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What’s Keeping Today’s CFOs Up at Night?

Today's CFO has a big job.

Being at the helm of finance while forecasting for the future is just the start. It's a position that continues to expand - both in complexity and in consequence. As today's chief financial officer considers technology and infrastructure investments a necessity to compete and be successful in a dynamic business environment, they're also cautiously assessing the financial state of the future.

It’s constant budgeting, planning, forecasting, balancing, analyzing, assessing and managing. So, what’s on the minds of today’s CFOs? And, what’s keeping them up at night?

Preparing for the Future

Deloitte’s CFO Signals™ survey, a quarterly tracking of the thinking and actions of leading CFOs, reported that nearly 75 percent of CFOs are anticipating a slowdown by the end of 2020. Despite strong assessments of the current North American economy, CFOs’ expectations for the North American, European and Chinese economies were among their lowest levels in the last two years.

Similarly, Duke University’s Fuqua School of Business / CFO Magazine Global Business Outlook, which polls recession by the third quarter of 2020.

And yet, CFOs expect their capital spending and revenue to increase by five percent over the next 12 months and for hiring to increase by two percent.

The uncertain economic forecast and unpredictable trends has today’s CFO watching the market—closely.

Investing in Technology

In a 2019 CFO survey by Grant Thornton, “All systems go: CFOs lead the way to a digital world,” CFOs revealed how they view and plan to prioritize the digital transformation journey for their organizations.

A couple of findings include:

-Within the next year, financial professionals plan to adopt and invest in: advanced analytics (28%), OCR (26%), machine learning (24%), AI (24%), and blockchain (24%).

-The survey findings also indicated that of the financial processes being automated today, 46 percent have automated accounts payable and receivable, 44 percent of automated financial reporting and control, and 43 percent have automated financial planning and analysis.

In addition to holding the purse strings to these business-critical investments that are transforming the finance function and guiding strategic decision making, CFOs are at the forefront of using these technologies themselves.

Today’s CFO isn’t using your grandfather’s calculator anymore.

Keeping Up Appearances

Gone are the days of the back office financial executive. Today’s CFO, like all other C-level positions, is highly visible. Like CEOs, employees expect a certain amount of access to the chief financial officer.

Research conducted by Bersin by Deloitte suggests that the issues of “retention and engagement” have risen to the number-two spot in the minds of many business leaders, second only to the challenge of building global leadership (more on that next). And like CEOs, CFOs are taking an active role in building organizations that engage employees as “sensitive, passionate, creative contributors.”

Action groups and thought leadership platforms specifically for CFOs, like Deloitte’s CFO Program and the Wall Street Journal’s CFO Journal, are working to help CFOs stay ahead of new demands and growing challenges, like managing the complexities of their roles, tackling their company’s most compelling challenges, and adapting to strategic shifts in the market.

The hands of today’s CFO are in all facets of the business, not solely finance. They, too, are the face of the business.

Going Global

Industrialized economies are fluid and the footprints of leading organizations are largely global. This is nothing new as of late, but the financial implications of being a global organization are complicated and ever-changing. Today’s CFO has to be highly adept at learning fast and staying up to date on rules, regulations, compliance, and tax laws. They must be quick to understand what makes good financial sense and what ultimately may be deemed too risky.

A 2013 CFO Research survey of CFOs and other senior executives at companies with annual revenues of $50 million to $1 billion found that 95 percent of respondents expected to have customers in at least two international countries within three years. And those predictions have come to fruition.

Today’s competition, for both marketshare and talent, has CFOs and other strategic business advisors looking beyond domestic markets to grow and become more profitable. For CFOs, this has resulted in an incredible amount of planning, culture immersion, risk assessment, and other pre- and post-implementation to-dos that also tend to have ongoing implications.

Privately held or publicly traded, globalization—and the ability to think globally—has become an integral part of the role of today’s CFO.

In addition to running the finance department, today’s CFOs are among invited guest speakers, there are awards that have been erected in their honor, and they have obligations far outside of their more traditional roles of yesteryear—quite literally, their new role has taken them to the ends of the earth.

On the minds of today’s CFO is digital transformation, data, globalization, risk, regulations, and increasing stakeholder expectations. Their role has never had so much influence or responsibility, and both continue to expand.

 

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