As I often remark, CFOs and other senior finance professionals are transitioning from “bean counters” to “bean sprouters,” as we play a greater role in our organizations’ strategy. According to a report recently released by BlackLine and Middle Market Executive, CFOs at mid-market companies are experiencing a similar transformation. I spoke with Therese Tucker, CEO and founder of cloud-based finance controls and automation software provider BlackLine about the evolving role of finance and how technology has paved the way.
This interview has been edited and condensed.
Jeff Thomson: BlackLine recently released a report on finance executives at middle-market firms. What is the report’s biggest takeaway for CFOs?
Therese Tucker: Finance is evolving. Like their counterparts at large organizations, middle-market CFOs are fully leveraging technology across key finance and accounting processes to support their enterprise performance management agenda. They are improving the control and visibility of data while giving their teams the opportunity to focus their energy on enhancing business intelligence, developing more accurate forecasts, and tightening internal controls to assure accurate financial reporting and proper compliance. And, thanks to cloud-based solutions, they are able to implement these technologies despite limited IT and financial resources.
In short, the modern finance movement is increasingly becoming a competitive differentiator.
Thomson: Can you expound on the ways technology, and specifically automation, has impacted the transformation of the finance function?
Tucker: Our survey found that more than 25 percent of respondents said their finance teams spend more than half of their total time each year collecting, entering and validating data, with an additional 35 percent saying their teams spend between a quarter and half of their total time on these tasks. That’s pretty unbelievable when you think about all of the well-paid, college-educated employees who are devoting much of their day doing rote, manual tasks. I’m sure that wasn’t their dream when they decided to become accountants.
Automating these manual processes has huge implications for the finance function. First, there is greater control and visibility of the data with reduced compliance risk since employees are no longer using multi-line spreadsheets to complete their duties. But most of all, automating these processes will transform the finance function by freeing finance professionals from the enormous amount of time they spend collecting and verifying data, giving them the opportunity to redirect their efforts toward analyzing the data and being much more productive, strategic employees. I suspect they will be much happier employees as well.
Thomson: Are there other factors causing this transformation of the finance department?
Tucker: What we are seeing now with the CFO at middle-market companies is just a continuation of the trend that has been transforming the role of the CFO at large organizations for the past decade, with the CFO assuming more strategic roles in their organizations and taking on additional responsibilities beyond finance and accounting. In fact, Robert Half recently released a study that found that over the past three years alone, 85 percent of CFOs have assumed responsibilities for new departments, most commonly IT and HR.
Like their counterparts at large organizations, middle-market CFOs are increasingly being tasked with making strategic investments in technologies that improve decision-making around budgeting, forecasting, the period-end close and a host of other finance and accounting processes. Let’s face it, Enterprise Resource Planning (ERP) systems have long been an integral part of every finance organization, but they can only get you so far.
Thomson:Your study found that a lack of IT is the top obstacle for middle-market finance professionals. What are some ways they can overcome this?
Tucker: The biggest game changer is SaaS. Software as a service typically requires very little IT resources and allows the business owner to direct and control the implementation of their selected software. There’s no need to order hardware, schedule scarce IT resources or compete for resources against other systems.
We are living in a very exciting time where cloud-based applications are transforming the way we work. In fact, more than 50 percent of the executives in our survey said they felt cloud-based applications can help their organization reduce the cost and time needed to deploy new finance tools.
Thomson: What steps can finance professionals take to ensure they are viewed as transformational employees within their organizations?
Tucker: The CFOs who are being seen as agents of change are the ones who are leveraging technology to automate many of these manual processes, which liberates finance and accounting teams and affords them the opportunity to be better, more strategic partners within the broader organization.
Modern finance professionals who want to be viewed as transformational should show enthusiasm and curiosity to try something new with the additional time they have been given thanks to automated processes. Look for ways to turn data and information into insightful analysis that assists the organization in planning, strategy and decision-making. They should use the extra time to innovate and add strategic value.
