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7 CFOs on Determining the ROI for Digital Transformations 

This era’s digital transformation has swept up all business functions, including that of finance.

That’s because — no longer confined to the traditional responsibilities of the role — today’s finance teams and their leaders are frequently charged with spearheading enterprise transformations, not just signing off on them. 

By investing in and leveraging digital tools, finance teams are helping drive enterprise evolutions while pulling key levers for sustainable business growth.

CFOs in particular possess unparalleled visibility into all the operating aspects of their organizations and are strategically positioned to play a crucial role in enterprise technology enablement and digital onboarding. 

As the pace of innovation continues to accelerate, CFOs have to stay ahead of the curve and make informed decisions that benefit their company.

With finance executives increasingly in the driver’s seat when it comes to determining a strategy for evolving outdated processes, here is what seven CFOs across various sectors have told PYMNTS about their role in leveraging innovations to stay competitive, and what an appropriate investment horizon might look like.

Read alsoNext Generation of CFOs Tackle New Challenges With Digital Solutions

The Importance of Prioritization

Before and during the pandemic, most CFOs embraced a growth-at-all-costs mindset that shifted in a “Chief Navigation Officer” role when COVID-19 disruptions led to a more challenging macro environment.

Now, the growth mindset has settled somewhat as firms look to make effective decisions that can support growth across a longer horizon. In response, CFOs have taken an active role in forming business strategies that help define what will matter right now and in the future. 

“If you go back three years, it was growth at all costs and deploy capital as fast as possible. Now, you’re still allocating capital, but you have to do so with a very strict eye on returns of that capital. Setting thresholds of what might be appropriate levels of return has become paramount,” Heather Bellini, president and CFO at InvestCloud, told PYMNTS. 

Echoing that sentiment, Ed Chandler, senior vice president and head of commercial and money movement solutions for Europe at Visa, told PYMNTS that CFOs have got a “real challenge on their hands, balancing the day-to-day working capital needs with continuing to invest in the business.” 

“As you measure growth, obviously, the growth comes a little harder now,” Marc Greenberg, CFO at Altruist, told PYMNTS. “You can’t spend money on everything, and you have to take a long-term view … it is important for finance leaders to be ruthless in their prioritization when it comes to making digital investments.” 

Fortunately, the modern CFO’s toolkit includes more than just spreadsheets and paper statements — and finance leaders are increasingly being called on to deploy all the tools they’ve got as they help their organizations strategically navigate business disruptions and unpredictability while unlocking new avenues for growth. 

“Embracing digital transformation and upgrading systems is [important] for improving the speed and agility of outcomes and helping the business continue to move fast,” Hinge Health CFO James Budge told PYMNTS. “Finance departments, if they choose to be, can be at the leading edge when it comes to embracing these new systems, new opportunities, new ways of running processes and reexploring processes that may not have been efficient in the past.” 

“I don’t know too many CFOs out there that aren’t interested in efficiencies,” Budge added.

See more: 10 Insiders on Generative AI’s Impact Across the Enterprise

A Long-Term View on Digital Investments

Despite the accelerating pace of macro cycles, one thing has remained the same: CFOs are responsible for greenlighting most investments, including digital ones. 

“Cash is best deployed, regardless of the cycle, in those investment areas where you will yield the highest return on invested capital. Where are you going to put money today that will yield value two, or three, or four and five years from now? It is a long-term measure, but that’s how you create long-term value,” Richard Rubino, CFO at VillageMD, told PYMNTS, emphasizing that when it comes to investing in innovation, “you don’t want to be two or three years behind.” 

As Vikas Mehta, CFO at Komodo Health, told PYMNTS, while “[An important] trend is leveraging new technology … the number one thing is driving through the organization that growth initiatives need to come both with a high return on investment and create sustainable value over the long-term.” 

And one key way to ensure that the whole organization is aligned on a growth initiative is by talking to other departments. 

“From a CFO perspective, we need to engage and partner with our counterparts in the organization, such as the CIO, to align around how to deploy technologies, how much to spend on technologies, what’s the pace of change around that … because there is this benefit that you may not see for the first 12, 24, 36 months, but it’s the right thing to do,” Angela Floyd, CFO at DPR Construction, told PYMNTS.