DFIN Road to Transformation with Dan Leib, DFIN’s President and CEO

Dana Barrett - It's a newer, emerging.

Dan Leib - Exactly. New and improved

Dana Barrett - Yes, new and improved, I like that. Yeah, absolutely. So I know part of the strategy also has been some really great partnerships. So, can you talk a little bit about that part of the strategy and where that's headed?

Dan Leib - Absolutely, and one of the interesting things on partnerships is they need to be bidirectional. So both parties need to benefit. I'd also say, we did a lot of work, right? Pre-spin and after spin to understand where we make our money, why our clients use us, what are the critical strengths assets, and beyond assets, the capabilities that we could leverage into a digital world and based on that, that then defines why we exist for our clients and from there, we can go to broadening out our offering via partnerships.

But we also recognize that we can't have too many partnerships. We'd rather have fewer high impact partnerships. So if you look at our partnership roster today, it's really top of the line, blue chip, from Cision, to Diligent, to NetSuite Oracle, to FloQast. I mean, these are fantastic brand names and they give us credibility and we also in the markets in which we play, give them credibility.

Dana Barrett - Yeah, it's interesting that you brought up the bidirectional aspect of it because I was talking with the folks from NetSuite and I was sort of asking about the partnership and even just as I was researching it, you could see that it made total sense.

Dan Leib - Right.

Dana Barrett - That if you guys are talking to a younger company that's pre-IPO, they don't have a system like NetSuite yet they need it, but they come to you because they want IPO.

Dan Leib - Exactly.

Dana Barrett - And then the reverse.

Dan Leib - Right, and so what differentiates us from our competitors is we take clients from private through the transaction, into compliance, keep that relationship ongoing, and then we help with growth. So M&A, different growth initiatives and so having partnerships like that, and I think the reality is partnerships are challenging. Right and so-

Dana Barrett - Yes they are.

Dan Leib - So they are can of all sorts. So there can be instances where if set up wrong, it's zero sum and that's not great for anyone and so what we really-

Dana Barrett - It actually do, it could be worse, right. You could actually damage each other.

Dan Leib - Exactly.

Dana Barrett - And to exceed it.

Dan Leib - Right, right.

Dana Barrett - But it sounds like if you had to pump the brakes at some point a little bit to preserve the business and I don't mean preserve, but to make sure you're doing everything right.

That's an option too.

Dan Leib - Absolutely, yeah. We've built a tremendous amount of financial flexibility. So via at the spin, since the spin we've we paid down about 550 million of debt. We were almost, we have a marginal amount of debt at this point and we've accelerated investment back into software growth. We've accelerated investment into some of these transformation initiatives, and we're in a great spot where in this economy, the dollars of investment aren't the limiting factor. It's finding skilled talent to execute against it and that's a great place to be.

Dana Barrett - So since you brought up talent, can we talk a little bit about all the various stakeholders in this transformation and how they're sort of experiencing it? So you've got employees, customers, how are they viewing this from the outside? What's your take on that?

Dan Leib - Sure, yeah. So, I always say we have three. My job is to allocate resources amongst our three main constituents which are employees, clients, and shareholders. There's a balance, right? I think when I look at the employee base, we've rolled out, we've improved our benefits year over each year that we've been in existence. We've added a lot of recognition for performance-based recognition for employees.

We've redesigned our entire value proposition for employees from time off, to the four mentioned benefit plans, to a new compensation structure, to new job opportunities and so we really are mapping out and communicating to employees, “If you come work at DFIN, here’s what you can expect from us”, and that really resonates in this environment.

IWe've gone to a fully flexed work environment outside of manufacturing and that's been a really good strategic hiring initiative for us.

(Dana laughs)

Dan Leib - We have closed the number of offices rather and taken advantage of the market with the knowledge that if we do need to take more space, because it makes sense in the future, there’ll be more commercial real estate available.

Dana Barrett - Of course, of course. All right, so in the other two pillars, the shareholders and the clients talk about their experience a little bit.

Dan Leib - Yeah, so shareholders, and it’s interesting. When we spun out, we took the position of we are going to invest heavy to make this transformation and we had some periods of time that were a bit more challenging from a financial performance perspective, and we mapped it out for the leadership team and said, "Look, this will be the investment period, and then you're going to see the return period."

Dan Leib - The other way of calling a 44 and 24, which again the marketing people wouldn't let me go with, which was 56% not software in 24. So there is a very important part of our business and it's one of the other things that differentiates us from our clients is we can serve our clients in the manner in which they want to be served and that traditional part of our offering is critically important and that traditional part then feeds into the software part over time. But you can then play both sides of it and operate a very profitable business in both areas.

Dana Barrett - Yeah, I think a lot of companies will tend to treat their former services business like it's a legacy thing, and it's sort of phasing out. I like the fact that you're asserting that's not the approach here and there’s always a need for that human expertise, that service that never goes away.

Dan Leib - Yeah, and it goes back to our assessment at the beginning, that this change did not need to be at a pace. We weren't trying to run away from something. We were trying to move towards something, and I think the pace that we've had has been really helpful.

When we go through transformation initiatives, we don't look at why things were the way they were. We look forward to, we look at what they could be.

Dana Barrett - Yeah, yeah, absolutely. Well, listen, Dan, before we wrap it up, anything else you want to share? I mean, I've got you in the seat, so this is it.

Dan Leib - - No, I would just say, I'm extremely happy with what we've achieved, and I think for me, the best news is that the opportunity in front of us far exceeds what we've already achieved.

Dana Barrett - Awesome, well, Dan, thank you so much for spending a few minutes. I really, really appreciate it.

Dan Leib - Thank you.

Dana Barrett - This has been the Insider by DFIN, we'll see you next time.

This has been the Insider by DFIN. We'll see you next time.