A survey from Deloitte, “2015 report on America’s economic engine,” found that in the U.S., the confidence in the economy among execs in midmarket companies is high. Compared to Deloitte’s last report in late 2014, other key findings include more expected funding for various functions: technologies such as cloud computing (58% vs. 46%), data analytics (53% vs. 40%), and automation of business processes (43% vs. 24%). More than one-third of respondents also predict the economy to grow by more than 3.5%. Moving into 2016, what other trends should the CFOs of these companies be aware of?
While some research has found that some 41% of midmarket companies are aggressively pursuing M&A as a growth strategy, investing in technology also continues to promise steady growth by driving productivity. Here are four trends in the use of technology that can gain the CFO mileage and efficiency.
Automate and simplify: CFOs of midsize companies need to stay abreast of the technology supporting automation and simplification, because this could offer them a gateway into competing with much bigger companies. Thack Brown, general manager and global head of Line-of-Business Finance at SAP, shared some insights on CFO opportunities in this article, noting that automation is the next big thing that should be on CFOs’ radar screens. What this means is that CFOs need to start thinking more strategically about transferring resources out of the back office – through automation – and focusing on people, talent, and skills for the front office. Embracing automation will allow CFOs at midmarket companies to hone in on generating higher-value work in the front office while also cutting costs.
Get your metrics right: Wouldn’t it be great to constantly have a finger on the pulse of your company? To do this, key metrics like operational performance, costs, and revenue need to be tracked live. There are many data visualization tools out there that can help the finance team track, plot, and visualize these metrics. Once the tracking system is in place, compiling and sharing regular updates with key stakeholders keeps everyone on the same page.
Smarter, sharper enterprise strategy: A cohesive enterprise strategy – where cross-functional planning can be rolled out – is critical to the success of any company. Midsize companies have that added advantage of a relatively faster implementation time because of their smaller size. CFOs can take the opportunity to drive this process integration between the various functions in the firm, so that expectations and goals can be aligned in a more streamlined way.
Close the informational black hole: With the data avalanche that plagues most organizations these days, having a tool to sift through and visualize the mountains of data in an easy-to-understand way can make a great difference. CFOs can help drive the search for insights by advocating and executing a holistic and consistent platform for data collection and interpretation. With more clarity around data, midsize firms can derive more powerful insights to make more informed business decisions, and CFOs can play a central role in driving this.
To put it in the words of another thought-leading article: “To compete in the digital economy, companies cannot afford to sit back and wait to mimic what these leaders accomplish. By that time, the pioneers will have started blazing a new path.”
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.