Introduction
In the past four years Zarin Patel has focused on repositioning the BBC’s finance department, boosting its efficiency and finding new and innovative ways of reducing costs. Her key focus is now on delivering more with the same amount of money and resources. She became the broadcasting corporation’s first female finance director in 2004. A member of the BBC’s executive board, Patel is responsible for financial strategy, planning, control, and corporate reporting activities. She joined the BBC in 1998, having previously spent 15 years with KPMG, one of the “Big Four” accountancy firms. She qualified as a chartered accountant after graduating in economics at the London School of Economics in 1982. Named as one of the most powerful people in the British media by The Guardian, Patel recently graduated from Harvard Business School, where she spent two months before returning to her role at the BBC in November 2008. She is also Governor of the University of the Arts, London.
Financial Pressure at the BBC
When a business has to adapt to an economic downturn, finance’s instinctive role might be to keep the creative drive in check, to communicate tough messages and to shepherd the business through an uncertain period.
In such an environment, you might expect the focus on financial stability to influence the core skills that are sought in finance managers. At the BBC, where finance’s role is so much about demonstrating value in our decision-making and how we spend the licence fee, this expectation might be even more pronounced.
The current economic downturn has given rise to unprecedented levels of uncertainty across all business sectors. People have had to contend with new jargon, and with language, previously reserved for the trading floor, being used in news reports and staff communications. In addition, every area of the business is being challenged to find new and innovative ways to reduce its cost base, to create headroom against already pressured budgets, and to actively manage financial risk.
The BBC has been facing similar challenges and financial pressures; however, operating in a fixed revenue business, with clear accountability not only to the BBC Trust, the group of independent trustees, but also to the licence fee payers themselves, adds an extra dynamic to our approach to risk. Our reputation, both editorial and financial, has to be a constant consideration in decision-making.
One of the biggest and most reported casualties of the recent downturn has been the property market; and there seems to be limited respite predicted from the current conditions in the coming financial year. Following the licence fee settlement back in 2006, the BBC embarked on a review of its property strategy to raise additional income to invest in program making.
The strategy which emerged, to streamline our property portfolio and exit 30% of our buildings over the coming five years, has inevitably been affected by such a sharp decrease in commercial property activity. Empty offices across the UK give us a very clear indication that we need to review our timetable. Even though the longer-term strategy remains intact, we have had to revisit both the assumptions we made in valuation of assets, and the timing of any receipts.
Property is, of course, only one of several areas where we have been streamlining our activities and making bold decisions to reduce our cost base and generate additional income.
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