If you’re lucky enough to be in charge of an organization’s finances, you’ve had your share of headaches. Perhaps none have been as pervasive as the last few years, however. Pandemic notwithstanding, the role of the Chief Financial Officer has changed. This week’s Fortune declared that CFO’s “can’t hide from tech.” We agree.
According to McKinsey’s recent research the use of robotics and artificial-intelligence (AI) tools for finance leaders has more than tripled since 2018. The use of advanced analytics for finance tasks has almost doubled, with claims from those polled that their companies’ IT and digital investments have paid off. We applaud these efforts knowing they are no small feat.
With the rise in automation and digital transformation, the responsibilities of financial leaders have grown to include investor relations as well. With 44% of the focus on outside investments in 2016, that number is now 64%.
This data shows as more industries move toward recovery, finance leaders can affect cross-departmental areas of the business. Insights from the CFO’s that are rapidly advancing automated financials, will be an asset to mitigating risk across the organization.
Perhaps the best news for a SaaS company reliant on AI, such as Oversight, are the survey results showing that digital adoption continues to rise. And those using advanced analytics, like automation has almost doubled. Even better, since these are the ones dependent on reporting ROI, are the nearly six in ten stating these investments garner a “positive or very positive ROI.” We couldn’t say it better ourselves.
Crisis management is another area that is vital in this adapted role. Finance leaders are counted on for restoring organizational health which comes with being better prepared for those inevitable crises. Reviewing plans and performing digital audits help financial teams see where they are in the game of shifting numbers.
Experimenting with new tools and technology are the second step that successful CFO’s are taking. These include advanced analytics for business operations and finance, robotics and AI, and data visualization. Having the right IT tools working around the clock mitigates risk across the organization.
The buck doesn’t stop at just “adopt digital” for CFO’s. After weathering the COVID-19 storm, smart leaders will focus on financially steering companies towards their environmental, social and governance (ESG) impact. This is where the investors will be looking when it comes time to broker a deal or go public.
If your company can’t attest to these efforts, it shows hesitancy, according to KPMG’s 2020 report. Expect the CFO role to include more data on this growing standard if they want to attract companies that are coalescing around this.
Our key takeaway from McKinsey’s report is how critical the involvement of a forward-thinking CFO is to an organization dependent on change. They must meet growth and profit expectations while taking into account stakeholder demands. They must also keep pace with rapid change, expanded regulations, and customer expectations.
The need for accurate, real-time data and analytics has never been more vital to the CFO and company than now. CFO's have the ability to see it all, spot the patterns and steer the future. Let’s close Q4 strong.
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