I recently attended the annual strategic planning meeting of the IMA's Technology Solutions & Practices Committee during which we had some lengthy conversations about the evolution of management accountants moving from a more transactional focus to an increasingly strategic role to help the company make decisions that impact growth and value. Part of the reason for this transformation is technology. Not only are CFOs needing to be masters of their traditional craft - management accounting - they are also needing to become masters of technology.
Information is the lifeblood of business, and CFOs rely on massive amounts of information to drive decisions and perform their roles well. Technology is what helps them create, access, validate, analyze and report that information to the rest of the management team, board and external stakeholders. To keep the system functioning smoothly, CFOs need to understand how to leverage technology properly. In fact, if embraced by the profession, technology becomes an enabler for CFOs and management accountants, not an obstacle hindering their evolution.
It's commonly understood that technology is considered a major factor of change, along with economic, social, cultural, regulatory, political and other key factors. Advancements in technology have impacted the ways in which management accountants work, moving them along an arc towards more strategic thinking and data-driven decision making using advanced data analytics and other inputs. Companies are creating more data today than they did in the entire previous decade. Data is financial and non financial... structured and unstructured... and it’s now being sourced beyond traditional ERP or financial reporting systems, some of which might even include “systems” with questionable controls and monitoring that output data of less-than-desirable quality.
CFOs need to be able to weed through all of this information to find what is relevant to running the business (e.g., material information), and they need to ensure that its quality, lineage traceable back to the original source data and overall integrity are maintained. How do they do all of this? In part, through the effective use of information technologies backed up by a strong data governance program.
Some in the management accounting profession run the risk of stagnation, or even disintermediation, if they don't at least keep up with change in business brought about by technology. Technology will continue to give businesses advantage over their peers. Part of that advantage is derived from leveraging technology to make the right strategic decisions – quickly – using what the company knows about itself and the market and predicting with confidence the next steps. CFOs have the ability to access decision-critical information and be part of those strategic discussions in the C-suite, but they must master the domain of information technology to do this effectively.
The era of the Chief Financial & Technology Officer (CFTO) is upon us, perhaps currently in all but name. The name will come. After all, change is inevitable.#IT #CFTO #cfo #technology #hybrid #managementaccountant #tech #advancedanalytics #TechTalk #analytics #informationtechnology #Csuite