As companies digitise their financial processes, they are accumulating enormous amounts of data about operations and customers. The point of collecting this information is to provide insights that leaders and teams can use to make better decisions.
As a result, visual reporting is gaining momentum. Foundry’s 2021 Data and Analytics survey found that 69% of organisations are piloting or using visual dashboards and data visualisation tools to consolidate and share information. By 2025, data stories will be the most widespread way for organisations to consume analytics, according to Gartner.
“Portraying financial data in a user-friendly way allows people to discover connections they wouldn’t have seen otherwise,” says Scott Freedman, director of marketing at Sage Intacct. “With that information, they can make decisions that improve the business.”
But at many organisations, this new type of reporting has yet to gain traction: Over half of finance departments struggle to provide data and reports stakeholders can rely on to inform their decisions, according to Gartner.
Data is only useful when people can easily find it, understand it, and put it to work. When it’s buried in spreadsheets and scattered across departments, teams often don’t know where to look for it. Searching takes up valuable time, and the numbers teams find often lack context. “Data is too often siloed and represented in ways that don’t allow people to slice and dice it the way they need to,” says Freedman.
In addition, spreadsheets can’t keep up with real-time operations. “They are stuck in time,” Freedman says. “They show recent or long-term past performance, but not the real-time reporting you need to predict the future.”
Frustrated by the inability to use their data effectively, management teams are turning to new solutions that collect data across the business and present it in customised dashboards. The dashboards don’t just display facts and figures. Instead, they create a narrative that places the data in context, along with graphical depictions that help bring it to life. Finance leaders and teams can easily filter the information to learn what’s working and what’s not, and thenuse these insights to improve operations or find new revenue opportunities.
For example, Quicksilver Express Courier, a “last mile” delivery service, collected all kinds of data about its fleet, but lacked visibility about individual vehicle profitability. After adopting Sage Intacct, Quicksilver’s finance executives were able to drill down into the profit and loss for each truck. As a result, the company learned it was overpaying for workers’ compensation insurance, and subsequent adjustments saved £100,000 a year. Other changes based on insights Quicksilver gained from the platform helped the company increase total profitability at some of its locations by 5% to 25%.
In addition to improving business results, sharing information through customisable dashboards helps executives better communicate with their teams. Reports don’t necessarily show why results are important, but presenting them in a narrative with visual illustrations explains them more effectively and makes leaders’ recommendations more meaningful and convincing.
Teams can experiment with their dashboards, using real-time information, charts, and graphs to try out ideas for improving processes or services. “You can look backward or forward and use real-time insights to predict future results,” Freedman says.
Organisations have long been in search of the Holy Grail of financial management: A single source of truth they can use for accurate reporting and budget planning. But the reality is that financial information is too often scattered among spreadsheets and other applications that don’t communicate with one another, making data management unwieldy and time- consuming.
Part of the challenge is the lack of a holistic approach to data management. Fewer than half of business and technology leaders have a clearly defined data and analytics strategy, the Foundry 2021 Data and Analytics study found. A haphazard approach can lead to data silos that impede sharing and collaboration and create inconsistencies, since information is formatted differently among applications and updates occur at different times. “Siloed dataoperates on different schedules, making processes like revenue recognition difficult,” says Scott Freedman, director of marketing for Sage Intacct.
In addition, financial leaders and teams who manually transfer data into spreadsheets and reports may make errors along the way. In the Foundry survey, leaders identified data- quality problems as the No. 1 roadblock for organisations adopting data-driven initiatives.
Integrating financial data into a single cloud-based platform improves data quality and accuracy and makes sharing information easier. Instead of individuals “owning” their own set of data, an integrated solution provides everyone with a common, updated, and accurate set of numbers to work with across the business.
Improving data accuracy can have a tangible impact on business performance. A recent Gartner study found that breaking down silos and sharing data boosts business outcomes. Gartner predicts that by 2023, organisations that promote data sharing will outperform their peers on most business metrics.
By shifting to Sage Intacct, a unified cloud solution for financial data, courier service Quicksilver Express reduced the time for doing its monthly close by 50%. Credit card and bank reconciliations are now done daily, reducing errors and eliminating a week’s worth of manual work. And overall accounting efficiency is up by 75%.
Family-owned investment firm Halstatt experienced similar benefits after switching to Sage Intacct. In the past, because valuation reporting took over 100 hours, the company only had time to do it annually.
Now the process takes just a few hours and is done quarterly, giving executives a detailed view of asset value and costs throughout the year.
Data is projected to play a greater role in business strategy in the future, as leaders gain new insights from advanced analytics. 78% of leaders expect data and analytics to fundamentally change the way they do business over the next 3 years, according to the Foundry study. The cloud, along with advanced capabilities enabled by AI and machine learning, will help companies get more proactive in mapping the best path forward.
“When you have an accurate view of what’s going on today, you can use AI and analytics to project that data out and determine future needs and capacity,” Freedman explains. “That helps companies deal with unanticipated surges in demand, or make adjustments to marketing campaigns based on their performance. Connecting systems throughconsolidated reporting makes the whole business run more smoothly.”
Introducing X3Connect!
At X3 Consulting we want to ensure you are maximising the potential of your investment into the ERP world. We have been listening to our customers and finding out what other areas they would like to improve on across their business operations. We’ve had requests for expense management, warehouse management, banking automation, driver scheduling, so we have put together monthly webinars to introduce various integration solutions for both Sage Intacct and Sage X3.
We’ll be holding the very first webinar in October and these will run until the end of the year.
In these 30 minute webinars and you will get some information about the highlighted solution and a brief demo of what is can do to help your organisation.
This could be the best 30 minutes you’ll ever spend to save you hundreds, even thousands of hours in the future.
Here is the schedule so far:
12th October 2023
12.00-12.30
Introducing Yooz
Yooz provides a cloud-based E-invoicing and Purchase-to-Pay (P2P) automation solution. It delivers unmatched savings, speed, and security with affordable zero risk subscriptions to more than 5,000 customers and 300,000 users worldwide.
Our solution uses Artificial Intelligence and RPA technologies to deliver an amazing level of automation with extreme simplicity, traceability, and end-to-end customizable features It integrates E-invoicing and AP Automation into information systems or ERPs with more than 250 native connectors.
9th November 2023
12.00-12.30
Introducing Emburse
From unlimited receipt scanning and mileage tracking to next-day reimbursement and direct accounting integrations, automate your expense management and pre-accounting workflow with Emburse easy-to-use expense management software. Finance professionals and employees around the world trust Emburse’s solutions to automate manual processes, ensure compliance, and deliver deep spend insights that inform smarter decisions.
14th December 2023
12.00-12.30
Introducing AccessPay
AccessPay replaces manual banking processes with automated workflows that help you reduce the risk of fraud and error, gain better cash visibility & streamline your finance operations. AccessPay leads the fourth generation of finance transformation by connecting those disparate systems and banks for an integrated, more efficient, more secure future of finance. AccessPay breaks down siloes across finance and treasury, helping organisations solve key challenges around reducing risk and scaling corporate banking operations effectively.
MORE DATES TO FOLLOW WITH OTHER INTEGRATION PARTNERS IN 2024!
Organisations have long been in search of the Holy Grail of financial management: A single source of truth they can use for accurate reporting and budget planning. But the reality is that financial information is too often scattered among spreadsheets and other applications that don’t communicate with one another, making data management unwieldy and time- consuming.
Part of the challenge is the lack of a holistic approach to data management. Fewer than half of business and technology leaders have a clearly defined data and analytics strategy, the Foundry 2021 Data and Analytics study found. A haphazard approach can lead to data silos that impede sharing and collaboration and create inconsistencies, since information is formatted differently among applications and updates occur at different times. “Siloed dataoperates on different schedules, making processes like revenue recognition difficult,” says Scott Freedman, director of marketing for Sage Intacct.
In addition, financial leaders and teams who manually transfer data into spreadsheets and reports may make errors along the way. In the Foundry survey, leaders identified data- quality problems as the No. 1 roadblock for organisations adopting data-driven initiatives.
Integrating financial data into a single cloud-based platform improves data quality and accuracy and makes sharing information easier. Instead of individuals “owning” their own set of data, an integrated solution provides everyone with a common, updated, and accurate set of numbers to work with across the business.
Improving data accuracy can have a tangible impact on business performance. A recent Gartner study found that breaking down silos and sharing data boosts business outcomes. Gartner predicts that by 2023, organisations that promote data sharing will outperform their peers on most business metrics.
By shifting to Sage Intacct, a unified cloud solution for financial data, courier service Quicksilver Express reduced the time for doing its monthly close by 50%. Credit card and bank reconciliations are now done daily, reducing errors and eliminating a week’s worth of manual work. And overall accounting efficiency is up by 75%.
Family-owned investment firm Halstatt experienced similar benefits after switching to Sage Intacct. In the past, because valuation reporting took over 100 hours, the company only had time to do it annually.
Now the process takes just a few hours and is done quarterly, giving executives a detailed view of asset value and costs throughout the year.
Data is projected to play a greater role in business strategy in the future, as leaders gain new insights from advanced analytics. 78% of leaders expect data and analytics to fundamentally change the way they do business over the next 3 years, according to the Foundry study. The cloud, along with advanced capabilities enabled by AI and machine learning, will help companies get more proactive in mapping the best path forward.
“When you have an accurate view of what’s going on today, you can use AI and analytics to project that data out and determine future needs and capacity,” Freedman explains. “That helps companies deal with unanticipated surges in demand, or make adjustments to marketing campaigns based on their performance. Connecting systems throughconsolidated reporting makes the whole business run more smoothly.”
Human error in the finance function creates an average of 25,000 hours of avoidable rework at a cost of approximately £878,000 per year, according to research by Gartner. Numbers like this are anathema to modern business, which prioritises organisational efficiency. In Foundry’s 2021 Digital Business Study, improving employee productivity and performance was the top objective for organisations’ digital business strategy.
For finance teams, manual processes can introduce critical mistakes that have a direct impact on business performance. “When people have to gather and process information manually from different sources, it’s not only inefficient, it can also create errors that cause a ripple effect,” says Scott Freedman, Director of Marketing for Sage Intacct.
That’s why many companies are turning to AI- and machine learning-based automation to speed workflows and catch costly mistakes. Automation streamlines previously manual processes to help finance teams close the books sooner, giving them more time to focus on strategic tasks. 50% of organisations are actively researching or piloting AI and machine- learning initiatives, according to the Foundry study.
By ingesting large volumes of data from financial applications across the organisation, machine-learning algorithms also can gain a sense of where data should be placed and what kind of numbers are appropriate for a given field.
“For example, if someone makes a duplicate entry in an expense report, an algorithm will flag the manager,” Freedman says. Sorting out errors at this stage prevents them from holding up an audit down the road. The system can also automate reminders to managers who need to make a decision or approve a change, saving busy employees from having to send repeated emails.
Many common financial processes can be automated, and algorithms can import information from one software application into the form fields of others. Some solutions can even generate reports and send them out to stakeholders.
Automating processes using Sage Intacct has enabled private investment firm Halstatt to reduce the time employees spend compiling consolidated reports and a board book from up to 100 hours to minutes. The company’s expense reporting application now automatically posts journal entries and triggers check payments, lowering fees from £36 per cheque to less than £4.
Automation also ensures that the data Halstatt uses is correct—and creates an audit trail to prove it. As a result, external auditors spend 2 weeks onsite rather than 4 to 6, and the company is saving £100,000 a year on fees and preparation. Overall, Halstatt’s accounting efficiency has increased 60%, giving the company the resources to create an alternative investment structure that has led to a £26 million investment.
“Automating simple procedures can save organisations staggering amounts of time and money,” Freedman says. “By eliminating repetitious tasks, they can develop strategies that drive growth.”
CFOs and their finance teams are in many ways at the centre of an increasingly complicated threat landscape. The information they use is too often stored in unconnected databases, hard drives, and software applications, which teams export into spreadsheets and send across the organisation as email attachments. Each data transfer and hand-off introduce a new set of risks—at a time when cyberattacks are rapidly increasing. Data compromises rose more than 68% in 2021, according to the Identity Theft Resource Center.
Breaches are also getting more expensive. The average cost of a breach rose 10% to £3.6 million last year, the IBM/Ponemon Institute’s 2021 Cost of a Data Breach survey found. Leadership teams know they need to do a better job of securing sensitive financial data. In Foundry’s 2021 Digital Business study, over a third of business and IT leaders cited improving security as a top strategic objective, and 58% said security had taken on greater importance as a result of the pandemic, when many companies switched to remote operations.
Bogged down by manual procedures
When it comes to financial data, many security and compliance issues stem from the use of outdated, highly manual business processes, including sharing financial data through spreadsheets and emails.
People with access to financial data and processes are especially attractive targets for cyberthieves. With manual processes and locally stored spreadsheets, people may send sensitive data to those who shouldn’t see it or post it on internal messaging platforms that don’t meet compliance rules. They also may share it with vendors and contractors, taking it out of company control. Every new instance of data sharing opens the door to a potential breach. “When information changes hands, you don’t know who’s accessing it or who’s changing it,” explains Scott Freedman, Director of Marketing for Sage Intacct.
Safety in the cloud
Consolidating financial information on a cloud-native platform creates a single source of truth, substantially reducing these types of risks. Cloud-native applications are built with granular controls for compliance and access. This allows finance managers to provide different levels of information to different stakeholders, via personalised dashboards that display all the information they need to do their jobs, but nothing more.
- Not all cloud-based applications provide the same level of safety precautions. Because security is critical, it’s important to determine whether a solution meets your specific needs. Here are some of the questions financial professionals should ask:
- Audit and compliance controls: Does the solution support audits to validate compliance with all the rules we must follow? Examples include SSAE 18, SOC 1 Type II, SOC 2 Type II, ISAE 3402 and 3000, PCI-DCC Level 1, HIPAA, and GDPR.
- Security incident response: Does the solution support the ability to react quickly to actual or suspected unauthorised access? Does it review data logs for signs of trouble?
- Data loss prevention: Does the solution have technology to identify and prevent data loss in email, collaboration tools, and other internal systems?
- Monitoring and penetration testing: Does the provider monitor and review its servers and user activity? Does it conduct regular tests on data, applications, systems, and infrastructure?
- Network security: Does the solution have up-to-date firewalls and antivirus software? Does it also remove unnecessary features that could serve as portals to future hacks?
- Business continuity and disaster recovery: What are the vendor’s procedures for securely backing up and restoring our data in the event of an emergency? What does their solution do to prevent data loss and maintain data integrity during the transfers?
A cloud-native application offers stronger protections for financial data than an on-premises system, but not all cloud providers are alike. Before making the transition, take the time to document your needs and make sure your critical data will be in good hands.
A checklist for all new CFO’s to empower decisions
Being a new CFO can be thrilling and empowering—but also sometimes a bit overwhelming, especially if it’s your first time in a senior leadership role.
With our handy checklist in hand, you’ll know what to expect, so you can prepare yourself to handle everything from the intricacies of your financials to your first board meeting.
It’s worth noting that this is a guide, and you may want to tweak and adapt this to meet your needs—but this provides a starting point for you.
Here’s what we cover:
1. Define your top CFO priorities in your new role
2. Do your research
3. Find an external mentor
4. Define what success looks like
5. Meet with your finance team right away
6. Understand your finance team’s relationship with other departments
7. Understand your CEO’s vision and long-term strategy
8. Build a picture of your company’s current financial health
9. Understand current cash flow
10. Know your company’s accounting practices
11. Review your financial reporting
12. Audit issues
13. Review budgets
14. Understand your key financial metrics with benchmarking
15. Meet important external stakeholders
16. Get involved with strategic planning
17. Build your long-term vision and plan
18. Get input and buy-in on your vision
19. Make an impact at your first board meeting
20. Understand potential CFO challenges and roadblocks
21. Don’t try to tackle everything at once
22. Tap into the power of tech
23. Place confidence in yourself and why you were hired
24. Summary
There will be a lot on your to-do list and in your inbox, so we suggest focusing on these three areas.
1. Define your top CFO priorities in your new role
Understand your financial performance and challenges
You’ll want to deeply understand your organisation’s financial performance and identify any challenges you must address.
Look at:
- Analysing financial statements, budgets, and key performance indicators (KPIs) to evaluate your company’s financial health.
- Identifying areas of strength and weakness to form the basis for future strategies.
- Determining any operational or strategic challenges that may impact financial performance.
Build vital relationships
Building strong relationships from the start is essential if you want a successful tenure as a CFO.
Aim to:
- Immerse yourself in the company’s culture, values, and priorities to understand it better.
- Collaborate with other executives and stakeholders to develop a vision for your company’s financial future.
- Prioritise building a strong relationship with the CEO and fostering effective communication and collaboration.
- Meet with your direct reports and key finance team members to establish open lines of communication and gain a deeper understanding of their roles and responsibilities.
Develop a long-term vision and plan
The business might expect you to map out a long-term financial vision and plan, so spend some of your first 90 days creating a great one.
Make sure you:
- Collaborate with the CEO to understand their vision for the organisation and align your financial strategies accordingly.
- Work together to develop a comprehensive long-term financial plan that aligns with the organisation’s strategic priorities.
- Outline key financial objectives, initiatives, and performance metrics to guide decision-making and measure progress.
- Continuously evaluate and refine the long-term plan based on evolving business needs and market conditions.
You may have your own priorities but it’s vital to set them upfront and use them to communicate with your team and across the business.
2. Do your research
Work should begin before you even start in your new role, so you have some context and understanding before day one.
You could research your company’s history, mission, and values. This’ll help you better understand your business and what it stands for.
Think about other preparatory steps, such as reviewing financial statements and reports, and other company documents.
There’s no harm in getting early insight into your processes; you might even identify some potential improvement areas.
Consider setting up early meetings with the CEO, executive leaders, and finance team members. Use these meetings to introduce yourself and learn more about the organisation.
Attend company events such as town hall meetings, team-building activities, and other social events.
Meet other employees informally and get a sense of your culture.
3. Find an external mentor
Searching for valuable guidance and support as you navigate your new role is always helpful.
An external mentor can offer a fresh perspective and provide insights into your challenges and opportunities as a new CFO.
They can also offer advice on building relationships with key stakeholders, developing a leadership style, and managing the role’s demands.
Similarly, connecting with other CFOs or financial leaders in similar roles could give you insights into best practices, industry trends, and potential challenges. These peers can also offer a sounding board to discuss your ideas and plans.
4. Define what success looks like
Ultimately, success in the first 90 days will depend on your company’s goals and objectives and your strategic focus as a CFO.
Here are some suggestions for goals that can help act as your north star—make sure you add some relevant metrics.
- Develop a financial plan that aligns with the company’s strategic objectives and ensures financial stability and growth.
- Establish effective financial controls and processes to ensure compliance and mitigate risks.
- Build strong relationships with key stakeholders, such as investors, lenders, and the board of directors.
- Develop a high-performing finance team aligned with your company’s goals and objectives.
- Implement digital transformation initiatives that prime your business for growth, improving operational efficiency and reducing costs.
- Communicate effectively with the CEO and other business leaders to ensure financial insights and recommendations are factored into their decision-making.
5. Meet with your finance team right away
As a new CFO, meeting with your finance team straight away is critical to establishing relationships, understanding their roles and responsibilities, and identifying any challenges or opportunities.
Schedule individual meetings with each team member to introduce yourself and learn their roles and responsibilities. Ask questions to understand your existing financial processes and systems better.
By talking to your people, you’ll get a feel of team dynamics and how team members interact with each other.
Identify any areas where you can make improvements to enhance collaboration and communication.
Understand where to prioritise initiatives and allocate resources effectively. Set expectations for your team regarding performance, communication, and collaboration.
Look at how you can establish a culture of accountability and teamwork.
6. Understand your finance team’s relationship with other departments
As a CFO, you must understand what other departments think of your finance team to identify areas for improvement and enhance collaboration.
Schedule meetings with department heads to introduce yourself.
Learn about different perspectives and concerns regarding your finance department, and ask questions to understand better how you can interact with other departments daily.
Review past interactions between finance and other departments to identify any areas of tension or misunderstandings. Identify areas for improvement and where you can work with other departments to enhance communication and collaboration.
Understand and prioritise any issues you see that need fixing and allocate resources properly.
Communicate effectively with other departments to build trust and credibility. Make your comms are clear and concise, focusing on giving the most important and relevant financial information and insight with the right context.
Develop a plan to improve finance’s reputation and relationships with other departments. Include specific initiatives and timelines to address any areas of tension or misunderstandings.
7. Understand your CEO’s vision and long-term strategy
As a new CFO, you’ll want to align your financial goals and initiatives with your CEO’s vision and long-term strategy.
Schedule enough meetings with the CEO to get on the same page. Come armed with questions to help you better understand the CEO’s priorities and goals and where you can help.
Once you’ve satisfactorily engaged with your CEO, review your strategic plans and initiatives to understand how they align with their vision and long-term strategy.
Identify areas where you must allocate financial resources to support their big ideas.
Understand the competitive landscape.
It’ll benefit everybody if you understand your competitive landscape and how the CEO’s vision and long-term strategy fit and position you in the market. You might be quickly able to identify financial risks and opportunities.
You could also think about reviewing your company’s previous investor presentations to understand how your CEO communicates their vision and long-term strategy to external stakeholders.
Support them with financial information and insights that are easy to understand.
8. Build a picture of your company’s current financial health
As a CFO, you’ll want a comprehensive understanding of your company’s financial health, including its revenue, expenses, profits, and cash flow.
High-level, this knowledge will help you to identify areas for improvement where you can reduce costs, increase revenue, or improve cash flow.
You will want enough insight to make informed decisions about your company’s financial strategies and initiatives, such as ones related to investments, financing, and risk management.
A solid understanding of your basic financials can help you communicate internally within the business and externally.
Show control and understanding of your financial performance, risks, and opportunities to investors, board members, and other key stakeholders.
9. Understand current cash flow
While reviewing your cash flow, you may spot concerns such as cash shortages. You may want to fix inefficiencies in your cash management processes, such as slow collections or excessive inventory levels.
If you’ve got good financial management software, you may want to identify patterns and trends in cash inflows and outflows over time.
Once you’ve grasped your cash position, you can create a comprehensive plan to improve inflows, reduce outflows, and optimise your cash balance.
Examples of strategies to implement include:
- Improving your cash conversion cycle
- Negotiating better payment terms with suppliers
- Accelerating customer collections.
10. Know your company’s accounting practices
As a CFO, reviewing your accounting policies and procedures is crucial to ensuring compliance with standards and best practices.
Keep up with your industry’s latest accounting updates and ensure your business is ready to handle them.
You may want to look at areas where you can make improvements to streamline processes or improve accuracy—whether automating processes to reduce errors or improving data quality.
Again, financial management can certainly help here.
Think about how you can strengthen internal controls. It’s better to do the work to fix potential problems before they happen.
Ensure you have appropriate segregation of duties and effective fraud prevention measures.
11. Review your financial reporting
As well as making sure financial statements are accurate and complete and that you have the appropriate disclosures, you’ll want to present your financial information in a timely, clear, and understandable manner that meets the needs of stakeholders.
Your financial statements should be free from errors or inconsistencies.
Financial management software can often support this, as it offers a fast and accurate way to reconcile your accounts and get clean, trustworthy data.
Ensure that your financial statements are timely by setting deadlines for each step of the financial reporting process.
Put in the time to ensure your books are closed on time, financial statements are prepared and reviewed, and that you meet any regulatory reporting requirements when you should.
Make sure you’re meeting stakeholder needs.
By understanding their reporting requirements and expectations, you can create financial statements that meet their requirements.
Communicate with your board of directors, investors, lenders, and other stakeholders to ensure your financial statements are formatted correctly, presenting information meaningfully and usefully.
Think about how you can continuously improve.
Since financial reporting is so important, you will want to spend time identifying areas for improvement. If you’re still using spreadsheets, for example, you may well want to get automation quickly in place to get the books closed much more quickly.
12. Audit issues
Looking at independent reviews of your company statements in the form of audits could be very helpful, as they might provide some insights you can act on quickly.
You can identify strengths and weaknesses and where you stand financially.
You may discover areas where you need to improve your internal controls or financial reporting processes—it’s particularly important to follow legal and regulatory requirements.
If you see problems, you’ll want to address any issues or concerns raised by the auditors. Identify responsible parties and build timelines for completing each action item.
13. Review budgets
Reviewing your budget is the first step in understanding your financial goals and priorities for the upcoming year.
Focus on revenue and expense projections and any capital expenditures or investments to align with your strategic objectives.
A thorough budget review can help identify areas that may need adjustment. These could include areas where you may need to reduce expenses, increase revenue, or reallocate resources to support your strategic initiatives.
With the identified areas for improvement, develop an action plan to address any issues or concerns. Define the responsible parties and timelines for completing each action item.
Technology, such as automated reporting, forecasting, predictive analysis, expense tracking, and performance dashboards, can aid this ongoing process.
Regular reviews will help you determine whether you’re on track to achieve your financial goals and priorities.
14. Understand your key financial metrics with benchmarking
Financial metrics in isolation could tell you about the status or health of your business. However, they have relatively limited worth without benchmarking or a comparative context.
So, to help you understand how you are performing, benchmarking your finance department’s performance against peers can be an extremely useful exercise in the first 90 days.
Identify the key metrics you want to benchmark against other finance departments.
These could include the finance cost, staff productivity, finance cycle time, and other relevant metrics aligned with your company’s strategic goals and objectives.
Then, identify peer organisations that are similar in size, industry, and complexity.
You can find this information internally or through industry associations, conferences, or other networking opportunities.
Gather data from peer organisations. Use surveys, public financial reports, or other sources. Collect data for the most recent period.
Analyse data to identify areas where your finance department is performing well and where there’s room for improvement.
Identify the gaps between your company’s performance and peer performance, and determine the root causes of these gaps.
Use data insights to prioritise initiatives and allocate resources effectively.
Develop a plan to improve your finance department’s performance based on the benchmarking analysis. Include specific initiatives and timelines to address any areas of weakness.
Align the plan with your company’s strategic goals and objectives, and communicate it to your finance team and relevant stakeholders.
15. Meet important external stakeholders
It’s worth speaking to investors, customers and suppliers to build a network of support and collaboration.
Aim to establish relationships based on trust and credibility, understand perspectives and concerns, and identify areas where you can work together.
You may see financial risks and opportunities, as well as areas of possible collaboration.
Be open to feedback and listen to what others have to say.
16. Get involved with strategic planning
As a CFO, your financial insight is invaluable.
By the 90-day mark, you’ll want to take an active seat at strategic planning sessions to provide a clearer understanding of your financial abilities and constraints when setting wider strategic business objectives.
Introduce strategic planning sessions if they’re not yet a part of your company’s regular process. Facilitating such sessions can help you bake financial realities and goals into strategy from the start.
Build or update financial models to project your company’s future under various scenarios.
You and your colleagues will better understand potential outcomes, helping you make informed decisions about the strategic direction.
Analyse your current capital structure and consider if it aligns with your long-term goals. Address questions such as whether you should take on more debt, issue equity to fund growth, or if you’re over-leveraged.
Use scenario analysis to understand how different situations could impact your company’s financial health and ability to achieve its strategic objectives.
Include potential opportunities such as a new market entry, and threats such as economic downturns or disruptions in the supply chain.
17. Build your long-term vision and plan
This is the big one.
The majority of your time in the first 90 days will be spent collecting information and building a picture of the current state of finance in the company.
As you do so, you’ll start forming a long-term plan for what needs to happen and what you want to achieve in the future, particularly after talking with the CEO.
Sometimes this can take less than 90 days, other times significantly longer than this. It all depends on the information you collect and the current state of the company.
At some point, though, you’ll need to document your long-term vision and plan as you form it.
Keep it concise and tangible.
You could think about building a five-year plan, aligned to your company’s goals – whether that be an initial public offering (IPO), mergers and acquisitions (M&A), growth targets, or something else.
A one-page vision, with the information behind it, could be easier to communicate.
It may also be that the company or CEO has a long-term vision or plan, therefore you build the finance plan around that.
Either way, don’t get lost in the detail as you onboard into your new company. Before your first 90 days are up, consider what your long-term plan, vision, and goals are – and get them down on paper.
As a new CFO, we’ve already established that you need a clear vision for your role and have it aligned with your business’s and CEO’s strategic objectives.
But how do you get your message across?
Here are some key steps to drive support.
Clearly articulate your vision and how it aligns with your organisation’s strategic objectives. Communicate your priorities and goals. Set expectations for how your team will contribute to achieving them.
Encourage open and honest communication with stakeholders to get their input on your vision.
This includes seeking feedback from your team, board members, investors and key stakeholders to ensure your vision meets their expectations.
Address any concerns or questions that stakeholders may have. Be open to feedback and adjust as needed to build that coalition of support.
Develop a detailed plan for making your vision a reality, incorporating feedback where necessary.
Set clear objectives, identify key milestones, and allocate resources effectively.
Let the business know where you are, celebrating successes and addressing challenges transparently. You’ll want to provide regular updates to stakeholders on the progress of your vision and any challenges or obstacles that arise.
19. Make an impact at your first board meeting
Making a good impression at your first board meeting is crucial to establishing credibility as a new CFO. It’s a golden opportunity to build trust with board members that will be essential for achieving your goals and objectives.
Prepare thoroughly.
Before the meeting, review the agenda, board materials, and any relevant documents. Ensure you understand the issues and come prepared with thoughtful questions and insights.
Take the time to introduce yourself to the board members and other executives. Establish a personal connection and build rapport.
Be concise and to the point.
When presenting to the board, focus on the key issues concisely. Provide clear and actionable recommendations and avoid getting bogged down in details or technical jargon.
Use your business and industry knowledge to show you know where the problems and opportunities are. Support your recommendations with insight and be prepared to answer questions.
Communicate transparently and honestly with the board.
If there are issues or challenges, be upfront and provide a plan for addressing them.
After the meeting, follow up with board members to answer any questions or provide additional information. Show your commitment to working collaboratively to achieve your goals.
20. Understand potential CFO challenges and roadblocks
As a new CFO in the first 90 days, you’ll be lucky if everything is plain sailing.
Here are some specific challenges you’ll come across and tips on how to overcome them.
Understanding your business culture
Adjusting to your new company’s culture and dynamics is not always easy.
To navigate this, investing time to learning about the company’s history, values, and operations will be invaluable.
However, interacting with a broad range of employees will provide the insight you won’t be able to get from marketing materials and internal communication.
Managing change
CFOs often need to implement changes to improve financial business health, something that can often lead to resistance.
It’s important to communicate the rationale behind the changes and take feedback from disgruntled people or teams.
You could even involve them in the process.
Data inaccuracy and unavailability
Accurate, timely financial data is crucial for your decision-making process.
If your existing financial management system isn’t up to the job, prioritise putting a more reliable system in place.
Compliance issues
As you dig deep into your financial work, you may find regulatory non-compliance a bigger headache than expected.
You may have to work closely with your legal and compliance teams to understand issues and plan corrective action.
Stakeholder management
Building relationships with key stakeholders, both internal and external, is crucial for success.
However, it will be challenging, especially if you’re gifted more with handling numbers than handling people.
Regular communication and natural transparency will help in building trust.
21. Don’t try to tackle everything at once
It’s important to remember that time is precious, and you’ll feel that you’ll never have enough of it.
As a CFO, it’s essential to prioritise critical issues to maximise your impact.
Here are some strategies to help you do just that.
Focus on key areas
Start by identifying the most pressing needs and challenges facing your organisation. Focus your efforts on the areas that require the most attention.
Once you’ve identified your most pressing needs and challenges, prioritize the initiatives that will significantly impact performance.
Remember to delegate and collaborate
Delegating tasks and empowering others can help free up time to focus on critical issues.
Aim to build a strong team around you and foster a culture of collaboration. Collaborating with other departments can help you gain a broader perspective on critical issues and identify new solutions.
Be ready to change course
As new information emerges or priorities shift, be prepared to adjust your plan.
Being flexible and adaptable is essential to achieving your goals. It’s important to communicate any changes to your plan to whoever needs to know.
Ensure everyone is on the same page and working towards the same objectives.
22. Tap into the power of tech
A CFO isn’t traditionally responsible for creating a digital transformation plan, but your role is evolving. Digital transformation is a critical part of every business operation, including finance.
Given this, you should involve yourself in any digital transformation strategy, particularly where it impacts financial operations.
Modern financial consolidation, reporting and analysis involve automation, and you’ll want to identify the areas where it’ll fit.
And with the rise of big data, AI, and machine learning, you have more information to draw insight than ever before.
By understanding the value of digital transformation, you can harness data to make more informed decisions, drive strategy, and steer the company towards its goals.
Here are some ways you could contribute to a digital transformation plan.
- Financial planning: You can help plan investment in digital transformation, balancing the costs and benefits and ensuring your business invests wisely in technology.
- Risk management: As with any major change, digital transformation brings risks. Your finance team can identify, assess, and manage some of them.
- Change management: Digital transformation often involves significant changes to business processes. You can contribute to managing this change.
- Data governance: Digital transformation often involves large amounts of data. You can help ensure you manage data appropriately, mitigating possible privacy and security issues.
- Skill development: Digital transformation often requires new skills. It’s your job to ensure that your finance function has the necessary skills for the digital age, including data analysis and digital literacy.
23. Place confidence in yourself and why you were hired
The first 90 days as a CFO are crucial for establishing credibility, building relationships, and setting a clear direction for your finance team.
Thoroughly assess your finance function, understand your business’s strategic objectives, and develop a finance strategy aligning with them.
Building strong relationships with key stakeholders, including the board, business leaders, and employees, will be critical for gaining support and buy-in for your financial strategy.
Of course, using the right financial technology can also help to drive efficiency and improve the accuracy of financial reporting as part of a digital transformation programme.
Most importantly, however, is to remember the skills and expertise you bring.
You were hired for the role for a reason and although the first few months in a new job can be daunting, you are the right person for the job and it’s vital to remember that during tough times at the start whilst you’re still new in the role.
Tapping into that mindset will also help project confidence in yourself that will benefit you in how you present yourself to others.
Summary
With a clear vision, strong relationships, and the right technology, you can make a strong impact in your first days and set the stage for long-term success as CFO.
Source: information from Sage
Prepare to migrate risk
New CFOs must understand the contextual factors that can impact their performance and proactively plan to address them or account for them.
Preparing for your new challenge includes:
- Mitigating team change resistance
- Reducing team disruption
- Encouraging team alignment
Managing team change resistance
The greater the level of change required by the new CFO or finance leader, the higher the probability that finance team performance targets will be missed. However, not everything related to change is negative: If the incoming CFO joins a team that is comfortable with risk and open to change, the chances that the new leader will succeed increase. In fact, the higher the team’s risk tolerance or openness to change, the larger the positive impact on new leaders’ performance.
The right way to accomplish this is through an “transparent change” approach. This harnesses the power of the broader finance team to collaborate, create and implement change — ultimately driving employee excitement and buy-in. This means involving employees in the change strategy process so they can feel part of the change and understand what this means not just for them but for the business.
Minimising team change
CFOs must help their teams navigate change uncertainty, which negatively affects engagement and productivity. The best way to do this is by making their teams feel empowered by providing support and listening to feedback. Foster an environment of change and development so employees feel confident about sharing new ideas and strategies for better business planning.
Encouraging team alignment
The finance industry relies heavily on collaboration and coordination with others. To succeed, new leaders must consider the relationship between their teams and other stakeholders, and understand the trade-off between agility and alignment.This needs to be a priority for any new leader or CFO when starting their new position.
Agile teams are capable of quickly understanding new business contexts and transforming how finance works to provide maximum value. While CFOs can make a number of changes to improve their function’s agility, these are the most common and successful approaches:
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Control transactional, day-to-day activities and processes
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Break down silos by integrating finance teams
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Rethink talent strategy to continuously adapt to changing internal and external environments
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Boost analytics capabilities and responses to new requests
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Improve processes to more flexible
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Nurture and build relationships
Build trust
Develop trusted stakeholder relationships
Building relationships, trust, and credibility are key to a successful CFO transition. It is important to do this with your peers, C-suite members and the board.
Connecting during your new appointment includes:
- Relationships with stakeholders
- Building trust in your team
- Establishing your personal brand
Building stakeholder trust
New executives’ success is more dependent on their colleagues as the work becomes increasingly complex and collaborative. Relationships with the CEO, board and other executives are essential to influence employees who do not report directly to the executive.
Relationship building is not an instinctive process for incoming CFOs. They need to be intentional. New CFOs and finance leaders should focus on creating an internal network within their team to gain a positive impact on their performance:
- Prioritise stakeholder relations
- Credibility is the foundation of all relationships
- Clarify expectations and boundaries
Building Team Trust
The team that new CFOs manage is a key component to their success. CFO’s Direct reports can provide them with valuable information on the inner workings and finances. They can also act as a sounding-board and help them to understand the strengths, weaknesses and opportunities in finance.
The team must be comfortable with providing feedback and information to the new CFOs. To build trust in a team, CFOs should follow these principles:
- Find out about employees motivations and challenges and their opinions about the team
- Advise of your expectations and the value they should bring
- Include the team when appropriate in key decisions, assessments and goal-setting
- Encourage a team-oriented environment
Establishing your own personal brand
Your personal brand is what people know you for, and what they think of you. What kind of CFO do you consider yourself to be? What type of CFO are you? The CFO who is disruptive? The growth-guru? Brands communicate your purpose, establish credibility and create hype – allowing you to connect with stakeholders within the new company.
Think of some prompts about who you would like to be as a successful CFO; How would you describe your current reputation in terms of leadership, execution, vision, and innovation?
Assess the current finance function
Establish clear initial priorities by reviewing performance data, benchmarks, and feedback surveys to understand and analyse the key issues. Avoid analysis paralysis. Gain insight, and refine over time.
We suggest the following insights and data analysis:
Assessing finance performance
A lack of understanding of finance’s effectiveness leaves finance leaders with unfocused investments, unsupported initiatives, and the wrong priorities. To avoid this, new CFOs should evaluate their organisation to identify opportunities to improve performance and efficiency in these four categories:
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Performance: Understand how major facets of the finance function are performing.
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Costs: Analyse personnel, technology, overheads and any other costs necessary to the operation of the finance function.
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Process: Determine how advanced the finance function’s capabilities are relative to other organisations. With finite resources, CFOs have to prioritise the capabilities that matter most.
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Alignment: Understand which activities matter most to internal stakeholders and stakeholders’ perception of the value of finance’s support for those activities.
Assessing your talent pool
Knowing how well the organisation’s current talent pool can meet current and future business needs is a priority for most transitioning CFOs. New leaders should start regular assessments of their finance function’s skills and competencies as part of updating the talent plan and investing in the development of the team.
Keep these five recommendations in mind to assess current and potential talent:
- Align talent expectations with business objectives.
- Identify appropriate competencies to evaluate finance talent.
- Clearly articulate competencies.
- Identify proficiency and growth potential of current talent.
- Proactively account for possible skill shortages.
Assessing organisation structure
Even seasoned CFOs struggle with organising finance in a manner that is efficient and supports the value creation mandate. Finance organisations that are most successful choose their structures according to how the work is actually performed, rather than using standard templates. To help achieve this, new CFOs can consider the following:
- Centralisation or decentralisation? Assess the models of finance service delivery, including COEs, Shared Services Organisations (SSOs), BU-aligned finance, and regionally aligned finance, based on objectives.
- Outsourcing: When determining an outsourcing strategy, take into account factors like the contribution to competitive edge and impact on daily operational performance.
- Structure of the finance subfunction: Identify and categorise subfunctions in terms of their scope, specialisation opportunities, responsiveness and agility, as well as customer experience.
Face problems and plan for the future
Update the roadmap and establish strategic vision
The new CFO should establish a vision that is clear and forward-looking for the role early on to help the team see where it’s going and what each individual will do to contribute to the team and the business. The team will lose focus if they don’t have a vision, because employees’ actions and mental energy may not match the ambitions of the new CFO. This can lead to a reduction in productivity.
The new CFO should also be clear on how to achieve the vision. Create a road map that mobilises the executive leadership and employee resources to support initiatives that drive execution.
A useful road map should at least address these four challenges:
- How can the finance function achieve its vision? Is the finance function in need of new skills?
- Does the current finance process and policies need to be changed to achieve your vision?
- Which IT changes are required to succeed? Is it necessary to eliminate data silos?
- Who are finance’s partners in business?
Identifying potential functional risks
To meet finance’s goals, it is important to identify and address risks as soon as possible. Although the risks that can affect a CFO’s vision are varied, these common ones should be kept in mind.
- New business requirements
- Budgets
- Technological disruption
- Risk and compliance
Measure Improvement
The new CFO must support this vision by setting aspirational, but realistic, performance targets and defining KPIs that will measure these. Set functional efficiency and effectiveness goals that will drive desired outcomes when they are executed effectively.
Measurement is key to any CFO’s success, as unless you know how you were performing before you started, how can you gain recognition for the improvements you’ve made within the business.
Source of information from this article is Gartner. For more information or insights please visit their website.
Introducing Chris Hawley, our latest recruit in our business development team.
We would like to welcome Chris Hawley to the X3 Consulting team, Chris has worked with Nick before (both had less grey hair and Nick had hair!) and a chance conversation has led to them working together again. Like Nick, Chris has over 30 years’ experience of providing ERP solutions, working with everything from start-ups, sole traders to large enterprises.
Chris also brings with him over 24 years’ worth of experience of working directly for Sage, working with just about every product or service they have ever produced in a range of roles. One of his many claims to fame is he was the Sage 200 Suite Product Manager, where he steered the Sage 200 product from its early days, turning its fortunes around and growing it into the successful product it became.
After leaving Sage, Chris setup a successful business as a Sage Business Partner which after 5 years, he sold to another Sage partner. Now after a small break Chris is delighted to bring his wealth of experience to the X3 team and help the business grow even further as we become a key player in the UK and Global ERP marketplace.
X3 Consulting Managing Director, Jaco Esterhuysen, said: “Chris brings a valuable breadth of skills and experience to our sales team. Having worked across diverse sectors including healthcare, education, finance and services, he will be able to draw on best practice from these areas to introduce new opportunities and approaches to our business. His proven commercial background, combined with strong customer focus, will help take us to the next level of our growth strategy and keep us at the forefront of our industry.”
In his own words, Chris is very keen to start looking at Sage Intacct as the Sage Cloud products hold the promise of delivering on the often-promised goals of ever-growing business efficiency and automation.
Based in Wylam, Northumberland with his wife Jules (another ex-Sage person) and their 3 children, Chris spends his time in his own gym and at weekends is helping Jules with her passion to setup a market garden business on the small holding they own, Chris is quick to point out that he is not green fingered in the slightest and prefers technology!
