What Will the CFO Role Look Like in 2020?
As business becomes more global, regulated, competitive, and digital, CFOs can expect their role to continue to evolve. Many of them — particularly those outside high-tech industries — are still struggling to understand how to harness digital technologies to run their organizations more effectively, increase shareholder value, and perhaps even chart a future course for their own careers.
The CFO of 2020
Looking ahead, what will the CFO role of 2020 look like, and what different skills and traits might finance chiefs need to add to their toolboxes in order to excel?
First, they will need to be more digitally sophisticated and tech-savvy in order to leverage technological innovations — from the cloud to big data, data analytics, and visualization — to advance their finance agenda and finance’s ability to partner with the business.
Internet entrepreneur and Silicon Alley venture capitalist Mark Andreesen famously quipped, “Software is eating the world.” Similarly, digital technology is fundamentally changing the way business is done and the way it provides value. Five years from now, a world-class finance organization may be defined by how well it uses innovative business tools and applications that leverage technologies like mobility, software-as-a-service, data visualization, predictive and cognitive analytics, and even social media to drive cost efficiencies, identify emerging business opportunities, sound the alarm when their organization is at risk, and help course-correct corporate strategy.
For example, with predictive analytics, a manufacturing company’s finance organization can forecast results by modeling probable outcomes based on real-time inputs and variables rather than point-in-time assumptions of what the key drivers are. That means finance can produce revenue predictions based on customer-experience profiles and actual current demand instead of previous results and prior-year trends, as most companies still do today. Those are the types of business insights that would be of significant value to most any company.
Likewise, finance can employ social media and crowd-sourcing technology to expedite business processes within the finance organization, such as the monthly close. The use of these collaboration tools can drive cycle-time reduction and enrich finance’s ability to capture explanatory content on challenging issues during the close process. Read more on CFO.