Throughout this period of disruption, the role of the chief finance officer (CFO) has experienced a critical and influential repositioning within the enterprise. CFOs now face greater expectations from boards, investors, regulatory agencies, CEOs, and other executives to deliver stronger financial results, insightful vision, and business partnerships.
Once focused largely on back-office responsibilities and static reporting, today’s CFO looks incredibly different from those of yesteryear and functions as a right-hand advisor to the CEO. An agile strategist, the CFO is now an agent of change and a catalyst for cross-functional collaboration that can drive growth and sustainability in periods of instability and uncertainty.
Let’s take a look at the elements sparking change for the modern CFO and the opportunities they have to remain agile in the years ahead.
Why CFOs have stepped out of the back-office shadows
What’s more, advancements in analytics—and the interconnectivity that all this progressive technology inherently brings—means that the focus of the CFO is influenced by other ongoing realities as well. Among others, here are three underlying factors that have contributed to the reinvention of the modern-day CFO.
- Surviving (and thriving) after the explosion of data. Data continues to tell a revolutionary story for finance: the volume, types, availability, and accessibility of data are critical to understanding the ebbs and flows of business performance. Infrastructure investments in large organizations have made data more usable over time to empower better analysis, insights, and decision-making—which rest on the shoulders of the CFO.
- Growing and winning new business. Amid volatile markets and unpredictable business environments, CFOs now face increasing pressure to show how their organizations will not just drive, but sustain, growth—whether it be top-line, bottom-line, or both. As a result, automation has become indispensable and CFOs must focus on value creation.
- It’s not always about finance, but it’s always about finance. Organizations increasingly recognize all decisions eventually roll into finance (teams) and everything has a profit and loss (P&L) impact. CFOs are modeling the business enterprise-wide to better evaluate various strategies, opportunities, and revenue streams while keeping an eye on total costs and returns.
How CFOs became an influential leader amid disruption
In fact, it’s these past, present, and future focuses of the CFO that make its current role so influential—and one of the reasons it has emboldened the CFO step out as a beacon of insight during the most turbulent of times.
Today’s CFO intuitively connects the applications of accounting and traditional finance with the principles of business partnering and strategic collaboration. In turn, the CFO is best primed to influence the organization to adopt agile operating models and make quick-yet-thoughtful decisions based on data-driven insights.
Where focus lies in the future
To remain agile now and in the future, CFOs must be able to:
- Automate foundational and transactional processes. Wherever possible, CFOs and corporate finance should focus on keeping it simple by automating as many processes as possible. Taking these critical steps to reduce manual inefficiencies helps the finance team improve productivity, analyze cleaner data, and better support profit and growth goals.
- Identify areas to drive value and spot trends. This can only be accomplished by using technology with flexible modeling capabilities. Used enterprise-wide, it allows the CFO to model various scenarios for comprehensive and strategic insights. This could include scenarios that are focused on investment opportunities, innovation and new product introduction, selling strategies and sales alignment, marketing investments and incentive programs, and efficiencies from the supply chain and workforce.
- Increase enterprise-wide partnership and collaboration. Connected Planning platforms play an integral role here. Our State of Connected Planning research revealed that nearly half of all finance professionals say that a collaborative platform—one that can be used by all functions and departments—would benefit their planning process.
As CFOs continue to leverage new opportunities through breakthrough automation and analytics, executing finance-led, Connected Planning will be key to agile and influential C-level leadership.