Being Planful: CFO News & Helpful Resources for the Office of the CFO

Thanks for stopping by this installment of “Being Planful,” our series that recaps the latest finance trends, accounting viewpoints, and trending news for the Office of the CFO. We’ve scanned the headlines for trending topics and here’s what we found:

• Overcoming growth challenges: Layoffs are rarely the answer in times of economic uncertainty. Consider more strategic areas to balance growth and profitability without letting go of your most valuable assets — your workforce.
• Recruitment: There’s a massive talent war happening in finance right now. How can CFOs win? Studies show the way to attract top talent is to invest in competitive pay, flexibility, and career development opportunities.
• Technological mindset: AI is the inevitable way of the future. But technology for technology’s sake is never the answer. It’s up to CFOs to understand the impacts of AI and how it can be used smartly to benefit their organization.

Many companies are stuck in a kind of economic limbo. Operational costs are outpacing cash flow, which is leaving CFOs in a “financial balancing act … [to] prioritize smart and efficient investment opportunities.”

Despite the doom and gloom headlines, sustainable growth is possible so long as CFOs make smart business decisions.

• Are layoffs the best answer? A recent study by ResumeBuilder found that one in three companies expect to lay off “30% or more” of their workforce in 2023. But, as Omar Choucair, CFO of Trintech, points out, “a significantly reduced workforce could result in even further productivity challenges and lost revenue.”
• Turns out, sweeping layoffs should be a last-ditch effort to stay afloat, not a go-to when times get tough. CFOs can instead turn to more sustainable cost-cutting opportunities, such as reevaluating current vendor relationships and analyzing customer collection and payment policies.
• Digitalization can also play a role in improving workplace efficiency. In a recent study by Mercer, 57% of CFOs and CEOs plan to invest deeper in AI.

The Bottom Line: Even in a less-than-ideal economic climate, growth is still possible. Rather than making sweeping cuts in the form of mass layoffs, CFOs can take more appropriate measures:

• Prioritize working capital.
• Invest in proper tech to automate work processes.
• Build forecasting models that are flexible enough to account for different potential economic scenarios

The skill set for the average finance worker has changed. It’s no longer enough to master accounting, risk, and controls. Now “what CFOs are now looking for are people with a much greater degree of tech fluency, data analytics skills,” says Steve Gallucci, global and U.S. CFO program leader with Deloitte.

Enter: the talent war, where businesses have a tremendous demand for people with top-tier skill sets, who are really tough to find.

What does it take for CFOs to win these in-demand, skilled workers?

• Give workers a sense of purpose and be transparent about your vision for the company.
• Offer top-down support from your organization’s C-suite.
• Invest in cutting-edge technology to power your business.
• Provide ample professional development opportunities to advance their careers.

The Bottom Line: With recent layoffs spiking in certain industries, there’s an opportunity to scoop up highly skilled workers. It all starts with having a positive workplace culture, including “being an engaged, empathic leader” and genuinely investing in the well-being of your workers.

These days, there’s major hype surrounding the use of artificial intelligence (AI) to automate workplace processes. The challenge for CFOs and their fellow C-suiters isn’t in finding any ol’ AI technology but in finding the best possible solution to boost business performance without raising costs.

The challenges?

• CFOs tend to be “creatures of comfort,” sticking with tried-and-true processes. But with AI becoming more mainstream, CFOs should join the conversation and review different use-cases across their organizations.
• AI is still new, as far as technologies go. The most effective automation tools are those that involve a human touch, like chatbots, predictive text, and pre-filled forms.
• Customer service, in particular, can benefit from AI. Automations solve customer needs quickly and accurately. Plus, you can pull data from these interactions to better understand (and improve) the customer experience.

The Bottom Line: As financial leaders, CFOs have a critical role to play with AI utilization of their organizations. “You don’t necessarily need to understand exactly how AI works,” says Matthew Malek, CFO of Interactions LLC, “but what’s the impact? How could it help? How could it potentially hurt?”