The rules of the game have changed for CFOs. Today’s finance chiefs continue to move from number-crunching and spreadsheet management to strategic decision-maker – from reporting on historical performance, to driving future decisions.
And why not? With more access to data across the business than any other organizational function, CFOs are best positioned to bring to light valuable insights from their unique view.
But as many finance leaders are learning, there are significant organizational challenges to overcome before they can assume a more strategic focus. Outdated and inefficient financial processes, a lack of time for reporting and analytics, and data silos can prevent finance teams from becoming the go-to source for operational and financial performance data that can help decision-makers successfully guide the business.
Today’s most forward-thinking CFOs are overcoming these obstacles to becoming a strategic influencer through a three-phase finance transformation approach.
1. Process: A well-defined process consists of clear and measurable goals, ensuring that employees across all business functions clearly understand their responsibilities and maintain focus on the most valuable tasks. Such a process also includes presenting performance data in visual dashboards that employees outside of finance can understand and an automated financial process that allows finance to focus more time on analyzing data.
2. People: Good communication and collaboration are important to all business functions, and finance is no exception. From a finance perspective, cross-functional collaboration is an important element to helping different functions within the organization understand how they relate and interact in a way that’s quantifiable. The more people across the business involved in the FP&A process, the greater sense of ownership and accountability there is for financial plans and budgets.
3. Data: At the end of the day, it’s about getting the most value possible out of your data to create a better future for your business. This can only happen once a business has a consistent way of gathering data across all functions. With such a standard in place, leaders from multiple departments can have conversations about the data without worrying about inaccuracies or communication barriers. It’s the most effective way to create a governance framework and define key drivers and metrics that everyone can strive to achieve.
Our CFO Indicator Q4 2016 report reveals that while 85% of CFOs say their teams have direct access to the financial and operational data needed to generate accurate reports, it is the non-value-added tasks—like data gathering, verifying accuracy, and formatting reports—that take time away from the strategic analysis desired by top management and other stakeholders. Most CFOs also cite data integration as the biggest technology hurdle to gaining actionable reporting information, given the increasing need to report on both financial and operational data typically housed in disparate, unconnected systems. Read our other CFO Indicator reports here.