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The role of CFO at innovative product companies has quickly evolved from “bean counter” to powerful agent of change and business leader. In manufacturing's past, the role of the CFO has been limited to accounting practices, such as ensuring company compliance with financial reporting and control requirements — rather than any direct involvement in specific IT strategic initiatives.
CFOs see how inventory translates to dollars in an ERP system but don’t always have complete clarity as to how improving product quality and time to market translates to cost savings and earnings. But that may all soon be in the past. A new manufacturing economy requires new champions with a broader, more holistic view of the enterprise.
The treacherous waters of a competitive global economy require savvy fleet commandeers who can heroically navigate their business away from dangerous rocky shoals and into profitable new ports. Today, strategic-minded CFOs are now asking such questions as:
“What dominant new product introduction (NPI) challenges are restricting business growth?”
“What manufacturing tools can help overcome these obstacles?”
“What emerging supply chain business trends risk impeding our success and how can finance help out?”
According to a recent report by Deloitte, “As companies continue to adapt to volatility while boosting their pursuit of growth, CFOs are gaining an increased role in strategy.”
The aforementioned Deloitte report included a survey in which CFOs claimed to have strategic input in which industries their companies should enter/exit (78%), and what businesses to grow/shrink (73%). The report also discovered that CFOs are most likely to spearhead decision-making processes, including where to focus cost-reduction efforts (57%), which performance measures to track (58%), which businesses to acquire/divest (41%) and how to create value (40%).
So what do all of these statistics add up to?
For one thing, these findings indicate (whether fiefdom-conscious CIOs like it or not) there’s an increasing trend for CFOs, especially at small to midsize manufacturers, to vet – daresay – drive technology investments.
To learn more about the evolving role of CFOs in modern product development companies, download the whitepaper Why Executives Are Banking on Cloud PLM to Save Money.
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John is a Senior Content Marketing Manager at Omnicell. He is a results-driven consultant who has worked with some of the biggest names in technology, including Oracle, Cisco, Hewlett Packard, and IBM, to improve their marketing and lead generation strategies. John holds a Bachelor of Science in Engineering and Journalism from the University of Wisconsin-Madison.
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