Finance and Enterprise Performance Improvement

In the past several years, the role of finance in business has significantly transformed from being a back office, desk-bound, number cruncher into a more broader, stakeholder-engaging and advisory role responsible for influencing strategic and operational decision making and improving enterprise performance.

Thanks to new innovative digital technologies and business operating models, CFOs and their teams are no longer spending plenty of time working on low-value add and backward looking tasks such as account reconciliations and reporting.

Instead, the explosion in RPA, advanced data analytics and AI technologies is empowering the finance organization to generate, consolidate and analyze data from various sources, and provide actionable insights that add real strategic value to the business.

As a result, commercially-minded and technology savvy finance leaders are cementing their positions as the trusted advisor to the CEO and Board, helping define and execute on the strategic direction of the business.

Today, we live in a world that is dynamically changing and full of surprises and uncertainties.

For example, one day we are dealing with the fallout from geopolitical tensions, the next day it’s natural and man-made disasters disrupting the entire supply chain.

Then a criminal cyber attack bringing the company’s payments and receipts system to a complete halt. This cycle is never ending.

In this environment typified by impermanence – there is no guarantee that existing finance strategies, operating models, systems, processes and talent will continually take your finance organization to new heights.

Although some progress has been made over the years concerning how finance work is done, we are not yet there yet. There is still ample room for improvement.

Lead the charge for change

Familiarity is the antithesis of progress. In order to soar to new heights, finance leaders and their teams ought to be receptive to change.

In spite of the immense potential of new digital technologies to transform the way finance creates and delivers value across the business, compared to other functions, adoption of game changing technologies within finance has been lackluster in the past years.

Does this imply that CFOs should get their hands on each and every latest shiny tool out there? No, technology is simply an enabler to achieve better business decisions.

What is important is for the CFO to understand the art of the possible.

That is the capabilities provided by the new technology to support and adapt the business’ value propositions, processes, pricing and revenue models, strategy execution, and growth.

The CFO should take charge and act as catalyst for change, ensuring that all represented stakeholders have a complete view understanding of what the business is seeking to achieve, what problems you’re trying to solve and what processes you’re looking to make more efficient, and what the investment’s contribution towards the achievement of enterprise objectives is.

Think differently enough to provide an alternative perspective.

Today, finance is no longer just a numbers game. What was typically a role centered on cost, compliance and reporting has now expanded to include strategy, risk decision-making and performance management.

It’s therefore important that finance leaders and their teams invest some time developing an in depth understanding of the business model, strategy, market opportunities and threats, competition dynamics, product portfolio, supplier relationships and customer profiles as this is key to providing a unique perspective that looks across all departments.

Historical performance reporting has been overtaken by trend recognition, forward-looking business and operating plans, real-time metrics, and driver-based rolling forecasts ultimately accelerating the need for the modern finance leader to be more proactive and growth-oriented, rather than being restrictive.

Being a finance leader does not necessarilly mean you should have all the answers to business performance related matters.

What is required is curiosity. Continuously raising key performance questions that ultimately kickstart productive conversations and collaborative efforts across the business.

CFOs with the ability to utilise modern digital offerings to close information gaps across the business, uncover hidden opportunities, accurately predict the future and improve decision making will by far differentiate themselves from their counterparts.

People, People, People

To be successful CFOs must build teams capable and empowered with the right tools and support to deliver a high standard of work across the various finance pillars.

This is essential for freeing up time for the CFO to support the board in driving the business forward.

Whether it’s for themselves or other members of their team, CFOs should continually look at reskilling and upskilling opportunities. The changing dynamics of CFOs’ role mean they need to keep learning to have the business, analytical and data skills both them and their team require.

In addition to reskilling and upskilling team members, CFOs also need to create an environment that encourages testing of new ideas, processes and tools. When teams and individuals are encouraged to explore, great things happen.

The journey to great heights is sometimes fraught with twists and turns and failures. But it is only through ongoing learning from these experiences that we become better. CFOs should never be afraid to test new business models, processes, technologies and skills for fear of failure.

The time to embrace change and transform is now.