Evolution of CFO Roles: Shifting to Strategic Leadership Post-Pandemic
Post-pandemic, CFOs broaden roles beyond accounting, assuming greater strategic responsibilities within organizations.
Research from Brainyard spanning 21 industries shows the CFO’s role evolving into a pillar of corporate innovation, organizational change, and forward-thinking culture. CFOs are now critical in driving company growth by establishing strategic alliances, assessing technology, and boosting revenue and earnings, leading to fewer exclusively finance-focused executives.
Having to manage these additional responsibilities while continuing to oversee the finance function at a time of serious quality talent shortage is a major undertaking.
Extended duties lead to long CFO hours, especially in smaller organizations without additional financial support.
Here are some of the most challenging issues CFOs will likely face in 2023 together with some approaches that may keep the organization lean and competitive:
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Finding and retaining the right people.
Forbes reports that nearly 80% of CFOs seek technological expertise in new employees, highlighting the shift in required skills. CFOs now need skills to support automated systems independently, speeding up data analysis.
Acquiring and retaining the appropriate talent requires a thoughtful approach to compensation, career-pathing and effective training. Upskilling current talent is crucial and, when done effectively, motivates and rewards key staff.”
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Improving Communication
The efforts to better train and enable team members should be accompanied by the development of excellent communication skills. As the CFO’s role broadens, effective communication with various stakeholders becomes crucial for driving results.”
Varied communication types demand diverse skills among team members, favoring some over others. Clarifying expectations, reinforcing, and training can yield lasting operational benefits while enhancing morale and self-esteem.
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Innovating
The failure to embrace productivity gains offered by evolving technology can hold even well-managed companies back. Within the finance department embracing modern tools is key. Automated tools ease tedium, mitigate risks, and significantly impact overall organizational efficiency.
Innovating with strategic systems shifts CFO focus from tasks to analysis, enabling informed recommendations. This leads to better information and more intuitive tools for managers across the organization, including predictive analytics, easy-to-follow dashboards, and key performance indicators. Decisions based on clear and reliable data can have a dramatic impact on competitiveness and profitability.
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Managing Risk
Business risk can take many forms. Controls and clear responsibilities traditionally ensure sound financial resource management in finance departments. In today’s economy, CFO roles extend to managing technology and security as the company’s economic guardian. PwC notes nearly 75% of CFOs worry about tax and regulatory risks in the macroeconomic climate.”
With many CFOs now viewing risk management as one of their biggest challenges, technology innovation comes to the fore again. Well configured ERP systems can enforce controls often difficult to manage manually. Financial reporting systems can improve accuracy, reduce the risk of error and ensure compliance with ever-changing regulatory requirements. CFOs increasingly favor SOC and secure cloud computing for managing fraud and cybersecurity due to portability and scalability.
Summary
CFOs will continue to play an increasingly key role in driving business innovation in 2023. Deploying suitable technology strategically aids team building, behavior, and mitigating business risk challenges. Innovative CFOs using technology positively equip their organizations to stay competitive and succeed.
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