Inevitable retraining of finance professionals is on the horizon


For finance professionals to take center stage in front of the CEO and perform as advisers rather than number crunchers – they need to get out of their comfort zone.

Over the past 30 years, the role of the CFO has gradually moved towards becoming a key on executive boards. Additionally, automation and digitalization are equipping you (and your fellow finance professionals) with new tools. When the processing of numbers and delivery of reports become fully automated, you no longer need to spend up to 90% of your time ensuring that the numbers are correct. And this combination can strengthen the perception of the finance team’s value on strategic decisions.

A whole new role surfaces, one for which many finance professionals need to prepare. It also means that the CEO and the other members of the management team can and should expect other qualities from the average CFO. The CFO and Controller need to be advisers rather than merely deliverers of figures, and as finance professionals ourselves, we would like to encourage this trend.

The new weekly schedule

According to the traditional weekly schedule, you work on the financial report on Monday, Tuesday, and Wednesday. On Thursday, you do the final touches on the report and send it out in the afternoon by email.

Phew.

On Friday, you check whether anyone has done or noticed anything.

No…?

OK.

Begin the process again on Monday.

In the future, the week will look like this – (and it already does in some finance departments):

  • Monday: The report will be ready at 8 am because everything is fully automated. You skim it and go to meetings with your stakeholders, ask questions, and agree on the state of the business.
  • Tuesday: You brainstorm about how to improve the business based on your data insights.
  • Wednesday: You identify the best ideas and decide what to do.
  • Thursday: You implement the initiatives that boost the business.
  • Friday: You calculate how much money the new initiatives have earned for the business this week.

Into the spotlight

We tend to let those responsible for the business area decide what to do, based on our spreadsheet numbers. However, these people need help understanding the meaning behind every number.  So how do we, as finance professionals, take center stage and become involved in presenting the report? One clear answer is: It starts with digitalization. 

Digitalization of the finance function enables speedy delivery of the figures to the entire group; in minutes and hours compared to days and weeks. In addition to the figures presenting a real-time picture, time is freed up for analysis and advising the rest of management.

If we present a report with three-week-old figures, five minutes later, the people responsible for the business will be sitting and discussing what they should do – without us.

If financial work is to make sense, we must deliver actual figures and evaluate the business’s performance.

We need to challenge the mindset: ‘You don’t earn anything on these particular customers, so why are you holding onto them?’ Then, it is up to the people responsible for the business to decide whether to act or whether other factors make these customers worth keeping.

We must ask all departments to tell us more about the business and their strategy. This will allow us to get back to them the following month with recommendations.

Why is it not simply the job of the people responsible for the business to read the figures themselves and do something?

Because their job is not to understand the figures but to generate business with customers, they do not have time to delve into the numbers, but we do. We need to point out when something looks wrong, and there is potential for improvement. Then, the business people can do their job.

This will turn the finance department into a value-adding profit center, transforming it from a mere cost center with a mission to improve efficiency. 

Why retraining is necessary

Progress requires effort. Many controllers feel more comfortable fine-tuning and removing errors from Excel spreadsheets than standing in front of senior management to present a report. The way forward is to start with baby steps. But if a tiny step means more tinkering with Excel, there will not be much progress.

The finance function must be more aware of its strengths. While we have been slaves to systems and processes, we have neglected the management role. Now we need to assume it.

We need to be leaders rather than spreadsheet wizards.

The finance department is the only department in the organization that truly understands numbers. Therefore, it makes no sense that the company stops using this insight once the report has been delivered. We need to assume the business’s adviser role and continuously apply our unique understanding.

There is no longer any excuse for not moving forward because we have access to all kinds of systems for automation. This means that many finance professionals will have to think innovatively. There is still a need for eyes and hands to balance the figures, but many skillful CFOs and controllers need to be retrained to think more in terms of the future – to step out onto the stage and advise. 

Authors:
Claus Finderup Grove, CEO at Konsolidator 
Anders Liu-Lindberg, Co-founder of the Business Partnering Institute.



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