If Cash Is King - I'm The King Maker
Veena Gundavelli
President & CEO, Emagia Corporation
Santa Clara - CA US
Tell us what you do and the specific challenge you faced.
As co-founder of Solix Systems, an enterprise software management consultancy, it was painfully obvious that the way companies handled cash flow was completely outdated. Integrated software tools were desperately needed that allowed companies to centralize and automate all activities related to the flow of cash, to collect cash faster, improve forecasting capabilities and boost profitability. I knew that companies that successfully adopted such technologies would hold a powerful trump card over competitors. That's when I assembled a team of top-notch engineers and powerful investors and advisors, and founded Emagia Corporation. The hard part was convincing customers in a down economy that they need to use Emagia software to better manage their finance processes. This was not easy because most companies are unwilling to admit they have financial problems for fear of upsetting shareholders.
What was your moment of truth?
We painstakingly identified the companies and industries that took the longest time to collect cash that was owed to them. But we knew that aggressive sales alone would not be enough. We needed a backdoor to sell into a reluctant customer base. We decided to inform, and leverage as a channel, any organization in a position to guide companies out of financial crisis about our software. Our efforts paid off. A crisis management consultant suggested that Leiner Health Products, a company in bankruptcy, consider Emagia's cash flow management tools to help reverse its financial predicament. Industry analysts also began informing clients about Emagia software solutions, resulting in two multi-billion dollar client wins: Hyperion and a division of Solectron. While our channel strategy was successful, our defining moment came with customer success. Leiner reduced its outstanding receivables by more than 75 percent within just 6 weeks of implementing our software-saving the financially-strapped company millions of dollars. We received 40 sales calls after issuing news of Leiner's success in June, 2002. Subsequently, $18 billion Solectron implemented Emagia's suite of products company-wide based on initial success. Solectron can accurately forecast cash flow and earnings up to three quarters ahead. (The exact date? 5/20/2002)
What were the results?
More organizations are now turning to Emagia because of the success companies like Leiner Health Products and Solectron have had using our software. Emagia continues to sign prominent new customers including Network Associates and Advanced Fibre Communications. Network Associates plans to implement Emagia's suite of solutions throughout its global organization. Smart cash flow management is all the more important lately with stricter securities regulations. Companies are realizing that they need to more effectively manage their entire financial supply chain to improve cash forecasting and accelerate cash flow.
What's your parting tip?
Solutions for companies must be specific and tangible with results achieved in real time.
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