cfo data scientist

Perspectives

The data scientist, the chatbot and the CFO

A perspective on our autumn survey of Swiss CFOs

Our autumn survey of Swiss CFOs certainly brings some New Year optimism. CFOs on the whole appear to be feeling more optimistic now than in recent quarters on revenues and, perhaps more tellingly, feel that the additional revenue can be earned without margin erosion. These are welcome developments. The fog of uncertainty which has hung over the survey since the abolition of the exchange rate floor nearly three years ago appears finally to be clearing.

Whilst the slight weakening of the Franc over the summer may well be driving the improved sentiment, there is a new note of caution in the air in concern over exchange rate volatility. At the same time Europe’s super election year and the first year of the Trump administration have passed without the direst warnings coming to pass, geopolitical risk remains relatively high and maybe fuelling the exchange rate concern. With typical pragmatism Swiss CFOs appear to be planning in response further investments in innovative technologies to drive down operating costs in the mid-term to provide some cushion against the lower earnings quality arising from exchange rate uncertainty.

“How do I invest more resource in critical activities and deliver more value to my business whilst ensuring Finance contributes fairly to the corporate agenda to double-down on operating costs?”

Unsurprisingly therefore CFOs report that financial planning & analysis and profitability management are absorbing most of their time. The key challenge for CFOs appears to be “how do I invest more resource in critical activities and deliver more value to my business whilst ensuring Finance contributes fairly to the corporate agenda to double-down on operating costs?”

The digitally enabled transformation from reactive scorekeeper to proactive strategist is a vital area of focus for CFOs over the mid-term and will help them to magnetise the brightest millennial talents as they embark on their careers in Finance.

Further digitisation of Finance can help to solve this productivity challenge but the technology is only part of the answer. To deliver an enduring step-change in Finance’s operating capability targeted investment in digital tools must be complemented by re-skilling and re-focusing the Finance workforce. Traditional specialisms, for example recording and reporting, can today largely be automated. For Finance to succeed in the digital world new emphasis has to be placed on data interpretation and exploitation to reveal new insights into costs, revenues and new avenues to future profitability. The digitally enabled transformation from reactive scorekeeper to proactive strategist is a vital area of focus for CFOs over the mid-term and will help them to position their firms as the ones able to magnetise the brightest millennial talents as they embark on their careers in Finance.

How can digitisation help create the future perfect FP&A?

Cognitive technologies available today offer game-changing potential to raise FP&A productivity:

  1. Cognitive technology: Digital assistants can now do much of the crunching work traditionally done by FP&A Analysts. They do so far more quickly, providing in seconds natural language answers which would take even the most capable Analysts hours to prepare, and their work is error free. Analysts meanwhile are freed to think through the more strategic questions, propose targeted interventions to close gaps to forecast, or recommend hedging strategies to protect against loss. Productivity rises. Machines may be gaining intelligence, but humans are still smarter.
  2. Visualisation and advanced analytics: At the end of the day effective profitability management is all about making the right decisions – when to raise / cut prices? How to better manage costs, where to invest? Better then, that those decisions are well-informed. Digital assistants built on advanced visualisation, analytics, and speech recognition allow Finance to rapidly query, re-run and visualise alternative scenarios and provide support to complex business decisions. At the start of the day an up to date interactive dashboard on a handheld which responds to spoken requests to model new scenarios is a powerful tool to support the decisions which lie ahead.
  3. The science behind storytelling: As the nature of finance work evolves, finance professionals are evolving with it. Traditional skills continue to be valued, but increasingly they are complemented by new skills from outside core finance curriculums. Technology savvy millennials may have the edge as early adopters of the new tools but new mindsets and behaviours are equally important to finance in the digital world. To continually raise finance productivity CFOs and their teams need to become not just great scientists, adept at rapidly exploring large datasets to discover new insights, they need also to be great storytellers. Attention spans these days are famously short, getting to the right decision requires impactful communication and the best way to do that is to tell a great story.

We hope you find these perspectives on the CFO Survey thought provoking. If you would like to explore any of the themes raised further, we’re here to help.