The Role Of A CFO: From Finance Analysts To Leaders In Digital Transformation

Introduction

Technology is transforming our world. It’s had a profound impact on the business landscape in recent years, and nowhere more so than in finance.

Consequently, heads of finance are now leading in ways they never previously imagined, tasked with overseeing digital transformation initiatives that not only shape their own function but impact the entire business.

Central to this are tools such as Microsoft Dynamics 365 Business Central, as they automate systems across business functions, from internal processes to product lifecycles.It’s a huge opportunity – and a big responsibility. This comprehensive guide is designed to equip CFOs with:

• An overview of this evolution in their role

• An understanding of how Business Central can improve access to essential business data and transform broader business operations

• How to navigate a successful Business Central implementation

• The advantages of CFOs and CIOs working more closely together

• The significant ROI of Business Central

How data is transforming business

Many of you will have noticed your roles are changing, and one thing has become clear; in order to succeed, you need quick, easy access to business data.

Looking at an individual business and being able to identify and analyse the relevant metrics, is essential to facilitate effective decision-making. As a company, it’s important to track revenue and profit: both are key indicators to understanding how well your business is performing. But we also need to recognise these numbers are the result of other KPIs. For instance, if a business focuses mainly on gross margin, you need to be clear on the other data that underpins this headline metric, such as average selling price or cost per unit.

Of course, knowing the data you need is one thing, but actually getting it is another, and while packages like Sage, Xero and Quickbooks might work well for small businesses, they are incredibly hard to scale, and struggle to provide the level of reporting and analysis that a growing business demands. To be able to dig into the data and use it to inform business strategy, you’ll need a finance system that goes further.

How technology has changed role of a CFO

While finance leaders have always been interested in accelerating performance and outperforming competitors, traditionally that was limited to numbers and spreadsheets.

But as that data pool gets deeper, and ththe e need to retrieve and understand the data gets ever more urgent, a different kind of infrastructure needs to be put in place. Essentially, what that means is shifting towards a more autonomous financial structure.

Until recently, this would have fallen securely into the domain of IT. However, as we find ourselves in a landscape that is increasingly digital and data-driven, finance leaders are tasked with understanding and embracing autonomous finance systems, and with them comes the ability to enhance efficiency, reduce costs, minimise risks, provide better financial services to customers, and ensure they remain competitive.

If that sounds an all-encompassing list, be assured that this trend is only going in one direction; Gartner predicts that, by the end of 2025, more than 40% of finance roles will be either entirely new or significantly reshaped due to the adoption of finance technology.

As finance leaders are pushed to revolutionise their operating models, they are also having to establish themselves as leaders in digital transformation – despite often having little to no direct experience. The potential gains are huge, however, with the promise of advanced technology integration, like AI, machine learning, automation and predictive analytics, giving businesses the ability to make faster and better informed decisions than ever before.

As the implications extend beyond the traditional boundaries of the finance function, CFOs are having to make big adjustments in how they approach their roles. Rather than looking only at the numbers, they have to work in a broader, more holistic way that involves understanding and collaborating with almost every business function.

This can be daunting. For a start, they will have a lot to learn about these other departments and the value they each seek from such transformation initiatives. Without this cross functional insight, each department will operate in isolation, against the competing priorities of the broader business. A modern CFO needs to do better than that, partnering with the other function leads on a joint and cohesive strategy. That can only come from a place of mutual understanding.

Secondly, there are the standard fears associated with all system upgrades. Any responsible CFO will rightly have concerns about poor transition management and the associated risks of data loss and security breaches.

Thirdly, there are the direct financial implications. Upgrading to a more robust system inevitably comes at a cost, so it’s important the CFO understands the expected payback. More on this later.

Finally there is the simple question of time: time that could have gone towards other strategic aims for the business.

The attention to detail required to drive this kind of transformation and the effort needed to sustain the momentum of change often demands a completely new mindset. Finance leaders will have to engage employees across their entire organisation, while also taking into account the potential disruption to employees, if they are to actively prevent the onset of change fatigue.

Furthermore, finance leaders may need to upskill, and often in areas where they have little or no experience. They will need to understand the new kinds of technology they’re working with and the many ways it can be leveraged. This education is not a one time only event. The landscape is forever evolving and a progressive CFO will have to develop channels and mechanisms to ensure they keep their finger on the technology pulse.

For the majority of CFOs, this is a significant step change, and not necessarily one they have sought to embrace. But the good news is that Microsoft Dynamics 365 Business Central and Creative Computing are here to support you every step of the way.

6 ways Microsoft Dynamics 365 Business Central helps organisations leverage technology

1. Integrated financial management capabilities

Business Central puts financial data and processes at the heart of the system. You’ll find key processes such as accounts payable and receivable, budgeting and financial reporting all in one place. This ease of use is hugely empowering: it ensures better visibility into business financial performance, and provides insight into metrics that drive output. For instance, the average selling price per unit, or the average cost per unit. This, in turn, enables better, more informed decision-making that allows CFOs and their teams to optimise investments and manage cash flow.

2. Automated financial tasks

Repetitive financial tasks such as invoicing, reconciliation and expense management can all be automated. This reduces the need for manual intervention as well as freeing up finance teams to spend time focusing on more strategic activities.

Typical features include inventory tracking to increase speed, more accurate reporting to decrease rework activity, and interactivity with Excel to save time.

3. Automated business processes

Business Central doesn’t just automate financial tasks, it can also be used to automate warehouse, manufacturing and supply chain management functions. Optimising these key processes, from stock management to production lifecycle tracking, can help ensure costs are kept to a minimum.

4. Built-in AI support

AI, specifically Microsoft’s Co-Pilot, is now a standard feature in Business Central, with Microsoft expanding its capabilities with every upgrade. From tools to help you forecast future revenue and predict late customer payments, to bank reconciliation and Copilot-generated analysis tabs, Microsoft’s AI presents multiple ways to help you optimise your key financial metrics.

5. Flexible and compatible ways of working – practically and globally

You can use Business Central on any device, whether that’s desktop, tablet or mobile (including iOS and Android). It’s equally flexible when it comes to geographical location: you can use Business Central in 47 languages and in over 160 countries and regions, so you can be sure it’s ready to expand whenever your business is.

6. Reliable, scalable performance

Working with Microsoft Cloud means your business can rely on industry-leading performance – now, and in the future. There’s also the added advantage that being in the Cloud is much more cost-effective than hosting on-premise.

The ROI of Business Central: 4 ways it will pay back your investment

1. A reduction in required finance and operations staff hires

When you’re a growing organisation and you’re limited by disparate ERP tools, you will inevitably have to hire more people. Business Central connects and centralises processes, automates tasks like invoicing and billing, and allows for workflows to be as automated as necessary, empowering employees to be more productive within their same working hours and reducing the significant cost of hiring as your business scales.

2. Improvements in operations flow.

Employees can use Business Central to gain visibility into the operations across the organisation, which, coupled with automation and increased ERP access across multiple devices, can lead to improved productivity. This will then allow your team to focus their attention on other initiatives to further increase the effectiveness of key processes.

3. Improved business effectiveness

There are many examples of how Business Central can improve the effectiveness of your finance and operations. Choose from features like inventory tracking to increase speed, more accurate reporting to decrease rework activity, production lifecycle planning and tracking to streamline operations, as well as interactivity with Excel to save you time.

4. Integrations with other Microsoft products

As you would expect, Business Central has been designed to integrate with other Microsoft products, including Microsoft 365. This offers multiple benefits: ease of use, increased confidence from real-time visibility, and the flexibility you expect from being on the Cloud.

This enhanced functionality inevitably means that setup costs may be greater than for the smaller, less powerful models you may be familiar with, but recent Forrester research has confirmed that the improvements in business processes pay off in a matter of months.

You can see some of the typical ROI data below:

ROUNDEL: ROI 172% [/] over 3 years

ROUNDEL: 7-month/ Payback on investment

ROUNDEL: Productivity + 18% [/] productivity gains for finance and operations staff

1. Source:  Total Economic Impact™ of Business Central, Forrester, 2023

Getting Started Getting Started and other Frequently Asked Questions

“How can I integrate Business Central with existing systems?”

Business Central’s extensive list of built-in APIs are extremely flexible.

They require no code and minimal setup to use, making them easy to integrate with a lot of different systems, from accounts payable automation to CRMs.

We are also able to assist with any system integrations necessary to implement Business Central in your business. Simply contact hello@creative-computing.co.uk and we can discuss what you need.

“How easy is it to integrate Business Central with other Microsoft products?”

As discussed, Business Central works particularly well with other Microsoft Products such as 365, including tools your teams are already familiar with, such as Excel, Outlook and Teams.

In addition, Business Central, like all Microsoft Products, benefits from regular updates and industry-leading technical advances, so you can be sure you have the best tools available, designed to help you and your team be as productive as possible.

“How long does it take to implement Business Central?”

This naturally depends on the size of the business and the scale of integration, but on average, implementation takes three to six months.

An additional variable is the amount of company resources, including time, available to help engage with testing and training.

“What resources will I need in place to do it?”

Ultimately, Business Central needs to be implemented in a way that works for your company, and so it does require some input from you to make that happen, ideally with a project lead to drive everything through.

Just contact hello@creative-computing.co.uk and we can help you and your team get off to the best start.

“How can I find out what other uses Business Central will have for my business beyond finance automation?”

The simplest thing to do is to contact hello@creative-computing.co.uk and share an overview of your business and its current setup, including the challenges and frustrations you are facing on a day-to-day basis. We will then work with you to understand what success might look like with an upgrade to Business Central. From this, we can put together a comprehensive plan that responds to your business issues and meets the defined criteria.

“How can the CFO and CIO work together to ensure the successful deployment of Business Central?”

According to a recent Forbes report, only 30% of CIOs report strong working relationships with their CFOs.

This may be unsurprising. Traditionally the two roles have worked at opposite ends of the business spectrum, and it’s unlikely they will have been called upon to collaborate regularly. But faced with the CFO’s widening scope and the growing impact of technology on all business functions, such a siloed approach will no longer suffice.

As in all relationships, regular, open communication is key: by continuing to discuss and consider topics that drive valuable partnerships and align strategic objectives, businesses can exploit the many rich skill-sets within their workforce to ensure productivity is fully maximised. Combined, this will give you the knowledge, experience and leadership required to execute complex digital initiatives successfully.

By distributing key resources and enlisting your CIO for support, CFOs can lead digital transformation efforts whilst still having time to focus on their core tasks. Furthermore, if this is a CIO who is well versed in the full range of Microsoft products, integrating Business Central becomes far easier.

Combined, this puts the CFO, the CIO, their teams, and, ultimately, your entire business, in the best position to face the future.

To discuss your particular requirements, send us an email at hello@creative-computing.co.uk, and we’ll set up a free call to explore the opportunities for your business.

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