2 items tagged "CFO"

  • How the need for data contributes to the evolution of the CFO role

    How the need for data contributes to the evolution of the CFO role

    The role of the CFO has evolved in recent years from the person in control of the purse strings, to the trusted right hand of the CEO.

    Their importance was further enhanced during the pandemic as they were often required to oversee changes in a matter of days or even hours that would normally have taken months or years to bring to fruition. They are no longer just the person in charge of the money, but a strategic planner whose insights and counsel inform some of the company’s biggest business decisions.

    But although their role has evolved, the technology which helps them is still playing catch-up, with the lack of reliable analytics and data one of the biggest hurdles to progress.

    A changing role and the need for data

    The finance function has traditionally been known for its stability and process-based culture. But Covid brought about a need for quick-fire decisions, where the rule book had to be re-written overnight or thrown out completely. Data has always been central to agile business planning, forecasting and analysis – all tools which have become central to the modern CFO role. The pandemic sped up the need for this type of tech, yet many firms still lack these insights to do the job properly. 

    This level of data collection and insight requires the right technology. But in a survey of CFOs by Ernst and Young, eight out of 10 respondents said legacy technology and system complexity was one of their top three inhibitors to progress. 

    Data that tells ‘one truth’

    Companies are awash with information, each different department has their own KPIs and methods of reporting. But what CFOs really need if they are to perform their modern role well is not just data, but to be able to connect the dots and gain an holistic view.

    They need integrated financial insights on accounting and finances data, better traceability and operational reporting on things such as customer segmentation, products and revenue assurance.

    To enable this, Teradata’s multi-cloud software integrates data fast across finance systems – such as Oracle, PeopleSoft, and SAP – to connect and  integrate in near real-time. It also has a pre-built financial data model that’s ready to receive and structure data to enable controlled, user-friendly access. This all helps reconcile data from a wide variety of different sources into a trusted, compliant platform.

    Turning insights into action

    Just one example of how this level of data insight has helped a firm was when a global retail company needed to modernize their analytics ecosystem. Their processes were manual and time consuming. Their spreadsheet-based model results couldn’t feed downstream models and analytics.

    Crucially, a lack of trust in the model also meant analytics results had limited use to the business. The company worked with Teradata to create a finance-driven data foundational model. It provided in depth detail into things like revenue and costs from aggregate views of branches, products, vendors and customers.

    This information enabled the financial justification for strategic business decisions. It’s this level of detail that can continue to enable CFOs to retain their position of trusted advisor to the CEO and an indispensable asset to the company.

    Source: CIO

  • Why being sustainable as an organization is a key concern for CFOs

    Why being sustainable as an organization is a key concern for CFOs

    In recent years, corporate sustainability efforts have become an important and unavoidable concern for finance executives. Jon Chorley has seen this trajectory from a unique vantage point, holding dual positions as Oracle’s chief sustainability officer and vice president of product strategy for supply chain and manufacturing.

    As the guest on Oracle’s General Ledger podcast, Chorley talked with Kimberly Ellison-Taylor, CEO of KET Solutions, about how his two (seemingly diverse) interests have become inextricably linked in the modern business landscape.

    “I personally find that a tremendous confluence of factors. A lot of things that affect sustainability also impact supply chains, and vice versa,” Chorley says. “There's no question, it's going to change the shape of all the things that we have to do.”

    Using technology to deliver more-efficient supply chains can both streamline business processes and lessen environmental impact. But today, a company’s dedication to environmental stewardship is a big concern for the CFO’s office as well.

    CFOs: Don’t discount sustainability

    Chorley suggests thinking about sustainability as a risk component—one that threatens brand damage, higher insurance rates, and a looming toll from regulators.

    As governments press toward a zero-carbon economy, there will be an enormous cost to businesses that fall behind on pollution mandates and societal standards. That’s why today we see so many large corporations transitioning parts of their businesses to respond better to new economic circumstances driven by climate change, he says.

    There’s also the matter of reporting. Of course, it’s standard practice to thoroughly report financial metrics, but with the emergence of corporate social responsibility (CSR) reports, eventually a similar standard will govern disclosures on sustainable business practices.

    “And that, obviously, is going to impact financial organizations most directly,” Chorley says. “They'll probably be held accountable or have to respond to those additional reporting requirements.”

    Finally, for companies competing for talent, especially younger employees who are extremely concerned about climate change, a poor environmental record is a recruiting liability.

    The first rule of sustainability

    These concerns aren’t the same for every finance executive; they are highly dependent on the nature of their business, supply chain issues, and economic factors in their industry. For that reason, every company must find the approach that suits its goals best.

    “I often say the first rule of sustainability for a business is to stay in business,” Chorley said. No one benefits from measures that ultimately undermine a company’s ability to be successful.

    But Oracle can offer an example of a company that’s extremely focused on business outcomes taking a leading role in navigating the global shift to a greener future.

    Fifteen years ago, when Chorley was exclusively a supply chain product manager, it became “pretty clear that sustainability and environmental factors were going to be an important consideration in Oracle and in all businesses,” he says. “It was something that we had to respond to.”

    So Chorley assembled a small group within Oracle to start thinking about environmental issues in a way that was beneficial to the larger business, sharpening the company’s focus on being a responsible corporate citizen and getting the word out on its achievements.

    That work has led to Oracle recently committing to the ambitious goal of powering all its data centers, all of the Oracle Cloud Infrastructure, as well as its office facilities, entirely with renewable energy by 2025. Oracle has also committed to being net zero in carbon dioxide emissions by 2050.

    “Whenever we look at these issues, there's always a financial component to it, as indeed, there should be,” Chorley says.

    Author: Joseph Tsidulko

    Source: Oracle

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