Digital Finance Imperative For CFOs
Leading CFOs who provide the tools and the acumen to architect business outcomes that generate value, are embracing the digital imperative. While some CFOs resist the digital finance imperative, CEOs have a responsibility to ensure Finance dusts off any antiquated ways of working that are becoming distant memories inside progressive organisations.
In a bid to answer the question, “where is the finance function going in the digital age?”, Accenture undertook this study that suggests, cross-functional integrated teams will deliver 80% of traditional finance services. It also predicted that Finance-staff productivity will increase by two to three times, while the finance organisation’s costs will be slashed by 40%.
David Axson, managing director of Accenture’s Strategy, CFO & Enterprise Value practice, delivered a hard-hitting message to the CFO community by stating; “Say goodbye to today’s process-focused finance model. Digital technologies are blowing it up”. He also declared; “it will be the best thing that ever happened to your finance organisation”.
Read David's full article: Death by Digital: Good-Bye to Finance as You Know It
Finance Must Modernise
CFOs and their finance teams are being asked to help define and implement new, digitally-enabled business models, and must expand their existing competencies with in-depth knowledge of technology and analytics, as well as broader leadership and business partnering skills. Traditional performance metrics no longer capture the value being created by intangibles, which calls for CFOs to create new metrics to measure and monitor these value drivers.
“Five years from now, I expect that a big differentiator separating highly successful CFOs from others will be the ability to operationalise and execute company strategy based on data-driven insights“.
– Frank Friedman – CFO and COO of Deloitte LLP (read more)
Measuring the Intangibles
Intangible assets such as brands, customer relationships, intellectual property and human capital have become significant value drivers in business. But traditional Finance metrics are not cut out to measure these.
Leading Finance executives suggest the need to identify new KPIs to accommodate the intangibles. This is particularly important when considering the fact that (as illustrated above) on the S&P 500, intangibles now comprise 84% of corporate valuations. These new KPIs can then help transformation leaders understand how to measure the potential intangible outcomes of digital business transformation.
Download research conducted by CIMA and AICPA
The Digital Finance Imperative: Measure and Manage What matters Next
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