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OPINION: CFOs: embrace change for success

A CFO is uniquely able to take an investor’s perspective and look at the business from the outside in, to challenge strategy from a risk perspective and look at all key decisions through a value lens.
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Laurie Bissonette, FCPA, FCA, is a partner with KPMG Enterprise.

Times are changing. These days, it seems like the only constant in business is a rapid pace of change, whether related to regulations, technology, or even client and employee expectations. While chief financial officers (CFOs) can often help their organization navigate change to stay competitive, the role of the CFO is evolving, too, making it difficult for organizations to fill this challenging role in an effective way. I know, because I’ve been asked many times by businesses to help them find the “perfect” CFO candidate in the last year. I’ve got my eyes open for that person right now!

This role is in demand because a successful CFO can help provide support and strategic input to manage organizational change. A CFO is uniquely able to take an investor’s perspective and look at the business from the outside in, to challenge strategy from a risk perspective and look at all key decisions through a value lens. CFOs can also mitigate risks by looking after the company’s assets and cash flow to help limit the company’s exposure at times of crisis.

However, some organizations underutilize their CFOs and don’t even realize it. While a recent KPMG survey found that some organizations increasingly want their CFOs to concentrate on growth and strategy, the finance function is sometimes structured so that anyone filling this role is instead forced to deal with the daily demands of tax and financial compliance, in addition to having to stay on top of technological innovations and mentoring a team of individuals.

The survey, for which KPMG teamed up with Forbes Insights, collected responses from 178 chief executives, business owners and chairmen of large companies. Here are a few key findings about their changing views and expectations on the finance function, including thoughts related to the future of the CFO:

  • Almost 75 per cent of CEOs and business owners believe the CFO’s role will increase in importance in the near future, compared to other C-level roles.
  • Almost 50 per cent of CEOs place the most value on their CFO’s growth-oriented initiatives and the least on traditional areas of the finance function.  
  • Technology will be a make-or-break test for CFOs, as more than 60 per cent of CEOs believe that a CFO’s ability to leverage technology will have the greatest effect on the future role and success of a CFO.
  • CEOs put a huge value on people skills. Eighty per cent of CEOs say that talent management is critical and CFOs could do a better job of managing their teams.

From these survey results, it’s clear that any potential CFO candidate must be ready to get more involved in an organization’s strategy. We hear that “bean counters” give you the results but don’t help you grow – the right CFO could be critical to ongoing success! In the coming years, a CFO’s focus will likely shift from reporting the past to more of a predictive analyst, using financial information in planning and strategy.

Technology, including powerful data analysis tools, will play a key role in this shift. The evolution from ledgers to spreadsheets, and to enterprise software and automation, have paved the way for the modern financial guru, and allowed finance teams to play a more strategic role within their organizations. In the future, CEOs will expect their CFOs to continue to leverage new technologies to take advantage of evolving opportunities and transform financial data into intelligence that can help grow the business.

This career can be a wonderful and challenging one; successful CFOs should not only be ready to help their organization evolve, they must be prepared to embrace change in their own roles. Because as times inevitably change, it’s important to change with them.