127: How Great CFOs Create Value Beyond the Numbers with Brad Collins

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What does it take to be a truly strategic CFO in today’s construction industry? In this episode, Steve sits down with Brad Collins, CFO of Barrett Industries—a regional construction leader and part of global infrastructure giant Colas. 

They dive deep into how finance leaders can drive real business value beyond spreadsheets, why strategic alignment across teams matters, and what CFOs can do to shift from being number crunchers to strategic partners. Brad shares insights on regional autonomy, KPI execution, operational efficiency, and the true ROI of financial leadership—plus, what he wishes he knew five years ago. If you're building a finance team or leading a P&L, this one’s packed with practical, hard-won advice. 

Disclaimer:
The views expressed here are those of the individual Coltivar Group, LLC (“Coltivar”) personnel quoted and are not the views of Coltivar or its affiliates. Certain information contained in here has been obtained from third-party sources. While taken from sources believed to be reliable, Coltivar has not independently verified such information and makes no representations about the enduring accuracy of the information or its appropriateness for a given situation.

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Transcript

At the end of the day, you have to understand the customer, what drives their decision-making and what would make them want to come back. That is key to actually figuring out how you can serve them better.

Today I have Brad Collins, the CFO of Barrett Industries on the show. And I want to kick things off with my first question.

Brad, there's so many distractions. There's so much noise out there in the world. And as a CFO, you have so many things that you're trying to juggle in your own company. How do you stay focused on the most important value-adding activities?

Yeah, it's a good question. I mean, first thing I do is at the end of every day, the beginning of every day, I do like a little 10-minute reflection and kind of, sometimes I write it down and say, okay, well, here are the really things I need to focus on here. So I got important meetings. I know I need meeting prep. I know these are the things that I wanted to do yesterday, but I didn't do yesterday. So I've got to do them today. These are things that if I have time, maybe I can work into my schedule.

Because what I find is the busier the world is, the more things creep up on you and you get to a point like, oh my God, we have this meeting coming up and geez, I haven't done as much prep as I need to. And as soon as that happens, once it's a slippery slope all the way down. So I mean, I try to do a little reflection, but clarity in the mission is always really important to me. Meaning I always want to know what the company is working on, what we're doing, really understanding the business and staying grounded kind of in strategic objectives of the company.

Because if I know that I can do that and I know what we're trying to do, my brain automatically might go to certain places, if that makes sense. So I can say, well, I know we're trying to do this in the construction industry or the hot mix asphalt or something. And if I really understand the strategic objectives of the company, it does help reframe my mind into saying, let's say I want to do some training. Well, let's do some training around this or that or around cash collection as relates to specific items.

Yeah. And that makes sense. So let's talk about Barrett and provide the listeners with a little bit more context. So Barrett has this regional footprint, but also it's a part of a much bigger organization. Maybe you can explain the structure of the company and how Barrett fits into the bigger picture of Koloss.

Yeah. I mean, it's a unique industry and company. So we're ultimately the Barrett's heavy highway contractor and construction materials supplier up in the Northeast. And we have regions in Ohio and New York and Pennsylvania. Ultimately we're owned by a parent company, Koloss, who's in 50 plus countries and has a huge footprint around the world. But construction as a business is what I think would call an island business.

And the paving form is sometimes king of that island, right? And then the construction manager might be king of that island from a construction standpoint. And then you get ultimately to a region and those people are making strategic decisions every day in the region, not to say without guidance, but they're the experts in the regions and what they do. So they have to be able to work autonomously kind of with their leadership teams to make decisions, ultimately rolling up into Barrett Industries, which is the parent company.

But it is a unique business because you do have these large entities in certain big cities doing a huge infrastructure projects and they make decisions every day strategically. And especially kind of, like I said, making sure they understand the strategic objectives. We all want to be going down the same river and we might not all be in the same boat all the time, but we want to be going in the same direction and people can't veer off or we're full steam ahead.

We just go about it differently because markets are different and sometimes competition is different and what works in one market doesn't work in another. We have strong dominant market positions in some places, a little bit more weaker positions in other places, or that is to say less strong positions and you can't paint everybody with the same brush. So from a strategic perspective, it's an amazing place and company and style of business to work in.

Yeah. So let's dissect that a little bit further because you know, we've talked strategy, we've worked on strategy together and there's this idea of like a strategic problem and kind of what you're saying is, you know, each of these regions, they're nuanced, right? They have their own geographical issues or conditions or circumstances or whatever it may be. And so every business, you can't just come in and slap a corporate strategy on them and say, okay, these are the strategic objectives for everybody because it's like maybe one plant is dealing with outdated infrastructure and equipment and they're having operational challenges that are different. And maybe in another area, competition is increasing and they're starting to feel this competitive pressure. Whereas another location, they don't have competitive pressure at all because they're the big dog, right? In a small market.

So how do you think through that when it comes to like your business and like as you're the CFO and you're keep everything working well and resources allocated correctly and whatnot. How do you think through that from like a strategic and financial perspective?

Yeah. So trying to, and listen, being the CFO, sometimes you got to wear the corporate black hat and there's certain things that when you come in are uniform in every region. You know, we talk about credit and things like credit decisions and things like that. I mean, those are some things that are non-negotiables, but when you go into a company or a market or something, trying to get people to understand that it's not just about financial goals, right? And we have financial goals and metrics and targets that we need to hit, but the true understanding is, you know, how you create value for your customers, how you create value for your employees, how you create value for the shareholders overseas, but those are all different, right?

And so you could have a great financial gain, a great contract that you won, but maybe it's not great for cashflow purposes, right? And so those are sort of opposite forces. We certainly want both of those. We want good financial performance. We also want good cash performance, right? And that's what we're judged on every day by the market and by our internal leadership teams and things like that.

So the challenge is, like you said, it's very nuanced. I can go in and understand and look at the market and put some financial objectives. And let's say I just blanket said like, Hey, we want to grow 1% EBITDA or we want a certain target. We want to hit return on capital employed, all these other things. They can go about it a different way than another region. And they have some flexibility to say, okay, well in our region, the thing we're going to do is increase our transfer price internally and increase, you know, maybe the price to the market or something like that.

Other places it's about operational efficiency and we're maxed out in kind of where our competitive landscape is. And we don't really want to raise price and upset the market a little bit. So we're going to have to do from a more operational efficiency standpoint, but setting targets in sort of letting people interpret them and focus where they need to, and then offering support as necessary.

Right? I mean, like I said, understanding the business is the big part of it, because if I go in and throw out some goals and stuff that I want them to hit in there, the lofty, or if I say, Hey, I want a 12% EBITDA or something, and it's in a market where that just can't happen based on certain things, you get to a point where you lose a little credibility because it's like, okay, sure. Fine. That'll be my goal. That's great. You know? And they maybe don't — not to say don't try as hard — but it's a little bit of the grain of salt because they know they feel in their soul that they can't hit the goal.

Absolutely. And so, I mean, I had that experience when I was working at Ernst & Young, one of my big clients, they're a multinational multi-billion dollar company. And I remember like the CEO and the executive team, they'd come up with these goals, right? These strategic goals and objectives, whatever you want to call them. And they would say, okay, we want to grow by X percent. We want this bottom line, et cetera. Right.

And then they'd go to the finance team and say, okay, this is our strategy, essentially like modeled out. And then the finance team would just do the plug, you know, like the typical plug, the classical plug where it's like, okay, here's our revenue. All right. To do that. And if we want a bottom line of 12%, then I just got to adjust costs. And you're like, oh, there it is. We hit our profit goal and our cashflow goal.

Talk a little bit about that because do you see that happening in your company? How do you overcome that? So then strategy isn't one thing over here. And then like the financial forecasting side of your business is another thing over here.

Yeah. So, you know, we're mostly operating in the Northeast, at least in Barrett. So, we have the benefit, a little bit of seasonality where, you know, in January, February, we're not doing much construction, as you can imagine, because, you know, the road's got to be basically 50 degrees and warming for us to do any work. And if you know anything about the Northeast, it's not, doesn't get that way until much, much later in the year.

So, we do have that period where we can sit back and do some financial forecasting and planning and cashflow modeling and things like that. So, it's a nice time for us to get a little strategic reset because we have all these objectives. We try to look all the time at what our strategic focus is. And then having that kind of time at the end of the year to say, yeah, did we achieve our strategic goals?

If yes, why and what made us successful? Can we replicate that, repeat it? Can we take it from one region and give it to another region? Can we educate people on what we did in the process?

And if we didn't, why not? And sometimes it has nothing to do with how hard we worked or whether we were going to be successful at some of the micro goals that we set. It could just be funding related. It could be, you know, we had a big job that was pulled for funding or things like that. And you have to, when we don't meet our goals, you can't necessarily always say like, well, yeah, this year was a failure for that reason. Sometimes you need a little setback to realize what made you strong, you know?

Yeah, absolutely. So, let's talk about one of your internal advantages where you have this like SWAT team, right? And you can, you could describe this to the listeners where basically you have this specialized team that will come into different locations and they'll, they'll know from an operational standpoint, okay, we, this is exactly like what we're going to optimize.

And we've talked about that where it's like, okay, if you move this pile over here, like 10 feet to the North, then it's going to save you blah, blah, blah hours. And this much is going to improve your bottom line.

Talk a little bit about that. And also tie in this idea of do companies really need strategy or is it more just like, okay, we just need to get operations in check. And that's our strategy. Because I think some people out there, they think, I don't need a strategy. I just need to get work, do work, get work, do work. And if I'm doing the blocking and tackling, I don't need to be thinking about all these objectives. And I just need to go there and be efficient with my operations. Talk a little bit about that and your thoughts on that whole philosophy.

Well, when you think about that, I mean, think about your example. I mean, that is strategy, right? So even if people are just going out there and they've got to get done, get work, do work, get work, that kind of thing. I mean, the idea that you could produce on time, quality material, efficiently, safely, all those things. I mean, that is a strategy, right?

I mean, it may not be this overarching big strategy with numbers and a lot of metrics and things like that, but that is a strategy. And sometimes a simple strategy works. I mean, sometimes if you can go somewhere and say, hey, here's what we're trying to do today. We're trying to get rocks out the door. We take big rocks and make them into little ones. And we try to put them in trucks and get them out the door. Inherently in that is quality, safety, accountability, all these things that sort of make the team understand and focus.

But we do have internally, there are some people that are experts in their field, harnessing the experts and to say, it does take some time because not everybody is exactly receptive to somebody coming in and telling them how to run their asphalt plant or quarry or construction crew, especially if they've been there for a number of years. It's not, sometimes it's challenging, but you go in and say, this is the best of the best, right?

They're going to look at your entire facility. They're going to say, hey, it would be better if you move this conveyor over here, you move this pile over here. It's going to save you this much time while you're making this product. There's a by-product of that, what you could do with that by-product is maybe blend it with this other product so that you don't have to make as much.

And there's a lot of different aspects of it, but you have to go at it lightly because it's sometimes, it'd be like if somebody came in your house and tried to tell you how to do your own chores, it's like, yeah, well, I live here, so I'll figure it out myself. I appreciate it though. But sometimes you just got to get people to sit back and say, they're here to help.

And if at the end of the day, you have a better way to do it, that's great. Let's prove that there's a better way to do it and then let's go do it that way. But we owe it to these people and to the company and to shareholders and all that to listen.

Absolutely. Let's talk about your team because you run a really good team. I think you're an excellent leader, but you also have the advantage of people who have been around at Barrett for a long time. You have a lot of tenure at different levels.

So from an accounting perspective and like FinOps, what do you do to upskill your team to help them to think beyond just the numbers, right? Because I know like when I was CFO, I had 40 people in my FinOps department and sometimes they get so lost in like a whip rapport or they're trying to track down some numbers and I'm like, wow, like we're missing the bigger picture over here. What do you do to keep your team focused on like the highest value activities as well?

So, I mean, one of the main things we preach all the time is that, you know, once you get to a certain level and I'd say, you know, really controller, even assistant controller and up, I mean, you have to be a strategic business partner in the business and you have to have a seat at the table.

And what I try to tell is think of it as you would rather be consulted than informed, right? You want management and operations to come up to you and say, hey, I'm thinking of doing this. What do you think of that? You know, are there any other, are there any things I'm missing? Are there any gaps in my logic instead of saying, oh, hey, by the way, I talked to so-and-so today, we think we're going to go into this new market segment or try to bid on this extra work. You know, you want to be consulted, not informed.

But that's different for certain people. It's something, it may be easier for some and more difficult for others. And a lion doesn't always have to roar. I think that's a book. And I mean, it's not everybody has to be an outspoken leader. Some people are quiet, but they lead by example or things of that nature.

So understanding that not everybody has to be kind of the same cookie cutter, this is how I want my financial leaders to be and given some freedom for people to kind of do their own thing and be their own person.

And I think part of it too, you know, we have this regional structure where I might have a region in one city and a region in another city. And they are, again, the controller is the highest level of finance usually in those regions, but they're like the CFO of the region. I mean, they're making decisions every single day that impact the financials of the business, and they're doing it inside their leadership teams, really.

So helping at that level, drill down the point of you need to be in all the strategy meetings, you have to have input, you have to have a voice, and we train it throughout operations also. I think a lot of times finance, you know, at least in our industry, may be one of the only business trained, meaning in school, I think you have a lot of people that come up from the field and construction and all these different things and even engineering, but to have accountants and financial people with real business training, like let's utilize those people and let's use those skills all we can. So we try to train that through our operations staff also.

It works in some places and it doesn't work in other places, but we manage it as we go.

Yeah, so let's talk about that. How important is financial literacy, like if somebody's running a profit center in your business, or you have a CM or whoever, it may be a PM, how important is financial literacy and like at what depth do you try to like teach that?

Oh, I mean, I think it's even a Bezos quote where he says, if you don't understand your business, you're going to fail.

And I think I remember looking up the Fortune 100 companies and I think 38 of the Fortune 100 CEOs came from a finance background. And you have to understand the business — and it's for a lot of things. It's: What am I going to spend my CapEx money on? Can I make this acquisition? Do I want to go into this separate market?

All those things are just math, right? It's just math. Okay, well, if I've got $10 million to spend on equipment, where do I want to spend it? Well, it's about return on investment. And how do you calculate return on investment? It's just math. It's not that everybody has to be able to do it, but you have to understand the math needs to be done in those situations.

So to me, financial literacy from an operational and from a leadership perspective — outside of finance — I assume that finance is going to be perfectly capable in that field or we wouldn't have hired people. But to really understand from a region manager, vice president, even construction manager, area manager — those people do have to understand, and they have to be able to read a P&L and make strategic business decisions and really kind of understand cash flow.

And understand that, you know, we kind of teach in some of our internal classes, but you could have a very positive financial gain or you could have a great year as a company and a horrible cash year. And that's exactly how people go bankrupt — because they don't understand that good profits don't always mean money in the bank.

And it's — you have to understand that you can't keep it going at the same pace all the time. You have to really be good at your balance sheet and good at the income state—

Yeah. And I did a post recently on LinkedIn and I just wanted to illustrate that very point. And I just used a specialty contractor in my example. I said, okay, how much does a landscape company making $3 million a year actually make?

And I kept the numbers really, really broad. But it's like, okay, let's say you make $300,000 in operating profit. A lot of people — you know, smaller contractors — may say, wow, that's really good. You know, I make $300,000, my business is doing well.

But then you're also not keeping track of working capital. So money that's tied up in contract receivables or in retention, right? If you're doing commercial projects, likely you have retention. And you're not accounting for capital expenditures. So you're buying trucks and tractors and trailers, and that's not hitting your income statement — that's coming in, it's hitting your statement of cash flows and it's being recorded on your balance sheet.

And if you don't understand the balance sheet and the statement of cash flows and how that all ties together — to your point, Brad — it's like, okay, yay, we did profit and we're at an 8% margin and things are looking good. But why are we pulling on our line of credit to make payroll? And why does cash feel so tight? And I think that's exactly what you're alluding to.

Yeah. And if people don't understand that concept just from a business perspective — like you said — I mean, it could be really demoralizing if you think you made $300,000, but yet you borrowed $200,000 from your line of credit, you've got no other money in the bank, and you're sitting there going, wait a minute, hold on one second. What are we doing here? How's this going to actually work for us?

Right. Yeah, it is a challenge. But that's where we do budgets and things like that. I mean, they're not — I don't want to say financial focus — because it's more of a conversation, right?

When we do our budget presentations to our parent company, it's much more conversational. We try to keep it, you know, tell me about what's going on — don't show me what's going on on a chart. Tell me what's going on.

Yeah, inherent in that is that you've done the research and you've looked at it and you've scanned your P&Ls and you've really analyzed your balance sheets and done cash flow assessments and really kind of figured out all the things you need to figure out.

So there's a lot of prep that needs to be done, but I think it's crucial. Like I said, I think the number's 38 — I'll get it wrong — but of the Fortune 100 CEOs came from a finance background. Goes to show you kind of what that means to lead a company.

Yeah, that's really, really interesting. And I like what you said earlier about it being a math problem. And I think oftentimes companies — they are struggling with math problems. And it's really like algebra, it's not like calculus. It's not super complicated — this to the exponential power of that divided by this other thing — it's really just, it's math.

So I was talking with somebody recently and he came to me, he's like, look, Steve, I'm getting all this pressure to grow the business. And he said, the problem is that we are upside down from a cash flow perspective every time we pick up a new customer.

And so he's like, so I'm getting pressure on one hand to grow, but every time we grow, we're burning cash. So I'm like, so then he's like, well, I go back to my investors and say, we could grow, but I need more cash — which is going to require another round of equity, which is going to dilute his equity position.

And I said, look, like, let's draw it out on the whiteboard. And so I had this whiteboard in my office and said, here's your mathematical equation to solve. It's: the cash you collect in 30 days should be greater than two times your cost of acquisition and the cost of delivery in the 30 days.

So if you think about it, let's say it costs you $500 to acquire a new customer, and then you put in place work — and we'll just keep the number simple — say it's $1,000, that's $1,500 that you're going to burn in cash. So if you're not collecting 2x that — $3,000 — then what you're going to do is you're just going to grow and you're going to require more and more cash.

And so those were his actual numbers: $1,500 is what it costs him to deliver on a new customer in 30 days to onboard them. And he was collecting $500 in cash upfront. So every time he brought a new customer, it's $1,000 in burn.

So if you think about this like with the construction project, if you're pursuing work — and I'm working with another contractor right now in the utility space — and it's like, okay, they don't allow for mobilization or upfront billing. So he basically goes out there and does the work in 30 days. He puts in place all this work. He pays payroll, covers material costs, submits a bill, and then he gets paid in 60 days.

So it's like, the more work he does and the more work he takes on, the less cash he has. And so the same thing with the other guy — like every single client he brings on, he's $1,000 negative in cash. So I said, you have to fix this math problem.

And it starts with your strategy: what's your market focus and position? What customers are you going after? What's your offer? What's your contract delivery? All that stuff — all those things play a part of a bigger strategy, a financial strategy.

And so oftentimes people think of strategy and it's like, Oh, it's SWOT analysis. And it's like, we're going to talk about mission, vision, and values — which is good. It's a good start. But then it comes down to: Where are we competing? How are we competing? And how are we winning? And what financial resources do we need to have to win? And what kind of returns are we going to earn based on that strategy?

And it all flows together. And I think if you don't have that, then yeah, you're going to be struggling with math problems and you're going to be doing a bunch of random stuff that's not creating value in a company.

Yeah. And I mean, I think sometimes mission and vision — not to say overrated — but it doesn't often think about if the customer cares or not about those things.

You know, you put the vision statement out there and mission statement, you feel good about it and it's something you roll out and maybe your employees are even involved in it in some way. But if the customer doesn't care about the values that you have and the things that you say in there — because they just want timely, good quality material or whatever it is, delivery of a service — then you're kind of failing the business, at least by setting a strategy around something that isn't going to offer any real end-line value. Do you know what I mean?

Yeah, exactly. I think businesses get caught up in that so much. You know, everybody wants to redo the mission statement — let's work on the mission statement, let's work on our values and the vision statement — all those things.

Okay, well, are we asking our customers? Are we going to the customer and saying, hey, what do you care about the most? Is it price? Is it reliability? Is it quality? Is it that service that we're going to be here anytime you need us?

You even look in the procurement space — it used to be a lot about price. You’d get three quotes and whichever one is the cheapest relative to the project, you might do it. But there's so many other factors now. If I have a customer service issue — who is going to service me better?

And what do I get? What do I get for my money? What's the product look like? Are they ever going to not deliver on time? Do they have inventory?

I mean, there's a lot of different things that go in there. But what the customer cares about and how you can bring value to the customer — I mean, that's what matters. If you do that, you should bring value to your employees and your stakeholders too.

Because employees should have a good place to work where we're engaged with our customers and really understanding that part of the business. And your stakeholders should have profits at that point. But it really should revolve around the customer to a certain point.

I love that. I think that's spot on.

Yeah, I mean, at the end of the day, you have to understand the customer, what drives their decision-making, and what would make them want to come back.

I mean, listen, we're in the road construction industry, so it doesn't happen all that often. But the times where a customer will come to us and say, “Hey, we've got a project, we'd like you to do it,” that's a great time for us — because it doesn't go out for bid or other things. If it's a private customer, that can happen.

But understanding what the customer's input is and what actually drives their decision-making is key to actually figuring out how you can, like you said, serve them better. So if the key force in their business might have been timely and accurate delivery of a project, because their timeline is maybe the most precious part of their life cycle of their job, then yeah, let's find a way to get it done quicker with safety and quality and all those things there.

But if we can do that, we may be able to unlock a new layer, right? And, you know, obviously business is focused on it, but I think you get caught up in maybe everybody in the company understands a SWOT analysis. So let's start there. Let's have everybody do one of those. And they do one per business unit. And what are my opportunities in this business unit?

And then you have to go around explaining the internal/external piece and you go through six months of, “Okay, we got to put this out there,” and then kind of let it fester a little bit or let it mature and see if we can get things done. And then next year rolls around and you just did the SWOT last year, but it didn't seem to do anything — or at least on paper, you can't tell.

And that's like the strategy purgatory, right? Where you do a strategic plan, but you can't tell if it worked or not.

It's tough.
 Yeah, exactly.

Let's talk about measuring strategy and kind of piggybacking on this idea. Do you have in your company, like certain KPIs or like, what does that monthly package look like? Do you have like an income statement, balance sheet, statement of cash flows you share with your team? Do you have like a KPI dashboard? Is it digital? Is it printed? Like, how do you manage the business and then convey that information to the people that need the information?

Yeah, I mean, in our regions, I would say we're pretty P&L focused, at least on a monthly basis. Quarterly, we do a little bit more work and from an income statement/balance sheet side — formal income statement/balance sheet — we do it at the corporate office quarterly, but the businesses are focused on their P&Ls.

But there's also a ton of other things — whether it's days in inventory, whether it's tons per man hour laid down or produced at an asphalt plant or a quarry. We try to give them metrics that are actionable because, you know, my complaint always on KPIs is it's like a sexy buzzword, but nobody really understands what a KPI is because it needs to be actionable by the people that you're delivering it to.

So if I give some kind of revenue KPI to somebody at one of the plants, they can't change that. They can't fix it in any way. If I give them tons produced per man hour, gallons sold per man hour, and they're in the production space at a plant, they can fix that, right? If it's lower than we want it to be, they can actually go and take care of that.

Is it maintenance downtime? So we have downtime trackers and things like that. Sometimes you have to get people to tell on themselves a little bit if it's downtime tracker or from a safety perspective, looking at near misses and close calls. They have to put, "Yes, I was down today and it was because I didn't do my maintenance yesterday," or, "Some other thing happened and I was down for two hours and we had trucks waiting in line," or, "I saw something that was unsafe and I want to report it on there."

Making sure that KPIs are understood and actionable by the people that are receiving it — which means in an organization, you might have to have five different levels of KPIs. And at the top level, maybe it's just EBITDA percentage of revenue. Maybe it's a cashflow metric on my side. Maybe it's a whole host of other things.

But at the plant level, it can't be that. And you can't deliver the whole package to the same five levels of people, because they're going to stop picking and choosing and hunting for the thing that they can look at — and they're just not going to look at any of it. It's like noise, right? It's just a lot of numbers on a piece of paper, like the Matrix going down. And it's just like, “Okay, well, I just… it's fine. I get this every month and I discard it.”

But if, let's say, you're a plant operator or something, and you get three or four solid KPIs. If you're in an asphalt plant and you talk about BTUs per ton — can I save and have produced at lower BTUs per ton, which means I've got to somehow engineer this way and with mixed designs and other things like that to use less energy?

Can I produce with less man hours? Can I have less waste? Can I use more recycled asphalt? Things like that. That's good for an operator. And it may also be good for the next level and all the way up. I mean, it could be.

But it's just sometimes scaling it down to the individual level on a KPI helps really drive the strategy. Because kind of like your IAR stuff — when you get the results and they understand what the results need to be at that level, it helps them try to achieve them and they know where they're at and they know where they need to be.

If I say, “Hey, we want to get 1% more EBIT in the company,” and I send that to an asphalt plant manager — probably have to Google it. I mean, in all reality, they just don't know how to change that. They're not the one selling material. They're not the one figuring out what price is. They're not the one buying inventory or producing inventory, vertically integrated inventory. Anyway, up the chain — they're not figuring transfer prices. They're just making material and putting it in trucks and shipping it out the door every day.

So a profitability metric for them doesn’t work.
 Yeah. And I love how you tied it back to behavior because you're right.

I mean, you can measure all sorts of things. It's like, "Let's measure the temperature of my office." It’s like, “Okay, let's measure, you know, this or that.” I mean, in a lot of companies out there, they'll either use ChatGPT, they'll Google it, they'll find some download on the internet — and then all of a sudden they have 50 metrics and they're measuring random stuff.

And to your point, it's like, yeah, we're measuring these things, but how does that tie back to the strategy and how does it actually influence behavior? So I love that. Very smart.

Yeah. It's like — I mean, even if you… different parts of the business are a little bit more unique. In construction, we might say, “How many tons did each asphalt crew lay on the ground today?” But it's not always relative. Because sometimes it could be relative to the job scope or something. So they might not have had the opportunity to lay 2,000 tons in a day. They might've been doing an intersection that day, or they might've been doing a two-lane road instead of an interstate or something where you have less ability to do those things.

So just because it seems good on the surface doesn’t always mean that it is actionable. You just have to be careful, because I think that at some point people can get too bogged down with so many initiatives and over-initiatized. And then when they have too many things like that, then every one of them suffers.

Yeah. Good point.
 How fast do you close your books?

About four days-ish, four and a half days. I mean, usually we're done by end of day Wednesday. We leave Thursday morning for some kind of final, just make sure everything happened. If you've got to make any extra entries, if there's system issues or something, usually the regions are closed by two o'clock on Thursday of close week. And then we kind of finish our corporate review and ask questions and look at accrual schedules and things like that.

And so we're usually done by the end of the day Thursday or early morning Friday, which, you know, for a giant company is I think pretty good, pretty aggressive.

One other comment just to make sure I, you know, in financial statements, especially if you don't get audited in every month, perfection is the enemy of good enough sometimes. Sometimes. And that is, you know, from a strategy perspective too, you have to make sure that you're focused on the right things. And if you try to get it all absolutely perfect every single time, you'll miss those critical windows where you could be impactful.

So I just, that's what I tell people too. Perfection is the enemy of good enough, which coming from the CFO sometimes doesn't always work in every situation. So I've got to pick and choose, but it is an important factor that we say.

Yeah, I love it. Cause there's going to be a lot of things that may be immaterial that could weigh down the financial close and it could delay things by a week or two weeks. And then that information is not in the hands of the field. And you're right. It doesn't necessarily matter. So that's smart.

Okay. Let me ask you this. When you're looking to hire a controller, say I was a controller and I am coming to you. I'm like, Brad, I really want a job with you. What are you looking for? Is it technical expertise? Is it cultural fit? Is it something else? What's like super critical for you?

I mean, I think we have gone away from culture fit and more go to culture add. I don't necessarily need somebody that fits into the same, to this culture necessarily, or else I'd get a lot of people that look and act like me. But I think culture add is a big point going forward — that you want people with some different opinions and some things. And I think that that's what drives a… it's like the whole, you know, whatever Malcolm Gladwell tipping point, how many people with a different opinion or things that you can get to actually change to make some real change.

I assume if they're coming to me, they have technical expertise and financial acumen and they can do the sort of blocking and tackling. I think what I look for is some kind of business insight. So whether it's just curiosity, whether it's a strategic mind to think like, “Huh, I wonder if there's a better way to do that,” or “I like that idea. Let's go forward with it.” Things like that — are people receptive to change?

Some people are, you know, if it ain't broke, don't fix it. And some people are, let's just change to try stuff out, right. To try a new way of doing things. It's probably a gentle blend of both of those with maybe more leaning towards, let's just change to see what's behind door number two. And then that strategic business partner.

But I don't always need every one of those in every one of the people. If I always look for somebody that was like a Swiss Army knife, you know, I can't — from a succession planning standpoint — churn people through the business fast enough sometimes. So if I have all people that could be a CFO one day working at a region and three of them are staff accountants and one of them's assistant controller, one of them's controller, we're going to get to a point where some people are going to not see their pace in the organization quick enough.

So you have to be receptive to the fact that not everybody needs to be this financial superstar, and professionals in place are often a much overlooked asset in our business — that you really can't do business without those people.

That's smart. So let me ask you this from a CEO's perspective. What if I was running a business and I have a CFO — how do I know if they're good or not?

That's a good question. I mean, you just ask them. No, I'm kidding.
 I guess, I mean, the strategy piece — and not all CEOs are the same way. So not all of them want somebody to bounce ideas off of — but that business partner perspective, and really do you work well with this person? Are the books getting closed on time? Are you passing audits? Are all the financial metrics you need to hit for whatever shareholder setup that you have — are all of those getting hit?

And I mean, I think you'll know if all of those are getting done. And if you have a financial person, or a strategic person I should say, I think you'd know. But yeah, I mean, it's a good question.

And my thing that I try to do every day is provide value for my president. And oftentimes, the way I do it today is different than the way I'm going to do it tomorrow. So today might be, I've got to get a bunch of stuff done and I've got to have meeting agendas and I got to just get some blocking and tackling stuff underway. We've got an audit coming from overseas, so I've got to handle that. And I've just got to communicate with him that, hey, you know, today I'm kind of working on this audit thing and I'm going to get the minutes out for the last thing.

Tomorrow it's, hey, you know, I noticed that, you know, our recycled asphalt percentage in one region isn't as good. Is there any outside resources we can leverage? Are there any strategic axes we can pull to see if we can get that up? And do we know why? And is it something that's a potential problem in the future? And I know we budgeted this much, and if we finish out the year this way, we're going to be under budget or something like that.

Presenting problems and solutions. You know, good employees come with problems, great employees come with solutions — kind of that. So if I'm ever going to my president with something, I had better come up with at least something that I've thought of to help.

If I'm going to call him up and say, hey, I'm kind of looking at the P&L, I think we might have an issue here where we're not going to hit our budget. I don't just like to come up with a problem and just say like, here you go, here it is, buddy. After we're off this call, if you want to just like figure it out and let me know what you need me to do.

Instead it's like, I kind of was looking into some data and maybe it looks like, you know, we're having a year similar to a year we had three or four years ago. One of the things we did sort of at the end of the year is we were calling customers and had a different mindset on the sales side. And what do you think of that? When you come with solutions instead of problems, it does help.

Yeah. And instead of coming in and saying, hey, here's the income statement. Here's the numbers. We have a loss. Instead of going back and saying, hey, we have a loss. Here are the three things I was thinking of. And, you know, this is what we tried in the past. And what are your thoughts on that? I love that.

Yeah. And sometimes you have to present a loss. Sometimes it's a, yeah, we didn't have a great month. We were supposed to make a couple of million dollars. We lost a little bit of money. But, you know, hey, listen, on the positive side, we had a great cash month. Our collection days are down. You know, our net financial position is in a much better place than we predicted. We got some early payments from customers. They haven't actualized into any profit yet, but we've got some early payments. And so our cash is up.

And so just being able to kind of do your due diligence to — in that case, soften the blow — but it could be the other way. You could say, you know, we lost some money, but I'm actually more concerned because cash is also not good. Right. So we've got maybe a double problem on our hands that we're going to have to figure out.

Yeah. No, I love that.

Okay. I'm looking back on your past five years ago, Brad — younger Brad — and now looking at where you're at today, is there anything where you, when you look back, you think, oh my gosh, I wish I would have known this? Or you're like, oh, I can't believe I used to do that? Just for the listeners who are thinking, okay, I'm progressing through my career as well — like watch out for this or like don't do that or here's a huge learning that I had along the way.

I think the biggest thing I've probably learned over the last five years is just really, truly how to embrace work-life balance, right? There's the whole, you know, your health, your friends, your family, and your job. And you can only really be active in three of them ever. Right? So if you're really working overtime and you're just killing yourself and you've got all this stuff going on, something—either your health and your personal life—is going to struggle, you know, your family's not going to see you as much.

And I think it's been just really embracing what that really means. Don't take things home with you if you can't leave them at the door. You know, when I'm in the ground, it's not going to say on my gravestone that I was a great CFO. It might say I'm a great father or husband or something like that, son or something like that, but it's not going to have anything to do with work on there.

So you kind of just have to put it into perspective—not to say that this isn't important and this isn't, you know, the way you put food on the table. But if you're stressed out and you're taking all that stuff home every day, you're not probably being the best version of yourself at home and with your friends and all these other places.

So just really figuring out what that means for you individually. And so sometimes it's, hey, I'm just going to—I got to take a mental health day every couple of weeks, or, you know, I'm going to try to do a fun activity at work or, hey, you know what? I had a hard day, but when I leave and walk out the door and shut the lights off and do a little reflection at the end of the day like I do, it's okay. You know, every day is another day and you're going to wake up tomorrow and it's going to be great again. And trying to figure out the little things that make you happy, because I mean, it's really the most important thing—that mental health and all that. It's really important.

Yeah. I love it, Brad. I love your perspective. You do such a great job in your role. And I just—I really appreciate your strategic thinking and all the things you've taught me, you know, not just during this episode, but over our friendship here. So thanks for being on the show.

Well, thanks, Steve. I appreciate it. I always like to look forward to your LinkedIn posts. So I'll look forward to them again. I'll look at some other ones.

All right.