By Keshav R. Murugesh, Group CEO, WNS and Chairman, Nasscom BPM Council, India
The legacy of the CFO role is a concentration on financial control blended with a significant proportion of time spent analysing historic numbers as well as controlling cost and risk. Today, however, that role is almost unrecognisable. Today‘s CFO adopts much more of a leadership role. They are responsible for managing multiple business functions, such as operations, IT and legal, as well as controlling the finance function.
But it’s not just the role of the CFO that’s evolving, so too is the business environment in which the CFO operates. Traditional finance is now an intricate part of a wider business perspective that includes customer behaviour, demographic analysis and consumer trends. Gone are the days where the key to success lies in having an analytical mind, today a broader business mindset is needed.
As the role of the CFO evolves, so too do the challenges and hurdles that must be overcome. In fact these challenges include everything from finding ways to manage operations more effectively, minimising compliance concern or innovating and creating value beyond simple cost savings. The good news, however, is that these challenges often become a cause for innovation, as savvy CFOs look for new ways to overcome them. Our conversations with CFOs have allowed us to better understand some of the key challenges they face today, including:
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- Maximising Technology Investments: The reality today is that companies of all sizes often struggle to make the right investments in IT, often spending too much on IT services that keep the lights on and not enough on new projects that can improve or add to those systems. This is a common debate that CFOs are all too familiar with. After all, it’s only wise to spend on new IT services if there is a clear return on investment to be had. With this in mind, ensuring that existing IT capabilities are being used to their full potential is key. As is choosing the right time to make the correct technological investment in an environment that refuses to stand still.
- Controlling the Cost of Compliance: Operations in compliance and regulatory reporting – in an already challenging environment requires continual evolution of efficiencies, rising expectation of stockholders, regulators and communities. These things combined have moved the bar quite high for CFOs today. As the number of regulations rise, so too does the complexity of the business environment in which we operate, something that inevitably requires a greater need for increased control in the compliance department.
- Perfecting the Target Operating Model: Figures show that the average knowledge worker wastes an average of 41% on activities that could be handled competently by others. CFOs are only too aware of this and are becoming increasingly open to ways that can boost productivity and trim fat by providing knowledge workers with the opportunity to focus their attention on core areas, to ensure that the right skillset is completing the right job.
- Using Data to Make More Informed Business Decisions: There is an old management adage that states “you can’t manage what you don’t measure”. Simply put, getting to grips with company data has given CFOs an unprecedented level of insight into current business processes, enabling them to learn more about how well things work than ever before. If used correctly, this data can be directly translated into knowledge to help informed decision making and enhance performance.
Operating in a world of change is no mean feat, something that largely explains why, when confronted with a string of challenges, the ‘once cautious’ CFOs are becoming increasingly enthusiastic about the benefits that strategic partnerships can offer. The CFO plays a critical role in ensuring that the organisation, no matter its size or circumstance is able to keep up with the phenomenal pace of business. And this is precisely why we continue to work closely with them, to ensure they are best placed to change their operating models to ensure business success.