Working with Genpact, the global professional services firm that makes business transformation real, The Future Laboratory has produced a new foresight report exploring how CFOs are evolving from fiscal protectors to champions of innovation and growth
Even before Covid-19 engulfed the world, the business landscape was unsettled, with geopolitical instability and a shrinking window of opportunity to prevent irreversible environmental damage. The pandemic has added its own enormous financial, health and social ramifications across industries.
Our co-founder Martin Raymond recently explored how, in response to this uncertainty, many organizations have been fretting about the New Normal, when they should be talking about the New Extra-ordinary. And as our new report outlines, when it comes to businesses harnessing the opportunity to disrupt differently and reset imaginatively, nobody is better placed than finance teams and CFOs.
Finance teams have always played a vital role in guiding their organizations through disruption. But the challenges unleashed in 2020 have meant finance teams are now leading, rather than guiding, businesses through these crises, providing agility and insight that lead to greater resilience. It’s why 29% of CEOs hired post-pandemic came directly from the CFO seat – a higher percentage than in the previous 14 months – according to Heidrick & Struggles.
From their position looking across their organizations, CFOs and finance will become champions of innovation and growth in the next decade. Finance is already blessed with sophisticated data skills and visibility of what’s happening across the enterprise – internally and externally. Combining this advantage with its deep business knowledge will enable teams to provide the insights – recommendations that help a business direct its course – that leadership teams need to make strategic decisions.
It’s a view shared by other members of the c-suite. Research from the Association of Chartered Certified Accountants and the Institute of Management Accountants reveals that 82% of CEOs believe the role of the CFO will either increase or increase significantly in importance over the next three to five years, while 68% highly value the CFO’s strategic insights.
Read on to find out more about the report, or click below to download the full report PDF.
As Prakash Hariharan, Head of Finance Transformation and Growth at Genpact, states: ‘CFOs are helping their businesses navigate uncertainty. They’re planning for different scenarios, strengthening their performance-management processes, and working toward being ready to adapt at speed. Successful businesses will have CFOs who can help them pivot.’
To get there, CFOs will spearhead collaboration within their organizations and externally with partners and even competitors to innovate or address challenges that lie beyond individual companies. They’ll use digital technologies such as the cloud and analytics to democratize access to data and insights across the businesses wherever people are. And they’ll help enforce and embed ethical values across their businesses’ entire eco-systems.
Following this line, CFOs and finance will take on all-new roles and responsibilities, from investing in new technologies and start-ups like venture capitalists – becoming ‘VCFO’s’ – to facilitating open-source innovation eco-systems shared by different companies. They could also play a central role in reshaping the skills of workforces, using their central position within businesses to address future talent gaps.
‘As leading finance teams become fortune tellers rather than historians, they have an opportunity to lead the charge on reskilling and upskilling employees to think differently,’ says Riju Vashisht, Global Transformation Services Leader at Genpact. ‘Finance can shine a light on how the rest of the organization can address talent gaps and nurture a continuous learning environment.’
The most effective CFOs and finance teams of the future will draw on the power of connected eco-systems, predictive insight, and an adaptive workforce to become agile and resilient. And the next generation of successful businesses will have shaped their finance function into a competitive differentiator. Those that don’t will be left behind.
Our foresight reports are a compelling resource that provide insights to your company internally and help you carve out a distinct viewpoint externally.
