Can you imagine a scenario in which all members of the C-suite became collaborators and best buddies? You’re probably not the only person shaking your head in comic disbelief. But that’s exactly what an expert panel believes is coming, according to a SAP Game-Changers radiocast with Greg Wright, CEO of Vantage Point Business Solutions; Ingmar Christiaens, partner in the advisory practice of Ernst & Young; and Floyd Conrad, global senior director of enterprise performance management and finance with the center of excellence at SAP.
The CFO doesn’t just run a basic cost support center anymore; he or she is a partner to the business. CFOs have evolved from pied pipers to trusted analysts at a rapid speed. Those who haven’t caught up are going to be left behind in this role revolution.
See finance’s reach expand across the business
Finance leaders are now expected to be all things to all people in every department. Conrad explained, “We have to be the data steward for all the various areas within the organization, and yet be able to establish the trust that people need to have in the department of finance.”
Validating numbers is a task of the past. In fact, that job is nearly obsolete. With so much innovative technology, data is now routinely organized, sorted out, and reliable before anyone in finance touches it. Financial professionals don’t spend nearly as much time on back-office processes.
Instead of gathering data, it’s all about analysis, which includes two parts:
1. Talking with the functional areas outside of finance and explaining what those numbers mean to them so that they can run the business better – on the manufacturing floor, in the marketing department, or on sales teams
2. Producing reports that are valid to all functional areas and creating reports that can have an impact, such as “Who do you think your top 10 customers are?”
There is so much demand on the CFOs that they have to push their IT departments to find new technology to handle all the data. The mentality borne out of a Facebook- and Instagram-savvy world is one of instantaneous gratification and knowledge. They all want their data five minutes ago, and they expect it to be correct.
Stop striving for perfection
Christiaens urged companies to have a more realistic view of their data, citing how, in an unrealistic quest for perfection, “you only get 20% to 40% qualitative data. And big companies really need to shift away [from] thinking that 100% is the target. They need to realize that if you have 80%, even 60%, nowadays, it is more than enough.”
Wright concurred, “The key thing here is [that] the relevant data needs to be correct. And the irrelevant data, it doesn’t matter.” He finds communication and collaboration to be far more important. Finance, he says, is the custodian of numbers, and the rest of the organization needs access to those numbers. So there is constantly pressure on finance to provide those numbers – typically on a tight deadline.
The panelists agreed that the CFO will be at the helm of the C-suite in years to come. Wright went so far as to refer to the CFO as “the new doctor of technology.” This shift is going to require much flexibility, patience, and collaboration on the part of the C-suite, but the benefits realized will make it all worthwhile.
Is your organization ready for the CFO-led revolution? Listen to the full radiocast to find out more.
To learn more about how finance executives can empower themselves with the right tools and play a vital role in business innovation and value chain, review the finance content hub, which offers additional research and valuable insights.