease out? Yeah, two, I just really like that um, partnership. A lot of the businesses I've been at, uh, I've been in some true kind of headquarters locations. But as much as I can, I like to also be in the offices that have operations there just so you can kind of See the work being done because I think obviously one of the risks for being in finance is just to kind of sit at a desk, look at everything and you know, as a number in a cell and an Excel spreadsheet.

Speaker B: Sure.

Speaker A: Where, you know, if you kind of really understand that there are people and processes and things going on that actually you underlie those, that data and I think getting appreciation for that and kind of really, you know, digging into the details again, kind of getting back to why I like the mid market companies is, um, yeah, I'm actually able to dig into things, whether it's profitability or generating working capital and actually be able to really kind of dig in and find those drivers that will, and work with the teams to uh, identify things that levers that will actually move the needle for the business.

Speaker B: Yeah. And that's not just it helps the business, but it also promotes your department into a higher light, which I think is really great and adds more opportunity to what you can have and what you can do as a department. So, um, yeah, that's awesome to hear it kind of come full circle and how you explain it. Uh, so final question, uh, and really appreciate the time today.

Speaker A: Yeah, thanks for having me.

Speaker B: Yeah, absolutely. Uh, but just final words of advice to that, you know, analyst, director of finance, controller, maybe staff accountant that wants to be where you are one day. Is there any advice beyond just knowing all the technical ability they can. Is there any advice or knowledge you, you wish, uh, to pass on to them or you wish you would have known at the earlier stage in your career?

Speaker A: Yeah, I would say, um, to be patient, be focused on the long term, you know, be invested in lifetime learning Again. I had points in my career where I thought I was kind of hitting a, you know, hitting a roadblock, but you know, was always, you know, persistent and um, a lot of things that, um, you know, roles that um, seemed like challenges at the time. But you know, I think looking back, you know, provide these specific skill sets that uh, you know, really, really helped out. So, um, yeah. And you know, I think, you know, just, you know, be willing to challenge yourself and um, you'll be open to new opportunities.

Speaker B: Yeah, don't, don't be afraid to go out of your comfort zone. Yeah, exactly, Scott, I appreciate it and this is great. Yeah, thank you man. Thank you very much.