Amid changing trends in technology, finance, and business strategy, smart CFOs need to sharpen their operational toolkits or risk being swept away.
“The only thing that has remained constant over the past three to five years is change.” Amy WangCFO procuretold PYMNTS of the series:A day in the life of a CFO”
“Gone are the days when you put in capital and high growth happens. Everything needs to be very intentional, ROI-focused, and longevity as a north star,” Wang added.
In the past, CFOs were primarily concerned with the financial health of an organization and focused on tasks such as bookkeeping, financial reporting, and compliance. Today's CFO must juggle an increasing set of responsibilities, including strategic planning, data analysis, and even overseeing digital transformation efforts.
That's because, from the impact of the COVID-19 pandemic to the constant search for top talent to navigating a challenging funding market, adaptability has become paramount. .
Still, “the fundamentals of people, processes and systems remain largely the same,” Wang explained. “Everything becomes a little more streamlined, efficient and effective.”
“We are still building for scale, but we are scaling with technology and leaning toward automation rather than scaling with employee numbers, which is what we have traditionally done as financial organizations,” she added.
The basics remain the same, but the strategic approach evolves
One of the key factors driving the transformation of the CFO role is digital technology. CFOs are increasingly involved in decisions about investing in technology and digital capabilities that can improve efficiency, improve the customer experience, and create new revenue streams.
This requires CFOs and aspiring CFOs to not only have a deep understanding of financial principles, but also a firm grasp of technology trends and their potential impact on the business.
“If you look back, hiring senior accountants and accountants was very traditional. …But now… there's a lot of focus on how we leverage data. Do you understand the flow from a finance perspective of how do you report things and how do you ultimately make that available to the rest of the organization? So, how do you understand the flow from a finance perspective, how do you report things and how do you ultimately deliver that to the rest of the organization? How do you utilize it?'' Wang explained.
“The added value that finance departments are bringing today has more to do with analytics and insight than just being the person holding the purse strings,” she added.
Additionally, the proliferation of big data and advanced analytical tools has given CFOs access to a wealth of information to make strategic business decisions.
“I would say the financial industry has always been slow to adopt new tools and technologies. … We've been stuck in our processes and historical ways of doing things,” Wang said. “But now the expectation, not only at the executive level but also at the board level, is to get real results.
“And technology can help you proactively approach what's going on, rather than reactive or delayed metrics. It also allows you to use leading indicators to guide you as a company as needed. You can pivot, you can course correct, you can double down.”
Setting the strategic agenda
The traditional mantra of growth at all costs is being replaced by a more nuanced approach focused on intentional and sustainable growth. Mr. Wang reiterated the importance of ROI-driven investments and strategic planning in today's environment, urging CFOs to balance growth aspirations with financial prudence and ensure investments align with long-term goals. He emphasized that there is a mission to ensure that
To her fellow CFOs facing today's challenges, she reminded them of the importance of resilience and adaptability. Companies that stick to their guns and believe in their product's value proposition, even in the face of market unpredictability, succeed. Difficult times present opportunities for innovation and improvement, which will foster sustainable growth in the long term, Wang explained.
Looking ahead, Wang emphasized the importance of embracing digital transformation in the CFO role. As technology continues to reshape the finance function, CFOs must drive innovation and lead the way towards digitalization. By harnessing the power of artificial intelligence (AI) and technology, CFOs can realize new efficiencies and drive sustainable growth in a rapidly evolving landscape.
