As COVID-19 continues to challenge and disrupt the business landscape, CFOs are stepping up and playing a bigger role in digital transformation. In fact, many of them are driving the digital strategy within their businesses – and we have new insights into how they’re achieving this, writes Pieter Bensch, Executive Vice-President, Africa & Middle East at Sage.
I spoke about the new challenges brought on by COVID-19 at the recent CFO Africa 2020 virtual event and how CFOs and other senior financial decision-makers are navigating this new landscape using tech.
Sage’s CFO 3.0 research revealed what Arthur Goldstuck, CEO of research firm World Wide Worx, describes as “the single biggest shift in the role of financial decision-making in the past decade”.
Conducted during the South Africa lockdown, our research reveals that digital transformation now tops the C-Suite agenda. With new challenges around remote working, governance, and a larger attack surface, the digital strategy is no longer just the responsibility of the CIO or CTO.
Pre- and post-pandemic challenges
Encouragingly, South African CFOs are taking these new challenges in their stride and have stepped up to drive the digital strategy. In fact, our research showed that 15% of CFOs now have complete ownership of digital transformation within their businesses.
Before COVID-19, the biggest challenge facing CFOs was how to support the business strategy while complying with ever-evolving finance legislation. This was already a significant shift in the role of the CFO, whose responsibilities were moving away from number-crunching and reporting.
Today, nearly a third (27%) of senior financial decision-makers have taken on the responsibility of remote worker management since lockdown began. Plus, they have the added challenge of ensuring compliance across a decentralised network, a scattered workforce, and a larger attack surface. All the trends that were at play before the pandemic have been accelerated, with cybersecurity and data protection rising to the top of the challenge pile.
And yet South African businesses have shown impressive resilience in a time of massive disruption – especially those that were already using cloud-based business management solutions to support the finance function.
Of the nine in 10 senior financial decision-makers who used technology to better manage changing customer and industry demands before COVID-19, 44% reported moderate to strong growth in organisational performance over the past year. That’s right. These businesses grew despite – or in spite of – the recession. Here’s how they did it.
Tackling challenges head-on with tech
As the custodians of data, CFOs are increasingly looking to emerging technology to decrease risk, enable real-time decision-making, and help them to build a finance function that can withstand future challenges.
Our research revealed a broad range of challenges facing finance professionals in the country, including:
- Changing stakeholder needs (57%),
- Managing fraud and cybersecurity risk (50%),
- Modernising business processes with tech (50%),
- Managing team productivity remotely (47%), and
- Staying informed on changing regulatory requirements (43%).
Yet CFOs are nearly unanimous in agreeing that next-generation financial management solutions that incorporate emerging technology have been critical to their success. Most CFOs cited direct productivity benefits, like automated compliance reporting and the ability to make real-time decisions around risks and opportunities.
What’s more, they’re confident that predictive-based technologies will change the way they operate at board level. Two-thirds of CFOs expect emerging technology to audit results continuously and to automate period-end reporting and corporate audits, reducing time to close in the process. And more than half believe that emerging technology will continue to support them in their roles and allow them to keep a finger on the pulse of their business.
Technology is taking finance in a new direction and our research shows that senior financial decision-makers are going along for the ride – and enjoying it.