"You don’t want your balance sheet weighed down by assets,” Lesley Plaistowe, Partner Financial Services at Technology firm IBM told the CFOs that attended our Digital Transformation event on 11 September in Johannesburg. During an inspiring presentation – Digital Transformation and New Business Models – Plaistowe chatted to the finance leaders about the enormous possibilities that the latest technological solutions have to offer.
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"CFOs have some of the hardest jobs in the corporate world," Plaistowe said. With the current amount of economic uncertainty - worldwide and in South Africa - finance leaders "don't know one quarter to the next what the world will look like". At the same time technological advancement is ever accelerating: "I saw a beautiful video of a 3 year old girl playing on an iPad. When she was given a magazine she didn't know what to do and was poking it. To her a magazine is an iPad that doesn't work. That is the world we live in now."
According to the latest IBM CFO Study finance leaders now say that technological factors are the third most important external forces that will impact the enterprise over the next 3 to 5 years, just behind macro-economic factors and market factors. "In 2010 technology was only number 5 on that list and it would not surprise me if it will soon be number 2," Plaistowe said, explaining that the most successful CFOs will be the so-called 'business integrators' - people who combine business insights with finance efficiency.
What can you do as a CFO? "We all know the cloud, but we're afraid it's possibly not secure," Plaistowe admitted. She then talked about the solutions that are currently in the market. In most cases cloud-based solutions are actually much safer than companies running their own data centers, she revealed. "The first results of our research shows that companies that go with cloud have 30 percent lower cost of ownership. I expected that to be a lot higher, but many companies are still phasing out legacy systems. That also means more benefits lie ahead."
In the ensuing panel discussion Aarti Takoordeen (CFO of JSE Limited) and Mthoko Mncwabe (CIO at Postbank) argued that companies should ready their processes first, before thinking about moving into the cloud. "First you need to ask yourself: are your businesses processes, your people and your mindset mature enough," said Takoordeen and Mncwabe added: "First you need to fix your business model, then improve your customer experience and processes."
"It is good to know we're not alone," said August van Heerden, CFO Retail and Business Banking Barclays Africa. Just like most panelists he felt Plaistowe's presentation was spot on, but going into the cloud brings a lot of practical issues and professional anxiety to the fore. "Who is going to switch off legacy systems? We're too scared to do it! And there is another conundrum: should we invest in branches we might not need in 10 years' time?"
