Eilika Regenbrecht, Country Lead Netherlands, at Pleo
Traditional finance departments have long been seen as places where employees mainly dealt with tables and numbers. But times have changed: in fact, finance leaders are increasingly taking on the role of a strategic partner of the CEO. A central role in the organization allows them to influence innovation, efficiency and future strategy.
Recent research shows a shift in the way CFOs work. The most recent McKinsey Global Survey on the role of the CFO shows that today’s finance leaders are often involved in long-term strategy and management decisions, and two-thirds are involved in digital transformation. Similarly, our own research on the
State of Expenditure 2023, shows that that 97% of business decision makers in Europe see a change in the CFO’s influence across the company.
The CFO anno 2023
A CFO anno 2023 has many responsibilities, including technology, crisis management and strategy. There is a growing awareness of the need to embrace digital technology to drive efficiency and reduce costs. In addition, they are investing more in smart automated and digital systems that also help the finance department itself innovate.
The recent pandemic, global supply chain issues, inflation and uncertain economic times have brought about a lot of change. Providing transparency has become one of the important tasks for a CFO. To steer the company in the right direction, it is important for CFOs to properly manage KPIs and targets. By using data, they can show company what the future looks like and in what way they can achieve the goals.
Using data for better forecasting and scenario planning
Using quality data for forecasting and scenario planning, among other things, helps make faster and more informed strategic decisions. Technologies such as cloud computing, AI and machine learning allow CFOs to analyze thousands of data points across multiple systems in near real-time, allowing trends and anomalies to be identified with greater speed and accuracy.
By providing insight into key business data and showing the impact on efficiency and financial performance, CFOs can make a difference in their organization
Three tips for CFOs who want to be a strategic partner
The increase in available financial data and the increased strategic importance of cash flow planning offer CFOs an opportunity to become a strategic partner to the CEO. There are three key areas of focus if you want to be a strategic CFO:
1. Stay close to the company and be curious
Strategic CFOs attend many meetings and communicate with the entire company. They place their team in different departments to get a good overview of the organization. The CFO needs to know what the commercial team is struggling with or how the sales team is performing.
2. Data first, second and third
The CFO has access to a wealth of data that can inform other parts of the company. To be seen as a strategic advisor, he or she must identify where it is smart to share data reports to improve the process or efficiency of someone else in the organization.
3. Step outside your comfort zone
If a company has a challenge with design, and they don’t have the capacity to solve that problem, a proactive CFO can take the opportunity to support. They can ask questions, understand the problem well, and provide assistance by, for example, setting up project management or an appropriate process.