What next for the CFO?

Aoife Donnelly and Thady Duggan explain how the role of the chief financial officer will evolve as digital change continues apace.

As chief financial officers (CFOs) continue to take on more responsibility for strategy and execution, and for the sustainable future of the enterprise, they must build technology strength to unleash breakthrough speed. Doing so is the way to drive breakout value across the business. Accenture’s recently published report titled CFO Now: Breakthrough Speed for Breakout Value identified themes common to a select group of CFOs who deliver significant value to their organisations.

We found that, aided by digital transformation, the pace of change is greater than ever before. This was further accelerated by the pandemic, with 79% of CFOs surveyed compelled to ramp up organisational transformation due to the effects of the past year.

As chief executive officers (CEOs) embrace speed by accelerating their digital transformation, they turn to finance for guidance. The pace at which finance can support business leaders in real-time is critical and has resulted in the accelerated adoption of digital technologies in the finance function. CFOs said that 60% of their traditional finance tasks have been automated in our CFO Now research, up from 34% three years ago. 

Some CFOs are delivering real value from their digital transformation. Our research identifies several key characteristics of these ‘winners’ – finance teams that can provide the business with insights to drive transformation with speed and agility.

Economic guardians

Compared to their predecessors, the breadth of responsibility and expectation faced by today’s CFO is increasing. To thrive with this increased responsibility, the finance function must transform itself to enable CFOs to support the rest of the business effectively.

The pace of technological change in recent years has opened opportunities within finance. Huge strides have been made to optimise processes, maximise the capabilities within existing enterprise resource planning (ERP) systems, and implement other technology enablers.

However, this is using today’s technology to fix yesterday’s problems. Timely, accurate, and complete reporting is important, but it should be considered a mere hygiene factor for a high-performing finance function. The business needs informed guidance to navigate the present and anticipate the future, not comfort for the past.

That’s where the most significant shift is occurring in the role of CFOs as economic guardians. High-performing finance functions can and should provide predictive insights, but less than half (43%) of CFOs surveyed have used advanced financial modelling in the past two years to identify future risks and opportunities. How can CFOs be economic guardians if they don’t have a perspective on what tomorrow will bring?

High-performing CFOs use internal and external data with advanced models to better understand leading indicators of demand well ahead of trends that might show up in the company’s profit and loss account. Others, however, are not sure how to maximise the benefits of digital transformation – only 21% of CFO Now respondents have used operational data to identify new sources of value, and only 20% have used macroeconomic data to support their forecasting.

Cloud architectures offer a whole new world of possibilities to the CFO, allowing for much faster decision-making. Yet, only 23% of CFOs use the cloud to provide new insights and only 16% use it to identify new sources of value.

Combined with this data and technology utilisation comes a renewed focus on aligning and nurturing talent within the finance function. According to Accenture’s latest CxO Pulse Survey, 75% of CFOs believe that their company is on a course to redesign how people work and reinvent their culture to support new behaviours and mindsets.

CFOs understand that finance professionals can’t be left out of this talent revolution. Our CFO Now research shows that they are acting by re-prioritising the skills needed in their functions. Traditional finance and accounting skills are still important but, along with general management skills, are now among the lowest priorities. The top skills being actively introduced are data exploration and analysis (41%), followed by scenario planning and horizon scanning (38%), innovation (37%), and storytelling (34%).

Architects of business value

CFOs have always played an important role in the organisation, but they now increasingly influence and direct value creation across the enterprise. This enhanced role requires increased collaboration between the finance function and other parts of the organisation, with 86% of CFOs surveyed increasing the frequency and scope of collaboration across the C-suite. The current pandemic and the strains it has placed on business has changed mindsets at the C-suite level, turning what was once a competitive environment into a more collaborative one that enables the CFO to deliver on their expanded role.

Leading CFOs understand the power of technology to support these efforts and take appropriate action to ensure that they play a significant role in any major technological decisions. Indeed, 72% of respondents said they have the final say on the technological direction of the enterprise.

Catalysts of digital strategy

The modern CFO needs to champion digital transformation across the enterprise to support the central theme of our research – breakthrough speed for driving breakout business value. Outside their own function, there are three key areas where the impact of digital strategy are most striking.

1. Business models: our research shows that 41% of CFOs are driving new business models within their organisations. That’s a great start, but it still falls short of the 72% of CFOs who thought their business would need to completely re-think processes and operations to be more resilient in the face of impending disruption. Throughout the past year, organisations had to reconsider their business model and its resilience for the future. Irish companies have used this crisis as an opportunity to reassess their ambitions, using the shift to digital to re-evaluate their global ambition and identify business lines, markets, and other opportunities that were not considered possible before.
2. Security: the most cited barrier preventing CFOs from realising their full potential as drivers of strategic change was concern about cybersecurity. Yet only 28% of finance professionals are engaged in managing risk through data security to a meaningful degree. In many organisations, chief technology officers and chief risk officers report to the CFO. Given this responsibility, it is incumbent upon the CFO to better understand and become more actively engaged in data security.
3. Environmental, social and governance criteria: one striking finding from our CFO Now research was the extent to which CFOs are seen as responsible for their company’s environmental, social and governance (ESG) policies. In fact, 68% of respondents said that CFOs take ultimate responsibility for ESG performance within their enterprise. Driven by the growing concern about the global climate crisis, Irish CFOs are also trying to understand their role in any future ESG reporting requirements.

The impact on the finance function

The role of finance within the organisation is evolving and expanding. The enterprise expects more, and at greater speed, from the finance function. To deliver this, the function must change.

One enabler of this change is the accelerating adoption of digital technologies. This impacts the speed and type of finance activities being performed. Leveraging technology to perform more of the mundane tasks allows the CFO and the finance function to spend more time planning, analysing, and advising on the growth agenda, thereby better serving the enterprise’s changing needs and expectations (see Figure 1).



Given this shift, a significant change in the skills being introduced to the finance function makes sense. CFOs know that their teams must gain insights from data and then, crucially, communicate these insights to the business.

In conjunction with the shift in the type of work performed by finance teams, the composition of the workforce is also changing with fewer people using more technology to deliver better insights (see Figure 2). 



The combination of enhanced capabilities within finance, improvements in technology enablers, and the explosion in data offers an amazing opportunity. To maximise the benefits from this digital transformation, the finance operating model must evolve (see Figure 3).

• Corporate: group-level functions, the scope of which differs from entity to entity but may include activities such as finance governance, tax strategy, treasury strategy, investor relations, internal audit, and others of a similar nature.
• Intelligent finance operations: the engine room where both transactional and non-transactional finance activities such as purchase to pay (P2P), order to cash (OTC), record to report (RTR) and significant components of management reporting take place at scale to maximise technology enablers.
• Business unit finance: direct support to the business, often in the form of finance business partnering, operational planning, and forecasting. Working closely with other teams within the finance function and the business to provide actionable insights to the business unit.
• Centre for value optimisation: instead of having static groups working on the same thing for months at a time, we see teams with multidisciplinary skills assembling for several weeks to take on short-term projects with defined goals and outcomes. Once work is completed, these teams then disband and new teams with different members tackle the next initiative. These teams are not finance-specific and will typically include non-finance partners. The work they do is supported by the data and analytics hub, where they work with experts to develop recommendations for business leadership.
• Data and analytics hub: the hub has the dual responsibility of ensuring the veracity of finance data and augmenting the teams in the centre for value optimisation with data scientists, who run multiple models to prove or disprove hypotheses. If the value optimisation squads are the ‘brains’ of the function, the data and analytics hub is the ‘heart’, pumping much-needed blood in the form of data to provide the brain with the fuel required to do its magic.

Many of our Irish clients have established the first three components of this operating model. However, they are only starting to fully investigate the potential benefits of multidisciplinary teams that use a single source of truth to identify opportunities and drive insights.

What does this mean for Chartered Accountants?

The remit of the finance function will continue to expand, and its influence will grow in the coming years. 76% of respondents claim that the pandemic highlighted the valuable role finance teams played in feeding early warning insights to the CFO. Finance will become even more critical to future success as it delivers data-driven insights and guidance at speed. However, to do this, CFOs need to consider all the capabilities within the finance team and any potential future capabilities that may be required. Here are three things to consider.

• Become more technology-savvy and data-savvy. Become technology-savvy to enable finance leaders to make informed decisions on the organisation’s technology strategy; to understand the tools that can optimise the processes in the function and allow leaders to manage teams in which these tools perform a significant portion of the activity. And become data-savvy to understand the opportunities presented by data to make informed decisions that can drive profitable growth; to understand the fundamentals of analytics to challenge the insights generated by analytics teams, if not actually being part of those teams.
• Get better at communicating financial insights to non-finance leaders. As the role expands and continues to become less about reporting prior financial performance and more about identifying future opportunities for the business, finance leaders need to convert analysis into a compelling story that business leaders can understand and act upon.
• Consider how to train and upskill the whole team. The shift to a technology-enabled, data-driven finance function is becoming even more pronounced. Trainee and newly qualified Chartered Accountants must gain enough exposure to ‘traditional’ finance activities to understand the fundamentals of finance management while working in a function where these traditional finance activities are increasingly being automated. This is a challenge that must be solved in the years ahead.

Aoife Donnelly FCA leads Accenture’s Finance Strategy & Consulting practice in Ireland.

Thady Duggan FCA is a Senior Manager in Accenture’s Finance Strategy & Consulting practice in Ireland.