The mindset of a successful CFO

Rob Israch, General Manager, Tipalti Europe describes the mindset that today’s CFOs need to adopt

 

The rise of AI and automation are playing a key role in digital transformation plans for all businesses – plans which have accelerated as leaders plot their roadmaps to recovery following the pandemic. However, preparing for digital transformation is no mean feat. 

 

From ensuring longevity with a permanently dispersed workforce, to keeping company and customer data secure from almost daily ransomware attacks, there’s many factors to consider on the continuous digital transformation journey.

 

For businesses which have fallen short in seeing digital transformation success, it’s often the case that they work in a siloed fashion. Input is needed from each department so the direction of travel is streamlined and efficient. For a CFO, this is another task added to an already lengthy list of priorities.

 

Get it right however, and AI and automation has the potential to free the finance department of outdated manual processes, allowing finance leaders to have more time and control – two vital things needed to achieve growth and meet changing business needs.  

 

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

 

1.   CFOs wear a lot of hats, especially in the early days

 

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.

 

Depending on where your business is on its journey, the CFO’s role could look very different. As an early business leader, responsibilities might far exceed accounting and finance. For Berry, it even included HR, legal, facilities and IT. As Sojern grew, Atkisson says adapting responsibilities at the right time was key: “As we hired more specialists, we created centres of excellence with their own formal charters and stakeholders, who could work through how decisions and priorities would be made. This was critical to managing our 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.

 

2.   Business expansion can’t happen on spreadsheets

 

When you’re growing, rolling out the same processes you’ve used thus far on a larger scale simply won’t work. Procurement cycles can become more complex with additional approval layers, and customer bases grow to sizes that mean manual operations that were once were manageable are no longer viable.

 

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, Attkisson 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 this is 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.  

 

3.   Having a VC mindset

 

A forward thinking finance team 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 their contribution.

 

4.   Increase efficiency with the same headcount

 

Persuading the executive team to invest in new finance technology may not always be a straightforward process, so it’s important to think beyond broader efficiency gains, organisational issues and corporate strategy before adoption of new tools.

 

When choosing the right automated tools, 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, such as helping the business scale, strengthen controls or improve decision making? Will they scale alongside the business’ growth or are they only temporary fixes that come with high change costs? 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.

 

5.   Lead from the front to ensure company culture embraces technology

 

Software implementations can sometimes carry a reputation for being painful with long processes, so it’s important leaders and end users feel excited to build something transformative. CFOs should lead from the front and drive this culture shift within the organisation, encouraging process owners to feel motivated and prepared to implement new tools that will enhance their skill sets. In turn, this could lead to owners even campaigning for future implementations to be prioritised. 

 

It’s clear that today’s modern CFO is wearing many hats – more than they did just a couple of years ago. In the UK specifically, continuously changing circumstances due to the pandemic and the unchartered waters brought about by Brexit have added complexity to the role.

 

Now more than ever, it is important for CFOs and finance teams to have the ability to step back from the manual day-to-day processes that can be handled by AI and automation and towards strategic initiatives that help them survive and thrive whatever the challenge.

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Rob Israch is General Manager at Tipalti Europe

Main image courtesy of iStockPhoto.com