CFO Digital Transformation. What is a CFO? And what is its role in the company’s journey to digital transformation? Today’s CFOs also play a leading role in digital transformation. This post will tell you more.
What Is A CFO?
CFO means “Chief Finance Officer.” It is an executive officer which handles the creation and implementation of financial strategies. It also manages the past, present, and future financial situations and actions of an organization.
Also, a CFO monitors financial statements, manages liquidity, analyses financial reports, and forecasts future cash flows within the organization.
CFO Digital Transformation
Digital Transformation is now the priority for almost every industry. And many are transforming markets through new business models and digitally enabled products.
Today digitalization grows in strategic importance. So, it will have a great impact on CFOs. This may require them to change the tools they use. Perhaps put pressure on them to fund IT projects. And possibly change their entire business model.
Aside from that, CFOs should be leading the transformation. Thus maintaining their influence within the wider organization.
Why Must CFOs Drive Digital Transformation
The following are the main reasons why CFOs must drive digital transformation:
- CFOs have the best visibility of many critical data flows. Not just finance information, but also sales, supply chain, marketing, and business performance. So, to make the right choices with digital transformation, it is vital to understand this data and how to access it.
- They have financial planning and capital allocation responsibilities. Because of this, they are most likely to be involved in digital transformation conversations. They will deal with requests from different parts of the business to help fund new technologies. Additionally, the more they’re involved and informed, the better they can balance IT requests with the need to drive overall business performance.
- And what’s most important, if they stay involved in digital transformation, this will ensure the CFO’s future relevance. Therefore they’ll be able to maintain greater control over the future of the finance team and the treasury.
The Ways Where CFOs Can Take The Lead
The following suggestions may help a CFO take the lead.
- Understand what you need. Get a discussion with leaders and other departments to identify finance pain points. Then, create a strategic roadmap. And address these points with digitalization and new technologies.
- Think beyond finance. Break down the walls between finance and IT. You have to work closely with the CIO and prioritize the digital transformation initiatives. Also, supply the CEO with insights about how digital transformation can support the company’s long-term strategy. And how to manage costs.
- Recruit the right skillsets. You have to review the existing skillset in finance. Adding new skills through training and recruitment will be the key to ensuring the treasury’s future strategic relevance.
- Lead by example. Don’t let the digital transformation happen to finance last. Instead, champion the digitalization and automation of critical tasks in your department.
- Investigate different funding options. There are many options in funding the company’s investment in new technologies. Effective finance solution helps the treasury save money. And produce additional liquidity.
- Don’ts standstill. Standing still is the biggest risk a company may face. Those that don’t embrace new technologies are likely to be left behind. In effect, CFOs and CEOs will have to live with the consequences of inaction.
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