The role of the CFO has evolved from managing compliance and accounting activities to providing strategic leadership and driving digital transformation. As finance enters the CFO 3.0 era, CFOs need tools that enable them to deliver on their core competencies, and to be confident in driving the digital agenda throughout their organisation.
CFOs are no longer simply signing off budgets for digital acquisitions at the request of the CEO or the chief information officer (CIO). They have become active participants in the digital strategy of their organisations. CFOs are supporting innovation as they adapt to a fast-changing work environment that relies on technology to provide data and analysis for sustainable growth.
According to Sage research, senior South African financial decision-makers acknowledge that managing a remote workforce and leading a business through lockdown and social distancing has weighed on their minds for most of the year. All the trends that were at play before the pandemic – the move to cloud, managing remote workers, and getting on top of compliance – have been accelerated.
As finance enters the CFO 3.0 era, CFOs need tools that enable them to deliver on their core competencies, and to be confident in driving the digital agenda throughout their organisation.
Demand for strategic decision-making
Finance decision makers are seeing their role transforming from number cruncher to business strategist. As a finance leader, you now have a new mandate: to move beyond the traditional role where you measure past performance to leading your business as a gatekeeper of data and analytics.
The insights this provides will help create a vision for the future of the business, which CFOs can then start to plan and forecast for. The CEO may expect the CFO to guide the business through an uncertain future, to provide strategic direction on digital spending, managing risk, imposing governance and responding to regulatory change.
It is the CFO’s opportunity to take the lead in digital transformation, redefining the finance function to play a more significant role in data governance, data flow, cyber security and other business priorities.
A younger workforce with new priorities
According to Stats SA, the youth (aged 15–24) constitute almost a third of the population (18 million) in South Africa. With millennials taking up more senior roles in enterprises and more members of Generation Z moving into the workforce, new technology priorities are starting to emerge.
There is a divide between senior accountants and new accountants who use technology to automate basic number crunching and admin tasks. Most new breed accountants will have implemented cloud-based technology three to four years ago, while the others will have only acquired cloud-based systems in the past two years.
Finance decision makers are seeing their role transforming from number cruncher to business strategist.
Finance is becoming increasingly technical and strategic. To strengthen their position as a strategic business leader, CFOs must look at a few ways to make sure their organisation manages and analyses data thoroughly, optimising information flow to ensure KPIs are being hit. They could do this by harnessing the value of a young tech-savvy workforce, that will naturally accept what you’re trying to do.
South African CFOs are embracing technology in the finance function as a lever for improving performance. Some 90% of senior financial decision-makers have adopted emerging technologies in some form. Many report they are hands-on with their companies’ digital transformation strategy – and approve the spend.
The digitalisation of the finance role
Digital technology is pulling finance in exciting new directions as real-time, digitally-fuelled and data-driven competence. Nine out of ten South African CFOs today play a role in their organisation’s digital strategy, with 15% being fully responsible for digital transformation.
With automation, it is now possible to aggregate a vast amount of data to unlock insights. With data-driven insights, CFOs and senior finance professionals are better equipped to be a strategic advisor for their business, focusing on generating value for their organisations.
With just a little over half of the respondents stating most processes are automated in their businesses, this suggests that a massive shift is still coming – especially with over 80% of CFOs believing that financial management technologies can help their businesses to discover new opportunities and better manage risk.
Building a culture of automation can increase your productivity, result in fewer errors and faster processing times. Automation encourages quicker business-wide decision making while improving regulatory compliance and ensuring accurate financial statements.
AI holds no fear for senior financial decision-makers: over two-thirds are not at all concerned about AI, and only one in ten believe AI will impact jobs. In fact, nine out of ten CFOs welcome automation performing more of their day-to-day accounting tasks in future, and 40% believe AI and machine learning will improve forecasting and financial planning even further.