Four crucial changes every CFO should be making right now
Oracle director and CIMA deputy president Nick Jackson says CFOs need to be the face of change.
Recent weeks and months have likely been the biggest challenge in most CFOs’ careers. With almost no warning, millions of businesses – indiscriminate of size or stature – suddenly went from operating as usual to facing enormous challenges under the weight of uncertainty.
Faced with unparalleled adversity, CFOs have to become the steward of the business’ future. When global uncertainty is coupled with increased scrutiny from the CEO, board, investors, employees, and customers, every move they make is critical.
With these challenges to meet and tough decisions to make, the CFO is at the centre of a rapidly changing economy.
The major challenges
There are four areas where the CFO will be crucial: managing cashflow, investing in the supply chain, working closely with HR, and focusing on customers. We’ll explore how CFOs can tackle these challenges head-on, make important changes where it’s needed, and be a confident steward through crisis.
The most immediate challenge faced has been managing cashflow. Many businesses, whilst inherently profitable, found themselves struggling to make ends meet with insufficient working capital readily to stay solvent. This lack of economic resilience does require short-term cuts, but it also relies on intelligent decisions that will keep the business healthy in the long-term. Read more here.
The next focus area is supply chain. For decades ‘lean’ has been the name of the game. But lean, just-in-time supply chains have struggled in the face of global crisis. To get back on track and plan ahead, spending big to ensure supply chains are robust and resilient, not lean, will be critical. Read more here.
Balancing cost-cutting with ensuring the business can still function effectively is vital, especially when your biggest asset – talent – is also your biggest expense. To walk this fine line and ensure every decision made helps safeguard business continuity and survival, the CFO should work closer than ever with HR. Together, they can master their business’ data to see where skills and resources are needed most in the here and now, while planning for whatever the future may bring. Read more here.
A people-driven approach is vitally important, and not just when it comes to staff and employees, but also customers. Delivering good customer experience is one thing, but right now, CFOs and finance teams getting closer than ever to their customers – and indeed their suppliers – is what will set you apart. Showing you can balance their needs with those of the business’ proves that you are the partner they can trust to guide them through uncertain times, now and in the future. Read more here.
No more status quo
The CFO is responsible for more than the purse strings and getting the numbers back on track. Being the dependable steward of the business is no longer about maintaining the status quo. It’s also about being determined to drive change where it matters most. They have to set the standard for the CEO and the board – changing the way their business is run, how it picks itself back up, and knowing what it will take to move forward. This will take resilience, long-term thinking, and empathy.
Businesses without the determination to change focus from shareholder to stakeholder won’t fulfil their purpose: to deliver for customers, sustain profitability, and succeed. Businesses who set the bar high now and prosper long term will have one thing in common: CFOs who are the face of change, acting as the leaders they need to be.