With CFOs holding the top financial position in an organization, they are tasked with the critical role of managing, protecting and forecasting the financial stability for their company and employees—a job made only more pivotal when faced with uncertain economic times brought on by a pandemic and other global crises.
Traditionally, CFOs are tasked with maintaining the books, reporting on financials and statutory compliance, and other financial processes. Today’s new reality has accelerated changes to the role: Finance leaders now are at the forefront of the business, guiding strategic and critical decisions.
Skills and qualifications that were once considered a bonus have quickly transformed to requirements for the modern day CFO, including:
No. 1 — Side-by-side collaboration with CTOs and IT to drive tech adoption and automation
CFOs know they need to invest in digital technologies that make smarter and faster decisions in order to compete in today’s environment.
Finance and IT departments used to work completely separate from each other, but a transformation has occurred with the two divisions now teaming up to ensure the right automation decisions are being made—resulting in time saved across budgeting, resourcing and reporting.
Now, the finance leaders that are performing best have transformed their teams to be a co-pilot alongside IT teams to synthesize the data that makes for faster decision making empowered by strategic insights. That’s why baking resilience into finance through technological investment and process innovation is key for future proofing business operations.
In fact, the adoption of technology by large companies has nearly doubled as a result of the pandemic.
No. 2 — Planning for the “unknown unknowns” and responding to risk
The pandemic forced CFOs to expand their view of potential risks. Today’s CFOs had never lived through a global pandemic before, and they were forced to evolve their definition of financial risk—in every sense.
The unforeseen circumstances forced finance leaders to take on crisis management tasks such as leading key decisions about investment, budgeting and expense control and guiding corporate strategy while simultaneously navigating a rapidly changing landscape and turbulent economy.
Financial leaders supported the transformation of remote work, including securing new equipment to support remote work environments, investing in secure systems for long-term hybrid work, managing a dispersed workforce (many operating across state lines where before everyone was in one location), and modeling more efficient and streamlined operations.
Companies now expect much more from their finance leaders. Whether it be reducing duplicative efforts that waste time, planning for new revenue streams, or finding ways to better prepare for unforeseen expenses, their analysis of current financials is critical in facing economic uncertainty. They now need to be better equipped to expect the unexpected.
Finance leaders can help their business be as prepared as possible for any eventuality by guiding a company’s contingency plan and ensuring health and accurate financial reporting.
No. 3 — Evolving from CFO to cross-practice leader
The most successful CFOs sit in a seat that collaborates and works alongside the rest of the company and other divisions. The seat of a CFO comes with a unique perspective on the health of a company—one into which other executives might not have the same access.
Given the time of year, these elevated activities include meeting compliance requirements and demands across evolving tax policies and sanctions and understanding their impact on business forecasting and profitability. The CFO understands better than anyone where the company’s financial strengths and weaknesses lie.
This very perspective is why we are seeing more and more companies turn to their CFO as the next CEO, with Peloton and Hertz as the latest examples. CFOs must interact with other divisions and really understand the business to be able to modernize processes that enable the growth trajectory.
Put more simply, the CFO role has been reimagined to be the center of influence for a company’s growth and expansion plans.
The most equipped CFOs are those that manage risks as part of life’s uncertainties, and also see these moments in time as opportunities. To address these challenges, the CFOs of today and tomorrow must expand their collaboration across all departments, examine circumstances or consequences we cannot predict to better prepare for future events, and, above all, ingrain in their colleagues a perspective that is open to invention and innovation.
Chen Amit is co-founder and CEO of Tipalti. Chen is a veteran high tech executive and repeat entrepreneur. Prior to Tipalti, Chen was CEO of Atrica, a Carrier Ethernet company that Nokia-Siemens acquired. Before Atrica, He was co-founder and CEO of Verix, a provider of business intelligence software. At ECI Telecom, Chen founded their ADSL business unit and led it from inception to $100 million in annual sales. He earned a BSc from the Technion, Israel Institute of Technology and an MBA from INSEAD.
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