How the ugly CFO turned into a prince charming called CPO
In large and medium-sized companies, the CFO can today rely on digital transformation and data processing and analysis technologies that are gaining momentum within the executive committee, or even position himself as a true business partner thanks to quality data and relevant information in real time. This "connected" CFO and instantaneous translator of the organization's economic performance is seen by many as the new prince charming of shareholders and some start dreaming of this Chief Performance Officer (CPO) who is praised by many “troubadours”.
Digitalisation created the dream of a CPO
The CPO, a child of digitalization, has inherited the best fruits of his parents' labour: accounting and controlling. As digitalisation takes over much of the manual work of finance departments, CFOs and their teams are increasingly free to do more value-added work and take on a strategic leadership role that was often denied them due to lack of time or resources. In the meantime, the digitalisation of accounting has progressed so far in some sectors that the position of accountant has become almost obsolete. This is one of the reasons for the success of robotic process automation (RPA) solutions, peripheral "enablers" to ERP specialized in the optimization of a specific area (P2P, O2C, Process Mining) because they allow to respond quickly to specific needs in a more agile and fast approach.
This outrageous digitalisation is not new. Let's not forget that major ERP implementation projects, in which accounting and finance functions were intrinsically linked, now go back more than 20 years.
These large monolithic IT projects, which used to take years to see the light of day, are now giving way to iterative developments in information systems, carried out with a view to continuous improvement, with a prioritisation of the operational and business issues to be addressed.
Thus, the CFO, who was in charge of managing data input, finds himself simply organizing the input to extract the substantial marrow from the output. Data science is thus entering corporate finance and transforming the CFO into a business partner who, beyond the financial report, will influence the strategy, or even be the real director of its implementation.
The Chief Performance Officer has just been born. But how to become the CPO that everyone wants to have in their organisation today? Beyond the implementation of high-performance systems that allow the relevant data to be captured, the CFO will need to bring special qualities and know-how.
Have a holistic understanding of the organisation
The CPO is responsible for a number of diverse services that already fall under the purview of the CFO in many organizations. Therefore, the CPO must take into account data from all parts of the organization and have a global view of the business. It is not necessary to understand each team at the process level, but it is essential to be able to inspire them towards better results. To do this, you need to know what they are primarily aiming for and why.
Be constantly on the lookout for growth
For many years, shareholders and executives have demanded that the CFO compare results to benchmarks. This is a too static activity for a forward-looking business partner. Furthermore, the CPO will look for new areas of potential growth, track risks and opportunities to identify trends and inspire, if not instil, strategic measures. To do this, he /she will need to understand the growth models of his/ her organisation and even of the industry in which he /she operates. The industry-disconnected CFO will soon be a thing of the past.
Making his / her analysis comprehensible to all
Communication is the cornerstone of strategic management. The ability to explain and advise the action to be taken to the entire organisation will make the CPO a strategic member of the executive team. CFOs were not always supposed to do the sometimes uncomfortable talking themselves to get buy-in from different departments - it is others who try to convince them, not the other way round.
Applies the principle of continuous improvement to oneself: continuously learning
The CPO, must move from the role of financial manager to become a multidisciplinary leader and inspire teams outside of finance such as IT or HR. Leadership is a quality that can be learned if one attaches some basic principles to it and does not aim at the position of inspirational leader.
The magic kiss might take longer
In conclusion, for all CFOs and their team, this new paradigm implies the acquisition (or recruitment) of new skills, well beyond "hard skills" with employees capable of processing data or having an end-to-end vision of a process but also "soft skills" to communicate, federate around projects and play the role of an ambassador.
These new pre-requisites for the position could have a positive impact on the attractiveness of the CFO's job, but also on the entire job landscape that could lead to this position. In fact, in addition to the increased interest of the missions within the job itself, these new skills are particularly valuable on the job market, especially in the context of increasingly less linear careers.
The ugly grey frog that the CPO-fans want to describe to us would therefore become sexy thanks to digitalisation. Let's make no mistake about it; the CPO described above is a woman or a man who today, in most organizations, has difficulties finding his or her place in the financial sector because he or she is too innovative, not sufficiently shareholder-oriented or sometimes scares the CEO. He or she will have to use pedagogy to make people accept this new role, which will certainly bring enormous added value to all stakeholders.
The magic of a kiss will not transform the frog instantly!