The business landscape continues to evolve through unprecedented times of uncertainty: a possible recession, a 53-year low unemployment rate, and increasingly limited resources. Organizations of all sizes and across all industries are focused on innovating to meet customer and employee expectations in an unstable economy.
As businesses pivot to embrace innovation, CFOs are asked to decipher chaos, provide deep analysis of business and market trends, and cultivate creative solutions for business growth. They have become the lifeline for sustainable success.
But beyond their ability to oversee finances and their relationships with the board, CEO, and C-suite, CFOs have the capacity to assess and measure an organization strategically. That is a key asset in innovation.
Business growth often includes developing new products, services, and/or experiences, as well as exploring new ways to serve clients and disrupt business models. It also hinges upon well-defined processes, evolving value propositions, elevating talent into new roles, and discipline.
With the CFO’s strategic outlook, managerial abilities, and financial skills and training, there are five traits that make the CFO an ideal leader in business innovation.
Because CFOs view the organization in its entirety, they can champion innovation that is both brand-compatible and financially feasible, even if some risk is involved. Leading in a multidimensional role as operator, catalyst, strategist, and steward, the CFO has a unique perspective on technology’s role in innovation to drive business results. When it comes to deciphering data into actionable information for business decisions, the CFO is at the forefront serving as a liaison between technologists and key decision-makers.
As an objective leader who navigates competing interests by presenting facts, analysis, and solutions that weigh both the costs and benefits of any decision, the finance chief has moved from the back office to the front office as a continuous leader in digital innovation, driving business intelligence to reimagine outcomes.
No one in the organization has a perspective like the CFO. In addition to seeing the organization as a whole, the CFO has a unique view of each department and how they perform as individual revenue generators. The CFO monitors business trends over time with the ability to both identify and act on warning signs of stalled or slowing progress, responding with fresh perspectives and approaches to growth.
In this role, the CFO leverages invaluable information to fuel marketing, sales, operations, human resources, and technology teams with data for decision-making and problem-solving for client and business solutions. This also helps break down departmental silos to promote greater cross-functional collaboration, which has become a key operational priority for companies.
According to McKinsey, “the hallmark of innovative companies that people admire is innovating year after year in different parts of their product or service portfolios.” Continual innovation may well require periodic reallocation of resources —people, time, tools — to develop the ideas that hold promise. Using budgeting and forecasting tools, the CFO can help make these shifts efficiently, with minimal disruption to the organization. As the finance North Star, the CFO aligns business strategy with HR strategy to help guide successful investments in human capital. The CFO analyzes churn rates as well as talent acquisition, development, and retention programs that are critical to long-term success. Having the discipline to evaluate the ROI of HR decision-making, the CFO can move fast when warranted and pump the breaks when needed.
Holding the metaphorical purse strings gives the CFO the leverage to set growth targets for the organization that, regardless of what they are, can be met by innovating. The CFO can help direct the impetus to develop new processes, create new customer experiences, refine or expand product assortments, and so on.
But, the CFO’s role has become increasingly multi-dimensional. More and more, the CFO is a driver of company culture, morale, and purpose. Financial transparency, integrity, analysis, and strategy are top priorities for many organizations, and without talented people, those don’t exist.
Great CFOs know that recruiting and retention are no longer solely the responsibility of Human Resources. Innovative CFOs recognize that the job market is tight and are stepping in as leaders, role models, coaches, and trainers who value employee interests, talents, contributions, goals, and satisfaction. In providing the support and justification for both good business decisions and hiring and retention practices, CFOs bring organization and innovation to company culture.
CFOs have the clout to effect a “change of mindset,” as Forbes describes it. Being in the highest echelon of the C-suite gives CFOs the opportunity to change the stereotypical way they may be perceived — as the one who nixes — to part of the team that strives for fixes. Recalibrating how department leaders and staff are invited to interact with the CFO can be a potent cultural shift that results in productive collaboration on innovation. As a trusted collaborator and communicator using real-time analytics to anticipate markets, build roadmaps, and impact company policy, the CFO is a strategic storyteller with the power to unlock future growth and business success.
Today’s business climate is mercurial, and such an unpredictable environment is the optimal time for CFOs to be innovation leaders: They have the strongest grasp of what new technologies and talents might be needed to ensure the organization can sustain a leadership role in innovation. They bring together better teams to supercharge sales, boost marketing effectiveness, and leverage technological advancements. Amidst constant disruption and ongoing uncertainty, CFOs are the innovation leaders reimagining business.
Is your organization seeking a CFO, senior-level management, or other accounting or financial reporting support? Alliance Resource Group can provide premier talent that creates lasting value for your company.