Reshaping the CFO Role – CFO
Surveys performed right before and throughout the pandemic show the coronavirus disaster could be reshaping the job of the CFO, with senior finance executives shifting their concentration to crafting strategy and producing business value.
CFO Investigate (portion of Argyle Advisory and Investigate Expert services) and Grant Thornton surveyed 631 CFOs and other senior finance executives in February, then adopted up with a study of 174 CFOs and senior finance executives in May well, to gauge the consequences of the COVID-19 upheaval.
Other than the changing concentration of CFOs, the surveys revealed widescale delays for innovation tasks, a renewed appreciation for business strategy techniques, cybersecurity price raises, and like for innovative analytics and synthetic intelligence.
Roles and Tasks
The February and May well surveys showed that the job of the CFO shifted when the pandemic hit. In both of those surveys, the executives ended up requested how considerably of CFOs’ time would be expended in these 4 roles: strategist (crafting corporate strategy) change agent (producing business value) producer (standardizing and automating transactional processes) and guardian (standardizing command and compliance processes).
In February, the study respondents reported that CFOs’ time was divided comparatively similarly throughout the 4 roles. But by May well that stability had shifted in response to the COVID-19 disaster: strategist and change agent roles ended up taking far more of CFOs’ time compared with the producer and guardian roles.
Even with the obvious change to far more ahead-on the lookout jobs, the coronavirus forced a significant vast majority of CFOs to place off or change their programs for innovation tasks. 8 out of 10 surveyed finance executives had delayed or reshaped innovation tasks in May well. Sixty-two percent of the respondents reported that the COVID-19 disaster had delayed their transformational tasks whilst 19% said the disaster had reshaped their tasks and they ended up pursuing a various approach. The remaining 19% reported that the disaster had accelerated transformation tasks.
Delaying and reshaping innovation tasks doesn’t mean they are extinguished. More than ninety% of 335 finance experts polled throughout a Grant Thornton webinar in June said they prepared to proceed to innovate, even throughout the COVID-19 downturn.
Automation Stays the Study course
Highly developed analytics and synthetic intelligence ended up favored categories of automation engineering in both of those the February and May well surveys.
A vast majority of the executives in the May well study reported that their programs for applying automation technologies had not been delayed by the pandemic. More executives slated innovative analytics for accelerated implementation (29%) than they did any other group of engineering. Synthetic intelligence was a near next at 23%.
The February study had requested executives when they expected to put into action a list of specified automation technologies. Most respondents (fifty five%) had by now applied innovative analytics. Optical character recognition was the next-most-by now-applied automation engineering, at 40%. Synthetic intelligence had the highest percentage of prepared implementations in just twelve months (33%), adopted by robotic procedure automation (thirty%).
In a December 2019 economic downturn preparedness study by Grant Thornton, 70% of respondents reported programs to improve their digital investments in innovation/engineering, digital transformation, and/or cybersecurity, even amid escalating signs of a slowdown. In the February CFO study, about 70% of the senior finance executives reported they had both applied important rising technologies or they would be applying them in just two decades.
When requested in May well about how bills would change around the following yr for the reason that of COVID-19, cybersecurity had the highest percentage of executives projecting raises (44%) adopted by IT/digital transformation (40%), coaching and advancement (22%), functions (21%), and marketing (19%). Not incredibly, the categories with the lowest projections for price raises ended up vacation (4%), true estate (6%), recruiting (seven%), and workforce (seven%). Ninety percent of the executives projected their vacation bills would lower.
Like for Company Approach
Fitting with the discovering of CFOs looking at by themselves in far more strategic roles throughout the pandemic, the finance executives surveyed held business strategy techniques in high regard.
They saw business strategy as an vital skillset both of those right before and following the onset of the pandemic. Functions administration techniques ended up almost as valued as business strategy techniques in the pandemic disaster environment. When finance executives ended up requested which vital ability they had leveraged for the reason that of the coronavirus disaster, the most-cited remedy was business strategy, selected by 34% of the executives, adopted by functions administration (29%). Facts analytics and innovation/entrepreneurship ended up tied as the third-most-cited leading techniques drawn on throughout the pandemic, at 10%.
The February study requested a related problem — what ended up the most vital skillsets respondents would like to acquire in just their finance functionality? Facts analytics and business strategy ended up the most-cited solutions, by 23% and 22% of the respondents, respectively, adopted by application advancement (seventeen%) and purchaser experience administration (11%).
Other Impacts
There is no doubt that business strategy advancement was not the only extra accountability for CFOs arising from the pandemic-induced economic downturn.
Amongst the quick-time period priorities and long lasting impacts of the pandemic, the executives in the May well study independently outlined:
• reduced capex
• the likely to buy significantly less-nicely-capitalized providers
• reduced dollars movement impacting personal debt covenants
• resource prioritization in the deal with of constrained provide chains and
• extensive-time period implications of an progressively cell workforce on workplace room, recruiting, and vacation.
Most of people impacts will proceed to have a significant impact on what CFOs devote their time on in the coming months. Respondents said they ended up looking at CFOs branching out into new areas of organizational management, these types of as major production and processes, managing layoffs and shuttering functions, performing with business models to set up numerous production sources, managing remote workforces, partnering with the group, and interacting with investors.
Within just the regular scope of finance, new areas of concentration for some finance chiefs involved acquisitions and divestitures, moves to protect dollars and means, coronavirus economic-affect products, expenditure danger, forecasting and budgeting, payments and dollars movement administration, danger mitigation, liquidity administration, profits advancement, and expense reduction. Paycheck Safety Application documentation and examination also appeared on the list.
Amongst the new areas of concentration in just engineering management, finance executives outlined moving all capabilities to paperless, applying get the job done-from-residence technologies, and overseeing IT and protection.
And a person government outlined a-not-unfamiliar CFO job:
therapist.
Keith Button is a freelance writer primarily based in Valley Cottage, N.Y.
