CFO Problems: Top Challenges & How to Tackle Them

In recent years, the role of the chief financial officer (CFO) has undergone significant changes, marked by a surge in responsibilities. Today, CFOs collaborate closely with CEOs to enhance financial performance and maintain optimal cash flow. Their array of duties is broad and set to keep growing in the foreseeable future. Traditionally, CFOs and their finance teams are tasked with:

Assembling a proficient financial team

Ensuring expenditure and revenue are balanced

Supervising financial planning and analysis

Securing funding

Providing counsel on mergers and acquisitions

Collaborating across departments to scrutinize financial data and devise budgets

Ensuring the precision of financial reports

Advising the CEO on financial strategies

The role of the CFO is evolving from traditional financial oversight to a greater focus on business strategy. CFOs are now integral in planning and decision-making processes, collaborating with other C-suite leaders to create a connected planning approach that aligns various business functions and enhances strategic insight.

Despite the escalating scope of responsibilities, the CFO role remains fiercely competitive. Novices must demonstrate an unprecedented set of skills to secure their position. Meanwhile, veteran CFOs face formidable challenges in navigating the global economic landscape. In this article, we outline the primary challenges confronting CFOs today such as multi-tool tech stacks and shaky processes and propose to move towards a unified solution for CFOs for cost-efficiency, improved client experience, and better visibility.

If your processes are shaky, or if you are not effectively using your tools, then no amount of technology will be able to save you. Data governance is crucial in ensuring the accuracy and efficiency of financial processes. You should start with analyzing how your processes are aligned with the technology you’re currently using. How do you handle invoicing, reporting, receivables, and payments? Emerging technologies can help streamline invoicing, reporting, receivables, and payments. What tools do you use for these processes, or are they still manual at all? The problem is, when you do a lot of copy and pasting at the end of the month to close the books, you may be missing out on a valuable part of the reconciliation process, as reconciliation should happen automatically when you use the right tools.

The positive cycle of adoption speaks volumes about the benefits that automation can deliver to finance. Here are some of the most prominent benefits of finance automation.

It may be tempting to fix those gaps with another software. But before doing that, take stock of what tools you actually have. Ask yourself - am I using all of your tech efficiently? New features are constantly introduced, and, unknowingly, you may accumulate multiple tools that serve the same purpose or you may already have workarounds for processes that can actually be resolved by another tool in your stack. One of the downsides of a multi-tool setup is that it comes with subscription costs. Additionally, unifying disparate data from various tools is a critical challenge that needs to be addressed to create a cohesive view of financial information.

Are you aware of what you’re paying for and how much?

Does anything you’re paying for on the highest tier of the tool you’re using that you could drop to a lower tier if you don’t need the features?

Thinking about what you already own before making a new purchase is also another reason to consider what you currently have. Alternatively, you can take it a step further and explore the possibility of transitioning to a unified system that handles all financial operations. Technology investments play a crucial role in optimizing the use of existing tools, enhancing efficiency, and supporting new product developments.

Unified solutions are met with certain hesitation on whether or not they are robust enough to deliver value in a way that’s worth abandoning your current set up. Firstly, you don’t need to throw all your tools out yet. Instead, it’s about scaling down, and secondly, the benefits of unified platforms for financial operations significantly outweigh the drawbacks. Let us demystify it.

In the first place, a unified financial operations solution does not require you to give up on your favorite OCR or accounting software. A platform like Fyorin can help you streamline your day-to-day financial operations by bringing together processes such as payments, receivables, expenses, and Treasury management. It can be connected with systems like Dext or Xero to simplify the day-to-day financial operations. Instead of having to manage accounts receivable, accounts payable, expense management, invoicing, reporting, and a global wallet separately, you could use one tool for everything. A unified solution can enhance the efficiency and accuracy of the finance function by integrating emerging technologies.

Moreover, a unified financial operations solution can significantly improve the overall management of financial tasks. This is where the finance team plays a crucial role in managing unified financial operations, ensuring that all processes run smoothly and efficiently. Finance teams leverage profitability and cost management software to collaborate with sales and marketing for better product pricing and service offerings.

With real-time visibility into cash flow and spending, you can consolidate otherwise fragmented data and close your books more efficiently. Additionally, it would reduce errors when transferring data between multiple systems and improve overall compliance. With less time spent on manual work, you can offer your clients better and more informed advice.

Predictive analytics can further enhance this by improving the accuracy and speed of financial forecasting, allowing CFOs to adapt quickly to market changes through better data insights.

Moving to a unified solution decreases subscription costs. Rather than having separate tools for all financial operations you could pay for just one. In the current economic climate, many vendors choose to raise their prices. They convince you that it is easier to accept increased costs than to offboard your clients. What often comes with increased prices is also a decline in the quality of customer service and slower product development. Maintaining financial health is crucial for cost savings, ensuring cash flow stability and investor confidence.

This means that the new features you need may be delayed or never delivered. Switching may seem overwhelming. However, with the assistance of a dedicated implementation team, transitioning to a new solution may save you money in the long run. Furthermore, ask yourself: Would you prefer to pay for another tool, hire an additional staff member, or simply rely on a single platform to assist you with your day-to-day tasks? Given the widespread shortage of accountancy skills, the need to perform financial operations efficiently without adding another staff member is becoming crucial. A unified solution can also help identify and pursue growth opportunities, making it easier to adapt to new market demands.

Lastly, consider your clients. Do they need to use two or three different tools for payments - for instance, one for approvals, one for bills, and then still log into the bank to execute payments? What if they expand into an entirely new geographical market or start accepting payments in different currencies? Will the current tech setup be able to support them or will they be required to navigate the process of getting onboarded into a new financial institution? Finance professionals play a crucial role in ensuring client satisfaction by adapting to these evolving needs and leveraging technology to streamline financial operations.

Mostly likely, as a business scales internationally, additional tech stack might be required to address cross-border challenges. That may put your practice in a position where you either need to let go of such client because you can’t accommodate their requests or it becomes too costly to maintain, due to the manual work involved. Finance leaders are responsible for managing client expectations and operational efficiency, ensuring that strategic financial planning aligns with the dynamic market demands.

Platforms like Fyorin enable a business to scale cross-borders without the need to grow the financial operations team. Fyorin’s clients, from one single platform, can operate across a global network of financial institutions, giving businesses access to cross-border payments with the ability to send and receive funds, as a local, in over 150+ currencies. Using a platform like Fyorin can positively impact financial performance by streamlining global operations. Other financial operational efficiency benefits include unification of treasury across all bank accounts and expense management tools. Fyorin platform also connects with the major cloud accounting platforms like Xero, Quickbooks and Microsoft Dynamics so that payables and receivables can be automated. Without the need to manually login into the bank to manually reconcile.

While we understand the hesitation surrounding using one tool for all financial operations, the benefits far outweigh any potential drawbacks. Digital transformation plays a critical role in enhancing financial operations, making them more efficient and effective. Ultimately, with a consolidated solution, you can serve your clients better, faster, and more accurately. And they will appreciate only remembering one set of login details to do it all.

A unified solution can drive the business forward by improving efficiency and enabling more strategic decision-making. If you are ready to explore moving to a unified solution and managing all financial operations and managing treasury in one place, visit fyorin.com or contact us at: [email protected].