One of the most common stereotypes is that the CFO sits in an ivory tower distant from the business, always says ‘No’, and he is an introverted number-cruncher who is not very proactive. Still to this day some might describe CFOs as experienced senior accountants, conservative individuals, looking to control costs and deliver future forecasts based on historical data. Many would argue whether the CFO is a forward looking strategist who shares responsibility for results across the entire business.
On many levels all of the above is still true today, but the role of the CFO is evolving rapidly to a much wider and more diverse number of tasks, roles and responsibilities and this defines what is expected from us today, externally and internally.
Today’s finance executive will need to balance more between being a credible technically astute professional and a strategic visionary leader who inspires people beyond his / her own team. At the same time the CFO is the person who needs to understand every functional area of the organisation deep and wide enough, to be able to drive the business to the next level. We need to possess the ability to communicate and engage with senior business leaders, multiple stakeholders externally and internally, our customers, and of course above all – our people.
But even that’s not enough. As we’ve seen in this last ten years, CFOs have to be leaders of change. Businesses need to constantly adapt for survival, respond to global challenges across the world. There needs to be a healthy level of disruptive innovation bringing processes and systems together, and CFOs play a critical role in all of these emerging trends. CFOs need to be open to business transformation and the transformation of their own world, willing to adopt a flexible mindset, become agile, resilient and calm – this is what counts in the CFOs contribution in the Board room.
Technology can help by becoming a real driver for positive change, and a finance executive must have a deep understanding of the innovations which are transforming the way business is done, as well as the way they can help meet strategic goals and challenges. These include:
Big Data Analytics
Any finance executive will understand the potential of effectively handling large volumes of data. Deriving real-time and sophisticated insights from complex unstructured datasets can help support better financial analysis, planning and provide real time insights to the leaders for timely decision making. But before you get to that stage there are questions to be asked and you need to start at the baseline – what do you do with legacy and investments that were made in the past? How do you make sure what was relevant in the past (e g single instance ERP systems, or ‘best of breed’ IT procurement strategies; bespoke systems development, or ‘vanilla’ approach to solving business challenges) still remains to be relevant to your business in the future, and what needs changing.
Mobile technology is no longer a nice-to-have, particularly in the world of finance. Mobile technology is embedded into the processes and structures of reporting, analytics and approval workflows from travel expenses to contract approvals. Thus it helps the finance department provide better, more accessible, timely and user friendly support for operational decision makers as well as to themselves – for example, by enabling remote access to information regardless where you are in the world. Mobile technology can help bring much-needed finance systems and capabilities to every part of an organisation, even more to non-finance people.
Management loves the thought of cost-saving, and cloud computing is a proven technology that can lower technology costs through, for example, reducing IT hardware investments and maintenance spending. It can also free up more financial resources for those higher-value analytical tasks.
CFOs who understand the value of the Cloud and provide support in defining the roadmap how and when the companies are ready to transition, are invaluable to the future of their companies. They will be expected to provide solutions, scenarios and financial guidance for how the business will benefit from such transition in a short and long term.
So in essence, a CFO needs to be a financial expert, business strategist, leader, communicator and technology evangelist. Many might suggest that such a mix of skills would make the ideal candidate to be the next CEO. And there’s nothing wrong with that.
Lena Shishkina, CFO, SAP UK & Ireland