Given that CFOs sit at the heart of the operating committee and are often keepers of the strategic planning process and financials, they’re uniquely positioned to enable their business’s digital transformation.
So, any effective CFO needs to be clear on what digitisation will be productive, disruptive, revenue-building or value-creating for their business. But what about keeping the business safe and secure, overcoming organisational and structural roadblocks, while concurrently innovating and reducing costs? In this blog, we take a look at how CFOs can shape digital transformation whilst mitigating cybersecurity risks.
Understanding key technologies: live and breathe digital.
Digital transformation is evolving apace as industries move from digitising business processes to data capture, analytics, Robotic Process Automation (RPA) and AI. Throughout this unprecedented period of adaptation, CFOs must focus on what’s right for the business they steward and how best they can harness value through digital transformation. Firstly, this is achieved by making sure that the corporate strategy and digital analytics strategy are the same thing. By embracing and understanding key technologies the CFO is uniquely placed to incorporate digital analytics into the corporate strategy.
You’ve started to walk, now let’s get running and streamlining processes.
Next, look at your business’s processes. Where will the digital analytics revenue be coming from now and in three to five years? What’s on the horizon that’ll disrupt your industry? You should be able to cut costs and drive efficiency by saving your team’s time through the right digitisation programs and training. Beyond that, you’ll acquire and retain more customers through better data capture, increased transparency, and better customer service. Increased digitisation should lead to enhanced tracking capabilities and data capture. This data can be used to identify tasks suitable for Robotic Process Automation (RPA) and to train AI systems to inform and guide business strategy
This all seems great on paper but…what are the roadblocks?
1. Poor resource allocation
Michael Bender, a senior partner at McKinsey, says that poor resource allocation can be one of the major reasons why digital transformation fails. Companies that overinvest in reinventing their core business or creating new business models or fail to strike the right balance between digitisation and analytics, are unlikely to fully benefit from new technologies. Therefore, the CFO needs a clear plan outlining which technologies to use, why, and how to apply them to generate value and revenue.
2. Legacy technology
A lot of businesses are held back by legacy technology and struggle to effectively integrate old systems with new ones. Here, the CFO needs to collaborate with the CISO and technology experts to find out what’s possible with the systems you have in place or what a transition away from those old systems might look like. But don’t be put off by AI in thinking that it’s not compatible with your business. Interestingly, legacy systems might become less of an obstacle with the use of AI, as it allows for training, prototyping, and enhancement alongside older systems.
3. The wrong people to build and execute
Building the right team is essential. You need both tech-savvy leaders and business-savvy technologists. As the business becomes more centred around data, think about hiring data scientists, engineers, architects, customer experience specialists, and cyber security and AI experts. In terms of execution, you need to make sure that silos are broken down, knowledge sharing is company-wide, and everything ties into the business’s strategic objectives. The right CFO is instrumental in terms of spotting value creation for the company and working with the team to execute the ongoing transformation.
4. Keeping the business secure
How do you integrate business security into the innovation pipeline? Maintaining a balance between business security, timely delivery, and quality engineering is crucial. Building secure test environments requires a strong foundation of trust in the established workflows to ensure both high productivity and successful innovation.
The CFO, with the right mindset, knowledge, and team, can be a key driver of significant value capture through digital transformation. CFOs v can now play an even greater pivotal role in driving meaningful change within their organisations by applying their financial acumen and adapting to new technologies that benefit their business
At The Siena Partnership, we work with our clients to recruit top finance professionals who can guide their organisations through complex economic challenges. If you’d like to continue the conversation with our finance expert, Mike Faull, contact us here: mike@thesienapartnership.com