In today’s competitive landscape, 40% of CFOs are now spending a majority of their time on non-finance issues. In fact, these business titans are now having to shift their corporate priorities to include different strategic responsibilities within their company outside of the realm of finance. This is a reality modern-age companies are now having to deal with on a foundational level, and to stay ahead of competition, strategic CFOs must adapt their strategies and processes.
The F in CFO no longer just refers to ‘F’inance. Today’s businesses are currently seeing a shift in mentality reflected in the internal structure of companies. CFOs must now be more than just the “number’s expert.” A truly strategic CFO must now be a ‘F’undamental leader. In order to shift priorities and keep a competitive edge, today’s strategic CFOs now need insights into three critical areas:
- Data and Analytics
- Changing Regulatory Requirements
- Cross-Functional Collaborations
1. Interdepartmental Importance of Data and Analytics
The ability to digest and interpret data has always been crucial to a CFO’s ability to optimize their sales pipeline and evaluate financial health. Before the advent of big data, finance departments struggled to stay on top of manually compiling and updating spreadsheets with data. In fact,
73 percent of companies still continue to rely on inefficient, error-prone spreadsheets
The value that instant data brings to the role of the CFO far outweighs any benefit of keeping and continuing to use spreadsheets—especially when 80% of them contain errors. New technologies create a single source of truth for your leadership team and make real-time data available at your fingertips. This gives CFOs confidence that their numbers are accurate, up-to-date, and aligned with the rest of the organization.
Spreadsheets, on the other hand, are not designed to serve the multifaceted and complex nature of a business. In today’s industry, the switch to digitized and automated data is the difference between sink or swim for your business. By encouraging your finance teams to continuously incorporate and leverage data sources into their work processes, you are championing strategic change within your business structure and essentially shining a light onto operational functions in a way you couldn’t before!
2.Changing Regulatory Requirements
As any company with a sales department knows, the implementation of the ASC 606 (IFRS 15) has shaken up the ways companies not only expense costs associated with obtaining contracts but also how they manage their accounting for sales commissions. ASC 606 compliance has proved to be more challenging than expected for companies due to the fact that they must now account for commissions at a more detailed level than before—down to the sales rep, customer, or even individual order.
Imagine the level of difficulty logging these expenses can be if you haven't switched to a digitized platform. The thought of manually compiling this data can be off-putting, but that’s the boat most companies are now finding themselves in. But that’s okay! That’s where digitalization plays in to help ease the workload and essentially make this an error-free process (especially as your data volume increases)!
It’s no secret that over time, the business landscape has grown more and more competitive. For a company to accurately forecast and plan, finance teams are now faced with the challenge of cross-departmentally collaborating with sales in order to align strategy with company goals. To streamline this process, the business as a whole has to be on board with the idea that they must digitize data and essentially create one single source of information, accessible by finance, sales, and leadership teams.
In today’s environments, the need for strategic planning and aggressive growth goals have been a top priority for almost every company interested in staying in business. Companies now have to make sure that at the end of the day, all finance and sales operations are on the same page when it comes to access to resources and benchmarking common performance metrics.
Becoming a Strategic CFO
All-in-all, data-driven CFOs are now equipped with the knowledge and tools to not only implement change and foster confidence in their departments but also take charge of success within their own sales organization. While financial data is a strong key for strategic CFOs to keep in their back pocket, they also must look to new ways to use automation and advanced technology in junction with data to drive organizational strategy and support bottom-line growth.
If you’re interested in a more in-depth analysis of what it takes to be a successful CFO in today’s professional environment, click here to download our “3 Key Opportunities for the Modern CFO” guide.