Over the last decade, the Chief Financial Officer’s job has become increasingly complex due to the rapid adoption of different digital technologies and the inherently global nature of the business. Once we add to this the multitude of uncertainties on a macro-economic level worldwide – such as China-US trade tensions or Brexit – it becomes clear that today’s CFOs face more challenges than ever. To succeed, they need to rethink what their job is and how they are perceived by others in the business.
Reimagining the financial workforce
The CFO and the finance team are reinventing their roles by embracing the latest digital technology innovations and exploiting data. These technologies have helped the CFO shift their focus from what has happened and why, to what will happen next and how it can be influenced. They have been able to generate forward-looking insights across crucial areas such as go-to-market strategy and customer satisfaction – not only reducing costs and increasing productivity but also enhancing consistency and accuracy. It is about aligning and preparing the organisation to meet future uncertainty and challenges.
There is early proof that adopting digital technologies has a direct impact on the bottom line. In our Cycle of Progress study, decision makers cited enhanced efficiencies as the top benefit of the Internet of Things (IoT) and predictive analytics. Yet, in most businesses the finance function is still at the start of this digital transformation journey – there is a lot more that can be done to maximise the benefits of different technologies for the team and the wider business.
New tech, new skills
To be able to capitalise on the opportunities that the latest digital platforms bring, the CFO needs to look beyond accountants and analysts and build a finance team with a more diverse set of skills. This team will be able to collate, validate and link the data to the bigger business picture, and work hand in glove with the rest of the business.
Furthermore, with the gamut of data that is generated along this journey, comes security concerns as well. Being one of the chief custodians of sensitive information within the business means that the CFO has a responsibility to ensure the integrity and security of the data that the finance team manages. As the threat of cyber-attacks continues to grow in businesses worldwide, the CFO should work with their peers in the C-suite to identify the most valuable data assets for the company, check that its storage and management comply with the latest rules and regulations globally, and conduct a risk assessment to understand the financial and reputational implications in case its integrity or security is compromised.
Changing the hiring and team management strategy by bringing in new skills, systems and a more collaborative approach is not only a requisite to thrive in today’s dynamic business environment – it is also about staying relevant in this digital age. The business environment is changing at a rapid pace and the whole organisation needs to be digitally aligned including systems, processes and people. The CFO and their team need emotional intelligence to be able to work effectively with others and help drive digital transformation across the organisation.
Value creation beyond profit margins
In some forward-looking businesses, the finance function has led the charge in the adoption of digital technologies such as artificial intelligence (AI), cloud and predictive analytics, and now the rest of the business is following suit to uncover trends to streamline operations, reduce operational costs and help propel the growth of the business.
Thanks to learnings from being an early adopter, the finance team can act as digital evangelists, collaborating closely with the rest of the business to spur creativity and debate in operational excellence. This also means that while many CFOs are exploring new ways of working through automation for the finance function, they are also increasingly involved in discussions on how digitisation could transform other areas of the organisation to enable new business models or unlock new revenue streams and make the business future ready.
Around the world, CFOs are experiencing a fundamental shift in how they are perceived. They used to be seen as simply responsible for managing the company’s finances – now many CFOs are considered digital trailblazers, harnessing data-led insights to develop innovative approaches for tackling new challenges inside and outside the business.
As digitisation continues to gather pace in organisations worldwide, the job of the CFO has never been more challenging and all-encompassing. CFO has to judiciously marry the new world challenges with stability provided by mature time-tested processes and have to simultaneously adopt the new regulatory challenges. Today’s CFO can be best described as the new age trapeze artist continuously playing the balancing act.
Read about why having a financial acumen is important across all levels in our previous blog.