Q&A: Connected CFOs take centre stage
How has Advanced transformed in recent years and what role has the finance function played?
The business has undergone a period of significant transformation under the ownership of Vista Equity Partners (Vista), a private equity firm, acquiring seven businesses in the last 24 months and transforming the original business from 13 federated units into one cohesive organisation. We’ve also delivered 20 per cent year-on-year EBITDA growth. To support this rapid rate of change, the CFO role at Advanced has evolved and innovated significantly. By consolidating and simplifying the business’s structure and creating consistency of management information across the organisation, the finance function at Advanced has taken the lead in generating more insight and challenging performance. This in turn has enabled finance to take a far more strategic role and facilitated quicker decision-making across the organisation.
What have you learnt during this transformation about the evolution of the CFO role?
Technology has meant the role of the CFO has taken on new dimensions, requiring new skills and capabilities. A CFO that isn’t now “connected” will lag behind the competition. Tracking performance and predicting threats and opportunities based on performance metrics have become a top priority. CFOs need to be technology savvy to reduce the amount of time they and their team spend on repetitive financial processes, the production of financial information and cost control. Eradicating mundane transactional processing can release valuable resources to focus on strategic business priorities. Earlier this year, we acquired three companies within three months. The role of finance was fundamental to this, not only in ensuring the numbers and performance stacked up, but in providing fast access to meaningful insights and the ability to interrogate that information. The connected CFO uses the latest innovations to ensure the organisation is lean, flexible and competitive.
Which new technologies, in particular, are enabling CFOs to broaden their influence in the business?
Traditional finance functions can be automated with technologies such as workflow management and more lately robotic process automation. Innovative cloud-based systems also provide integrated and consistent access to data from across the organisation, and ensure CFOs can bring meaningful insights to the board, departments and stakeholders. A key part of our transformation was ensuring our business could operate on centralised systems which were integrated (finance, customer relationship management, resource management, reporting and analytics, and so on). This is what sets the connected CFO apart from the increasingly outdated tactical CFO. Real-time, integrated operational key performance indicator models, both the right measures and using the right technology, ensure connected CFOs know immediately how to adapt.
The digital era offers great opportunities to forward-thinking finance leaders
What is your advice to CFOs on how they can elevate the finance function?
To do this and really take on a new connected role, CFOs require insights on business performance across the organisation. They need to change financial structures to meet business pressures, without increasing admin and reporting costs, and be able to budget and forecast accurately. Operational and strategic reporting should be driven from one single, cloud-based platform. CFOs must be able to translate complex financial data from multiple sources into consumable information to help navigate changing economies and markets, as well as minimise risk. They are expected to be business enablers, putting finance at the heart of the performance agenda. To deliver they need access to software that not only collates, stores and processes all this data, but also helps them turn it into meaningful information, providing a link between financial numbers and the key operating metrics of the company.
What does the CFO of the future look like?
The best CFOs will be able to anticipate future needs, enabling the use of non-financial data for reporting and predicting potential future requirements, and ensuring the organisation is agile enough to respond. Ultimately, CFOs must act as a strategic business partner to the chief executive on the frontline of the business. It’s becoming increasingly clear that CFOs need to embrace software that streamlines this process and allows finance modelling. The digital era offers great opportunities to forward-thinking finance leaders, putting them in the powerful position of providing the rest of the company with meaningful and insightful data analysis.
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