Why CFOs are equipped to pave the way for digital transformation

Over the last decade, Chief Financial Officers and finance leaders have become the CEO’s copilot, providing insights for value-enhancing decisions. With leadership and business acumen, CFOs have naturally grown into this role as they continue to optimize their traditional finance function and add non-finance initiatives to their responsibilities.

Once focused on the past with transaction management, the most valued finance leaders now help guide businesses into the future by focusing on growth. Instead of being reactive, finance leaders are becoming increasingly proactive as processes improve and more time is freed up for planning & analysis or encouraging innovation. With the help of technology, the modern day finance leader is broadening their impact on organizations, playing a bigger role in strategy.

CFO’s are more equipped than ever to pave the way for digital transformation. But what makes them so qualified?

CFO’s wear many hats 

The role of a CFO has evolved significantly, as well as the amount of responsibilities they own. From developing plans for growth and monitoring cash flow, CFO’s have taken on an active role in all areas of their companies, allowing them to grasp a deeper understanding of the current state of their business. 

In addition to speaking with department heads and investors, CFO’s can immerse themselves in the day to day activities of their employees across departments to gain better insight on what is currently working for their company and what can be improved. This insight can be used to identify tasks that are time consuming and tedious, which can allow a CFO to then seek out and implement new technologies that are more efficient. 

CFO’s understand market trends, evaluate risks and benefits of their current models, and  provide accurate and insightful data in order to drive growth for the future. With this skill set comes the ability to not only identify problems but present possible solutions.

According to PYMNTS recent study, one way CFO’s are doing this is through AP and AR modernization. About 93 percent of CFOs say they are currently digitizing their accounting operations in order to enhance the lifetime value. 

But even as CFO’s across the US actively pursue digital transformation, they are simultaneously maintaining their day to day responsibilities.

CFO’s live in the Unknown

“Sometimes when you have a crisis, sometimes you're able to drive change even more effectively and more significantly than you ever thought.” - James Miln, finance executive at Yelp

After being confronted with a global pandemic, CFOs were forced to adapt to the new and unpredictable circumstances their companies now face. From enterprise risk assessment to contingency plans, CFO’s are particularly experienced in working in the “unknown.” They have the ability to identify potential obstacles their company may face and craft informed and strategic plans on how to overcome them. 

In a recent CFO.com article, Steve McNally, CFO of Plastic Technologies Inc, urges other finance leaders to “adopt a “growth learning” mindset. Personally commit to learning about strategic planning best practices, industry trends, and the topics above. Likewise, provide the finance team the opportunity to upgrade their skills and knowledge.”  

A growth learning mindset also means being mindful of digital competencies when it comes to implementing new technologies such as accounting AI or chatbots and smart assistants. The incorporation of digital transformation strategy is the key to optimizing your accounting workflow as well as upgrading your finance team's skill set, ensuring that they too can navigate their way through the unknown. 

Though staying up to date with industry trends is almost table stakes at this point, taking action on every single trend once it becomes a trend could put companies far behind. Becoming an early adopter of a technology or way of thinking will put you in a better position for increasing competitive advantage. Yes, new technologies bring uncharted territory, but they can also pay off in the long-term with residual benefits you never expected.

Drive change with Top Insights for Finance Leaders in 2020

CFO’s are Visionaries 

While CFO's can’t necessarily see the future, they can assess, plan, and invest in it by seeking out digitization efforts and innovative technology such as autonomous AI and Machine learning.

CFO’s are encouraged to continue gathering modern, timely information and upskilling in order to navigate unprecedented scenarios and tackle business challenges. CFOs utilize information about their business’s financial performance and priorities in order to craft a vision that facilitates optimal performance and generates revenue. With a combination of expansive thinking and informed data, CFOs act as a conduit between finance and strategy, allowing them to make informed judgment calls for the future that will result in longevity, customer retention, and all around company success.

An article from BCG states, “When defining the vision for the finance function’s people and culture, new CFOs should adapt their plans according to these evolving norms to ensure that the vision is fit for the future.” 

With never ending uncertainty provided by the pandemic, the evolving norm has become an ever growing need in finance for advanced data analytic tools, workflow automation, and artificial intelligence technologies. 

According to Gartner's latest press release, IT spending will continue to grow in 2022 as the focus is on growing and scaling businesses. Gartner predicts that the worldwide IT spending in 2022 will expand by 5.1% in 2022 to drive growth and digitization.

Finance professionals have been underserved when it comes to technology innovation. As a result, growing companies that have developed large volumes of customers, accounts, and payments without digitization have paid the price, losing millions of dollars. CFOs have the foresight to see the bigger picture and determine not only what's next for their business, but what’s best for their financial futures. 

AI can be a game-changer for your firm and your clients, especially when it comes to the future of invoice processing. Requiring an executive to sort through each invoice can become tedious, costly, and more prone to errors than if you were to use an AI-driven system to handle all of the approvals for you. 

YOUR TOP 5 PRIORITIES TO SCALE AND MAXIMIZE GROWTH

Are you and your team bogged down by tedious processes with zero time to work strategically and take your company to the next level?  Business leaders face unique challenges as the global economy is impacted by supply chain disruptions to labor shortages.

When the going gets tough, the tough get going – this is the time to tackle the most critical issues. Stay ahead of your peers by downloading the exclusive playbook outlining the top insights for finance leaders.