If you’re a CFO preparing to lead your company into digitization, no transformation is more important than making customers' experience with your organization better, Ash Noah, managing director at the Association of International Certified Professional Accountants and veteran CFO, told CFO Dive Monday.
Over his career, Noah's come to understand how technology disrupts traditional business. “Not just the digitization of finance, but the digitization of the whole business model fundamentally drives the change,” he said.
He outlined the four steps CFOs can take to ensure the digital transformation they lead creates value rather than simply cuts costs:
Examine business model to understand what you’re providing to the customer
Any transformation that doesn’t keep the customer at the center is a wasted exercise. Ultimately, you will digitize your processes, but be clear on intent. It must be about transforming your customer experience, the way the customer does business with you, and consumes your product or services with the latest tech.
Finance transformation on its own won't produce impact, results or value if you’re not fundamentally changing your customer experience. You might automate, and you might make back office processes better, but if it doesn’t involve customers quickly getting information at their fingertips and finding your company easier to deal with, then it’s cost reduction, not value creating.
Examine finance, accounting and legacy processes
Upon examination, re-engineer them to fit the business model. Don't adapt technology to your processes, which does not add value. Rather, change your legacy processes so you can leverage the power of new tech. Those CFOs and organizations that adopt the tech and implement it are far more successful than those who adapt it.
Right people, right skills
Use the right people, with the right skills, to understand tech and data, so they can analyze it and provide insights. A CFO must have all of these skills. You don't need to make your finance people data engineers or scientists, but they need to understand and leverage data science within your function so you’re taking the maximum advantage and leveraging the new capabilities. What finance needs to know is the art of the possible. If you don't understand the breadth of the available new tech, you can't leverage the power new tech can provide.
Collaborate across groups
Build your capabilities around human skills by creating a function that’s able to collaborate with the rest of business, operate cross-functionally, and understand the needs of other parts of the business. Be able to influence, impact and change behavior based on clearly communicated insights.
The CFO and the office of the CFO are both positioned to look across the business from the front seat, Noah said. They know, because of their involvement in numbers and reporting, that they understand the cross-functional impact. They should be driving that enterprise-wide transformation from that vantage point.
To do that, you need people with those human skill sets around collaboration, being able to problem solve, and think critically. These skills, widely talked about in the finance profession, are critical in today’s environment.
“These are the four essential building blocks to successfully transform your enterprise,” Noah says, “and how finance can play a pivotal role in driving that transformation.”