IBM’s new Global CFO Study finds that CFOs are in a position to make big changes in their companies. Technological innovation, understanding of data and risk, and broad opportunities to influence company decisions put CFOs into the driver’s seat in achieving strategic outcomes.
The study states that CFOs should be “both guardians of stability and agents of transformation. At the epicenter of strategy development and execution, CFOs, working hand in glove with tech leaders, supercharge technology as the transformative force in their organization.” More than six in 10 CFOs said they need to rewrite their organizational playbook, bringing new strategies to the fore and taking advantage of technology. CFOs ranked modernizing technology as the most important driver of competitive advantage over the next few years, with many eyes on using AI to make standard calculations more efficient and make more effective predictions.
Some high-performing CFOs are taking advantage of all that is in front of them and playing a key role in strategy, the study found. However, several CFOs could do more to accelerate their influence, and they seem to be more hesitant to push for major changes. The report reviews what CFOs can do to be better and more effective change agents. Many have to do with data and AI: Work closely with your CIO on tech priorities. Upgrade data management so the information is more useful with AI systems. Use that data to transform strategic principles into measurable metrics. Learn your company’s risk tolerance and make calculated bets. Look for ROI, but be sure you’re investing in both short-term and long-term payoffs. And make sure your team is trained in areas including data security, data curation and sustainability.
These strategies are not all easy to employ, especially given finance departments have generally had set policies and procedures for decades. However, IBM’s study shows that there can be rewards for CFOs who take a position more central to company strategy. Leading CFOs tend to outperform their peers in finances—returning 39.3% more revenue growth and 10.6% more revenue growth last year—and with retention, strategy, brand reputation and tech maturity.
How, exactly, can technology help your finance department? Jeff Bronaugh, a partner in financial advisory firm CrossCountry Consulting’s national business transformation practice, explained some of the ways to start using it, and provided some advice on implementation. An excerpt from our conversation is later in this newsletter.
Forbes is compiling its first-ever list of best-in-state CPAs, and nominations are now open. You can find all the details and submit a nomination here.
Federal Reserve headquarters in Washington, D.C.
Today’s the day that countless economists, financial professionals, executives and investors have had circled in red on their calendars for more than a month: The beginning of the Federal Reserve Board meeting at which interest rates are going to be cut. The announcement will come Wednesday afternoon when the two-day meeting concludes, but it’s an understatement to say their decision is anxiously anticipated.
Interest rates have been at a 23-year high of 5.25% to 5.5% since July 2023, and economists are currently wondering........© Forbes