The Mars South Africa CFO believes that CFOs need to be much more agile in the new world of work.
Covid-19 has changed the way we do business considerably. One of the most significant impacts of the pandemic has been on the role of the CFO. Sam Hopwood says he has had to pivot as a CFO to make sure that Mars South Africa had what it needed to step up during this time of crisis.
Sam explains that there are three main pillars to the CFO role. The first pillar, and undoubtedly the most crucial, is being the custodian of the business.
The second pillar is being a solid business partner to the leadership team, particularly the general manager or CEO. “We need to make sure that we’re steering the business in line with the strategic intent,” he says. “What it means to me personally is that I want to enable the best decision-making as possible for the business.”
The final pillar is that you need to be a leader of the business. “There’s a much broader role to play than simply within the finance function that’s around enabling growth and development throughout the organisation,” he adds.
Playing on a new pitch
However, during Covid-19, these pillars have slightly shifted. “If I were to use a sports metaphor: we’re playing the same game, but the pitch has slightly changed,” Sam says. “There are new risks and challenges that we are facing now that we didn’t before.”
He explains that the level of ambiguity has shifted massively for many businesses. “Many businesses can manage within a 10 percent variance of their demand, purchases or stock levels,” Sam says. “But what’s happening now is that, in scenario planning, we’re seeing variants of 50 percent, which means that we can’t do what we’ve always done when it comes to scenario planning and risk management.”
He adds that, in the previous ways of working, CFOs would have created data models and tried to get as much accuracy as possible. However, with the onset of Covid-19, CFOs now need to be much more agile and act with a lot more speed when it comes to scenario planning.
“Part of our personality as finance professionals and accountants is that we need to be 100 percent accurate,” he says. “Unfortunately, that’s not possible now. We need to get more speed in our decision-making and analysis, rather than trying to be perfect.”
The CFO of the future
Sam believes that CFOs are no longer just functional leaders, but business leaders. “The CFO is one of the roles that has the highest level of visibility and perspective in the organisation,” he says. “So the focus area becomes more than just the custodianship of the P&L, the balance sheet and the working capital, and moves towards the business performance and the KPIs that match.”
From a skills perspective, Sam believes the focus has already been shifting over the last couple of years and that, in the future, we’re not going to need more accountants. “We’re going to need more digital-literate analysts – people who can work with high levels of data and ambiguity, and work with speed to deliver insights that enable better decision-making in the organisation,” he says.
You can find out more about how Sam and MTN South Africa CFO Dineo Molefe have had to pivot as CFOs during Covid-19 in the latest CFO South Africa podcast, sponsored by Sage.
