Five Forces Reshaping the Role of the Modern CFO
The CFO has expanded beyond just being the face of the financial division of a company. See how the role has changed in the modern technological era.
Today’s business leaders are looking toward organizational transformation to find new, innovative ways to turn insights into action. Who is best positioned to help them lead the charge? The CFO.
Why the CFO?
Because modern CFOs are the steward of the greatest amount and most critical corporate data, they are at the fulcrum of decision-making in the face of changing customer needs and new competitive threats. The CFO is the ‘economic guardian’ – the person who is there to provide insight, direction, and measurement of business outcomes.
Technology can enable the CFO to both access and translate all that data into insights which in turn empowers strategic decision making to drive business outcomes. Ultimately, “We see the CFO as the right hand of the CEO in helping to make sure that strategy is enabled in a way that gets to an outcome that analysts, peers, and investors can measure and understand,” said Steve Culp, Senior Managing Director of Accenture’s CFO and Enterprise Value Function, speaking at this year’s CFO Rising conference in London.
Since 2003, Accenture has been looking at how the role of the CFO has changed with trend analysis and insight on how they can be more effective with CFO technology. In conducting research for its most recent CFO study, the consultancy spoke with more than 700 CFOs across the globe and 200 up-and-coming nextgeneration CFOs.
Accenture found five forces changing the role of the CFO:
1. Increased expectations
The role of the CFO is moving from the bottom line to front line. CFOs are now being asked to work more closely with the business, external analysts and customers – it’s no longer simply a focus on the monthly close. CFO’s are collaborators across stakeholders, and as such have a much more strategic role in today’s companies.
2. The pace of change driving decision making
It’s hard to imagine a world without mobile devices and connectivity – the pace and flow of data communications has exploded and only continues to increase. This has also driven an increase in the rate of innovation and change across markets. The next five years are likely to include more change than there was in the last 30 – that’s a real challenge for the CFO. There’s a strong imperative for action as those who wait to make key decisions will rapidly be left behind.
3. Control and compliance
In response to the occurrence of one financial crisis after another, a great deal of time and attention has been spent on the regulatory agenda over the past ten years. This has led to increased compliance requirements for businesses. Today more than ever, it’s not just about money and profit – businesses must service customers with embedded regulatory controls – these aren’t separate agendas. Five Forces Reshaping the Role of the Modern CFO
4. The power of data
An increase in the volume of data requires new focus and capabilities. Digital technology now empowers CFOs to shape strategy through higher-level thinking made possible by insights gained from data results. Therefore, a key function of the CFO both now and in the future is to translate that data into insights that support decision-making and the strategic direction of the business.
5. Driving results
It’s always been the case for CFOs that there’s a pressure to show growth and profit. In challenging business times, this often requires new, innovative thinking. Doing more of the same won’t drive the kind of growth that is now demanded.