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Rachel Neaman: It’s no Longer Enough for a CFO to Be Simply a ‘Numbers Person’

Rachel Neaman: It’s no Longer Enough for a CFO to Be Simply a ‘Numbers Person’

The CFO’s role has changed tremendously over the past decade and it’s expected to be completely transformed within the decade to come. Today’s CFOs have turned into ‘jacks of all trades’ and are also needed to be masters of all, so that the integrity, profitability and sustainability of their company can be safeguarded. As such, they are constantly required to ‘up the ante’ in developing their financial, technological and ethical skills and immerse themselves in their companies’ every function. 

Rachel Neaman, Director of Neaman Consulting, spoke to Gold News ahead of the 15th CFO Management Forum about the future role of the CFO, the need to have a broader range of skills besides financial ones and the impact of digital transformation in the profession.

 

What exactly is the role of today’s CFO? How has it developed over the years?

Today, it’s no longer enough for a Chief Financial Officer to be simply a ‘numbers person’. Although the first job of a CFO will always be to get the numbers right, the role is becoming an increasingly strategic one, providing real-time insights and business intelligence to the CEO and Board alongside the more traditional functions of accountancy, P&L management and financial compliance. At the same time, in an increasingly competitive market, the CFO needs to have a detailed understanding of external trends across their industry and sector, as well of how performance within their own company is affected by these trends. The conventional view of finance as an internal-facing, back-office function is becoming subverted as companies start to transform themselves digitally.

 

What are the main skills one needs to possess in order to be an effective CFO and safeguard the profitability and sustainability of a company?

A CFO today needs a broader range of skills than traditional financial, compliance and forecasting skills. Above all, a CFO needs to understand the importance of data – the information generated by every aspect of the business operation (‘big data’), not only financial data. Apart from the CEO, the finance function has the greatest overview of the running of the whole organisation and needs access to all its data. The greater the amount of data relevant to a company’s business goals that is captured and analysed the greater the potential to find patterns and trends that will give that company a competitive advantage. For example, analysing the demographics of high-spend customers will help to target sales markets more effectively. Internally, analysing employee engagement data will help identify operational issues that if put right would make the company more productive and profitable. Aggregating different insights from a range of data sources means the CFO can provide real-time information to the CEO and Board, allowing them to react in a more agile and strategic way to trends and to develop proactive strategies to improve their competitiveness. In a digital world, using data to improve performance is not just for data scientists; it’s a key leadership capability. Management information and data, not spreadsheets and ledgers, are the key currency of today’s CFO.

 

How can a CFO adapt in the new era of digital transformation?

A CFO, like other C-suite roles, can no longer rely on others for digital know-how. Instead, a CFO needs to understand which digital tools and technologies will improve and support the business and increase its impact. This doesn’t mean that the CFO must be a technical specialist or super boffin. But it does mean that he or she needs to understand the transformative power of digital in the business context. This can range from implementing new cognitive tools to improve internal efficiency and reduce repetitive manual processes, to analysing revenues and using predictive analytics to forecast success in new markets. Instead of a separate digital strategy, delegated to a back-office IT team, organisations today need a business strategy that’s fit for the 21st century with digital at its heart.

 

What are the main challenges currently facing a CFO?

Digital technologies are rapidly disrupting how organisations do business and how consumers and customers expect to interact with them. This has a knock-on effect on the business strategy and the way organisations function operationally. Understanding how to harness the benefits of digital disruption and mitigate its risks is a key challenge for the CFO, as is balancing the need for short-term investment in new technologies and ways of working with the long-term financial success of the organisation. Making the right investment decisions in a digital world requires a new mind-set with a more agile and integrated approach, focusing on trying things out, using pilots, rolling out things that work and quickly stopping things that don’t. This means aligning business goals with IT, trialling new systems and ways of working across organisational silos, and automating repetitive manual processes to allow humans to do higher-value work. Investment strategies for digital transformation are focussing more now on strategic opportunities, such as improving customer experience, competitive differentiation, and new products and innovation, than purely cutting costs.

 

How do you expect the role of the CFO to develop in the years to come?

I expect the role of the CFO to continue to broaden out from an inherently internal function to a more proactive and strategic one. This increasingly strategic role will be based more on real-time analytics and business insight than on conventional accountancy and spreadsheets. While traditional financial management will of course remain vital, knowing how to unlock the data and insights that will help a company make the right strategic decisions in an age of economic uncertainty and political change is becoming progressively more essential. But key to harnessing the value of data and insights is turning them into realistic actionable plans with measurable outcomes.

 

You will be speaking at the 15th CFO Management Forum on June 20. What is the significance of this conference and what will your presentation focus on?

I am delighted to be speaking at the 15th CFO Management Forum on 20 June. The conference comes at a time of global economic insecurity and increased regulation which is putting additional pressure on the role of the CFO. At the same time, developments in digital technology are leading to major shifts in consumer expectations, business models, and ways of working that are creating a host of new opportunities. It is essential for CFOs to understand how these macro changes are affecting their own organisations if they are to remain competitive and financially successful. Finance is by no means immune from change and will continue to be disrupted by big data, robotics and machine learning as digital technologies develop further. The CFO needs to lead the executive team in becoming truly tech-savvy. I will be talking more about the tech-savvy CFO at the conference and look forward to seeing you there.

 

About the 15th CFO Management Forum

EY presents the 15th CFO Management Forum which will take place on Thursday, June 20, 2019 at the Hilton Park Hotel in Nicosia. The CFO Management Forum will provide a platform for the attendees to share expertise, build knowledge and network, as well as debate, discuss, and seek practical solutions to the industry’s challenges. The stellar line-up of international speakers will present their views on what it takes to be an effective CFO, the Digital Transformation of the CFO, as well as Effective reporting and Business Analytics.

The CFO Management Forum is an annual event that provides attendees with a platform to share expertise, build knowledge and network, as well as debate, discuss, and seek practical solutions to the challenges today’s CFOs are facing, as well as the challenges of the next decade. The Forum will combine entertainment, a networking barbeque and drinks session, as well as the 3rd Cyprus CFO Awards. These awards recognize professional excellence in the field of Financial Management in Cypriot Corporations and present renowned people in the industry with awards for their contribution and/or achievements in the field of finance and business.

For more information regarding the event and this year’s topics, please click here.

Attendance of the Forum is by invitation only and is addressed to CFOs, CEOs, Managing Directors, Finance Directors, Finance Managers, General Managers and other senior executives from investment firms, accounting, audit and tax firms, fiduciary service providers and banking/financial institutions.  Representatives from relevant governmental services are also welcome.

 

Forum’s Details

Organiser: ΙΜΗ

Main Sponsor: EY

Sponsors: Hellenic Bank Public Co Ltd, JCC Payment Systems, A.I. Motokinisi Limited the official importers and distributors of Porsche Cars in Cyprus, Supernova Consulting

Networking Cocktail Sponsor:  A.S. Xinaris & Sons Ltd

With the Support of: Institute of Certified Public Accountants of Cyprus (ICPAC)

Communication Sponsors: Accountancy Cyprus, GOLD, IN Business

For further information regarding the event and registrations please contact IMH: Tel.: 22 505 555, Fax: 22 679 820, E-mail events@imhbusiness.com

Website: www.imhbusiness.com

 

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