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Reshaping the CFO Role – CFO

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Surveys carried out before and all through the pandemic clearly show the coronavirus crisis may be reshaping the job of the CFO, with senior finance executives shifting their aim to crafting tactic and making business price.

CFO Investigation (component of Argyle Advisory and Investigation Services) and Grant Thornton surveyed 631 CFOs and other senior finance executives in February, then followed up with a study of 174 CFOs and senior finance executives in May possibly, to gauge the outcomes of the COVID-19 upheaval.

Besides the transforming aim of CFOs, the surveys exposed widescale delays for innovation initiatives, a renewed appreciation for business tactic skills, cybersecurity price increases, and enjoy for innovative analytics and artificial intelligence.

Roles and Jobs

The February and May possibly surveys showed that the job of the CFO shifted when the pandemic hit. In both equally surveys, the executives had been requested how substantially of CFOs’ time would be expended in these 4 roles: strategist (crafting company tactic) transform agent (making business price) producer (standardizing and automating transactional procedures) and guardian (standardizing manage and compliance procedures).

In February, the study respondents documented that CFOs’ time was divided reasonably similarly across the 4 roles. But by May possibly that balance experienced shifted in reaction to the COVID-19 crisis: strategist and transform agent roles had been getting extra of CFOs’ time compared with the producer and guardian roles.

Irrespective of the evident shift to extra forward-looking tasks, the coronavirus compelled a huge majority of CFOs to set off or transform their options for innovation initiatives. Eight out of 10 surveyed finance executives experienced delayed or reshaped innovation initiatives in May possibly. Sixty-two per cent of the respondents documented that the COVID-19 crisis experienced delayed their transformational initiatives although 19% claimed the crisis experienced reshaped their initiatives and they had been pursuing a different solution. The remaining 19% documented that the crisis experienced accelerated transformation initiatives.

Delaying and reshaping innovation initiatives does not indicate they are extinguished. Additional than 90% of 335 finance professionals polled all through a Grant Thornton webinar in June claimed they prepared to continue on to innovate, even all through the COVID-19 downturn.

Automation Stays the System

Superior analytics and artificial intelligence had been favored categories of automation technology in both equally the February and May possibly surveys.

A majority of the executives in the May possibly study documented that their options for employing automation systems experienced not been delayed by the pandemic. Additional executives slated innovative analytics for accelerated implementation (29%) than they did any other class of technology. Synthetic intelligence was a near second at 23%.

The February study experienced requested executives when they predicted to put into action a list of specified automation systems. Most respondents (55%) experienced presently applied innovative analytics. Optical character recognition was the second-most-presently-applied automation technology, at 40%. Synthetic intelligence experienced the optimum proportion of prepared implementations within 12 months (33%), followed by robotic procedure automation (30%).

In a December 2019 economic downturn preparedness study by Grant Thornton, 70% of respondents documented options to improve their digital investments in innovation/technology, digital transformation, and/or cybersecurity, even amid developing signs of a slowdown. In the February CFO study, about 70% of the senior finance executives documented they experienced possibly applied crucial rising systems or they would be employing them within two many years.

When requested in May possibly about how expenses would transform around the future calendar year because of COVID-19, cybersecurity experienced the optimum proportion of executives projecting increases (forty four%) followed by IT/digital transformation (40%), schooling and progress (22%), functions (21%), and advertising (19%). Not remarkably, the categories with the cheapest projections for price increases had been vacation (4%), actual estate (6%), recruiting (seven%), and workforce (seven%). Ninety per cent of the executives projected their vacation expenses would lessen.

Adore for Business enterprise Technique

Fitting with the obtaining of CFOs observing them selves in extra strategic roles all through the pandemic, the finance executives surveyed held business tactic skills in higher regard.

They saw business tactic as an important skillset both equally before and following the onset of the pandemic. Operations administration skills had been virtually as valued as business tactic skills in the pandemic crisis surroundings. When finance executives had been requested which important skill they experienced leveraged because of the coronavirus crisis, the most-cited respond to was business tactic, picked out by 34% of the executives, followed by functions administration (29%). Data analytics and innovation/entrepreneurship had been tied as the third-most-cited top skills drawn on all through the pandemic, at 10%.

The February study requested a related question — what had been the most important skillsets respondents would like to establish within their finance perform? Data analytics and business tactic had been the most-cited responses, by 23% and 22% of the respondents, respectively, followed by software progress (17%) and shopper working experience administration (eleven%).

Other Impacts

There is no doubt that business tactic progress was not the only additional accountability for CFOs arising from the pandemic-induced economic downturn.

Amongst the brief-term priorities and lasting impacts of the pandemic, the executives in the May possibly study independently stated:
• diminished capex
• the potential to invest in less-perfectly-capitalized providers
• diminished income move impacting debt covenants
• source prioritization in the face of constrained provide chains and
• extended-term implications of an progressively mobile workforce on business office space, recruiting, and vacation.

Most of people impacts will continue on to have a huge influence on what CFOs devote their time on in the coming months. Respondents claimed they had been observing CFOs branching out into new places of organizational leadership, these kinds of as main production and procedures, running layoffs and shuttering functions, doing work with business units to build many producing resources, running remote workforces, partnering with the community, and interacting with investors.

Inside the conventional scope of finance, new places of aim for some finance chiefs bundled acquisitions and divestitures, moves to maintain income and resources, coronavirus fiscal-affect versions, expenditure chance, forecasting and budgeting, payments and income move administration, chance mitigation, liquidity administration, profits progress, and cost reduction. Paycheck Safety Plan documentation and investigation also appeared on the list.

Amongst the new places of aim within technology leadership, finance executives stated relocating all features to paperless, employing function-from-home systems, and overseeing IT and stability.
And one particular govt stated a-not-unfamiliar CFO job:

Keith Button is a freelance writer primarily based in Valley Cottage, N.Y.

Business enterprise Technique, COVID-19, innovation, Issue 2020-09 CFO, Technological innovation