Redefining the role of CFO beyond the ties of COVID-19

Role of CFO

The setbacks experienced as a result of the COVID-19 pandemic have been unlike any seen before. The impact seen on the financials of industries and organisations across the globe has been unprecedented – with many not surviving to this point. Globally, CFOs and finance teams have been hard at work to lead their organisations through the immediate crisis, ensuring the safety and protection of employees, suppliers and key stakeholders. They have also been collaborating across functions, assessing liquidity and conserving cash and reaching out early and often to investors to reset performance expectations.

For those who have managed to transcend the global lockdowns into recovery phase, a new reality has very quickly come to the fore. One that, particularly for the CFO, requires a new, agile way of thinking. Drawing lessons from these unsettled months, the CFO must now permanently build speed and flexibility into functions that encompass forecasting, planning and resource-allocation processes and incorporate new tools and rapid decision-making protocols into the finance team’s day-to-day work.

Experience has shown that whether the challenge is rooted in growing revenue or allocating resources, technology is the shortest path to better, more confident action. But to bring technology to life, we must invest in our people. Taking on the notion of ‘Tech Intensity’ – which is an organisation’s rate of technology adoption along with its ability to build its own digital capacity, as we enter recovery and reestablishment, we encourage CFO’s to take risks, learn, educate and as a result, feel comfortable enough to embrace change beyond COVID-19.

As organisations start to discuss the return to the physical office space, remote working and hybrid working environments will remain at the centre of operations. Employees across all functions will continue to work remotely using modern workplace collaboration tools and organisations will therefore need to invest significantly in workforce engagement and training in new skills. CFO’s will also need to consider making a significant shift from fixed capital costs to variable costs by leveraging “as a service” models like Microsoft’s Azure SaaS, PaaS and IaaS, employing technology driven methodologies to foster cost transparency.

No one could have predicted a global pandemic and the ramifications thereof 12 months ago and while forecasting and scenario planning serve exactly that purpose – taking into account market fluctuations, disasters and the like, it naturally did not factor in the kind of impact the pandemic has seen. Moving into an era of ‘Modern finance’, CFO’s must embrace advanced analytics to move from backward-looking analysis to future-looking predictions and recommendations. Machine learning is a critical tool for predicting outcomes and managing risk and solutions like the Cortana Intelligence suite allows organisations to stay ahead by turning gathered data into actionable insights. 

CFOs will continue to face an ever-growing risk landscape because of many factors, including geopolitical turmoil, regulatory reforms, market instability, and cyber threats. However, moving forward into the modern finance era will require taking an ever-larger role in risk management that goes beyond traditional financial risk and compliance. The virtualisation of the workforce and remote working could increase vulnerability to cyber risks, including data theft, ransomware, and other attacks. The layoff of staff and cost reductions could also increase vulnerability to failures of internal controls, due to stretched, disengaged, or ill staff. Lastly, organisations may have to revisit the internal audit process and incorporate more data analytic tools in assessing the risk landscape.

Leveraging and effectively harnessing the power of the cloud, CFO’s can create early warning systems and tools that will enable them to proactively manage risk. For example, using solutions in the Azure stack, CFO’s can build a risk analytics platform to provide comprehensive coverage of all sales transactions, with predictive machine learning based capabilities. As a result, driving a systematic review process and focusing on high-risk transactions.

With no doubt, CFO’s will continue to face significant challenges to confidently make the next best decision for their company, their team, or their customers. In the coming months, we will continue to see many organisations adapt to the new reality that has presented itself in the wake of uncertain times. As an industry, we encourage and will continue to do so – addressing those challenges with technologies that will enable CFO’s and the organisations they represent to operate effectively. 


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