Surveys executed just before and during the pandemic exhibit the coronavirus disaster may possibly be reshaping the role of the CFO, with senior finance executives shifting their aim to crafting method and producing small business benefit.
CFO Research (section of Argyle Advisory and Research Expert services) and Grant Thornton surveyed 631 CFOs and other senior finance executives in February, then adopted up with a study of 174 CFOs and senior finance executives in May, to gauge the consequences of the COVID-19 upheaval.
In addition to the switching aim of CFOs, the surveys revealed widescale delays for innovation tasks, a renewed appreciation for small business method competencies, cybersecurity cost raises, and enjoy for advanced analytics and artificial intelligence.
Roles and Responsibilities
The February and May surveys confirmed that the role of the CFO shifted when the pandemic strike. In both equally surveys, the executives ended up requested how significantly of CFOs’ time would be spent in these 4 roles: strategist (crafting company method) transform agent (producing small business benefit) producer (standardizing and automating transactional procedures) and guardian (standardizing regulate and compliance procedures).
In February, the study respondents reported that CFOs’ time was divided rather similarly across the 4 roles. But by May that balance had shifted in response to the COVID-19 disaster: strategist and transform agent roles ended up having far more of CFOs’ time when compared with the producer and guardian roles.
In spite of the clear change to far more ahead-seeking tasks, the coronavirus pressured a big the vast majority of CFOs to set off or transform their designs for innovation tasks. Eight out of 10 surveyed finance executives had delayed or reshaped innovation tasks in May. Sixty-two % of the respondents reported that the COVID-19 disaster had delayed their transformational tasks whilst 19% mentioned the disaster had reshaped their tasks and they ended up pursuing a unique strategy. The remaining 19% reported that the disaster had accelerated transformation tasks.
Delaying and reshaping innovation tasks doesn’t imply they are extinguished. Additional than ninety% of 335 finance professionals polled during a Grant Thornton webinar in June mentioned they prepared to continue to innovate, even during the COVID-19 downturn.
Automation Stays the Program
State-of-the-art analytics and artificial intelligence ended up favored groups of automation technology in both equally the February and May surveys.
A the vast majority of the executives in the May study reported that their designs for implementing automation technologies had not been delayed by the pandemic. Additional executives slated advanced analytics for accelerated implementation (29%) than they did any other class of technology. Synthetic intelligence was a close next at 23%.
The February study had requested executives when they envisioned to put into action a listing of specified automation technologies. Most respondents (55%) had previously executed advanced analytics. Optical character recognition was the next-most-previously-executed automation technology, at forty%. Synthetic intelligence had the maximum share of prepared implementations within just 12 months (33%), adopted by robotic course of action automation (thirty%).
In a December 2019 recession preparedness study by Grant Thornton, 70% of respondents reported designs to maximize their electronic investments in innovation/technology, electronic transformation, and/or cybersecurity, even amid developing signs of a slowdown. In the February CFO study, about 70% of the senior finance executives reported they had both executed critical rising technologies or they would be implementing them within just two decades.
When requested in May about how expenses would transform around the next yr because of COVID-19, cybersecurity had the maximum share of executives projecting raises (forty four%) adopted by IT/electronic transformation (forty%), coaching and growth (22%), functions (21%), and advertising (19%). Not astonishingly, the groups with the most affordable projections for cost raises ended up vacation (four%), actual estate (six%), recruiting (seven%), and workforce (seven%). Ninety % of the executives projected their vacation expenses would lower.
Love for Business System
Fitting with the finding of CFOs looking at them selves in far more strategic roles during the pandemic, the finance executives surveyed held small business method competencies in significant regard.
They saw small business method as an important skillset both equally just before and following the onset of the pandemic. Operations management competencies ended up approximately as valued as small business method competencies in the pandemic disaster surroundings. When finance executives ended up requested which important skill they had leveraged because of the coronavirus disaster, the most-cited respond to was small business method, decided on by 34% of the executives, adopted by functions management (29%). Info analytics and innovation/entrepreneurship ended up tied as the third-most-cited major competencies drawn on during the pandemic, at 10%.
The February study requested a related concern — what ended up the most important skillsets respondents would like to build within just their finance operate? Info analytics and small business method ended up the most-cited responses, by 23% and 22% of the respondents, respectively, adopted by software growth (17%) and buyer knowledge management (eleven%).
There’s no question that small business method growth was not the only included accountability for CFOs arising from the pandemic-induced recession.
Amid the quick-phrase priorities and long lasting impacts of the pandemic, the executives in the May study independently mentioned:
• lessened capex
• the potential to order a lot less-nicely-capitalized organizations
• lessened funds circulation impacting credit card debt covenants
• source prioritization in the confront of constrained offer chains and
• extended-phrase implications of an ever more cellular workforce on business space, recruiting, and vacation.
Most of those people impacts will continue to have a big affect on what CFOs invest their time on in the coming months. Respondents mentioned they ended up looking at CFOs branching out into new areas of organizational management, these as main creation and procedures, managing layoffs and shuttering functions, operating with small business models to build a number of producing resources, managing remote workforces, partnering with the neighborhood, and interacting with investors.
In the common scope of finance, new areas of aim for some finance chiefs involved acquisitions and divestitures, moves to preserve funds and means, coronavirus monetary-impact models, expenditure chance, forecasting and budgeting, payments and funds circulation management, chance mitigation, liquidity management, earnings growth, and price tag reduction. Paycheck Protection Program documentation and assessment also appeared on the listing.
Amid the new areas of aim within just technology management, finance executives mentioned relocating all functions to paperless, implementing operate-from-house technologies, and overseeing IT and protection.
And one particular government mentioned a-not-unfamiliar CFO role:
Keith Button is a freelance writer based in Valley Cottage, N.Y.