As the CFO’s role continues to evolve from a simple finance function to a strategic business leader and innovator, tomorrow’s CFOs will need new and different skills compared to their traditional counterparts. Understanding the importance of these skills will be the difference between a successful CFO and one that struggles to remain relevant, according to Concur.
Matthew Goss, managing director, ANZ, SAP Concur, said, “Remaining relevant in a changing world means CFOs have to evolve alongside the business. Their expanding sphere of influence puts CFOs in an ideal position to drive the company’s direction. Doing so effectively means these CFOs need to be more than accountants. In fact, the CFO of tomorrow may not even come from an accounting background.
“Instead, CFOs need to be strategic thinkers, problem solvers, facilitators, IT experts, efficiency experts, and more. Technology is making traditional accounting skills largely redundant. Instead, CFOs will need an understanding of big data, analytics, automation, machine learning, artificial intelligence, and more. Tomorrow’s CFO could have a background in engineering, sales, production, or data science.”
Concur has identified four key skills required by tomorrow’s CFO:
1. IT and technology
CFOs are no longer brought into purchasing decisions at the end to approve the expenditure. Now, CFOs are expected to be actively involved in decisions around investing in emerging technologies, and many leadership teams look to the CFO to control IT strategy. The entire IT organisation is, ideally, integrated and efficient, linked explicitly to business strategy in ways that weren’t considered necessary in the past. Staying on top of IT-related issues, from security to investment in new systems, will be time-consuming and mission-critical for CFOs.
2. Big data and analytics
Businesses are increasingly data-driven and it’s falling to the CFO to manage and control this process. CFOs with a clear understanding of how to manage big data, how to extract actionable insights, and how to avoid getting caught up in big data traps, will be more successful. They’ll be able to drive the business forward by making the right decisions at the right time. While the CFO can employ data scientists to do the heavy lifting, it’s essential for them to understand the process so they can direct big data resources to where they’ll have the greatest impact.
3. Risk management
While managing risk has always been a key function for the CFO, the lens with which they view risk needs to broaden to encompass the entire organisation, not just the financials. In the wake of the global financial crisis, the focus on risk has become an even higher priority. The amount of assurance required from external parties has increased dramatically, so CFOs will need to embrace systems with automation and compliance features just to manage their risk profile effectively. It’s also important to understand the risk deeply to avoid being hamstrung by it.
The way IT is selected, procured, and consumed has changed. The finance team is usually the guinea pig, rolling out new systems and applications before the rest of the business. The rise of shadow IT makes it harder to control what technology is in the organisation, and the ability for employees to pay for systems on their credit card and roll them out from the cloud makes shadow IT hard to detect and manage. This means the CFO needs to be a facilitator to ensure each team in the organisation has the tools and technology it needs to work effectively. The finance team needs to retain some visibility and control into IT spending to manage budgets effectively as well as to make sure employees don’t feel the need to get their own systems.
Matthew Goss said, “CFOs should know every aspect of the business in depth so they can provide insight and ideas around solving business challenges. They need to be on top of emerging technology so they can make strategic recommendations regarding what’s right for the business. And they need to be capable of driving performance from employees to maximise the value of resources. This is a complicated role that can only be executed successfully with the right mix of skills and experience.”