One of the main drivers behind the rise of the digital CFO is the development of new, modern financial management systems. In particular, ERP systems offer unparalleled data collection and analysis capabilities.
As a result of powerful integration capabilities, this is an even bigger project than it appears at first glance, requiring inputs from various departments, including finance, accounting, marketing, sales, and operations. The digital CFO is at the center of all of this: a CFO who understands and appreciates technology, owns the ERP project, and may be the catalyst for systemic change.
The Role of the CFO Has Changed
CFO roles remained virtually unchanged during the middle of the 20th century. Today, CFOs deal with computers, cellphones, and financial management systems unheard of in the 1920s.
CFOs today also oversee a technology team that analyzes an array of ERP systems. Instead of waiting weeks for inventory reports to trickle in, a CFO can summon a dashboard displaying the latest item counts with a button click. Instead of searching for the correct file and estimating based on its creation date, a decision can be made using the figures at hand. Cloud ERP ensures that data is available, accurate, and close at hand at all times.
As the CFO’s role has grown, it has evolved from one of function to one of strategy. CFOs may be equally comfortable in front of the computer screen performing functional tasks and advising the CEO on company direction. Digitally savvy, most have a hand in marketing, technology, and anything else that interests them. Today, they are more responsible for financial management systems than ever before.
8 Key Skills for Today’s Digital CFO
There are eight critical skills that today’s digital CFOs must have.
- Strategic Leadership
CEOs expect much more from their financial leaders as the CFO role evolves into the digital CFO. The CFO must provide strategic insight and bring these insights to the C-suite table. CFOs are often seen as trusted advisors, giving advice, and providing insight into the inner workings of a company.
This new breed of CFO understands the data they control offers an excellent opportunity to provide the CEO with important information. A CFO is often as knowledgeable as the CIO about the details of the financial management system and can give leadership proactive advice based on this information.
- Creating Value with Data
A piece of data is worthless on its own, and a business can only benefit from it when it is transformed into meaningful information. A digital CFO must be skilled enough in the system’s inner workings to generate reports that provide the best information to the team, assisted by financial management systems. Using this data, a digital CFO can provide expert insight and opinions to help sales, marketing, and operations.
- Automated Labor
In addition to consulting on financial management systems, today’s digital CFOs also consult on other automation methods. Manufacturing companies considering automation may consult with their CFO to discuss the financial aspects and the integration with their ERP system. The digital CFO must also understand and use other methods of digitizing labor, from robotic warehouses to time-saving software.
- Collaboration Across Departments
In addition to becoming more involved in the company’s data, the digital CFO must become a cross-functional expert, able to collaborate with all departments. Managers turn to them for expert insights and data resources that can help paint a clearer picture of progress toward KPIs, much like the CEO. For this reason, the new, modern CFO must understand all departments and teams.
- Digital Security
Cybercriminals often steal credit card data, personally identifiable information, and much more. Most companies store this data within their ERP systems or financial databases. As a result, the digital CFO must also be knowledgeable about cyber security and understand how cybercrimes occur and how to prevent them. Many CFOs manage a company’s online security as well as a company’s internal controls within the accounting department.
- Communications Expert
Unlike their predecessors, today’s digital CFOs don’t just hide behind a ledger. Although not required to be extroverted, they should be comfortable communicating with a wide range of people. They must be capable of providing public presentations, gathering financial management data, and converting it into useful information for audiences with different levels of financial knowledge.
- Expert in Financial Management Systems
It takes more than financial expertise to be a digital CFO. CFOs today are expected to be systems experts in financial management systems. While most ERP implementations include training for an in-house data expert, the CFO typically acts as this expert to ensure their staff can utilize the system to the fullest potential. The ability to use computer technology effectively and the curiosity to learn are prerequisites for this job.
- Cross-Team Understanding
With cross-team collaboration comes cross-functional understanding. To achieve the company’s KPIs and bottom line, the digital CFO must work with other departments and understand what they do. Through this understanding, the digital CFO can harness the powerful data generated by the ERP to provide the strategic insight and direction companies seek, bringing us back to the first aspect of the digital CFO’s role.
The Super CFO
This digital CFO’s resume isn’t quite what you would expect. Many CFOs possess all these characteristics and quietly go about their tasks as if it’s nothing special to be a superhero.
As digital CFOs, it’s time to have an ERP that matches your skills. Let us help you define the system that will determine your success. Contact us today.