We’re seeing big shifts in the role of the CFO and how finance chiefs expect to create value over the next decade. The CFO of 2030 will look quite different than the CFO of 2020, and while some goals will remain the same (such as ongoing pushes to decrease costs and increasing focus on value-add activities over transaction processing activities), others will take new prominence.
Specifically, companies should prepare for a wide-scale finance department transformation spearheaded by a rise in automated technologies, better data management, and a push for CFOs to strengthen internal partnerships across all finance functions.
Through these goals, CFOs will prepare themselves to not just succeed today, but become known as a CFO of the future who’s capable of guiding the organization’s financial future.
What Is the CFO of the Future?
The CFO of the future is an executive who understands that value creation will be more driven by technology than in years past, with a variety of tech-centric solutions available to shine light on trends and support the CFO’s ability to perform financial forecasts. In one survey, half of CFOs agreed that they wanted to use advanced analytics to improve cash flow forecasts, and these numbers will only increase over time.
A new respect for data governance
Primarily, data availability will support the future of corporate finance in ways not seen in previous years. With more tools available to support business functions across:
- Supply chain management (SCM)
- Customer relationship management (CRM)
- Enterprise resource planning (ERP)
Alongside a host of other business functions, corporations have more information to play with than ever before. Better still, we’re seeing shifts towards integrating these solutions in smarter ways to reduce silos and bring end-to-end visibility across processes – must-haves for long-term forecasting.
Of course, just having the data is only part of the puzzle. CFOs will need to take an increased role in data governance and ensure that the right people have the data they need across finance functions, whether they’re involved in sales or managing accounts payable (AP) or accounts receivable (AR).
Embracing automation as a strategic force
As part of the technology push, expect to see emerging technology solutions like automation and machine learning take prominence in CFO transformation. This is a fast-moving goal, as research shows that only 19% of CFOs have automated nearly all of their finance processes.
These types of solutions will bear fruit for time-intensive, manual tasks:
- Invoice issuing
- Sales tax calculations
- Monthly reporting
- Customer outreach
While these solutions have been a mainstay for years now, expect to see them take a more prominent role for the CFO and digital transformation goals in the coming years. Improvements to machine learning algorithms and computing power have made these solutions more accessible, and they can increasingly be applied to more complicated tasks. These shifts have allowed CFOs to focus more on risk reduction, audits, and pursuing value creation.
Effective finance department transformation will increasingly rely on these types of solutions. As technology becomes more integrated into core business functions, CFOs will need to start treating these types of forward-thinking solutions as essential tools rather than bells and whistles.
Strengthening partnerships and talent
CFOs will need to reimagine their talent management strategies to stay successful. This is about managing finance staff time and ensuring that everyone is on the same page when it comes to understanding which key business goals drive financial performance.
This goal will be supported by the push for automation detailed above, but CFOs will need to spearhead changes as the chief driver of financial strategy. Again, it comes down to the data and making sure that all teams have what they need to stay successful. CFOs need to be the agents of change, from data governance to helping teams develop the essential skills necessary to succeed in the finance function.
Another key aspect for CFOs will be developing strong business cases for data management and new solutions to foster this buy-in among teams. IT, sales, marketing, accounting, and operational functions will all need to be on board with solutions, and a strong, actionable business case can help teams visualize what type of quantifiable ROI to expect from process improvements.
The Future of Corporate Finance
The CFO of 2030 will be driven by technology, data, and an increased need to leverage advanced solutions to improve decision-making. Given that the role of the CFO remains as the strategic control tower for finance management, financial leaders will need to embrace any solutions that allow them to produce faster, richer, and better insights.
From there, CFOs will be better positioned to make big picture decisions about how the finance function can be reimagined and how to help their teams mobilize to produce results on their own. They’re challenging targets to hit, but technology is making it easier. As time goes on, more CFOs will begin to embrace these ideas and take on bigger roles as drivers of change, better positioning their companies for success over the next decade.
