HOW RUTH PORAT – CFO, ALPHABET (GOOGLE)SAVED GOOGLE FROM ITS FINANCIAL CRISIS DURING 2015–2016?

 HOW RUTH PORAT – CFO, ALPHABET (GOOGLE)SAVED GOOGLE FROM ITS FINANCIAL CRISIS DURING 2015–2016?

RUTH PORAT CFO OF ALPHABET (GOOGLE)

At present Ruth Porat is the President & Chief Investment Officer (CIO) of A, having transitioned from her long tenure as CFO (Chief Financial Officer) in July 2024, a role she held since joining in 2015 and also retains it now also.

She now oversees major corporate investments, including Alphabet's "Other Bets," works with policymakers, and manages philanthropic efforts, building on her deep finance background from Wall Street.

THE  FINANCIAL CRISIS FACED BY ALPHABET AND GOOGLE  IN (2015–2016)- A CASE STUDY

When Ruth Porat joined Google as CFO in 2015:

·      Google’s costs were spiralling due to moonshot projects (self-driving cars, Google Glass, etc.)

·      Investors complained about lack of transparency

·      Margins were under pressure despite strong revenues

·      Stock performance was lagging compared to peers

·      Many analysts feared capital inefficiency could erode shareholder value.

CFO RUTH PORAT ACTIONS THAT VETOED FINANCIAL CRISIS

1. Cost Discipline without Killing Innovation shifting from blunt cost-cutting to strategic optimization, focusing on smart resource allocation, process efficiency, and empowering employees to find smarter ways to work, using technology to automate low-value tasks and reinvesting savings into growth areas, not just cutting budgets.

2. Introduced rigorous budgeting for “Other Bets” The "Other Bets" segment includes early-stage, high-risk, long-term ventures or "moonshots" such as Waymo (self-driving cars), Verily (health tech), and Wing (drone delivery)

3. Forced each project to justify funding with measurable milestones

4. Shut down or restructured loss-making initiatives

OUTCOME

Losses in “Other Bets” reduced significantly over the time.

WHAT REFORMS CFO RUTH PORAT INTRODUCED?

1. Implemented return-on-capital metrics which will help in measuring how efficiently a company uses its total capital (debt + equity) to generate profits, indicating profitability and value creation for all capital providers.

2. Introduced share buybacks to return excess cash to shareholders which boosts Earnings Per Share (EPS) and often resulted in the upward trend in the stock price.

3. Gave more Priority to high-margin businesses like Search, YouTube & Cloud.

HOW RUTH PORAT ENGULFED TRANSPARENCY TO RESTORE INVESTOR TRUST

1.RUTH PORAT Created the Alphabet holding structure

2.She Introduced Segmented reporting for Google vs. Other Bets

3.This has Improved earnings call disclosures which is a general trend in corporate reporting, driven by regulatory changes and the widespread adoption of technology-enabled supplementary materials like slide decks.

4.This move alone radically improved market confidence and its share price started to surge.

BALANCE SHEET CONSOLIDATION BY RUTH PORAT

1.   CFO strategy resulted in the Maintenance of strong cash reserves.

2.   She Controlled debt despite aggressive growth.

3.   She ensured liquidity even during tech downturns.

RESULTS

1.RUTH PORAT strategy increased Alphabet’s market value which was more than tripled over the next few years.

2. Company’s Operating margins stabilised.

3.Share price surged, outperforming many Big Tech peers

4.Alphabet became a case study in CFO-led financial governance

WHAT ARE THE TAKEAWAY FOR THE CFO’S IN ALPHAPET-GOOGLE FINANCIAL STRATEGY

v A CFO doesn’t just “report numbers”—they shape strategy

v Transparency can be as powerful as cost-cutting

v Financial discipline safeguards innovation, it doesn’t extinguish it

v Strong CFO leadership can antithesis investor sentiment

R V SECKAR, FCS, LLB, 79047 19295

THE SUCCESS STORY OF KUMARA MANAGALAM BIRLA - ADITYA BIRLA GROUP- A CASE STUDY

THE SUCCESS STORY OF KUMARA MANAGALAM BIRLA - ADITYA BIRLA GROUP- A CASE STUDY 

 Imagine being 28. Studying in London.

And one phone call suddenly puts ₹15,000 crore empire, 100,000 lives, and a legacy on your shoulders.

Can you handle it?

Kumar Mangalam Birla did. Here's how:

𝐓𝐡𝐞 𝐜𝐚𝐥𝐥 𝐭𝐡𝐚𝐭 𝐜𝐡𝐚𝐧𝐠𝐞𝐝 𝐞𝐯𝐞𝐫𝐲𝐭𝐡𝐢𝐧𝐠:

October 1995. London Business School.

"Your father suffered a heart attack."

Aditya Vikram Birla - gone at 51.

Kumar Mangalam was just 28. The Aditya Birla Group: ₹15,000 crores revenue, India's 3rd largest business house, 100,000+ employees.

All suddenly his responsibility.

𝐓𝐡𝐞 𝐝𝐨𝐮𝐛𝐭𝐬:

"He's just a kid with an MBA."
"No real experience."
"The empire will crumble."

First board meeting? Executives 30+ years older. All watching. All doubting.

Most 28-year-olds are figuring out careers. He had to lead India's 3rd largest conglomerate.

𝐇𝐨𝐰 𝐡𝐞 𝐩𝐫𝐨𝐯𝐞𝐝 𝐭𝐡𝐞𝐦 𝐰𝐫𝐨𝐧𝐠:

Move 1: First 100 days - visited every major plant. Met 1,000+ employees personally. Didn't pretend to know everything. Learned fast.

Move 2: Closed 14 non-performing businesses. Focused on 5 core sectors: Metals, Cement, Textiles, Chemicals, Telecom.

Move 3: Went global when others feared. Acquired companies in 36 countries - Thailand, Egypt, Canada, Australia.

Move 4: Launched Idea Cellular in 1995. Critics said "Birlas don't do telecom!" It became India's 3rd largest with 200M+ subscribers.

𝐓𝐡𝐞 𝐫𝐞𝐬𝐮𝐥𝐭𝐬:

1995: ₹15,000 crores
2025: ₹5,50,000 crores ($67 billion)

35X growth in 30 years.

Today:
→ World's largest aluminum rolling company
→ India's largest cement manufacturer
→ 400+ million customers globally
→ Present in 36 countries

𝐓𝐡𝐞 𝐝𝐞𝐟𝐢𝐧𝐢𝐧𝐠 𝐦𝐨𝐦𝐞𝐧𝐭:

2008 crisis. Everyone firing employees.

His message: "Not a single job cut."

Zero layoffs. When economy recovered? Best talent stayed loyal.

He chose people over short-term profits.

𝐖𝐡𝐚𝐭 𝐲𝐨𝐮 𝐦𝐮𝐬𝐭 𝐥𝐞𝐚𝐫𝐧:

✅ Age doesn't matter when vision is clear
✅ Listen before you lead - 100 days learning paid off
✅ Focus beats diversification - cut 14 to master 5
✅ Think global early - 36 countries expansion
✅ People are real assets - zero layoffs = lifetime loyalty

𝐓𝐡𝐞 𝐫𝐞𝐚𝐥 𝐥𝐞𝐬𝐬𝐨𝐧:

Life doesn't ask if you're ready.

Kumar Mangalam wasn't "ready" at 28. Nobody is.

But he showed up. Learned fast. Decided boldly. Led with values.

₹15,000 crores → ₹5,50,000 crores. 35X in 30 years.

𝐘𝐨𝐮𝐫 𝐦𝐨𝐯𝐞:

Stop waiting for "more experience."

Someone younger is already building what you're planning.

Your toughest moment might be your defining