CFO Studio Magazine with David Chambers, CFO, Jaguar Land Rover NA

3rd QUARTER 2016 WWW.CFOSTUDIO.COM 11 A high-level committee, including Chambers, set Land Rover’s strategy at the end of the financial crisis. The record-setting 2015 results, up 37 percent, made Land Rover the fastest-growing brand in the U.S., fulfilling the promise of that plan. At the end of 2014, Chambers; Joe Eberhardt, CEO of JLR North America; and the product marketing organization began meeting to create a plan for a next generation of Jaguar. New models were to be launched in 2015 (a new XF and a freshened XJ) and two models come out this spring (the 2017 Jaguar F-PACE, the brand’s first performance SUV, and the XE, a compact sports sedan). The high-level team took a look at customer concerns with the Jaguar brand and spent six months devising a strategy to dramatically increase the presence of Jaguar in North America, essentially the brand’s best opportunity for success. With more competitive prices, Jaguar is attempting to broaden its market by appealing to millennials and lure buyers of, say, Audi and Volvo. In addition, the strategy addresses a key negative among potential purchasers: the outdated reputation for reliability problems. The team brought in consultants, debated adding costs, and looked at the levels of risk associated with each element proposed. They agreed to a “best in class” five-year, 60,000-mile warranty with complimentary scheduled maintenance on all models and named it Jaguar EliteCare. Chambers and Eberhardt ultimately took the new customer care plan to the U.K. where it was again debated and finally approved. Although for competitive reasons he can’t detail all the adjustments JLR will make to balance out the strategy’s costs — including a big boost to the marketing/P.R. budget to communicate Jaguar EliteCare —Chambers says more than one traditional automotive payback is applicable. For instance, by having more competitive prices in the market and thus achieving more demand, “you’re likely to achieve better residual values on your products and then you’re going to incur less cost when you lease your product.” He adds, “Conceptually, the comprehensive coverage should add perception of the vehicles’ value as well, but that one’s harder to quantify because you have to let it run through the system.” Asking Questions From his early days at Ford, Chambers started watching people he thought were good leaders and asking himself what they did that made them successful. He tried to see how they acted and reacted, and how they looked at things and were able to analyze the business. He was only three years or so into his career when he realized that he had to take charge of his career himself, that it was up to him to ask his boss how he was doing. Today, he asks his direct reports, “What can I do better?” “I think you have to have that kind of mindset: be self-aware and be willing to take a risk and take on tough jobs. Those are the kinds of things that really help you.” Chambers views himself as an influencer, and to be that, he has made an effort to develop the respect of people outside the finance organization: the operating teams. As a thought leader, he believes it’s one of his duties to raise questions regarding any presentation he sits through. And as CFO, questions come naturally. “A finance person always asks why,” he says. “My team has a standing little joke about me that it’s impossible to get anything through without at least a question.” He uses questions, he says, to help mold his team. “I’m always going to ask the question ‘Why?’ It’s trying to help them see how I look at it.” Curiosity is one of the traits he has identified as key to a good finance executive. He says that CFOs should be wondering: “‘What’s going to happen a year from now?’ ‘We want to do this now but what’s going to happen down here?’ ” he says. Chambers believes that JLR North America’s finance organization can influence the success of the company by asking and answering questions no one has tried to solve before. Data analytics can help JLR see what the dealers are ordering versus what Jaguar and Land Rover are building, getting into specifics like the mix of powertrains (V8 vs. V6) or the regional differences in consumer preferences. He says the data is all there; it’s just a matter of bringing it together: “My personal view is that’s probably one of the biggest areas of opportunity…. We have the ability to influence up front, during the product development, but once the vehicles are here, mastering local market dynamics is where our opportunities are.” Chambers is clearly pleased to have been part of assembling the people of JLR North America, defining and executing the strategies, and “getting to see my fingerprints on things that happen within the organization.” And now he can anticipate being able to invest in “untapped areas” in which larger competitors are involved. The company has come a long way since 2009 when it sold 38,000 Jaguar and Land Rover vehicles. In 2015, U.S. sales totaled 85,048 vehicles, a 123 percent increase since the sale to Tata Motors. Chambers is proud of what he and the team around him have done and excited for the future, taking it one five-year plan at a time. C “TO ME A CFO SHOULD BE VIEWED AS AN OPERATING PERSON WITH FINANCE EXPERTISE.” — David Chambers, Chief Financial Officer of Jaguar Land Rover North America