The contemporary business landscape moves fast, which means finance teams need to move faster.
“The level of change that is now part of our day-to-day lives is much more than what it has been in the past,” Sameer Katiyar, chief financial officer (CFO) at Cleo, tells PYMNTS for the series “A Day in the Life of a CFO.”
“It’s necessitating not just the finance team, but the entire business across all areas to be nimbler, to adapt quicker, and to be more responsive in order to ensure that the business continues to operate profitably and achieve key goals,” Katiyar added.
The rate of change and the unpredictability of events have significantly increased in the past few years, and CFOs are now dealing with an environment that demands adaptability — this means that the traditional responsibilities of the role are in turn expanding.
It is no longer sufficient for CFOs to focus solely on financial matters; they must actively engage with the broader business landscape.
“The CFO needs to be more plugged into the core business, and there’s an increasing requirement to understand what is happening as far as the product is concerned, what is impacting the customer base, and, lastly, the financial systems need to be able to provide and process the right information so that departmental leaders can connect the dots and make informed decisions,” Katiyar said.
While the environment has evolved, the core responsibilities of a CFO have remained consistent and centered around a strong foundation in finance.
The basics of finance management, reporting, and efficiency of financial operations continue to be at the heart of the CFO role.
Particularly as the macro environment transitions from a landscape of growth-at-all-costs toward one where growth needs to be tempered by right-now profitability, a deep understanding of the balance sheet, financial operations, and compliance are as crucial as ever.
“The biggest change is how you utilize the technology to be more nimble and be able to then support the business leaders to take the decisions,” explained Katiyar.
“Before you can focus on the outside, you need to be in control of what’s happening internally,” he said.
However, today’s CFOs must also embrace technology and innovation to enhance their decision-making capabilities. They need to integrate various digital tools and payment solutions into the company’s financial operations. Additionally, they must focus on data management, ensuring that all data is readily available, clean, and used for informed decision-making.
“It is people, process and tools,” Katiyar said, emphasizing that those are the three keys to success in any role. “You’ve got to focus on your people, you’ve got to ensure the appropriate processes are in place, and you need to be sure you are using the right tools.”
The digital transformation wave has touched every aspect of business, and finance is no exception. Digital solutions, including cloud computing, artificial intelligence (AI) and automation, have become integral to the finance function. CFOs must not only understand these technologies but also integrate them into their financial operations.
“Whereas previously strategic planning could be set for a year, or two years, now it is either a monthly or a rolling forecast,” Katiyar said.
These technologies can enhance the efficiency of financial operations and improve decision-making processes, and their integration requires close collaboration with other senior leaders.
As businesses continue to evolve and technology advances, the role of the CFO will become more tech-focused.
“What has changed over time is the increasing need to bring digital tools together to provide insights on a holistic and comprehensive basis, rather than looking in silos,” said Katiyar. “Ultimately, the goal is for things to evolve where all the data is available in one place, and the data itself is fundamentally clean and noise free — which is easier said than done.”
And while the future CFO of tomorrow will be a leader who can seamlessly integrate technology into financial operations and decision-making processes, Katiyar highlighted that no matter the business landscape transformations, having the right people will always be critical to the success of any organization.
While technology and data are essential, the right people, their retention, and their continuous development are paramount, he said, because people are the driving force behind innovation, adaptability and success.