Business is evolving. Technology, customer expectations, the roles your employees play and the workplace tools you use have all transformed. There’s no turning back.
In finance and accounting, you’re seeing the impact of artificial intelligence (AI) and automation to enhance connections between customers and employees.https://www.sage.com/en-ca/blog/wp-admin/post.php?post=6824&action=edit#
Today’s financial departments have technology that allows them to become highly tuned time machines, which can streak forward and back through a wealth of data at a moment’s notice.
With the evolution of accounting and finance has come the evolution of the CFO.
The early CFO, or CFO 1.0, was the historian. Next came CFO 2.0 – the real-time analyst who could catch issues with real-time dashboards.
But now is the opportunity to become CFO 3.0 – a leader who can see into the future.
You will be familiar with using a rear-view mirror to provide business information – looking behind yourself while attempting to steer forward. With data and predictive analytics, you can understand data to look ahead.
The role of digital transformation
Driven by new technology such as the cloud and automation, combined with increasing customer expectations, your business needs the right technology foundation to undergo digital transformation, where tech is integrated and co-ordinated across the entire business ecosystem.
In growing businesses, the first investments are often made in financial management, building out the technology you as a CFO will need for success.
However, this also means the business requires you to be front and center when it comes to leading change through digital transformation.
This puts you in the ideal position to evolve from CFO 1.0 and CFO 2.0 to CFO 3.0.
You can put what you need in place to move beyond your traditional role and lead your business to new heights – you may end up driving business transformation beyond finance boundaries.
CFO 3.0 means you’re the visionary.
While today you’re focused on the past and present, tomorrow you’ll need to make use of vast amounts of data that is available in our digitized world. This will help you predict the future of your business, uncover hidden opportunities and close information gaps.
According to a new piece of research by Sage, where 300 senior in-house financial decision makers from Canada were surveyed, that shift is already happening.
The report, CFO 3.0: Digital transformation beyond financial management, revealed that almost three quarters of financial leaders (70%) now have a hand in driving digital transformation.
Download your free copy of CFO 3.0: Digital transformation beyond financial management
How is the finance function changing?
It’s no surprise that recent research from Sage, has revealed that in Canada’s data-driven business environment financial leaders cite adapting to the changing job role; and modernizing business processes with technology as the two biggest challenges facing their profession.
To achieve top-level visibility of business performance, your finance teams must have the right digital tools and flexibility to use them. Only then can you dovetail with the other sides of business and collaborate for growth.
Continuous investment in modernization and digitization means you can have advanced analytics to improve decision-making, metrics for real-time financial information, and the insight you need into your operations to uncover growth opportunities.
Challenges that CFOs and finance leaders face
Of course, owning the digitization journey and becoming the data gatekeeper is a big responsibility. This means the role of the CFO role is expanding.
As well as data and technology, you need to manage employee and stakeholder expectations.
Embrace this responsibility and you can boost the whole business. A failure to grasp the opportunity leaves you at risk of being overtaken by competitors.
To deliver data-driven insights, you’re going to need to upskill your team. More than half (57%) of senior financial leaders see digital-first skills as integral to the future of finance, but are concerned on how to find and retain the right talent with those skills in the next generation of financial professionals. 69% – of financial leaders cite finding, retaining and growing the right talent as a major concern.
Even though there is an obvious awareness among respondents of the skills gap that must be bridged, there is still a perception that data driven processes and digital skills are only valuable to the next generation of financial professionals. As such, 60% of CFOs and senior financial leaders believe that cloud technology is only for millennials.
Furthermore, even though 57% of senior financial leaders see digital-first skills as integral to the future of finance; 64% considered learning new skills or systems one of the biggest reasons to not implement cloud-based services.
Gatekeepers of data
As guardians of data, fraud, cyber misuse and data privacy are increasingly falling under your remit, and that of the finance department.
While this sounds like more work, remember that emerging technology can decrease the risk of data breaches – the cloud, for example, can enhance levels of verification and secure data in a more comprehensive way.
Cybersecurity is also a frequently cited concern amongst CFOs and senior financial decision makers for adopting new technologies. Almost three quarters of financial leaders (74%) see data risks, including fraud and cyber threats, as one of the biggest challenges facing the profession.
You should look at skills training, whether it’s for you or other members of your team.
The changing dynamics of your job mean you need to keep learning to have the business, analytical and data skills you and your team require.
How automation is making an impact
New technology can drive improvements in efficiency. And naturally in the process of leading digital change, you will need to invest in the right financial management platform to move money and data within your business.
It’s here where automation can cut the hours you spend each week on collecting and preparing data.
It shifts the burden of dealing with onerous, repetitive and simple tasks from you and your finance team to machines, which will help to ensure increased efficiency and quality.
The automation of routine, tactical tasks has become a new reality for many companies. In fact, most financial leaders in Canada (90%) have already begun automating processes to drive efficiencies, and even more (93%), say that automation has positively improved productivity.
Conversely, these same leaders also feel they need to take a staggered approach to automating additional processes. While the benefits to automation from a productivity standpoint is evident, 88% of CFOs still feel their workforce isn’t ready for additional automation.
Beyond benefiting your finance department, it can also lay a foundation for the better use of critical data and insights across the business.
Conclusion on CFO 3.0
Technology can help you build a finance function that can withstand future challenges.
You’ll need to lead your finance department in a world awash with data, so focus on honing management processes though data flow, data governance and analytical insight.
There’s no getting away from the challenges.
CFOs who actively shape their organization’s data strategy, can better derive insights from the data and their systems, and in turn make the most of the technologies designed to support the finance function and the business.
With technology to support your endeavours, you have the space to become a CFO 3.0 – a visionary who can uncover the hidden opportunities and close gaps through data and insights.
With that in mind, you can embrace your role in delivering and shaping the strategy of your business through digital transformation, something that’s much more rewarding than simply being seen as the person pulling the company’s numbers together.