IT enables CFOs to move beyond finance
In the current business scenario, the CXOs’ role has extended well beyond their specific functions. At a recent CFO summit organised by the Indian Chamber of Commerce (ICC) in Kolkata, CFOs and business leaders discussed how changing technologies have enhanced the role of CFOs and created wider challenges and opportunities for them.
“With the emergence of newer technology, legislations and regulations, CFOs are compelled to extend their skills based on the changing business requirement and IT is certainly a key enabler in the process,” said Soumen Mukherjee, Associate Director, PricewaterhouseCoopers Private Limited.
He believes that traditionally, the finance head was assigned to look after accounts and finance as managing financial operations was the means to achieve business goals. However, with changing technological capabilities and market conditions, the new-generation CXOs are expected to adapt themselves to the ever challenging business landscape and the CFO’s role is also increasing evolving.
Age of tech-savvy CFOs
Today, much of financial leadership revolves around the decision-making around enterprise IT. In order to bring efficiency in business functioning, CFOs believe that effective use of technology is the need of the hour. With the emergence of the Web and more sophisticated technology, access to financial information is readily available to them.
“The role of IT has transformed as it becomes more business facing, responding to the needs and objectives of the enterprise on the whole. It contributes more directly to the bottom line. As a result, the potential role of the CFO in IT decision-making has also increased,” said Karni Arha, CFO, IndiaFirst Life Insurance.
He believes that today, the financial officer is still responsible for measuring the financial achievements of the enterprise, but they are also getting more involved in the strategic formulation process, setting specific business objectives and in the process leveraging IT to achieve this goal in the possible areas it can be empowered.
“Cloud computing has changed the enterprise decision making process to a large extent and CFOs are adapting to this change. This is because it often involves using third-party service providers rather than owning the hardware and software assets. In fact, the pay as you go model has brought about a sea change in the financing systems of organisations,” noted Anibandha Mukhopadhyay, Advisor technoforte Software Private Limited.
Mukhopadhyay believes that in order to get the value from the data today, CFOs are also leveraging other emerging technologies such as business intelligence, social media, analytics and mobility. Big data is also another area CFOs are keen on and in all these, they are looking for the right orchestration strategy and processes in place to drive business values.
This means that just as the new age CIO is expected to be business savvy and work towards aligning IT with business objectives, companies also need a tech savvy CFO who has an understanding of the key IT metrics alongside managing expenses and also move their organizations forward.
Success in collaboration
“CFOs are responsible to bring about an increase in ROI in all assets of the enterprise, including, people, accounts, customers, data and brand, to name a few and act as risk mitigators beyond the financial risk. In other words, they are also expected to drive innovation by using information from the available data, and all these can often be challenging,” said P K Mallick, CFO, Universal Success Enterprise.
He believes, this demands a renewed bonding between the CFO and CIO as well as other board members, who are expected to discuss processes, analytics and other technical capabilities in the enterprise.
According to Arha, even the IT budget should be a decision taken by the executive team keeping in mind where the organisation stands currently and what it wants to achieve in the future. This will ensure that IT is meeting the business objectives in a better and simplistic way.
The CFO’s role should be reflective of changes that would have an impact on the entire enterprise. As organisations use a collaborative approach, encouraging newer technologies such as mobility and social media among others, the CFO will continue to play an even more pivotal role in creating an enterprise that can thrive on any business environment.
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