The Modern CFO’s Guide to Technology and Automation

As the role of the modern chief financial officer (CFO) evolves, so does the way in which they shape how companies operate and thrive. CFOs are in a unique position to drive their organizations toward innovation and efficiency with the latest financial technologies. However, with the vast expanse of technological options and the fast pace of digital transformation, it’s difficult to navigate the options without becoming overwhelmed.

If your CFO feels more at home reviewing financial statements rather than software spec sheets, you may need guidance in vetting which technology to prioritize. Without the right solutions, you forfeit increased efficiency and a distinct competitive edge. This is where an outside expert, from Growth Operators can prove to be a valuable investment.

This article offers insights and strategies for CFOs aiming to expand their abilities and align their technology investment with their company’s long-term objectives. It also makes the case for recruiting a technology expert to revamp the way your company approaches its accounting and finance technology.

The CFO of the Future: 3 Features

A Chief Financial Officer is central to the success of any organization. However, organizations are changing, and effective CFOs will need to change with them.

To shine a light on what changes may be in store for the CFO position, Billtrust commissioned Paradoxes, Inc. to conduct an extensive qualitative and quantitative study between 2021 and 2022. The study encompassed interviews and sessions with over 500 financial professionals. This included both current CFOs and those on track to take a CFO position.

The research defined how the future role of the CFO is being significantly reshaped. Much of that is a result of the evolution in business strategies and operations that many companies have undergone over these last few years, some of them in response to massive disruptions like COVID-19 and hybrid work environments.

We’ll outline those features we’ve identified as essential in the CFOs of the future:

1. Managing “Horizontally”

CFOs must manage “horizontally”, working in more direct collaboration with other business units beyond the traditional boundaries of the CFO’s office.

2. Data-driven

CFOs should have the ability and desire to see the “whole picture” instead of just the financial facets of the business. An interest or level of comfort in data analysis/analytics is expected.

3. Externally focused

CFOs that can orient their activities toward external-facing goals like customer satisfaction, planning, and data analytics will find greater success.

Embracing Technology to Enhance Team Capabilities

A McKinsey & Company report highlights the importance of fostering an innovative culture in companies. It found that innovative organizations give business leaders access to more robust, real-time data to help them make decisions quickly. It also suggests that these companies are eight times more likely than their less innovative competitors to move beyond simple automation to technologies such as generative artificial intelligence (AI).

Given the benefits of emerging technology, CFOs should think proactively about how advancements could impact corporate functions within their companies. The goal with adopting and upgrading technology is not to replace human teams but to augment their capabilities. For example, implementing an accounting software upgrade that enables accounts to do more while minimizing human error frees them to focus their attention in the areas that will grow the company.

The right technology will automate tedious tasks, streamline processes and provide real-time data insights that empower CFOs to:

• Boost Efficiency and Productivity: Cloud-based accounting software, automated workflows, and data visualization tools free up valuable time for finance teams so that they can focus on strategic initiatives.

• Gain a Competitive Edge: Industry-specific platforms can automate processes unique to your sector, giving you a faster time to market and a sharper edge over competitors.

• Drive Innovation and Growth: Emerging technologies like artificial intelligence (AI) can unlock new revenue streams and business models that propel your company forward.

The Three Phases of Technology Planning

CFOs looking to match the business objectives of the company with the right finance technology (FinTech) should take a three-tiered approach. Remember, there is no one-size-fits-all solution. While the vast array of options available can be daunting, the right expertise can help you make sound decisions that accelerate accounting processes, facilitate better decisions and protect financial data.

Build on your existing technology infrastructure with these steps:

1. Core Technology Plan: Start with the essential tools needed to run your company efficiently. This might be basic accounting software or include cloud-based Enterprise Resource Planning (ERP) systems that streamline processes.

2. Industry-specific Platforms: Next, incorporate platforms that are tailored to your industry to accelerate processes and improve productivity.

3. Innovative Platforms: Finally, explore new platforms that offer innovative service models and opportunities for corporate innovation. Examples include predictive and generative AI technologies.

Strategy, Compliance and Security

Technology brings immense value, but it also comes with inherent risks. The modern CFO should factor in risk management and compliance measures with any technology decision.

Cybersecurity threats are ever-present and partnering with your IT department throughout the technology selection and implementation process is crucial. Strong cybersecurity protocols are essential to ensure that new technology doesn’t create vulnerabilities in your company. This may include training employees on proper use as well as how to identify signs of cyber attack. If you haven’t adequately addressed data security in the past, now is an opportune time to review how you organize your finance data and address present and future security gaps.

Additionally, ensure that your existing ERP system is secure and can keep up with changing technology. If it can’t integrate with new technologies like predictive and generative AI, it may be time for an upgrade.

In all, investing in new technology requires a solid foundation that lays the groundwork for future technological advancements. Have a clear vision around your needs and build a future-proof FinTech stack that allows you to integrate new technologies as tools and trends evolve.

The Value of External Technology and Automation Expertise

Given the complexities of technology integration and the planning required, enlisting the help of an outside expert can be invaluable. A financial technology expert can:

• Assess your FinTech needs: By analyzing your current technology stack and business goals, an expert can recommend the right tools and platforms to keep you agile and competitive.

• Guide implementation: They can oversee the implementation process to ensure a smooth transition with minimal disruptions. This includes ensuring teams are up to speed on the new technology and fully leveraging its capabilities.

• Forecast future needs: A FinTech expert can help you forecast technology needs based on industry trends and your company’s growth trajectory. This is crucial to making a technology investment that will provide long-term dividends.

Automation and technology can help CFOs make faster, more strategic decisions. Automation can provide operational data, which can help CFOs focus on high-level strategic decision-making, such as driving growth and maximizing value for the organization. Automation can also streamline financial processes and provide real-time insights.

Ways Automation Can Help CFOs

• Financial reporting automation: Eliminates manual data entry, reduces the risk of errors, and enhances the accuracy and efficiency of reporting activities.

• Financial planning and analysis (FP&A) software: Enables CFOs to generate accurate financial forecasts, analyze cash flows, and make strategic decisions based on real-time data.

According to a Deloitte report, 76% of CFOs expect digital transformation and technologies to play a greater role in 2024, with 80% expecting their organizations to embed more automation and digital technologies into their operations in the coming year.

To ensure the accuracy of the data used for decision-making, CFOs can implement robust data validation and quality control processes. This involves regularly auditing and verifying data sources, maintaining data integrity, and implementing data governance practices.

Technologies That Can Help CFOs

• AI: Can help CFOs focus on high-level strategic decision-making, such as driving growth and maximizing value for the organization.

• Machine learning: Can streamline financial processes and empower CFOs with real-time insights and data-driven decision-making capabilities.

• Cloud-based solutions: Can streamline financial processes and empower CFOs with real-time insights and data-driven decision-making capabilities.

Automation is revolutionizing the roles of modern CFOs, allowing them to focus on strategic operations and making swift, data-informed decisions. Despite automation being uncommon in financial departments, reports show that 80% of financial operations have potential for automation. Now is the prime time for organizations to embrace this transformation.

3 Ways Automation Empowers the Modern CFO

1. Assuming Mundane Tasks: Automation takes over manual tasks, freeing up invaluable time to focus on critical strategic operations. Not to mention that tools like these speed up work significantly.

2. Collecting Key Data: Automation tools offer crucial operational data, enabling CFOs to make informed and swift business decisions. Implementing robust data validation and quality control processes ensures the accuracy of this information.

3. Facilitating Insight-Driven Team Leadership: The data gathered empowers CFOs with deep insights about the operations of their teams, thereby enabling sound strategic decisions.

Embracing automation helps modern CFOs adapt to extraordinary challenges, evolve as strategic, data-driven leaders, and become the driving force behind organizational success. To provide this holistic perspective, CFOs must be a part of the entire process and have hands in all aspects of company operations to understand the big picture.

The Value of a Fractional CFO

CFOs are facing increased scrutiny, growing operational complexity, tighter deadlines, and more, forcing them to evolve into a more active and strategic role. It’s no longer enough to provide ad hoc analysis or siloed data to the C-suite. Now, companies are looking to CFOs and their teams to contextualize the data, provide deeper and more actionable insights, and guide the organization’s next steps.

We’re seeing more organizations, enlisting a tech-savvy fractional CFO offers the most direct and comprehensive approach to revamping and aligning their technology programs. These experienced financial leaders track emerging technologies in finance and accounting and come prepared to match you with the newest and best options, establishing a firm grasp of the entire company’s operations.

They work alongside finance teams and C-suite executives to plan technological upgrades and carefully map out future technology investments. By leveraging their expertise, companies can ensure they remain technologically competitive while addressing their current needs and future challenges.

Your Financial Technology Partners

By embracing a strategic approach to technology investment, focusing on enhancing team capabilities, ensuring compliance and security, and leveraging external expertise, CFOs can ensure their companies not only survive but thrive in the digital era. But they don’t need to do it alone.

Let the experts at Growth Operators take the guesswork out of modern accounting and financial technology tools. We’ll equip and train your finance team on the latest software applications while setting the stage for future innovation. All it takes is a call to get started on the path towards more advanced and effective technological capabilities.