smarterCFO #1
Welcome to the first edition of smarterCFO, our new quarterly magazine for finance leaders in EMEA.
smarter*CFO*
EMEA Edition | Vol. 1
Editor’s comment
Welcome to the first edition of smarterCFO, our new quarterly magazine for finance leaders in EMEA.
CFOs have always had a big job, one where expectations are high and risks even higher. Over the past few years, expectations have increased beyond just maximising shareholder value, to meeting the expectations of a broader set of stakeholders and becoming the architects of value creation. With so much changing on the CFO’s horizon, we hope smarterCFO will provide valuable insight, helping finance leaders to navigate change and uncertainty, transforming their roles along the way.
Each quarter, we’ll share the latest insights for finance leaders, creating a space where they can share knowledge and learn from each other.
In this edition we’ll be tackling the questions we know loom large for finance leaders: can technology help you overcome volatility, uncertainty, complexity and ambiguity?; how did the pandemic help leaders reimagine the finance function?; and can the CFO become the driver of digital transformation, while also taking on the role of value creator for their organisations?
We’re focused on providing you with the very best peer insight. We know how valuable it is to learn from CFOs and finance leaders as they tackle the issues facing business today and undergo transformations of their own. In this issue we hear from Nigel Bryan, Head of Financial Control at NFU Mutual, and recent winner of Insurance Brand of the Year at the Which? Awards 2022.
We also have insights from finance leaders at Germany-based neobank N26, Ireland-based software company Kainos, and ÏDKIDS, a French-based community for children and parents.
We’re also delighted to feature insight from award-winning journalist Oliver Pickup, as well as thought leadership from Workday partners Accenture and Deloitte.
Our hope is that this and subsequent editions of smarterCFO provide you with the insights, opinions and conversations you need to help navigate the shifting world around you and become a changemaker in your organisation.
Grant Currie
Editor-in-Chief
Welcome to the conversation!
If you’ve got ideas of your own, or you’re interested in sharing your expertise and insight, we’d love to hear from you.
Get in Touch
Contents
Give your finance teams the digital tools that could save your business
Award-winning journalist Oliver Pickup on the digital tools finance teams need in this time of uncertainty
Read Now
Inside view: A finance leader’s perspective on digital transformation
Nigel Bryan, Head of Financial Control at NFU Mutual, gives his take on transformation and the importance of partnering with IT
Read Now
Masters of change:
The CFO transformed
Tim Wakeford, Vice President of Product Strategy at Workday, on how CFOs can transform from business partner to value partner
Read Now
High tech CFOs:
Evolving into the future
Anne Peabody, Eric Noren and Michael Di Stefano from Accenture highlight the opportunities for high tech CFOs
Read Now
How European finance leaders are preparing for a post-pandemic world
Steve Dunne, EMEA Staff Writer at Workday, shares insights from his conversations with finance leaders from Atlas Professionals, ÏDKIDS, Kainos, KPMG, N26 and Veolia
Read Now
Finance as a driver of transformation:
What CFOs need to enable organisational change
Bruno J Navarro, Staff Writer at Workday, on how CFOs can be a driving force for change
Read Now
*Give your finance
teams the digital
tools that could
save your business*
Award-winning journalist Oliver Pickup
on the digital tools finance teams
need in this time of uncertainty
By Oliver Pickup,
Award-winning Writer, Pickup Media
What percentage of your time is spent on lower-value background data preparation?
- 0%–25%
- 26%–50%
- 51%–75%
- 76%–100%
With real-time data at their fingertips, greater connectivity to other functions and by dialling up automation, financial professionals can drive strategy and improve organisational agility in this increasingly tumultuous period.
In 2022, businesses operate in a ‘VUCA’ world – an acronym for volatility, uncertainty, complexity and ambiguity, coined in 1987. Organisations that give their finance teams digital tools and invest in cloud computing and automation, among other technology solutions, will come out on top, whatever the business landscape. However, with a global recession looming, organisations must double down on technology solutions today and empower their financial teams to survive and even thrive tomorrow.
This approach is markedly different from the one many businesses used after the 2008 economic downturn, when cutting back was the common strategy. Thanks to the gallop of digital technologies in recent years, investment in pioneering innovations is critical to triumph in times of crisis.
Although there is a widespread understanding that digitalisation must be at the heart of financial processes, allowing businesses to respond with greater agility and better support business objectives, there is still a worrying sluggishness in many areas. Hence, tech-savvy finance functions, equipped with digital tools, will seize a significant advantage over rivals, while slow adopters will fall.
Peter Boerhof, VAT Director at Vertex, a provider of tax technology solutions, offers one example. “Despite six out of 10 financial decision-makers stating that new technologies will provide opportunities for business scalability, our research indicates that manual processes are still being used for indirect tax management,” he says. “This is becoming increasingly unsustainable at the rate sales continue to grow.”
In this instance, Boerhof argues: "Best-in-class technology can handle the changing requirements of the tax landscape, apply correct tax determination and calculation rules to online shopping baskets in real-time and help ensure data is error-free and audit ready.”
He adds: “This frees tax teams up to provide valuable strategic insights to move the business forward, but also means new territories can be entered confidently.”
Unparalleled insights to deliver business goals
The Dutchman makes an important point: more than before the coronavirus crisis, a finance function equipped with data and digital tools can – and should – shape business strategy. Traditionally, these teams have been a siloed part of businesses, buried away from other departments with their members completing process-led tasks with their heads buried in spreadsheets.
The stereotype of financial professionals as ‘number crunchers’ is outdated in the digital era. Developments in technology have led to the finance function increasingly becoming a centralised business function, partnering with other parts to deliver departmental and broader business goals. Now, in a VUCA world, the finance team is at the cutting edge.
With real-time data at their fingertips, combined with advances in automation plus connectivity to other business applications – including human capital management, customer relationship management, supply chain and payments systems – finance professionals can provide unparalleled insights.
Further, they can establish agile financial technology such as continuous planning, which provides a clearer picture of the numbers and the reasons for the change in figures, be it supply-chain issues, declining demands, or a myriad of other factors. The days of an annual or bi-annual financial review should be over, given six-month predictions run the risk of being risibly out of date within weeks, if not days.
The tech-enhanced role of the modern Chief Financial Officer has never been more closely tied to the success – or failure – of a business. With a global economic crash on the horizon, those who have not already invested in tech solutions and improved efficiencies in the financial function will likely struggle.
Given the recent increase in volatility and uncertainty in the world around us, continuous planning is an essential business practice – the annual fixed budget is no longer fit for purpose.
Spurring financial transformation
“Business leaders need to invest in a technology strategy that expedites business value from data while future-proofing their tech stack by easily integrating new and existing finance tools and reducing operating expenses,” says Nick Jewell, Technology Evangelist at Incorta, an analytics platform for acquiring, processing, analysing and presenting business applications data. There’s much work to do for many businesses, though.
“Sadly, finance teams are often mired in silos of dirty data that require considerable manual effort in order to be fit for purpose when it comes to analytics,” he continues. Indeed, the Workday CFO Indicator Survey 2021 found that only 5% of a finance team’s time is spent generating actionable insights for the business, compared with nearly 75% spent on lower-value background data preparation activities such as summarising or filtering datasets.
Now, Jewell suggests, with many businesses facing economic hardship, the CFO is pivotal to an organisation’s prospects. Owing to rising inflation, budgets will be squeezed, meaning month-end reporting will be under greater scrutiny.
But could that added pressure on business operations be the spur organisations require to improve financial processes, revamp old ways of working and fund what Mark Bodger, Director at financial and operational planning consultancy ICit Business Intelligence, calls 'financial transformation'?
“Given the recent increase in volatility and uncertainty in the world around us, continuous planning is an essential business practice – the annual fixed budget is no longer fit for purpose,” he says. “The ability to plan resources in response to business challenges and opportunities requires rolling forecasts and scenario-planning capabilities.”
The increased burden on CFOs, in particular, necessitates the evolution of processes as well as individuals and their teams. To maximise this opportunity, finance leaders and their staff must have the requisite data science skills. Again, this requirement is a definite upgrading of what most people consider the typical accounting background.
Concurrently, quality data from across a business must be shared to inform financial teams better and build long-and-shorter-term strategies. The value exchange for this greater visibility of data is that a CFO is expected to communicate insights to the rest of the C-suite – no easy task without adequate expertise, but a win-win for business.
CFOs leading the charge in the digital age
“The increased demand on CFOs from Chief Executives and other board members has put finance and the service they provide in the spotlight,” Bodger says. “A major shift has been the need to react in the moment and provide clear leadership and decision support to mitigate risks and take advantage of new opportunities.”
As organisations firm up their hybrid working strategies, the onus is on CFOs and their colleagues to test what’s working. “The challenges of remote working with legacy on-premise systems, poor connectivity and often firewalls preventing access, meant many finance functions could not operate efficiently,” continues Bodger. “The most pioneering finance teams understood this and moved their systems to the cloud.”
In addition to shifting to cloud computing, high-growth organisations have realised that they can no longer rely on legacy systems and manual processes to scale operations. But what are the best digital tools that empower finance teams in a VUCA world? “The core requirements are an enterprise resource planning and customer relationship management solution that integrate seamlessly,” says Bodger. “This means the transactions that flow in and out of the business are recorded accurately in the ledgers. These form the factual basis for planning and reporting future outcomes.”
Excitingly, we are just beginning this era and early movers will gain much ground. But, ultimately, staying still is not an option, as Darwin’s theory of evolution will be played out in digital form.
“Those that wish to stay ahead of the pack invest in the best people, processes and technology,” concludes Bodger. “CFOs are hugely influential in determining strategy and driving operational rigour to achieve companies’ objectives. While keeping score is necessary, having the best tools to help make the right decisions for the future will set them apart.”
Those that wish to stay ahead of the pack invest in the best people, processes and technology.
*Inside view: A finance leader’s perspective on digital transformation*
Nigel Bryan, Head of Financial Control at NFU Mutual, gives his take on transformation and the importance of partnering with IT
Nigel Bryan,
Head of Financial Control, NFU Mutual
The partnership between IT and the CFO function is critical to supporting real financial transformation. At Workday Elevate London, Nigel Bryan, Head of Financial Control at NFU Mutual, spoke with Carolyn Horne, Senior EMEA Vice President, Strategic Customer Engagements at Workday. He gave a finance leader’s perspective on digital transformation and offered advice to businesses on a similar path to change.
Could you introduce yourself and tell us a little bit about NFU Mutual and what the business does?
I'm Nigel Bryan, Head of Financial Control at NFU Mutual. A lot of people may know of NFU Mutual. We are the National Farmers Union Mutual, an insurance company that’s very much linked to the farming and the rural community and we’ve been in existence for over 100 years. I’m currently leading our transformation and modernisation programme within finance. That's where Workday comes in – because that's the system part of the programme. It’s very exciting for me – we go live with our first phase (procurement) at the end of June.
You mentioned NFU is over 100 years old, an organisation with a tremendous heritage. Yet transformation and digitisation are really big areas of focus for you. At what point did that light-bulb moment happen, where you realised you needed to transform your finance function?
I guess it was probably the change of finance leadership in many ways. I came into my role at the same time as my boss. As an organisation, we'd made a lot of investments into customer-facing IT systems. We came in and had a look and said, "well, it's time for finance now." We did a piece of work looking at our system landscape and strategically what the finance function needed to look like over the next five to 10 years. This highlighted a number of things, including system risks. As many people will recognise, we had a lot of manual processes with human dependencies, out-of-support systems, end-of-life systems, heavy dependency on EUCs and spreadsheets, very manual control environments – things that aren’t sustainable with the ever-increasing demands being made on the finance function.
All of which were barriers to that broader strategic vision of finance you were looking to build?
Yes. Ultimately it’s about delivering that strategic vision element in terms of ‘what does finance need to be delivering to the business?’ Tim Wakeford [in an earlier Workday Elevate London session] was talking about finance being business partners as well as value partners. We spend so much time doing the transactional and not enough time supporting the business. So, for us, it wasn’t so much a light-bulb moment, it was a ‘duh’ moment. We just needed to get it done. We then built a business case around many of those points, got the support and off we went.
This is a journey. It's a cliché but it's true. We're going to be in a continuous development cycle and that's the challenge for us. We are setting up a finance technology and change team because it needs to be something
that we need to embed as the ‘way we do things in finance’.
Nigel Bryan, Head of Financial Control, NFU MutualI know you led the procurement process during the pandemic, so can you tell us about the evaluation stage and some of the key differentiators that really stood out to you?
Yes, we did the RFP online during the pandemic – and I’m pretty sure my kids joined in the process, as many did! It was quite tough doing an RFP remotely like that. But we got through and we selected Workday. I guess two things I was going to mention about what differentiated Workday from other offerings. First of all, obviously, Workday is a true cloud-based offering. And when we looked at some of the other offerings, that really appealed to my IT colleagues from an architecture perspective, the excitement that this brings to the business with the future releases and the evolving picture going forward.
Secondly it was the integrated nature of the product that appealed. One of the challenges we had was that our procurement colleagues were very keen to look at best-of-breed procurement solutions.
There was a bit of tension there in terms of what they would aspire to have versus what we got from some of the ERP-type offerings. But we worked through that and I think it was a key part of the debate. I have to say, ultimately, the benefits you get from an integrated solution like Workday with all the components working together and the additional components you can include from both the data and an HR perspective, was what won the day for us, along with it being a true cloud offering. That was what swayed it and took us down the Workday route.
What’s really exciting for me is what this means going forward, not just from the operational efficiency perspective e.g. more streamlined processes and a single source of truth but also what we can then do with the more granular data. That will be transformational.
Nigel Bryan, Head of Financial Control, NFU MutualI know you’ve deployed Workday technologies to support analytics, planning and how you think about accounting. How do you envisage that those will help you collaborate across the business and make better decisions?
We've selected Workday Financial Management, Workday Prism Analytics and Workday Accounting Centre. We also selected Workday Adaptive Planning, although we'll fully implement that in a slightly later phase. But I think one of the things that we were keen to do was to make sure that the programme was really and truly transformational. And by taking Workday Prism Analytics and Workday Accounting Centre, that's forced us to really think about integration points. You all have your own integration points that you need to think about – but we were keen to make sure we didn't just lift and shift our current world and just plug it into a new general ledger system.
That would be great and that would de-risk us to a degree, but that's not transformation in my mind. We’ve gone back to our source systems, pulled new datasets through at a much more granular level and will be building a new data store for us in Workday Financial Management and in Workday Adaptive Planning too. We've uncovered some horrors on the way, as I'm sure a lot of organisations have, where you've got accounting logic and all sorts of things buried in IT code, in our case, from the 1970s and beyond. We’re looking to address all these.
What’s really exciting for me is what this means going forward, not just from the operational efficiency perspective e.g. more streamlined processes and a single source of truth, but also what we can then do with the more granular data. That will be transformational as well.
Workday is a true cloud-based offering. And when we looked at some of the other offerings, that really appealed to my IT colleagues from an architecture perspective, the excitement that this brings to the business with the future releases and the evolving picture going forward.
Nigel Bryan, Head of Financial Control, NFU MutualFinally, we don’t know what the future holds but when you think about innovation and moving forward, what comes to mind and how do you see technology supporting you through that?
For us in finance at NFU Mutual, implementing the components of Workday that we’ve spoken about are big game-changers. It would be taking those and exploiting them, if that's the right term, to the maximum. And I think that’s both exciting and scary at the same time. So obviously, going live shortly on Workday, we'll be taking our first step on the ladder, as it were. It’s a big step and it's only the first one, as future releases come along with more functionality.
This is a journey. It's a cliché but it's true. We're going to be in a continuous development cycle and that's the challenge for us. We are setting up a finance technology and change team because it needs to be something that we need to embed as the ‘way we do things in finance’. This is a change from how we thought and behaved before. We now need to focus on delivering continuous improvement and change within the function. That will be our priority focus and keep us busy for a while.
Find out how First Central streamlined its finance and HR systems to manage rapid growth
Read Customer Story
*Masters of change:
The CFO transformed*
Tim Wakeford, Vice President of Product Strategy at Workday, on how CFOs can transform from business partner to value partner
Tim Wakeford,
Vice President of Product Strategy, Workday
The role of the CFO is changing. At Workday Elevate, London, Tim Wakeford, Vice President of Product Strategy, Workday, gave his perspective on transforming the finance function and offered advice on shifting from the traditional role of business partner to the value partner the C-suite needs.
How has the role of the CFO changed and what does that mean for finance leaders looking to create long term value for their organisations?
CEOs, boards and businesses are demanding more from their finance departments. Deloitte's Finance 2025 Revisited study, found that there’s great promise for finance organisations to create more value for their companies. The role of finance is going beyond the numbers and embracing the shift from business partner to value partner.
From a tech perspective, in the past, ERP systems were built to track value and not to handle the value drivers that we see today. Ninety percent of the value that's being created now comes from intangible assets – an organisation's people, brand names, customer relationships and social and intellectual capital. According to Ocean Tomo, in their market value study, intangible asset value has dramatically risen from 17% in 1975, to 90% in 2020. The pandemic further accelerated the rise and the trend towards the growth of intangible assets as a percentage of total assets is now more than 90% of the S&P 500 Index.
What’s holding finance leaders back and what should they be prioritising to help them become value creators for their organisations?
Experienced financial professionals already know that change is needed. They also know that the shift from traditional finance steward to value creator can be hard to achieve – providing strategic insights for value creation with fragmented, poorly integrated data can be almost impossible. CFOs aren’t able to support changes in their businesses or industry because their systems are rigid and their processes are calcified. They also need to be confident they have the right team in place with the necessary skills to take the business forward.
We’re now living in a world where finance can track value and have the insights to predict where you're going and to enable you to respond to changes proactively. With the right tool, finance has the adaptability to pivot quickly so you can capitalise on emerging opportunities in your markets. Finance employs the talent needed to execute its mandate to support strategic business objectives and drive value creation.
The good news is there’s a real appetite for change. Research shows that digitising and transforming ERP is now a high priority for CFOs and CIOs. According to Gartner, 82% of CFOs report their investments in digital are accelerating. And in 2021, CIOs said ERP was one of the top three software spending priorities, coming second only to analytics.
What role does data play in helping finance leaders become value creators for their organisations?
It goes without saying that you need access to your data, so you can make the best decisions for your organisation and impact business outcomes.
Your data can tell you basic things, like which products and services are the most profitable or your areas of discretionary spend outside of budget. Having the ability to drive commercial banking data really starts with high quality and clean data,and that's something that most organisations really struggle with. They can find coping with the sheer volume of data that's generated and the need to reconcile data across different systems challenging. Businesses that are overwhelmed by their data can find large parts of their team’s resources consumed by low-value activity. But data is fundamental to tell a cohesive business story.
It's estimated that by 2025 there will be over 180 zettabytes of data being generated. Can you imagine a data volume that vast? And it’s predicted that less than 5% of that data will ever be analysed. Imagine how valuable it would be if you could bring in high volumes of data from external systems. You could reconcile, clean transform and enhance that data. You could even generate accounting of that third-party data and analyse it at scale. If you could do all that, and you could do it in one place that's connected to your core financial system, that would be powerful. It would enable you, as finance leaders in your organisations, to make faster and more accurate decisions to drive business outcomes.
With the right tool, finance has the adaptability to pivot quickly so you can capitalise on emerging opportunities in your markets.
Tim Wakeford, Vice President of Product Strategy, Workday
How important is agility and how can the CFO make the finance function more flexible and adaptable?
Agility is fundamental to how effectively finance can support operations and drive value. Flexible and secure processes that are underpinned by an architecture purpose-built for change are key.
You shouldn't need to purchase a new solution or start an IT project to undertake basic tasks, like adding new reported dimensions, adding new complexities, or changing the organisational hierarchies to the standard business processes. You should be able to easily accommodate corporate strategy and business transformation activities. But at the minute that's hard for many companies to achieve.
Most organisations are bound by legacy systems and outdated processes. All of those things prevent them from quickly capitalising on new opportunities. Investors want companies that can pivot when times are tough and can do that without compromising their ability to seize opportunities when they come up.
One thing that enables you to futureproof your business is a system that's adapting to those business changes, that supports configurable dimensions of business processes, that enables you to do things like meet new regulatory requirements or track long-term sustainability predictors across your suppliers or your employees.
How does the CFO ensure they can attract and retain the right talent to create a high-performing team?
In today's fast-paced, volatile environment you've got to do a few fundamental things as a leader. You need to attract top talent to build your next-generation finance team, develop, retain and empower your talent and then get out of the way and let them deliver value for your organisation.
You need to attract top talent to build your next-generation finance team, develop, retain and empower your talent and then get out of the way and let them deliver value for your organisation.
Tim Wakeford, Vice President of Product Strategy, WorkdayStudents graduating from college this year were six years old when the smartphone was introduced. That means they likely don't remember a time when they couldn't Google or make purchases from the palm of their hand. Your finance system has to echo their experience and be the backbone of the modern experience, using natural language to surface information and workspaces that enable employees to perform their functions wherever they choose, in whichever applications that they want to be able to work in. Does your finance system incorporate machine learning to identify employees? Does it make recommendations that would suggest steps in your business process to improve the efficiency of your organisations?
Finance leaders should be trying to unlock the potential of its employees. How can you, as a leader, create specially curated experiences that have been designed specifically for your people, where anomalies are surfaced so they don't have to go digging for them? When it happens automatically, your people are left with more time to spend on strategic work that adds value. Employees should be empowered to access the information they need, when they need it and be given the tools to efficiently do their jobs. All of this helps you attract and retain the next generation of finance professionals.
*Five CFO
predictions
for 2023*
Tim Wakeford, Vice President of Product
Strategy, Workday, shares five predictions
on how the role of the finance function will
change over the next 12 months and
offers advice to finance leaders to help
them turn challenges into opportunities.
Please add your details to read this article, or choose another article via the contents.
Five CFO predictions for 2023
CFOs must prioritise agility and reinvention in response to the fast-changing macroeconomic environment
In this environment, CFOs will be expected to lead the company through challenges, outmanoeuvre the competition, and emerge stronger on the other side. This requires finance leaders to be agile, prioritise in new ways, and rethink what is possible in terms of technology and processes. CFOs and their teams will not only bring together the power of data and technology to eliminate data silos but also reinvent processes to streamline and simplify data access and decision-making.
Increased trust between the CFO and CIO will continue to be critical
CFOs have traditionally been focused on digital transformation within finance. But today, they are more broadly focused on enterprise-wide innovation. Over the next year, IT and finance will need to work together to harness new technology effectively. As both the CFO and CIO roles evolve to focus on creating business value, trust and collaboration between these two leaders will be paramount to continued success, especially in an uncertain environment.
Data science skills will play an increasingly important role in finance’s ability to create business value
Financial integrity and risk management will continue to be table stakes for the organisation, but as the role of finance evolves to be more strategic and agile, the ability to find, analyse and mine terabytes of data for insights will be in equal demand to more traditional financial skills. Data is one of any organisation’s most valuable assets, and how you harness that power matters. Every CFO will be on the lookout for top talent in data science – from data analytics to data management – as well as skills in the fields of AI, ML and data storytelling.
Your tech strategy will become your hiring and talent retention strategy
Employees want to do meaningful work. For finance and accounting teams, that means doing more than manual data input or living in spreadsheets five days a week. In today’s talent market where skilled finance workers are at a premium, more than ever, employee experience will be paramount to building – and retaining – a skilled and agile finance team. When teams leverage technology to automate manual processes, they can instead focus on finding anomalies or data trends that help the business understand the ‘why’ behind the numbers, acting as a more strategic partner to the business.
The journey to zero-day close will drive further adoption of accounting automation
Traditionally, reconciling financial statements at the end of a reporting period – whether monthly, quarterly or annually – has been a labour-intensive process that can take weeks to complete. But one of accounting's most ambitious goals is aiming to change that: a zero-day close, leveraging continuously available, up-to-date information to close the books at any time. While a zero-day close is the ultimate goal, it’s the journey to this goal that will result in incremental day-to-day process improvements – such as automating manual data entry for invoices or manual journal creation – to truly advance the finance function.
What are your priorities for 2023?
- Eliminating data silos
- Collaborating more with IT
- Adding new skills to my team
- Making work more meaningful
- Improving and simplifying processes
*How European finance leaders are preparing for a post-pandemic world*
Steve Dunne, EMEA Staff Writer at Workday, shares insights from his conversations with finance leaders from Atlas Professionals, ÏDKIDS, Kainos, KPMG, N26 and Veolia
By Steve Dunne, EMEA Staff Writer
As businesses across Europe take the first tentative steps toward normality following the worst of the COVID-19 pandemic, attention is now turning to how to prepare for the future. Finance leaders from the Workday customer community discuss resilience, digital transformation and some of the lessons learned.
While no one truly knows when the COVID-19 pandemic will come to an end, according to Deloitte’s ‘European CFO Survey: Spring 2021’, a new wave of optimism and a renewed willingness to invest prevails across Europe, with many companies ‘turning the page on COVID-19 and focusing on post-pandemic reality’.
During a turbulent 18 months, finance leaders throughout Europe have faced a myriad of challenges which have altered the way their organisations operate. Louis de Miscault, CFO and Performance Director at ÏDKIDS, a French-based community for children and parents, said restoring confidence and improving visibility of finance metrics are among their top challenges.
“We’ve had a year of shops closing and even the country shutting down. We’ve seen cash flow become increasingly important. The challenge for the financial director is to build up a picture of cash over the long term and give reassurances to our stakeholders, shareholders, partners and employees. Managing working capital and making that data available to those who need it is so important," said de Miscault in an interview for the report.
Matthew McManus, Group Head of Finance at Ireland-based software company Kainos, highlighted the need to manage change and protect the culture of the organisation as major priorities as we emerge from the pandemic.
“The major thing is navigating a changing environment and that means protecting our strategic objectives to attract, develop and retain the best talent available” said McManus. ”It’s about protecting our organisational culture and ensuring our new hires, graduates, senior and entry-level staff can hit the ground running."
Learn how N26 uses Workday to support its growth and mission to delight customers with the world’s best digital banking experience.
Read Customer Story
For other businesses, such as Germany-based neobank N26, the pandemic meant a shift in the pace of digital acceleration both from a customer and an employee perspective. “In 2019, we were coming off the back of a period of hypergrowth, with 1,500 employees and seven million customers in 25 markets” said Arno Schleussner, Director of Finance at N26. “The lockdown may have ground other sectors to a halt, but it was the opposite for us. We saw an explosion in demand for online banking, especially on mobile devices and not just early adopter customers. The big challenge for us was to accelerate our innovation once again and update our product range to meet the huge demand we were seeing."
We went ahead with the deployment of Workday for two reasons. First, our old finance system could not provide the information we required and that the business needed. The second was that we wanted to have some form of financial reporting in
place to support us during the pandemic. I’m delighted that we made that decision.
André Secrest, Group Controller at Atlas ProfessionalsPressing accelerate on finance transformation
If finance transformation had been put on the back burner prior to the pandemic, then finance leaders have now pushed it to the top of their lists. In a report from KPMG, Patrick Fenton, Leader of the Global Finance Centre of Excellence at KPMG International, detailed the significance of digital transformation for today’s finance function, particularly in reducing costs.
“Cost is a big driver in our post-COVID-19 world. And businesses save on costs when things are done more efficiently," Fenton said. “With the data at your fingertips, you can make faster, more economic decisions. By definition, you are then also building in more resilience.”
This school of thought was backed by Kainos’ McManus in the Deloitte report. He believes that organisations with a head start on digital transformation have coped better during the pandemic and cited examples of his own company’s finance acceleration.
“The businesses that hadn’t started on their digital journey will have struggled to navigate the last 18 months, especially the early weeks when things were particularly volatile. We’ve been working on finance transformation for a few years now, so we were able to deliver for our customers and employees remotely without interruption," he said. “We were able to use Workday Financial Management and Workday Adaptive Planning seamlessly, especially during that uncertain phase. I think many companies had a big shock when the lights went out if they hadn’t invested in digital before.”
Discover how one platform for financial management and human capital management is helping Kainos to drive growth and efficiency.
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Atlas Professionals is a Netherlands-based provider of recruitment and HR services, with a focus on the energy and marine sectors. When COVID-19 hit, the company was in the middle of their Workday deployment and had a tough decision to make – pause or carry on with the deployment. André Secrest, Group Controller at Atlas Professionals, explained the decision to accelerate the transformation project.
“We faced two headwinds – a huge rise in oil prices and the COVID-19 outbreak, both of which impacted our business. Despite this, we went ahead with the deployment of Workday for two reasons. First, our old finance system could not provide the information we required and that the business needed. The second was that we wanted to have some form of financial reporting in place to support us during the pandemic. I’m delighted that we made that decision," Secrest said.
Schluessner, from N26, explained the importance of accelerating finance transformation – not just within the function itself, but across the entire company.
Find out how Veolia unlocked finance agility during a global crisis.
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“We decided that, as a finance function, we want to spearhead the entire transformation of the company and that extends to processes, technology, and the way we work collectively. That’s the most telling impact finance transformation has had on our business in the last year," he said.
Collaboration is key for the future CFO
“Today, the role of the CFO is really to be the partner to the CEO and the business," said Aneel Bhusri, Co-founder, Co-CEO and Chairman, Workday, at a recent Fortune CFO collaborative event. Despite this increased need for partnership, finance has traditionally struggled to achieve effective collaboration with the C-suite. Why has this been the case?
Atlas Professionals’ Secrest explained his company’s approach. “We have five finance hubs and, with our legacy finance system, each used to have their own slightly different way of working. Collaboration actually meant calling one another and asking what the data really meant. That wasted a lot of time. So now, collaboration means spending 80% of our time looking at the reasons behind the results rather than getting the inputs right," he said.
At Kainos, McManus, the Group Head of Finance, had a similar sentiment. He discussed the shift from finance as a transaction steward into a much more progressive partner with the ability to deliver data to those who need it.
“I think we’re starting to see more of a focus on reporting and business partnership and less on process completion as that becomes more automated,” he said. “It’s about delivering insights and data to the parts of the business that are growing and ensuring you are collaborating and communicating effectively."
Lessons and learnings from the finance function
There is no clear definition of what ‘normal’ will look like. However, many finance leaders have led from the front during the pandemic, playing pivotal roles in guiding their organisations through the storm. What are the key takeaways for businesses from both the pandemic and how they approach the future?
Paul Voisin, Global Transformation Leader at French-based Veolia, a water management, waste management and energy services company, points to the importance of recruiting those with passion and expertise in finance transformation. If businesses are to make the most of their finance system, they must find the right people to guide the business.
“You need people who are truly passionate and who understand SaaS deeply. We must understand all that these systems can do, because the potential is endless. Also, you must match the framework and processes with the data to build up a complete picture. Above all, you need to make this a long-term commitment and not something you throw money at and leave in the corner,” said Voisin at a Workday Elevate event.
De Miscault, of ÏDKIDS, was clear in his advice to other CFOs: The time is now.
“I think the time has come to stop waiting for digital transformation to happen to us. More than ever, CFOs are here to provide a service to the rest of the business. We’re in a position to transform how they think about data and how they use it; also how they automate important processes to be even faster and more efficient,” he said. “I like to think of the CFO as a co-pilot to other business leaders, helping them to slow down when there is a risk ahead and speed up when the road is clear."
Cost is a big driver in our post-COVID-19 world. And businesses save on costs when things are done more efficiently. With the data at your fingertips, you can make faster, more economic decisions.
Patrick Fenton, Leader of the Global Finance Centre of Excellence at KPMG International
*High tech CFOs:
Evolving into the future*
Anne Peabody, Eric Noren and Michael Di Stefano from Accenture highlight the opportunities for
high tech CFOs
By Accenture experts:
Annie Peabody, Managing Director, Strategy and Consulting, CFO & Enterprise Value
Eric Noren, Managing Director, Strategy and Consulting, CFO & Enterprise Value
Michael Di Stefano, Manager, Strategy and Consulting, CFO & Enterprise Value
After decades as the disruptor, the high tech industry faces significant challenges and not just from the pandemic. Rapidly evolving customer demand, emerging technologies and blurring lines between industries were already putting tech companies under pressure to adapt. The pandemic and mounting global tensions continue to add new layers1. And while we adjust to the reality of managing constant volatility, the new normal is rapidly transitioning to the never normal. The good news is that these challenges present high tech CFOs with an unprecedented opportunity to play an essential part in positioning their organisations to thrive, now and in the future. By expanding their roles beyond their traditional functions, CFOs can play a strategic and highly valued role in helping their companies manage change and come out stronger and more competitive than ever before.
In ‘CFO now: Breakthrough speed for breakout value’2, Accenture research revealed that most CFOs are elevating their roles and taking on new responsibilities. High tech CFOs, in particular, are clearly in the lead for embracing digital capabilities. Most are drawing on the digital fluency wound into the DNA of their companies to convert data to insights and lean into the role of trusted advisor across the enterprise. They’re aggressively applying modern tools such as artificial intelligence (AI) and machine learning (ML) to not only automate daily tasks, but also uncover new growth opportunities and ‘see around the corner’ to the next major challenge.
Our research2 also shows that there are further opportunities for high tech CFOs to elevate their roles. By expanding collaboration with stakeholders across the enterprise, they can manage more complex and interconnected risks and help guide business strategy. To fully leverage their opportunities, they need to continue developing high tech finance talent, equipping team members with new skills and codifying new ways of working.
High tech CFOs who build on their digital prowess, master cross-functional collaboration and prioritise talent development will be able to better collaborate with C-suite peers to drive strategic change with agility. They’ll provide the technical and business guidance to help their organisations manage the growing volatility of the modern business environment. These finance executives will distinguish themselves and differentiate their companies over the competition as they navigate the challenges of today’s ‘never normal world’.
The CFO evolution
Every two years, Accenture conducts a global survey of finance leaders across industries to gauge their sentiments and produce our CFO Now report2. In the latest version, we surveyed more than 1,300 CFOs across 15 industries, augmenting the data with qualitative interviews and analytics. This exercise took on a special importance given today’s challenging business environment. The results uncovered valuable insights into how global forces and market dynamics are affecting CFOs and the companies they run.
Our research revealed2 that elite CFOs are stepping up to guide the organisation, moving beyond their traditional reporting duties to identify opportunities that drive value. As part of that transformation and in response to escalating responsibilities, CFOs are embracing three distinct roles: economic guardian3, architect of business value4 and catalyst of digital strategy5.
Effectively executed, this evolution equips CFOs across all industries to rapidly pivot to new market opportunities and address new sources of disruption.
While high tech CFOs outperform their peers in several areas, they still have an opportunity to further advance the goals of the organisation in two key areas.
Shining a spotlight on high tech
Narrowing in on high tech, we see an industry experiencing an enormous amount of change. Consumers demand a constant stream of new and personalised products. The traditional lines between customer and supplier are blurring as industry convergence takes hold. The pandemic, natural disasters, trade wars, and geopolitical conflict have left supply chains in disarray. Meanwhile, high tech is on the rising slope of a massive demand spike from technologies such as 5G and the Internet of Things.
Historically, the high tech industry has been the catalyst of disruption, so being on the receiving end of disruption is a new experience. Given the increasingly central role CFOs play in helping enterprises navigate choppy waters, we analysed our survey results for insights on the industry’s response.
We observed a pair of interesting trends that are specific to high tech. First, high tech finance executives as a group are outperforming the larger CFO community in key areas around digital transformation2. Empowered by this digital savviness that exists in high tech companies, these CFOs are more likely to capitalise on digital investments to streamline their operations and further adopt technology that supports predictive, data-driven decision-making. This set of capabilities positions them to exceed their peers in terms of their ability to fulfil the three roles that today’s CFOs are asked to play in order to navigate volatility today and in the future.
Our second major finding was that while high tech CFOs outperform their peers in several areas, they still have an opportunity to further advance the goals of the organisation in two key areas.
Our research revealed that elite CFOs are stepping up to guide the organisation, moving beyond their traditional reporting duties to identify opportunities that drive value.
One area for improvement is to increase collaboration with their supply chain and operations colleagues. By supporting these key stakeholders with the data and insights that finance generates, CFOs can help the company manage risk and drive growth.
Another opportunity area for high tech CFOs is to focus on their talent agendas. The type of innovation and resilience required to thrive amid current business challenges calls for different skills and ways of working across finance. To innovate and help lead the charge for their organizations, high tech CFOs need to invest in training and staffing. They need to craft a strategy to ensure they have the right people and the right structure in place to take full advantage of the capabilities and infrastructure they are building.
While high tech CFOs are operating from a strong base of expertise, our analysis shows that they have additional opportunities to advance the enterprise and the finance organisation, while preparing for future challenges and change.
Areas where high tech CFOs excel
The unique role of high tech companies as digital innovators and champions keeps the focus on forward-looking technologies across the entire organisation, including finance. This digital fluency has given high tech CFOs an edge over their peers in two key areas: unlocking the real value of data and adopting digital tools.
Unlocking the real value of data
High tech companies have a long history of digital and cloud investment. These capabilities are ostensibly to support the development of innovative products and services, but the resources and digital mindset extend across the organisation. As a result, high tech CFOs are ahead of their fellow CFOs in using data differently to create value and provide new insights.
According to our survey2, high tech CFOs are 74% more likely than their peers to use AI to create new market insights. These high tech finance executives are consistently identifying and analysing new data sets and delivering valuable insights to their C-suite peers to help place bets for the future and be prepared for a never normal world. They are more focused than their peers on analysing market data and making connections between internal and external data sources in pursuit of insights that drive value from merger and acquisition (M&A) targets to emerging markets.
High tech CFOs are leveraging the awareness and expertise of data and analytics that exists across their organisations. They’re going beyond one-off work streams or projects to develop an enterprise-wide ‘decision science’ capability similar to ‘sales effectiveness’ or ‘pricing excellence.’ They take the digital expertise that is pervasive within the company and use it as a springboard to innovation.
Adopting digital tools
High tech companies are in the unique position of both creating modern tools such as AI, ML and cloud and also applying these tools to further the business. Our research2 shows that because of this digital sophistication, high tech finance teams are more likely than their peers to be applying these new technologies. For example, 81% of high tech CFOs are using ML to process financial data, versus 68% of overall CFOs. And 38% of high tech CFOs have successfully enhanced operational efficiency through AI and other technologies.
Across finance, high tech leaders are using digital tools to further their ability to partner with the business. This enables high tech CFOs to increase resiliency and navigate disruption by combining AI-based models with real-time data to visualise end-to-end value chains and business processes. Armed with these insights, they can uncover friction and root causes of errors, deviations, and value leakage. They are leaning in to find new and different ways to harness the value of data, focusing on increasing efficiency and providing insights to collaborate across the enterprise. These capabilities help the finance organisation be more agile in the face of changing market conditions and improve forecast accuracy.
Next areas of focus
While high tech CFOs are operating from a strong base of expertise, our analysis shows that they have additional opportunities to advance the enterprise and the finance organisation, while preparing for future challenges and change. As stated above, key action items include tighter collaboration with supply chain peers and a focused talent agenda.
Anticipating revenue risks
High tech CFOs are ahead of other CFOs in collaboration and sharing insight across most of the C-suite. Survey data shows that 81% have a track record of providing data for risk analysis, compared to 70% of all CFOs. The one area where collaboration could improve is with their supply chain and operations counterparts. Our survey data shows that less than 20% of high tech CFOs are using data to manage operational risk. Additionally, only 35% of high tech CFOs are using data to assist the organisation in preparing for future volatility.
The gap in collaboration with supply chain and operations is symptomatic of a need to overcome historical organisational silos and should be an area of concentration for finance teams. Looking forward, finance organisations should run analytics on internal and external data to identify potential vulnerabilities and determine the possible impact on revenue projections earlier6. Finance teams need to use their access to data and expertise in analytics to help anticipate supply chain risk and its potential impact on revenue, applying all the tools at their disposal to help the organisation ‘see around the corner’.
The gap in collaboration with supply chain and operations is symptomatic of a need to overcome historical organisational silos and should be an area of concentration for finance teams.
Conclusion
Volatility is a fact in this ‘never normal world’. This particularly holds for high tech companies, which face a unique set of challenges ranging from a rapidly evolving competitive landscape to massive demand spikes to reimagining their business models. According to our CFO Now research2, high tech CFOs are tackling these challenges head on, transforming their roles and increasing their ability to provide insights to the C-suite. While this elevation is consistent with what peers from other industries are doing, our data shows that high tech CFOs are pushing the envelope. Powered by the digital prowess inherent to high tech companies, these CFOs have become the leaders in unlocking the value of data and adopting digital tools in finance. However, opportunities do exist for them to further excel and realise the promise of the moment.
High tech finance executives need to focus on tighter collaboration with the operations and supply chain organisations to mitigate risk and help navigate disruption. They also need to continue retooling the finance organisation, moving beyond traditional roles and investing in their talent strategies including different ways of working.
Taking these actions can help high tech CFOs further solidify their position as strategic advisors across the C-suite and increase the competitive position of their companies. These expanded roles will continue to elevate high tech CFOs and enable them to be instrumental in guiding their companies through future disruptive forces that may come their way.
Are you and your finance teams ready to evolve into the future by turning never normal challenges into opportunities?
Note: this article originally appeared on Accenture.com
Transforming the industry that transformed the world, Accenture, July 2, 2021.
CFO Now: Breakthrough speed for breakout value, Accenture, Feb 9, 2021.
Economic guardian: Leading the finance function, Accenture, Feb 9, 2021.
Architect of business value: Leading collaboration, Accenture, Feb 9, 2021.
Catalyst of digital strategy: ROI on technology, Accenture, Feb 9, 2021.
Is your high tech supply chain prepared to weather disruption?, Accenture, April, 2022.
*Finance as a driver
of transformation:
What CFOs need to enable organisational change*
Bruno J Navarro, Staff Writer at Workday, on how CFOs can be a driving force for change
By Bruno J Navarro, EMEA Staff Writer
My company is still too reliant on manual processes?
Technology-savvy and analytics capabilities help finance leaders forge the strategic partnerships they’ll need to prepare their organisations for the future. Executives from Deloitte Consulting LLP and H&R Block discussed their journeys at a recent Fortune event.
From her professional vantage point, Amy Shaw Feirn, Deputy CEO, Partnerships and Offerings at Deloitte Consulting, has the unique opportunity to witness a variety of CFO transformation journeys – and the successful finance leaders are those who operate as strategic partners.
“A distinguishing factor I see in CFOs is that they see their role as way more than scorekeepers,” said Feirn. “The CFO has a better sense as a leader of many other things that make these enterprise-wide transformations more successful."
It’s critical for a CFO and the team surrounding the CFO and the finance function to be as tech savvy as possible right now.
Feirn said she helps CFOs from a variety of industries embark on their transformation processes, whether it involves an enterprise resource planning (ERP) project, reimagining an operating model, or navigating mergers and acquisitions (M&A) activities related to an integration.
“Thinking about finance as an analytical capability as opposed to a function is huge,” she said, adding that CFO insights can provide a deep understanding of the organisation’s operating model. “CFOs get the nitty-gritty of what would need to change in areas of the organisation during a transformation that are often very overlooked, and really, really important to getting it right and keeping it on time.”
Identifying the need for financial transformation
“Transformation is one of those words that gets so overused in business,” said Jeff Jones, President and CEO at H&R Block. “For us, it literally means repositioning the business for the next generation."
While the iconic brand is practically synonymous with consumer tax preparation services, Jones said H&R Block had stopped growing and had begun losing clients. Noting that the business generates a robust free cash flow, Jones said the process it started in 2018 wasn’t exactly a turnaround.
“We talk about it as a crisis of relevance,” he said.
For Jones, the process needed a strategic partner. He found that in CFO Tony Bower, who has been at the company for 17 years.
“When we think about driving transformation, the first thing that mattered was alignment on the problem that we had to solve,” Jones said. “When you have a partner that deeply understands the business and is in it day to day with you, that’s kind of a ‘CFO-plus’ role and I’m very fortunate to have that."
Jones added that he relies on his CFO to provide a critical perspective.
“I couldn’t imagine somebody who didn’t just tell it to me straight all the time,” he said.
Feirn added that the CFO’s framing and strategic lens is valuable. “The question I always hear from our CFO is, ‘tell me what you want to achieve and I’ll tell you how we’re going to do it,’” she said, adding that alignment in developing a transformation road map is preferable to arguing whether it’s the right strategy.
What finance transformation looks like
Jones acknowledged the pressure that can come from those who track the company’s stock price.
“We all get frustrated with how the market sees your performance, but when you’re really focused on a multi-year repositioning of the business, you’re going to be in zones not all investors like – and to have the courage to do that side by side, every day, is just incredibly important."
For H&R Block, finance transformation involved a robotic process automation (RPA) programme that streamlined such tasks as expense report approvals or hiring and onboarding seasonal employees. Jones said RPA now handles roughly 35 processes throughout the organisation and saves in excess of 50,000 person-hours per year.
The programme has allowed executives to think more about machine learning (ML) models and finding the right balance between automating tasks and helping employees be more strategic and valuable.
CFOs get the nitty-gritty of what would need to change in areas of the organisation during a transformation that are often very overlooked, and really, really important to getting it right and keeping it on time.
Amy Shaw Feirn, Deputy CEO, Partnerships and Offerings at Deloitte ConsultingBower noted that while the RPA programme has been successful, it also required finance leaders to collaborate closely with IT in order to manage and maintain data flows. “You really need a high volume of processing you can automate to make it worth the investment,” he said.
The critical skill to enable finance transformation
A keen understanding of technology is a key element for finance leaders, Feirn said.
“It’s critical for a CFO and the team surrounding the CFO and the finance function to be as tech savvy as possible right now,” she said. “You don’t have to be a cloud-native developer or a software developer in order to understand the influence of technology on how the organisation’s business model is going to change.”
Noting that Deloitte is now undergoing such a process to include both professional services and products, Feirn said the CFO plays a key role in understanding how both technology and operations must adapt to support different revenue recognition and receivables management.
“CFOs have an understanding of the degree of change management required to succeed in that transformation,” Feirn said. “The ones I know who understand and partner in a way that is more than just keeping track of the transformation but provide insights on the operating model – those are the CFOs that really distinguish themselves.”
