<b>Nicolas Dumoulin</b>: From bookkeeping to visualising data

The big data world is encouraging CFOs to take a holistic view of their duties

For a long time, the CFO’s primary focus has been to keep the financials in good order and manage regulatory challenges faced by their organisation. But this is changing. The integration of digital and big data analysis in business models is nudging CFOs out of their traditional functions and requiring them to take a more holistic 360-degree view of their duties. This includes more cross-functional collaboration and, most importantly, a keen understanding of big data as the driver of strategic decision-making. Having said that, even finance as a function has seen tectonic shifts over the last few years.

Big data analytics as a competitive edge: Data now drives decision-making. CFOs must constantly update their IT skill sets so they can invest, glean insights and utilise predictive analysis from big data to power financial decision-making. It is also important for the CFO to crowdsource this data from across functions, and not just rely on data from within finance. For example, understanding customer and product category data — traditionally handled by marketing teams — can be a large influence when allocating budgets.

Proactively communicate with investors: CFOs are increasingly seen as brand evangelists for a company. While they are often required to explain the financial health of the firm, they have to create an ongoing conversation with investors so that business-critical decisions can be validated in the right context of the firm’s strategic plans. Sudden announcements can leave investors with unanswered questions and markets typically do not react favourably to surprises. So, CFOs have to acquire storytelling skills in their constant company-wide communication.

Build media relations: Business media is an important platform where companies engage journalists to build brand. CFOs are increasingly required to anchor the relationship of the company with the media. This way, company reputation is kept at the optimum and always held in high regard by customers, investors, shareholders as well as the public.

Bolster interdepartmental relationships: While CEOs have much wider accountability, CFOs are seen as “custodians” of the organisation. The CFO can provide much-needed support to other department leaders, as nobody is better placed to understand the financial impact of any project. Therefore, CFOs need to bring together different heads and teams to create a collaborative environment, achieve goals and create a sustainable long-term vision.

Technological know-how: We have stepped up in 2017 with companies in India having progressive technology installed. Harnessing maximum efficiency through this and instilling knowledge of the new installations would be an extended role of CFO. The management looks up to CEO for leadership in embracing technological upgrade, but they require direction from the CFO to absorb the technical know-how.

Assisting in business development: There is much wider accountability at the level of CEO, hence the CFO is required to provide guidance on strategy. A business development head can work in tandem with the CFO and this can prove to be a winning tag team.

Thus, the CFO invariably becomes the go-to in solutions for the CEO, having detailed knowledge of the company’s financial information. Their analytical skill sets and knowledge of where profit is generated from, facilitates the CEO in decision-making and performing other management activities.