The modern CFO is a strategic enabler, digital innovator and the CEO’s most trusted advisor, finds Accenture’s research into CFOs. The 2018 survey of more than 700 CFOs and senior finance executives found that CFOs are consciously transitioning from back office duties to front line drivers of growth. Simply reporting on the past is no longer enough. CFOs are harnessing data better than ever before to offer forward looking insights and predict the future.
The role of value-adder is not without its challenges. CFOs continue to need to build the case for enterprise-level adoption of automation; they need to ‘own the data agenda’ and provide insight and guidance across the business; and they must develop the future finance professionals who will guide the business through its next stage of evolution.
Accenture’s research highlights five ways CFOs can fulfil their strategic leadership role:
Continue to automate
CFOs are increasingly automating transactional type activities (payments, receipts, cash management) in a concerted effort to reduce costs, improve productivity and free up people for higher value work such as analysing and trend spotting. Still, Accenture estimates that only 34 percent of finance tasks are automated, despite the opportunity to automate 60-80 percent of backward-looking accounting activity.
76% of CFOs say automation will allow their teams to provide more and better insight to the rest of the business.
As one survey respondent noted: “Low value-added activities which can be done by technology have to be done by technology...there is relentless pressure to reduce cost and do things in the most productive manner.”
Lead digitisation efforts
Not content with digitising their own function, 77 percent of CFOs are heading up the digital adoption agenda across the business. With a bird’s eye view of the whole enterprise, CFOs are uniquely positioned and well trained to look at processes, costs and apply a diagnostic lens to fix issues. As one CFO in a manufacturing business noted: “Who else but finance should be evaluating and prioritising investments in digital technologies? Who else understands the systems end-to-end?”
77% of CFOs believe it is within their scope to drive business-wide operational transformation.
Creating new revenue streams and reducing total costs are expected by-products of a business-wide digital transformation, which is why CFOs are natural drivers of this process.
Insights vs. ReportingBusinesses are increasingly demanding more insights from the finance team. “In virtually every company we look at, the CFO is becoming the second most important C-suite executive, sitting at the right hand of the CEO and articulating a story about the financial results they expect to realise,” says David Axson, Senior Strategy Executive Principal, Accenture CFO Strategies and CFO & Enterprise Value, UKI.
Predictive analytics are helping CFOs better understand cash flows, and steer the business away from risks and towards opportunities. Seventy six percent of CFOs agree that the business should have “one version of truth” across all units to avoid the problem of their people wrongly interpreting data extracted from different sources. With a bird’s eye view on the data, CFOs are helping business units identify greater productivity opportunities and even create fresh business models.
81% of CFOs see identifying and targeting areas of new value across the business as one of their main responsibilities.
Two thirds of finance leaders believe they have a role to train non-finance leaders within the business to understand routine finance activities, empowering them to undertake planning, budgeting and forecasting activities in their departments with confidence. Via tools, knowledge sharing and expert advice, CFOs are helping others to ‘self-serve’ and make better decisions. More than a gatekeeper or approver, the CFO is a trusted advisor and collaborator.
78% of CFOs believe that digitisation will facilitate a rise in self-service.
Empowering others means that CFOs free up their time to offer more strategic planning services. Said one CFO survey respondent: “What finance is doing more of, is sitting side by side with the folks running the business as they face their different challenges, truly understanding the tactical and strategic things they are working on and advising them on what will help them better achieve their short-term and long-term objectives.”
Develop talent poolThe expanded role of the CFO in a digital age creates a new skill set required to undertake a varied role. Current CFOs need to change their hiring and development criteria to reflect the innovation agenda of the modern CFO.
Accenture reports the top five skills for new-age CFOs are:
- Long term strategic thinking
- Identifying, anticipating and managing risk
- Understanding new technologies
- Talent acquisition and retention
- Agile and responsive ways of working
Finance professionals entering the field are optimistic about the possibilities. Automation of dull and mundane tasks, richer datasets and deployment of advanced visualisation tools are exciting to junior finance practitioners starting out.
Source: CFO Reimagined I Accenture