CFOs embrace technology and risk to drive strategy. They should look ahead and establish their transformational priorities for 2015 and beyond. By Aarti Takoordeen
The role of CFOs is ever evolving as they become more influential and crucial strategic business partners. As a consequence of globalisation, advanced technology and dynamic regulation, business faces competitive threats like never before. This puts business leaders under significant pressure to reduce costs and increase profits and therefore growth. CFOs are considered key roleplayers in the enablement of such growth. Yet the finance function has a myriad of challenges it must overcome before CFOs secure success.
It is a simple matter of transforming or be transformed.
It is important for CFOs to look ahead and establish their transformational priorities for 2015 and beyond.
SIMPLIFY THE MONTH-END, AND YEAR-END, CLOSE
Shift the focus to interpreting the close and results reports as opposed to executing the close and producing reports. This can be done by adopting a proactive approach and treating every month end as a year end, which results in finance team members getting closer to the business and eliminating the risk of surprises at crunch time. Implementing formal and regular reviews introduces structure and managing these to timetable deliverables creates efficiency and improves team cohesion.
EMBRACING DIGITISATION FOR GROWTH AND RISK MANAGEMENT
The digital revolution and accompanying opportunities to automate accounting processes, can reduce human errors and speed up the execution of traditional finance responsibilities. Technology allows for working smarter and not harder. Harnessing big data poses unparalleled opportunities to create, retain and share commercial intelligence.
PARTNERING WITH THE BUSINESS
The finance function can combine business knowledge and sophisticated financial acumen with hard statistics in order to influence sound business decision-making. Thanks in part to digitisation, we can move away from reporting on lagging indicators to driving change to contextualising leading indicators and providing valuable insight. Consulting historical statistics is important, however: we need to provide the platform actively to plan or forecast for the future.
A typical business requirement is that the finance function is seen as a growth enabler and not an inhibitor of growth. It is an art to balancing out our compliance role with our enablement role. Enter the need for effective influencing skills about spending behaviour and cost efficiency, contribution to strategic discussions with insight such as optimal or alternate commercial or operating models. We also need to build relationships so as to be viewed as a trusted business partner.
PUTTING PEOPLE AT THE HEART OF THE NUMBERS
The information age has reached an inflection point. Yet again, we experience a storm brewing that will change society and industries. As we enter a new communication age which hinges off social and relationship interaction, our response must be a focus on relationship building and management.
The new partnerships CFOs must form within their businesses and their more outward facing role means that the role requires a more rounded skills set. CFOs are no longer stern faces in grey suits. They are now armed with emotional intelligence, sound leadership and management skills, which has shifted the focus to executing corporate strategy.
The future looks bright for finance, especially for those of us who are willing to embrace change and innovation.
Author: Aarti Takoordeen CA(SA) is the CFO of the JSE