September 2019 |

Last Thursday, I chaired a conference of 250 of the UK’s leading CFOs for the World Finance Forum 2019 and here is some key themes explored by the CFOs in their discussions, and the implications:

Robotic software and automation is coming down the line with impact on the shape of the function, but…

Some people are beginning to experiment with using it to improve some elements such as month end report production, and it is an area of interest.  However, as Chair when I asked one of the speakers whether they were ready to fire 75% of the team, this elicited surprise from both the speaker and from the audience.  This left me pondering how far many finance (I write this as an accountant myself) professionals have got their heads around the implications of what is coming.

There is recognition that the function needs to recruit very different people to be business partners going forward but

There was quite broad consensus that people who can perform more value adding activities will be needed and they will have characteristics such as curiosity and appetite for innovation. This was one of the most exciting elements of the conference as it is a key element to the continued journey of finance to be a value adding function.  However, there was little consensus where these new people would come from, how to change the recruitment process to find them and how finance could appeal to candidates when other departments would want the same characteristics.

PS. Interestingly there was a view amongst a number of CFOs that the need for numeracy would decline.

The ERP platforms might just be about to match their promise of 30 years ago to bring visibility to historic data, however….

Many large corporates are still running multiple ERP platforms and / or are having to use intermediate tools to bring visibility to the data held, and they are struggling. However, I certainly felt that the mood was changing towards the possibility that the better automation might open up the point where the data was good enough to not only give good insights into historic activity but start to enable better budgeting and planning; we are not there yet but it is improving. Promise might meet reality after all!!

(As a detour, I had several conversations with some experienced CFOs who were open about the ‘optimism verging on naivety’ of many business cases which had underpinned ERP implementations and that the poor implementation of many ERP platforms was a reputational impairment on finance over the last decade and a half. Probably a whole conference in its own right)

However, too many functions are not on top of their data…

I did not think I would be writing this in 2019 but there continues to be a problem with data integrity and accuracy. Too many speakers referred to the subject and too ‘rubbish in, rubbish out’ to affirming nods. Whatever the genesis, in 2019 that this remains a problem holding back a material proportion of functions suggests that 40 years into a computing revolution, there is a fundamental problem both impacting doing the day job and I wonder what the reputational impact (again) is?  Whether because credibility is impaired, this holds back some finance functions from achieving their more sophisticated aspirations for value adding is another important question.

‘Transformation’ is in vogue, but…why is it needed so frequently and where does it end?

Transformation was definitely the most used word of the moment.  I think it is a powerful mantra upon which to hang change programme. However, two questions were left unanswered.  First, why do so many functions need ‘transforming’? It remains unclear why the inheritance of many incoming CFOs who have launched such programmes was not good enough. I wonder whether in reality that permanent transformation is what is going to be the order of the day?

In essence, the discussions were a combination of forward looking and really quite revolutionary, mixed with dealing with some deep dark secrets as to the state of data and ERP. Inevitably this might merely reflect the conference and the attendees, but it suggests that there is a substantial bifurcation occurring. There are those who have their house in order and are beginning to be able to leap forward with the tech through automation, and can grapple with sophisticated business partnering as a corollary.  Alternatively, there a significant group who have yet to get the basics right and are in danger of being left behind.

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