The days when a chief financial officer, or CFO, could focus solely on safeguarding assets, reporting and forecasting are over. Tarek Meliti of IT services company TDM Group assesses the evolution of the role.
Digital transformation is experiencing a major evolution globally as a result of advances in technology. Digital disruption through automation, including chatbots, artificial intelligence (AI) and machine learning, is creating a significant impact on C-suite professionals, such as the chief financial officer (CFO).
The era of CFOs focusing exclusively on processes such as safeguarding assets, financial reporting and forecasting are over. Nowadays, the modern CFO needs to be equipped with a full arsenal of skills – from finance to technology – while simultaneously understanding the full scope of the business at all times.
As the core financial duties of the role remain undisturbed, we must now examine how this ever-evolving role has changed.
Traditionally, CFOs were entrusted with ensuring the company financials were all above board and ticking over smoothly. Today, finance functions such as credit management and payroll are largely automated. This requires CFOs to be more engaged with tech services and offerings than ever before.
The modern CFO cannot afford to isolate themselves and focus on crunching the numbers. Some CFOs may worry that the changing face of their responsibilities will make their beloved roles redundant in years to come. However, they need not worry as the role of the CFO will continue to evolve over time, instead of being permanently shelved.
Faced with an uncertain and unstable economy, it is crucial for CFOs to harness technologies that support the business and their day-to-day roles – particularly data-focused applications and AI – to ensure they are making the right decisions.
By combining the benefits of financial technologies, such as intelligence and speed, CFOs can free up their time and enhance their business strategy through the latest tech offerings. Take credit management systems, for example: CFOs who can identify and utilise the latest offerings are likely to reduce risk of late payments, improve cash flow and reduce debtor days. Streamlining finance processes via technologies will not only reduce risk, it also provides a seamless experience in comparison with a traditional credit controller.
As core members of the C-suite, CFOs must lead by example. In the past, they were mostly reactive in terms of financial results and forecasts. In contrast, today’s CFOs must be proactive when it comes to emerging opportunities.
This awareness, typically dedicated to financial results, must now be applied to technology, and how emerging technologies or the latest offerings can help achieve business success.
Traditionally, the CFO, as part of a team, has been expected to identify the latest technology, which is either emerging or currently available, to assist their business. Therefore, CFOs must be aware of the latest cutting-edge technologies to help drive their business forward – from blockchain-enabled verification tools and cloud-based credit management platforms to the best form of coding language for the business.
The past year has forced the process of digital transformation to increase at a pace never seen before. Therefore, CFOs cannot afford to be caught with their head in the sand when it comes to the latest technologies. Why? Because competitors are already discussing, if not investing, in these technologies to help drive their digital transformation into the post-pandemic world.
Meeting the digital transformation challenge
The advancement in digital technology has presented an unparalleled challenge for the modern CFO to embrace and adapt when it comes to the latest technology. Historically, digital transformation occurs naturally with no real key driving factor. However, the Covid-19 pandemic has torn up the rule book, forcing organisations to review their working models, resulting in businesses being more equipped and prepared for the future. C-Suite professionals, including CFOs, have begun to learn the key value and importance of technology moving forward.
The role of the CFO has evolved at a very rapid pace in recent years and will continue to accelerate in the years to come – and beyond. CFOs will continue to play a critical role in driving their business forward, with digital transformation at the forefront.
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