The responsibilities of the CFO in supporting business development have changed considerably in recent years. A report by McKinsey this year indicated that the role of a CFO is expanding rapidly.
The responsibilities of a CFO have transformed to include critical business processes. In recent years, the position has shifted toward embracing broader responsibilities such as risk management and business strategy. The role expands beyond the traditional areas to new fields such as innovation, digital transformation and culture.
Today’s CFO work with the CEO, establishing the business strategy and managing change. The range of functions connected to the CFO provides them with a vital oversight of the business and a deeper insight into the strategy. Innovation has become a critical asset of a CFO. A CFO understands how to balance creativity and financial expectations with new decisions. Concepts need to be tested and validated before implementing change and expecting progress.
The pandemic has reinforced the value of a good CFO by showing that the experience and skills of finance stretch beyond data processing. As we navigated the impacts of the lockdowns and other restrictions, forecasting cash flow became critical in ensuring a business survived, and the skills of the CFO and their supporting finance team proved vital in carrying companies through this period.
Most companies have managed to move through this challenging period and are now exploring ways to innovate and expand. This involves researching new concepts, whether introducing new tech or acquiring another organisation. The role of the CFO has once again proved pivotal in this new phase of innovation.
The role of a CFO provides more than just a reporting function. The CFO has a critical understanding of the business, as they see valuable data across the entire company and can transform data into clear and structured information. CFOs are skilled in applying advanced systems and analytics to create valuable insights into how business functions and the possible impact certain decisions could have on overall performance. An experienced CFO can determine what success looks like, critical KPIs, the required resources and the potential outcomes.
This type of information supports senior leaders in making informed decisions. It may support a final strategic decision or encourage them to invest in new technology. Whether you have an in-house CFO or hire externally, it’s evident that the modern CFO has more responsibility and influence on the overall success of a business and consists of a broader skillset to ensure companies can continue growing.