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What the Research Reveals: CFO Top Challenges in 2018

As 2018 comes to an end, the latest reports and surveys provide a general market summary, reveal the current CFO agenda, define recent challenges, and indicate what the future will bring.

As the final month of 2018 approaches, the issuances of the latest surveys and reports provide a market summary and reveal the current CFO agenda to indicate what the future will bring. A chief financial officer must be honest and resourceful while effectively managing capital and human resources. Technology is becoming an integral tool with innovations such as AP automation that enable CFOs to measure financial data in real time. Consider some of the recent findings of what CFOs deliver today and are expected to do tomorrow.

CFO Pulse Survey 2018 - 3 Key Trends for the CFO Role

Korn Ferry’s Financial Officers Practice surveyed over 700 CFOs around the world to understand their perspective on the role and trends impacting corporate finance today. According to the CFO Pulse Survey 2018, their role was separated into three distinct sections - focus on succession planning, the transformation of finance, and the rise of business intelligence and analytics.

  • Only 34 percent of CFOs stated there is a succession plan in place for their role, and 81 percent said there is no internal successor who is ready to take over now, though 51 percent of CFO appointments are filled internally. Technology tools, such as AP automation, enable better control by providing timely analytics and finance reporting, helping AP deliver increased value to the financial statements and the business as a whole. This means some of the future finance leaders could have an AP background.
  • Over the past year, CFOs have shifted how they structure the finance/accounting function with 55 percent of them reporting they combined roles in the function for reasons related to talent, and revealing areas in finance that require talent transformation - 22 percent reported the transformation was needed most in Operational Finance, followed by FP&A (19 percent), Strategic Planning/M&A (16 percent), and Financial Reporting (10 percent).
  • The overwhelming majority of CFOs, totaling 84 percent, are leveraging BI data through the smart use of technology tools such as AP automation. The most common use of BI is to optimize operations to boost the bottom line (64 percent), followed by evaluate risk (36 percent), then analyze customer behavior to drive decisions (26 percent).

The three factors that keep CFOs awake at night include recruiting and maintaining top talent, lack of organizational alignment, and the threat of a cybersecurity breach. The use of digital business applications such as AP automation helps attract young talent, as tech-savvy millennials want to join a modern, efficient workspace. Secure cloud automation ensures everyone in the organization gets updated financial data in real-time so that they can work together seamlessly from any location at any time.

Finance Redefined Survey - How Current Market Changes Impact the CFO Agenda

The Finance Redefined Survey, gauging the reports of over 670 CFOs and financial leaders around the globe, revealed some of the latest market changes and how they impact the CFO agenda including:

Of those surveyed this year, 51 percent rated C-suite collaboration as very important, making it the most relevant issue in the 2018 survey. Respondents at organizations with the highest level of collaboration were likely to anticipate growth of at least 10 percent, yet 73 percent of respondents revealed their C-suite leaders rarely worked together on projects or strategic initiatives. As an example, the implementation of AP automation makes it easier for the AP and procurement departments to collaborate and puts pertinent data at the fingertips of the C-suite as it happens.

Beneficial collaborations forming as a result of improved access to big data include the CFO and CMO as well as the CFO and the CHRO, and EY reports in The Master CFO Collection Volume 6 that 80 percent of those surveyed said the relationship between the CFO and CHRO has become more collaborative as they grapple with complex human capital decisions together.

CFOs must now also act as chief collaborating officers to develop effective relationships that promote corporate and personal growth with a focus on three major areas: building understanding of C-suite peers’ pressures, goals, and priorities; understanding each other’s language and communication styles; and exploring cross-functional career paths for the financial leaders of the future.

The CFO Agenda Today

As the role of the CFO expands and becomes more important, they continue to face the same issues that form their agenda including truth, growth, relationships, decisions, capital, disruptions, crisis, infrastructure, transactions, transitions, and becoming the financial face of the organization while still keeping track of personal goals. Automation is playing a crucial role by keeping everyone in the organizations updated in real time to promote a collaborative environment, regardless of location or the time of day, where relationships are built, errors are found and addressed, and data is used to improve the bottom line.

Additionally, a CFO must hone his or her skills and approach per current market demands. Considerations include changing market dynamics, attributes that matter, what boards want, elevating their game, and succession planning. The leading attributes a CFO should have include an international perspective, a strong understanding of operations, organizational leadership skills, and the ability to drive value through the effective use of data and analytics. A CFO who recognizes the need for AP automation and facilitates its implementation will prove he or she possesses these critical attributes.

As the role of the CFO continues to evolve, AP automation supports the CFO’s challenges of today and the future. Automation promotes the collaboration required to attract and develop the leaders of tomorrow. CFOs attract millennial talent and provide a collaborative environment where people can work together regardless of location and timing. As more people choose to work remotely, AP automation makes crucial data accessible in real-time. Through the continued use of automated solutions, team members will discover how easy it is to work together, even when they are in different departments and places. Access to data provides the transparency needed to correct mistakes, minimize losses, and maximize resources - including human resources such as AP members who become strategic partners with the C-suite. As a result, it is easier to develop a succession plan that ensures the organization continues to grow and remain relevant in a rapidly changing business world.

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