Finance professionals have an increasingly vital role to play in business transformation, value creation, and sustainability.
This was the overall theme that emerged at Finance Indaba 2022, where technology and finance experts discussed everything from talent, climate, and sustainability to data storytelling, supply chain management, and the digitally-led customer.
Here are some of the top insights that came out of the continent’s biggest finance conference and networking event.
Storytelling: A crucial skill for finance leaders
In a panel discussion titled ‘Finance skills of the future: Not all about finance’, experts said finance leaders need to be open to continuous learning throughout their careers.
The finance function used to be a separate operation in business, with finance teams looking at the numbers in isolation. But finance is now at the heart of any business, which means CFOs need to be able to see the bigger picture—i.e., a helicopter view—and become part of the business growth conversation.
Besides embracing digital tools, machine learning, and artificial intelligence to yield actionable data, finance professionals should start thinking of themselves as business co-pilots—or as bean-growers rather than bean-counters, as Mohammed Shaikh from Deloitte puts it.
Finance leaders need to be more engaged with executives to determine where the business is and where it’s going. This way, they can secure buy-in from top management, help the business to manage inevitable change more effectively, and capitalise on their teams’ strengths.
One way to do this is for CFOs to build strong, trust-based relationships between teams, stakeholders, exco, and clients by breaking down information barriers and using the figures they work with to tell a story and encourage better communication and understanding. Through stories, CFOs can connect different departments and their skill sets in pursuit of a common goal and shared objectives.
“The ability to influence is a powerful skill,” said Mohammed, “and this needs to be combined with effective storytelling.”
Peterjohn Bishop, Vice President of Sage Africa and Middle East, noted that storytelling is not just about sharing figures—that’s commentary. Through storytelling, finance leaders must establish what the figures mean and convey the key messages effectively. “We need to look at story-selling as opposed to storytelling,” he said. And this requires a re-education around the role of the CFO.
Essentially, financial storytelling is the ability to narrate, for example, a change in profit from X to Y, with rich insights that answer the questions ‘why?’ and ‘what now?’. It’s not enough to crunch and churn out the numbers. Finding the meaning in numbers is a mindset shift, and mastering this skill will enable CFOs to tell stories that get their businesses moving in the best possible direction.
For Craig Henery, CFO of DHL Express South Africa, to successfully develop this skillset, CFOs also need to establish their “why”. “It’s about connecting with your personal purpose, which your organisation should echo. Once you understand your ‘why’, your ‘how’ becomes much easier,” he said.
Finding your ‘why’ requires more self-awareness, more engaged learning, and a willingness to adopt innovations that enhance collaboration throughout the business.
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The magic of financial storytelling
Our Digital CFO research reported that 83% of financial decision-makers believe that business and accounting are much more complex than they were even a year ago, and 95% said they suffer from data overload and can’t make good decisions fast enough.
Today’s finance leaders must not only manage massive, never-ending streams of data but also make sense of it all—and, crucially, translate the numbers into strategic narratives. Finance professionals will rely increasingly on advanced analysis and reporting tools to make sense of the numbers and build a story around them.
Cloud-based software can provide CFOs and their teams with powerful data analysis tools to help them build strategic stories that resonate with the board.
Here are our top tips for financial storytelling:
- Detail the context: Context is about explaining why something is happening or why it’s important. For people to understand numbers and data, they need to be put into context. Finance professionals first need to know their audience’s pain points and problems. Then, they must use the information they have to tell a story that the people in the room will find especially interesting.
- Draw comparisons: Comparisons help you understand how a change can affect an outcome, for example, to illustrate the return on investment. Suppose the finance team opts to use cloud-based software instead of doing basic accounting jobs manually; in that case, it would be easy to tell a story about the success of this decision using data. A simple comparison of how much time it took to complete a task in each scenario will highlight the most efficient way of working.
- Identify trends: Insights rarely emerge from a single data point. You must bring different data points together to understand the information. Data trends indicate how something is changing or developing over time. When patterns emerge in data, these insights can be used for forecasting and planning how the business responds to and prepares for what lies ahead.
Straight A’s: How data-driven finance leaders deliver big results
Finance leaders can no longer afford to be without data and analytics. The digital economy has re-invented business, and the need for financial reporting visibility and data-driven insights has accelerated.
Speaking during a session titled ‘Unlocking real-time insight: Master your data and analytics’, Mohammed Mosam, Director of product marketing for Sage Africa, Middle East, and Asia, said CFOs need to get ‘straight A’s’ for data analytics:
- Accessibility: Stakeholders need instant access to data. This is facilitated when real-time information is published in the cloud in role-defined dashboards.
- Audience: The ability to present the right data points to the right people, for example, internal stakeholders versus external suppliers, is key to driving change.
- Arrangement: Reporting needs to be flexible in its presentation. Again, this depends on your audience and their information needs, which could be hard stats, a narrative dashboard, or a combination of the two.
Finance leaders can’t score ‘straight A’s’ if they’re still using spreadsheets, said Mohammed.
“How do you know if your data is trustworthy when there are multiple versions of the truth? Cloud-based solutions enable you to move beyond spreadsheets to give you a single version of the truth—no matter what format your data is in. From this verifiable state, you can do dimensional reporting, and deep-dive analysis—Excel can’t do that.”
From business partner to value partner: How CFOs can create value in a changing world
In a session titled ‘Beyond transactional reporting: How the next generation of finance will actively create value’, Leslie Marie from Workday said demands on finance professionals are increasing, and maintaining the agility to react to a changing world is increasingly challenging.
However, a solid data foundation combined with adaptable business processes can help organisations grow and empower finance professionals to shift from being business partners to becoming value partners.
To step into this role, CFOs need an adaptive and agile system that can help them leverage intangible assets, like social and intellectual capital, maximise shareholder value, achieve profitable revenue growth and ROI, and reduce costs.
According to Leslie, future finance professionals will need insight (to predict what will happen), adaptability (to help organisations quickly pivot to new opportunities), and the right talent (to grow the business while also driving value).
But this isn’t possible with fragmented data and systems and rigid processes and architecture. Instead, multiple data sources—from finance to HR—need to be connected and integrated into a single, secure, business-critical source that gives everyone access to the same version of the truth.
“Creating value is about democratising data access into a singular and seamless experience to support data-driven decision-making,” said Leslie.
With the right technology, CFOs can intelligently automate processes, detect anomalies, and make recommendations that help with forecasting—ultimately creating value for the business.
Strategies to deliver growth in uncertain times
Many businesses have faced extreme headwinds over the past few years, but some have still managed to deliver growth despite the challenges.
In a panel discussion, CFOs from Tiger Brands, Kumba Iron Ore, and Liberty Africa Insurance shared how they coped with volatility and how brands can thrive during uncertain times.
- Control the things you can: Tiger Brands Group CFO Deepa Sita said they focused on the things they could control, like cost management and eliminating waste in production. “When times are good, and you are riding the wave, you don’t really notice the wastage in an organisation,” said Deepa. To cope with supply chain uncertainty, Tiger Brands reviewed its logistics operations to achieve route-to-market optimisation. It also offered rebates to suppliers to manage revenue growth and looked at SKU rationalisation and promo optimisation.
- Pay attention to competitive footprints and global markets: Take note of what multinationals are doing when it comes to revenue growth management and adopt their practices for your own growth, says Deepa.
- Expand your product line: Liberty Africa Insurance achieved growth by creating more diverse and innovative products in Africa, said CFO Ravi Singh. “Africa is quite junior in terms of insurance, so it’s quite a challenge to sell insurance in this continent. We have used multiple platforms to teach people about financial literacy; we looked at how we can be innovative and change our cost structure.”
- Prioritise operational efficiency: Kumba Iron Ore CFO Bothwell Mazarura said his business was able to contain costs by efficiently removing waste.
- Optimise absolute costs: Look at your entire value chain and identify ways to optimise costs, advises Bothwell. “Nothing is too small; nothing is too big. You have to look across the value chain and look for opportunities.”
- Focus on product quality: When you operate in a global market, your competitive advantage lies in the quality of your product, says Bothwell. “Maximising the quality of our product through process optimisation is key because it allows us to earn a premium on the market and realise a higher price than our competitors.”