The role of the CFO has evolved. CFO 1.0 was a historian of past performance. CFO 2.0 was a real-time analyst. Our research reveals a radical new remit for finance decision makers as drivers of strategic change and visionaries of the future. This is CFO 3.0.
Technology may be the enabler driving this change, but the extent to which it transforms a business lies with those who are bold enough to take the lead.
Do you have what it takes to be a CFO 3.0? Take the CFO 3.0 challenge to reveal the key findings from our research and discover if you can truly call yourself a visionary.
It’s clear that the modern CFO will need to be versatile—marrying accounting, analytical, business and strategic-thinking skills into one package.
It will be a rare combination, but the job is no longer just about number crunching. Armed with powerful data, CFOs are poised to be agents for change. Data provides the tools behind accurate analysis and swift and responsible decision making.
The evolution of the CFO means many finance professional now have an integral role in data governance, data flow and cybersecurity, for example. This leads to more performance analysis and innovating the business model. This new remit will become key to unearthing new commercial opportunities.
Harnessing technology to delivering data-driven insights is a worry that keeps some financial decision-makers awake at night and many see their tech skills as being vital to future success.
However, some finance professionals are already concerned about their level of skill when it comes to using digital technology. It’s clear that the digitisation skills gap is felt keenly among finance professionals, especially with their enhanced responsibilities.
Charting the evolution of the CFO
CFO 1.0: The historian
CFO 1.0 is a historian of past performance. As strong individual with high financial acumen, this role reflects the traditional view of the finance professional as a historian of company financial data and past performance.
While there is still a place for traditional skills, forward-thinking CFOs need to spot issues and make decisions in real-time and predict the future, aided by data and technology.
CFO 2.0: The real-time analyst
CFO 2.0 uses real-time data and dashboards to provide the support and analysis that helps a business improve operational and management performance. While CFO 1.0 can tell their colleagues what happened, CFO 2.0 can add the “why” and help the organisation use data to gain critical strategic insights.
And while CFO 2.0 can catch issues as they occur, they can’t accurately see where these issues are happening ahead of time.
CFO 3.0: The visionary
Our research reveals a radical new remit for finance decision-makers as drivers of strategic change and visionaries of the future.
We are in the age of CFO 3.0 – a new breed of trailblazing finance leaders who use data and emerging technology to create a vision for the future of the business and who are often in the driving seat of digital transformation. Instead of just using a rear-view mirror, data and predictive analytics allow them to look ahead and plot a new direction, making them one of the most valuable members of the C-suite.
Your journey to CFO 3.0
Whether you are already embracing emerging technology and driving digital transformation in your organisation, or you’re at the start of your journey to evolve from CFO 1.0, there are a couple of steps you can take.
Start by assessing your finance function and focus on dealing with risk management, getting up to speed with digital transformation and ensuring the team undergoes ongoing training. Then look at technology literacy skills – they are essential to the future of an effective finance department. It’s worth pointing out that, as our research demonstrates, more than two-thirds of CFOs still make decisions based on gut feel.
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.
Leading a finance team to achieve its new function
As a finance leader looking to run your function effectively, you need to ensure your team is aware of its changing role. Crunching the numbers still has a place – and remember, automation can help with this – but so does the role of analysing and interpreting data to make key business decisions.
The finance team is there to evolve the business and it’s your role to look beyond the traditional boundaries of the function and make the sort of impact that drives the company forward.
By combining analytics, digitisation and the right blend of personal skills, you can make that a reality.
Recommended Next Read
How finance teams can say goodbye to manual processes and hello to automation
CFO 3.0 Digital Transformation Guide
Discover how CFOs are playing a key role in leading the digitalisation of medium-sized businesses and learn how to move from a 'historian' to a 'visionary' within your business.