Technological advance, finds a new report, is enabling CFOs to become more strategic, finds a new report. A range of new technologies, from process robotics to data analytics, is set to free time away from backwards looking internal finance tasks, as well as offer deeper insights and forward looking projection, from which they may inform and participate in key business strategy.
The rise of technology is offering a range of business functions with a new, and often more efficient, ways of performing their function. The CFO role too is changing, according to a new report from BearingPoint, titled ‘The exponential CFO’. The report considers the potential effect of digital technology on the function, as well as its wider effects on the strategic capabilities of businesses.
The study finds that companies are increasingly looking towards technologies to improve their operations. Businesses are in particular looking to prioritise leveraging technology to facilitate analysis and decision making, cited by 62% of respondents to the survey, followed by ongoing monitoring of business performance, cited by 57% of respondents. The businesses surveyed are also keen to invest in technologies that measure product and consumer profitability, as well as create an effective environment, cited by 49% of respondents.
For the CFO function, most respondents (75%) believe that technology will have some or high impact on their business, while 25% of respondents say that it will have no or low impact on their respective businesses.
The study notes that a range of technologies are likely to impact the CFO function, whether directly or indirectly. Some of these trends include big data and analytics, which create opportunities across the value chain for deeper insight into key business vitals. The CFO will need to be equipped to leverage the technology in a business meaningful way. The rise of robots, means that more and more finance functions can be automated, requiring the CFO to make key department decisions around investment and staffing. New workflow technologies as well as new mindsets, are likely to affect staff attraction and retention, changing business norms for CFOs.
Digital technologies are further changing the distance between once far flung shores, opening new markets and new supply potentials, even while B2C and B2B e-commerce become the norm in a variety of sectors – creating new opportunities and challenges. The report also change the trust relationship between parties, with new technologies, such as blockchain, able to become trust keystones and improve a range of financial transaction metrics.
The report notes that one of the key changes for CFOs is that their time, the lion’s share of which is taxed by transactional and retrospective tasks, is partly freed by new technologies that streamline those operations, or leverage results from those operations for more forward looking projections. These projections can in discussion with the CEO be used to develop new opportunities, underpin, or proactively finance, business strategy.
The technology platforms may become key strategic enablers for the CFO function. These platforms, according to the authors, can be used to understand and integrate key drivers across business models, customers and value added. Create a means to holistically review key business performance metrics in the talent arena; transform internal processes; create additional communications channels and social business tools; as well as open up new possibilities for further innovation, digital business models and growth.
Damien Palacci, a Partner at BearingPoint in Paris and a co-author of the reports adds, “As our client testimonials illustrate, digital is heavily influencing business execution with the consequences being felt increasingly within the finance department. Of course, every company is at a different point in its journey to adopt relevant aspects of digital; for example, to leverage the advantages of new platform-based digital models to generate higher customer traction and better customer engagement.”