Kevin Craig is managing director, Concur Canada.
Technology has created an ever-changing business world, and businesses leaders must adapt to stay relevant and successful. This trend has become ever-apparent for CFOs, as many begin a greater focus on strategy and take a broader approach to business leadership, effectively stepping into a similar role to the CEO.
By 2013, several surveys showed that CFOs were quickly becoming more integral to every part of the business. One survey by Consero found that 92 per cent of CFOs were actively involved in decisions relating to their company's investment in emerging technologies. According to Forbes, three-quarters of CEOs from high-performing companies believe the CFO's role will grow more in importance than any other C-suite role.
While this is great news for CFOs who can present new and effective strategies for business management and ensure that key business decisions are made with a company's finances in mind, this is a relatively new shift in responsibility that presents its own challenges. This broader scope puts more pressure on CFOs to understand every aspect of the business beyond just the finances. It's now essential for CFOs to understand broad business functions including sales, recruitment and hiring, production and marketing – just to name a few.
I spoke on this topic at FEI Canada Conference, a gathering for senior financial executives, in June this year and discussed how financial leaders could navigate these new responsibilities in a changing business environment. To succeed, CFOs must demonstrate the ability to turn data into information, and information into insights – but it doesn't stop there. They need to be able to understand and present the information in ways that help a business make smarter decisions, faster, while tapping into trends that are most relevant to the organization and industry. It's no easy feat.
Insights and decision-making have become even more important for CFOs following the global financial crisis. Risk management has become a significant part of the role, but too much focus on compliance at the expense of innovation diminishes a CFO's ability to add value.
So, now a CFO has to manage information, gain insights, make quick, yet strategic, decisions and diminish risk – all while keeping innovation top of mind. CFOs will not be able to succeed unless they can harness the power of automation technology. Solutions such as finance-management automation technologies help CFOs forecast cash flow accurately, integrate data into intuitive systems and gain deeper visibility into finance. These solutions have compliance features that enable organizations to manage their risk profile effectively, ultimately saving money while improving productivity – and they've never been more important to the finance function than they are now.
While automation technology may seem like a no-brainer, CFOs face barriers to introducing these new technologies . For example, Concur research shows that 43 per cent of companies are still tracking all their expenses manually, and 23 per cent have yet to consider automation within their finance department. Many organizations are leashed to legacy mindsets and reluctant to give up methods that "have always been done."
It's imperative that CFOs work collaboratively across a variety of internal and external stakeholders to get buy-in at all stages of adopting these tools. Often, employees are resistant to change, but collaboration across the organization can help mitigate any headaches.
Fortunately, CFOs have an ace up their proverbial sleeve with the rise of cloud technology solutions. The cloud lets organizations move faster, try more solutions and options with less risk, and find new ways to compete. The cloud-based nature of these solutions, from a financial standpoint, means remote workers can book travel, approve invoices and submit expenses from wherever they are, eliminating the end-of-month rush. These systems can also help reduce the risk of fraud by setting up policies and rules that can't be circumvented. When integrated on a single platform, these tools provide a whole new dimension of data, which can be easily analyzed to show spending patterns and potentially fraudulent activity faster, letting CFOs act sooner.
Ultimately, cloud-based solutions are the key to allowing CFOs to take on the evolving role they are expected to fill. With emerging technologies and increased automation helping to remove much of the mechanical burden placed on a CFO, these business leaders are free to concentrate on adding value in the form of creative innovation and strategic direction to continue moving their business forward.
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