The evolving role of today’s CFO
Amid uncertain economic conditions and a dynamic business environment, the way many CFOs support their organisation is changing.
Where their focus has traditionally been on cash flows and forecasting, they’re becoming increasingly involved in other parts of the business. In many cases, the line between the responsibilities of the chief financial officer and those of the chief operations officer (COO) is becoming blurred.
A key force driving these changes is a desire for improved risk management. Organisations should contend with everything from ongoing supply chain disruptions to a lack of skilled staff. Add to the mix factors such as increasing pressure from competitors and evolving customer demands, and the challenges for CFOs become even more acute.
These challenges were highlighted in recent research conducted by global business consulting firm Protiviti. The company’s Global Finance Trends survey found that, when asked to nominate their most pressing concerns, none of the top 10 were accounting-related issues.
Topping the list of concerns was achieving effective security and privacy of data, followed by profitability reporting, analysis, blockchains, and smart contracts.
These results confirm that the CFO’s remit has been expanded to cover additional parts of the business. Rather than being the ‘chief number cruncher’, many are increasingly being seen as purveyors of data that is needed to support strategic decision making.
The ongoing journey of digital transformation
Within many organisations, the evolution of the CFO’s role is being supported by an ongoing strategy of digital transformation. This is being undertaken to improve agility and allow executives to be more responsive to changing market conditions.
By digitising and streamlining processes, CFOs can increase the rate at which new data is made accessible, and support decision-making processes. This can be very powerful for organisations that need to make changes or shift direction in challenging conditions.
Today’s CFOs are also constantly on the hunt for ways in which they can harness emerging technologies to further propel growth. Working closely with their chief technology officer (CTO), CFOs are evaluating new options and assessing the value they can potentially deliver.
One example is the rapid rise of generative artificial intelligence tools such as ChatGPT. Already able to undertake and automate a variety of tasks, the capability of such tools will continue to proliferate making them even more compelling for organisations of all sizes.
Managing processes and data
As well as guiding digital transformation strategies and assessing potential new tools, today’s CFOs are also increasing their focus on managing data within their organisations. This includes processes that are in place that allow it to be collected, analysed, transferred, and stored.
There is little point in having powerful new tools in place if the data they need to function is not being managed effectively. Achieving this includes removing siloed data stores and ensuring underlying processes are as automated as possible.
CFOs should also keep in mind the fact that many processes within their organisations that were quickly altered at the start of the pandemic lockdowns are still in that state. Before process automation and new tools are introduced, each should be carefully examined to ensure they continue operating efficiently in what is now likely to be an ongoing world of hybrid working.
A culture of innovation
With these new facets to their roles, CFOs are well placed to help establish and drive a culture of innovation across their organisation. Understanding how data, processes, and tools can work together allows them to promote opportunities in which they can add value in new and exciting ways.
Successful CFOs are now much better positioned to help their organisations thrive, despite the external forces that can create challenging conditions. It should be remembered that it’s often periods of uncertainty that create great opportunities.
By Christian Lucarelli, vice president, Asia Pacific, Nintex
