The role of the CFO has changed and there is a greater need for them to provide strategic alignment. Presently, they are moving beyond their “back office” function, towards the role of strategic business advisor. Additionally, current operating environments demand that finance work in partnership with operations, sales, HR, and other business units to help shape the company’s roadmap.
With these competing expectations and changes, we have put together 3 strategies a CFO can implement to improve strategic alignment.
1. Get familiar with cross-functional business units
Traditionally, finance teams have worked in silos, with little exposure or interaction with other business units. Today’s operating environment requires a comprehensive understanding of all areas within a business to achieve strategic alignment. CFOs now need to be familiar with the market, operational and sales strategy to obtain a complete picture of the company’s value chain. This level of collaboration helps CFOs create strategies that support growth targets and assists with challenges. It is a process that considers how the numbers will be achieved.
Through the strategic alignment of your strategy and purpose with your organisations capabilities you create the opportunity for company success. You may have a great strategy, but if you are not aligned with your organisation’s capacity to perform and scale you will not achieve set targets.
2. Create a growth culture
Growing or sustaining a business through covid-19 has seen certainty and stability replaced with indecisiveness and unpredictability. Strategies that used to fuel an organisation’s performance may no longer be sufficient to achieve the same result. CFOs now have the opportunity to navigate a company through the current environment. By questioning existing methods and frameworks, the CFO has the opportunity to take the lead.
CFOs have a range of skills and strengths that they can bring to the wider business. Their knowledge of systems, data analytics, and decision-making capabilities can extend well beyond the boardroom. Question traditional models and processes and consider how you can incorporate more agile methodologies. Inspire and motivate employees to adopt a growth culture and mindset. Define performance accountability and put in place frameworks that make employees aware of your expectations around productivity. Realistic benchmarks will make everyone accountable and allow you to measure and improve productivity across the organisation. Addressing concerns around both people and processes can help you bring greater strategic alignment.
3. Put the right technology in place
Businesses face risks and opportunities daily as digital transformation and technology matures. Technology is no longer “just” a supporting tool, instead it is an indispensable enabler that drives decision-making and performance.
Unified data lakes, enterprise performance management, and business intelligence tools are the gold-standard when it comes to building your digital eco-system. More mature organisations have already adopted and advanced their positioning through, Artificial Intelligence, Predictive analytics and the IoT.
Thus, CFOs need to identify the right technology to harness opportunities as they arise, as well as eliminate potential risks. For CFOs, it is essential to partner with the CIO and CTO to fully understand how the information strategy fits into the organisation. With a clear understanding, CFOs can better evaluate IT investments. Similarly, they can ensure the business is supported with the right technologies for executing outcomes, optimising performance and creating strategic alignment.
If you are finding it difficult to provide your organisation with greater strategic alignment, contact the team at Minerva. We are a Management Consultancy that is laser focussed on business transformation. We assist CFOs and transformation specialists every day to improve their data management, budgeting, forecasting, and planning. Our goal is to give you more time to focus on business growth and strategy.