Chris Stock examines how the role of the CFO has changed and the vital part that technology has to play in the role’s continued evolution.
The very nature of business has changed and continues to change on a daily basis. We’re all operating in a faster, more dynamic marketplace, where business agility is key for continued success. Underpinning this agility is digitisation. With the right application of technology and digital processes across a business laying the foundations for the creation of a flexible, agile business, very much fit-for-purpose in our digital economy.
When it comes to digitisation, the majority of new businesses hit the ground running, with digital practices and technology embedded right across the business from day one. For older, more established businesses, it’s often a case of playing catch-up, not only changing the way they do business, but changing the key roles within the business to lead the digital way. Nowhere is this more true than with the role of the CFO.
The New CFO
Sage has given the latest version of a CFO a name, calling it the CFO 3.0. This new role involves the transformation of the CFO into a strategic visionary at the very heart of an organisation. So, what has led to this and how can businesses help their CFOs develop to ensure they fulfil all the responsibilities that the role of a CFO 3.0 entails?
Historically, the CFO has been viewed as a guardian of the past, looking back at data from across the business to crunch the numbers and create reports on financial performance. Technological advancements have enabled the role to evolve into that of a data analyst. Moving away from merely reporting on figures, with access to real-time information and the ability to interpret this real-time data, enabling the CFO to add more value to the business, increasing business agility and responsiveness too.
The new CFO 3.0 takes this even further, using real-time information and the available technology to become a business visionary, informing strategic direction with accurate, precise forecasts that are firmly rooted in comprehensive, robust data and insight gathered from right across the business.
Without a doubt, digitisation is driving this evolution, furnishing the CFO with not only the right information but the right tools to derive optimum levels of business value from the increasing amounts of data generated by businesses today.
Key to this transition is how the application of new and emerging technologies brings in-depth levels of financial insight and analysis, supporting rapid, effective and, most importantly, strategic decision-making. For many organisations, the solutions are already in place to pull together real-time financial information from across the business, as well as amalgamating information from every business function to provide a comprehensive view of the here-and-now.
But, the real value is added with the application of AI, increased automation and predictive analytics. Letting the technology take care of the data input and processing, and giving the CFO the tools necessary to establish a culture of data analysis, with all eyes firmly set on the future direction of the business.
Next Level Finance
It’s this addition of new technology as part of a wider digitisation process that has enabled the CFO to grow the role, taking the finance function as a whole to the next level and giving the entire C-level team the focus and insight needed to revolutionise the way the entire business operates.
Whereas in the past CFOs may have relied to a certain extent on gut instinct or previous experience to interpret figures and understand what they mean for the business, this access to enabling technologies has altered the dynamics of decision-making, putting concrete facts and accurate predictions in the CFO’s hands to steer the business in the right direction.
Its those businesses who continue to invest in the right technologies, at the right time who will benefit most from the evolution of the CFO into a CFO 3.0. Reaping the rewards that only a forward-thinking, digitised finance function and CFO can bring.
Not only is the CFO 3.0 now taking the helm when it comes to determining the organisation’s direction, but this role as visionary leader is helping to instill a fundamentally financial approach throughout the organisations.
The levels of insight that technology can uncover optimise operations, grounding crucial business decisions in solid, factual foundations and fostering a culture of rapid response decision-making, helping to shape the strategic agenda of the business.
Where finance professionals used to look in the rear-view mirror for their information, now they’re very much focussed on what’s ahead, finding the optimum route to take in an increasingly hard to navigate business landscape.
Get In Touch
If you would like to know more about Percipient or would like to discuss how we can help digitise your finance function, get in touch or call us on 01606 871332.