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The mindsets needed for a successful modern CFO

by Wanda Rich
portrait of business woman at her business office great leader SBI 335712819

By: Rob Israch, General Manager, Tipalti Europe

The global digital transformation, expedited by the pandemic, has given rise to AI and automation technologies, forcing business leaders to look ahead and map out their road to recovery. However, the task of putting the plans in place to execute a digital transformation are by no means straightforward. Emerging from the pandemic, there is an increased demand for business readiness on a wide range of issues from securing customer data to ensuring longevity with a permanently dispersed workforce. 

For businesses to implement a successful digital transformation, collaborative working is key. Each department must be integrated in the process so the direction of travel is streamlined and efficient. For a CFO, this is no mean feat given the number of responsibilities they are already juggling. In fact, Tipalti’s research revealed that 97% of UK CFOs say their job has become more complex in the last two years. However, when executed correctly, AI and automation opens doors for business growth by freeing the financial department of outdated manual processes. 

From conversations with both Curtis Atkisson, CFO of Sojern and John Berry, Director of Advanced Analytics & Automation at KPMG, we have identified five mindsets needed for a modern CFO to harness the power of AI and automation to support business growth…

  1.   Adaptability

The CFO position is unique. You are expected to combine finance, strategy, analytics, and automation and then layer governance and executive routines on top. This is all in pursuit of scaling while creating repeatable and dependable processes in your tech stack. Being adaptable and ready to tackle the required responsibility at the right time is key to managing growth and transition.

Time is one of the most precious assets for a CFO in any business, which is why adoption of the right solutions is imperative – to free up time away from manual work and allowing them to focus on tasks that matter.

  1.   Innovator 

When you’re growing, rolling out the same processes you’ve used thus far on a larger scale simply won’t work. For a CFO, procurement cycles can become more complex with additional approval layers, and customer bases grow to sizes that mean manual operations are no longer viable. Ultimately, real growth can’t happen on spreadsheets.

Atkisson recalls: “We wanted to grow fast and needed to get out of spreadsheets”. With an accounting team in the US, London, Singapore and Istanbul, Atkisson implemented a tech stack, each with a required solution, to support the department.

With investment in firms picking back up after an uncertain 2020, many CFOs will undoubtedly find themselves behind the wheel of a business which is expanding quicker than planned. While a positive, it’s important to acknowledge when processes need updating and initial investment in specialist tools required is fundamental to support the large scale growth.  

  1.   The Investor

A forward thinking finance leader behaves like a potential investor within the business – running the different departments like micro business units within the broader team.

Berry notes, “Having a VC mindset is critical. Look at the business from a portfolio perspective—for strategic frameworks, for your stakeholders, and for driving new metrics.”

Once again, finding the time to do this can be difficult without support functions that remove processes which have historically sat with the CFO, but no longer need to. These can often include accounts payable, monthly close, financial reporting, supplier payments, budgeting, procurement, financial planning,  tax, and fintech system selection and implementation. CFOs should look to automate these processes where possible and delegate where needed to elevate contribution.

  1.   Efficiency

Recognising that the team is working below the optimum level of efficiency is only step one. Step two will require the CFO to adopt the right tools. When choosing the right automated tools for your finance team, there are important considerations to think through beyond the solution’s primary output. These should include potential risks, governance implications, employee satisfaction, possible turn over, and onboarding expenses. 

Beyond time savings, further questions should include whether the solutions add strategic business value? Will they scale alongside the business’ growth or are they only temporary fixes? Finally, do the systems require too much employee change management for your teams to absorb, threatening the potential success of a project? 

“We recommend clients look at new opportunities, including cycle time reductions, reducing or preventing headcount, automating tasks, and optimising processes,” comments Berry.

In order to improve efficiency, the modern CFO will need to find the right solutions to meet the needs of their team. As always, this may require a small investment of time initially, however, by having a mindset that looks beyond the short term, long term goals will become much more achievable.

  1.   Greening of the business

Over a quarter (27%) of CFOs describe incorporating ESG (environmental, social and governance) into their role as a main driver of complexity. The origin of this priority is clear as strong ESG ratings become ever more critical for investors, CEOs are turning to their finance leaders for solutions.

It’s a responsibility that can’t be shirked with added government pressure to meet looming sustainability targets. With sustainability now a measurement of a successful, reputable brand, the modern CFO must ensure they have adopted the right processes in their teams to allow time to innovate.

Being a CFO today requires wearing many hats – more than they would have had a number of years ago. Continuously changing circumstances due to the pandemic and the continued uncertainty and cloudy waters brought about by Brexit have added further complexity to the role. Now more than ever, it is important finance leaders have the ability to step back from the manual day-to-day tasks that AI and automation can take over and invest their time towards strategic initiatives their teams and ultimately the business, thrive whatever the challenge.

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