Economic guardian: Leading the finance function
February 9, 2021
RESEARCH REPORT
In brief
In brief
- Many CFOs are missing out on the full benefits of technology. For instance, only 16% of CFOs use the cloud to identify new value sources.
- As economic guardians, CFOs will no longer simply use technology to solve yesterday’s problems.
- To embrace this new role, CFOs adopt new responsibilities, including reinventing their work culture and unlocking predictive forecasting.
Whether it’s through massive disruption or unprecedented growth, the prime concern of CFOs is to protect the financial viability of the enterprise.
Many have made major investments in technology to support this undertaking. Others struggle to keep up (much less stay ahead) with the pace of business required today.
Many CFOs haven’t unleashed the full value of digital to increase the speed of insights and the breadth of capabilities. Instead, their top applications of technology like basic automation are to solve yesterday’s problems, like enabling cost efficiencies and improving reporting accuracy.
In fact, only 43% of CFOs have used advanced financial modeling in the past two years to identify future risks and opportunities.
Protect the enterprise with digital and cloud
Cloud architectures offer new possibilities for speeding up CFOs’ decision-making. The cloud provides massive computing power in a simple, flexible environment to process large amounts of data.
But it remains an underutilized technology.
23%
of CFOs are using the cloud to provide new insights.
16%
of CFOs say they are using the cloud to identity new value sources.
By embracing the role of economic guardian, CFOs can protect an enterprise’s financial viability and capture the full potential of advanced technology. That’s because in a data-rich environment, CFOs increasingly have access to the edges of the organization—where the action is happening across an enterprise’s value chain, closest to the supply and demand signals.
Finance is the single function that has people deployed in these areas and can feed their insights into the corporate decision-making bodies.
This new role of the CFO should be analogous to "edge computing," which is moving computation and storage closer to the decentralized devices that are capturing real-time data.
Cloud architectures offer a whole new world of possibilities to the CFOs, allowing for much deeper insights and faster decision-making.
The finance talent journey
CFOs are no longer looking for traditional finance skills as the cornerstone of a successful team that can move with speed and agility. In fact, 75% of CFOs believe their company is on a course to fundamentally redesign how people work and reinvent their culture to support new behaviors and mindsets.
Some highly sought-after skills include data exploration and analysis, scenario planning and horizon scanning, innovation, and storytelling.
Embracing the role of economic guardian
Here are three actions CFOs can take to drive value:
- Break down data silos once and for all with advanced technology.
- Use advanced technology not only to process financial data but to unlock predictive forecasting.
- Empower finance professionals to build new skills and take on broader responsibilities.
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