Updated: Mar 28, 2019
The role of the CFO is evolving. In the past, the role of the CFO was largely siloed within finance and responsible for aspects such as financial planning and reporting. CFOs nowadays have becoming more and more involved in evaluating business decisions, risks, and the needs of stakeholders etc. So why is this change occurring, and what can CFOs do to best lead their organisations amidst the oncoming challenges?
1. Emerging new technologies
Emerging technologies, such as Corporate Performance Management (CPM) software, have allowed CFOs to gain control of their data, allowing them to develop into a deeper strategic and decision-making role. The performance management market has grown rapidly in recent years, and is presenting many options for CFOs to provide their finance teams with better systems to model and present data to the executive.
As stated in our previous blog posts, traditional financial reporting and analysis methods such as excel spreadsheets are not only error prone, but the excessive amount of time spent on collecting and then aggregating data into reports leaves little time for performing analysis and interacting with decision makers. Organisations are stuck with increasingly large volumes of data which are often disconnected and separate from each other.
New technologies, such as CPM software, have allowed CFOs to implement a systemised approach, providing finance teams with a singular unified platform of information. In contrast to the massive siloes of disconnected data streams, finance teams now have access to the information through a ‘single version of the truth’. Thus, they have a better, more holistic view of the business information.
2. How can CFOs best lead organisations in these times of change?
In our current digitalised world, CFOs, as leaders, are in the position to create a strategic difference to the organisation. By implementing infrastructure and strategies to handle and model data efficiently and accurately, CFOs can ensure their finance teams are best equipped to deal with the oncoming challenges of their organisations.
By leading the movement towards eliminating the inefficiencies by means of a systematic approach, CFOs can help organisations allocate time for actual value-adding analysis, and improve existing processes. Through these mechanisms, CFOs can also provide a method for other departments and divisions to be able to self-manage.
Most Australian businesses already know they need digital transformation, yet ‘less than a third “have a companywide strategy for sharing data”’. Emerging new technologies have enabled changes in the role of the CFO, allowing them greater access to information for strategy and decision-making. CFOs as leaders can create not only a strategic difference to organisations, eliminating the inefficiencies creating a more efficient, analytical and accurate decision making environment.
How can CFOs go about this?
CFOs should ensure the solution aligns with business strategy. By championing the strategic vision and business values of the organisation, the people utilising the solutions and analysing the data will be able to actively understand and use it to drive process improvement.
CFOs should also build the right team to support the tool and foster a narrative of change within the organisation. The risk lies in where there is no desire for the solution, and a lack of skill sets to adopt the technologies. By creativity innovation, inclusion and training, finance leaders can to create an environment where employees are inspired to go on the journey with them.
If you would like to inquire about any of these points in detail about implementing a systematic approach to planning and reporting contact us at www.oyb.com.au