Previously, the CFO was tasked with keeping the accounting department on track and the company finances on firm footing. Those are still imperatives, but CFOs now serve as strategic actors like never before.
As companies search everywhere for competitive advantages, careful and clever financial engineering has become more integral to success. It often falls to the CFO to prepare the forecasts, reports and recommendations that guide the company's future.
No matter how you feel about the evolution of the CFO, it's essential to understand how the C-Suite is changing and what will be expected of the executives of the future. Sustained success depends on staying ahead of the curve.
The New Importance of Data
Facts and figures have always been important to CFOs. What is now different is that decision making is based on much broader and deeper categories of financial information, along with operational data from multiple departments. Basic bookkeeping has transformed into large-scale data management.
Whether or not CFOs take a data-driven approach is not up for debate. It is easier than ever to collect, store, analyze and utilize quality data. More importantly, success will increasingly be defined by a CFOs ability to extract unique insights and adopt innovative approaches. Executives who do not embrace data will fall behind to those who do.
Knowing that data is the lifeblood of the modern accounting department, decision makers must focus as much on managing and optimizing data as they do on utilizing and analyzing it. It falls to CFOs to ensure that companies are as informed and aware as possible when making decisions that directly affect the bottom line. That requires new attitudes and approaches, but it also requires new tools.
Gaining Perspective with a Financial Management Solution
If you need evidence that the CFO role is evolving, just look at the rapid decline of Excel. This was once the most ubiquitous accounting tool on the planet. Now everyone except the smallest businesses acknowledges that it is underpowered and ineffective.
CFOs and the accounting departments they lead are implementing enterprise-wide financial management solutions instead. These provide the scale and sophistication that strategic accounting requires. They also give form and function to vast and unruly sets of data. It's possible to find the signal through the noise no matter how loud the volume is.
A financial management solution serves the strategic aims of today's CFOs. Said differently, it makes the evolution of the CFO an accessible asset rather than an insurmountable obstacle.
This content was originally posted here.