CFO's Dual Responsibilities in the Digital Context
As facilitators, CFOs need to assess and approve digital investments. For this, they must ask the right questions, and critically evaluate the business cases to make informed decisions. Computing the return on investments (RoI) is not enough; CFOs also need to take into account the impact of projects relating to disruptive technologies on the organization's cash flows, profit and loss (P&L) statements, tax liabilities, and so on. More importantly, CFOs should be aware of the potential impact of digital changes on the business models, products, and services of their enterprise customers, to be able to assess changes in their financing needs. This will ultimately drive the financial firm to modify its offerings to stay market relevant and competitive.
In addition, CFOs also need to appreciate the cascading effect and interplay of digital technologies, and how the organizational finance function can leverage this aspect to reap maximum benefits. For instance, the confluence of mobility, social media, and analytics can result in powerful solutions to streamline the daily operations of a finance team.
Finally, CFOs should be aware of the risks associated with the use of digital technologies, such as data security concerns, instances of reputational damage (due to the potential negative impact social media can have), and so on. This necessitates the institutionalization of sophisticated governance mechanisms.Download this pdf to know more about the digital technology benefits that CFO can leverage to improve efficiencies and effectiveness of the enterprise finance function at different levels.
Download this pdf to know more about the digital technology benefits that CFO can leverage to improve efficiencies and effectiveness of the enterprise finance function at different levels.