What the Chief Financial Officer (CFO) needs to face the modern age
The role of the Chief Financial Officer (CFO) has not been the same for years. Currently, technologies are added to certain soft skills (or soft skills) crucial to the position. One of them is adaptability to changes: proactivity is required in business strategies.
From an overview, we can say that the Chief Financial Officer went from being a visionary of the future of the business to a strategic partner with a vision of the future. And although it sounds easy, it is a turn not so easy to achieve. However, this evolution is not by chance.
In the past, CFOs were known to be primarily responsible for a company’s finances; They knew the accounting statements of the company closely and provided the financial statements, in addition to ensuring compliance with the laws.
However, the modern era requires an extra effort from this profile. The same market demands that the CFO be able to perform management tasks for their teams and collaborators, as well as deploy the organization’s strategic plans with creativity and confidence.
Why? To a great extent, the finance area of a business in today’s markets has become much more important, having the ability to have information across the entire business, from a Budget that defines the objectives of each area, to a Cash Flow that defines the payment to each employee.
The position of a CFO and his team means that, through information, they can interact with all areas of the business, and be responsible for processes that involve the global vision of the company, under the economic-financial approach.
In this article we suggest you review what the modern landscape is like for Chief Financial Officers and what are the functions and tasks in which their expertise is required. In addition, we invite you to read our downloadable «10 challenges of the modern finance professional«, a key material for your professional management.
The contribution of new technologies in finance
As we mentioned before, the financial director CFO of a company requires the support and solid response that technology can provide. Through this, greater speed, precision and agility of response can be achieved in times of crisis, for example.
In this sense, in addition, the digital transformation adds new and more developments, each of which is aimed at providing solutions in certain areas. Part of a CFO’s strategy is to choose which technology to implement based on logical and measurable reasons.
Let’s see how technology adds to the task of the finance team:
- Data visualization. Through this type of technology, finance teams not only have access to data in a more agile way; but they can also analyze them in such a way that they can give you context and add value that is relevant to the business.
- Predictive analytics. Other technologies are based on predictive analytics. It is responsible for analyzing historical data in order to identify patterns and trends in finance. All with the purpose of helping guide the business in the right direction. For example, the FP&A allows CFOs to have a tool that facilitates the analytical prediction of finances, not only based on historical data, but also based on projected scenarios, according to different variables.
- AI and machine learning. Through this technology, financial data can be managed and algorithms applied to be able to predict results and model decisions, according to the different predicted scenarios. This means that the Chief Financial Officers no longer have to spend days recreating financial models in Excel, but instead can have quick forecasts, based on 100% up-to-date data.
The modern CFO applies tools based on predictive analytics, data visualization and machine learning to their work strategies.
What the modern Chief Financial Officer (CFO) needs
Now that we have established what a Chief Financial Officer needs, let’s see some steps that must be followed for the technological growth of your professional profile.
Start up
In this first stage, it is very common to find companies that still use Excel or Google Sheets to do their financial monitoring and planning. Later, to move to more agile processes, it will be necessary to incorporate Financial Planning & Analysis solutions such as Plika.
In order to grow technologically, the CFO must recognize that working with Excel or Google Sheets for financial planning and tracking is not productive.
These softwares optimize work times, because they avoid the manual loading of data in the spreadsheets and minimize risks such as data duplication or outdated data.
Survival
In this second stage, companies are beginning to grow and show all the potential they have. Therefore, it is necessary to add a payroll or human resources management program to detect the evolution of the organization.
Although you may think that payroll software would be of more value to human resources; however, it is also a point of great interest for the Chief Financial Officer, since it is a responsibility that is directly related to the position.
This is because the salaries and the licenses that are given are reflected in the profitable efficiency of the company and it is very sensitive information regarding financial projections.
Have you ever thought about what would happen if the different departments made forecasts without taking into account what happens in other areas? Manual spreadsheets take that risk. A software that integrates the information from your ERP and the CMR with financial data, allows better forecasts.
Financial Planning and Analysis
The company’s sustainability allows it to focus on financial planning and analysis solutions. For example, FP&A software, since these provide solidity and support to the task.
In the budgeting, planning and forecasting carried out by the finance team, this type of program allows you to work with secure and updated data in real time.
On the other hand, this type of program improves the strategic performance of the business, because it allows the modeling of diverse scenarios, collaborative analysis, and accurate and easy-to-communicate reports.
Increase
In this step, the companies’ CFOs are focused on expanding their businesses. As well as having good financial planning. This is why they seek to implement technological tools that allow them to facilitate these tasks.
This to ensure that the process is easy and direct, while generating the necessary conditions for the professional growth of the team.
It seeks to leave behind obsolete processes such as Excel spreadsheets, to make way for an implementation that involves artificial intelligence, data visualization and predictive analytics, in favor of business profitability.
Move towards strategic finance with Plika
At Plika we empower finance teams and the Chief Financial Officer to be the strategic partners their organizations need. Always hand in hand with modern technology, we offer you a solution that makes the most of time, automates processes and ensures fluid inter-area collaboration.
Our FP&A software allows you to leave spreadsheets behind: avoid data manipulation and unnecessary waste of time and resources. Through this tool, you will be able to automate financial reports and involve the entire company so that they remain within the same focus.
With FP&A software, the Chief Financial Officer can enhance their strategies: streamline all processes and involve all areas through dynamic and attractive presentations.
With us you will be able to speed up your budgets and monthly deviation reports. Likewise, it will be time to implement forecast strategies and everything that could not be implemented in the organization due to lack of time.
Conclusions
As we have seen, the Chief Financial Officer is key within an organization, also with the implementation of the appropriate technology, your work can gain agility and certainty. That is, you will be able to enhance your role, making sure you make the best decisions, based on reliable data.
In modern times there are a number of tools available that are meant to make CFOs more proactively involved. Your planning and reports will not only take into account historical data, but also relevant information for future scenarios.
Do you need to start adding new resources to face the modern era as CFO? At Plika you will be able to integrate and enhance all your work as Chief Financial Officer. Take a totally free trial of our software right now.
At Plika we offer you a solution that brings simplicity and agility to the financial management of your business. Ahead!
