As we head into Q2 of 2022, we are well into preparing for a post-pandemic world and reimagining what that can look like. For my own part, I’ve been reflecting on how the role of the CFO has changed, especially over the last two years, and how CFOs can leverage their newly-defined role to plan for a successful year ahead.
CFOs have traditionally focused on budget ownership and critical asset protection, but the pandemic required a radical reevaluation of conventional strategies. In fact, a 2021 Accenture study found that nearly three-quarters (72%) of CFOs are introducing non-traditional skills into the finance function, including business agility, analysis, value architecture and even storytelling.
As CFOs continue to address complex business challenges brought on by the pandemic, a more strategic approach and refined skill set is needed. These leaders must be more tactical, compassionate and digitally fluent than ever before, breaking down the traditional silos that once existed in their organizations, strengthening the role of the office of finance and planning for success despite an uncertain future.
CFOs today need to expand their skill set and must:
Be digitally fluent.
Digitalization has had and continues to have a significant impact on business, with new technologies evolving quickly to support an increasingly digital workforce. To remain competitive, it’s essential for CFOs and other leaders within the office of finance to be tech-literate and familiar with different platforms and optimization tools. As businesses increasingly prioritize digital transformation strategies, it’s crucial that internal teams understand how to use resources and have the executive support to onboard new products and services that will help achieve ROI and related revenue goals.
My team conducts an annual global survey, the Global Financial Close Benchmark Report, to learn from finance and accounting (F&A) professionals about what challenges and opportunities are most critical to them. In 2021, of the 486 financial professionals within 430 organizations who contributed, 46% ranked remote work as their top challenge, which was especially true among CFOs and their teams during the monthly close of the company’s books; 51% ranked meeting deadlines/time-pressures as their biggest challenge, reinforcing the stress felt by added workloads these past two years, as expectations around the quick delivery of critical business insights increased across the business.
Especially in this time of the Great Resignation, it’s never been more important for executive leadership to be receptive to feedback from their teams and implement the necessary changes to retain talent. A third of respondents in our 2021 benchmark report identified overtime/employee burnout as the biggest challenge companies will tackle over the next five years. CFOs must not only understand which technologies and adaptive workflows can help an organization’s bottom line, but also, (and equally) become a champion for adoption of those technologies, freeing efficiencies, increasing agility and improving employee retention and morale.
Be a strategic collaborator.
As finance executives develop post-pandemic strategies, the need for strong relationships with executive counterparts is more valuable now than ever. According to Gartner’s 2021 Board of Directors survey, “organizational silos represent one of the most common and chronic barriers to digital business success.”
A key component of the CFO’s evolved mandate is facilitating interdepartmental conversations across the organization. At the height of the pandemic, businesses needed to adapt quickly to a fully virtual workplace. Now, post-pandemic business strategies are focused on how to successfully sustain a virtual or hybrid workplace permanently. To continually engage and cultivate a collaborative work environment in a virtual or hybrid context, strong communication efforts are essential. The modern CFO is leading this effort to build team communication and rapport, while also reimagining existing processes that are not as effective today as they were pre-pandemic.
In this sense, CFOs must see themselves as agents of cultural change -- to identify interdependencies, create successful change alternatives, foster greater understanding, secure executive buy-in and ultimately create a more unified organization.
Be eager to learn and open to feedback.
A key responsibility for the CFO as the head of the office of finance is to interpret raw financial information and data and translate this into meaningful commentary and actions. Throughout this process, and in an effort to build comprehensive strategies, the CFO must gather feedback from all relevant stakeholders - from the C-suite to junior team members.
Too often organizations don’t have clear methods to be able to gather crucial feedback to learn from and improve processes. In a 2021 “Future of Work” survey conducted by Humanyze, more than half of the managers surveyed cited the minimal use of employee surveys to understand employee preferences, but more than 70% reported their company is not leveraging any other data or workplace technologies to inform strategies. This marks a notably missed opportunity for objective data to inform critical business decisions.
While it’s true that the CFO is also tasked with the responsibility of mitigating risk and cutting costs, this can’t stifle innovation. As the finance function moves from efficiency (its cost in serving business needs) to effectiveness (its ability to deliver on those same needs), not only are feedback loops necessary for proper evaluation but actually serve as catalysts for successful business transformation.
Be strategic in pursuing talent and new technology.
CFOs aren’t often the first to be seen as a “people person.” However, being able to identify, retain and empower the right talent is a critical component of the overall success of an organization. Especially in the current context of the great resignation, understanding how to engage and recruit the right talent has only become more critical to an organization’s success. As CFOs become the cornerstones of driving business strategy and facilitating cross-departmental conversations, who better than the CFOs to apply this knowledge and leverage these resources?
According to a recent Deloitte survey, CFOs cited HR/talent and related issues far more frequently than any other priorities for 2022, with many planning to increase spending this year. As the shift in — and the competition for — talent is accelerating, not only is a fluency in technology needed for the entire office of finance, but it also needs to be integrated into the recruitment and development process. For example, digital fluency can be achieved by building a team with diverse backgrounds. Diversity has always been wanted and needed but now companies are really pushing for it when hiring and the CFO should display that same commitment. Therefore, the CFO and office of finance need to establish a digital transformation road map that integrates a talent recruitment strategy, execute on this financial transformation road map and leverage tech to streamline routine redundant tasks, which will help achieve related efficiencies resulting in more freed up time to invest in value-additive, strategic thinking.
As we look forward to the months ahead in 2022 and beyond, the most successful CFOs will be those who prioritize workforce optimization, quickly implement efficiency-boosting technology and attract and retain strong talent. By embracing technology that leverages automation for manual repetitive processes and enabling employees to focus on more value-add work, CFOs can build or enhance their workplace culture into one that is more likely to succeed in engaging their employees and retaining top talent, which ultimately leads to happier, more engaged customers. To learn more about how financial close automation can empower your finance and accounting team, download Trintech’s eBook: Unlocking Human Capability with Financial Close Automation.