What will the CFO of the future be like? The book Reinventing the CFO: Moving from Financial Management to Strategic Management describes five areas of the CFO's agenda:
- Partnering – Integrating Finance into the business, moving from a "numbers cop" to a partner in such areas as performance reporting, pricing, and product development.
- Strategy – Providing strategic analysis and insights to ensure operations managers take intelligent risks and reach consistent decisions.
- Management Control – Delivering balanced measures and value-added analysis in real time.
- Cost Management – Implementing cost management systems that provide relevant cost information, and create an environment for cost control and reduction.
- Systems and Processes – Optimizing the efficiency and effectiveness of performing the financial processes and supporting the core business processes.
We have participated in several projects mentioned as "better" or "best" practices by this book. These projects show what progressive CFO's can do:
- Moving to a virtual close – By using production system transactions to automatically generate accounting entries, this hosiery manufacturer reduced its cycle time to generate financial statements from four business days to one, making the monthly closing a non-event.
- Implementing process improvements – By integrating the previously distinct annual budgeting, planning, and activity review processes, this health insurer simplified the work of line managers and increased their understanding of the relationships among strategy, activities, and costs.
- Managing, storing and distributing project information – By using Lotus Notes to track the progress of construction projects and to store scanned or electronic versions of key documents, this commercial contractor allows its managers and clients to collaboratively manage a complex project.
- Comparing business strategies and financial results – By comparing its financial results with those of sourcing companies, this athletic apparel manufacturer has determined the best performance achievable by continuing its manufacturing strategy.
The agenda for the CFO of the future is challenging, but it is one that must be accepted and handled. Who would want a CFO like this? Any company that wants a bright future. Who would want to be a CFO like this? Any accountant who aspires to something more than recording transactions.
All of our projects typically require strong skills in both accounting and information systems. We see this as another trend for the CFO – assuming responsibility for all information used to make business decisions, including that outside the general ledger.
Todd L. Herman
Client Project Update:
I am pleased to provide you with an update on our client projects. Projects we have completed over this period are...
Assisted Insurance Client With the Purchase of New Hardware
Assisted an insurance client in the evaluation, negotiation, and purchase of new hardware and software for a comprehensive financial system, helping position the financial areas for efficiency gains and improved access to information.
Streamlining a Budget and Planning Process
Completed the development of an extensive Excel budget development tool for a large health care insurer, providing on-line validations and integrated project and payroll planning, streamlining the budget and planning processes.
Evaluated Computer Specifications for a Furniture Industry Supplier
Evaluated and recommended computer specifications and models for a furniture industry supplier, preparing them for main business system enhancements and Lotus Notes collaboration applications.
Evaluated Existing Manufacturing Systems
Evaluated existing manufacturing systems at two upholstery plants, recommending one system to manage both facilities and allowing increased coordination of customer service and sharing of information.
Future projects we are planning include...
Purchasing, Accounts Payable, and General Ledger Implementation
Implement the Purchasing, Accounts Payable, and General Ledger portions of a fully integrated suite of financial products, assisting the client in overall project management, integration issues, training, and procedural changes required for the new system.
Inventory Tracking & Recording
Review the inventory tracking and recording for a hosiery manufacturer, recommending ways to increase the accuracy of inventory information on both the shop floor and accounting systems.
Development of Lotus Notes Application
Develop a Lotus Notes application to allow a paper products distributor to send current product and price information to its field sales representatives, reducing the need for costly distribution of hardcopy lists and increasing the frequency of information distribution.
Review Salary & Staffing Information
Review the salary and staffing information for key departments of a university, cleaning up data to prepare to implement a new budgeting system.
