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How Covid-19 has reshaped the role of CFOs in the corporate scene

By Tarik Bouarfa | January 19th 2021 at 13:00:00 GMT +0300

CFO Microsoft Middle East & Africa Multi Country.

The setbacks experienced as a result of the Covid-19 pandemic have been unlike any seen before.

The impact seen on the financials of industries and organisations across the globe has been unprecedented – with many not surviving to this point.

Globally, chief financial officer (CFOs) and finance teams have been hard at work to lead their organisations through the immediate crisis, ensuring the safety and protection of employees, suppliers and key stakeholders. They have also been collaborating across functions, assessing liquidity and conserving cash and reaching out early and often to investors to reset performance expectations.

For those who have managed to transcend the global lockdowns into the recovery phase, a new reality has very quickly come to the fore.

One, particularly for the CFO, they require a new, agile way of thinking.

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Drawing lessons from these unsettled months, the CFO must now permanently build speed and flexibility into functions that encompass forecasting, planning and resource allocation processes and incorporate new tools and rapid decision-making protocols into the finance team’s day-to-day work.

Experience has shown that whether the challenge is rooted in growing revenue or allocating resources, technology is the shortest path to better, more confident action.

But to bring technology to life, we must invest in our people. Taking on the notion of 'tech intensity' – which is an organisation’s rate of technology adoption along with its ability to build its own digital capabilities, as we enter recovery and reestablishment, we encourage CFOs to take risks, learn, educate and as a result, feel comfortable enough to embrace change beyond Covid-19.

New skills

As organisations start to discuss the return to the physical office space, remote working and hybrid working environments will remain at the centre of operations.

Employees across all functions will continue to work remotely using modern workplace collaboration tools, and organisations will, therefore, need to invest significantly in workforce engagement and training in new skills.

CFOs will also need to consider making a significant shift from fixed capital costs to variable costs by leveraging 'as a service' models like Microsoft’s Azure SaaS, PaaS and IaaS, employing technology-driven methodologies to foster cost transparency.

No one could have predicted a global pandemic and the ramifications thereof 12 months ago and while forecasting and scenario planning serve exactly that purpose.

Moving into an era of 'modern finance', CFOs must embrace advanced analytics to move from backwards-looking analysis to future-looking predictions and recommendations.

Machine learning is a critical tool for predicting outcomes and managing risk and solutions like the Cortana Intelligence Suite allows organisations to stay ahead by turning gathered data into actionable insights.

CFOs will continue to face an ever-growing risk landscape because of many factors, including geopolitical turmoil, regulatory reforms, market instability, and cyber threats.

However, moving forward into the modern finance era will require taking an ever-larger role in risk management that goes beyond traditional financial risk and compliance.

The virtualisation of the workforce and remote working could increase vulnerability to cyber risks, including data theft, ransomware, and other attacks.

Early warning

The layoff of staff and cost reductions could also increase vulnerability to failures of internal controls, due to stretched, disengaged, or ill staff. 

Lastly, organisations may have to revisit the internal audit process and incorporate more data analytic tools in assessing the risk landscape.

Leveraging and effectively harnessing the power of the cloud, CFOs can create early warning systems and tools that will enable them to proactively manage risk.

For example, using solutions in the Azure stack, CFOs can build a risk analytics platform to provide comprehensive coverage of all sales transactions, with predictive machine learning-based capabilities. As a result, driving a systematic review process and focusing on high-risk transactions.

With no doubt, CFOs will continue to face significant challenges to confidently make the next best decision for their company, their team, or their customers.

In the coming months, we will continue to see many organisations adapt to the new reality that has presented itself in the wake of uncertain times. As an industry, we encourage and will continue to do so – addressing those challenges with technologies that will enable CFOs and the organisations they represent to operate effectively.

- The writer is the Chief Financial Officer at Microsoft Middle East and Africa.  


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COVID-19 Tarik Bouarfa CFOs Microsoft
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